Critics of the 'elitist consequences' of black economic empowerment are trying to run away from the consequences of empowerment that puts capital and related resources in the hands of black people, writes Saki Macozoma.
A visitor from Mars would be forgiven for being confused by the babble that has passed for debate on black economic empowerment (BEE) recently. Much of the latest comment was triggered by a paper delivered by ANC Secretary General Kgalema Motlanthe to the Black Management Forum in September last year. Since then, so much ink has flowed.
It is clear the Secretary General intended to engender debate. It is a pity that, apart from a full reproduction in one daily newspaper, his comments have not been located in the context in which he presented in the paper. That does not mean Motlanthe was misquoted; the problem is selective quoting of his views.
A financial journalist, Itumeleng Mahabane, captured this problem in the Financial Mail shortly thereafter when he noted that the 'Jacobins' (ruling group) was losing the propaganda battle to the neo-conservatives. He observed: "Notice, too, how when one of the Jacobins questions the nature of BEE, it is only the point that questions the behaviour of his comrades that is spun, while finer points about the longer-term nature of the economy are lost."
This tendency in our media tilts the debate towards an emphasis on narrow issues and results in debates that generate more heat than light.
Before we address the criticism of BEE that we have distilled from the various writings and comments, let us return to our proverbial visitor from Mars. What would confuse them so much about the BEE debate? In the first place they would read all these comments, assertions, admonishments and fulminations and conclude that the transformation of the South African economy is a disaster.
In the second place, they would read headlines such as "Black middle class breaks through" and "Black consumers behind retail and property boom". There is also the 2004 edition of the Little Black Book, which by its increased size suggests that the list of black movers and shakers is expanding; and the encouraging story out of Statistics SA that suggests that the economy has stopped shedding jobs and is beginning to create new ones.
The Martian would wonder why these positive consequences of the agenda of transformation, including BEE, are not recognised, celebrated and brought into analytical criticism of the shortcomings of empowerment. They would be flabbergasted by the thinly veiled suggestion by some critics of BEE that the leading black entrepreneurs are responsible for the continued conditions of poverty endured by black people, and not the legacy of racist exploitation.
LEGITIMACY OF BEE
In dealing with some of the criticism of BEE let us start with the issue of the legitimacy of the process. What was thrown completely overboard in reports of the Motlanthe paper was its reference to the ANC national conference in Stellenbosch in 2002, which adopted resolutions that unambiguously support BEE and affirmative action.
The legitimacy of BEE is unquestionable, not only because successive ANC conferences have supported it. There is no other practical and effective instrument for South Africa to deracialise the economy within a reasonable time. There is no greater danger to the progress and stability of our society than the notion that a democratic society can be built on the shaky foundations of white citizens owning and controlling the economy along the patterns of apartheid, and black people controlling political power.
Many critics of BEE accept the need to deracialise the economy, but they think that the process has "elitist consequences". It is not alleviating poverty, but enriching a few. What did they expect? Where have you ever seen a capitalist system producing socialist results?
What these critics are trying to run away from is a consequence of empowerment that puts capital and related resources in the hands of black people. In this scenario black people become decision-makers and thus alter the business landscape and dislodge people from their comfort zones. When they speak about broad-based empowerment they mean that, where ownership has to change hands, it must be diffused through collective investment instruments so that the status quo in business South Africa prevails and is never changed.
In pursuit of the objective of clinging to economic power these elements are even prepared to commit class suicide. They are prepared to join those elements who believe that the capitalist system must be destroyed as long as they are leading a programme against black entrepreneurs. But they expect black people to be dumb enough to defend a capitalist system that seeks to exclude them by ossifying structures and patterns of accumulation that issued forth from the fungus of apartheid.
Is the BEE programme achieving its objectives of deracialising our economy?
The answer is yes. Yes, there are unintended consequences. Yes, the debates are necessary to sensitise all of us to some of the unintended consequences. The greatest tragedy that faces our society is that apartheid has denuded our people of the basic capacities needed to take advantage of BEE and help society move forward. We should be spending more energy enabling our people to take advantage of these opportunities.
We must stop propagating the dangerous lie that every person in our society is a potential business leader. As long as we have a capitalist society we will have some who will be more successful than others. The important issue is that we must remove all obstacles that may hinder an individual.
We must also stop propagating the idea that the BEE policy was ever meant to cure all the ills of our society. Black Economic Empowerment is one policy instrument among many. It is funny how so many condemn BEE because it is not broad-based enough and does not alleviate poverty. They are often the same people who oppose any policy intervention directed at poverty alleviation and other programmes of social capital formation aimed at the masses.
We must accept that the debate on BEE is partly ideological, that it is emotional and will always be fraught with difficulties and challenges. We must engage in these debates vigorously and robustly.
However, we cannot get ourselves into a state of paralysis. We have the urgent business of transforming our society. Most forward-looking businesspeople will take note of the debates and even participate. But they will take decisions about empowerment that secure their own strategic interests. They may be criticised in the short term, but their companies will occupy better space in society than their competitors in future. In doing empowerment deals they will look for partners that will make a strategic impact in their businesses.
Jack Kolen, Managing Director of the Monitor Group, captures this issue well when he says: "The most significant potential strategic impact of BEE lies in new owners altering the strategies of their newly acquired business, typically raising the level of 'biodiversity' in an industry."
It is these kinds of entrepreneurial interventions that will alter the way South African capitalism functions and put it on a trajectory that will make it more efficient to the benefit of the greatest number of our citizens.
Saki Macozoma is a member of the ANC National Executive Committee. A version of this article first appeared in the Sunday Times, 10 October 2004.
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