EEPER EWS DDVOLUME 7 NUMBEREEPER1 NNEWS What willSouthAfricabelikein theyear 2002? The Mont Fleur Scenarios with anewintroduction by Mont Fleur facilitator, Adam Kahane DEEPER NEWS Network marks ofGlobalBusiness NEWS areregisteredtrade- D Network published byGlobalBusiness NEWS lished asTHEDEEPER D The Mont Fleur Scenarios [email protected] Nancy Murphy C http://www.gbn.org URL 510.547.8510 FAX 510.547.6822 P Emeryville CA94608 5900-X HollisStreet Global BusinessNetwork A Pete AllenCocke A Nancy Murphy Esther Eidinow Jenny Beery E DITORS HONE DDRESS RT MET AND OMMENTS EEPER EEPER D IRECTOR ® N N ) isaseriesofarticles EWS EWS ® and THEDEEPER (formerly pub- S UGGESTIONS Learning from Mont Fleur Scenarios as a tool for discovering common ground cenario thinking as a way of approaching the in their country over 1992–2002. (For a full list of future is increasingly being used as a tool for participants and their affiliations at the time, see page Sstrategizing in private and public sector organi- 21 of this Deeper News.) zations. The “Mont Fleur” scenario exercise, undertak- en in South Africa during 1991–92, was innovative Summary of the Scenarios and important because, in the midst of a deep con- flict, it brought people together from across organiza- The scenario team met three times in a series of tions to think creatively about the future of their three-day workshops at the Mont Fleur conference country. This Deeper News presents the Mont Fleur center outside Cape Town. After considering many scenarios as they were originally published in the possible stories, the participants agreed on four sce- South African newspaper The Weekly Mail & The narios that they believed to be plausible and relevant: Guardian Weekly, in July 1992. We hope this new introduction will provide a useful overview of the pro- • Ostrich, in which a negotiated settlement to ject, reflecting on its effects and the broader insights it the crisis in South Africa is not achieved, has provided. and the country’s government continues to be non-representative Context and Participants • Lame Duck, in which a settlement is The historical context of the project is important to achieved but the transition to a new dispen- understanding its impact. It took place during the sation is slow and indecisive period between February 1990, when Nelson Mandela was released from prison, and the African • Icarus, in which transition is rapid but the National Congress (ANC), Pan African Congress new government unwisely pursues unsus- (PAC), South African Communist Party (SACP), and tainable, populist economic policies other organizations were legalized, and April 1994, when the first all-race elections were held. During • Flight of the Flamingos, in which the govern- these years, dozens of “forums” were set up in South ment’s policies are sustainable and the coun- Africa, creating temporary structures that gathered try takes a path of inclusive growth and together the broadest possible range of stakeholders democracy (political parties, civic organizations, professional bod- ies, government departments, trade unions, business The group developed each of these stories into a brief groups, etc.) to develop a new way forward in a par- logical narrative. A fourteen-page report was distrib- ticular area of concern. There were forums to discuss uted as an insert in a national newspaper, and a 30- education, housing, economic policy, constitutional minute video was produced which combined cartoons matters, and many other areas. They ranged from with presentations by team members. The team then informal, off-the-record workshops to formal, public presented and discussed the scenarios with more than negotiations. The Mont Fleur project was one type of fifty groups, including political parties, companies, forum that, uniquely, used the scenario methodology. academics, trade unions, and civic organizations. At the end of 1992, its goals achieved, the project was The purpose of Mont Fleur was “not to present defin- wrapped up and the team dissolved. D
itive truths, but to stimulate debate on how to shape EEPER the next 10 years.” The project brought together a What the Project Was and Was Not
diverse group of 22 prominent South Africans— N EWS politicians, activists, academics, and businessmen, The ideas in the Mont Fleur team’s four scenarios from across the ideological spectrum—to develop and were not in themselves novel. What was remarkable disseminate a set of stories about what might happen about the project was the heterogeneous group of 1 important figures delivering the messages, and how the parties and then finding a way to narrow this group worked together to arrive at these messages. or reconcile these differences. The Mont The approach was indirect and the results subtle: Fleur process, in contrast, only discussed the domain that all of the participants had in • Mont Fleur did not resolve the crisis in common: the future of South Africa. The South Africa. The project, along with other, team then summarized this shared under- non-scenario forum processes, contributed standing in the scenarios. The aim of such to the establishment of a common vocabu- non-negotiating processes is, as Marvin lary and mutual understanding. The shared Weisbord, an organizational consultant, has language of Mont Fleur extended beyond stated, to “find and enlarge the common the negotiating elite, and was thus able to ground.” include such dialogues as an exhortation to Flamingos in a Sunday church sermon and a Results from the Project concern raised about Lame Duck on a rural radio phone-in. This kind of common The Mont Fleur project produced several different understanding, together with many other types of results: substantive messages, informal net- factors, promoted agreement upon a settle- works and understandings, and changed ways of ment to the crisis. thinking. The primary public output of the project was the group of scenarios, each of which had a mes- • The participants did not agree upon a con- sage that was important to South Africans in 1992: crete solution to the country’s problems. They reached a consensus on some aspects • The message of Ostrich was that a non-nego- of how South Africa “worked,” on the com- tiated resolution of the crisis would not be plex nature of the crisis, and on some of the sustainable. This was important because ele- possible outcomes of the current conditions. ments of the National Party (NP) govern- More specifically, they agreed that, given the ment and the business community wished prevailing circumstances, certain strongly to believe that a deal with their allies, advocated solutions could not work, includ- instead of a negotiation with their oppo- ing armed revolution, continued minority nents, could be sufficient. After hearing rule (Ostrich), tightly circumscribed majority about the team’s work, NP leader F.W. de rule (Lame Duck), and socialism (Icarus). As Klerk was quoted as saying, “I am not an a result of this process of elimination, the Ostrich.” broad outline of a feasible and desirable out- come emerged (Flamingos). • Lame Duck’s message was that a weak coali- tion government would not be able to deliv- • The process was not a formal, mandated er and therefore could not last. This was negotiation. Rather, it was an informal, important because the nature, composition, open conversation. At the first workshop, and rules governing the Government of some of the participants expected to National Unity (GNU) were a central issue encounter difficulties in agreeing on any- in the pre-election negotiations. The NP thing. Over the course of the meetings, wanted the GNU to operate subject to they talked until they found areas of shared vetoes and other restrictions, and the ANC understanding and agreement, several of wanted unfettered “winner takes all” rules. which were relevant to the formal negotia- Lame Duck explored the boundary in a
EWS tions which were occurring simultaneously.
N GNU between compromise and incapacita- tion.
EEPER • It did not deal with the differences among D the participants. Negotiation tends to focus • Icarus warned of the dangers of a new gov- on identifying the positions and interests of 2 ernment implementing populist economic policy. This message—coming from a team • The scenario process is logical. There is no which included several of the left’s most place in the core of a scenario conversation influential economists—was very challeng- for positions or values. Instead the discus- ing to the left, which had assumed that gov- sion is about facts and logic: can you con- ernment money could be used to eradicate vince your fellow team members that the poverty quickly. The business community, story you are putting forward is plausible? which was worried about Icarus policies, In the first Mont Fleur workshop, a story found the team’s articulation reassuring. The about the Chinese Red Army helping to lib- fiscal conservatism of the GNU was one of erate South Africa fell away on these the important surprises of the post-election grounds, rather than on the basis of prefer- period. ences.
• The simple message of Flight of the Flamingos • The process is open and informal. Building was that the team believed in the potential scenarios can be creative because the process for a positive outcome. In a country in the is “only” about telling stories, not about midst of turbulence and uncertainty, a credi- making commitments. This allows people to ble and optimistic story makes a strong discuss almost anything, even taboo sub- impact. One participant said recently that jects. Early in the Mont Fleur process, one the main result of the project was that “We of the ANC members proposed a story mapped out in very broad terms the outline called “The Chilean Option: Growth of a successful outcome, which is now being through Repression” (a play on the ANC filled in. We captured the way forward of slogan, “Growth through Redistribution”). those committed to finding a way forward.” This precipitated an important discussion which would not have had a place in a nor- The second result of Mont Fleur was the creation of mal left-wing party political debate. informal networks and understandings among the participants—an influential group from across the • The process is inclusive and holistic. A story political spectrum—through the time they spent about the future has to be able to encom- together. These connections were standard for this pass all aspects of the world: social, political, forum period, and cumulatively provided the basis for economic, cultural, ecological, etc. the subsequent critical, formal agreements. Moreover, the process of telling several sto- ries encourages people to surface and listen The third result—the least tangible yet most funda- to multiple perspectives. In discussing a fun- mental—was the change in the language and thought damentally unpredictable future, there is no of the team members and those with whom they dis- one truth; this accords respect for the points cussed their work. The Mont Fleur team gave vivid, of view of all of the participants (in a con- concise names to important phenomena that were not flict, one or more parties is usually not being widely known, and previously could be neither dis- heard) and it allows everyone to see more of cussed nor addressed. At least one political party the world. Poet Betty Sue Flowers says that reconsidered its approach to the constitutional negoti- working with a set of scenarios is like having ations in light of the scenarios. three or four different pairs of glasses, and that practicing putting them on and off Why the Project Produced These Results makes it easier for an individual also to see D
the world a fifth and sixth way. EEPER How can such a simple story-telling process produce these kinds of results? A scenario conversation has sev- N
• The process elicits choices. One of the EWS eral characteristics that make it powerful: premises of scenario thinking is that the future is not predetermined and cannot be predicted, which means, therefore, that the 3 choices we make can influence what hap- reflection and imagination, which is not pens. In a situation where people feel swept directly linked to action. Therefore, along by overwhelming, inevitable currents, although it is possible to follow on from this is an empowering world view. During constructing scenarios (what might happen) its transition, South Africa was haunted by to creating a vision (what we want to hap- apocalyptic visions; the scenario stories pen), and then to planning action (what we helped people rationally think through their will do), these processes must be carefully options. insulated from one another.
• The process is constructive. A scenario con- • Inclusive. The value of these projects is that versation turns the attention of a group they build the common ground among dif- away from the past and present—where the ferent perspectives and parties. It is therefore debate is often mired—toward the future. It important to be as inclusive as possible. The shifts from looking for The Solution to Mont Fleur project was unfortunately exploring different possibilities, and from diminished by its failure to include the the separate interests of the parties (as in Inkatha Freedom Party, which has been an negotiation) to their common ground (the important dissenter in South African poli- future in which they all will live). tics.
Pierre Wack, who pioneered scenario planning at The team needs to be: Royal Dutch/Shell, said that scenario work involves “the gentle art of reperceiving.” These characteristics • Respected—composed of leaders who are mean that a scenario process can facilitate shifts in influential in their own communities or language, thinking, and action. Each of these refram- constituencies. They need not hold “official” ings provides for a more constructive basis for work- positions. ing on difficult issues. • Open-minded (in particular, not fundamen- Conditions Necessary for a Successful talist) and able to listen to and work with Scenario Effort others.
The most important element required for the success • Representative of all the important perspec- of this type of scenario project is proper timing: are tives on the issues at hand. Any stakeholder public leaders ready to talk together about the future? must be able to see their point of view rep- If there is readiness, then two other things become resented by someone on the team, though critical: how the process is led and how the team is they need not be formal representatives of composed. these groups or positions.
The process must be: Conclusion
• Credible. The people who convene and lead The Mont Fleur exercise demonstrated the informal, the project must be broadly respected. They indirect scenario approach to be an innovative and must be seen as advocates of the process and productive method for a society in conflict to not of any particular position or outcome. approach the future. This approach is different from and complementary to negotiation. As this project EWS
N • Informal and reflective. A scenario exercise is demonstrates, it is a promising tool for future a “Track Two” process, which must be sepa- attempts to reach public consensus.
EEPER rate from (parallel or prior to) “Track One” D formal negotiations. The power of scenario 4 work comes from its status as an exercise in Adam Kahane Centre for Generative Leadership L.L.C. 205 Willow Street Hamilton, MA 01982 USA [email protected]
Adam Kahane is a founding partner of the Centre for Generative Leadership (Boston), an associate of the Centre for Innovative Leadership (Johannesburg), and a member of Global Business Network. An expert in the design and facilitation of processes that help people work together to anticipate and effect change, Adam served as the facilitator for the Mont Fleur scenario project. He has worked as a strategy consultant to public and private organizations and governments, companies, political organizations, NGOs, and multi- stakeholder forums in more than thirty coun- tries around the world. He has held planning and research positions in private companies, academic institutions, and international agen- cies, in Cape Town, Tokyo, London, Paris, Vienna, San Francisco, Vancouver, and Toronto. D EEPER N EWS
5
The Mont Fleur Scenarios by Pieter le Roux, Vincent Maphai, et al.
hat will South Africa be like in the year ical science head, and consulted members of the ANC 2002? In this supplement to The Weekly and PAC. WMail & The Guardian Weekly, the Mont Fleur Team identifies four possible pathways into The team included political office bearers, academics, South Africa’s future. The idea is not to present defini- trade unionists, and business people. It met for the tive truths but stimulate debate about how to shape first time at Mont Fleur near Stellenbosch in the next 10 years. September 1991. Adam Kahane of Shell International in London, a recognized expert on scenario planning, Plotting Pathways into the Future acted as facilitator and the exercise was funded by the Friedrich Ebert Stiftung and the Swiss Development A successful outcome for South Africa is still possi- Agency. ble—though there is no quick fix or panacea, con- cluded the Mont Fleur scenario team. After two further meetings at Mont Fleur (in November 1991 and March 1992) and a lot of work They also concluded that in between, the team muddling through is dan- reached consensus on the gerous. A decisive democra- “Based on my experience in strate- essential elements of four tic settlement is imperative. gic planning, this is one of the most core scenarios South Africa For South Africa to reverse meaningful and exciting scenario might follow between planning exercises ever undertaken. its decline and take off, The project has shown that a group 1992–2002. government policies will of experts and leaders with very dif- have to be sustainable and ferent perspectives and back- After further refinement, support socio-economic grounds can develop a common the scenarios were launched growth and development. understanding of what is going on in August 1992. They have now in South Africa and might (and since been presented to a should) go into the future. This These are the findings of seems to me to be a very positive wide range of audiences, probably the first scenario sign for the future of the country.” including the national exec- exercise in the world of this —Adam Kahane, utive committees of the broad scope undertaken by Mont Fleur Facilitator ANC and PAC, the a left-of-center group. National Party, key govern- ment departments, major Scenarios have generally been the planning preserve of corporations, and financial institutions. big business. Political scenarios are far less common. The team analyzed South Africa’s social, political, and The Mont Fleur scenario exercise was sparked in mid- economic crises and compiled 30 possible “stories” 1991 by a request to economist Pieter le Roux to about the course of events during the next decade. organize (yet another) major conference on South These included stories of revolution, economic growth Africa’s economic future. through repression, right-wing revolts, and free-mar- ket utopias. The 30 stories were carefully scrutinized Le Roux, director of the Institute for Social and sifted in terms of criteria such as plausibility and Development at the University of the Western Cape internal consistency. Nine stories survived and these D
(UWC), felt it was time for a different approach. were pared down to four by the end of the second EEPER meeting. N
He put together a multi-disciplinary team of 22 peo- EWS ple to work on possible scenarios for South Africa. To The scenarios describe what might happen to South do this he worked with Vincent Maphai, UWC polit- Africa. They are not blue-prints, but possible futures presented to stimulate debate and to emphasize that 7 South Africa’s future will be shaped by the decisions and actions of the major players. “Scenarios encourage disci- The name “Mont Fleur scenarios” was selected to plined, systematic thinking indicate that the scenarios belong to the group that about the future. A critical met at Mont Fleur and not to a specific institution or role of scenarios is to pre- organization. Team members participated in their per- sent different possible path- ways into the future to chal- sonal capacities. lenge conventional thinking and to encourage debate in The word “scenario” is often misused to mean “event” a process of learning.” or “situation.” —Koosum Kalyan, Shell
In fact, scenarios describe alternative pathways into the future. They project a range of possible outcomes and enable people to think about the future in differ- successful scenario planning exercise it is important to ent ways. They do not predict what will happen but set up a skilled team who can: identify what may happen. • Understand the present • Identify the predictable elements about the What Scenarios Mean future • Identify plausible possible pathways into the future Plausible scenarios must be internally consistent and • Take cognizance of divergent views based on credible interpretations of present trends. Scenarios are a strategic planning tool. They identify what has to be done to secure a desired outcome. Scenarios imply the future is not fixed but can be shaped by decisions and actions of individuals, organi- zations, and institutions. Scenarios are used to: The Scenario Process • Avoid being caught off guard Team members’ ideas • Challenge conventional mental maps about the First team workshop Brainstorming 30 future September 1991 initial ideas • Recognize signs of change Research Research • Test strategies for sustain- 9 preliminary stories ability in different cir- cumstances Second team workshop November 1991 Assessment There is no standard method Consultation 4 draft Consultation scenarios of developing scenarios. It is a EWS Third team workshop March 1992 Refinement N creative process that harnesses the expertise of the people EEPER involved (see above). For a 4 final D scenarios
8 8 Dissemination, debate, and use Agreement on the nature of South Africa’s crisis was Average Annual Growth Rates in necessary before the team could consider possible Gross Domestic Product and Fixed Investment future outcomes.
The team concluded that South Africa’s current crisis has three main dimensions: political, economic, and social.
The main elements of the political crisis are:
• The present system’s lack of legitimacy • Widespread mistrust of the security forces • A lack of faith in the judicial system • Repression, intimidation, intolerance, and These in turn are rooted in: political violence • Increasing exploitation of ethnic and regional • The unsustainability of South Africa’s tradi- divisions tional growth path based on primary exports • The collapse of black local authorities and (gold and minerals) and cheap labor the breakdown of services in many areas • Failure to develop a broad-based manufac- turing sector It’s a Fine Mess • Limited production of capital goods (such as machinery) needed for manufacturing South Africa’s economic crisis is characterized by eco- • South Africa’s isolation from the internation- nomic stagnation, declining investment, falling real al technological revolution per capita incomes, growing unemployment, and large • Lack of investor confidence income disparities.
The clearest symptom of the social crisis is the disin- tegrating social fabric in Logic of the Scenarios many communities, result- ing from:
Flight of the Flamingos • High unemploy- Inclusive democracy YES and growth ment Are the • Escalating political government’s and criminal vio- policies sustainable? lence YES NO • Inability of the Icarus health and educa- Macro-economic tion systems to populism Is the transition rapid meet the demands and decisive? made on them
• Collapse of many D Current YES NO rural communities EEPER Negotiations Lame Duck
• Rapid urbanization N
Incapacitated EWS Is a settlement government • Alienation among negotiated? the youth NO Ostrich Non-representative government 9 The political, economic, and social elements of the achieve inclusive democracy and growth current crisis are locked in a downward spiral of (Flight of the Flamingos). mutual cause and effect. Simultaneous intervention at all three levels is needed to reverse it. The images were chosen to make fairly abstract politi- cal and economic concepts accessible. The team argued that if the trends of the past 10 to 15 years cannot be reversed, South Africa’s problems are likely to be insoluble before the end of the decade. A political settlement and a new growth path are pre- requisites for progress. “It is understandable that business would prefer a long Four Possible Pathways transition. However, the unintended consequence of this is that it prolongs uncer- The Mont Fleur team’s point of departure was the tainty of what a future gov- current negotiation process. ernment will do. For the economy to take off a deci- Underlying these scenarios is the assumption that the sive political settlement fol- major parties are engaged in negotiations partly lowed by good government is imperative.” because they understand the dangers of irreversible —Johann Liebenberg, decline, and partly because the international climate Chamber of Mines strongly favors a negotiated settlement in South Africa.
The team foresaw four possible outcomes (see graph- ic) depending on the answers to three crucial ques- tions.
• Will negotiations result in a settlement? If not, a Possible Future Paths non-representative gov- ernment (Ostrich) will emerge. Flight of the Flamingos Inclusive democracy and growth • Will the transition be rapid and decisive? If not, there will be an Lame Duck incapacitated govern- Incapacitated ment (Lame Duck). government Settlement • Will the democratic gov- ernment’s policies be sus- Icarus Ostrich tainable? If not, collapse
is inevitable (Icarus); if Negotiations EWS
N the new government adopts sustainable poli- Non-representative
EEPER government cies, South Africa can D Macro-economic populism 10 No Settlement Stuck in the Past
The first scenario, Ostrich, depicts a government that does not want to face realities. An ostrich supposedly hides its head in the sand when danger threatens. The ostrich does not want to see, cannot fly, but has to lift its head in the end.
As a result of the steps taken by the De Klerk Although large-scale sanctions are not reimposed, the Government and the outcome of the white referen- economy remains in the doldrums because of massive dum, the international community becomes more resistance to the new constitutions. This resistance tolerant towards white South Africa, and the leads to escalating repression and violence, and the National Party in particular. business climate worsens. This in turn leads to eco- nomic stagnation and decline, accompanied by a In light of this, the Government hardens its negotia- flight of capital and skills. tion position. At the same time the liberation move- ment is perceived to be too radical and loses support The government also fails to deliver on the social internationally. The liberation movements maintain front. Resistance and unrest render effective social their bottom line. A stand-off results and constitu- spending impossible and large outlays are required tional negotiations break down. merely to maintain the status quo. Because society’s major inequalities are not addressed, the vicious cycle The government decides to form a new “moderate continues. Eventually the various parties are probably alliance” government which is unacceptable to the lib- forced back to the negotiation table, but under worse eration movements. This results in mass resistance social, political, and economic conditions than before. which the State suppresses by force. Possible outcomes of Ostrich include a “Lebanonization” of South Africa, with different Ostrich Scenario warlords controlling various regions; or, eventually, a suc- Non-representative Government cessful insurrection. But these possibilities were given less weight than a return to nego- International community International community “too radical” tolerant tiations under conditions STAND where the downward cycle might have rendered many Liberation movement OFF Government inflexible maintains the bottom line problems insoluble. Negotiations break down Any observer will immediate- “Moderate alliance” government ly recognize elements of this Resistance scenario in South Africa’s
course of events since May D EEPER Repression Negative Economic No social 1992. and violence business climate stagnation delivery N EWS However, Ostrich was pieced The crisis worsens together a mere 10 days after Back to negotiations the overwhelming yes-vote in 11 the white referendum, when most observers were con- vinced an interim government was only months away.
If it had been presented as a possible outcome at that “Political compromises are state, it would probably have been rejected by most needed to arrive at the polit- ical settlement which is a audiences as implausible and inconsistent with the precondition for economic facts. That the team felt Ostrich was still plausible take off. However a settle- points to one of the major advantages of the scenario ment which seriously inca- planning method. Instead of trying to forecast the pacitates the democratic future (usually within a particular ideological para- government will lead to the lame duck.” digm or mindset) the scenario method points to an —Tito Mboweni, ANC evaluation of all significant possibilities even if it requires what might seem to be counter-intuitive thinking.
“There is an urgent need for a comprehensive political settlement and for sustain- able economic policies in South Africa, otherwise we will add South Africa to the already dismal economic development record of Africa.” —Mosebyane Malatsi, PAC EWS N EEPER D
12 The Lame Duck of a Long Transition
The second scenario, Lame Duck, envisages a formal, protracted transi- tion lasting for most of the coming decade. The image is that of a bird with a broken wing. No matter how hard it tries, it cannot get off the ground, and thus has an extremely uncertain future.
Various forces and considerations drive the major par- Such a long transition of enforced coalition is likely ties towards a negotiated settlement. The present gov- to incapacitate government because of the probability ernment, for example, recognizes the necessity or of lowest common denominator decision-making, inevitability of extending full political rights to the resulting in indecisive policies. It purports to respond disenfranchised but fears irresponsible government. to all, but satisfies none. In consequence, the social This fear is shared by some of the major international and economic crisis is inadequately addressed. actors. Even if the transitional government succeeds in being On the other hand, the liberation movements fear the goal-directed and effective, it will still be incapacitated return to repressive minority rule if they do not make because of the logic of a long transition. Uncertainty significant compromises. Such considerations lead to a will grow on the nature of the government to emerge transitional arrangement with a variety of sunset after the transition. Regardless of how moderate the clauses, slowly phasing out elements of the present declarations of the majority parties in the coalition system, as well as minority vetoes and other checks may be, fears of radical economic policies after the and balances aimed at preventing “irresponsible” gov- period of long transition will remain. Investors will ernment. hold back, and there will be insufficient growth and development.
Ironically, the unintended consequence of a long transi- Lame Duck Scenario tion is to create uncertainty rather than to enhance confi- Long transition dence in the future. · Political settlement · All party coalition · Sunset clauses Lowest common denominator decision-making · Indecisive policies · Purports to respond to all, satisfies none
Uncertantity because of long transition Investors hold back D Social crisis EEPER Insufficient
inadequately N growth addressed EWS
13 The vicious circle of political, economic and social crises worsens Icarus: A Myth with a Message
The third scenario is one of macro-economic populism. The team called it Icarus, after the Greek mythical figure. This is the scenario of a popularly elected democratic government which tries to achieve too much too quickly. It has noble origins and good intentions but
pays insufficient attention to economic forces.
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dcdcdcdcdcdcdc dcdcdcdcdcd dcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdcdcedcdc
dcdcdddcdcdcdc dcdcdddcdcd dcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdcdcdddcdc
dcdcfdcdcdc dcdcfdcd dcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdc dcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdcdcfdc
dcdddddddcdddc dcdddddddcd dddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddc
dchdce dchd
dddddddddddddd ddddddddddd dddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd
dcdcdcdcdcd carus was the son of Daedalus, an Athenian crafts- dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd
dcdcgd man of noble ancestry, renowned for his ingenuity. dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd
dcdddddcdcd King Minos of Crete asked Daedalus to build a dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd
dcdcdddddcd I
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd
dcdcdcedcd Labyrinth from which no exit could be found. When dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd
dcdddddddcd their friendship turned to enmity, King Minos impris- dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd
dcdcedcdcd oned Daedalus and Icarus in the Labyrinth. Hoping to dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd
dcdcdddddcd escape, Daedalus crafted two pairs of feathered wings dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd
dcgdcd and he attached them to their shoulders with wax. dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd
dcdcdcdcdcd Daedalus warned his son not to fly too close to the sun, dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd
dcdcgd but Icarus, exhilarated by his flight to freedom, flew
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd
dcdddddcdcd higher and higher. The wax melted and he plummeted
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd
dcdcdcedcd to his death into the sea.
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dcdddddcdcd dcdddddcdcd
dcdcedcdcd dcdcedcdcd
dcdcdcdcdcd dcdcdcdcdcd
dcdcdcedcd dcdcdcedcd
dcdcdddddcd dcdcdddddcd
dcdcgd dcdcgd
dcdddddddcd dcdddddddcd
dcgdcd dcgdcd
dddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddd dddddddddddddd ddddddddddd
cdhcd dchd
cdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcdddddddcddddddd cdddcdddddddcd dcdddddddcd
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Fly Now, Crash Later crisis of hitherto unknown proportions which results in social collapse and political chaos. The government embarks on a massive spending spree to meet all the backlogs inherited from the past. It Either the government does a 180-degree about-turn implements food subsidies, price and exchange con- (while appealing to the International Monetary Fund trols, and institutes other “quick fix” policies. and the World Bank for assistance) or it is removed from office. The likely result is a return to authoritari- The initial results are spectacular growth, increased anism and an abandonment of the noble intentions living standards, improved social conditions, little or that originally prevailed. no increase in inflation, and increased political sup- port. Perhaps the most sobering aspect of this scenario of spectacular boom and bust is that the very people But after a year or two the program runs into bud- who were supposed to benefit from the program end EWS
N getary, monetary, and balance of payments con- up being worse off than before. straints. The budget deficit well exceeds 10 percent. EEPER
D Depreciations, inflation, economic uncertainty, and As in the case of Lame Duck, the Icarus (fly now, crash collapse follow. The country experiences an economic later) scenario is bedeviled by unintended conse- 14 quences. The government’s inten- tion is to provide rapidly for the Icarus Scenario social and economic needs of the people. However, because macro- economic discipline is not main- tained, this strategy leads to eco- Macro-economic populism (fly now, crash later) nomic collapse, and in the end the government is able to give far less social support than would Capacity constraints and imbalances have been possible had it not attempted to fly so high so fast.
As in the case of many Latin Massive social Economic and spending spree social collapse American countries, it is quite possible that some form of authoritarian regime could emerge from this conflict. Right- wing armies often stage coups Popular Some form of government authoritarian rule? under such conditions, claiming a need to restore law and order. The democratic government itself could become more authoritarian once its ability to buy support through populist policies is eroded, or it could be The steeper the initial artificial growth spurt, the replaced at the next election by a more conservative steeper the eventual economic collapse seems to be. government. The group did not attempt to predict Inflation skyrockets to as much as 100 percent a the composition of the government which would fol- month. low in the wake of Icarus policies, except to speculate that it will be authoritarian.
Icarus Crashes When governments spend more money than they receive, huge deficits induce an exhilarating spurt of high economic growth.
This artificially-induced growth rate is not sustainable. More goods are demanded than are produced and more imports are bought than the country can afford Learning from Nicaragua to pay for out of the money earned by exports. Progressive regimes often try too enthusiastically to Price controls and strict foreign exchange controls, change everything overnight. brought into being to put a lid on these pressures, fail. D
Soon prices explode, the value of the currency falls Quite aside from macro-economic problems, they EEPER dramatically, and the economy slumps. attempt more than they can accomplish. N EWS The most dramatic illustration of the catastrophic consequences of such populist macro-economic poli- cies are provided by some Latin American countries. 15 In an interview in 1986, Dora Maria Tellez, Minister of Health in the Sandinista government, admitted the Nicaraguan government had tried to move too fast.
“Perhaps our greatest error, if it can be called an error...is that we believed we could do more than was possible in this period...We thought we could build more hospitals and schools than we have built, and pro- duce more than we have produced.
“There was a little romanticism... Later we realized that things take time, and that in a country which has been squeezed for decades like Nicaragua, you cannot fix everything in seven years.”
Michael Manley, former Jamaican president, com- mented:
“There are a lot of things we see much more clearly now. Number one, in determining how much you can try to accomplish, you just have to look at what your capacity is, your managerial capacity, your capacity to organize. And we were frankly over- enthusiastic. We just tried to do too many things and we stretched the whole system further than it could go.” EWS N EEPER D
16 The Flight of the Flamingos
This is the scenario of inclusive democracy and growth. Flamingos characteristically take off slowly, fly high, and fly together.
A decisive political settlement, followed by good gov- It makes well-targeted social ernment, creates conditions in which an initially slow investments which lead to a but sustainable economic and social take-off becomes decrease in violence and give possible. The key to the government’s success is its people confidence that many of the social needs will ability to combine strategies that lead to significant be met in the longer term. improvements in social delivery with policies that cre- ate confidence in the economy. Once business is convinced that policies will remain consistent in the years ahead, investment grows and Access to world markets and relative regional stability employment increases. Initially this growth is slow, facilitates the flamingos, but South Africa does not because confidence does not return overnight, but receive massive overseas investments or aid on the over the years higher rates of growth are attained, and scale of a Marshall Plan. an average rate of growth of close to five percent is realized over the period. The government adopts sound social and economic policies and observes macro-economic constraints. It The overall income of the upper income groups grows succeeds in curbing corruption in government and between one and three percent a year, and that of the raises efficiency levels. poorer classes by an average of between six and nine percent a year, mainly because of the increase in for- mal sector employment.
Although the growth rates are slower at the outset than that of Icarus, the Flamingos soon Flight of the Flamingos deliver more.
From the outset processes are Inclusive Democracy and Growth developed which facilitate Political Settlement Facilitating international broad participation. These environment processes create the condi- · Regional stability tions under which it is possi- · Access to world markets ble to find a sound balance Good government between social reconstruction · Clear and consistent policies and sustained economic · Efficient not corrupt · Observes macro-economic constraints growth. In spite of conflict between different groups and classes there is substantial Broad participation agreement on broad objec- D
· People have a say EEPER tives. N EWS Social reconstruction Sustained economic growth The team agreed to differ on · More social investment · Business is confident the ultimate destiny of Flight · Decrease in violence · Investment is high of the Flamingos. Some · Employment increases 17 believed it would pave the way for a more radically It was generally agreed that more efficient delivery sys- left-wing program; others saw it creating conditions tems would be the cornerstone of increasingly effec- for a more radically free market economy. Others tive service provision. It would enable a government believed that Flight of the Flamingos could prove to be to deliver more at the same cost to the treasury. so successful that South Africans may choose not to Further funding for social investments would have to deviate from it. be provided by economic growth and redistribution.
Necessary Conditions for Take-off Some members of the team accepted that, given the history of apartheid, some degree of redistribution was There are a number of necessary in order to different blueprints, some equalize social spending of a more conservative “The Flamingo scenario sketches the on whites and blacks, but and some of a more radi- bare bones of a successful national in the longer run they cal nature, that could democratic project of the kind that is favored free market-ori- feasible under prevailing conditions in potentially realize Flight of South Africa. The gains implied under ented policies. Other the Flamingos. The team this scenario—redistributive programs members of the team did not attempt to devel- and some empowerment and involve- favored more radical op its own blueprint, but ment of working people in decision forms of redistribution. considered the necessary making—could incrementally change the balance of forces in society and conditions that need to thus create favorable conditions for the It is obvious that the be met in the political, kind of broader and deeper transfor- curbing of violence, bet- economic, and social mations socialists would favor. There is ter training and schooling spheres by all the poten- by now enough experience worldwide and, in particular, better tially successful blue- which points to the need to take seri- primary schools, as well ously the lessons implied by the other prints. scenarios.” as increases in public —Rob Davies, UWC health and nutrition are A culture of justice, a basic elements of a break from authoritarian- restructured social sys- ism, a bill of rights, and proportional representation tem. The empowerment of women is a prerequisite were seen as the necessary elements of the political for dealing with social problems such as rapid popula- system. In addition, it was agreed that effective partic- tion growth, educational reconstruction, and the ipation is a basic element, but the group disagreed on spread of AIDS. how this was to be brought about. Some favored the Swiss referendum system. Others saw tripartite negoti- Flamingos Don’t Always Have a Smooth Flight ating forums as an essential element. Five general points about Flamingos need emphasis. Although a market-oriented economy (not a free market economy) was accepted as a necessary condi- • The scenario is not a blueprint. In fact, while tion during the next decade, more radical members team members generally agreed on the saw this as a means of keeping the socialist project broad conditions required for success, they alive in the longer term. differed substantially on the detail.
Monetary and fiscal discipline is a prerequisite for suc- • The team recognized that it would be utopi- cessful economic development. an to expect all the necessary conditions to EWS
N be fully met. Rather, the team believed that Foreign exchange earnings must also be increased by the outcome would depend on the degree of
EEPER growth in exports and in tourism. progress towards meeting the conditions. D
18 18 • The third point, therefore, is that the future is not predetermined. It can be shaped by the decisions and actions of the major play- ers.
• The team was fully aware that various groups (such as the right wing, alienated youth, a cor- rupt bureaucracy, trade unions, and disinvest- “While it is impossible to ing businessmen) each have the power to pre- meet all people’s demands vent the flock from becoming airborne. immediately, once people are convinced that there is light at the end of the tunnel, their • Finally, it should be emphasized that even demands become tempered the most positive outcome is not a smooth with reason.” flight. —Vincent Maphai, UWC
“South Africa can attain a decisive politi- Malaysian economy varied from 5.2 per- cal settlement and an economic take-off, cent to 8.3 percent. This was attained in once all significant groups realize that we spite of the fact that Malaysia, at the start will either fly together or crash together. of the period, was also a primary goods Although many of the recent internation- exporter. In addition, there were severe al examples of economic success were tensions between the Chinese, who dom- realized under conditions of political inated the economy, and the indigenous suppression, there are a number of cases population. Political compromise and where political compromise has led to economic restructuring have led to a dra- socio-economic success. The most inter- matic increase in the indigenous popula- esting amongst these are Sweden and tions share in the economy, to a more Malaysia. than six-fold increase of real incomes of all, and to Malaysia developing into a “From 1920–1970, Sweden (which start- major exporter of high-tech manufac- ed with a per capita income and unem- tured goods. ployment rates similar to those of pre- sent-day South Africa) experienced eco- “South Africa will clearly have to find its nomic growth second only to Japan. The own route. The point is, though, that the socio-economic transformation wrought history of these countries teaches us that in Sweden during this period is hitherto a political settlement born from compro- unparalleled. mise combined with the correct econom- ic and social policies could potentially “During each of the past three decades succeed. “ the average annual rate of growth of the —Pieter le Roux, UWC D EEPER N EWS
19 20
DEEPER NEWS Borderline Questions land usintheIcarus scenario? and step thelevelneededforsocialreconstruction Lame Duck ed forthe tobringaboutthepoliticalsettlementneed- necessary answer. Which compromisesandsunsetclausesare Two difficultto questionsareparticularly boundary the other, maybequiteblurred. Duck The boundariesbetween on theonehand,and Flamingo ? Secondly, whenwillsocialspendingover- scenario, andwhichwillentrench Flight ofFlamingos Flamingos and Icarus and Lame on policies willfavor al stipulationsthatleadtoindecisive andincoherent Africa ontoanewgrowth path.Similarly, constitution- government formostofthedecadewillnotgetSouth long theuncertaintyofnature ofthepost-transition mises are notmade.However, sunsetclausesthatpro- No politicalsettlementwillemergeifcertaincompro- my cansustainsuchpolicieswillleadto attempts aremadetodeliverfarmore thantheecono- However,significant socialreconstruction. when The crashes disastrously. is notclearhow farSouth Africacouldgobeforeit depends onthespecificcircumstancesofacountry. It level ofbudgetdeficitssustainableover thelongrun Flight oftheFlamingos Lame Duck cannot takeoffwithout . Icarus . The EEPER EWS
D N 21 PAC economist; senior policy analyst at economist; senior PAC Africa of Southern Bank the Development and Strategic in the Center of Policy Analysis for planning at the Institute social Teaches of the University at Development Social Cape Western Executive of the National Member of Working Committee and the National of the ANC’s the ANC Committee; Head department of economic planning and head of the Associate professor department of political studies, University Cape Western of the and head of the of economics Professor of economics department, University Africa South and dean of the faculty Associate professor at of economic and management sciences Cape Western of the the University of at the University fellow research Senior consultant in and research Town Cape of the economics at the University Cape Western of the Eastern Cape Director in Forum and Funding Development secretary (Eastern regional Grahamstown; and member of the Cape Region) Committee of the Executive National ANC MOSEBYANE MALATSI MOSEBYANE MANGWANA THOBEKA CIKIZWA TREVOR MANUEL VINCENT THABANE MAPHAI PHILIP MOHR NICKY MORGAN NCUBE PATRICK GUGILE NKWINTI Administrative coordinator for Mont coordinator Administrative Scenarios Fleur of the and co-director professor Research at the African Studies Center for Southern Cape Western of the University Stiftung; Ebert officer at Friedrich Project with N.U.M. previously A world expert in scenario-based strategic planning of social, political, communica- Manager in tions, and media department of Shell Cape Town Company of Distillers director Managing in Stellenbosch studies and direc- in development Professor Development, for Social tor of the Institute Cape Western of the University relations, external general manager, Senior of the Chamber of Mines Executive of the National Member of the Committee of the ANC; Head of media liaison unit of the Department of the ANC and Publicity Information in the departmentEconomist of economic planning of the ANC and presently of FABCOS Ex-director Group chairman of Inter-Africa DOROTHY BOESAK DOROTHY ROB DAVIES GABRIELS HOWARD KAHANE ADAM KALYAN KOOSUM MICHIEL LE ROUX PIETER LE ROUX JOHANN LIEBENBERG SAKI MACOZOMA MBOWENI TITO MAGOMOLA GABY Those Who Took Part Who Took Those BRIAN O’CONNELL SUE VAN DER MERWE Director of the Peninsula Technikon Member of the Black Sash National School of Education in Cape Town Executive Committee
MAHLOMOLA SKOSANA DR. WINFRIED VEIT First assistant secretary general of Director of the South African office of the NACTU Friedrich Ebert Stiftung (FES) in Cape Town VIVIENE TAYLOR Director of the Southern African CHRISTO WIESE Development Education Program Member of the Economic Advisory (SADEP) at the University of the Western Council of the President; executive chair- Cape man of Pepkor
Acknowledgments
With grateful thanks to the following:
The Friedrich Ebert Stiftung for funding the exercise Swiss Development Agency for funding support Adam Kahane for facilitating the process Shell South Africa for technical support with view graphs
GBN would like to thank
Pieter le Roux for permission to reprint the “Mont Fleur Scenarios” as a DEEPER NEWS EWS N EEPER D
22 GLOBAL
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