Some observers even dared to say that we almost celebrated our depressed condition with the same pomp, pageantry and even puffed up, foppish, arrogance of the giant of Africa our leaders have come to be
known for.
Trying to understand the paradox of this uncanny spectacle of celebrating decline suggests a few fundamentals are out of place. I had a troubled evening reflecting on this. The idea of why nations are poor has been an intriguing and somewhat consuming matter for me. In the challenging task of trying to find meaning, I have tried to engage with the literature on this subject and to walk the backstreets of many poor countries as I travel the globe, always struggling to match what I encounter with my experiences on the high streets of Europe, North America, and particularly the East Asian countries that have swam against the currents 50 years of failure by academics and statesmen around the world trying to find the solution to the growth and development puzzle.
Those who have subjected themselves to the boredom of reading my frustrations on this subject, either in popular commentary or my academic writing, will probably know that for some time my prime concern has been with what I call economistic growth models that reduce solutions of man's material advance to economic policy choice. I have therefore continued to push my own framework which considers the role of institutions, human capital, entrepreneurship, leadership and culture critical parts of the mix along the policy choice if sustainable development is to take place. I have, however, continued to profit from, be amused by, and bewildered by the array of prescriptions on why we have not managed to escape poverty.
From the titillating, graphic, descriptions in Robert Kiltgaad's Tropical Gangsters, to grand perspectives on why Africa has grown slowly by Jeffrey Sachs and friends, on one hand, and Paul Collier and partners, on the other hand, I have come to the simple conclusion that the missing primer in development economics is actually located not in that discipline but in theology. Before you wonder that I am about to invite more people to the Aso rock Presidential Villa for more fervent morning devotional prayers, hold your fire and we shall return to the matter. Let us deal with the economics first.
Whether we take the view that Jeffrey Sachs is fishing for alibis for African Leaders by taking the so called destiny perspective that locates Africa's slow growth in misfortune of geographic location, or the views that ridicule these leaders who are characterized as kleptomaniacs and incompetents, in the question of who is held responsible for this lack of progress, you can not but respect an economist who is humble enough to name himself and his colleagues for wrong prescriptions. Not long ago I encountered the thoughts of one such economist that believes some tropical misadventures of economists have left Africa longer in the wilderness than the people of Israel are believed to have wondered, with and without Moses. William Easterly, a long time world economist
does this in the book: The Elusive Quest for Growth: Economists Adventures and Misadventures in the Tropics.
It is not just the humility of William Easterly that makes his book such a compelling reading. Besides its depth and ease of reading, the book tries to find the missing primer. Why have we got it wrong for so long; at the world bank, in the academic community and as Statesmen dolling out development aid which fast fingered African leaders promptly return to banks in Europe and America in accounts that bear the names of their girlfriends and fronts. For Easterly, Economists working on development abandoned the very fundamentals of the discipline as incentives. People respond to what you pay them to do. He is right about incentives. However, how we see motivation, I am told by those who know better, has moved on from Abraham Maslow. My real point is that the true primer I gleaned from Easterly is not so much his intended primer on incentives but on how much we need humility to explain mysteries. This is why I say theology is where the solution lies.
The mystery of the failure of development can be seen in how assiduously International Financial Institutions pursued unproved and disproved models. A classic example is the long held believe that the key to development was in bridging the financial gap between savings in the economy and the investment required to attain a certain growth rate. Easterly ascribes that tradition to the Harrod-Domar model. Even though Professor Evsey Domar had published an article acknowledging that the growth model offered in his 1957 book was flawed many economists continued to make that the basis of arrogant prescriptions to third world leaders, decades after. I still recall Gen. Oluleye going off in search of the Jumbo loan when Nigeria was said to be under-borrowed at height of the first Oil boom. That turned out to be our path to the debt trap for which he man then in charge is now flying around in search for debtforgiveness. The main beneficiaries now seem to be Western banks trying to recycle petro-dollars.
The question you may ask us is, if humility in recognizing that we are not dealing with an exact science is valuable, how can a person convincingly advance a point of view he feels is right As a proselytiser of many ideas myself, including ideas in this area of human material advance, I see the value in being humble about your point of view. Humility comes in allowing expression and consideration of other perspectives, because, just because there is a small chance you could be wrong and others right. Seeing the other point of view does not mean you cannot be passionate about yours. Indeed the passion is what may make a perspective that which produces desired outcomes. In business strategy that humility is seen in the acknowledgement that there is no one sure path to success. Some fundamentals must be in place but passion is what makes the ultimate difference. I fear that part of the reason nation's are poor is the tendency for a monopoly of wisdom in experts and leaders. Part of the effect in Nigeria is inoculation from the kind of shock the Human Development Report should have generated creating a level of passion to change things that we seem so unable to muster. Humility and passion for change are therefore more like the primers we could put the experts and leaders through.
Nation building can learn much from corporate victories even though the charge of fallacy of composition is quick to come when one goes to the macro with micro models, in Economics. I have no doubt that many lessons can be transferred. Two striking lesson regarding humility and passion to me come from Malaysia at the height of the Asian financial crisis in 1997. Thanks to the Malaysian High Commission in Lagos. I had more than ample opportunity to speak with officials of Bank Negara Malaysia in October that year. They were humble to admit the error in their over-confidence when they said Malaysian slipping into current account deficits because portfolio money was pouring in. Once George Soros spotted this and knew inflationary consequences lay ahead, he took a speculative position against the Ringit. The Malaysian government while humble enough to recognise this error trusted in its own model enough to reject the IMF path offered Indonesian. We would see the differing outcomes.
Given this, it is not surprising that I would go to Berlin a few weeks ago to a conference on the curse of Oil and not see oil producing Malaysia or that I would be in Barcelona last week and the concern would be with what is now elegantly called the base of the pyramid (BOP); the poorest of the poor, like Nigeria. It's all a matter of the humility of its leaders and experts.
Utomi is of the Lagos Business School
