Wednesday, August 28, 2013

NEVIS Review No 24, Section II , Ref# 24.2

NEVIS Review No 24
Section II ( Danny Arku’s Section)
Ref# 24.2

August 28, 2013

[Danny Arku’s original post, March 28, 2012 ]

People emphatically assert they want to see development in their country, and yet in the same breath, they vehemently oppose any kind of changes- they don’t want to be “disturbed”, they don’t want to leave their house in order that new roads are to be built passing through their houses; they don’t want to move away from their birth place (“etbite yetekeberebet”) in order that large scale plantations are to be set up; they are not ready for the forests to be cleared. These people fail to realize that development is a “disturbance”; development is-to borrow a word from the famous economist, Schumpeter-a “creative destruction”! There is always a price to pay in every effort-is there any public policy which satisfies ALL the citizens?!
The best one can argue is not “I don’t want to see a bulldozer around”, or “I want the forest not to be touched forever” but rather, whether the specific project is intended towards maximizing the “general welfare” and whether the policy is overall conducive to social welfare, and whether the relocated people are given the appropriate compensation, and whether it is done in such a way that no human rights are violated..

Mesfin Tekle :
Danny Arku, There has never been development without its related cost. Whether it's removing people or property from one area to another or everything else in between development is not cost free. The question one must ask is about transparency. How transparent are the decisions made and whose interests have priority in a system where the one asking the questions and the one answering them is one and the same?
Danny Arku:
Mesfin Tekle, thanks for understanding my point. I agree with you that transparency and persuasion are really necessary.
Beza Hailemariam:
We've heard all that over and over development.... Are the people being compensated for the land and house they are losing? Are they being offered better living in a new place? I don't think so.... So if you are promising development while destroying one’s life, you just end up re-destroying the development you finished building
Beyo :
I want to add some points:
1: We don't even agree on the meaning of a country?
2: We can't differentiate party policy and national interest?
3: I don't know about other countries practices but in our case we use everything to oppose the government?
Such intrinsic issues are the real reasons behind, rather than agendas of development.
Other critical factor which openness gaps is weak government workers (Civil services),either due to lack of capacity or intentionally hampering the process. Eg: In compensation process, valuation has to be made by some civil servant, but had he may report it negligently to the one who allows to pay (political decision maker), the end result will obviously is catastrophic. This case happens in many situations such as sugar price fixing, condominium housing development, and many more.
Daniel Seifu:
Danny Arku, I think as most of us may agree....the question is not about "I don't wanna see bulldozer" and development but rather the question is about the following process. Some of the points are said by you and Beyo about "civil services" .But in addition to that, it needs thorough investigation of what the relationship between all stakeholders look like, before just saying by a guess (that is also equally ignorance).One certain fact for me is that about one of the biggest problems but frequently ignored is the one you said “etbite yetekeberebet”. It has many things in it, it has several emotions of belongingness... I don’t think that I have a good skill to express it very well but I think there are good ways to handle it than just sending cadres who harass and intimidate the "victims of development" by telling them emotionally that this is "development".......What do you think about sending "social counselors" with bulldozers? And who listen and help in the process.......ግን ምን ዋጋ አለው s Civil service jobs and positions ምናምን ሁሉ ፖለቲካዊ ሲሆኑ.....ከዚህ አይነቱ ህመም በላይ ምን ይጠበቃል?
Daniel Seifu , To get to the bottom of the barrel, the issues won't be solved had we send "social counselor", because it is not that people demanding. It is all about political polarization which is hampering the process of development. Had you send "a social counselor" they will tell you another reason because "were yefetaw" .So the only way the government and the one who cares should work to really hear what is at stake and work as much as they can, without giving things any political back and forth. May be you are right in indicating weak "political cadres"(NOT ONLY EPRDF, BUT opposition PARTIES TOO) are part of the problem. If there is a ZOMBI cadre which only tried to implement things without trying to actualize and understand issues at hand, but he work on it only for obedience of political leadership then the result will be much much lower than expected. What did other opposition party political leadership towards indicating the universally right solutions, or in real political solutions. Dear Dani,it is all about lack of engagement of the elites in the development of the country.

Berihu Assefa :
Danny Arku , you brought up a good issue to discuss

(1) Is this the case of Arrow’s impossibility theorem: “there is no social welfare function that satisfies Non-dictatorship, Efficiency, and Independence?”

(2) True that there are gainers and losers of development policies. This is a distributive conflict. In such cases, the famous principle “the social benefit must outweigh the social cost” is not enough. You need a “political process”. What political process? Since the losers have a legitimate claim (and vote) not to get displaced or to get a full compensation on their loss, one needs a justifiable resolution of the distributive conflict. The political process is most likely “justifiable” when it is democratic. If not democratic, is there any other mechanism to address the questions raised by Mesfin' above.

(3) But what is development? Its definition and scope has so much expanded. The most comprehensive definition is, perhaps, Sen’s definition (development as capability and development as freedom). Sen wrote: “Development is the expansion of individual freedoms”. In authoritarian states, Sen’s development definition will be something like this: “Development is the expansion of public works (roads, dams, etc).” But individual freedoms may conflict (some oppose and others support). What happens when they conflict? What happens depends on whether you are authoritarian or democratic. Though, both can lead to sub-optimal outcomes, the latter has better aspects of reflecting people’s will. To do democracy is to do the right thing; but it doesn’t necessarily mean democracy is just or superior. A democracy can be nastily unjust and economically inferior.

(4) How do individuals decide? Man is rational. She compares her individual benefit with her cost. Does she calculate the social benefit and social cost to decide? When a road that affects my house is built; do I calculate the social benefit and social cost to vote YES or NO? How is this decision different from going to a college? When you want to go to college, do you compare your costs with your expected benefits? Or social benefits with social costs? Education has positive externality.

(5) Schumpeter’s creative destruction: I am not sure if you can apply his concept to public investments (when a government demolishes a house or a village). Originally, he meant it to refer to the death of uncompetitive businesses (or economic forces). The competitive world goes through creative destruction where economic forces determine the surviving and non-surviving.
Daniel Seifu :
Berihu, when you say "but what is development?" that is what makes me most of the times to be reserved, especially Micheal Todaro's the three core values of development comes in to my mind

1, Sustenance : The ability to meet basic needs

2, Self-esteem : "to be a person" (sense of worth and self are included authenticity, identity honor, dignity, respect,....)

3, Freedom from Servitude: to be able to choose (he put this one to be understood as emancipation from alienating material conditions of life and from social servitude to nature, ignorance and several others...)

so if these are the core value of development then, isn't that wrong to ignore peoples cry? I mean isn't that better to address their cry as equal as the development?

Isn't that possible to build and develop with integrity and respect? (Listening to others opinion no matter how it seems wrong causes that is development by it self....isn’t it?)
Beyo :
I may agree somehow with your points but don't you think you are generalizing and concluding when you say " It is all about political polarization", I mean don’t you think that conclusion would limit to listen to genuine outcries?
Tsedi Lemma:
Danny Arku, In addition to the points made by Mesfin (who often for pleasant reasons speaks my heart and my mind better than I think I do) and Danieln Seifu - whom I like for his viciously straightforward comments, I have one very simple question to ask, can development be brought upon people without the stern attitude of "either or?". Can we find a delicate equilibrium to strike in our ambition to grow? Danny Arku, I know you have many questions by Berihu to answer first.
Danny Arku:
Thanks all for your comments, this is the kind of discussion that Ethiopia needs. Free civilized discussions- disagreements, and agreements-but still continue to be friends. @ Be Yo, thanks for your comment. I have repeatedly written notes on the fact that we have to transcend the parochial party affiliation and focus on the objective content of any issue at hand- I am against any kind of ethnic-political polarization. I agree with you that lack of capable technocrats, or civil service, to use your term, in Ethiopian government. That is where the government is weak. Asset Valuation is so technical in nature that it may be better left to technocrats. In case it is undervalued, there should me grievance handling procedures.@ Daniel S, I like your sensitivity to the displaced ones, when you cited the social counselors, although I don’t know if that would be practical in our country. HOW one tells you are to be relocated also matters, ie. Convincing them regarding the advantages of the project may help in that regard. Harassing should at any time be avoided. If you see at the end of my note, human rights is one of the items which I pointed out as worth discussing. So I didn’t disregard it. @ Beza, BTW, I didn’t claim the compensation was enough-Indeed, I was implying that the adequacy of compensation is one of the questions that a reasonable person should ask. The people I was resisting vigorously, whom I was intentionally labeling them “hypocrites” are those who try to argue that people should never relocate for whatever the reason, however noble the intentions are-those who categorically state that we don’t need that kind of development if it displaces people, and dismiss any development endeavor as futile ipso fact
Beyo :
@ Tsedi Lemma your point is good and needs to be considered, we need to find a delicate equilibrium to strike the balance, this should be done, but Ethiopia's problem is multidimensional, in some cases we can't have the luxury to accommodate all what we think is right, We are forced to do it, to the extent that its quest is a matter of our existence too. I hope you can accept anything had you believe we for sure banish hunger for example? Even if there is a stern resistance on it, then why should I listen to it, because waiting can harm my existence too? @Daniel Seifu , Okay, we agreed on some of the aspects then, when there is a genuine claim how can we hear it? 1. Identifying the positive claim? For this, the task should be started from the one who claims his own right, which means he has to ask first what he want and what is his real demand. Like when the government wants to build a dam and when his farm can be affected by the development work, t hen he has to ask for A PROPER LAND FOR FARMING, not "etebete etetete,zere manzere" ,or attached to it some kind of silly political agendas, because a dam is not for a single family rather for a country(the peoples in it).2. Civil servants and experts for the Government, rather than working on the political side of it, they have to engage themselves in realization of claims and problem solving, which is to say, whether one has claimed with truth or with external agitation, they have to practically engage on solving it. That is, when one claims about environmental damages on Dam construction, then they have to take it seriously and devise ways to minimize on the damages on environment without halting the project successes. To conclude, attaching political agenda with real developmental quest doesn't take us anywhere and sizing to develop is unimaginable but apart from it everything is possible with dialogue. @Mesfin tekle 1. "To do democracy is to do the right thing; but it doesn’t necessarily mean democracy is just or superior. A democracy can be nastily unjust and economically inferior."...What is right? Being hungry is right? Or putting a chunk of your country men in poverty is right? I prefer to live like Somalia than India.2. Man is rational...towards his and his own benefits. Man is also social; one’s existence depends on other. One can claim a replacement for his residential area and residence for his demolition house due to road project, because it is a matter of existence but he can't claim about the places benefits had he sold it, because he never add a single value on the place existence or his ownership of a land is just out of sheer chance, so some man are self-centered may approximate that.
Danny Arku :
I can understand your ecological concerns, but there is always a trade-off in economic decisions. Take China for example, it is being condemned for environmental degradation. I don’t mean it should disregard such claims but it could turn out to be inevitable outcome-and the West who cry about it are the ones who has been polluting the earth for decades- why cry , why all fuss when it comes from China, or other non-Westerns countries. Either a country has to lower its rate of development (number of industries...) with less pollution, or grow at higher rate with some relatively higher pollution. Furthermore, negative externalities on third party may perhaps be handled by the government through different mechanisms. It is good to balance both whenever that is possible, as Tsedi remarked, but it should not be at a high price of economic growth. I hope this would also answer the question that @ Tsedi brought.@ Berihu, I agree with your points 1, 2, esp in the third, you have made a good point, esp for some who argue that democracy is a panacea for development, and those who think that democratic deliberation cannot result in suboptimal decision. On 4) Do you mean people displaced do not take into account social costs and benefits, the positive and negative externality of their action on third parties? The utility function of individuals would of course differ, but individual’s desire may sometimes be sacrificed, or MADE COMPLY, for the sake of long term prosperity even if the person concerned fails to realize the social cost and benefits. On point 5) I used the concept of Schumpeter’s “creative destruction” to make a parallel reasoning with nature of development (that is constant “change”), ie, to imply the fact that economic development like capitalist system, involves perpetual changes and upsetting forces. The origin of the term is NOT, respectfully, as you claimed, but it is rather, as we find it in his book “Capitalism, socialism and democracy’ where he asserts that capitalism as economic system is replete with constant change, where, to directly quote him, “capitalist system incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one. This process of creative destruction is the essential fact about capitalism”
Berihu Assefa:
Danny Arku, On 5: The parallel reasoning: development as a constant change Vs capitalism as a constant change is fine. What I said on “creative destruction" is not that different from what you said. If I were to put Schumpeter’s creative destruction bluntly, I don’t think it would be any different from what I put it in my previous comment. Creative destruction refers to the non-stationary nature of capitalism. The forces of competition lead to innovation. Then, others follow the innovative pioneers. Then, innovation again. This happens incessantly. It is a cycle – replacing old ones with new ones. Why do old (old means in this case uncompetitive – old product, old technology) ones die? The forces behind this cycle are forces of competition
Danny Arku:
Berihu, you said "Originally, he meant it to refer to the death of uncompetitive businesses (or economic forces). The competitive world goes through creative destruction where economic forces determine the surviving and non-surviving."It is matter of focus/precision. As you can clearly see from your text, in your interpretation, you are emphasizing on the 'survival of the fittest'-which is the more competitive will survive and the less competitive will be wiped out. But my emphasis was, as Schumpeter clearly stated it by saying "incessantly destroying the old one, incessantly creating a new one “ is on innovation and entrepreneurship. If you read the chapter on his book, he is referring to innovations, ie, the changes in product features, new technologies, new markets(eg foreign markets) which will continue to make capitalism to constantly evolve through time
Beyo Te :
Tsedi Lemma, What should you expect from a government official as it seems unless you grab power or office you swear that there is no agreement that you make any of the things around, at least you do not believe that you can contribute things without assuming any office. I feel sorry, not only for you but most on their resentment towards the country. I wish we can work on things, on projects and on agendas towards a common goal, at least we can contribute a positive advice. One should better say,” we can do it this way, or that way? or it is better had we done it this way.” rather than “AKURFO Kemekemet” .Rome never been built in a day! People stick with liberty which they never see it in their own house, but when it comes the public they expect to see it from where ...Alien? Much respect with a lot of regrets.
Tsedi Lemma :
BeYo, I think what we are doing here on FB is in a way contributing immensely without holding a government office. For one thing I never thought I am the right person to be a government official; we all have our own places in this world and I believe mine is not there, yet. You never know though. And I only have respect for our civilized "fights" here on FB and no regrets at all and I don't understand why you should regret it either. FYI, its people's civility in their engagement that helped Rome not only to be built but to be built better. Some wars might have been fought over that but at end what won the day were not the spears but people's civilized respect to one another and their tolerance of agreeing to disagree over many things. So I sometimes like, sometimes accept and sometimes respect what we are doing here and I like to keep the fire burning....even with so much petrol around.
Mesfin Tekle :
Beyo Te, Democracy is not a panacea! The gridlock nature of democracy can be frustrating but I believe it's better than the alternative. You've more transparency in a democratic give and take than without it. If you have a government dominated media barraging you with one truth without giving you the other side of the story, it creates an unfair balance. Of course, some of the opposition to development might be political but that is part of the deal you have to accept as a government, if you want the idea of transparency and factually based analysis to flourish.
Tesfakiros Arefe Sahle:
I want to ask Danny Arku about the planning process of the development projects. I hope he has the necessary information that can help him to answer my questions. When and how did the residences know about their eviction from their homes or the construction of the road that disturbs their lives? When & how did they know that the forest is to be cleared? Did the government involve the stakeholders in its planning process? Did they reach at consensus about the objectives of the projects (its social and economic benefits) and the method and amount of compensation, the place to be relocated? Did the government's project show the social, economic and political implication of the project? Did it clearly show that the cost benefit analysis and the economic benefits outweigh the social costs? Thank you
Beyo :
@Mesfin Tekle, I don't think it would add much value apart from extending the period of accomplishment. As I have indicated it before, the opposition won't come from the issues themselves rather from other agendas, and as a third world country we don't have that luxury. As of me, I don't want to see a stagnant economy because already in the big picture of humanity, we are already in slavery.
Danny Arku:
@ Tesfakiros, thanks for your insight. I think you are too focused on the means rather than on the end. You seem to imply that it is the means that matters most, and that end has to be sacrificed for the sake of the means, which is an absurd way of reasoning. I am not against a consultation- but this populist perspective assumes that the masses know what is best for them, and that if they can't agree, the course of action is not right. Berihu, Mesfin and I have already discussed how democracy may also result in suboptimal decision. I however, defend democracy because of its intrinsic worth, as I have previously argued on some note. @ Be Yo, I agree with you that consultation may turn out to retard a development process, or it might result in 'decision paralysis'. @ Mesfin, I think you have also to consider these facts, since transparency alone would not make a process fair- what is more important is 'who is the de facto decision maker?', whose interests are represented? A process may not be transparent but may turn out to be in favor of the masses, can’t it? Alternately, it may be transparent but may not be in the interest of the masses. Both ways are possible. Thank you all for your participation
(Ed’s note- It is hoped by NEVIS ET that documentation of such discussions would stimulate further thought and research on the issue and will serve as a knowledge database. We want to thank Danny and his friends for their reflection on such an important issue. As usual, the NEVIS ET’s disclaimer: we would like to remind NEVISers that all the opinions which Danny and his discussant express in the forthcoming series of articles are their personal opinion and do not necessarily reflect the opinions of NEVIS, the society or the editorial team ET. NEVISers who didn’t participate in the discussion are welcome to add their reflection here in this issue in the comment section. Those who already did participate are free to add/modify their opinion. We have presented the conversations above exactly as they first appeared for the sake of originality and authenticity, except for minor editing of spelling and grammatical errors. NEVIS ET*)