Having access to previously inaccessible areas brings opportunities as well as unintended consequences. Imagine at a private school where there are bursaries for previously disadvantaged kids (which is the politically correct term for poor black people in some social circles), in order to widen opportunities for them through a better education.

Having access to previously inaccessible areas brings opportunities as well as unintended consequences. Imagine at a private school where there are bursaries for previously disadvantaged kids (which is the politically correct term for poor black people in some social circles), in order to widen opportunities for them through a better education.

The benefit for the school is that it is seen to be transforming by having more black faces around. What is the emotional impact of these opportunities on those black kids?

Imagine in the corporate world where the broad-based black economic empowerment (BEE) rules require companies to widen their supplier base to include black-owned companies in their procurement opportunities. The question is how these companies’ access programmes affect the black suppliers? The same question applies to black partners in auditing and law firms.

There is a risk of a stigma attached to being a bursary student at school. This is because other pupils don’t see these bursary kids as having the same status despite the fact that to get the bursary in the first place there needs to be a high level of talent and competence. There is a tacit discrimination against pupils who are on the financial aid type bursaries.

For example, if there is a party over the weekend, the non-bursaried kids will get the invite, while it is assumed that the bursary kid can’t afford to get transport at night to get there and back home. The other alternative available would be for the bursary kid to sleep over at a friend’s place, which has dynamics of its own in terms of accentuating the differences in social status between the two.

For kids with a low self-esteem receiving a bursary would create a phenomenon of “negative dignity”. However, a different mindset can prevail where the same situation can be viewed from a positive developmental view. I went to a private school from Standard 8 (Grade 10), which was a financial stretch for my parents. I worked hard to make sure that I got the best academic results and by the end of that initial year I was able to get a 50 percent bursary, which helped ease the financial burden on my parents.

The stigma of being a bursary kid started thereafter, but I really didn’t care because I wanted to learn and I was determined to be successful no matter what. I absorbed all the different lifestyles that I came across, which helped craft the life that I wanted. So the negative taunts of being a bursary student never had the effect of killing my drive but helped me transcend the limitations that were put in my way. The result is that I garnered more respect from the taunting kids at the end of the day without me trying to get their approval.

In the corporate world, the same thing is happening when the stigma is created with black suppliers who were fast-tracked in the procurement arena. I guess there is a similar stigma in the professional services like law and accounting, where some people are fast-tracked to partnership level to have other people tell them: “You got there because you are black and not because of merit.”

This is often done to question their credibility and suitability for the job. These types of comments can have a negative impact on the identity of these fast-tracked individuals to the point of them quitting and trying to prove themselves to their critics. This creates negative dignity for those with low esteem and who are going through an identity crisis.

This view is so pervasive that some young black people say that affirmative action and access programmes must be abolished and have only merit-based requirements applied to opportunities. I guess young black people support the scrapping of affirmative action and broad-based BEE programmes but they never experienced the cold face of exclusion, which weakens their credibility in making these calls.

There is nothing to be ashamed of in getting fast-tracked to a particular status, as long as there is substance that goes along with it. There is nothing dignified about going the long hard way because that is how others got there. It is like saying it is wrong to fly to Cape Town for two hours because people in the past used to drive for 18 hours.

There is no room for black people, women and disabled people to feel “negative dignity” because of receiving access to opportunities through a special programme. What matters at the end of the day is how they use those opportunities to create more.

Terry Bell

Terry Bell

Money, historic distrust, poor communication by and between different parties, and the intervention of a small criminal element provided the volatile mix that exploded into violence at the Impala Platinum (Implats) Rustenburg operations.

At least one miner was killed this week and more than 10 injured as rioting continued after a series of illegal strikes. Spaza shops in the nearby informal settlement were looted.

While a large police contingent maintained relative calm yesterday, the precise cause of the strikes and subsequent rioting was still being assessed.

Implats chief executive David Brown claimed rivalry between the dominant National Union of Mineworkers (NUM) and relative newcomer the Association of Mineworkers and Construction Union (Amcu) sparked the incidents.

But both unions deny this was the case, although they concede clashes between individual members of the two unions may have been a contributing factor once the strikes had begun.

“We have fewer than 1 000 members at Implats out of about 25 000 workers and, as a union, we are not involved there,” said Amcu general secretary Jeff Mphahlele.

NUM spokesman Lesiba Seshoka agreed: “A small minority could not have caused this. The real trigger was management unilaterally announcing an 18 percent bonus for miners only.”

This bonus announcement was made in December and immediately led to disruption at Implats, because the skilled and generally more highly paid rock drill operators felt they had been excluded. They demanded an after-tax wage of R9 000 a month which they see as differentiating between them and ordinary miners.

“We in NUM were also angry because this announcement was made without first consulting us, and only months after we had concluded a two-year agreement with Implats,” said Seshoka.

But Implats management categorically denied that NUM was not informed or the union did not approve the bonus pay.

At this stage communication seemed to have broken down, and rumour and suspicion, sometimes verging on paranoia, took hold. The rock drill operators went on strike illegally, and without their services there can be no mining.

A large number of miners apparently interpreted NUM’s intervention with management as a union attempt to stop the bonus payment. Thousands of miners went on strike amid reports of widespread intimidation.

Management and union members agree this caused some NUM members to defect to the apparently more militant Amcu, a Mpumalanga-based union that broke away from NUM in 1998.

This added sectarian fuel to the already blazing fire.

This is understandable as NUM, in recent years, has been involved in sometimes rancorous arguments with smaller unions that have eroded NUM membership. Prime among these were Amcu, established at Witbank’s Douglas colliery and formally registered as a union in 2001.

The bitter unprotected strike at Lonmin’s Karee shaft last year saw large numbers of NUM members switch their allegiance to Amcu.

“We now have majority membership at the shaft, but management still won’t recognise us,” said Mphahlele.

But most union members in Lonmin operations are still NUM members. The domination of NUM members at management level in human resources departments was distorting this numbers game, smaller unions claimed.

Whatever the truth may be, there is obviously widespread disgruntlement among NUM members in the platinum sector.

This situation has allowed other unions – often influenced by political groups opposed to the SA Communist Party and its close links with Cosatu – to recruit in what was once exclusively NUM territory.

Even the small Western Cape-based Commercial Services and Allied Workers’ Union now has members among miners in the North West. So does the Metal and Electrical Workers’ Union of SA, aligned with the National Council of Trade Unions.

The Johannesburg labour court is scheduled to soon hear a case brought by Amcu regarding the unionisation of the country’s oldest gold mines, in Barberton. Amcu claimed 1 000 of the 1 400 workforce were members, but said management refused to recognise this.

Amcu argued this failure to recognise the union, as a minority or majority at a shaft or mine, was unconstitutional.

“Workers have the right to join a union of their choice,” said Mphahlele.

Amcu plans to take the matter to the Constitutional Court.

This inter-union battle is certainly under way at Implats, but as a result of the upheaval caused by the initial bonus payment strike and not as the cause.

Seshoka points out that tensions were further heightened when management sacked 17 200 strikers and announced they would not be reinstated, although they could be re-hired. This means a loss of seniority and the benefits that go with it.

Reinstatement is now the main issue in discussions between management and NUM. The union expresses fears that Implats is using the situation to restructure the company to the detriment of the miners.

Seshoka feared failure of management to back down on the reinstatement issue would further inflame the situation.

“A culture of ill-discipline is growing and we have arrived at anarchy,” he said.

This he attributes to an influx of mainly young miners who are “angry and impatient”. As a result, NUM does not exercise control over many of the miners in a region “where we are by far the biggest union”.

All three unions at Implats – NUM, Amcu and Solidarity – agree that a key factor to bear in mind is miners are generally poorly paid for doing very dangerous work that brings in great profits for the companies.

This perception, in the absence of good communication, creates an environment in which rumours and opportunistic militancy thrive.

“And this is to the detriment of all unions,” said Mphahlele.

Given the loss of production at the world’s biggest platinum mine, it is safe to say it is also to the management’s detriment.

Out. Everywhere. Yesterday. Those three words sum up the mood here at home when it comes to American military presence outside US borders.

Out. Everywhere. Yesterday. Those three words sum up the mood here at home when it comes to American military presence outside US borders.

President Barack Obama is signalling he wants to get out of Afghanistan so badly he’s even taking a few political gambles to accelerate a pull-out. There’s also a more general sense that putting soldiers in other countries has proved a bad investment for everyone involved, rendering those nations sadder, rougher and poorer.

Given the parlous budgetary conditions in the US, the thinking goes it would be better to slash US defence spending. America needs money at home. This week, Obama proposed reductions in military spending, saying a cut suited America’s “strategic priorities”.

Yet the opposite may be true, at least when it comes to the most obvious form of investment – in economic growth abroad. That is the finding of a study published in recent weeks by Garett Jones of George Mason University in Virginia and Tim Kane of the Kansas City, Missouri-based Ewing Marion Kauffman Foundation.

The more troops, the more growth, the scholars found.

Looking at navy, army, marine and air force presence in 94 countries over 50 years – 1950 to 2000 – the authors found putting US troops in a country, starting from 0 to a presence of 100 000, about the number the US had in Germany during the period studied, was over time associated with an increase in the per-capita growth rate of that country by an extra 1.8 percentage points a year. Even an increase from 10 to 100 troops corresponded with a rise in growth of a third of a percentage point on average.

“This study suggests Africa is poorer than it would have been with more active alliances between the US and its many countries, particularly because of the absence of US bases there,” Kane said. Right now the concept of nation-building is unpopular. But the study suggests “nation-building has a half-century track record worth remembering”.

It’s worth noting that such sweeping conclusions are only possible because of something many young Americans never knew or have forgotten – the US was everywhere once, and for a long time. The Pentagon had an average of 730 000 soldiers stationed abroad in the 1950s and 762 000 during the 1960s. Then the numbers dropped to 502 000 in the 1970s, 447 000 in the 1980s and 269 000 in the 1990s. In any given decade, between 26 and 49 countries hosted American troops, according to data assembled by the authors, using Pentagon figures.

But is the experience of the previous century – when troops were heavily concentrated in European countries with courts and diverse economies – applicable in places such as Afghanistan or Iraq? In one encouraging sign, Jones and Kane found growth in places with fewer such institutions still accelerated when GIs were present. A prime example is Turkey.

What about military, economic or social aid instead of troops? Today it seems an easy substitute to the US voter, battle-fatigued as he is more than a decade after September 11 and two decades after Operation Desert Storm. But the authors found “more troops predict growth, but more aid does not”, Jones said. “Aid is not a good substitute for growth, even military aid.”

Conversely, the absence of soldiers seemed to hurt. Countries that asked the US to withdraw, like France in the 1960s and Thailand in the 1970s, afterwards paid a growth penalty.

The amount of growth forgone in Africa due to the absence of longstanding troops was tragic, Kane said. The 7 percent annual growth World Bank types once predicted for Ghana would have been more easily realised with troops than with all the aid it received, he said.

Interestingly, the troop growth effects prevail even after the US leaves a place where it has been for a long time. Sometimes there is an initial collapse caused by command economics. But when such countries open up, they tend to grow faster than countries that never had a US military presence. The troops’ presence also tended to bring in foreign direct investment from the US, supplying capital to locals.

Current thinking may be backwards. Defence spending, said to be part of America’s growth problem, might instead be part of its growth solution, Kane said.

Amity Shlaes is a Bloomberg View columnist. The opinions expressed are her own.

King Mswati III is gambling Customs Union receipts that have kept his government afloat for two decades will again buttress his rule, sparing him having to pledge democratic reform in exchange for loans.

King Mswati III is gambling Customs Union receipts that have kept his government afloat for two decades will again buttress his rule, sparing him having to pledge democratic reform in exchange for loans.

Pre-empting the outcome of any talks with South Africa on the need to open Africa’s last absolute monarchy to political plurality, Mgwagwa Gamedze, appointed by Mswati as a traditional chief as well as the Minister of Justice and Constitutional Affairs, has already announced political parties could not participate in next year’s parliamentary elections.

Because of the Treasury’s empty vaults, some essential government services have been cancelled for lack of funding. These range from the trivial (no toilet paper at ministries) to the severe – government tractors grounded during the planting season, which raises a threat to food security and grants to the elderly being suspended. The shutting down of services one after another has become a way of life for Swazis.

Foreign direct investment flatlined years ago. Despite regressive tax measures, that have seriously affected the middle class and the poor, government revenue cannot cover expenditures. Two-thirds of Swazis live in chronic poverty at the best of times, and this year failed crops will again force most of the population to rely on foreign donations for their survival.

A R2.4 billion loan offered by South Africa has been on hold since August. It was sought after Swaziland’s portion of receipts from the Southern Africa Customs Union (Sacu) declined precipitously. Usually more than 60 percent of the government’s budget came from Sacu. In those days, as money rolled in, the loyalty of Africa’s largest civil service per capita was secured and the nation’s security forces expanded.

Prince Mhlaba Dlamini, Mswati’s older brother, made the royal family’s view clear about South Africa’s bland call for little more than the monarchy’s acknowledgement that democratic change must one day come as a condition for receiving the R2.4bn. “This is like selling your wife for R100,” he said.

Mswati blasted the media for “speculating on something you don’t know about”, because reporters were “not in the room” when the loan was negotiated.

Yet, in November, Finance Minister Majozi Sithole suggested to parliament the government was close to signing the loan papers. Then, as happens at the end of every year, the king went into “seclusion” to observe some traditional rites, and all government decision-making froze.

When the king emerged this year, it was to a financial situation seemingly transformed. The prime minister announced R7bn in Sacu receipts would come to Swaziland in April. That seemed to end any concerns in the corridors of power that pro-democracy sentiments need be entertained. Mswati told visiting Equatorial President Teodoro Obiang Nguema Mbasogo “African problems need African solutions”.

That seemed to be a dig at the International Monetary Fund (IMF) and its recommendations Swaziland’s civil service, bloated with patronage jobs, should be trimmed, opulent spending restrained and the royal family should share more financial burden. The king had already moaned bitterly about the IMF twice in 2011. But the king’s remark also seemed to be aimed at all “others” – perhaps even South Africa.

That South Africa’s predilection for democracy worries Swazi leadership was illustrated recently by the justice ministry’s efforts, at the cabinet’s behest, to find grounds to arrest Quinton Dlamini, the president of the National Public Service and Allied Workers Union, who enraged Swazi Minister of Public Service Magobetane Mamba by singing South Africa’s national anthem in Mamba’s presence in the labour ministry’s board room. The union leader had previously caused consternation by wearing an ANC T-shirt.

Prime Minister Barnabus Dlamini happily reported on his return from the ANC centennial celebrations last month, South African President Jacob Zuma had praised Swaziland for its role in the struggle against apartheid. But the ANC’s use of confrontation and protest has long made Swazi leadership nervous.

During the 1990s, when the Swaziland Federation of Trade Unions (SFTU) held marches featuring toyi-toying, the dance was denounced in the Swazi Senate as a “corrupting foreign influence”. More recently, it was miffed the ANC would not dissuade Cosatu from joining the SFTU in border protests calling for democratisation.

Former SFTU general secretary Jan Sithole recently took aim at press secretary Percy Simelane for repeating the government line the Swazi people disowned political parties. Simelane said this was consistent with the Swaziland constitution.

Sithole reminded the Swazi press that when a long-delayed report on the constitution-making process – a 10-year undertaking that in the end left the king and his heirs in total control of the country – was released, it showed the document was based not on a plebiscite of a population of 1 million, but on the submissions of a mere 1 500 people. Of these, 80 percent of submissions had nothing to do with the constitution, “while 20 percent spoke in favour of multiparty (governance)”.

The current government “was imposed on the Swazi people, and that’s the truth”.

The government has not responded to Sithole, who has just formed a political party in waiting, the Swaziland Democratic Party. Like all political entities that have not yet been banned as “terrorist organisations”, this one exists in name only.

Now that Sacu money is imminent, South Africa has lost any leverage it might have had as an older SADC sibling urging peaceful transition for a more equitable Swaziland.

Without political parties offering voters platforms of policies and visions of governance, the upcoming 2013 parliamentary elections were meaningless, the election-monitoring Commonwealth Expert Team (CET) said. This team remarked after witnessing the 2003 election: “We do not regard the credibility of these national elections as an issue; no elections can be credible when they are for a parliament that does not have power and when political parties are banned.”

CET declined to monitor the last elections as nothing had changed in the country.

Having been able to cobble together enough money from sources unknown to keep civil servants from taking to the streets these past months, the Swazi leadership seemed confident they could hold on until April’s Sacu cheque arrives.

But then again, principal secretary at the Ministry of Finance Khabonina Mabuza has also just told the local press the Sacu windfall would be insufficient and the loan from South Africa was still key.

This was acknowledgement Swaziland had managed these past months only through heavy borrowing. Further, the South African loan is designed as a “debit card”, to be repaid by deducting from Swaziland’s future Sacu earnings.

Sandile Lukhele writes for the Independent Foreign Service

Maybe it is inevitable that politics play a role in economic policy. After all, the two disciplines were pretty much intertwined until the 20th century. Today, political economy has taken on a whole new meaning. Perhaps “politicised economy” would be a more accurate description. Some of the politicisation is natural and understandable: political philosophies dictate economic preferences and vice versa. Much of it is over the top.

Maybe it is inevitable that politics play a role in economic policy. After all, the two disciplines were pretty much intertwined until the 20th century. Today, political economy has taken on a whole new meaning. Perhaps “politicised economy” would be a more accurate description. Some of the politicisation is natural and understandable: political philosophies dictate economic preferences and vice versa. Much of it is over the top.

Here are the categories I’ve assigned to reflect the four degrees of politicisation:

l I Think, Therefore I Am

It’s natural for a president to appoint advisers who share his views on the government’s role in the economy.

Once an economist becomes a top presidential economic adviser, she becomes a political tool, sacrificing both her objectivity and credibility. Berkeley economist Christina Romer, US President Barack Obama’s first chairman of the Council of Economic Advisers, may be a respected researcher, but to me she will always be Ms “Jobs Created or Saved”. Romer was trotted out quarterly to justify the cost of the administration’s 2009 fiscal stimulus, estimated at $825 billion (R6 trillion). Talk about pulling numbers out of a hat.

l Sour Grapes

If the foregoing reflects the inadvertent politicisation of economics, what follows is intentional, pure and simple.

Last Friday, the Bureau of Labor Statistics reported a 243 000 increase in January non-farm jobs (257 000 in the private sector) and a decline in the unemployment rate to a three-year low of 8.3 percent.

Republicans, hoping to run in November against Obama’s lousy economic record, would prefer a rising jobless rate to a declining one, which historically has been a good credential for re-election.

“Anaemic growth is not growth,” said former House speaker and Republican presidential hopeful Newt Gingrich, responding to the report. Critiquing the stimulus and other administration initiatives is a legitimate line of enquiry. Even better is outlining your plan to make things better. Denying good news – in this case, a gradually improving economic trend – makes Gingrich come across like, um, a space cadet.

l Yes, But…

House Speaker John Boehner said he saw “flickers of hope” in Friday’s jobs report and welcomed the positive news, but “we can do better”. The jobless rate had been stuck above 8 percent for 36 consecutive months, he said, before reminding the American people of Obama’s promise to cap unemployment at that level if Congress passed his stimulus bill. (Actually, it was Romer’s econometric model that made that promise.)

Boehner did go positive, in a negative sort of way, saying he hoped the news would inspire the Senate to take up the 27 jobs bills sitting in that chamber.

l Oh, What a Tangled Web We Weave

At the far end of the politicisation spectrum are those who believe the government cooks up the numbers in some dark corner of the Labor Department basement. It’s as if these folks decreed: “There shalt be no good news as long as Obama is president, the federal government is expanding and the Federal Reserve is printing money and debasing the dollar.”

I have a message for them. It’s not the data that are politicised. It’s the interpretation. Friday’s report inspired an outpouring of accusations of “fraudulent employment statistics” and long screeds on updated population estimates from bloggers (ZeroHedge and the Economic Collapse) and editorial writers (the Washington Times) alike.

The household survey for January incorporated new information from Census 2010. Previous months were unrevised. Simply put, there is a December/January break in all the series that rely on the new estimates.

Conspiracy theorists seized on the 1.2 million increase in those “not in the labour force”. Adjusted for an apples-to-apples comparison, the number fell by 75 000 in January. That’s because the population increase was concentrated in persons 55 and over and in the 16-24-year-old age bracket: a population less likely to be in the labour force than the general population.

None of this is to deny the depressed state of the labour market. But before you accuse me of naivete and Bureau of Labor Statistics statisticians, who are not political appointees, of fraud, ask yourself one question. If the government were fabricating the numbers, why settle for an 8.3 percent unemployment rate when 6.2 percent would better serve its agenda?

Caroline Baum, the author of Just What I Said, is a Bloomberg View columnist.

The 2012 State of the Nation address theme was resoundingly focused on infrastructure development.

The 2012 State of the Nation address theme was resoundingly focused on infrastructure development.

This has been taken as a negative by some analysts, saying that the speech was pedestrian and not inspirational enough. There was an expectation from some people that – this year being an election year for the ANC, as well as a centenary one – a more emotion-rousing speech would be in order. I have a different view.

The economy has been the main topic for most governments in recent weeks. German Chancellor Angela Merkel delivered the opening address at Davos which focused on the economy. US President Barack Obama’s State of the Nation address equally looked at the economy. This is the most pressing thought on most leader’s minds around the world.

The European debt crisis has a cascading effect on their economic partners and their respective capital markets. So any leader worth his salt will give serious consideration to the spill-over effect of the debt crisis on his country and try to find ways to manage those effects.

Furthermore at the Mining Indaba, the investors, both locally and offshore, were quite keen to get an indication of the focus of the South African government on an array of issues which included infrastructure development as one of the priority items on their list.

So President Jacob Zuma’s focus on infrastructure development was spot-on. The issues of inspiration and ANC elective conference require a different platform than the State of the Nation address.

Most people are affected by the constantly changing economic conditions that the country will be facing going forward and this creates a level of angst and uncertainty for them. Therefore, focus on the economy brings some comfort that something concrete is being done to bring about economic stability.

The infrastructure projects that were outlined are a step in the right direction. However, there are leadership and procedural challenges facing the implementation of the infrastructure projects.

The seamless co-ordination that is required between the players in the infrastructure game is quite intricate and very politicised. This means that it is inevitable that some balls will be dropped but hopefully there will be useful lessons that emerge from the experience.

The current Presidential Infrastructure Co-ordinating Commission (PICC) may minimise mistakes by making sure that the different infrastructure stakeholders within the government are represented.

The role that state-owned entities are going to play in infrastructure development is crucial because they are the only players that operate on private sector principles while fulfilling the social obligations set out by the government.

The funding of such projects given the funding climate around the world will be a challenge. The negative outlook from some credit rating agencies on South Africa’s debt is potentially going to increase the cost of our debt. This means our capacity to spend on other areas of government requiring service delivery will be impaired.

The sentiments voiced by the ANC Youth League on nationalisation has cost the country in real terms through the rating downgrade, as well as the opportunity cost of potential investments that would have been made but ended up being diverted elsewhere.

The Gauteng e-tolling debacle and its handling is also sending negative sentiment about the ability of some of our state-owned entities to handle the infrastructure funding process without glitches.

This might not be really applicable to all our infrastructure projects, but the first impressions for some investors represent indelible reality for them, which can have negative results. So unambiguous messages from the PICC about how infrastructure projects are funded will go a long way in easing investor fears. The reality is that South Africa has successfully used sound funding models that worked for infrastructure projects such as the N3 toll road and Gautrain among others, and we need to showcase that to investors.

So overall, the president’s speech was an improvement from previous years and gave a solid view of what we need to expect on the infrastructure front. - Vuyo Jack

Bench Mark Foundation’s website has a three-minute video about the Hondelklip community based on the west coast of the Northern Cape, which is trying to cope with the aftermath of decades of mining activity by De Beers.

Bench Mark Foundation’s website has a three-minute video about the Hondelklip community based on the west coast of the Northern Cape, which is trying to cope with the aftermath of decades of mining activity by De Beers.

Right now De Beers is poised to pull out of the area and sell what is left of its operation to Trans Hex; the community is opposing this because it fears that Trans Hex will not undertake the necessary rehabilitation when it has finished with the area. The community’s fears are based on its previous experience with Trans Hex.

The Hondelklip community wants to ensure that De Beers rehabilitates an area that it has mined for 80 years before it is allowed to pack up its bags and head off for new pristine, diamond-rich tracts of land in other parts of the country or of the continent.

The community fears that De Beers will be allowed to implement a deal that, from an environmental perspective, commits to the necessary legal undertakings but in reality may prove to be worthless.

The poignant video highlights just why it is that calls for nationalisation of the mines will never end.

Not only are such calls likely to get louder but the issue will forever be easily exploitable by opportunist politicians such as ANC Youth League president Julius Malema, which is why it would be foolhardy of anyone to assume that the departure of Malema from the youth league will put an end to calls for nationalisation.

The reality is that as things stand, communities across South Africa, indeed across all of Africa, have generally been worse off as a result of mining activity.

They may have benefited from low-skilled employment opportunities or some temporary largesse awarded them by corporates keen to get access, but unlike the companies these communities are unable to move on when the mining resources have been exhausted.

They are forced to live forever with the frequently devastating impact that the mining activity has had on their environment.

It is not just that the environment is left in an unspeakably ugly state, it’s that rivers and water sources have been poisoned and the air contaminated.

Thus the two essential ingredients of their agricultural-based livelihoods are destroyed because mining companies have been allowed to externalise a huge portion of the costs of doing business.

For all the talk – and there is much by well-paid consultants – about sustainability and corporate social responsibility, poorly resourced rural communities are in no position to make demands from what are often the largest and most powerful companies in the world.

The hordes of people who have become enormously wealthy through mining throughout Africa have invariably been the shareholders of mining companies, in particular the controlling shareholders of mining companies.

And so it is that we have the bizarre situation, described by the Southern African Resources Watch (Sarwatch), in which the owners of the resources – namely the community – are made poor through the process of mining their resources, while the buyers of those resources are made enormously rich. It is why, says Sarwatch, Africa is described as a wealthy continent with a poor population.

Risking the short-term loss of skittish investors should not discourage us from having a debate that helps to ensure poor communities are not forever left carrying the costs of mining our valuable resources.

Just why do a hundred civil society leaders from across the continent get together each year around the African Mining Indaba in what is called the Alternative Mining Indaba?

Just why do a hundred civil society leaders from across the continent get together each year around the African Mining Indaba in what is called the Alternative Mining Indaba? Civil society has difficulties in accessing the mainstream event due to the exorbitant entry fee of R12 000 a delegate.

The Bench Marks Foundation, one of the participating organisations, has long held the view that, while there is much talk about the need for investment, very little thought is given to how this investment should be undertaken. With investment, especially in mining, there are winners and losers. The winners are shareholders and executive management who get all the benefits, and the losers are communities. How can this be true when we hear all the time that mining creates jobs, that communities are better off and that taxes are paid to the state that benefit people?

So why are civil society groups excluded from the official mining indaba? The Alternative Mining Indaba believes that this exclusion is carefully designed because civil society will tell a different story, one of affected communities who live in despair, who suffer cultural shock, lose access to livelihoods, and then have to deal with a wide range of environmental and social problems.

With mining comes a host of environmental issues. Contamination of both underground and service water deprives subsistence farmers and big agricultural businesses of water. Cattle and grazing land is affected, depriving communities of an income. Air quality deteriorates and results in respiratory infections. In Rustenburg, where platinum mining is big, nearly 60 percent of people reporting to local clinics suffer respiratory diseases. This externalisation of cost is not captured in the financial records of the companies but is passed on to communities, who have no voice to protest, or influence policy.

The jobs on offer never materialise, migrant labour is attracted to mining areas, putting strain on amenities. This places an increasing burden on local government services. Rarely is this considered a cost to mining. In South Africa, with the living allowance, migrant workers live in back shacks or overpopulate informal settlements. Women who have lost access to their livelihoods turn to sex work with migrant workers, resulting in the proliferation of HIV/Aids. This further contributes to overburdening hospitals that can’t cope.

Mines often relocate people, not fully taking into account the rural lifestyles or subsistence livelihoods, and remove people to suburbs, from what we call a rural existence into the market economy. Contrary to illustrious and flashy sustainability reports, we have yet to find a community that will tell you that they are better off.

The context we operate in is governed by a structural problem. The structural problem that relates to corporate doctrine in brief is: “The mighty do as they please and the weak suffer as they must.” Corporations have immense influence over governments’ investment policy, especially over regulations governing operations, labour, communities and often lowering standards, whether environmental, social or economic.

Partly this is a structural problem of the present economic model, rampant profiteering at any cost, and what Joel Bakan calls the psychotic nature of corporations. This psychotic nature comes from pursuing its material self-interest at any cost. In this economic model, the ecosystem has been viewed as a subsystem to take from, exploit, save costs and increase profits.

So, if we were at the Mining Indaba in any numbers, we would be calling on mining companies to internalise all the costs they pass on to society; doing business in a way that considers the broader environment in which they operate. This includes people, the ecosystem, the social crisis of unemployment, deepening poverty and inequality, and the looming crisis of climate change and a heating planet. We will be calling for a redistributive path, a just economic and democratised system, where the interests of all people, present and future, are considered above all else.

We would challenge the dominant theory of trickle-down benefits and growth at any cost, that permeates the thinking at the Mining Indaba, while not considering the finite resources or that it is only world elites that benefit, pushing more people into absolute desperation and poverty and pushing our planet towards extinction.

We would talk about corporate social responsibility and the truth, and contest these corporations in their sustainability reports, where they tell us how good they are, ignoring the voices of communities; communities who are more often than not worse off, whether they are local mining communities or broader society. We would tell the world that profit beyond all else, material greed and shareholder returns dominate resource extraction and not sustainable development.

The Alternative Mining Indaba raises issues that the African Mining Indaba deliberately refuses to raise – issues of poverty, the lack of job creation, tax holidays, tax avoidance by mining houses, secrecy of mining agreements, shoddy environmental impact assessments and social and labour plans that don’t address communities.

Most African countries have had independence for 50 years, have listened to the International Monetary Fund and World Bank prescriptive policies, but have failed to industrialise and develop their economies. In Tanzania 12 years ago, there were over 200 000 artisanal miners making a living out of gold mining. Today the country is dominated by Barrick Gold and AngloGold Ashanti, which employ fewer than 10 000 workers. The beneficiaries are shareholders. In Zambia’s copper-belt region, towns were flourishing as mines sourced various services from local industry. Today they are ghost towns, local businesses have disappeared, and unemployment and destitution are rife as mines import services.

One just has to look at towns like Welkom in South Africa; once a thriving mining city, Welkom is now a shadow of its former self. But if we look at Ndola in Zambia in years gone by, we have some idea of the developmental role mining can play, but no longer does. Glencore, the world’s biggest commodity trader, sources most of its minerals cheaply from artisanal miners and declares its revenue elsewhere, thus depriving the Democratic Republic of Congo (DRC) of taxes and proper benefits.

The Alternative Mining Indaba recognises that mineral extraction in just about every African country is corrupt, with government officials complicit and enriching themselves at the expense at community interests.

The province of Mpumalanga is rife with former government officials who have strong interests in coal mining, but who do not have the necessary know-how, but milk the province dry. Many mines do not have water licences. Farmers can wake up in the morning and, like communities in Limpopo with mining rigs on their land, be informed that their land is being prospected for minerals.

Whether we look at the DRC or South Africa, the communication with affected groups is weak. They are merely informed of decisions but their consent is not sought.

Communities across Africa at the Alternative Mining Indaba state categorically that communities want a bigger share in mining, that they want community capital to be developed, to be the beneficiaries, and in South Africa, to be the preferred black economic empowerment partner.

It is in this context that calls for nationalisation occur and Julius Malema’s call for economic freedom in our lifetime finds a receptive audience. Communities that are affected and that make way for mining, are no longer prepared to accept the status quo. They want real development that incorporates their needs, jobs, skills and their human development potential.

Many at the Alternative Mining Indaba consider the African Mining Indaba as the looters’ conference with short-term profit maximisation and shareholder returns as the true intent, not meaningful sustainable development of host countries. If we were present at the indaba, we would be talking about long-term, sustainable development that incorporates communities’ interests; how to cost the true value of mining by pushing for accounting procedures that cost social, economic and environmental impacts on to companies’ balance sheets.

We would be talking about ethical business practices and not the present practices at the expense of other interest groups and communities.

The Alternative Mining Indaba theme is “Just Mining or Just Profits”, and we need to ask, is it mineral extraction at any cost? Are profits ethically earned, with ethical practices dominating?

The UN’s John Ruggie process on human rights states that governments have the responsibility to protect human rights, and corporations must respect and remediate any negative impacts. However, governments are failing in this regard.

We believe there is a role for independent monitoring and evaluation and a role for community monitoring to hold mining corporations accountable.

But to do so we need independent funds to capacitate communities to engage with mining houses on a level playing field. To back this up we need an independent grievance mechanism, independent of the company, supported by an independent fund contributed to by mining corporations. It must be quick and easy to use, bring redress, be able to hold corporations accountable and must address any adverse impacts on communities.

Prior to business operations beginning, a local barometer should be used, using expertise from civil society to ascertain potential human rights impacts as they pertain to the social, economic and environmental consequences of operations.

Corporations need to go beyond host government rules and standards, and measure themselves against all the UN declarations on human rights, International Labour Organisation and other applicable international standards that include civil, political, economic, social and cultural rights. International finance institutions and private equity investors need to do their own due diligence when providing funds. We need an economy that serves the interest of people, meeting their needs.

Perhaps the Alternative Mining Indaba is idealistic, but what alternatives do we have other than to promote an agenda that incorporates the interests of communities? It is no longer acceptable to dig for resources in our back yard, leaving nothing but a hole behind. We need a developmental path that lifts Africa out of its doldrums, which gives returns and addresses marginalisation and exclusion.

John Capel is the executive director of Bench Marks Foundation and Alternative Mining Indaba.

Politics is a messy business at the best of times, especially when you are a party boss. This week Lindiwe Mazibuko, just over two months since her election as the DA’s parliamentary caucus leader, shuffled her shadow cabinet.

Politics is a messy business at the best of times, especially when you are a party boss. This week Lindiwe Mazibuko, just over two months since her election as the DA’s parliamentary caucus leader, shuffled her shadow cabinet.

She has played it safe, carefully placing her key opponents in her race against Athol Trollip in some key portfolios, but overall it is her winning faction which got the greatest pickings. Trollip takes on rural development and land reform, a post she herself held.

David Cameron, now the British Prime Minister, was elected Tory leader in 2005 against David Davis – who had won the first round caucus vote but fell behind Cameron in subsequent votes.

Like Cameron, Mazibuko parachuted to the job of leader of the parliamentary opposition and could appoint a shadow cabinet. Like Mazibuko, Cameron kept his main rival on board. Davis was named shadow home secretary and sometimes stood in for Cameron as Conservative leader when he was on leave.

However, by 2008 Davis – who had come so close to being leader of the opposition – quietly resigned as an MP. It may be a hint of what will happen to Trollip in the medium term.

It is an unfortunate unwritten rule about politics that good, and able, people like Trollip are unlikely to recover from a political defeat among their peers.

There are mutterings in the corridor that he will again take on Helen Zille, known to be a key architect of his downfall, for the national leadership of the DA.

The chances of him succeeding at ousting her appear – at least at the moment – rather slim, most significantly because the party is generally perceived to be on a growth spurt.

Among the biggest losers in the new shadow cabinet line-up is Dion George, a Trollip backer who was the shadow finance minister for the past four years.

He was moved downward – to shadow minister responsible for the standing committee on public accounts.

Another is Manie van Dyk, who slips from shadow public enterprises minister, to a minor portfolio of deputy spokesman for science and technology.

Van Dyk, another Trollip backer, faces disciplinary action for the alleged misuse of his travel privileges.

Van Dyk’s public enterprises deputy, Pieter van Dalen, who had a far higher profile than Van Dyk, was moved sideways to shadow deputy agriculture minister.

Lourie Bosman, a former AgriSA president who believes he had done an excellent job as shadow agriculture minister, is miffed at being shifted out of his position to become shadow deputy minister for higher education.

About 25 of the 36 in the shadow cabinet are Mazibuko supporters. The most notable rise in the ranks goes to Tim Harris, a new MP who becomes shadow finance minister.

Some heads have rolled and some silly appointments have been made, but Mazibuko has a certain leeway to move because the party is seen to be transforming its image away from being a white dominated party. It means the new shadow ministers will have to undergo a steep learning curve which may weaken the DA’s parliamentary performance in the short term. Mazibuko would argue that taking the party out of a rut may embolden it.

Even Masizole Mnqasela, who bitterly opposed her selection and has been accused by Zille of using “Verwoerdian” language in doing so, believes that her shadow cabinet team needs to be given a chance. - Donwald Pressly

In the past few days there has been extensive media coverage of the auditor-general’s General Report on National Audit Outcomes. This report outlines the summary of audit findings across national departments and public entities for the 2010-11 financial year.

In the past few days there has been extensive media coverage of the auditor-general’s General Report on National Audit Outcomes. This report outlines the summary of audit findings across national departments and public entities for the 2010-11 financial year.

Using a metaphor of the body to represent South Africa, the various national departments and public entities represent the internal organs and parts of the body of South Africa. Two critical elements allow the body to work – the head and heart.

I would suggest the National Treasury is the government’s heart and the presidency its head. The heart pumps blood throughout the body to ensure it functions optimally, while the head co-ordinates the entire body’s functions and houses the most delicate organ – the brain.

The National Treasury houses the revenue-generating entity, Sars, and dispenses the money through the budget process to the body’s various parts, including the head. If you stifle the blood flow to certain parts of the body they invariably suffer.

The presidency, which includes the two key functions of national planning and performance monitoring, and evaluation and administration, is supposed to co-ordinate the government’s various functions.

Other departments can also be compared to various organs and body parts. The auditor-general is the independent economics doctor. He diagnoses the problem, and provides suggestions and prescriptions for South Africa’s economic body to be healthy.

The auditor-general cannot force anyone to take their pills, which leaves the responsibility of enforcing the prescribed medicine to the body’s head.

The auditor-general’s report provides the analysis of the problem and gives us an indication of the severity of the various organs and body parts’ condition.

There are fives conclusions: a clean bill of health; a financially unqualified opinion, which means while the body is technically fine, there are minor concerns; a qualified opinion, which shows symptoms of concern that need urgent attention; an adverse opinion, which indicates something is gravely wrong with an organ or body part; a disclaimer of opinion, which means things are so bad no conclusion can be reached as the vital signs are impossible to read.

In the 2010/11 financial year only 8 percent of the organs and body parts of South Africa’s national departments were functioning well. About 67 percent of national departments had financially unqualified opinions. But problems were identified in meeting predetermined objectives of the organs and compliance with laws and regulations that govern the body.

This means if you don’t achieve these objectives or comply with laws and regulations, those organs start decaying and compromise the body. Altogether 26 percent of departments received qualified audit opinions. These accounted for 53 percent of total voted funds. This means more than half of South Africa’s economic body has symptoms of ill health. The Department of Public Works received a disclaimer of opinion.

This department, which oversees the public sector’s resources and infrastructure, can be likened to the skin that covers the body. Effectively, the doctor says the skin is so damaged, he cannot ascertain the extent of the damage and can’t give an opinion. This is not good for the country’s body politic. Imagine the doctor gave the heart and head qualified opinions then the entire body would be crippled. Luckily South Africa is not there yet, but the warning bells are ringing.

The doctor prescribes basic maintenance functions should be performed for the body. These include proper record keeping, preparing monthly accounts, regular basic reconciliations, and monitoring compliance with laws and regulations on an ongoing basis, and putting internal controls in place. The bottom line is leadership from the top is needed to monitor and discipline the body when needed. - Vuyo Jack