Nelson Mandela and former second Deputy President F.W. de Klerk hold their hands high as they address a huge crowd of people in front of the Union Building after the first presidential inauguration on May 10, 1994. Picture: REUTERS
Nelson Mandela and former second Deputy President F.W. de Klerk hold their hands high as they address a huge crowd of people in front of the Union Building after the first presidential inauguration on May 10, 1994. Picture: REUTERS

THERE are suggestions that the ANC lost the plot after the ascension of Jacob Zuma as the party’s president in 2007. There may be important elements of truth in this. However, there are compelling reasons that situate the morality challenges faced by the ANC — and by extension the country — in the 1994 political transition.

Recent developments do indeed place Zuma at the centre of the web of corruption at present. And it is clear that some within the ANC hold him personally responsible for the drastic decay in the party’s morality.

For many, the current battle between Zuma and Finance Minister Pravin Gordhan is viewed as the culmination of one between those who view the ANC as a machinery for accumulation and those who hold true to its historical mission as a vehicle of liberation fighting for a more socially just society.

The harassment suffered by Gordhan at the hands of the Hawks, an elite police unit, is seen as an extension of the "state capture" agenda that led to the firing of Nhlanhla Nene in December 2015. This comes after a host of allegations that the country’s key state-owned enterprises, such as South African Airways and power utility Eskom, have been captured by the Zuma faction of the ANC elite.

READ THIS: SA’s economy will stay stuck unless political interests are realigned

This might look like a factional battle with good guys on one side and bad guys on the other. But I would argue that the challenge of economic transformation within a racially polarised capitalist economy provided opportunities for careerism, personal enrichment and corruption.

At the heart of the morality problems faced by the ANC are fundamental forms of relations it has carved with capital, as driven by two principal factors. Firstly, as a political party, the ANC has needed funding. Secondly, there is the factor of how the ANC has chosen to promote what it terms the national democratic revolution, most notably through black economic empowerment.

In the mid-1980s, South African capitalism had begun to lose faith in the capacity of the National Party government to stem the rising tide of revolution. Increasingly, therefore, business looked for accommodation with the ANC. For its part, the ANC leadership recognised the unreality of strategy premised on a revolutionary seizure of power. It presented itself as a partner with which large-scale capital could play.

While it was the political negotiation process that grabbed the attention, much was happening behind the scenes. Individuals at the top of the corporate ladder struck up relationships with the incoming ANC leadership.

Above all, this was exemplified through a focus on Nelson Mandela, who after his release from jail came to enjoy the company of the very rich. He forged strong relationships with both Harry Oppenheimer, chairperson of Anglo-American, and Clive Menell, vice-chairman of rival Anglovaal mining.

Just as the ANC was unable to overthrow the political, so it was unable to overturn the economic order. The collapse of the Soviet Union, one of the ANC’s principal supporters, fundamentally changed the international landscape. This played to the strengths of those leaders within the ANC who were less than enamoured with state socialism. Such factors, along with pressure from bodies such as the International Monetary Fund, underlay the shift away from the left.

At base, the ANC was a nationalist movement whose principal focus was on the capture of the state and the pursuit of democracy. Within this formula was embedded the commitment to the overthrow of "internal colonialism" (the domination of whites over the majority black population). It followed that capture of the state and internal decolonisation would require the rapid growth of the black middle class and indeed, the expansion of a class of black capitalists. This was true both in terms of social justice and the needs of the economy.

However, the problem facing an emergent black capitalist class was its lack of capital and capitalist expertise. One of the solutions was that, from the moment it moved into office, the ANC viewed its control over the civil service and parastatals as the instrument for extending its control "over the commanding heights of the economy". Parastatals accounted for about 15% of GDP.

READ THIS: State companies cannot help development if the state is a partisan player

This included the strategy of transferring state-owned enterprises on discounted terms to blacks via privatisation. In the event, this did not prove to be particularly successful simply because the amounts of capital required for the purchase of all but noncore assets were too large for aspirant black capitalists to raise.

Nonetheless, the national democratic revolution charged the ANC with using state power to deracialise the economy. This predisposed the ANC to regard the parastatals as "sites of transformation". The ANC’s control of the state machinery became a source of tenders for its cadres. This aspect has lent itself to corruption, patronage and the monetisation of relationships within the ANC.

The extent of corruption in tendering is difficult to estimate. The ANC is appropriately anticorruption in its official stance, and indeed has put in place important legislation and mechanisms to control malfeasance. Equally, however, it has proved reluctant to undertake enquiries that could prove embarrassing.

There have also been two other activities at work. First, certain corporations have distributed financial largesse to secure contracts and favour from the government. (Their success in so doing is hard to prove given the secrecy of party funding). Second, ANC politicians at all levels of government have sought to influence the tender process in their favour.

One of the key challenges is that the South African political economy continues to revolve around "an odd combination of new (political) power without money, and old money without power". Each needs the other to advance its interests. This is structurally disposed to favour corruption, as is indicated by the incestuous relationship that has developed between Chancellor House and parastatals. Chancellor House is listed as a charitable trust designed to facilitate economic transformation. However, it has become clear that its intent is to fund the ANC.

And the need for party funding is more likely to increase than diminish. Although the case for public disclosure of private funding of political parties is by no means so strong as its supporters proclaim, it remains difficult to exclude influence peddling from this particular terrain.

As the ANC acknowledges, it is a multiclass movement composed of capitalists, the middle class, workers and the poor. As such it is a host to class struggle within a society imbued with capitalist values and consumerist temptations. Despite the early efforts of union federation Cosatu and the SACP to shift policy to the left, many within their own ranks have fallen victim to the temptation of following a political path to personal enrichment. In such a situation, it is not surprising that it is the rich and the powerful who have benefited overwhelmingly from our democracy.

This article was adapted from a paper titled The ANC for Sale? Money, Morality & Business in SA, published in the Review of African Political Economy

This article was first published in The Conversation.

The Conversation