Libmonster ID: EE-715

В последнее время распространилось мнение о том, что Африка представляет собой нечто совершенно отличное от других континентов. Например, раздаются голоса о том, что Африку даже некорректно сравнивать с Россией - якобы у них слишком разная политическая культура и политическая практика. Предлагаемая вниманию читателей статья, тем не менее, посвящена именно сравнению - сравнению политики двух правящих партий - Африканского национального конгресса в ЮАР и Лейбористской партии в Великобритании. Автор ее сам хорошо знаком с "двумя мирами" - гражданин США, он свыше 30 лет живет и работает в ЮАР. Доктор Фил Эйдельберг - широко образованный человек, в Колумбийском университете он специализировался по России, затем защитил диссертацию по Румынии, опубликовал немало трудов по современной истории ЮАР. Его работы всегда отличает оригинальность мышления, неординарный выбор темы, и в этом сможет убедиться сам читатель.


The present paper seeks to provide a comparison of the policies of the African National Congress (ANC) since 1994 with the policies of Britain's Labour Party since its own coming to power three years later. In particular, I attempt to compare the ways in which each regime, and the society it represents, has adapted to the hegemony of neoliberal ("monetarist") market economics, increasingly evident throughout the industrialized world since the mid 1970s. Both their leaders, Tony Blair and Thabo Mbeki respectively, would call themselves heirs of a "center-left", social democratic or (particularly in Mbeki's case) "progressive" tradition, reaching back at least to the post World War II period. And yet, not only have they made fundamental deviations from that tradition1, but, as this paper will argue, each has done so within a radically different context from the other, reflecting the very different societies in question.

Although the aim of this paper is ultimately to focus on South Africa, considerable attention has been devoted to Britain as well in the hope that comparisons between the two countries will also highlight the fundamental distinction between the contemporary South African political economy and its U.K. counterpart. The Blair government, like the Conservative Thatcher and Major governments before it, is essentially part of the globalist or neoliberal international system - this, despite being under a nominally "Labour" government which until recently has claimed a "Third Way"2 between neoliberalism and social democracy. Thus it has been justifiably said that

1 This is freely admitted by New Labour, but not by the ANC.

2 Admittedly, this term has been less emphasized lately, and was no longer used during Blair's 2005 reelection campaign [Business Day, 9.05.2005, p. 9].

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"the government's work after 1997 lacked a clear organizing theme. Governments that radically change the agenda, as after 1906, 1945 and 1979, have a philosophical cohesion. The Third Way never translated into a practical programme for policy... in the way that [neoliberalism informed] the Thatcher governments" [Seldon, 2001, p. 599]3.

The current South African economy, in contrast to post 1979 Britain, exhibits characteristics to a considerable degree at variance with the current international neoliberal world which Britain epitomizes. In particular it is marked by a de facto one-party state and an unemployment which is not only widespread but in all probability permanent. Ironically, therefore, Mbeki's policies deserve the epithet "Third Way", more than Blair's, even though, in contrast to Blair, he has generally avoided employing the term. And, rather than claiming to practice a hybrid version combining neoliberalism and social democracy, it is argued, the ANC "Third Way" pursues in some respects a different course from either alternative4.

An important theme of this paper is the impact the policies of the ANC and the British state have had on organized labour in their respective societies. Attention will be drawn to the evolution of relations between the British state and organized labour over the past half century. A comparison will also be drawn with the corresponding evolving relationship between the ANC and black labour during this same period, even while the ANC was still operating in illegality. It will be argued that while British labour has been forced, even if against its will, to follow the state and adapt to the Thatcherite monetarist revolution, South African black labour has not adapted, if only because of its tradition of autonomy from the ANC, which has continued since 1994.

Another topic of importance will be to focus on the totally different effect that the monetarist revolution has had on the employment pattern of each country. Whereas it has led to growing unemployment in each society, increasing unemployment in the U.K. has been relatively mild and short- lived compared to the superficially similar phenomenon in South Africa. There, growing unemployment has been on a completely different scale: it has been permanent and it has assumed ever more massive proportions. This in turn has helped isolate the Congress of South African Trade Unions (COSATU) even more, while crucially reinforcing the present ANC one-party state.


Monetarism, as applied in the U.K with the advent of the Thatcher Conservative government in 19795, was known also as "supply-side" economics. Its role was, first of all, to prevent inflation by controlling the money supply, through such measures as regulating interest rates and the currency's foreign exchange rate. This, in turn involved the reduction of direct state administrative interference in the economy, such as price controls, in deference to natural market (capitalist) forces. Such a policy included, at least ideally, also reductions in direct taxation (a move favouring the wealthy) and in public spending, and less government control (including privatization) of industry. With less state interference in the economy, individuals were to be encouraged to pursue more freely their own private capitalist interests. An emphasis was placed on a balanced budget and a stable currency so as to make the economy also attractive to foreign investors [Cockett, 1995, p. 45,247 - 248, 316, 323; Seldon, Collings, 2000, p. 6, 65, 80 - 81, 128 - 129; Reitan, 2003, p. 20, 159 - 160]. In doing so, monetarism recognized the increasing hegemony of international financial markets ("globalism") so evident by the mid 1970s. The Thatcher monetarist policies were in large part to become permanent, to be adopted also by the subsequent Labour governments of Tony Blair from 19976.

3 For the argument that there is a basic continuity between the Thatcher/Major and Blair governments, see also [Howell, 2005, p. 14 - 15, 17, 134 - 135, 189 - 190, 193].

4 For a recent view reiterating the argument that Blair and Mbeki basically share the same political outlook, see [Gumede, 2005, p. 64, 125].

5 And as applied in the U.S. under the new Reagan Republican government from 1981.

6 Likewise, in the U.S., Reagan's monetarism would subsequently be adopted by the Democrats under Clinton (1992 - 2000) and again by the Republicans under Bush after that.

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Keynesianism or "demand-side" ("demand management") economics, which had been rejected by the 1979 monetarist revolution, had been hegemonic since at least 1945. Like monetarism after it, it had been adopted by both major political parties. Demand-side economics, in contrast to monetarism, encouraged expansion of the state sector (including nationalization of industry) so as to control market forces in the interest of the masses of the poor, in particular the "working class". It supported progressive taxation, price controls and increased public spending. Such policies naturally involved encouraging a certain, hopefully mild, degree of inflation (in contrast to monetarism, whose impact was to curb inflation, by its constraints on public spending and emphasis on balanced budgets).

Emphasis was placed on expanding the money supply (and ultimately devaluing the currency) through such policies as lowering taxes on the poor and lowering interest rates so as to stimulate public consumption and increasing public spending. By stimulating demand for increased productive capacity, a policy of full employment was pursued. In contrast to monetarism, for Keynesianism, a policy of making the national economy attractive to foreign investors was definitely secondary to the main goal of encouraging the domestic market, in particular the average domestic consumer.

This emphasis on domestic priorities, in turn reflected the more inward emphasis on the British nation-state so typical of the preglobalist age [Cockett, 1995, p. 41, 44 - 45; Reitan, 2003, p. 20 - 21, 159 - 160]. Stretching back as far as the beginning of the century, this new, collectivist outlook had been greatly reinforced by the advent of the First World War even before the Great Depression of the 1930s [Cockett, 1995, p. 13 - 17; Howell, 2005, p. 14, 46].

Another term for Keynesianism employed by both parties, was the "Middle Way". This term stood for a middle road between "communism" or "socialism" (such as existed in the USSR) and traditional nineteenth century laissez faire capitalism. It was in effect, at least in the case of the Conservatives, a euphemism for a version of the more controversial "social democracy". It supported the coexistence of a private and a state sector of capitalism tempered by a policy of full employment [Cockett, 1995, p. 23, 49]. Ironically, it was the Conservative, Harold Macmillan who wrote the Middle Way, referred to by one author as "the most important contemporary political expression of Keynesianism" [Cockett, 1995, p. 46].

Just as Keynesianism was endorsed by both major political parties of the time [Howell, 2005, p. 93, 98], the same would apply to monetarism from 1979. The first period (1945 - 1979) had already been influenced by wartime government interference so that both parties were already receptive to demand-side economics already from 1945. During the second period, Labour resisted following Thatcher at first but gradually would accept monetarism by the time of the advent of the Blair government in 1994. Both political parties have been committed to the policies of the Thatcher governments including inflation control, less government interference in the economy, low direct taxation and a stable currency. And both have thus shown themselves to be eager participants in the new international investment world of the past thirty years [Cockett, 1995, p. 7, 323; Seldon, Collings, 2000, p. 83].

While the Blair government has tried to argue that New Labour is pursuing a "Third Way" between Thatcherism and Keynesianism [see, for example: Blair, 2003], this argument has not been very convincing. If there was plenty of political space for the "Middle Way" between communism and orthodox nineteenth century laissez faire, there is relatively little space indeed between Thatcherism (in effect a form of revisionist laissez faire) and Blair's own Third Way "revisionist social democracy"7. What changes have been made in favor of socio-economic redistribution under Blair, have, therefore, always been within the basic neoliberal framework. These

7 "We stand in the tradition of revisionist social democracy" [Blair, 2003].

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reforms, in fact have been called "Thatcherism with a smiling face" [Reitan, 2003, p. 175; see also: Taylor, 2001, p. 252 - 253].

A particularly dramatic impact of the monetarist revolution has been its effect on trade unions. It was not simply that monetarists, such as the Thatcher government, were personally hostile to trade union power, but that the monetarist system itself was ipso facto tilted in favour of business at union expense. By making a balanced budget and a stable currency a top priority so as to avoid inflation and thus attract foreign direct investment, monetarism removed any necessity for constant union-management wage negotiations and renegotiations, and, therefore, in a broader sense, any need for union participation in economic policy. Since wage levels were now supposed to be stable, they could more easily be taken for granted and the previous Keynesian "incomes policy" could be dropped [Seldon, Collings, 2000, p. 3; Reitan, 2003, p. 21]. The Keynesian system had been committed to full employment, which in turn could only be pursued by the state's stimulating an expansion of employment demand and thus a certain amount of inflation. Monetarism, on the other hand, by seeking to control inflation as much as possible, was in turn committed against full employment. Here again, the unions were the losers since full employment policies ("demand management") naturally had worked in favour of wage increases [Cockett, 1995, p. 45, 151, 222, 267, 287, 330].

The new monetarist synthesis is often referred to as "neoliberal" so as to distinguish it from classical laissez faire liberalism. As its name implies, it does of course share certain basic similarities with classical nineteenth century liberalism. Thus, trade unions have lost power, industry has been privatised and, since 1979, exchange controls have been abolished [see for example: Seldon, Collings, 2000, p. 68 - 70; Reitan, 2003, p. 243]. But there are also fundamental differences from classical liberalism. The monetarists, for example, retain a relatively strong state, one of whose functions was to ban monopolies so as to ensure a climate of free competition. Likewise, the state is concerned with education so as to encourage, if not equality of achievement, at least equality of opportunity for all. It also deals with health, pensions and fighting crime. A strong state is also necessary to maintain a massive military, permitting Britain increasingly to wage an aggressive foreign policy [Cockett, 1995, p. 113 - 114, 252 - 253; Reitan, 2003, p. 214 - 215, 243].


Inflation is a particularly strong threat to the contemporary South African economy. The smallness of this economy and the fact that it is dominated by relatively few companies hinders competition, keeping prices high. Moreover, the economy is particularly small in view of the fact that the majority of the population are either unemployed or earning very low incomes. This is further aggravated by an increasingly inefficient transport infrastructure (ports, railways and highways are congested and service is thus slow). As a result, such relatively high prices are especially vulnerable to any inflationary pressures [Business Day, 27.07.2004, p. 10; Business Day, 8.09.2004, p. 11].

This economic vulnerability is complemented by the rapidly growing unemployment during the past thirty years [Mail & Guardian, 7 - 13.05.2004, p. 21], a situation whose rate of growth has probably accelerated during the past decade. For the unemployed, largely dependent on relatively inelastic child-support grants with which to buy food, especially maize [Mail & Guardian, 20 - 26.02.2004, p. 39; Mail & Guardian, 7 - 13.05.2004, p. 21], as well as on government subsidised services, any sharp price rise can pose unacceptable risks. The Reserve Bank, representing a government dependent on the unemployed (40% of the population) for votes, naturally feels obliged to make inflation control its first priority, quite apart from economic reasons [Mail & Guardian, 16 - 22.04.2004, p. 37; Business Day, 26.07.2004, p. 6].

Thus support for monetarist policies enjoys, if not always active, at least tacit support from a broad section of South African society. On the other hand, as in Britain, the group most negatively affected by this policy has been of course organised labour which unsurprisingly feels increasingly isolated and alienated from government policy. It is perhaps more than a coincidence that

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as unemployment has increased, monetarism has found less resistance and more opportunities to take root in South Africa. This might help explain why it would be under ANC rule, since 1994, when unemployment reached unprecedented proportions, that monetarism (with its policy of vigorous inflation control) became much more widely accepted than before.

While there were certain signs of an outward turning of the economy already during the second half of the 1980s, most of economic liberalisation associated with monetarism began only from the ANC's coming to power in 1994, ten to fifteen years later than in Britain. This included trade liberalisation in the form of lowering of tariffs; the step-by-step reduction of exchange controls, beginning in 1995; and the government's substantial rationalising of the labour force in the public sector [Strydom, 2002, p. 40 - 42; Mohr, 2002, p. 227 - 228; Sunday Times. Business Times, 25.07.2004, p. 7].

At the same time, the monetarist policy of "inflation targeting" was introduced in 1986, although still on an informal basis. The Reserve Bank retained much leeway in determining the time needed to achieve a desired lower target inflation rate. Nor was a specific numerical target given as to what the new rate of inflation should be. The aim instead was simply to bring down South Africa's inflation rate to the same level as the rates of the country' s main foreign trade partners and competitors. This policy, together with the other measures taken after 1994 was sufficient to help bring down the inflation rate from around 15% in the late 1980s and early 1990s to below 10% at the end of 1992 and to 5.2% in 1999 [van der Merwe, 2004, p. 1, 8; Strydom, 2002, p. 34 - 35].

Notwithstanding this substantial drop in the inflation rate during the previous decade, the Minister of Finance, Trevor Manuel, in his February 2000 budget speech, still felt it necessary to announce the replacement of informal inflation targeting with formal targeting. Initially, the inflation target was set at 3 to 6% for the year 2002 where it has remained since [Strydom, 2002, p. 37 - 38; see also: Manuel, 2005, p. 11]. Monetary policy in South Africa, as in the U.K., made inflation control the centrepiece of its program, to be pursued as rigorously as possible. This view would be reiterated four year later, in July, 2004, in a speech by Tito Mboweni, governor of the Reserve Bank. In his opinion, "continued price stability [was] the most crucial prerequisite for sustained economic growth and development in the years ahead" [Business Day, 27.07.2004, p. 4].

That same month, the Reserve Bank's chief economist, E.J. van der Merwe published a paper on inflation targeting. In it, he justified the transition from informal to formal targeting. Firstly, the new dispensation, because it was more explicit, would be more transparent and easier to understand by the public at large, removing uncertainties in the market. Secondly, an explicit, official targeting would act as a reliable point of reference for facilitating the coordinating of monetary policy with other economic policies [van der Merwe, 2004, p. 1 - 2]. Thirdly, by committing itself officially to an explicit goal, inflation targeting served "to discipline monetary policy and increase the central bank's accountability. Clear targets are set which the central bank has to meet. If the actual inflation rate deviates from these targets, the central bank has to explain what went wrong" [van der Merwe, 2004, p. 2]. And fourthly, official inflation targets would serve as "the basis for future price and wage setting. Like Mboweni, van der Merwe reemphasised "price stability as the primary goal of monetary policy, to which other goals are subordinated" [van der Merwe, 2004, p. 2].

As the third point suggests, the motives of official inflation targeting were not purely economic but also political in that they reduced the independence of the Reserve Bank vis a vis the Ministry of Finance. In contrast to before, the Bank no longer determined the actual inflation target but only the means to achieve this target, i.e. price stability, including determining the interest rate [van der Merwe, 2004, p. 4, 8; Strydom, 2002, p. 38, 48]. This was superficially similar to the position of the Bank of England. Yet there was a crucial difference in implication. In the case of the Bank of England, its subordination to the government's Ministry of Finance ("Chancellor of the Exchequer") made it ultimately accountable to Parliament, and thus the British electorate [Sinclair, 2001, p. 227, 230 - 231]. In the South African case, on the other hand, the Reserve Bank's subordination was to a government of a de facto one-party state with a submissive and passive parliament.

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The ANC has followed a course in certain ways similar to that of British Labour, during the past fifty years. One notable similarity is the evolution in each political movement from a balance of power between capital and organised labour to the emergence of a middle class, capitalist hegemony. Like British Labour, the ANC, since 1994, is very different from what it once was, particularly during the period between 1955 and the end of the 1970s. In both cases, there has been a considerable degree of adaptation to neoliberalism from previous commitments to more egalitarian-oriented societies.

On the other hand, the two movements have diverged in terms of foreign policy. Whereas British Labour has always pursued close ties with the United States during the post war period, the ANC became a close ally of the Soviet Union for much of this time. Although official relations between the ANC and the USSR began only after the ANC had been banned and forced to go underground in 1960 [Shubin, 1996, p. 5; Shubin, 1999, p. 47 - 48], the ANC's orientation away from the capitalist West was evident already in its "Freedom Charter", a document published in 1955.

The Freedom Charter in effect expressed the ANC's basic political and ideological aims at that time. Although the Charter has been described as non-socialist and as moderate on economic issues, it in fact advocated a very radical restructuring of the South African economy at the expense of large-scale white and foreign capitalist interests. This would have meant the nationalisation of these assets, allegedly to the benefit not only of organised labour but also of African entrepreneurs. It would have removed competition within the internal market from domestic white and multinational corporations. In turn, nationalisation would have implied perforce the substantial loosening of ties between South Africa and the international capitalist economy [see on this: Eidelberg, 1999, p. 59].

At the time of its creation, particularly during the late 1950s and early 1960s, the type of society envisaged by the Freedom Charter was hardly unique. It essentially envisaged joining the so-called "non aligned" bloc of countries, such as Egypt, India, Indonesia and Ghana. All these maintained multi-class societies, including both powerful trade unions and their own native bourgeoisie. In addition, they were committed to foreign policies pursuing economic independence from the international capitalist powers, most notably the United States and Britain. This, in effect, made them sympathetic to the Soviet Bloc, while continuing to encourage nonsocialist, multi-class societies [Eidelberg, 1999, p. 59].

In contrast, from 1985, when comprehensive financial sanctions against South Africa were first levied by U.S. banks, the ANC's strategy of overthrowing white rule would increasingly be posited on the support of major western-oriented capitalist interests. Soviet influence over the ANC would wane, to be soon followed by the U.S.S.R.'s actual collapse in 1991. During the 1985 - 1994 period, the ANC could justifiably argue that, in view of sanctions, only its own coming to power would reintegrate the increasingly beleaguered South African economy into the international capitalist world.


In contrast to the black South African trade union movement which would, particularly from the 1970s, be largely independent of the ANC, British unions were always an integral part of the Labour party as the name implies. British labour has tended either to influence the Labour party - the situation before the 1980s, or to be influenced by it, as would in fact subsequently happen. There have been temporary disparities between the Labour government and the Trade Union Congress (TUC), as in the 1970s and early 1980s, but it was not permanent. By the 1990s, the two groups had again converged ideologically.

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The Thatcher government's defeat of the Miners' Strike in 1985 is generally regarded as the most obvious turning point in the subjugation of British organised labour. Sensing that many, even most, coal mines were operating at a loss, the Thatcher government committed itself to closing them down. The leader of the National Union of Mineworkers (NUM)8, Arthur Scargill challenged this policy, arguing that the NUM's aim was, on the contrary, "to defend pits, jobs, communities and the right to work" [Seldon, Collings, 2000, p. 106]. This clash between government and labour unions was a good example of just what divided the old Keynesian philosophy, still championed by organised labour, and the new neoliberal philosophy, emphasising productivity before full employment. In 1986, the government passed the Wages Act which introduced labour market and pay flexibility [Seldon, Collings, 2000, p. 69] - something which the ANC, during the eleven years after coming to power, would still not succeed in bringing about. These reforms would be permanent and accepted by the Blair labour government, from 1997. Trade unions, in turn would themselves adapt and become "more accountable and co-operative with the goals of business" [Seldon, Collings, 2000, p. 93; Taylor, 2001, p. 247 - 248, 265 - 267].

In contrast to their British counterparts, black unions in South Africa have never accepted capitalism, not even today. They are only fighting it differently than in the 1950s, when, under the South African Congress of Trade Unions (SACTU), they formed part of a national liberation movement endorsing the Freedom Charter.

SACTU had originally been founded in 1955, at the time of the publication of the Freedom Charter. It almost immediately joined the ANC's newly established Congress Alliance. In contrast to the subsequent alliance between the Congress of South African Trade Unions (COSATU) and the ANC (established de facto in 1985 and officially in 1990 [Baskin, 1991, p. 431 - 432]), the member organisations of the Congress Alliance formed a tight, organic unity under ANC hegemony. In particular, two of the organisations, the ANC and SACTU, while maintaining identities and historical legacies very distinct from each other, shared identical political views, and were organisationally intertwined.

For example, many of SACTU's members joined the newly formed guerrilla organisation, Umkhonto we Sizwe (MK) in 1961 with Congress's shift to armed struggle after the ANC had been banned by the government, following the Sharpeville crisis [see: Shubin, 1999, p. 28]. Thus, senior regional SACTU officials became senior regional military commanders. For example, Moses Mabhida, a leading SACTU unionist, would become an MK political commissar [Barrell, 1990, p. 9, 19]9. It has in fact been claimed by one authority that "the SACTU leadership at all levels [initially] formed the majority of the Umkhonto we Sizwe cadres..." [Lambert, p. 462 - 463; see also: Baskin, 1991, p. 15].

Even from the start, SACTU had been heavily involved with ANC political activity, including, for example, the anti pass law campaign of 1959 - 1960, which had culminated in the Sharpeville crisis and the banning of the ANC. Appropriately, the ANC would subsequently, at its 1969 Morogoro conference, link the failure of mass strikes (presumably under SACTU), to the ensuing resort to armed struggle in 1961 [Strategy and tactics., 1971, p. 181, 185].

Soon after the 1960 banning, however, ANC leaders, like their close allies in the recently formed South African Communist Party (SACP), were either arrested and sentenced to prison terms, or else forced to flee overseas. The ANC movement was thus rendered inactive within South Africa for the next two decades. Although SACTU was never banned, it was helpless against the strong apartheid state. Moreover, it was crippled by the banning of its allies, upon whose leaders it had previously depended.

From 1973, SACTU would become increasingly rivalled and ultimately eclipsed by the growth of so called "independent" unions. These unions grew more rapidly in membership than had SACTU, even in its heyday, since there were now far more workers than before, particularly

8 Not to be confused with the South African black mining union of the same name.

9 A similar example is given in: [Lambert, 1988, p. 448].

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in heavy industry (mining, chemicals and metal) due to the rapid economic growth of the 1960s. Industrial workers tended to join the new unions rather than the politically more controversial SACTU [Lambert, 1988, p. 122 - 123, 246].

The unions called themselves "independent" not only because they were independent of government control but also, and at least as importantly, because, unlike SACTU, they were independent of the ANC. The relative ease with which the ANC had been crushed had in fact made most labour circles reluctant to have close relations with it, and SACTU was therefore avoided as well. Furthermore, the rapid growth in numbers of the new unions made them more self assertive. Rejecting the ANC's emphasis on a multiclass National Liberation movement, many preferred to espouse aims akin to the leftist Keynesian social democracy which at that time was still espoused by British Labour. Still others were communist.

The new unions' independence of the ANC attracted support also from the government, which, in 1979, officially recognised them through the Wiehahn trade union reforms. As a result the unions were able simultaneously to create the Federation of South African Trade Unions (FOSATU). Wiehahn, in turn, was part of a general pattern of reforms meant to liberalise apartheid so as to reduce its costs. A series of reforms was passed between 1975 and 1982, which had the important effect of loosening homeland police and administrative controls over the black townships. This second set of measures, however, proved lethal for the state for it in turn permitted the infiltration of ANC influence into the townships. By 1983, the United Democratic Front (UDF) had been formed, itself closely linked to the ANC. The UDF was at first not banned and thus could help revive ANC influence.

But the townships had changed politically since the 1950s. At that time, a small, beleaguered black middle class was basically under siege, facing the steady tightening of apartheid. Faced by a growing threat to its existence, it had no other recourse but to draw closer to the black labour unions and together support the revolutionary Freedom Charter. During the second half of the 1970s and early 1980s, on the other hand, apartheid was on the retreat, and the urban black middle class expanded in its wake. They had become far more aggressive and now saw their erstwhile close allies, the unions, also as rivals. The feeling was reciprocated by the unions, themselves.

The UDF was naturally closer to the middle classes than to the unions. Its base after all was the urban townships, the natural centres of any political resistance, and where these same middle classes were concentrated. Both the UDF and the unions would compete for the allegiance of the poor, many of whom were not unionized. This would not prevent the formation in late 1985 of the COSATU. As its name implied, in contrast to its predecessor, FOSATU, COSATU paid homage to the original Congress tradition of the 1950s, implying an alliance with the ANC. However, in contrast to the TUC's relationship with the British Labour Party, the alliance was a relatively loose one. It would not prevent the rivalry [see, for example: Mayekiso, 1996, passim; Eidelberg, 1993, passim]10 between the two organisations from continuing, first in opposition, especially during the 1980s, and subsequently after the ANC's coming to power in 1994.

In the short run, particularly during three years following the government-imposed state of emergency of July, 1985, the unions were at a great advantage, since the state focussed its repression particularly on the UDF, hampering its activity and eventually even banning it. Thus the townships fell increasingly under COSATU rather than ANC influence [Mayekiso, 1996, passim; Eidelberg, 1993, p. 278,281 - 282]. In terms of international recognition, the Unions also had an impressive profile since, along with the UDF, they could take much credit for the mass unrest which, from 1985, would encourage the imposing of international sanctions.

On the other hand, from 1988 - 1990, with the re-emergence of the ANC into legality, it was the ANC, and not COSATU, which could lay claim to becoming the future government. Moreover, it was the ANC, with its support from the township middle classes, which could espouse capitalism and thus win support from the all-powerful international capitalist community.

10 Mzwanele Mayekiso was a brother of Moses Mayekiso, General Secretary of the Metal and Allied Workers' Union (MAWU).

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COSATU, for its part, would remain committed to left wing, Keynesian social democracy (and in a number of cases, even communism) into the twenty first century [Business Day, 19.05.2005, p. 4], since its main supporters were, by definition, from the working classes. Moreover, since it was a separate and autonomous organisation, it could not easily be pressured to follow the new ANC capitalist outlook. In no way would COSATU make its peace with capitalism and support revisionist social democracy of the type pursued by the UK's successive Blair labour governments and by the ANC. Like British Labour, the ANC represented diverse groups in society even if by now increasingly under middle class hegemony. This put the unions at a disadvantage with the ANC, and not only internally. It also would isolate COSATU from much of the international capitalist world, in contrast to the previous situation during the mid 1980s when the unions and international capital had become temporary allies against apartheid.


The sharp contrast in the degree and direction of unemployment is a good example of how similar monetarist (neoliberal) policies followed by South Africa since at least 1994 and the U.K. since 1979, have led to diametrically different results. In South Africa, monetarist policies have probably aggravated long term trends in unemployment. The rate of general unemployment has been currently estimated at between 28% and 40%. This discrepancy depends on whether only those actively seeking work and not succeeding are included, or whether also those who have stopped looking for work are also added [Business Day, 24.07.2004, p. 1; 6.09.2004, p. 11; Star Business Report, 14.04.2004, p. 3; see also: Terreblanche, 2002, p. 372 - 373, 390, for slightly different figures]. In the U.K., in contrast, monetarist policies have had no negative impact on employment, at least not in the long run. By 1999, unemployment was only 4.5% [Reitan, 2003, p. 204].

Not only is South African unemployment one of the highest in the world, but the country has witnessed a steady increase in joblessness since around 1970. Sampie Terreblanche estimates a doubling of the general unemployment rate from 20% to 36% between 1970 and 1995 alone, and to a further 46% in 2001, if one includes also people involved in casual informal employment and subsistence agriculture. For the majority African population, itself, the figures rose from 24% to 46% between 1970 and 1995, and then to 55% in 2001 [Terreblanche, 2002, p. 31, 372 - 373, 390].

In Britain, on the other hand, the trend has been quite different. During the Thatcher governments there was a definite rise in unemployment, from 4.9% to 11.8% from 1979 to 1986. However, by 1990, the rate had dropped again even more precipitously to 5.8%. By 1998, it had dropped slightly further to 5%, and to 4.5% the following year [Reitan, 2003, p. 78, 188, 204].

The reasons for unemployment in South Africa are numerous, and some are disputed. However, there seems to be general agreement that a key reason is the lack of skills among the general population, in particular within a relatively very large percentage of the African majority. An obvious problem has been the continued shift, over the past twenty years, in the share of the Gross National Product in favour of financial and business services, at the expense of the traditional mining and manufacturing industries. The new jobs demanded a higher degree of skills in numeracy and literacy than the level which traditional unskilled and semi-skilled jobs in manufacturing and mining had required [Nattrass, 2002, p. 3].

It has been estimated that from 1985 to 1994, the skills composition of the total potential African labour force remained essentially unchanged at 95% unskilled or semi-skilled [Terreblanche, 2002, p. 389 - 390]. This had been accompanied by a massive rise in African enrolment at matriculation and university level. However, the students usually chose to work for humanities degrees, where the requirements were largely for general knowledge purpose. Relatively few chose more specifically market-oriented degrees in business and finance, not to mention the hard sciences, including information technology. The result was that there was a sharp increase of graduates who had obtained degrees but could not find jobs [Nattrass, 2001, p. 8; Business Day, 2.03.2005, p. 2; Mail and Guardian, 16 - 22.07.2004, p. 17].

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In contrast, labour retraining in the U.K. has led to a steady increase in productivity per worker, particularly since 1979, under the Thatcher, Major and Blair governments. This relatively successful retraining, in fact, must, itself, have helped keep unemployment under control. At the same time, productivity lagged compared to other highly advanced industrial economies such as the United States, France and Germany [Owen, 2001, p. 217 - 219].

The present lack of skills and consequent mass unemployment among Africans, is often attributed to the apartheid legacy [see, for example: Business Day, 6.09.2004, p. 11] and its dependence on cheap and relatively unskilled labour, for example, in the mining industry. But the overwhelming majority of Africans were unskilled before apartheid as well, except for a tiny middle class minority of professionals, educated in mission schools. Even here, as Jonathan Hyslop has argued, "most mission schools were poor primary schools with high drop-out rates" [Hyslop, 1993, p. 398]. In any case, they were not extensive enough to provide mass education. It was this void which "Bantu education" filled during the 1950s and 1960s, so as to train unskilled students to become semi-skilled labourers, possessing at least rudimentary skills in numeracy and literacy [Hyslop, 1993, p. 394, 398, 401 - 402].

It was only from the early 1970s that demand for skilled African workers became really serious, in view of the increased need of more and more sophisticated industrial machinery. Ironically, this was also when apartheid began to break down since a skilled African working class (like a skilled middle class), if encouraged to grow, was increasingly incompatible with the leveling effects of apartheid on black, urban communities.

It was no coincidence that the 1970s saw also the beginning of serious student unrest against both Bantu education and the apartheid economic and political system. After all, both were now beginning to be discredited by new employment demands to which an apartheid educational and political system could no longer adapt. And it was largely from then on, with the decline of apartheid, that the same demands of technology for more skilled workers began to cause growing mass unemployment among the majority of the unskilled and semi-skilled [Terreblanche, 2002, p. 372 - 373, 377 - 378, 390]. Small wonder then that mass unemployment should be seen not only as a chronic problem but also one increasingly identified with post apartheid South Africa.


Like South Africa, Britain also had to make a difficult transition during the past thirty years, from a relatively insulated, inward-looking, Keynesian economy to a more outward-looking, neoliberal, monetarist economy, from the end of the 1970s. Its adaptation to the new globalist international system has been, however, more complete and less traumatic than South Africa's transition from apartheid to ANC rule.

Although the government of Thabo Mbeki, is, if anything, increasingly committed to the international capitalist world, there are at least two salient characteristics which necessarily and fundamentally qualify its policies. These are, firstly, a ruling party so strong as to make South Africa, to all intents, a virtual one-party state; and secondly, widespread and permanent unemployment by some 40% of the population, a phenomenon which has been growing for the past twenty five years.

Because of its overwhelming support among the black (especially African) majority in South Africa, the ANC has been able to rule continuously, and without any serious challenge, ever since first coming to power in 1994. In fact its support has climbed from 63% of the electorate in 1994 to 66% in 1999 to 70% in 2004 [Southall, Daniel, 2005, p. 38]. True, British Labour, itself has been continually in power since 1997 - only three years less than the ANC. However, Labour functions within a polity which has always encouraged, at least in the long run, an alternating two party system. In contrast, for the past half century, a real political balance of power between major parties has not been tolerated in South Africa. Under apartheid, a true multiparty system became increasingly impossible, if only because of the constant threat of radical social upheaval from the black majority. Under the ANC, a true multiparty system is also not possible. Because of the overwhelming mass poverty, unemployment and lack of skills, in contrast to the much

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more stable and prosperous British society, the threat of social upheaval, not to mention possibly even civil war, persists and must be prevented by a strong executive.

While both the ANC and British Labour seek a considerable measure of redistribution of wealth in favour of the poor, what distinguishes South Africa is that much of this redistribution is perforce to the large and growing population of the unemployed. In Britain, on the other hand, redistribution goes largely to the working population [Glennerster, 2001, p. 395; Taylor, 2001, p. 254,259], since unemployment is relatively low.

It has, of course, been politically expedient for the South African government to follow its British counterpart in officially viewing unemployment as a challenge which must be surmounted. However, even this position has been changing. The ANC minister of finance, Trevor Manuel, in a late 2004 interview with the Sunday Times, admitted that in fact mass unemployment was not going to disappear and that the country must learn to live with it. He emphasized that "macroeconomic policy and stability do not create employment. All that they do is create an environment where you've got price stability, and in which people can take long-term decisions" [Sunday Times. Business Times, 12.12.04, p. 1]. Nor, according to him, would a higher rate of economic growth necessarily help in this respect. In fact, economic globalization and technology, were themselves factors in encouraging unemployment [Sunday Times. Business Times, 12.12.04, p. 1].

Therefore, Manuel argued, both government and trade unions should encourage and assist the growth of an informal economy of the self-employed. Manuel, at the same time, realized that the unions themselves would oppose such a plan since it entailed encouraging competition from the non unionized and a drop in union membership numbers [Sunday Times. Business Times, 12.. 12.04, p. 1]. Nor, of course, it may be added, would this growing informal economy necessarily exclude large-scale poverty. Many of these "self-employed" would be in fact peddlers and casually employed people offering themselves for odd jobs, while living barely above subsistence [see also on this, the editorial in Sunday Times. Business Times, 12.12.04, p. 7]. Others would be prostitutes, and still others, criminals.

As expected, this approach has drawn criticism from COSATU. Neva Makgetla, a well known COSATU economist points out that, since 1994, the government had unfortunately emphasized welfare rather than fundamental "economic transformation", which would have entailed large scale job creation aimed at significantly reducing mass unemployment [Business Day, 11.02.05, p. 11]. This argument has also featured prominently in major speeches of the South African Communist Party (SACP) [Nzimande, 2005; Cronin, 2005].

In this debate, however, it is the government which has the advantage if only because such large scale job creation is unlikely to be feasible for the foreseeable future. This makes it hard for COSATU, or its ally, the SACP, to make much headway in enlisting mass support from the unemployed. Instead, the government's own emphasis on welfare appears more realistic, and permits it also to continue to rely on the unemployed masses during elections. Thus, paradoxically, the ANC is able to outflank COSATU, not only from above (by enjoying support from big business, both black and white) but from below as well.

The monetarist revolution of the past twenty five years which has been so popular among policy makers in both countries under discussion, has thus not necessarily had the same implications in South Africa as in Britain. It is often argued that in both countries, monetarism has served the interests of the economy, and especially financial interests, at the expense of organized labour [Marais, 2001, p. 216 - 217; Makgetla, 2004, p. 6]. This, while true, is in the South African case nonetheless an oversimplification. For here, monetarism, has not simply hurt labour but, by effectively curbing inflation, has also benefited the unemployed (the group most vulnerable to price increases) [see above, section 2] at labour's expense. By trying to stabilize prices through such policies as a balanced budget and a strong, steady rend, the government shows its preference for thereby stabilizing wages, as well as acting as a partial break on increased demand for labour. None of these disadvantages for organized labour, however, would affect the vast and growing numbers of those who are already unemployed and thus receive no wages in any case.

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