The many pitfalls of the DA’s growth strategy
THE Democratic Alliance’s (DA’s) Plan for Growth and Jobs is aimed at "building an open and inclusive economy that delivers opportunities for all". In my previous column I questioned the DA’s misuse of its energies on a document that may never see life as government policy. It should, nonetheless, be examined on its merits rather than being dismissed outright.
The document avoids stating upfront what its ideological orientation is, choosing instead to frame its arguments as evidence-based and pragmatic. This centrist position is aimed at winning broad-based appeal with sights set on increasing electoral gains. While the DA is not entirely against the state playing some role in the economy, it rejects what it sees as creeping state capitalism. It believes the role of the state is to provide an environment conducive to growth, including provision of critical infrastructure; correcting market failures; ensuring fairness by promoting broad-based ownership and participation; and promoting South African businesses globally. This is fine, but it lacks specifics.
It elevates Brazil and Mauritius as models to be emulated. It is not clear why it chose these two countries as benchmarks. Mauritius is an island economy and, apart from tourism and the financial sector, has little SA can learn from. Brazil lags behind SA in the World Economic Forum’s global competitiveness ranking.
Similarly, on measures of competitiveness such as institutions, infrastructure, macro-economic environment, and labour market efficiency, SA ranks far better than Brazil. SA is at a favourable 34, whereas the former is among the laggards at 127. Brazil also shares a similar underbelly as SA with respect to corruption and income inequalities, although Brazil shows more political will than SA in overcoming both. The arbitrary benchmarks of the DA undermine the seriousness and credibility of its policy thinking.
The DA’s growth strategy seems ambivalent about the role of state-owned enterprises. In one part it suggests the introduction of private sector management expertise in "former" state-owned enterprises, lamenting their anticompetitive behaviour, while elsewhere it recommends their partial retention based on commercial viability and strategic importance following an audit. So no significant policy ground broken there.
Another proposal lacking in imagination is the assertion that the best way to manage our natural resources is by living within our means. Only the DA faithful can decipher what this means. One would expect the DA to seize the moment and offer bolder positions, especially given the raging debate about state involvement in natural resources in SA.
Crucially, one of the objectives the DA says it wants to achieve with this plan is to break down the wall between the socially excluded — the poor and jobless — and those who are well-to-do. As I have said before, it will take more than a growth strategy to do this effectively.
Building socioeconomic cohesion will also require evolving a new social contract resulting from a focused social dialogue about the kind of economic values we want to embrace. These must be promoted through policy and institutions designed to enhance socioeconomic inclusion. Accordingly, there are questions the DA must answer: in what ways does it showcase social inclusivity in the province it runs? And what socioeconomic values are emblematic of DA’s governance in the Western Cape, and will it seek to imbue national government with them?
The juxtaposition of social marginalisation in townships such as Khayelitsha and Lwandle on the one hand, and affluence in suburbs such as Bishopscourt and the town of Somerset West on the other, remains morally shocking. The DA’s technocratic finesse belies its woeful lack of leadership to facilitate social integration.
While it may not be the DA’s fault that we have this ugly picture of economic inequality, as the governing party in the Western Cape it needs to respond to perceptions that it has no positive accounting for social cohesion in its governance record.
One of the most puzzling aspects of the DA’s discourse is the continued comparison of itself with a party that is all but a carcass — the African National Congress (ANC). This is a sign of a lack of confidence. There are very few people who would dispute that on public administration, the DA is shoulders above the ANC, which has failed to showcase one best practice out of the eight provinces and seven metropolitan councils it controls.
Why spend so much energy obsessing with such a failed party? The DA will need to offer a more coherent and convincing answer about concerns over social exclusion in the Western Cape in the same manner that the ANC has to stop hiding behind the veil of the apartheid legacy and take responsibility for the country’s persisting socioeconomic ills.
•Qobo teaches politics at the University of Pretoria and is a member of the Midrand Group.