Many South Africans have responded to the news of the $4.3-billion (R73 billion) loan from the International Monetary Fund (IMF) with profound concern that this money will be looted by and through the ANC. 

The ANC, having betrayed the liberation struggle by failing to smash the racist, colonial and white supremacist apartheid capitalist economy and its social relations, has collapsed into a heap of corruption, incompetence, and maladministration. This now threatens its very existence. 

White economic and social power is alive and well in South Africa today, thanks to the ANC right-wing nationalist leadership which has betrayed the masses of our people through their negotiated settlement. 

Today, the Coronavirus has exposed the extreme inequalities, systemic and structural unemployment and mass poverty which is the common lot of the life of millions of Black and African workers.

But, there are deeper problems relating to the IMF loan than the rot in the ANC. The IMF is the mashonisa of global capital and Euro-American imperialism. It, and the World Bank, have devastated economies across the world and stripped governments of their autonomy. This has often led to serious social unrest, civil wars, the collapse of governments or a turn to dictatorships as governments try to control mass discontent. 

The devastation caused by the IMF and its ‘structural adjustment programs’ became a major global issue in the 1970s and 1980s. Countries like Cote D'Ivoire, Senegal, Uganda, Zambia and Zimbabwe were all laid to waste by the IMF. But the damage done by the IMF to countries across the globe is not a thing of the past! IMF advice and thereby lending has been linked to major crises in countries like Mexico (1994), Russia (1998), Brazil (1999), Argentina (2002 and 2018), Greece (2012) and Turkey (2018). In all of these countries, the IMF arrived like a plague of locusts leaving devastation in its wake.

In 1996 South Africa adopted the Growth, Employment and Redistribution: A macroeconomic strategy for South Africa (GEAR) - a self-imposed structural adjustment programme and it devastated the working class. Between 1995 and 2003 the number of unemployed people more than doubled to 8.3-million people. In 2015, 30.4 million South Africans were living below the poverty line. This is a social catastrophe. 

Deepening this neoliberal agenda will be even more devastating in the wake of the more than three million jobs lost in the first month of the government’s imposed Covid-19 lockdown (two million of which were women. The drastic increase in hunger and the collapse of basic service provisions and the health care system in most parts of our country. If the ANC is able to go ahead with a new round of austerity, backed by Mboweni and others, public sector workers will be seriously affected, and the crisis in public health care, education, service provision and safety will rapidly escalate. No doubt the state will escalate repression in order to contain the inevitable protests as the masses of the people see their futures crumbling while the rich get richer. Already we can see that police budgets are escalating while spending on health and education is being reduced.

The public motivation given for the loan by the IMF is dishonest. South Africa does not have a balance of payments crisis. In our view, there are two real reasons for the IMF loan: First, a section of the South African capitalist class together with their imperialist foreign backers and friends have always, post 1994, hankered after IMF tutelage of the South African economy because they do not trust any post 1994 South African government to consistently pursue their neoliberal class interests. Secondly, this loan will strengthen the hand of the neoliberal and corporate faction in the ANC, which is led by Cyril Ramaphosa and his right-hand man, Tito Mboweni. 

Tito Mboweni has become a new Nongqawuse auctioning off our economy. He is the stumbling block whose main mission is to make sure that our people remain economically marginalised and alienated and have no form of public ownership of the South African economy. He is among the key individuals who is committed to making sure that our country’s commanding heights of the economy, our country’s mines and minerals are not owned by the South African public. This is the reason why both the National Treasury and the Reserve Bank have consistently opposed the nationalisation of the Reserve Bank. Instead they have championed a hollow pursuit of inflation targeting, instead of targeting employment, like the Federal Reserve of the USA has done for many years. This inflation targeting has not been neutral; it has been done parallel to the maintenance of high interest rates for the benefit of finance capital. 

Tito Mboweni and his predecessors have sought to stigmatise and condemn, for their selfish reasons, the idea that the state should have a role in the economy. The cheapest way of pursuing this goal has been to make it taboo for the government to capitalise SOEs. What they have been able to do in a sophisticated way which wins public approval is to deliver lucrative deals to the banks by taking their loans to capitalise the SOEs, basically condemning the SOEs to perpetual debt whose huge interest rates are above market rates, constituting an unquestioned plunder of South Africa’s national fiscus. Here, banks are printing money on the back of businesses that are being constrained from trading because their balance sheets are in the red, facing insolvency. This is the very same Tito Mboweni who has now gained the confidence to advise President Cyril Ramaphosa to sell all SOEs, stating that by doing so, all our country’s economic ills will be cured. That is why we see him as our new Nongqawuse, urging us to destroy our collective wealth.

The past announcements by Mboweni that the government was committed to a new round of austerity have been resisted from within and outside of the ANC. But now, as the progressive economist Duma Gqubule has noted, the loan will “provide political cover for South African elites to force through structural reforms in the face of the country’s worst depression in a century and growing domestic and international resistance towards neoliberal economics”.

As Gqubule argues, “The first loan from the mashonisa always looks harmless. But it is never the last one. It sets off a cycle of increasing debt dependency.” And that cycle of dependency is not just about an expanding cycle of debt, it is also about a steady loss of national sovereignty. As Chris Malikane, professor of economics at the University of the Witwatersrand, has argued: “The loan is about policy capture, to tie the country to a neoliberal trajectory. If new people are in charge of the ANC or the government, they will have to continue implementing the IMF programme.” 

The essence of the correct interpretation posited by Professor Malikane runs deep as its real meaning is that the struggle for democracy that has been waged for many decades by the African majority in South Africa has not just been taken from them, but has been handed over to the dictates of the IMF and its twin, the World Bank working alongside rating agencies. Of course, the genesis of this agenda post liberation began with the demobilisation of the masses by institutions and regimes such as NEDLAC and the Labour Relations Act of 1995 which dictated that workers could no longer embark on a strike when a fellow worker was dismissed. The inviolable principle that an injury to one is an injury to all was suffocated and dismissed. The main mission of such institutions was to maintain the status quo by other means. We have defined these institutions as corporatist institutions.

It is for this reason that right-wing commentators, including outright racists like R.W. Johnson, Tito Mboweni’s habitual partner in crime, have long been hoping that South Africa will go to the IMF. Tito Mboweni disguises this agenda under the pretence that it is to save lives during this Covid-19 pandemic. R.W. Johnson’s agenda is clear in his assertion of why he supports South Africa taking an IMF loan, as the accompanying conditions for SA to get the loan will advance what he and Tito Mboweni have consistently advocated for in the interests of the IMF. They call for the improvement of the education system; liberalising labour laws and regulations to make it easier for employers to hire and fire people and to import skills; cutting the "swollen" civil service wage bill; and addressing the loss of money in SOEs. 

Let us be upfront with both Tito Mboweni and R.W. Johnson. The Freedom Charter was scientific when it said the doors of learning and culture shall be open to all, meaning, education must be free and compulsory. It cannot be the domain of the dominant exploiting class in society. 

Mboweni and Johnson are confused when it comes to their understanding of the labour market in South Africa. Both the World Bank and Oxfam will confirm that South Africa has a flexible labour market where workers are the victims of an apartheid wage structure which continues to date. We have no choice when it comes to the opportunistic agenda of this particular elite and all its cronies in the realm of politics, business, NGOs and civil society who, led by Tito Mboweni and Minister of Public Services Senzo Mchunu, want to attack the workers’ wage bill. 

Our message to them is that workers in the public service must be paid their earned wage increase. And to the extent that they have fabricated an illusionary consensus to attack workers’ wages in the form of an attack on the public services wage bill, they must be told to look for the nearest cliff and jump. It is these workers in the public service, like those vulnerable workers in the private sector, who take care of the wellbeing of the rest of society. They are on the frontlines of the messy and inhumane working conditions created by failed neoliberal policies. 

Jeremy Corbyn, reflecting on the shameful state of affairs where vulnerable workers risk their lives, said the following:

We can all now see that the jobs that are never celebrated are absolutely essential to keep our society going. This of the refuse workers, the supermarket shelf-stackers, the delivery drivers, the cleaners.

Those grades of work are often dismissed as ‘low-skilled’. Low-skilled. But I ask them this question, who are we least able to do without in a crisis, the refuse collector or the billionaire hedge fund manager? Who is actually doing more for our society at this very moment?

Let’s value people for their contribution they make. Respect the skill of the cleaner, the refuse worker, the postman delivery worker, all of those. Let’s have respect for those that actually are part of the glue of our society.

This virus knows no national boundaries, and neither should our capacity for compassion and care for our fellow human beings know any national boundaries either. The internationalism of the doctors from Cuba who have gone to fight the virus in Italy is inspirational. 

The old trade union slogan goes: An injury to one is an injury to all, united we stand divided we fall.

Whilst we understand the challenges of poor performing SOEs and their over reliance on state funding for survival, we are concerned with the dominant notion of some of the government ministers such as Tito Mboweni, that the cure to the ills of the South African economy lies in the sweeping sale of SOEs. We reject this view as it presents South Africa with a new Nongqawuse who told the Xhosa nation to sell all their livestock and burn their crops as the dead will arise to drive out the colonial oppressors and unlock prosperity and wealth. Of course the dead did not arise, people starved and the colonial armies tightened their grip on the land and its people.

Mboweni is the new Nongqawuse. But this time the dead will arise, as we stand, in the spirit of the previous generations who have struggled for freedom, against this attempt to surrender our national sovereignty to the forces of imperialism.

We want to point out that there is nothing wrong in a company being state owned. What matters is the mind of the shareholder, how the shareholder makes decisions, what calibre of boards it appoints and what strategic investment decisions it supports. South Africa’s government has not covered itself in glory when it comes to management  of the SOEs. The Fortune 500 list has over 121 SOEs on its list, the majority of which are Chinese SOEs. This is clear proof that public or private ownership of SOEs has nothing to do with their performance. What matters is the mind of the shareholder.

It is also important that the ministers who are making big decisions which have a massive impact on the future economic outlook of the country are in their twilight age. They are making decisions with impacts that they will not live to see.  They are creating a burden for the youth and future generations to inherit. Where is good stewardship in this regard? As leaders we are trustees for future generations. Our role is to ensure that we leave the economy in a better position than when we found it and held the reigns. Selling off state assets in the fire sale which Tito advocates is like auctioning family assets so that the children start with no economic base. What kind of a trusteeship is this that we are witnessing?

We can see through the agenda of the forces, led by Tito Mboweni, who are collaborating to surrender our national autonomy to the IMF. Whilst this statement is dedicated to the absolute rejection of the new loan it is also important to state that this is not just a matter of the IMF voluntarily offering a loan to South Africa. Tito Mboweni is actively furthering the aims of the IMF and rating agencies, and it is him who applied for this loan. We dare him to challenge us and say that this is false.

Now that the hold of white supremacists on the South African state has been broken, they want to give up our autonomy to the IMF so that it becomes impossible to democratise the management of the economy, build workers’ control and achieve real economic redistribution. 

We are now facing the first step towards institutionalising and deepening state capture by international capital, post 1994. The initial “international state capture” was the loan Mandela, Thabo Mbeki and their ANC friends contracted from the IMF, even before they were in government. Ronnie Kasrils, writing in the introduction to the Jacana edition of his book “Armed and Dangerous”, says this about that IMF loan: “We took an IMF loan on the eve of our first democratic election and had already imperceptibly succumbed to the guile and subtle threats of the corporate world which had been chipping away at our revolutionary resolve for some years. That loan, with strings attached, that precluded a radical economic agenda, was considered a necessary evil at the time, as were the concessions to keep negotiations on track and take delivery of the promised land to the people”. That loan made GEAR, the neoliberal macroeconomic policy the ANC has pursued since 1996, not only possible, but inevitable. Today with the threat of another possible assault on the working class by the South African racist, colonial and white supremacist economy and society, another IMF loan has become inevitable, and so the ANC again, contracts the IMF to keep the masses in perpetual bondage to racist, classed and untransformed global and local capital where poverty is their order of the day.

The Socialist Revolutionary Workers’ Party (SRWP), as a proud vanguard party formed by the toilers of the earth, the working class, and NUMSA, the industrial proletariat, has a proud record of opposing the racist, white supremacist pre and post-apartheid states, and the corruption that has riddled the ANC government, and become most pronounced during the Jacob Zuma period. But unlike Save South Africa, and other liberal civil society formations, who think that we can give capitalism a human face, our united and collective position is that we must smash capitalism as the system which is the source of humanity’s miseries on the global stage. We completely reject any idea that the solution to the continuing corrupt capitalist, racist, colonial and patriarchal system lies in deepening the domination by either domestic or international capital. For us, the solution to the rotten pre and post-apartheid states is the wrestling of economic power from the capitalists by the working class and impoverished masses. The solution is socialism.

It is now vital that all progressive formations – including  shack dwellers, all workers (employed and unemployed) and the few progressive intellectuals willing to engage the formations of the working class and the impoverished masses on the basis of mutual respect, and who accept that the working class is the only class capable of leading the revolution to its logical conclusion – push as hard as we can to defeat both the corrupt and neoliberal ANC and the right-wing, capitalist, political apologists in the country, and to demand that South Africa shall not pay back the fake IMF loan: it must be declared an odious loan. We call on all political parties to insist on a default on the IMF loan and to make it clear that we will defend our economic sovereignty. We must insist on the removal of Mboweni from his portfolio and refuse to ever have anything to do with both the IMF, and its partner in crime, the World Bank.

There is no alternative to socialism!

Millions of people participated in the struggle for the end of the apartheid - the racist, colonial, white supremacist state and society - in order to build a new society. As we have seen in the past 26 years, the IMF made sure even before the first elections that we were saddled with a loan that precluded any radical transformation which would have led to the  

emancipation of the oppressed and exploited. To now deepen and entrench our subordination to global corporates and the IMF would be a political crime of the highest order. We serve notice that we will resist, and that we will work to build the widest and most effective coalition possible to oppose the IMF, and the neoliberal and corrupt ANC.

Above all else, now it is time to unite the working class under the banner of the SRWP to struggle and wrestle political power from both local and foreign capitalists, for a socialist South Africa and socialist World. The alternative is more misery and brutal deaths for the working class. That alternative is unacceptable and therefore the choice before us is socialism or barbarism.

Issued by Irvin Jim, National Chair  Socialist Revolutionary Workers Party