top of page

Solutions against neo-liberalism

In commemoration of worker’s day, I wrote an article celebrating the importance and power of protesting, specifically for workers in their hopes of gaining some control over their lives. I received positive accolades, but as a thinker, my inclination is always to decipher the critiques more intensely and they were a number! The critiques primarily revolved around the idea of providing practical initiatives that can be done to counter neo-liberalism within Zimbabwe and on a global scale. Rather than simply being against neo-liberalism, I am writing in the spirit of advocating for equality, ubuntu and democracy, in one word; socialism. This article is an introductory attempt to deal with this issue. My hope is to raise questions from the reader about how we live and more importantly imagine a different life; one which I think is possible. For the more academic who worry about plagiarism, I will profess that this article stands on the shoulders of the writings of Julius Nyerere, Guy Standing, Eric Knight and from my own personal experiences and historical culture of Africa tribes.

In March 2017, I found myself unemployed because of my political beliefs which were not to the tastes of my former boss. From being poorly paid by any measure, I was now unemployed. As Michael Denning says, “under capitalism, the only thing worse than being exploited, is not being exploited.” That lack of exploitation, ie, lack of a job leads many to depression, lose of self dignity and brutal self-degradation.

To skirt around those symptoms, the activist in me went into over-drive and decided to work on things and the community around me. As a resident of Crowhill, a new-ish, middle to low income community on the fringes of Harare, development of any type from basic infrastructure like roads, schools or clinic are non-existent; which was great because that meant I could crack my head around providing solutions. My two years of exposure to this stark reality combined with reading around this topic has led me to believe in the options below as being the most tangible, viable, solutions that can lift masses out of poverty and into prosperity:

1. Community co-operatives.

2. Domestic Direct Investment.

3. Democratizing finance.

4. Knowledge.

5. Participatory budgets.

6. Unconditional Basic Income.

1. Community Co-operatives

Now this one is not new in any way but how we understand it especially in contemporary African culture needs to change. Pre-colonial/capitalist Africa had a very strong system of “nhimbe” (Shona tribe) which was the process of collectively working to plant, harvest etc. The idea was by working together we could get things done. As the insightful can tell, the nhimbe system was philosophically against capitalism which requires concentration of capital and privatization of the means of production. This is a big problem of liberal democracy as noted by Richard Wolff because democracy is advocated for everywhere but at work. There is no economic democracy. Capitalism breeds workplace dictators we euphemistically call our bosses.

We have grown believing that is the only way to organize work live and it is for all intents and purposes a lie. The nhimbe system and the modern day co-operative system is a counter to that argument as it argues that all who work can have an equal say in how the workplace functions. Spain and Italy have very prominent co-operatives that are industry leaders in their fields. One of my favorite examples is the Emilia Romagna in Italy. My neighbourhood in Crowhill for the past 3 years has been working diligently on creating a property owners association which runs and manages and develops community infrastructure. This is how the adored Borrowdale Brooke functions. It is therefore not suprising that over a billion people work or belong to one form of co-operative or another around the world.

Zimbabwe is home to a number of co-operatives, some as famous as the Siyaso area. The community helps each other earn more and in a more democratic space rather than trying to do it by oneself. BUt for them to work, we need to stop viewing co-operatives as ‘poverty-alleviation’ schemes only but also tangible, functional systems of economic organization. Co-operatives urge solidarity, community and team work, which feeds into the intrinsic human spirit desire for belonging too. These are aspects of life we choose to ignore in our work lives but are very important. Crucially, the means of production are in the hands of those who make the product and provide the services

2. Domestic Direct Investment (DDI)

Linked to the notion of co-operatives, I would like us to ponder on the notion of Domestic Direct Investment. The past 30 years of Africa’s development, Foreign direct investment has been seen as the silver bullet to triggering development. However, because of things such as illicit financial flows, corruption, tax havens and investment mainly in the extractive industry, the benefits of FDI in the countries where they have been lucky to have it have not been tangible. They have actually exacerbated economic inequality as noted by Oxfam. The question is, what is the alternative?

I suggest Domestic Direct Investment (DDI) which is investment by locals in the process of creating economic production. Please note that DDI does not mean investment by local rich moguls only, but by co-operatives and some clever understanding of what capital is. Hernando De Soto in his book, The mystery of capital details how ‘capital’ can be created. For example, one of the main things that make low density houses more valuable is their guarantee of registration of the title deed. A house in Domboshava on the other hand is under valued because it has no title deed, making it as defined by De Soto “dead capital.” The Crowhill community is currently compiling land audit system which when done can see property values rise by 25-30%.

We can make those houses more valuable by providing title deeds to those houses (in a co-operative format) which will then increase prices and value of those houses. That simple act of governance creates capital that can be used to seek bank, business loans to stir economic activity. This is a form of domestic direct capital. The other important aspect of this is that because it is local, it is difficult for that capital to just leave as is the case with FDI. DDI because of its roots will not up and leave and it will respect the workers and community it works in more compared to FDI as we have evidenced with Chinese investment in Africa.

3. Democratizing finance

The process of democratizing the financial system is important and critical towards emancipating the poor. Capitalism has created the assumption that banks must be private entities. The irony pointed out by Eric Wright is that banks are public monies that are privatized by law. The 2008 global financial crisis and the Zimbabwe 2008 economic nightmare is a strong case for why the financial markets must be democratized.

This is what the micro-finance industry initially did. Grameen Bank (the first micro-finance) is wholly owned by the borrowers which has allowed it to keep lending rates low but more importantly, women get to speak and control their financial destinies which is empowering and liberating. Another example of this are the credit unions in western nations. The Stokvels in South Africa are a prime example of the power of community organizing in finance because they are now recognized by an Act of Parliament which also provides a depositors protection. This strengthens their power and reliability.

The examples I have provided are democratization of finance on the debt side. Finance can and should also be democratized on the equity asset side too. The financial industry has erroneously kept stock exchanges, mutual and hedge funds as the preserves of a small elite. This has meant that the majority of the population has not benefited from the financial revolution (derivatives etc) that has occurred over the last 30 years. How can the majority benefit from this?

Firstly, labour union investment companies should aggressively own listed companies. There has been varying success on this in South Africa and Sweden. The enormous proceeds that usually go to the financial elite can be transferred to the workers who are the true trustees of pension funds in the form of better pension, medical and funeral schemes. Moreover, laws that allow hedge funds to invest in riskier but higher returns must be opened to the middle class and lower class investors too. The main argument given by the financial industry is that the investments are too risky for the average investor. This elitist notion is confusing at best, condescending at worst because the economic life of lower classes is intrinsically risky in nature. This is due to the lack of insurance and corruption that pervades economic life. Additionally, people must be provided the right to invest as they deem fit. If one can vote for any party they desire, even spoil the ballot paper, the same option must be provided in their finances.

Some may ask does this mean banks and mutual funds must be nationalized? That is one option, yes, but I would like us to go further than the 20th century systems of distribution of wealth by nationalization. Nationalization is not synonymous with democratization. Democratization of banking for example would mean depositors have more say in how the bank is run, and can elect and fire the CEO directly. These types of banks already exist and they are called credit unions, very popular at the state and community level in USA. Key to this democratization of finance is not vilify finance as a preserve of capitalism, but to understand it as a service that when correctly used, cant serve communities.

4. Knowledge

An important cog in the 21st century socialist society has to do with education. Quality education over the last 50 years has become a preserve of a small elite. It has become more and more expensive blocking chances of upward social and economic mobility. Therefore, education must be a quality public resource as it is in Finland, Sweden etc. Key to this too are libraries which act as information portals that keep everyone aware of the latest information and knowledge available in any industry across the world.

Eric Knight gives an example of what Wikipedia has done in in terms of becoming the world’s encyclopedia. This is important too in the aspects of Domestic Direct Investment. Investment is not only limited to capital investment but includes the transfer of skills and knowledge. In the industrial revolution, this was very difficult. The internet and technology have allowed for the transfer of knowledge and skills to be significantly easier. This is why the intellectual property has become a hotly debated, and protected field in global trade. Any efforts that make intellectual knowledge more open is beneficial to all, especially in supporting DDI. The open-source movement that is home to applications such as Linux, blockchain (more on this) are instrumental in allowing for more equitable growth across communities. It is also my assumption that sharing of such knowledge across co-operatives will be easier too unlike in the current capitalist system.

5. Participatory budgets

The four previous anecdotes I have provided against neo-liberalism place significant emphasis on citizen participation. This is on purpose and it is for one main reason. 20th-century socialism failed on a number of aspects but its worst feature was the authoritarian brutality it came with. The belief in government/state being the preserve of the elected officials was wrong and allowed for the intensification of the brutality. Russia, China, North Korea, Cambodia are all examples of that. The government is not merely a representation of the people, the government is the citizens. What I am saying is that work needs to be done to replace representative democracy with direct democracy. One of the best ways of doing this is a participatory budget.

Participatory budgets are when citizens have a say in how budgets are spent, whether partially or completely. In practical terms, citizens on a regular basis vote for what they believe should be the priority in the budget. This has been done famously in Porto Alegre and Chicago city. IN my home community of Crowhill, a skeletal application of participatory budgeting has seen citizens decide that road infrastructure is the key investment that needs to be made. This not only empowers citizens but acts as a buffer to representatives having dictatorial powers over society, and keeps them in check. Essentially, the people are keeping themselves and their vote in check.

This participation can be taken even deeper by the adoption of blockchain technology. Blockchain technology (brought to fame by Bitcoin) is a public ledger system that allows any participants access to information and live activity of a certain project. For example, imagine if everyone had up to date information on how the budget is being spent in their community/city budget. Blockchain makes this possible which invariably reduces corruption. Instead of the government being the big brother checking corruption, citizens are the custodians of transparency and accountability.

6. Unconditional Basic Income. (UBI)

The most famous example and solution against neoliberalism, specifically the devil of inequality is providing Unconditional Basic Income. UBI is a certain constituency (eg. citizens of a country) getting some form of cash with no strings attached. Imagine every Zimbabwean getting $10 per month from the government. It has been argued for across the political spectrum for different reasons. Socialists believe it will reduce inequality, the more capitalist see it as increasing aggregate demand for their products and services and also as a replacement to salaries and wages which are being taken by automation of society.

As someone from the left, I support UBI because of its impact on the poor of the poor. $10 a month is peanuts to most urban dwellers in Zimbabwe, but in the rural areas, that amount can be as much as 10-30% increase in their income per year. That money can be used to fund schooling or buy sanitary pads. Tests have been done in Namibia, Finland, Malawi, India, Canada in regards to its feasibility. South Africa has it as a policy option and Switzerland voted for it. The richer the country, the more feasible it is but even in the poor nations, political will and ideological barriers will be the difference as to whether they happen or not.

In conclusion, the solutions towards fighting neo-liberalism and pursuing ‘new 21st century socialism’ of equality, ubuntu and democracy are by no means exhaustive or detailed. I have written on those I understand and believe are the most practical and possibly the most impactful in the current world conditions. I do believe that besides opposition from entrenched capitalist interests, barriers to their success will also revolve around the strong culture of individualism that now permeates society. Individualism in itself is not a problem, it is the assumption in our economic and political lives that ‘man/woman is an island’ that I believe will be a great challenge and calls for strong agents for the change I call for here. All that said, the society I am advocating for is not idealistic. They are all happening around us but we are blind, mute and plainly stubborn towards them. It is my hope that we will transcend them from being in pockets of life to being the mainstream. We have nothing to lose but our chains.

4 views0 comments


bottom of page