When the Soviet Union unraveled in 1989 (or around that time) Many in the USA felt they had won the cold war. Francis Fukuyama even wrote a book called the End of History, in which he claimed that there would be no more big developments in world history: the US model of capitalist democracy would rule the world from then on till eternity. This view was obviously shattered with a Big Bang when the Twin Towers came down in the famous Al-Qaeda attack on September 11, 2001. From then on it looked like the major opposition to neo-liberal capitalism in the world came from Islamist terrorism.
Here in Malawi we have been fortunate to not have experienced any of this first hand. Here the battle seems to be on a more conservative plain: the government system here still largely lives in the Kamuzu Banda days of the cold war. This does not work in a neo-liberal international environment and the consequences are a collapsing economy and wide spread hunger.
There is some resistance to this government policy: the media (most explicitly the newspapers) and some of the business world are promoting a more modern type of government, with rule of law, and a favorable investment climate. This would mean that the ruling elite needs to give in some of their personal power, and in the short term some money. Rule of law means no-one is above the law, not even the President. It means the ATI bill, limits to the Presidential powers, it means a lawsuit against the State has just as good a chance to be won as against anybody else. It means the judicial system adheres to jurisprudence. It means the legislative is not pushing for more perks (allowances, subsidized loans, Community Development Funds etc) but making laws that facilitate development. They are advocating for a more USA style economy. The same are the US doing themselves: they subsidize Escom, on the condition that it privatizes: more capitalism, less State influence. International Tobacco Buyers are also pushing for more freedom: they have gotten the opportunity to practice contract farming and the Para-Statal auctions are strongly limited in their influence. Again more freedom for capitalist companies and less direct State intervention. Hopefully it will also limit corruption, which eats into the growers’ income in a big way.
But then the question is: what will be consequences of a more liberal political economy? It may very well grow the economy, or it may not. But liberal policies definitely increase inequality, and lessen State power to support people in need. Look at the extremely neo-liberal US administration of George W Bush: he did very little to support the victims of the hurricane Katrina. In fact he had removed much of the opportunities of the government system to do so.
An alternative way to liberalism that is getting more in vogue over the past few years is the European model of social democracy. It had been overruled by the Thatcher-Reagan approach of the 1980s. Even Blair had removed it from the (social democrat) UK Labour Party. But currently they have an explicitly social democrat leader: Jeremy Corbine. And in the US the social democrat (or democratic socialist, as he calls himself) Bernie Sanders has come much further than any social democrat before him, with a serious bid for the Democratic Nomination. And he is pushing candidate Hillary Clinton in a social democrat direction, for him to endorse her as democratic candidate (which means he will advise his supporters to vote for Hillary Clinton only if she adopts a number of his policies).
We could look at ways to introduce social democrat policies in Malawi. Thing is that these are usually centralized policies to redistribute Knowledge/Power/Income from the ruling class to the general population. Knowledge through subsidized education, a system which is being dismantled by government now: university fees go up and the quality of public schools is going down because of systemic under-funding. The ATI bill would help, too. Power would spread with income, as well as improvements in the quality of the democracy and rule of law. Income should be spread with higher minimum wage, lower perks for the top of civil service and politics and strongly progressive taxes, administered in an impartial and incorruptible way.
The FISP could be a good social program if it were not undermined by corruption and inefficiency. And here is another problem: our government is severely limited in its implementing power because of these: corruption and inefficiency. As Minister Kumpalume recently said: When Government is involved in a project, costs multiply. He spoke of the new state-of-the-art cancer treatment center, where cost overruns were in the range of 400%. This shows that our government is crippled in implementation: this way It can only do 20% of what its money is worth because of the inefficiencies and corruption. This makes a successful social democrat State a long shot.
Who has a better idea?