All protocols observed. Distinguished ladies and gentlemen, you are gathered here today to discuss corruption. I can say without fear of contradiction that this a subject that this gathering is imminently qualified to discuss. In fact, it is conceivable that a gathering of people as knowledgeable as you are in matters of corruption is unprecedented in world history. The scions of crony capitalism are here. The lords of the land grabbing establishment are here. The dons of the tenderpreneur mafia are here. The money laundering fraternity— the lawyers, the accountants, the bankers, property moguls—you are all here.
My good friend and anti-corruption guru John Githongo has opined that we have, over the last two decades, assembled one of the most elaborate legal and institutional anti-corruption infrastructures in the world. It has made no difference at all. Corruption has continued to flourish. Nations renowned for honest government, such as the Scandinavian countries, are not distinguished by anti-corruption infrastructure. The normal accountability institutions —auditors, parliament, police and the courts—are sufficient. To borrow from computing, corruption is quite evidently not a hardware problem. It is the software that is corrupted.
The Oxford dictionary has four definitions of corruption, namely dishonest or fraudulent conduct by those in power; the process or effect of making someone or something morally depraved; the process by which a word or expression is changed from its original state to one regarded as erroneous or debased, and; the process by which a computer database becomes debased by alteration or the introduction of errors.
I suspect that in this convention your deliberations will be largely if not exclusively concerned with the first of these, namely, dishonest and fraudulent conduct, steering clear of election fraud, nepotism, debasement of the national honours system, corruption of harambee and much more. I need not dwell on the same since, as I have already observed, you are knowledgeable and experienced in those matters.
In this address, I will speak to the broader conception, namely to the process of alteration or debasement, or to borrow from the computer analogy, the corruption of software. I will do so by expounding on a theory of African politics due to Nigerian scholar Peter Ekeh known as the theory of the “two publics”. I will be quoting extensively from his paper Colonialism and the Two Publics in Africa: A theoretical statement published in the 1975 issue of the journal Comparative Studies in Society and History.
Ekeh begins with the proposition that in western societies, the public and private spheres are governed by the same moral values and ethical norms: “what is considered morally wrong in the private realm is also considered morally wrong in the public realm [and] what is considered morally right in the private realm is also considered morally right in the public realm.”
He proceeds to postulate that in post-colonial Africa there are two public spheres. There is the conventional public sphere which he calls the “civic or state” sphere, and another which he calls the “primordial” sphere. He then postulates that the private and the primordial public spheres share a morality that does not extend to the state public sphere:
“When one moves across Western society to Africa, at least, one sees that the total extension of the Western conception of politics in terms of a monolithic public realm morally bound to the private realm can only be made at conceptual and theoretical peril. There is a private realm in Africa. But this private realm is differentially associated with the public realm in terms of morality. In fact there are two public realms in post-colonial Africa, with different types of moral linkages to the private realm. At one level is the public realm in which primordial groupings, ties, and sentiments influence and determine the individual’s public behavior. I shall call this the primordial public because it is closely identified with primordial groupings, sentiments, and activities, which nevertheless impinge on the public interest. The primordial public is moral and operates on the same moral imperatives as the private realm. On the other hand, there is a public realm which is historically associated with the colonial administration and which has become identified with popular politics in post-colonial Africa. It is based on civil structures: the military, the civil service, the police, etc. Its chief characteristic is that it has no moral linkages with the private realm. I shall call this the civic public. The civic public in Africa is amoral and lacks the generalized moral imperatives operative in the private realm and in the primordial public.”
In western societies, the public and private spheres are governed by the same moral values and ethical norms: “what is considered morally wrong in the private realm is also considered morally wrong in the public realm [and] what is considered morally right in the private realm is also considered morally right in the public realm.”
Allow me to illustrate. Every day Kenyans gather to organize weddings and funerals. They contribute money. They form committees, and appoint treasurers to keep the money. This money is seldom if ever stolen. We do not hear that a funeral or wedding did not take place because the treasurer took off with the money. Once the mission is accomplished a final meeting is convened to “break the committee.” The treasurer presents his or her report. If there is a surplus, it is donated to the bereaved or the couple as the case may be. If there are debts, the committee deliberates on how to settle them. There are no laws governing these undertakings. Increasingly, in urban settings, the activities are multiethnic thus we cannot say they are governed by tribal law. This is the primordial public—scrupulously honest and conscientious. This in the country with arguably the most corrupt states in the world. Same people.
You see, the state realm was a colonial imposition. It divided Africans broadly into those who resisted, and those who embraced it. Moral values do not apply in the sphere of oppression. The same applies to those who embraced it. Theirs was opportunism. They were motivated primarily by material gain. Both united in subverting it but for different reasons, as Ekeh explains:
“The African who evaded his tax was a hero; the African labourer who beat up his whjte employer was given extensive coverage in newspapers. In general, the African bourgeois class, in and out of politics, encouraged the common man to shirk his duties to the government or else to define them as burdens; in the same breath he was encouraged to demand his rights. Such strategy, one must repeat, was a necessary sabotage against alien personnel whom the African bourgeois class wanted to replace.”
The state realm was a colonial imposition. It divided Africans broadly into those who resisted, and those who embraced it. Moral values do not apply in the sphere of oppression. The same applies to those who embraced it. Theirs was opportunism. They were motivated primarily by material gain. Both united in subverting it but for different reasons…
Now that the African bourgeoisie has made an appearance, it is opportune to elaborate on it. A bourgeoisie is a capitalist class. In Europe, the bourgeoisie is the social class which emerged both as cause and consequence of the industrial revolution and capitalist development.
“In the course of colonization a new bourgeois class emerged in Africa composed of Africans who acquired Western education in the hands of the colonizers, and their missionary collaborators, and who accordingly were the most exposed to European colonial ideologies of all groups of Africans. Although native to Africa, the African bourgeois class depends on colonialism for its legitimacy. It accepts the principles implicit in colonialism but it rejects the foreign personnel that ruled Africa. It claims to be competent enough to rule, but it has no traditional legitimacy. In order to replace the colonizers and rule its own people it has invented a number of interest-begotten theories to justify that rule. I shall call the ideologies advanced by this new emergent bourgeois class in Africa the African bourgeois ideologies of legitimation.”
The bourgeoisie is associated with wealth creation and materialism.
The African bourgeoisie’s legitimising ideology is, I think, encapsulated by that ubiquitous political mantra “maendeleo.” Maendeleo is not development. Literary, maendeleo is to get rid of backwardness, to become modern. To drink busaa and chang’aa is not maendeleo. Beer and whisky is maendeleo. The maendeleo ideology is what Chinua Achebe characterizes as a “cargo cult mentality,” a “tendency among the ruling elite to live in a world of make-believe and unrealistic expectations”.
Ekeh has introduced another important concept that needs a remark or two, and this is the idea of legitimation. Legitimation is the process of making something morally acceptable to society. Legitimation is also about assuaging one’s conscience that there is a just cause behind unjust things. The legitimation of colonialism entailed presenting it as a civilizing mission, casting African ways as barbaric and backward, and Christianity and westernization as progress, bringing light to the heart of darkness. The African bourgeoisie’s predicament can be put as follows. It lacked the leadership credentials in the primordial public sphere—that belonged to the traditional rulers who colonialism had emasculated. Its power and comfort zone was in the state public—the amoral domain of oppression. How to square this circle?:
“Anti-colonialism did not in fact mean opposition to the perceived ideals and principles of Western institutions. On the contrary, a great deal of anti-colonialism was predicated on the manifest acceptance of these ideals and principles, accompanied by the insistence that conformity with them indicated a level of achievement that ought to earn the new educated Africans the right to the leadership of their country. Ultimately, the source of legitimacy for the new African leadership has become alien. Anti-colonialism was against alien colonial personnel but glaringly pro foreign ideals and principles.”
The African bourgeoisie’s legitimising ideology is, I think, encapsulated by that ubiquitous political mantra “maendeleo.” Maendeleo is not development. Literary, maendeleo is to get rid of backwardness, to become modern. To drink busaa and chang’aa is not maendeleo. Beer and whisky is maendeleo. The maendeleo ideology is what Chinua Achebe characterizes as a “cargo cult mentality,” a “tendency among the ruling elite to live in a world of make-believe and unrealistic expectations.”
Maendeleo ideology was and in many ways remains a fig leaf to cover the political nakedness of the African bourgeoisie, its inability to provide leadership on foundational questions of nation-building, among them how to transform the amoral state public sphere into an authentic values-based governance realm. To ask these questions was, still is, to become an enemy of maendeleo. To persist was, still is, to invite repercussions. There is perhaps no better specimen of the moral and intellectual crisis of the post-colonial African bourgeoisie than the ideological, political and economic incoherence of the (in)famous Sessional Paper No.10 of 1965 (African Socialism and its Application to Planning in Kenya).
Let us now consider the dialectics of the two publics. Dialectics simply means logic, or the process of reasoned inquiry. This will lead us directly into the subject of corruption.
On Friday you are hobnobbing with diplomats showing off your western sophistication, next day, you are being installed as a tribal elder adorned in monkey skins and porcupine quills Come Sunday, you are a suited picture of Christian piety buying indulgencies with money stolen from poor people. You are restless, troubled souls. This is what Ekeh means by psychic turbulence.
“Most educated Africans are citizens of two publics in the same society. The dialectical tensions and confrontations between these two publics constitute the uniqueness of modern African politics. A good citizen of the primordial public gives out and asks for nothing in return; a lucky citizen of the civic public gains from the civic public but enjoys escaping giving anything in return whenever he can. But such a lucky man would not be a good man were he to channel all his lucky gains to his private purse. He will only continue to be a good man if he channels part of the largesse from the civic public to the primordial public. That is the logic of the dialectics. The unwritten law of the dialectics is that it is legitimate to rob the civic public in order to strengthen the primordial public. (my emphasis)
“The native sector has become a primordial reservoir of moral obligations, a public entity which one works to preserve and benefit. The Westernized sector has become an amoral civic public from which one seeks to gain, if possible, in order to benefit the moral primordial public. Although the African gives materially as part of his duties to the primordial public, what he gains back is not material. He gains back intangible, immaterial benefits in the form of identity or psychological security. The pressure of modern life takes its toll in intangible ways. Behind the serenity and elegance of deportment that come with education and high office lie waves of psychic turbulence—not least of which are widespread and growing beliefs in supernatural magical powers. The primordial public is fed from this turbulence.”
I would like to believe that you recognize this description. Let me illustrate. On Friday you are hobnobbing with diplomats showing off your western sophistication, next day, you are being installed as a tribal elder adorned in monkey skins and porcupine quills Come Sunday, you are a suited picture of Christian piety buying indulgencies with money stolen from poor people. You are restless, troubled souls. This is what Ekeh means by psychic turbulence.
Corruption is a sine qua non of the post-colonial African State. You, ladies and gentlemen, are its handmaidens. Its unwritten law is that it is legitimate to rob the civic public in order to strengthen the primordial public. Until this law is repealed, so it will remain.
This then is the pathology of corruption. Corruption is a sine qua non of the post-colonial African State. You, ladies and gentlemen, are its handmaidens. Its unwritten law is that it is legitimate to rob the civic public in order to strengthen the primordial public. Until this law is repealed, so it will remain.
Sanitising Moi in the Age of Kenyatta, and the heroics of official revisionism
The revival of Moi Day marks a high point in Jubilee’s rehabilitation of the retired autocrat. Refashioned as a kindly, old gentleman who held the nation together in trying times, for Mzee Moi’s victims the latest attempt to celebrate official criminality is testimony of who exactly Mr Kenyatta sides with. By RASNA WARAH.
Sometime in the early 1980s, my father, who owned a photo studio on Moi Avenue in Nairobi, became a life member of the KANU party. The 1000-shilling membership came with a certificate and pins, the kind worn on coat lapels, with Mtukufu Rais Moi’s image on them. My father dutifully framed the certificate and hung it strategically in his studio where his customers could see it. In the studio’s window, he placed a large photo of His Excellency sitting at his desk in State House – a photo he had taken shortly after Moi’s inauguration in 1978.
At that time, many Kenyan Asian businessmen became life members of Kenya’s ruling (and only) political party. It was a way of showing loyalty to a president who was becoming increasingly insecure about his grip on power. For Kenyan Asians, who have always been uncertain about their citizenship, and who have on occasion been threatened with expulsion, demonstrating loyalty to Moi was a kind of insurance, a survival tactic.
In those days, the overriding concern among Kenya’s Asian minority was that Kenya could go the way of its neighbours, such as Somalia and Uganda, and become a military dictatorship. The abortive coup staged by the Kenya Air Force on 1 August 1982 had left Asians fearful; many Asian-owned shops had been looted on that day and some of the poorer Asians living in neighbourhoods like Ngara and Pangani had been robbed and physically assaulted by looters who had taken advantage of the chaotic situation.
Barely ten years before the coup attempt, in August 1972, President Idi Amin had expelled 70,000 Asians from Uganda. There were fears then that Kenya might also “do an Amin” and get rid of its economically prosperous Asian community. So when the coup in 1982 failed, Kenya’s Asians were more than relieved. For them, Moi had averted an economic and political catastrophe that could have adversely affected their business interests, and they were grateful to him for that.
Because Moi had entrenched a patronage system where sycophancy was encouraged, wealthy Kenyan Asian businessmen and industrialists made it a habit of visiting State House and making donations to Moi’s favourite causes. This financial support was often rewarded with government tenders or with assurances that the donors’ economic interests would be protected.
The devastating consequence of this system was that it enabled corruption among some unscrupulous members of Kenya’s Asian community, who began using their close connections to Moi and senior government officials to enrich themselves and their benefactors by using dubious means. Crooked Asian tycoons, like the Goldenberg scandal’s architect, Kamlesh Pattni, and Ketan Somaia (who is currently serving a jail sentence in the UK for fraud) flourished during this period.
Because Moi had entrenched a patronage system where sycophancy was encouraged, wealthy Kenyan Asian businessmen and industrialists made it a habit of visiting State House and making donations to Moi’s favourite causes. This financial support was often rewarded with government tenders or with assurances that the donors’ economic interests would be protected.
It was, therefore, not surprising that when it became clear that Moi’s reign was coming to an end, a panic set in among many Kenyan Asians. What kind of future would they have in a post-Moi era? Would the new rulers punish them for their past crimes? How would they secure their business interests? Would the whole community pay the price for the economic crimes of a few? (They needn’t have worried: corruption had by then become a way of life in Kenya, and members of the Mwai Kibaki administration, like those in Moi’s government, were adept at using Asian businessmen as front men to carry out its own grand corruption schemes, such as Anglo Leasing.)
When it became clear that Moi’s reign was coming to an end, a panic set in among many Kenyan Asians. What kind of future would they have in a post-Moi era?
After a brief venting period, where Kenyans were allowed to express their anger at what Moi had allowed the country to become, a process of sanitising Moi began. The historical revisionism argued that while Moi had proved to be a dictator, he had in fact been a benevolent one, one who supplied primary school students with free “Nyayo” milk, the one who brokered peace deals with troublesome neighbouring countries, the one who ensured that Kenya remained an “island of tranquility” in a strife-torn region – a line of reasoning that Kenya’s Asian business community had also adopted to explain why they supported Moi.
This process of sanitising Moi has been escalating since Uhuru Kenyatta and William Ruto (both protégés of Moi), assumed power in 2013. President Uhuru makes regular visits to his political godfather in his Kabarak home, and images of the man who held an iron grip over the country for 24 years have begun appearing more frequently in the media. Moi is increasingly being portrayed as a kindly old man who once held the country together. His prophecy that Kenya would disintegrate into tribal factions under multipartyism even appeared to come true after the 2007 elections when the country appeared to be on the verge of civil war. Twelve years after KANU was ousted, on Moi’s 90th birthday in September 2014, local newspapers carried glowing tributes to the aging dictator, prompting Daily Nation columnist Macharia Gaitho to wonder whether about the shortness of Kenyan memories.
After a brief venting period, where Kenyans were allowed to express their anger at what Moi had allowed the country to become, a process of sanitising Moi began… This proces…has been escalating since Uhuru Kenyatta and William Ruto (both protégés of Moi), assumed power in 2013… It reached a crescendo this month when Moi Day was celebrated. The official reason given was that the day had not been de-gazetted…
This whitewashing reached a crescendo this month when Moi Day was celebrated, albeit amid controversy. The day has not been observed since the new constitution was promulgated in 2010. (The constitution does not recognise Moi Day as a public holiday.) The official reason given for its return was that the day had not been de-gazetted and so technically and legally, Kenyans had no choice but to recognise it. So, millions of Kenyans who had planned to be at work or school on 10 October had to stay at home because the government ordered them to. Many wondered: of all the public holidays that this government chose to recognise, why would it choose the one that brought back painful memories for so many Kenyans?
Younger Kenyans who came of age in the Kibaki era have little recollection of the Moi days and the retrogressive policies that stunted the country’s economic growth and development by several decades. I once asked a 30-something what he remembered most about Moi, and his answer was simple: the free milk his school got every Tuesday and Thursday, thanks to Baba Moi. He seemed vaguely aware that Moi had done some bad things, but he was not exactly sure what those things were.
While it is true that Moi allocated a large chunk of the national budget to education, and schools bearing his name flourished, he also entrenched mediocrity and corruption within the civil service that allowed the country’s institutions to decay. The “Kalenjinisation” of all arms of government, the wanton grabbing of public land, the siphoning of public funds through friends and cronies, the looting of Kenya’s treasury and other forms of economic sabotage became endemic during his tenure. Moi also oversaw austerity measures imposed by the World Bank and the IMF in the 1990s that led to the deterioration of public services, such as health. By the time Moi left office in 2002, the country was virtually on its knees.
For the people who paid a heavy price for opposing the Moi regime, the declaration of Moi Day as a public holiday was like a slap in the face. Some of these people, like the environmentalist Wangari Maathai (who defied his regime and was beaten black and blue for opposing the construction of a tower at Uhuru Park), my journalist friend, Wahome Mutahi (who spent one year in jail on trumped-up charges of sedition), and opposition leader Kenneth Matiba (who was arrested and tortured and developed a debilitating illness as a result) are now dead, but among the living, there are still those who bear the wounds Moi’s government inflicted on them. I am thinking in particular of the thousands of Kenyans who were tortured or illegally detained by Moi’s men because they were suspected of being dissidents belonging to underground movements like Mwakenya or because they resisted Moi’s authoritarian regime.
For the people who paid a heavy price for opposing the Moi regime, the declaration of Moi Day as a public holiday was like a slap in the face.
The genius of the Moi system is that it normalised everything. Nyayo House, which housed both the Immigration Department and Kenya’s slick new TV channel, KTN, was a site of unspeakable torture. In the torture chambers in the basement, Special Branch officers worked on the detainees. The most dreaded of them was James Opiyo. His name still sends shudders through his victims’ spines. Upstairs, people formed orderly queues for new passports on the ground floor, or read the news on the top floor. They were aware of what was happening in the basement. No one mentioned it or thought it was weird.
‘The Nyayo House basement was no ordinary police cell. In the water-logged rooms detainees stood naked for hours on end. One victim, George Odido, told the Truth, Justice and Reconciliation Commission that he was left submerged in one foot of water for three days without food, and in total silence. Because of the fear of drowning, the detainees did not sleep. Many were crippled for life or suffered severe psychological trauma. Some of these detainees’ fake trials took place in the middle of the night, where compromised judges would hand them harsh jail sentences for crimes that they had not committed.
The genius of Moi was that he made everything look normal even when it was not. He turned Nyayo House, which housed both the Immigration Department and Kenya’s slickest new TV channel, KTN, into a site of unspeakable torture. In the basement of detainees Special Branch officers worked on them. Those applying for passports or reading the news were aware people being tortured downstairs…no one mentioned it or thought it was weird.
We must also remember than it was during Moi’s tenure that the Wagalla massacre in Wajir took place, a shameful “security operation” that resulted in the death of an estimated 4,000 ethnic Somalis in Kenya’s north-east. Moi was president when Foreign Affairs minister, Robert Ouko, was assassinated. And despite his rhetoric of ethnic harmony, his leadership saw the killing and expulsion of thousands of Kikuyus in Rift Valley Province prior to the 1992 and 1997 elections. Not to mention the many anti-government protestors who lost their lives at the hands of the police during demonstrations, such as Saba Saba.
There was also collateral damage. There were the mysterious deaths of people linked to Ouko’s death, including that of Hezekiah Oyugi, the head of Internal Security and one of the main suspects in Ouko’s murder, and Philip Kilonzo, who was the Commissioner of Police when Ouko was killed. One does wonder: if Moi’s government was capable of orchestrating the deaths of his own people, people who were loyal to him, then how many of his opponents were also made to “disappear”?
The Nyayo House basement was no ordinary police cell. In the water-logged rooms detainees stood naked for hours on end. One victim, George Odido, told the Truth, Justice and Reconciliation Commission that he was left submerged in one foot of water for three days without food, and in total silence. Because of the fear of drowning, the detainees did not sleep.
For all those who suffered physical or emotional torture, illegal detention or financial ruin at the hands of Moi, the reinstatement of Moi Day is a painful reminder of not just what they lost during his rule, but also of how his shadow still lurks over Kenya.
Knowledge and Growth: What Paul Romer’s Economics Nobel Prize says about Africa’s infrastructure obsession
If knowledge and human capital are the engines of economic growth, what is the role of the foreign investment and infrastructure edifices that our governments are obsessed with? By DAVID NDII.
The Nobel Prize season is one of the things I look forward to, not least because there is a prize in economics. But the more important reason is that it is always a welcome reminder that humanity’s most important work is not done by the powerful, the moneyed and the celebrities that hog the daily limelight, but by the people of ideas and ideals. And in these dog days of an apocalyptic time, it could not come often enough.
This year’s economics Nobel Prize was shared by William Nordhaus and Paul Romer for contributions to natural resource economics and economic growth respectively. The commonality between their work is rather technical and I shall not go into it, but it has to do with developing methods of analyzing the interaction of the economy with complex phenomena — in Nordhaus case, climate, and in Romer’s, knowledge. The latter is the subject of this column.
Romer pioneered what is now known as new or endogenous growth theory. Hitherto, economists treated knowledge and technical progress as “exogenous”, that is, something that occurred outside the economic system. This was quite awkward since it was quite obvious that research and innovation were fundamental elements of the economic system.
This year’s economics Nobel Prize was shared by William Nordhaus and Paul Romer for contributions to natural resource economics and economic growth respectively. The commonality between their work…has to do with developing methods of analyzing the interaction of the economy with complex phenomena — in Nordhaus case, climate, and in Romer’s, knowledge.
Another seminal contribution was made by Robert Lucas, the 1989 Nobel Laureate. There is an interesting backstory to his prize. Seven years before, his ex-wife had inserted a clause in their divorce settlement that entitled her to half the prize money if he won it. The prize came 21 days before the provision lapsed. Romer’s prize has an interesting backstory too: he is the second chief economist of the World Bank to leave the institution acrimoniously only to be awarded the Nobel Prize shortly thereafter— the other one is Joseph Stiglitz.
Paul Romer’s model emphasizes the role of knowledge in long run economic growth; Lucas model emphasizes human capital. The two are intimately related but are not the same thing, although many people, including economists, often conflate them. Let me illustrate.
I came across a trending story—about a young Philippino inventor who had just successfully tested his passenger drone in the provincial city of Batangas, Watching the video, his geek-in-a garage drone is as good as those that have been showcased by tech companies with lots of venture capital money. In fact, it looked more fun to fly than the ones I have seen before. And the guy is not even an engineer. And he built it in a garage. An Australian company was sufficiently impressed to propose a commercial partnership. It was then brought to my attention, pleasantly so, that a young Kenyan, Morris Mbetsa, has built and tested one—he tweeted me video footage.
“How to build a passenger drone” i.e. the science and engineering is knowledge—that’s Romer.. The ability of a geek in a garage in Batangas and Ong’ata Rongai to use that knowledge to build a drone in a garage in Banda is human capital— that’s Lucas. One can think of Romer’s model as explaining how the world becomes more prosperous; Lucas’ as explaining why we see developing countries catching up with rich countries. When the Wright brothers made their maiden flight in 1903, it was hard to imagine a native in the colonies somewhere in Africa or Asia making a viable attempt to manufacture an aircraft. A couple of decades ago it took an entire national industrial project to make “Nyayo Pioneer”, the ill-fated contraption that stalled on the track in Kasarani stadium on the occasion of its launch. All the same, from the look of things your future personal transportation could well be made in Kariobangi.
How to build a passenger drone’ i.e. the science and engineering is knowledge—that’s Romer.. The ability of a geek in a garage in Batangas OR Ong’ata Rongai to use that knowledge to build a drone in a garage in Banda is human capital— that’s Lucas.
If knowledge and human capital are the engines of economic growth, what is the role of the foreign investment and infrastructure edifices that our governments are obsessed with?
The title of one of Lucas’s less well known papers on the subject, published in the 1990 edition of the American Economic Review, poses the following question: Why doesn’t capital flow from rich to poor countries? The article links investment, human capital and growth in a simple and intuitive manner. Suppose there are only two countries, a rich and a poor one – let’s call them America and Bangladesh. Average monthly factory wages in the two countries are $1800 and $60 respectively – that is, wage in America is 30 times more than in Bangladesh. At first, they do not trade. Each country makes its own clothes. Suppose they decide to trade?
Let us say it takes a worker one hour to stitch together a pair of jeans. In America, the labour cost for this is $11.25. In Bangladesh, it would cost $0.325. Even if productivity in Bangladesh was only a third of America, it would still cost a dollar to stitch the pair of jeans in Bangladesh. Let us say Made in America sold for $50. The retailers could sell Made in Bangladesh jeans at $45 dollars and still make $5 more. Off-shoring garment factories to Bangladesh would be very profitable. This would continue until Bangladeshi wages rise to the point where cost of production is the same in both countries. As it happens, the wage figures cited are quite close to what the actual wage costs in America and Bangladesh are. And indeed Bangladesh is now second to China in garment exports, earning US$ 28 billion last year, and employing over four million people.
The garment making industry makes a good example because it is a very basic skill that we can reasonably expect people with little or no education to learn quickly and do as well as better educated ones. Using similar analogy with US and India, but with more sophisticated data and mathematics, Lucas demonstrated that at the time he was writing, the return on capital in India would have been 58 times more than in the US. This then begs the question: with profitable opportunities of this magnitude why are poor countries not inundated with investment?
But once you move from low tech manufacturing like stitching garments, offshoring becomes a little more challenging. It takes armies of engineers and techies to manufacture commercial jetliners and all manner of scientists to do pharmaceutical research. Using very basic measures of education attainment, Lucas’ model demonstrates that once differences in human resource base are taken into account the potential returns to capital in India reduce to just 4% above the US.
In a previous column, I used similar data to show how initial differences in human capital may give answers to the questions that can’t seem to stop Africans from scratching heads: how it is that countries we are told we were “at par” with at or shortly after independence took off, and we did not. In 1970, the Kenyan workforce had an average of two years of education per person, and was the highest in the region. South Korea’s had six, Singapore five and Malaysia four years per person. In fact, South Korea’s education attainment was higher than several European countries including Portugal (3), France (4.8), Spain (5.6) and Italy (5.6) years per person. South Asia by contrast was in the same league with Africa—India (1.6), Pakistan (1.6) and Bangladesh (1.4). Sri Lanka is an outlier with 6.4.
Education attainment data provide only a rough approximation of human capital, even though the data have proved to be quite robust in economic research. The World Bank has recently published its latest national wealth accounts, in a report titled The Changing Wealth of Nations. National wealth accounting is a new statistical initiative that responds to the shortcomings of gross domestic product (GDP) as a measure of economic performance. As many readers will know, GDP and its derivatives are measures of production and expenditure, which in business accounts correspond roughly to annual turnover. As currently constructed, national economic accounting does not produce the equivalent of balance sheets, that is, the assets and liabilities of a business. To illustrate, the Jubilee administration has borrowed KSh 3.5 trillion but there is no account where we have recorded the value of assets acquired with these loans. One of the assets financed, the SGR railway, has cut through the Nairobi National Park. We ought to be able to revalue the park to reflect the loss of both economic and ecological value caused by the railway, but there is no way of doing that in the GDP system. This is what national wealth accounting seeks to remedy.
This latest version, which provides wealth accounts for the year 2014 has what the Bank says is the “first sound estimates of human capital”. With wealth accounts we are able to compare the relative importance of different assets in a nation’s wealth directly. What do they tell us? First, that human capital accounts for two-thirds of the world’s wealth. Second, the wealthier the country the higher the proportion of human capital in its wealth portfolio. It ranges from 40 percent in low income countries, to 70 percent in the high-income OECD countries (See chart below). In the wealthiest region, North America, human capital accounts for 77 percent of total wealth, compared to half of national wealth in Sub-Sahara and South Asia. The Middle East/North Africa is an outlier with only a third of its wealth in human capital on account of the region’s unusually high oil wealth.
National investment rates in most developing countries are between 15 to 25 percent of GDP while expenditures on education and health (both public and private) are between 5 and 10 percent of GDP. Roughly, this suggests that a dollar invested in people generates five times as much wealth as a dollar investment in other assets. This should not surprise—think of a million shillings invested in an engineering degree against the same amount invested in a rental apartment.
Human capital accounts for two-thirds of the world’s wealth. […] the wealthier the country the higher the proportion of human capital in its wealth portfolio. It ranges from 40 percent in low income countries, to 70 percent in the high-income OECD countries… In the wealthiest region, North America, human capital accounts for 77 percent of total wealth, compared to half of national wealth in Sub-Sahara and South Asia. The Middle East/North Africa is an outlier with only a third of its wealth in human capital on account of the region’s unusually high oil wealth.
Eight years ago, the African Development Bank (AfDB) published a report in which it estimated that Africa has an infrastructure financing requirement of US$ 93 billion a year to the year 2020. The figure was subsequently adjusted upwards to $120 billion a year— a cumulative figure of 1.2 trillion dollars. Consequently, less than two decades after the HIPC (Highly Indebted Poor Countries) debt forgiveness initiative many African countries are now hurtling towards a second debt crisis.
It is stated in the AfDB report that the purpose of building on this scale is to crowd in the investment to create jobs. Texas Instruments was the first Western company to invest in Bangalore. I came across a photograph of the first equipment Texas Instruments delivered to its first facility, in a bullock cart. Texas Instruments was attracted by Indian workers, not its roads. In fact, there is no account of India’s tech boom that does not mention the Indian Institutes of Technology (IITs). It is now said that IIT graduates are now India’s leading export to the US.
Eight years ago, the African Development Bank (AfDB) published a report in which it estimated that Africa has an infrastructure financing requirement of US$ 93 billion a year to the year 2020…The figure was subsequently adjusted upwards to $120 billion a year— a cumulative figure of 1.2 trillion dollars. Consequently, less than two decades after the HIPC (Highly Indebted Poor Countries) initiative many African countries are now hurtling towards a second debt crisis.
In all the documents and discussions I have encountered, there is no acknowledgement that Africa does not have the skills—the engineers, architects and builders—to scale up building on anything close to this scale of investment, and to maintain it subsequently. Let us do the math. An engineering degree on the continent is at most $25000. The $120 billion annual “infrastructure deficit” budget works out to six million engineers. That is a whole passenger drone industry right there. And of course, once we are zipping in drones, we will not be needing so many roads.
In all the documents and discussions I have encountered, there is no acknowledgement that Africa does not have the skills—the engineers, architects and builders—to scale up building on anything close to this scale of investment, and to maintain it subsequently.
There is no evidence in economics that infrastructure investment contributes to economic growth.
This conclusion by the Asian Development Bank is typical:
“The main conclusion is that a number of countries in developing Asia have significantly improved their basic infrastructure endowments in the recent past, and this appears to correlate significantly with good growth performances. However, the evidence seems to indicate that this is mostly the result of factor accumulation (a direct effect), while the impact on productivity is inconclusive.” – Stéphane Straub and Akiko Terada-Hagiwara (2010) “Infrastructure and Growth in Developing Asia” ADB Economics Working Paper Series No. 231.
Mwalimu Nyerere: Development which is not development of the people may be of interest to historians in the year 3000. It is irrelevant to the kind of future which is created. Thus, for example, the pyramids of Egypt and the Roman roads of Europe, were material developments which still excite our amazement. But because they were only buildings and the people of those times were not developed, the empires, the cultures, of which they were a part have long ago collapsed. The Egyptian culture of those days—with all the knowledge and wisdom which it possessed—was quickly overthrown by foreign invaders because it was a culture of a few; the masses were slaves who simply suffered because of the demands of this material development, and did not benefit from it.
#MeToo: Memories of Sexual Assault are NOT a Figment of Women’s Imagination
Listening to Christine Blasey Ford’s heart-rending testimony before the US Senate triggers traumatic memories for RASNA WARAH.
The claim by President Donald Trump and others supporting the appointment of Judge Brett Kavanaugh to the US Supreme Court that it is impossible for a woman to remember every detail of a sexual assault that occurred more than 30 years ago cannot go unchallenged. Every woman who has experienced a sexual assault of any kind remembers every detail of the encounter. She may not remember the day it took place, or what she was wearing or even the exact location, but details of the assault itself usually remain indelibly etched in her memory.
Women watching Dr. Christine Blasey Ford recounting the details of what she claims was a sexual assault by Judge Kavanaugh when they were both teenagers were warned that watching her speak at a US Senate hearing might trigger their own memories of similar incidents. Indeed that is what happened to me. As I watched Ford give her testimony, I found myself recalling events that I had long buried somewhere in my mind.
I remembered 1985, when I was a university student in the United States. I had just got off the bus and was walking to my apartment in Quincy town on the outskirts of Boston when I noticed a black sports car parked next to a curb and the white man in it jerking himself off while looking at me with a grin on his face. Having never been “flashed” before, I found myself paralysed and unable to move. I did eventually muster my legs to run to my apartment. I do not remember the exact day or time this happened, but I do remember the man’s face. He must have been in his 30s or 40s and had dark wavy hair and small beady eyes. I never told anyone about this incident (until now) because I dismissed it as one of those things that deranged men do to frighten or intimidate women.
Women watching Dr. Christine Blasey Ford recounting the details of what she claims was a sexual assault by Judge Kavanaugh when they were both teenagers were warned that watching her speak at a US Senate hearing might trigger their own memories of similar incidents. Indeed that is what happened to me.
A year or so before, I had almost been raped by a man who was driving me home from a party. I didn’t know the guy very well, as I had only met him for the first time at the party. On the way back to my dorm in Boston, he stopped at an empty parking lot and proceeded to unzip his trousers. He then took out his penis and ordered me to suck it. I said no, and then lit a cigarette and threatened to burn his penis with it. I think I managed to scare him. He quickly dropped me off on a street that was nowhere near my dorm, yelling obscenities and calling me a tease. I didn’t tell anyone about this incident either because I blamed myself for allowing a man I barely knew to drive me home. But for years afterwards, I did wonder if my lighter and cigarettes had helped me ward off a rape.
I remembered 1985, when I was a university student in the United States…a black sports car parked next to a curb, the white man in it jerking himself off while looking at me with a grin on his face…I never told anyone about this incident (until now)… I dismissed it as one of those things that deranged men do…
In those days, the term “date rape” had not been popularised in American college campuses, and so not much was said when we learnt that a college-mate had been sexually assaulted, or even possibly gang-raped, at a college frat party in an elite university in Boston. I remember one instance vividly. My dorm mate, who happened to be a devout Catholic, asked me to wait in the reception for her while she went upstairs with a male student she had just met. I didn’t think much of the dangers that she might be exposing herself to at the time. (In US college campuses in those pre-HIV/AIDS days, it was quite normal for students to engage in casual sex.) When she didn’t return hours later, I decided to go back to my dorm, thinking that perhaps she had decided to spend the night with her new friend.
The next day, she returned to the dorm, visibly bruised and traumatised. It was obvious that she had been raped. She did not say what happened to her, but her demeanor suggested that she had been through something physically and emotionally painful. Her mental condition deteriorated to the point where her parents had to be called to pick her up and take her home. She never returned to college.
And no one in the college administration tried to identify the boys who had done this to her or to charge them with sexual assault. It was just not the done thing in those days. She probably blamed herself for the “sin” she had allowed to be committed against her, and being a Catholic, she probably even forgave her attacker/s. This is the thing that people don’t get about sexual assault – the victims always feel a sense of shame and guilt, and this is what often prevents them from coming forward. Worse, they are made to feel that the assault was just a figment of their imagination. Yet, as data shows, almost every woman in the world will experience or has experienced some form of sexual assault or harassment in her lifetime. So why is it so hard for people, especially men, to believe that this is happening?
A year or so before, I had almost been raped by a man who was driving me home from a party.
But was the reality TV-type US Senate hearing of Ford’s claims really necessary? I don’t think so. In my opinion, Ford should not have agreed to present her case in public on camera in front of the whole world, especially considering that she had previously requested to remain anonymous, and also because women who come forward publicly with such charges are often ridiculed, and made to feel bad all over again.
And indeed that is exactly what happened. A few days after the hearing, Ford was mocked and made fun of by none other than the President of the United States who suggested that she had made up the whole story at the behest of his political opponents. The laughter that echoed at the Mississippi rally where Donald Trump derided Ford probably brought back memories of the “uproarious laughter” that she says she remembers most about the sexual assault incident in 1982. For those who watched the rally on television, the most shocking scenes were those of women in the crowd laughing and jeering.
Until the #MeToo movement gained momentum, most victims of sexual assault or harassment believed that they were to blame for what happened to them. What the #MeToo movement has done is shift the blame to the perpetrators, thereby liberating women (and men) to speak openly about the trauma they suffered. It is likely that the recent barrage of revelations about Catholic priests in the United States and Australia molesting or raping boys may have remained a secret if these boys (who are now middle-aged men) had not been emboldened by the #Me Too movement. For the first time in a long time, it has become okay for women and men to say they were raped or sexually harassed without feeling that they will be put on the dock and not be believed.
But, as the Senate hearing has shown, despite the #MeToo movement, it is still difficult for sexual assault victims to be believed. And when they do come out, all kinds of questions are raised about their mental health, rather than the mental health of the perpetrators even though during most of the hearing, it was Ford who appeared coherent (though visibly flustered) while the man she was accusing appeared hysterical and overly defensive. Kavanaugh even managed to paint himself as a victim of a left-wing conspiracy. And despite his repeated declarations about how much he liked beer, none of the members of the male-dominated Senate accused him of having a drinking problem.
Until the #MeToo movement gained momentum, most victims of sexual assault or harassment believed that they were to blame for what happened to them.
In 1991, Anita Hill, a bright young black lawyer, accused Clarence Thomas (another US Supreme Court nominee) of sexual harassment, and she was not believed. She was vilified and accused of being a “man-eating professional” who was just seeking attention. To see this happen now, once again, 27 years later, is discouraging.
Some feminists like Germaine Greer have even stated that women who claim to have been sexually harassed or assaulted by powerful men might have willingly agreed to have sex with these men. Of the Hollywood actresses who have accused movie moguls of sexual assault or harassment, she had this to say: “If you spread your legs because he said ‘be nice to me or and I’ll give you a job in a movie’ then I’m afraid that’s tantamount to consent, and it’s too late now to start whingeing about that.” It is disheartening to hear these sentiments expressed by someone who has spent a lifetime examining male-female relations and how they impact sexuality.
Greer, of all people, should know that rape and other types of sexual assault or harassment are political issues – because they are the result of skewed power relations between men and women. When the man raping or sexually harassing a woman has the power to make or break her career, the issue of consent becomes murky and blurred. What does consent mean in this context?
And it really doesn’t matter if the assault was a rape or a groping of groins while fully clothed; the impact on women and girls is the same. (I still remember to this day when a big burly man came up behind me, fondled my buttocks and let out a great big guffaw as I was walking to school from my home in Nairobi. Like Ford, it is the laughter I remember most about that incident. That happened more than 40 years ago, when I was around 10-years-old, but I am still wary of walking alone on lonely lanes.)
Recently the Bollywood actress Tanushree Dutta stated that the “casting couch” is alive and well in Bollywood and that leading male actors routinely ask their female co-stars to have sex with them before they approve them for a role. (Apparently, the casting of leading ladies in Bollywood happens in actors’ trailers and hotel rooms, not in the offices of casting directors). Dutta has not had a leading role in a Bollywood movie since she accused a much-respected male co-star of sexually harassing her. This shows that when a woman comes out and accuses her boss or colleague of sexual harassment, she is likely to be committing career suicide. She will be ridiculed, not believed, and most likely fired. Which woman would risk facing all this?
It really doesn’t matter if the assault was a rape or a groping of groins while fully clothed; the impact on women and girls is the same.
So when a woman does come forward, chances are that she has either calculated the risks in her mind and has decided to do what is right no matter what. Some argue that women who come out years after being sexually assaulted – when both they and the accused have got married, had children and moved on with their lives – are not doing anyone a favour as many lives and reputations are destroyed. The problem with this argument is that it assumes that the perpetrator has stopped attacking women now that he is happily married with children. As the Harvey Weinstein and Donald Trump cases have shown, men do not stop grabbing p….. just because they have a beautiful wife and children home. Men who commit such crimes or misdemeanors – and constantly get away with them – are likely to continue committing them unless they are made to account for their actions.
All the men and women who support abusive men should know that sexual crimes have no expiry date and that if this culture of misogyny and male entitlement continues, it is their daughters who will one day pay the price.
The Women for Trump brigade and all the men and women who support abusive men should know that sexual crimes have no expiry date and that if this culture of misogyny and male entitlement continues, it is their daughters who will one day pay the price, if they are not paying it already.