Early this week, the South Africa Daily Maverickpublished an op-ed titled, “It’s not Zuma that we need protection from, it’s the market.” While the author rightly calls out the role of cronyism in destroying ordinary South Africans’ economic mobility, she doesn’t seem to make a distinction between economic freedom and crony capitalism.
This spotlights a crucial misunderstanding in the ongoing battle against capitalism in South Africa, and across Africa.The values of freedom will continue to take a back seat as anti-market forces demand more state control of the economy against “corporate” interests.
The Benefits Seem Unattainable
How is it that perceptions of the market are so negative on a continent with such a rich tradition of economic freedom?
It can be alleged that the arguments for capitalism have become too utilitarian to appeal to a continent that has been ravaged by the effects of slavery, colonialism, kleptocracy, ethnic genocide, crony capitalism, and extreme poverty. Indeed, in his 1999 book “Development as Freedom,” Harvard Professor Amartya Sen argued,
The discipline of economics has tended to move away from focusing on the value of freedoms to that of utilities, incomes, and wealth. This narrowing of focus leads to an under appreciation of the full role of the market mechanism, even though economics as a profession can hardly be accused of not praising markets enough.”
Today’s Young Voices Podcast features Young Voices Executive Director Casey Given and YV Advocate Andrew Wilford on the forthcoming release of GMO apples in select stores in the Midwest. Could the relative lack of outrage regarding these apples mean Americans are finally accepting the scientific consensus on GMOs?
In March this year, the East African Community (EAC) proposed a ban on all imported used clothing by 2019 in an attempt to revitalize local apparel industry and bolster local economies. The argument that protectionism will lead to East African industrialization has been used since at least 2004, conveniently ignoring the fact that textile factories are in trouble in the region because of corruption, insecure property rights and overall bad governance.
The anti-second hand clothing (SHC) protectionist argument has also been bolstered by the loaded language used to describe the SHC industry in Africa. Anti-trade activists speak of the “sale of Western cast-offs” and claim that all used clothing that gets to Africa is “low-grade stuff no one else wants.” This language associates the industry with shame, arguing that it perpetuates the legacy of colonialism. Yet, this language fails to acknowledge how the industry bolsters entrepreneurship. Georgetown University Professor Pietra Rivoli describes how the mitumba (used clothing) foster entrepreneurship in Tanzania:
“A drive through the large mitumba markets in Dar Es Salaam shows a level of economic activity unmatched anywhere else in the city and hundreds, perhaps thousands, of people who are very clearly working. The traders, importers, sorters, and launderers who people the mitumba trade show an astonishing variety of skills, and the tailors, in particular, are a marvel of the employment created by mitumba. Not only do the tailors adapt Americans’ clothing to African figures, they create blouses and shirts to match “new” suits, and they turn curtains into dresses, socks into bathmats, and skirts into tablecloths and tablecloths into skirts.”
The French burkini ban debate may no longer be trending, but there is an ongoing civil rightscase against the city of Chicago initiated by a Muslim woman against six police officers who unlawfully strip searched her because they thought she was a lone-wolf suicide bomber. This case has not received as much attention as it should, with most of the attention focused on the election and gun violence. However, the burkini ban and the Chicago civil rights case are symptomatic of a larger problem within the Global War on Terror. Over the last decade, a major frontier of the War on Terror has become the Muslim woman.
To be clear, this is not the first time that women have become cannon fodder in interstate or civil conflicts. The most studied way through which women become a part of the front in wars is rape, which has been deliberately used as a weapon of war in Bosnia, the Congo, Japan and Chechnya, to name a few. However, with the War on Terror, the manifestation of this problem is more subtle, and worse, is often couched in claims of female empowerment, as with the French burkini ban. In reality, this crackdown on Muslim women shows the general frustration with state failure to effectively fight terrorism. Muslim women become natural targets in trying to dominate radical Islam in order to show strength faced with an enemy who has figured out how to strike at the heart of Western civilization.
What becomes more frustrating, particularly for Western states that fall victim to terrorism, is its persistence despite its political ineffectiveness. Since the 1980s, it has been agreed that terrorism is ineffective. In fact, the Rand Corporation found that “terrorists have been unable to translate the consequences of terrorism into concrete political gains.” In that sense terrorism has been fundamentally a failure. How, then, does a state combat an enduring threat that is neither deterred by failure nor law and whose “root causes” are not discernible?
The American Congress recently passed the bipartisan Global Food Security Act, a $7 billion dollar project aimed at bolstering efforts to end hunger, malnutrition and poverty across the globe. Sounds noble, but this Act will most certainly not improve global food security, especially in Africa, because it fails to address a fundamental cause of food insecurity in the developing world: US agricultural subsidies.
If President Obama really wants to fix world hunger, he’d do well to truly liberalize American agriculture by removing subsidies for wealthy farmers. It has been well documented by the United Nations, the World Trade Organization, and numerous experts that subsidies go against the principles of free trade. They lead to “international dumping” – where products from developed countries are sold to consumers in developing countries at unfairly low prices that force out domestic producers.
Extensive economic studies show that it is wealthy farmers who benefit from subsidies, not poor ones.
As the global economic order currently stands, African farmers – and their governments – cannot compete with billions worth of American protectionism on essential crops such as tobacco, cotton, corn and rice. Since the 1950s, the IMF and World bank mandated that African governments liberalize their economies with Structural Adjustment Policies in order to qualify for loans. As a result, many of these countries can neither afford to subsidize their own farmers, nor can they put import duties on foreign produce. In other words, they simply cannot stand a chance on the global marketplace.