Saturday, June 19, 2010

The Shackled Continent (Part VI)...My Take and Charter Cities

My Take

The Shackled Continent did exactly what it promised; it unraveled Africa’s web of complicated problems.  This book was readable, descriptive, pragmatic, and genuinely sympathetic.  

What I liked.  Guest is a passionate hard-nosed capitalist; so many of his ideas resonated with my understanding of Africa.   He believes that “thugocracies” of many African countries have restrained the entrepreneurial talents of Africans.  And that Africans have largely been impoverished by their own leaders.  Guest goes on to say in regards to colonialism, 

Foreigners sometimes really are to blame. Africans have suffered, and its only natural that many should bear grudges for the wrongs of the colonial period....but railing against outsiders may be cathartic, but it dose not achieve much.  Wiser Africans do not wish to be seen as victims.  

Guest squarely puts the responsibility for Africa to succeed upon its leaders.      

What I didn’t like.  Guest doesn’t give much advice in regards to solutions for African leaders to adopt.  After reading the conclusion “One Step At A TIme,” I was left wanting more than Africa should look to the country of South Africa as a model of success and follow its lead little by little.  Why should we believe anything will change when it has always been this way.   

I also disagreed with Guest’s negative opinion of foreign aid to Africa. I think he fails to make a differentiation between government aid (which is largely inefficient...The value of “dead capital” in poor countries--that is, property which cannot be capitalized because of the lack of a title deed - is roughly forty times the foreign aid received by the world since 1945) and aid privately directed to NGO’s or mission agencies.  I’m biased and of course believe in what we are doing here at Kijabe.  And I see how the lives of people and communities are changed not just by the physical care they are given, but also by the transforming power of the Gospel.  Guest is wrong to denounce all aid as counterproductive.

What are the best minds saying?  Are there any other solutions?

Charter Cities; A Creative Solution

Paul Romer an economist from Stanford is trying to help the poorest countries become rich.  His ideas (written by Sebastian Mallaby) whether you agree or disagree are worth reading.  


Romer is peddling a radical vision: that dysfunctional nations can kick-start their own development by creating new cities with new rules...centers of progress that Romer calls “charter cities.” By building urban oases of technocratic sanity, struggling nations could attract investment and jobs; private capital would flood in and foreign aid would not be needed. And since Henry the Lion is not on hand to establish these new cities, Romer looks to the chief source of legitimate coercion that exists today—the governments that preside over the world’s more successful countries. To launch new charter cities, he says, poor countries should lease chunks of territory to enlightened foreign powers, which would take charge as though presiding over some imperial protectorate.

To drive home the importance of good rules to economic growth, Romer sometimes shows a photograph of Guinean teenagers doing their homework under streetlights. The line of hunched, concentrating figures presents a mystery, Romer says; from the photo it is clear that the teens are not dirt poor, and youths like these generally own cell phones. Yet they evidently have no electric light at home, or they would not be studying by the curbside. “So here is the puzzle,” Romer declares: Why do these kids have access to a cutting-edge technology like the cell phone, but not to a 100-year-old technology for generating electric light in the home? The answer, in a word, is rules. Because of misguided price controls in the teenagers’ country, the local electricity utility has no incentive to connect their houses to the power grid. Their society lacks the rules that make technological advance meaningful.

The standard response to this obstacle is to advocate democracy and hope that voters will force change: the minority that has electric light will be outvoted by the much larger number of people who have been denied it. But Romer argues that this way forward is too slow. People don’t always vote their economic interests, and elites with tentacles all over the ministry of energy may keep price controls in place for decades. So rather than wait in vain for electricity rules to change, we are better off starting a new experiment with brand-new rules—a charter city that stands outside the ministry’s authority.

Reviewing this book on one hand was discouraging and overwhelming, but also kept me mindful of  the world's utter dependence upon God in the face of Africa's mighty obstacles.  

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