This is an edited version of Chapter 8 of South Africa’s Impending Socialist Revolution, published in 1982 by the Marxist Workers Tendency. It has been edited to present a concise summary of the roots of the apartheid regime in the historical development of South African capitalism.

South African capitalism has never been able to provide for the basic needs of the working people. By the time that the bourgeoisie had established itself in South Africa, capitalism already existed as a world system and was already entering its highest, convulsive stage of wars and revolutions: the epoch of imperialism. The world market was already under the domination of monopoly capital, and was in the process of being carved up and recarved in the competition between the imperialist powers.

Then and since, there has been no possibility in South Africa of the development of an autonomous ‘national economy’. This is true of all capitalist countries in the epoch of imperialism. With the development of monopoly capitalism, the whole world economy fell under the domination of the main industrial powers.

To accumulate wealth, the SA capitalist class has always been compelled to buy, produce and sell commodities on the terms laid down in the world market – terms over which it could have little influence. The possibilities for the development of capitalism in South Africa have been shaped within these limits.

The capitalists were fortunate that South Africa possessed natural resources – gold and diamonds – which have given them special access to the world market. But the mining of gold and diamonds could create only a limited base for capitalist development. More and more in the modern world, economic progress has come to rest on diversified industrial production, on the manufacture of an increasing range and volume of commodities.

Each section of the capitalist class internationally must compete on the world market in order to increase, or even maintain, its sale of manufactured products. To compete effectively on the world market has increasingly required economies of scale – that is to say, huge concentrations of investment, using the most advanced machinery and technique, to produce goods as cheaply as possible for mass markets. On this basis, the giant monopolies of the imperialist countries have come to dominate not just their own home markets, but the world market as a whole.

The present-day society in South Africa has developed entirely in the shadow of international monopoly capitalism. South Africa’s dependence on the world market is shown in the fact that its foreign trade (which is largely with the major capitalist countries) has for several decades amounted to one-third or more of total production – among the highest ratios in the world.

While South Africa is today an industrialised country, in its relations with world capitalism it retains many of the features of the under-developed countries. Overwhelmingly, its imports consist of industrial products, in particular machinery and other capital goods. Exports, on the other hand, consist overwhelmingly of mineral or agricultural products – raw materials or semi-processed materials. Throughout the 1970s, gold alone has contributed more than a third of the value of export sales. In 1980, all minerals and mineral products accounted for roughly three-quarters.

South Africa’s industrial development has only been accomplished by the bourgeoisie on the twin pillars of cheap labour and state intervention in the economy.

Like all the weaker sections of the capitalist class internationally, the SA bourgeoisie has been unable to achieve the economies of scale needed to compete with the imperialist monopolies in manufacturing. To establish even a foothold in the market for manufactured products, they have had to seek other means of cutting their costs. In particular, wherever possible, they have savagely held down the wages of the workers.

Even to develop gold-mining on a profitable basis, the capitalists in SA from the start condemned the majority of mineworkers – the blacks – to conditions of poverty and inhuman exploitation. It took the mighty struggles of the mineworkers and large-scale withdrawals of labour in 1974-1975 to achieve any appreciable increase in real wages – and then against the background of a sharp rise in the world price of gold. Similar pressures on profitability have governed the development of manufacturing industry, with the capitalists holding the wages of the workers to bare survival.


From an early stage the state intervened to protect the development of capitalist industry. By imposing tariffs against some cheap imported commodities, it has assisted the local bourgeoisie to sell their higher-priced products on the domestic market. Light industry, in particular the consumer goods industry (e.g. textiles) has been protected in this way since the 1920s.

Capitalist farming, too, has been developed on the basis of state protection, especially by means of subsidies, price fixing and negotiated export markets.

In areas vital to the growth of industry, such as electricity and iron and steel, the enormous outlays required made it impossible for the capitalists themselves to undertake the necessary investment. Already private ownership and private profit stood in contradiction to economic progress. Thus the capitalist state intervened to build the transportation network and to construct ESCOM and ISCOR, and later SASOL (for oil-from-coal), FOSCOR (for chemical production) and ARMSCOR (for military hardware and munitions). Today the state is the largest single investor and employer. 57% of plant and machinery etc. is under its control.

On these foundations of cheap labour and state intervention, capitalist production has undergone enormous expansion. But far from freeing South Africa from imperialism, this very development has locked the SA capitalist class all the more tightly into the imperialist network.


Despite all the endeavours of the South African bourgeoisie to establish their ‘economic independence’ (one of the principal goals of Afrikaner nationalism in the past), economic growth in fact has resulted only in the closer integration of the national economy with the world economy, subjecting it all the more directly to the upswings and downswings of world capitalism.

Industrial growth in South Africa – as in all the younger and weaker countries – has required the importation of ever-larger volumes of sophisticated machinery. South Africa imports 90% of the machinery needed for production. But these imports, of course, must be paid for or financed. Relative to imports, South Africa’s exports have generally grown more slowly. At the same time the prices of raw materials have tended to lag behind those of manufactured goods, subjecting South Africa to similar inequalities in the terms of trade to those experienced by the whole of the ex-colonial world.

Thus, while South Africa’s exports increased four times in value in the boom period between 1960 and 1975, imports increase six times over the same period. To compensate for the imbalance, the economy has fallen chronically into debt to the major imperialist countries.

The expansion of production in South Africa has gone hand in hand with the growth of an interlocking partnership in the ownership of the means of production between the imperialist investors and the SA bourgeoisie – English speaking and, to an increasing extent, Afrikaans-speaking as well. The concentration of capital into fewer and fewer hands has proceeded apace.

Almost from the outset, mining fell under the control of huge monopolies, especially the De Beers company and, later, the Anglo-American Corporation (which later merged together). In time, with the development of manufacturing, the monopolies moved in there as well to take control of the most profitable opportunities.

Of the top 100 industrial and commercial companies, one-third are controlled by only six monopoly groups. The Anglo-American Corporation alone controls over 600 companies involved in virtually every sector of production.


Especially since the 1960s foreign investment has poured into the country, its total rising from R3,109 million in 1964 to R22,886 million in 1979. Aided by the banks and finance houses, bigger SA companies gobble up their smaller rivals and enter partnerships with foreign investors. Even agriculture falls increasingly under the domination of big corporations.

More and more, the biggest SA monopolies – Anglo-American, Barlow-Rand, Rembrandt, for example – take on the character of multi-nationals, venturing out from their base in the SA nation-state to seek profitable avenues for exploitation around the world.

The tendency towards greater concentration and greater integration of the productive forces within each country and beyond national borders is inherent in economic development itself. It is because of the capitalist basis of the system that development turns into a crushing burden on the backs of the working people.

Unless capitalism is overthrown, there can be no escape from the stranglehold of imperialism and monopoly capitalism.

The very growth of capitalism has stored up huge contradictions in the economy, which are now becoming acute. The need of the bourgeoisie to maintain the system of cheap labour has placed narrow limits on the home market for products which the bourgeoisie needs to sell. What workers are not paid they cannot spend! The expansion of production thus runs up all the more quickly against the confines of the nation-state, and adds to the importance of the export market for the capitalists.

The regime’s policy of ‘import substitution’ has largely exhausted its effectiveness. This has been an attempt to stimulate SA industry by barring the import of certain consumer goods and light component parts, and requiring a rising proportion of ‘local content’ in manufacturing. This has had some effect, particularly in developing motor vehicle production. But the SA market has proved too limited for import substitution to be carried forward profitably in crucial spheres of machine production, electronics and other sophisticated goods which are of growing importance for economic development.

The economies of scale necessary to make production even remotely competitive in these fields, require a vast and expanding market – something which neither South Africa nor the impoverished Southern African region as a whole possesses. Thus even the rise of South Africa as a minor imperialist power, dominating the sub-continent, has not released the SA bourgeoisie from the pressures of world capitalism. They are forced to scramble out beyond their so-called ‘natural market’ in Southern Africa – where they also face growing competition from stronger imperialists – and swim for their lives in the shark-infested waters of the world market.

Even during the period of the post-war boom, when the world market was expanding rapidly, the SA capitalists could succeed in gaining only a limited foothold for their manufacturing exports. Now, as the world market stagnates in the developing crisis of capitalism, and as competition intensifies between the major powers, the future prospects for the development of SA industry on a capitalist basis grow dim.

This will be the case under and government in future – white or black – that remains on a capitalist basis.

The migrant labour system – bedrock of capitalism

From the beginnings of capitalist development in South Africa to the present, the migrant labour system has been the bedrock of wage slavery.

This system came into existence in the course of colonial conquest, and was based on the ‘native reserves’ into which the remnants of the dispossessed tribes were driven and confined. The colonial rulers had shattered the foundations of the tribal economy, but discovered they still needed the institutions of the tribe in order to perpetuate their social control.

An army of occupation is too expensive a means for a ruling class to maintain its power in the longer term. Yet the white settler population alone, still raw, unruly and divided within itself on class and national lines, provided at first too weak an instrument for the sure dictatorship of capital over the indigenous people.

So the mine-owners looked to the countryside to find a pillar for their rule. Having started to separate the African people from their land – thus creating a potential proletariat of mass proportions – the bourgeoisie did not want a large-scale immigration to the new towns. Instead, they wanted a system of drawing black labour to the centres (primarily to the mines) under the strictest regulation. This was the origin of the present migrant labour system.

Originally the migrant labour system was useful to the capitalists also for economic reasons – as a means of compelling the family of the worker to toil on the land in order to supplement sub-starvation wages. But above all its purpose had been political – as a method of social control; as a mechanism for maintaining the ‘tribe’ which could not, of course, be maintained in the township.

The reserve system was not devised by the ruling class as a means of livelihood for the African people – of that matter they have always show the most callous disregard. The purpose of the reserves has been to house labour, and to govern it under a ‘tribal’ structure dictated and financed by Pretoria. The so-called ‘tribal’ populations of the reserves have survived not by tribal production but by the wages of migrant labour.

Willy-nilly, however, capitalist development concentrates the working class in large-scale production in the towns. Capitalism in South Africa has proved to be no exception.


Official statistics concede that the percentage of Africans living in the towns doubled from 17% in 1936 to 33% in 1970. Despite 12,5 million pass arrests in the last 30 years, and all the other vicious measures of the regime to halt African urbanisation and confine workers’ families to the reserves, researchers estimate that about 50% are now living in the urban areas.

In the process of growth, capitalism has sucked into the cities workers from all over Southern Africa – at one time from as far afield as Tanzania and Angola.

Vast concentrations of workers are congregated in the main industrial centres of the Witwatersrand, Durban-Pinetown, Port Elizabeth, East London and Cape Town. Thus capitalism has brought into being the grave-digger of the system, which the bourgeoisie has always feared.

Nevertheless, the migrant labour system continues to serve the capitalist as their most vital instrument in the oppression of the African working class. From the pass laws written by the Chamber of Mines for the Kruger government in 1894, to the ‘Wiehahn-Riekert’ strategy of the regime today, the method of the ruling class has not altered in its essentials: the mass of the black workers in the cities must remain ‘temporary sojourners’, present only so long as they are needed to supply their labour power.

A working class entrenched in the cities can more easily create the stable organisations – trade union and political – needed to struggle against its exploitation and oppression. The mass of the African workers in South Africa have to build their organisations against the enormous obstacles of the pass laws and migrant labour. Militant workers’ leaders are regularly banished to remote country districts; workers on strike are ‘endorsed out’ of the towns and forcibly deported to the reserves in their thousands.


The separation of the worker from the family, and the confinement of the latter in the reserves, reduces the pressure on the capitalist class to concede housing, amenities and welfare for the aged, the sick and the unemployed. Barrack accommodation and compounds, long hours of overtime work, hazardous conditions of health and safety, and perpetual insecurity of employment – these are the consequences of the system for the migrant workers themselves.

At the same time, the extreme exploitation and oppression of migrant labour undermines the organising power and the bargaining power of the whole of the black working class. It provides the basis for cheap labour in the entire economy.

The migrant labour system is the central pillar in the national oppression of the black people, enormously strengthening the hand of the ruling class against the struggle of the masses for industrial and political rights.


The struggles of the migrant workers have long disproved the claims that they are ‘peasants’ or ‘peasant-workers’. Yet these terms remain the intellectual currency of the ANC and CP leadership (and also of the Unity Movement fragments which falsely claim the heritage of Trotsky).

This shows a failure to understand that the basis of tribal and peasant agriculture has been destroyed in South Africa and can never be restored. Consciousness has a certain life of its own and can linger long after its objective basis has been removed. But the consciousness of the migrant workers has been melted and recast over and over again in the course of the most militant class struggles, in which the classic weapon of the working class – strike action – has been prominently to the fore.

At the same time, on the land, within the confines of the reserves, the institutions of ‘tribal’ government have been thoroughly exposed as part and parcel of the system of national oppression. With the chiefs transformed from leaders, advisors and representatives of the rural communities into paid puppets and police agents of the oppressor, the people have turned massively to outright opposition to their authority.

From the 1940s onwards, the general struggle of the people against the chiefs signalled the historic change which had come about in the consciousness of the population in the reserves. The Pondoland uprising at the outset of the 1960s marked not the beginning but a dramatic climax of this struggle.

The self-organisation of the people separately from the ‘tribal’ councils, and the decision systematically to eliminate the chiefs, showed that the tribal shell could never again be filled with living content. The task, as the emerging rural proletariat recognised, was to unite with the workers’ movement in the towns. Common organisations of the settled and migrant workers were – and are – essential.

Yet, in 1963, Congress leaders were still mistakenly calling for the formation of separate ‘peasant committees of migrant workers in the towns’! Unfortunately, despite all the development that has taken place since then, this approach has never been corrected.

Instead the conception of a mass ‘peasantry’ is defended, especially by the CP leaders, in an attempt to justify a ‘two stages’ approach to the South African revolution. But in fact, as explained in previous chapters, even the existence of a large peasantry would in no way justify the theory of stages.

Capitalist power and ‘white minority rule’

Full equality and an end to all race discrimination, freedom of movement, the right to meet and organise freely in trade unions, the right to elect the government – these are the immediate democratic aims for which the oppressed people are fighting.

For the working people, these rights are not ends in themselves but means for defending and advancing their material conditions of life. In capitalist society a democratic system of government can endure while the capitalist class is able to stabilise its rule by conceding tolerable living conditions and material improvements to the working class. When the workers’ basic demands cannot be met, even previously ‘democratic’ capitalists reveal themselves as hostile to democracy.

In South Africa, as we have shown, capitalism depends of necessity on the system of cheap labour. The inability of the capitalist class in South Africa to concede material improvements to the workers beyond the most narrow limits has meant, correspondingly, the inability of capitalism to afford concessions in the sphere of democratic reforms.

Thus every struggle of the ever-growing working class, even for the smallest advances, has brought it directly up against the repressive machinery of the state – against the police, the state officials and the army. The reliance of the bosses on naked dictatorship against the workers is brought home daily in the class struggle.

Over the decades, the preservation of capitalist profits and capitalist rule has required the constant strengthening, refining and expansion of the repressive machinery of the state. The rapid development of the economy during the 1960s which brought with it the massive growth of the working class, found its necessary counterpart in the cancerous growth of bureaucratic and police tyranny, and in the new barbaric nightmares devised by the Special Branch in the torture chambers of the prisons.

Over generations capitalism has proved to be the enemy of democracy in South Africa, and remains so.

All along, the bourgeoisie in South Africa has been too weak to maintain its dictatorship by its own resources alone. Indeed, without the armed assistance of imperialism, the SA bourgeoisie would have been unable even to create a unified state for itself.


The Union of South Africa, which it inherited in 1910, was a state largely fashioned by British imperialism, and resting on imperialist support. Despite all the beatings of the drums of ‘national independence’ by sections of the SA bourgeoisie, their state remains today dependent in critical respects on reinforcement by world capitalism.

Even today, the claims of the ruling class to ‘independent’ arms production or to the ‘independent’ development of nuclear power fail to conceal its continuing military and technical reliance on the major Western powers. And equally apparent is the continuing political support which imperialist governments provide for the South African capitalist state.

But, in contrast with those colonies where there was very little economic development, support from beyond the borders of South Africa has been an insufficient basis for the ruling class to construct and stabilise its dictatorship over the rising working class. Capitalism has been compelled to seek a social footrest within the population of South Africa itself.

Over the generations, the bourgeoisie has cultivated the support of the white middle class and the white labour aristocracy against the black workers, setting the whites apart and granting them privileges and an elevated status over the black people. In this way the capitalist dictatorship in South Africa became consolidated as the system of apartheid – of national oppression and white privilege.

The raw material for the system of national oppression lay in the old colonial situation itself – in the conquest of the indigenous people; in the existence of a white settler community on the land and in the towns; in differences of culture and language; in the importation of skilled whites earning wages many times the wages of the unskilled blacks.

But this raw material of prejudice and privilege was systematically moulded and developed by the capitalist class and its successive governments. The divisions within society were deliberately hardened and deepened so as to bring into being the modern apartheid system with all its savage refinements. In the process the emerging black middle class also was subjected to many of the burdens and humiliations that are the lot of the black working class.

Both the strength and the weakness of the capitalist class in South Africa is revealed in the character of its social base.

On the one hand, the support of the white middle class and the white aristocracy of labour has given the SA capitalist class generations of political stability – and even a certain room to manoeuvre within the domination of imperialism. Out of these white layers the army, the police force and the state bureaucracy have chiefly been filled, and factory foremen and supervisors drawn. Stampeded behind barriers of racial privilege they have formed a bastion of reaction, millions strong, against the mass of the working class.

At the same time, the racist character of capitalist rule – directed of necessity against the entire black population – reflects the weak position of the South African bourgeoisie.

In the older capitalist countries of Europe, where capitalism arose out of petty production over a long period of time, broad layers of the middle class provided the initial buffer for the bourgeoisie against the emerging proletariat. Only with the transition to imperialism did the capitalist class begin to extend the base of its support among the upper layers of the working class. We have explained already the conditions in Europe which made this process necessary, and possible.

In South Africa, on the other hand, the late but meteoric development of capitalism rapidly polarised society between the monopoly capitalists on the one hand, and the mass of the working people on the other. From the start, the middle layers of society were relatively insignificant. No room existed for a middle class to develop a substantial role in production. This was especially true of the black middle class which, from the beginning, was stunted in its development.

The social weakness of the middle class ruled out the possibility for the bourgeoisie to rest its rule simply on this layer. The bourgeoisie turned increasingly towards the development of its dictatorship on the basis of divisions of race, with the cultivation of a white aristocracy of labour to supplement the white petty bourgeoisie.

Wherever it exists, capitalism engenders lines of competition and division among workers which cannot be overcome by purely spontaneous struggles. It is precisely the development of class-conscious leadership within the ranks of the workers’ movement which is needed in the struggle to bring about the unity of the working class. The weakness of the forces of Marxism in South Africa and internationally left scope for the bourgeoisie to carry out its policies of divide-and-rule with deadly effect upon the working class.

Yet the creation of a privileged section of the working class – the whites – did not take place without conflict. At every stage the bourgeoisie was obliged to balance its need for a stable basis of support among the whites against the imperatives of profit.

Racial protection of jobs, access to collective bargaining mechanisms, increased material welfare, have only been extended to the white workers with reluctance. This has only been done – as is clearly shown by events from the 1890s to 1922 and from the 1930s to the 1950s – to ward off greater dangers from the mass of the workers (the blacks), only in conditions of economic advance for capitalism, and only on the terms laid down by the ruling class itself.

The privileges granted to the white workers were preceded by the repression of their sectional class action (most decisively the crushing of the 1922 Rand Revolt). Conversely, those layers of the white working class who were denied special treatment by the ruling class – such as the women garment workers during the 1930s – remained open to a programme of struggle on the basis of working-class unity.

A crucial role in this system of rule has been played by the reactionary leadership of the white workers’ organisations. From the treacherous, vacillating ‘liberals’ such as Anna Scheepers to avowed reactionaries such as the racist Arrie Paulus, these leaders have consistently collaborated with the capitalist class in maintaining the divisions of colour and privilege within the working class and in supporting the regulation of trade unions by the state.

That is the elaborate structure of class collaboration that forms the foundation of what appears as ‘white minority rule’.