By Barii Ayano, Ph.D
The new rhetoric of the OPDO leaders and cadres is preaching about their plan to conduct an economic revolution in Oromia. They claim that they are already establishing several companies as part of the upcoming economic revolution in Oromia. The term economic revolution is bandied around without defining the concept and practically clarifying what constitutes an economic revolution. I argue that the OPDO leaders and cadres misuse the term “economic revolution”, with no supporting reality on the ground. The rhetoric has no direction, and it is never grounded in economic and political fundamentals that will bear an economic revolution that radically transform the economy.
There are no fertile socio-economic, political, institutional, structural, etc. factors that lay a foundation for a genuine economic revolution that will change economic welfare of the people in Ethiopia. A revolution cannot ensue and take root due to mere declarations and relentless propaganda rhetoric. The socio-political and economic conditions must be ripe to conduct an economic revolution but they are not conducive under the current state in Ethiopia.
Let me highlight the missing factors and links to undertake an economic revolution in Oromia (Ethiopia at large) in more details.
Economic Revolution: Subjective and Objective Conditions
A revolution is a sudden, radical, and complete change of the statuesque by admitting the current statuesque is an utter failure that needs a revolutionary change in order to be fixed. Equally, an economic revolution is a radical (rapid) change of an economic system and its structures. Economic revolution is a dynamic process through which a country’s economy, society and institutions modernize and move to more developed levels. An economic revolution is a revolutionary act that radically transforms the structure of the economy, including in institutions, ownership, economic policy, etc. that will radically alter the current economic structure.
Thus conducting an economic revolution demands a fundamental change in economic, political and institutional organizations and structures. There is no revolutionary activity or movement designed to effect fundamental changes without fundamentally changing and removing the socioeconomic and political conditions, which are bottlenecks to foster a radical (revolutionary) change.
OPDO leaders and cadres are entitled to talk about their plans to improve Oromia’s economy in order to better the economic welfare of the people. But it is farfetched and very unrealistic to describe it in terms of an “economic revolution”, given the political, economic, institutional, structural, etc. situations in Oromia (Ethiopia at large). As the saying goes, “The golden rule applies to those who own the gold”-not OPDO. Conducting a revolution requires favorable (ripe) subjective and objective conditions. Both conditions are missing in Oromia (Ethiopia at large). Even the structure of the current economy is not at a stage where it is conducive to conduct an economic revolution.
Political & Economic Dictatorships in Ethiopia: Intertwined Economic and Political Domination and Control
Ethiopia’s economy is heavily controlled by a small minority and their affiliates. Oromia’s (Ethiopia’s) market economy is controlled by the conglomerates owned by the TPLF and their affiliates. The first radical (revolutionary) transformation is ending the domination of the TPLF conglomerates like EFFORT in Oromia. The domination of the TPLF conglomerates in Ethiopia has not resulted from normal process of economic change. It has come through by design of the dominant element in the EPRDF (TPLF leaders). The agenda of OPDO to create new companies in Oromia has nothing to do with radical change (economic revolution). It’s merely creating companies that, at best, compete with the TPLF conglomerates that are already established and politically protected by the TPLF heavy weights. Given the nature of the political force that favor TPLF conglomerates, even the success of the new OPDO established companies is questionable, let alone opening the door to a new economic revolution in Oromia. There is no equal opportunity and there is no equitable share in the wealth of the country. TPLF won’t let go its agenda of dominating Ethiopia’s economy. It’s the core agenda of the TPLF leaders.
It’s important to note that a revolution (including an economic revolution) is mass empowerment and mass mobilization to achieve a certain goal. How is an average citizen to be brought into the picture and share equitably in the national product and national income, given the current structure? How is private ownership to be brought in line with such a vision, under the economy dominated by the conglomerates? Conflict of interests abounds without doubt.
There is no sin in boldly stating that there is no separation of division between politics and the economy in Ethiopia. Any rhetoric about such division is artificial and blinds us to certain fundamental economic and political realities in Ethiopia. An economic transformation that improves the life of an average citizen requires disentangling the intertwined politics and economy in Ethiopia. As it stands now, there is no distinction between political domination and economic domination. There can be no economic revolution without significant and fundamental change in the manner in which leaders administrate and manage the daily affairs and socioeconomic relations. To start, we must accept the premise that everything is based on social and political relationships in Ethiopia. Politics and economics are merely different expressions of social and political relationships: the social and political arrangements between people, government and people, and people and things.
Simplified, the fundamental root of existence is the right to life. The fundamental root of economic empowerment is the right to property (ownership). It goes without saying that the right to life supersedes all forms of human rights. Political reform and stability proceeds economic reform and stability. The TPLF/EPRDF regime does not manifest a stable regime even for a dictatorship but a paranoid regime that considers large chunk of the people as its enemies. The same goes for the OPDO in Oromia and hence it cannot create people-centered economy that benefits the mass, let alone a revolution.
There is marginal difference between political marginalization and economic marginalization in Ethiopia. The two are interconnected and interdependent under the TPLF/EPRDF regime. Political branding of successful individuals not affiliated with the regime as “narrow nationalists” and “chauvinists” has two dimensional purposes. Individuals branded with such classification are not only doomed in the political world but they are also doomed in the economic world of Ethiopia.
It’s also important to note that such branding of individuals is not only driven by the political goal of domination but also by the economic goal of dominating and controlling the economy. When the regime affiliated individuals want to drive out individual entrepreneurs from successful businesses and take them over, they run to their politically empowered relatives or affiliates to unleash ‘decree’ on individuals as “narrow nationalists” and “chauvinists”. It’s crystal clear that the TPLF leaders and their core supporters detest both political and economic competitions. They have die-hard commitment to be dominant in both political and economic affairs via unfair and cruel practices.
On the other hand, genuine economic revolution calls for unharnessing entrepreneurial skills, innovations, inventions, etc. via promoting economic nationalism and economic democracy without discrimination via free and fair competition in the economy. It’s an economic freedom that builds a solid foundation for an economy to build physical capital and human capital as the driving forces of capital formation that finance sustainable economic growth.
Surely, the current economic model in Ethiopia is in need of a new direction. Due to the consolidation of wealth, the majority of the population cannot generate enough income to keep up with the cost of living. Moreover, corruption, greed and economic inequality have reached a peak tipping point. The government is disorganized, wasteful, has no purpose and its policies — when they exist — are incomprehensible or devised by special interest groups with little regard for the welfare of the average citizen in Ethiopia. It’s not a people-centered economic model. A revolution needs overhauling the model.
Human Capital: Entrepreneurship and Professional Development
Human resources are important factors in economic development. Man provides labor power for production and if in a country labor is efficient and skilled, its capacity to contribute to growth will decidedly be high. A skilled workforce is an asset. This necessitates investment in development of human resources, so that a country can have a large skilled workforce contributing to its economy. Independent and skilled entrepreneurs dominate the economy where economic freedom prevails, including under developmental dictatorship.
However, it’s not entrepreneurial skills of individuals that dominate Ethiopia’s economy under the TPLF/EPRDF regime. Political affiliation and political interconnectedness are more important than skills. There is a direct link between access to politics and access to the economic resources (land and its resources, finance, hard currency, etc.). Political connection is the major driving force behind access to bank credit, which is an essential ingredient to start business in countries like Ethiopia with low individuals’ saving.
Speculative side of the economy, duty free (lower tax) arrangements, etc. is other sources of nepotism “get-rich-quick” schemes. Politically connected and protected individuals with no entrepreneurial skills become overnight millionaires through land speculation, “ayer-be-ayer” speculations, etc.
Even worse, the regime’s cadres want us to celebrate nepotism driven price-gouging of the land as the critical part of economic transformation. They celebratory write and speak of the record-breaking speculative lands prices in key areas as if it is tantamount to breaking Olympic records. Politics aside, one of the main goal (policy) of any sensible government-be it a dictatorship or a democratic government-should be stabilizing the prices of key resources like land since destabilized prices in key resources has far-reaching ramifications on the economy. Land prices are detrimental of other prices in the larger economy. Speculative price-gouging of land leads to an oligarchy (even a monopoly) control of key land resources by few companies via rent-seeking and political connections with easy access to bank credit. It drives other actors and individuals from the land market, which will add to the already existing limited and unequal economic opportunities for the majority of the people in Ethiopia.
Domestic Capital Formation vs. Dependence on Foreign Capital
Capital is one of the major impediments to economic development. A country not only has to generate capital, but also has to save it. The strategic role of capital in raising the level of production has traditionally been acknowledged in economics. It is now universally accepted that a country, which wants to accelerate the pace of economic growth, has no choice but to save a high ratio-of its national income, with the objective of raising the level of national investment. Great reliance on foreign aid (capital) is highly risky and unsustainable, and thus it has to be avoided. Economists rightly assert that lack of capital formation is the principal obstacle to sustainable economic growth and no developmental plan will succeed unless adequate supply of capital is forthcoming on a consistent basis.
Whatever the economic system may be in a country, a country cannot hope to achieve economic progress unless a certain minimum rate of domestic capital accumulation is realized. However, if some country wishes to make spectacular strides, as Ethiopia claims, it has to raise its rate of capital formation higher. Only then capital can be invested in a fruitful fashion and reduce dependence on foreign capital. Thus capital formation is one of the key ingredients for economic development. The stock of capital and the rate of capital accumulation in most cases settle the question whether at a certain point of time a country will grow or not on a sustainable basis. There are a few other economic factors which also have some bearing on development but their importance is hardly comparable to that of capital formation.
Capital formation is very weak in Ethiopia and it has meager capital resources due to low domestic savings in the economy. Let alone saving, the cost of living is unbearable in Ethiopia for the overwhelming majority of the people due to persistent inflationary pressure. Ethiopia is heavily dependent on capital import in the form of foreign aid, borrowing, remittances, etc. Foreign direct investment (FDI) is also becoming a significant source of capital. It’s unrealistic to envisage an economic revolution on a sustainable basis in Ethiopia, which is a country heavily dependent on capital imports, particularly hard currency.
People-Centered Economy and Economic Democracy
Mass participation in development programs is a pre-condition for accelerating the growth process. However, people show interest in the development activity only when they feel that the fruits of growth will be fairly distributed. Experiences from a number of countries suggest that whenever the defective social organization allows some elite groups to appropriate the benefits of growth, the general mass of people develop apathy towards state’s development programs. Under the circumstances, it is futile to hope that masses will participate in the development projects undertaken by the state.
There is no people-centered economy in Ethiopia. There is no economic democracy in Ethiopia that offers equal opportunity for all citizens. There is economic dictatorship in Ethiopia, with the key sectors of the economy controlled by politically-affiliated entities (conglomerates) like EFFORT. There is no process of democratizing ownership of the economy since the TPLF leaders are obsessed with controlling the economy as much as they are obsessed in controlling the political leadership. Even worse, the two largest regions, Oromia and Amhara, are under direct control of gun-toting gangsters, who harass, abduct, and kill people at their free will without any legal repercussions. There is no strong foundation for sustainable growth and development. I believe changing the underlying ownership patterns of the economy is so important to unlock possibilities not just for a more equal distribution of wealth, but for the kinds of decentralized planning needed to rebuild equal economic opportunity as sources of jobs and other benefits in the Oromia region and beyond. Large-scale alternative people-centered visions can be a powerful organizing tool.
Building national networks to channel financial resources into the people-centered economy, creating diversified opportunities in which both institutions and individuals can invest lay a solid economic foundation. Equal economic opportunities need to exist in every aspect of anchor institutional operations to increase local economic activity. It’s the responsibility of institutions to use their resources to address economic inequality by creating decentralized planning system in the process and creating opportunities for ownership. There is a need to shift institutions into patterns that support and stabilize thriving local economies. It’s important to remember that people must defend their right to do so politically. It goes without saying that politically marginalized people are people who are also economically marginalized.
Participatory Governance and Economic Freedom
There are multiple political and legal roadblocks to foster people-centered economy in Oromia to democratically manage its own energy sources. The current political system in Ethiopia is not ready to build a revolutionary change in the economy. There is a need of shifting the political culture away from spectacles of domination towards real engagement with the project of self-government driven by the mass. It’s the direct community control over the allocation of resources, which provides a tangible environment in which the muscles of community in self-government can be strengthened and scaled up to lay foundation for an economic revolution. And it’s only through such organizing and development that Oromia can build toward higher-order processes of truly participatory planning for people-centered economic progress and mass empowerment and mobilization for an economic revolution.
The key role local self-government can play in developing long-term community leadership by prioritizing the democratic control of the economic, political, cultural, etc. fate of the people. There are plenty of opportunities for creative grassroots organizing to expand participatory economy. Building democratic ownership at the community level opens up the possibility for people-centered economic planning with restored practical abilities of the mass.
The shifts in economic structure lead to changes in incentive structures, institutional requirements, and the relative positions of different groups in the economy. The management of these fundamental changes requires legal and institutional innovations, in which the state and other institutions play key roles for an economic transformation. Institutional reforms guarantee a “credible commitment” to economic transformation. A property right is a necessary prerequisite for a sustained economic growth. All these assets are missing in Oromia (Ethiopia at large) due to oligarch economic domination.
Corruption, Nepotism and Rent-seeking: Revolutionary Change
Corruption is rampant in Ethiopia at various levels and it operates as a negative factor in the economic growth process. Until and unless Ethiopia root-out corruption in the administrative system, it is most natural that the powerful economic classes will continue to exploit national resources in their personal interests. The mass has become powerless in shaping the economy.
The regulatory system is often misused and the licenses are not always granted on business merits of individuals. The art of tax evasion has been perfected under the TPLF/EPRDF regime by political elites of the regime and their associates and often taxes are evaded with the connivance of the government officials who get kickbacks. There is a streamlined supply and demand for it.
Economic transformation that creates people-centered economy calls for totally transforming the politicians’ role in the economy. OPDO leaders and cadres don’t have the leverage to change the key fundamentals that create level playing fields in the economy of Oromia (Ethiopia at large).
There is political and economic dictatorship in Ethiopia. Declaration of economic revolution without changing the fundamentals is merely an unrealistic empty rhetoric and diversionary tactic. Genuine economic revolution can only come via addressing the mass demand in a generic (wholesome) form. The mass movement in Oromia has put it in crystal clear terms. The solid foundation of the economy lies with upholding the mass demand. The mass demand is the genuine and people-centered empowering foundation for a revolution, including an economic revolution.
It’s not creating some share-holding companies that create an “economic revolution” in Oromia (Ethiopia). It’s empowering the mass, mobilizing the mass, and changing the interactions between people and the government, which lay a foundation for an economic revolution that benefits the mass.
More importantly, people under the state of emergency (direct military control and occupation) cannot build confidence and see any legitimacy in the regime as a genuine promoter of an economic revolution. Even dictators strive to build legitimacy and credibility in certain areas of interactions with the people they dominate and dictate. The TPLF/EPRDF regime has lost legitimacy and credibility in all affairs of governing, including in the regime’s economic interactions with the people, which is one of the major sources of grievances against the regime. OPDO cannot cherry-pick demands of the people to prolong economic and dictatorship in Ethiopia under the TPLF/EPRDF regime.
Economic revolution, as any revolution, requires prerequisite of subjective and objective conditions. Both preconditions are missing in Ethiopia, mainly due to the actions of autocratic and draconian rules of the TPLF/EPRDF regime. The economic policy of the regime is designed to control and dominate the people. It’s not designed to usher benefits to the larger public. There is universal dictatorship in Ethiopia, including an economic dictatorship (domination).
Moreover, true economic revolution cannot come via mere political declarations and naïve cadres’ unrelenting propaganda. It comes via revolutionary actions that prepare the fertile ground for the revolutionary plan to take root.
A revolution, including an economic revolution, requires mass empowerment and mass mobilization. But OPDO has been part of the TPLF/EPRDF regime, which has a sole goal of weakening and disempowering Oromos. The OPDO as an organization has been working hard to demobilize and disperse any Oromo independent mass organization & mobilization. OPDO as entity is organized as an antithesis to fostering any Oromo empowerment for a revolution, and OPDO has been programmed to disempowering Oromos for over 25 years. In short, OPDO as a political entity is organized in such a way that it cannot conduct any Oromo empowering revolution, including an economic revolution.
Oromia is under the state of emergency direct military control and the role of the OPDO and its direct interaction with Oromos, let alone mass empowerment for an economic revolution, has entered its weakest point since TPLF/EPRDF regime came to power. It’s also important to note that the fundamentals of the state of emergency are completely the opposite of the fundamentals required for a mass-based and mass-driven economic revolution. The state of emergency is designed to demobilize and disempowering the mass. And disempowered and demobilized mass cannot conduct an economic revolution for mutual benefits.
In short, the propaganda about the economic revolution is merely diversionary tactic of the usual catch phrases of the regime like “revolutionary democracy; developmental state, etc.”, whereas the realities on the ground dictate the emptiness of the unrealistic rhetoric. “Reality bites and doesn’t let go.”
The remaining issue is contemplating whether OPDO leaders and cadres are indirectly acknowledging the utter failures of the TPLF/EPRDF regime’s economy to serve the Oromo people by calling for an “economic revolution”.