Opinionista Pierre De Vos 21 August 2019

On the money: Political funding transparency will make it easier to thwart corruption

We should not turn a blind eye to how much money CR17 raised and spent during the campaign for the ANC presidency...the revelations shine a spotlight on the outsized influence of money on SA politics.

Politics”, remarked the German-American socialist leader Oscar Ameringer, “is the gentle art of getting votes from the poor and campaign funds from the rich, by promising to protect each from the other.” Until the election of Jacob Zuma as president of the ANC, the model described by Ameringer was also the model used by the ANC and the government it leads; one that President Cyril Ramaphosa attempted to return to during his campaign to become ANC president.

Former president Jacob Zuma and his allies disrupted this funding model by raising funds for the party and for themselves, directly from state-owned entities (and allegedly also from foreign governments or their proxies), or indirectly by getting donations from private companies involved in corrupt tenders with state-owned entities.

This indirect fund-raising system became known as “State Capture”, a system that brought enormous financial riches to those in charge of the private companies that were allowed to “capture” the state-owned entities, as well as to their political benefactors and the political factions and campaigns supported by the “state capturers”.

The Zuma project alienated many of the powerful, rich, private donors associated with the status quo, donors used to buying access (and surely also influence) over ANC leaders and ultimately also government policy.

I suspect the elites turned against Zuma not only because they worried about the ineptitude of the Zuma government and the threat this posed to political stability in South Africa. Neither was the sole cause for their disquiet the rise of rampant corruption, as most private businesses would (if this was required to make a profit) be quite willing to make the compromises necessary to flourish in a corrupt system. Nor was the sole cause for alarm that “State Capture” was, in essence, a criminal enterprise.

My theory is that by turning away from “clean” private funders and raising large sums of money directly through state-owned entities or indirectly through private companies compromised by corruption and “State Capture”, Zuma and his faction weakened the influence of the traditional “clean” funders over the ANC and the government it leads.

The new funders were mostly not interested in influencing government policy and were largely not ideologically motivated – although they attacked their enemies by labelling them part of “white monopoly capital” and by claiming to punt radical economic transformation. Instead, they were interested in extracting as much money from the state as they could.

I suspect that many of the so-called “clean” funders who made really large donations to the CR17 campaign were motivated by a desire to protect the free market, to advance “moderate” economic policies or – a more noble aim – to save South Africa from the inevitable collapse that Zuma-type State Capture would have brought.

In short, they wanted to use their money to ensure the installation of a government they believed would be good for their business and, incidentally, good for South Africa. While the Zuma faction is associated with the corrupt extraction of capital from the state, those who donate to people like Ramaphosa are largely associated with the corruption of the political process.

South Africa is a country in which a significant number of people pick sides based on racial identity. It was, therefore, a master-stroke of the Zuma-type state capturers to brand the kind of people who might fund Ramaphosa as “white monopoly capital”. This turned Zuma into a hero of sorts, not only with the corrupt politicians and businesspeople (aligned with the ANC and the EFF) who benefitted from these schemes, but also with some poor people on the margins of society, and with elites who see themselves as having a more radical political agenda.

It was as if people thought: “Zuma and the State Capture beneficiaries might be corrupt, but they are opposed to white monopoly capital whose money is being used to stop the implementation of radical economic transformation and is keeping us poor and them rich, so Zuma should be supported.”

These groups all harbour deep resentment and anger against the traditional elites who have used their wealth and influence to defend and protect the status quo. And no wonder there is anger: we live in a country of vast and largely racialised inequality. Retaining the status quo benefits the wealthy (at least in the short to medium term) but prevents the complete restructuring of South African society along more egalitarian lines. I suspect some of Ramaphosa’s most passionate supporters fail to understand this political dynamic that makes it easy to paint their man as a servant of those who wish to retain the status quo.

Because many of the most vocal and well-funded opponents of Ramaphosa’s presidency (and of his project to return to the non-criminal form of party-political funding) are either corrupt, paid propagandists, or shady powermongers, and because Ramaphosa promises to look after the interests of both the poor and the wealthy (implicitly, to protect them against each other), some of Ramaphosa’s supporters have shrugged off revelations about the vast amounts of money involved in the election of ANC party leaders. I suspect this is a mistake.

Yes, Ramaphosa would almost certainly not have won his bid to become ANC president if he had not raised and spent the vast amounts of money that he did. Yes, the Nkosazana Dlamini Zuma faction may well have raised and spent even vaster amounts of money (and probably not only from the private sector). Yes, nothing revealed so far indicates any criminal wrongdoing on the part of Ramaphosa or those who managed the fund (although that may change). Yes, if the Dlamini Zuma faction had won at Nasrec, State Capture might have collapsed the state.

But that does not mean we should turn a blind eye to how much money CR17 raised and spent during the campaign. The revelations shine a spotlight on the outsized influence of money on politics (in this case, internal ANC politics). It raises questions about the extent to which political donations influence government policies and are used by the wealthy to protect their interests. Lastly, it reminds us that the way in which the ANC chooses its leaders is far from democratic. In fact, the current ANC electoral system seems to be designed to minimise the influence of ordinary ANC members, and amplify the influence of leaders and the money wielded by those leaders or by others trying to influence the outcome of leadership elections.

In terms of the ANC constitution, branches elect delegates to attend and vote at the national conference. The delegates are allocated based on the size of the membership in the province and the size of the branch. It is easy to boost delegate numbers by creating new branches or by stuffing branches with ghost members.

But once delegates are selected by branches and given a voting mandate, this is not the end of the matter. Nothing stops a delegate from changing his or her mind about whom to vote for at the conference, either in a genuine manner, or after accepting a bribe or some other inducement from one of the campaigns.

There is no way for the members of the branch to check whether the branch delegates voted for the candidates they were told to vote for by their branch. In other words, branches do not decide. Delegates decide. And as there are only 4,500 delegates, it is not that difficult to use money to influence the outcome of the election.

While money will always play a role in party leadership elections, the ANC could minimise this by doing at least two things.

First, it needs to change the system through which ANC leaders are chosen. This could be done by allowing every member in good standing to vote in a secret ballot for leaders of their choice. Of course, it may be difficult to manage such a system and it would be difficult to safeguard against electoral fraud – unless the vote and counting is done at the branch and the outcome is then sent to head office where the results of every branch is placed on a publicly available list (to ensure that no fraud occurs).

Second, legislation should impose obligations on all candidates who run for party leadership positions in all political parties to make public all their sources of income (or at least substantial sources of income – say any donations of more than R25,000) and also make a full public declaration of how the money was spent.

It is not inconceivable that some candidates will cheat by not declaring the names of all their funders or how some of the money was spent. But in principle, it must be a good thing to require transparency in the funding of political candidates. When funding and expenditure are transparent, it will be easier for the public to spot when a politician corruptly favours a specific individual or company who has donated to their campaign, or when a politician advances the broader ideological and economic interests of his or her big donors.

Unfortunately, whatever changes are made to the law regarding the funding of political campaigns, people will continue to fund political parties and politicians in the hope of gaining either a direct financial benefit or of securing favourable government policies or treatment. As George Orwell did not say: “All voters are equal, but some wealthy voters are more equal than others.” DM

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