Business Unusual
Roshan Jainath | Author
From the Basque areas of Spain emerges a glimpse of a multinational cooperative that demonstrates a successful socialist model of doing business in a capitalist environment. The co op known as the Erreka Group
is a highly sophisticated and a multi million euro enterprise. The reason this socialist model works is because of the level of skill of its employee shareholders. Without that requisite skill it is impossible to achieve that turnover across such a diverse portfolio of business. This model of employee ownership at scale must be celebrated.
Let us examine state ownership as opposed to employee ownership. A case in point is the State Owned Enterprises
(SOE’s) in South Africa. We have come to accept that government guarantees all loans and working capital in SOE’s. In the context of South Africa, the money spent on SOEs could provide homes and associated development for all the poor people in SA. Inspite of state ownership of SOE’s these enterprises exist for the pleasure and profit of the capitalist class and non performance related salary packages for elite civil servants. Can an argument exist for a pro socialist retention of SOE’s in its current form?
Semi privatisation is intended to shift shareholder risk. Minister Pravin Gordhan seems to be adopting private equity as a model of choice for the turnaround strategy of SOE’s. This will no doubt raise the ire of trade unions and factional political opponents of Gordhan.
Let us explore this dynamic. In my view a pragmatic response is emerging to South African conditions and context in the restructuring of SAA, Eskom & Transnet by Gordhan. The opposition has called for SAA to be shut down. The old socialist in Gordhan won’t pander to this wish. He will find an equity partner and preserve the national carrier and many jobs as well. It won’t be an easy process for many employees and stakeholders but a sustainable project may yet materialise.
In his defense Telkom, which is a semi privatised company no longer costs the state billions of rands for bailouts. The semi privatisation of Telkom was not without employee upheaval in the unbundling process or lower standards of service to a then monopolised customer base, many of whom have shifted loyalties.
However let us examine the worst blunder in corporate SA which was when Telkom sold
its shareholding in Vodacom. A solid case study for selling shareholder value to fund state enterprise losses possibly from widespread looting.
Look at diamond mining in Botswana. De Beers owns 51 % of all mines in Botswana. The state owns 49 %. The government and the people of Botswana profit from shareholding and tax income of profits from diamond mining.
Now compare this to the hoax of the century called BEE. This is a capitalist project. One must not confuse transformation and socialism. South Africa addressed transformation in a manner which suggests that capital hijacked transformation. In fact BEE was founded in the boardrooms of the mining companies.
State ownership in private companies is actually transforming shareholding to a broader base in Botswana.
BEE sometimes has single entrepreneurs in multiple deals where only that entrepreneur benefits. We celebrate this capitalism in the name of transformation and demand that the national project must be to ensure transformed business instead of transformed communities. In fact citizens must demand shared value from natural and national resources.
The RET brigade, an ANC faction, believe in black monopoly capital. Not socialism! They are African capitalists posing as Marxists.
In-fact the looters in the EFF and ANC have hijacked the Marxist narrative. They speak of white monopoly capital in the name of a white Karl – the original Marxist.
Capitalism is a way of life. It reinvents itself and takes on many forms. Beware the label of socialism often used by the masters of disguise. A true Marxist will dedicate his energy to developing a classless society or at the very least a co- existence of classes.
When communities partner with business, the State & NPO’s to fundamentally improve the lives of the disempowered then this will challenge the dictum of business as usual.
The African visionary will speak about time, place and context. The context of socialism in Europe is built on its education system and their skills. Those models won’t currently work in SA but a partnered developmental state in SA will get us there, in time.
Our biggest challenge to advance socialism is education and skills development.
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