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19 November 2017 12:18 (South Africa)
Politics

Big surprise: Cosatu wants wholesale change to the economy

  • Branko Brkic
    branko3048 a ray
    Branko Brkic

    Brkic is the founder and editor of The Daily Maverick.

    He has edited magazines on business and politics, technology, and wildlife. He has also published fiction and non-fiction books, most of them in Serbian. Though he has never pretended to be a reporter, his wide knowledge of politics (especially in America), combined with his experiences in a disintegrating Yugoslavia, gives him an unusual outlook on events in South Africa.

    Despite the vowel-poor surname, he tells anyone who asks that he hails from Hyde Park, Johannesburg, having spent most of his adult life in South Africa.

    Recent columns:

  • Politics
vavi - economy

Cosatu clearly belongs to those who believe this economic crisis is a terrible thing to waste. It wants a massive structural change to the economy, claiming that’s the only way out of the crisis.

Cosatu’s central executive committee met earlier this week, and after being briefed by three cabinet ministers (difficult to imagine that happening under Mbeki), decided to “report back”. Zwelinzima Vavi being Zwelinzima Vavi, wasn’t going to let his “policy” press conference be hijacked by talking politics. So he split them up, and he’ll talk politics next week. Brilliant player that he is, he now gets two bites at the media cherry pie.

Vavi and his fellow workers are always going to call for “wholesale” change. After all, if you’re a worker belonging to Cosatu, you’re hardly likely to be one of capitalism’s big winners. But this time, Vavi has come armed with an economic plan. It contains something old, something new, something borrowed, and of course, something red. Quite a bit red, actually.

Let’s start with that old Cosatu saw, “inflation targeting has killed this economy and killed jobs”. And Cosatu believes government “has no dubious motives” when it says it’s willing to discuss the mandate of the Reserve Bank. Currently, the finance ministry’s letter to the bank asks it to keep inflation between three and six percent, thus it uses interest rates to keep it there. Cosatu is now to “debate vigorously” with the finance ministry on this. Cosatu’s not wrong, in that lowering interest rates would lead to more jobs. It would also lead to higher inflation and people with jobs would find they have less money in their pockets, and that’s worth avoiding. When asked directly if he thinks the end of inflation targeting is near, Vavi doesn’t appear to be confident enough to say “yes”. He hedges a little.

The something slightly new is the currency. Vavi believes the rand is simply too strong. He wants it to go back to R10 to the dollar. And this time, he says Cosatu’s willing to enter “tactical alignments” with business and other sectors of society. An interesting alliance that, Cosatu and business. Being unholy enough, it might just work.

And on to the something borrowed; power, in this case. Cosatu doesn’t really have it, and the ANC does. So, to borrow Business Day’s Karima Brown’s favourite question (and it’s a goodie); how is Cosatu going to get the ANC to do what it wants? This elicits exasperated sighs around the table. Well, from the officials at least; a slight quickening from the journos. Eventually, Cosatu’s president Sdumo Dlaimini gives a half answer. “It took us 10 years to get policy changed on Aids, 10 years to get it changed on Zimbabwe”. In essence, he says, change will come, but it’s a slow process.

He’s borrowed that line from the communists, who still claim “socialism will come eventually”. But it does beg the question then, what about comments like those from ANC treasurer Mathews Phosa, who told investors in London recently, “we will stick to conservative macro-economic policies”. That really does seem to make nonsense of Cosatu’s claims, doesn’t it?. “Aha,” says Vavi, “if you take every utterance from an ANC leader seriously, you’ll end up in a mental hospital. The ANC is a broad church, and we rely on what we hear in the alliance summits.” Ok, that clears it up then. So, you believe what you’re told behind closed doors, and not what is said in public. Basically, Vavi says Phosa is talking rubbish.

Cosatu is clearly very conscious that there are those who claim the nationalists in the ANC are beginning to win the war against the leftists. That its supporters, and certain cheerleaders in the media are realising that Jacob Zuma is now president, and the economy is still almost exactly the same. It also knows that if you push too hard, you’ll get a massive response. And so it’s got to thread a needle carefully, lose a battle here and there, and hopefully you’ll win the war in the end. Vavi knows this too, and is quick to say, “those who have been singing of the death of the left; I hope they’ll be eating their words soon”.

Is he right? How much influence does Cosatu actually have? Watch the argument over the Reserve Bank’s mandate.

By Stephen Grootes

(Grootes is an Eyewitness News reporter)

Photo: REUTERS

  • Branko Brkic
    branko3048 a ray
    Branko Brkic

    Brkic is the founder and editor of The Daily Maverick.

    He has edited magazines on business and politics, technology, and wildlife. He has also published fiction and non-fiction books, most of them in Serbian. Though he has never pretended to be a reporter, his wide knowledge of politics (especially in America), combined with his experiences in a disintegrating Yugoslavia, gives him an unusual outlook on events in South Africa.

    Despite the vowel-poor surname, he tells anyone who asks that he hails from Hyde Park, Johannesburg, having spent most of his adult life in South Africa.

    Recent columns:

  • Politics

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