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Sunday, January 26, 2014

We Can Do Better When We Are Less Unequal

Over a decade ago I met a young man named Francis in a little village in Emuhaya, in what is now Vihiga County. Two things about his story struck me. Francis was eleven years old and in class three, with 85 other children about his age.

The world’s richest people, who share a combined wealth of about $1.7 trillion – nearly double Africa’s 2012 GDP estimate – could be crammed into Francis’ class. These 85 men and women, according to an Oxfam report released last week, control as much wealth as the combined wealth of the poorest 3.5 billion people in the world.

The Oxfam report, Working for the Few: Political capture and economic inequality, suggests that massive concentration of economic resources in the hands of a few is a critical threat to inclusive political and economic systems. The report warns that the inequality is impacting social stability and threatening security on a global scale.

Rising economic inequality is the most urgent challenge of our time. In reference to the immense inequality and the rich-poor divide in South Africa Arch Bishop Tutu said, “we have come a long way, but this will go up in flames”. President of African Development Bank, Donald Kaberuka, has argued that if we ignore the dangers of wealth disparities the consequences will be far more distressing than a few sleepless nights for the wealthy. I have argued in this column that the staggering income inequality in Kenya could append social upheaval, exacerbate violent crime, stymie economic growth, corrupt politics and undermine our fragile democracy.

In his Apostolic Exhortation released in November 2013, Pope Francis wrote; “Some people continue to defend trickle-down theories, which assume that economic growth, encouraged by a free market, will inevitably succeed in bringing about greater justice and inclusiveness in the world”. Rising economic inequality, despite unprecedented growth, especially in the global south is the most urgent challenge of our time.

Achieving inclusive growth was one of the nine programme sub-pillars of the 2014 World Economic Forum. This year, in a message delivered to world’s business, political and civil society elite gathered in Davos, the Pope noted that while economic prosperity yielded remarkable poverty reduction, it often led to widespread social exclusion. Pope Francis urged the global elite to draw upon the great human and moral resources and to tackle inequality with determination and far-sightedness.

That inequality was high on the Davos 2014 agenda is heartening. However, Davos is an embodiment of a self-interested global oligarchy. They can achieve little beyond eloquent and impassioned appeals. Global advocacy is necessary but tackling inequality demands dogged local action. Kenya’s bewildering inequality must occupy the center of our social policy debate. This debate has failed to gain traction. The scale and depth of inequality in our society is an inconvenient truth, especially among the privileged middle class and the wealthy business, political and academic elite. But we can do better when we are less unequal.

Last year, Society for International Development released a report Exploring Kenya’s Inequality: Pulling apart or pooling together? This report provides a petrifying account of the anatomy of Kenya’s inequality, driven mainly by extractive political and economic institutions. After reading this report, I concluded that ours is a tale of three countries: the obscenely rich country; the gasping lower to middle-income country, teetering on the precipice; and, the miserably poor country.

I imagined that the report would generate a dispassionate debate, given that the evidence behind it was drawn from the 2009 population and housing census. But there was no debate. Instead we got a discordant quartet; an activist, gotcha civil society, self-interested academic mercenaries, a caustic governing elite beholden to their own facts and a befuddled public.

At the age of 17, before completing primary school, Francis dropped out of his class of 85. He is now employed as motorcycle taxi (bodaboda) rider in Luanda Market in Vihiga County. There are hundreds of thousands of children like Francis who belong to the “lost generation”, excluded from promise of Kenya’s growth and prosperity.

Investing in our children is our best chance to break the vicious cycle of poverty and inequality. We must prioritize investment in high quality education and good teachers, social protection through conditional cash transfers, equitable access to finance, vocational training and skills development, support for rural agriculture and infrastructure and provision of health services. We owe it to Francis and his children. 

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