Where is Zimbabwe’s own George Soros?

LET me put the reader at ease. I am neither an economist nor a scholar. I never studied economics and have never done research on anything useful. I cannot recite John Maynard Keynes or Milton Friedman’s great theories which rule our daily lives.

That is my only interest, that old and foreign economic theories rule our lives, and we are completely enthralled to them as developing nations. Our own “scholars” and “economists” can do no more than regurgitate this received wisdom even when history has repeatedly shown through cyclical crises that these theories are not from the tablet of stone Moses received on Mt Sinai. At best, they are a crude guide for policy-makers to make sense of a cluttered world.

What got me thinking was a small story with far-reaching implications in the UK Sunday Times of April 11, 2010. Following the global financial crisis which blew up in 2007, the paper reported “a galaxy of academic economists” and policy-makers will gather at King’s College, Cambridge, to launch the Institute for New Economic Thinking.

“Their purpose,” said the Sunday Times, “will be to reopen many of the debates closed down by unrealistic theories based on assumptions of rational and efficient markets. These concepts became increasingly dominant from the 1980s and gradually acquired a virtual monopoly on senior university appointments and research funding. This intellectual monopoly has ended up not just crushing the competition but also destroying itself from within.”

I think it takes great men to challenge theories which over the years have acquired the authority of scientific truth. More than that, what I found interesting was that these men live in societies where you can experiment and research. I particularly like the positive mindset, people who believe in themselves and are ready to declare: “Yes, we can!”

George Soros has provided seed money of US$50 million for the Institute. Other donors have pledged equal amounts to set up similar institutes at leading universities in Britain and the US.

The situation is different in Africa, and in Zimbabwe in particular. Theories and prescriptions which have failed elsewhere are adopted wholesale in the name of the “open market” even when these lead to “global” financial crises. In 1991, Zimbabwe was forced to adopt the disastrous Economic Structural Adjustment Programme (Esap). Although it had failed everywhere, it was imposed by the IMF. Our “economists” insisted where Esap failed it was because of corruption or incompetence.

When it was proved that it was not working in Zimbabwe given the mass retrenchments, we were told no, the government was not pursuing it whole-heartedly, meaning it was not privatising fast enough, it was not allowing “market forces” to take care of prices and labour relations and the public service was not retrenching enough people for Esap to work.

Former British Prime Minister Baroness Margaret Thatcher was fondly cited to push for more austerity measures: “If it doesn’t hurt, it’s not working.” Pain was an essential part of the cure, said the Iron Lady of British politics.

My point is that we were ready to experiment with Esap. Those who disagreed were communists or stupid bureaucrats who refused to “think outside the box”.

It is only in recent years that “economists” have begun to question the efficacy of Structural Adjustment Programmes in Africa and beyond, together with other experiments. You would expect then our own economists to be more adventurous in searching for alternative approaches to fighting poverty and reducing unemployment. The land reform is one such daring alternative.

Instead, everybody is in retreat. It was a “failure” from the start. There shouldn’t have been pain. If it hurts, it’s not working. There is no need for austerity measures! The slogan has been insistent and loud: “No, we can’t. Nothing home-grown ever works. You cannot experiment with people’s lives.”

The inclusive government was met with the same fervent cynicism. It was a stillbirth. It could not be allowed a life, even one as short as two years! Since its inauguration in February 2009, no effort has been too daunting to demonstrate how it will never work. Esap was initially given five years despite its catastrophic death toll.

Now this self-denial has become a culture with huge sponsorship from outside the border. Indigenisation has become the latest victim. Instead of money being invested in hosting seminars to debate and remove the loopholes in the Indigenisation and Economic Empowerment Act, there is more than enough if only to show that it can never work.

Seminars organised by Human Resources people are dominated by those who tell us all the bad about black empowerment but don’t have a single original idea why this is bad, except repeating stereotypical bogeys about investor flight, property rights and racism, the same voices which told us more jobs had to be lost for Esap to work.

The majority who stand to benefit if they can access resources to buy shares in the big conglomerates are labelled the lunatic fringe. No one wants to “think outside the box” on indigenisation, just as no-one dared on the land reform.

What is disheartening is that Zimbabwe’s own sons and daughters are at the very best timid, at worst accomplices against their own. If we were prepared to experiment with Esap which had failed everywhere on the continent, why is it considered such a huge risk to experiment with the land reform and indigenisation which have never been pursued with the same zeal and vigour we were exhorted to apply to Esap? Are we supposed to be diligent only when trying alien concepts but never our own?

Indigenisation is not based on jambanja. Companies have five years to fully comply. All shares must be paid for; there is no looting as suggested by some media. What is the cause for the hysterical objections to indigenisation? The single most valid plea should, perhaps, seek to raise the threshold for minimum assets from US$500,000. Besides, nothing in that Act is cast in stone if objections are raised in good faith, not to block the programme as happened with the land reform.

When shall Zimbabwe get its own George Soros to sponsor seminars on new economic thinking to tell us more about how an equitable land reform and indigenisation as forms of black empowerment have the greatest potential for durable peace than any number of jobs which can be created by foreign investors now said to be sitting on the fence or already running away?

Zimbabwe is crying out for its own Institute for New Economic Thinking to propose alternatives to imported conventional wisdom. This should not in any way be construed to propose self-isolation for Zimbabwe. It is simply to say we need to lay a firm foundation of economic ownership for ourselves before we venture into the fickle world of international capital.

The “global” financial crisis has shown us that no system is foolproof. Let’s not be afraid to learn from our mistakes and to celebrate our little successes with black economic empowerment so far. Europe and the US have read the mistakes of the current financial architecture and are seeking alternatives. Where are our own sponsors and researchers to inform the new thinking on future economic and political discourses? Zimbabwe is not poor. Our entrepreneurs must work to create the environment in which they would be happy to invest!

Joram Nyathi is Jomic communications manager. He writes here in his personal capacity and his views have nothing to do with Jomic