What Africa has to say about Obama v. Romney (part 1)

“I spent my life in the private sector. I know why jobs come and why they go… I know what it takes to make an economy work, and I know what a working economy looks like.”

–       Mitt Romney

 

“I think a lot of this campaign, maybe over the last four years, has been devoted to this notion that I think government creates jobs… That’s not what I believe. I believe that the free enterprise system is the greatest engine of prosperity the world’s ever known.  I believe in self-reliance and individual initiative… But I also believe that everybody should have a fair shot and everybody should do their fair share and everybody should play by the same rules, because that’s how our economy’s grown.”

–       President Barack Obama

If Mitt Romney says he knows what it takes to grow an economy, he ought to try running a business in Africa.  See how much tax cuts help you when you have to deliver products on THESE roads:

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Small government in action

A year and 3 months ago, I came to East Africa to build distribution for solar lanterns. Besides selling solar lamps and co-founding a rock n’ roll band, I’ve had plenty of time to reflect on what this small East African country, which itself is celebrating the 50th anniversary of its independence from the British, can teach us in the West about our own politics.

On the one hand, I’ve become more conservative in my views toward charity: seeing so many NGOs run around looking for donors, you realize that for all the good work charity does, it’s the private sector creating the wealth that funds both donations to charities and taxes for governments.

At the same time, I’ve also experienced first-hand what it’s like doing business without the framework of laws and infrastructure that make business easy in the USA.

For example, a few weeks ago I was making a scouting trip to find distributors in Bundibugyo: a remote corner of western Uganda between the Rwenzori Mountains and the Congo border.  There’s a new road being built that you can normally drive on, but this time it was closed.  Instead, we would have to take the old dirt road through the mountains, which the locals have given an ominous name: “the Corners.”

True to its name, the Corners winds its way through the heavily rainforested mountains, traversing under-tree through crazy switchbacks so sharp that they make you wonder how a 40-foot bus can maneuver around them.  The road is barely wide enough for one bus to pass, and during the rainy season turns into a slippery mess of mud that claims dozens of lives each year.  After arriving in Bundibugyo, one local told me, “oh, you took the Corners?  Cars slide off that road all the time, and sometimes boulders or landslides fall down and wash cars off the road.”  I didn’t know that at the time—otherwise I would have bribed the police to let us on the new road.  (So Mom and Dad, don’t worry; never again will I take the Corners!)

Fortunately the worst thing that happened was that we got stuck in the mud for an hour.  One of the workers heroically climbed down UNDER the bus and dug each wheel out with a hoe as the rest of us pushed the bus from behind.  The bus got free, and we finally reached our destination at around 10:30pm.  The 200-mile (337 km) journey had taken 9 hours.

Now I’d like to ask Mr. Romney: How much more expensive would goods be in the US if they all had to travel on roads like The Corners?  How many jobs would trading passable roads for lower taxes create?

For that matter, will low taxes help businesses’ sales when consumers spend 50% of their income on school fees instead of buying businesses’ products?

Does it help productivity to have your employees miss work because they’re sick with malaria or they’re burying their child because they couldn’t afford health care?

Does it help food buyers’ wallets when 1/3 of the corn crop is killed by record drought caused by global warming—the result of oil and coal production?

And is it worth it to reduce gas prices and regulations when the result is pollution so thick you literally choke on it during your morning jog?  Nothing like a thick black blast of diesel exhaust to the face to remind you why we have an Environmental Protection Agency!

The other thing I’ll say is, 40 years ago, Idi Amin deported all the Indian immigrants from Uganda.  Without these vital workers and business owners, the economy collapsed.  Let’s not be too gung-ho about getting potentially good workers out of the country!

So look, I know what makes jobs come and go: a private sector filled by hardworking people with good ideas (many of whom may be born elsewhere), oiled by a financial system that allows people without money to start and expand businesses, and all of it operating on the foundation of good infrastructure, an educated workforce, and a framework of laws that preserves fair play and limits the profit motive’s excesses.  Essentially, Clinton-Obama capitalism.

Low taxes?  Well, it’s nearly impossible for the Ugandan government to collect most taxes, but that doesn’t make it any easier to get my goods from point A to point B, find skilled workers, protect my property, or do any of the other countless business functions that depend on reliable public services!

The question isn’t whether Business or Government is the primary wealth creator: both Democrats and Republicans agree that the private sector is the engine of economic growth. The question is which types of policies help businesses grow–and grow in a way that benefits society (without, for example, choking the air with pollution): small government or smart government; cut and de-regulate, or invest and moderate.

And if you want to know what the Right’s vision of small government, cut and de-regulate looks like in practice, well take a trip to sub-Saharan Africa.

This is not to disparage Uganda or other African countries.  Despite all their setbacks, these countries have been making strides for 20 years in the right direction in developing infrastructure and better lives for its people, and they are now great places to tour and invest.  But let’s not now go the opposite direction in the USA by cutting taxes, reducing infrastructure, and eliminating laws.

If you’re down by 17 and put in a replacement quarterback, you don’t pull him out after he’s thrown 2 touchdowns and driving.  And you especially don’t put the old guy back in.  You leave him in for 4 more years, and maybe get 3 Super Bowl rings in the meantime.

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2 responses to this post.

  1. Thanks for this, Andrew. I think Uganda is definitely a libertarian paradise, second only to Somalia for its freedom from job-killing big government regulations.

    Reply

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