Niall Ferguson, Jewish World Review, March 6, 2007
Ever been had? Last year, the United States Agency for International Development gave Ghana $22.5 million in food aid.
Last Monday, that same country began a 12-month celebration of its independence from British rule, which was granted 50 years ago, on March 5, 1957. The total budget for these festivities, which commenced with an all-night party in Accra, is said to be $20 million.
You might reasonably ask if this is a sensible way of spending $20 million at a time when the typical citizen of Ghana has a daily income of $1.33. You might also ask what exactly Ghana has to celebrate after 50 years of “freedom.”
Let us not pretend that Gold Coast, as the country was known before independence, was a flourishing economy. The average Briton was 39 times richer than the colony’s average inhabitant. But Gold Coast was seen as one of the most advanced of Britain’s African possessions, which was one reason it was the first to be granted independence.
Yet the economic consequences of independence gave the lie to the old leftist claim that Britain was exploiting its colonies. Between 1960 and today, the gap between Britain and Ghana has more than doubled, so that the average Briton is now 92 times richer than the average Ghanaian. Today, according to the World Bank, aid accounts for 16% of Ghana’s national income and covers fully 73% of government expenditures.
So what went wrong? The answer is more or less the same answer you would give for any sub-Saharan African country since 1957. Kwame Nkrumah, who led Ghana to independence, was in many ways typical of the first generation of post-colonial African leaders. The product of a Catholic mission school and an American university, (Nkrumah was wholly incapable of distinguishing the virtues from the vices of British rule.
Though it was tight-fisted when it came to education and healthcare, the Colonial Office at least provided the foundations for economic and political stability: trade, balanced budgets, sound money, the rule of law and non-corrupt administration. Nkrumah lost little time in ditching all of these things. If you look at the photographs of the handover of power in 1957, the Duchess of Kent looks pained; the governor, Sir Charles Arden-Clarke, looks skeptical. Those facial expressions proved eminently justified.
As soon as he had been brought into government, Nkrumah increased government expenditures by a factor of 10 and expanded the senior civil service by a factor of five. It was a classic case of jobs for the boys, as members of Nkrumah’s Convention People’s Party hit the political equivalent of the jackpot. “The government is in the hands of knaves,” lamented one outgoing British official. Too late. Ghana provided the first of many examples of African democracy in action: One man, one vote—once.
The government was also in the hands of dupes. A long-standing Communist Party member, Nkrumah was easily persuaded by the KGB that the CIA was plotting against him and readily acceded to Soviet offers of assistance. This took the form of a KGB-trained national security service with a huge network of paid informers and more than 1,000 Russian “advisors.” By the early 1960s, Ghanaian women were staging protests with placards reading “Bring Back the British.”
Instead, it was left to the Ghanaian army to overthrow Nkrumah in 1966 (while he was visiting Ho Chi Minh in Hanoi). Far from improving matters, this proved to be the first of umpteen coups, culminating in the bloody seizure of power by Flight Lt. Jerry Rawlings in 1981. Although Rawlings formally restored democracy in 1992, he remained in power until 2001, and his party, the National Democratic Congress, continues to govern the country.
Today, there are still people who fondly believe that all of Africa’s problems are a legacy of colonialism—the fault of the wicked British. Those people also cling to the notion that this legacy can be expunged only by the payment of reparations in the name of “aid.” Fifty years on, we can surely think more clearly.
In virtually every case (Botswana is the sole exception), former British colonies in sub-Saharan Africa have fared worse under independence than they did under British rule. In virtually every case, as New York University’s William Easterly has pointed out, the expenditure of billions in Western aid has failed to raise their rate of economic growth.
In his forthcoming book, “The Bottom Billion,” Oxford economist Paul Collier brilliantly anatomizes the true causes of Africa’s post-colonial failure. He identifies four traps into which a depressingly large number of sub-Saharan countries have fallen since the 1950s. Some are trapped by their dependence on natural resources, such as diamonds or oil; some by being landlocked; some by recurrent civil war. But the fourth trap is the one that applies to Ghana: the trap of bad governance.
To illustrate the folly of giving aid to chronically misruled countries, Collier cites a recent survey that tracked money released by Chad’s Ministry of Finance to fund rural health clinics. Just 1% reached its intended destination. The rest was raked off by one corrupt official after another.
So forgive me if I don’t join Ghanaians in partying all year. I really don’t see much to celebrate if independence is just a euphemism for aid-dependence.