Prime
The contradictions of Musevenomics
Author: Moses Khisa. PHOTO/FILE
What you need to know:
- Unless we get a radical rethink that decidedly breaks with the neoliberal creed, ours will remain a story of growth without transformation.
In a recent engagement with members of Uganda’s media, President Museveni fielded a range of questions including on the economy. The long-winding and annoyingly circuitous answers aside (including some unnecessarily long and imprecise questions too!), his performance underscored two versions of Mr Museveni.
The first version is a sharp mind that commands a set of ideas central to grasping fundamental questions of the economy and national and regional security. For example, on the economy, in one of his lengthy answers, he addressed the criticality of empowering individuals to pursue production and increase overall national output. The details of how to do this is where he falls woefully short.
The second version of Museveni is the one who, either innocently or naïvely, is clueless or simply deceptive, cavalier and delusional. This second Museveni is most pronounced in the realm of national economic approach and strategy which he has stuck to for the better part of more than three decades.
The Museveni of Musevenomics got his ideas about the economy after imbibing the neoliberal thinking about self-regulating and perfect free markets as the engine of growth. The delusion here is that forces of demand and supply, individual actions and decisions, ultimately drive society to prosperity. Since the late 1980s when Mr Museveni became a convert, he has been by far the best student of neoliberalism and the so called Washington Consensus free markets economics whose foremost agent and advocate in Uganda, other than Museveni of course, was the late Emmanuel Tumusiime-Mutebile, the long-serving governor of the Bank of Uganda.
What I characterise as Musevenomics is the Ugandan iteration of a free markets ideology, which operates with a sleight of hand. On the one hand, the Musevenomics creed purports to have full trust in free markets and individual enterprise with no direct government role. On the other hand, however, there are corrupt business practices and crony capitalism where certain individuals, including foreigners, get the power of the state and the influence of powerful government officials behind their business activities. The latter aspect of the two-faces of Musevenomics is actually the more realistic and can be found in other countries: governments do pick winners and losers in the market place. Free markets do not. The difference for Uganda is that there is no overarching national strategy to pick winners or to direct resources into productivity in ways that can both grow the national economy but most important can bring about shared national prosperity.
The problem with Musevenomics is the gulf between theory and practice, the difference between rhetoric and reality. The sheer contradictions and inconsistences, on the one hand purporting to be promoting a ‘Parish Development Model’, which is an overt acknowledgement that government in a poor country must have a plan for growing the economy and improving livelihoods, but at the same time insisting that the state cannot directly intervene to drive economic activity. The bad news for Mr Museveni and supporters of his convoluted, and quite frankly confusing, Musevenomics is that no single country in human history ever transformed from poverty to prosperity through the working of free markets. At the media engagement alluded to above, Ms Sarah Kagingo, a regime operative and former State House staffer, did ask Museveni a pertinent question: ownership of what passes for local content, that is, local production but in the hands of foreign ownership.
Consistent with his long-standing stance that has cast him more as an agent of external capitalist interest than a nationalist leader pursuing prosperity for his citizens, Mr Museveni cavalierly dismissed Ms Kagingo’s concern harkening to his obsession with GDP. For him, everything produced in Uganda and which counts towards Uganda’s GDP is all that matters regardless of the nationality of the real owners. Perhaps, Mr Museveni needs to be reminded that no country anywhere in the world got itself out of impoverishment with the economy in the hands of foreign capitalist interests that are at the core short-term and singularly profit driven. Museveni appears patently indifferent to the notion of promoting and growing a local business (capitalist) class and instead believes it is the market to determine ownership and the structure of the economy.
Yet, and this one of the many contradictions of Musevenomics, this is also a president who proudly announces that he is a producer of milk and beef, who does business with government (meaning with himself) and sees no problem with using his control of the state to advance his own business interests! Ultimately, under Musevenomics with all its contradictions, inconsistences and lack of a clear and coherent national strategy, the best we have achieved and can hope for in the future is modest GDP growth that is easily wiped away by rapid population growth. Unless we get a radical rethink that decidedly breaks with the neoliberal creed, ours will remain a story of growth without transformation.
