A Green New Deal for South African workers?

Speaking recently on a proposal for significant economic reform, Matthews Parks, Congress of South African Trade Unions (COSATU) Parliamentary Coordinator, made the following extraordinary statement: “Both environmental and economic denialism are dangerous and should not be entertained. We think we can and must tackle climate change and unemployment simultaneously. All it requires is creativity, political will, planning and resources.”

Until now, a recognition of the link between questions about climate crisis mitigation and other economic crises has largely been missing in African countries. Unions in particular have often been seen as the enemy of climate politics, especially in countries like South Africa which have large extractive industries and strong unions of miners and other workers. However, there has been a shift recently with more and more radical climate activists recognizing the necessity of getting unions on board. Unions on the other hand are also more frequently being convinced of the necessity of political projects like the Green New Deal, especially within the context of growing inequality and job losses.

South Africa has some not so-coveted titles: most unequal country in the world, 13th largest carbon emitter, and some of the highest rates of unemployment globally. Within this context, COSATU’s proposed interventions represent a flicker of hope in an otherwise dire picture for South Africa’s commitment to tackle both the triple threat of poverty, inequality, and unemployment, and the climate crisis. While the expanded proposition focuses on a range of struggling state-owned entities, the primary intervention relates to the dire situation at Eskom, the state-owned power utility.

COSATU’s “Key Eskom and Economic Interventions Proposals,” emphasizes that it is poor and working-class people who will bear the brunt of continued inaction, especially as talk of an IMF loan continues to percolate. The presentation calls for a commitment to concerted and urgent interventions in the economy before this month’s annual State of the Nation (by President Cyril Ramaphosa) and budget (by Finance Minister Tito Mboweni) speeches, on which a decision about whether to downgrade South Africa’s credit rating to so-called “junk status” are said to partly rest.

Under the banner of a “pro-worker Eskom turn-around strategy,” COSATU insists on guarantees that, amongst other things, Eskom will not be privatized, no worker will lose their job and major investments will be made into stimulating local industries, including the expansion of the use of renewable energy. In return, COSATU will support the use of funds from the Public Investment Corporation (PIC) which manages public assets including for the Government Employees Pension Fund (GEPF) and the Unemployment Insurance Fund (UIF). This will be done in order to bring Eskom’s debt down to the “manageable” R200 billion mark.

Likely speaking both figuratively and literally, Parks is quoted as saying:

The waters are rising. We’ve been keen to stop all this talking about a just transition and actually get things moving, so that we have it. We know we could lose whole sectors, we know we are facing a bloodbath, so we need government to use whatever sticks it’s got to force industry to look at just transitions for every sector of the economy, not only energy.

COSATU appears to be following this advice themselves, using the Eskom crisis as the linchpin for securing a pro-worker strategy and, for now at least, it may be working. The proposal is said to have garnered “wide-support” within the ANC’s highest decision-making body and reports indicate that a deal may have been struck by representatives from government, business, and labor following recent talks.

Understandably, there are skeptics. Many on the right responded with the usual fear mongering, presenting the move as an attempt to “loot” pensions. However, as is argued in detail by Dominic Brown, Economic Justice Program Manager at the Cape Town-based Alternative Information and Development Centre (AIDC), there is a sound economic foundation for expanding the investment profile of the PIC and using surpluses in both the GEPF and UIF to aid and develop state-owned entities as opposed to financing them out of the fiscus. This is especially when the latter option would deepen austerity limiting the potential for investment in social services and meeting infrastructure developments, thus threatening to further contract the economy.

While the developmental case for using PIC funds for entities like the state-owned airline South African Airways may be weaker, the importance of Eskom cannot be overstated. Eskom cannot be allowed to fail, but it needs major interventions both operationally and financially. Appropriately used, a massive investment into Eskom, which not only reduces its debt but also builds renewables and ensures financial security for workers in the coal mining sector would be highly beneficial.

Commentators regularly call for “structural reforms” in the South African economy with little attention given to what kind of structural problems need reforming. One of these is the fact that the post-apartheid era has been characterized by “high-profit, low-fixed investment.” This is linked to how processes of both deindustrialization and financialization have curtailed South Africa’s ability to expand employment, grow wages, and lift people out of poverty. The deeply unequal legacy of apartheid among other factors in South Africa’s political economy make these processes particularly brutal. COSATU’s proposal, carried out coherently and in line with the various conditions attached, could be a starting point to undoing this.

Getting support for this is not straightforward, and skepticism has not only come from the right. It has become increasingly difficult to counter distrust in the state given the depth and scale of corruption and inefficiencies that we are exposed to daily. Zwelinzima Vavi, General Secretary of COSATU’s rival federation, the leftist SAFTU (the South African Federation of Trade Unions), has warned about how the loss of legitimacy in public institutions has resulted in a bolstering of conservative forces to such an extent that even the working class can be mobilized to defend a conservative agenda. A recognition of the impact of State Capture is also evident in additional demands made by COSATU that relate to an audit of the public service and the removal and prosecution of corrupt individuals. The state’s loss of legitimacy represents a real and very present challenge for the left and it must be reckoned with. COSATU acknowledges this in the proposal introduction:

Not only must the Alliance and government defend the right of both the private and public sector workers to a living wage and labor protections but equally it is critical for the Alliance and government to defend the role of the state to deliver critical public services and goods, to participate in and to ensure competition in the economy. If not we face the real risk of the state being forced to retreat on all these fronts given the extent of the state and economic crises. This would leave workers exposed and unprotected.

COSATU’s alliance with the ANC (and the South African Communist Party) is regularly derided given the trajectory of the ruling party in the post-apartheid era. They have been criticized for not breaking with them over neoliberal reforms in the 1990s, nor during the State Capture period under former president Zuma. This in part led to the breakaway of a major union, NUMSA (the National Union of Metalworkers of South Africa), and the formation of SAFTU. While the federation is undoubtedly weakened as a result, they are still a major force in South African politics. Structural change at Eskom is almost impossible without them and thus their support for such proposals—akin to the start of a Green New Deal—goes a long way to shoring up support for these ideas within the country.

There are, however, important limitations that should be flagged. The links between the climate and economic crisis is far less explicit in the proposal than in the comments by Parks, and there are worrying references to the need to invest in “clean-coal,” which experience has shown is a dangerous misnomer. COSATU should be unequivocal in the demand for decarbonization while they continue to push for a deep and just transition for mining communities. The push back from those with vested interests in the fossil fuel industry, many from within the ANC and COSATU itself, will be strong and will require concerted struggle to counter.

Parks is right that this needs to cut across all sectors of the economy in order for a proposal of this sorts to radically change South Africa’s socioeconomic and emissions profiles. But, it also requires that this not be limited to only unions or the protection of the already-employed and unionized workers. Indeed, job creation and protection are necessary but not sufficient conditions to realizing real socioeconomic change in South Africa. Proposals to use the PIC and to link changes to a just transition have come about by civil society groups, like AIDC, working with unions to develop plans that are inclusive of worker’s needs. The same process needs to happen in broad alliance with groups like the Assembly of the Unemployed, housing rights movements like Reclaim the City, public transport activists like #UniteBehind, and crucially, groups like the Mining Affected Communities United in Action.

In her book, This Changes Everything, Canadian writer Naomi Klein makes the argument that the climate crisis, because it poses an almost existential threat, gives us points of leverage from which to force major changes. Parks himself seems aware of this: “Never let a good crisis go to waste,” he said.

Carilee Osborne is a researcher at the Institute for African Alternatives in Cape Town, South Africa.

Photo: Trevor Samson via World Bank, Flickr