Last week, I argued that President Yoweri Museveni has actively stifled the growth of a robust private enterprise sector generally though he has promoted the growth of individual businesses. He has pitted indigenous capital against non indigenous capital by giving preferential treatment to the latter and thereby generating hostility against them from the former. He achieves this because our business class has not yet developed a consciousness of its collective interests and the organisational means to pursue these interests politically. The Uganda Chamber of Commerce and Uganda Manufacturers Association are still young and weak.
Musevenis overriding objective is regime maintenance. To achieve this, he faces a strong revenue imperative. He needs money to buy political support (by providing elites with government jobs/tenders); to finance his legitimacy (through provision of public goods and services) and to buy weapons to coerce those who resist.
The state in Uganda meets these revenue demands by raising money from the local economy through taxation. It then supplements domestic revenue with foreign aid from a largely naive, sometimes self-interested international aid community. This alternative source of money weakens the political influence of citizens, especially the private sector over government policy. By disarticulating the government from its citizens and its business class, foreign aid literally creates a mercenary state.
The funds and diplomatic support from the international community create jobs for local elites; bribes for the poor in form of welfare handouts like free primary education, roads, basic healthcare and releases the states own revenue to finance its coercive capability the army and the police. These dynamics undermine the incentive of the state to seek an aggressive strategy of building a robust business class that can politically use state power to bring about capitalist transformation.
Although international solidarity is important, the particular form Western aid has taken in Africa is problematic. For example, international aid is attracted to our failures, rather than our accomplishments. Hence it comes to help us end poverty rather than to create wealth. Consequently, it pours money into villages to feed the hungry and treat the sick rather than into businesses to innovate and expand. Of course these humanitarian gestures are good. But they do not create dynamism. Instead, they tend to subsidise failure rather than reward success.
There is a practical problem with a strategy that seeks to fix ones weaknesses instead of leveraging ones strength. When you fix weaknesses, the resulting growth is slow and incremental growing additively (or arithmetically) as 1, 2, 3, 4, 5 etc. When you leverage your strength, the results grow at a geometric rate (multiplicatively) as 1, 2, 4, 8, 16, 32 etc. Thus, if one used foreign aid to support farmers who are innovating with new technologies or businesses that are finding creative ways of growing bigger and penetrating newer markets, the resulting growth would be multiplicative. Aid fails because it goes to help a failing farmer (who is poor and hence cannot pay his medical bills) rather than a successful one.
Yet Musevenis strategy of stifling the growth of an indigenous business class and pitting it against non indigenous business class cannot succeed in the long term. Ugandas macroeconomic policy framework ironically imposed on him by foreign donors promotes the growth and alliance of capital. So he can only influence the pace but not the direction of this change. Every day, many Ugandans enter business and succeed singly or in partnership with foreign investors.
How then do we promote collaboration between local and foreign capital? This is the issue we need to discuss. Yet a section of Musevenis opponents spend most of their time fighting the growth of the very class our country needs to transform. They keep complaining about the inadequacies of Ugandans rather than finding out our collective strength. This generates apathy, something unlikely to motivate Ugandans to work for change.
At the lunch discussion with the Western ambassador, one of the loudest critics of Ugandan society was a guy who runs a successful private research institution. The other was a successful academic at Makerere. These guys have achieved a lot in spite of an incompetent and corrupt government. I wondered why they are so obsessed with Musevenis failures rather than their own accomplishments and those of MTN, Oscar Industries, Kalita Bus Service, Simba Telecom and Ruparelia Group. We need to leverage our strengths to change our country.
But first, we need to overcome this apathy. And to disagree with Museveni does not necessarily mean that one should reject everything he has done. Many Ugandans in business and other sectors believe the reforms of the late 1980s and early 1990s improved our lives. To deny this is to switch them off. To them, you sound like Museveni full of partisan rancour and therefore unable to see the value on the other side.
This partly explains why many enlightened people have turned away from politics thinking that it cannot be a vehicle that represents their shared understandings of the Ugandan reality. Ironically, it is the oppositions inability to appreciate Musevenis achievements that works to the presidents advantage.
Many if not most of Musevenis mainstream critics are caricatures of the worst in his politics. The population cannot therefore see the difference. We need a new kind of politics that understands the good we have achieved under Museveni and therefore need to protect and build upon; what we have lost under him and thus need to re-create (e.g. public spiritedness in public service and politics); and the new things we need to do differently to move this country forward.
For now, Kizza Besigye has failed to craft this politics. His public spiritedness and personal courage have been effective in mobilising the base i.e. rallying those who already disagree with the regime. But they have been ineffective in winning over those who are sitting on the fence. Besigye has thus solidified the anti-Museveni base but he has not grown it either. Whoever seeks to grow this base needs to be more circumspect. Agonising that Uganda is a dysfunctional country, its people only left at the mercy of Museveni and cohorts cannot bring about the change we need.