Another cause of Malawi’s poverty

 

Recently, a young student of journalism visited me at the office of Aggrey Memorial School and sought my opinion as to which performed better economically, the Kamuzu dictatorship era and the multiparty era. I told her that the first 20 years of the Kamuzu era ushered into the country more development than the first 20 years of multiparty. “Would we not be better off if we reintroduced dictatorship and got things moving in the right direction?” she asked.

A drowning man in a river sometimes seizes the tails of a crocodile thinking it is a canoe. No matter how bad things are at present, dictatorship is not the answer. The people of Italy in the 1920s turned to Benito Mussolini and the people of Germany turned to Adolf Hitler in the 1930s to impose their styles of leadership on them in exchange for law, order and prosperity. They got more than the desired jobs and prosperity.

The present scenario in Malawi is not conducive to accelerated economic growth because, among others, the power of rent-seekers. Rent seeking is a term that has recently come into vogue among economists possibly coined out of David Ricardo’s theory of rent earnings. It means earning extra without rendering services mostly through lobbying and corruption. This is what is going on in Malawi.

At present in Malawi, we do not see in our bookshops quality magazines from the United Kingdom and the United States such as we used to have during the Kamuzu era. What a pity. Neither politicians, the bureaucrats nor the citizenry seem to be well-informed about what is happening in other countries. As a result, we are tackling our problem exclusively with our supposed knowledge.

Whoever regularly reads magazines such as The Economist cannot fail to see that what is happening in Malawi resembles what preceded Greece’s insolvency and bankruptcy.

Professor Charles W.I.  Hill of the University of Washington in his book International Business says: “The financial crisis had its roots in a decade of free spending by the Greek government which ran up to a high level of debt to finance extensive spending in the public sector. Much of the spending increase could be characterised as an attempt by the government to buy off powerful interest groups in Greek society from the teach and farmers to public sector employees rewarding these with high pay and extensive benefits.

These are the people that we call rent-seekers, people who while the economy is either not growing or growing at a snail’s pace demand 50 or 100 per cent increases of their earnings without they themselves providing extra services.

We do not need dictatorship in Malawi, but we need a regime that has the courage to say no to rent seekers, a regime that is not being pushed around by lobbyists and strikers. In developed countries where trade unions started when workers go on strike, they are paid by their employers. They accumulate strike funds from which they pay themselves. This arrangement discourages wildcat and illegal strikes as well as intransigence in negotiations.

But I understand in Malawi when public sector servants go on strike, they still draw their salaries, no wonder we hear too many of sitting ins.

This practice should be stopped. When public servants go on strike, taxpayers and their dependents suffer a good deal because public services are usually monopolized. When magistrates go on strike where can litigants go for alternative services?

Applying the Vilfredo Pareto principle you will notice that 80 percent of the days work lost in strike is due to the activity of 20 percent of the public institutions while 80 percent of the departments and parastatals keep working without cause trouble.

Margaret Thatcher and Charles de Gaulle are my heroes because they put national interests above those of rent seeking groups and blackmailers they transformed the economies of their countries. After the Iron Lady left no one would talk of Britain as the sick man of Europe.

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