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The Broederbond: A prototype for State Capture

Ivo Vegter is a columnist and the author of Extreme Environment, a book on environmental exaggeration and how it harms emerging economies. He writes on this and many other matters, from the perspective of individual liberty and free markets.

Many of the ANC’s policies are similar to those of the old National Party, which ran a government with significant socialist traits, along with the same corrupt state-capitalism we see today.

As South Africa sinks further into the socialist swamp, there’s a persistent refrain among the sort of people who think apartheid was not a crime against humanity because whites didn’t gas six million blacks. “I told you so. This is where black government leads,” they say.

It’s an easy argument to make. When “we” (that is, white people), handed the country over to black leadership, it was inevitable that South Africa would go the way of most other liberated countries and sink into corruption and economic ruin. 

We’re there, aren’t we? Corruption is rife, throughout the length and breadth of the public sector. Much of the private sector survives on cronyism and patronage. Basic infrastructure is failing under the weight of incompetence, inexperience and looting. The government is near-bankrupt and the country’s economic future is bleak.

It’s an argument that galvanises much of the right, even though it is a fundamentally racist view that entirely misattributes blame. The success or failure of a country is not premised on the skin colour of its leaders, but on their public policies. 

Before I continue, let me be clear that nothing in the column is intended to absolve the ANC of its record of malfeasance and maladministration. The ANC has been a terrible guardian of the legacy of liberation, and the awful consequences are plain for all to see.

The purpose of this column is to undermine the moral high ground which right-wing critics of the ANC think they occupy. They do not hold the moral high ground. They did not bequeath the ANC a perfectly well-functioning country, which the ANC then proceeded to ruin. 

On the contrary, the government of the previous dispensation is just as guilty of all the things of which our present government stands accused, and that’s not counting the crime against humanity that was the dehumanising and cruel apartheid system.

But we had the cheapest electricity in the world, and it never failed, they say. Yeah, well, not so fast. Only 36% of the country’s people had electricity. In rural areas, this was only 12%. Today, more than 90% of the population has access to electricity, and in rural areas it’s now 80%. 

Any fool, including today’s Eskom with its record-low energy availability factor, can deliver electricity to 36% of the country’s population. Doing so would be equivalent to 14 hours per day of load shedding, which Eskom never reaches by a long way even on its worst days.

It’s true that Eskom let many experienced engineers go in the interests of transformation, and that this was a strategic mistake. It is true that Eskom, like other SOEs and government departments, has been looted by preferential procurement practices and outright tender fraud. 

But let’s not fall into the trap of believing that everything was just hunky-dory under apartheid. It might have been for you, if you were white, but for almost everyone else, it wasn’t.

In 1994, only 53% of the population had access to running water. Today, it’s well north of 90%. Yes, it’s true that our water infrastructure is crumbling due to a lack of maintenance and technical skills. But everything wasn’t normal before the ANC took over.

Under the apartheid government the economy, for the most part, and until those pinko-liberal uitlanders imposed sanctions, was thriving, was it not? 

No, it was not. I addressed a similar point many years ago, and a few quotations from that article are worth repeating. 

The claim that the apartheid economy failed is not some sort of historical revisionism. The question was addressed in 1991 by Terence Moll, of the African Studies Centre of the University of Cambridge, in a paper published in the Journal of Southern African Studies. “It is often claimed,” he wrote, “by analysts right across the political spectrum that the apartheid economy grew ‘exceptionally rapidly’ until the early 1970s. Rarely, however, is evidence provided to back up this claim…. [The] apartheid economy did not surge forward after 1948, as did other developing economies, its comparative output and productivity growth record is poor according to a range of measures, and its share of world and developing country manufactured exports fell steadily from 1955 to 1985, suggesting that the apartheid economy grew curiously slowly and can be said to have ‘failed’—partly because the apartheid superstructure impeded economic development, and partly because of the constraining effects of a range of short-sighted and ill-directed state economic policies.”

In a third-year history lecture, Wallace Mills, a professor at St Mary’s University in Canada, wrote: “Although the National Party government claimed to be committed to capitalism, apartheid involved massive interference in the market; there was little ‘free market’ under apartheid.”

Mills went on to detail the failure of job reservation for whites, in that it caused high wage inflation and skills shortages that weren’t being filled fast enough by the oppressed non-white population. He explained that marketing boards and other protectionist measures that favoured the white farming sector contributed noticeably to rising prices and inflation. By the early 1970s, South Africa was mired in a combination of stagnation and inflation, predating the oil shocks that caused the problem in the rest of the world, and enduring long after the rest of the world got inflation under control and rediscovered economic growth.

In the Concise Encyclopedia of Economics, Thomas Hazlett, professor of law and economics at George Mason University’s School of Law, viewed apartheid as socialism even more clearly: “The now-defunct apartheid system of South Africa presented a fascinating instance of interest-group competition for political advantage. In light of the extreme human rights abuses stemming from apartheid, it is remarkable that so little attention has been paid to the economic foundations of that torturous social structure. The conventional view is that apartheid was devised by affluent whites to suppress poor blacks. In fact, the system sprang from class warfare and was largely the creation of white workers struggling against both the black majority and white capitalists. Apartheid was born in the political victory of radical white trade unions over both of their rivals. In short, this cruelly oppressive economic system was socialism with a racist face.”

So the apartheid government, for all its anti-communist rhetoric, was to a great extent socialist in nature, just like the present ANC government. For that same reason, it was failing, economically. 

It has nothing to do with race, and everything to do with economic policy. The world’s great failed socialist experiments have been led by people of all colours and creeds, and the Afrikaner Nationalists were among them.

There are two reasons why the ANC, like most liberation organisations, clings to socialist doctrine. The first is that the colonial powers of the West pushed liberation movements into the arms of the communist Eastern Bloc, way back when. Our leaders got their degrees in Moscow, Havana and other bulwarks of Marxist ideology. When socialism is all you’ve ever been taught, and it’s been drilled into you that capitalism and oppression are synonymous, it’s hard to change your mind.

The second reason is that the ANC inherited a socialist-leaning state apparatus from the apartheid government. It not only emulated what it learnt in Soviet universities and training camps, but it also learnt from the former colonial masters how a government ought to be run. 

For every harmful ANC policy one could blame today for the country’s misery, there is an apartheid-era equivalent. 

The ANC runs a bloated, overpaid and inefficient civil service, in order to give jobs to black people in general, and its constituency in particular. The National Party ran a bloated, overpaid and inefficient civil service, in order to give jobs to white people in general, and its voters in particular. 

The ANC runs state-owned institutions as centres of job creation and poverty alleviation for its own constituency, just like the apartheid government did. At the South African Railways, the South African Post Office, the South African Police, the provincial education departments, and all those other government institutions, white kids who were not likely to succeed in the private sector could be guaranteed to find an undemanding job and a subsidised house, with a paycheck sufficient for a clapped-out Ford and a dead-end life of alcoholism and domestic violence.

What has changed?

Of course, nowadays we stand appalled at the scope and depth of so-called “State Capture”. Even here, however, the ANC learnt from the former oppressors. In 1918, the Afrikaner Broederbond was formed as a secret society for white, Afrikaans, Protestant men, to promote their own interests.

The Broederbond established a power network that is largely credited with the rise of the National Party to power in 1948, and the establishment of the independent Republic of South Africa in 1961. This was the same party that toyed with entering World War II on the side of the Nazis. 

It was the driving force behind the conservative, moralistic tenor of apartheid rule, which denounced a wide range of “sins” from dancing and pop music to interracial relationships as “immoral”.

It was closely associated with the Nederduitse Gereformeerde Kerk, which would eventually give apartheid divine cover. 

Every prime minister and state president from 1948 to 1994, up to and including FW de Klerk, was a member of the Afrikaner Broederbond. 

It secretly controlled senior political appointments, government policy, state-owned enterprises and crony-capitalist corporations like Nasionale Pers (surviving today as Naspers), Altech (today, ADS), Rembrandt Limited (today, Remgro), and several major banks (today amalgamated into the creatively-named Amalgamated Banks of South Africa, or Absa). 

If you wanted a senior appointment, you had to be a member of, or at least on-side with, the Broederbond. If you wanted juicy government contracts, complete with the kick-backs and facilitation fees that they involved, your Broederbond membership would swing the tender in your favour. 

State Capture has been a thing ever since states gained powers worth corrupting, of course. It wasn’t invented by the Broederbond. They did, however, formalise and institutionalise the process, much like the Freemasons or Ku Klux Klan did elsewhere. The ANC is doing nothing new or unique. 

The Broederbond survives today in the form of the Afrikanerbond, a strictly Christian organisation established in 1994 to comply with the requirements of the Interim Constitution. It still has as its goal to “maintain and expand Afrikaner interests”, retains the old Broederbond motto, “Be Strong”, and sports a modernised version of the old Broederbond logo. It recently celebrated the centenary anniversary of the Broederbond.

The only difference is that it no longer controls the state and the commanding heights of the economy. That now falls to a new class of nationalists, virtually identical in every respect except skin colour to the old nationalists.

That the South African economy is collapsing today does not reflect positively on the apartheid regime. Many of the ANC’s policies are similar to those of the old National Party, which ran a government with significant socialist traits, along with the same corrupt state-capitalism we see today.

Today’s South Africa, and indeed the fate of many liberated countries in Africa, is a consequence of socialism and corruption, neither of which is something new and unique introduced by black rulers. The old colonial powers, including the apartheid regime, were past masters at cronyism and the belief in state-led economic development.

Politics should be about promoting and opposing policies, not people. Socialism, nationalism, cronyism, and unquestioning loyalty to the state are toxic no matter who preaches it. DM


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