In the realm of聽, the 鈥榳hite saviour鈥� trope has long been a subject of聽. This phenomenon, often rooted in colonialist attitudes, positions Western individuals or entities as benevolent rescuers of non-Western communities, usually without acknowledging or addressing systemic multidimensional inequalities, colonial/racial privilege, and local agency of indigenous communities. The white saviour complex has not only perpetuated聽聽but has also聽聽the efforts and voices of those it claims to help.
As artificial intelligence (AI) has emerged as a global force to potentially , we see a new manifestation of the white saviour industrial complex within emerging global AI governance.
On a cold winter鈥檚 day in 2014, I sat awkwardly in the office of the person managing a high-rise apartment building in Johannesburg鈥檚 Central Business District (CBD). The building is a former office block that has been renovated by the city鈥檚 largest private affordable housing company and is currently rented as residential accommodation. Affordable housing is commercial rental housing that caters to people who earn too much to qualify for state-subsidised housing, otherwise known as social housing, but too little to purchase their own properties on the regular market. Rents in the building in which this incident took place range from R1325 (拢65 or Ksh9695) for a studio room to R3589 (拢174 or Ksh26261) for a 2-bedroom apartment. I was in the building to interview the manager about the ins and outs of her job, and to then interview tenants living there. However, our interview was interrupted by a distraught tenant. She was visibly upset, and I soon realised that she had been locked out of her apartment. Unfortunately, this was not an exceptional situation. The housing company, like others working in Johannesburg鈥檚 inner-city, use lock-outs, or the threat thereof, to ensure that tenants pay their rent. , I had frequently heard about the threat of lock-outs, but this was my first time witnessing the effects of one actually being enforced. Several building managers had told me that they find ways to avoid having to implement them, negotiating with tenants or giving them advanced warning so that they have time to scrounge money together to make a payment and stave off punishment. In this case, however, all efforts to prevent the lock-out had failed. It was the middle of the month, and rent, usually due on the 1st, still had not been paid. The building manager therefore had no choice but to adhere to the demands of her job, even though this had obviously disturbing and upsetting consequences. However, to mitigate the harm caused to the tenant and her young child, the manager, who also lives in the building, arranged for them to sleep in her own apartment that night, whilst they tried to locate some funds to begin repaying the debt. In this case, the pressures induced by fluctuating fortunes and a ruthless cost-recovery business model, as well as the strain to personal relations and consciences this induces, became stark.
Although people living in affordable housing generally have stable salaries and employment, as the incident above shows, they too can experience downturns in luck, lose money and jobs and find themselves out on the street. Thus, whilst the plight of chronically un(der)employed people and those living in informal settlements is cause for concern and rightly receives much critical attention, it is important to bear in mind that the middle-classes too are caught between . In what follows, I trace the (pre-covid-19) experiences of people living in social and affordable housing in inner-city Johannesburg. As will become clear, their lives are shaped by economic pressure, as they work hard to pay their rent and forgo other forms of social interaction whilst striving to get by. At the same time, they also encounter other forms of pressure, as they contend with difficult and unpleasant environments and navigate spaces marked by fear of crime and concerns about safety.
Other pieces in this blog series have argued that pressure can be theorised as an imbalance between (real or imagined) economic demands and concomitant abilities to fulfil them. However, imbalances also extend beyond economic concerns and encompass desires about living situations, ease of daily life, and safety and security. In inner-city Johannesburg, pressure emanates from the fact that the prevailing urban reality does not match people鈥檚 aspirations for central accommodation that is close to jobs, schools and social services, but also provides comfort, peace of mind and liveable environments. Faced with this mismatch or imbalance between aspirations and reality, people are forced to live in-between, to reside somewhere and make do, whilst aspiring to be elsewhere, but simultaneously knowing that there are few avenues through which this aspiration can be realised. The cumulative effects of this pressure is a form of resignation and detachment, a sense of living in-between and accepting what one can get from a vastly unequal socio-economic landscape.
The COVID-19 pandemic has swept across the global economy, causing havoc and leaving many economies teetering on the brink of economic and social collapse. Moreover, the arrival of a second and now third wave of infections and a further mutation of the virus is driving the economy further into peril and uncertainty. The announcement by Cyril Ramaphosa, back in March 2019, that two of South Africa’s wealthiest families and the pinnacle of big business, the Rupert and Oppenheimer families, would be donating R1 billion each was met with admiration from all corners of the country. These commitments have since been matched by the Motsepe group of companies and Naspers, donating R1.5 billion. To date, the fund has amassed over from a wide array of private, public, and political donors.
Responses of this type are understandable when combining the already bleak outlook for the South African economy with a significant and potentially catastrophic supply shock. However, a question that may be playing on many South Africans minds is: why, given the fact that South Africa’s economy has long struggled with growth and several structural issues, is this response from big business only coming now in the face of a global pandemic? An easy answer may be that there has not yet been an event of this magnitude for big business to respond. However, a counter to this argument is that businesses should continuously be re-investing their profits regardless of the economy’s health.
South Africa has a long history of the inefficient use of profits, which favours hording cash and conducting unproductive investments such as mergers and acquisitions. These uses of profits are a direct result of the skewed incentives facing the agents of many large companies. For instance, many CEOs are incentivised through sizeable bonus packages to maximise the shareholders’ value rather than focusing on the long-term health and sustainability of the business. This short-term view causes CEOs to opt to retain earnings rather than embark on risky research, development, and innovation endeavours that often fail but may result in enormous payoffs if they succeed economically and socially. Short-termism is a result of a corruption of the idea of value creation where price is associated too closely with true value, nuturing an entrenched system of extraction that contributrs to worsening economic and social conditions. This is something the professor in the Economics of Innovation and Public Value at University College London, and director of the Institute for Innovation and Public Value, Mariana Mazzucato laments in her book .
In the first quarter of 2021, amidst the social and economic devastation wrought by the Covid-19 pandemic, the , and subsequently defended, its decision to refrain from increasing the country鈥檚 extensive social grant payments鈥攚hich now reach 18 million impoverished citizens鈥攂eyond the growth in inflation. Treasury officials have argued that a larger increase in social welfare protection is simply not currently feasible given the country鈥檚 rapidly rising public debt鈥攚hich has now breached 80% of the debt/GDP ratio鈥攁nd investor demands for fiscal consolidation. This type of fiscal restraint is unfolding in a context of heightened wealth inequality and an official unemployment rate now above 30%.
Those familiar with the financialization scholarship pertaining to developing countries鈥攖hat strand which portrays the global financial markets as a force that can alter committed policy trajectories on a whim ( 2004), as well as the more nuanced literature ( 2000; 2017; 2014; 2017)鈥攎ay recognize the Treasury鈥檚 framing of South Africa鈥檚 fiscal dilemma. However, as much of the international development literature on industrial upgrading and state policy has noted ( 2018; 2019; 2006), there is a third option available to policy-makers in developing countries beyond the binary of debt build-up vs. austerity; namely, comprehensive, employment generating state-led development.
This is precisely the case I make in my new book, published by Palgrave (2021), . In addition to documenting the onset of a financialized accumulation regime in post-apartheid South Africa since the democratic transition and the ANC鈥檚 adoption of economic liberalization, the monograph also highlights the missed opportunities that could have allowed the country to embark on a self-sustaining path of industrial up-grading, inclusive development, and internal revenue generation. Such missed opportunities include the early rejection by party leaders of the heterodox 鈥淢acro-Economic Research Group鈥� (MERG) policy cluster, the removal of the trade unions from broader macro-policy-making processes, the rejection of a modest reconstruction and wealth tax, and the abandonment of much of the 鈥淩econstruction and Development Program鈥� (RDP) platform in favor of the orthodox 鈥淕rowth, Employment, and Redistribution鈥� (GEAR) package in 1996. Had some of these missed opportunities been pursued, South African state officials would likely be in a much better position to currently adopt expansionary fiscal policies, and perhaps could have lifted their citizens out of poverty via inclusive development instead of cash-transfers.
Yet, as my monograph further documents, since the democratic transition Treasury officials have continued, despite recommendations from other government ministries such as the Department of Trade and Industry (DTI), to veto or oppose heterodox policy proposals that could potentially offer South Africa a path away from the current neoliberal quagmire. Such proposed polices include capital controls, export taxes on raw materials, the utilization of foreign exchange reserves to capitalize State-Owned-Enterprises (SOEs), and targeting specific industrial sectors for subsidies and state promotion.
A few years ago, during a year of ethnographic fieldwork with young un(der)employed men in a poor shack settlement on the outskirts of Johannesburg, I found myself sitting in Senzo鈥檚 one-room shack on a foldout camping chair. It was a hot Wednesday afternoon. Popular R&B music was blaring into the air from the nearby tavern. Senzo sat on his double bed. Soon after I arrived, Senzo handed me an ornate invitation with gold foil on the sides and his name on it. It was an invitation to the wedding of his cousin that was set to take place the following weekend. I asked Senzo if he planned to go. 鈥淚鈥檓 not going鈥�, he told me, explaining that he had declined the invitation because, as he put it, 鈥淚 don鈥檛 want to put more pressure on myself鈥� describing the difficulties he already had paying rent, keeping up with outstanding debts, and supporting his girlfriend and children. Going to the wedding would require him to buy a fancy suit and a gift for the couple. This required money he didn鈥檛 have. The 鈥減ressure鈥� Senzo described was not just the monetary cost of attending the wedding. It was also the feeling (what Senzo called 鈥渟tress鈥�) of being overburdened by competing demands on his money including buying consumer items, sending his children to good schools, and supporting family members. To understand the continuous “pressure” young men like Senzo face requires we give attention to the changing nature of work and the changing world of families in contemporary South Africa. As I show below the pressures young black un(der)employed men experience are at once economic and social given the pressure they face to not only 鈥減rovide鈥� for themselves and their families exists alongside a pressure to improve or 鈥渦pgrade鈥� their lives. As such, I show how the 鈥渋ncome-demands gap鈥� (a key catalyst of 鈥減ressure鈥�) in young men鈥檚 lives is produced in and through specific (increasingly temporary rather than enduring) social relations and ties.
In recent years, state capitalism has become an important buzzword in the development economics discussion (again). In view of the very different ways in which this term is used, Ilias Alami and Adam Dixon recently highlighted the dangers of using the term too loosely in an article in . In view of its recent popularity, state capitalism could suffer a similar fate to the terms “neoliberalism” or “financialisation” by becoming a very loose rallying cry without any significant analytical value. To overcome this problematic situation, Alami and Dixon propose that future research should (1) develop a theory of the capitalist state, (2) circumscribe the time horizons of state capitalism, and (3) locate state capitalism more precisely in territorial and geographical terms.
Although I am not sure whether the genius can be put back into the bottle by developing a unified theory of the state (too many different theoretical traditions are involved by now), I am very sympathetic to the latter two demands. Our recently published book “State-permeated Capitalism in Large Emerging Economies” () is a modest contribution to the latter goals. It deals with the economic development of Brazil, India, China and South Africa between 2000 and 2015. Departing from a 鈥�鈥� perspective, we have developed an ideal type of state-permeated capitalism – as opposed to liberal, coordinated and dependent capitalism – and examined to what extent large emerging markets are approaching this ideal type. Read More »
In April 2012, at the White House on her first visit to the United States since her election in 2010, Brazilian president Brazil Dilma Rousseff scolded advanced capitalist economies for unleashing a 鈥�tsunami de liquidez鈥�,a 鈥榣iquidity tsunami鈥�, onto the developing world. The expression liquidity tsunami suggests that the sheer scale and volume of financial capital flows to developing and emerging markets had become an issue. It indicates that these quantities were overwhelming and could trigger devastating damages.聽
This in itself is puzzling. Have we not been told by development economists and practitioners that financial capital flowing into the poorer areas of the world economy is something good and desirable? That one of the main causes of underdevelopment is actually the lack of capital and domestic savings in developing countries, and that this should be compensated with foreign capital inflows? Following this line of reasoning, vast swathes of financial capital flowing into emerging markets surely should be seen as a boon.
And there was some truth to that. The capital flow bonanza from the mid-2000s to late 2013 (coupled with the primary commodity super-cycle) did deliver some benefits to emerging markets. It helped governments fund themselves at better conditions. It provided the material basis for significant redistribution via a number of social policies. It contributed to economic growth performances much higher than over the previous decade. It also made a minority of people much richer in a very short period of time. In sum, the capital flow boom temporarily helped deliver some economic and social gains, and this was instrumental in consolidating social contracts between governments and their populations.Read More »
The recent global financial crisis sparked renewed debates, both within academia and policy-making circles, about regulating highly mobile cross-border money-capital flows. A particular type of policy tool has received considerable attention: capital controls (CC). Within mainstream economics and policy-oriented circles (including policy-makers in central banks, finance ministries, and international organisations such as the IMF and the G20) there has been a growing recognition that unregulated cross-border money-capital flows can considerably disrupt capital accumulation, and debates have accordingly focused on the potential role and effectiveness of temporary CC in limiting the destabilising potential of those flows, while maintaining a long-term commitment to an open capital-account and free capital mobility.[1] By contrast, the Left (including organised labour, progressive economists, and civil society organisations) has been largely critical of capital-account liberalisation, and has denounced its detrimental effects in terms of constraining policy options for development and long-term industrial development.[2]Read More »
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