This cheap pro­pa­ganda in favour of Ramaphosa’s can­di­da­ture de­serves to be con­signed to the rub­bish bin,writes

The Sunday Independent - - DISPATCHES -

ON NOVEM­BER 3, Stan­dard Bank se­nior po­lit­i­cal econ­o­mist Si­mon Free­man­tle pub­lished a re­port, The prospects for and im­pli­ca­tions of an NDZ win. The for­mat in which the re­port is writ­ten is cal­cu­lated to make it ap­pear at first glance as if it is ob­jec­tive.

How­ever, the fur­ther one reads the more the mask of aca­demic pre­tence drops and ques­tions arise.

The re­search is weak and shal­low. It ap­pears to be mostly a cut-and-paste job from bi­ased news­pa­per ar­ti­cles that were writ­ten as anti-Dr Nkosazana Dlamini Zuma smear pieces.

One can­not help but won­der why a se­nior po­lit­i­cal econ­o­mist would pro­duce such shoddy work. Was Free­man­tle un­der pres­sure from his em­ploy­ers at Stan­dard Bank to de­liver a doc­u­ment that could be used to de-cam­paign Dlamini Zuma?

Was he given in­struc­tions on what the con­clu­sions of his so-called re­search should be?

This flimsy doc­u­ment cer­tainly has all the ap­pear­ances of Free­man­tle abus­ing his aca­demic cre­den­tials in or­der to cre­ate the fake im­pres­sion of aca­demic ob­jec­tiv­ity, while it is a piece of bi­ased pseudo-aca­demic pro­pa­ganda.

Is the re­port really in­tended for Stan­dard Bank clients? It pur­ports to be for in­ter­nal use only, Stan­dard Bank and its clients – and not for pub­lic dis­tri­bu­tion – but within hours af­ter it was in­ter­nally re­leased, it was posted in PDF for­mat all over so­cial me­dia net­works.

A concerted ef­fort was made to dis­trib­ute it as widely as pos­si­ble and to reach the big­gest pos­si­ble au­di­ence. Not only does the doc­u­ment dis­play all the traits of a pro­pa­ganda piece, but the man­ner in which it was dis­trib­uted – with the clear in­ten­tion to reach and in­flu­ence the widest pos­si­ble au­di­ence – also seemed like pro­pa­ganda.

As far as “ser­vic­ing the client base of Stan­dard Bank”, the re­port must be seen as of lit­tle value to the clients since it is based on hardly any sci­en­tific ground­ing for busi­ness fore­cast­ing. For ex­am­ple, re­gard­less of the out­come of the ANC’s na­tional elec­tive con­fer­ence next month, the rat­ing agen­cies might down­grade South Africa.

It is a fact that Moody’s and Stan­dard & Poor’s will de­cide not only on their bi­ased po­lit­i­cal in­ter­pre­ta­tions, but also based on in­ter­na­tional eco­nomic trends, which the gov­ern­ment has lit­tle con­trol over, to down­grade South Africa. Mar­kets are well aware of this and have started to fac­tor that into their plan­ning.

Free­man­tle refers to the nar­ra­tive of “fis­cal downslide” if Dlamini Zuma wins. How­ever, in con­trast to the leaked rec­om­men­da­tion of the He­her Com­mis­sion on free ter­tiary ed­u­ca­tion, that it is not fea­si­ble from an eco­nomic/fis­cal per­spec­tive, Cyril Ramaphosa in his cam­paign – sim­i­lar to the strong po­si­tion Dlamini Zuma has taken in favour of free qual­ity ed­u­ca­tion – has in­di­cated that “stu­dents need free ed­u­ca­tion”.

This is in con­trast to the leaked find­ings of the com­mis­sion that it is not af­ford­able. It must be noted that the com­mis­sion’s find­ing is con­tro­ver­sial, that it is dis­putable and needs fur­ther re­search and po­lit­i­cal con­sid­er­a­tion. It is cer­tainly not a “proven eco­nomic fact” that free ter­tiary ed­u­ca­tion will lead to a fis­cal downslide.

De­spite be­ing a se­nior po­lit­i­cal econ­o­mist, Free­man­tle ig­nores this and in a bi­ased man­ner treats it as a so-called fact.

He uses this to ar­gue that her strong pol­icy po­si­tion in favour of free qual­ity ed­u­ca­tion will lead to a fis­cal downslide.

Fur­ther­more, he uses the nar­ra­tive that poli­cies “such as this will de­liver a mes­sage to the mar­ket of po­lit­i­cal and pa­tron­age con­ti­nu­ity, rather than the de­ci­sive eco­nomic and in­sti­tu­tional re-gear­ing”.

The fact is that rad­i­cal eco­nomic trans­for­ma­tion goes back to the ini­tial, Free­dom Char­ter-based, com­mit­ment of the ANC for a fun­da­men­tal re­struc­tur­ing of the eco­nomic re­la­tions in favour of the ma­jor­ity (es­pe­cially black peo­ple), with “re-gear­ing” be­ing a ne­ces­sity to en­sure long-term po­lit­i­cal sta­bil­ity in the coun­try.

To ar­gue that Dlamini Zuma will specif­i­cally de­liver an un­palat­able mes­sage to the mar­ket is sim­ply an opin­ion of Free­man­tle and those he rep­re­sents; it is not at all based on mar­ket dy­nam­ics.

In fact the mar­kets would like to max­imise prof­its. Dlamini Zuma’s poli­cies in favour of rad­i­cal eco­nomic trans­for­ma­tion will max­imise profit and ef­forts to­wards poverty al­le­vi­a­tion.

Free­man’s main ar­gu­ments can there­fore be crit­i­cised as fol­lows:

1. “The dam­ag­ing preser­va­tion of the sta­tus quo”: Rad­i­cal eco­nomic trans­for­ma­tion is not the sta­tus quo.

This is a fact Free­man­tle ig­nores. Rad­i­cal eco­nomic trans­for­ma­tion will pre­vent South Africa from slid­ing into po­lit­i­cal in­sta­bil­ity.

In Septem­ber the lat­est sta­tis­tics showed the un­ten­able poverty sit­u­a­tion in the coun­try – facts Free­man­tle ig­nored in his in­ter­pre­ta­tion.

Fur­ther­more Ramaphosa also in­di­cated that the “land ques­tion” must be re­solved. Free­man­tle ig­nored this fact. Some­how Free­man­tle ar­gues that the mar­kets would pre­fer Ramaphosa. This is not based on any sci­en­tific study.

Fur­ther­more, he does not ac­knowl­edge that mar­kets will al­ways pro­tect im­pe­ri­al­is­tic out­comes and will try to post­pone max­imis­ing poverty al­le­vi­a­tion.

The ques­tion should be asked: is this sus­tain­able? How long can that be main­tained be­fore a downslide to po­lit­i­cal in­sta­bil­ity and vi­o­lence?

2. “Pub­lic Sec­tor wage in­creases”: The fact is that Cosatu op­posed Ramaphosa’s views on the na­tional min­i­mum wage. Ramaphosa’s elec­tion will not nec­es­sar­ily ren­der the ne­go­ti­a­tion process with trade unions less com­plex. To ar­gue in this way makes it a bi­ased opin­ion, with the in­ten­tion to pro­mote Ramaphosa as Stan­dard Bank’s pre­ferred can­di­date, not based on any sci­en­tific ar­gu­ment.

3. The ra­tio­nal­i­sa­tion of key state-owned en­ter­prises: Ramaphosa said re­cently that “we can­not just throw away SAA”. The fact is that even if he wins, he will not ra­tio­nalise key SOEs as Free­man­tle indi­cates. Free­man­tle’s “se­lec­tive sale” of state as­sets is more com­plex than in­di­cated and it is not ANC pol­icy. To what ex­tent will Cosatu and the Fed­er­a­tion of Unions of South Africa ac­cept this?

4. Nu­clear: Nu­clear is not a one-year project as nu­clear ex­pert Chris Yel­land in­di­cated; it is a 10- to 12-year project. Who can say with cer­tainty that enough elec­tric­ity will be avail­able in 2030? Is coal and diesel sus­tain­able to gen­er­ate elec­tric­ity? These ar­gu­ments do not form part of the re­port. Thus they must be seen as opin­ions.

Against this back­ground Free­man­tle wrote a re­port based on his own opin­ions and guided by CR17 cam­paign­ers and Stan­dard Bank’s bias in favour of Ramaphosa’s can­di­da­ture.

This re­port was never meant to be an “aca­demic piece” to ob­jec­tively be of ser­vice to Stan­dard Bank clients. It is hardly of any aca­demic or sci­en­tific value.

It is cheap pro­pa­ganda that de­serves to be con­signed to the rub­bish bin.

Stan­dard Bank and its se­nior po­lit­i­cal econ­o­mist should be ashamed of them­selves for in­ter­ven­ing in this man­ner in the in­ter­nal pol­i­tics of the ANC and for try­ing to in­flu­ence the out­come of our na­tional elec­tive con­fer­ence. For­tu­nately they have done it in such an am­a­teur­ish and ham-fisted man­ner that it was from the start doomed to fail dis­mally.

Niehaus is a for­mer mem­ber ANC NEC mem­ber and an Umkhonto we Sizwe vet­eran.

His ar­ti­cles can also be found on his blog, Carl’s Cor­ner: www. carl­

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