Draft paper from the conference Collective Memory and Present day Politics in South Africa and the Nordic Countries. Conference of Historians, Africanists and Development Researchers, Copenhagen 22-23 August 2002.

 Programme, report, photos, and other papers from the conference

The discussion of the relationship between capitalism and apartheid: elaborations over Lipton and Yudelman

By Hans Erik Stolten, the Nordic Africa Institute, Uppsala, Sweden.

 

 

For at least 25 years, from the end of the 1960s to the early 1990s, there were in South African historiography two fairly clearly definable, mutually diverging main viewpoints of the relationship between capitalism and apartheid, and their presence can still be sensed in new influential works of history.

The racial revisionist viewpoint has attempted to prove that apartheid was created by and served the capitalist interests that enjoyed an abundance of forced cheap labour, and that this can be shown in studies of the rapid successful growth in the South African economy during most of this century.

The liberal viewpoint has assumed that apartheid is the result of racist sentiments, particularly among Afrikaner nationalists, who from a political standpoint have been the dominant power factor during most of the period since the union of South Africa in 1910, and that the system, on the contrary, has impaired economic growth.

I have been rereading two works from the late 1980s published at a very decisive point in history and dealing with this debate. I think that the problems they raise deserve to be taken up again in a time where the politics of the new regime accepts growing social gaps and problems of poverty. In contradiction to many former radical intellectuals, who have long ago given up fighting for lost cases, it seems impossible for me to get past this principal debate.

The question of whether capitalism was the reason for raw social repression along race lines for most of last century, or if capitalism in fact liberated South Africa from outdated political apartheid, still has great implications for strategies for social struggle, political choices of economic policy, possibilities of reconciliation etc.

 

Business world attitudes towards apartheid - Merle Lipton's analysis

One of the most outstanding and path breaking presentations that joined the debate on the liberal side in the late 1980s was Merle Lipton's Capitalism and Apartheid.[1] Merle Lipton's view, which is close to the latter of the viewpoints mentioned above, assumes that many business people were against apartheid policy because the system gave them extra expenses and hardships that conflicted with their business needs.

I salute that Merle Lipton aims to continue her studies in this field of research, and I look forward to many important debates on this theme.[2] The reason that I decided to take her work up for renewed analyses, is of course that I find it still central and topical both for the nature of the historiographical debate and for the present situation in South African political economy. Liptons own argumentation in her later works for a continued historical debate on this subject is central and convincing. The insight and acknowledgment that not all problems in South Africa has been solved, that conflicts have not gone away, and that the social structure behind the liberal-radical terminology still exists are crucial. I also agree very much with Lipton’s intentions of revealing the historical truths despite that it could deepen conflicts temporarily, but her apparent belief in the possibility of doing so with no regards to political affiliation seems an unrealistic standard that she does not fully regard herself.

What I like by Lipton is that she recognizes the influence that society as such play for academia. I value her mainly as an externalist in contradiction to old fashion conservative historians. Nevertheless there is something internalistic over her apparent expectations to radical scholars. She does not see their interplay with the popular movements as natural, even if she considers liberal economists interaction with the apartheid system to be respectable. She is rather one-sided, which is only good for the discussion.

 

In the mid-80s Lipton's book immediately entered the fierce race/class debate, and was promptly criticised by many qualified analysts.[3] Some of these critics, especially Stanley Greenberg, have inspired my own analysis of Lipton’s work. Some of the tensions around her work were probably caused by the fact that she used an economistic-deterministic method, in many ways typical also for classical Marxism, and turned it around fighting neo-Marxism. Her interpretation of the relationship between capitalism and apartheid raised questions about the relative importance class and race had respectively for the development of South African society, and questions about the nature of capitalism and its relationship to government, including to what extent the government was mainly a tool for capital, or was self-autonomous and acted in its own interests or from more indeterminable group interests, such as a more or less privileged electorate. These questions were not only of theoretical interest for South Africa, but also important for the development of political strategies. If capital fractions were against apartheid, they were, of course, potential allies in the fight against the system. If, on the other hand, apartheid supported capitalism, or perhaps was even a condition for its existence in South Africa, then the abolishment of racial discrimination as such might necessitate the abolishment of capitalism, at least in the form in which it had been known so far.

 

In her study of the relationship between capitalism and apartheid, Lipton explicitly defines these categories quite narrowly. By apartheid, she means a system of statutory institutionalised racial discrimination and separation, originating in political measures in the previous colonies and republics on SA territory, and expanded by the creation of the Union through the Nationalist Party's growing parliamentary influence. There are other important dimensions to the peculiar South African model, such as extreme class inequality and authoritarian attitudes; yet even though these have repercussions on apartheid, they are, according to Lipton, conceptually separated from this and are not unique to South Africa.

By capitalism, Lipton simply means a social system, in which there is a great degree of private ownership of the production apparatus, and a low degree of government or joint ownership, and in which owners of capital purchase the workers' labour with wages for the purpose of making profit/added value. Lipton's argument is that the relationship between capitalism and apartheid has been complex and changing, and that neither of the two partial explanations mentioned above are exhaustive, even though each one in itself contains elements of truth.

Instead, she suggests that the capitalists could co-exist with and benefit from apartheid in areas where their business depended on an abundance of cheap, unskilled labour, particularly when they were also export-oriented and had no need for a domestic market.[4] This was the case for most of the mining sector and white agriculture up until the 1960s. On the other hand, apartheid was often costly for companies needing skilled labour or were dependent upon the domestic market, which had long since been the situation in the manufacturing industry and trade. As these sectors gradually became more capital-intense and mechanised, their needs increased for skilled workers and for longer production sequences, which under apartheid increased the costs to them because the system made skilled white workers expensive and limited the domestic market through low wages for blacks.

 

Based on this viewpoint, the questions of to what extent the capitalists supported or opposed apartheid, and to what extent economic growth strengthened or undermined apartheid, are over the long term rather difficult to answer, and should be formulated in another way and differentiated. One sub-question could be: what form of economic growth supported the system? Growth dependent on broad access to easily purchased, recruited labour, could co-exist with apartheid. High-technological growth needing skilled labour and a larger sales market perhaps contributed to undermining apartheid policy.

In addition, Lipton does not believe that long-term growth in the South African economy must be attributed to apartheid, but lists a long series of contributing factors, such as the vast mineral reserves, abundance of capital, entrepreneurial spirit, skills and effective economic measures, such as protectionism.

Lipton states, she agrees that:

 “...a classical Marxist interpretation goes quite far in explaining some aspects of South Af­ri­can development,”

Yet at the same time in her analysis assumes:

“...liberalism’s superior insight in the behaviour of individuals and firms.”[5]

Lipton asks this main question:

“...whether capitalists in South Africa (SA) wanted to retain, strengthen or destroy apartheid and whether they had the power to secure their aims.”[6]

From this starting point, she arrives at the position that the business world in South Africa was never unanimously supportive of apartheid, and that the question of to what extent economic growth undermined the race system cannot be answered unequivocally.

 

Lipton's analysis is based on a very wide-meshed periodisation of South Africa's history in two parts: Apartheid's development period: 1910 – 1970 and apartheid's gradual erosion after 1970. She differentiates between various phases of economic growth. Up to the late 1960s, agriculture needed vast amounts of cheap unskilled labour in order to ensure its profitability. The same was true for the mining industry until the early 1970s. On the other hand, the manufacturing industry and trade already needed skilled labour and a growing domestic market rather early on, which could only be advanced through higher wages. Apartheid did not benefit these sectors at all. Up to the mid 1960s, agrarian based capital had great influence, mostly due to the rigid dominance of racial prejudices within the political sphere. Since then, the national economy became steadily less dependent on agriculture and mining operations, and even these sectors saw an increased need for skilled labour. This development gave rise to broader support for changes in labour market policy in favour of a more mobile competitive labour force with a greater number of skilled blacks. In addition to this, favouritism towards Afrikaner-controlled companies by changing governments created a new group of Afrikaans-speaking liberals, who also wanted to undo apartheid and thus contributed to fractures and splits among the Boers. The Afrikaner capitalists felt the freeze of the domestic market, the rising threat against their export opportunities, the hesitation of foreign investors and the problems of technological imports and innovation.[7] Meanwhile, political power lay with the representatives of the remaining static sectors and groups, and their reaction against the rising threat of uprising consisted of ever more authoritarian measures.

“...the power of the declining classes and sectors had been institutionalized and entrenched, and as the challenge to them grew, they shored up their power by authoritarian measures. The ruling NP, and the vast bureaucracy it sprawled had a vested interest in controlling the rate of change, and in slowing and prevented some changes, particularly in the political sphere, which threatened their power and jobs.”[8]

 

After establishing, but not fully explaining, the close ties between class and ethnicity, Lipton assumes that neither broad class categories that divide the population into workers and capitalists, nor racial ethnic categories that divide it into Afrikaners, coloureds, Indians, whites or into English-speaking and Boers, Zulus and Xhosas, satisfactorily explains the groups' behaviour patterns. By and large, she affiliates herself with the liberal viewpoint:

“In the competition for resources, class conflicts often took an ethnic form; the lines of cle­a­vage between groups, and the alliances constructed in the political struggle, were usually along eth­nic, not class lines.”[9]

Lipton postulates that liberal capitalists were rather powerless in relation to expediting reforms, and that this is precisely due to the fact that political organisation was formed along race lines rather than class affiliation. Nevertheless, in later works she ascribes much of the political change to pressure from business.[10] In her own way, Lipton criticises both liberals and Marxists for being one-sided, and, based on a somewhat eclectic argument, calls for a new form of synthesis:

“Apartheid cannot simply be explained as the outcome of capitalism or racism. Its origins lie in a complex interaction between class interests (of white labour as well as of sections of capital) and racism/ethnicity, reinforced by ideological and security factors.

The dominance of white agriculture and white labour until the mid-1960s was based on political, not economic power.”[11]

 

To me, Lipton represents a liberal economic historical view, which in a number of areas has learned from radical methodology and ways of viewing things, yet is nonetheless deeply rooted in a fundamentally liberal view of society.

 

In Lipton's opinion, apartheid was thus incompatible with highly developed capitalism, the growth of which depended on the introduction of high technology. Prior to the 1970s, the shortage of qualified labour mostly affected the manufacturing industry, which was not yet dominant, but with the greater mechanisation of agriculture, the need for skilled workers grew here as well. In the mining industry, the rising gold prices of the 1970s meant that many white workers could be transferred to actual management positions, which contributed to breaking down the resistance against professionally training black mine workers, and thereby paved the way for abandoning “the job colour bar”.

This development took place at the same time as growing capital concentration allowed the dominant conglomerates to expand across economic sectors. During this process there was a partial merging of Afrikaner capital and British capital, and Afrikaans-speaking economists and business people in management positions gained greater insight into the universe of English liberalism attitudes, including greater understanding that the lack of dignity and the absence of all social and political rights for the direct manufacturers of the main portion of the country's assets also created irresponsibility and antipathy toward product and productivity development.

Lipton's line of argument assumes that large-scale capital was increasingly worried, not only about apartheid's residual economic irrationality, but just as much about the more "external" costs, e.g. the growth of a gigantic bureaucracy and security apparatus, increasing political instability, the breakthrough in international sanction policy and the lack of international confidence, resulting in declining investment interest.

Her fundamental viewpoint is, however, that it was the pressure from economic interests that forced the government to change the rigid, all-encompassing racial segregation policy. That occurred with the recognition of the African trade unions from the late 1970s, the acceptance of large permanent African settlement in urban areas, gradual repeal of passport laws from 1986 on, and formal abolishment of all “petty-apartheid” legislation in 1989-90.

This development can undeniably be interpreted as the liberal argument having proved its truth-value: that economic growth in the end forced the South African society to rise above white racial dominance.

 

Lipton's thesis in Capitalism and Apartheid was that apartheid contributed to economic growth in some sectors during certain periods, but most often stunted economic expansion in the most important sectors, and she attempts to prove the veracity of this through a study of the effects of apartheid on different sections of the economy.

In her analysis of political power, she differentiates between various historically specific “perceived interests” within the society and looks at “the tastes of the peoples and groups within it and on their power to secure those interests,”[12] and she maintains that “The test of where power lies is whose will prevails in conflicts of interests.”[13]

From this point of departure, she studies changing interest and dominance relationships among the fractions of the white population, and their expression as class actors. Each of these are analysed individually, including agrarian capital, mining and manufacturing capital and the white worker class. The dialectic interaction, or struggle, between these forces is, on the other hand, not studied quite so carefully. Lipton's analysis is in some ways comparative to Stan­ley Greenberg's from 1980.[14] They both have a somewhat elitist view of history that focuses on the dominant classes, and they are both dividing the development of the racial supremacy into to different parts: A period of intensification and a more recent crisis of hegemony.

Greenberg stood for a more realistic tendency in relation to early radical structural historical research, and his view of the role of the manufacturing industry under the development of the race state was regarded as controversial in this camp. He subscribed, to some degree, to Blumer's liberal-influenced viewpoint: the manufacturers had only adjusted to the ruling order, but were not the instigators. According to Greenberg, the ones behind the race system were the white farmers, the white workers and mining companies. In regards to the latter group, Lipton mostly disagreed with him.

 

Although Lipton's analysis methodology bears certain characteristics of structural Marxist inspiration, it rests on solid fundamental liberal views, and seeks to confront the early radical structuralist view of British mining capital as being a party to the development of apartheid:

“This study has shown that major apartheid policies (particularly the vertical and horizon­tal controls) reflected the interests of white agriculture and white labour and were often opposed by urban and mining capital.”[15]

Agrarian capital, interested in labour control and limiting the competitiveness of black agricultures, is viewed as apartheid's primary support group. White workers were junior partners in an apartheid coalition, as they:

“...actively promoted many apartheid policies, particularly the job colour bar. This policy was costly to white capital (and to black labour), but benefited white workers, whose interest thus reinforced their prejudices.”[16]

In some opposition to common liberal analysis, Lipton assume that preferred material interests and racial attitudes were equally compelling in making racial segregation appealing to white workers. On the other hand, she has greater understanding for the mining companies for whom “therefore, apartheid was a more complex equation.”[17]

The period Lipton defines as “Partial erosion of apartheid,” is characterised thus:

 “...what is actually happening is a contradictory and confusing mixture of reform (particularly in the socio-economic sphere) and maintenance of apartheid (especially politically).”[18]

She analyses the class forces behind this process and in this connection argues for a “Growing convergence of views among capitalists about apartheid labour policies.”[19]

Capital interests lay in reforms that ensured “a free, mobile, competitive labour mar­ket with large numbers of blacks entering skilled and semi-skilled jobs.”[20] Lipton does, however, see a certain ambivalence among the owners of capital towards large political changes that might have affected the management roles of whites and security, but the active conservative power emanated from the white worker class.

 

Lipton's analysis also includes the political splits within the power bloc, which she declines to reduce to a class struggle. Due to the influence of Afrikaner nationalism, she does not actually view the apartheid state as a capitalistic state because “political power lay with the Afrikaner nationalist alliance in which, initially, white agriculture and labour were dominant.”[21] Therefore, apartheid did not exist only to serve class interests in the normal sense. On the contrary, during the last years of apartheid the opportunities for reform were strengthened at the same pace as large-scale capital class interests infiltrated the National Party.

 

Lipton's book must have had a stimulating effect on both Marxists and liberals, in that she partially attempts to undermine and partially adopts aspects of both research trends. The liberals can be pleased with her attack on class reductionism, while the Marxists must acknowledge her structural materialism. However, it is clearly stated in the final chapter on the economic historical debate that her perspective contains a confrontation with the radical school:

“...a Marxist analysis cannot account for the importance, autonomy and effectivity of ra­cial/ethnic factors, nor for the power of white labour and the bureaucracy.”[22]

Although the radical school has many examples of both reductionism and narrow functionalism, it developed into deep versatile approaches with consideration for human nature. Lipton dissociates herself with many years of intense debates between Marxists. Still, she actually attributes perhaps just as much to Marxist-inspired historical research as she detracts from it.

Lipton's study also includes the government bureaucracy, which she attributes with its own relatively independent interests:

“Pari passu with the growth of the state sector, a large bureaucracy emerged, with interests and views of its own. It played a major role in the struggle over apartheid.”[23]

She maintains that government bureaucrats were opposed to the reform process and the power position of these government bureaucrats,[24] as well as the government's alleged continuing conflict with the business world, lead her to conclude that Weber-inspired government theory is more applicable than Marxist in the case of South Africa. That is in my opinion not a correct assertion. Lipton is in the right that some radicals tended to view the government as a “black box” with no interests or drive of its own. However, Lipton to a large degree overlook that the later revisionist analyses focused a great deal on internal splits and conflicts of interests within the white power block. Yudelman, who is close to radical viewpoints in some of his works, thus endows the government with both an inner dynamic and its own interests. James and several others do the same.[25] Rather than cross over into Weberism, these analyses expand Marxism's theoretical borders, while retaining a radical capitalism-critical analysis foundation. It would seem that some newer studies agree with Lipton’s methodological approach though:

Some of the most interesting findings of this research have concerned differences and divisions within rather than among classes as they are defined by …neo-Marxist class theory. These theories have therefore not been particularly useful for identifying social divisions which have emerged during the apartheid period. For the purposes of this study, which has relied on existing occupational categories, neo-Weberian models of class structure have been a somewhat more useful guide to occupational classification…However, the limitation of neo-Weberian class schemes is that they do not provide an interpretation of the forces which shape the class structure and division of labour. For this I have relied on the contributions of labour process theory, rather than those of class theory.[26]

 

Even if it could be challenging to investigate who was first with a mature analysis of fractions in capital and state, I am not sure how constructive this part of the debate would be. The radical assessment; that later liberals took notice of and build on radical research results can in my opinion not be denied and there is nothing strange or wrong about it. I hope that history is a cumulative science. Nobody is denying that liberals like O’Dowd rather early saw reasons for the erosion of apartheid, but it cannot be denied either, that many liberals worked close together with the system right from “protective segregation” from early 1900th through every kind of official commissions reports until 1948, and even during the development of the full police state in the 1960s, or that the lack of results of the pragmatic liberalism called for analyses more useful for the suppressed and exploited majority.

 

Business world resistance to apartheid

Lipton’s book raised the main liberal objection to the radical school fairly convincingly, i.e. that apartheid policy has historically set inappropriate limitations on the free development of capitalism, which “led to recurrent attempts to erode apartheid by capitalists.”[27] In Lipton's opinion, the capitalists were forced to adapt to the racial realities throughout most of the twentieth century. Other interests groups, particularly white workers and commercial agriculturalists with better access to the government, were in a position to pass the expenses of apartheid on to the mining companies and manufacturers. Lipton writes that the latter: “...did not need, and indeed opposed, most apartheid labour po­licies.[28]

In her resent works, Lipton is trying to document that the Marxist/workerist argument is crumbling and that today they admit to the changing role of capital due to rising costs under late apartheid. She might have something there. On the other hand, she does not investigate in dept to which degree cost difficulties for capital were mainly results of apartheid restrictions or of political worker resistance or of international solidarity measures, which seems to be quite crucial for her whole argument.

Two opposite arguments have been drawn up in this discussion:

That the business world has contributed to the erosion of apartheid.

That business was the major beneficiary of apartheid.

It seems to me that in a historical perspective these two possibilities are not necessarily inconsistent or incompatible.

 

Lipton's study of the white agriculturalist position

The primary sectors, agriculture and mining operations, dominated the South African economy at least until a point in the 1960s. Farmer motives and share in the distribution policy is a little unclear, as Lipton never clearly defines the relationship commercial agriculturalists had with capitalism. If they became modern market-capitalistic large-scale farmers early in the twentieth century, their apartheid support must somehow be in opposition to Lipton's general thesis. Lipton partially clears up the problem by describing white agriculture as outmoded: “...a system which, though capitalist, had features which could usefully be called feudal.”[29] Later she sets the farmers' dependence on labour repressive systems up against the presumably more modern attitudes of the mining and manufacturing industries.[30] She apparently does not view white agriculture as actually being modern capitalistic.

 

The white farmers were among the leaders in the implementation and defence of the segregation policy, such as the 1913 Land Act that reserved the main portion of the land for whites, as well as the passport laws that restricted black worker stays in urban areas. These measures, of course, eased access to, and limited the costs of, African labour, just as they prevented market competition from black farmers. The white agriculturalists also supported the apartheid politicians who segregated the blacks socially and excluded them from political rights.

Lipton, however, notes one important exception from agriculture's support of apartheid. The farmers renounced ”the job colour bar”, which benefited the employment of white workers and excluded Africans from skilled and certain semi-skilled jobs. Excluding the majority of the population from competition for skilled work it increased production costs for skilled labour.

White agriculturalists, however, to some degree managed to avoid this dysfunction in apartheid and a great deal of skilled, even actual management, functions in agriculture were increasingly performed by Africans and coloureds as early as the period prior to WWII, despite high white unemployment. One of the results was that more poor whites were forced into urban areas. When they themselves had got rid of expensive white labour, the white farmers supported their former white farm workers in their fight for job bars in mines and industrial sectors where the white workers had to be protected from "unfair competition" from arriving black labour considered less natural in urban areas.

Lipton views it as worth noting the extent to which white agriculturalists, presumed to be the cornerstones of apartheid, were in a position to pass the costs of apartheid on to the real capitalists. She views this as an important indication of their political power. She sees another sign of the powers of the farmers in their ability to ensure favoured access to freed unskilled black labour, which was sometimes in short supply in southern Africa all the way up to the 1960s. The passport laws were put through in such a manner that the Africans were bound to the rural areas, and these laws kept black wages low by hindering wage competition from the mines and urban businesses.

Beginning around the 1960s, however, new technological opportunities increased the capital intensity and degree of mechanisation of agriculture, creating larger units, which in turn led to important changes in labour market policy. First, it limited the need for vast amounts of unskilled workers. Second, it led to an increasing need for more skilled workers, who had been educated and trained in advance, with all that involved for the basically feudal lord-servant relationship in rural areas. Third, the greater capital intensity meant that wages now constituted a smaller portion of total production costs and thereby led to large-scale farmers being somewhat less preoccupied with keeping wages down. Finally, the farmers' interest in the domestic market grew, and they were therefore more prepared for the rise in the general wage/purchasing power level that the manufacturing industry and trade had needed for some time.

Lipton shows that this development was gradually followed by changes in attitudes within the South African agrarian union, SAAU, after the 1970s, such that the union carefully began to plead for wage increases, improved working and educational conditions, and increased mobility. In its recommendations to the Riekert Commission hearings in 1979, the SAAU supported doing away with influx control, of which it had been a warm supporter throughout many years.[31] The growing influence in farming from large diversified companies like Anglo-American and Rembrandt is also noted.

 

Yet Lipton can see that there are diverging opinions between farmers on these matters. The less effective agriculturalists on marginal land, namely in Transvaal, never gave their support to reform policy, but on the contrary continued to be important support for The Conservative Party and the HNP, Herstigte Nasionale Party. However, she believes that the tendency among leading farmers clearly moved towards less racist attitudes after the 1970s, which she views as proven by their support of the Lombard and Buthelezi Commissions, which, among other things, recommended experimentation with ”powersharing” in Natal.

How the scepticism of white farmers towards land reforms and other similar, more radical distribution measures will develop in South Africa in the future is, of course, an entirely different matter, which Lipton's historical analysis could not address.

 

The capitalists were not in a position to force through their anti-apartheid convictions until the 1970s, when the farmers became less dependent on subversive and labour-controlling measures, and with the assimilation of Afrikaner capitalists and business leaders in the business world. Therefore, it was not until late into the twentieth century that the internal conflict between capitalism and apartheid became topical. The analysis of the conflict between capitalism and apartheid in Lipton’s work is founded on a materialism, which in  power reaches the level of Davies and O'Meara's early Marxist structuralism.[32] The manufacturing industrial and commercial capitalists were, regardless of their personal ideological convictions, in the end forced to oppose apartheid on material grounds:

“...their interests, and the costs (and interconnectedness) of apartheid labour policies drove them to oppose these policies whether or not they were liberal.” [33]

The capitalists were:

“...not free to do as they chose: economic requirements set the limits within which it was possi­ble for them to conform if they wished to remain in business. Apartheid proved too costly and un­workable.”

The conflict between the capitalists and the apartheid state became topical during the 1970s because growing capital intensity now united the various business sectors.[34]

 

Lipton's study of the mine owner position

Mining capital constitutes a big problem for validity, logic and cohesiveness in Lipton's argument. It is difficult to present a fundamental contrast between capitalism and apartheid without including this very central sector. Lipton takes different positions on the mining industry. One the one hand: “...mining capital were more complex.”[35] Therefore, it is viewed as difficult to place. On the other hand, this sector is presented as unique due to its great dependence on foreign African labour: “...the gold mines were not typical of the South African economy.”[36] However, she finds that “It is curious,” that the most profitable mining companies affiliated themselves with the industry sector's general demand for continued wage freezes,[37] and she finds that “the policies of progressive mining capital since World war two are puzzling,” because the mines did not adhere to the manufacturing industry's scepticism towards race policy.[38]

 

The mine owners supported the Land Act of 1913 and the passport laws, as did white agriculturalists, which left black labour abundant, easy to purchase and without legal rights. They forced their workers to live in compounds, and with a heavy hand oppressed the periodic attempts at creating unions.

Lipton's analysis shows that the mine owners, in contrast to the white farmers, could not escape the ”job colour bar” race barriers that the white unions, in her opinion, had forced upon the mines. Repeated attempts by the mining companies to undermine the job colour bar led to heated conflicts with white workers, culminating in the Rand Revolt that shook the young South African union in 1922. To Lipton, the fact that the mines challenged the job colour bar is an indication of the high costs of this arrangement. The strong influence of white labour interest organisations within the Pact government after 1924, however, forced the mine owners to come to terms with the situation.

According to Lipton's explanatory model, this had significant consequences for the entire labour market policy. The fact that the mines could not use blacks for skilled work contributed to a further continuation of the migrant worker system, because employers only develop an interest in a permanently residing, family-based labour force with low turnover if they are to invest in the worker's education as well.

Other factors that perpetuated apartheid's institutionalised oppression in the mines was the fixed price of gold that did not rise much from 1934 to 1970, which made it impossible for the mines to pass the rising costs on to the price. Second, it brought about slow advance in the technological development in the gold mines, continued high work intensity and dependence on vast amounts of unskilled workers. However, Lipton does not see the "opposite" side of the story; the ultra-cheap workers made investments in technological development less necessary. Lipton postulates that the white, large-scale farmers had preferential access to black workers, which led to the mine owners becoming increasingly dependent on foreign African migrant workers, mainly from Mozambique, which made it difficult to create permanent residents. Additionally, the mines that in the beginning were owned by foreigners, had costs forced upon them from higher taxes and freight rates than other sectors.

In Lipton's opinion, this stands in contrast to the white worker success in job security and the agriculturalists securing access to black workers, and shows that the mine owners had less political power than would be expected based on their dominant economic position, measured in their contribution to the GNP, tax yield and foreign exchange earnings. Her argument is not that the mine owners were completely powerless, yet they most often lost in matters where they stood in opposition to local white farmers or white workers, whose national interests had prominence in the government.

 

During the 1970s, the Chamber of Mines labour market policy began to shift. The mine owners renewed their pressure against the job colour bar due to an acute shortage of skilled workers. They also began to work directly toward making a larger portion of the labour force permanent residents, and they supported the secondary industry demand for socio-economic reforms, including labour mobility, higher wage levels, union rights, and later on, political rights as well.[39]

As reasons for this political shift that began to occur twenty years before apartheids’ final breakdown, Lipton lists the following as background, most of which is also included in many radical explanations:

o       The rising price of gold after 1970, which made it possible to meet wage demands, cultivate a stabile labour force, plus other industrial reforms.

• The general unrest within the black labour force, which after 1973 reinforced the need for reforms.

o       Growing criticism from abroad to which the domestic mining companies, all of whom had investments abroad, were sensitive.

o       The pressure on the mine owners from the manufacturing and commercial sectors of increasing importance to the white society.

However, attitudes changed at a slower tempo in the mines than in the secondary industry. Above all, the migrant worker system remained completely intact for a very long time. Lipton points to the dividing lines within the Chamber of Mines between progressive companies that began to come in line with the manufacturing industry and trade on one side, and conservative companies such as Afrikaner-dominated Gencor and British Goldfields who had long been hostile towards black unions. Nonetheless, the tendency from the mid 1980s clearly indicated a change in attitudes, in contrast to apartheid policy.

 

It seems to me that Lipton, in her scepticism towards radical indifference to divergences between groupings of capital, does not pay enough attention to O'Meara's well-known work on this subject.[40] In the end, the mining capitalists are to some degree pardoned by Lipton for the job colour bar the white mine workers forced upon the sector against its will, and which was always the greatest threat to the profitability of the mines.[41] Due to the extra expenses this job reservation placed upon the mine owners, “other cost had to be cut,” and wages to the black workers were the only area where the mine owners “were given a relatively free hand.”[42] Driven by the irrational measures forced upon them by stronger groups, the mining capitalists were apparently forced to introduce a maximum average wage for African workers, build closed compounds to store labour, support restrictions that made it impossible for the Africans to support themselves by market-oriented agriculture, taxation designed to force them into contract work, and influx control to regulate the flow of black labour.[43] In reality, the mine owners were not supporters of “as sub­stantial a state apparatus as the farmers,” however,

“...extra costs imposed on them by apartheid intensified their own need for labour-repres­sive measures such as closed compounds.”[44]

Yet Lipton does not in the book attempt to document her assertion with a more in-depth historical economic analysis of the profitability of the mining industry.

 

Lipton's study of the manufacturing and trade sector position

The secondary and tertiary business sectors were, in Lipton's opinion, open opponents of race policy as early as the 1920s, which was already apparent in the establishment of the employer organisations Federated Chambers of Industry, FCI, and Associated Chambers of Commerce, ASSOCOM.[45] Their futile pressure for reform concentrated on specific aspects of apartheid, first and foremost the job colour bar and the related matter of black access to professional training. Enduring strife played out between employers and white unions, who were supported by the Afrikaner nationalists and the English-speaking Labour Party.

Small-scale, urban-based employers could not circumvent the job colour bar to the same degree as the white agriculturalists, but it did, however, happen to a greater extent than in the mines, partially due to the large numbers of small companies in those sectors mentioned and partially due to less effective white unions, in contrast to the mines where a small number of mining companies could easily be monitored. One contributing factor to the breakdown of the job colour bar in these sectors was the introduction of new technology. Mechanisation in industry established a grey area with semi-skilled work, where the work process was frequently divided and redefined, and a simple skilled/unskilled division was awkward. The trend was self-reinforcing in that the employers developed an interest in stabilising their black workers and reducing the turnover. This interest conflicted with government policy directed towards preventing Africans from becoming permanent residents in the urban areas with their families, as it was believed this would cut the African ties to the reservations and their future homelands, thus gradually leading to their acceptance in society and thereby unavoidable demands for political rights as well.

The urban-based employers did not have to force the blacks to work for them. On the contrary, the goal of the passport laws was to prevent the blacks from overrunning the urban areas where wages were higher than in mines and agriculture, and life felt a little freer with more modern cultural offerings. The passport laws led to periods of labour shortages in the urban areas, as well as instability and bureaucratic headaches for employers. The employers in the urban areas, according to Lipton, also supported a general increase in wages because that would help productivity and expand the domestic market on which they were dependent. Some employers also supported the recognition of black unions in order to create an allied force in the fight against the job colour bar, and to improve their communication with workers. Therefore, certain employers, foremost those within the textile industry, recognised black unions as early as the 1930s and 40s.

Lipton recognises that there are variations between the employers in this field, determined by factors such as their numbers, capital intensity, product group and profitability, ethnic affiliation and political stance. She believes that organisations such as the FCI and ASSOCOM, which defended a progressive policy in the matter of race, represented the majority of employers. More marginal, less effective, employers such as those represented by the Afrikaanse Handelsinstituut, AHI, were against reforms. As early as 1960, they constituted a very little percentage of the urban employers, yet were politically influential due to their close ties to the National Party.[46]

Lipton can see that even though progressive employers defended reforms of both the labour market legislation and of some socio-economic spheres, there were other aspects of apartheid that they did not challenge. She openly admits that almost none of them questioned segregated residential areas, educational segregation and the exclusion of blacks from political rights, even though they did not openly support the introduction of such measures, either. Their attitudes were often contradictory and ambivalent, as is most clearly illustrated by the matter of relocation control. Many employers shared the fear of the white urban population of being overrun by the influx of Africans, and feared a greater number would threaten white security and bring about unrest, criminality and revolution. They were therefore supporters of a certain degree of influx control, yet as capitalists they needed larger labour force reserves, and thereby more permanently residing urban workers, and based on this, supported certain easements.

Lipton puts strong emphasis on the period during the United Party Government during WWII, where greater pressure came from trade and the manufacturing industry due to the stronger growth during this period. She maintains that this government undermined portions of segregation policy and in reality was a supporter of black urbanisation and legalising black unions. In my opinion, this assertion only partially holds. Legislation was made more stringent formally in several ways during these years, through strike bans among other things, and when necessary, the United Party Government intervened with brutal oppression, such as against the wave of strikes in 1942, the great mine strike of 1946, and unrest in rural areas.[47] In Lipton's opinion, the limited and cautious reforms of this semi-liberal government were halted in 1948 by white agrarian and worker interests in a clear political break. The National Party buttressed up the crumbling segregation structures using Afrikanerdom, renewed boer ideology, and expanded it to include the secondary and tertiary industries.

 

Lipton's study of the white worker position

The main culprits in Lipton's scenario are the white workers. Their victories within job reservation, as well as wage and employment privileges, were a major obstacle to free economic growth and forced the mining companies among others to participate in race policy. They are the irrational, subjective element that forces Lipton to retreat slightly from the deterministic materialism. Even though Lipton acknowledges that race policy promoted the material interests of the white workers, she views prejudices and status as the key driving forces. The white workers' fight for their interests is first and foremost “gratifying their racial prejudices.”[48] While she expresses great understanding for the limited, political and economic manoeuvring room the mine owners had, she is not able to find a comparable "emergency" in the case of the white workers, for example based on the attempts of capitalists and the governments to hold down wages with the help of cheap unskilled labour prior to 1924 and in the first half of the 1940s.

 

Reform policy as an expression of capital's victory

In Lipton's opinion, conflicts remained between industry and government over labour market and related socio-economic policy at least from the time the NP took over power in 1948. The fact that the government actually by and large put through its rigid policy all the way up to the late 1970s, and basically maintained its course until the early 1990s, is an indication to her that political power in South Africa was not a reflection of economic power. It was the other way around.

After the Sharpeville crisis of 1960-61, which led to temporary capital retreat from South Africa and a short-term intensification of criticism from the business world, Lipton believes that Prime Minister Vervoerd began to take the business opposition seriously. He formulated his “separate development” policy, which he maintained would make economic growth compatible with apartheid, even in secondary industry. First, the labour intensive industries would be "decentralised" (geographically, not ownership wise) to Bantustans, or their bordering areas, where employment policy could be implemented with fewer restrictions without repercussions to central white areas.

Therefore the government, in repayment for decentralisation, would allow a slightly more flexible labour market policy in white areas for industries that could not be decentralised. In particular, job fragmentation would be allowed, and the semi-skilled portion of the job could then be given to black workers. This arrangement, “the floating job bar”, would make room for some blacks to improve their position, yet still below the level of the white workers, such that the hierarchical race structure would remain intact. The government made a big effort to put through this spectacular experiment within the scheme of social engineering. Had it worked, it would have modernised apartheid with its main structures intact instead of abolishing it. The experiment failed, among other reasons, because the companies opposed the efforts towards decentralisation, as they were expressed in the Physical Planning Act of 1967.

Lipton outlines the employers' fight for their interests in these matters from the mid 1960s led by the FCI and ASSOCOM. During the 1970s, they gradually received support from more conservative employers such as those in the AHI who, despite having approved of separate development in the beginning, found it to be costly and impractical in practice. The growing numbers of critical, urban-based capitalists within NP structures were a significant factor for the gradual shift in government policy.

Lipton believes that it was as early as the 1970 election when Verwoerd's successor, Vorster, beat the HNP, that the path was paved for the first real government concessions to the business world. She bases her assertion on small alterations to the job colour bar, small changes in access to education, and formal expansions of the blacks' right to own property, etc., without clarifying how minimal these changes actually were during the first several years. Lipton believes that these political developments contributed to a growing political debate and black activism, including the strikes of 1973 in Durban and the Soweto unrest in 1976, which, for its part, in turn pushed the capitalists towards more extensive reform plans.

The employers now expanded their goals to include a complete repeal of the passport laws, and a more open attitude to negotiations with black organisations on citizenship and political rights, including the ANC. The business world's political wishes were listed in a series of documents such as the Business Charter of 1985, signed by most of the business world's organisations. The fact that this line was now even supported by conservatives within the AHI and the Chamber of Mines meant that the pressure became more effective. The capital interests that had previously been split became more convergent due to technological development, among other reasons.

Lipton views the limitations of reform policy up to the early 1990s as a result of the continuing weakness of the capitalist's position. They still had the white workers against them, who now to a great extent had been transformed to a bureaucracy within the government sector, as well as the NP’s political apparatus that sought to retain its grip on power.

 

Lipton's studies show that changing portions of capital at different points in time stated it was against the most rigid sides of apartheid policy, and based on this she comes to three main conclusions:

Ø      Even though pressure from the owners of capital was often very fixed and limited, their attitudes generally tended to be toward a less racist policy and abolishment of apartheid.

Ø      The pressure from the business world did have positive, dynamic consequences, including within education policy, expansion of black rights in urban areas, labour force mobility and union rights. These changes strengthened black negotiating power, both in its role as consumer and producer, which in turn gave rise to new rounds of pressure and changes. As the entire system hang together in a very complex manner, the undermining of some of its cornerstones began a process that undermined its entire structure.

Ø      Individual intentions are often difficult to interpret, as they inevitably include elements of individual interests, and South African capitalists are no exception in this regard. Regardless of their motives, however, it is the results of their actions that count.

Lipton's argument here is not so much based on South African capitalists being ideologically liberal, but that their narrow material interests led them in the opposite direction of apartheid policy. Regardless of their intentions, this conflict had wide-ranging consequences in the form of a gradual softening of a situation that for some time had seemed to be deadlocked.

 

Problems in Lipton's analysis

Lipton's Capitalism and Apartheid is clearly one of the most qualified attempts within the last thirty years to set economic growth and racial discrimination against each other as incompatible in modern South African society. The timing of the book's publication is important to its evaluation. As a result of the rapid growth of the apartheid economy during the 1950s and 60s, the liberal defence for capitalism as promoter of change had, since the late 1960s, to some extent been in a defensive position. At the same time, the intellectual Marxist perspective gained great cohesiveness and influence within university circles.

With the South African social order being increasingly besieged by the black resistance movement and by international solidarity, the business world, supported by liberal academicians, attempted to separate the economic and political spheres and underscore the business world's critical stance towards apartheid.

The appearance of Capitalism and Apartheid must therefore be viewed in this historical context. The book was part of the prelude to new liberal self-confidence in South Africa, not without inspiration from the emerging global counter-offensive from new liberalism and new conservatism, and the increasing problems of “the real existing socialism”, but primarily because of South Africa's complex internal crisis. The new vitality in liberal research was already apparent with Charles Simkins' lectures for the South African Institute of Race Relations and the collective work of Jeffrey Butler, Richard Elphick and David Welsh on South African liberal perspectives: Democratic Liberalism in South Africa.[49] In a newspaper review, Welsh praise Lipton's work and, among other things, calls it:

“...perhaps the most devastating critique of the neo-Marxist position yet to appear.”[50]

The advance expectations of Lipton's work were great. She had previously conducted thorough studies of agricultural development within South Africa, and had attacked the Marxists right at the heart of the problem, namely economic growth contra social equality, a situation from which other liberals had retreated.[51] She had already managed to lay the foundation for her argument that economic development in South Africa had improved the living conditions of the blacks over time in a debate that is somewhat reminiscent of the long-term strife between historians in England over the effects of the industrial revolution, based on to what extent that led to impoverishment or progress.[52]

 

Merle Lipton's grand overview of the various economic sectors throughout the entire twentieth century gets it strength from an engagement in the contemporary debate of the time. Her work has been criticised for being not particularly source-close and her interview methods have been seen as unclear and her arguments directed against phantom positions.[53] In the debate around Liptons Book, she has also been accused by many reviewers, including myself, for using primarily secondary sources, for not using some important journals and for not referring to contemporary works of radical researchers. During my rereading and my own discussions with Merle Lipton, I have realised that most of these allegations were actually both wrong and unfair. Liptons work is build on deep, professional studies and it still stands as a major contribution to research in South African economic history. I disagree fundamentally in Lipton’s conclusions, but the problem lie mostly in the interpretation of the data, not in Lipton’s source knowledge.

 

Lipton is not placing much significance to the very god reasons that business could have to be against reforms. It was part of the complexity that a socialist oriented revolution in alliance with the socialist block, which had been an important supporter of the struggle against colonialism and western exploitation of Africa right from the Comintern congress in 1921, would have been a possible choice for ANC, had the vitality of the economy in the socialist countries kept the pace, it had until the 1970s.

Business attitudes towards late apartheid was even more illogical and contradictory than the Lipton are willing to recognize. Capital was still interested in restrictions in the workers negotiation power, but at the same time afraid of a growing number of wild uncontrolled strikes with no responsible counterpart. They were indeed interested in low wages, but at the same time in a growing consumer market. They were interested in access to foreign markets, but also in protection of their own. They wanted liberalisation as part of globalisation, but they also liked favourable government contracts, and it seems strange that the Lipton recognises the need in SA business for globalisation but at the same time underestimates the importance of the treat of sanctions.

I also belive that Lipton’s recognition of the state-supported corporate sector is too weak. State protection/protectionism has at certain stages been helpful for most capitalist societies, but seldom as necessary as in South Africa. The sad fact that suppression, restoration, authoritarianism, and state created or supported monopolies have been necessary and productive elements at certain stages of development in most western countries is hardly explained satisfactory by the author.

 

Radical researchers have questioned the progressive role of the business world during the abolishment of apartheid, because its reform initiatives were in reality forced by working class activism, and, in addition, were severely limited and in themselves led only to marginal adjustments.

Lipton to some degree base her argument on a solid study of the Chamber of Mines’ attempt to abolish or limit the job colour bar. Yet there are connected historical studies that Lipton strives to avoid: the history of mining’s demands for new passport laws; their demand to make breach of contract (by more or less forced labour) a penalised criminal offence; their demand for undermining of and espionage against the labour unions by law enforcement; control of worker residential areas; monopolisation of labour recruitment; support of a policy creating poverty in the African reservations as a prerequisite for the “liberation” of free labour; and of poll taxes with the same purpose. These histories begin in the last decades of the 19^th century.

The validity of Lipton's argument rests to some degree on the assertion that mining capital was forced to participate in labour repressive race policy due to the artificially high costs of using white labour. If, on the other hand, mining capital from phase one was deeply involved in the creation of race policy, which many radicals believe they can prove, her thesis on the business community resistance to apartheid can only be partly substantiated. If Lipton could show that the job colour bar came prior to, and founded, the histories mentioned above, her thesis would be proven to a lager extent.

 

Greenberg and Helliker, among others, have accused Lipton’s book for lacking theoretical consistency.[54] Lipton thus argues that the Chamber of Mines attempted to compensate for losses from the job colour bar by supporting the government's labour repressive practices. But why should companies operating on principles of profitability not attempt to lower wage costs for the black labour force under any circumstances, regardless of more or less unnecessary costs to the white workers? With the international gold price fixed in advance, and very little interest in building up a domestic market, mining capitalists had interests in both the abolition of the job colour bar and weakening the black power position in the labour market. Therefore, there is no reason to be as surprised as Lipton that the mining companies continued their support of the labour repressive measures, even during periods when the mines were extremely profitable. Holding black labour wages down was their top priority. Yet in addition to that, the mine owners, the “randlords”, were entirely aware that the short-term interests of mining capital had to come second to its long-term interest in balance and stability within the overall political economic system.[55] Taxes distributed to poor whites and the wage costs for white workers were, in that connection, acknowledged political necessities for securing the racial split of the working class; an intention for stability through divide and rule that succeeded fairly well throughout more than fifty years, considering the social tensions.

 

Lipton's depiction of the manufacturing and trade business resistance to apartheid is concentrated on the discussion of job reservation reform. She treats the business world position on the African union negotiation opportunities somewhat coldly, compared to the overall analysis. She writes that commercial interests were split on the union questions, but she emphasises that “there always were employers who favoured recognition.”[56] During the period following Shar­peville, when people were “security conscious,” business people lost interest in the matter of recognition, yet it re-emerged during the 1970s when the split among employers re-emerged and when “progressive capital” finally got the upper hand, the black unions won recognition.[57]

A favourable view of, and a great deal of sympathy for, private business is necessary to fully accept Lipton's explanation. There is no doubt that organisations of business people or employers, the Chamber of Mines in particular, outwardly supported recognition of African unions during periods of unrest and pressure on the labour market, yet that was hardly the dominant attitude in reality. Even in the early 1970s, when the need for recognition was pressing following the Durban strikes, most companies attempted to create employer-controlled liaison committees to circumvent works committees elected by the black workers themselves. When African unions finally won recognition during the 1970s and 80s, such came first in the foreign-owned companies that at the same time were under the greatest pressure from the international solidarity movement.

 

I have been looking in vain in Lipton’s book for analyses on the lack of agreement between statements and action in the business world. Seen from a radical viewpoint the task of the established state to some degree was to look after the overall interest of the capitalist system. It might have been seen as the duty of the state to take the blame, so capital fractions could keep their back free. Lipton does not really consider this possibility.

Of course mine owners would have liked to use only cheap black labour, but would that actually have been less discriminating? From 1924 with the establishment of the Pact government, the mine owners too saw the light: In a South African situation with great potentials for revolution, the stability of the overall system had to be secured by sustaining a permanent split of the workers following racial lines. The white workers were of course a willing party.

 

Manufacturing and trade capital also benefited from the disorganisation among African workers and the low standards segregation and apartheid had ensured for agriculture and the mining industry. Liberal researcher Heribert Adam accepted early on that apartheid for a long period allowed development of capitalistic growth at the expense of the Africans’ standard of living and social welfare.[58] The rapid growth in the manufacturing industry throughout the 1960s would perhaps have been less confusing to Lipton had she recognised the scope of the ties the business world had with the racist regime. In one passage, Lipton admits that:

“However, even progressive capital shared the belief that white hegemony was necessary for politi­cal sta­bility, the precondition for both economic growth and personal security.”[59]

However, the recognition of this fact apparently has no consequence for her attitude towards the relationship between capitalism and apartheid. The fact that owners of capital from various economic sectors never mounted a collective mass attack on the migrant system, never seriously challenged the reservation/Bantustan system and never insisted on full civil rights for blacks did not challenged Lipton's analysis. By focusing rather narrowly on job reservation, Lipton was able to persevere in an argument that would have been difficult to defend had greater consideration been shown for the total historical reality.

Capitalism and Apartheid builds on the conceptual separation of capitalism and apartheid. Capitalism stands on one side of Lipton's universe, isolated and separated in the various sectors. On the other side is apartheid, “...the system of legalised and institutionalised race discrimination and segregation,” pushed through by autonomous government power.[60]

 

The argument for the progressive role of capitalism started long before Lipton’s book of course.[61] The way I view it, it has nevertheless been proven beyond any reasonable doubt that the South African business world had a great share of the responsibility for the oppressive system.[62] Government power and apartheid were largely formed by economic forces, including the mining companies, the white unions, Afrikaner business people, white commercial agriculturalists, and even semi-progressive trade capitalists. Capitalism and apartheid were intricately inner-woven in South Africa.

Even if apartheid was not fascism, there were many common elements. Both systems were state terrorist solutions, necessary to stabilise a capitalism threatened by social dissatisfaction. In the case of apartheid, the racial split of the working class made it possible to maintain a limited parliamentarian system for parts of the population. Only when SA capitalism had developed to a level where it became possible to satisfy larger parts of the black population could the racial-social repression be reformed.

Lipton's analysis methodology pulls apart the pieces of history without putting them back together properly, and therefore is not well suited for a satisfying overall picture of the social processes in history.

The progressive role of capitalism for the development of productivity and invention should not be a problem for a Marxist to recognise, since Marx himself did that already in the Manifest.* The disagreement occurs when the consequences, expenses and injustices of development become clear.

It still seems to me that Merle Lipton is somewhat simplistic and deterministic in her view of the modernising effects of capitalism. There is a prize for industrialisation and modernisation and it is always the weakest who is paying the most. The peasants of Ukraine, and of Ireland, the forced labour in the European colonies and later on the away-rationalised unemployed industrial workers. There are natural conflicts of interest in this process and to some degree, also the historian has to choose side. In my opinion, some of the choices Lipton made for example on the question of sanctions were problematic.[63]

Lipton support “the capitalist system” in a “social democracy” form, and she is separating herself from Thatcherism for example, but her actual work is, in my opinion, a support for neo-liberal solutions with almost no focus on their negative social consequences. Even if Lipton does care about people killed, tortured and deprived of their property during apartheid, and even if she has made critical studies on the mining industry,[64] her main concern is not ordinary people extra-exploited by apartheids economic mechanisms.

The black population's resistance struggle against apartheid and capitalism has not really been an integrated part of Lipton's view of history or capitalism. Black discontent and protest is mentioned, yet never as an integral part of the book's discussion of capitalism and apartheid. Important events in South Africa's history, such as the mine worker strike of 1946, the passport and defiance campaigns of the 1950s that culminated in the suppression after the Sharpeville massacre, the general strikes in the early 1970s, the Soweto uprising and the protests that made black towns­hips ungovernable in the 1980s, are not convincingly integrated into Lipton's capitalism logic and she has not much understanding for the strong mix of national, ethnical and social mobilisation that was absolutely necessary to get rid of apartheid. Economic liberals still do not recognise this and they did not attribute much to it. I guess that Lipton has never given much credit to the use of history for creating the necessary idealism for liberation struggle and solidarity, but history is always used, so to some degree, the writer simply have to be aware, by which side she want to be used.

 

Lipton could have added greater relevance to her work, even without breaking from her fundamental view, by interpreting some of the events from black South African resistance mentioned above. For example by recocnizing that capitalistic growth combined with apartheid repressions fostered mass resistance among the black workers, which over the long-term threatened the social order. Or by recognizing that the changes in political power relations in society in favour of the black social movements therefore had great significance for the dynamics of change. In order to see and theorise such insights, however, attention needs to be shifted from capitalists to workers in the explanatory model for change.

The problems of genuineness of reforms during late apartheid might look like an academical question since formal apartheid was abolished in the end. However, for a historian, it is not unimportant to establish that until 1985, where it became clear that the tricameral parliamentary reform only had resulted in an indomitable, incredibly broad popular uprising, there was, not only in business or between liberalists, but also among many political liberals, not much enthusiasm for the parole of one person - one vote. When should one be satisfied with reform? It still seems to me that even relative contentment with the 1983-reform would have been very harmful for the possibilities of full democracy and non-racialism.

To which extent what has taken place in South Africa has been a betrayed or tamed negotiated revolution or it simply could be classified as reform is still very much debatable.

The question also arise of course, why capital should be against change of apartheid, if they were reassured that the basic structure of exploitation would be intact. For most black people the fight for social justice was just as important as the race struggle, and the amounting indifference with the democratic process at its present stage is probably caused by disappointment with growing economic inequality.

 

In my estimation, Lipton in her work with Capitalism and Apartheid was much inspired by radical research methods, Marxist analysis categories and a somewhat determinist materialistic structuralism, yet she has done her work based on a basic liberal viewpoint which makes her study unique, noteworthy logical and exciting, but also somewhat narrow and strangely distorted.

I recognise that most of the sources and facts put forward by Lipton are quite thoroughly researched. My main problem with Capitalism and Apartheid lies with the choice of sources, the angle, and the actual political and social effects of the book. That it is the interpretation of the facts that determines and parts the results of research is hardly surprising to a historian. Focus varies of course depending of whatever the important thing for the author is to improve relationships by harmonizing capital-worker relations, or to gain more social justice using history for mobilisation.

I like the book because it confronts the main structural problems in South African economic history in a direct and materialistic way. I admire Lipton’s will and courage to confront the radical structuralists on their own terms. I dislike the book because it has been useful to forces that did actually not want to promote the rights of the underprivileged in South Africa. They got an argument for “letting the market do the work”, not recognising the necessity of a militant, fully fledged social and national liberation struggle, without which the prominent conditions for building the new South Africa would not have been reached. That the ANC government has later misused these conditions for a neo-liberal and anti-social economic policy is another matter.

Lipton has in her counter critique accused the radicals for lowering the professional standards by an unbalanced approach that include over-referencing and a self-congratulatory, repetitive and sectarian work stile, and for imposing their own exclusive hegemony. Examples of such conduct are not hard to find, but it is definitely just as common between liberal scholars. Lipton’s way of labelling her radical opponents seems just as rigid as the early structuralists’ were. Most Marxists did not see systematic racism as a necessary element in capitalism. The people that Lipton sometimes refers to as “Stalinists” were often fully aware that their scheduled National Democratic Revolution would not get rid of capitalism even if it could end racialist dictatorship.

Yet as a whole, Lipton's research results have had great significance. They showed that owners of capital cannot all be measured by the same yardstick as supporters of apartheid and racist worker oppression. Rather, a distinction must be made between more or less progressive sectors of the business world. Lipton's work also challenged the radical school to an even greater extent to include studies of government administration and legislation, race attitudes and ethnicity, ideology and gender in a renewed non-reductionist Marxism.

The liberal tradition in South Africa contains many moral qualities, but also many unanswered questions, above all concerning the relationship between capitalism and apartheid. With formal apartheid abolished and the social order in continuing crisis (even though the situation due to general goodwill cannot be described as such at this point), where the African workers and unemployed could challenge also the more fundamentally economic assumptions and norms from which the society has been governed, liberalism in South Africa can hardly afford to leave these questions unanswered. Merle Lipton's work answered some questions concerning apartheid, but it did not give a full description of the racist South African capitalism. Later attempts from Lipton have been along the same methodological lines.[65] Nevertheless, her work is always rewarding to read and her renewed studies on the subject are highly welcomed.

 

Government and capital in South Africa - Yudelman's symbiosis theory

In South Africa, many serious discussions about the relationships between the business world and the government have been held under the banner of Economic growth and political change. The debate has thus largely been about to what degree the white employers and the form of economic growth with which they have identified themselves have been, or in the future will be, responsible for the creation, intensification, abolishment or continuation of racial discrimination within South Africa.

It is an important historical ideological debate, and both liberal and Marxist-inspired researchers have over time refined their arguments about the responsibility for apartheid and the means for its abolishment. Beginning in the mid-1980s one could sense a new approach to the debate about South Africa, which to a greater extent focused on the South African government’s legitimisation crisis, its lack of accepted authority, its immorality and its growing problems with performing entirely normal functions without the blatant use of force. This viewpoint, represented by David Yudelman among others, also looks backwards to liberal views prior to the radical revisionist breakthrough, and despite a very different regime in the new South Africa, certain sides of the argument continue to be extremely topical.

 

Yudelman's analysis of capital's policy

In Yudelman's opinion, the legitimisation crisis can only be understood through an analysis of South Africa's poorly appreciated, yet critical problem: the economy's growing difficulties with producing the necessary surplus and workplaces to support the grandiose social and political programs that the governments were even proposing during the last 20 years of the apartheid system. The crisis ranged further than the regime's acute economic problems such as sanctions, declines in investments and labour market turbulence. The inner economic structural crisis and its coincidence with the government power crisis made a new policy-forming role necessary for the business world. Yudelman believes that the owners of capital have always had a voice in political decisions, but the escalating mutually reinforcing economic and political crises and the government's weakness gave the business world growing influence on fundamental political changes where it had previously, at least publicly, been limited to reactions to government measures.[66]

The business world began to more openly exert influence on "horizontal" politics, i.e. broader national political questions that were not limited purely to business interests, but crossed societal sectors and interest groups. A visible result of the increased exertion of power could be seen in the attempt at implementing the government strategy for inward industrialisation, which, if completed successfully, could principally have reformed South Africa demographically and politically, as well as economically, without shaking the very foundations of the power structures. This inner industrialisation policy included, among other things, a softening of separate development by giving up influx control. However, it quickly proved to be too little too late. The popular mobilisation made such a simple perpetuation of the system through limited reforms impossible.

 

From a critical viewpoint Yudelman established that Poulantzas’s theoretical structuralist work was in reality to some degree compatible with the liberal interest group theory, the latter focusing on groups competition for control of the government and also with liberal thoughts of a nightwatchman state, where the government only has a minimal function in ensuring a stabile environment for freely competitive actors. Poulantzian theory, in Yudelman's opinion, mostly strives to translate this liberal ideology to Marxist terms.[67]

South African Poulantzians became known as fractionalists due to their emphasis on the element in Poulantzian theory that involves understanding government based on the internal struggles between dominant capital fractions. The dominant fractions of the bourgeoisie formed a power bloc characterised by inner competition for hegemony, which is why they from time to time seek support from classes outside of the bourgeoisie in order to pull through deadlocked situations. Such alliances can result in government policy that at first glance appear to contradict capital interests, yet benefit the business world over the long term.

One of the problems of using the fractionalists' theory on South Africa was its assertion of a very direct reflection from form of state to government functions. Everywhere the fractionalists noticed a change in government policy, they sought and found, changes in the form of government. Their periodisation of South African government was therefore filled with turning points, of which the changes in government in 1924 and 1948 were viewed as the most significant. A view that, isolated by itself, many liberal historians also share. This analytical focus on 1924 and 1948 probably placed too much significance on party politics, groupings in capital and government, and fractures in government-capital relationships.

Various commentators have noted the common points between the fractionalists and certain liberals in this area, including several orthodox Marxists who scoffed at Poulantzian fractionalism as liberally-influenced mystification. Merle Lipton's modern liberal analysis work, reviewed in the first half of this chapter, emphasises the victory of national interests over foreign capital and the victory of agriculture and white workers over the mining companies as fundamental to understanding apartheid, thus has a number of common points with Poulantzian structuralism. Yet she does not put the burden of racial discriminatory policy on the shoulders of capital. Both the fractionalists and Lipton, however, to some degree views the government as an instrument for diverging interests groups, and both viewpoints perhaps exacerbate the problem by attributing too much power to the sectors, which for some time were less developed, the manufacturing industry and agriculture, compared to the mining companies.

 

Yudelman's capital-state symbiosis

Well into the debate about government and capital, Yudelman lodged detailed criticism at the governmental theories mentioned above, including a focus on the mentioned turning points, and proposed an alternative theory emphasising concepts surrounding government legitimisation, capital accumulation and a resulting symbiotic relationship between government and capital.[68] Yudelman's ideology included and drew together theoretical works of James O’Connor and Jürgen Habermas, among others, and made a Weberist distinction between the state on the one side, including legislation, public service, courts, law enforcement, the army, etc., and current government policy on the other. The point of departure was an explanation of the state, first and foremost a detailed empirical depiction of the South African kind of state, focusing in particular on its relationship to capital and the organised workers.

Yudelman's study results suggested that the South African government fairly early on was confronted with the necessity of dissolving tensions between labour and capital. In order to mobilise the political backwaters and gain at least minimal acceptance, it was necessary for the government to legitimise itself to the white population. This goal was achieved, not only through the development of a collective ideology, but also through limited representative institutions, controllable unions and the privileged right to vote. At the same time, it was necessary for the government to ensure continued economic growth and its own tax basis through continued capital accumulation. As the government needed to use private initiative to optimise the capital accumulation function, and as capital needed to use the government to legitimise the societal norm within which it was functioning, the natural result was mutual dependency. This symbiotic relationship was thus not a relationship between dominating and dominated parties with absolute power divisions. The mutual dependence did not necessarily involve any equality, either. With Yudelman, the relationship between government and capital is more than just instrumental, government is thus not viewed purely as representing capital interests, nor only mediating with the government as the neutral judge between conflicting interests, of which capital is only one.

Yudelman believes that both liberal, Marxist and nationalist views of government, contrary to his own explicitly symbiotic theory, view government as representative for one power or another, whether it be the general interest, one particular class or an ethnic group. Yudelman's symbiosis on the other hand involves government being viewed as an independent actor, if not entirely autonomous. In contrast to the Poulantzian concept of relative autonomy, which does not extend beyond what in capital's long-term interest, Yudelman rules no options out. The concept of symbiosis involves government being able to represent itself and its supporters, and make choices where conflicts lie. The symbiosis does not make conflicts between competing groups predictable, yet suggests a mutual dependence, which will survive most clashes, regardless of how bitter they may appear in public debate. Therefore, Yudelman's symbiosis survives most instances also where important choices has to be made, as well as most historical turning points, for which he also, as a logical result of the symbiosis theory, has a hard time finding examples. The symbiosis between government and capital has on the contrary a long continuous history that reaches back to long before South Africa was united in 1910 and which, despite changes, is viewed as unbroken. Only a fundamental and lasting breakdown of the government's ability to ensure social legitimatization and capital accumulation could pose a true challenge to the symbiosis, and that could not be predicted to occur in connection with the abolition of apartheid.

 

Yudelman's The Emergence of Modern South Africa was one of the most noteworthy works from the 1970s and 80s on South Africa's political economy from a historical perspective, and the book helped to heat up the historiographical discussion. The author postulates that his study creates a new view of history by dismissing the conventional view that, among other things, the Pact Government of 1924 was a significant turning point in South Africa's history:

“This study rejects the turning point theory and attempts to place the Pact’s election in an entirely new perspective which is a radical departure from the literature, and the reader should be warned that it implies (and even necessitates) a broad revision of twentieth century South African history as a whole.”[69]

David Yudelman's basic line of argument in the work was that the key to understanding the course of history in the segregation period from 1902 to 1939 was an ever-growing symbiosis between the mining companies and government power, the purpose of which was to subordinate and control the organised working class, which was necessary to make the mines profitable and ensure the state a badly needed financial basis through taxation of the mining surpluses.

 

Viewed from Yudelman's standpoint, mining capital was the totally dominant force in South African industry, and its profitability was so decisive for maintaining the balance of payments and for creating demand for agriculture and manufacturing industry products, that its central role within the government life is obvious. Yet is important to Yudelman to define government as an independent actor, under which he distances himself from Marxists analysts, who in his opinion view government “merely as an instrument or representative in the hands of one or other group or class” and thereby “misconceptualize the political process as fundamentally as do the turning point theories.”

He himself views the government as a mixture of “continuous administrative, legal, bureaucratic and coercive systems,” which together represent a public authority: an independent actor in the struggle for power, rather than a basic power instrument for competing classes or class fractions. This basis enables him to not pay much heed to radical structuralism hypotheses on fraction struggles within government and instead offer an alternative, and in a way more elegant, definition of the conflicts of interests. Yudelman raises many painful questions about radical structuralist thinking and seriously calls into question its analytical use value. Still, Yudelman's book could not have been written without the preliminary work of the structuralists.

 

The book's empirical strength lays in the fact that Yudelman's isolation of the government and the mining industry as the two main actors in history allow him to demarcate a fairly precise field from which to work, and to investigate this in depth using materials from parliamentary commissions, newspapers and confidential unpublished materials from the parties.

What is interesting is that even though Yudelman's point of departure is explicit distancing from the radicals, a number of his conclusions are in reality closer to their logic than that of the conventional liberal school. One example of this is his merciless treatment of the Chamber of Mines, and occasionally the mining industry as such. Another is his critique of the relative overestimation of the importance of race relations to South African historiography. Davenport, however, has noted that Yudelman's critique is not an attempt to upgrade the importance of class factors, but must be viewed in connection with a general argument that South Africa's industrialisation, from a global perspective, was not as divergent and unique as generally presumed.[70]

In his perception of “colour bar”, Yudelman differentiates between:

• The “statutory colour bar”, as established in Mines and Works Regulations, among other places.
• Habitual, culturally-conditioned racial barriers that existed independently of legislation.
• A so-called “status quo colour bar” based on the accord with the white workers of 1918, among other things.[71]

This construction seems too weak, however, to support a confrontation with Johnstone's analytical differentiation between “exploitation colour bar” and “job colour bar”.[72] Yudelman is inclined to view the Rand Revolt of 1922 as a result of the mining capitalists' conscious attack on racial discrimination as such, a confrontation met by the mixed fanatical racism of the white workers. Up to that point, he apparently agrees with Lipton. By the same token, Yudelman delivers an extrapolated argument against Johnstone's idea that the white workers became racists because the “exploitation colour bar” forced them into that position.[73] The examples Yudelman gives when he attempts to justify the occasional white worker offensives to strengthen the job colour bar, however, in reality suggest that they were in a defensive situation.[74]

Yudelman convincingly argues that the government and the mining companies first found each other during the so-called “reconstruction era”, i.e. the period immediately following the Boer War, and established an actual collaboration after Louis Botha took office as prime minister in 1907 under the British-controlled “responsible government” arrangement. Here Yudelman supports himself on P.C. Grey's dissertation from 1969. Peter Richardson's later studies of the decision-making process around importing cheap Chinese mine workers supports Yudelman.[75] Allan Jeeves does the same in his articles on Botha's collaboration with Chamber of Mines.[76]

A fresh, but maybe dubious, element of Yudelman's historical analysis comes through in his view of the predominantly white general strikes in 1913-14, which he views as a greater, more threatening, crisis for the government than the 1922 revolt. While Katz in her defence for the strike leaders maintained that their goal was more reform than revolution,[77] Yudelman views them as a serious threat against the system and believes that they overlooked a unique opportunity to overthrow state power, while the oppression apparatus of was in very poor condition. If this really was the case, Yudelman is probably right that the government's subsequent security measures, both right up to and after the 1914 general strike, including the adoption of the Riotous Assemblies Act, the creation of paramilitary security forces, “citizen commandos”, and the unconstitutional deportation of the leadership of the Federation of Trades union were of great constituency importance for similar wielding of power in the future. The alliance between the government and mining capitalists held the course and dismissed a serious challenge to the system's authority. Yudelman accompanies this assertion with comments on the irrelevance these class struggles had for black workers at this stage of the proletarianisation process, and on the inability of white workers and Afrikaner nationalists to create a collaboration that would threaten the government at that point in time. Yudelman's observations on the relationship between Afrikaner nationalists and white workers are absorbing because most historians have tended to view this relationship and its culmination in the Pact Government of 1924 as established and unproblematic. Yudelman's assertion of the fragility of the alliance long after 1914 and of Afrikaner nationalism's actual very slight agreement with the white worker struggle, explains a great deal of the Pact Government's fluctuating policy during the period of 1923-29. Yudelman himself appears to view the analysis of the Pact Government as the most original breakthrough of his book. One should probably be sceptical towards dismissing entirely the 1924 pact as a turning point as Yudelman actually does, yet his analysis makes it clear that previously unproblematic views of the Afrikaner's advance in 1924 did not sufficiently take into account the differences in interests between white skilled workers and poor whites, and between a government consisting of agrarian interests and a mining industry that was particularly invaluable for foreign trade. Yudelman carefully distinguishes between the ideological fanfares of the Hertzog government and the policy it actually pursued.

Merle Lipton on her side can present a series of statements to support the power of white workers:

“White workers won, not because of their industrial power...but because of their political power. This secured the election of the 1924 Nationalist-Labour Pact...The subsequent declining militancy of white workers was not because they had been politically castrated, but because they could get what they wanted by easier, institutionalized means.”[78]

In opposition to Lipton, Yudelman dismisses her idea that mining companies won the battle against the white workers in 1922, yet lost the war against the job colour bar in 1924. On the contrary, his point is that it was the public sector and manufacturing industry that paid most for the luxury that was “civilized labour policy's” high white wages. It was not the mining companies that at no time were forced to retreat completely into the situation of the “status quo agreement” of 1918.

While maintaining his own originality in connection with this view of the Pact Government meeting mining industry interests before those of the workers and farmers, it seems that Yudelman overestimates Robert Davies' work in particular. Yudelman's research results on Smuts' generally negative attitude towards welfare development for white workers and towards the initial acceptance of organised white workers under the previous Hertzog governments through the Industrial Conciliation Act of 1924, are in all matters of importance in agreement with Davies discussion of the bureaucratisation of white worker organisations under the Pact Government.[79] The main difference between Davies and Yudelman's analyses was thus not so much their interpretations of the conflicts between interest groups, although Yudelman refused to take Davies' differentiation between competing capital fractions seriously, but the diverging views on the nature of state power. Davies viewed government as national capital's most important instrument. For Yudelman the state was an active, but not the only, agent for handling public power with regard to the dominant groups in the society as it promoted the collective interests of these groups, encouraged their supporters and oppressed or co-opted potentially undermining elements.

Yudelman believes that the white workers had become so destroyed by the military and law enforcement defeat of 1922, that they never again became a real power factor. The view seems to rather unreflectively follow that idea that the white working class was restrained by the presence of an alternative under-paid black labour force, also described by Greenberg.[80] Yet while Greenberg on this point focuses on the fate of the black workers, Yudelman concentrates on the skilled whites.

Yudelman documents that the mining companies and the government did not grow farther apart from each other under the Pact Government, even though public acknowledgements from both sides, among other things in connection with the parliament debate on the Wage Bill, suggests more irreconcilable differences. Yet he shows that it was under the Coalition Government of 1934 that the collaboration between these parties began in earnest. The basis for the collaboration was a rise in the price of gold that put the government in a position to raise taxes on mining company surpluses without particularly limiting dividends.

A great deal of the argument in Yudelman's book concerns the legitimisation of the South African government towards the gold mining industry, which is viewed as the economic giant; without its backing the national capital could hardly have survived. The most problematic crisis period in this legitimisation process is set at the period between 1907 and 1924. Around 1932, the symbiosis between government and mining capital reached a stabile maturity that was not effectively challenged until the black worker movement of the 1970s developed the same authority the white working class had in the first years following the union creation.

 

Yudelman's view of the white worker position in history

In contrast to then Poulantzian structuralist Davies, and to Lipton, Yudelman believes that the costs of employer privileges were carried to some extent by white mineworkers. Even though they were among the most well paid white workers, they were left with a decapacitated union, characterised by stagnating membership numbers and rising corruption, and with a labour law system that made effective strikes impossible. Although the mining industry expanded after 1924, the Pact Government did not improve terms of employment or wages for white mine workers compared to the South Africa Party term of government. He estimates that their real income actually dropped. Yudelman even asserts that white mine workers also lost ground in relation to the black workers in the sense that relatively more blacks were hired under the Pact Government term than prior to the 1922 uprising. The government, which gave the mine owners the right to continue recruiting black workers from foreign countries, had to attempt to create employment for the poor whites in the government sectors rather than in the mines, even though the latter was more labour intensive. Frankel's in-depth, economical statistical studies of the profitability of the gold mining industry agree with Yudelman. They prove convincingly that the mining industry did nicely during the entire industrialisation period.[81]

In Yudelman's symbiotic view of history, it is thus necessary to view the institutional ties between the business world and the government within the larger context of structural ties between state and capital. The mining sector had to keep a low profile on the political level due to concerns for white worker voter sentiments. The government had no burning desire to favour the miners especially, yet felt obliged to show this consideration because the mines, due to their macro-economic position, enjoyed the best access to the government on the higher, structural level; something that would not have been particularly popular with the voters if it had been too apparent.

 

Yudelman's work still stands out as one of the most impressive analyses of the relationships between capital, labour and government, and was later followed by similar works.[82] The postscript shows the relevance the historical situation has for the present, in this case the formation of the modern South African nation state. At the time of writing, the early 1980s, the author views the South African apartheid government of the day as caught in the same type of dilemma as the Union Government of 1914, with somewhat similar options. Either a quick and consequential development of a social state, this time with the socialisation of the entire population under one consequent distribution policy; or alternatively, privatisation and deregulation under free market conditions and a relinquishment of the government's responsibility for the individual.[83] It would become apparent that this choice could not be made under the apartheid regime and based on Yudelman's logic, has not yet been made despite some attempts.

 

Method's for analysis of how power manifested itself in market and government

Stanley Greenberg has compared the ethnically divided South Africa to other capitalistic societies, which, during development, have attempted to separate economics and politics by minimising the government's direct role in the market. It proved to be the case that the market, mainly in split societies, has often been used as an alternative to open wielding of government power in political matters. Greenberg's emphasis is that as the capitalistic society and modern markets were gradually developed, there was an almost universal tendency towards greater separation and differentiation between government and economy. Such socio-economic development most often coincides with at least four ideology-forming and consciousness-forming processes: Greater separation of politics and economics, development of the separate private sphere, actual (but not obvious) reduction of the political element in society, and universalising the government.

Government responsibility for producing material welfare diminishes parallel to market expansion during late capitalism, a retreat that allows government to liberate itself from many ungrateful problem-areas, while at the same time allege overall responsibility for the society as such.[84]

In split societies going through reform development, the previous regime's ideology has often worked and achieved results for special interests through government intervention, which, for example, was the nucleus of apartheid. This previous interventionism can exacerbate the problems of government diminishment and attempts at market ideological legitimisation. Jan Lombard proposed one possible solution to this dilemma in the form of decentralisation and power division, containing a regionalisation where regard is shown for traditional power groups.[85] As proved to be the case during the democratisation process in South Africa, the freedom movement organisation has been fairly sceptical towards such solutions due to a fear of continued use of divide and conquer policies by previous power groups in defence of privileges. After the ANC took over power, elements of this model were nevertheless implemented.

 

As previously mentioned, government played a more direct role in the production sector in South Africa than in most other industrialised economics at the same developmental level. During the 1980s, it produced between 20 and 30 percent of the GNP even with a limited service sector, and was deeply involved as a producing industrial actor. With monetarian inspiration, it was the government's intention since the mid 1980s to privatise within several production sectors, and, as early as that point, it began selling off stocks in the synthetic oil industry, SASOIL, among others, without entirely giving up control. In reality, one could view the ANC government privatisation policy as a continuance of this strategy.

 

Yudelman postulates that Afrikaner capital's relatively larger contributions to the government's need for legitimisation (e.g. in the form of moral rearmament) compared to the relatively larger contributions by British capital to the government's need for capital accumulation led to different policy views, including Afrikaner capital acceptance of direct government participation in the economy. Afrikaner capital entered the mining industry rather late with the Federale Mynbou takeover of General Mining in the early 1960s. Oppenheimer, actual leader of British capitalism, encouraged this step because he hoped for a closer relationship between the mining industry and the government. Still, Yudelman believes that the high degree of centralisation and concentration of capital in South Africa, dominated by two large conglomerates, Anglo-American/De Beers and Sanlam/Federale Mynbou/Gencor, made it easier for the South African business world to speak with one voice than was the case in most other places.[86]

 

Yudelman makes a somewhat artificial methodological distinction between levels of analysis categories with the business world /government on one level and capital / state on another, based on differences in levels of operations and abstractions. Business world / government relationships are best studied on the public institutional level by outlining, among other things, party political discussions and published statements from business world unions, corporation boards, government leaders and bureaucrats. At this level, there is a public debate between observable, defined institutions. State / capital ties, on the other hand, are best studied at the structural level. Structural ties are in their very nature not so obvious and therefore harder to define. These economic relationships with politics are best studied at the macro level. From this point of departure, Yudelman for instance believes that most researchers in the historian debate over the colour bar in the mines have concentrated their studies on public institutional exchanges. Liberals, white and black nationalists, and a surprising number of neo-Marxists as well, are in his opinion also guilty of this lapse and of ignoring the fact that “politics is the means by which the will of the few becomes the will of the many.” Yudelman believes that this is a transgression in many regards. It leads to a misleading view of the relative strength between the factors. Government and state lose their legitimacy when they publicly bow to special interests, and capital shares government's interest in not being caught serving their own interests which conflict with the general good. In addition, overemphasising the political will frequently lead to a misconception of the relationship between capital interests and government power because, among other things, the parliamentary political process under this is set up as an opposition, i.e. the one between government and its opposition, while this relationship, according to Yudelman, is most often fundamentally symbolic. In principle, however, Yudelman believes that the defining dominance of politics or economics respectively can only be determined on the empirical study level, and not as an a priori assertion.

 

The tendency to over-exaggerate the importance of the political process and ignore the framework of profit interests behind is, quite rightly, very common to many South African studies, which Yudelmans work shows numerous times.[87] This analytical weakness is quite common, but often goes unacknowledged. Not only does it distort views of past and present, it also strikes at strategies for the future.

Merle Lipton’s work is a good illustration of the significance this problem has for understanding the government/capital relationship, and for the view of liberalism's potential in South Africa's future. Merle Lipton's research is very talented, it is actually substantially better than most and is absorbing because it had the opportunity to build on a long series of earlier works on the subject, and because it is ambitious, both in its scope and breadth. Lipton does not ignore capital interests, but she interprets them too uncritical. As previously mentioned, Lipton stated that the mining industry's inability to undermine the colour bar in the 1920s demonstrated its lack of political power:

“...the mineowners’ desire for profits overcame any personal preference they had for employing whites. Hence their repeated attempts to erode the job bar. Their failure was due to their lack of political power. The disbelief of Marxists that the leading capitalists could be politically weak largely accounts for their insistence that they must have wanted the job bar.”[88]

In other words, the mining industry was forced to subordinate itself to government policy, even in its most important areas of interest. Capital can make recommendations, but the government holds sway.

However, it is only through limiting the explanation of political power to the public political level and by underemphasising mining capital's political economical significance that it become easy to prove such a point. On the structural level, Lipton to some degree neglects to include basic government/capital relationships in her deeper investigations. As regards the colour bar, many of the costs were quietly reverted back to capital, including the mines. Even though the mines had job reservation, they were widely exempt from the burden of “civilized labour policy”, which in other sectors ensured an even greater level of white employment with good wages. The mines held the exclusive right to bring black migrant workers in from abroad, and they were not forced to subordinate themselves to the wage determination of the industrial council system.

 

Yudelman asked why so many from all trends within historiography have narrowly viewed government as an instrument for capital, or conversely, as architect/engineer of the business world. His own answer was: because both liberal academicians and the Poulantzian fractionalists viewed the question of political power on a narrow institutional, public, governmental level. When, for example, the minister in parliament said that the colour bar would be upheld regardless of how much the mining companies objected, this is misinterpreted as a source of proof of the mining companies' powerlessness, while the secret under-the-table agreements of the structural symbiosis cannot be documented, and are therefore of no interest to a tradition-bound, orthodox historian.

Until 1986, when Lipton's book was published and most of the “statutory colour bar” was abolished in the mines, the legitimisation problem remained, as Yudelman describes it, in many ways unchanged. Until the white minority control was relinquished once and for all, the government had to balance its white parliamentary support with maintaining privileges and job security for white workers on the one side, and regard for mining company tax contributions on the other. The greatest change from the mid 1980s on was that both government and capital became more involved in legitimising themselves to the newly organised black workers and to a critical, sanctioning world.

 

Why is it that the influence of the mining industry and the rest of the business world on political life is most often played down, even though the opportunities for exerting this influence was always present on the structural level? All the while, the mining conglomerates have always been among the handful of companies that have almost entirely dominated Johannesburg's stock exchange. Throughout many years, Anglo-American alone controlled more than half of all stock on the JSE. In the media and the business world itself, with a few exceptions such as the Urban Foundation, political power has been defined as the ability to win in public debate and achieve ones goals in full openness. Very open influence from the business world was not acceptable to the government of a system where the wage earners, despite everything, had more votes in the elections than the employers. It has been advantageous for the system's cohesive power, i.e. both the business world and the government, to portray the vast business world as one interest group among many others that was subordinate to policy. The government in power must then take the blame for any problems in the economic basis.

Thus, to some degree, it was a matter of a conspiracy between the business world and the government in their close liaisons. When government ideology approaches new liberal market thinking, as has been the trend in South Africa since the 1980s, it paradoxically becomes increasingly difficult to deny the structural alliance. Yet it can become necessary for the government to make this special relationship known as a positive element. It is ironic that the political crisis in South Africa beginning in the mid 1980s incited the business world to take a symbolic distance from a highly right-oriented government. Even during and after apartheid's last crisis-filled period, it would probably be a misunderstanding to interpret this course of distancing as a termination of the above-mentioned, more or less disguised, collaboration.

 

Yudelman's view of more contemporary legitimisation problems

During most of this century, the above-mentioned symbiotic collaboration, combined with a co-opted white working class, proved to be viable. However, it was difficult to place the growing free black union movement within this model. Throughout the last two decades of apartheid, the union movement, together with the rest of the freedom movement, developed what Yudelman (with a somewhat unlucky phrase) calls a “third force” in South Africa, with a powerful political economic pressure basis. The lack of development of social liberal and reformist attitudes among the black workers made it constantly difficult to include them as a socially stabilising element, and this will likely prove to be the problem in the future too unless a large number of them can be offered real material progress within the framework of the new regime.

Yudelman's symbiosis has been criticised for being too broad and elastic compared to other group or class representation theories. On the other hand, many have viewed the elasticity as desirable in a time when social science has almost given up searching for universal explanations. Mainly because it neither hides differences or overemphasis similarities.

According to the works by Yudelman discussed here, written before the formal abolishment of apartheid, there are, however, real threats to the symbiosis. Due to its inability to control the situation, the South African government, during the last years of apartheid reform policy, was confronted with a dramatic disintegration of the traditionally strong support of the white workers and lower Afrikaner middle class, together with the escalation of its confrontation with a militant black population, which, also in Yudelman's opinion, could indicate a break-up of the state. He defined this as a legitimisation crisis, which both included inacceptance of the South African government's moral authority and a pro-active attack on its very viability. This legitimisation crisis forced the South African government to look for the declared support of other circles, including first and foremost the liberal-minded parts of the business world.

In Yudelman's opinion, large-scale capital did not take an openly declared role until the latest years of apartheid after being apparently absent from the public political picture since the 1920s. While it could previously lean back with confidence in the government and state as stabilising for the economy, the business world became increasingly concerned that the legitimisation crisis threatened the future of capitalism itself and the free initiative system in southern Africa. However, as late as 1987, Yudelman did not regard this threat as immediate.[89] Even though the relationship between the business world and the government were undergoing change, he viewed it as still being symbiotic, and a breakthrough for the international economic sanctions, and the resulting development of a siege economy would sooner strengthen than weaken the symbiosis.

The South African government crisis from the early 1980s on was thus a legitimisation rather than cyclical crisis. This not only meant that the ideology had to be reformulated, but also required the recreation of an effective political power, mainly in regards to inclusions and alliance policy. Throughout the 1920s and 30s, the South African government was good at including and depoliticising the white workers. How could this process be repeated for the blacks? This would demand an even greater degree of government intervention in a period where the ruling circles, under the impression of new liberalism, preached the opposite.

Free market ideology, already well on its way to replacing apartheid ideology, argued for a diminishing role of the government in the economy. Growing acceptance of this way of viewing the world perhaps even reflected a cynical recognition of, and mobilisation against, heavy government intervention, which during the century was used so successfully where the poor whites were concerned, and within a short period of time could again become necessary now to the benefit of the blacks, with sharply rising public expenditures as a result.

At the end of the 1980s, Yudelman proposed three possible responses to this challenge:

A.     Expanded use of force, which in light of the growing black politicalisation would mean open civil war and an almost complete abolishment of the government's legitimacy.

B.     An attempt could be made with the costly method that relatively rich societies in Western Europe used during the post-war period, and which radically increased government micro-economic intervention, thereby bringing about welfare legitimisation.

C.     The government's role in the economy could be minimised with confidence in free market mechanisms, where supply and demand, possibly through collective bargaining, determines wage levels, employment and welfare. In theory, this strategy should be able to create depoliticised zones, in which economic or administrative solutions dominate.

The first two options would be especially costly to implement. The third option would be problematic because governments always have a difficult time weakening themselves, and a liberalist ideology must be followed by an implemented free market policy. Still, it was attractive to reformers of the late apartheid period. The actual goal of government reduction would be to free the government of its political responsibility for socio-economic problems such as continued low wages and rising unemployment, thereby forestalling serious threats to the legitimisation process and removing governmental jurisdiction from areas, which, under an entirely or partially black government, could represent threats against primarily white-owned large-scale capital. Neither discrete supporters of apartheid reforms nor the owners of capital wanted to see black government power redistribute riches and economic influence just as effectively as the Afrikaner nationalists had previously done.

 

Yudelman identified some important common traits in the changes within the South African state - capital relationship, during the previous segregation period and under apartheid's reform period respectively, and outlined the role liberalism played in these processes. As mentioned, he investigated changes both on the institutional public debate level and on the structural level.

In regards to the first level, during the last 15 years of apartheid, clearly the government actively and openly courted the business world. For example, the top leadership conference at the Carlton Hotel in Johannesburg in November 1979, the Good Hope conferences in Cape Town in November 1981, and in Pretoria in November 1986, as the most public reflections of a extensive exchange of ideas.

Gradually as the political crisis grew, the business world was, on the contrary, increasingly preoccupied with putting a distance between itself and the government, mainly out of concern for global sanctions and declines in investments, and out of fear that capitalism would, in the eyes of the black workers, continue to be identified with apartheid and racial discrimination. In earlier periods, when the government had control of the situation and performed its legitimisation functions, capital stuck to its economic role in the business world, on the surface in any case. The exceptions to this rule, i.e. the powerful open political intervention from business, all follow the same line: they take place precisely when the legitimisation process, and thereby the state itself, is threatened, such as during the black mine workers conflict in 1920, the Sharpeville unrest, the Soweto uprising and the states of emergency in 1984-86.

 

The long duration of apartheid’s final crisis, and the many unsuccessful attempts by the government to re-establish its legitimisation function, led to even more open intervention from business within the political sphere. Most of these were of purely rhetorical character, and had the goal of freeing the business world of its responsibility for the regime's actions. During the last years of apartheid, however, the business world began to threaten with more direct action. The chairman of the board for a leading industry group, for example, threatened with an investment strike and tax evasion in an international financial publication under the headline “Big Business Prepares for Change,”[90] and there was the meeting between business leaders and ANC leaders in Lusaka. Many statements from business world organisations expressed growing criticism of the government during the last years prior to Nelson Mandela's release, when Botha's attempts at reform became deadlocked in uprisings, states of emergency and renewed oppression. The leading financial publication praised the government for abolishing influx control, yet on that same page brutally attacked the state president:

“We don’t need another Carlton or Good Hope conference...We need to get down and reform the law, not listen to more of P.W.’s jaw.”[91]

Thus, there were rifts in the business world/government relationship for several years prior to the breakdown of apartheid. The question is, however, whether the business world would have an easier time living with a government that took the radical steps towards establishing the government's legitimisation with the people. In 1987, Yudelman predicted that the state / capital symbiosis would continue under all circumstances, at least in the intermediate term, but he was not particularly optimistic regarding democratic, representative development. He believed that the so-called "Chilean choice", i.e. the alliance between a powerful, authoritarian government and unimpeded capitalism, could continue to be an actual possibility for a new South Africa, but he saw at least two main problems with that:

              I.      That would not meet the government's needs for the legitimacy it was missing with the radicalised black majority.

           II.      Raw power would no longer be enough to keep society functioning, and the state / capital symbiosis in itself also began to seem inadequate to hold the political sphere together.

 

Yudelman envisioned a solution where the black union movement within the framework of a decade, could be brought into a "corporatist" or "tripartite" model in which the government, leading capitalists and organised workers could find each other in a temporary modus vivendi.

In this scenario, Yudelman differentiated between the roles of liberals and liberalism respectively. Here he saw a group of liberals, who to begin with would be occupied with the realisation of individual human rights and the moral aspects of racial discrimination, which he labelled as political liberals. In the other wing, he saw liberals, who would primarily be occupied with economic freedom, the market's precedence and limiting the government's economic role, which he called economic liberals. He saw an occasional, but not necessary, coincidence between the two groups.[92]

If this differentiation is used as a basis, it must be established that the politically liberal, until quite recently, have constituted a small minority with no actual power basis, except for limited areas such as universities and press. Therefore, those actually striving for politically feasible alternatives sought support from the business world.

 

Even though the present democratic South African government follows up on the course towards a free market economy, the situation, however, continues to be problematic in principle for political liberals. In the same way as an apartheid government hardly would have been capable of ensuring continued privileges for white Afrikaners under free competition and market conditions, a liberally oriented government could not guarantee poor blacks a good standard of living. Economic liberals would agree with liberalisation anyway of course, yet political liberals will be put into a painful dilemma. They will have to make a choice between liberalism and social democracy, a choice they have been comfortably free from making until recently, due to the irrelevance of the latter ideology to hitherto South African conditions. Here Yudelman argues that the best the liberals can do is to aim for a “neo-laissez-faire” alternative, or a “liberal statist” solution.[93] Such a government model could combine continued, even augmented, government engagement and intervention in some areas, with market freedom in others. This model seems to be a social democratic adaptation and rather in contradiction to the Chilean possibility. In any case, South Africa's contentious liberalism will have to be revised rather fundamentally if it is to remain relevant for the future. In view of the old South African regime's inability to gain even marginal acceptance as representing society as such over the long term, it may possibly be necessary to go far beyond “liberal statism”. The unenviable task for the next generation of South African liberals could be to search for a role within a perhaps fairly authoritarian social reform policy as administrator/mediator between the government, large-scale capital, and powerful socialist unions; a mediation that could continue to be made difficult by both African and Afrikaner extremism.

 

Even though Yudelman is far from what can be called Marxist, he sees great problems for the implementation of a successful market strategy in South Africa, in a climate that, despite the psychologically staged optimism, continues to be characterised by economic crisis, criminality and violence. On the other hand, he could not find viable alternatives to a free market economy.

Even though Yudelman, like many of the radical revisionists, builds upon a structuralist analysis methodology, he distances himself from these by taking his basis in a predominantly liberal universe. Even though Yudelman, like Lipton, also tends towards structuralist liberalism, he distinguishes himself from her and previous liberal determinists, by acknowledging historically that the business world all the time had great political influence on the hidden structural level.

 

The problems of crises and change in directions in important political arenas, however, cannot be limited to the Afrikaner nationalists and the liberals. First and foremost, the Marxists, who probably had more political and practical influence during the 1970s and 80s than now, must do some painful soul searching, and many former radicals have been doing that for some time. The Marxists' central argument was that apartheid and the limitations on market freedom not only were in accordance with capitalistic economic growth in South Africa, but were also contributing factors to that growth. The Marxists now need to develop new convincing explanations for why popular black activism should focus on socialist reforms. If capitalism and race discrimination are not inseparable, then SA socialism's most important rationale will have to be based on something other than basic anti-racism.

The relationship between state and capital in modern day South Africa is undergoing change through many-faceted and fleeting processes, the understanding of which presupposes the development of new conceptual guides. This will also necessitate creatively doing away with obsolete approaches.

 

The postulation by Lipton and others that institutionalised apartheid was almost abolished before 1990 hardly gives a fair picture. It is too narrow only to focus on the legalised pillars of apartheid. In a broader understanding, freedom struggle was present in South Africa long before 1948, just as resistance against racialist capitalist extra-exploitation is far from over. Black workers are still ranked at a lover level than whites with accordingly lover salaries. Given the social gaps and working class traditions in SA, it is probably only a time-question when large-scale social mobilisation will surface again. This is the main reason, why the liberal-radical debate is not over. The weakness of the debate is manly a result of a lack of alternative socialist visions. The reason that the path in South Africa became reformist was not the role of the business organisations, but the lack of alternatives.

This debate has been quite ruff and liberals are right that engaged radicals often stroke a warlike tone in the attempt of mobilising the black workers. To the extent that this hostility was directed against supporters of apartheid, I sincerely hope that it was painful, but in the light of the victory over apartheid, it is of course easier to see that it was sometimes unjust to humane liberals.

It is in this connection interesting to discover that many liberals, like Lipton, do not make much of an effort to distinguish between early liberal segregationist, well meaning political liberals (social democrats) economic liberalists etc. Actually, they use the most enlightened liberals to throw credibility to the whole lot.

Was liberal pragmatism harmful? Deliberately or not, politically important research results will be used, so in one way or another, the scholar will act as an “activist”. In my opinion, every factor, which weakened the ANC lead Freedom Alliance, also made third force violence and civil war more likely. Lipton’s work for example, which strengthened economic liberalism and undermined radical socialism, might unwillingly have helped apartheid forces prolonging the pain.

In the present situation, “social democratic” research could actually give strength to a neo-liberal policy, which could throw millions of more South Africans out into unemployment.

Some of the conflicts in South Africa, which the liberals claimed they wanted to avoid, were necessary and unavoidable. Actually, they still are, which is exactly why the debate is still topical.

The long academic strife between liberals and Marxists over the relationship between capitalism and apartheid should thus be developed productively around central contexts concerning the relationships between government, capital and popular movements in the South Africa of the future.