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The making of ‘Kibakinomics’

Discussion in 'Kenyan News and Politics' started by mwitaz, Jun 26, 2012.

  1. mwitaz

    mwitaz JF-Expert Member

    Jun 26, 2012
    Joined: Feb 19, 2012
    Messages: 314
    Likes Received: 4
    Trophy Points: 35
    By MORRIS ARON and

    He was once a carpenter.
    Then he tried his hands at
    the exacting masonry.
    When all was not enough
    to take care of the bills, he
    even had a stint as a tout in the defunct Othaya African
    Bus Union fleets.

    From Mwai Kibaki’s early
    experience in the tiny mud
    hut they shared as a family
    to the sore nights in an
    uncomfortable wooden
    bed only made a little comfy with hay in
    boarding school, the
    capitalist in him emerged —
    resolved and steeled.

    In the early school of ‘hard
    knocks,’ Kibaki picked one
    vital lesson that endures to
    date — that to make a
    living, one must work

    This thinking is the very
    epitome of Adam Smith’s
    book The Wealth of
    Nations that forms the
    basis of modern economics.

    Kibaki graduated from
    Makerere University with a
    First Class BA degree in
    Economics, History and
    Political Science.

    He earned a scholarship to
    the prestigious London
    School of Economics where
    he graduated top of the
    class with in MSc in Public

    Those looking at
    explaining Kibaki’s legacy
    say with such credentials,
    there was no denying he
    was destined for great

    But now as Kibaki readies
    to retire from politics as
    Head of State, economists
    will be posing the hard
    questions. What exactly is
    Kibaki’s economic legacy? Was it all worth the effort?
    Boiling Kibaki’s economic
    philosophy down to bare
    essentials, James Shikwati,
    Director of the Inter
    Region Economic Network, described him as Adam
    Smith’s half-hearted
    disciple. Wild consumerism
    “While they both placed a
    premium on hard work,
    Kibaki as President
    presided over the growth
    in wild consumerism, credit taking and huge deficits —
    contrary to Smith’s school
    of thought,” says Shikwati. In his book, The Wealth of
    Nations, Smith challenged
    people and nations to
    practice not just hard
    work and enlightened self-
    interest but also thrift.

    Under Kibaki’s regime,
    however, Kenyans have
    witnessed more empty
    grain stores at both
    national and village level,”
    Shikwati, described by Wikipedia as a libertarian economist, says. “The country’s surging appetite for luxury is
    epitomised by the many
    shopping malls dotting
    streets in cities, increasing
    number of fuel guzzlers on our roads and the craze for
    palatial homes,” he says,
    adding that the fact that
    Kenyans are rushing in for
    credit cards point to
    expenditures that outstrip income and dwindling

    Aly Khan Satchu, a Nairobi-
    based investment analyst,
    shares in Shikwati’s
    sentiments, saying Kibaki’s
    administration has failed to
    take a knife to the recurrent expenditure.
    “In fact, this year for the
    first time — total projected
    revenue (Sh956.9 billion) is
    less than the recurrent
    spend as captured in the 2012-2013 budget (Sh1.45
    trillion),” Satchu says.

    Dr XN Iraki, economics
    lecturer at the University of
    Nairobi, says throughout
    his tour of duty, Kibaki stayed on course in his
    economic philosophy —
    following the Keynesian
    model all through. That is,
    save for the tidings of
    politics. Keynesian economics
    advocate active
    government intervention
    in the marketplace —
    including determining the
    size and rate of growth of the money supply, interest
    rates — as the best method
    of ensuring economic
    growth and stability.

    Source: The Standard
  2. mwitaz

    mwitaz JF-Expert Member

    Jun 29, 2012
    Joined: Feb 19, 2012
    Messages: 314
    Likes Received: 4
    Trophy Points: 35
    In 2005 during the
    height of the 1st
    referendum, when the
    "adui motto" train was
    just coming into
    town...kenyas GDP per capita was just $500 per
    person and our budget
    was partly funded by
    donors....well according
    to the U.N a country with
    a GDP per capita of $1000 plus is considered a
    middle income
    country....Kenya is on
    schedule per IMF to reach
    middle income status by
    2016, if it maintains, just a 4.5% growth rate per
    yr till then, with an
    estimated GDP per capita
    of $1088 per kenyan, I
    repeat per KENYAN not
    just kikuyus...and 100% kenyan funded
    Europe and doing
    business with china was
    total genious Europe is a continent in need of
    massive bailouts...oyeah
    Spain just got another
    bailout of 100 billion
    euros on saturday, next
    will be Britain or Italy...and China is where
    the begging bowl is times
    change, mmhh...