The government’s program…and policies
As Zimbabwe enters its second decade of independence, historic changes are taking place on the world scene.
Political revolution has swept Eastern Europe, toppling Stalinist regimes in one country after another. In the USSR the revolt of the national minorities, and the stirrings of the mighty Russian working class itself, have forced the ruling bureaucracy to make major political concessions.
In all these countries the masses are rejecting one-party rule and the stifling of economic growth by an oppressive, parasitic bureaucracy.
Society could be transformed by bringing the planned economy under the democratic rule of the working class. But in the absence of political leadership to explain this task there is confusion. Workers oppose the false “socialism” of the Stalinists, and are searching for alternatives. Many look towards the advanced capitalist countries of Western Europe which appear to be offering democratic rights and a better life for workers.
These countries have had eight years of continued growth while there has been economic stagnation in the Stalinist states. In reality this growth has been based on the intensified exploitation of working people around the world — on sharp cuts in the prices paid for raw materials from the Third World and squeezing workers in the West to work harder.
Despite big profits, the capitalist world is wracked with stock exchange crises, growing inflation, high interest rates, and the threat of trade wars as the big powers fight for markets.
But so complete is the political bankruptcy of the Stalinist bureaucracies that more and more of them are turning to capitalism in the hope of finding a new basis for their privileged existence. Gorbachev himself is now planning the full-scale return of the USSR to capitalism. These leaders hope the Western capitalist class will help them buy off some of the demands of the masses and prevent them being overthrown.
They also hope to enjoy the benefits of world markets at the expense of the Third World.
But it is by no means certain that they will be able to carry through the dismantling of the planned economy without provoking massive new upheavals. To impose capitalism will mean large-scale job losses, cuts in social services and huge price rises. It is inevitable that the workers will resist this.
In addition, the next economic recession in world capitalism will prepare the ground for new struggles in the West as well as the East in which the ideas of workers’ democracy and genuine socialism will be increasingly to the fore.
Burying “socialism”
In the short term, however, these developments have strengthened the Western imperialist powers against the USSR and the Third World. With the collapse of Stalinism, Third World leaders are burying “socialism” and throwing themselves on the mercy of imperialism. In Mozambique, Angola, Ethiopia, and other countries the ruling parties no longer claim to be “Marxist-Leninist”.
In these countries, especially if the world capitalist upswing is further prolonged, there could now be the re-establishment of capitalism which would mean the return of the economy to the imperialist exploiters.
Many workers and youth, who had accepted the Eastern European regimes as “socialist”, are faced with serious questions. If these regimes have failed to provide a decent life for ordinary people, just as capitalism has failed in the Third World, then what is the way forward?
Only in Zimbabwe is President Mugabe keeping up the pretence of “socialism”. But he is putting a curse on the very idea of socialism by linking it to the threat of a one-party dictatorship.
In reality, capitalism in Zimbabwe has never been disturbed. The Zanu(PF) leaders base their policies on capitalism and the domination of Zimbabwe by South African and other multinationals.
As this handbook will show, Zanu(PF) leaders have tolerated an incredible situation where four white capitalists control the nerve centres of Zimbabwe’s production! Our research has shown that the Zimbabwean economy is dominated by a handful of capitalists who make little investment and subject Zimbabwe to South African domination.
When workers struggle for better conditions, the Zanu(PF) leaders almost always take the side of the bosses. Nelson Mawema was not joking when, accepting a gift of $18,000 to the ruling party from SA’s Anglo-American Corporation, he said that it showed the multinational’s “appreciation of Zanu(PF)’s efforts in keeping workers disciplined”! (The Herald, 3 April 1987)
Collaboration with capitalism has led the government to pass the Labour Relations Act which controls the unions and effectively bans strikes. The government does not allow the workers to challenge the multinationals and top leaders and labour officials accept bribes from them.
The Investment Code
Throughout these years, the government has rested its claim to socialist policies on reforms in health, education and on the land. It hoped that with some state intervention, capitalism would provide jobs and pay for reforms. They hoped the multinationals could be persuaded to re-invest their profits and not drain the country of foreign exchange.
But on 18 April 1989, in his Independence Day speech, President Mugabe announced major new concessions to foreign companies investing in Zimbabwe.
In the future, he indicated, they will be allowed to send more of their profits abroad. They will be allowed more freedom to operate as they wish in Zimbabwe and to export their products to Zimbabwe’s trading partners of the Southern African Development and Co-ordination Conference (SADCC).
Mugabe also promised more legal protection for investors, to guarantee that they will always be able to get back the money they invest in Zimbabwe.
These changes were spelled out in the “Investment Code” published in May 1989 for the conference held in London by the Confederation of British Industry (organisation of British capitalists) to promote investment in Zimbabwe.
On Independence Day we celebrate victory over the Smith regime which had brutally enforced the interests of the capitalist class (local and foreign). Yet here was the President celebrating this day by begging the capitalists for help.
By doing this the government was admitting that its economic policies have failed to provide the jobs, land and houses it had promised to the masses. The Investment Code, in short, is an appeal to the capitalist class internationally to solve Zimbabwe’s problems.
Despite talk of “socialism”, therefore, the policies of the Zanu(PF) leaders are no different from those of other Third World regimes which openly embrace capitalism.
Spending cuts
It is true that important reforms were carried out under pressure of the masses during the first years of Zimbabwe’s independence. Education and health care were expanded and a national minimum wage established. Some restrictions were placed on the bosses, and a limited number of landless peasant families have been resettled.
Each of these reforms was welcome; but they have fallen far short of our needs. Millions of Zimbabweans still live in poverty. The number of jobless is growing, especially among the youth. Over one million people — up to half the total workforce — are queueing up for jobs that don’t exist.
Homelessness and landlessness remain an epidemic. President Mugabe himself recently admitted: “It makes no sense of our liberation struggle that the majority of our peasant families have remained outcasts of our land tenure system.”
And yet in Epworth, Mutare and elsewhere “squatters” — homeless peasant families — continue to be threatened with eviction from the land they have lived on for years!
Zimbabwe needs 4,000 doctors but we only have 1,300 — in the rural areas half of doctors’ posts are unfilled. There was a shortage of 5,000 graduate teachers in 1989. The housing backlog is enormous: 162,500 new homes are needed every year.
The first years of independence did see increases in many key areas of social spending. From 1981/82 to 1982/83, for example, spending on land, agriculture and resettlement rose by 59 per cent; industry and technology by 29 per cent; youth, sport and culture by 60 per cent; construction and national housing by 82 per cent; labour and social welfare by 248 per cent!
Yet for years now spending on vital projects such as resettlement, housing and social services has risen only slightly — or has even been reduced!
The budget for 1989/90, for example, made further devastating cuts — spending on land, agriculture and resettlement cut by 18 per cent; public construction and housing by 10 per cent; labour and social welfare by 23 per cent; industry and technology by 38 per cent; youth, sport and culture by 26 per cent.
And the government is offering no hope of improvement in the future. Instead, finance minister Chidzero warned that the government “cannot indefinitely continue to bear the full burden of financing…services such as education”. He went on: “We are closely looking at possible ways of reducing the State burden in education expenditure.” (The Herald, 28 July 1989).
If this is done, how will education be paid for? Out of workers’ pockets, with even higher exam fees and school fees? Or will schools be forced to close and teachers sacked for lack of funds?
Burden of debt
And yet, even with spending on social needs at this low level, the government is plunging increasingly into debt.
All government spending has to come, in the form of taxation etc., from the wealth produced by the working people (and stolen by the capitalists) in agriculture, mining, industry and other sectors of the economy. Increases in government spending can be afforded out of increases in the wealth produced.
But Zimbabwe’s economic growth is only crawling ahead. Since 1980, the economy has been growing at just about the same rate as the population (3 per cent per year on average). In terms of real wealth the average Zimbabwean is still just as poor as at the time of independence.
This slow rate of growth is quite unable to finance the social programmes which the government has promised. Thus, for 1988/89, it is estimated that the government had to borrow $575 million. For 1989/90 an estimated $989 million must be borrowed.
Vast amounts must be found for interest and repayments on these debts. For 1989/90 over $900 million is needed — almost as much as the total government borrowing for the year. The government cannot afford to continue running up debt on this scale.
A colonial economy
Zimbabwe is a potentially wealthy country with much fertile land, natural resources and people who are eager to work. Over 300,000 school-educated youth become available for jobs every year. But still the economy fails to provide the government with the revenue that it needs to meet even the basic requirements of the people.
Though the government has promised “socialism”, these are not problems of socialism. All Zimbabwe’s economic problems arise from capitalism. Imperialism has shaped the economy in Zimbabwe to serve the needs of the capitalist class internationally. None of the government’s attempts at reforming capitalism have changed the colonial nature of the economy.
Industry, in today’s world, is the key to social wealth. Factories, machinery and technology are required to produce the resources we need for development. But Zimbabwe, like other former colonial countries, is caught in a vicious circle.
To develop industry it is necessary to import machinery and technology which cannot be produced locally. This must be paid for by exporting goods to earn the necessary foreign exchange. Because they lack industry most third-world countries must rely on the export of “commodities” (raw materials) to the industrialised countries. Then they have to buy the manufactured products which they need.
In the case of Zimbabwe about 70 per cent of exports consist of minerals and other raw materials — tobacco, gold, cotton etc. Of imports, 52 per cent consist of machinery and other manufactured goods and 16 per cent of chemicals (1987 figures).
Why cannot these exports pay for the imports which we need? The answer lies in the “terms of trade” which are tilted against the underdeveloped countries and in favour of the industrialised countries.
The imperialist monopolies dominate world trade. They use their power to force up the prices of manufactured goods while bidding down commodity prices.
As The Herald admitted in an editorial: “mining will remain dependent on international market conditions beyond our control.” (6 June 1989)
Thus, more and more raw materials must be sold in order to buy the same quantity of manufactured goods. In Zimbabwe, like most other third-world countries, the money received for raw materials is not enough to pay for the vast amounts of manufactured imports which are needed to lay the basis for a prosperous modern society. Economic development is held back by the lack of industry — yet, under capitalism, the lack of manufactured exports makes it virtually impossible to develop industry! This is the root cause of our problems.
The practical result is a crippling shortage of foreign exchange. To take just one example: the Number Four Plant at Bulawayo power station was out of action for nearly two years because of the difficulties in getting $1,000 in foreign exchange to order a single bolt that was needed to repair it!
It is impossible to break out of this poverty trap without transforming the economy from an exporter of raw materials to an exporter of manufactured products. But how?
An “engine of growth”
Capitalist leaders have been telling the government there is only one way to develop Zimbabwe’s economy: compete for foreign investment by opening the country still wider to capitalist exploitation.
In November 1989, for example — at the height of explosions in Eastern Europe — the president of the World Bank, Mr Barber Conable, visited Zimbabwe. First he congratulated the government and President Mugabe for their “wisdom and leadership” in managing the economy on capitalist lines. Zimbabwe, he said, is “poised for an economic take-off” and could become an engine of growth for Southern Africa.
Then he dangled the prospect of more World Bank money before the government’s eyes… provided certain conditions were met:
* “liberalisation” of the economy (removing controls on the capitalists’ activities), and
* reduction of the budget deficit (in other words, even less spending on the needs of workers and peasants).
What was the government’s response? “My discussions with President Mugabe”, Mr Conable said, “encouraged me greatly about his thinking in this respect.” (The Herald, 23 November 1989) No doubt Zanu(PF)’s leaders fear that the renewed interest of the capitalists in Eastern Europe will mean even less aid and investment for Third World countries such as Zimbabwe. This makes them still more prepared to bow down to the requirements of international capitalism. But even if they do so, is there any real hope that Zimbabwe can become an “engine of growth” in Southern Africa?
Capitalist “miracles”
It is true that a handful of colonial and ex-colonial countries have seen large-scale investment by imperialism, modernising society and leading to the development of a local capitalist class. South Korea, Taiwan, Hong Kong and Singapore are the main examples in Asia of these so-called “newly-industrialising countries”. In South America, Brazil was regarded as the “success story” of capitalism in the 1970s.
But these “successes” were possible only in a particular period, and under particular conditions. Each of the “newly-industrialising” states of Asia, in fact, was split from countries swept by revolutionary struggles. To contain the revolution and bolster puppet regimes, imperialism pumped in investment. In addition, heavy state involvement was needed to develop industry.
But the “success” of these neo-colonial countries was bought at a high price. Repressive regimes and military dictatorships have held down the working class so that the latest technology could be combined with the harshest working practices.
With the huge growth in world trade during the 1950s and 1960s these countries were able to produce cheap manufactured goods aimed at the industrialised countries.
But even at the height of the boom only limited numbers of workers could find work in the new industries. In Brazil, for example, millions have remained in grinding poverty in shanty towns sprawling outside the gates of the new factories –a vast supply of cheap labour.
At the same time Brazil has run up a devastating burden of foreign debt, swallowing up vast amounts of the foreign exchange earned from exports. These debts can never be repaid. By early 1990, inflation in Brazil was running at over 2,000 per cent per year.
These sharp contrasts of wealth and poverty, power and repression, inevitably prepare the ground for revolutionary explosions. In South Korea an insurrectionary movement of workers and students toppled the Chun dictatorship in 1987. In Brazil the advance of the Workers’ Party has given notice of revolutionary struggles to come.
In Africa the best example of a capitalist “miracle” has been South Africa under the heel of its racist minority regime — now forced on to the defensive by the huge upsurge of the black working class.
Today it is no longer possible for the South African ruling class to rely on naked racist repression as in the past. De Klerk has been forced to take new initiatives to defend capitalist power. The unbanning of the African National Congress and the release of Nelson Mandela are a triumph for the mass movement and a measure of its power.
But the leadership of the African National Congress does not base itself on a programme of mobilising the full power of the working class to smash apartheid and capitalism. Their compromise with big business can only reinforce the domination of SA capitalism over Southern Africa.
In the period since 1975 SA aggression has smashed the infrastructure and the economies of many Southern African countries, causing more than US$10 billion damage. In the eyes of the SA ruling class this barbaric destruction was well justified as it has led to a situation where SA domination seems assured.
Gorbachev, thrown on to the defensive by the crisis in Eastern Europe, no longer contests the domination of imperialism over Southern Africa. Neither do the Southern African regimes, weakened by SA destabilisation and looking to the West.
The SA monopolies, struggling to compete internationally, hope that their economic stranglehold over Southern Africa can now be extended. Professor S. Terblanche, a leading SA economist, calculates that US$100bn investment over the next 10 years is needed for this purpose –but he says “only if Nelson Mandela asks for it can we expect it”. (Independent, London, 12 June 1990)
As the Standard Bank Economic Review put it: “A new era of peace and economic prosperity must now be built with the gradual emergence of a new economic power block.” It goes on to explain what it means: “Only SA is economically strong enough to serve as the catalyst and the energising force for a new economic order in a Southern African Community.” (February 1990)
Already in 1988 direct SA investment in Africa amounted to R2.2 billion. The end of South Africa’s isolation will certainly undermine Zimbabwe’s hopes of becoming an “engine of growth” in the region. Zimbabwe cannot compete with South Africa’s far more developed economy. On the contrary, South Africa would squeeze Zimbabwe out of many of its existing export markets and tighten its grip over Zimbabwe itself.
As Anglo American boasts in its current advertising campaign, a “post-apartheid South Africa” will “become the engine of growth for all of Southern Africa”!
Yet, despite all these uncertainties, the Zanu(PF) leaders can see no alternative to capitalism. In his speech of 18 April 1989 Mugabe showed that the government is completely accepting the capitalists’ ideas. It is offering the Investment Code as only the first step in a series of concessions designed to give the multinationals bigger profits in Zimbabwe.
In return, it hopes, they will provide Zimbabwean youth with jobs.
Chidzero, the main architect of this policy within the government, claims: “There is no earthly reason why we cannot rapidly become a newly-industrialising country.” (Sunday Mail, 30 July 1989).
Fundamental mistake
The facts, figures and analysis in this handbook will show that they are fundamentally mistaken. It will show that capitalism remains what it has always been — a system of ruthless exploitation — and the alternative lies in a democratically planned economy and workers’ democracy (discussed in Chapter 7).
We believe this handbook can serve a useful purpose at the present stage. The movement of the students, the strikes in the public sector, the drop in active support for the ruling party and the very high abstention in the 1990 elections all show that broad layers of workers and youth have begun to question the government’s policies.
These are early symptoms of much greater movements in the future, spearheaded by the industrial working class.
What is the way forward? Today there is a deafening chorus of support for the capitalist “market” as the “only realistic solution” — from yesterday’s “socialists” in Eastern Europe and Western labour leaders, to many Third World leaders.
But the real question facing us is how our social problems are to be solved. People are seeking solutions — how to overcome poverty and landlessness, how to lead a secure and dignified life. They are expressing no confidence in the present leadership and they are demanding the right to determine their own future.
This, after all, is what the chimurenga was about — but many of its basic aims have still to be achieved.
The first step is to examine what capitalism (“the market”) really means. Next we will see how it operates in Zimbabwe — and readers can judge for themselves if this system offers a basis for solving our problems.
Then we will look at what measures are needed to open the road to economic and social development.
To the workers and youth in struggle we dedicate this handbook. We hope it will assist in the great task that faces us: organising, and struggling for a Zanu(PF) government of the workers and peasants that will implement the full programme of national and social liberation.