The first time I visited Ghana as a child, I heard the word “Osagyefo” mentioned a lot by the adults nearby, usually when hanging around national landmarks in Accra and Tema. There was no Google at the time, but it did not take long to figure out that this word – usually uttered by a visibly awed speaker – referred to a former Ghanaian Head of State called Kwame Nkrumah. The man was respected, no – revered in Ghana.
Years later, I began to understand that Nkrumah’s influence extended far beyond Ghana, as probably the most important progenitor of the African independence movements that swept the continent in the 1950s and 60s. So great was Nkrumah’s influence on modern African political and economic thought that even today – 53 years after the 1966 military coup that sacked him from office – a large portion of Sub Saharan African economic and political decisions are still consciously or unconsciously informed by his ideas.
This unfortunately, comes with a number of unintended consequences,
Nkrumahnomics: A solution for a world that no longer exists
The most important thing to understand about Nkrumah’s vision for running a country and an economy was that it was a solution for the world of the 50s and 60s. At that time, political independence from colonialists was the driving consideration behind the economic model of a newly self-confident Africa led by Ghana and its charismatic leader. The Cold War offered a unique opportunity to gain leverage over the erstwhile colonial powers, using the threat of Soviet alignment as a bargaining chip.
As a result of efforts by Nkrumah and his peers who set up the Non-Aligned Movement, my dad and many in his generation were able to access university education as the subjects of scholarship bidding wars between the capitalist Americans and the communist Soviets. A measure of cooperation with the Soviets also came with the bonus of gaining technology that would have taken several decades for post-colonial Africa to obtain. The Soviets famously even offered to build a nuclear reactor in Ghana, and they also built one of the world’s largest steel mills in Nigeria.
The flipside of these undeniable results was that Africa’s post-independence leadership got used to certain Soviet ideals and values, chief of which is the idea that the economy of a country should be subservient to the State, and not the other way around. There was an implied inference that the state must be a well-meaning, paternalistic hegemony that divvies up the “national cake” for the benefit of all. This also meant that there must be a benevolent strong man at the head of the country’s affairs, and of course we all have our experiences with such men.
All of the strength, but none of the benevolence.
Nkrumah’s vision did not account for two key things. First, it did not countenance the idea that Soviet communism would be proven entirely wrong and vanquished as it was a few decades later. It gambled the future of a continent on the assumption that Das Kapital was greater than or at least equal to Adam Smith’s economic theory. It borrowed so heavily from communist ideology and language that it made it difficult for adherent African government to converge with the rest of the world later when the Soviet Union fell. The former Soviet states had the industrial capacity and knowledge bank to transition from communism to capitalism. All Africa had in contrast was emotional rhetoric, hot air, shiny statues of Osagyefo, grandiose pronouncements and uncompleted projects.
Second and more importantly, it ignored the fact that centralizing too much power in the hands of the state would attract the wrong people to government and create political problems down the line. Nkrumah believed that love for “Mother Ghana” – a phrase directly borrowed from the Soviet communist lexicon – should be sufficient to make everyone act in line with the country’s best interests. As the Soviets later found out, this was a false idea in violation of basic human nature.
In Nigeria for example, the government chose to ignore the recommendation of consultants to site the steel mill outside Onitsha near locally mined ore deposits, to reduce import expenses. Having recently come out of a war where one side was definitely vanquished regardless of whatever Yakubu Gowon said, the government decided that the pesky Biafrans should not be ‘rewarded’ for their petulance. It instead moved the mill to the middle of nowhere in Kogi state – a poor economic decision, but an acceptable political decision. 40 years later, Ajaokuta Steel Mill is yet to carry out a single day’s work.
Nkrumahism does not account for selfish, vindictive or self-harming decision makers.
Nkrumahism is a false religion
A look around Africa right now yields a plethora of stories attesting to the failure of economic governance that comes with imposing Nkrumahnomics on a society heading into the 4th Industrial Revolution. Here in Nigeria, the Lagos State government – which has spent 12 years building a single intra-city rail line with no completion date in view– is about to introduce a new licensing fee regime for bike-hailing startups. The regulation will force them to pay N25 million per 1,000 bikes and N30,000 per bike after the 1,000 mark. In classic Soviet-communist fashion, the government has swooped in to assert control over any new idea or business venture, hitting it with onerous licensing and registration fees – and ultimately stifling innovation in the long run.
The same scenario is repeating itself next door in Cameroon where the government has introduced a new law requiring telecom operators to pay a fee of 200CFA (about N126) for every app download made on smartphones using their network services. Putting aside how ludicrous and unenforceable this rule is, it perfectly illustrates the greatest flaw inherent in Nkrumahnomics – the idea that the state’s posture toward business and private profit making enterprise must be combative and reactionary.
This is born out of the independence-era mindset conflating capitalism with colonialism. Indeed Vladmir Lenin whose Soviet ideas influenced Nkrumah and his peers, described colonialism as “The Highest Stage of Capitalism.” Logically, if the African struggle for self-actualisation was the struggle against colonialism, then that also meant that capitalism itself was Africa’s enemy. Today, nearly 60 years after independence, African governments still retain a reflexive anti-business posture, encapsulated by NAFDAC’s recent decision to revise registration fees upward by up to 200 percent, for no discernible reason whatsoever.
In Kenya, the ruling Jubilee Party’s election manifesto includes a promise to “work with county governments to establish at least one industry in every county.” This is almost word-for-word ,the language of Soviet-style central planning, but no one seems to have cottoned on to the idea that maybe it is not actually the government’s job to “create industries.” It is a similar story next door in Uganda, as the state-owned Kiira Motor Corporation is planning to invest $263 million in a vehicle assembly plant.
This shiny porcelain elephant is based on a remarkably optimistic projection putting East African demand for Kiira vehicles at 150,000 units per year. One would be forgiven for thinking that this is the kind of projection typically made by a politician seeking to justify his continued stay in office after removing the constitutional age limit of 75…
Even at our regular everyday level, we are also unwitting adherents to the church of Nkrumahnomics, as illustrated by Desmond Elliot proposing a ban on foreign movie content in Nigeria as the way toward Nollywood’s self-actualisation. Our belief in government bans, restrictions, subventions, interventions, subsidies, and exchange rate manipulation as tools of fiscal and economic policy is a symptom of our belief in a church led by a charismatic Ghanaian leader.
Like the other kind of church currently causing havoc across the continent, perhaps it is time for Africans to reexamine everything we think we know about economics, so that we can stop self-harming in the name of something we do not understand.
David Hundeyin
