Boiling the Frog in South Africa

Since the beginning of African National Congress (ANC) rule in 1994, South Africa has been the anticolonial movement’s great success story. While other African countries fell victim to coups and civil wars, South Africa carried on. Yes, it was a one-party state, corruption was rife, violent crime was out of control, and unemployment hovered between 25 and 33 percent—but somehow the country muddled through.

Alas, muddling through is a tactic that can only work for so long. There are about 14 million registered taxpayers in South Africa, out of a population of nearly 60 million. The bulk of income tax revenue comes from just 574,000 individuals. The ANC’s wager has always been that this tiny tax base could be squeezed for all it’s worth in order to fund lavish social benefits for the rest of the population.

Ramaphosa has articulated this gamble explicitly, according to the posthumous memoir of Mario Oriani-Ambrosini, a longtime MP for the Inkatha Freedom Party who died in 2014. During negotiations over the post-apartheid constitution in 1994, Ambrosini wrote, “Ramaphosa told me of the ANC’s 25-year strategy to deal with the whites: it would be like boiling a frog alive, which is done by raising the temperature very slowly.” Under majority rule, “the black majority would pass laws transferring wealth, land, and economic power from white to black slowly and incrementally, until the whites lost all they had gained in South Africa, but without taking too much from them at any given time to cause them to rebel or fight.”

Ramaphosa got the timing right, give or take a few years, but he forgot about the third option: Rather than fight or stay and be boiled, the white minority could always just pick up and leave. When Nelson Mandela came to power, doomsayers predicted a mass exodus similar to that of the Algerian pieds-noirs. Contrary to forecasts, millions of white South Africans stayed, either because they were committed to making the “Rainbow Nation” experiment work or simply because they were too settled to emigrate. That generation is now dying, and their children are constrained by no such inertia.

For a long time, South Africa’s natural resource wealth worked in the ANC’s favor. Gold and diamonds are where they are; you can’t outsource a mine the way you can a factory. However, in 2020, AngloGold Ashanti, a successor company of Anglo American, sold its last remaining operations in South Africa, which meant the end of an unbroken streak that had lasted since Ernest Oppenheimer founded the company a century ago. Even a mining firm’s patience has limits.