Cosatu WC Provincial Secretary, Tony Enrenreich speaks at Harold Wolpe debate 29- 08 - 08

Speech at the Harold Wolpe debate by Tony Ehrenreich, COSATU Western Cape Provincial Secretary, 28 August 2008

10 YEARS OF LIBERAL DEMOCRACY HAS ENTRENCHED POVERTY AND ELITES – IS IT BY ACCIDENT OR BY DESIGN?

Thank you very much for the invitation to come and speak at this important event, to come and share with you what has been done and what is possible and what we can do together. What are within the realms of the possible if we found common purpose, in a way that took the desire and ambitions of the people of our great Province to its true potential.

If we find a way to speak to the dreams and ambitions of our people, to the hopes that they have for their children, to the sacred promise of liberation as captured by the Freedom Charter. As well as the immortality of Mandela, the greatest son of the African soil, who is also the benchmark of what is possible in human conduct driven by love and compassion. This kind of leadership that is borne out of a desire to serve our people, not for the personal gain or the prestige of high office, but because it is a labour of love.

How do we take what resides in the hearts of individuals as private virtues, the essential goodness of people, and turn it into public values, that reflect the collective goodness of the whole society. The sense of community that we had after 1994 was directly related to the hope of the nation in what was possible under great leadership. The sense that public values will be turned into public policy/ government policy, that addresses the social injury of our society, and starts to build this better life for all in a systematic way. There is a profound leadership deficit in the world , of leaders who will inspire great things, not just follow orthodoxy, hence our own fascination and excitement with Obama and the possibilities it presents.

Realizing a dream can only be born out of living the dream, the noble dream of people who are equal and free, whose every endeavour is to take forward the dream of one nation united toward the attainment of a society that gives expression to the better nature of human beings. This needs leadership who can endure in the service of the people, but it also needs a society that honestly rebukes leadership who dismisses the ideal by saying that, they did not struggle to be poor like com Smuts has. We struggle to be neither poor nor rich, we struggle for justice and if that is attained we will all be better off because of it. Part of the problem in our country is that people are taking the short route, to greed and wealth that disregards the longer route that is sustainable and inclusive. It forgets that part of the reason some people are so desperately poor is because others are so obscenely wealthy. And the only way in which to build a society that has greater levels of social cohesion is build a society that is equal and fair and constantly works to greater levels of equality.

We should take a moment when ever we come together to acknowledge our achievements, because we have much to be proud of. For a woman who walked for miles for water and fire wood who can today turn on a stove, that change is truly revolutionary. For the rights that woman have today in the law and in the society, it’s gone a long way to break down patriarchy and discrimination. The constitution and rights for workers and other sectors of the society has certainly gone a long way towards undoing some of apartheids evils. But all the excitement generated by the possibilities presented by these changes were undone by the government subsequent policy choices, which cut the meager amount of water she used through co modification of public services, as well as the policies that outsourced and lost jobs, swopping decent jobs for low paid insecure employment.

Whilst the ANC reaffirms the commitment to Macro economic stability, it did not reaffirm its support for GEAR which has brought about the position that we find ourselves in today. The stability referred to must be questioned against rapidly fluctuating currency, the rising levels of inequality and unemployment, and the disintegration of the social fabric followed by growing protest appealing for a New Deal for the poor. The International Growth Advisory Council has been roundly criticised for being out of touch with what the most pressing issues in South Africa are, and there views cannot in any way be considered as justification for the continuation of the GEAR path. The integration into the Global economy and there institutions like the WB IMF WTO poses challenges but it should not emasculate the nation state in its ability to respond to the needs of its citizens as its primary focus. China and many other countries dot follow these structural adjustment rules that are imposed on developing countries – EU and USA subsidies on agri and beef.

The essential focus of my presentation today is on the effects of 12 Years of economic policy on the health and welfare of the nation, but it can’t happen outside of the South African context and the everyday life of the majority of South Africans 60% of the population. The unfortunate reality is that the majority of South Africans live on less that R1500 00 a month and are really living in desperate levels of poverty. Social cohesion is impossible in this environment.

There have been many debates on Macro Economics and its been followed with great interest by all and we take from it the fact that we cant remain trapped in orthodox thinking if we are to find solutions to the myriad of problems that we face, as well as realise the endless possibilities of our country. The individual contributions present an important part of the debate that needs to be held in the aftermath of Polokwane, as we review our policy mix to ensure that it speaks to our key obligations of job creation and undoing poverty. But it is jobs and poverty that should be the test of our policies as stated in the Presidents State of the Nation address, not whether it is in line with some Chinese proverb or Harvard economist, as our finance minister would have us believe.

The most urgent obligation in South Africa is how do we ensure the transformation of our society for speeded up service delivery, that responds to the 3 essential interrelated levels of the society, political social and economic.

• The first being political transformation in which respect we have done well, as we now have a constitutional democracy that is based on the rule of law, borne out of the establishment of a system that affords everyone the vote and outlaws discrimination on the basis of race.
• The second area is the need to radically advance social transformation in which respect of which not much has been achieved, or its achievements have been less than ideal.

We have made our people great promises but the delivery has not followed because there has been a lack of funds to fast track delivery. This is in part because of the cuts in public expenditure promoted by the GEAR policy and push for commercialisation and privatisation, as well as the fact that we employed high salaried technocrats who were more intent on earning their bonuses based on cuts in expenditure than on defining clear delivery plans. So today we see that the public transport system has become overcrowded and dangerous, with trains and busses and taxis being sub standard. Policing have declined significantly as, even police stations are guarded by ADT security firms. The public health care budget and service has been systematically cut whilst, the private health services have expanded due to more people having tax cuts and now being able to afford private health care or being forced into private health care due to the declining standards of the public health system. The private health hospitals are taking the nurses out of the public sector because they pay more, thus undermining the public service delivery even further, yet the government refuses to pay nurses and public service workers what they are due.

The other focus is in the area of education, which probably represents the greatest challenge and failure of the new administration, which not only cut the number of teachers but also the relative expenditure. So today we see a lack of teachers in poor schools, hopelessly overcrowded class rooms and non of the facilities that exist in the schools in the shadows of table mountain, where the politicians have their kids. These inequalities that exist in respect of resources in the different schools translate into inequality of opportunity, which makes it even more difficult for poor kids to get through the school system. Many politicians from Helen to Trevor say that teachers must just teach then everything will be all right in the schools, raising the question if they know how difficult it is to teach in a class of 50 or more kids, who are starving. Their kids are at schools that cost R35 000 00 per annum and have all the trappings of a modern education system, as well as class sizes of 25. What is the message that some kids are better than others, or more equal than others? The provision of social public services is the most obvious way in which the society can demonstrate a sense of solidarity by pooling there resources to fund a common interest like good education to all kids. These policies of government have systematically undermined the notion of a greater good or social good and subordinated it to individual interest.

v The third area of transformation is economic transformation and it is in this area that we have not done well at all. It is impossible to bring about fundamental transformation of our society unless all three transformation imperatives are advanced simultaneously, otherwise the apartheid legacy of inequality and unemployment will stay with us, along with distorted apartheid ownership patterns. So we can promise our people the world when we know that we do not have the money to deliver on those promises because we have not transformed the economic relations in the society to advanced the notion of the common good.

So apartheid’s inequalities and elites continue, but they become more democratic as they now include the BEE POLITICAL ELITE. This is a pretty inevitable consequence of the policy choices, so I have to conclude it’s by design, even if it was implemented by stealth. This is not unlike what had happened in other countries where the economic elites who grew under conditions of exploitation, realise that they risk loosing it all in violent revolution and so force the oppressive regime to negotiate democracy that guarantees that economic power remains in place. The result is that the oppressed masses get nothing more than the vote, but no fundamental change, maybe a trickle down.

If there is to be meaningful socio economic transformation in the society, then money must be freed up to pay for that transformation. This however means that the negotiated settlement will have to be reviewed, as it essentially guarantees control of the economy on the old terms, to those who stole it under apartheid. The only part of the deal that promoted a distorted economic transformation, is the BEE provisions that compelled companies to give up 25% of there companies to the politically connected black elite. In return the companies got tax cuts of nearly R100 Billion a year, which effectively meant that companies only gave up 17% of the bottom line profits in the company to buy legitimacy. This money was taken from the public pool of money to fund the enrichment of a few and could have addressed many of the social injuries in our society. This money could have and should have been used to promote and secure public service and build a sense of solidarity to the future and change people can believe in.

This is in part why we see companies guilty of the same kind of corrupt apartheid practices of fleecing South Africans consumers as they were under apartheid. The collusion by companies around the prices of milk, bread and chicken that contributes directly to the high food prices and starvation in our communities. The price fixing around bank charges, cell phone rates and steel prices that led to higher prices and bigger profits than elsewhere in the world for SA companies. The regulation in the finance sector that allows for speculation in basic food stuff that contributes to the high prices, the Import Parity Prices that are charged by Sasol that sees them charging the same price for petrol produced from oil, even though there cost are 50% less because they produce it from coal. The building industry sees workers working for a pittance and building houses in excess of R10 million, while the estate agent gets a few hundred thousand just for putting up a board. The farm workers who have been pushed off the farms, a million since 1994 and had there lives destroyed as they struggled to integrate into townships that were hostile violent places. These practices can’t be right or legitimate just because you have a BEE partner, or are trying to sell shares to ordinary citizens as a way to insulate the company from social pressure. If there was the political will the government could have regulated all these areas of the economy to prioritise employment creation, and the provision of basic services and food stuff ahead of super profits.

It would be in the national interest to tell Anglo America to add two stages of processing before exporting steel, so as to create jobs, and they would still have made profits, albeit a bit less than they do through just exporting tons of raw materials with no value add. A clear industrial strategy would have seen our industrial base expand and the creation of many more jobs in the economy that would have significantly reduced the levels of poverty in the society. The focus of an industrial development strategy was supposed to be advanced by the counter trade terms of the arms deal; again this only led to the enrichment of an elite through dubious means. So government will intervene and direct but just not in the interest of the majority.

The proposition from government that we have to stick with present policy and implement it more effectively if we want to have the delivery promised by the Government. This is equal to saying that the even though the patient is dead, the operation is a success, because all the procedures were followed. If we had implemented trade liberalisation more effectively by cutting back even more on the taxes on imports, there would not have been any manufacturing sector left in South Africa. WE HAVE SEEN THE DEVASTATION OF THE CLOTHING INDUSTRY, THE PRINTING, AND THE FOOD PROCESSING INDUSTRY. And the entry level jobs that we say we are committed to creating in the economy, would have been completely undermined. The only possible benefit from reduced tariffs would have been cheaper imports of cars and commodities to that sector of the society who are firmly part of the middle class and who already benefited from the tax cuts. How are we going to promote investment into sectors of the economy that create jobs when they are all closing down as a result of ideologically driven trade liberalisation, like The TV industry.

The society is loosing hope in the possibilities of a better future as 13 years later in spite of the achievements of political transformation, the levels of unemployment are close onto 40% and the levels of inequality are the highest in the world. The political champions of the past are assimilated into the white elites, with there kids in the R40 000 a year schools, and their families attending the best private hospitals, whilst they drive around in the luxury of there German sedans oblivious to the public transport crisis. The backdrop for this is poor communities where gangsters rule and drug abuse has become a plague, tearing apart the social fabric of our society and undoing the possibilities for greater cohesion, which is an essential part of making the rainbow nation a reality.

This is the daily lived reality of poor people in the townships of South Africa; more than 60% of the population, these people also have dreams, no less noble and no less valuable than the wealthiest man. They also hope for there kids to be save, to be successful, to be productive citizens, but it is a dream deferred as the plan now seems to be to create an elite and let the poor fund it, through there destitution.

There are a thousand terms to define economic doctrine many mentioned in the unfolding debate and many not, but it is all Chinese to the majority of our people and quite frankly comes across as just excuses for the non delivery. The starting point has to be that the economy must serve the needs of the people, it must progressively move us to a society that is more equal, more just and that inspires hope in our people for a future for all that is brighter than today. You be the judge of whether this has been the result of 13 years of economic policies in SA.

The democratic election was meant to be the start of the fundamental change of our society; the election set the scene for the real liberation of our people from the hardships that exist as their every day reality. The process of change was however taken no further than the elections, as many of those who were the champions of liberation became assimilated into the elite, being seduced by wealth and privilege, and holidays in Dubai. Those of us who believe justice and equality to be an indispensable requirement of building a new society must raise our voices in this new environment to ensure that this is the deciding factor. Democratic elections was meant to serve as the platform that was meant to launch this new society, embracing all - accommodating all, as we strive to realise the sacred promise of the Freedom Charter- a country that speaks to the ambitions of a nations longing to reinvent itself.

We have had our differences on policy but we need to find a way to ensure that we now take a new road that;

• Creates job opportunities for the unemployed;
• Healthcare for the sick and infirm;
• Education for the children;
• Social welfare for the marginalized;
• Public transport for the workers and communities;

But, we have to lead with intent that is translated into words and closes the deficit that exists in the society, the deficit of leaders and morals and good ideas.

We have a deficit when the CEO’s are earning more in 10 minutes than workers earn in 10 months

We have a deficit when one child has a more favorable opportunity than another, just by virtue of his birthright.

We have a deficit when families sleep on the streets, with no homes

How do we do this, we have to emerge with a plan that inspires our people to have hope in the possibilities of a future that speaks to there pain

This hope must bring a promise of change, but change they can believe in:

• Change that brings us together, because in the struggle for peace and justice we cannot walk alone or separated
• In the struggle for opportunity and equality we cannot walk alone or separated
• In the struggle to heal this nation and repair the pain we cannot walk alone or separated
• Unity is the great need of our time, we have done it before n the UDF we can do it again.

But to achieve this we must break down the divides between ourselves , between what are the hard and the soft issues , between those who have abundance and those who need , we have to define our own language, our own plan, our own morality that speaks to our people and breaks down the walls to reveal the truth.

A BETTER WAY IS NOT ONLY POSSIBLE IT IS INFINITELY MORE DESIRABLE

Thank you for your interest