Damned if we do! Damned if we don’t!

COSATU is in a no-win situation:
We are damned if we do and we are damned if we don't!

In preparing for this article, I was reminded of a Se-Sotho saying: Ke kgomo ea moshate. Oa e kgapa o molato, oa e tlogela o molato - which refers to a dilemma faced by a villager who comes across the king's cattle grazing in the field. If he drives them to the kraal, he lands himself in trouble since they were meant to be grazing. Yet, he will equally be in trouble if he left them behind since as the king's subject he is expected to bring them home! This is what is known in English, as a case of you are damned if you do and you are damned if you don't!

President Mandela has described the job summit as one of the most significant events since the 1994 democratic election. This event which brings hope to the majority of workers - most of whom are referred to as the working poor - and the unemployed has been labelled a "dangerous idea" that should be "dropped" by a number of editorials in the Financial Mail. While the latest editorial is said to be based on the gap that exist between the COSATU proposals with that of the government and business, the truth is that this has always been the FM's position as was outlined in its June editorial. In fact a careful reading of the editorials reveals the true position of the FM. It is not opposed to a summit of employers and the government. It is opposed to labour's participation in such a summit. I hope it is not a case of: a workers place is behind the machine, and not in policy formulation - long live unilateral decision-making!

As a federation, we make no apologies for putting forward a bold plan necessary for job creation. We believe that solving the unemployment crisis is critical if we are to have a stable society since it is the root cause of poverty, crime and other social ills which poverty breeds. In our country, the root cause of unemployment is a long history of mismanagement of the economy, de-skilling, and under-development as well as an on-going shortage of sustained investment in infrastructure and industry. The presidential job summit can be a useful one to address this situation. However for it to succeed will require bold vision, innovation, political will and support by the majority of South Africans. Properly planned, it can unify the nation around areas such as a commitment to:

  • Training, re-skilling and increasing our economy's productivity with particular emphasis on vulnerable groups, such as, the young, women and the disabled;
  • Creating work opportunities for unskilled people through expanded public works programmes that focuses on land and rural development, provision of basic services, housing, and other infrastructural programmes;
  • Putting in place mechanisms, such as tariff policy reviews, social plan and the bolstering of customs and excise operations;
  • Re-assessing industrial, public sector, procurement and other policies to promote job creation, increased labour intensity and labour standards.
  • Putting in place a comprehensive social security net to offer basic incomes to all unemployed people;
  • Above all the government, labour and business must be willing to make a substantial contribution which is not based on vague promises, but tangible financing mechanisms that are sustainable in the short, medium to long term.

It is for this reason that we believe that the time is ripe for the holding of a summit. The interests of workers - organised and unorganised - and their dependants, the bulk of whom are unemployed, are materially linked to the success of the summit. For workers and their communities it is crucial that the summit succeeds in creating new jobs as well as consolidate and improve the quality of working life in South Africa.

Just as we come to the summit willing to commit workers' money - be they a day's wage, retirement funds and redirecting our investment companies into social and productive investment - so too must the government and business contribute. While it is not for me to judge the seriousness of the government and business proposals, a promise of one billion rands from the government and business respectively is too small compared to what we are asking from workers. It ignores the magnitude of the problem. I call them promises because the business one has yet to be tabled in NEDLAC. This is because there are elements who think of the summit as a "labour market flexibility" summit, and that they do not have to contribute. While I accept the government's good intention I think it will do them a lot of good to not only rely on the demutualisation levy - which may not take place - but also to put money from the fiscus for reconstruction and development.

Those who think of it, as a "labour market flexibility summit" need not come since the Alliance will not waiver from its historic commitment to transform the apartheid labour market through the active promotion of equity and fair labour standards. Also, there is no legitimate economic basis for arguing that more jobs will be created if the labour market is made more "flexible" when factors such as high interest rates, a stunted domestic market and low skills levels place a much greater constraint on economic expansion and job creation.

We must use the summit to launch a bold marshall plan type programme aimed at lifting the economy out of its present rut onto a new job-generating growth path. We must move away from reliance on a minimalist programme which is based on promises that jobs will 'trickle-down' at a later date. If ever there is a right time for the holding of the summit it is now! Now is the time to re-look our policy direction away from simply market friendly but also to be people friendly. Among the reasons for a re-look are the following:

Two years after the adoption of the GEAR strategy, it has hopelessly missed its growth, employment and redistribution targets. While we do not want to turn the summit into a GEAR summit, we believe it will be in the country's interest to re-look the strategy's impact on jobs as well as the provision of basic services by both the private and public sector.

The current global economic crisis - which in reality is a crisis of capitalism - has revealed fundamental weaknesses with the IMF and World Bank's downsizing, trickle-down orthodoxy. This in turn provides us with an opportunity to look at a credible developmentally oriented approach.

There are signals by government of the possibility of bolder policies towards strengthening the state's role in economic development. President Mandela and Deputy President Mbeki's addresses in the Non Aligned Movement and in parliament respectively, show to this possibility. While they have not specifically called for increased taxation, they have both referred favourably to the use of a solidarity tax for funding Germany's unification suggesting that similar measures could be used in promoting the economic unification of the haves and the have not.

In fact in his recent address to the NAM conference, Mbeki reminded delegates that in order to successfully advance the policies of "sustainable development" it should be understood that "the market... has no inherent mechanisms, intrinsic to itself, as a result of whose functioning this objective will be achieved".

It is such an acceptance of the importance of state expenditure in correcting the market's failure to move towards full employment, which remains a central insight of developmental economic policies as contained in the RDP. It also provides the theoretical under-pinning of a Marshall Plan-like expansion in economic activity. It is this that we hope to find consensus through the summit rather than shout slogans as is being suggested in some quarters.

Contrary to the FM's assertion that we have only proposed the use of "tax-payers money", we have proposed a range of financing mechanisms some of which are outlined below. We propose that in addition to the fiscus, tens of billions of rands could be drawn from:

  • The re-introduction of a prescribed asset investment on the retirement industry directed towards job creation and social infrastructure,
  • Converting the public sector pension system from one which aims at being fully funded to a 'pay-as-you-go' system,
  • A re-channeling of the funds of the South African Special Risk Association, and
  • A donation of the value of a day's production by all South African's, including workers.

I hope that in future, the FM will read our proposals before commenting on them in order to send a correct message to the readership. I know that if we had not suggested how funds could be raised to finance our proposed job creation programmes, we would have been criticised for 'not offering any alternative suggestions'. Having tabled proposals, we are criticised for wanting too much. It is for this reason that we take pride in what President Mandela said at the NAM summit: "If the answers we give today are proved wrong and are therefore corrected by time it will not matter. To have erred because we tried will be no great fault. But if we do not try, we will have committed a grave error which neither time nor the people will forgive".