Economist, Critic of Neoliberal Capitalism, and a Veteran in the Struggle for Justice

Prof. Drucilla Cornell, Rutgers University 2013, friend

I have been honored to know Sampie Terreblanche since 2007. He has been a supporter of the uBuntu Project from that time, and honored us with his presence by speaking in the series of seminars I ran under the Project’s name at the University of Cape Town. I was a National Research Foundation professor at that time, and living in South Africa. In 2008, I joined with prof. Terreblanche and prof. Mahmoud Mamdani in their call for a Justice and Reconciliation Commission after what were labeled the “ethnocentric riots” in the townships throughout South Africa. We argued that it was dire poverty that was at the basis of these uprisings in the townships. Mamdani and Terreblanche first made their own call for a Justice and Reconciliation Commission in 1998. To understand the reasons behind their insistence that the Truth and Reconciliation Commission was not enough to even begin to solve the massive economic problems facing South Africa, we need to remind ourselves of prof. Terreblanche’s foundational book, A History of Inequality in South Africa, 1652-2002.

It is impossible to even begin the summarize the rich argument in that brilliant book, but for now I would like to emphasize two arguments, before turning to this new book, Lost in Transformation. First, prof. Terreblanche’s historical account is given from an explicit normative perspective. History is told as an account of unfree black labor. As I argued in my book written with Kenneth Michael Panfilio, Symbolic Forms for a New Humanity, this normative perspective has an implicit telos in it, which is that the normative ideal implied is that of free black labor. This implies that we attempt to give an account of what free black labor might look like. In a deep sense, we can understand prof. Terreblanche’s call for a Justice and Reconciliation Commission to be part of an effort to begin to understand what the normative ideal of free black labor might look like, and what kind of economic organization could undo the history of unfree black labor which he so painstakingly describes. This is an aspect of Terreblanche’s work that might well go unnoticed. His work as an advocate for a Justice and Reconciliation Commission and his critique of apartheid as part of a brutal and long history that long preceded it means that we cannot simply see the wrong of apartheid as political exclusion. Therefore that wrong cannot simply be corrected by political inclusion in basic civil and political rights such as the right to vote. If there is then to be a transformation of South Africa into an ethically viable new way of human beings living together in the “new nation,” it must involve the undoing of the systematic conditions of subordination inextricably connected to unfree black labor. Thus for Terreblanche, unlike for some U.S. political theorists, theory and practice are integrally connected. The role of theory is indeed to help us highlight the direction our political practice must take, and indeed, critique demands nothing less of us than that we pursue a practical agenda consistent with our critique.

Long before his call for the Justice and Reconciliation Commission in 1998, prof. Terreblanche was involved in the South African Delegation in 1987, which as he describes them were “talks about talks.” These were informal discussions with the African National Congress about whether or not a negotiated settlement was possible. Apart from Terreblanche, the Afrikaner academics included professors Willie Esterhuizen, Willem de Klerk, and Marinus Wiechers; the ANC leaders included Thabo Mbeki, Jacob Zuma, and Aziz Pahad. Terreblanche, however, does not tell about his own involvement to pat himself on the back. Instead, he tells the story of how the summits between Reagan and Gorbachev in 1986 played a major role in pushing the ANC to feel they had no other choice but to engage in negotiations, because Gorbachev made it clear that the Soviet Union would now strive for negotiated and diplomatic solutions to conflicts in countries such as South Africa, Palestine, Northern Ireland, Iran, and North Korea (just to name a few), whereas the Soviet Union had previously supported armed struggles. So for Terreblanche, these “talks about talks” were not simply set up by the ANC and his own committee. There were players behind the scene that were pushing for a particular kind of settlement, and they continue to play a major role, The two major players were the United States and the United Kingdom.

As Terreblanche emphasizes throughout both books, Britain has always been politically dominant in South Africa, long after it let South Africa go as a colony. As a result, in 1986, Margaret Thatcher, who along with Ronald Reagan had refused to impose economic sanctions on South Africa, changed her position, and first held meetings with P.W. Botha and later with F.W. De Klerk as to what they should do to achieve a negotiated settlement with the ANC. For Terreblanche, the role of the U.S. government and its allies in this settlement is part of the devastating story of the ANC’s capitulation to being what he describes as a satellite of the neoliberal empire of the United States. The first major point that Terreblanche makes, then, is that there was an elite compromise that was to a large degree controlled by U.S. and British dominated interests, and not by the economic interests of the people of South Africa. The second major point in both books is that capitalism is always what Terreblanche calls a “dual politico-economic system.” Key for Terreblanche is that any nation state must be strong enough to control the inherent abuses of capitalism. I quote Terreblanche in full, because I will raise questions as to whether such a thing as democratic capitalism is possible at the end of this essay:

Democratic capitalism, as a dual politico-economic system, only reached maturity after a long ‘gestation’ period. The democratic and the capitalist ‘sides’ of this politico-economic system are contradictory: while democracy emphasises joint interests, equality and common loyalties, capitalism is based on self-seeking inequality and conflicting individual and group interests. The legal system that protects both democracy and capitalism is based on the principle of equality before the law, but maintains inequalities in the distribution of property rights and of opportunities for the capitalist system. The ‘logic’ of capitalism – given the unequal freedoms and unequal rights upon which it is based – thus goes against the grain of the ‘logic’ of democracy (Terreblanche 2012).

In A History of Inequality in South Africa, Terreblanche argued that the transformation of South Africa, which began with the election of Nelson Mandela in 1994, after fraught negotiations, was incomplete, although he does not want to deny the accomplishments of the negotiated settlement. South Africa has what can easily be considered the most progressive constitution in the world, one that promises what Emeritus Justice Laurie Ackermann has called a “substantive revolution.” And what is a substantive revolution? It is a revolution that does not completely overthrow the existing government, but at the same time transforms all of its ethical relationships. Terreblanche argues that the capitulation to neoliberal capitalism in the United States form was decided behind closed doors. Economics, in other words, was not subject to constitutional negotiations, and indeed, he speculates that the constitutional negotiations themselves were held in check in part by the ANC’s request for a loan from the International Monetary Fund, which has always imposed strict conditions that would make it impossible for South Africa to engage in a thorough redistribution of wealth. Therefore, the Justice and Reconciliation Commission was absolutely necessary to reconsider these secret deals and to raise the questions that needed to be asked: What kind of economic system must be adopted to undo 350 years of unfree black labor, and what kinds of measures must be undertaken to undermine, if not undo, the vast inequalities of wealth that continue to exist in South Africa?

But in his new book, Terreblanche develops this theme even more powerfully, in that he argues that there has never been a politico-economic system in South Africa in which the political side could restrain the capitalist side in the name of the well-being of society. He lists four periods. First, the period of the Dutch East Indian Company, which ruled from 1652 to 1795. Simply put, the government was the Dutch East Indian Company. Next, there was British colonialism, in which again the British colonial authorities were completely subordinated to the capitalist British Empire. Third and fourth is the domination of the MEC, which according to Terreblanche continues to dominate South African politics to this day, with a handful of other corporations. The ANC inherits this long history of absolute subordination of what Terreblanche calls the political side of democratic capitalism to the interests of the capitalist class. The history of the MEC is described in great detail, with its bloody suppression of black workers, which as Terreblanche points out continues through the recent aggression against the miners’ strike. Although the National Party gained political power in 1948, it was only allowed to control certain aspects of political life, i.e. the promotion of discriminatory legislation in favor of Afrikaners and against Africans. But the National Party ultimately allowed itself to be run by the interests of the MEC.

When the National Party seemed to become a stumbling block to what capitalism saw as its interests, some of the major corporations in South Africa actually supported people like Terreblanche, who were seeking a negotiated settlement. Indeed, Terreblanche remarks that this was one of the few times in his life, if not the only time, when he was a favorite of the British corporations in South Africa:

At these meetings we were treated as if we were celebreties. Shell organised and financed a large anti-apartheid conference of white businessmen, academics and prominent black leaders at White Plains near New York in September 1987. Zach de Beer played an important role at the conference in building bridges between members of the PFP and members of the ‘independent’ groups (Terreblanche 2012)

In 1989, the Progressive Federal Party alligned itself with other independent groups to form the Democratic Party. Terreblanche became the economic advisor for the Democratic Party and a member of the executive council of that party. The Democratic Party took the position that any democratic election would have to be based on the principle of one person, one vote, which would obviously include the entirety of the black population, at least at some point. The National Party fought hard against the Democratic Party, arguing against their one person, one vote “propaganda.” Terreblanche later worried that perhaps part of the onslaught of the National Party against the position of one person, one vote was that they were under pressure from U.S. and British-led capitalist groups, who were busy trying to manipulate South African politics. Therefore, they were supposed to slow down constitutional negotiations.

Nelson Mandela famously walked out of prison with his fists in the air and a commitment to socialism. But his commitment obviously soon wavered. From 1990 onward, Mandela and Harry Oppenheimer of the MEC met regularly. According to Terreblanche, a number of corporations joined in these secret negotiations, which reached a climax in 1993. By 1993, South Africa was governed by the Transitional Executive Council, which had eight members of the National Party and eight members of the ANC. It was the Transitional Executive Council that agreed to the IMF loan, which basically signed South Africa on to the United States’ neoliberal agenda. This compromise not only left out the majority of the people, but also fundamentally undermined the possiblity of a truly new South Africa. Terreblanche’s fundamental argument, backed up with careful statistical evidence, is that things have actually gotten worse for the poor in the new South Africa. But he makes a point that is oftentimes ignored, and which informed not only his call for a Justice and Reconciliation Commission, but also his proposal for a wealth tax on the rich. His analysis is that there is a relation between the rich and the poor, which is always part of a system of impoverishment under neoliberal capitalism. It is that system that must be undone. To quote Terreblanche:

The rich and the poor are two sides of the same systemic coin. Nothing explains this close relationship better than the situation in South Africa during the first seventy years of the twentieth century when whites constituted 20 per cent of the total population, while receiving more than 70 per cent of the total income. Africans constituted almost 70 per cent of the total population, but constantly received less than 20 per cent of the total income – a skewed situation that can be ascribed to the politico-economic system of white political dominance and racial capitalism/corporatism in place in South Africa during that period. In this system both capitalism/corporatism and white political dominance enriched whites undeservedly and impoverished blacks undeservedly (Terreblanche 2012).

In the conclusion of his new book, Terreblanche critiques the National Development Commission’s stated goals for 2030 in South Africa, which would include, among other things, lowering the unemployment rate to six percent. Of course, Terreblanche thinks the goals are laudatory. But the problem is that there is no understanding of the system of neoliberal capitalism and the relationship between the rich and the poor in South Africa, and therefore there is no effective plan to reach those goals. Terreblanche predicts that things will get increasingly worse for the black majority, and the only remaining solution, given that the ANC has turned a blind eye to what the real problem is, would be a revolutionary transformation. In addition to an economic critique of the ANC’s economic policies, Terreblanche offers us a detailed account of their failure to rule as a people’s government. I share some of that critique. But I want to raise several questions to Terreblanche, given his own analysis of what he calls “democratic capitalism.”

In Lost in Transformation, Terreblanche favorably quotes Fernand Braudel, who argues that capitalism is only truly triumphant when capitalists are so closely identified with the state that they become the state. Indeed, he then goes on to approvingly cite Giovanni Arrighi, who actually argues that China is not a capitalist state because the capitalist class and it alone has not become the state. If this is indeed a definition of capitalism, that the capitalist class becomes totally identified with the state—and certainly on one reading of Marx he would have agreed—then can there ever be anything like democratic capitalism? Would we not instead have to argue that democratic socialism is the only true alternative to the dominance of the neoliberal U.S. empire? Of course none of us truly know what democratic socialism would entail. But would it not begin with at least raising all the issues of the economy to be democratically discussed? Was not that the point of the Justice and Reconciliation Commission?

My next question to Terreblanche has to do with what he sees as the ANC’s one-sided mobilization of Africanization to create a black, very small elite. Here I want to bring Frantz Fanon into the argument. Fanon distinguished between two kinds of nationalism in Wretched of the Earth (2004). The first kind of nationalism was that of the bourgeoisie, which separated a political solution to neocolonialism from the economic solution, with the hope that they might join the ruling class, even as “second-class citizens.” The second form of nationalism, which for Fanon was always transnational, was a people’s nationalism, which claimed democratic control over all aspects of life, including the economy. The mobilization of indigenous ideals in this people’s nationalism is a complex and difficult question. Terreblanche himself has advocated in uBuntu Project meetings that uBuntu could be used even at the level of the Constitutional Court to challenge certain neoliberal assumptions about who has the right to what, particularly given the distribution of wealth in South Africa. One way of thinking about uBuntu is not simply that it is an indigenous or black value, although it of course finds its roots there, but that it has a universal appeal precisely because it ultimately is an ethic of our being human together, not being African together. If this is the case, can values like uBuntu play a role in the on-the-ground struggles that are already beginning to challenge the ANC’s hegemony as the former party of liberation? The Shack Dwellers, for instance, have coined the phrase “revolutionary uBuntu,” and this phrase was picked up by the miners in their recent strike. Therefore, perhaps the problem is less with Africanization than with what Fanon would have called the capitulation of a national bourgeoisie to the demands of capitalism. I leave Terreblanche with these questions for further discussion.

I want to conclude by thanking him for always being willing to continue the discussion, and for his insistence that even while we are offering searing, perhaps devastating critiques of the failure of transformation, we cannot sit on the sidelines as we offer these critiques. We also have to offer and fight for solutions. It is important to remember here that part of the reason the elite compromise had to be behind closed doors is that there is absolutely no way that the black majority would have accepted that compromise. The ANC began its struggle in 1912. The ANC has no doubt tried to demobilize its members, but I would argue that they have failed to do so and will continue to fail to do so. So perhaps I should end this essay by once again joining Terreblanche’s call for a Justice and Reconciliation Commission, where questions of economic justice could finally be addressed. I thank him for his courage and for being an example to all academics for what our responsibility is in an unjust world.