The issue of migrant workers could have serious implications for 2024 elections
Source: Fin24, 16/02/2022
For South African political parties grappling with the idea of coalition politics ahead of 2024, the issue of migrant workers may be the most crucial of all deliberations, says Khaya Sithole.
Just over 30 years ago this month during an interview on Larry King Live, Ross Perot decided to put up his hand and run for the US presidency.
Perot`s profile as a billionaire who was not part of the Washington establishment but simply wanted to change the way the establishment worked, had significant consequences for the 1992 elections and, as it turned out, for the 2016 US election campaign.
At the heart of Perot`s message, was the idea that the other contenders �` George HW Bush and Bill Clinton, were too entrenched in the establishment to actually fix it.
As it turned out, that election campaign coincided with the ongoing deliberations around the trade agreement between the US, Mexico and Canada. The most contentious points related to the impact of the proposed agreement on US jobs.
As the US labour market had evolved over time and offered various protections and guaranteed to workers, the labour force of Mexico had little in the way of such protections. The question of whether freeing up the trade border would create an incentive for US businesses to shift their operations across the Mexico, was the most polarising element of the debate.
One the one hand, the view was that globalism and globalisation rather than protectionism, are always good things that the US needed to champion. The predicted positive effects of the proposed agreement �` the North American Free Trade Agreement (NAFTA) �` included a turbocharging of trade activity across the three nations.
The unknown variable was whether the integration of trade partners with such vastly different profiles �` the US and Canada on one side and Mexico on the other side, would not lead to a one-way exodus of jobs in the direction of Mexico in pursuit of lower production costs.
The presidential contenders also took a bite at trying to crystallise the impact of NAFTA. Clinton �` who would eventually emerge as the winner of the election in November 1992 �` predicted that NAFTA would result in an export boom for Mexico and that could generate up to 200 000 additional jobs by 1995 and a million jobs within the first five years of the agreement.
Bush �` dealing with the aftermath of the Gulf War and the declining economic prospects of the US economy facing increasing unemployment, was far less decisive on the NAFTA question. Perot used the first presidential debate to predict that NAFTA would result in a giant sucking sound of jobs moving southward to Mexico.
The predictions of each of the candidates were not altogether accurate. As the trade borders opened up, one of the fundamental risks �` that Mexican wages would remain low rather than rise up to US standards - became a persistent reality.
That on its own stifled the ability of the Mexican economy to grow. The automobile sector in particular, which has always been the bedrock of the North American economies, provided the most granular insights into the effect of NAFTA.
At the end of 2016, the Centre for Automotive Research estimated that 55% of light vehicles produced in Mexico were for the US market. This implied that automotive manufacturers had indeed used NAFTA as the basis for shifting some production capacity across to Mexico.
The Economic Policy Institute predicted that over 700 000 US workers were displaced by the implementation of the NAFTA agreement �` with Mexican workers the primary beneficiaries of this displacement.
Regrettably, Mexican wages remained low and hence the predicted rise in wages for Mexican workers did not materialise.
Such variables were important many years after Perot`s presidential run, when Donald Trump promised to withdraw from NAFTA if he were to be elected.
Trump`s narrative centred on the fact that those US workers who had lost jobs in the automotive sector could simply identify NAFTA as the original source of their plight and resultant plague of unemployment.
For communities dependent on the automotive sector, such sentiments resonated strongly and materially influenced the election of Trump. The crux of Trump`s presidency was using xenophobic overtones regarding Mexicans in order to push for a revision of NAFTA.
That process consumed the bulk of his presidency and was eventually finalised at the beginning of 2020, which turned out to be the valedictory year of his presidency.
The tensions between trade, politics and labour migration have become a topical issue in South Africa in recent months.
As luck would have it, it was the involvement of a multimillionaire businessman in national politics that reignited the debate. Herman Mashaba �` who previously served as mayor of Johannesburg under a DA ticket, launched a new political party, Action SA, ahead of the local government elections.
A key message of the campaign, and something Mashaba had championed during his time at City Hall, was the need to deal with illegal immigration in South Africa. The profile of immigrants in South Africa remains a poorly understood picture for various reasons.
Firstly, the porous nature of our borders, where the question of financial resources is the decisive factor between accessing South Africa or not, makes it remarkably difficult to get an accurate assessment of the profile of immigrant citizens.
When former finance minister Tito Mboweni tweeted in April 2020 that `almost 100% of restaurant workers were foreigners`, it ignited heated debates across the Twitter sphere. Obviously, his calculation was completely wrong, but crucially, when Africa Check sough to get a more accurate picture of the prevalence of foreign workers in that sector, it concluded that while the number of foreign-born workers in the restaurant sector had been as high as 11.3% in 2011, that number had declined to just 6.5% by 2017.
Secondly, the immediate problem with the assessment of foreign workers in the restaurant industry is that it relies on the type of disclosures that are not universally practised �` especially in relation to undocumented workers and migrants.
While Africa Check cites Statistics South Africa as the primary source of the data, it is unavoidable to note that workers who are not documented are unlikely to voluntarily participate in any data-gathering exercise for fear of reprisals.
Similarly for employers who have undocumented immigrants on staff, such disclosures are likely to be seen as self-defeating. As a result, we known that the number exists somewhere in the spectrum of Mboweni`s hyperbole and Africa Check`s conclusions.
The bigger problem in South Africa is the fact that just like in the US automotive sector, some sectors do indeed experience a higher prevalence of foreign workers �` both documented and undocumented �` that participate in the economic value chain. This is where anecdotal observations and empirical facts intersect �` often with conflicting interpretations.
For a young person unable to access an economic opportunity, observing non-South Africans occupying those jobs can elicit curiosity that often mutates to resentment. This is worsened where the country`s policy around migration and foreign workers is poorly understood.
Industries characterised by lax compliance with labour laws, provide a fertile ground for both workers and employers who wish to evade the net of scrutiny, to continuously practice policies that are not aligned to the laws of the land.
Within the economic value chain, sectors like the hospitality sector, where the definition of a job may be an ad-hoc assignment that requires little in the way of formal documentation, are likely to experience such realities more acutely than highly regulated sectors.
This creates a possibility that the anecdotal experiences of citizens on the ground �` whether they feel more foreigners are competing with them for jobs or any other contention �` are unlikely to be validated by empirical data as evidenced in the case study of the restaurant sector.
The use of tested data �` which simply suggests that the issue is exaggerated - does little to quell the tensions of those living with the daily squeeze of displacement.
The unavoidable effect is the increased tensions across society. At the end of 2021, Home Affairs Minister Aaron Motsoaledi announced that the Zimbabwean exemption permits would be coming to an end.
Naturally, such an announcement generated hysteria and panic among those affected. To some, the minister seemed to be getting on the anti-immigration bandwagon that Mashaba was accused of championing.
Surprisingly, that seemed to miss the crucial tenets of Mashaba`s stance and that of the EFF under Julius Malema. In Mashaba`s utterances, the distinction between legal and illegal immigration is the pivot point.
The anecdotal evidence �` which resonates with many property owners whose buildings may have been hijacked by individuals both foreign and local; and inner-city citizens who feel that there is a significant presence of foreigners in their midst - is that there is an immigration problem.
On the other end of the spectrum, the EFF`s position on open borders is derided as an invitation to further displacement for South African workers. Both interpretations seem to be straying from the central essence of what the two parties �` admittedly led by leaders whose articulation capacity on the issue are clearly problematic �` are trying to actually say.
For Action SA, the idea of regularising immigrants is something that even Motsoaledi has championed since his days as health minister. In his previous role, Motsoaledi lamented the inability to allocate resources adequately across the health ecosystem, when one is unable to predict utilisation of such facilities.
Given the constitutional requirements around access to healthcare and the Hippocratic oath itself, a health system is likely to suffer the most acute effects of the impact of undocumented immigrants who cannot be denied access to healthcare facilities. Similarly, when buildings are hijacked, both by local and foreign hijackers, steps to correct that are indeed sensible.
The instinctive reaction to brand the Action SA approach as xenophobic serves little to advance the debate. Rather, it is seen as a tool for shutting down the conversation entirely.
The problem with tha, is that there are far too many citizens whose experiences of the system resonate with the issues Action SA seeks to raise. Its electoral performance in the 2021 local government elections indicates what some sections of the electorate are persuaded by the party`s stance on illegal immigration.
The EFF, on the other hand, suffers from the effects of the disconnect between its stance and the actual reality of labour migration patterns and the country`s policy on migration. The idea of opening up borders among trade partners is not actually an invention of Malema himself. Rather, it is a reflection of practices across the different trade blocs in the world. The European Union`s open border policy is an example of this.
The fundamental flaw in the EFF`s pronouncements is that in the absence of a clear trade policy across neighbouring states that defines the purpose and regulations, calling for open borders is premature.
The African Continental Free Trade Agreement is an example of an economic policy that seeks to gradually reduce trade barriers across the continent at large. The idea that the movement of citizens in the long run will follow the same pattern, is not altogether far-fetched.
But for as long as South Africa has an employment crisis, any idea that increases possibilities of displacement for local citizens is simply untenable politically.
A common response to the current crisis is that the deportation of one does not create a job for another. That of course shifts the debate on to the known reality that there aren`t enough jobs to begin with.
However, the displacement question �` where those out of the jobs net feel their chances would be improved if there were fewer foreigners, particularly undocumented ones, to compete with �` needs to be addressed rather than dismissed.
Since Motsoaledi`s announcement on Zimbabwe exemption permits (ZEPs), accusations of xenophobia and Afrophobia have escalated. The point that seems to have been missed is that the very origination of the permits was not a result of a committed policy to enable easier labour migration across the two countries.
Rather, it became yet another cop-out by the government of the day that found it easier to regularise the many Zimbabwean citizens who had been displaced by the political turmoil of the late 2000s; rather than condemn the Mugabe regime for having created the crisis.
The sobering reality is that no clear policy balancing the social, economic and political considerations of the ZEP regime was cogently crafted. As a result, the various administrations have perpetually renewed the permits with the hope that the tension points would organically disappear.
Unfortunately for South Africa, that model is no longer tenable and difficult conversations around how to manage to effects of the rising tensions between disaffected citizens fearing continuous displacement, and the immigrants seeking a better future for themselves, are now overdue.
The political implications of getting this conversation right are not without precedent. At the end of the 1992 US presidential elections, Perot emerged with the best third-man performance in US elections since Roosevelt 80 years earlier.
His 19% poll resulted in neither of the main candidates receiving a majority of the ballot. For South African political parties grappling with the idea of coalition politics ahead of 2024, this is just one of the key conversations they need to address.
Given its polarising nature, it may be the most crucial of all deliberations ahead of 2024, particularly if the current administration does little to address the jobs crisis.