What a mess we are in!
So the unimaginable has happened - Trump has triumphed in the States and the Klu Klux Clan are back! Only this time they are getting the keys to the White House for four long years and can burn crosses on the White House lawn. How on earth could the Republican Party do that to us?
In the United Kingdom a similar wave of resentment and pent up frustration has lifted the bridge across the moat that is the English Channel. I always wondered why it was called the 'English Channel' and not the 'French Channel' or something else. Now we know why it was put there.
We need to remember why the European Union was created. It was created after two Wars that embroiled nearly the whole world and saw tens of millions of young educated men and women die on senseless battlefields for no purpose. At the end of these mindless conflicts, Europe and Asia lay in ruins, smashed to rubble at a cost of trillions and out of the cellars and bomb shelters came a small handful of men and women who said 'never again' and started the long task of rebuilding Europe and Asia on the basis of a new vision.
We are about to discover if the institutions that were created out of global conflicts based on racial discrimination and terror in both the United States and Europe can stand up to these monumental shifts in global politics. You may not like the new world order that has been created over the past 70 years but it has given the world unparalleled prosperity and peace. Sure we have had conflicts but they have been localized and have not been allowed to spread across the globe as the wars of the past have.
Sure, we still have poverty but more people have been lifted out of poverty in the past 70 years than in all the rest of world history. We have experienced monetary and economic problems - some on a vast scale, yet they have not led to the sort of global collapse that characterized the world after 1929. The reason for that lies in the multilateral systems that were put in place after 1945.
I and the rest of the world are going to miss the Obama's - both of them. Mr. for his inspiration that ordinary people everywhere can change their world, that there are no ceilings in the political world of today. Mrs. because she is one amazing and beautiful woman who stayed at home and supported her husband and raised her children like a mother hen in a storm. I hope and pray that they will not stop speaking into our broken and bruised world where we need sanity and common sense more than ever.
I have lived in a closed society and economy where all imports were controlled and the great majority of consumer goods were produced by monopolies and domestic markets had to pay a premium for inferior goods. During the brief summer of the GNU in Zimbabwe I lived in an open society with the near total freedom of movement of goods and services across boundaries. Consumers in places like Zimbabwe know that controls and shortages mean higher prices and restricted choice.
Because of the economic crisis that bad macroeconomic policies has brought to this broken country in 2016, they have resumed all the restrictive policies of the past - import controls and restrictions, exchange control and limits on cash going out of the country. Our neighbors have complained as trade has shrunk and prices have risen across the board in local markets, shortages have started to appear.
Free markets and market driven policies are tough masters. They demand high productivity and consistent quality. They require aggressive procurement policies and ruthless attention to cost drivers. Where these are not present, countries slide into a bog of all the things that slow development and inhibit innovation. Where it is not possible to meet the competition in an open economy, industries die and are replaced by other forms of activity.
Remember when we all used typewriters? Do you recall the era of call boxes? They are gone, never to return. Do you remember when US Steel, GM and Ford were the largest Corporate's in the world? No longer, Apple is a 100 times the size of GM and it's based on intellectual and financial capital. Industries rise up and they die with frighteningly speed. Only change is constant and no country in the world today can ignore global trends and markets.
Trump's decision to withdraw from the Asia/Pacific Trade Agreement is like saying 'stop the world, I want to get off'. Russia and China are delighted in that it opens the door to a deal that has taken 7 years to negotiate and they can now simply step into the vacuum created by the USA and strengthen their own market position in a region that soon will generate half of all world output. His promises to bring back jobs in the 'rust belt' of America and to restore the 19th Century dominance of coal are simply nonsensical and doomed to fail.
So where do these global shifts leave those of us who live in small countries with delinquent or even criminal governments? Firstly it brings us hope in the sense that no country today can ignore their neighbors or what is going on in the world 'out there'. We live in a world where international values dominate relations and the way countries are governed. I spoke at a Conference recently in South Africa where I referred to what I called the 10 Commandments of modern governance.
- The supremacy of the Constitution;
- The Rule of Law and equality before the law;
- The separation of powers between the Executive, the Judiciary and the Legislature;
- The use of open, democratic principles to guide elections which are free and fair and which allow regular changes to national leadership;
- The use of market forces to determine the level of prices and the cost of projects;
- A free press and free competitive electronic media as well as open access to IT services and the internet;
- The need for independent, professional police and prosecuting authorities;
- Strict application of the law and the penalties that are associated with corrupt practices and activities;
- Protection for whistle blowers; and
- The adoption and strict adherence to sound macroeconomic policies and practices to protect fundamental economic interests.
Ultimately these rules and values will win in this game of change and challenge. When it does we can expect countries like Zimbabwe to be released from the prison it has been in since Independence. Only then will real progress on all the above fronts be made and as many countries have shown in recent years, this process will in turn lead to rapid development and growth with sharp reductions in poverty and related ills.
Johannesburg 23rd November 2016