South Africa: Old Boss, New Boss
Here’s an incredibly well reported New Republic story from South Africa about how the post-apartheid black ruling elite have treated the poor black masses not much better than the whites who ruled them under apartheid. This excerpt comes after the reader meets Cyril Ramaphosa, who had led the black miners to oppose the apartheid government, but who went on to become a wheeler-dealer under ANC government:
She had a spitting antipathy for the black-liberation establishment—Ramaphosa in particular. “Ramaphosa has shares in the mine now,” she said. “How can he speak for us?”
This critique, which was shared by all the workers I interviewed that night, is a valid one. Income inequality has actually widened since the end of apartheid in 1994. Driving this trend are so-called “black diamonds”—wealthy blacks connected to the black-liberation establishment, whose fortunes have improved incredibly compared with the ordinary people they once represented. Ramaphosa serves as perhaps the most dramatic example. In 1996, after his rival Thabo Mbeki outmaneuvered him in the race to succeed Mandela as the country’s second black president, Ramaphosa decided to enter business. Over the following decade, he became one of South Africa’s richest men, building a $765 million net worth mainly through his Shanduka Group investment arm. “Shanduka means ‘change,’ ” declares his website, “a name befitting to a company founded on the principle of investing in change.” But in fact the Shanduka Group amassed its fortune through investments in august titans of South African business like financial institutions, telecoms, McDonald’s franchises—and mines. Shanduka is a 9 percent shareholder in Lonmin and Ramaphosa is a director of its board. In October, he was discovered to have sent e-mails to Lonmin’s management in the run-up to the Marikana massacre describing the company’s striking miners as “plainly dastardly criminal” and suggesting the police take action against them.
What happened? In truth, there was always an unresolved tension in the ANC’s fight against the world white South Africans had created, including the mines. Was the goal of the liberation struggle to radically dismantle this world—or just to move more freely within it? Over the course of 20 years of ANC rule, the tension has quietly resolved toward the latter aim. When President Thabo Mbeki moved to address blacks’ exclusion from the South African economy, he did so by instituting an affirmative action program called Black Economic Empowerment (BEE) that focused on incorporating blacks into the highest positions at the biggest companies and encouraging huge investment deals with black businesspeople. But by providing an economic ladder to only the most educated and privileged blacks, and by investing in the same businesses—such as mining—that require cheap black labor, BEE only deepened social inequality, though it partially removed its association with skin color. (Ramaphosa has remained a BEE defender.)
And thus a great disconnect has opened up between the black elite and the black poor, not only in their incomes but in their sense of self. Black leaders have substantially occupied former white identities. Ramaphosa has taken up a hobby particularly associated with white South Africans: game ranching. One Friday evening a few months before the Marikana shooting, he showed up at a big-game auction in a colonial-style safari shirt embroidered with the name of his ranch and threw down a near world-record $2 million bid for two buffalos.
The totality of the transformation can be breathtaking. A couple days after I visited Doctor Mulutsi, I flew to a much-hyped poverty and inequality conference co-hosted by the government in Cape Town. After several days of academic presentations, the participants were treated to a gala dinner featuring tables of fine meats, cheeses, and glitter-covered cupcakes; a six-foot-high placard boasted that the spread was sponsored in part by Ramaphosa’s Shanduka Group.
Read the whole thing. The reporter is Eve Fairbanks. South Africa sounds like it may be in for a bad stretch.