The recommendation for criminal charges is particularly applicable to Mr Anoj Singh and Mr Koko, who by false pretences led Eskom, through the officials who processed the R659 million payment, to believe that the R659 million payment was in the nature of pre-payment for coal, as was the R1.68 billion pre-payment, later converted into a guarantee, when in truth and fact they knew that the prepayment and the guarantee were needed to enable the Guptas to complete and save the sale of share transaction.
If you are one of those voters obsessed with the scourge of corruption and you are not appalled by Ramaphosa’s role in the Marikana massacre or by the Life Esidimeni scandal in which the ANC government killed 143 people at psychiatric facilities in Gauteng, you may be poised to cast your vote next week for the African National Congress (ANC) in order to strengthen President Cyril Rampahosa’s hand in his fight to root out corruption. But what if the prevailing narrative about corruption, and the assumptions about Ramaphosa’s ability to deal with it, are all wrong and your vote is wasted?
Most voters who support “Cyril’s ANC” in order to strengthen his hand to weed out corruption, probably applauded when top leaders of the ANC forced then President Jacob Zuma to fire Des van Rooyen as Minister of Finance only four days after his appointment. The same voters might, however, be less enthusiastic if senior ANC leaders forced President Cyril Ramaphosa to reverse course in order to prevent the largescale arrest and prosecution of people involved in ANC-linked patronage networks.
A recent academic paper written by Prof Karl von Holdt, Senior Researcher (former Director) of the Society Work and Politics Institute (SWOP) at the University of the Witwatersrand, entitled The Political Economy of Corruption: Elite Formation, Factions and Violence, suggests that many South Africans cannot comprehend the possibility that Ramaphosa will be forced to reverse course because their understanding of corruption in South Africa is far too simplistic.
As an aside, I always wonder why so many middle and upper-middle class white voters are obsessed with corruption – sometimes to the exclusion of concern about economic inequality or racial injustice – when they are the least affected by corruption. Their reliance on the state to provide basic services is limited because they have medical aid, can afford private security measures and expensive school fees, have their own transport and – in some cases – even have access to alternative sources of electricity.
Could it be that for many (but not all) members of this group corruption is not only a burning issue because it has catastrophic consequences for the most vulnerable in society, but also because it allows them to express their deepest racist fears about a black-led government in a politically “acceptable” manner?
In any event, Prof Von Holdt argues that instead of viewing corruption merely as a moral or criminal justice issue, we should understand that corruption is also a mechanism of class formation. Simply put, he argues that some forms of corruption – with its own moral code and strict informal rules – are used as a mechanism to redistribute wealth and contribute to the building of a black elite class.
Von Holdt points out that in post-1994 South Africa many of the barriers hindering the economic advancement of black South Africans within the formal economy remain intact, slowing the pace of economic transformation:
Given the property clause in the Constitution, as well as the conservative strategies adopted by the ANC government, and in the context of economic domination by large corporations and white owned businesses, there was little alternative for channelling the aspirations and burning sense of injustice of black elites and would be elites in post-apartheid South Africa. The state – newly re-nationalised by the liberation struggle – had become the only channel for the emergence of these aspirant classes, given the scope of its resources and activities…. In this context, the state is the location of jobs, revenue, contracts, tenders and licensing and is an obvious resource in the formation of a new elite.
Ironically then, the failure to transform the economy probably contributes to the “corruption-ification” of South African politics. When beneficiaries of corruption invoke “white monopoly capital” they are doing so in a cynical attempt to avoid accountability, but if you take a long view, the slogan is not as far-fetched as some might think.
(There is a difference between trying to understand a phenomenon and to approve of it. I do not argue that corruption in South Africa is morally justified. It largely benefits large white owned companies, emerging elites, and other individuals associated with patronage networks. The majority of South Africans are excluded from its “benefits”. Moreover, corruption has a devastating effect on the lives of the most vulnerable and marginalised in society and it is a good thing to try and eradicate it and to try and effect broad based redistribution in legal ways.)
While this process of accumulation sometimes occurs outside legal boundaries, its aim is often to create a second or third generation of middle-class citizens who operate respectably within the confines of the law.
When I heard this argument last week at a talk given by Prof Van Holdt at UCT, it reminded me of an article published in 2014 in The New Yorker magazine explaining how crime (especially involvement in the New York mafia) was the means by which many Italian immigrant families in the United States were able to transcend their humble origins. The article explained that many of the children and grandchildren of mafia bosses have become upstanding wealthy upper middle-class citizens who would not dream of getting involved in crime.
Whatever the causes of corruption might be, Von Holdt argues that corruption is embedded in South Africa’s political system, a system shaped by the intersection of patronage and factionalism. Patronage networks form political factions in order to gain power in the state. Contrary to the prevailing public narratives, the purging of the Zuma-Gupta network from positions of influence and power, and even their jailing, will not lead to the demise of this system because corruption is embedded in the DNA of the political system. No President can have a zero tolerance of corruption and survive politically for long.
Whether the ANC, the DA or the EFF governs (either alone or in coalition), some accommodation with corruption will be required because that is the only way in which the system can function and can garner support from important elite constituencies. Various cases of alleged corruption in the Tshwane municipality run by the DA with assistance from the EFF illustrates that corruption is not unique to the ANC but is endemic of our political system.
Assuming that Ramaphosa is serious about tackling corruption, he faces two specific problems over and above the fact that corruption is now embedded in the political process in South Africa. First, Ramaphosa only came to power with the assistance of various groups implicated in corruption. There was no other way for him to be elected President of the ANC. As Von Holdt points out:
The staunchly pro-Ramaphosa leadership of the Eastern Cape are implicated in the plundering and institutional decay of Nelson Mandela Bay detailed in Olver s 2016 book. The deputy chair of the ANC in KwaZulu-Natal, who played a leading role in mobilising support for Ramaphosa in that Zuma-supporting province, Mike Mabuyakhulu, has just been indicted in court with seven co-accused for corruption and money- laundering. Not only was Mpumalanga s support crucial to Ramaphosa s victory as noted above, DD Mabuza s position as deputy president puts him in line for the presidency in ten years time.
Second, because of the narrow margin of his victory, Ramaphosa does not have the same authority within his party that Jacob Zuma had after his election and especially during the first years of his second term as President. Ramaphosa has had to move cautiously to establish his authority within the party, and has been forced to adopt a strategy of “unifying” the ANC (including unifying with those implicated in corruption) while facing powerful resistance from within.
Ramaphosa is therefore likely to remain vulnerable to the same kind of populist challenge as Jacob Zuma posed to Thabo Mbeki as unemployment, poverty and inequality will remain desperately high and the faction opposed to Ramaphosa may gain strength as attempts to shut off access to state resources for accumulation will starve aspirant elites of opportunities for wealth-making, causing a backlash.
Von Holdt believes Ramaphosa needs to cobble together a relatively stable coalition to ward off a challenge to his power threatened the faction that lost the presidency at Nasrec. This coalition is also needed to allow him to begin the process of fixing state institution deliberately destroyed as part of the Zuma project.
Maintaining such a stable coalition without turning a blind eye to some corruption is a close to impossible task given the fact that politics in South Africa occur in the intersection of patronage and factionalism. As the Des van Rooyen saga shows, it would not be necessary for Ramaphosa opponents to oust him as ANC President or as President of the country in order to clip his wings. All they need to do is to build a majority coalition within the NEC and NWC, after which they would be able to block any controversial anti-corruption measures. They will then also be able to secure protection for themselves and their patronage networks.
In order to survive and in order to govern effectively, Ramaphosa may therefore have to build his own coalition which would have to include a majority of factions in the ANC, and this means including key figures and networks of corruption. Von Holdt argues that the more such figures are excluded, the more scope there is for disruption and counter-mobilisation against the Ramaphosa coalition and concludes:
Stabilising such a coalition would necessitate a tacit deal protecting key figures from prosecution and permitting continuing forms of primitive accumulation in order to allow ongoing elite formation, even if on a more modest scale. Such a tacit deal would have to include an understanding regarding the distribution of opportunities and rent-seeking across the coalition. From Ramaphosa’s point of view, this would be the necessary price for establishing sufficient political stability to pursue his goals. On the other hand, he would be seeking to limit institutional damage to the state and thus establish some form of managed corruption.
Von Holdt is not optimistic that Ramaphosa will succeed in building such a stable coalition that will allow him at least to manage corruption and to begin the task of rebuilding the state. He therefore concludes on a rather pessimistic note, suggesting that change might not come through the ballot box, but rather by activism outside formal constitutional structures:
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The above prognosis suggests that a liberal democratic constitutional order is unable to contain the contradictions produced by 370 years of settler colonialism. Neither of the two economic trajectories on offer seem to address these contradictions – deeper marketisation which further disembeds accumulation and life, or rampant primitive accumulation…. Can an alternative counter-movement to re-embed social and economic development be imagined?