Coen Welsh | Aug 9, 2017 | 0
There is a herd of tortoises on my front lawn
“Among many of the systemic flaws of autocracy, degeneration at the top, epitomised by ever-weaker leaders, is progressive and incurable. The exclusive and closed nature of autocracy bars many talented individuals from rising to senior government positions, owing to a pattern of succession that rewards political loyalty over capabilities. In fact, savvy autocratic rulers favour less talented successors, because they are easier to groom and control on their way to power.”
These incisive words come from the mind of noted Chinese academic, Professor Minxin Pei, Professor of Government at Claremont McKenna College and a non-resident senior fellow at the German Marshall Fund of the United States. In an article discussing the recent bogus regime change in China, Pei questions the durability of Chinese autocracy.
His observations and insight can be applied to a large number of African governments. It also applies to the ever-growing grip the government has on the local economy.
At last count, and this was some years ago, various government services and functions accounted for some 24% of Namibia’s GDP excluding the contribution from parastatals. Classic economics call this the “crowding out” principle. The moment the government controls a sector, an industry or a company, it only appoints those individuals previously identified to protect its own political interests with a disregard for the long-term sustainability of the entity. And as long as there is a sufficient supply of taxpayers’ money, this lethargic implosion bothers nobody.
It is only when the deficit gets out of hand and unmanageable that suddenly, those with a little mind realise this process can not continue ad infinitum.
I have to admit, we are still a long way from an immediate and disruptive implosion of the economy, although I am not always so sure that an external shock, like a worldwide recession, may not reveal the true nature of the deep incompetence running through our economic management.
And in my mind, government encroachment on the domain of the private sector, is the single most important factor pushing pervasive unemployment. Central control redirects capital to serve its own goals removing the dynamism that is the operating principle of an economy dominated by an independent private sector.
We have a proven track record of 22 years of incompetent boards, individuals appointed to positions with immense financial implications without the capacity ever to fulfil expectations as long as they toe the line and protect the status quo.
Our track record in terms of public works and public investment is equally impressive. The list of underperforming projects is much longer than I can recite here. The list of outright failures is not unimpressive either.
But when I look around in Windhoek, I notice that despite the absence of an official black economic empowerment policy, our local version works quite well – for the very few lucky cronies. The local empowerment policy goes under the name, BRR policy, and it rewards a small number of individuals exceedingly well. And it is not difficult to spot the beneficiaries of this policy, they are fond of driving around in Black Range Rovers.
In the week, I was shocked to learn of yet another misallocation of funds. Under the TIPEEG programme, substantial funding has been earmarked for a range of projects in the identified sectors. To give the allocation process some semblance of due diligence, expensive analysts and consultants are hired to vet tenderers. But this is only eyeblind. Consistently, the agency that has the final say, overrides the recommendations, and allocate the tenders to political cronies, i.e. family and friends.
Again, I have much more information available on this, if anybody cares.
Where it really matters, very little of concrete substance happens. The National Pension Fund is a good example. Urgently needed by lower income workers, this project has been dragged along for the better part of fifteen years. In 1996, the concept was sunk by the unions who would not support it. In 2012 it is still a pipe dream.
Because it is so easy to stay in power with an ethnic power base, whenever the issue of responsibility is put on the table, it is convenient to blame somebody else, like a minority, or to blame history, like colonialism.
But on a popular level, most analysts avoid the real issue and that is, government’s control of the economy robs it of its vigour and its growth potential. The visible outcome, over many years, is rampant unemployment. But that is also easy to blame on somebody else.