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State Capture: It’s criminal, and it is nothing new


Floyd Shivambu is deputy president of the EFF. See his Wikipedia profile here.

The South African media has in the recent past made reflections on the question of state capture, largely as a follow-up to the reflections the Economic Freedom Fighters gave on the Gupta family’s influence after the reshuffling of the Minister of Finance in December 2015. We correctly argued that we should never agree, as this generation, to be puppet-mastered as if there are no rules and principles that govern this country.

The EFF calls on all South Africans to stand up against the Gupta kleptocratic syndicate, because at this rate we will soon be left with no country. Now that their National Treasury capture has failed, they will resort to other means of looting.

Prior to the factual revelations of what exactly occurred with the removal of Nhlanhla Nene as Minister of Finance, the EFF had rung alarm bells regarding the replacement of Ngoako Ramatlhodi with Mosebenzi Zwane as Minister of Mineral Resources as a Gupta machination, due to the latter’s close relationship with the Gupta family. Zwane previously redirected millions to the Gupta family and signed the invitation letter that landed the Gupta plane at the Waterkloof air base. A few weeks after his appointment as minister, Zwane accompanied the Guptas to Switzerland to negotiate a business transaction with Glencore, which itself is known all over the world for its tax avoidance practice.

There are of course many Gupta captures and influences on many aspects of the state, but South African media’s lack of sophistication and utterly sluggish investigative capacity keep what are reachable secrets as secrets. There is an adequate legislative framework that can guarantee ordinary South Africans and the media access to crucial information, yet no one genuinely pursues such because most parts of the media represent interest of big corporations. The facts that Des van Rooyen arrived with advisors at the National Treasury and that a contingent of National Treasury staff members almost resigned was first made public by the EFF, and the media caught up very late.

There are still many revelations we are going to make about the Gupta corruption, and we will do so at the right time.

With the current legislation that guarantees access to information, credible sections of the media should have identified and quantified the number of contracts Gupta companies and subsidiaries have with the state. Such must be revealed because there has never been one single business empire in South Africa that monopolises state contracts in the manner that the Gupta family has done. This is where the question of state capture comes in, and we as revolutionary political activists provide thorough ideological analyses on what state capture is.

Ideologically and analytically, the question of state capture has not been sufficiently addressed, due to the obvious reasons that the ruling party lacks proper ideological tools of analysis – and the less said about the other opposition parties, the better. So we take this opportunity to provide a proper ideological analysis of the phenomenon of state capture in a capitalist system, and hopefully such will prove enlightening. This ideological characterisation of state capture is, like all previous reflections, not hubris, but a humble contribution to discourse.

The correct Marxist-Leninist characterisation of the state is that it is a product of the irreconcilability of class antagonisms, and always an instrument of class domination by the ruling class. In any capitalist society, the state is an instrument of class oppression, utilised to minimise and eliminate any resistance to the capitalist accumulation path. Governments, in this instance, constitute a vital and central role in conditioning the continued oppression and exploitation of the working class by the capitalists. Conspicuously, the state seeks ways to legitimise itself and capitalist exploitation through non-cohesive instruments of class rule, such as education, media, religion, and narrow nationalism.

This Marxist characterisation of the state, as captured in the Manifesto of the Communist Party by Karl Marx and Frederick Engels, is important to highlight:

Each step in the development of the bourgeoisie was accompanied by a corresponding political advance of that class … the bourgeoisie has at last, since the establishment of Modern Industry and of the world market, conquered for itself, in the modern representative State, exclusive political sway. The executive of the modern state is but a committee for managing the common affairs of the whole bourgeoisie. (Marx & Engels, 1848)

This perfectly defines South Africa since its emergence as a capitalist state that used racism and sexism to subjugate and exploit the majority for class interests. Capitalists in South Africa, particularly the Chamber of Mines in the early discoveries of precious mineral resources, captured the state and introduced racist laws which would guarantee them maximum profits to the exclusion of the black majority. For a considerable amount of time, the Chamber of Mines represented a fraction of capital, a section whose interests could only be served through racial segregation, deprivation of land and introduction of taxes for the black majority, so that they are forced into wage labour.

Throughout history, various English capital factions in South Africa, largely in the minerals-energy complex, played a central role in determining the agenda of the state. This space was contested post-1948 heavily by the emerging Afrikaner Nationalist capital, which sought to be a genuine competition to what was characterised as predominantly English capitalist interest. The core base of Afrikaner capitalist factions was agriculture, and financial services, and their ideological arsenals were in the Broederbond, the church and the Afrikaans-speaking universities. This was so for many years, and boosted Afrikaner racist egos, and of course determined the agenda of the state, including influence on appointments of key Cabinet ministries.

Owing to the fact that it suffered the most from the sanctions imposed on South Africa and its role in initiating the discussions that led to genuine political dialogue, which in turn led to a negotiated political settlement (also negotiated economic subjugation), the mining capitalist faction had a decisive say and influence over the content and form of the transition from political apartheid to continued economic apartheid. The interests of mining capital in the 1980s were best summarised by Clem Sunter, who held various positions in Anglo American and wrote in a book defining possible scenarios of South Africa’s transition from apartheid to a post-apartheid system: “Negotiation works. Rhetoric is dropped, reality prevails and in the end the companies concerned go on producing the minerals, goods and services.” (Sunter, 1987).

Towards the end of apartheid, various capitalist interests and factions were largely united on the replacement of apartheid with a system that will guarantee continued capitalist exploitation. This reality is perfectly illustrated – towards the release of Nelson Mandela and other political prisoners and unbanning of political parties, FW de Klerk consistently consulted with both the Ruperts and Oppenheimer families. It is a recorded fact that Derek Keys, the last Minister of Finance under apartheid and first under the democratic dispensation, was put forward by the Rupert family.

When Mandela came out of prison, he too had constant engagement with various capitalist interests, and specifically engaged with the Ruperts and Oppenheimers on key political decisions. This is reflected in the first Cabinet of President Mandela. Derek Keys continued as Minister of Finance, Pik Botha was Minister of Mineral Resources and Kraai van Niekerk was Minister of Land and Agrarian Reform. What this means is that the ANC inherited the state that was already captured by interests of white monopoly capital, and after they had converted key members of the then-Cabinet into their agenda, there were no more worries about continuation of the capitalist agenda that had captured the state. The successor to Derek Keys as Minister of Finance was Chris Liebenberg, who was seconded by the Oppenheimer family-controlled Brenthurst Group.

The adoption of the Growth, Employment and Redistribution (Gear) programme in 1996 under the ideological guidance of then-deputy president Thabo Mbeki was manifestation of state capture by international capitalist interests, who in the period leading to the 1994 general elections had invaded South Africa to execute economic policy coup d’ etat. As a matter of fact, Derek Keys signed the General Agreement of Trade and Tariffs on 24 April 1994.

Under President Mbeki, established white monopoly capital was comfortable with Minister of Finance Trevor Manuel, who evidently had a relationship with the Oppenheimer family before the unbanning of the ANC. In his authorised biography, a dramatic record is given of how Trevor Manuel organised Vergelegen (the Oppenheimers’ wine farm) as the first meeting venue of the ANC after the unbanning. Well, it looks like since the first visit to Vergelegen, the ANC, and particularly Trevor Manuel, still have not come back.

Now, despite these factual influences of the ruling capitalist class in South Africa, we should never believe that capitalist interests are always homogenous. The development of capitalism in South Africa and many other parts of the world reveals a reality that there exists intra-capitalist rivalry, sometimes defined by the nature of business the capitalists are engaged in. Various factions of capitalist interests always seek to exert hegemony over the state for their own private purposes. At all times, nonetheless, capitalist states are always hostage of the capitalist class. Captured states always protect the interests of the capitalist class, and the large-scale massacre of workers in Marikana in August 2012 was a manifestation of our captured state.

What South Africa is currently experiencing under Jacob Zuma is a form of criminal state capture by a family that is in business with Zuma.

Jacob Zuma is a business partner of the Guptas and uses his son as a proxy in almost all businesses of the Gupta family. The Guptas then abuse the fact that they are in a corrupt business relationship with Zuma to bully government departments and state-owned companies into illegally siphoning money from the state into their own pockets.

The extent of the Guptas’ state capture is far deeper and wider than has been reported in the less inspiring newspapers of South Africa. The Guptas control many government departments, provinces, and state-owned companies in a manner that far exceeds any of the capitalist control in South Africa. Their attempt at capturing the National Treasury was a final masterstroke which would have affirmed South Africa as a Gupta Republic. The attempt to capture National Treasury is informed, among other things, by their taking billions of rand outside the country.

Of course, other factions of capital, particularly the established white monopoly capitalists, are not pleased by the activities of the Guptas, hence they used their power to instruct Zuma in December to un-appoint Desmond van Rooyen as Minister of Finance. The established white monopoly holds tremendous power over the economic direction of South Africa and has links with international capitalist interests in the country. The amount of power they have can destabilise the South African economy, weaken and effectively deprive South Africa of its currency in the same manner Zimbabwe was deprived of a worthwhile currency. Capitalist opposition to the Guptas’ state capture is upon realisation that the Guptas can displace them from positions of influence and continued profit maximisation.

As a revolutionary movement, which decidedly fights for the interests of the working class, we as the EFF do not and have never taken sides on intra-capitalist rivalries. We oppose all forms of state capture, whether by established white monopoly capital or by a corrupt family which takes advantage of their business partner’s lack of sophistication and general love for quick riches.

This explains why the EFF is the most vociferous opponent of white monopoly capitalists and even organised the biggest protest action against white monopoly capital, to the extent that our opposition to white monopoly capitalist interest is sometimes confused with opposition to white settlers. The primary enemy in the struggle for economic freedom is white monopoly capital, and that has never meant that we will turn a blind eye to the Guptas or to African exploitative and murderous capitalists who capture the state for their own private benefits.

The EFF fights against all capitalists because by its very nature, capitalism is exploitative, murderous, greedy and – in the South African (or even global) context – fundamentally racist. The immediate tasks and functions in the war against capitalism are to take political power from those who surrender it to capitalists and give real power to the working class, in other words those who do not own the means of production.

The solution to state capture is to remove the ANC from political power, and we must not be apologetic about that. Ultimately, the means through which we will remove the ANC from political power is through elections. This does not mean, however, that other means to remove a captured state will not be explored, because under capitalist states, electoral outcomes are not the true reflection of the people’s wishes and interests. Electoral outcomes in capitalist societies are often a reflection of the size of the budget for election campaigns, and not the will of the people. DM

Floyd Shivambu is Deputy President of the EFF.


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