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Africa needs property rights, not aid

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LORD Peter Bauer (1915-2002) was Emeritus Professor of Economics at the London School of Economics. He described aid as ‘money taken from poor people in rich countries and given to rich people in poor countries’.

In my experience that is broadly correct; taxpayers in wealthy nations provide aid money which, if it gets there at all, ends up mainly in the pockets of the urban elite of the third world.

However, Lord Bauer’s obituary in the Guardian noted that a review of his work by six development economists in the Journal of Development Studies accused him of ‘low standards of logic and evidence’ and ‘gross exaggeration’. His views, they said, were based on ‘frighteningly flimsy intellectual foundations’. He was ennobled by Margaret Thatcher.

Billions of dollars of development aid has continued to flow to third world governments, particularly in Africa. Some of this has been enormously beneficial. To name three successes: the elimination of smallpox, the supply of vaccines such as BCG anti-tuberculosis which perhaps a majority of African babies now receive, and the provision of clean water.

Nonetheless, now in my ninth decade, almost all of them spent in crumbling African nations, I have to acknowledge that most of the African continent is in a state, as Lytton Strachey said of Keate’s Eton, of anarchy tempered with despotism.

It is possible to pick out two commonalities in this ongoing catastrophe. One is the exodus of their best and brightest to find much, much better-paying jobs in the first world. There is a solution to this brain drain, and you can find it here, but it requires a revolution in the development assistance business, specifically giving money directly to individuals. (There are two disturbing graphs in the above reference, using the World Bank’s database, showing Africa’s persistent poverty and its population explosion).

The second commonality is that African cultures are usually indifferent to the idea of private fixed property rights. This is fundamental to wealth creation, and is such a given in successful countries that many aid workers in Africa assume that the same holds true there. Communal land – the commons – has no value, but if it is allocated to private individual ownership, then magically it acquires a price.

However, most rural land in Africa and a sizeable amount in the urban areas is apportioned by a decision of the headman, chief or local politico, and there is always the threat of it being withdrawn. As I write this scores, perhaps hundreds of substantial brick-built houses are being demolished in a suburb of Harare, Zimbabwe, many not because their owners had no title to the land but because they did not go through the laborious, expensive and corrupt process of getting permission to build.

It requires another revolution in aid policy to correct Africa’s blind spot over the value of land. However, revolutions are abhorred by big old institutions such as the aid industry, despite the engaging youthfulness and optimism of its junior employees on the front lines.

Reassuringly for such institutions, a whole sub-discipline known as development economics has sprung up to prevent such upheavals. With scores of Departments of Development Studies and the livelihoods of hundreds of PhD students at stake, critics of the system get very short shrift. Peter Bauer was fortunate to have a powerful patron.

Perhaps fortunately, what you are about to read here will not be seen for the revolutionary proposal it is. Academics in departments devoted to development studies are not usually geologists or pathologists and it is these disciplines that are relevant to the African dilemma.

In the first place, Africa’s geology, more specifically its quiet plate tectonics, has ensured that the soils of Africa are leached and barren. The only remedy for dealing with this is to slash and burn vegetation before the rains, but this gives only a couple of years fertility, and so it is necessary to move on every few seasons.

Next, Africa’s status as the home of mankind has ensured that it is riddled with primate diseases that are still evolving. These can develop in any primate and are able to survive in all the others including Homo sapiens; HIV-AIDS is only the latest.

The consequence of this harsh environment is that assets must be mobile and that child-bearing is maximised, leading to a culture centred around communal landholding, very early marriage, polygamy and the bride price, returnable if the bride does not become pregnant.

Now, with a modicum of aid-supplied clean water and infant disease control, this adaptation has caused a population explosion. It further results in a deep, near-exclusive loyalty to the extended family that has been fatal to the development of properly functioning nation states in Africa.

It was a sobering thought that almost all democratically elected governments in Africa (not many) had sustained their hold on power by promising the redistribution of wealth. It is a position that almost guarantees re-election when the key electorate is the communal-living rural poor; there are no votes to be gained by those to the right of it and anyone who manages to squeeze in to the left can be safely locked up as a dangerous anarchist.

This illuminates the stark difference between what the developed world expects of itself and of Africa. There would have been outrage if the Australians adopted polygamy, communal landholding and the bride price and bred themselves into poverty, and they would have been told plainly to abandon the policies that were causing it or expect to starve, because nobody would abet them in such foolishness.

To quote Lord Bauer again, ‘far from the West having caused the poverty in the Third World, contact with the West has been the principal agent of material progress there’. But while that progress has started, it has stalled under the weight of rapidly swelling populations.

Let me say it again and plain, Africa’s stagnation is not a mystery: it is a cultural problem. The population’s survival mechanism which has served it so well in the past is now a poverty-generating machine. It must be replaced with a culture appropriate to the new environment, based on the secure private ownership of fixed property to be found in all prosperous nations.

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John Hollaway
John Hollaway is a retired mining consultant, having worked in 35 countries. He is the author of the All Poor Together trilogy, a semi-autobiographical account of development assistance in Africa and the reasons for its failure.

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