The trouble with Uganda’s economic gangsters…

Corrupt government is hard work. It is far cheaper and easier to have an honest government.

I have just finished reading a wonderful book titled Economic Gangsters: Corruption, Violence, And The Poverty Of Nations by Raymond Fisman and Edward Miguel, two American economists.
To Ugandans, some episodes described there would be very familiar, given our recent fight over the Oil Bill, and the dust over corruption.

Ugandans would particularly be intrigued by the story of the Indonesian strongman Suharto. We are told that despite the big time corruption by the Suharto regime, Indonesia still managed to turn in very impressive economic growth rates of 6 per cent over the 30 years of Suharto’s rule, “making it one of the great economic success stories of modern history”.

Sound familiar? Then you haven’t read this yet: “While the Suharto clan may have taken more than its fair share, poverty levels fell dramatically in the Suharto years, and public education, health…were also greatly expanded.

“Plenty was left over to trickle down to everyday Indonesians,” Fisman and Miguel write. The authors suggest that Suharto made sure stealing never really got out of hand, and he played by the rules in the crooked book. “For better or worse, the Suharto regime had a reputation for holding up its end of bribe transactions, at least removing the uncertainty that is a part of most illicit transactions.”

The post-Suharto years have sometimes been messy, and a foreign business executive in Jakarta laments the state of affairs today: “There was a price for everything [during the Suharto reign] and everyone knew the price and what he was getting for what he paid.” However, today “you see chaos instead.”

Read that and reflect on the runaway corruption in Uganda. The corruption itself is bad, but what seems worse is that no one is managing it as Suharto did. There is chaos.

Secondly, Uganda’s crooks seem to have also broken another golden rule of corruption. Don’t eat everything, let some trickle down to the people.

The chaps at the Office of the Prime Minister who stole the reconstruction billions meant for northern Uganda, and those who robbed pensioners broke every rule in Suharto’s book.

This brings us to a strange place. While everyone is cursing the rot in government, perhaps they should worry more that its corrupt officials and leaders cannot steal well. It seems their inability to be smart crooks, is a wider reflection of how incompetent they are.
Indeed few leaders and bureaucrats can be very corrupt, but still build roads, have hospitals stocked with medicine, increase teachers and nurses’ pay, and so on.

The path the Kampala government has chosen is a very difficult one. Corrupt government is hard work. It is far cheaper and easier to have an honest government. Look at Tanzania’s founding father Julius Nyerere. He was an honest simple much-respected man, and whenever he called on Tanzanians to sacrifice, they did so willingly.

After the collapse of the first East African Community in 1977, Tanzania had no international phone system. To raise money to build one, 25 per cent of public servant’s salaries was cut for many months. It caused hardship, but Tanzanians became more nationalist, because they had given up their salary to build a national institution. They felt ownership. Nyerere could do it because he had integrity.

The late Ethiopian Prime Minister Meles Zenawi docked civil servants’ salaries to finance a giant hydro-electricity dam. Though Zenawi had his critics, his development credentials were well established.

DR Congo’s thieving dictator Mobutu Sese Seko, on the other hand, couldn’t call on his people to sacrifice precisely because he was corrupt. The Congolese didn’t believe in him, and I suspect like many Ugandans view their government today, believed that he was stealing their money for himself, and would have kicked him out much sooner.

In addition if you are lazy, incompetent, you are better off having an honest government. You don’t have to find a lot of money to build a coalition of the corrupt that keeps you in power.

Finally, since not many people will give a corrupt leader their affection willingly, he needs to buy their love. So a corrupt big man needs economic growth. Uganda’s Big Men, on the other hand, are undermining growth.