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Opinions of Thursday, 24 January 2008

Columnist: Agbodza, Kwami

Let Us Emancipate Ourselves from Free Market Ideology

So what is the free market ideology? It is an economic ideology that pretends to be rooted in an economic theory of ?free markets?. But is there anyone who does not want free markets? I doubt it. Or to put it more broadly, is there anyone who does not want to be economically free? So if we all want justice and freedom, why have think tanks found it necessary to convince us all that we need free markets and freedom? Are they like Evangelists out to save us?

Today, majority of Ghanaians believes there is no alternative to free markets. As do the politicians.

Even the National Democratic Congress (NDC) asserts in their party philosophical document that they believe in free markets. As for the NPP, they have always believed in free markets. This explains why they rejected the democratic path then and started planning coups as far back as 1958. Do Ghanaians not notice that people who love the use of political violence in economic governance are the same people who adhere to the delusional suggestion that free markets and democracy go hand in hand?

So what do they really mean by free markets? When you ask they quote you theories. Here are some of them, many of which can be found on the web.

One says it is ?a market in which supply and demand are unregulated except by the country's competition policy, and rights in physical and intellectual property.? Have you noticed what I have?

Another says it is ?one in which any individual may exchange their products or services by competitive bidding, open to all, without constraint.? Really, when did Ghanaians last remember one of these in private or public contracts?

A third says it ?occurs where there is little or no regulation of commercial activity by government.? Really, then how did the law on poultry change?

A fourth defines it as ?a market where the price of an item is arranged by the mutual consent of sellers and buyers, with the supply and demand of that item not being regulated by a government.? This is in contrast to ?a controlled market, where supply and price are set by a government.? So is this how the prices of our export commodities are determined?

So which of Ghana?s products that earn us serious foreign exchange go anywhere near these definitions. Take gold. Do AngloGold Ashanti and other oligopolists not control it? In what sense is there even a gold market in Ghana never mind that it is free. And if a gold market is in Ghana, is it a free market? If the free market is such a wonderful thing why is the market in gold not free? So free market that we even have a serious Gold Industry that produces Jewellery than can earn enough income to pay the education of all of Ghana?s children to university level? And even if we do not want it to be controlled by the state, why has a serious Ghanaian Gold Industrialist not emerged? And since Gold is found in specific areas of Ghana, why have a Gold Industrial Family not emerged? So there is your Free Market through the window for you!

Take any other serious industry in Ghana? Shall we say Timber? Again is it free? So who controls the timber industry in Ghana? Do Ghanaians know since it is a free market? Indeed do Ghanaians know what happens to all our resources and who benefits from them since it is a free market?

All serious economists know that a free market economy does not exist? And even if there is one, it is ?where the market is relatively free, as in an economy overseen by a government that practices a laissez-faire, rather than either a mixed or statist economic policy.? So it must be clear that Free Market Ideologues are not against governments overseeing the economy. What they are saying is that it must be in their interest. And in Ghana the serious and most ?vociferous?, shall I say silent, Free Marketers are all foreign governments and their embassies; they also happen to control the IMF and the World Bank. They also anti-democratically control the UN Security Council. That is your free market! They break international law when it suits them and overthrow sovereign governments on pretext of lies.

They will claim that the political corruption of Ghana where a President can buy a hotel of greater value than his entire presidential income while in office is the justification for non-state intervention. It is the same with officials like Edumadze and many others. They will argue that it is precisely this statement by an aspiring president that ?I did not go into politics to become a martyr; I went into politics to make money to take care of my family and friends!? that most clearly demonstrates their belief. The economy must be free. Clearly then they hate competition from politicians.

But those who come to office and enrich themselves at the expense of the electorate are politically corrupt. And it can be argued that it is morally wrong; and if there is a law that prohibits such behaviour they can be jailed. But it is the same with businessmen and industrialists who also come to office and give favours to politicians to pass laws or break the law or smoothen their way to make money and pay little or no taxes. Both are wrong, I mean morally.

And this is why it must be clear to all Ghanaians that when we are told that the State must only create an enabling environment for the private sector; there is more to it. What they really mean is that both politicians and free marketers are out to swindle the electorate, but the politicians must leave the free marketers to do it unhindered.

But who in his or her right mind will make it easier for someone else to steal without a reward or share of it by fair or foul means? And so if the politicians must enable free money for the free marketers then they the politicians too must have their %. And this is the free market game.

What happens to jobs and a decent life for the majority of the people? It is not our problem the politicians scream; ask the private sector. It is the job of the private sector. Then when you ask the private sector they also argue that they cannot create enough jobs because the markets are not free enough. By ?not free enough? they mean the politicians are taking too many percent. So they cannot make enough money to create enough jobs. So more Free Markets is the answer. Even one wants to create millions of small businesses; he calls it indigenous capitalism.

Who are the losers? It is the majority of Ghanaians who shall remain in poverty. And this is why we must emancipate ourselves from slavery to free market ideology. In Ghana it means the free market and the politician should share the wealth that is created. And they are the few. But we are the many!



Views expressed by the author(s) do not necessarily reflect those of GhanaHomePage.