What drives economic success?

By Andrew M. Mwenda

Development is more a result of the activities of many anonymous individuals than a product of a visionary leader

Common sense should predict and human nature would dictate that every leader of a poor country would desire to go down in history as a great transformative hero; a Lee Kuan Yew or Park Chung Hee, the president and prime minister who presided over the transformation of Singapore and South Korea respectively. Even an Idi Amin, Mobutu Sese Seko, Jean Badel Bokasa and Siad Barre, perhaps the most venal leaders Africa has produced, would prefer such a legacy.

Why then do some leaders perform wonderfully and others woefully? Is it something in their personality or is it in the circumstances of their societies. I believe it is the interaction of both; but would hasten to add that their individual character traits contribute a very small part. I could even arbitrarily place their contribution at five to 10 percent.

However well-intentioned, honest, dedicated and visionary a leader of a country may be (I have in mind here Julius Nyerere, Kwame Nkrumah, Gamal Abdel Nasser, Kenneth Kaunda, Milton Obote, Samora Machel, Thomas Sankara, Paul Kagame, Meles Zenawi and Yoweri Museveni), there are limits to what they can achieve.

My friend Hashim Wasswa Mulangwa believes that “seek ye first a good leader and the rest will be added unto you.” To him, every society at any given time has capacity to transform as rapidly as South Korea, Taiwan and Singapore. A country’s fortunes, he believes, depend on the character, motivation and personal competence of the individual president. This is the great-man-of-history or “heroic-leader” hypothesis popularised by 19th Century Scottish philosopher Thomas Carlyle.

I have over the years grown suspicious of this hypothesis. I still believe leaders play an important role in the destiny of nations by organising people, articulating a vision, promoting public policies, building political institutions and directing state strategies to particular ends.

However, as Karl Marx wrote in The Eighteenth Brumaire of Louis Bonaparte   while commenting on the coup d’état by Louis Napoleon in France, “Men make their own history but they do not make it just as they please; they do not make it under circumstances chosen by themselves but under circumstances directly found, given and transmitted from the past.” Here Marx was writing about structural constraints on political action.

The heroic leader hypothesis is actually a narrower version of the state-centric view of development i.e. that what happens in the state and its politics has the decisive impact on the fortunes of nations. Anyone looking at North and South Korea would agree with this argument.

Yet I am more inclined to believe (while recognising such exceptions and divergences), that a society-centric view of development provides better insight; that development is a product of the activities by myriad anonymous individuals operating in society and the market. States and leaders play a secondary catalytic function. If the objective conditions in society are right, leadership galvanises them.

States and societies are mutually constitutive; with state action being facilitated or constrained by the inherent capabilities in the society. Looking at Africa in 1960, it is improbable that any president could have produced the kind of rapid industrial growth that happened in South Korea or Taiwan, however visionary, strategic, nationalistic, honest and hardworking they might have been.

The differences in developmental outcomes between South Korea and Ghana were because Park inherited a state and society much more advanced in skills, technology, literacy and administrative capacities than Kwame Nkrumah.

Indeed, transformative leaders can only be seen in retrospect. While he was president, few saw Park in South Korea as great. He was beset by continuous student protests and workers’ strikes throughout his presidency. So strong was resistance to his rule that in 1972 he suspended the constitution and declared martial law.

Many South Koreans considered his regime brutal, corrupt and incompetent. Indeed, he was assassinated by his chief of security while demanding that student protests be crashed even if it meant killing 30,000 of them.

Chiang Kai-Shek and the KMT presided over what is widely considered to have been a predatory state on Mainland China. After they were defeated by the communists under Mao Tse Tung and escaped to Taiwan, they presided over a developmental state. How could the predatory state of Mainland China become a developmental state on the island of Taiwan?

Many scholars believe that organising developmental action on the mainland was difficult: a deeply entrenched landed class was politically strong and hence difficult to overcome; a large, illiterate and conservative peasantry; limited technical skills relative to the size of the country etc. So a predatory leader in one circumstance can be developmental in another showing that personal motivations or even competences have less weight compared to structural imperatives.

Few observers would deny that President Paul Kagame of Rwanda has provided his country excellent leadership. He has exhibited extraordinary management ability, exceptional concern for the welfare of his citizens and built the quintessential developmental state.

But equally few would predict that by 2017 Rwanda would have become an industrial powerhouse like South Korea by 1979 when President Park was killed – with an incipient indigenous capitalist class owning companies like Daewoo, LG, Hundai and Samsung that were already manufacturing cars, electronics and building big ships.

Indeed the similarities between the two countries and presidents are striking.  Park became president via a coup in 1961, eight years after the end of a civil war in which 1.5 million people died and where 85% of GDP was destroyed.

Kagame became president in 2000, six years after a genocide in which 1 million Rwandans died and 60% of GDP was destroyed. By the time he was assassinated in 1979, Park had been president for 18 years. By 2017, Kagame will have been president for 17 years.

The answer to the divergent development outcomes in Rwanda and South Korea cannot simply be in the personalities and competences of Kagame and Park. Few contemporary leaders have demonstrated complete dedication to transforming their societies as Kagame has.

The differences lie in the initial conditions contained in each of these societies (e.g. urbanisation, level of skills and technology in society, literacy, size of the middle class, presence of a capitalist class, a sense of national unity and social attitudes) and physical and political geographies. This is a broader subject I will discuss another time.

amwenda@independent.co.ug