South Africa - Moeletsi Mbeki: Analyst, Entrepreneur and Author

Little brother pulls no punches about BEE’s failures, writes Chris Barron.

Moeletsi Mbeki dismisses as a “fallacy” and a “myth” the line that the government’s black economic empowerment policy was necessary to give blacks a stake in the mainstream economy of the country.

They already had a very sizeable stake in the economy through their pension funds, said the free-thinking political analyst and brother of the former president in an interview with Business Times after the release of his book, Architects of Poverty.

And the initiative for the policy which saw the transfer of equity to and overnight enrichment beyond their wildest dreams of a few politically well-connected blacks came not from the ANC but from big business itself to stave off nationalisation.

“There was a strategy by big business to co-opt the likes of Cyril Ramaphosa who were the political leaders of the black people, and to devise ways of co-opting them,” he said. “And this was initiated by big business.”

The idea was to get the political leaders onside, to make them allies of big business.

What about the political imperative of giving blacks a stake in white-owned companies?

“It is a fallacy to think that blacks don’t own the big corporations in this country,” said Mbeki. “They do, via their pension funds.”

It’s a popular mistake to believe that BEE is redistributing the wealth only of whites.

“The reality of BEE is that it is also distributing the assets of the black workers to the black politicians. When a listed company whose shareholders include the black workers’ pension funds gives 10% of its shares to the black politicians it is redistributing the wealth of the black worker as well to the politicians.”

Why has Cosatu gone along with that?

“Because Cosatu don’t understand the political economy of SA, they think they are not the owners of these companies. The reality is that they are. But because they don’t understand the political economy of SA they are going along with something that is dispossessing them.

“They think they can ingratiate themselves with the politicians of the ANC, so in the past four years they have been crawling to Jacob Zuma, thinking that they will use him. But Zuma has ignored them once he got into power. He ignored them and privatised Vodacom.”

Who will win the current battle for control of the government, does he think?

“Zuma already has.”

What about ANC secretary-general Gwede Mantashe? Isn’t he calling the shots from Luthuli House?

Mbeki gives a knowing chuckle.

“No. Gwede doesn’t call any shots. He’s a big mouth, but don’t mistake a big mouth with calling the shots.”

When Moeletsi Mbeki, 63, went into exile in 1964 he decided that, unlike his brother, he wasn’t going to be beholden to any particular political party or group. He was going to be his own man.

In the words of Mark Gevisser in his biography of Thabo Mbeki, Moeletsi “developed a work identity independent of the liberation movement”.

When he left SA he began studying physics, chemistry and maths at the University of Lesotho. But his political activism caused complications and after a year he left for Britain where he threw himself into the rebellious student movement of the 1960s with a joyous abandon that his older brother found both distasteful and irresponsible.

He studied engineering and sociology and worked as an engineer and journalist in Britain, Tanzania and Zimbabwe, where he lived for 10 years.

After returning to SA he could, as Thabo’s brother, have sunk his snout into the trough big time and made billions. Instead, he became a successful entrepreneur and an astute political analyst who was never afraid of stepping on any toes.

He was openly critical of the government’s gently-gently policy on Zimbabwe. The way to get rid of Mugabe, he said, was to pull the plug on Zimbabwe’s electricity supply from SA.

So instead of embracing BEE, what should the new ANC government have done?

“Acknowledge poverty and unemployment, the consequence of the National Party’s economic model, as the biggest challenge. They should have changed that economic model to build an inclusive economic system whereby entrepreneurship is open to everybody, black or white, and supported entrepreneurs to create jobs and exports for the country.”

The trouble with BEE is that “the guys who were given shares are not creating jobs, they’re not creating new products, they’re not creating anything that will increase our exports.”

What about government efforts to create a broad-based BEE?

“They’re a smokescreen to cover up for the fact that BEE is a politician’s Ponzi scheme,” he snorted.

Affirmative procurement, for example, simply makes things more expensive for blacks because it forces them to buy from a black middleman.

“Affirmative procurement enriches the middleman who is not producing anything himself. Black people, mostly the poor and working class, are being ripped off to enrich these guys.”

Why can’t they see it?

“They have no leadership. Cosatu lost their leaders in 1994. The unions are left with leaders who have no education, no knowledge, no expertise. That’s why the poor are being ripped off.”

Mbeki also comes out strongly, as he has for years, against affirmative action.

Would “white” companies have employed black people in sufficient numbers if the government hadn’t held a gun to their heads?

“Absolutely. The reality of SA is that there are half-a-million professional vacancies in the country. We don’t have enough qualified professionals. If you have a qualified doctor or engineer or architect, whatever his colour he will be employed in SA. You don’t need government legislation. Anyone with skills will get a job.”

Hasn’t affirmative action been instrumental in expanding the black middle class?

“The sad thing about the black middle class in this country is that most of them are service administrators — they’re not entrepreneurs.

“The middle class we really need to create in this country are entrepreneurs. We need people with technical skills to build the companies and create the jobs.”

Affirmative action has been a major disincentive combined with an education system that does not produce people with the requisite technical skills.

Talking about affirmative action: is there anything in the rumour that he offered Thabo a job in his TV production company?

Absolutely not, he said.

“I guess we could put him in the Big Brother house,” he chuckles, “but I don’t know if he has that sense of humour.”

Certainly not — if he reads little boet’s book first.

In brief

Marital status: Not married, one child

Defining moment: The arrest of my father in 1963

Personal philosophy: Hard work always wins

Current reading: China’s African Challenge by Sarah Raine

Relaxation: Listening to music

By Chris Barron Sunday Times Johannesburg

http://www.thetimes.co.za/Business/BusinessTimes/Article1.aspx?id=1024540

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