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Mandela’s economic legacy

9th December 2013

Mandela’s economic legacy

By Michael Roberts

The death of Nelson Mandela reminds us of the great victory that the black masses of South Africa achieved over the vicious, cruel and regressive apartheid system first encouraged by British imperialism and then adopted by a reactionary and racist white South African ruling class to preserve the privileges of a tiny few. Mandela spent 27 years in prison and the people he represented fought a long and hard battle to overthrow a grotesque regime, backed by the major imperialist powers, including the US, for decades.

Despite the efforts of the British Conservatives, particularly under Margaret Thatcher, the winer and diner-in-chief of all reactionaries globally, and the other imperialist leaders, the South African regime was eventually brought to its knees by the sacrifices of millions of black South Africans: the labour forces in the mines; the children in the schools and the people in the townships. They were backed by the solidarity actions of workers and people in the major countries through boycotts, strike action and political campaigning. It was a big defeat for the forces of reaction in Britain and America.
But the timing of the end of apartheid was also due to a change of attitude by the white ruling class in South Africa and the ruling classes of the major capitalist states. There was a hard-headed decision to no longer consider Mandela ‘a terrorist’ and recognise that a black president was inevitable and even necessary. Why? South Africa’s capitalist economy was on its knees. That was not just because of boycotting, but because the productivity of the black labour in the mines and factories had dropped away. The quality of investment in industry and availability of investment from abroad had fallen sharply. This was expressed in the profitability of capital reaching a post-war low in the global recession of the early 1980s. And unlike other capitalist economies, South Africa could find no way of turning that around through the exploitation of the labour force.

The ruling class had to change strategy. The white leadership under FW de Klerk reversed decades of previous policy and opted to release Mandela and go for black majority government that could restore labour discipline and revive profitability. For his deserts, De Klerk got the Nobel Peace Prize along with Mandela, who became president at the age of 76! And profitability did indeed rise dramatically under the first Mandela administration as the rate of exploitation of the workforce rocketed.

The rise in profitability tapered off in the early 2000s as the organic composition of capital rose sharply through increased mechanisation even though that yet a further rise in the rate of exploitation. South African industry is now in difficulty, unemployment and crime remain at global highs and economic growth is foundering.

South Africa under Mandela and later Thabo Mbeki has seen some improvement in the truly awful living situation of the black majority, in sanitation, housing, electricity, education, health etc, ending the cruel and arbitrary control of movement and the inequality of the apartheid regime. But South Africa has the highest inequality of incomes and wealth in the world still and inequality has never been higher as black capitalists have joined the white ones in the economy. Despite its professed socialist ideology, the ANC never went towards replacing the capitalist mode of production with common ownership, not even of the mines or resource industries.

As the OECD put it their report on inequality of income in emerging economies: “At one extreme, strong output growth during the past decade went hand-to-hand with declining income inequality in two countries (Brazil and Indonesia). At the other extreme, four countries (China, India, the Russian Federation and South Africa) recorded steep increases in inequality levels during the same period, even though their economies were also expanding strongly.”

The tiny mostly wealthy white minority have remained pretty much unaffected by the ending of apartheid rule. Again, as the OECD put it: “This is a particularly serious challenge for South Africa, where geographical divides reflect inequality between races. Although real incomes have been rising for all groups since the end of apartheid, many Africans still live in poverty. At any poverty yardstick, Africans are very much poorer than Coloureds, who are very much poorer than Indians/Asians, themselves poorer than whites. “

And now the rich whites are joined by rich blacks who dominate businesses and exert overwhelming influence over the black leadership of the ruling ANC party. The ANC expresses the sharp divisions between the majority of working class blacks and the small black ruling class that has developed. These fissures erupt every so often as yet without a decisive break (as we recently saw with the shooting of striking miners by police under a black government). Mandela’s legacy was the end of apartheid; the struggle for equality and a better life continues with subsequent generations of his people.
Taken from Michael Roberts’ blog at http://thenextrecession.wordpress.com