The mining monopolies are wrecking the economy


The President has issued a warning that ‘tensions’ in the mining industry ‘could impoverish the country’.  At the same time the Minister of Finance warns against strikes on the mines, claiming that it would lead to job losses. Contrary to what the ANC government claims, it is the mining monopolies who are wrecking the economy.

Recently the ‘Africa Progress Panel’, chaired by ex-President Mbeki, reported that twice as much leaves Africa through illegal deals like mispricing and tax avoidance than it receives through ‘Aid’. Thus ‘Aid’ is an artificial construct by imperialist banks to keep Africa in debt and totally dependent.

Consider the nature of ‘Aid’. Take the example of ‘Aid’ from the US for Aids drugs. These are sold to Africa through loans. Thus the funds do not even leave the USA but once delivery is taken of the drugs, the loan has to be repaid. Generally the rate of interest we pay in Africa is substantially higher than in the USA or Europe. ‘Aid’ secures a market for the US drug company, which means a competitor cannot easily enter, while at the same time Africa lands up paying double what we should have been able to pay for ourselves in cash, or even have developed ourselves.

Let us now consider the scale of the theft by US mining companies and banks such as Anglo American and JP Morgan Chase. (JP Morgan Chase is one of the main shareholders of Anglo American). Ashman, Fine and Newman’s work in 2011 (Amnesty International? The Nature, Scale and Impact of Capital Flight from South Africa) in the Journal of Southern African Studies, outlines how the mining companies have been responsible for illegal capital flight from South Africa for more than the past 40 years. Ironically, in 2007, during the Presidency of Mbeki, this theft reached its zenith. More than twenty per cent (20%) of South Africa’s GDP was stolen by the mining companies, a figure in excess of R600bn.

This is one of the ways that the mining companies would smuggle out value from SA: They would, for example, label Platinum ($1400 per ounce) as Palladium ($400 per ounce) and thus smuggle out $1000 per ounce.

Here is one of the reasons why our youth have no future, why millions are suffering and deliberately kept in starvation and in shacks and overcrowded ghettoes. Mineworkers themselves either live in apartheid hostels or in squatter camps around the mines. How many hundreds of thousands have died from preventable diseases of poverty? Yet the DA and ANC fall over their feet to welcome the chief representative of the 1% responsible for the continued enslavement of Africa. The DA and ANC warn mineworkers not to strike while trillions are being carried off by the mining monopolies. Such a challenge, they claim, will lead to job losses when the reality is that the large-scale theft is what keeps millions in forced unemployment and low wages. A challenge to the theft could even lead to a credit downgrade, a sign that capitalism is itself the root cause of poverty.

JP Morgan Chase is also one of the main shareholders of the SA Reserve Bank. According to Mcgregor’s Who Owns Whom, the major player on most of the gold mines is the Bank of New York.

The ones who were supposed to police illegal capital flight, such as the ex-Governor of the Reserve Bank, Tito Mboweni, is now Chair of AngloGold Ashanti;  the ex- Deputy Chief Director of the Department of Minerals and Energy, Harold Motaung,  is now CEO of Atlatsa which is in partnership with Anglo American in the running and control of Bokoni Platinum. When Mr Gordhan was head of SARS, they turned a blind eye to Anglo American and all the mines who have been involved in illegal capital flight (stealing); the eyes of SARS are still closed. They have repeatedly offered amnesty, but the mines have refused to declare their misdemeanours. Yet SARS does not act against those mining companies who are snuffing out the future of our children. SARS acts against the ordinary person who owes a R10- we are treated as criminals but the big time crooks get away with murder.

Surely the conduct of the mining monopolies is a strong argument why they should be expropriated, without compensation and placed under workers’ control. This would be a decisive way to stop them from wrecking the economy and the masses as they have done for decades.