Two big issues are now front and centre in our politics, and both point to the divided and weakened state of the ANC. Neither issue can be resolved without a public and humiliating back-down by the ANC.
The first issue is the extreme difficulty the ANC is facing in passing a budget. For the first time since 1994, the ANC cannot get a budget passed without going down on its hands and knees to other parties. The second issue is the crisis in our relations with the US. There is no sign of any resolution which could save our preferential trade access to the US market through the Africa Growth and Opportunity Act (AGOA).
What stands out about both issues is that they are both the results of own goals on the part of the ANC. But the ANC, full of pride yet divided, is dead scared of backing down. It is also dead scared of backing down and embarking on a full-scale reform programme that could boost the economy.
Had the ANC fully consulted with its government of national unity partners on the budget, it would not have come up with the idea of a VAT increase. The ANC must be tone-deaf even to consider a VAT increase after the surge in post-Covid inflation, even though the Finance Minister, Enoch Godongwana, came up with additional exemptions from the tax.
Had the ANC better consulted its GNU partners and listened, it would have known full well that its initial proposal for a two-percentage-point increase in VAT would not fly. Coming up with a half-percentage point increase in VAT for this year and the next year still demonstrated that they were tone deaf. This is the sort of own goal that could really hurt them at next year’s local government elections.
Delays in passing a Budget and any concessions the ANC makes to other parties inside or outside the GNU will put the party’s weakness on public display. The DA says no to any tax increase and wants Expropriation without Compensation (EWC) scrapped, while the uMkhonto we Sizwe Party and the Economic Freedom Fighters probably want to see the ANC stew.
And if no deal can be reached, the other parties, seeing ANC weakness, just might go in for the kill with a vote of no confidence in the GNU. That could trigger another attempt to form a GNU which could yield concessions from the ANC and might result in fresh elections at a time when the ANC is at an all-time low in recent polls.
Although it’s a domestic issue, the scrapping of EWC could help ease relations with the US. President Donald Trump claimed that the government was seizing land in SA. That is not the case yet, but the government does have the power to seize land without compensation. For all the advantages to the country of scrapping expropriation without compensation, the ANC regards this policy as core to its rhetoric and project.
Its attitude to imperialism and hegemony is also core to its rhetoric and project – a not too hidden reference to the US. Relations with the US have been on the path to crisis for a decade or more. Washington’s aid and the extension of trade preferences have been regarded by the ANC with an attitude of entitlement. South Africa votes with Russia, Cuba, Venezuela and Iran at the UN, and yet accepts US aid. Naval manoeuvres with the Russians and Chinese, and the attempt to have the International Court of Justice (ICJ) declare Israel guilty of genocide were the final moves in our scoring this own goal.
And then Ebrahim Rasool, our Ambassador to the US who was kicked out of the country, selfishly thought he could call the Trump Administration white “supremacist” without consequences.
Rasool’s replacement as Ambassador cannot end the diplomatic crisis with the US. It is a distraction to think this can be the solution, when the solution lies firmly with an ANC change of mind and back-down.
President Cyril Ramaphosa has appealed for calm from the ANC on the stand-off with the US, but is being blatantly defied at every turn. This indicates a campaign to undermine him. Last week Ramaphosa appealed for the cadres “to act responsibly and avoid activities that could be perceived as provocative or further damage our delicate relationship with the United States.”
Yet, upon his return over the weekend, Rasool gave a defiant and rousing speech at Cape Town International Airport, saying that SA wants good relations with the US. “But we cannot do this by allowing the US to choose who must be our friends and who must be our enemies.”
Snuki Zikalala, who rose to national prominence as the SABC head of news and is now the President of the ANC Veterans’ League, issued a Human Rights Day statement that was equally defiant of Ramaphosa.
“As the ANC, our strategic position, both politically and diplomatically, should be to oppose, call out, and build alliances against the rising reactionary, imperialist moves of Trump and his allies. It is naive to believe that you can rebuild relations with an implacable enemy,” Zikalala wrote, reported News24.
These strident words are a sign that Ramaphosa is a lame duck and not in full control of the party, making it difficult for him to improve relations with the US. With Ramaphosa’s second term drawing to a close, factions are jockeying for position in the upcoming race for the next leader of the party. It is a sign of a party in decline and chaos, taking its eye off what the voters really want.
But the party’s insistence that it won’t back down does not ensure election success. The VAT rise will be seen as an attack on the poor, and a head-on collision with the US will not win an election. In last year’s election, the ANC attempted to gain support in the Western Cape for its ICJ case against Israel. It did not work. The party that really gained was Gayton McKenzie’s Patriotic Alliance, which is staunchly pro-Israel. Voters are interested in jobs and other pocket-book issues.
SA has insisted that it will not withdraw the case, which will make it impossible to move forward with the US. And there are no signs that we will give up on our good friends whom the US does not like, and no signs of a reversal on the Expropriation Act.
Rasool and Zikalala are prepared to pay the price of South Africa forgoing preferential tariff access for a range of goods to the US market under AGOA. It might not be Ramaphosa’s choice, but how will he explain to workers in the motor and other industries why they have lost their jobs when the US ends AGOA?
The views of the writer are not necessarily the views of the Daily Friend or the IRR.
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