THE TURN TO THE RIGHT COSATU’S ECONOMIC POLICY IN THE POST-APARTHEID PERIOD

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Oupa Lehulere argues that over the last ten years COSATU has moved from being a militant socialist organisation to becoming an organisation whose policies are now acceptable to the capitalist class in South Africa.

Over the last few weeks the South African textile and the mining industries have each announced the loss of thousands of jobs.

Over the last ten years there have been periodic announcements of this kind, and it is now accepted that post-apartheid South Africa has seen a “job-loss bloodbath”. According to COSATU, unemployment has risen from 15 percent in 1995 to over 30 percent in September 2002. The high rate of unemployment, however, is just one part of a broader process of the impoverishment of the working class since 1994. As COSATU President Madisha said, “in 1995 35 percent of workers earned less than R1000 per month. By 2002, almost 40 percent of the employed earned less than R1000.” Whenever these major announcements of job losses are made, debates about the economic policy of the ANC government flare up. In many cases, COSATU intervenes in these debates. As a formation that claims to represent the interests of the poor, the views of COSATU on economic policy are important. After all, at its launch in 1985 COSATU argued that it has “a historic leadership role to play in leading the deepening struggle against national oppression and economic exploitation”. In the minds of many workers, COSATU was not just a trade union, but it was also identified with the struggle for socialism.

Since 1994, and even before, COSATU has steadily abandoned its socialist principles in favour of a mixture of reformist social democratic and neoliberal policies. The first important shift in economic policy emerged with the Reconstruction and Development Programme (RDP), which was consolidated with the publication, in 1996, of the Social Equity and Job Creation (SEJC) paper. While COSATU’s shift to the right has gone through many phases, I will focus on the SECJ, since this document opened the path that has led COSATU to its present mixture of social democratic and neoliberal policies. The SEJC shows a shift at a number of levels:

• Shifts in COSATU’s analysis of the problems of South Africa’s economy;
• Changes in the economic goals and strategies;
• Changes in methods of achieving its economic policy goals.

Shifts in analysis

At its 1992 economic policy conference, COSATU argued that the problems of South Africa’s economy were due to the system of racial capitalism. In the SEJC, COSATU no longer identifies capitalism as the problem, but argues that the problems of the economy are due to the mismanagement of capitalism by the old order. It argues that the “concentration of economic power is due to competition policies”, and that “speculative activity” has promoted “unproductiveeconomic activity instead of investment in plants, equipment and people”. This analysis is not true on a factual level. For example, only in the early 1990s, but especially in the mid-1990s, did speculative activity became a major factor in the South African economy.
The SEJC blames “bad capitalism” for the problems faced by the working class and the poor in South Africa, and does not identify capitalism itself as a source of this impoverishment and inequality. The SEJC orientation argues that while the apartheid government mismanaged capitalism and allowed a bad capitalism to flourish, the new government should inaugurate a “good capitalism” that will lead to social equity for all. Thus, instead of an analysis of economic concentration and monopoly that demonstrates that these are inevitable results of the processes of capitalism, the concentration of economic power is presented as result of “weak competition policies”.

Changes in COSATU’s economic goals and strategies

The SEJC goals are: the substantial redistribution of wealth; the eradication of poverty; the promotion of worker rights; increased employment; the development of the full human potential of our people; and the provision of basic infrastructure and services to all citizens. The federation had travelled a long way from its 1992 platform, where the goal was “to promote the working class as the dominant political and economic power”. In the SEJC, COSATU clearly identifies goals that will not change the capitalist system, but which can be achieved within the capitalist framework.

The SEJC platform identifies 11 pillars to “create jobs”, for example, it proposes to “modernise our industrial base”, “to train and develop the workforce”, to “raise productivity”, and to lower tariffs. According to COSATU, “A major means to foster job creation is through the modernisation of our industrial base. A more efficient industry is able to win back parts of the domestic market that have been lost to imports. It is the essential platform from which to launch a successful export effort”. This adoption of export led strategies is the primary cause of the present wave of job losses in the clothing and textile industries. What the platform does not confront is the fact that under capitalism any significant increase in productivity will be accompanied by job loses. For example, productivity increased by an average of 3.5 percent per worker throughout the 1990s, and this was accompanied by massive job losses.

With respect to the strategy of capturing the domestic market, COSATU also fails to understand the dynamics of capitalist development. The history of capitalist industrialisation shows that countries do not first become ‘efficient’ and then capture the domestic market. Countries must first capture the domestic market, and then become efficient as they accumulate enough capital to invest in expensive technology. Strikingly, the SEJC does not even entertain the possibility of import substitution, and this is linked to its embracing of neo-liberal myths of ‘open economies’. According to SEJC, “the trade union movement accepts the need to open our economy”, and “ we need a pragmatic programme which lowers tariffs carefully [on terms] required by the [WTO]”.

The turn to the right: COSATU’s economic policy in the post-apartheid period The approach of COSATU in the SEJC differs sharply from its 1992 strategy, where it argued that in order to realise its economic goals the state needs to ‘nationalise the commanding heights of the economy’.

Changes in methods

The analysis of the sources of social inequality in South Africa reflects the SEJC’s most important weakness. The document failed to identify the social forces that will drive its programme and those that will oppose it. Although the document attacks business for its neoliberal programme, the emphasis of its criticism is because capital “seeks to repudiate key elements of agreements reached by their representatives with labour and government.” The critique of capital is based on the failure to stick to agreements, rather than on the fact that the system they promote is the primary cause of poverty in South Africa.

When it comes to identifying the (alliance of) social forces that will drive the programme forward, the SEJC represents a step backward from the RDP. Instead of a strategy that seeks to draw the entire working class into the process of social change, or as the RDP says, the people and civil society, the SEJC only focuses on unionised workers.

The main approach of the SEJC was to incorporate trade unions into the existing power structures so as to amend the worst aspects of capitalism. A case in point is its position on the World Trade Organisation, which says: “The WTO has become the major institution driving the globalisation of the world economy. yet the terms of such globalisation are not discussed with the trade union movement. We propose … the WTO to include labour, business and NGO representatives in its governing structures” (COSATU, 1996). This is counter to the positions adopted by the anti- globalisation movement, which has argued that the WTO should be disbanded and replaced by a new more socially just global economic order. Within South Africa, the SEJC talks about “breaking the stranglehold of big business in the economy”. But even here the focus is on making capitalism better with proposals like “a new anti-trust policy” that “will address these problems”.

The approach of partnership with the capitalist class, which began with the SEJC document, has been developed further over the last ten years. In his address to the Growth and Development Summit in 2003, COSATU’s secretary Zwelinzima Vav argued that: “Collectively, we must find ways to address our economic situation.” This was said in a context in which, on the one hand, profits have been soaring, government finances have been improving, and government rating amongst capitalists has been high. On the other hand, however, the working class has become poorer.

The road to the right

Although COSATU has occasionally differed with the ANC and even staged national strikes against aspects of the government’s economic policy, it has consistently moved to the right since the adoption of SEJC. The acceptance of capitalism as a system can be seen in the way the federation and its affiliates have set up investment companies. Many of these companies have been involved in buying privatised enterprises. From a federation that struggled for socialism and for radical economic change, the federation now promotes strategies like the Proudly South African campaign, cooperatives, promotion of small business and so on. COSATU now also supports so-called ‘public- private partnerships’, which are used by the state to promote privatisation. COSATU’s present call for the rand to be weakened is also consistent with its strategy of supporting exports as the engine of growth, a strategy promoted by neoliberals.

Over the last ten years COSATU has moved from being a militant socialist organisation to becoming an organisation whose policies are now acceptable to the capitalist class in South Africa.
Oupa Lehulere works at Khanya College and is active in the social movements. He is also a member of the editorial collective.

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