Hark the ANC’s radical roars

Business people are going to need to brace themselves for the ANC’s policy conference, which begins on Friday. As the economy declines and revelations about the looting of state resources increase, the self-proclaimed “radical” element of the ANC has dual incentives to amplify the revolutionary rhetoric.

First, they need to try to win back popular support and particularly, outmanoeuvre the EFF. And second, they need to divert attention from the runaway corruption that is increasingly becoming a huge political issue. So, expect dramatic headlines and fiery speeches in which speaker after speaker endorses the notion of “radical economic transformation” and all its affiliated ideas.

Yet it is important to note that the conference is not, in fact, a decision-making entity. It merely proposes policy that may or may not be adopted at the ANC’s elective conference at the end of 2017. The history of the conference provides little guidance as to what the ANC will actually do.

For example, the ANC’s 2012 policy conference focused on the need for a “second stage of the transition”, and all but ignored the National Development Plan (NDP). But at the end of the year, President Jacob Zuma opened the ANC’s December conference with a ringing endorsement of the NDP. On the other hand, that was pretty much the last anyone heard about the document.

The real issue is what the policy calls made at the conference say about who is winning in the leadership stakes, and, in that sense, this conference is pivotal. The more policies that style themselves as “radical” win the day, the more it would suggest Nkosazana Dlamini-Zuma is in the lead. The more the policies reflect existing ANC positions, the more it might suggest Cyril Ramaphosa is ahead.

However, the process is bound to be complicated, not least because neither Dlamini-Zuma nor Ramaphosa has been particularly clear on what their own vision might entail. But for both sides — perhaps more particularly for Dlamini-Zuma — the big danger is that the ANC will paint itself into a policy corner in which it binds itself to introduce ideas that are not compatible with a modern economy. That danger is very real.

Perhaps, the most obvious of these is changing the role of the Reserve Bank to force it to abandon its inflation-curbing mandate. The door on this topic was opened by Public Protector Busisiwe Mkhwebane, who instructed Parliament to introduce legislation to change the constitutional mandate of the Bank. The move was widely criticised, most vocally by the Bank itself, and a court case is now likely.

But since then the issue has gained some traction, notably from Deputy Finance Minister Sfiso Buthelezi, who has invited “discussion” on the subject of inflation targeting, which is often a coded way of inviting support for changing policy.

The problem is that the economics behind the desire to scrap inflation targeting are shockingly destructive. You would have thought the wholesale destruction of Zimbabwe wrought by rampant inflation would be enough to convince the most wavering ideologue in its neighbouring country of the dangers of this approach. Sadly, it turns out, this is not the case.

Many other policy ideas favoured by the faction fighting “white monopoly capital” are similarly based on ideas that hark back to idealistic economic gibberish spouted in the days of the Soviet Union. They are rooted in a combative, sectional view of the world in which great forces are pitted in an existential war against each other.

It’s a nihilistic notion that is light years away from, for example, former president Nelson Mandela’s idea of a rainbow nation that belongs to all who live in it. Yet it is frighteningly close to becoming real.

THE REAL ISSUE IS WHAT THE POLICY CALLS SAY ABOUT WHO IS WINNING IN THE LEADERSHIP STAKES