Chairperson, comrades and friends, at the core of the second more radical phase of our transition is the need for a quality to the New Growth Path.
Of course, there are cyclical aspects to our poverty, unemployment and inequality challenges, but fundamentally our problems have deep, structural, historical roots. They are systemic and, in fact, they include many other things. The fact is that South Africa's economy is a semiperipheral economy that is subordinated to the global economy.
In the global division of labour, South Africa is essentially an exporter of primary products and an importer of value-added products.
Our recent growth, to the extent that we had it up to at least 2010, was fueled by debt and by the commodities boom which is obviously unsustainable. In fact, we now have very high levels of household debt.
Secondly, there is the dominance of the minerals-finance monopoly sector with a relatively underdeveloped manufacturing sector.
Thirdly, we have a highly monopolised economy with a historically underdeveloped small businesses and co-operatives sector.
Fourthly and more specifically, is the existence of a highly monopolised financial sector dominated by the four large banking oligopolies. Huge special inequality is yet a further structural constraint that must be addressed. Finally amongst many other things that we could have mentioned had the time been available, is a historically energy-intensive growth path based on mining with its exploitation of our natural resources and the damage it causes to our environment.
As an alliance document notes, these are key features and they are systemic in the sense that they are interrelated, interdependent and mutually self- enforcing. Because they are systemic, transformation in one aspect has to be linked with others as part of the overall strategy. We need a structural transformation of the economy as a whole. This is essentially what our second and more radical phase of the transition is about.
If you look at the DA, on the one hand, it basically refuses to acknowledge the fundamental structural roots of our problem. All of it is reduced subjectively to the ANC government as if any other government, if it were to come to power in 20 or so many years from now and face similar structural constraints, would be able to do any better. The EFF, on the other hand, pays mere lip service to structural constraints of the economy.
Now if you look at the DA, Mr Hill-Lewis in particular, we see essentially yet another form of what is a fundamental problem with the DA's approach. Their approach is that let the economy grow and that would automatically lead to job creation and the reduction of poverty and inequality.
Of course, growing the economy is crucial and we don't deny that, but it will not in itself lead to development. We need to focus on the quality and the character of the growth. We need to direct that growth sensibly in co- operation with the private sector, otherwise the poor and the disadvantaged will not benefit adequately. Tell us where in the world has the trickle- down policy that the DA has, served to benefit the poor proportionately?
In fact, a new Oxfam report says that by 2016, the richest 1% of the world will actually have half the world's wealth. In our country, given our huge inequalities such a trickle-down theory will never work. In fact, inequality reduces the prospects of economic growth, which is why we talk about the relationship between growth and development. Even Pope Francis, in November 2013, witheringly critiqued the trickle-down theory of the DA. He said, and I quote:
Some people continue to defend trickle-down theories which assume that economic growth, encouraged by the free market will inevitably succeed in bringing about greater justice and inclusiveness in the world.
This opinion which has never been confirmed by the facts, let me stress again - which has never been confirmed by the facts - expresses a crude and naive trust in the goodness of those wielding economic power and in the secret workings of the prevailing economic system. Meanwhile the excluded are still waiting, and they still wait, but they will not wait forever.
The question that also arises, interestingly, is: Is it because this Pope, unlike his predecessors, comes from Argentina, a country of the south? These theories that the DA supports may have some or other relevance in other parts of development that we don't know, but not for this country. And for all the claims about the government not allowing the private sector to grow and so on, it is interesting that since 1994, the major and significant gain for the poor and the disadvantaged is not private monopoly capital.
There has been a significant benefit. With the ending of the apartheid era sanctions, private monopoly capital has been able to dramatically increase its profit rate and increase its share of the growth domestic products, GDP, as against workers' wages. Interestingly, it failed significantly to reinvest profits into the productive economy in South Africa.
Mr Hill-Lewis, the member says ... [Interjections.] Hon Hill-Lewis. He is a member. Member Hill-Lewis says that Mr Patel made a whole lot of statements that are not valid. This occurred at the end of the first debate of the year. There was no reply from the DA on the second day of the debate. Slow thinkers as you are, you come with these replies now and it completely distorts what he said.
Fact one: He said that since Premier Zille took office, 181 000 more people are unemployed in the Western Cape. Instead, the DA confuses matters by drawing a distinction between narrow unemployment and broad unemployment. They then hang their argument on broad unemployment which includes discouraged work-seekers. But as Mr Patel said last Tuesday, the DA fared very poorly even by this standard.
When Premier Zille took over, there were 525 000 unemployed including discouraged work-seekers. Today, note there are 705 000 unemployed including discouraged work-seekers. In fact, these were precisely the figures used by Minister Patel because he used the very definition that the hon Hill-Lewis did in seeking to lecture us earlier today.
Fact two: Since Premier Zille took office, the employment rate in the Western Cape grew from 19,9% to 24,5%, almost 5% points higher under the DA. It also grew at a faster rate than the national rate, please note.
Fact three: Since Premier Zille took office, even where jobs were created most of them went to the whites.
Fact four: The DA is proud of the United Kingdom's growth rate. Let me tell you, in the past five years, the UK's average growth rate was 1,7% per annum and South Africa's was 2,4%. It's not the ANC that created the global financial crisis, but it is the people who identify with the markets in the way the DA does that are responsible for that.
Now, let's deal with the EFF. We are, and we must make it very clear that we commend to radical restructuring of the economy. But radicalism is not populism. The EFF needs to understand. In fact, structural change cannot be achieved overnight, but it is a painstaking process and it has to be sustainable to ensure real material gains - gains primarily for the poor and the disadvantaged and not the elites. Where is the substance in the EFF's policies? If you look at the December 2014 conference, there is an economic policy document.
Much of it indeed is a rehash of the ANC and the alliances' policies on the economy, but with several populist twists. Several proposals are, in fact, being implemented in some or other aspects of the implementation. A job- creating industrial policy - what's new? That has been done. A state-owned mining company - that's an original ANC position; beneficiation - that has been done and the President said it last week; skills development strategies; a stronger more development state; and a state pharmaceutical company - all of them have been done.
The EFF bleats on about how the ANC policies are responsive to their clever revolutionary policies. But it is the EFF that is responding to the ANC's policies. It is just that they give them a populist twist. Ultimately, what matters is the resolution that the EFF has passed. That's what counts. But all you have is a wish list.
Most of the wishes are fine. Many of us in the ANC can agree with many of them, but they are only wishes and have no content, no strategy, no programme. But Marxists are materialists and they shape their approach in large part by the material conditions of the time; by the balance of the forces both domestic and global; by an assessment of the resources; and by an understanding of the stance of the working class and its alliances [Interjections.]
What is Marxist about the wish list that you have adopted as EFF in your resolutions? You are idealists, and not materialists. There is nothing Marxist about you. You are basically populists. You are left in appearance, but right in substance.
What we are basically saying is that by pretending to be a Marxist you are an embarrassment to the party that I come from and its alliance. [Applause.] What is especially embarrassing, and I'm afraid the Minister is not here, is that some of you come from the very ranks of the SA Communist Party, SACP. If there is any lesson that we drew from you it is that we have to improve our political education programmes for those of you who came into our ranks. [Applause.]
Tell us, what is Marxist about the wish list? [Time expired.] [Applause.]