A lovely example:
Can Nelson Mandela be bribed?
(Multinational Monitor, October 1996)
South Africa's two most popular politicians -- President Nelson Mandela and the former Deputy Minister of Environment and Tourism, Bantu Holomisa -- found themselves duelling in the country's most vicious interpersonal political fight since apartheid formally ended in 1994.
At the core of the conflict is Holomisa's claim that the leadership of the ruling African National Congress has been corrupted by casino magnate Sol Kerzner. But the complicated affair also recalls chronic suspicions that the ANC can be bought by large corporations and foreign states.
>From the early 1970s, Kerzner operated several extremely
profitable casinos in South Africa, gradually moving much
of his wealth offshore and beginning to focus on new
markets in the Bahamas and United States through his
company Sun International. He is presently attempting to
gain access to the lucrative Connecticut market, through
the Mohegan Native American tribe, but the license for a
$275 million casino has been delayed by gaming authorities
who are questioning Kerzner's suitability based on his
shady South African reputation.
In Atlantic City, Kerzner also announced in August that he and entertainer Merv Griffin will revitalize Griffin's Resorts Casino Hotel, formerly owned by Donald Trump, and that a new $800 million casino would follow. Griffin had twice declared bankruptcy, and the day the deal was publicized, Sun International lost seven percent of share value. According to Bloomberg news service, Kerzner "is also interested in using Griffin as a tax shelter for profits from the Mohegan casino."
Kerzner is legendary at wheeling and dealing, and there is no dispute that a decade ago he paid R2 million (then $1 million) to the former prime minister of the pseudo- independent Transkei "homeland" in exchange for exclusive rights to open a casino on the unspoiled Wild Coast. Kerzner initially denied giving the bribe, perjuring himself in the process, but in 1989 confessed, arguing that he was coerced and that he was merely following Transkei business norms.
Frequented by white South Africans living along the Indian Ocean (especially Durban), by a few international tourists and by the tiny class of rich blacks in the homeland, the Wild Coast Sun's profits allowed Kerzner to augment his infamous "Sun City" complex -- which hosted dozens of sanctions-busting musicians -- with a new "Lost City" that is uniquely luxuriant and gauche. The latter two casinos are located in what was once the Bophuthatswana homeland, not far from Johannesburg, and their construction also involved huge favors from corrupt officials, including more than R1 billion in tax breaks for Lost City during the early 1990s.
In 1987, not long after the Wild Coast Sun was completed, Holomisa exploded onto the political scene with a coup. The young army officer led an anti-corruption faction that transferred power over the burgeoning Transkei government to Stella Sigcau, then a cabinet minister with close connections to the homeland's Xhosa tribal leaders.
But Holomisa organised a second coup just three months later, partly on grounds that Sigcau had received R50,000 of Kerzner's R2 million. She responded that the money was actually a gift from her predecessor, not a bribe from Kerzner, and an investigation into the matter by apartheid-era officials concluded there were no grounds for prosecution "on the available evidence."
Holomisa maintained a vendetta against Kerzner, however, charging him with corrupting the homeland government, and for many years sought his extradition from South Africa to stand tiral. As Holomisa persevered, South African military leaders realised that the young general would never be the consistent authoritarian ruler they had hoped for, and began to harass him. But their tactics -- an attempted coup, cross-border military raids into the Transkei against liberation movement targets, and homeland budget cutbacks -- failed to dislodge Holomisa.
As a result, the Transkei steadily drifted into formal alliance with the ANC following its 1990 unbanning, and the ANC and PAC liberation armies to operate freely in the homeland. Holomisa became an ANC member in 1994, was named deputy minister after the election, and at an ANC convention in 1995 won the most votes amongst all contenders for the ANC's National Executive Committee. Alongside ANC Deputy President Thabo Mbeki, the attractive, mildly-charismatic Holomisa was clearly Mandela's favoured son.
But this status was not to last. Extremely fluid power relations within the ANC allowed several contradictory political currents to flow during the first year of the new government. Mandela then moved more decisively to ensure that Mbeki would dominate the movement's mainstream for the 1999 election, when the president is due to retire.
Thus from mid-1995, the country's highest-profile politicians -- ANC secretary-general and chief negotiator Cyril Ramaphosa, left-wing intellectual Pallo Jordan, popular grassroots mobiliser Winnie Madikizela-Mandela (her post-divorce surname), former trade union leader Jay Naidoo, and ex-president FW de Klerk of the National Party -- all gradually lost or surrendered their positions. Mbeki was universally considered responsible for the behind-the-scenes manipulation that truncated or diverted the careers of his main competitors.
With his own career stagnating, Holomisa began to exhibit a self-destructive streak. He endorsed Madikizela- Mandela's public condemnation that "elites" were now in charge of ANC policy-making, an allegation that contributed to her dismissal from the cabinet in 1995. Notwithstanding his public popularity, Holomisa was passed over for senior cabinet posts and was rarely taken seriously by the ANC's inner-circle.
Sigcau, meanwhile, had been named Minister of Public Enterprises by Mandela in the latter's bid to retain the loyalty of powerful leaders of his own Xhosa ethnic group. But when mandated to sell many of South Africa's large parastatal firms, Sigcau was derided for her failure to consult trade unions -- in late 1995 this oversight led to threats of a general strike, and to unprecedented tensions within the alliance between the ANC, the unions and the SA Communist Party -- and then to get on with a privatization plan that Mandela and Mbeki announced was essential to win the confidence of multinational financiers and corporations.
Then in April this year, while testifying to the Truth and Reconciliation Commission about the 1987 coup, Holomisa mentioned in passing Sigcau's share of the Kerzner bribe. This mushroomed into a major news story, apparently to Holomisa's surprise, and Mbeki quickly came to Sigcau's defense by endorsing the apartheid-era commission that partially cleared her name. Holomisa was then sharply criticized by ANC leaders for having made the allegation to the Commission without "clearing" his testimony with the ANC first.
Such public rebuke only egged Holomisa on further, for he had given Mandela his submission beforehand and now realised that a purge was being prepared. He countered with a series of blockbuster allegations against Mbeki and another minister, culminating in the claim that both Mbeki and Ramaphosa were "in Sol Kerzner's top pocket." Attempts to impose discipline within the ANC's own structures, he added, were fatally compromised by its leaders' ties to Kerzner.
Holomisa's allegations were officially denied, as conflicting accounts emerged as to who paid for several "favors" -- especially free accommodation at casino resorts -- in which Kerzner appeared deeply implicated. Days later, in July, Holomisa was fired from the cabinet and was replaced by Peter Mokaba, the fiery former ANC Youth League leader who was earlier a firm ally of both Holomisa and Mbeki. Madikizela-Mandela begged Mokaba not to split the "populists" -- as Holomisa, Madikizela- Mandela and Mokaba were known -- but her ex-husband's stature was unchallengeable and Mokaba broke ranks.
The president's strategy immediately backfired, as Holomisa unleashed his most serious charge yet. He recounted that during a private chat just before the election, Mandela divulged that immediately after making a R2 million (then $600,000) campaign contribution, "Kerzner raised the issue of pending charges against him in Transkei, and asked if the ANC could assist him in asking me (Holomisa) to review the case and drop charges."
With the startling new corruption charge, Holomisa had now overreached, and the ANC's Shell House headquarters in Johannesburg immediately labeled his statements "not only blatantly false, but also malicious and defamatory." Mbeki sought an injunction to prevent Holomisa making further remarks. Reached for comment in the south of France, Kerzner confidently confirmed, "I did not pay R2 million to the ANC to help it fight the 1994 election."
But the uproar only grew when, to the surprise of everyone, Mandela had to correct his staff two days later, admitting, "I was the only one who knew [about the Kerzner donation]. Even the treasurer-general of the ANC didn't know where the money came from." Mandela revealed that Kerzner contributed R500,000 and an additional R1.5 million came from a closely-related firm.
Holomisa demanded a public apology for the ANC's harsh words, but a bitter and clearly agitated Mandela said he would prohibit anyone in his party saying sorry. Holomisa was again summoned before the ANC Disciplinary Committee on August 30, and having succeeded in forcing its chair, Minister Kader Asmal, to step down because of bias, was then expelled from the ANC, simultaneously losing his seat in parliament. Promising to fight the explusion in the ANC National Executive Committee and in the country's Constitutional Court if necessary, Holomisa warned his accusers that "They will have to sweat and swallow their pride."
At issue is Kerzner's alleged attempt at bribery, for although some aspects of the legal proceedings against him were indeed withdrawn in 1995 (because they interfered with his international activities), government prosecutors now say they had simply postponed action due to a case backlog, but that the charges still stand. The ANC claims that neither Mandela nor the organisation would have been in a position to interfere in such judicial matters even if they had wanted to, an interpretation Holomisa rejects.
Popular opinion remains divided, with most ANC members disappointed in Holomisa for his carelessness -- and apparent disloyalty -- for not airing his charges through appropriate channels. But there is an enduring sense that Holomisa's integrity, honesty and youthful naivety are still intact. Rumors of his forming a new political party made the rounds, but for Holomisa, "My home is the ANC."
The Holomisa affair also reminds observers that Mandela received tens of millions of rands in party donations from repressive East Asian regimes prior to the 1994 election, which apparently influenced the new government to both endorse "constructive engagement" with Jakarta and strengthen inherited apartheid-era trade ties with Taiwan (in the process deeply alienating the People's Republic of China). At the same time, Morroco's King Hassan also apparently bought an ANC about-turn against former allies in the Polisario Front. The Front requested formal South African government recognition of the Sahwari Republic (formerly known as the Western Sahara), which was refused by Mandela at Hassan's urging, notwithstanding Sahwari's fast-growing support in the United Nations and with many other countries.
It also recalls the role that the "Brenthurst Group" -- the country's half-dozen largest corporate tycoons, named after the estate at which they meet -- plays in giving Mandela secretive and decisive economic advice. By way of illustration, corporate pressure on the ANC at the time South Africa's interim and final Constitutions were being drafted won companies both fundamental Bill of Rights protections (equivalent to those of natural persons) and protection from being taxed at provincial level, both highly contentious concessions. A campaign to revoke corporations' constitutional protections has been launched by public interest groups, trade unions, and environmentalists, backed by Ralph Nader and his Essential Information staff.
In spite of nascent public interest watchdog activity, the smell of political corruption is strong in the air. Opposition parties are having a field day in parliamentary debates and media interest remains strong.
But attempts by progressives to translate the Kerzner scandal into campaign finance reform or even a disclosure requirement will probably be derailed in the short-term. The two largely-white political parties that traditionally gained corporate support say that they will oppose funding reform because -- in the context of monolithic ANC rule for at least the next decade or two -- companies will be intimidated not to make gifts to opposition forces if these become public knowledge.
More broadly, however, political consciousness may have been indelibly altered over the past few months. The dignity of the presidency, and the ethics of the president himself, are in question. The deputy president is profoundly tainted, along with several colleagues. Because of this, progressive factions within the ANC may make headway against the increasingly conservative power- brokers.
Such gains may not be worth the sacrifice of Bantu Holomisa -- it is too early to tell how far power relations may shift -- but one benefit is that Sol Kerzner will likely curtail any further expansion plans within South Africa. American and European observers should take heed, though, that rather than being resolved within South Africa, this particular problem will shift elsewhere.
Patrick Bond email: pbond at wn.apc.org * phone: 2711-614-8088 51 Somerset Road, Kensington 2094 South Africa work: University of the Witwatersrand Graduate School of Public and Development Management PO Box 601, Wits 2050, South Africa email: bondp at zeus.mgmt.wits.ac.za phone: 2711-488-5917 * fax: 2711-484-2729