Learning to Live with Majority Rule

THE BALTIMORE SUN

So far, South Africa has been lucky.

In the run-up to the transfer of power, there has been plenty of sporadic bloodletting. But none of the doomsday scenarios hatched in fearful minds over the years has come to pass. There has been no all-engulfing civil war; no jetliners have been shot down over Johannesburg.

And all the fanciful -- and potentially disastrous -- academic and political schemes that over the past decades recommended carving the country into artificial, ethnic homelands have mercifully come to nothing. The new South Africa will be a unitary state.

Can this seemingly auspicious situation last as South African whites -- a mere 14 percent of the country's population -- dismantle a ruling machinery they developed over more than three centuries, including the structures of 46 apartheid years?

The answer is a resounding "yes" -- even though the difficulties ahead are awesome. Under the pragmatic leadership of Nelson Mandela and President Frederik Willem de Klerk, many potential disasters have been averted. Psychologically, a new, democratic South Africa has a chance at its birth.

As the Afrikaners -- "the white tribe of Africa" -- do soul-searching about their changed future, certain parallels are inevitable.

Every Afrikaner child learns early in life that, the Afrikaners, too, were ruthlessly oppressed after being defeated by the British in the Boer War of 1899-1902.

Their political organizations were outlawed, their religion ridiculed by the British, who characterized Afrikaners as "shiftless." Yellowing photographs purport to show how school children were forced to wear derogatory signs after they were discovered speaking Afrikaans.

Other photographs, taken during a 1920s study financed by the Carnegie Foundation, show destitute Afrikaner farmers living in squalid mud hovels, just as blacks still do in many parts of South Africa.

Yet by the 1980s, the Afrikaners had gone through an amazing transformation. They had elevated themselves from a largely impoverished and backward rural underclass to a wealthy and well-educated urban population.

Much of this transformation was made possible by policies which gradually deprived all non-whites of basic political and economic rights.

But that was not the sole reason.

Mobilized by its two ideological beacons, the Dutch Reformed Church and the secretive Broederbond fraternal society, Afrikanerdom pooled its initially meager resources together. Progressing according to a detailed and deliberate educational program, this clannish but cohesive tribe developed a mighty economic muscle through such banking giants as Volskas and Sanlam. In short order, the political masters of apartheid also became its economic masters.

As political power now changes to the black majority, most Afrikaners have no other country to escape to, even if they desired to do so. Because their ideologues believed in white power longer than most of the white business community, the stakes of Afrikaner financial powerhouses are still largely in South Africa.

Cultural and linguistic self-preservation is the paramount concern of Afrikaners. For that reason alone, their institutions -- which are closely linked to the ruling National Party -- have to negotiate the best deal they can with Mr. Mandela's African National Congress. The transfer of political power may be the easiest part in a country where inequalities -- compounded by vast educational differences -- are so stark that the white minority owns nearly 90 percent of the land and controls about the same percentage of formal economy.

The triumphant ANC now has to decide how it can keep its promise and make a more equal share of wealth available to the blacks -- but without scaring off white investors.

The infrastructure challenges alone are incredible. South Africa's million whites enjoy all the conveniences that come with one of the world's highest standards of living -- from swimming pools to luxury cars. In contrast, many of the 35 million blacks, "coloreds" or Indians lack basic services such as tap water and electricity.

Because of the highly commercialized atmosphere of urban South Africa -- and because so many work in the white economy and can observe themselves -- the disadvantaged are keenly aware of how the privileged live. And now that the majority of South Africans are under 21 years of age, they may not have the patience for change of their elders.

Most of the current government's long-term development plans were made only with the white minority's needs in mind. South Africa's power grid, for example, will be woefully undersized to handle the explosive demands of black consumers, many of whom expect to have electricity among the first fruits of majority rule.

Nelson Mandela has been deliberately vague about his economic agenda. This is not surprising; he does not want to upset the apple cart. As the imminence of ANC rule became evident, some 16 billion rands (about $4 billion) were transferred out of the country last year alone.

The ANC will inherit a country where a handful of people -- all white -- control much of the private-sector economy.

Economic power is so concentrated that some 10 conglomerates control nearly 90 percent of the equity on the Johannesburg stock exchange. They include the Oppenheimer family's Anglo-American/ DeBeers/Minorco empire, Anton Rupert's tobacco and liquor giant Rembrandt/Richemont, the Gordons' Liberty Life, the Menells' and Hersovs' Anglovaal mining concern and insurance and banking behemoths Old Mutual and Sanlam.

Over the past decade, many of these players -- spearheaded by Anglo-American and Rembrandt -- have systematically dispersed their operations and capital throughout the world.

They have been extremely secretive, both about their financial arrangements and structures because of the sanctions against South Africa -- and, in the case of DeBeers, the company's virtual monopoly of the world diamond market.

Through extensive cross-ownership, these companies remain dominant players in South Africa's economy. But as they internationalized their organization and assets, their tentacles acquired octopus-like characteristics.

"Where is the heart of DeBeers? It is not easy for me to say," acknowledges a well-placed South African business representative in Washington. "Is it on Market Street in Johannesburg? Perhaps. But it could be as well in Switzerland."

These companies globalized their operations at a time when many foreign multinationals pulled out of South Africa because of sanctions. In many cases, the South African holdings of those multinationals were bought by ruling Afrikaners.

Allister Sparks, in his intriguing April 11 article in the New Yorker magazine, revealed that the Pretoria government began negotiations with Mr. Mandela, then a political prisoner, as far back as 1985. Indirect or direct economic contacts with the ANC have been going on even longer.

In a way, the Afrikaner institutions are fortunate. Unlike a number of rival black power organizations, the ANC throughout its history has advocated a non-racial future for South Africa. For that reason, the new government is not bent on early confiscation of white wealth but is likely to seek accommodation with the Afrikaner financial sector. This evolving relationship may not be painless, but both sides will need each other.

Unspecificed measures toward redistribution of wealth are high on Mr. Mandela's agenda. But the ANC does not have to rush into a hasty confrontation with the white private sector. Although the ANC makes no secret about its desire to assume some control over the private mining industry, it can move slowly enough to avoid upsetting investors at home and abroad, because the government already controls vast sectors of the country's other strategic assets.

Starting with Iscor, the state steel and engineering giant created 1927, a succession of governments established a comprehensive network of quasi-governmental industries.

By the 1970s and 1980s, when the Nationalist Party felt it was fighting the "total onslaught of worldwide communism," those corporations also included Escom (the electric utility monopoly), Sasol (synthetic gasoline, refineries and distribution) and Armscor (weapons and vehicles).

Along with the state's transportation, harbor and shipping units, quasi-government entities employ about 400,000 people, mostly white. Historically, they were an important mechanism for lifting Afrikaners from poverty.

These "parastatals" are likely to be used to a similar end in the ANC's economic redistribution efforts. This became clear some three years ago, when white politicians began talking about privatizing those companies. The ANC, fearing the National Party government might rob it of the "crown jewels," so violently opposed the idea the whole privatization drive was abandoned.

Antero Pietila is an editorial writer for The Baltimore Sun and a former correspondent for The Sun in South Africa.

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