who runs south africa?
The power 100
From the fight between white capital and new money, to the institutional framework holding back the clique at the top, the inner workings of South Africa.
In a particularly opulent mansion in the Bishopscourt suburb of Cape Town – one of the wealthiest in all of Africa – a well connected business grandee decided to throw a house-warming party in February. It was that week when the opening of parliament coincides with the Mining Indaba, so every serious South African politician or businessperson was in town. Quite a few showed up at the party. Set out on several levels, with the outcrops of Table Mountain behind, were the expansive gardens with their manicured lawns. Sipping a glass of Chenin blanc on one of the many terraces, a wit remarked: “So the Great Gatsby finally meets the Western Cape.” Although the host was less reclusive than Jay Gatsby, the main event that evening was the guest list. On the other side of the pool, a group of billionaires, as identified by the wit, were huddled conspiratorially around a government minister. At the next table, a hedge fund owner was languidly puffing on a Cohiba while listening to advice from an excitable young currency trader: “You’ve got to understand that [finance minister] Pravin [Gordhan]’s sacking is a huge opportunity to short the rand. Are you in my friend?” Two tables down, a clutch of mining barons lamented – with no obvious fear of contradiction – that South Africa’s economy was being driven off a cliff, their industry in particular. A couple of senior figures from the governing African National Congress (ANC) nodded in assent. One, formerly a senior minister, took the analysis further: “The mining minister invites 6,000 investors to the Indaba, then disappears without answering serious questions.” The other ANC man sighed, launching into a description of life in the presidency under Jacob Zuma: “They’ve tripled the civil servants there to a thousand, and they’re sitting there playing Monopoly and solitaire on their computers.” That evening, it was a little like being the White Queen in Lewis Carroll’s Through the Looking-glass: one was expected to believe six impossible things, in this case, before the last dram of 25-yearold Laphroaig. From the witness statements of the assembled guests, South Africa’s political economy was evidently in a state of terminal collapse. The politicians were out of control, all the institutions had been thoroughly criminalised. Yet there they all were, sitting on substantial assets in a nearly $500bn economy, speaking with peculiar relish about an Armageddon they could not seriously contemplate. One man, describing himself as a gentleman farmer, started sounding alarms about “land seizures à la Zimbabwe”. His companions cast nervous glances at the verdant surrounding valleys. “But it can’t happen here,” one said with pleading desperation. So when asking the question: “Who runs South Africa?”, it is useful to preface it with another – “Who owns South Africa?” That is easier to work out, despite the problematic data. Some 27 years ago at the time of its liberation election, South Africa was level-pegging with India and Brazil as one of the world’s most unequal societies. Today, its incomes and assets are more unequally distributed than either of the other two countries. Elected on a platform of creating economic opportunities and spreading the wealth, the ANC now talks of the need for “radical economic transformation” after two-and-a-half decades in power. So who has been running South Africa? In truth, power is as concentrated in as few hands as it was before liberation. The corporate chiefs, hand-in-hand with the hereditary landowners, still have huge influence over policy-making and implementation. That influence is often bought, sometimes in rand or dollars, sometimes with entrance tickets to the magic circle. The co-option of the political class has accelerated. That largely explains why company owners and directors and their lawyers and accountants are so unanswerable to the government, to the voters, even to their shareholders. Yes, institutions and activists are struggling with this. Meanwhile, the new ruling class – an unhappy marriage between posturing political leaders and corporate power – looks set to bump along regardless.
In truth, power is as concentrated in as few hands as it was before liberation