An opinion piece by Thomas Friedman, published in the New York Times last week, offers some very vital lessons for political regimes worldwide on the importance of unity in the face of national crises. Headlined “Win Together or Lose Together”, the piece pricks the conscience of the squabbling politicians in the US in the wake of dwindling economic fortunes, following the downgrading of the superpower’s creditworthiness.
Friedman’s piece, I opine, is the one of the most powerful editorial pieces so far written anywhere in the 21st century, for it contains vital lessons about national crises, political unity and the national interest for all nations, particularly Kenya. Regarding America’s current economic crisis, Mr Friedman, author of the famous book The World is Flat, cautions: “Something this big and complex cannot be accomplished by one party alone. It will require the kind of collective action usually reserved for national emergencies. The sooner we pull together the better”.
The far-reaching implications of the downgrading of the US economy’s creditworthiness a week ago are mind-boggling. They constitute a latent global crisis. The verdict was passed by the global sovereign debt ratings firm known as Standard & Poor’s. The firm cited the US budget deficit, the biggest in human history, and the internal political climate as the main reasons for the low economic status.
The downgrade was met with massive criticism and assorted cries of pain from the Obama administration. The US still has an AAA rating from other global sovereign debt ratings agencies. But the fear remains that one or two of them could follow Standard & Poor’s unprecedented lead. The United States is the world’s biggest economy at a GDP of US$15.003 trillion (at July 29, 2011, according to an International Monetary Fund (IMF) estimate).
And yet America came within an inch of defaulting on its debt a week ago. It is also the single largest debtor on this planet and in history, for purely political adversarial reasons. Only the 27 combined economies of the European Union generate a bigger GDP, calculated by the IMF at US$16,228.23 trillion in 2010.
The EU’s biggest economy is Germany, at US$2.4 trillion, followed by France, at US$1.9 trillion, and the United Kingdom, at US$1.6 trillion. Africa’s combined GDP is only equal to the UK, at US$1.6 trillion, although this continent of a billion people has a potential greater than that by far. According to the latest (2009-10) IMF figures, the richest three African countries by GDP generation are South Africa (US$ 357.259 billion), Egypt (US$ 218.466 billion) and Nigeria (US$ 216.803billion).
Thinking about billions is hard enough for the vast majority of ordinary folk. But trillions are simply out of this world. For instance, an hour has 60 seconds, but you are not a billion seconds old until you are 32 years old, which means the vast majority of Kenyans now alive are not yet one billion seconds old.
This also means that famous old-timers like Nelson Mandela, who is 93, Charles Njonjo, who is 91, and President Kibaki, who is a comparative youngster at 80, are not yet three billion seconds old. But a trillion simply boggles the mind. If America had defaulted on its debt, the world economy would have been in a truly terrible mess. And yet it almost happened, largely due to the age-old political rivalry between the Democratic Party, which is now in power, and the Republican Party.
The size of the US debt is simply staggering. As of August 3, 2011, the gross was $14.34 trillion, of which $9.78 trillion was held by the public and $4.56 trillion was in intra-governmental holdings. Wikipedia defines the US government debt as “… the money borrowed by the federal government of the United States at any one time through the issue of securities by the Treasury and other federal government agencies”.
The US public debt “… is securities held by investors outside the federal government, including that held by the Federal Reserve System and state and local governments. This is the net public debt”. A week ago the Republican Party almost pushed the US into defaulting on its debt repayment pledges, a move that would have had catastrophic economic and social consequences across the planet. The single biggest holder of US debt is China, with more than US$2 trillion.
Part of the Republican Party’s intransigence on the matter was driven by what can only be called tribalism writ large. Some Republicans have never forgiven themselves for the fact that the party lost the 2008 presidential election and that the majority of Americans elected the first African-American, Barack Obama, as president.
The racists inside the Republican Party were completely reconciled to the idea of the US defaulting on its vast debt and throwing the world into a tailspin of crises. And all this only to make the puny, petty, petulant and repugnant point that it happened under the watch of a black President. Mr Friedman’s call for united bipartisan political responsibility at a time of national crisis is instructive for its level-headed definition of the problem:
“Our slow decline is a product of two inter-related problems. First, we’ve let our five basic pillars of growth erode since the end of the Cold War – education, infrastructure, immigration of high-IQ innovators and entrepreneurs, rules to incentivise risk-taking and start-ups, and government-funded research to spur science and technology”.
This, indeed, is the tenor and language of Vision 2030, Kenya’s own national economic and development blueprint and road map towards a middle-level economy. America’s current economic crisis and Friedman’s timely caution are enough reasons why Kenya must ring-fence the Vision 2030 and all its flagship projects against petty political squabbles!
(The writer is the Information Secretary, Ministry of Information and Communication)