Gary Kendall
Gary Kendall

South Africa on the brink

Two weeks into the truckers’ strike and South Africa stands on the precipice of serious societal breakdown. The Marikana massacre was undoubtedly a tragic event in its own right, although it may prove to have merely been the spark that lit the fuse.

The powder keg waiting to explode is the imminent shortage in liquid fuel supplies. Unless the country pulls itself back from the brink, we are in for a national state of emergency.

It may play out something like this.

As fuel supply lines further constrict, many motorists will understandably choose to fill up their tanks “just in case”. Filling stations will quickly run dry, supermarkets operating at the end of complex just-in-time supply chains will see their inventories deplete, exacerbated by panic buying brought on by sensationalist media coverage. Within days, severe food shortages will result, and we’ll be running a real-time nationwide experiment to test the veracity of the adage that civilisation is, at any one time, only nine meals away from anarchy.

Factories will close their doors as production lines grind to a halt, with companies unable to procure raw material supplies or shift burgeoning product inventories. More and more banks and ATMs will run out of cash; emergency services will find themselves simultaneously inundated with calls for assistance as violence and desperation spreads, yet unable to respond due to their own fuel shortages; hospitals will cancel all but the most critical operations as remote doctors and nurses struggle to reach their place of work; burials will be postponed and corpses will pile up in morgues. The country will come to a complete standstill and many of the characteristics of modern civilised society that we take for granted – trust, human decency, a lawful majority – will evaporate.

If all this sounds rather fantastical and unlikely, recall that it has already happened.

In the United Kingdom (UK), just 12 years ago last month, a protest by road hauliers against high diesel prices led to blockades of refineries and fuel terminals, and culminated in a week-long social experiment that will be remembered by anyone who experienced it. The world’s fourth largest economy (at that time) unravelled within a matter of days.

The challenge facing South Africa today is not identical, though situational differences should not lead us to a position of complacency. The UK dispute specifically targeted transport fuel supplies at source, whereas the current crisis involves the road haulage sector (which is but a critical component of the supply chain) as a whole.

However, throw in some extremely combustible kindling created by entrenched social inequalities and legitimate labour grievances – which have found their most recent violent expression in the extractives sector disputes – and we have all the conditions necessary for collapse.

The extent of our dependency on liquid transportation fuels – overwhelmingly derived from oil, more often than not from unstable parts of the world – becomes vividly apparent only when they no longer flow freely.

Until this moment, we scarcely give a moment’s thought to how pervasively oil seeps through every aspect of our lives.

Note also that absolute physical shortages are not necessary; with the human tendency to hoard in anticipation of a crisis, all that is required is for the notion to take hold that limited fuel supplies are a distinct possibility.

It becomes a case study in self-fulfilling prophecies.

Of course, none of the above is inevitable in the coming weeks. What is likely, however this plays out, is that we will recover from the crisis and return to some semblance of normality without properly facing up to – much less addressing – this pernicious dependence on liquid fuels.

To the extent that we pretend to deal with it, our “answers” will probably be found in synthetic oil substitutes – coal liquefaction and Karoo shale gas – proffered as a pathway to national energy security that insulate us from undemocratic regimes in faraway desert lands. It’s a shell game – a confidence trick designed to keep our eyes away from the real prize. It’s methadone for our collective heroin addiction.

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    • OneFlew

      No, the UK didn’t ‘unravel in a matter of days’. I drove my car to work as usual and so did all my colleagues. None of us starved. There were admittedly some inconveniences. Team meetings that had been scheduled for remote locations were postponed until the whole thing blew over. As it inevitably did.

      Which is of course not to say that SA couldn’t ‘unravel in a matter of days.’ Maybe it can. Maybe it will.

      But the UK didn’t. And, on reflection, any comparison of this kind between two completely different countries on the basis of some spurious similarity between the problems each has confronted is bound to end in tears.

    • Michael Stone

      South Africans are finding out that an overvalued Rand currency leads to lower growth rates; lower interest rates are hitting pensioners hard even as workers drown in a sea of ‘cheap’ consumer debt they cannot repay.

      There is social pain; widespread national wildcat strikes roll across many sectors of the economy, unleashing an orgy of anger at union politicians inability to fulfill unrealistic promises in our prevailing culture of BEE elite entitlement. Denialism has led to an ATM mentality, that thinks that punching in higher salaries ‘somehow’ produces more money and revenue – job losses, unfortunately, are the reality. Magical thinking abounds: “12%, R12,500 minimum” has replaced Nkosi sikelel’ iAfrika as the mantra in the new south africa, where the voiceless find expression in Julius Malema.

      Despite this, there has so far been only a modest fall in the rand. South Africa Government Bond 10 Years increased to 6.57% on October 4 of 2012, very attractive compared to the near zero yields on offer in the US and UK. As a result, the chances of an undervaluation of the ZAR are remote, almost irrespective of muddled Government policy which sways perilously between the Chinese communism and labour protectionism.

      The conseqence is a shrinking, deflating real economy which can ill afford the grandiose pipe dreams of NHI and NSSF ; the collective kitty of taxpayers is required to stimulate the economy, including infrastructure investment in energy, roads, water…

    • Paul S

      Don’t panic just yet, Gary, We’ve seen a lot of this before. You’re clearly the new kid on the block as far as socioeconomic cause and effect anaylsis goes. SA (and many other far more developed countries) have been subject to this same cyclical challenge many times before. Short term angst maybe, but not a lot implied for the medium to long term. Africa, she’s a tough nut.
      Hate to say it, but you almist sound hopeful.

    • http://www.thoughtleader.co.za/garykendall Gary Kendall

      @ OneFlew

      My recollection of those days is somewhat different from yours (not to suggest yours is wrong, just that we experienced the same events differently).

      I was working for an oil company, so I had some experience from inside the system. I was home-based in the Wirral, with industrial customers spread over a large territory stretching from Stafford to Aberdeen. I was unable to drive at all that week due to fuel shortages, and some plants were forced to halt production, send people home.

      Of course, the ship was righted before the country went to the dogs, but not before a series of emergency meetings in Whitehall with business leaders and government, including the PM. I remember supermarkets running out of food and reports of people fighting over loaves of bread – not what I’d call civilised behaviour, albeit understandable when people are in fear of not being able to feed themselves, irrespective of whether that fear was likely to be realised.

      Despite circumstantial differences – no two countries are identical, of course – I think parallels can be drawn and lessons can be learned through studying history. More likely to end in tears if we don’t. SA’s transport sector is no less dependent on liquid fuels than the UK’s was, or still is.

      A good analysis of the UK events is provided here (by the Canadian government, evidently keen and willing to learn the lessons):

      http://www.publicsafety.gc.ca/prg/em/ccirc/2005/ia05-001-eng.aspx

    • Eazyboy Matjila

      We will be sitting and sipping the Americano reading the events of a good and fulfilling day at the stock markets…This will have been achieved due to the high price of transportation fuels- as they would have forced all driving South Africans to realise that driving is not a perfect choice for the working masses of South Africa.

      Cars will be so cheap as every car dealer will be highly stacked with piles of non-buyable cars as no one will be in need thereof- The South African Government is trying although in not so convincing manner-to create a public transport system- that wil be so cheap for everyone in South Africa to afford.

      We are so self absorbed by our own wary wishes to see the worse happening to this beautiful rich country- Yes it might be written in the books that for peace to reign in formally oppression run countries, there must be a civil war- that will never be a case in South Africa… The majority of South Africans know what poverty is and have survived through it for a long time. I will not even dream of a violently torn apart South Africa as yet, until another government takes over and changes the status quo. Then Gary, the stage will be yours….

    • Juju Esq.

      @Gary

      Interesting perspective to weave fossil fuel addiction/dependency into this web of SA living on the brink.

      So true, so true.

      Personally I think any number possibilities of could be the spark that lights the South African powder keg, however, if we eliminated fossil fuels from the economy replacing them with renewable energy, it would be one less risk, and renewable energy would provide so many job opportunities, it would eliminate another of the major risks of this country unraveling, i.e. that of unemployment and poverty.

      Thought provoking read.

    • http://www.xen.co.za Hugh Robinson

      The chances of an unraveling her is far greater in SA due its penchant for violence if it does get its own way. Then we have the blame game that is skillfully played. That is the race and corporate card.

    • OneFlew

      Gary, I can see how it aids the narrative to highlight the parallels – see what can happen when truckers, and especially tanker drivers, get angry. It appeals to human psychology to have a tale that offers such a direct parallel.

      But that isn’t really the parallel.

      In the UK there was a short period of disruption by men in deck chairs outside refineries. The government were wrong-footed and the main lesson was ‘should we allow a situation where we are so easily thwarted by men in deck chairs?’ The resources and wherewithal existed to remedy the problem, but the situation exploited organisational inertia in government and in companies. So that is the main lesson.

      The main lesson isn’t that politeness among fellow citizens is sometimes a little lacking when there is competition for resources. That lesson is abundantly demonstrated on roundabouts every time there is congestion (or, heaven forbid, two inches of snow). It is demonstrated every morning on the tube.

      So I think the UK lesson is that angry lobbies can sometimes exploit chinks in the societal armour, not that they present a real existential threat to the order of things. I think your South African lesson is a slightly different one.

      (But yes, of course different people had different experiences of the event. Had one been the recipient of a bludgeoning-by-baguette I am sure the scars would remain. The other scarring event at roughly that time – the bovine funeral pyres – hurt a different set of…

    • Balt Verhagen

      A more relevant and real comparison is the ungovernability campaign – in South Africa – of the latter 1980’s. That was the culmination of an escalating national and in particular international – campaign against the apartheid regime. To what extent it really was an important factor in the CODESA process is an open question. The regime was already weakened economically and morally by widespread boycotts. What the ungovernability campaign did achieve was to establish a culture of non-payment for services, that came back to haunt the very ANC that fomented it when later it was running the show. The important point is that all sorts of lessons were learnt then that seem to inspire the present wave of protests, now in the form of strikes that use as their rallying point unheard-of wage demands. Conventional mediation channels are rejected as they are seen as corrupt and in cahoots with the perceived ‘exploiters’ which now include the ANC and its allies. ‘Service delivery’ protests were escalating and endemic for years. It was only a matter of time for the spirit of resistance to spark over to a much more effective ‘ungovernability campaign’ within the very bases of the country’s economy. Of course, the bandwagon of huge wage demands being acceded to is as inevitable as it is unsustainable. The point is that the socio-economic contract of 1994 has been seen to have been violated by the liberation organisation itself. Only a new contract can save the day for South…

    • http://www.thoughtleader.co.za/garykendall Gary Kendall

      Hmmm, I appear to have stumbled backwards into a sensitive area! I’m fascinated by the range of interpretations expressed above – thanks to all those who made comments for supplementing my understanding.

      @ Juju Esq.
      Well done for spotting the central argument that I intended, which is that crude oil represents a thin veneer that protects modern civilised society from deteriorating. It’s why countries and tribal factions are prepared to go to war over it. As Dick Cheney once put it: “Oil is unique in that it is so strategic in nature. We are not talking about soapflakes or leisurewear here. Energy is truly fundamental to the world’s economy. The Gulf War was a reflection of that reality.”

      @ OneFlew
      I do appreciate and acknowledge your different perspective. My 670 words were not intended to diagnose SA’s complex social issues, nor to compare protests in deck-chairs (lovely image!) with the current SA labour disputes. I wanted to shed light on what can happen when liquid transport fuels no longer flow freely. This can happen, it has happened. In my opinion (you may disagree), there’s a serious risk of this happening in SA now. If and when it does (I hope not), it may knock on surprisingly quickly in areas that one might not expect.

      Without the movement of people and stuff, real economic activity rapidly declines and people behave accordingly. And when transport is 95% dependent on a single form of primary energy (as it is, globally), that’s a really big…

    • MLH

      Transnet, although not on its toes this time around, will pray for a repeat performance soon, because it is convinced that it can get freight back onto rail. This won’t happen without a fight, due to costs, speed and far less predictable deliveries.

      I saw virtually the same article in one of the American online media a few days ago, actually tabulating the number of days it would take for SA to crumble. I felt a little skeptical of it, but given long enough, there’s no doubt things can go very wrong.

      Of course, without coal deliveries to power stations, we’re likely to run out of electricity before fuel and that puts several sectors under such severe pressure that they may need to consider taking a few days off. The state is a very slow thinker and I cannot see it canning Medupi or Kusile in favour of anything by gas…the ANC has a strange idea of what comprises status symbols.

      Strikers who went out before their month-end salary will feel the pain soon and they need a far greater understanding of the two-way street that is business. Many will sadly come out of this little better than they went into it. So we’ll bite the bullet for another week and see how things go.

    • Enough Said

      Are the wide range of different of perspectives in the comments section genuine or are they spin doctors trying to dilute Gary Kendall’s central message? Anyone who takes on the fossil fuel industry, nuclear energy, Wall St banks, capitalism, free markets, big pharma or the agricultural biotech (GM crops) and pesticide industry in the media is a marked person, just in-case the citizenry realize they have been duped all these years. Public relations companies make an absolute mint of money trying to counter articles like this on behalf of vested interests with fake bloggers.

    • Enough Said

      Basically where-ever you look the oil/fossil fuel industry create devastation, look at Shell Oils environmental and human rights record in the Niger Delta;
      http://ccrjustice.org/learn-more/faqs/shell%2526%2523039%3Bs-environmental-devastation-nigeria

      Now this same company wants to Frack in the Karoo.

      Time to stop the Greenwashing and prosecute the criminals.

      >>>>

    • just a thought

      Legitimate labour grievances needs to be unpacked. I earn a smidgeon more than the mineworkers are demanding and i have three degrees, studied for 7 years and have worked tirelessly to obtain 6 years work experience. So if a rock cracker who does not need to manage financial budgets, coordinate specialised processes, appoint and manage professional teams believes he is worth that much then I think everybody who gets through a tertiary institution should have a starting salary of r30k per month. But thats not going to happen. Maybe the private sector should take to the streets and demand free mercedes on top of piles of caviar for lunch.

      I believe that if every worker was issued a monthly salary of R60k per month you can be sure he will be back on the streets torching everything in sight asking for way more for less work.

    • The Creator

      The trouble with this article is that it takes some alarmist right-wing anti-union scare-stories and then tries to use this to justify a nebulous critique of dependence on liquid petrochemical fuels. In doing the latter (which is no bad thing) it legitimates the former (which is extremely dubious).

      Besides, realistically speaking, we can’t do away with road freight completely (the most we can do is serve hubs more effectively with heavy rail systems) and even if we did, we would still need the drivers of the trains. In the end this depends on a fantasy of doing without workers altogether, which is also not a good idea.

    • The Praetor

      I would blow the authors analysis off at all. I think he has just given an insight to the very near future.

      The Praetor

    • Momma Cyndi

      I don’t think that comparisons between the UK and SA are possible. We simply have a vastly different way of looking at things. If you take, for instance, ‘load shedding’ we went through and compared what would have been the reaction in the UK, you’d come up with very different reactions.

      Johannesburg is NOT the whole of SA. Whilst it can be argued that they are a rather helpless bunch, the same cannot be said for the rest of the country. The ‘maak ‘n plan’ philosophy, that is so prevalent throughout Africa, is relatively strong still.

      Yes, our government should be looking at reducing fossil fuel dependence and producing a working public transport system. Yes, our ‘leaders’ should have contingency plans. That doesn’t mean we should throw the proverbial baby out with the bath water and allow Shell to ‘frack up’ the Karoo the way that they have destroyed the Niger Delta.

    • http://www.thoughtleader.co.za/garykendall Gary Kendall

      @ Momma Cyndi

      I didn’t intend to imply that fracking the Karoo is a good idea. I put the word “answers” in quotation marks (because GTL is advanced by the fossil fuel lobby as a solution) and then described it as a confidence trick, i.e. it’s not a legitimate answer at all (neither is coal liquefaction).

      Once again, the point is not to analyse the degree to which SA and UK are similar or dissimilar. Rather, it is to expose a truth which is terribly poorly understood by many citizens, which is the extent of society’s vulnerability to interruptions in liquid fuel supply. It’s fundamentally different from power outages (important as they are) because liquid fuels are the entire basis of our system of movement, which is to say “the economy”. What causes the interruption is less important than the effect. The reference to the impact of UK’s fuel protests was intended to demonstrate how quickly things can deteriorate, in what is/was ostensibly a civilised and stable country. Therefore it’s beyond the scope of the piece to unpack the origins of the current labour dispute, though I’m delighted if others want to do that in the comments section!

    • http://www.thoughtleader.co.za/garykendall Gary Kendall

      And then along comes this story, from the Canadian media (granted, those soft-bellied Canadians maybe don’t know how tough Africans are).

      “The labour unrest could become more chaotic this week as rail and port workers threaten to join 28,000 truckers whose strike has already disrupted fuel and food deliveries across South Africa, leaving some gas stations out of supplies, bank machines running out of cash and supermarkets suffering shortages of some products.”

      http://www.theglobeandmail.com/news/world/south-africas-ruling-party-paralyzed-as-strikes-choke-off-economy/article4595773/

    • Momma Cyndi

      Gary,

      SA is a big country with big spaces. That means that transport is a necessity. The only current alternative to fossil fuel in cars is electricity. With Eiskom in charge of electricity, that is Hobson’s choice at best.

      Coming from a family of ‘greasemonkeys’, the alternative energy for transport is something that I watch with interest. The H2O car and methane cars were interesting but impractical (particularly with out road accident rate). For now, we have petrol or bust. That was why Sasol was originally put into production – to prevent the threat of an oil embargo crippling the country.

      :) luckily we are not ‘civilized’ so the effect on us is less of a worry than the effect on the economy.

    • OneFlew

      Gary, re your point about dependency on oil versus, say, electricity.

      It is true that without oil things will grind to a halt quickly.

      Without electricity the same would happen. This was, in part, the subject of a massive ‘what if’ question that triggered considerable anxiety – hysteria even – in recent memory. The event? Y2K, of course.

    • http://www.sane.org.za Yaj

      @ Gary
      Great article. This is likely to play out as a trial run of what can be expected in the not-so-distant future as the global Peak Oil phenomenon unfolds while we are busy contemplating it.

      http://www.aspo.org.za

    • Tofolux

      @Gary, suggest you watch a documentary called “Peak Oil”.

    • http://www.thoughtleader.co.za/garykendall Gary Kendall

      @ OneFlew

      Re: transport fuels versus electricity, you’re missing the point. The electricity sector is subject to far less volatility and vulnerability. Electricity is obviously critical to the economy – only a fool would pretend otherwise – but it’s fundamentally different from the transport fuel sector. I’m still searching for a single example of a war starting over electricity (if anyone knows, please help).

      What needs to be understood is firstly the unique specificity of the transport sector to a single form of primary energy, and this makes it highly vulnerable. No other part of the energy system suffers from anything like it. Secondly, the economy is nothing without the movement of people and things. I’m talking about the real economy, not the moving around of pixels on Bloomberg terminals.

      While South Africa’s electricity supply is currently overwhelmingly powered by coal, it needn’t be: the country has autonomy on this, and it has an enviable bounty of sustainable renewable energy resources at its disposal, as well as nuclear power and natural gas if you prefer.

      However, if you want liquid transport fuels, you’re stuck with oil (supplies 95% of all transport fuel globally), coal (the most carbon-intensive activity known to humankind, terribly inefficient), natural gas (and throw away all of the carbon benefit in the process, a scandalous waste), or biofuels (and risk competition for land and water with the food supply).

    • OneFlew

      No, I don’t think the vulnerability is entirely unique. Firstly, you do have voliatility for a number of reasons. For instance:

      Eastern seaboard power outage 2012

      http://www.newsmax.com/US/power-outage-eastern-seaboard/2012/07/02/id/444166

      Then you have the volatility attributable to underinvestment in infrastructure, which causes outage spikes (rather than, in the case of fuels, just progressive tightening of supply which can be handled through pricing). South Africa may be a case in point. In at least this sense electricity supplies are more subject to volatility.

      Of course, liquid fuel is more affected by geopolitical factors than electricity, but both are subject to instability.

      But electricity networks, reliant as they are on a network of physical infrastructure which carries the product to the final consumer, are more vulnerable to physical damage. For instance sabotage-related. Or even in theory ‘solar storm’ – related.

      And I don’t think I’m missing the point, unless it’s a hitherto undisclosed one: your point was “what causes the interruption is less important than the effect”.

      And the effects are dire, whether caused by the weather, underinvestment, poor planning, nuclear ‘incidents’ or computer glitches.

    • Dr Eckner

      Good and interesting analysis. I think there is even more to it than SA’s dependency on liquid fuels and its tendency to violence. I think the ‘more to it’ is that SA is an enclave economy of a small minority (of all races) of productive workers, a parasitic and evil group of politicians who are supposed to be in charge but are no more than a mafia gang, and a massive, potentially violent underclass. This means that any major economic disruption – strikes, oil supply issues – are magnified by the basic lack of leadership in a leaderless society, and that most of the pressure and violence is targeted at the tiny productive minority. If this minority were to be unable to work and keep things going, the whole country would fall apart in a day.

    • Bernpm

      With the unions moving the strike to ports and docks, the whole set of actions might become more serious. While the parties do not seem to come any closer in their “negotiations”, the situation could indeed go beyond a little shortage here and a few power cuts there.
      Companies seem to have made contingency plans as I did not notice any shortages in shops in my area (1400 km from Johburg). Even our garage manager assured us that he has enough diesel in his tanks.
      Trucks are riding around without problems and life seems very normal for the average citizen. All media hype, one might ask. All Gauteng generated hot air???

      From where I sit, I am surprised that -with all these dark forecasts around- the government does not declare a “state of emergency”. No more protest actions allowed, block facebook, twitter and all other means to communicate, let police shoot at first sight……..in other words…create a war situation or else “do something” to prevent this madness from becoming a real war where nobody wins.

      Ban Cosatu from the ANC as the ANC did with Malemma. Alternatively, find yourself in a popular uproar with an unpredictable outcome and the potential of funding from outside sources. Fun to be had by all!!!
      Getting rid of the lame duck is not a solution because there are more lame ducks in the ANC succession lines.
      Force new elections and get rid of the ANC majority before war breaks loose.

    • bewilderbeast

      Classic “Shock Doctrine”: Allow things to get worse and worse until your victims come to you for “help”. You then step in “to the rescue” and move in with brutal police and troops. Declare emergency laws (which “happen” to stop all corruption investigations) and hey, presto! A whole lot of the kak you couldn’t manage has “gone away”! The ignorant celebrate the “Peace and Order at last!”. By the time they wake up and realise they’ve lost everything, it’s too late.
      Anyone think Zuma hasn’t thought of this?

    • Benny (the other one)

      Well, I work from home on the West Coast and have been avoiding the TV and papers for quite some time. I can quite honestly tell you the panicked cries from relatives over the phone telling me the apocalypse is nigh sound like they are coming from one of those apocalypse movies. Everything seems totally normal, including the traffic.

    • Momma Cyndi

      Could I ask, has anyone outside of the Joburg CBD experienced fuel shortages at their local garages?

      Other than Shell who ran out for about 24 hours, most of our garages in Pretoria have been business as usual.

    • Warawara

      Clearly some ppl are missing Gary’s point here…..i dont know if they too slow or pigheaded…..