Connect with us

Politics

SAP – SEASON TWO: Who is driving civil service reform in Uganda? The people or the IMF?

13 min read.

Ugandans should be alarmed that issues settled in the 1990s are having to be revisited in 2018. By MARY SERUMAGA

Published

on

SAP - SEASON TWO: Who is driving civil service reform in Uganda? The people or the IMF?
Download PDFPrint Article

Two recent announcements made in Uganda recently create a sense of history repeating itself. The first, a plan to reduce the number of ministries, departments and agencies; 24 out of 29 agencies and authorities, regulating everything from road building to cotton and coffee development, will either be put back in parent ministries, merged with other authorities or abolished. Potential savings run to billions of shillings a year in salaries alone. The second edict followed a few weeks later; it was to freeze allowances payable to civil servants.

Both come against the background of broadening the tax base to increase revenue and are a repeat of similar measures under the Civil Service Reform Programme (CSRP) of 1992 to 1997. All three interventions are aimed at increasing resources available for loan servicing, service delivery and improving efficiency (in that order).

SAP II: Who are the drivers?

On the face of it, it looks as though the government is finally getting serious about improving service delivery. The president has been praised in offline and social media for these visionary interventions. Unfortunately, none of it is new. If anything, Ugandans should be alarmed that issues settled in the 1990s are having to be revisited in 2018. In 2018, as in 1992, the government is in negotiations with the International Monetary Fund (IMF) for bailout loans and it is the IMF driving the reforms.

Reduction of expenditure on administration is simply one conditionality of the new Structural Adjustment Programme (SAP II) as it was in SAP I. This should not be necessary in 2018, particularly because in the 1990s, the programme included a component called “Developing Establishment Control Mechanisms” that intended to keep the size and structure (i.e. the establishment) of the civil service affordable. Had those been effectively put in place, there would have been no crisis in the cost of the administration today.

THE NEW SCRAMBLE FOR EAST AFRICA: How rising debt and IMF loans have shielded kleptocrats and stunted human development in the region

Read also: THE NEW SCRAMBLE FOR EAST AFRICA: How rising debt and IMF loans have shielded kleptocrats and stunted human development in the region

In the first SAP programme, there was an attempt to bring the public on board. Programme components were made public, and privatization – the most controversial aspect of the programme – even had a strategic communications office that branded and shared information about the programme through mass media and drama.

In contrast, in 2018, when the National Resistance Movement (NRM) has exhausted the goodwill and patience of many, SAP II is being rolled out by stealth. A meeting on increasing the tax base was recently invaded by an activist demanding to know why she as a citizen was not privy to the decision-making.

Apart from the three interventions announced, the rest of SAP II remains a mystery. The nature and size of the financial package sought (new loan, rolled-over old loan or capitalisation of interest etc.) and the conditionalities Uganda has signed up for in order to qualify remain a secret. In other words, Ugandans don’t know how broke they are and how much more debt they are taking on and for how long.

Given the recent unprecedented but inevitable challenge to the NRM’s monopoly of political power by the People Power movement, what is certain is that Uganda’s development partners (DPs) will prepare for a successor regime willing to continue to carry illegitimate debt. Put another way, lenders will not accept a repudiation of loans wasted or stolen by the current regime, but will lend more money to cover the bad debts. The transition to this regime is known by a code called Rule of Law. The laws in question are those governing the enforcement of exploitative agreements with corrupt leaders.

Apart from the three interventions announced, the rest of SAP II remains a mystery. The nature and size of the financial package sought (new loan, rolled-over old loan or capitalisation of interest etc.) and the conditionalities Uganda has signed up for in order to qualify remain a secret. In other words, Ugandans don’t know how broke they are and how much more debt they are taking on and for how long.

At the same time, opposition to the economic crimes of the NRM government and demands for structural change is called “hooliganism”. The privileged few to whom the NRM regime has channeled economic opportunities are working overtime to project the violence of the state (all victims were either shot or bludgeoned) on unarmed demonstrators and innocent bystanders.

In their reluctant statements on the atrocities of August 2018, the UK and European Union called for the government and its victims – civil society – “to cooperate to ensure that the events that had caused suffering to Ugandan citizens and damaged the country’s global image were addressed swiftly and transparently with full respect for the Rule of Law”. The implication is that somehow the victims contributed to the attack.

All of this is underpinned by militarising public order. Repressive public order laws were first used to try and suffocate the independence movements of the 1940s and 50s. In the 21st century they are being implemented by a military trained and equipped to maim and kill supporters of the People Power movement. It seems civil disobedience as a means of political expression is not a privilege to be enjoyed by dollar-a-day people whose immunisation and ARVs are gifts from foreign governments.

This will be denied, of course. It will be pointed out that the United States withdrew support from the deadly Special Forces Command (SFC). But they didn’t uninstall the capacity for state terror. They withdrew after having created a killing machine.

The huge amounts spent on immunisation and ARVs will be given as evidence of goodwill. However, most people understand that the primary purpose of immunisation of livestock is not to change the outcome for the livestock (it will still be butchered) but to ensure that the farmer gets maximum economic benefit from it.

Nevertheless, the fall of the regime is a real possibility and its attempts to cling to power by increasing repression makes even tacit support by development partners increasingly untenable. Because repudiation of illegitimate debt is more likely to be successful following a Compaoré–style exit, all hands are on deck to frustrate the People Power movement that has the potential to bring it about sooner rather than later.

Alternative candidates to People Power are already positioning themselves for nomination as the leaders most likely to maintain the economic status quo. Their language of “conciliation” between the government and its victims and calls for Yoweri Museveni to casually apologise and announce a retirement plan minimise the latter’s culpability and indicate that should they take office, Museveni and his regime would not be held accountable for either economic crimes or the latest sustained wave of assaults, wounding and murder. They are playing for time while the new formation is crafted.

The risk is that by enabling Museveni’s government to continue the pretence of being in control of the economy, DPs are keeping Uganda in a holding pattern until they are ready to airdrop their preferred candidate in time for the 2021 elections. Those negotiations will be happening in background mode around about now.

Recent evidence of a concrete policy of impunity in exchange for continuity can be found in the DPs’ selective application of the law governing the type of international corruption that has brought Uganda’s economy to its knees. The decision not to charge Cheikh Gadio under the Foreign Corrupt Practices Act is, according to defence lawyer Robert Precht, “in part a political move – the US government wants to maintain good diplomatic relations with [its ally] Senegal.” The United States also wants to maintain diplomatic relations with Uganda, one of the two countries involved, and has declined to charge the Ugandan recipients of the bribes either.

The international media can be expected to continue doing its part by pitching for candidates on the basis of their “sophistication”, work and travel experience and general dining-at-Davos capabilities.

Meanwhile, SAP edition II announcements are being disguised as the head of state’s own initiatives. In a letter instructing his cabinet to reduce the number of agencies, Museveni asked, “Why have an agency when you have a department of government dealing with the same area of responsibility?” He conveniently forgot that these agencies were entities of his own creation in his system of patronage.

Agencies critical to Uganda’s economic health have suffered from the appointment of unqualified personnel, such as Jolly Kaguhangire, who with a certificate in secretarial work became an Assistant Commissioner in the Uganda Revenue Authority before moving up to be Executive Director of the Uganda Investment Authority. She was ousted only after staff, smothered by her relatives, petitioned the Ombudsman regarding her alleged “high level tribalism, mismanagement, corruption, favouritism [….]” In another example, Jolly Sabune, the permanent managing director of the Cotton Development Organisation, who failed in her mandate to add value to raw cotton, donated UGX500 million ($130,000) to political supporters of the regime and another UGX20 million (over $5,000 at today’s lower rates) of state funds to her brother’s wedding fund.

Meanwhile, SAP edition II announcements are being disguised as the head of state’s own initiatives. In a letter instructing his cabinet to reduce the number of agencies, Museveni asked, “Why have an agency when you have a department of government dealing with the same area of responsibility?” He conveniently forgot that these agencies were entities of his own creation in his system of patronage.

The proposed removal of over 100 government ministries and agencies is a re-run of the “downsizing” of the civil service in 1991/2. It was part of the SAP component called “Optimising the Size and the Structure of the Civil Service” that resulted in merged ministries, retrenchment and voluntary retirement. Mergers between ministries reduced the number of ministries from 38 to 22, and the staff complement was reduced by about half.

The new rightsized civil service was to benefit from pay rises on the smaller, more affordable payroll. Salary surveys of the private sector were done and comparable jobs in the civil service measured against them. It was decided that the gap would be closed by gradual salary enhancement. In preparation, allowances were to be monetised, i.e. allowances were to be abolished and replaced with a cash equivalent. Instead of a house, a public servant was entitled to a house allowance that he or she could use to rent a house or buy one on mortgage. Government houses were sold, with the sitting public servants given priority.

UGANDA: The Kennedy Doctrine – Matching Debt with Greed instead of Need

Read also: UGANDA: The Kennedy Doctrine – Matching Debt with Greed instead of Need

Other allowances, such as cars, were meant to be withdrawn and public servants’ salaries increased to a level allowing them to buy and insure their own personal vehicles on easy credit terms. Credit agencies supplied the numbers necessary to calculate a new pay scale.

Government pool cars were auctioned. (Pool cars were those available to a group of entitled staff for work purposes but which were usually monopolised by senior civil servants. In addition to those assigned to them, they commandeered the rest to ferry their children around and take relatives to and from hospital etc.)

Difficulties in implementation surfaced early on. There was a lack of commitment to the efficiency principle on which CSRP was built. The size of the government began to balloon. The number of ministries rose from 22 in 1997 to 75 today, plus the 29 agencies. The Ministry of Finance was detached from the Ministry of Planning and Economic Development before being merged again. Several of the statutory bodies slated for reabsorption in parent ministries have been cited for financial mismanagement in a number of Auditor General reports, meaning the expected efficiencies did not materialise.

There were two types of allowances: duty facilitating (needed to carry out the work e.g. transport for school inspectors) and remunerative (perks that went with the status of the job). The push-back against abolishing duty facilitating allowances was justified and successful but other allowances began to be reinstated. Ministers who had benefitted from the car purchase scheme became entitled to each subsequent scheme. The car ownership schemes themselves were very generous to the beneficiaries and a burden to the taxpayer.

Pool cars made a comeback and budget item 1010 (transport) reaffirmed its position as one of the most used and most frequently over-spent budget items. The unintended consequence of CSRP on transport was that civil servants at the top of the pay scale received higher salaries and subsidised vehicles yet continued to have access to pool cars fuelled and maintained by the state.

Salary enhancement did materialise for the most senior public servants as well as specialist staff. Doctors and the judiciary received considerable increases although their pay still remained well below private sector levels.

More specialised agencies and authorities were set up over the years with salaries at par with, if not greater than, private sector salary structures. While the agencies with their private-sector level salaries drained the Treasury, corruption in them outstripped levels in the traditional civil service. The Uganda National Roads Authority, the Uganda Revenue Authority, the Cotton Development Organisation, the National Environment Management Authority, and the new National Identification and Registration Authority are cases in point.

Teachers, on the other hand, are so numerous that salary enhancement for them was deemed impossible at the time. Years later, secondary school teachers were given a boost while primary school teachers’ pay remained below what is considered a living wage. However, the removal of ghost teachers from the payroll gave hope that genuine teachers would eventually receive meaningful salaries from the savings. The number of teachers’ strikes since then indicates that this has not been the case. At the time of writing, teachers in one district are on strike after a seven-month delay in their pay.

What went wrong? A number of things. First, the divestment procedure itself featured in numerous financial scandals. The accounts of the privatisation programme have never been published.

Privatisation was expected to reduce the amount the government was paying in subsidies to inefficient parastatals, such as the Uganda Electricity Board (UEB), thus freeing up revenue for service delivery. Since UEB was divested, however, subsidies to the electricity distribution company, Umeme, have been described as astronomical in Parliament and in fact exceed pre-privatisation levels in this sector.

The sale of other assets, such as government houses and vehicles, was similarly disappointing. In the meantime, health units, such as Kalisizo Hospital, are only able to attract 20 percent of the staff required. A mandatory transfer to such places is seen as equivalent to being homeless, there being no accommodation considered suitable by qualified personnel. For this reason, many newly refurbished rural health centres remained unused for lack of personnel.

Privatisation was expected to reduce the amount the government was paying in subsidies to inefficient parastatals, such as the Uganda Electricity Board (UEB), thus freeing up revenue for service delivery. Since UEB was divested, however, subsidies to the electricity distribution company, Umeme, have been described as astronomical in Parliament and in fact exceed pre-privatisation levels in this sector.

There are insufficient funds for salary enhancement and service delivery generally. Cash management on such a tight budget requires a degree of fiscal discipline that is impossible to maintain in a system of patronage.

Concluding his assessment of the CSRP of 1989–2001, Dr. Yasin Olum states:

“very little has so far been achieved due to the socio-economic and political state in which the country is in today. Issues such as public accountability, competence, and corruption are still high on the agenda. These and issues related to physical infrastructure have equally to be addressed.”

Since then, as documented by this writer in 2016, unsuccessful parts of the programme were re-done with poor results and high price tags. It is unfortunate, but World Bank internal assessments have falsified some reports to disguise failures and justify further lending.

The saga continues in 2018 with a new programme to repeat financial management capacity – building in local government, UgIFT (Uganda Intergovernmental Fiscal Transfers Programme), has been approved at a total cost of US$787.59 million in 2017. So far the World Bank has approved US$200 million. No wonder SAP must now go undercover.

The People Power movement gaining momentum in Uganda to fight the impact of these injustices is being vigorously fought by the NRM and its beneficiaries. The government is undermining resistance with a two-pronged approach. On the one hand, urban artisans, drivers and other workers and “ghetto youths” (of whom between 60 and 80 per cent are unemployed) who are the prime movers in the movement are being appeased with cash handouts. For instance, the first batch of traders along Entebbe Highway received a total of UGX180 million ($47,000) and a truck. Youths in Kamwokya, in the constituency of R. Kyagulanyi, the leader of the People Power movement, were given UGX100 million (over $26,000) to share. The following week, taxi operators and market vendors in the central business district received or were promised UGX3 billion ($800,000). During the six stops he made in the CBD, the president chided the traders for voting against the NRM in three mayoral elections and promised to take care of their financial needs from then on. Naturally, Ugandans outside central urban areas are beginning to demand a share in the bonanza.

The second prong is the militarisation of public order in anticipation of resistance to further economic outrages. A fourth announcement launched the ongoing nationwide recruitment drive of 24,000 youths for local defence units (LDUs). To understand the magnitude of this militia, compare it to the traditional Uganda Police Force establishment of 30,000.

LDUs are normally civilian patrols recruited by their neighbourhoods to carry out neighbourhood watch type tasks. However, the current drive has been launched and is being carried out by the military. According to Dr Kizza Besigye, the recruitment is a covert reinforcement of the Special Forces Command to be used to quell growing civil unrest. A creation of the NRM and the US government, the SFC has been responsible for most of the state brutality seen in recent years. It was established in the colonial era when Zanzibaris and Sudanese were used to subdue what became Uganda, that atrocities are more effectively carried out by people foreign to the area in which they are committed.

SHOCK THERAPY: The Rise of Russian Oligarchs (and why Kenya could end up like the former Soviet Union)

Read also: SHOCK THERAPY: The Rise of Russian Oligarchs (and why Kenya could end up like the former Soviet Union)

Dr Besigye’s suspicion is borne out by the fact that it is the military carrying out the recruitment exercise and not civilian local councils. It was the army commander who announced the arrangements. New LDU members will be paid UGX200,000 per month as compared to the UGX10,000 per month their civilian bosses, the chairmen of local defence councils, are entitled to. The new LDUs will cost a total of US$20 million a year.

Note also that the military, parliament and some agencies have not been paid for two months although the funds were released by the Ministry of Finance. Like the cash handouts to urban dwellers, expenditure on the new militia was not provided for in the budget.

Public planning, public audits and People Power

Looking forward, the Ugandan public can avoid repeating the errors of the past by demystifying public finance altogether. The people of Uganda can and must take charge of decisions on whether or not to enter into further debt. And it must be the people who decide what is an acceptable level of service delivery.

The service delivery cycle – budget planning-implemention-audit – can only be diligently overseen by those it is meant to serve. What the public is unaware of is that an Auditor General can only cover so much ground and so audits are done selectively. Targets for audits are picked according to the materiality (relative size) of the budget item in question, meaning that average-sized accounts can be plundered or wasted in a serial fashion as long as they are not caught by the auditor’s net. The relatively new value-for-money audits are separate from annual audits and occur as and when the Auditor General deems them fit or when ordered by parliament.

Looking forward, the Ugandan public can avoid repeating the errors of the past by demystifying public finance altogether. The people of Uganda can and must take charge of decisions on whether or not to enter into further debt. And it must be the people who decide what is an acceptable level of service delivery.

Parliament (to which the Auditor General reports) has been so compromised that it is no longer feasible to leave public financial management oversight exclusively to it. Elected representatives are becoming clients of the Executive as was seen when they received cash for votes, most recently to defeat opposition to the mobile money tax. Furthermore, some recently-dropped members of Parliament’s Public Accounts Committee were alleged to have sat on reports implicating officials in major financial scandals for the benefit of the perpetrators.

Monitoring the quality and quantity (value-for-money) of services also needs to be devolved. For example, Service Delivery Surveys (SDSs) introduced in the late 1990s were an intervention that seemed to have promise. The idea was that government departments would survey public perception of their service delivery and respond appropriately. Not being overly enthusiastic about monitoring themselves, it is no surprise that allowances for the survey personnel and other logistics are often not available. SDSs have not caught on as a regular part of the budget cycle.

Legislation for public audits would allow end-users of public services, citizens who have intimate knowledge of a particular government entity, to carry out their own audits where they suspect they are receiving inadequate value for money. It is such people-driven initiatives that will bring fundamental change to the quality of life of ordinary Ugandans.

Support The Elephant.

The Elephant is helping to build a truly public platform, while producing consistent, quality investigations, opinions and analysis. The Elephant cannot survive and grow without your participation. Now, more than ever, it is vital for The Elephant to reach as many people as possible.

Your support helps protect The Elephant's independence and it means we can continue keeping the democratic space free, open and robust. Every contribution, however big or small, is so valuable for our collective future.

Avatar
By

Mary Serumaga is a Ugandan essayist, graduated in Law from King's College, London, and attained an Msc in Intelligent Management Systems from the Southbank. Her work in civil service reform in East Africa lead to an interest in the nature of public service in Africa and the political influences under which it is delivered.

Politics

John Magufuli: The Death of a Denier-in-Chief

Late president John Magafuli never was the anti-corruption saviour international media claimed.

Published

on

John Magufuli: The Death of a Denier-in-Chief
Download PDFPrint Article

Tanzania, a country that produced Julius Nyerere, is a country tottering on the precipice of a pandemic catastrophe. The philosopher-president ruled for 23 years and put the nation on the international map as a frontline state that stood up to Apartheid South Africa and helped liberate modern Uganda by ridding it of Idi Amin.

With the abrupt death of its populist president John Magufuli on March 17, 2021, ostensibly from a COVID-19 related ailment, Tanzania finds itself at a crossroads, insofar as tackling the devasting disease is concerned. Magufuli who was the commander-in-chief of the armed forces, became the denier-in-chief of COVID-19. The disease has decimated scores of Tanzanians, including top government officials.

Magufuli was hailed as a tough anti-corruption crusader, as he entered state house in 2015. Ordinary Tanzanians initially saw him as their saviour in the fight against institutionalised state corruption. The international media also saw him as a man keen on tackling state corruption, “but Magufuli was all about optics,” said a Tanzanian journalist. “He wasn’t fighting state corruption pers se, what he was doing was to get rid of Jakaya Kikwete’s (immediate former president) networks in the government and replace with his own. So, it was just a matter of time before Tanzanians and the world realised Magufuli was just interested in musical chairs.”

Magufuli was re-elected on October 28, 2020 in one of the most controversial post-Nyerere’s Tanzania elections with a whopping 84 percent. His “true colours” revealed themselves after Benjamin Mkapa’s death in July 2020. After mourning the ex-president, Magufuli turned his attention to the business of crippling the opposition.

Magufuli was a protégé of Mkapa who served as president between 1995–2005. It was Mkapa, who in 2015, prevailed on the ruling Chama Cha Mapinduzi (CCM, ‘Party of the Revolution’) national executive council (NEC) to pick newcomer Magufuli as its flagbearer for what was to be a hotly contested general election in October 2015. Magufuli was then primed to run against Edward Lowassa, a CCM stalwart, who had bolted to Chama Cha Democrasia na Maendeleo (CHADEMA), after not clinching the CCM ticket, in which he was touted as one of the hot favourites.

The “true colours” was the ruthlessness with which Magufuli pursued the opposition in the lead-up to the presidential elections. That massive victory came in the backdrop of President Magufuli’s continuous campaigns since being inaugurated as the fifth president in 2015. “Magufuli never stopped campaigning,” said a Tanzanian journalist: “He rode on the wave of populism – dishing out money and favours to select supporters and well-choreographed individuals wherever he went.”

The 2020 Magufuli campaigns were a mirror-image of his mentor’s similar campaigns in 2000. Just like Mkapa’s mission was to presumably pulverize the nascent opposition, Magufuli’s mission 20 years later was similarly to ensure that the “irritating” opposition is no more and is, literary ran out of town. Mkapa in the October 2000 elections unleashed so much violence on the opposition that many of its supporters sought exile in neighbouring Kenya, after the elections.

Mkapa’s use of unmitigated force by Jeshi la Polisi (Tanzania has a police force, as opposed to a police service) and Field Force Unit (FFU), a paramilitary outfit much like Kenya’s dreaded General Service Unit (GSU) was unprecedented in Tanzanian politics. Just like Magufuli, it seems Mkapa’s “true colours” were revealed only after his mentor’s death the previous year on October 14, 1999. Mkapa was a protégé of the founding father Julius Kambarage Nyerere.

It was Nyerere who held Mkapa’s hand in 1995, after influencing his nomination by CCM, and single-handedly campaigned for him throughout the country. Tanzania held its first multiparty general elections in 1995, pitting CCM against a disparate opposition for the first time since its formation in 1977.

He dished out money and favours to select supporters.

Revisiting this unparalleled violence orchestrated on fellow Tanzanians, Mkapa, the former journalist-turned-diplomat-turned-president in his memoirs: My Life, My Purpose – A Tanzanian President Remembers published in January 2019, regretted the 2000 election ordeal. To some Tanzanian journalists and political analysts, Mkapa and Magufuli are today referred to as the chief advocates and perpetrators of state violence in post-independent Tanzania.

Both the presidential elections of 2000 and 2020 happened under a cloud of America’s own election problems: In 2000, it was the “Florida fiasco.” Florida was then governed by the Republican’s presidential candidate, George Bush’s brother, Jeb Bush. Bush was running against the Democratic Party’s Al Gore. Jeb was allegedly accused of rigging on behalf of his elder brother.

Like the Americans say, the electoral college vote was too close to call: the vote was not only going to determine who was going to be the winner of the states’s 25 votes, but the next president after Bill Clinton. A recount was called by the Democrats and for a brief moment, the democrats believed they had taken it, only for the Republicans to also ask for their own recount. Bush won with a razor thin win vote. The democrats were not persuaded. To cut a long story short, the sunshine state’s case found itself in the supreme court, where the republican-led court declared George Bush the eventual winner.

In 2020, with both the Tanzania and US elections being held days apart, America once again came under the world spotlight after the “Pennsylvania problem”, in which President Donald Trump claimed his votes had been tampered with and paid for a recount. The MAGA Republican Party candidate was defending his seat against “sleepy Joe” a derogatory tag given by Trump to Joe Biden.

The citing of both examples here is to emphasise that America in 2000 and 2020 could not claim a moral compass to the Tanzania government’s excesses in its elections. Covering the 2000 elections, I remember in Dar es Salaam, a CCM top official telling us journalists that America could not lecture Tanzania on matters election – “they should first deal with their own election rigging in Florida, before accusing us of unleashing violence and rigging the islands’ results.”

Nyerere had always been opposed to the twin islands of Pemba and Zanzibar’s divorce with the mainland Tanganyika – a sticking sore thump between the mainland and the islands, since the republic turned to plural politics. But he never advocated state violence, instead, he sued for dialogue and persuasion.

Magufuli was determined to put the opposition in its place this time round: In a parliament of 261 members, the opposition only won seven. “By the time I’m through with Tanzania, there’ll be no opposition in the country,” said the deceased in one of his campaign rallies.

There is not a doubt that he loathed the opposition, so much so that he warned the regional commissioners and election officials, “I don’t pay you so that you can allow opposition to win.” Tume la Uchaguzi (National Election Commission) flatly refused any presidential debates and told the opposition it could debate among itself if it so wished.

In Tanzania, CCM ni tasisi,” a local journalist reiterated to me. Literary it means the ruling party CCM is an institution. Figuratively it means, CCM is Tanzania and Tanzania is CCM. Anybody going against the “wishes of the party” would be crushed. The CCM’s propaganda machinery against the leading opposition figure Tundu Lissu of CHADEMA was geared to pulverize all his efforts of running a successful campaign. “He was being hunted down like a wild animal,” said the journalist.

Magufuli claimed Lissu was a supporter of LGBTQ and that he was a tool of the West being used to campaign for mashoga, homosexuals’ rights. Several African presidents during their re-election campaigns have turned the hot-button issue of LGBTQ, their favourite bogeyman: In the terribly conservative African societies, nothing evokes emotions of antipathy like suggesting gay-ism could be mainstreamed. Yoweri Museveni has done it, John Magufuli did it, just like Robert Mugabe did it before him.

CCM being Tanzania and Tanzania being CCM, not even the bravest of private media would dare report on the opposition or against Magufuli and CCM. “There was total blackout on the opposition by the media. All what Tanzanians could read and listen to, on politics, was on the ‘indefatigable Magu’ and his infrastructural developments,” said my Tanzanian journalist friend. Hence, Tanzania media did not report on politics – it reported on Magufuli, the person.

By the time I’m through with Tanzania, there’ll be no opposition in the country

Being heavy users of social media, Tanzanians turned to VPN – virtual private network. Found as an app in many smart phones, it protects one’s communication from snoopers like government agencies and hackers. What VPN does when activated is to bypass the conventional internet service providers (ISP) when connecting to the internet. In the case of Tanzania’s government shutting down its ISP, tech savvy Tanzanians resorted to VPN to access facebook and especially Twitter, to fend off the states’s eavesdropping.

This is the reason why Magufuli ordered all social media outlets shut, said the journalist. All what the Tanzania Communication Authority needed was a nod from Magufuli. A consumer of foreign news outlets, Tanzanians also resorted to BBC, Deutsche Welle (Sauti ya Ujerumani) and VOA, to stay informed on their country’s politics. “This is how many of them were informed and kept tabs on Lissu’s campaigns,” said the journalist.

Even after being sworn-in for the second term, President Magufuli pursued the browbeaten opposition. Chief opposition figure Lissu had to escape the country a second time. “Run or be run over, these people are not joking,” Lissu was ostensibly warned by his intelligence team. In September 2017, Lissu had survived an assassination attempt in Dodoma, that saw his vehicle sprayed with bullets by “unknown” assailants, as he left parliament for his house for lunch. On November 7, 10 days after the elections were over, he hid at the German embassy, then onwards to Brussels, where he had been recuperating for three years after treatment in Nairobi.

The former MP for Arusha Urban Godbless Lema also skipped the country and sought refuge in Kenya after claiming government people were after him. Lema, with his family was granted asylum in Canada.

Nyerere’s CCM may have operated in the one-party era during the cold war, but many Tanzanians of the post-independent generation remember those days with nostalgia. “The party was more democratic and free, unlike today,” said a former CCM mkereketwa (party diehard).

Magufuli’s populism was laced with autocratic tendencies. He told fellow Tanzanians msinijaribu mimi ni jiwe (don’t try me, I’m as tough as a rock), meaning he prided himself in being tough-headed.

“Magufuli’s CCM in the era of multiparty brooks no dissent, is dictatorial and dangerous, while Nyerere’s CCM preferred a palaver type of democracy where party issues were discussed until it arrived at a consensus,” said a University of Dar es Salaam don.

Continue Reading

Politics

South Africa: A New Politics From the Left?

Assuming today’s socioeconomic crisis benefits the Left is folly. That will only happen if we have the political vision to make class the fault line of social polarisation, and for that we need to face the challenge of constructing a new party.

Published

on

South Africa: A New Politics From the Left?
Download PDFPrint Article

Over the last decade, the Left in a number of Western countries has undergone a historic transition from “protest to politics,” to borrow the words of the late Canadian Marxist Leo Panitch and his frequent co-author Sam Gindin. From Podemos in Spain to Sanders in the United States, a new wave of parties and electoral coalitions have emerged and made rapid gains. Despite setbacks and defeats, Panitch and Gindin’s indispensable analysis of these events in The Socialist Challenge Today, casts them in an unambiguously positive light. None of the examples they study offer formulas for resolving the vexing dilemmas facing the socialist movement in our globalised present.

But in their determination to take state power seriously they constitute an unmistakable step forward, after decades in which the Left’s confinement to episodic instances of mobilisation left the electoral field wide open to the parties of business. Part of this “new new” Left’s success stems from a willingness to shake free of its own past. Building a viable socialism of the 21st century, they argue, requires dispensing with the outmoded parts of the Leninist model, like its wager on insurrection, while retaining that which still holds value, like its internationalist spirit.

These developments hold important lessons for us on the South African Left. Just under a decade ago it seemed that we were on the verge of effecting a similar transition “from protest to politics.” During the first decade and a half of democracy, a socialist opposition had found a locus in the so-called “new” social movements—like the Anti-Privatisation Forum—which grew in reaction to various parts of the ruling African National Congress’ neoliberal agenda.

These waged a number of important defensive struggles and scored a few key victories but fundamentally did nothing to loosen capital’s grip on policymaking. By the end of the 2000s most were a spent force. It became clear to a growing segment of the Left that lasting gains would not be achieved unless social agitation were more effectively linked with efforts to seise governing power. The ability to think these more ambitious terms received a major boost when the National Union of Metalworkers South Africa (NUMSA), the nation’s largest manufacturing union, appeared to redraw the political map of the country by breaking from the ANC, amidst a wave of working class militancy.

Of course for the “official” left which NUMSA represented there had never been any turn away from politics as such. But decades of compromise had bred a form of politics that had become completely unmoored from the guiding thread of class antagonism. NUMSA’s move thus constituted a kind of mirror image transition—from a back-room corporatism to a politics more grounded in the methods and spirit of “protest”. This is what imbued the “NUMSA moment” with such hope—it promised to re-connect the two sides of South Africa’s bifurcated Left, and supply the strategic elements that had been missing from each. By matching the militancy and class-independence of the social movement Left with structural and organisational might of the “official” Left, it seemed possible that a mass socialist movement could be rapidly brought into being.

That was not to be. From today’s vantage it’s impossible to regard the NUMSA moment as anything but an abject failure. The political party which eventually issued from it is the farthest cry from the unifying force that so many had hoped for. While the international left has been able to advance by breaking with its shibboleths, the Socialist Revolutionary Workers Party (SRWP) has fallen back on a slavish appropriation of Bolshevik ideology, almost comical in its extremes.

Despite enormous resources, a large part supplied by a US-based billionaire, the party ran a dismal general election campaign in 2019 where it failed to get even a tenth of NUMSA’s own membership to vote for it (it ultimately only amassed 25 000 votes nationally, below the threshold to obtain one seat in Parliament). It’s since never recovered, joining a host of other failed socialist parties on the margins of political life. Marginality seems in turn to have degraded the internal culture of the party, which now resembles closely the Stalinism of the ANC-aligned South African Communist Party in all its worst aspects.

The floundering of the NUMSA moment is a terrible blow. But the setback inflicted on us will far greater if we fail to draw the correct lessons from it. Perhaps the most worrying outcome is that it precipitates a slide back into movementism, and shuts the window that we’ve had to execute the transition from “protest to politics.” Party politics acquired a bad name during the era of “protest” in South Africa, and many on the Left already feel that the SRWP’s example vindicated their worst suspicions.

But what the SRWP actually reveals to us is are not flaws inherent in the party-form as such, so much as the limits of a certain kind of party, one founded on a hidebound Leninism. If the Left were to abandon party building altogether there would, quite simply, be no socialist future. All visions of radical change that eschew parties and an active takeover of the state suffer from a principal defect in that they misconceive the nature of class formation—the process by which individuals become aware of their class position and begin to articulate their politics through it. This is presented as a quasi-automatic effect of the capitalist class structure.

But history offers no support for such a view. Class is impactful because it frames the options we have over so many major decisions in our lives—but not so narrowly as to make resistance to one’s employer, or the system behind him, inevitable. Indeed, the extreme vulnerability of workers under capitalism means that individualised modes of coping tend to be more commonplace than collective action. That’s why socialist consciousness has been the exception rather than the norm in the global history of capitalism, and exceedingly rare in the absence of a well-organised party. As Panitch argued with the force of a life’s work—parties make classes as much as they are made by them.

Thankfully, an outright repudiation of the party-form is not really where we are at in South Africa. The variant of movementism which took hold here, and which has revived in the aftermath of the NUMSA moment, was not really this more extreme kind, which denies the ultimate need for a party. Rather what it advocates is a downgrading of the role of party building or its deferral to some indefinite future.

What seems to be the common premise for this position is that party building can only succeed when perfectly timed to the right “objective conditions” —conditions which are only likely to form in the wake of a rupture moment defined by intensified street-level mobilisation. Only the transformation of mass consciousness brought about by such an episode of struggle can furnish the base for a party. Moreover, efforts to “impose” a party on the working class before this are liable to be rejected by its most conscious and active layers. Cut off from nourishing energy of grassroots movements, they are likely to grow in authoritarian directions. The task of socialists in the present, therefore, is devote ourselves to strengthening movements, and hope that a party may gestate from within them in some future context.

Related but distinguishable from this, is an ingrained hostility on the South African Left towards electoral politics. This view tends to draw a sharp line between the electoral arena and movements. While movements unlock popular power by sensitising their participants to their potential for collective action, elections offer no such platform for consciousness-raising. Instead, they tend to reproduce the atomisation of liberal democracy, and to fortify the myth that progress is possible within it. Moreover, movements which take the electoral road subject themselves to debilitating pressures. The logic of getting the vote tends to conflict with the logic of grassroot mobilisation, and all too often to overwhelm it.

Movementist positions contain many insights. It is wise, for example, to be attuned to the importance of ruptural breaks—the likelihood that we will ever get to a mass party simply through a molecular accretion of our ranks is slim. But the contention that movement building alone is the best way to prepare for such a rupture fails to take seriously the inherent weaknesses of social movements.

Of the numerous movements which sustained the first era of “protest” in post-Apartheid South Africa virtually none remain (barring one major exception). New ones have of course cropped up, and a tide of less organised community protests has continued unabated across the country. But these show equally little likelihood of autonomously cohering into anything bigger or more resilient.

It’s now very hard to avoid the conclusion that their failures resulted from internal rather than external factors. The model underpinning them rested on localised mobilisation around immediate demands, while actively eschewing efforts to politicise a leadership layer. Some of their more excitable proponents portrayed them as crucibles of anti-capitalism, in which the mere experience of collective decision making offered a form of political education beyond what traditional forms of Left organisation could hope to match.

But in doing so they exhibited the same fallacious thinking about class formation that informs all ventures aimed at “changing the world without taking power.” Much less a break with capitalism, it’s not clear that social movements even succeeded in getting most of their members to question their loyalty to the ANC. That left them prone to demobilisation and disorganisation when circumstances changed, when defeats where incurred or when key individuals drifted off or were co-opted.

One strategic upshot of this critique is that the trade-off between movement and party building posited by movementists is a false one. It’s likely that there is no winning formula for transforming single issue mobilisations into lasting, mass organisations without NGOifying them. But what we can do is to ensure that the small advances made by movements each time they arise are not dissipated. After all—the notion that struggle develops consciousness is not a false, what movementists get wrong is overstating the extent to which it does so organically. Virtually every movement throws up militant leaders, who stand to become tribunes for socialist politics if they can be identified, recruited and supported appropriately. This is work that a party is best suited to undertake.

But facing up to the limits of social movements should lead us to even stronger conclusions than this. It should lead us to question the overwhelming strategic significance that they have been accorded in the politics of the “independent left.” If movements are tough to sustain and to politicise, they may not be the vehicles best suited to bringing about a political rupture or ensuring that it outcome favors the Left.

Of course this was a strategic orientation that was largely foisted on us by circumstance. The stranglehold that the Tripartite Alliance (whose third member is the Congress of South African Trade Unions) exercised on organised labour and mass politics generally left little room for an alternative. But the situation has changed. The factionalisation of the ANC, the split in COSATU and the emergence of its rival, the South African Federation of Trade Unions, have created an opening for a more militant socialism to regain a foothold in organised labour. This ought to be the clear priority of socialists.

For all its infirmities, the union movement still presents a much more promising site for grounding socialist politics in a mass base. Although this may not hold for much longer, unions remain mass membership organisations with considerable resources. Most importantly, and most differently from social movements, they have access to structural power (i.e, the power to withdraw labour and shut down the economy). Here is one insight of Leninism which time has not invalidated– that our project will most likely fail unless that structural power is at its center.

If organised labour is once again to become our strategic focal point, this strengthens the case for not consigning the party to an intangible future. The synergies between party-building and organisation building are arguably stronger in the case of unions than social movements. At a fairly abstract level, one reason for this is that union building (or revitalisation) typically relies on a few individuals being prepared to take bold action out of moral conviction. Marxists have often argued something very different—that shopfloors collectivise as soon as workers wake up to their material interests. But narrow self-interest is unlikely to ever motivate someone to take the first steps towards organising their co-workers, since doing so incurs enormous risks but yields no extra benefit—the essence of the “free-rider” problem.

Thus, it’s not a coincidence that so often in history, socialists of various stripes have been significantly overrepresented among the “militant minority.” The values that draw people to the banner of socialism are often the same as those that move them to action against workplace injustices. It’s also not a coincidence that a militant minority is more likely to take shape when socialist ideas are more prominent in the public realm.

Arresting the decline of South African unions, and returning them to their proud history of worker control and grassroots democracy will require a herculean organising effort. At the simplest level this is why we need an organisational vehicle that at  least broadly resembles a party. Without one we have no real means of translating strategic debates into action—of coordinating our energies towards the tasks most likely to yield long-term gains.

There’s therefore a case for not delaying in building a fighting organisation, that tries to cohere leading militants from workplace and community struggles around a socialist program. But such an organisation should do more. As soon as it has the numbers needed, it should seek to involve itself in elections. In all likelihood it would have to start at the local level, and logic would dictate that it seeks out community and social movement partners in doing so. But as quickly as possible is should seek to graduate to the national stage. South Africa’s unusually proportional representation electoral system (which was in fact designed to provide space for smaller parties), makes this a reasonable short-term goal.

Arresting the decline of South African unions, and returning them to their proud history of worker control and grassroots democracy will require a herculean organising effort. At the simplest level this is why we need an organisational vehicle that at least broadly resembles a party.

The first thing that sceptics of this strategy tend to get wrong is that they overstate, or misunderstand, the legitimacy problem facing formal political institutions. The SRWP seems to think that any worker with lingering attachments to electoral politics is suffering from “false consciousness.” But in our current circumstances, there is nothing the least bit irrational about remaining invested in the electoral arena, even while recognising the severity of its class bias. The simple reason for that, is that there is no existing social force capable of challenging state power while remaining entirely outside its institutions, nor does one show any prospect of coming into being in any foreseeable horison. Worker organisations in SA are locked a desperate defensive struggle—not preparing to set up a parallel state.

It’s not a failure of dialectical imagination that causes people to conflate politics with elections, but an appraisal of our situation that is more accurate than the one provided by the apostles of imminent revolution.

It’s thus not surprising that despite the tremendous alienation produced by decades of neoliberalism, electoral movements in the West have been able to engineer a political realignment that was much deeper than what post-2008 movements were able to achieve on their own. Their location within the domain of mainstream politics provided both visibility but also a kind of credibility—they promised to take over the institutions in front of us, rather than replace them with ones we can’t see and can’t yet imagine. Several of these examples stood the movementist model on its head. Rather than an electoral breakthrough growing out of a period of intensified movement activity, it was the electoral arena itself that has delivered the rupture moment, the energy from which can then be filtered down to social and labour struggles.

In the process they challenged another fallacy of movementism—that the electoral arena is entirely inimical to a politics of struggle. Sanders, Corbyn, and others imbued their campaigns with a spirit of insurgency that succeeded in appealing to many otherwise turned off by politics, particularly among younger generations. Rather than sucking energy from the streets, these examples provided a renewed model of “class struggle elections” —not their own invention but one that had faded from the Left’s repertoire during the era of movementism.

Class struggle elections seek to deliberately leverage electoral campaigns, and political office itself, to bolster movements. They use every platform available to raise awareness of, and encourage solidarity with, labour and social struggles. In doing so they try to inculcate the understanding that radical policies can only be won with an inside-outside strategy, in which legislators are supported and pushed forward by powerful movements. At the same time they use campaigns as tools of organisation building.

They recruit and deploy a mass of activist to spread a socialist message, and simultaneously try to develop those activists by building political education into their activities. Done properly, this can bridge the gaps that supposedly separate movement from electoral organising, infusing the latter with a powerful sense of collectivity. That’s why so many thousands of young Americans (to pick a recent example), were politically activated through their involvement in the Sanders campaign, which became a gateway to organising in their workplaces, campuses and communities.

Note that this is completely different to the SRWP’s narrowly propagandistic approach to elections which didn’t promote social struggles so much as fantasies of revolution, whilst denouncing ‘bourgeois democracy’ as a sham and doing nothing to actually win. After a predictably disastrous outcome, the party chose to compound the embarrassment, and feed into a profoundly dangerous trend by denouncing South Africa’s independent election management body and claiming the result was rigged.

It’s not a failure of dialectical imagination that causes people to conflate politics with elections, but an appraisal of our situation that is more accurate than the one provided by the apostles of imminent revolution.

Contrast its subsequent marginalisation with the early trajectory with the Economic Freedom Fighters (now South Africa’s third-largest party), which leveraged the electoral know-how of its ex-ANCYL cadre and Malema’s media savvy to run an enormously successful first campaign. It then built on the success, steadily expanding its vote share each cycle, while using parliamentary office to bolster its national profile. Sadly it drifted off the orbit of the Left along the way. But the two diverging cases provide an obvious lesson: if elections are to be useful to us, we have to show that we are capable of succeeding in them. If we can’t, how on earth will we convince anyone that we’re capable of transforming society from its roots up?

None of this is to suggest that the concerns movementists raise about electoral politics are meritless. Its unquestionably true that electoral competition imposes its own logic, which can be ruinous if it totally subsumes the party’s strategic purview. We can trace the decline of many a worker’s party, at least proximately, to misguided efforts to capture middle-class votes by abandoning a politics of class antagonism. But all socialist strategising in our dismal conjuncture is the consideration of perilous alternatives. Far better for us to confront the dangers of succumbing to a narrow electoralism than the near certitude of permanent marginalisation should we choose to abstain from mainstream politics altogether.

The NUMSA moment may have come and gone. But the many elements of the broader conjuncture which produced it, and which seemed to augur a new direction for socialist politics, persist. The Alliance coalition is in the doldrums. Expecting its inevitable demise is of course a pastime of which we “independent leftists” should now be wary. But the material facts this time really are different. The state faces a fiscal crisis that President Cyril Ramaphosa has neither the wherewithal nor the institutional tools to escape from. His factional opponents preach a “radical economic transformation” that offers nothing whatsoever to workers.

Social strains look set to keep accumulating. But assuming that any crisis they produce will automatically redound to the Left’s benefit would be folly. That will only happen if we have the political vision and the organisational capacity to ensure that class becomes the fault line of social polarisation. And for that we need to face up to the challenge of constructing a new party.

Continue Reading

Politics

Is a Plutocratic America in Terminal Decline?

We may not be aware of it yet, because of the hold the nation has on global media, but America’s decline appears to be terminal.

Published

on

Is a Plutocratic America in Terminal Decline?
Download PDFPrint Article

As President Joe Biden begins to get comfortable in the White House, there are those who might say that America, under a democratic system of government, has once again allowed the voice of her people to be heard, and that they have elected a new leader into office. Some might go so far as to say that the world’s most affluent democracy has once again proved that government of the people, by the people, for the people is alive and well.

But just below the surface, there are questions deserving of a deeper examination. One is how narrow the margins of victory were. For while it is true that President Biden won the highest number of votes in American electoral history, it is also true that President Trump won the second-highest number of votes in American electoral history; 10 million more people voted for President Trump in 2020 than did so in 2016. Mr Biden’s margin of victory in Georgia was 0.48 per cent, while that in Arizona was 0.63 per cent. Further, even as the Democrats belatedly won a majority in the Senate, again by the finest of margins, the Democratic majority in the House of Representatives actually narrowed. Why, if the choice was so clear, were margins so narrow?

The regrettable truth is that the US is not a democracy – not merely because true democracy has never existed, but because even that imperfect form of democracy that characterises modern politics long perished in America. The United States today is in fact a corporatocracy; mega-corporations rule the country, a polite way of saying that that nation is now a plutocracy. This development is not really new – wealth has always, eventually, determined leadership, in America and elsewhere.

This article attempts – colossally log-in-eye, and at a distance of thousands of miles, admittedly – to furnish proof of the existence of this plutocracy; to demonstrate the effects of this plutocracy on American life and politics; and to establish whether there is any way out of the present morass.

That America is a plutocracy

A total of US$14 billion (KSh1.4 trillion) was spent on campaigns in the US this year, twice as much as in 2016. Where is this money coming from?

In 2010, the US Supreme Court handed down a decision called Citizens United that allowed unions, corporations and associations to spend unlimited amounts in elections provided they would not coordinate their efforts with a candidate. As a result, political action committees (or PACs – private organisations established to raise money in support of a candidate or an issue) morphed into Super PACs that could receive unlimited amounts of money for campaign purposes. The effect was immediate: in 2012 non-party outside spending tripled 2008’s total and topped US$1 billion for the first time. Of that amount, Super PACs spent more than US$840 million.

The regrettable truth is that the US is not a democracy.

Yet the amounts spent in 2012 pale in comparison with spending during the 2020 campaign; in October 2020 alone, outside spending by super PACs and other big-money groups totalled nearly US$1.2 billion. President Joe Biden alone raised US$1.6 billion. President Trump raised US$596 million, itself a significant haul. Given the closely fought nature of the presidential election, it would not be wrong to conclude that money helped tip the scales in favour of the new president. Nor was this true only of the presidential race; it was true across the ballot. Eighty-nine per cent of House races and 71 per cent of Senate races were won by the better financed candidate. The conclusion is clear: money – corporate money – wins American elections.

The effects of the plutocracy on American life

It is all very well and good to conclude that corporate money runs and wins American elections. The issue is what the effect of all this money is on American life. If corporate hegemony is harmless – even beneficial – arguments can be made that it should be left alone. If it is not, however, then that fact should be exposed, and reform commenced.

The American mega-corporation has achieved a number of victories (from a corporate standpoint) that have constituted assaults on the wellbeing of the American people and populace. For example, these corporations have been allowed to outsource American manufacturing jobs to China and other nations. The iPhone, signature product of America’s second largest company by market valuation (Apple), is assembled in Shenzhen. Nike began outsourcing manufacturing in the 1970s; today it has plants in Vietnam and South Korea as well as China. IBM now has more workers in India than in the US. As of April 2012, Walmart’s supply chain included some 30,000 Chinese factories, producing an estimated 70 per cent of all of the goods it sells. This trend has gone on so long that there now exists a portion of the northeastern US, formerly known as the Manufacturing/Steel/Factory Belt, that is now known as the Rust Belt, owing to industrial and economic decline occasioned by outsourcing and the automation of jobs.

Meanwhile, for those jobs that have escaped being shipped overseas, the average wage has been stagnant for 40 years. A generation has now arisen in America that will be the first in modern American history to end up poorer than their parents. To make up for stagnant incomes, American citizens are drowning in private debt (US$14 trillion worth) including mortgages (US$9.44 trillion) and student loans (US$1.5 trillion). Indeed, absolute US household debt was higher in November 2019 than prior to/during the great recession, although the debt-to-income levels during the great recession were higher than the 2019 levels (83 per cent to 73 per cent). High house prices, supported as they are by mortgage lending, coupled with student loans, together mean that new graduates are experiencing “failure to launch”, i.e. the inability to leave one’s parents’ home and start one’s own family.

(We should pause here to note, parenthetically, that the level of any nation’s private debt, and America’s in particular, is a very important metric. The level of private debt was the key indicator that enabled Professor Steve Keen, one of the Bezemer 12, to predict the North Atlantic financial crisis of 2007-8, a prediction mainstream/neoclassical economics, quite criminally, failed to make.)

The US$14 trillion of private debt that American citizens owe is owed to the very same mega-corporation class whose wage stagnation has necessitated the need for lending (since the early 1970s, the hourly inflation-adjusted wages received by the typical worker have barely risen, growing only 0.2 per cent per year). Most unfortunately, this wage stagnation is not uniform: the ratio of CEO-to-worker earnings has soared from 21-to-1 in 1965 to 320-to-1 in 2019.

A generation has now arisen in America that will be the first in modern American history to end up poorer than their parents.

Has the American mega-corporation been censured by the political class for these excesses? Hardly. In fact, the large American corporation, while using American infrastructure, using some degree of American labour and selling to Americans, is allowed to pretend that it operates outside America, by invoicing from nations with low tax rates, such as Ireland, thereby avoiding paying federal taxes on its income. From 2009-2018, for example, Amazon paid an effective federal tax rate of 3 per cent on profits totalling US$26.5 billion. In 2018 alone, the company received a tax relief of US$129 million dollars on profits of US$11.2 billion. Such is the scale of tax avoidance by American corporations that by 2016 a staggering US$2 trillion in untaxed corporate profits was stashed outside the US, according to the New York Times. (What makes this doubly lamentable is that the Internal Revenue Service tells the American citizen in unambiguous terms that “Your worldwide income is subject to U.S. income tax, regardless of where you reside.”)

Corporations, therefore, enjoy egregious advantages. It is in order to keep them that they are so willing to fund political campaigns. In other words, corporations will do everything to avoid paying the taxes that would improve American infrastructure and healthcare (to their own benefit) but spend billions on political campaigns to inoculate themselves from losing the unfair advantages they have carved out for themselves.

The effect of the plutocracy on American politics

The shock election of President Donald Trump in 2016 can be seen as a response to the deleterious effects of corporate hegemony on the American political and economic life. Candidate Trump campaigned as an outsider, promising to “drain the swamp”, even though, ironically, he was himself a self-styled billionaire who shipped jobs to China and paid very little in taxes. America was suffering economically. He claimed that the blame for this could be placed squarely on the shoulders of China and immigrants. In an illuminating two-part, three-and-a-half hour 2019 interview with PBS, key Trump campaign advisor Steve Bannon (who was arrested for fraud and then pardoned by President Trump on his last full day in office) stated that the cost of the 2008-09 bailout was loaded onto the American middle class, and that American gig economy millennials are nothing but 19th-century Russian serfs. Many may disagree with Mr Bannon’s political views, but his statement had its finger on the pulse of post-bank-bailout America. The genius of the Trump campaign was its ability to identify these pain points; to incorrectly but convincingly blame foreigners – locally (immigrants) and abroad (China) – for what were and continue to be the excesses of the plutocracy; to identify the existence of a swamp in Washington and characterise Hillary Clinton as the personification of these ills; and to ride that wave all the way to the White House. The lesson – a lesson seemingly yet unlearned by mainstream politics – is that it actually worked.

Candidates however, campaign in poetry; rulers, on the other hand, govern in prose. During Trump’s presidency Faustian bargains, in Steve Bannon’s words, were made; here again the power of the corporatocracy made itself felt. One of the early indicators of the direction and tenor a presidency will take is a president’s cabinet picks; Steven Mnuchin, yet another ex-Wall Street executive, was placed in charge of the Treasury. While President Trump did not drag the US into another war – in spite of the assassination of Iranian Major-General Qassim Soleimani – his presidency did not up-end Washington in ways meaningful to the nation’s citizenry. Readers may recall the US$2 trillion of untaxed corporate profits mentioned earlier; President Trump’s signature legislative achievement was to open new windows for tax rebates for major corporations, reducing taxes on the wealthy. This legislation resulted in the repatriation of US$777 billion in 2018, but the Federal Reserve noted that “the strongest effect of repatriation was on share buybacks” by corporate America. This particular episode is a textbook example of the plutocracy at work.

Trump does not greatly differ in this way from the way in which Candidate Obama contrasts with President Obama. Candidate Obama campaigned on Change We Can Believe In. Yet, once elected, he bailed out the banks (the abiding question on this, some wonder, is why citizens did not retain their houses if the banks’ losses were made good). Obamacare, a very significant advance in the fight for decent healthcare for Americans, did not include a public option although it could have. Nor did President Obama succeed in extricating himself from American warmongering abroad: in a particularly sad and tragic episode he helped end the Libya Gaddaffi had created. Libya under Gaddaffi was a nation that had free university education, free healthcare, no external debt and reserves of US$150 billion – all ideals that America, ironically, declares it wants but has yet to achieve despite its claim to being the richest nation in history. Allied “intervention” replaced that Libya with today’s bombed-out nation, in which incessant internecine strife went on for a decade. This in Africa, the land of Obama’s fathers. Only two years previously, at a location just two hours from Benghazi by air, the new President had given his “A New Beginning” speech in Cairo, which speech contributed to his winning the Nobel Peace Prize later that year.

In these two presidencies, we see, microcosmically, the effects of the plutocracy at work: the lofty ideals of the campaigning candidate and the searing needs of the masses, once office is assumed, are replaced by a kind of neutered, ineffective pragmatism, as far as the wellbeing of American citizens is concerned, and a sly and insidious effectiveness where corporate welfare is concerned.

The 2020 campaign

Perhaps the defining characteristic of the 2020 campaign is that it took place against the backdrop of a global pandemic. The cost of this pandemic – in the gruesome currency of American lives – has been more than 500,000 dead Americans and counting, nearly 10 times the number of US soldiers who died in the Vietnam War, and more than the number of American lives lost in World War II.

Uniquely among developed nations, the structure of America’s healthcare system is such that very often one only has healthcare if one is employed. So that when 44 million Americans filed for unemployment during the pandemic, they lost their medical cover at precisely the time they most needed it. The pandemic therefore threw into sharp focus the critical importance of having a healthcare system that is not based upon employment.

(Nor is the state of health insurance all that is wrong with American healthcare – in several tragic articles it has been reported that American diabetics have been driving to Canada in caravans to buy insulin – some driving up to 5 hours one way. Price-gouging by pharmaceutical companies means that the drug is ten times cheaper in Canada than it is in America.)

The bipartisan response to the pandemic was to pass the Coronavirus Aid, Relief, and Economic Security (CARES) Act that – while it gave individuals with less than US$99,000 a year annual income a check of US$1,200 a month – also gave further tax cuts to the wealthy. According to the nonpartisan Joint Committee on Taxation, just 43,000 individual tax filers covered by one of the Act’s provisions would see their tax liability fall by a combined US$70.3 billion in 2020 (or about US$1.7 million each). This is the America that corporatism has created.

And yet, mid-pandemic, was healthcare on the national ballot? How, when pharmaceutical and health product industries have spent a total of US$4.7 billion on lobbying the federal government, US$877 million on state candidates and committees, and US$414 million in the 20 years to 2018? Indeed, by the time he won the nomination, Joe Biden had already said he would veto a Medicare for All bill if it landed on his desk (a colossal if, it must be said), proposing a public option instead.

So what was on the ballot? Democrats, choosing to characterise Trump’s presidency as the problem, instead of seeing it as the natural consequence of the decades of wage stagnation, high healthcare costs, inordinately high levels of private debt, etc., campaigned on the platform of “restoring the soul of America”. The president’s narrow margins of victory perhaps find an explanation here: the problems Americans face were not really on the ballot. And they were not on the ballot because the corporations that stump up the money to fund electoral campaigns benefit from providing privatised solutions to the problems Americans face.

Is there hope?

There is an American constituency that is in broad agreement on the issues raised above: a Fox News exit poll, for example, showed that 72 per cent of Americans were at least somewhat in favour of changing to a government-run healthcare plan. Florida, a state President Trump won, voted to increase the state’s minimum wage to US$15 an hour.

However, it is unlikely that this broad constituency will be allowed to unite under the current political system. The reality is that the US is a de facto one-party state. If that party were to be honestly named, it might be named the Megacorp Party, or, slightly more genteelly, the Corporatist/Establishment Party. It has two wings: a supposedly left-leaning Democratic wing and a supposedly conservative Republican wing. Under the framework of Citizens United these two wings will continue to swap power ad infinitum. Yet, even as the presidency bounces from party to party, a president from one party will bomb Iraq; the next president, from the other party, will campaign on the platform that he never voted to go to war in Iraq, only to subsequently bomb Libya. These tragic contradictions find their resolution in the fact that this war activity happens at the behest of the military-industrial complex.

Political consultants will keep finding new, misleading ways of “framing the political argument,” creating false choices and developing narratives such as restoring the soul of the nation. Meanwhile, the money that pays them will continue to fortify itself against the needs of the people; the rich will get richer, the poor will get poorer and power will remain with the wealthy.

As long as this continues, we can expect two outcomes. The first is that the issues that Americans need solved will not be solved. (We are now reading, for example, that the US$15 dollars/hour minimum wage President Biden promised (during a presidential debate), is unlikely be included in the US$1.9 trillion-dollar stimulus package President Biden intends to bring to Congress.) The second is that, as a result of the failure to resolve these issues, America will, in the words of Robert Reich, continue to produce candidatures like Donald Trump’s as far as the eye can see. The American political system does not contain within itself the mechanism to correct the current malaise. As a result, money will continue to win out: it will continue to select which issues are on the ballot, and it will continue to choose which candidates win. America’s long decline, therefore, is likely to continue.

The corporations that stump up the money to fund electoral campaigns benefit from providing privatised solutions to the problems Americans face.

We may not be aware of it yet, because of the hold the nation has on global media (the concentration of media ownership in America is yet another triumph of the plutocracy), but America’s decline appears to be terminal.

I return to the beginning – this article is written colossally log-in-eye. As a Kenyan I know we have major, pressing domestic issues to resolve. If or as we make a detour to examine the American political situation, let our contemplation resemble our use of a mirror, and let our aims be those of helping us to avoid the problems others have experienced, in order to more wisely and speedily resolve our own.

Continue Reading

Trending