BILL FREUND REVIEWS ‘SHADOW STATE’.
Ivor Chipkin and Mark Swilling [and team] (2018) Shadow State: the politics of state capture. Johannesburg: Wits University Press
Pieter-Louis Myburgh (2019) Gangster State: unveiling Ace Magashule’s web of capture. Cape Town: Penguin Books
Bill Freund email@example.com
Especially when South Africans approach election time, the publishing industry has waiting for them a series of books on politics which may contain insights but are best classed as an extension of journalism. In 2019, state capture and corruption (or as Helen Zille likes to put it, ‘corruption, corruption, corruption’) added spice to the recipe for an election where the votes actually failed to shift significantly and turn-out went down. The purpose of this review is to call readers’ attention to a short, succinct and important book written by a team of nine, headed by Ivor Chipkin and Mark Swilling, which can easily be confused with the more ephemeral accounts such as the book focussed on the career of ex- Free State ANC premier Ace Magashule by Peter-Louis Myburgh, which received vastly more attention in recent months, not least because followers of Magashule, now the secretary-general of the party elected as part of the Zuma slate, literally tried to burn and trash copies.
Chipkin and Swilling’s team have produced a more disturbing and analytical work that encompasses the national scene. None of this is imaginable if you just like to follow the crude formula that so-called neo- liberalism explains everything. If, as would be true of most politicians perhaps, you confine your vision of South Africa to black people, it is fair comment that post-1994 democracy has offered...
a small black elite beholden to white corporate elites, a vulnerable and over-indebted black middle class and a large African majority condemned to unemployment and dependent on welfare handouts to survive. (101)
White businessmen are still on the beat but they invest little and have shifted resources abroad or into financialised outfits that remain very profitable. Given the history of giant mining companies and SOEs, much of the economy, sector after sector, is and remains dominated by a handful of giants. As Chipkin and Swilling point out, corporate leaders have only very limited faith in an African-run democratic state with some neo- liberal pretensions.
The ANC negotiated parliamentary democracy from, in part, a weak position. It had little support amongst the professional and business classes and its military strategy had accomplished very little. Thus it was common cause that a second struggle was needed to transform South Africa. For many this meant a transformation that touched on class, overall inequality and basic institutions connected to education and health, for instance; socialism or barbarism, if you like. However a large body of leaders, who have been enormously reinforced by a younger post-apartheid black generation, rather see the second struggle as one with ‘white monopoly capital’, are deeply resentful of the continued successes in big firms of white businessmen, and are eager to use the state to achieve economic ‘empowerment’ for their own benefit. The way was already paved by Thabo Mbeki who also believed strongly in the ‘empowerment challenge’ (34). It is difficult to say what interest, if any, they have in transforming the lives of the majority. Chipkin and Swilling want to see this politics in a broad sense
...as a political project at work to repurpose state institutions to suit a constellation of rent-seeking networks that have constructed and now span the symbiotic relationship between the constitutional and shadow states. (31) It certainly has little to do with socialism of any sort.
In Shadow State, the extraordinary level of corrupt behaviour that took
over the Zuma administration is convincingly linked to this outlook, and Zuma’s wide support base in the ANC, despite his extrusion of Julius Malema, were attracted to it and probably still are. Organisationally, the regular links Mandela and Mbeki had to big business fell away in favour of links to exclusively black organisations. Zuma found surprising allies in the Gupta family, originally a modest group of entrepreneurs running cooperative stores in a small northern Indian city. The Guptas over several years developed more and more grandiose plans in South Africa, were increasingly able to reward a wide range of South African clients – not always black – while becoming very rich themselves and infamously reached a point where they could name cabinet ministers – state capture indeed, as many accounts will tell you. The state SOEs were robbed of resources given the lack of finance otherwise directly controlled by the state and were close to being entirely wrecked. To cover their trail, the Gupta alignment needed to dominate broadcasting and control the tax system to benefit themselves, all of which the Shadow State team consider.
In a developmental state, this would by no means be so unusual, especially if we consider that South Africa already has a well-developed sophisticated bourgeoisie, albeit not black, that may well require challenging. The vision of an Mbeki probably did encompass the emergence of a class of black industrialists who were patriotic, who invested and employed labour under decent conditions. The Zuma gang liked to refer to their goals as ‘radical economic transformation’ by contrast to the constitution-minded slowpokes of the pre-1990 movement with their bent for compromise. Here
...was a vision of economic transformation that was not contingent on the reform of white ‘businesses’, and did not depend on the goodwill of whites to invest in the economy, to employ black people and to treat them as equals. (5)
However, Zuma and company had no ability to nudge the many ANC crooks and the Gupta machine in a genuine developmental direction. Instead, as is all too typical in Africa, wealth on a remarkable scale was just siphoned into spread-out hands and the developmental projects, as far as they went, were largely significant failures. There has been considerable corruption around the locomotive project which involved TRANSNET, which at least has some very real developmental and industrial potential. Less could be said for Zuma’s delight, the prospective purchase of a range of wildly expensive nuclear power plants from Russia. Zuma was not intelligent enough to figure out that Koeberg, the one plant we have, has been an uneconomic flop and useful to the old regime more as a means of scaring revolutionaries than as transforming electricity generation in the
What the Guptas, now languishing beside the Persian Gulf, really thought, we don’t know. But they were clearly mostly eager for themselves getting hold of mines; they had no intention, I would guess, of disrupting the mineral-energy complex dominance now stronger than ever in South Africa.
With Cyril Ramaphosa in the driver’s seat, the most egregious elements in the state capture scenario will not recur for now but the economic naivete of the ANC Zuma gang beyond acquiring personal fortunes and the empowerment obsessions of ANC politicians will not go away. He is surrounded by other party leaders who expected to serve with mrs. Zuma as the great leader’s preferred successor. The seedbeds of the Zuma project, often now identified with the future trajectory of Julius Malema, once a very well-off head of the ANC Youth League in his 20s, are certainly still there. This stimulating book would make an excellent first assignment to read in any politics course on South Africa today.
To turn to Pieter-Louis Myburgh’s Gangster State: unveiling Ace Magashule’s web of capture is to turn to a classic piece of South African investigative reportage. The picture Myburgh offers of Magashule is comprehensive enough, but he is reliant on interviews for many of his stories, and probably there is not much there which could nail Magashule in a courtroom without interviewees’ being willing to testify. The book gives a view of the middle levels of government where the Guptas played a growing but only secondary part. The space Magashule occupied until he became secretary-general of the ANC recently was essentially, although not entirely, provincial. He was the boss of the Free State and really nobody anywhere else in the country competed with him for hegemony and longevity at this level.
There were two analytical points that occurred to me reading this book. The first is that the ANC top brass knew what Magashule was like and tried for years to bring in people from the central party to reform Free State government. They would come in for a bit but they eventually failed because Magashule understood that the crucial bodies to be manipulated were the local party branches, no doubt full of hungry, would-be accumulators. These branches in the northern part of the province, notably his home town of Parys, he had sewn up and eventually the uitlanders were extruded again. The second point is what Magashule could provide: tender offers under his control. South Africa does have a nominally fair tender system if one excludes the racial provisions but this system, now
‘decentralised’, is easily circumvented or ignored. A piquant story from Myburgh concerns Magashule’s long-lost illegitimate daughter Thoko Malembe, abandoned for two decades in Tanzania but rewarded with lucrative tenders once she reappeared on his doorstep, as soon as she could wave a piece of paper showing that she had earned a university degree. This is like a South African caricature of an old-fashioned soppy Italian opera.
Finally, if readers want to find out more on the local level, both of these books refer us on to Crispian Olver’s excellent (2017) monograph on Port Elizabeth, State Capture at a Local Level: a case study of Nelson Mandela Bay, published by the Public Affairs Research Institute (PARI), Chipkin’s former research institute. Olver, sent originally to Port Elizabeth in 2015 by some of the more respectable ANC figures to sort out a mess, produced in the end a study of a city where there were too many cooks and not nearly enough broth. There was no godfather like Magashule in this case. As a result, a complex and sometimes violent rivalry which see- sawed power between changing factions became the way of things. In KwaZulu-Natal such rivalries have frequently led to murders reminiscent of the ‘tribal’ factional fights of the past in some respects. Olver’s book received a recent review by Doreen Atkinson (in Transformation 98) to which I can refer readers. Corruption is part of the problem, of course, but reading through all three books will allow contextualisation.