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South Africa: The Thick End of the Wedge

6 October 2008

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opinion

Johannesburg — JUDGING by the Sunday papers, in just a few days a breakaway party from the ANC is going to be formed. It is a stupid idea really, because none of the fighting inside the ANC these past few years has been about policy.

It's all been personalities. First Zuma got stuck and now, in revenge, Mbeki has been fired. We already have enough parties fighting for the political centre on SA. What's another one going to do?

And I doubt the worthies on the "losing" side of the current round -- the Lekotas, Shilowas and Erwins -- have the energy to do what's needed to run a new political machine; set up a branch structure, get members, register in time for the election, get a list together and, oh yes, a manifesto. Not once in the past week have I heard a single aggrieved minister or official mention a political idea. So it would be a glamour thing. They wouldn't even trouble the Democratic Alliance, let alone the African National Congress.

Not that the ANC needs much troubling. It is already a shambles, with poor old Gwede Mantashe, secretary-general, running around with a fire extinguisher, and where he isn't able to attend to a fire (like Terror Lekota's open letter) the guy he gives the job to (Jeff Radebe) makes a mess of it.

Don't get me wrong. It'd be great to have a new party around, particularly a black one led by some thoughtful people. But it would have to be in for the long haul, and build itself an ideological home slightly to the right (eish!) of the current ANC. n

MEANWHILE, the ANC sits with one truly precious asset -- President Kgalema Motlanthe. Yes, he's supposed to be a seat warmer, and any sign of support from people like me for him to stay on after the election next year is the Kiss of Death. But the fact is that with all the infighting around party president Jacob Zuma, and Mantashe, the one person pretty much the entire country trusts is Motlanthe. If the ANC wants the rebel threat to go away it should allow him to govern. First on his list must surely be the immediate reinstatement of Vusi Pikoli, the head of the National Prosecuting Authority, cynically suspended last year by Mbeki. That would blunt the spears of the rebels more effectively than anything else. n

NOW that the Bush Administration has successfully panicked Congress into providing $700bn to buy bad assets from US banks, expect the spotlight to switch to Europe (it'll soon be back on the US when the bail-out turns out to have failed) where, this morning, the German government is going to come under pressure to bail out Hypo Real Estate bank. Berlin has been reluctant so far to step in and "nationalise" struggling banks the way the UK has, and thought it had tied up a $48bn private sector takeover rescue for Hypo. But it fell apart on Saturday, portending the biggest German financial crisis since the Second World War.

It is too early yet, but somehow, at the end of this gathering catastrophe in the world, executives who lied about the value of the assets they claimed to have should go to jail. I like the UK model. The state should own the banks it rescues, and their executives should get the chop. Banking, if you have integrity, should be a simple business. n

I AM no longer comforted by the stock explanation in this country that our banking system is okay because it is not exposed to the rotten assets that have sunk Lehmans and others. The fact is our banks cannot know what they might be indirectly exposed to. No exposure to Hypo, for instance? You cannot know because you can't know who is exposed to Hypo that you might be exposed to. Hell, even the Reserve Bank has some reinsurance exposure to AIG -- who doesn't? Motlanthe should consider copying Gordon Brown's weekend example and constitute a permanent group of senior and experienced and wise advisers -- not bankers or businessmen a la Mbeki -- to help him prepare for when the crisis finally comes ashore here. Because it will.

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