24/04/2017 11:38 SAST | Updated 25/04/2017 08:26 SAST

Why Government Couldn't Afford To Lose Jonas

The axed deputy finance minister says the country is being "looted" in front of our eyes, and there is no coherent strategy for radical economic transformation.


Radical economic transformation means transformation for millions, not for a few families, former deputy finance minister Mcebisi Jonas said at the Chris Hani Memorial in Uitenhage on Sunday.

In another scathing attack on the ANC's leadership and the "new politics of profound mistrust", Jonas decried "radical economic looting", saying the country is "being stolen in front of our eyes".

Prior to the president's mass midnight-reshuffle which saw Jonas and former finance minister Pravin Gordhan among others kicked to the curb, Jonas had repeatedly warned of the dangers of slogans without substance.

In March, he said the transformation conversation had been threatened by an "asset-grabbing mindset", according to Business Day. He also denounced "contradictory and sometimes foolish public statements [around radical economic transformation]" and, on Sunday, those who "repudiate the Constitution" in the name of radical change.

Now unashamedly dismissive of so-called RET (Radical Economic Transformation) as, largely, a smokescreen for 'state capture', Jonas is one of few who have attempted to give carefully-constructed policy meaning to an otherwise mystifying, albeit seductive, phrase.

Nine months before the first rupture in the National Treasury in December 2015, popularly dubbed Nene-gate, Jonas published a critical review of the competing 'faces' of RET in the SACP's African Communist journal. He was one of the first leading politicians to consider how RET may itself be radically transformed from a mobilising slogan into a workable economic policy framework grounded in rigorous research and debate.

He distinguished between five competing paths for RET, ranging from the ANC's reformist (albeit vague) approach to structural transformation to more radical or 'revolutionary' variants advocated by the EFF, SACP and -- since his article -- the Black First Land First (BLF) movement. His article was an attempt to look for common ground between sometimes incompatible positions and propose solutions the alliance could use to forward the debate.

Some of Jonas' most compelling assessments for devising a strategy for RET include:

  • First and foremost, developing a shared understanding of why South Africa has not been able to achieve a higher and more inclusive growth path must be high on the agenda.
  • The need to ask difficult questions about the capacity of the state to implement structural change and, more broadly, defining more carefully the limits of role of the state in achieving 'rapid growth' in pursuit of mass job creation.
  • Part of this must be to encourage more robust and evidence-based arguments on the state's role in industrialisation and, in particular, the role of creativity and innovation in supporting manufacturing growth.
  • Whether RET will require a new 'social compact' that accommodates the interests of the small business, agriculture, the unemployed and poor and, pertinently, whether the ANC is equipped to lead this change.
  • Ensuring important redistributive mechanisms such as BBBEE and land reform grow productive capacity in the economy (increases in output, employment and exports, rather than only securing ownership transfer.
  • Most notably, Jonas called for a break from 'old paradigms' or 'dogma'. He argues for a mix of pragmatism and innovation while remaining true "to our [the ANC's] ideological commitment to socio-economic justice".

Jonas' assessment, and certainly conclusions, are not a foregone conclusion but an apparent invitation to political leaders to drive the shift from sloganeering to clear, workable policy choices and instruments. These, his writing suggests, must be radical in the sense that the overly-financialised, commodity-dependent and deeply inequitable features of the economy must be eradicated with urgency. The replacement, in his mind, is a capable, innovative state with a firm stake in development.

The necessity of a "special kind of leadership" to drive RET, which he stresses in the document, was perhaps more prophetic than he realised at the time. The question, he said, "must revolve around the extent to which we as the ruling party have the appetite and maturity to move beyond narrow sectarian and often factionalist interests to more honestly and robustly confront the challenges we face".

The "special kind of leadership", he writes, is one that will be able to "make hard choices, placate the growing impatience among our people, and not succumb to populist solutions that may win the day but take us nowhere on the broader journey to restructure economy and society".

As the ANC, in particular Finance Minister Malusi Gigaba, scrambles to define Radical Economic Transformation as a policy framework, the party may soon realise a coherent policy framework for transformation may have developed sooner (or at all) with Jonas in-house.

If there was any doubt within the ANC that Jonas, in his capacity as deputy minister, was committed to radical change in pursuit of socio-economic justice, his writing demonstrated that he was willing to do the hard work of contributing to policy change, albeit carefully. It further confirmed his commitment to the ANC through his assertion that the party would be the only organisation capable of achieving this radical change, a view shared also by his then-superior Gordhan.

Instead, the ANC must now battle -- in policy and politics -- against RET as 'state capture', 'gibberish' or 'looting' before the opportunity to substantively redesign the South African economy for all citizens' benefit is lost.