Business Maverick


Fixing the SA economy with transactional analysis

Fixing the SA economy with transactional analysis
Why is the South African economy failing, not just now, as one might expect, but generally? Without knowing that, how would anyone really know how to fix it, asks the writer. (Photo: Gallo Images)

South Africa is being touted as a poster child for the economic devastation that the Coronavirus can cause. What can the country do about it — or has that horse already bolted?

When I was at university years ago, there was a minor flurry in the field of psychology about a new approach called “transactional analysis”. The idea was a derivation from Freudian analysts and maintained the tripartite personality division so integral to Freud’s analysis: the ego, the super-ego and the id. 

But there was a twist: while Freudian analysis focused on discovering subconscious motivations, transactional analysis (TA) was more direct and practical. This was reflected in its tripartite division: “parent”, “adult” and “child” substituted for Freud’s trio.

The great advantage of transactional analysis is that it is much more accessible and user-friendly than Freudian analysis, which focuses on developing a realisation of unconscious desires. The practicality of TA was reflected in the popularity of the books written by the school’s founder, Eric Berne whose best-sellers included The Games People Play and I’m OK, You’re OK. (We will be getting to the point momentarily).

The popularity of TA has waned over the years, and it never really caught on in academic circles, but aspects of it are present in later psycho-analytic theories, especially those concerned with group interactions and conscious behaviour change.

I’ve always wondered to what extent this simple tripartite division has a political or economic dimension. Odd, I know. But the fact is that when you look at political acts in the economy, so many of these seem to fit very neatly into one of these three categories; parent, adult, child. 

From early on in the coronavirus economic calamity, it was clear that one of the things the pandemic would cause is a telescoping of events; problems that had been bubbling under would be categorically exposed. SAA, for example. Or SA’s burdensome national debt. But it pretty much describes the South African economy as a whole too. If ever there was an economic moment when a fast, global economic downturn was the precise opposite of what SA needed, it was in March 2020. SA has, to quote the classic cliché, been caught without swimming trunks as the tide went out.

It’s become common cause in some political circles to blame this economic downturn on State Capture and corruption, but this misses the point somewhat. Of course, State Capture played a role, but in fact, the SA economy has been in trouble for the past decade. And, even after the “State Capture” political grouping failed to entirely grab hold of the ANC at the Nasrec conference, the economic downturn somewhat surprisingly failed to lift.

The telescoping function that the pandemic has inflicted on SA, in which time speeds up and consequences of past action comes crashing down on your head, has made it all the more urgent to address a simple but as yet unanswered question: why is the South African economy failing, not just now, as one might expect, but generally? Without knowing that, how would anyone really know how to fix it?

The failure of the SA economy has an interesting aspect to it, reflected to me in the difference between what the Treasury has predicted at the start of each year for the economy as a whole and what ended up happening. The consequences for government finances actually delivered at the end of the year were quietly devastating. That difference is illustrated below and it shows that for a decade now, the Treasury has over-estimated economic growth, in some years by 100%. Even when the Treasury slashed its growth estimates, the final result was worse than even their pared-down figure. And every year, they expected the following year to improve. But it didn’t. It got worse.


As the problems accumulated, government finances became less and less stable, borrowing increased and the key economic indicators — the level of the currency, the cost of borrowing, the balance of trade — just got worse and worse. 

What this reflects is not just economic mismanagement but something more; a level of self-deception and denial. You could, if pushed, use a personal analogy: it was like the amorous suitor who thought his or her affections were being returned, but in fact, the prospective lover was singing all the time, “I’m just not that into you”. 

And that’s where transactional analysis has some traction. The ANC often reflects a deep-seated instinct to hop into “parental” mode, and the State of Disaster has seen plenty of that. Some of the more autocratic members of the National Command Council seem to be just in their element issuing directives willy-nilly, sometimes with logic on their side and sometimes without. Just start with the name, “National Command Council”. What does that tell you about their self-perception?

But this has an economic element too, most evident in Trade and Industry minister Ebrahim Patel’s justification for denying local online businesses unfettered e-commerce because it would be “unfair” to brick-and-mortar businesses. As hundreds of people have pointed out now, the invention of the motorcar was not “unfair” to the horse. Cars are more efficient than horses; they won. That’s how functioning economies work; they progress, they reward efficiency, they boost productivity. It’s not rocket science. 

What is notable here is not just the silly idea itself, but the instinct to be morally righteous and pedagogical. It’s like — you guessed it — an attitude your parent might adopt. The ban on smoking and alcohol fits neatly into this category too.

The ANC’s ego is also at work here, most obviously in the decision to allow funerals of up to 50 people. Funerals are a hugely important part of the culture of the ANC’s bedrock constituency, so transparently for political reasons rather than health reasons, they have been given enormous licence. Allowing a deadly disease to spread at funerals is just the kind of foolish, desire-driven, ego-centric, fact-unfriendly act that we associate now with the child-like antics of US President Donald Trump. It’s filled with the irrational wishfulness and wilfulness of youth.

Yet, it would be churlish to put all the Command Council’s decisions into this basket. Contrast these instances with the general good sense that permeates the structure; the fast action, the expert-driven responses, the economic package and the level-headedness of levels. These are all creditable, thoughtful acts of a responsible government working in massively challenging circumstances. 

It’s almost as if you can feel there is an adult in the room; the rationality, the boldness, the adaptability, and the overall good sense. 

So, if there is a moral to emerge out of this mess, let it be this: When a policy is put on the table, what about asking this unusual question: is it the parent, the child or the adult speaking? If it most obviously fits one of the first two categories, don’t do it. If it fits the last, do it.

You could call it, in the parlance of the day, a screening process. BM


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