Looking at the levels and disparities of development around me, This question came lingering. Is capitalism working for this continent? or is it one of the post-colonial fallacies Africans were made to believe were good for them! You look at Africa’s growth model and you wonder whether its capitalism we are practicing or Greedy.
Do we really understand what is capitalism? what are the pillars of capitalism? This made me re-visit my introduction to micro economics. Here you meet Adam Smith and his great work in the book titled the wealth of nations.
Capitalism is an economic system that is based on private ownership of the means of production and the production of goods or services for profit. Other elements central to capitalism include capital accumulation and competitive markets.There are multiple variants of capitalism, including laissez-faire, welfare capitalism, and state capitalism.
Principles of Sustainable Capitalism
- Control excessive profit and compensation levels in all enterprises.
- Ensure that the market place fairly allocates resources and products. There is enough land, water, air, minerals, food and money for all to share equitably.
- Adopt a long term sustainable vision rather than short term exploitation for quick profits.
- Renounce the notion of constant expansion and growth. Encourage “steady state economy”
- Restrain consumption rates that simply fuel growth.
- Reduce unnecessary production and eliminate “planned obsolescence.”
- Curb resource depletion and focus on conservation, recycling and renewable technologies.
- Preserve the notion of creative entrepreneurship and innovation but restrain self-interest and control income disparities. Environmental waste is a function of wealth.
- Encourage an equitable distribution of wealth in society.
- Do not promote the privatization of basic human rights, such as water.
Sometimes you look at the value we offer for the income we make and realize that we make more money for nothing. There is no match between the value and the income. Be it service provision, Manufacturing or Even agriculture we want to earn more from little value we offer to our customers, employers and society at large. I call this Greedy. Not capitalism. This is the reason Africans have remained poor despite the “illusion that we are very hard working ” Our leadership is more Greedy than capitalists. Our politicians will go for months without innovating leave alone implementing a single policy that will add value to the masses, yet they draw huge salaries, bigger than the law makers in some very developed and progressive world. is that capitalism? that is Greedy. The wars in Africa where you have to kill so many people in order to get a bargaining power during cease fire Agreements to be recognized as a bigwig is all about value subtraction from the society. I think we lost it longtime ago when our grand fathers blindly followed the so called capitalism that we knew very little about.
Africa needs a more moderate form of capitalism i think a compromise of capitalism and socialism. we need some thing we identify with. something based on African ‘communal’ style of living. This can be proven by a closer examinations of nations that slowly adopted capitalism after trying out socialism and communism. Look at countries like Tanzania and Ghana. They didn’t adopt capitalism immediately after independence. This countries have the lowest levels of Corruption, Nepotism and Greedy comparatively to Nigeria and Kenya That immediately adopted the capitalistic approach after independence.
Ghana and Tanzania might have not taken off economically compared to Kenya and Nigeria but are more likely to achieve Millennium development goals much earlier than Kenya and Nigeria. Why? Simply because the true pillar of development- The social pillar is well anchored. The country grew at almost same levels, the disparity between the rich and the poor is minimal and almost all regions of this countries have homogeneous growth rates despite different endowment of natural resources. The national cake was generously and fairly distributed. This countries are more likely to attain true capitalism. Greed is shunned. Smith was convinced that self-interest would in turn maximize the economic well-being of society as a whole, in Africa self-interest destructs the well-being of society as a whole, our technocrats can easily divert donor funding for a bridge to build himself a palatial home.Capitalism has generated the wealth that has enabled diseases to be conquered, clean water and sanitation to become widespread, and has given people more opportunities and choices in their lives than any previous generation has enjoyed, African capitalism can hardly achieve this.
Capitalism puts tremendous pressure on all of us to make money in order to survive. Hospitals, schools, prisons, “non-profit organizations,” and every other institution must conform to the profit motive, or be swallowed up. I leave you with this question in your opinion Is Capitalism working for Africa?