Money from Nothing: Indebtedness and Aspiration in South Africa - Softcover

James, Deborah

Softcover

ISBN 10: 0804792674 ISBN 13: 9780804792677

Publisher: Stanford University Press, 2014

Synopsis

Money from Nothing explores the dynamics surrounding South Africa's national project of financial inclusion―dubbed "banking the unbanked"―which aimed to extend credit to black South Africans as a critical aspect of broad-based economic enfranchisement.

Through rich and captivating accounts, Deborah James reveals the varied ways in which middle- and working-class South Africans' access to credit is intimately bound up with identity, status-making, and aspirations of upward mobility. She draws out the deeply precarious nature of both the aspirations and the economic relations of debt which sustain her subjects, revealing the shadowy side of indebtedness and its potential to produce new forms of oppression and disenfranchisement in place of older ones. Money from Nothing uniquely captures the lived experience of indebtedness for those many millions who attempt to improve their positions (or merely sustain existing livelihoods) in emerging economies.

About this title

About the Author

Deborah James is Professor of Anthropology at the London School of Economics. Her previous books include Gaining Ground? "Rights" and "Property" in South African Land Reform (2007) and Songs of the Women Migrants (1999). She has written for the Mail and Guardian and has appeared in Laurie Taylor's Thinking Allowed, on the BBC.

Excerpt. © Reprinted by permission. All rights reserved.

Money from Nothing

Indebtedness and Aspiration in South Africa

By Deborah James

STANFORD UNIVERSITY PRESS

Copyright © 2015 Board of Trustees of the Leland Stanford Junior University
All rights reserved.

ISBN: 978-0-8047-9267-7

Contents

List of Illustrations, 
Acknowledgments, 
Abbreviations, 
Non-English Words and Phrases, 
A Note on Currency, 
Introduction: The Wellsprings of Consumption and Debt in South Africa, 
1. Indebtedness, Consumption, and Marriage: The New Middle Class, 
2. Regulating Credit: Tackling the Redistributiveness of Neoliberalism, 
3. "Ride the Camel": Borrowing and Lending in Context, 
4. "You Don't Keep Money All the Time": Savings Clubs and Social Mobility, 
5. South Africa's Credit Crunch: Narratives and Neighborhoods, 
6. "The History of That House Keeps You Out": Property and the New Entrepreneur, 
7. New Subjectivities: Advice, Aspiration, and Prosperity, 
Conclusion, 
Notes, 
Bibliography, 
Index, 

CHAPTER 1

Indebtedness, Consumption, and Marriage

The New Middle Class

THERE IS A UNIVERSALLY held position, says Gustav Peebles, that "debt is bad, but credit is good" (Peebles 2010, 226; see also Gregory 2012). The present chapter aims to unsettle that assumption, and in the process it simultaneously explores—and challenges—other kinds of oppositions. Aligned with the alarmist perspective that views debt as a measure of social stress and unsustainability are claims about the dissolution of the social fabric and the "crisis of social reproduction" in South Africa (Comaroff and Comaroff 2001; Fakier and Cock 2007; McNeill 2011). This view highlights how normative relations, including and especially those between genders within the household, have been breached: neoliberal policy agendas have undermined men's masculinity by making jobs scarcer; household economies that were once supported by men and managed by "stay-at-home" wives have collapsed. For the unlucky majority, unemployment is prevalent, with its effects only minimally compensated for through extensive state welfare. The lucky few, in contrast, are seen as engaging in excessively opulent lifestyles. The former envy the latter because of their public displays of capitalist success.

Opposing this dyspeptic view, and aligned with the view that credit has its positive side, are perspectives that emphasize the positive transformation of society (Nuttall 2004; Mbembe 2004). Borrowing can provide the means to reframe one's lifestyle and social identity while also enabling the reconstitution of society at large. In the new postapartheid era, people explore new forms of consumption while also retaining or intensifying a desire for continuity in social, political, and economic process. Strategies labeled "traditional" often entail new social relations or older ones reconfigured: between elders and youths, Christians and traditionalists, mothers and daughters. These arrangements often take as their model, or are embedded within, the quintessentially moral and long-term reciprocal relationship of "good debt": affinity between families as expressed through the ongoing payment of bridewealth in marriage (Scorgie 2004).

Finding a midpoint between these opposing positions, we will see how, on the one hand, ties between families are severed in divorce, or alternatively never initiated because of the extreme expense of bridewealth and the onerous nature of obligations toward in-laws. Yet on the other hand, the entanglements in forms of commitment and webs of long-term obligation that Parker Shipton (2007) calls "entrustment" are acknowledged and pursued, and social investments made, at particular moments in the life course. At the same time, while many decry an orientation toward careless consumption, householders often provide evidence of careful husbandry or take out loans to ensure the future well-being of their families. Neither of these pictures on its own—a dismembered society versus a reconstructed one; the spendthrift consumer versus the frugal householder; the overindebted person versus the borrower aiming to reposition him- or herself—presents a complete and accurate account of the rapidly shifting terrain of relationship, ambition, dependence and ostentatious display in South Africa. But in combination they can tell us something about the social terrain and those who are placed within it.

The New Professionals: Frugal or Fragile?

In the course of my search for those who might be considered representatives of the new middle class, I find myself sitting in the smartly apportioned and airconditioned office of Abigail Mlate, on the fifth floor of an office block in central Pretoria. Our conversation ranges across a variety of topics: her upbringing and education, her family, her plans for her daughter's future. We also talk about the differences between her mother's generation and her own. The daughter of a policeman and a schoolteacher, Abigail was raised in a single-parent family by her mother, who paid for her education in its entirety. The private school she attended, in one of South Africa's former homelands, Bophutatswana, a little way to the north, gave her a good educational grounding and paved the way for her to attend university. For a while she worked in a middle-range job in social welfare, but soon afterward she did a postgraduate degree, and shortly after that she was appointed to a senior position in a government department in Pretoria.

There are several features that distinguish Abigail's story from that of someone who might hold a similar government job in another country. One is the speed of her upward mobility. Compared to the career trajectory of her mother, Abigail's own rise was positively meteoric. As with many young black South Africans in similar circumstances, her elevated position and her swift promotion were in large part due to opportunities forthcoming after the country's apartheid racial order was overturned in 1994. Another thing that distinguishes her position, closely but inversely related to the rapidity of this rise in status, is the fact that several close family members—aunts, nephews, and nieces—share neither her educational qualifications nor her upward trajectory. Her aunts are domestic servants, who are experiencing some difficulty in putting their children through school. She is often asked to provide help (in material and other terms) to these relatives.

But there are also complex threads that tie Abigail's story to longer-standing social arrangements. If there is a shift in class positions evident in this story, it is the one that occurred not in her own life course but in that of the previous generation. The difference between Abigail and her cousins owes itself to her mother's having "pulled herself up" to become a teacher, in contrast to her aunts (and their children), who remained in menial work.

A further striking continuity between the generations can be discerned if one looks at the careers of the spouses of Abigail's mother and Abigail herself. Both marriages linked people of similar social status, but both dissolved quite swiftly. In Abigail's own case, her partner was a university graduate, as she was. One of the key moments of disagreement between them came when he objected to her "wasting money" on her own further education rather than saving it for the education of their daughter. Rather than accepting this line of argument, Abigail saw it as a sign of his unwillingness to accept that his partner might become better educated than he. He could not accept that ultimately she might, as a result of her superior achievements, be unwilling to kowtow. "It's that patriarchal thinking that 'If she gets this master's [degree] then she will be better off than me. And I'm the man here so she will have to listen to what I say,'" as Abigail put it.

The wealth and investment habits of the new black middle class—which Abigail in many ways seems to personify—have been a matter of growing interest to those in the commercial world, and it is worth briefly outlining the reasons for this. The various tags used to typify the group—"black diamonds" (Mda 2009), "coconuts" (Matlwa 2007) and "cheeses" (Skhosana 2012)—emphasize material consumption and lifestyle but also refer to race (Posel 2010). The "black diamond" tag, in particular, was more or less invented by advertising agencies and commercial market research organizations such as the Unilever Institute, inspired by the need to profile—so as better to target—new categories of consumer; and later it was taken up in the media and portrayed in stereotypes on television soap operas. This profiling, originally crude, but increasingly sophisticated, involves the use of ten living standards measures (LSMs), each "defined by a number of criteria, ranging from income and housing type to car and phone ownership" (Chevalier 2010, 79). Where under apartheid the state was the agent responsible for categorizing people so as better to divide and govern them, it is now corporations that pigeonhole people so as better to market goods and services to them. By means of this class and lifestyle profiling, attempts were made to bring more people within the ambit of visibility and to enable them to be reached by advertisers.

While advertisers have tried to separate such people from their money, critics show how the use of such labels is misleading. Discussing the "black diamonds" in Durban, Sophie Chevalier says the emphasis on lifestyle diverts attention from "what is really at stake in society and politics, in this case the persistence of racial stigma and of a behavioral standard based on the white minority" (Chevalier 2010, 84). The argument that members of the newly liberated nation would have done better not to squander money on luxury consumables is addressed by sociologist Deborah Posel (2010). Such critiques, she says, echo those of an earlier, apartheid-era discourse, when being black was closely associated with specific types of food, furniture, crockery, vehicular transport, and the like. Those who aspired to own or consume items normally thought of as "for whites" were greeted with ambivalence: praised for being more civilized but also regarded with suspicion since their behavior amounted to the imitating of their "betters." The unexpected association of political freedom post-1994 with the "freedom to consume" can be understood, she argues, since its opposite, political repression, had meant being excluded from the consumption of anything but bare necessities (Posel 2010, 173).

Within the ranks of those reckoned as "belonging" to the black diamonds (albeit now known by other names), some view the categorization, and similar ones, as having some validity, whereas others view it as invalid because of its lack of attention to social nuance (Krige 2009, 2011). The new reflexivity of those labeled in this manner—and the fact that many have a "voice" as journalists, radio presenters, writers, and commentators—has given them confidence to respond critically, calling attention to the precariousness and lack of economic sustainability that underpins their lifestyle. Members of this putative category are "no-carat diamonds," wrote Jabu Mabuza in the Financial Mail, "nothing more than a glorified consumer group," especially given their lack of material assets and real prospects of advancement through business. Their wealth—such as it is—arises through the state's affirmative action and black empowerment schemes and is soon squandered by the consumption of "luxury goods acquired through debt." Disliking the emphasis on this new class, since it is not their work that in reality underpins the economy, Mabuza states that market surveys of this group are used by industry "to instil a false sense of aggrandizement and achievement in the black diamond market segment" (cited in Krige 2009, 23).

This emphasis on the flimsy material underpinnings of aspiration was reiterated in a more recent altercation in the pages of the Mail and Guardian newspaper. Young hip-hop star Jub Jub, a member of the consumption-oriented middle class whose family had moved out of Soweto to Johannesburg's southern suburbs and later went to the United States, acquired a drug habit that, on the family's return to South Africa, led to his being jailed for killing several youngsters during a misguided drag-racing stunt. Essayist and journalist Bongani Madondo wrote critically about the empty "bling" and excess embraced by those in this upwardly mobile group. Countering Madondo's criticism, a letter to the paper echoed the points made by Mabuza, noted previously: what was really of note in the story was not the "bling" but the "precariousness of African success after apartheid" and the "fragility of new black wealth." That this fragility consists in part of overreliance on credit, in the absence of other alternatives, is suggested by Sophie Chevalier in her study of Durban's "black diamonds." Despite benefiting from bigger (mostly state) salaries, members of this class have few options available to enable them to actualize their access to the wider range of goods that has become accessible to them. They have little in the way of "capital, savings or inheritance to draw on, and must go into debt if they wish to consume on any scale" (Chevalier 2010, 78).

However much the state might have acted to bolster and establish the new middle class, then, and however important the new social meanings of the new forms of consumption engaged in—and the indebtedness entered in to help engage in those meanings—some view its fragility as overweening. From Abigail's story, however, it is clear that her position is neither as precarious nor as oriented toward the flashy and unsustainable expenditure of money, as some media accounts on the topic have suggested. Displaying a self-reflexivity that is characteristic of people in this new position, Abigail has considered opinions on the "new black middle class," of which she acknowledges that she herself could be reckoned a member. Acknowledging the role of state employment, she draws attention to the circumstances that have enabled the rise in her own fortunes, to "the political climate currently, and ... issues around broad-based black economic empowerment programs that government has introduced." But alongside "the political change—the opportunities that are open to us—what we call disadvantaged groups," she also emphasizes the fact that she went to a good school and to university. In short, she recognizes both the dependence of her success on the postapartheid state, which gave her the chance of holding a high-level job, and the much earlier investments in education by the farsighted individual efforts of her mother. As Abigail put it, her mother "had certain expectations ... 'if I put my last money on my two daughters, I know hopefully one day they will become better people.'" In many of my subsequent discussions with people in relatively senior jobs in government or the stateowned enterprises, I find that many of them fit a similar description. It was their parents, pre-1994, who made the educational investment necessary for them to later take up positions as part of the post-1994 dispensation. Intergenerational mobility over the past few decades has been largely determined, and opportunities restricted, by which side of the class division people were originally positioned on (Seekings and Nattrass 2005, 331).

Making clear the robustness and enduring character of intergenerational strategies, Abigail's future plans for her own daughter echo those that her mother had for her; she puts a similar emphasis on judicious expenditure and investment. Repudiating her ex-partner's idea that spending money on her own education would preclude funding that of her daughter, Abigail's strategy encompasses both. She intends to send her daughter "to a good school" and to provide her with higher education. But she also states matters in a more traditionally middle-class vein that balances privilege with due consideration, gratification with necessary delay, and liberal agency with context and structure. She stresses the importance of her daughter's individual "free choice" while also emphasizing the need to educate her daughter about the financial constraints that might narrow that choice:

I explain, and I have noticed that when you talk to her and explain to her—my daughter is not the kind of child that will start crying in a store because she wants all these toys. My cousins are amazed, because I always talk to her. She always knows that when she asks for something she needs to acknowledge the fact that mummy has money, or mummy doesn't have money. And if I do have money, I tell her, "This month I think I can be able to buy you that thing that you want." And through that engagement I have noticed now that she starts to understand that you don't just get things just like that, you plan things. And it really helps, because I'm never frustrated when I go shopping with her. She won't sulk. She must realize that you have to work hard, that you have to have delayed gratification.

Abigail thus points to the importance of taking a measured attitude toward consumption. Further stressing this, she points out that, as a single mother, she often faces pressures to match the expenditure of those who raise their children in couples: "You want to keep up with your friends who have husbands, to say 'I need to show them ... I am adequate, I can take my daughter, I can have the same life they have even though I am a single parent.'"

(Continues...)

Excerpted from Money from Nothing by Deborah James. Copyright © 2015 Board of Trustees of the Leland Stanford Junior University. Excerpted by permission of STANFORD UNIVERSITY PRESS.
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Edition details

• Publisher: Stanford University Press
• Publication date: 2014
• Language: English
• ISBN 10: 0804792674
• ISBN 13: 9780804792677
• Binding: Paperback
• Edition number: 1
• Number of pages: 304