South Africa: Communist youth leader -- `Black economic empowerment becomes Zuma economic empowerment'

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By David Masondo, Young Communist League chairperson

September 5, 2010 -- City Press -- There was cautious optimism among many leftists in the African National Congress (ANC) that the ousting of Thabo Mbeki in Polokwane [the ANC's 2007 national conference] might mark a shift towards a much more egalitarian economic policy, including "Black Economic Empowerment (BEE).

Instead, BEE is increasingly becoming too narrow, amounting to ZEE – that is, Zuma Economic Empowerment.

The recent ­multibillion-rand Arcelor-Mittal BEE deal involving Duduzane, President Jacob ­Zuma’s son, is another example of how BEE has become too narrow.

To crown it all, the president’s nephew, Khulubuse Zuma, seems to have suddenly become an African imperialist, amassing oil resources in the Democratic Republic of Congo.

ZEE is not only an assault on the Young Communist League and South African Communist Party (SACP) resolutions – which called for the nationalisation of ­monopoly industries – it amounts to a burial of the Freedom Charter.

Only a few can be misled to believe that there is no link between ­Zuma’s rise to the presidency and his ­family’s rise to riches.

One’s leadership position in a political ­party, particularly the ANC, allows one to gain and/or retain access to the institutional power that makes one the preferred ­candidate for white business to select to be part of its established enterprises.

These politicians rely heavily on the control of ­organisational power to generate wealth. ­Access to the state provides politicians with leverage to select those who can acquire shares in white-owned firms.

South Africa’s political system is based on a multiparty electoral democracy. Access to state institutional power is achieved through elections. Consequently, many politicians are interested in party politics.

Since they ­rely on organisational power for wealth accumulation, potential and actual entrepreneurs find it rational to contest directly or indirectly for political organisational leadership positions as an entry point to the state and its economic resources.

However, not every political party matters.

Because the ANC is backed by the SACP and the Congress of South African Trade Unions – not to mention its history in the national liberation struggle – it is highly supported by the electorate and, therefore, matters.

Individuals acting within and through the state have the power to decide who gets state-owned resources.

However, the fact that individuals in the state have this ­institutional power does not mean we will know ­beforehand which black politicians will secure access to these resources.

This is mediated by a dominant political party in government.

The BEE model is structured favourably for politically connected politicians and their proxies to enter into business through the state.

The state owns key economic resources ­required by business that can only be ­accessed with state permission. The state acts as a purchaser of services from the ­private ­sector.

Through its financial institutions, the state acts as a money lender. It is also a grantor of licences for, among other things, mining rights. Through privatisation, it acts as a seller of its assets.

Business can gain access to state-owned resources through a BEE criterion that ­requires black people to be owners and managers of enterprises. White businesses can use black people who are politically connected to gain access to these resources – and more recently, as a means to deflect ANC Youth League calls for nationalisation.

This explains why certain black millionaires associated with the liberation movement have been cherry-picked by white businesses.

The BEE model has promoted ­competition among politicians for access to institutional power and co-option by white business.

This competition finds expression in political conflicts within the ANC and the state.

We are indeed on the wrong economic ­redistribution path.

BEE has become a ­family affair. Children whose parents are not politicians will have to lift themselves out of poverty by their own bootstraps.

The youth’s cynical acquiescence of ZEE may find concrete expression in ­non-participation in political activism, ­including voting.

After all, why vote if voting means empowering politicians to empower their children?

[David Masondo is chairperson of the Young ­Communist League, the youth organisation associated with the South African Communist Party. This article first appeared in the Johanessburg-based City Press.]

Young lions must be at forefront of struggles of the poor

By Castro Ngobese

September 9, 2010 -- Sowetan Live -- Karl Marx warned that: "History repeats itself, first as tragedy, second as a farce."

Recent attempts to isolate and embarrass the national chairperson of the Young Communist League, David Masondo, after his article in City Press [above] requires critical analysis.

Masondo's article -- attacking the manner in which family ties and connections have been utilised to secure lucrative BEE deals for those related to President Jacob Zuma -- offers an honest and refreshing analysis.

In fact, on closer reading of the YCL statement one notices that no substantive reasons have been tabled by the so-called national office-bearers of the YCL that require the organisation to distance itself from the views expressed by Masondo [see comments below].

It seems communists had different conceptions about the role of working-class formations during the post-Polokwane period.

When former president Thabo Mbeki used the ANC to secure deals and pave the accumulation route for those close to him, the YCL was among the first to condemn this.

The bourgeoisification of the ANC leadership was regarded as a threat to the working class and the poor in this country.

It was this bourgeoisification of the ANC that invited so much anger after the organisation was used to secure deals for the likes of Smuts Ngonyama in one of the country's most powerful parastatals -- Telkom.

During the post-Polokwane period, we expected working-class formations to engage in a process of rebuilding, of deepening their independence and fighting for a reconfigured alliance as well as ensuring that the working class fared better under Zuma.

Instead, what we see is a criminalisation of dissent, subjugation of working-class organisations such as the YCL and certain individuals and the prioritisation of participation in the state over and above building a mass base for working-class organisations.

Instead of demobilising criticism and telling the working class to hold its tongue until they reach the promised land, the YCL should be actively taking part in the struggles against labour brokers and high unemployment and HIV-AIDS prevalence that affect poor young people the most.

The YCL should be visible in the picket lines when workers are waging an assault on capital.

The league should be fighting all those who utilise the state and our organisations to secure lucrative tenders and narrow BEE deals for self-enrichment.

In all corners of the country there is a serious disillusionment with the manner in which leaders are driving the latest luxury cars, are swimming in extravagance, and the way in which communities in Diepsloot and Orange Farm must struggle to eke out a living in crowded shacks while shopping malls and golf estates are being constructed at an accelerated rate.

The working class knows that it is not a matter of coincidence that those who are related to Zuma have suddenly become instant billionaires!

These are realities we should remember as we ponder on questions relating to alliance unity and cohesion.

Choosing which horse to bet on during the coming congresses must always be a tactical consideration.

This being so, betting on a certain horse should not mean that that horse must have unlimited space to pour dust and grass in the eyes of the working class and the poor in this country.

[Castro Ngobese is a former national spokesperson of the Young Communist League of South Africa. He is also spokesperson for the National Union of Metalworkers of South Africa. This article was written in his peersonal capacity.]

Submitted by Terry Townsend on Tue, 09/07/2010 - 22:18


Irvin Jim
15 August 2010

Irvin Jim questions steel giant's purchase of Imperial Crown Trading

NUMSA Statement on the ArcelorMittal and Imperial Crown Trading Looting Scheme

1. The National Union of Metalworkers of South Africa (Numsa) is dismayed, disgusted and shocked by what clearly appears to be a get-reach-quick scheme involving a so-called BEE consortium, Imperial Crown Trading (ICT) 289. The scheme, recently announced by ArcelorMittal, includes the buy-back for R800 million of the iron ore mineral rights previously allocated to ICT.

2. Numsa is aware that many allegations have been made regarding the allocation of mineral rights previously owned by ArcelorMittal by the Department of Mineral Resources (DMR) to ICT. This occurred after ArcelorMittal failed to comply with the mineral rights act and did not re-apply for the mineral rights on time. Allegations were then widely reported that ICT is a fake company with absolutely no capacity to mine iron ore. All that seemingly qualified them to earn the rights were their strong political links to key centres of political power.

3. Numsa rejects with contempt the dubious deal permitted by DMR. It seems that the deal was allowed and that millions will change hands, despite the fact that ICT appears to have possessed no capacity to utilize the rights it was granted.

4. A further question is how ICT is permitted to sell the rights back to ArcelorMittal without the direct involvement of the DMR?

5. If the department has in fact approved the deal, on what basis can it have done so, given the obvious atmosphere of corruption that surrounds it? DMR has a lot of explaining to do.

6. Numsa wants to put on record that when the Iscor was originally unbundled, government correctly stipulated two conditions: firstly, iron ore was to be supplied at a cheaper price to ArcelorMittal; secondly, ArcelorMittal should supply cheap steel to downstream industries to ensure that the value chain bolstered local manufacturing capability on the basis of the competitive advantage inherent in local mineral resources.

7. Numsa wants to put on record that Arcelor-Mittal has however abused its access to a cheap supply of iron ore by in return fixing import parity prices for steel in South Africa. It has shown absolutely no regard for government's original objective of making available cheaper steel to downstream industries to help build our own manufacturing base.

8. Numsa takes the view that it is incumbent on both Arcelor-Mittal and ICT to prove wrong, commonly held suspicions that this is a corrupt deal.

9. Arcelor-Mittal has concluded the deal with ICT despite being aware that Kumba resources had already embarked on court processes challenging the way in which rights were allocated to ICT. Given this, Numsa questions Arcelor-Mittal's sincerity and commitment to clean business practices. We get the impression that they are prepared to use their massive financial resources to pay off ICT and maintain their industry dominance at any cost.

10. That ICT is now included in Arcellor-Mittal's R9 billion ‘empowerment' deal, brings into question the whole process of allocating mineral rights and the framework government is using in adjudicating such processes.

11. The impression might also be created that, given ICT's manifest lack of capacity, they were co-opted from the start by Arcelor-Mittal to shore up its dominant position in the market.

12. By maintaining a monopoly position in the steel industry, Arcelor-Mittal limits access to affordable steel, slows down industrialization, and effectively sabotages government's industrial policy aims.

13. Numsa believes that ICT is not a credible company and doubts that criteria used by DMR in adjudicating allocation of mineral rights to it were bona fide. It seems likely that the two companies have colluded with each other and abused their financial muscle and political contacts to obtain mineral rights. These rights are the heritage of our people and we call on the DMR to conduct an investigation and explain what actually occurred.

14. Numsa further calls on the ANC, and the ANC government, to mandate the cabinet to intervene to reverse these seriously embarrassing deals. If they are allowed to stand, they can do the country no good. The image of BEE, intended as a critical progressive measure to deracialise the South African economy, could otherwise be permanently tarnished.

15. Unfortunately this latest Arcelor-Mittal-ICT looting scheme only raises broader questions about the political appropriateness of BEE measures.

16. Strategic resources of our economy should not be turned into a haven for profiteers and well-connected BEE parasites. They must instead be used to benefit the ordinary workers and poor of our country.

17. Arcelor-Mittal should be a strategic entity that helps drive industrial development and create jobs, alleviate poverty and provide opportunities for sustainable livelihoods for workers and the poor. 

18. We further call on the Cabinet to undertake a comprehensive review of all BEE deals. These should contribute to developing an industrial strategy as part of our overall developmental agenda.

19. We call on our own ANC government, as the custodian of all mineral rights on behalf of South Africa's people, to take back this 21, 4% shares that are manipulated by both ICT and Arcelor-Mittal and to use them to set up a state mining company as the resolved at the Polokwane conference. This could permit a supply of cheap steel to drive industrialization and boost manufacturing capacity.

20. We reiterate our call for the nationalization of Arcelor-Mittal and its return to the hands of the people as envisaged by the Freedom Charter, which unapologetically states that: ‘the people shall share in the country's wealth'.

Statement issued by Irvin Jim, NUMSA General Secretary, August 15 2010