Special to the News-Register Ousmane Traore

THIS EDITION Volume 21, No. 4 Month 01, 2003

Front Page

The economics of democracy

Like many African countries, Gabon faces a terrible economic recession. Inflation and unemployment are high. The majority of the population lives in misery. The country’s debt is enormous. According to economists, bad management of the country is responsible for the catastrophic situation. A democratic regime is the medicine necessary to cure the diseases crippling the Gabon economy: lack of investors, nepotism that affects productivity and high spending.

The absence of investors, crucial for economic growth, is visible throughout the economy and is starving the life out of every sector of activity. The principal cause of this problem seems to be the current regime in power, characterized by an absence of democratic institutions. International observers found evidence of fraud during the 1993 presidential election. Forty years of having an unstable regime has caused a loss of trust among past investors and an inability to attract new ones. Investors want to be assured that their investments are safe no matter what political changes could happen; therefore, they would rather invest in businesses located in stable democratic countries.

Furthermore, democratic institutions would positively affect the productivity of the country by decreasing the amount of nepotism. Productivity is one of the most important factors in determining the health of an economy. In Gabon, the productivity rate of services and local industries is horrible, mainly due to the fact that people are hired or receive advantages just because of their acquaintances with the president or his family. Government and industries are inefficient because there are people working either as ministers or managers of companies for decades regardless of their aptitude. Some of them have not even received a high school education or have any management experience.

Education is also affected by nepotism. Students are given scholarships to study in France, Canada, and the United States regardless of their grades. These students often fail to get their degrees, putting to waste the money of their scholarships.
Democratic institutions such as a congress would work to restrain the spending of the country. The International Monetary Fund (IMF) considers the spending of the country to be a severe contributor to the poor economic situation. The democratic congress would first be able to adjust the political spending of the country. Gabon has fewer than one million persons, but has as many state secretaries as other, more crowded countries do. It also has two legislative chambers with similar attributes. Political functionaries are generously paid and do not pay for taxes, rent, cars or the gas to drive them. A secretary, senator or deputy may earn at least five million CFA a month while the minimum wage is only 50,000 CFA a month.

The congress would also have the duty of overseeing the management of the government’s money. The president is well known as a wealthy person in Switzerland; he is also the only manager of the economy and the revenue of the country is considered his. Gabon is well known for inexplicably lost funds.

Everybody uses government funds to finance their activities. In the past, many secretaries have been involved in stealing funds. The government is also losing a considerable amount of money because of “ghost agents.” They are government agents who are paid to work for the country even though they have never once done actual work for the government. A similar category of “ghost agents” are those receiving two or three paychecks from the government each year. These people are supposed to receive only one, and work at only one place, but they are also declared as workers in other groups from which they receive additional paychecks. A study in 1998 discovered thousands of people exploiting the government and receiving salaries in this way.

In brief, a truly democratic regime would usher in sweeping changes that could turn back the tide of economic recession. It would lead to a democratically elected president. Investors would trust the country and create companies; the president would be obligated to perform. Increased productivity and efficiency would come when nepotism and graft were reduced. Institutions would oversee the spending of the country in order to save a considerable amount of money that normally goes to
political rewards or waste.

(Ousmane Traore is a student in Dr. Seeley’s English class.)