In the economic history of nations, there has been one sphere of economic action that has jump-started the engine of economic growth and development, which then spreads the growth dynamic to the rest of the economy.
US cotton plantations and the textile industry were the economic basis of British industrialisation; the construction of railroads jump-started the engine of US economic growth in the mid-19th century; while mining jump-started the engine of industrialisation and economic growth in the late 19th and early 20th century in South Africa.
Economists serving the World Bank and leading banking institutions begin their explanation of our economic crisis by blaming the downturn in the world economy.
This is incorrect. The causes of our crisis lie totally within our society: it is the colony within the economy.
The measures that must kick-start the economic process leading to the elimination of the colony must occur inside the colony itself. The initial measures must be in the home base of the colony – the African rural areas – and from there move to the offspring of the rural areas, the townships and squatter camps. This shall lead to the growth and rejuvenation of the national economy.
The first act needed is to initiate an agricultural revolution in the African rural areas. The agricultural revolution occurred only in white rural areas, and excluded the vast majority of society.
The first aim of this policy should be to solve the food crisis in the countryside. Because of high unemployment and poverty, diet in the colony has collapsed. This is the foundation for the collapse of the health of the majority of people, resulting in abnormally high death rates in the colony. This is the basis for the collapse of our public health-care system.
The error in the agricultural development policies of most provincial governments, and of the national government, is that the aim is to produce successful individual commercial farmers as part of a strategy to create a black capitalist class. The focus is not to develop the capacity of an entire rural community to produce sufficient food to meet household needs, first and foremost, and then, following that, to develop marketing channels and an agro-industry.
It is a major error to assume that the agricultural revolution that occurred in the white rural community renders the agricultural revolution in the African community unnecessary.
This error follows from the wrong assumption that the white-dominated industrial, commercial and agricultural economy is the major actor, the Big Brother of its twin, the colonial economy; that the white economy shapes the national economy. In our time, it is the colony, the African population which, in the deficit sense, shapes the national economy.
Influential industry-centred economists think that the African rural areas are of minor significance in the national economy, because 60 percent of the population is now urban.
They are wrong. It is one thing for the majority of rural people to disappear because they have been absorbed by national industrialisation, as happened in England; it is something else for the majority of rural people in the colony to disappear because underdevelopment and misery in the colony’s countryside have forced them to move to the cities and towns, and to become the vast hub of the unemployment problem in the nation.
Because of the current economic crisis, rooted in the existence of the colony, there is no prospect for these millions of Africans to find jobs in the existing modern industry and commerce.
The existing framework of the South African economy has reached a dead end in terms of growth potential; it can neither absorb the vast majority of the migrants from rural areas, nor the youth produced by population growth within the urban areas.
The first link of the chain of economic activities we must focus on and grasp with our full strength is initiating the agricultural revolution in African rural areas. This is a revolutionary change that shall reverberate throughout the length and breadth of our society. The chain reaction from that shall lead to reverse migration, to masses of people in towns and cities moving back to revitalised and modernised rural areas where substantial job creation shall be occurring.
The making of modern society begins with massive changes in the countryside. The first act in the rise of capitalism was the massive transformation of the English countryside. Our slogan towards the creation of a new South Africa should be: To the Countryside!
The rise of the Chinese economy is another striking confirmation of the fact that the countryside is the springboard for the creation of modern society. We really have to begin with the maligned Cultural Revolution, led by Mao Zedong, from 1966, which saw hundreds of thousands of urban Chinese compelled to go to the countryside “to learn from peasants”, to bring about a synthesis between urban knowledge and science, on one hand, and peasant knowledge and science, on the other.
Modern analysts, however, date the birth of modern China to 1978, when the Deng Reforms began. What is striking is that this new stage in the building of modern China began in the countryside.
In an official publication of Chinese scholars, we read: “Reform was first implemented in the rural areas, and then gradually carried out in cities” (Gao Shangquan, Liu Guoguang and Ma Junru, The Market Economy and China, 1993, p5).
The important point for us is that this has been a single chain with interconnected links, and that the first link that was grasped with the full strength and determination of the Chinese government was transformation in the countryside.
In the early 1990s, economists calculated that almost half of the acceleration in China’s economic growth rate during the first phase of reform (1978-1983) came from improved agriculture and rural development (China: The Next Decade, edited by Denis Dwyer, 1994, p13).
A crucially significant lesson for us is that Chinese peasants, given assistance, and freed from the dictatorship of the government and urban activists, not only produced sufficient food for over 1 billion people, but also, on their own initiatives, developed non-agricultural economic activities called township enterprises.
These small peasant-controlled companies produce light industrial products needed by local people, and have become the roots of the emergence of rural industrialisation and small-scale urbanisation in the countryside.
Even more important for us is that these companies have played the most crucial role in absorbing millions of unemployed in rural China.
“The industrial output value of township enterprises accounted for 9.1 percent of the gross national industrial output value in 1978, 16.3 percent in 1984, 23.8 percent in 1989, 30.8 percent in 1991 and 36.8 percent in 1992.
“A total of 10 million surplus rural labourers were absorbed by these enterprises per year, and by 1988 employed 95.45 million people, almost equal to the figure for workers in state-owned enterprises.” (Gao Shangquan and Chi Fulin, The Reform and Development of China’s Rural Economy, 1997, pp 169, 173).
It was the productive activities of rural Chinese people, using a mixture of traditional Chinese science and technology and modern Western science and technology that played a very significant role in launching China to being the leading economic power in today’s world.
We must do in the African and coloured rural areas of South Africa what the Chinese leaders decided to do with regard to the Chinese countryside. Indeed, in the late 19th century and early 20th century, African rural producers were becoming the leading participants in the new national market, actually surpassing white rural producers.
The leaders of the white community, imbued with the gospel of the “White Man’s Burden”, were disturbed; hence the white legislation that forbade Africans from entering the new market as equals.
My concluding thoughts shall be in the next article. Stay tuned.
Professor Herbert Vilakazi is an independent scholar and contributed this article in his personal capacity. (www.professorvilakazi.wordpress.com)