1
Sanford School of Public Policy
Urban Poverty Workshop, December 4-5, 2014
The New South African Debt Economy
Anne-Maria Makhulu, Cultural Anthropology (Duke University)
(DRAFT - do NOT cite or circulate without author permission, © 2014)
Abstract
This paper argues that urban poverty in South Africa has to be understood historically, that is, in
the context of long enduring policies of land dispossession, peasant proletarianization, and urban
removal that stripped black South Africans of rural land, forcing blacks into the orbit of
industrial work, while simultaneously denying a newly-minted migrant laboring class rights of
urban citizenship. Post-apartheid efforts at “reconstruction and development”—addressing
problems of land hunger and homelessness—have eschewed these deeper historical problems
turning instead to market mechanisms for redress. These have taken a variety of forms: housing
provision without substantial land redistribution; self-adjustment and the repayment of odious
apartheid era debt; the raising of interest rates to effect market integration, causing, in turn, the
collapse of certain key areas of the lower middle class mortgage market; the adoption of cost
recovery as a driver of municipal governance; and finally, jobless growth. These policies
together have driven largely poor black South Africans onto the peripheries of the country’s
cities, into informal settlements, and beyond the formal employment sector into survivalist
activities within the informal economy. The existence of informal settlements under apartheid is
undeniable, but the post-transition turn to liberalization of South Africa’s markets has come in
tandem with the expansion of peri-urbanism and informal economic activities. Since 1994,
inequality has deepened, unemployment has increased, and poor South Africans have found
themselves gradually taking on larger debt burdens. If, following Maurizio Lazzarato, the
central organizing logics of twenty-first century life consist in a relationship between debtor and
creditor—as a new form of absolute power—of financial power, South Africa sits at the
epicenter of a new debt economy that has particularly deleterious consequences for the urban
poor.
Introduction: Cape Town’s Limits
The poor [are those] whose means are barely sufficient for decent independent life…
according to the usual standard of life in this country.
—Charles Booth, 1889
Between the late 90s and early to mid-00s I would become fairly well acquainted with a number
of families on Cape Town’s southeastern perimeter, specifically, in the area of Philippi East—a
sprawling series of contiguous squatter camps that local government now referred to as “human
settlements,” presumably modeling their reformist language after the UN Millennial
Development Goals. The southeastern perimeter of the city and Lansdowne Road in particular,
the arterial that runs its length, persists in reflecting most deeply the legacy of apartheid
segregation and urban management. It is home to the city’s African population, mostly Xhosa
2
speakers, black migrants from across sub-Saharan Africa, and coloureds (Afrikaans speaking
people of European, African, Asian, and indigenous descent). Though apartheid legislation no
longer prevails, this dumping ground to which hundreds of thousands were dispatched remains
utterly peripheralized even as the city draws much of its blue collar workforce from its ranks and
Africans and coloureds by their sheer numbers dominate. Marginality is a “myth” (Perlman
2010; cf. Roy 2003) inasmuch as areas such as these have long sustained the city and remain
central to its social, economic, and cultural life. Which is in no way inconsistent with the notion
that spatial-political marginalization has also been the very condition of concentrated poverty
and the necessary turn to informal and unregulated activity.
Among the many people I got to know, the Mfeketos figured prominently in the day to
day of fieldwork. By 2006, Edith, her husband, Solomon, their four children, and a
granddaughter lived in a small Reconstruction and Development Programme (RDP) house set
back from the main road leading out of Lower Crossroads and onto Sheffield Road. Previously a
small informal settlement Lower Crossroads now boasted a population of approximately 8,000.1
The house was organized around a central living space, two bedrooms, and a kitchen, and while
the front of the house was built from brick, the rooms in the rear were pieced together from the
remains of a much older structure, mostly assembled from corrugated iron, cardboard, and plastic
sheeting. This part of the house dated back to the 1970s when the family lived in Old Crossroads
(now its own township and ward district located approximately a mile away). The practice of
recycling building materials is not uncommon and across the city, in both formal townships and
informal settlements, the sedimentations of the city’s history of violence and displacement are
particularly visible in the ways that shacks (ityotyombe) and brick homes (endlini) are very often
conjoined.
This combination of new and old, bricks and mortar, cardboard and tarpaulin are the most
immediate expression of a legacy of past housing restrictions and current policies that are
nominally “colorblind” yet nevertheless confine black and brown people to the city’s limits.
Responding in significant measure to the limitations of post-1994 planned housing delivery,
these “hybrid” homes offer a stopgap. In some provinces budgets have been either over- or
under-spent; public funds have gone to private contractors operating with minimal oversight; and
in general, despite government targets—famously, the claim to one million low-cost homes in
the first five years of democracy—enormous backlogs remain while the quality of completed
homes, their size and structural integrity in particular, is highly questionable.2
John Matshikiza, a journalist at the Daily Mail and Guardian, describes the peculiar
relationship of the townships to the vision of a post-millennial South Africa:
The townships are not shrinking or being dissolved into the greater reality of South
African urban culture of the Third Millennium. On the contrary, they are growing. A
million new township houses have been added to the existing stock by our new Rainbow
Government since 1994. Each unit seems to be even tinier than the housing units we
grew up in—attracting to themselves the colloquial name of ‘vez’inyau, meaning “show
1 Personal communication Gugulethu Sokothi (derived from BKS data source). Also See Ward 35 demographic
profile derived from 2001 Census data
(http://www.capetown.gov.za/en/stats/2001census/Documents/2006%20Ward035.htm, accessed October 24, 2013). 2 As previously noted in the Introduction, the Western Cape Province faces some of the greatest challenges in
housing delivery with a backlog estimated at close to 500,000 making this the province with the greatest increase in
housing demand.
3
your feet”—[because] the dwelling is so small that when you sit with your back to the
wall at one end of the house, your feet will be sticking out at the other.3
If the state counts or reckons its progress in numbers of units built, a South African public
focuses on size. Vez’inyau is one expression of the miniaturization of post-apartheid
reconstruction and development (cf. Scott 1998), while Unos (Fiat cars), Smarties (similar to
M&Ms) and even “kennels” are also invoked in describing the RDP starter homes. Two decades
of neoliberalization have reinforced the monetarist logic that drove development even before
1994 and partly explains problems of quality and size. Funded with shallow subsidies
(approximately R16,000 per unit for the first decade following democratization),4 there were
never the incentives to build well and large. It is little wonder that the townships to which
Matshikiza refers have not only proliferated—that they should not only be the source of
deepening class and race based exclusions—but that they should so powerfully recall the past
too. Rebecca Ginsburg reminds us that in the 1950s the state built “quickly and
ruthlessly…Construction crews placed floors directly over boulders, stones, and anything else in
their paths. Some houses were left with field grass growing inside and cement often remained
hanging between unevenly laid bricks” (Ginsburg 1996:129).
Given the scale of dispossession and displacement under apartheid post-apartheid efforts
at delivering housing seem negligible. In the period post-1948, approximately 3.5 million South
Africans were forcibly removed,5 while mandatory construction friezes in African areas created
artificial housing shortages and discouraged urban settlement. These policies complemented a
longer-standing process of land seizure (following the 1913 Natives Land Act) that stripped
Africans of rights in private property and secure land tenure across urban and rural areas.6 All
this is well acknowledged as a starting place in understanding the post-apartheid city. That being
said, I am most centrally concerned in this paper with the deleterious consequences of the new
focus on markets and the resultant failures of vision in transforming the apartheid city. This
“less ambitious goal of public and private intervention” is consistent with the movement away
from top-down reformist strategies of the post-war period and the “championing [of]
privatization of housing supply… and micro-entrepreneurial solutions to urban poverty” (Davis
2006:71; also see de Soto 2000). As we know, free market strategies tend to encourage “private
and personal responsibility and initiative” (Harvey 2001:108) and thereby deny collective
obligation, which in a place like South Africa would be the only way to confront a much longer
history of colonial dispossession.
In the absence of collective action and obligation to reckon with the South African past,
individuals, women in the case of this paper, seem most often to bear the greatest responsibility:
for community, for kin, and for household. They expertly reckon both material and social costs
of life and depend on networks of mutual reliance. This follows in a long tradition of domestic
management, thrift, and financial resourcefulness in African communities (Bähre 2007b). Even
in the early days, in the 1970s, with the illicit establishment of places like Crossroads squatter
camp, despite the absence of formal infrastructure, there were undertakers, makeshift churches,
3 See “Johannesburg: Shanty City, Instant City,” John Matshikiza, Open Democracy, December 13, 2002,
http://www.opendemocracy.net/people-africa_democracy/article_835.jsp, accessed December 13, 2013. 4 For the period of the late 1990s when the Rand was already dropping in value, R16,000 was approximately $2,500. 5 See Department of Rural Development and Land Reform (http://www.ruraldevelopment.gov.za/1913-land-act-
centenary#.Uswwu_bTQ_4, accessed December 22, 2013). 6 Since 1994 black ownership of land has increased from 13 percent to 16 percent. See “‘Good Response’ to Land-
Reform Initiative,” Abhik Kumar Chanda, Mail & Guardian, August 16, 2006.
4
schools, and crèches—all signs of a nascent entrepreneurialism and self-sufficiency. More
ubiquitously, the local spaza shop—the corner store run from a private home—has long sold
bread and milk and sweets, homemade foods, and other conveniences.
Edith ran just such a sweet and snack shop from her front yard and could often be found
preparing small fried foods and seasoned chicken feet, which her husband then sold from an
outdoor stand along with loose cigarettes, small packets of crisps, and an assortment of sweets.
This “survivalist” business provided the family with its main source of income bringing in the
equivalent of a few dollars a day.7 Spaza shops occupy a precarious niche within the larger
township economy: at once responsive to extreme competition from local shopping malls (the
Shoprite near Lower Crossroads is less than half a mile away), as well as to smaller concerns,
mostly owned by foreign nationals including Somalis, Ethiopians, and some Zimbabweans.
“Foreigners” are perceived to be hard working—ready to throw in given the relative stability and
prosperity afforded them in South Africa—and people argue that they tend to undercut the local
competition, remaining open later into the evenings and catering to the whims of customers.
Predictably perhaps, South Africans misidentify immigrant small business owners as the source
of larger problems of structural unemployment and occasionally such sentiments fuel violent
attacks against suspected illegals or makwerekwere, as was the case in 2008.8 The fact that
South Africans resort to violence in reasoning their redundancy arguably depends on a broader
problem of state legitimated violence as well (see for example Neocosmos 2011). The kind of
state legitimated violence that brought on South Africa’s mass structural unemployment in the
very first place.
Capital on the Limits
For many residents of Lower Crossroads, so-called “informal” businesses make up in no small
part for the lack of wage-paying jobs, raising fundamental questions about the salience of the
“informal” as an analytic in explaining hybrid zones of productive activity within the national
economy (the largest in Africa) yet whose associated workforce is regarded as largely
superfluous to the formal labor market. This relationship between formal and informal sectors
echoes a broader regional and Continent-wide phenomenon: of forces of globalization that have
resulted not so much in the seamless integration of national economies into the global system,
but rather to “capital flows and markets [at] once lightening fast, [patchy] and incomplete”
(Ferguson 2006:49). Such configurations remind us that rather than failing to meet the endpoint
of the developmentalist telos that such unevenness is inherent to a new and sophisticated world
system (Ferguson 2005:380).
Arendt writing of the concept of superfluity in The Origins of Totalitarianism—of
workers drawn from all over the world by South Africa’s gold rush and industrial revolution—
observed these would otherwise have had little “use or function” (Arendt 1994:189) in the labor
market had it not been for the color of their skins and the preferential treatment afforded white
workers. For Arendt there existed a logical continuity between forms of surplus labor and
surplus populations—populations conceived as subjects for elimination. In this sense, Arendt
7 For an interesting discussion of the dollar a day calculation of poverty see Reddy 2004 “A Capability-Based
Approach to Estimating Global Poverty” in “Dollar a Day: How Much Does it Say?” a special issue of In Focus, a
publication of the International Poverty Centre, United Nations Development Programme. 8 A pejorative for foreigner, makwerekwere ostensibly mimics the sound of those who speak other languages. See
for example http://mg.co.za/article/2008-09-07-cape-town-relocates-xenophobia-refugees, accessed January 5, 2014.
5
anticipated Foucault’s biopolitical state, even while the concept was never more than implicit in
her own work.
Echoing Arendt’s observations about the late nineteenth century, by early millennium
households all across South Africa, including on Cape Town’s periphery, were caught in the
crosshairs of market reform leaving many without formal employment and nostalgic for a past of
financial certainties, minimal as these must have been. Solomon Mfeketo’s story was hardly
unusual. He had lost his job in a leather tannery in December 1999 when he was retrenched as
the industry downsized. Even then, five years into South Africa’s democratic transition,
unemployment rates were rapidly increasing (reaching 38.6 percent in 1998),9 and by the end of
that first decade approximately one million jobs had been lost in mining, manufacturing, and
agriculture. These retrenchments were consistent with the state’s implementation of structural
reforms (ironically, self-imposed), while deregulation saw the financial sector expand to
approximately 21 percent of GDP even while employing only a small fraction of the active
workforce (see OECD 2002)10.
There are many interventions to be made in the debate over the success or failure of post-
apartheid economic policy—whether rapid growth has sustained or undermined development or
whether eschewing job creation has in fact dealt a fatal blow. It is certainly fair to say the poor
have been sidelined by a “mode of globalized economics that produces socioeconomic growth
without a commensurate increase in regular wage-paying work” (Murray 2011:149-150). For all
that, volatility in the South African economy and the fact of growing inequality seem particularly
pressing issues. Both strike hardest at the already vulnerable—those without shelter or jobs, the
city itself as a site of both surplus production and struggles over access to surplus, which is
deployed in developing urban infrastructure and in turn enabling the conditions for speculation.
At the other pole, lack of access to capital produces spaces in which neither adequate
infrastructure nor a formal housing market (on which to speculate) exist as in those many
peripheral zones that border the city of Cape Town. These dual forces have not only produced
marginality; they have sustained preexisting marginal relations predating 1994.
Many of South Africa’s economic problems first emerged during the crisis years of the
1970s (a period of over-accumulation of capital) and have worsened with the country’s belated
insertion into the world financial system (cf. Arrighi 1994; Harvey 2003b). Financialization
tends to intensify pre-existing uneven relations inasmuch as specific circuits of capital have a
propensity to expand at much faster rates than others and in so doing create two quite distinct
areas—the one speculative (and hence volatile), the other given to decline (Ashman, Fine and
Newman 2011a). In an economy previously organized around “uneven and combined
development”—as Left scholars were already arguing in the 1970s given the relation of the labor
9 While 2013 third quarter estimates of unemployment hover at 25 percent (see
http://www.statssa.gov.za/publications/P0211/P02113rdQuarter2013.pdf accessed December 13, 2013) for the
period with which the latter half of my field research was concerned 2001 Census data are particularly relevant.
Data disaggregated for Ward 35 (see
http://www.capetown.gov.za/en/stats/2001census/Documents/2006%20Ward035.htm, accessed December 13, 2013)
indicate that approximately 48 percent of people between the ages of 15 and 65 were employed during the period. It
should be emphasized, the South African government has opted for a “narrow” definition of unemployment
covering those seeking jobs, rather than all those of working age desiring job. Notwithstanding this fact, that almost
52 percent of working age people in Ward 35 were unemployed at the time speaks volumes of the unevenness in
joblessness rates across the country and the ways in which unemployment is concentrated in informal settlements
and rural areas. 10 See http://www.oecd.org/dataoecd/48/38/1826412.pdf, accessed December 1, 2013.
6
reserves to the country’s cities (see for example Wolpe 1972, 1975)—financialization
exacerbates historically produced unevenness.11 Taken together (a history of radical inequality
and financialization), South Africa has become not only one of the most unequal societies but, in
response and of necessity, the protest capital of the world. Volatile or unstable in two senses
then—in the political and economic sense—the South African economy has sustained fully six
currency crashes between 1996 and 2011 and a sizeable real estate bubble. The latter has led to
an expansion of the consumer credit market, mortgages for the most part (see for example Desai
and Pithouse 2004), and to unsustainable lending driven by consumerism. For ordinary
borrowers high interest rates set by the Reserve Bank—a strategy for belatedly integrating South
Africa into the global financial system—have generated unserviceable levels of debt (cf.
Lazzarato 2011) and in many instances served as the grounds for eviction from homes with
underwater mortgages. In this sense, there is a direct relationship between financialization and
homelessness.
As labor intensive industries (and the production of real goods) gave way to a focus on
financial markets—and corporate treasuries turned to finance capital in search of higher
returns—unemployment levels increased during the mid to late1990s, while many surviving jobs
were casualized. Those who remained in formal employment now bore the added responsibility
for supporting multiple dependents straining already fragile networks of kin (see for example
Barchiesi 2011).12 For a majority of black households this translated into a renewed reliance on
the informal economy, informal circuits of lending and borrowing (including loan sharking),
consumer credit, and an emerging welfare apparatus. Long staples of township life, the fact of
growing structural unemployment suggested increased dependency on informal financial
institutions broadly understood as “financial mutuals.” To be clear, these have a long history
dating back to the nineteenth century. Indeed, with the advent of the migrant labor system,
financial mutuals assisted families with domestic reproduction as households came to span long
distances between the rural areas and the towns. A point to which I will return below.
By early millennium, while black households renewed efforts in self-reliance, the cities in
which they were based, Cape Town included, listed from crisis to crisis—in housing and service
delivery as well as in the employment sector—and yet these were somehow secondary
considerations for city managers and local government officials who turned their attentions,
instead, beyond South Africa. A (failed) bid on the 2004 summer Olympics was quickly
followed by a successful bid to host the 2010 Soccer World Cup. In a new world of “global
cities” and competition with faraway rivals municipal responsibilities have been seemingly
reduced to concerns for international tourism revenue. Thus, by 2010, rather than fulfilling
promises of job creation and public spending, the state was instead placing the finishing touches
on costly soccer stadia. And in the year preceding the World Cup South Africa lost an additional
1.3 million jobs (Bond 2013:577). Supplanting the vision of a post-apartheid city committed to a
11 The expansion of the financial services industry and the focus on shareholder value in driving corporate profits is
largely a phenomenon dating back to the 1980s. 12 The aftermath of Marikana quickly showed that miners who struck demanding wage increases were not only
living in squalid conditions in nearby squatter settlements, but in addition most supported upward of forty
dependents on meager wages. Franco Barchiesi has rightly argued that beyond the problem of growing structural
unemployment in South Africa wageworkers bear particular risk too (2011). They are not only super-exploited in
the mining and agricultural sectors in particular, they also carry those who have fallen out of the wage labor market.
See for example “Marikana Miners in Debt Sinkhole,” Lisa Steyn, Mail and Guardian, September 7, 2012. See
http://mg.co.za/article/2012-09-07-00-marikana-miners-in-debt-sinkhole, accessed December 13, 2013.
7
shared responsibility for welfare and equality the notion that Cape Town and other cities might
be regarded as “world class” won the day.
At the grassroots, in communities like Lower Crossroads and adjacent townships,
alongside the informal marketplace most households came to depend on monthly pensions and
child support grants. If the period since the early 1990s had seen the withdrawal of the state and
the penetration of market relations in housing and service delivery; notably, this was also a time
for the steady rollout of a fairly comprehensive system of social assistance, directed precisely
towards undoing the “racial welfarism” of the past (McDonald and Smith 2004:1461). How
could this be genuine neoliberalism? To be sure, social grants (including state pensions and
child welfare support), widely acknowledged as the benefits of these may be,13 are not
necessarily inconsistent with corporatization as an initial phase of neoliberalization. That public
goods, including water and electricity, are delivered with the assumption of full cost recovery—
something that would have been antithetical to the old welfare system—highlights the ways in
which many “benefits” of the new South African state have tended to be offset by additional
costs.
Take the case of government funded schools where the expense of uniforms, textbooks,
and other “fees” deny the poorest children full access to education and where “learners,”
consequently, attend school inconsistently depending on the ability of their families to come up
with the necessary funds. Ferguson has argued that the extensive apparatus of social grants
(based on disability, parental status, or age eligibility) and the proposed basic income grant
(BIG), are “both pro-poor and neoliberal” (Ferguson 2007:79, emphasis in original) and as such
ideologically incoherent. Though social grants undeniably sustain households their capacity for
genuine poverty reduction is questionable not least because economic policy in South Africa has
been so aggressively focused on growth rather than job creation leading to a significant decline
in labor’s portion of the social surplus. In this sense, social grants can hardly be said to be “pro-
poor” or poverty alleviating even if many South Africans have become heavily dependent on
them.14
The Wage Puzzle
At 65, Solomon began collecting a state pension amounting to approximately R800 a month
(USD $120 at the time), while three Mfeketo children were of working age, but had no work, and
a fourth child was still attending school. Very soon, the state pension became a primary source
of income making the household more or less indistinguishable from households across South
Africa, in townships and squatter settlements, rural villages and remote homesteads, where jobs
are scarce and prospects for re-employment are practically non-existent. Excepting the fact of
how common the Mfeketos’ predicament was (and is), as relevant was the kaleidoscopic speed
of state devolution: from post-revolutionary promises of democracy and a caring state
(contrasting so radically with the old regime) to a dramatic shift away from the liberal social
13 See for example “New Study Again Proves Worth of Social Grants in South Africa,” Rebecca Davis, Daily
Maverick, November 27, 2013. See http://www.dailymaverick.co.za/article/2013-11-27-new-study-again-proves-
worth-of-social-grants-in-south-africa/#.UqH5qI3TQ_4 accessed December 6, 2013. 14 In 2005 the total consumer expenditure for the bottom 60 percent of South Africans was slightly less than that of
the top 5.7 percent (totaling over R172 billion. See “Poor Make Rich Pickings,” Hilton Shone, Sunday Business
Times, January 30, 2005. Further, insofar as a deracialized welfare system is concerned it is worth pointing out that
the level of many subsidies fell dramatically between 1994 and 1999, as in the case of the child grant, which
dropped 40 percent.
8
contract and towards a commitment to markets. What David Scott has referred to as the new
“blackmail of democracy” (Scott n.d.); a ruse that depends on linking good governance and
market reforms, particularly in the Third World. Little wonder that mutual aid, burial societies,
and savings schemes—important as these had always been in black social life—were becoming
absolutely critical.
Economists have been hard pressed to explain how it is that economic actors survive in
the face of very few resources, even as microeconomics professes a concern with household
earnings and patterns of consumption. By contrast, anthropology has long conceived of the
domestic arena in a way exclusive of questions of consumer behavior and rational choice, and
rather in terms of processes of social reproduction in its broadest sense—defined not only as the
material and biological basis of existence, but its symbolic, and ritual ground as well. Yet, with
so much of the world’s population reliant on informal sources of income and no apparent
substantive means of social reproduction the questions that economists seek to answer are surely
more pressing than ever (see Davis 2006; also see Sayer and Walker 1992; Hutchinson 1996;
Piot 1999; Weiss 2004; Ferguson 2006). One attempt to unravel this economic mystery or
“wage puzzle” has come in the form of a South African study,15 which argues that the nation’s
poor make use of a dizzying array of both formal and informal financial instruments for the
purposes of surviving one financial year to the next (see Collins, Morduch, Rutherford and
Ruthven 2009; cf. Roitman 2005). The study showcases a combination of mechanisms for
saving, banking, borrowing, lending, and channeling money into socially reproductive labor.
These include: bank accounts, pensions, insurance, store credit and credit cards, retirement
savings, and debt administration, as well as savings schemes, burial societies, and loan sharking.
Like many parts of the world, popular rotating credit and savings schemes offer the advantages
of one, increased purchasing power, in that members generally pool resources when looking to
make large household purchases, and two, promote fairly consistent saving by encouraging
members to do so as a group. The study rightly observes that while poor households may have
very little money “this [doesn’t] mean that they [don’t] manage what they have.”
In South Africa, financial mutuals have a relatively extended history. In the second half
of the nineteenth century, following the discovery of gold and diamonds and with the advent of
migrant work, families confronted the problem of retaining the integrity of households that were
essentially scattered across significant geographical distances. Burial societies, for example,
functioned in part to assure the return of the deceased to the ancestral home and were, and still
are, accommodating of groups ushering from a given region, in the case of Xhosas the Eastern
Cape—whether Cala, Lady Frere, or Pondoland. Similarly the stokvel or umgalelo, the savings
scheme, served to guarantee a degree of financial security in the face of the risks of long distance
migration, the inevitable lean times in a given year, and the general uncertainties of living
outside the formal banking system. With proletarianization and forced resettlement families
were less able to depend on one another so that financial mutuals served to enable reliance on
people other than kin as well. Such informal institutions and funds remain hugely popular in
South Africa and by all accounts are responsible for upward of R1-2 billion in annual turnover
(Bähre 2007b). That many residents of both Old and Lower Crossroads still maintained ties to
the rural Eastern Cape and were inured to a tradition of financial mutuals meant that many were
members of all manner of schemes even in the early 00s.
15 The “Financial Diaries” survey is probably one of the most extensive studies of financial practices amongst the
poor and was in part motivated by government and financial industry awareness of the need to offer financial
services to poor households in South Africa (see www.financialdiaries.com accessed December 19, 2013).
9
For several years, Edith had belonged to a savings scheme along with nine other
members. Thandu ‘Xolo (Lover of Peace) was a formal association that boasted a written
constitution with strictly observed regulations. The group had been making monthly
contributions of R30 (approximately USD $4.50 in 2006) per member over the course of eleven
months—January through November. While December was set aside as a time for cashing out
and preparing for the following year: paying annual school fees, buying uniforms and books,
making the journey to the rural areas, and attending to general home maintenance, including
roofing, and repainting. The “December holidays” were not so much associated with religious
celebrations per se, even as people referred to the giving of Christmas gifts, as they were with
both the ritual and practical reproduction of the household, perhaps most symbolically marked by
the circumcision of young men. Indeed, trips to the rural Eastern Cape were directly linked to
the desire to see young boys enter circumcision schools (abakwetha) close to familial
homesteads and in so doing effectively renewed connections between town and country as well
as shared lifeworlds separated by hundreds of miles. Young boys, on the other hand, destined to
become “new men” or amakrwala through a central rite of passage, spoke of the generational
aspects of social reproduction as critical to their complete integration into the world of adults and
all the privileges and responsibilities that attended the transition.
The group had a fixed deposit16 (or savings) account and three of the members served as
co-signatories going to the bank after monthly meetings to deposit contributions. The co-
signatories were also responsible for notifying the bank of large withdrawals, usually just before
December, for maintaining the association ledger, and guaranteeing a minimum balance in the
association’s account. To the uninitiated, collective savings groups present no particular
advantages over individual banking. But almost universally, those who participate in what are
locally referred to as umgalelo argue that saving together rather than alone is much more
rewarding, in a double sense. Members who pool resources in a fixed deposit account see their
savings appreciate incrementally with interest earnings as compared to the much smaller sums
they might deposit individually. The interest earnings on fixed accounts were approximately
7.0-7.3 percent in 2006 (based on annual deposits of R10,000 or less). And while Edith was
unsure of the exact rate, she insisted she had made considerable interest earnings in the prior
year, though, given a spike in inflation her real rate of return would have been negative. But
perhaps just as significant, is that deposits of this kind demand a very particular form of fiscal
discipline. The group restricts the withdrawal of funds in so doing redirecting consumer desire
and ensuring the security of the domestic balance sheet. What seems to underwrite such
disciplining is the logic of delayed gratification through which lump sums are converted into a
steady trickle; what Karl Polanyi thought of as redistributive and reciprocative systems or
“redistribution writ small” (cf. Polanyi 2001).
These activities depend on the constitution of a certain kind of self-regulating subject—a
“responsible and moral individual and economic-rational actor” (Lemke 2001:201). Members
often spoke of “belt-tightening” strategies, comments consistent with discourses of self-
empowerment that have become pervasive in the context of the devolution of state welfare
functions. While it is easy enough to argue these were compensations for the failures of the
market such discourses are equally legible as the means through which social actors transcend
their existing frames of reference. Thus, on one hand such narratives of frugality and self-
restraint expose the limits to social reproduction and yet simultaneously highlight the myriad
16 Note that a so-called Standard Bank “Society Scheme” is geared precisely to umgalelos and encourages group
savings.
10
ways in which subjects act upon the world and in so doing reshape the very structures of
austerity and fiscal discipline. These are not only moral-rational subjects then, but subjects with
a highly pragmatic orientation to lived circumstances (Comaroff and Comaroff 1997:66).
Edith’s umgalelo had been in operation for almost fifteen years. Established in Old
Crossroads, the scheme moved when its members were relocated to a transit camp in Lower
Crossroads in the early 1990s, following their ouster from Crossroads by local strongman,
Jeffrey Nongwe. Not all such schemes are this stable of course and many function without
formal banking instruments; instead participants make contributions to one another on a rotating
basis throughout the year and recipients have discretion in the use of funds.17 Both systems have
their advantages, although generally, those making use of the banking system are more resilient
and their schemes have greater longevity. The same is equally true of burial societies and the
presence or absence of a fund determines methods of payment to members, the size of
membership, and myriad aspects of the burial organization. The Mfeketos had certainly reaped
small, but meaningful benefits over time. The seats in the living-room, a kitchen unit, fridge,
bed, school fees, and uniforms had all been paid for through Edith’s hard work and due
diligence. She was the first to acknowledge that without the savings scheme and the support of
her fellow members, many of them neighbors and friends of longstanding, it would have been
virtually impossible to extend the kind of moral and financial support to her family in the way
that she had.
If self-imposed austerity measures can be understood as part and parcel of a new
neoliberal logic—a mode of self-regulation and of “savings as ‘spirit’ or ‘moral’ discipline”
(Khan and Pieterse 2004:30)—the broader context in which acts of abstention and austerity were
and continue to be enacted is just as critical to understanding responses to hardship.18 Consider,
the caprice of the Reserve Bank, specifically, wild fluctuations in interest rates, which undercut
rates of return and real purchasing power. Consider too, the increasingly speculative nature of
the South African economy as the productive sector gave way to financial services. In this
climate of uncertainty, umgalelos have taken on two distinct purposes: one, to surmount what
appear as the impossible challenges of living on the social margins, exposed to scarcity and
want, and two, in so doing, the schemes, have ironically, replicated the logic of micro-
entrepreneurialism so central to sustaining the privatization regime. Indeed, only a few years ago
municipal government in the City of Cape Town restructured housing subsidies to “encourage”
the practice of saving amongst low-income households, in so doing demonstrating a complete
ignorance of enduring practices of economization. For beneficiaries of housing subsidies the
consequences were significant: those without the financial means to provide their own homes
were, for the very first time since the implementation of a post-apartheid housing program,
17 See “Finance-South Africa: Rare Insights into Poor People’s Bank,” Christina Scott, Inter Press Service News
Agency, Sunday, January 7, 2007, www.ipsnews.net/print.asp?idnews=28818, accessed March 16, 2009. 18 I want to be cautious in suggesting that poor people are not consumers, they are. In fact, as Wal-Mart and other
low-end chains demonstrate the poor are a tremendous source of profit, largely by volume over price. Rather, my
point is that the mechanisms of “belt-tightening” to which many respondents referred, suggested on one hand
patterns of delayed consumption (waiting till December to make large purchases and so on), but on the other, a very
carefully drawn distinction between basic needs and notions of desire. These are not universal in any way, but at
every turn households necessarily negotiated a fine line between the two. Moreover, this is not an argument based
on assumptions about utility. Consider Helen Meintjes’ work on Soweto housewives and the uses to which so-
called “luxury” appliances are put (or not) in the running of households and what conceptions of useful and highly
valued labor are at stake in decisions about washing clothes by hand while owning a washing machine, for example
(2001).
11
obliged to make statutory top-up payments (drawn from savings) on otherwise free benefits. A
similar logic informs the introduction of school feels, the argument being that small contributions
promote a sense of ownership in public education, ignoring the challenges this poses for out-of-
work parents.
This isomorphic relationship between official policy and everyday life, between so-called
formal and informal economies, is central to a set of questions that organize my argument about
urban poverty, specifically through the conjuncture of kinship and political economy (White
2001a), the politics of domestic life and politics more broadly. What sort of practice and politics
of life and forms of life does this conjuncture foreground and what connections might these have
to a much broader set of global forces? The practices of fiscal austerity I have described till this
point strike at the core of households, not only on the peripheries of South African cities, but
cities globally, and raise vexing questions about the linkages between housing and the
reproduction of labor power, particularly in circumstances in which security of housing tenure is
not assured. Further, what kinds of new subjectivities emerge in the face of the partial
disarticulation of daily life from circuits of capital and commodities, not least wage work; what
forms of desire are shaped by austerity; and how does austerity refigure, often enough, complex
practices of money exchange, lending, and abstention? For example, how is it that in contexts of
spiraling debt, exorbitant interest rates, and land speculation—all symptoms of the
transnationalization of cities—that institutions of money lending, saving, and banking amongst
the poor come to correspond to certain aspects of the larger political economy, specifically to
heightened levels of personal indebtedness. Notably, in poorer households, the resort to both
formal and informal credit instruments has taken on critical dimensions. In a statement by the
Financial Sector Campaign Coalition in May 2004 the difficulty in transforming financial policy
to promote growth reflected a number of concerns ranging from limited investment in the public
sector to the enduring problem of diversity in terms of the “nature, size, and ownership of
institutions.” However, the statement was particularly concerned with the question of debt. And
I quote:
While the “richest South Africans pay on average 20% interest for credit per annum, [the]
poorest pay on average 175%! The state of indebtedness of our people is at crisis point.
Only last week the Constitutional Court dealt with the plight of Karoo residents who lost
their houses for miserable debts of as little as R198 for buying food on credit.19
Debt as Politics: The Search for Financial Sovereignty20
My focus on the domestic space as a site of uncertain reciprocative and redistributive work
highlights the challenges facing South Africans living on the margins of the new democracy.
Wherein the uncertainty that comes with efforts to socially reproduce households translates into
a general anxiety that little can be brought to completion; that the conditions of possibility for
life itself are at once virtually impossible and yet must be faced however in extremis the situation
19 See “Statement by the Financial Sector Campaign Coalition on Financial Sector Transformation,” May 26, 2004.
Also see the “Financial Diaries” study, which suggests that in households surveyed an “average household portfolio
ha[d] 4 savings instruments, 2 insurance instruments and 11 credit instruments” a measure of the degree to which
credit and indebtedness are critical to day to day survival. 20 I borrow the term “financial sovereignty” from the film Bamako. Directed by Malian filmmaker, Abderrahmane
Sissako, Bamako sits squarely in the tradition of “j’accuse” and sets the stage for a trial of the World Bank by
members of African Society.
12
might be. Families like the Mfeketos and others I describe below, continually invent and
reinvent the worlds they occupy in ways that both deftly acknowledge and ignore the “crisis”
that seems to engulf them, suggesting that crisis is not particularly useful in explaining how lives
at once severely circumscribed by need are often simultaneously sites of aspiration and hope.
Hoping for something and willing its realization are grounds for a certain futurity and for
keeping crisis at bay, while such hopes in their turn translate into directed attempts at
transformation, if only minute ones—through the melding of old shacks with new RDP houses,
through small and enterprising survivalist businesses, through the dispatching of school-age
children to the countryside to be cared for by extended family. The broader question implied by
these observations concerns the ways in which social actors, while limited in their capacities to
change the worlds they occupy, nonetheless become sufficiently inventive so as to outdo, again if
only in small ways, the conditions of their own existence, often enough working to connect new
and old forms—again, this is most concretely given in the amalgamation of brick homes and
shanties—and thereby in a sense risking what is already known (Sahlins 1995:247) in order to
redefine the possible from within the constraints of dominant structures.
Edith Mfeketo, Unathi (a close friend of Edith’s), and several others frequently referred
to the era of apartheid wage work as a time of great challenge, but also certainty. Racially
discriminatory welfarism and exploitative relations of the wage21 placed women in the position
of having to subsidize households. At the same time, weekly wages provided a small, but
regular flow of resources some of which were diverted into burial associations and savings
schemes. By contrast, post-liberation, the very same schemes while continuing to serve as
savings funds also took on a more prominent role in lending. Opened up to the global market
place, South Africans now confronted a barrage of images and messages about conspicuous
consumption—on highway billboards, in shopping malls, and on television, and for some even
on the Internet—that presupposed purchasing power. Yet the new consumer culture remained
without foundation in a solid wage economy. The younger generation’s response to the
paradoxes of the new consumer culture have been particularly striking, notably the recent
emergence of i’khothane derived from the Zulu word ukukhothana meaning to “lick like a
snake” or to compete playfully. Young people in the townships are increasingly organizing
potlatch like events where money and expensive clothes are burned in highly performative acts
and through which prestige and respect are accrued. Spoken of in generational terms, that is
assuming the incommensurability of an older working class set of aspirations and those of
younger people seasoned to non-work or the absence of work, i’khothane has become a
generational flashpoint.
In the remainder of this paper, I want to address various economic survival strategies and
the ways in which these confront a new kind of material politics or “material-possible.”
Specifically, I want to consider the place of debt and the use of credit instruments, both formally
and informally.
The Matter of Risk
At each stage, risks can be converted into securities, sliced up, repackaged, sold on and
sliced up again. The endless opportunities to write contracts in underlying debt
instruments explains why the outstanding value of credit-derivatives contracts has
21 On the mines, given the system of company stores and remittances to the countryside, miners could find
themselves virtually penniless despite wage earnings (cf. Taussig 1987).
13
rocketed to $26 trillion—$9 trillion more than six months ago, and seven times as much
as in 2003.
—The Economist22
No progressive observer of the US economy can fail to be startled by the high level of
debt borne by the bulk of the population. These are folk who borrow not for luxury, but
for survival.
—Vijay Prashad (2003:4)
Scholars of South Africa have noted the peculiar synergy between the formal and informal
economies (see for example Ashman, Fine and Newman 2011a; Bond 2013)—heightened
speculation in financial and real estate markets on one hand and the use of (consumer) credit
amongst the poor on the other. One of the critical sites of continuity between formal and
informal sectors arises precisely in the extension of “unsecured credit” by banks to the nominally
employed. Joining with micro-finance institutions and the pervasive township loan shark or
gooi-gooi scheme (a pyramid scheme)23 banks encourage over-leveraging leading to aggressive
debt collection down the line. Indeed, in the aftermath of the August 2012 Marikana miners’
massacre, at the heart of miner discontent over meager wages was the fact of their indebtedness.
“It did not take long before the lenders’ role in mineworker finance was identified as central to
the worst police massacre in a half-century” (Bond 2013:580).
If the poor are prone to spiraling debt, depend on loan sharking, and other brokerage
relations offering practical, if limited, solutions to the non-productive nature of post-wage work;
the “casino economy, with all its financial speculation and fictitious capital formation (much of it
unbacked by any growth in real production)” (Harvey 1989:332) replicates some of the very
same strategic errors. Both involve a faith bordering on the occult; a faith in the generative
properties of transactions involving either money or capital, and on a general principle: namely
that value can be conjured from nothing or rather from what are largely immaterial stand ins for
value itself. Just as derivatives derive value from other things, other assets, the movement
towards finance seems to depend on producing redundant populations for “capture” by a growing
subprime industry.
We would do well to recall the formula by which money is converted into commodities
and commodities into money prime or M-C-M’ (through “buying in order to sell” as Marx put it)
and how that formula, in the “absence” of commodity production, is rewritten as M-M’ where
capital generates more capital, somehow unmediated by the commodity production process.
Marx was not unaware of the potential of money markets of course nor apparently was John
Wesley who referred to “the hidden, incestuous breeding of cash without exertion” as ‘pariah’
capitalism (see Wesley 1985:271, 276 in Comaroff and Comaroff 1997:172; also see Marx
1991a; Harvey 1982). Marx’ “general formula for capital” concluded with the case of interest-
bearing capital. That is, a mode of circulation in which the intermediate stage was lost and
money begot money or as he characterized it “money which [was] worth more money, value
which [was] greater than itself” (Marx 1990:257). Yet Marx’ primary emphasis on productive
forces and the relations of production as the mechanisms driving world history made the sphere
of circulation a less likely focus, at least as a relative matter. The prominence of finance capital
in the twenty-first century however is hard to ignore, as is the sphere of circulation that makes it
22 See “The Dark Side of Debt,” The Economist, September 23, 2006, p. 11. 23 Gooi-gooi refers to an in-and-out investment.
14
so profitable. Indeed, the emergence of circulation “as the cutting edge of capitalism” has
transformed aspects of our modern market economy in quite radical ways decoupling capital
from sites of production while the forces of circulation have tended to reorganize national
borders, the integrity of national economies, and the very functions of the liberal state (LiPuma
and Lee 2004:9).
Whereas such “cultures of circulation” (Lee and LiPuma 2002) signal the amplification
of circuits of finance capital, and whereas such circuits and their velocity may distinguish the
contemporary conjuncture, the apparent absence of “real production” also marks a mystification
not so much the actual dissolution of the commodity, namely abstracted labor value, in the M-C-
M’ formulation. Still, labor’s apparent disappearance—that is, through a series of geographical
displacements (what Arrighi and others have termed “spatial fixes”)24 (see Arrighi 1994)—is
paralleled by the very real experience of absent wage work and the concomitant spiraling of
extremes of wealth and poverty. In such circumstances experiences of the everyday are
transformed just as the shape and scope of the narratives describing such experiences take on
strange and new form.
Those who somehow beat the odds—riding the roller coaster economy with its currency
crashes, high interest mortgages, and necessary defaults—are thought to have sold their souls to
the devil, devised Faustian pacts, or consorted with witches. In rural South Africa, for example,
farmers perceived to profit against the odds of bad weather, blight, and low commodity prices,
do so, it is argued, because they benefit from the free labor of zombies in their control—armies
of which descend into the fields by moonlight and reap profits for their masters. But just as
zombies come to haunt their owners, following them everywhere “like unruly shadows. Or the
alienated essence of their own labor” (Comaroff and Comaroff 1999:803) bad investments and
the debt they create haunt their investors too. In this sense, financial markets are equally prone
to what I will call mythical thinking, which is to say they assume, particularly in environments in
which certain instruments function outside the reach of regulators and the “velocity of capital”
stands in for “real money,” that profits can be arbitraged in the lag between the moments of
investment and return. And just as zombies persist in reminding their masters of their savage
exploitation, so investing in certain sectors carries enormous risks. Trading in credit is one such
case.
On the one hand there can be no doubt that financial product innovations and especially
new debt instruments associated with new information, communications and technology
simply permit a greater debt load without necessarily endangering consumer finances
(Bond 2006:21).
On the other hand, as the subprime mortgage market’s collapse has shown, there are limits to the
debt burden individuals and formal institutions can bear.25
Marx’ primary object of de-reification was surely the commodity. And one way to
debunk the notion of value as intrinsic to the thing was to show the ways in which commodities
were implicated in a network of social relations and, most fundamentally, the labor process. In
24 One such example would be the emergence of free enterprise zones, which sit “outside” the borders of nation-
states, and effectively conceal or displace sites of production. 25 While personal savings rates hit an all time low in the US in the lead up to the credit crisis, in 2005 and 2006 in
particular, in the aftermath of the beginning of the recession savings rates rose, hitting a new high of approximately
7% of disposable income in the second quarter of 2009.
15
this way the thing-ness of the commodity was set against the process of labor alienation of which
it was a direct and immediate outcome. Marx argued that this process was concealed by the
science of political economy, which instead construed value as a series of formulae bearing “the
unmistakable stamp of belonging to a social formation in which the process of production has
mastery over man, instead of the opposite, [and] appear[s] to the political economists’ bourgeois
consciousness to be as much a self-evidently and nature-imposed necessity as productive labour
itself” (Marx 1990:174-175).
My point in rehearsing Marx’ well-known critique of commodity fetishism is the
following: at least in some formalist sense, both finance capital and other informal transactions
that assume capital and money, respectively, as central to their endeavors, dissolve M-C-M’ into
M-M’. It is particularly striking then that in two entirely distinct sectors of the economy—the
one financial and hence “formal,” the other “informal,” for want of a better term—wage work
has become more or less dissolute. In the one instance fewer and fewer actual workers are
required to drive the culture of circulation, while structural unemployment has given rise to an
ever-expanding informal sector, as manifest expression of systemic redundancy. But is this
really a crisis or something more permanent? As Janet Roitman has recently observed, by
common acknowledgement (in both banking circles and amongst neo-Marxists), systemic risk is
built into the market system (Roitman 2014:72-73) belying discourses of redundancy as “crisis,”
which tend to mask the very mechanisms by which superfluous populations are necessarily
produced (see Arendt 1994; Mbembe 2004).
Edith and Unathi have not been alone in waxing nostalgic about the days when their
husbands had full-time wage-paying jobs. The new post-apartheid state has been equally
invested in the notion of the “worker-citizen” (Barchiesi 2011)—a powerful, if anachronistic,
symbol now deployed to define the new democratic citizenship. The re-emergence of the trope
is particularly notable given the job losses that have come with the political transition and stands
in stark contrast to the rapid growth path advocated by neoliberal ideologues.
So admitting then that the idea of the laboring subject is something of an anachronism,
contingent on an older theory of labor once realized through travel to urban areas from the
countryside and through access to wage work, what purchase do such reveries have on the
present? This yearning for apartheid wage work presumably stripped of repressive politics—a
desire for “sweat” as a precondition of material security—in my view is also linked to an
increasing debt burden in most households (see for example Lazzarato 2011).26 Further, debt
and indebtedness while substantially increasing much as they have elsewhere (see Makhulu,
Buggenhagen, and Jackson 2010), not least in the United States, begins to gesture at other kinds
of de-substantiation such as the concrete world of material objects, including homes—as the
bricks and mortar basis of fundamental security and as its metaphorical foundation too.
Finally, I want to highlight the contrast in the popular imaginary of a difficult near past of
work and oppression and a present in which “freedom” has come, but cannot be practically
enjoyed. In such a case, what are the alternatives by which freedom—in both a political and
material sense—might be achieved? For residents of Lower Crossroads, and similar townships
and squatter areas across the Flats, the options come in a variety of forms, but one at least has
both fascinated and perplexed me: the quest for a kind of financial autonomy by means
seemingly both arcane and incredibly practical. The financial markets, as we know, continually
seek new alternatives to instruments and sectors that no longer generate the kinds of profits they
26 Here, “debt” covers a whole range of brokerage relations including store credit, credit card debt, informal loans,
even loan sharking, in other words, monies owed in both formal and informal sectors.
16
did. To be sure, what Adam Smith called “prodigals and projectors” (1977) those players in the
market who were likely to promote risky speculation, the likes of which were instrumental in the
collapse of the credit markets in September 2008, are a far cry from the “errors of undue
optimism” (Pigou 1929), if they are indeed that, in which South Africa’s working poor engage
today. Still, I believe the comparison is worthwhile.
The Mjwana Family27
The Mjwanas, like Edith and her family, resided in Lower Crossroads. In 2006, Nomalady
Mjwana belonged to a large savings scheme forty members strong. The scheme was based in
Old Crossroads (just as Edith’s had been fifteen years before) and had been in operation since the
late 1980s, when it convened in “Section 5,” Boystown, named for a boy’s reformatory that was
located there when the area was still partially given over to farming. The group, Masibonisane,
“Let’s Help Each Other Advance,” met weekly at Sikilela Primary School. While contributions
were made throughout the year, the group generally recessed during January when people were
on holiday in the Eastern Cape. Again, the notion of “holiday” is somewhat misplaced in the
sense of bourgeois leisure time. Rather the December period was clearly an opportunity to
accomplish the hard work of social reproduction. And umgalelos are an engine of this process,
enabling young boys’ initiation into adulthood, the construction of rural homesteads, investment
in children’s education through school fee payment, and the purchase of books, and uniforms.
Weekly contributions of R10 were significantly smaller than those made in other savings
groups. These smaller amounts were made more frequently consistent with the limited staple
income flowing into the household—including child support grants—as well as the timing of
earnings from Nomalady’s husband’s casual gardening job and a small food stand at which she
worked a few days a week. As a consequence, Nomalady contributed R30 a week and made
additional payments on behalf of several of her children: Bongiwe, Phumlani, Phelokazi, and
Nasiphi. The incentive to contribute on her children’s behalf (a practice in which many women
engaged) encouraged saving that would have otherwise been quite difficult. Ideally, Nomalady’s
contributions totaled R150 per week, while she also paid a R2 “transport contribution.”
“Transport money” covered the costs of cosignatories and other members who took it in turns to
travel into central Cape Town to the bank to make deposits into a fixed account. Annual
contributions were registered in two separate ledgers, maintained by two members specially
appointed to the task, and spoke volumes of efforts at transparency, offering an entirely new take
on the idea of double-entry bookkeeping and “fair value” accounting. The ledgers reflected
identical transactions: contributions, deposits, and in some cases money owed, as well as
additional transactions or mashonisa (loan sharking). A third ledger only recorded “transport
money” entries.
The Masibonisane constitution stipulated that contributions were made regularly, that
meetings were attended, and began punctually, and when absent that members sent on a formal
apology delivered by another member. These binding rules encouraged regularity of
contributions and the overall stability of the group. Again, self-discipline, moral rectitude, and
self-imposed fiscal restraint characterized the ideal subject who could be a member of such a
scheme.
27 Nomalady was 48 when I first knew her. Her husband was ten years her senior and had been forced to enter semi-
retirement. They had three daughters and one son ranging in age from 10-25.
17
Nomalady ran a sweet stand on one of the major thoroughfares feeding off the R300
motorway and across the road from a local wholesale supermarket. She worked there every
other day, usually Monday, Wednesday, Friday and the weekend. Most days, depending on
business, she made anywhere from R50 to R70 in profits;28 she sold sweets, crisps, yoghurt, and
occasionally fruit. The R200-R350 she made each week rarely covered her target weekly
contribution of R152. When she was unable to make the whole contribution in one go she found
ways to catch up by the end of the month. Strategies included participating in so-called gooi-
gooi (or unstable, in-and-out) schemes where money could be rapidly recuperated. A second
strategy involved acting as a loan shark. Members of the scheme who either needed additional
funds or wished to make extra money would lend to other, poorer neighbors, and friends. And
Nomalady had been known to lend at very high interest rates seeing in the high risk of default the
potential for maximizing profits by charging upward of 50 percent interest on loans, which, if
recuperated yielded further profits through interest earnings from the bank. Alternatively,
members could also borrow from the scheme itself, that is, once at least R400 worth of
contributions had been made for the year. Evidently, Nomalady and others believed that risk
would be generally offset by informal modes of securitization—one form of contribution might
be offset by contributions made elsewhere or by the practice of lending to others.
At the end of any given year the three co-signatories presented the scheme’s ledgers to
the bank and withdrew funds for all its members, leaving a small amount on deposit for purposes
of keeping the account open. Nomalady withdrew close to R7600 at the end of 2005; this money
was used to transport family members to the Transkei for the December period, for the slaughter
of a cow for a family celebration, the re-fencing of the homestead, groceries, school fees, and
uniforms for the following year, the initiation of a young man in the extended family, and finally
the re-painting of the family’s shack in Lower Crossroads. Again, the project of making home—
in both its narrowest and broadest sense—was central to Nomalady’s daily reckonings.
Other resources in the Mjwana household included income from Pius’ casual gardening
work. He was 58, pre-retirement age, and worked fairly irregularly in and around Cape Town.
In addition, one of the younger children continued to receive a child support grant of R180 a
month.29 It was undeniable that the apparatus of social assistance was becoming absolutely
essential as South Africans witnessed dramatic declines in real income—on average 40 percent
from 1995-2000.30 Through it all the Mfeketos and Mjwanas persisted in the hard work of
reckoning daily the conditions for life—engaging in “money struggles” (Guyer, Denzer, and
Agbaje 2002)—perpetuating cycles of domestic reproduction that black Capetonians had long
ago set in motion, even as they were forced to negotiate the disruptions and violence of
migrancy, influx controls, and dispossession under apartheid.
Conclusion
While South Africa’s transition from minority to majority rule has been popularly held up as an
extraordinary feat, in practice, the enjoyment of democracy’s benefits have been limited to a
28 Fluctuations in daily takings are related to the times in the month when pensioners receive their social grants (at
the time of my interviews this was R800 per month) and mothers with dependents collect child grants (these were
approximately R180 per child at the time). 29 Since the completion of research interviews in 2006 both child grants and pensions have been significantly
increased—to R250 a month for children (extended to the age of 18) and R1,080 a month for pensioners. 30 See “Why South African Incomes Declined,” Andrew Balls, http://www.nber.org/digest/jan06/w11384.html,
accessed December 13, 2013. Also see the National Bureau of Economic Research Working Paper No. 11384.
18
small minority. What Tom Holt in describing the emancipation of Jamaica in 1838 suggested
was a “‘freedom’ drained of the power of genuine self-determination” (1992:xxv). True, today,
ordinary South Africans make all manner of claims on the state and the majority enjoy rights of
full citizenship for the first time now the old Bantustans and labor reserves have been dismantled
and legalized racial discrimination has been struck from the statute books. And yet, not
insignificant numbers of South Africans remain under threat of eviction; live in communities
with limited access to state resources; in areas of the country where jobs are scarce, and schools,
and primary healthcare practically inaccessible. These are certainly problems of longstanding
that no government could possibly secret away in the space of two decades.
At the grassroots people have responded by organizing against the privatization of basic
needs, stressing instead the decommodification of access to water, electricity, housing, and other
benefits and services. In turn, the state’s rejoinder has been less than predictable, further
evidence of the confusing and complex continuities between state and capital. It would seem
that neoliberalism “works by multiplying sites for regulation and domination through the
creation of autonomous entities of government that are not part of the formal state apparatus and
are guided by enterprise logic” (Sharma and Gupta 2006:277). If sites for regulation and
domination have indeed multiplied, sites of protest politics have multiplied too.31
Of course constitutional democracies privilege the rule of law, often ignoring the vast gap
between formal and substantive citizenship. Further, many new democracies must come to terms
with recent histories of colonial overrule that necessarily bring into question the very
foundational assumptions of the “procedural republics” (Sandel 1984) they seek to conjure—
namely the degree to which jurisprudence can actually serve the cause of justice. The wide rift
between form and content is therefore perhaps most visible in post-revolutionary societies. Yet
hyper-conscious of the discrepancy in definitions of citizenship, communities of protest across
South Africa have been quick to take up rights talk precisely in order to make demands on the
state and thereby demonstrating a dexterity of political strategy. While this may be a cause for
some optimism, it is equally clear that socio-economic rights have become “the main terrain of
struggle”32 between the state and civil society and as such signal an ever-widening ideological
gulf between the presumed values of political emancipation and market freedoms.
And so the reckoning continues.
In a way, this paper has been a meditation on the problem of “reckoning” after apartheid.
By this I mean several things: accounting materially and morally for a past that was profoundly
unjust; reckoning too in the sense of accounting, day by day, for the ways in which the present
can be lived; pragmatically assessing possibilities for making home in the city of Cape Town
(other cities too) and in so doing reproducing life itself. Each of these modes of reckoning
suggests a kind of bookkeeping. And as we have seen this is precisely what people do: they
calculate the probability of “marginal gains” in contexts of want and extreme inequality (Guyer
2004). And so a vast number of Capetonians organize their lives, homes, and settlements
through minute calculation of the costs—material and moral—of risking life on the periphery as
the condition of a precarious hope (cf. Allison 2013; Standing 2011).
31 See “Frustration Boils Over in Protests: Community Angered at Snail Pace Service Delivery,” Bheko Madlala,
Daily News (Durban), October 14, 2005; “66 Cops Injured in Illegal Service Delivery Protests,” Cape Argus,
October 13, 2005; “The Story of State Repression in the South African Transition,” Dale T. McKinley and Ahmed
Veriava, Pambazuka News, May 13, 2004; Centre for Civil Society Research Reports 2006. 32 See http://www.fxi.org.za/pages/Anti-censorship/Progress%20Reports/ACP_6th%20Progress%20Report.html,
accessed March 16, 2013. FXI notes that the Minister of Safety and Security, Charles Nqakula, reported 5,085 legal
and 881 illegal protests in South Africa in the 2004-2005 financial year.
19
References Cited:
Allison, Anne
2013 Precarious Japan. Durham, NC: Duke University Press.
Arendt, Hannah
1994 The Origins of Totalitarianism. New York: Harvest Book, Harcourt, Inc.
Arrighi, Giovanni
1994 The Long Twentieth Century: Money, Power, and the Origins of Our Times. New
York: Verso.
Ashforth, Adam
2000 Madumo: A Man Bewitched. Chicago: University of Chicago Press.
Ashman, Samantha, Ben Fine and Susan Newman
2011a “The Crisis in South Africa: Neoliberalism, Financialization and Uneven and
Combined Development.” Socialist Register 47:174-195.
2011b “Amnesty International? The Nature, Scale and Impact of Capital Flight from South
Africa.” Journal of Southern African Studies 37(1):7-25.
Bähre, Erik
2007b Money and Violence: Financial Self-Help Groups in a South African Township.
Boston: Brill.
Barchiesi, Franco
2011 Precarious Liberation: Workers, the State, and Contested Social Citizenship in
Postapartheid South Africa. Albany: SUNY Press.
Bond, Patrick
2006 Looting Africa: The Economics of Exploitation. London: Zed Books.
2013 “Debt, Uneven Development and Capitalist Crisis in South Africa: From Moody’s
Macroeconomic Monitoring to Marikana Microfinance Mashonisas.” Third World
Quarterly 34(4):569-592.
Booth, Charles
1989 Charles Booth’s London: A Portrait of the Poor at the Turn of the Century, Drawn
from His Life and Labour of the People in London. New York: Pantheon Books
[1889].
Center for Civil Society
2006 Yonk’ Indawo Umzabalazo Uyasivumela: New Work from Durban. Research
Reports: Volume One. Durban: University of KwaZulu-Natal Press.
Collins, Daryl, Jonathan Morduch, Stuart Rutherford, and Orlanda Ruthven
2009 Portfolios of the Poor. Princeton: Princeton University Press.
20
Comaroff, Jean and John L. Comaroff
1999 “Alien-Nation: Zombies, Immigrants, and Millennial Capitalism.” The South
Atlantic Quarterly 101(4):779-805.
Comaroff, John L. and Jean Comaroff
1997 Of Revelation and Revolution, Volume Two: The Dialectics of Modernity on a South
African Frontier. Chicago: University of Chicago Press.
Davis, Mike
2006 Planet of Slums. New York: Verso.
Desai, Ashwin and Richard Pithouse
2004 “‘What Stank in the Past is the Present’s Perfume’: Dispossession, Resistance, and
Repression in Mandela Park.” The South Atlantic Quarterly 103(4):841-875.
De Soto, Hernando
2000 The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere
Else. New York: Basic Books.
Ferguson, James
2005 “Seeing Like an Oil Company: Space, Security, and Global Capital in Neoliberal
Africa.” American Anthropologist 107(3):377-382.
2006 Global Shadows: Africa in the Neoliberal World Order. Durham, N.C.: Duke
University Press.
2007 “Formalities of Poverty: Thinking About Social Assistance in Neoliberal South
Africa.” African Studies Review 50(2):71-86.
Ginsburg, Rebecca
1996 “Now I Stay in a House.” African Studies 55(2):127-139.
Guyer, Jane I.
1995 Money Matters: Instability, Values, and Social Payments in the Modern History of
West African Communities. Portsmouth, NH: Heinemann.
2004 Marginal Gains: Monetary Transactions in Atlantic Africa. Chicago: University of
Chicago Press.
Guyer, Jane I., LaRay Denzer, and Adigun Agbaje, eds.
2002 Money Struggles and City Life: Devaluation in Ibadan and Other Urban Centers in
Southern Nigeria, 1986-1996. Portsmouth, NH: Heinemann.
Harvey, David
1982 The Limits to Capital. Chicago: University of Chicago Press.
1989 The Condition of Postmodernity: An Enquiry into the Origins of Cultural Change.
New York: Blackwell.
21
2000 Spaces of Hope. Berkeley: University of California Press.
2001 “Spaces of Utopia.” In Between Law and Culture: Relocating Legal Studies, David
Theo Goldberg, Michael C. Musheno and Lisa C. Bower, eds. Minneapolis, MN:
University of Minnesota Press.
2003b The New Imperialism. New York: Oxford University Press.
Holt, Thomas C.
1992 The Problem of Freedom: Race, Labor, and Politics in Jamaica and Britain, 1832-
1939. Baltimore: The Johns Hopkins University Press.
Hutchinson, Sharon
1996 Nuer Dilemmas: Coping with Money, War, and the State. Berkeley: University of
California Press.
Khan, Firoz and Edgar Pieterse
2004 “The Homeless People’s Alliance: Purposive Creation and Ambiguated Realities.”
Research report for the project on Globalisation, Marginalisation & New Social
Movements in Post-Apartheid South Africa. Durban: The Centre for Civil Society
and the School of Development Studies, University of KwaZulu-Natal.
Lazzarato, Maurizio
2011 The Making of the Indebted Man. Amsterdam: Semiotext(e).
Lee, Benjamin and Edward LiPuma
2002 “Cultures of Circulation: The Imaginations of Modernity.” Public Culture 14(1)191-
213.
Lemke, Thomas
2001 “‘The Birth of Bio-Politics’: Michel Foucault’s Lecture at the Collège de France on
Neoliberal Governmentality.” Economy and Society 30(2):190-207.
LiPuma, Edward and Benjamin Lee
2004 Financial Derivatives and the Globalization of Risk. Durham, N.C.: Duke
University Press.
Makhulu, Anne-Maria, Beth Buggenhagen and Stephen Jackson
2010 “Introduction.” In Hard Work, Hard Times: Global Volatility and African
Subjectivities. Makhulu, Anne-Maria, Beth Buggenhagen and Stephen Jackson, eds.
Berkeley: University of California Press.
Malinowski, Bronislaw
1984 Argonauts of the Western Pacific. Prospect Heights, Ill.: Waveland Press [1922].
Mangcu, Xolela, Gill Marcus, Khehla Shubane and Adrian Hadland, eds.
2007 Visions of Black Economic Empowerment. Auckland Park: Jacana Media.
22
Marx, Karl
1990 Capital: A Critique of Political Economy, Volume I. trans. Ben Fowkes. London:
Penguin.
1991a Capital: The Process of Capitalist Production as a Whole, Volume III. London:
Penguin.
Mauss, Marcel
1990 The Gift: The Form and Reason for Exchange in Archaic Societies. Trans. W.D.
Halls, foreword by Mary Douglas. London: Routledge [1950].
Mbembe, Achille
2004 “Aesthetics of Superfluity.” Public Culture 16(3):373-405.
McDonald, David A. and Laïla Smith
2004 “Privatizing Cape Town: From Apartheid to Neoliberalism in the Mother City.”
Urban Studies 41(8):1461-1484.
Meintjes, Helen
2001 “‘Washing Machines Make Lazy Women’: Domestic Appliances in the Negotiation
of Women’s Propriety in Soweto.” Journal of Material Culture 6(3):345-363.
Modisane, Bloke
1963 Blame Me on History. New York: E. P. Dutton & Co.
Murray, Martin
2011 City of Extremes: The Spatial Politics of Johannesburg. Durham, NC: Duke
University Press.
Nelson, Diane
2009 Reckoning: The Ends of War in Guatemala. Durham, NC: Duke University Press.
Neocosmos, Michael
2011 “Transition, Human Rights, and Violence: Rethinking a Liberal Political
Relationship in the African Neo-Colony.” Interface 3(2):359-399.
Perlman, Janice
2010 Favela: Four Decades of Living on the Edge in Rio de Janeiro. Oxford: Oxford
University Press.
Pigou, Arthur Cecil
1929 Industrial Fluctuations. London: Macmillan.
Piot, Charles
1999 Remotely Global: Village Modernity in West Africa. Chicago: University of Chicago
Press.
23
Polanyi, Karl
2001 The Great Transformation: The Political and Economic Origins of Our Time.
Boston: Beacon Press.
Prashad, Vijay
2003 Keeping Up with the Dow Joneses: Debt, Prison, and Workfare. Cambridge, Mass.:
South End Press.
Reddy, Sanjay
2004 “A Capability-Based Approach to Estimating Global Poverty” in “Dollar a Day:
How Much Does it Say?” a special issue of In Focus, a publication of the
International Poverty Centre, Brasilia.
Roitman, Janet
2005 Fiscal Disobedience: An Anthropology of Economic Regulation in Central Africa.
Princeton: Princeton University Press.
2014 Anti-Crisis. Durham, NC: Duke University Press.
Ross, Fiona C.
2003 Bearing Witness: Women and the Truth and Reconciliation Commission. London:
Pluto Press.
Roy, Ananya
2003 City Requiem, Calcutta: Gender and the Politics of Poverty. Minneapolis:
University of Minnesota Press.
Sahlins, Marshall
1972 “The Original Affluent Society.” In Stone Age Economics. Chicago: Aldine-
Atherton, pp. 1-39.
1995 How “Natives” Think: About Captain Cook, for Example. Chicago: University of
Chicago Press.
Sandel, Michael J.
1984 “The Procedural Republic and the Unencumbered Self.” Political Theory 12(1):81-
96.
Sayer, Andrew and Richard Walker
1992 The New Social Economy: Reworking the Division of Labour. Cambridge, MA:
Blackwell.
Scott, David
n.d. “Norms of Self-Determination: Thinking Sovereignty Through.” Paper presented at
the Social Science Thursday Luncheon Seminar, Institute for Advanced Study,
February 8, 2007.
24
Scott, James C.
1998 Seeing Like a State: How Certain Schemes to Improve the Human Condition Have
Failed. New Haven: Yale University Press.
Seekings, Jeremy and Nicoli Nattrass
2005 Class, Race, and Inequality in South Africa. New Haven: Yale University Press.
Sharma, Aradhana and Akhil Gupta, eds.
2006 The Anthropology of the State: A Reader. Oxford: Blackwell.
Sitze, Adam
2013 The Impossible Machine: A Genealogy of South Africa's Truth and Reconciliation
Commission. Ann Arbor, MI: University of Michigan Press.
Smith, Adam
1977 An Inquiry into the Nature and Causes of the Wealth of Nations, Edwin Cannan, ed.
Chicago: University of Chicago Press, [1789].
Standing, Guy
2011 The Precariat: The New Dangerous Class. London: Bloomsbury Academic.
Taussig, Michael
1987 Shamanism, Colonialism, and the Wild Man: A Study in Terror and Healing.
Chicago: University of Chicago Press.
Weiss, Brad, ed.
2004 Producing African Futures: Ritual and Reproduction in a Neoliberal Age. Leiden:
Brill Press.
White, Hylton
2001a “Tempora et Mores: Family Values and the Possessions of a Post-Apartheid
Countryside.” Journal of Religion in Africa 31(4):457-479.
Wilson, Richard A.
2001 The Politics of Truth and Reconciliation in South Africa: Legitimizing the Post-
Apartheid State. Cambridge: Cambridge University Press.
Wolpe, Harold
1972 “Capitalism and Cheap Labour-Power in South Africa: From Segregation to
Apartheid.” Economy and Society 1(4):425-456.
1975 “The Theory of Internal Colonialism: The South African Case.” In Beyond the
Sociology of Development: Economy and Society in Latin America and Africa,
Oxaal, Ivar, Tony Barnett, and David Booth, eds. London: Routledge.