Welcome to Kenya, IMF's Little Colony

Editorial by Mutuma Mathiu, The Nation (Nairobi), 20 May 2001

If you ever doubted that we have surrendered our sovereignty to a faceless cabal of foreign bureaucrats, then you will find very illuminating the appalling admission by the Attorney-General this week that draft graft laws were submitted for approval to the IMF before the cabinet and Parliament had a chance to see them.

It calls to mind a comment by a foreign diplomat after Kenya had signed an aid resumption agreement with the IMF some time ago: "The Kenyans signed the agreement before proof-reading it." Kenya had committed itself to repealing laws it had already repealed - to taking action it had already taken. The pact was quite obviously drafted by somebody who was totally ignorant of the local situation and the Kenyan side had had no input whatever into the matter.

This last instalment on poverty and the Third World's oppression tackles this uncritical and total dependence on the IMF, not only for money, but also for ideas on how to run our country. Let's first note that it is outrageous, humiliating and illegal for the AG to allow a body not empowered by our Constitution to vet our laws. Tell us, Mr Wako: Does the IMF have any legislative or oversight powers over our institutions? If so, in what way are we independent? Failure by the AG to come up with straight laws is a domestic matter. It does not give the IMF any legislative authority over the Republic of Kenya. It just means that the AG needs to hire a smarter drafter.

Having got that off the old chest, we get down to two questions: Now that we have surrendered all sovereignty to the IMF, do the people in whose hands we have put our future and pride have what it takes to get us out of the morass? And will their prescriptions work?

To start with the second, we are Africans and African peasants are well endowed with common sense. (If I were bragging to some ignorant wench in a bar, I'd refer to it as utilitarian empiricism. There is nothing like, that of course. The phrase is only a derivation of two measures of truth - utilitarianism ["It is true if it works"] and empiricism ["It is true if it is can be perceived by the senses"]. But I did say the wench would have to be dumb, didn't I?)

Our bucolic common sense tells us that, with an economy performing worse than it has ever done since the Union Jack went down, we are not getting things right.

We have practised neo-liberalism, under the tutelage of the IMF, for close to 20 years now. We have been told that the market is God, that it will allocate resources most efficiently, that the state can only get in the way.

My only contribution will be to repeat a quote by Susan George at a Conference on Sovereignty in a Globalising World in Bangkok two years ago, from Karl Popanyi's The Great Transformation: "To allow the market mechanism to be the sole director of the fate of human beings and the natural environment...would result in the demolition of society."

When you look at the thousands of children in the streets, the millions without jobs, the myriads without food and the hundreds dying every day of disease, doesn't it remind you of a society that is being demolished? You can make the case that our situation is the result of our own incompetence and thievery, not of the market. My point is that it is not good enough to be complacent. It would be at the height of folly to argue that, just because we don't know any better, the IMF must be right.

Said George: "No matter how many disasters of all kinds the neo-liberalism has visibly created, no matter how many losers and outcasts it may create, it is still made to seem inevitable, like an act of God, the only possible economic and social order available to us."

On to the first question. Prof Joseph Stilglitz, a senior fellow at the Brookings Institution and until last year the World Bank's Chief Economist, has what I can describe only as absolute contempt for the IMF and its "remedies". On top of agreeing that "the IMF's 'remedies' often make things worse - turning slowdowns into recessions and recessions into depressions", he believes it is bungling by the IMF that caused the South East Asian economic disaster.

He says of IMF staff: "IMF experts believe they are brighter, more educated and less politically motivated than the economists in the countries they visit. In fact, the economic leaders from those countries are pretty good - in many cases brighter or better-educated than the IMF staff, which frequently consists of third-rank students from first-rate universities.

"(Trust me: I've taught at Oxford University, MIT, Stanford University, Yale University and Princeton University, and the IMF almost never succeeded in recruiting any of my best students)..."

My intention is not to denigrate the IMF or its staff. What do I know? My intention is only to underline the importance of an ideological debate: The IMF school isn't working and those who ought to know don't think the IMF has all the right answers. Do we want the IMF to continue running this country or do we want to elect a government that can put the IMF firmly in its place and get the job done?

I want to praise to the high heavens shadow agriculture Minister Njeru Ndwiga. His efforts on behalf of coffee farmers is evidence of what one good man, even in the Opposition, can achieve. I credit Mr Ndwiga with keeping the nation's attention (and the subsequent pressure on the government ) on the fate of the Stabex funds, resulting in their eventual release. This is an effective man.