Crises of reconciliation and leadership interlink

SOUTH Africa is experiencing at least two seemingly unrelated crises at present: a crisis of reconciliation and a crisis of leadership.

What do the failings of leadership in our country have to do with the failure of South Africans to overcome our differences and prejudices, 20 years into our democracy?

Looking back at the Truth and Reconciliation Commission, which held its first hearings here in East London 20 years ago, on April 16, it seems, in some ways that we are more divided now than ever, with not a credible voice left standing to defend the illusory solidarity of the mythic Rainbow Nation.

Yet fairly recently, during the Fifa World Cup, we seemed to stand, united, together. What went wrong? The basic problem: we’ve run out of credit. We’re in serious debt and growth is collapsing, while inflation and interest rates rise.

We are not alone. The economic problems we are currently experiencing belong to a huge set of problems now facing emerging markets, caused by the Great Recession that kicked off with the financial crisis of 2008, when massive trade imbalances and a debtfuelled bubble the size of the planet was burst by the US sub-prime mortgage crisis.

The International Monetary Fund now says debt levels are at their highest level since World War 2.

In the wake of 30 years of deregulated globalisation, what happened, in basic accounting terms, was a systemic failure of reconciliation.

Account reconciliation is a critical, yet under-appreciated control to help ensure an organisation's financial integrity.

It involves checking that two sets of records (usually the balances of two accounts) are in agreement.

Reconciliation ensures that the money leaving an account matches the money spent.

What sparked the crash of 2008 was that toxic, high-risk mortgages were packed together in diversified “CDO” portfolios with other debts and sold on, in the form of increasingly complex and opaque derivatives, around the world to spread risk.

Ratings agencies (shops) cheered on this charade during the long bull market. Crisis came when the US housing market collapsed and investors caught wind of the amount of junk debt smuggled in their supposedly AAArated packages. Looking back at South Africa’s national reconciliation vehicle, the TRC, too few reparations were made to too few of the qualifying victims of injustice and too few perpetrators who failed to come forward to apply for amnesty, were prosecuted.

Individualistic, Western retributive justice was sacrificed (to avoid quid pro quo retaliation) and traded for the communal reconciliation better associated with African restorative justice. Yet there has been little to no restoration. The long process of forgiveness was truncated in court and amends were not made. Too many instances of injustice were bundled into the final settlement package as vague, forgotten promises.

Our President Jacob Zuma appeals to this failure so as to pool together the organisational support that may save his bacon.

Whatever cadres may think privately about the Constitutional Court judgment and allegations of state capture, they endorsed their party leader, standing united against the opposition’s calls for greater accountability, sacrificing conscience for consensus.

This reflects a long tradition of disciplined loyalty cultivated during the ANC’s years as an underground organisation, though it was practised differently under previous leaders, such as Oliver Tambo and Nelson Mandela.

They showed that leadership involves an ability to put forward a unified position which best expresses and commands diverse interests.

Leaders cannot force unity for long by suppressing dissent without losing legitimacy.

How many poorly performing BBBs are now stacked against the investment grade reputation of the party of liberation?

Compared to the numbers exposed by the Panama Papers, the outcry over public spending on the president’s overpriced retirement home seems a bit overblown. But the president is a role model and, in this case, his misdeed represents a crisis of accountability that extends far beyond him, to the alleged capture of party and state structures by wealthy private interests.

Further still, these local instances point to a global crisis of accountability among world leaders, as exposed in the records of tax havens, in investigations into Fifa, in the Petrobras and other scandals of Brazil, in the crackdown on corruption in China; the list goes on.

As all the books are audited and accounts reconciled, it is increasingly clear that the speculative benefits of uninhibited global trade do not add up.

With most of the profits buried in offshore islands, a crisis of legitimacy is developing; all the while, populist fundamentalism spreads among the poor majority who bear the brunt.

Forget liberalism; expect authoritarian nationalism, repression and trade wars.

When things go well in accounting practice, reconciliation is just a simple, satisfying cancellation of debits against credits.

Yet this innocuous task of reconciliation is intimately connected to truth and accountability.

The truth of a general report is established by the reconciliation of its embedded accounts.

Hyped up by a commodities boom and a hot flood of quantitative easing bailout funds that flowed into high yielding emerging markets, such as Brazil, we spent our good credit as if there was no tomorrow. During the build-up to our spectacular hosting of the Fifa World Cup we all blew our collective vuvuzelas together as one.

Now we’re drying out in the bright heat of debt, individually.

To attempt national reconciliation after apartheid, as we did with the TRC, was not a simple task of ticking debits against credits. The great hope was that, if we uncovered the truth of our differences after the period of apartheid, this would help us heal our broken nation by forcing us to engage in a wider process of atonement, forgiveness and reconciliation.

But as Archbishop Desmond Tutu reflects, we possibly saved the patient in the ICU with the TRC but we then left her lying unattended in the general ward.

Reconciliation and leadership both involve bringing together differences under a general result. Neither imposes, nor substitutes, illusory unity over underlying differences but instead should reflect a balanced view of all the diverse, individual transactions taking place in the unified position.

During the recent impeachment debate in parliament, ANC MP Pule Mabe made a plea for forgiveness with a quote from the Bible.

In this context it is worth recalling a plea for freedom of conscience made in 1783 by the German Jewish philosopher Moses Mendelssohn: “Brothers, if you are for true piety, let us not feign agreement, where diversity is the evident plan and purpose of providence. No one thinks and feels exactly like his fellow man. Why do we wish to deceive each other with delusive words?”

We lay the blame for our disastrous conditions on the president but live in a democracy. Zuma represents too truly our indifference to the careful task of reconciliation that overtook us when the going was good.

If we want to live together, we all need to take account.

Dr Christopher Allsobrook is director of the Centre for Leadership Ethics in Africa at the University of Fort Hare http://leadershipethicTRC sinafrica.wordpress.com