In the wealth of nations…where is our Kenyan pie?

In 1776, Adam Smith wrote about the power of the “Invisible Hand” as the secret behind the wealth of nations.

He may never have imagined how his revolutionary economic thoughts would cause distortions and disparities in the distribution of the world’s wealth.

His dreams for every individual to freely pursue their economic interests with less of the distortions of government interference and taxation remain as true today as they were then.

It is this philosophy that thrust and has sustained the USA into economic stardom since 1945.

But what is this invisible hand and what is its relevance to the economic discourse going on in the country?

Today, we understand Adam’s invisible hand to be the creative capacity of each one of us and collectively as a nation. Simply put, no individual can ever accumulate more wealth than his or her mind has ever conceived.

Similarly, no nation can ever accumulate wealth beyond its collective creativity or its leaders have ever conceived.

In theory, a country can borrow infinitely for as long as its economy expands faster than its public debt. In other words, the true limit to how much we can borrow as a country is our individual and collective creative capacity.

This is where the difficult solutions to our debt problems lie. Raising taxes to pay debts can only result into one outcome: Economic ruin in the medium and long term.

Let us now turn to the time-tested and sustainable solutions to our economic woes.

First, Kenya’s economic growth and development is the sole and sacred responsibility of Kenyans through their creative capacity. The Americans build America, the Chinese build China, the Japanese build Japan, the British build the Great Britain and the Singaporeans build Singapore.

Geo-economic and political engagements must be driven purely by national interest and the sovereign will of the citizens. Such engagements must be on our own terms and not those of our benefactors. No solutions shall come from the West or the East.

Second, we must re-engineer our minds and take pride in our nationhood. Our patriotic obligations must not only be read in our constitution, but must transcend our commerce and industry.

We must realise that it is not a sign of class to consume foreign products at the expense of equally or better alternatives within our territorial borders.

Third, we must reform our education systems. Spontaneous declarations and rushed re-ordering of school subjects does not evince education reforms.

Any national education system must be interwoven with the long term goals of the nation. It must embrace our economic diversity, identify and nurture each and every of our individual and collective talents and transmute them into multi-billion dollar empires.

Fourth, policy and national planning must never be about short term issues and political populism. While I am not essentially opposed to President Uhuru Kenyatta’s Big Four agenda, I am hesitant to dance to its tunes. I would rather dance to those of Vision 2030, whose economic outcomes are more visible and believable.

Fifth, we must reboot our economy from cronyism to market mechanism. When our forefathers erred into rewarding “tribe” and political correctness instead of creativity and merit, they set the stage for modern day tenderprenuership.

Sixth, policy choices and decisions must be evidence-based. Looking at our national and county budgets, there is nothing to show that our bureaucratic establishment believes in research-based decision making processes.

Individual ministries and county departments have no research allocations and our Monitoring and Evaluation departments are among the least funded if and where they exist. This can only lead to one thing: Policy choices that are either reactionary or based on conjecture.

The economic realities we face today call upon the nation’s top leadership to summon the magnanimous genius of Abraham Lincoln to heal the nation from its trauma of internal tribal and political conflicts.

It needs the insights of JF Kennedy to dream and see a beautiful world beyond; the resilience and sobriety of Nelson Mandela to re-awaken the spirit of nationhood; and the rallying cry of the audacity of hope of Barack Obama to collect ourselves from the disillusionment.

And there Mr President, lies the true window of opportunity to cement a lasting legacy!     

Dr Patrick Muinde is an economist