It will be counter productive to limit solutions to wage increases, mass dismissals and fiddling with collective bargaining structures because South Africa needs policies that empower the black majority and improve mass quality education together with a coalition of all stakeholders for growth.

William Gumede, author of the recently published Restless Nation: Making Sense of Troubled Times (Tafelberg), wrote the article Growth coalitions the answer to a perfect storm of crises which was first published in Business Day yesterday and these are some extracts.

THE violent protests at Lonmin’s Marikana mine and the farm unrest raging through the Western Cape wine belt are not just a labour market crisis but a perfect storm of a number of crises — political, economic and labour market — all coalescing at the same time.   A solution limited to wage increases only, firing workers en masse or tightening or loosening central bargaining will be terribly counterproductive.

Economic growth in South Africa has been too sluggish over the past few years to increase the rate of job creation, reduce poverty and create wealth.   Economic growth has been mostly jobless and not inclusive.   It has reinforced the inequality of race, class and opportunity.

At the same time, there is the failure of the state to deliver effective public services.   One can call these public services a “social wage”.   This means that during these hard times, it is not capable of providing a cushion through such a “social wage”.

However, as state failure increases and the “social wage” shrinks, workers try to secure higher wages to compensate — to pay for rising public transport, education and housing costs.

But ordinary people have also lost faith in the institutions and arrangements that underpin the post-1994 social contract, such as Parliament, the collective bargaining system and the National Economic Development and Labour Council.   Democratic institutions are increasingly experienced by ordinary citizens as unresponsive, unaccountable and irrelevant.

The traditional “legitimate” institutions and leaders, such as political parties, certain civic organisations and trade unions and their leaders, are also found to be increasingly irrelevant in a fast-changing society with new needs and new problems, and which need new ideas and new tools.   If these “legitimate authorities” don’t become more responsive, accountable and democratic quickly, people will increasingly look to new ones, including populists ones, or seek answers in violence.

But South Africa’s business models are also under pressure.   The model of low wages, migrant labour and minimal skills transfers, and the provision of amenities for workers versus huge remuneration and benefits for executives is never going to be sustainable.

The best solution is to pursue policies that empower the largest number from the black majority — mass quality education is the best bet.   Instead of pursuing BEE deals with politically connected elites, business should rather give shareholding to employees or surrounding communities, or aggressively transfer employee and surrounding community skills.   If workers at the Marikana mine had been given a shareholding in the mine, and the rock drillers had been trained in new skills, the chances of the Marikana violence happening may have been reduced.

Companies will have to lift wages, while at the same time negotiating pacts with workers to strike formal agreements to raise productivity and to link future wage increases to inflation and company profitability.   The current BEE strategy, in which mining and other companies partner with senior ANC leaders and trade unionists as insurance against transformation pressure, is discredited.   Giving BEE stakes to employees, transferring skills and wealth through providing housing; and other alternatives, such as empowering surrounding communities, are much more sustainable options.

To prevent more Marikanas, we need to set up a coalition for growth between all stakeholders — the government, business, opposition political parties, trade unions, civil society and citizens — that goes beyond the ANC’s inner ruling elite.

Since such a broad national coalition for growth may not be feasible in South Africa, sector-based growth coalitions may be an option.   This will mean that the mining and farming sectors must convene indabas at which all stakeholders are represented to forge a common growth strategy for the future.

The government must genuinely govern in the interests of all South Africans.

It must govern better, be more accountable and cut corruption to secure its own credibility, without which growth coalitions are not possible.