Tackling South Africa’s Problems

I think South Africans are very hard on themselves,” Archbishop Desmond Tutu replied when I asked him — the single most truly non-racial person I know — whether he thought South Africans were making progress towards becoming a rainbow nation.

He had just returned from a church conference in Germany, where he was shocked by the attitudes that still separate the western and eastern sectors of that country.

“Here are people who are of the same ethnic group, who speak the same language — and yet, they are still very far from being reconciled,” the archbishop said.

“And here we are, with our many races and ethnic groups and our 11 official languages. I think it’s amazing that we have the level of stability that we have. Look at Northern Ireland, look at Yugoslavia. We could so easily have gone that way.”

But we should not have unrealistic expectations, Tutu warns. It will take time to build a sense of national unity across such a wide spectrum of diversity — with such a history of conflict.

But he is encouraged by his experiences as head of the Truth and Reconciliation Commission, where he witnessed many remarkable acts of personal forgiveness. “I think we are going to make it,” he said. “The world needs a South Africa that has succeeded.”

What is the measure of success? It is a matter of inculcating a culture of mutual respect and tolerance.

The differences of race, color, culture, of the religious and the secular, of different perspectives and worldviews will all remain.

But as a society, we must learn to contain them within a broad entente and hopefully infuse all with a transcendent sense of common nationhood.

To mix the metaphors, the rainbow nation must be a mosaic society — not a melting pot. Like Desmond Tutu, I believe South Africans are learning that. We have made considerable progress along the rocky road from institutionalized racism to mutual tolerance.

We have made progress in other ways, too. A decade ago, we were not only racially divided and locked in social conflict.

We were also in a fiscal mess. We were politically and economically, even psychologically, isolated in a globalizing world, inflation and interest rates were sky-high, our businesses were inefficient and uncompetitive — hiding behind high protective tariffs — and economic growth had been in decline for years.

Today, all that has changed. Our apartheid society has become integrated across the board, from schools to workplaces to boardrooms — and even bedrooms.

We have a functioning multi-party democracy with regular free, fair and peaceful elections. It is underpinned by the world’s most progressive constitution and protected by perhaps the world’s finest panel of judges in the Constitutional Court.

Economically, too, South Africa is transformed. The economy has averaged 3% growth a year over that decade.

Growth is projected to average 3.6% from 2003 to 2006. It has stayed above the international average through the post-9/11 global recession — and it has shown the least degree of volatility of all emerging economies since 1994. It is in far better shape than the Latin American giants of Brazil and Argentina.

But daunting problems remain. Despite the improvements, the economy is still too sluggish to get the country on the high road to real development.

Unemployment is high, the skills level is low, there is a huge wealth gap, crime persists, foreign investment reaches only a meager 1% of GDP — and the AIDS pandemic is inflicting great tragedy on the population.

Although the wars in Angola and the Democratic Republic of Congo are ending, Zimbabwe continues to blight the region so that the neighborhood remains bad. How to tackle these problems is the challenge that faces us in the decade ahead.

South Africa’s problems are dialectical. They interact with each other and feed off one another. Each of the critical issues has powerful implications for the others.

Poor education leads to a low skills level, which deters investment, which slows growth, which aggravates unemployment, which increases the crime rate, which deters investment — and so on.

Somehow, there must be a dynamic intervention in that process to reverse its cycle. An improved educational system would do it, and much attention is being given to that. But that is a slow road.

It takes 21 years and nine months to produce a new skilled worker. And first, you must produce a new corps of skilled teachers in the face of competition for their skills from much better paying occupations. Something faster is needed.

I think South Africa needs to modify its neo-liberal approach. It is not working for us, and it has not worked for a number of Latin American and East European countries, which have had slow and volatile growth.

The lesson is that one-size-fits-all formulae are no good — whether they emanate from Washington or pre-perestroika Moscow.

Economic jackets, strait or otherwise, must be tailored to fit individual circumstances — as the more successful examples of India, China and Vietnam have shown.

This does not mean South Africa should abandon its Growth, Employment and Redistribution (GEAR) policy or undertake a radical change of course.

But some modifications are needed to meet our special circumstances.

The crux of the problem is that South Africa has a double-decker economy — its first-world sector and its third-world sector. And what is working for those on the upper deck of this economic bus is not working for those on the lower deck. So unemployment is increasing and the wealth gap is widening.

It is a question of skills. The new globalized economy places a premium on skills. Those at the top of the bus have skills, while those on the lower deck do not. Which means that while those on the upper deck are prospering, growing numbers of those down below are unemployed — and rapidly becoming unemployable.

And if nothing is done about it, South Africa faces the socially dangerous prospect of this unemployment being repeated every generation. The children of the unemployed will themselves be unemployable.

There is a further troubling feature to this double-decker bus. Those on the top deck are a multi-racial group.

It used to be a whites-only deck, but now it is integrated. They are all getting on pretty well, working together, making money together, their kids going to the same schools and universities. It is a rainbow deck.

But those down below are nearly all black, just the odd pinched face of a poor white here and there. And another thing: There is no stairway from the lower deck to the upper one. If you are unskilled, you cannot climb up to the top of the bus.

A single neo-liberal macroeconomic policy, which is what South Africa has, is insufficient to deal with this dual economy. It may be good for the skilled sector, but not for the unskilled. What is needed is a two-pronged strategy to cater to the different needs of both.

The developed sector must be encouraged and energized to build on the good start it has made. It is this sector that will attract the foreign investors.

But the unskilled sector, which is far larger, needs a different set of strategies — not only for humanitarian reasons, though those are important enough.

The test remains to draw them into the economy from which they are now excluded. Only then can they begin to contribute their huge numbers to South Africa’s growth — and also build a stairway to the top.

What South Africa needs, I believe, is a state-driven public works program on the scale of Franklin D. Roosevelt’s New Deal, which would build vital infrastructure that is big enough to capture the public imagination and energize the nation.

This New Deal project could be combined with on-the-job skills training to help the workers find other jobs afterwards and uplift the general skills level of the country.

It would reestablish the dignity and satisfaction of work for a large sector of the population now afflicted by the demoralization and other harmful psychological effects of unemployment.

But the lower deck also needs financial help to improve themselves. This includes recognizing the double value of the new South Africa’s massive provision of housing for the black community.

It also includes the need for a major program to asses and grant legal title for the land and shacks occupied by millions living in informal settlements.

The South African government’s macro-economic policies are indeed praiseworthy and the top of the bus is doing well. But there is no trickle-down effect.

We need strategies for the lower deck and if those masses can be better mobilized, I believe there will in fact be a trickle-up effect that will boost the entire economy.

Adapted from “Beyond the Miracle: Inside the New South Africa” by Allister Sparks. Copyright