HERMAN MASHABA | Dear Eusebius, race-based affirmative action has achieved poverty and discontent

Dear Eusebius McKaiser and South Africans

Dis-Chem Pharmacies CEO’s circular to its franchisees to stop appointing white job seekers to management vacancies, and to employ more black applicants instead to reach its employment equity targets, created a storm on social media. It was a clumsily worded communication. It deserved the social media storm it provoked. I also weighed in with a tweet which essentially called for the introduction of merit in hiring. Eusebius McKaiser wrote an open letter in TimesLIVE titled: Dear white South Africans (and Herman Mashaba) in which he reminds whites and myself of apartheid-era white privilege in hiring and other benefits, that the privileges were unearned and that whites continue to benefit up to this day. 

Below is my response.

This debate about the role and effectiveness of affirmative action policies such as employment equity and broad-based black economic empowerment has been part of the political discourse and socioeconomic policy studies since the dawn of democracy. Scholars on both sides of the debate have made persuasive arguments for and against it.

AA has had positive and negative socioeconomic consequences for the country. Employment equity has created a large black middle-class of two-million public sector workers and politicians, as well as a further two to three million in the broader economy

On the positive side this is actually the ruling class. It is also the biggest consumer class. Public sector pension funds have member contributions worth R4bn under management of different asset managers. Together with trade union investments, this class commands strong economic muscle.

Employment equity and the broad AA have come in for criticism largely for lack of a class perspective. The policy has been criticised as elitist, racist, wasteful and divisive — even neo-apartheid in orientation and application. 

The first of these is that it perpetuates the race and class divisions and inequalities of the past and has failed to uplift the majority of black poor and unemployed. Combined, public servants and political elites earn about R900bn a year — almost half of the budget of this financial year. Taxpayers spend R199bn on some 5,000 members of councils and legislatures in the three tiers of state. Compare this budget allocation to the R122bn allocated for 176,000 police officers, R204bn for 17-million beneficiaries of welfare grants and R44bn allocated to the millions of unemployed under the social relief of distress grant.

Second, the inequalities between black public sector workers and politicians and the black majority, are without a doubt widening. This is due to the growing fiscal allocations to the public sector at the expense of the poor black majority. The public sector wage bill has risen from R170bn in 2004 to R700bn this year without any significant improvement in productivity, service delivery or the GDP. Every function of government is deteriorating to the extent that a senior official in the National Treasury has openly said the country is showing signs of a failed state. Many municipalities and some provincial governments are failed states already, despite employee remuneration accounting for in some cases 90% of the budget.

Third, these policies have not advanced social cohesion, despite the extravagant claim by the National Development Plan to that effect. Far from promoting any sort of cohesion, the employment practices of the ANC have turned the public sector into its patronage and clientelism network. This has spawned deep fissures in the black community, enmity between black and black, ageism, entitlement, political factions and a culture of corruption, sexual harassment and institutional failure.

In his book Great Pretenders: Race & Class under ANC Rule, author Ebrahim Harvey correctly accuses the ANC of using race to accumulate riches for themselves through the party’s capture of the public sector (of course using the language of nonracialism and AA). He continues: “… it is its Africanist majoritarian chauvinism which is absolutely the biggest threat to a more progressive definition of nonracialism, especially one in which the better life for all that it repeatedly promised but failed to deliver becomes a reality’’.

The ANC conflates nonracialism with narrow nativism and black majoritarianism. Harvey points out EE has also marginalised the coloured community, a fact which drove many coloureds in the Western Cape to the DA. “I have experienced growing alienation from the ANC since 1994 among coloured people across classes. A combination of aggrievement with basic services in townships and the ongoing and deep problems with the ANC’s Africanist slant in the application of AA policies has taken its toll on both the working and middle classes.’’  The late deputy secretary-general of the ANC admitted: ‘’We are racist in the ANC because we marginalise people who are not black African people.’’

‘’I find social cohesion a very unhelpful concept because it is far too vague and tells us nothing about what exactly in society is cohesive and what and whose specific interests it serves.’’

Fourth, AA as applied in South Africa, through the prism of neopatrimonialism, undermines black pride, trust and social capital, particularly among blacks and coloureds. Anyone who grew up in a traditional rural community, or under the sway of Black Consciousness, will remember the values of black self-reliance and black solidarity of that era. Our parents and community leaders inculcated a vision where black economic leadership, creativity and excellence thrived. There was much social capital and group solidarity in that society, demonstrated by the culture of co-operatives, letsema, empathy and communalism. The mud schools and churches and communal grazing fields are relics from that era.

However, AA as applied under the ANC is a crude form of social engineering. These policies are used to build a docile, conformist and obsequious black middle class — rewarding those who see no evil, hear no evil and speak no evil; and punishing those who are independent minded and speak against state capture and other egregious forms of abuse of power. To secure the crumbs that the ANC calls jobs, black youth are supposed to crawl and prostrate themselves before the elite and managerial class.

Fifth, is the undermining of black entrepreneurship. The new democratic dispensation was greeted by most black entrepreneurs as an era of equal opportunity to build empires which the founders of African Bank, National African Chamber of Commerce (Nafcoc), Foundation for African Business & Consumer Services (FABCOS) and others, such as Dr Sam Motsuenyane, Dr Richard Maponya, SJJ Lesolang, Roger Sishi and many others, could only visualise.

In the beginning there was a proliferation of start-up firms established by black entrepreneurs, with many resigning from the public service to join the burgeoning service sector and provide consultancy services to the government’s economic transformation programme, the reconstruction and development programme and the plethora of departmental projects. However, after a successful 10 years, the spirit of entrepreneurship — and funding — began to sag due to increasing corruption, favouritism and delayed or nonpayment. Many companies failed, while would be entrepreneurs found joining the public sector the only way to survive or get rich.

As a result, the public sector is bloated with thousands of supernumeraries, while there are no iconic black-owned businesses in any sector.    

Sixth, linked to the ANC’s endemic cadre deployment policy and state capture, AA has undermined economic transformation and development of the country and worsened poverty and unemployment to unsustainable and chronic levels. Since 2013, the public sector wage bill has more than doubled. Transnet and Eskom’s labour costs exceed 66%. The logistics sector is a shadow of its former self under the previous dispensation, with railways, ports and municipal roads at different degrees of collapse.

In his budget speech in February this year, finance minister Enoch Godongwana reported that the government slashed the infrastructure budget by R257bn in the past 10 years while bailing out Eskom to the accumulated amount of R296bn. This correlates with the fast increase of consumption expenditure, particularly salaries, both in the civil service and state-owned enterprises. At the same time, unemployment among young people has soared to unprecedented levels of 70% or so.

What is to be done?

I am afraid employment equity is not the correct policy tool to address the question of economic redress or social justice. Taking a spoon out of a mouth of a white person and putting it into the mouth of a black person doesn’t address any of apartheid’s legacies like unemployment and inequality. Employment equity can only change the racial and gender representation of the workforce. But it doesn’t add value or create jobs. That 38% of blacks are unemployed, while 9% of whites are unemployed is an indictment on the AA policies, not apartheid, as I have demonstrated

As we all can attest, the AA policies only created a small black middle-class that wields enormous political power but which, in Marxist terms, is a class-for-itself. Every year its political arm and the trade union component meet over the bargaining table to increase its own share of the budget without a care for the poor. So there is no economic redress or social justice

Only a growing, diversified, resilient, internationally competitive economy that creates decent jobs can achieve socioeconomic development for all. Only a system of meritocracy in education enrolment, hiring, promotion, remuneration, land allocation and loans can rescue this economy out of the doldrums and put it on the road to recovery, growth, expansion, modernisation and export competitiveness.

Unfortunately the radical woke Left, including Eusebius McKaiser, think that calls for meritocratic appointments are essentially right-wing and seek to return the country to apartheid. Singapore has shown that meritocracy and targeted affirmative action (only in the allocation of government housing, making sure Chinese, Indians and rural Muslims are proportionally represented in housing estates) can achieve sustainable socioeconomic improvements across the racial and class spectrum.

South Africa’s pure race based, unmeritocratic affirmative action has achieved poverty and discontent. Eusebius should rejoice and celebrate the near collapse of the economy and runaway unemployment rate.

Many analysts, who cannot be called right-wing by any means, argue for better socioeconomic indicators and to do away with race altogether. Others call for a combination of race and class, so that once a previously disadvantaged person or family reaches a predetermined income level, the affirmative action policies are no longer available to them.

In 1971, when Malaysia adopted its New Economic Plan, it included affirmative action for the Bumiputera, the Muslim Malay underclass, for a limited period of 20 years. Meritocracy was not excluded as we have done, with disastrous consequences for all.

There is a strong case for South Africans to review the whole system of affirmative action without further delay.

Herman Mashaba is ActionSA President