The darkness before the New Dawn

William Saunderson-Meyer says the truth is things are bad and are likely to get worse before they get better


For the jaded observer, there is some satisfaction in watching banal slogans come back to bite their creators on the bum. 

Whether it’s Donald Trump’s Make America Great Again, or Cyril Ramaphosa’s New Dawn, the reality of being able to control only a subset of cogs in the lumbering behemoth that is the global politico-economic order, means disillusion is inevitable. The post-1945 leitmotif of steady progress to a better life for all, sadly, is simply not true.

That things are bad and are likely to get worse before they get better, is not a message that voters want to hear and consequently no politician willingly articulates it. It is only when a country is on its knees, that the politicians will tell the unpleasant truth, and then only because there patently is no option.

Even as Greece trembled on the brink of economic and social collapse a few years ago, its government was blustering, threatening and cursing the fates – in this case, the European Union and those nasty Germans – until the very last second. Then they buckled under the weight of the inevitable. 

The populist Syriza party that under firebrand leader Alexis Tsipras had sworn never to surrender Greek sovereignty – the right to run a notoriously corrupt, over-staffed, over-paid and incompetent government bureaucracy dispensing unaffordable amounts of social largesse – upon winning the election promptly broke every campaign promise they had made. Harsh austerity measures were imposed, including cutting pensions and child benefits, cracking down on the untaxed “underground” economy, and curbing union power.

The parallels with South Africa are obvious, right down to radical populists promising, despite all historical evidence to the contrary, that a socialist Nirvana is ours for the choosing. All that remains at issue in SA today is exactly when we are going to hit the brick wall and whether, perversely, instead of adapting to reality, the electorate will instead double down its bet on red, handing us a Zimbabwean or Venezuelan outcome instead of a Greek one.

Certainly, Ramaphosa’s new dawn is, for now, obscured by storm clouds. The currency is sliding, after the buoyant euphoria that greeted the ousting of former president Jacob Zuma and the thieving cabal around him. As the statistics mount up, it is steadily becoming more evident what a parlous economic state we are in.

Take the difficulties of Eskom and South African Airways (SAA), both of which featured in the media this week.

Eskom has long been in a poor state, limping from crisis to crisis and along the way incurring some R350bn in government debt guarantees. It will take more than managerial expertise to solve the problem, since it ultimately demands the political courage necessary to make swingeing cuts to staffing levels.

Janine Myburgh, president of the Cape Chamber of Commerce, points out that World Bank comparisons show that Eskom is overstaffed by 66%, with an average salary of more than R700 000 a year. Productivity is terrible, with the equivalent utility in India producing about 40 times as much electricity per employee as Eskom does.

Then there’s SAA’s release of its 2016/17 accounts, a year late, to coincide with its executives turning up yet again before the parliamentary select committee on public accounts, to plead for another cash injection. This time it’s R5bn, which comes on top of R20bn in bailouts last year, and the likelihood of Treasury having to intervene again to help pay the R9bn that becomes due in 2019.

Scary as these numbers are, these statistics are not the worst of it. The worst is the attitude of SAA executives and government politicians – the disjunction between the arrant nonsense they spout publicly and the reality that they privately must surely be aware of.

Firstly, there is the “too big to fail” argument, much loved by financiers and businessmen seeking taxpayer bailouts, and the politicians that enable this. Deputy Finance Minister Mondli Gungubele says it would cost as much as R60 billion to shut down SAA, three times as much as what is needed to stagger through to 2021, by when the airline will apparently be soaring.

That’s nonsense. Sell SAA at a bargain basement price to any one who will take it off our hands. Free of government interference and the political imperative to featherbed unproductive workers, the new owners will do the obvious: slash routes, slash staff, slash overheads and put in oversight mechanisms to reduce SAA’s staggering levels of theft and corruption. 

Secondly, there is the blinding vanity of having a national carrier. SAA boasts in its annual report of being “the most revered brand in Africa”. 

This is the same “revered brand” of which its own CEO, Vuyani Jarana, admitted to MPs this week: “SAA as a brand does not sell to top skills... No-one wants to leave a good job and come to SAA.” 

If SA is ever to see Ramaphosa’s “new dawn”, a key issue is state employment and over-manning. The confrontational militancy of Wednesday’s one-day national strike by the SA Federation of Trade Unions , which are threatened to continue “until the sellouts of the revolution fall”, indicate how difficult it is going to be.

Nevertheless, Ramaphosa’s administration is going to have to, very soon, by choice have to seize the nettle. Otherwise, a Greek-style collapse will force them to.

Follow WSM on Twitter @TheJaundicedEye