being frank about dodd-frank

The proponents of Dodd-Frank present the issue in such a way that one may think that eastern Congo is a sovereign, independent country. The legislation fails to place the problems of the Kivus in the context of a national crisis that requires robust engagement at the national level. The Enough Project has been eager to display a letter of endorsement signed by 35 Kivu-based civil society groups. That is hardly a buy-in by the Congolese at the national level.

Unless Dodd-Frank is about US consumers and companies, the activists and their partners in Congress should confront the real causes of the conflict, which are failed leadership and corruption in Kinshasa, and predatory policies of Rwanda and Uganda who destabilize eastern Congo while benefiting from the trade. Cleaning up eastern Congo requires the courage to denounce, and pressure all guilty parties through a variety of means, including International Criminal Court indictments, freezing the assets of militia leaders and their backers, and diplomatic pressure on the governments of DRC, Uganda, Rwanda, Burundi and Tanzania.

Real change will only happen when a combination of bold measures is part of a comprehensive policy that addresses the crisis’ multifaceted nature as was done with blood diamonds for Sierra Leone and Liberia. These measures included UK-sponsored military intervention and state-building initiatives, the restoration of state authority, the dismantlement of militias, the Kimberly process and the pursuit of justice, which eventually led to the arrest of Liberia’s former President Charles Taylor. Pretending otherwise in DRC would be disingenuous.

That is Hoover fellow Mvemba on Huffpost. I concur.

One Day I Will Right About This Place: A Memoir

After reading the Economist’s rather harsh review of Binyavanga’s new book I decided to order it on Amazon. I was not disappointed (although I must admit that the Economist was right as far as editing goes. They could have done better).

The book is vintage Binyavanga, a fast paced read with insertions of commentary hear and there. The political commentary could have been done better – but that might just be the Political Scientist in me wanting more. I also felt like Binyavanga could have done more telling of the struggles of a young writer. How many manuscripts got rejected? How exactly did he discover his calling to become a writer? (he talks a bit about how he loved reading and hated other subjects in school but it would have been nice to know how as an adult this happened).

The book is great in many respects, but for me what did it was the combination of witty political commentary and a narration of a struggle against family expectations and personal failures.

I highly recommend it.

What I am reading right now

Siaya is hot and rainy – it rains every day in the afternoon. I am not kidding.

This has allowed me time to read when I am not hanging out with my extended family or doing some of my own work.

I finally started reading Portfolios of the Poor. Fascinating read, especially now that I am spending some time in Siaya. My time in Siaya has also made me think that poverty is not just about small, irregular and uncertain cash flow. It is also about ideas and mindsets. I have talked to quite a few people who would be living in better dwellings and eating better if only they had the right ideas. I have seen theoretical works in evolutionary game theory on inter-generational transfer of ideas and stuff, but almost no empirical social-scientific work on the uptake of ideas within communities.

I am also reading Fukuyama’s Origins of Political Order. Great book, with echoes of Huntington all over the place. I have my issues with Huntington and his scions but the fundamental concept of the degree of government being an indispensable precondition for political competition and socio-political development is hard to ignore. I highly recommend this book.

Lastly, I am almost done with Poor Economics. Great read for those not well versed with the amazing world of RCTs. I happen to be one leaning more towards structural reforms rather than targeted program interventions, but it is still a good read nonetheless.

Maintenance of infrastructure still a major challenge in Africa

A good measure of state effectiveness is how well stuff is maintained. In well run places repainting is always on schedule. Potholes are fixed. And the light bulbs are not loose. I was reminded of this fact while on transit in Addis last Friday.

In 2006, the last time I was there, Bole International Airport in Addis Ababa was a swanky new airport. It made me feel like JKIA in Nairobi was a joke. But only five years later the place is a shadow of its former self. The loos are poorly maintained, especially the one near gate 8: It only had one urinal and there was only one elderly lady cleaning both the gent’s and the ladies’ thus creating a lot of awkwardness.

The problem at the Addis airport ails the infrastructure of most of the developing world. Roads, buildings, gardens etc are all poorly maintained. It’s like no one sees the potholes, the peeling paint or the overgrown gardens. Or may be no one cares. Either way the lack of maintenance imposes very high costs since the once in a while maintenance drives oftentimes start when it is too late – which invariably means that the whole thing (especially with roads) has to be done again.

This is a void (infrastructure maintenance) that can be filled by the private sector. IFIs that finance these major infrastructure projects to begin with can, in conjunction with domestic governments, hire private companies to maintain the expensive roads, bridges, airports, etc. This will not only save money but also create jobs for millions of young men and women who have very little prospect of finding gainful employment

The decline of odious ODA?

The Economist has a piece outlining the paradox of Indian overseas development assistance (to the tune of 11 billion over the next 5-7 years). With figures from the CIA factbook I have calculated that about 300 million indians live below the poverty line. The Economist piece also touts the emergence of middle income donors, especially among the BRICs.

In this world Europeans and Americans no longer dominate aid. China is the biggest source of investment in Africa and the Gates Foundation is as important as many donor governments (and much more innovative). Private capital flows to Africa outstrip aid flows, contradicting an old justification that aid is necessary because investors hold back.

For the poorest, the new donors are more important because Western aid is shrivelling. Congress is proposing to chop American aid by a fifth. Brazil is giving more to the Somali famine than Germany, France and Italy combined. There are exceptions: Britain and Australia promise to boost aid spending. But they seem like a last hurrah of Western generosity.

Adding that:

In this new world the justification for aid and the behaviour of donors must change. For India and others, it is far from clear why the government should send aid abroad when it has so many poor people at home. No doubt, aid will be defended as a boost to global influence. The risk for India is that, just like the West did in the 1960s, it will pour money into grand projects which fail—and encourage bad government.

I disagree with this latter assessment. It is not aid per se that caused the epic governance problems facing most of the low-income countries of the world. Sure it stunted the co-evolution of accountable government and domestic revenue generation. But the biggest failure of aid was what it was spent on.

Aid being highly fungible meant that most of the money wound up in the private accounts of venal leaders and gun-runners.

Things have since changed a bit. For instance, China’s resources-for-infrastructure deals can be a model for Aid 2.0 (this no doubt needs some tweaking too, as this damaging expose on Sino-Angolan oil deals shows). Plus this time the infrastructure investments are different. In an earlier period most of the investments were overtly white elephant projects (like Moi’s infamous hydro-electric dam in Turkwel). Most of the current projects are in roads, telecoms, and to some extent agriculture – investments that will have a much bigger impact because of their broader reach.

You can find a related earlier post here.

More on Eritrea and armed groups in eastern Africa

While Eritrea has in the past been repeatedly accused of supporting Somalia’s Islamist militia Al Shabaab, a charge it strenuously denies, the current report catalogues Afewerki’s growing notoriety in the world of terrorism finance, and in particular the global web through which these funds are routed, with Kenya serving as a global transaction distribution hub.

The report details the country’s activities in funding the terror group, following the money trail from its citizens in the diaspora in Europe and North America, through Dubai and the Eritrean embassy in Nairobi, and into the hands of Al Shabaab, all the while concealed in convoluted and opaque informal financial networks.

That is The East African reporting on Eritrea’s support for armed groups in the wider eastern African region. Mr. Afewerki’s actions are a threat to regional security for the following reasons:

1. Eritrea’s (opportunistic and cynically instrumental) use of Islam as a galvanizing force (against “Christian” Ethiopia) threatens to ignite a wider regional conflict that would probably include North Sudan and Egypt. The reason this is likely is because:

       (a) Remember that the use of the waters of the Nile continues to be a source of friction between Egypt and the riparian states of eastern Africa. Egypt itself has in the past been linked to armed groups in Somalia opposed to Ethiopian rule of the Ogaden region. Both countries have a history of funding rival clan militias in Somalia. In all of this the principle of my enemies’ enemies’ are my friends will most likely apply.

        (b) Because of its own problems with South Sudan, North Sudan might have an interest in using Eritrea’s networks to destabilize its southern neighbor. Recently the government of South Sudan banned all people of Somali origin from entering the country by land for security reasons. Juba clearly suspects either direct or indirect links between Khartoum and the myriad armed groups in war-torn Somalia

2. Given that the groups it supports (e.g. al-Shabaab) have other enemies besides Ethiopia, President Afewerki has effectively declared war on countries like Uganda, Burundi, South Sudan and Kenya that have also either been attacked or threatened by al-Shabaab. I wouldn’t be surprised if one or two of these EAC states decided to materially support the Ethiopian side the next time Addis and Asmara fight over their barren disputed border lands.

Quick hits

Guide to arguing on the internet (HT Lauren).

Speaking of arguing on the internet, I like the drama that is spats between economists and other academics on their respective blogs.

The Economist presents the faces of famine in the Horn. It is beyond sad that so many people should be condemned to suffer this man-made tragedy.

Brett Keller has posts here and here on Sam Childers (a.k.a. machine gun preacher), a gun-runner into the habit of doing morally and ethnically dubious things in the name of God. Keller says that Childers is “stockpiling arms at his orphanage and has admitted to selling weapons to unnamed armed factions in Sudan, Uganda, and Rwanda.”

In Zambia (where I shall be for the elections in Sept.) the politics of citizenship and belonging are yet to be settled 50 years after independence. We recently witnessed the dangers of de-legitimizing whole sections of countries as outsiders in Cote d’Ivoire. I hope that if Sata ever wins he will not do what incumbent Ivorians did to ignite a rebellion in the northern reaches of their country. For more on this check out this great book on the Ivorian collapse. I have read it and absolutely loved it.

A muddy few months ahead for the South African government. Infighting with the ANC top brass might mean an early exit for President Zuma. With over 60% of the votes in the last election, the ANC is essentially an oversize coalition prone to internal wrangles. It will be interesting to see how Zuma weathers the storm in the midst of challenges from both COSATU and Malema.

Lastly, the current issue of the Journal of African Economies looks at the impact of higher education in Africa. The main takeaway is that the low quality of education at lower levels (primary and secondary) has meant that the biggest bang for the buck on the Continent, as far as education is concerned, only comes with higher education. Too bad that many of those that get higher education are underpaid or out of the Continent all together.

Will be blogging sporadically for the next week

Dear readers, I have been away for a bit. Research/work and running the San Francisco half marathon (see images below) have kept me from blogging. I am back but will only be blogging sporadically for the next week or so.

In other news, next Thursday I head home to Kenya for a short vacation. My trip will also include brief visits to Uganda and Tanzania and an extended trip to Zambia (I will be there for the elections) before coming back to the Bay Area for year 3 of (hopefully) 5 of grad school.

Stay tuned.

Here are my marathon pictures.