Monday, June 19, 2017

Bill Mitchell — If Africa is rich – why is it so poor?

When I was a student, that is, formally studying for degrees rather than the constant-learning approach which makes us permanent students, I was very interested in development economics and have carried that into the career phase of my work, including doing commissioned work for international agencies in Africa and Asia. One of the things I have come up against in that work has been the question of why are the nations in Africa, for example, so poor, when it is obvious to all and sundry that they possess massive resource wealth. My student days introduced me to dependency theory, which provided a solid framework for understanding the nature of underdevelopment. It stood in contrast to the mainstream development theory that was presented in most textbooks and which we would now call the neo-liberal approach. That approach is publicly enunciated by the IMF and the World Bank as if it is reality. In fact, it is a chimera! The framework of development aid and oversight put in place by the richer nations and mediated through the likes of the IMF and the World Bank can be seen more as a giant vacuum cleaner designed to suck resource and financial wealth out of the poorer nations either through legal or illegal means, whichever generates the largest flows. So while Africa is wealthy, its interaction with the world monetary and trade systems, leaves millions of its citizens in extreme poverty – unable to even purchase sufficient nutrition to live. It is a scandal of massive proportions and should become the target of all progressive governments (as they emerge).
Neoliberalism entails neo-imperialism and neocolonialism. For example "spreading freedom" and "making the world safe for democracy" really means expanding the market state and eventually replacing states with the global market, which equates freedom with economic liberalism and democracy with capitalism. This is the basis of neoliberal globalization. In this scenario, the military and security services become protection services for private property, which is increasingly falling into the hands of the super-rich owing to their capture of policy.

Bill Mitchell – billy blog
If Africa is rich – why is it so poor?
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

6 comments:

Bob said...

Development aid – providing funds to develop public infrastructure, education, health services and governance support.

The root of the problem is poor governance, which suits the aims of the 'extractors' just fine. The order of this list is putting the cart before the horse.

Nary a word about Chinese investment in Africa, and a comparison between its approach and those of the western-based institutions.

Bob Roddis said...

Africans completely lack enforced private property rights in their possessions and their bodies. They are not physically safe and there is no neutral and efficient court system to quickly and fairly rectify violent assaults and fraud. Thus, their problems have nothing to do with "capitalism" or a free market.

Butchering words and language, as is usual here.

Tom Hickey said...

Africans completely lack enforced private property rights in their possessions and their bodies. They are not physically safe and there is no neutral and efficient court system to quickly and fairly rectify violent assaults and fraud. Thus, their problems have nothing to do with "capitalism" or a free market.

Somewhat of a generalization about all of Africa and the progress some areas have made. It also rest on the naïve assumption that Western liberal institutions can be exported like Western technology, for example, and that the "natural laws" of economics apply everywhere equally.

However, colonialism, racism, tribalism, traditionalism, and a host of other sociological factors supervene.

Development is a process and the Global South behind the curve relative to the Global North, and the process has begun earlier is some places and also proceeded faster in some places rather than others, owing to differences in conditions.

Globalization is going to continue to go forward, albeit in fits and starts and neoliberal globalization is not necessarily the path it will continue to take. I have said that then process could take 500 years, which is what it took the Global North to develop, and it could involve a similar amount of conflict and disruption.

Kaivey said...

"7. Capitalists praise freedom and individualism, but they destroy freedom and individualism for everyone but themselves. The vast majority of us who work for a living are daily asked to uncritically follow orders, to act as if we are machines, and limit our creativity to what profits our bosses."

https://www.counterpunch.org/2014/08/13/top-10-reasons-to-hate-capitalism/

Magpie said...

Those guys use a different definition of freedom

https://anticap.files.wordpress.com/2017/06/mike4june.jpg

They do love freedom... for them only. Not for us. No siree. For us it is Pinochet.

Neil Wilson said...

"Africans completely lack enforced private property rights in their possessions and their bodies"

Time to visit Botswana Bob.