Ever since the ruling EPRDF party and its government chose, as part of the country’s strategy, a state-led development, advocates of the neoliberal political economy have been expressing their disagreements. I do not claim to be an expert in these fields, nor do I intend to provide a full narrative of the two diametrically opposed political economies that have been areas of contentions in Ethiopia’s recent political history. But, I decided to start by providing a short introduction just to refresh the reader’s mind. I also start by admitting the fact that both political economies have their own narratives of success stories and it is meaningless to deny their existence. I suggest the debate should rather focus on their practicality in the current Ethiopian context.
Much has already been said about the democratic developmental state ideology that is currently at the core of Ethiopian policies and strategies. Needless to mention, this stands in stark contrast to the Neo-liberalistic viewpoint advocated by the West and other followers of that school. The neo-liberal school defines economic intervention by governments as a source of market failure and suggests that its role be relegated to a possible minimum. It suggests that the role of the government be limited to the protection of individual and property rights, enforcement of contracts, and safeguarding competition among economic actors.
On the other side of the fence stands the developmental state (DS) and a slightly different version of it - the “democratic developmental state” (DDS). The notion of a developmental state is not entirely new to the literature in development economics and international political economy. State-led development was encouraged and supported by the international community in the 1950s and 1960s. Almost all western governments, at some point in their history, played the role of a “developmental state.” Many countries employed the Keynesian approach to reinvigorate their economies when such was deemed necessary, and Europe was revived by the “Martial plan” that was drafted by America following the devastation of WWII. Yes, even those that condemn the state’s involvement of any form used it before the “market extremism” took center stage. It was only in the 1970s and 1980s when state-led development was accused of being inefficient. Since the mid-1990s, however, the role of the state in development was re-evaluated based on new success stories in several East Asian countries.
In “the Economic Theory of the Developmental State,” Ha-Joon Chang defines a developmental state as one with sufficient organization and power to achieve its developmental goals. This presupposes that a developmental state ought to have the capacity to sufficiently control domestic affairs and needs to build consensus on a national developmental agenda by drawing attention to its long-term benefits to all.
At the backdrop of the failure of the neo-liberalist approach to demonstrate its utility in post-colonial Africa, Asian and Latin America, the former Prime Minister Meles Zenawi argued that neoliberalism had reached a dead-end and needs to be replaced by a new approach. The 2008/9 financial crisis and the social crises that followed gave opponents of the neoliberal school additional ammunition to question its validity for poorer countries. In his 2012 draft paper, Meles Zenawi described the neo-liberal political economy as a “night watchman state.” He boldly challenged its foundational principles and openly stated that Africa needs a paradigm shift to a home-grown and more progressive one. Contrary to the developmental state (DS) that was instrumental in propelling some Asian countries into prosperity, Meles argued that the state can be not only developmental, but also democratic – hence the term democratic developmental state (DDS) was coined. To his defense he called the social-democratic coalitions in some Scandinavian countries, and the center-right coalition in Post Second World War Japan, the dominant party democracies which have played a developmental role in exercised democracy. DDS therefore needs a persuasive state with the competence to mobilize people and resources around its development plan, especially if it is to become democratic. Those who support DDS argue that successful and sustainable development by its very nature is inclusive and participatory, which can never be realized without popular democratic rights.
I have to make it clear from the outset that I do not have any enmity with either of the two sides. I prefer to judge them based on merits of achievements than on ideological dogma. I may not agree with the extreme left side that states that neoliberalism is dead and has lost its glory especially after the 2008/9 financial crisis. It definitely had its share of success in driving the economies of countries that fulfilled the necessary grounds for its execution. However, despite the common rhetoric regarding the benefits of the free-market economy, no-one can name even a few examples of poor countries that managed to extricate themselves out of abject poverty based on the neoliberalist prescriptions. Rather, it is public knowledge that their recommendations made elites richer while leaving the majority in destitution. Study after study has demonstrated that even economic superpowers, such as the USA, managed to show mediocre progress in reaching the lower bottom. While the richest 1% proceeded to become even richer, the poor became relatively poorer, contrary to the suggestion of the “trickle-down” effect. If the current trend continues— whereby the top 1% controls over 40% of the country’s wealth— there is no reason why the likes of the Arab Spring may not occur within the wealthy nations as well. At the end of 2005, violent riots surfaced in the suburbs of France, initiated by frustrated youth who could not appreciate this trend. At least for now, I tend to agree with the notion that given where Ethiopia was when the ruling party made DDS the governing ideology, the state needs to play a stronger role up until a broad-based capital has been generated, a level ground is formed for a majority of the people to take their rightful place in the market, and functional policy instruments are put in place. However, as no political economy is eternal, there will be a time when each one shall be replaced by another, each more timely and progressive than the last.
As stated in the beginning of this article, I don’t intend to defend either of the two political economies. It is my personal belief that an ideology of any kind should not be protected for the sake of it. No ideology can be bigger than our country. The fact is that DDS is at work in the country. We must at least accord credit to the fact that heavy state investment in basic infrastructure has gained the country praise from both friends and foes— but not without challenges. I, therefore, would like to propose that the debate be refocused on the following four timely and relevant areas of paramount importance.
First, if we agree that DS is not new, and that there is empirical as well as anecdotal evidence in favor of its success (especially in Asia), what seems to be debated at the moment is whether or not a developmental state can really be democratic. How likely is it that the ruling party can facilitate an environment where “patronage and rent-seeking” is eliminated (or at least minimized) and social capital is accumulated that benefits all citizens? Should a state be undemocratic in order to stay in power long enough to successfully carry out its planned development? Is the current accusation of the government being “oppressive” a result of a contradiction between the relatively successful DS approach and EPRDF’s version – the DDS? Is the current instability an indication that DDS has reached a “dead-end” in the country championing it?
Second, we need to examine the importance and relevance of elections vis-à-vis the idea of DDS. If election is to be relevant in a DDS political economy, there seems to be at least one key prerequisite. Either the country needs to have a national strategy designed through full participation of its citizens, or in the absence of a national plan, elections will have to be symbolic. The former requires active engagement by all parties to design a long-term national plan in which case elections will be fought along the lines of effective implementation of the already laid out national plan. Otherwise, elections can be an area of concern for a DDS political economy. Because there is no guarantee that a winning opposition party ensures continuity. Indeed, opposition parties in the country do not seem to share EPRDF’s worldview, and if they were to take power, DDS might not be their preferred political economy. The question is: does the country have a long-term national plan that was design through a popular participation? Can fear of deviation from EPRDF’s strategy force the ruling party to manipulate election results to stay in power, thereby relegating elections to mere symbolic value?
Third, it is necessary to demarcate a state’s heavy involvement in development, whatever the level of involvement may be; to clearly prioritize the sectors according to their needs for government support; and to proactively determine the time of government’s withdrawal, partial or complete, and smoothly hand the role over to the private sector. Is there a clear strategy and phase-out plan so that citizens can demand if the government drags its feet for far too long? What are the policy instruments that can ensure that the government is not overindulging beyond its limits?
Forth, it is important to look at the type of leadership DDS requires in order to gauge the results promised by its proponents. In this regard, DDS is at odds with the relatively successful DS. The Asian success rode at the back of “benevolent” dictators, whose primary objective was economic advancement, relegating the rights of the people to subsidiarity. The main counterargument against DS and DDS approaches is their latent potential to be ineffective, as well as a source of rent-seeking for political elites. Finding and maintaining a strong, committed leadership that stands by DDS principles and sustainably drives the state agenda seems an important factor. Reflecting on current developments in Ethiopia, there is no time riper than today for raising this question. Rampant corruption reigns in the country and riots are proliferating where youngsters are expressing concerns and frustrations. These grievances are not localized but global, covering the whole country from end to end. The question is, therefore: what type of leadership does DDS call for in order to succeed, assuming that its ideological construct is amenable? Can a country sustain leadership that is committed to the creation of values and motives that keep self-interested behavior in check not only for a brief period, but for a long time (and for how long)?
These issues are deep, and controversial. Hence, it is better to leave many of these issues for further research by experts to unveil the underlying meanings and implications. It is my wish that the fourth issue be addressed without delay, as it seems more timely and appropriate. In response to this question, I envisage two types of responses. The one side may argue that it is possible to have and sustain a desired type of leadership—one that is committed to the country’s national interest, transparent, and free from corruption. Others may say that this type of leadership is not possible to sustain, if not to find. This is because when wealth starts to accumulate, public servants can become “little capitalists” that the system itself created, and since they are designers and executors of policy instruments, they can most easily manipulate their way out. Still others may argue that it may be possible to find one generation that is willing to subjugate its will in place of the country’s, but it is practically impossible for “fathers” to impose similar levels of commitment on the generation that follows. Values can drastically deviate, and/or corruption can override service mentality. Some may even say that DDS falls into the same trap as the failed communist political economies. The current crisis in the country can be cited as an example to justify the latter. However, to be fair to the bureaucracy, can one blame self-serving officials when their remuneration is humiliatingly low compared to the vast majority of technocrats and aristocrats working elsewhere? Can indoctrination on “commitment” and love for the motherland alone save our corrupt officials from perpetuating their ill-behavior? Before succumbing to defeat and throwing away the shovels, is there a way the leadership crisis can be salvaged? It is obvious that the country is at a cross-road. But, no issue should extinguish the glimpse of hope that Ethiopians have witnessed in the last few years. If nothing else, Ethiopians have developed confidence to hold their leaders accountable, and an attitude of “I can,” or “We can.” While compatriots in the country have thrown their weights into the fight against poverty, the contribution from the Ethiopian Diaspora does not seem to be commensurate to its potential. Despite living in civilized nations that believe in civility and decent dialogues, overindulgence in fruitless and slanderous debates tend to dominate. However, disagreements aside, don’t we need common grounds? Matters such as maintaining peace and stability should be the desire of every Ethiopian. Yes, the country is at a stage where change is desirable, but not change for the sake of it. Instead, good change that builds on the current momentum, transforms what does not work, and introduces proper instruments that can optimize the country’s human and natural capital. That is why I would like to conclude by calling for more dialogue on the critical issues discussed in this article, especially on the issue of leadership in relation to the chosen political economy. If Ethiopians chose to do away with the DDS political economy, it should only be on its demerits compared to the rival alternatives. Shalom!
MTA, PhD. Toronto, Canada