Residents of Webuye West in the southwest of Kenya did this:
Residents of Webuye West in the southwest of Kenya did this:
President Jacob Zuma continues to be in conflict with his own Finance Minister, Pravin Gordham, over fiscal policy (and propriety in the management of public finances). The markets trust the latter. The former has more power, including the coercive apparatus of South Africa’s administrative state. Having just presided over a disastrous outing for the ruling ANC in this month’s municipal elections, Zuma needs to create more policy wiggle room for his floundering administration. And Gordham’s commitment to fiscal discipline stands in the way. So far the markets’ reaction to Zuma’s machinations at the Finance Ministry have managed to discipline intra-ANC elite politics. But as Zuma gets closer to retirement (or being forced out) it is unclear how much he is willing to continue humoring the markets…
The revelation on Tuesday that Gordham may be forced out via (likely dubious) charges of improper conduct while he served as head of the South African Revenue Service sent the rand tumbling, again.
This is the third time the police unit, known as the Hawks, have questioned Gordhan. Earlier this year, just days before he was set to deliver a crucial budget speech, the Hawks demanded Gordhan answer written questions. Then in May, rumors of Gordhan’s imminent arrest sent the currency tumbling, just as ratings agencies were assessing South Africa. Gordhan was not arrested then, and went on lead South Africa’s recent economic recovery, assuring international investors of the country’s stability.
Analysts believe Gordhan is the target of president Jacob Zuma and his political allies. The two are reported to be at loggerheads over the management of South Africa’s state-owned enterprises, especially the national carrier South African Airways. Gordhan’s office has delayed bailing out the embattled carrier until a new board is appointed (effectively removing those close to Zuma, according to reports). Gordhan’s office has also curbed spending on plans to build a new nuclear power plant.
Earlier this week, a cabinet briefing announced that Zuma himself would now directly oversee state-owned companies. Analysts say the move allows Zuma to maintain political power and protect his interests after historic losses in this month’s local government elections. Zuma’s office has denied that there is a rift between the president and the finance minister. According to reports, Gordhan is determined to resist pressure to resign
For more on this visit Quartz Africa:
This is from Alex Tabarrok over at MR:
Our focus on prisons over police may be crazy but it is consistent with what I called Gary Becker’s Greatest Mistake, the idea that an optimal punishment system combines a low probability of being punished with a harsh punishment if caught. That theory runs counter to what I have called the good parenting theory of punishment in which optimal punishments are quick, clear, and consistent and because of that, need not be harsh.
We need to change what it means to be “tough on crime.” Instead of longer sentences let’s make “tough on crime” mean increasing the probability of capture for those who commit crimes.
In my public policy class this semester we read the sad story of Thabo Mbeki’s capture by “dissident” scientists who sold him unconventional policy approaches to South Africa’s AIDS epidemic. The lesson was that we should always be wary of allowing experts too much leeway in deciding actual policy. This means more debate (both among experts and by the public) and routine rigorous evaluation to strengthen the quality of feedback after policy rollouts.
Social Science is awesome. And may the credibility revolution live on. But the world certainly needs more humble social scientists.
Back in 1972 Stanford psychologist Walter Mischel conducted experiments in which he claimed to show a correlation between patience and later success in life – in the experiment kids who could wait for 15 minutes before getting two marshmallows, instead of eating one immediately, were likely to be more successful and self-controlled later in life. Michel attributed patience and self-control to some of the kids’ innate capacities.
It turns out that that might not be the case after all. Researchers in Rochester revisited the experiment and show that kids’ choices over whether to wait or not are “moderated by beliefs about environmental reliability,” in other words, kids react rationally to the proposed deal based on prior experience.
According to Celeste Kidd (more on this here), a University of Rochester grad student and lead author on the study:
“Being able to delay gratification — in this case to wait 15 difficult minutes to earn a second marshmallow — not only reflects a child’s capacity for self-control, it also reflects their belief about the practicality of waiting,”
“Delaying gratification is only the rational choice if the child believes a second marshmallow is likely to be delivered after a reasonably short delay.”
This reminded me of the interesting works in economic history (gated, sorry) that try to tackle issues of culture and socialization and their role in economic development. The punchline from these works is that group-specific socio-cultural values have long-lasting effects on attitudes towards investment, saving, entrepreneurship and ultimately economic development (Think of the fabled frugality and self-discipline of Weber’s protestants). Putting some of the critiques of these works aside for a moment, they are a reminder of just how COMPLEX development is.
Because material conditions both shape and are a result of prevailing cultural norms and practices (both Marx and Weber were right!) it becomes difficult to change one thing while ignoring the other (And this is even before you open the pandora’s box, viz: POLITICS). To put it simply, you cannot increase the investment rate in a society simply by throwing money at people. They will spend it on a new shrine for their god or marry a third wife.
This is not to say that it is impossible to transform entire societies in a short while, just that it is not easy, and that we should be humble enough to accept this fact when thinking about how to promote economic development in the bottom billion societies of the world.
I just attended a discussion session with Stanford scholars Lisa Blaydes (Political Scientist) and Joel Beinin (Historian) on the recent uprising in Egypt.
The structural factors leading to the revolt (According to Prof. Beinin) include: High unemployment among the youth, who constitute a big percentage of the working population and neo-liberal economics, embodied in the “government of businessmen” with friends and cronies of Gamal Mubarak at the helm.
The other point highlighted by Prof. Beinin is that the revolt has its roots in the liberal autocratic equilibrium that had emerged in Egypt over the last decade or so. Groups were allowed to protest, strike or engage in other collective action activities.
Prof. Bienin also took issue with American portrayal of Mubarak as a “moderate authoritarian,” the idea that Suleiman (Vice President of Egypt) should lead the transition and the perception of the Muslim Brotherhood as radical Islamist movement with a stranglehold on Egyptian politics – there are other opposition movements that would force the group to moderate its politics.
Prof. Blaydes’ talk aimed at answering three questions: who is protesting and why, what should we expect from free elections in Egypt and what does this all mean for Egyptian-American relations?
The protesters are likely to be mostly upper middle class men. A survey (rep. sample of 3000) before the protest indicated that only 8% of the total; 12% of men; 50% of the engaged upper middle class would go out and protest. The revolt is not a movement of the poor wanting redistribution. It is a middle class affair.
Egyptian politics is not a programmatic issue-based enterprise. Patronage politics predominate. Prof. Blaydes presented findings form survey data to estimate the strength of political Islamist movements in Egypt. The possible upper-bound of these movements was estimated to be 60%. Egypt has one of the largest concentrations of right-wing Islamists in the Arab world. The key point here is that there are a lot of unknowns. Since patronage politics predominates it is unclear if the high religiosity of Egyptians will necessarily translate into political gains for the Muslim brotherhood.
Public opinion in Egypt is already highly anti-American. US actions are unlikely to change that in the short-run, especially given the apparent American support for the Mubarak regime in the last few days.
Overall it appears that the uprising will not meet the needs of most pro-democracy groups. The ancien regime has dug in and appears to be regrouping.
Kenya’s newly emboldened
imperial parliament is up to some mischief. MPs rejected nominees to two crucial commissions created by the country’s new constitution: the Revenues Allocation Commission and the Commission for the Implementation of the New Constitution. The MPs rejected the nominees to the two commissions in response to a court decision that ordered the boundaries commission not to gazette newly created parliamentary constituencies. Their mischievous excuse was that the commissions lacked regional balance.
Pols from central Kenya went to court challenging how the redistricting was done. Many of them thought that the boundaries commission favored ODM, the Premier’s party. MPs from the western half of the country, the northeast and the coastal region seem to be OK with the list. I still do not understand how in the world anyone thought that redistricting of constituencies would be apolitical. [Despite the existence of a formula in the constitution].
I am always amazed by the naivete and lack of strategy among Kenyan politicians who seem to think that public officials always have the best of intentions – never mind the fact that the country is one of the most corrupt in the world. Given the outcome, Mr. Ligale and his commissioners must have been in the pockets of ODM. The losers should learn from this and in the future design more airtight systems that assume the worst of public officials. No country has ever succeeded whose institutions depended on human goodwill.
As a result, a crucial deadline has been missed in the implementation of the new constitution and any Kenyan can go to court demanding the dissolution of parliament.
Lawyers, however, refute the notion that Kenya is in a constitutional crisis. There are ways around the matter. Firstly, the MPs can amend the constitution to give themselves more time. Secondly, the judiciary can give the boundaries commission a new lease of life and extend its mandate until the job is done. Lastly, and perhaps most plausibly, the President and his Premier can arrive at a political solution to the problem and allow the process of implementing the new constitution to move on.
And in other news, Kenya’s Prime Minister Raila Odinga has very bad advisers. Asking that gays be arrested is so 16th century. In any case the last thing we want to do is waste critical police man hours policing private morality while criminal gangs continue to make the lives of many Kenyans a living hell. Mr. Odinga should know better.
update: For a history of the CAR read this: History of CAR
The Central African Republic (CAR) is perhaps the biggest joke as far as states within the international system go. Francois Bozize, the Gabon-born dictator that currently runs it, has failed to meet even the barest of needs of his countrymen. The IRIN reports:
“There is plenty of fertile land in the region [south east of CAR] but violence is interfering with traditional ways of life such as agriculture, hunting and fishing, with farmers often afraid to stray far from town to work their fields for fear of attack. This has reduced production, pushing up prices to the point at which not everyone can afford to buy food, even when it’s available,” said Christa Utiger, the International Committee of the Red Cross (ICRC) economic security coordinator for the CAR.
4.8 million people live in the country. A person born in the CAR can expect to live to be 50. The literacy rate is a woeful 49%. Per capita income (PPP) is US$ 700 (yes, PPP). Gold and timber are the main export earners, with the vast majority of people living on subsistence agriculture. 16% of CAR’s children under 5 are acutely malnourished. Rebel groups, including Uganda’s Lord’s Resistance Army routinely use CAR’s territory as launching bases. The only people who appear to be benefiting from the existence of CAR as a country are the thugs who run it, from David Dacko, to the self-proclaimed Emperor Bokassa to Francois Bozize.
An ambitious project is in the works to build a new city from scratch in Kenya, a sign that things are indeed changing in the economic engine of the wider eastern African region. The stock market voted for the new constitution with a bullish run on the eve of the ratification of the document. Investments in property – the property class has outdone most asset classes in the last two years – serve as a sure marker that Kenyans are confident in government’s commitment to protection of property rights. I am one of those who remain optimistic that Kenya is on the verge of take-off. And here is why.
Not long ago the idea of a cabinet minister resigning in Kenya was a pipe dream. Even more improbable was the idea of parliament defying the president. But these days ministers resign and the Kenyan parliament routinely defies State House. More importantly, the august house has continued its march towards independence from the executive – both functionally and financially. By controlling their own budget and calendar and building a functioning committee system, members of The House have acquired enough muscle to expose lapses in the management of public affairs – including the present scandals involving the Kenyan foreign ministry and the Nairobi City Council.
The biggest question, however, is whether the reforms embodied in the new constitution will last. My answer is yes they will, for two reasons. Firstly, the reforms are not as radical as some commentators think they are. The Kenyan establishment still stands to gain the most from the institutional reforms embodied in the new constitution. Land ownership, taxation, regulation of business, among other topics of interest to the elite are still firmly in the hands of the conservative centre and their provincial allies. Secondly, the emerging culture of bargaining, as opposed to Nyayo era “wapende wasipende (like or not) politics,” provides opportunities for amicable settlement of disputes resulting in self-reinforcing deals. No single political grouping can force its will on Kenyans. Mr. Kenyatta needed to only convince the Kiambu mafia for his policies to fly. Moi only needed a small group of collaborators. The new dispensation, however, requires that a significant number of elites, with varied political interests, buy into an idea before it can fly. This is progress. It is stable and sustainable progress.
Kenya’s dark hour in early 2008 was an eye-opener to the political and economic elite. The more than 1300 deaths will forever be a reminder of the evils of strongman rule. The broader legacy of the 2007 election will however be positive. The elections showed the core conservative establishment that they cannot run the country on their own, and that the peripheral elites also have significant de facto political power. By forcing the elite into agreeing to a self-enforcing arrangement, the regrettable events of 2007-08 facilitated elite compromises culminating in their new Kenyan constitution. The yet to be established supreme court will provide the final piece of the foundation needed for sustained institutional development in a predictable environment. Paradoxically, the biggest plus of Kenya’s new constitution is its conservative bent. And for that reason it will endure beyond the current teething phase. A more radical document would have been eviscerated just as the Kenyatta and Mboya amendments decimated Kenya’s independence constitution.
I am in the middle of writing a piece contrasting a subset of African and non-African dictatorships over the last half century. As most of you might know, quite a number of African countries have been mournfully commemorating celebrating 50 years of independence from European empires. Many of them, including the behemoth and perennial under-achiever that is Nigeria, have almost nothing to show for over half a century of self-rule. Disease, endemic poverty, general political and socio-economic stuntedness are what come to mind when one thinks of these places, and with good reason. Look at the latest UN HDI report if you think that Africa’s bad press is nothing but unfair afro-pessimism.
And keeping with the theme of development, here is a blog post that I really liked about Botswana, a country that many like to cite as Africa’s success story.
Lastly, a brief lesson on the Political Economy of Development.
The last time I had free wireless at an airport was in Hartford, Connecticut. I am therefore absolutely delighted to be able to blog as I wait for my flight to London tonight. I am not looking forward to the long hours in pressurized steel tubes – as one of my pals calls them – and the long layover in the infamous Heathrow. Although there is no chance of missing my connecting flight to San Francisco, I am bracing myself for the possibility of not having my luggage when I arrive there.
Already missing home. It has been a fun one month, most of which I spent in rural Kenya. Being in Nairobi has been fun too. I am glad I got to be here for the referendum, the promulgation of the new constitution and the release of the 2009 national census results. Kenya is a lot of things, but lately it has been trying tooth and nail to put its best foot forward, the al-Bashir fiasco notwithstanding (I am one of those optimists who are hoping that Kenya was playing smart diplomacy by allowing the genocidaire president to come here in exchange of his honoring the January 9th secession referendum for Southern Sudan).