Opinionista Janis van der Westhuizen 11 August 2020

After Covid-19: When the loot runs out for the ANC’s patron-client machinery

As Covid-19 continues to reshape our world, including global political and economic dynamics, what tensions and contradictions are likely to appear over the next five to 10 years at the national level in South Africa?

Pandemics often become critical junctures or major events that disrupt the existing balance of economic or political power. In Western Europe, feudalism collapsed in the wake of the Black Death causing massive labour shortages and peasant political mobilisation. 

Pandemics also seem to appear during periods of intensified globalisation. Pandemics trigger wide-scale disruption because they speed up pre-existing societal tensions and contradictions. At the global level, many of these are now apparent: besides climate change, inequality will become as divisive in the developed world as it has been in the developing world.

What tensions and contradictions are likely to appear over the next five to 10 years at the national level? Moving from the micro to the macro level, three emerging trends require critical questions. First, as Stephen Grootes recently argued, is the political impact of a growing black market. The growth of the black market in alcohol and cigarettes has set the stage for an explosion of informal economic activity, most of which will go untaxed with considerable long-term political consequences.

No longer the exclusive feature of township life, the middle- and working-class response to creeping personal taxes is likely to see the growing informalisation of business, particularly in personal care and consumption.

Think doggy parlours, qualified physiotherapists, hair salons, personal trainers, private tuition, garden services — increasingly going “underground” (working from home) — lured by lower operating costs and passing these on to customers happy to pay in cash for the generous discount. Drawing on social capital – “I got to you through a friend of a friend” — the state is also likely to lose taxes through bartering. Expect IT wizards to solve wifi problems in exchange for fixing that leaking toilet or architectural drawings for financial advice.

Although these sectors may account for a small part of the fiscus’ income, it adds up, especially if the unemployment rate spirals to the projected 50%. Bloomberg estimates that the South African Treasury has already lost R82-billion ($4.8-billion) in revenue for the fiscal year to July, exceeding the value of the IMF corona loan.

Second, as growing numbers battle to make ends meet, many more will turn to “self-help and survival” groups – a motley crew ranging from small stokvels and burial associations, bona fide NGOs providing food relief and various faith-based, welfare groups to a variety of social interest groups (some with clouded semi-criminal connections), this informalisation of South African life will increasingly also include the middle class hemorrhaged by the economic fall-out from the pandemic.

Many — again, including the middle class — will ask themselves: why should I bother to vote? Why has (insert name of any opposition party here) been unable to stop the rot? Alienated from the established political process, some of the “survival and self-help associations” may develop political ambitions, given South Africans’ disillusionment with the traditional political process. Expect many more disruptive campaigns akin to the recent Gatvol protests in Cape Town. 

Buoyed by the inevitable growth of populist rhetoric from this motley crew will lurk strange new political movements and unlikely bedfellows.

Third, the growing informalisation of economic and political life amid the escalating fiscal crisis will exacerbate existing divisions within the ANC. What happens when there simply is no longer as much loot available to grease the capillary-like networks that lubricate the patron-client machinery? Unable to reform itself from within, would the ANC be forced to do so once the after-effects of a second IMF loan with structural adjustment requirements kick in?

Alternatively, some ANC leaders might advocate allocating a shrinking budget to favour strategic political constituencies. Public sector unions? Sassa grantees or maybe even the security services? Or might the securocrats convince an increasingly nervous leadership that some among the motley crew (NGOs funded by Western imperial forces, or mass protest movements infiltrated by skollies) constitute threats to national security best contained through a state of emergency?

Or might the nailbiting 50% ANC support during the 2024 election give the required mandate to the reformists? DM

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