Verdict: Capitalism is good but are we?
We often hear that money is the source of all evil. But money, as a product of the modern economy is an exchange tool that only facilitates for transactions undertaken by people and can only be controlled through the actions of these people, for whom it is meant to serve. If these people are truly and only motivated by money, then it [money], almost certainly, will end up being very 'evil'.
We often hear that money is the source of all evil. But money, as a product of the modern economy is an exchange tool that only facilitates for transactions undertaken by people and can only be controlled through the actions of these people, for whom it is meant to serve. If these people are truly and only motivated by money, then it [money], almost certainly, will end up being very ‘evil’.
It is for this very reason that capitalism is or at least was misunderstood, especially by people and nations that technically don’t ‘understand’ money enough to be able to contain it from its evil tendencies. Capitalism, as an economic system, puts emphasis on the role of profit and private sector ownership in driving the economy. This profit orientation has created the impression that it [capitalism] serves one master only and that master is none other than money.
Obama, President of the world’s most formidable endorser of democracy and capitalism, lands in Tanzania, but how much do we understand about America’s brand of capitalism for this trip to have real meaning for us? America is a very telling example of how capitalism can be quite illusive if not properly understood. Point being what you see is not always what it takes to get it (ukiona vimeelea ujue vimeundwa). America participated actively in the industrial revolution and went through a great deal to tame, if not understand, this wild beast called capitalism to get it to the state we see it in now. Capitalism in its wildest form promoted slavery, child labor and other exploitative methods of productivity all in the name of money, more money and even more money than that. So, rightfully, the first and most critical benefit America gained from undergoing such a process is a thorough understanding of money and its limits as an economic tool. With industrialization and the unionization that ensued with it, the broad bottom of society gained significant leverage in what was at first a system that favored the elite who created it.
The value for hard work as the basis for one to earn their keep and the fear of God as the only true master were characteristic of this predominantly blue collar class and informed the values that continue to line the fabric of this great Nation called the USA, especially when it comes to matters of money. These learnings have added volumes to the way the people factor is valued, not only in industry, but in society at large; giving credence to such notions as people’s welfare in production and participation in ownership. In turn, most large corporations in the USA are judged today not just on their ability to generate profit but even how these profits are generated and the overall impact that this has on people and the environment. Most large corporations are also publicly listed with public accountability to millions of voting citizens which has become the standard for how business is done in any robust capitalist economy that seeks to be sustainable.
Unfortunately countries like ours that have not gone this ‘industrial revolution’ route, do not always demonstrate an understanding of money beyond what it does. We are amazed, if not eluded, by the symbols of money or wealth without really appreciating the values that drive this wealth generation. A colleague of mine recently touted, in a conversation we had, about Tanzanian ‘exceptionalism’ when it comes to Nation building. The argument being that Tanzania has succeeded to build a nation when compared to other Nation States in Africa and beyond that have built most of everything but a Nation to house them in. What is the value of buying great furniture if you have no house to put them in? I would argue that Nyerere’s people centered development approach is core to this noble distinction. But in that same space, we still seem to always be hanging on a limb because Nyerere may have not fully understood money and its biggest advocate, capitalism, enough, to be able to use them to his advantage. Consequently, Nyerere frowned on capitalism going as far as to propagate Ujamaa, his unique brand of socialism. Yet his era, unknowingly, invested in a form of economic management that proved to be more destructive, where productivity and profitability were rendered through government owned entities in the guise of ‘public’ ownership but run by few system elitists without much accountability to the public for which ownership is claimed. This system failed simply because it depended too much on the good intentions of these few people as opposed to a self sustaining system. That said if this system made Tanzania an exception when it came to Nation building, then it was an evil that we would rather have had.
We have since embraced capitalism, pretty much like most of the world, but how far have we come in embracing the values that underscore a sustainable capitalist system like that of the USA is still very suspect. Most corporations in Tanzania are not listed and run without much public accountability and even the ones that are publicly owned do not have ‘real’ accountability to the public. And now we are challenged by the fact that, as a people, we increasingly value money more than we technically value people. The emergence of the large corporation, a concept that is quite foreign to Tanzania, especially in the minerals and energy sector, requires a paradigm shift in our thinking in how we engage the corporate world as a country going forward. Their size, sophistication and profit agenda can be intimidating even for the most seasoned politicians if not ‘tamed’. This prompts me to reflect on the wisdom that informed the decision to reserve shares for public listing from parastatal firms that were privatized for purchase by the public as a way of ensuring participation of a broader base in the process of wealth creation. If large corporations are vilified for serving the interest of their owners then isn’t it only logical to have more of our peoples interests represented through ownership?
Tanzania’s ‘exceptionalism’ is without a doubt a function of our Nation’s choice to promote and focus on the values of this ‘blue collar’ segment in its formative stages; the broad bottom was clearly central to Nyereres agenda. This helped this Nation forge values that others had to sweat blood to earn. Now, in this ‘Money First’ era, Tanzania comes face to face with the evil it for so long tried to suppress, but does it have what it takes to manage through? To a large extent I think YES it does! The spirit of this Nation is in the right place and its fighting hard to stay there. We can no longer afford to fear money. We need to invest in actively getting people to understand money and there is no better way to do this than to encourage them to participate through share interest. And by doing so these people will give our large corporations the much needed conscience required to remember that in as much as money matters, how that money is generated matters more.
Capitalism, in general, is a great tool for promotion of economic growth and prosperity but it needs extremely humane governance to ensure people ‘centricity’ in the development agenda. When people talk about Millenium Development Goals post 2015 and a more inclusive agenda that doesn’t mask development behind simple economic statistics, I feel that Nyerere would have been proud in this dramatic shift in capitalist thinking towards his Ujamaa.
If all the pomp and frenzy around the arrival of Barrack Obama is not telling enough of the fact that the USA is the world’s super power and will continue to be so for quite a while, then the following may:
The USA has the most sophisticated and advanced democratic governing system in the world giving it much needed internal political resilience and stability. Rome collapsed because it was so busy trying to rule the world that it forgot its domestic obligations. This system coupled with an all inclusive social security system ensures that everyone is formally known to and part of the ‘system’; further adding to its resilience.
The USA is no longer the USA. Through economic and cultural imperialism, the USA has done almost effortlessly what old Europe did by force in the colonial era; with its currency, retail franchises, lifestyle, movies and music being consumed daily across the planet. We are all more American than we think if you use our tastes and beliefs as a measure.
Creativity and innovation is a way of life in the USA. The USA may no longer be the world leader in producing science graduates but it still leads the pack in using using them to stay on the cutting edge in innovation. Creativity is the most critical differentiator in business and the USA has managed to make creativity a staple in every industry including one of its oldest – politics.
The changing rules of economics. The USA seems to always be teetering on the brink of bankruptcy generating heated concern over its ability to man the world. But a new school of thought puts its money on credit being the new cash (it is argued that money is credit even in its cash form). And given the way financial institutions, creators of money are so tied up globally, I may be an early convert into this school of thought; bye-bye Keynes! So the USA, even on this index, which seems to be where it is losing the most momentum, may still have a fighting chance.
