Economic Growth vs Democracy

Is there Casual Relationship Between Economic Growth and Democracy? Brief Analysis from Ethiopian Context

(Tamrat Dejene - Director at GCAO)

There is a wide range of polemics between and among social scientists on the casual and non casual relationship of development and democracy. From Classical political and economic thinkers to the contemporary protagonists of free enterprise, various theories developed to address the relationship equation but with no avail. Prominent scholars of development (John, G.J. BOND,  Brandt,P.T. and Moreno ,J, 2005:323 ) affirm;

The econometric evidence suggests, however, that these positives are balanced by negatives such that the net effect of democracy on growth performance cross-nationally over the last five decades is negative or null.

In spite of inconclusive extensive academical exercises, practical and historical records tell us democracy and economic growth are two separate tentacles of the same stalk where somehow economic development lead to democracy and serve as an engine to the other. However, large volumes of development literatures further justify that there is no apparent association between the two. Mesquita,B., Downs,G.(2010:77);

...The fact that almost all of the richest countries in the world are democratic was long taken as iron-clad evidence of this progression. Recent history, however, has complicated matters. As events now suggest, the link between economic development and what is generally called liberal democracy is actually quite weak and may even be getting weaker.

I argue that Ethiopia’s democratization process and accelerated development are two sides of the same coin but not identical twins. Both democracy and development have their own virtuous and exist objectively independently and have immense contributions in themselves for the fulfillment of human vital needs and aspirations.  Regarding this controversial issue of academics, Late Prime Minister Meles Zenawi, at World Economic Forum held in Addis Ababa on 11-12/2012 eloquently elaborated the asymmetrical relationship between economic growth and democracy (Accessed on 29 May 2015 https://www.youtube.com/watch?v=OwTPfsqwERY);

…in my view is there is no direct relationship between economic growth and development historically or theoretically. Democracy is a good thing in itself irrespective of its impact on economic growth.....in Africa most of the countries are extremely diverse, that may be the only possibility or the only option, of keeping of relationship between nations ...democracy may be the only viable option or keeping these diverse nations together...so we need to democratize but not to grow, but we need to democratize to survive....the case for democracy can stand and shine in itself.

The existing studies on the casual relationships of democracy and development are inconclusive. In fact, the practical historical experiences of today's mature democracies do not indicate any type of direct cause and effect relations between the two essential elements. However, it is an indispensible matter to briefly assess the genesis of development and democratic process of the most notable develop world whether there had actually been any type and degree of causal relationship between democracy and development or vice versa. Obviously, democracy (Western democracy) begins in the early city states of Greek many years back in BCs. The old city states of Greece used to exercise some of the basic democratic principles familiar to the contemporary ones. Most notably, voting nights were exercised partially. The aristocracy and members of the ruling class had the right to elect and to be elected. Citizens of Athens had the same voting rights as their rulers. On contrary, foreigners, slaves and women did not enjoy their political rights. Rather, they were relegated to the status of subject.

In middle ages, after the fall of Roman Empire, the emergence of Renaissance in Western Europe paved the way for the threatening the political legitimacy and the core foundations archaic feudal political status of quo. English landlords began to withhold their allegiance to the Crown unless some sort of power remained in the hands of local barons and knights. The contradiction led to the formulation and birth of modern parliamentary democracy.  The promulgation of the Magna Carta In 1215 is considered as the culmination of the struggle between the two rivalry ruling classes. The charter/ legal document officially recognized the reallocation of political power to the aristocrats. 

Though the struggle continued unabated between the dominant classes under different historical conditions, the change in the old ruling system of the King could be a step toward democratization process in Europe and elsewhere, The teachings of Niccole Machiavelli in his classical work, “the prince ", drew a dezi- deratta formula for the monarch of self governing Naples to further consolidate his power. He explicitly showed strong sympathy and commitment for iron-hand aristocratic government leaving aside the critical role of the mass / citizens from the mainstream political discourse to limbo.

The social contractarian theorists that emerged around the early period of the American revolution, Thomas Hobes, Jhon Locke, J.J. Rousseau, Montesquieu, Bentham and J.S.Mill , K.Marx etc came up with the idea of  building of a government servant to the people. In fact, the state theories pursued by these scholars differ from the degree of emphasis they put forward to the role of government.  Hobbes inclined to a strong omnipotent state (Leviathan) that rectify injustices and protect private property and committed to take serious measures on robbers, indolent, and burglars. Highly desperated by the civil war in England, he developed a sense of pessimism on democracy and popular rule and came to the conclusion that life without state is brutish, nasty and hopeless. 

On contrary, J. Locke came up with opposite political antithesis to Hobbes Leviathan assertions. He strongly argued that the government should work with the consent of its citizens. The rule of the government should be based on the contract. If the state failed to deliver what it opted/ promised to do under the truce, it should be removed from power with public vote- through election, not by force. After all, the core role of the state relegated to the optimum preservation of individual property rights and liberties. Consequently, a representative government that worked to and in favor of the propertied class came in to being. The large masses or the majority of non-propertied class considered as usurpers of power that jeopardize the core economic interests and values of the dominant class. This was the philosophical foundation for the liberal political values up until these days.

J.J Rousseau had different views from the above English political thinkers who had strong views of belittling the political participation as well as the full exercise of the rights and privileges of the large masses of the Society. Conversely, Rousseau from his own French history viewed the participation of the people as a core integral part of the political process of the country. He underlined that the state is legitimate so long as it satisfies the general will of the people at large not a few section or segment of the society. He made great emphasis for the consent of the general public. Consequently, he uplifted the role of the state beyond guardianship of the private property. His state view can be categorized as a middle ground position between the pro-authoritarian Hobbes to that of libertarian Locke. Rousseau's thought further developed by Marxian philosophers and served as a reference for socialism and welfare capitalism including developmental state paradigm.

The utilitarian schools, Bentham & J.S.Mill, emphasized the role of the state more than ‘night watchmen’ assignment. They argued that the state would rather perform vital socio economic activities that help to realization of the greatest happiness to the greatest number of the society. In its essence, their political views more akin to presenting the welfare of the society than individual liberty and property rights alone.

Hence, the American Revolution is highly influenced by the ideas of contractarian theorists, especially by the views of English political scholars. Value for personal liberty & personal achievement in the American society is embedded in the political teachings of especially J. Locke. The crux of the liberal ideology that promotes highest credit to the ultimate protection of property rights and liberty was by and large endorsed earlier by same schools. Interestingly, the role of the state in such political system designed to fit the interests of the propertied class that calls for "small government." A government that can be easily manipulated and so weak that merely granted the role of guardian of the haves'-class interests.

Now, the question follows, what got those the variant political foundations have to do with democracy and development?

The answer is not short and simple. So, in the first place, it appears essential to define the genesis of democratization and development from history of independent state scenarios. We have to go back to the roots of the cases and processes of development and democratization of states. We must dwell upon concrete historical evidences and scientific reasons before making judgments on the causal relationships of democracy and development and the political ramification of the system as we know it today.

The teachings of contractarians obtained wide acceptance in many parts of the Western Europe and especially in the USA. Democracy in its embedded definition of public will and public participation did not seen in its full-fledged growth of democratic system.   The holy bible golden rule strictly observable here as "one who has the gold rules, others follow the rules". Implying that those who have already accumulated resources and amassed property and money would automatically put on the driver seat while the large non-propertied class obey the rules. As a result, the rule of the game of politics and exercise of democratic rights were/are based on certain qualifications and preconditions. 

The reverse holds true. That is, those who allegedly do not own property or own money did /did not participate in the democratization process. Since voting is based on certain artificial qualifications, the general public particularly, the blacks, colored, white women were banned from participation in the political process. Consequently, the full universal suffrage for women realized in USA and England in late 1920_s. Blacks waited 200 years after American Revolution to be franchised and be able to exercise their civil and political liberties. The year 1960_s as the civil rights movement sparked across the nation, blacks began to enjoy their fundamental freedoms and rights. Switzerland, allow women to vote in 1971. The history of democratization of those nations implies that indeed democratization is a process rather than built  overnight. Still, civil and political rights are not fully met in most of ethnically and racially diversified democracies of the world. The struggle continues even today.

Despite laying down the legal frameworks for broadening democracy and protection of pertinent individual civil and political liberties, the value formation and organization of democratic institutions are indispensable for a full-fledged implementation of democratic system.

Development may not go hand in hand and parallel with the growth of democratic institutions, values, culture in a given state. Yet, development does not necessarily ensure democracy nor realize full enjoyment of human freedoms. The Nobel laureate Amratya Sen(  1999a  :42) comments;

The problem might have been of no great practical interest if the achievement of economic prosperity were tightly linked–in something like a one-to-one correspondence–with that of enriching the lives of the people. If that were the case, then the pursuit of economic prosperity as an end in itself, while wrong in principle, might have been, in effect, indistinguishable from pursuing it only as a means to the end of enriching human lives. But that tight relation does not obtain. Countries with high GNP per capita can nevertheless have astonishingly low achievements in the quality of life, with the bulk of the population being subject to premature mortality, escapable morbidity, overwhelming illiteracy and so on.

On the other hand, some argue that if citizens enjoy a better standard of living where in due course of time they will be able to develop a sense of exercising political freedom. The impulse for exercising freedom would bring a sense of extra demand of intangible assets and satisfaction thereof.  But, the creation and maturity of the demand may take long process of social change in attitude culminating in burgeoning political emancipation. For instance, industrial revolution began around 1780's and early 1880s which conditioned remarkable economic growth in England and USA. Growth in GDP and per capita income tripped and quadrupled impacting a radical change in the livelihoods of the society. In effect, free press, freedom of assembly were legally protected though huge observable irregularities across the developed world. 

Yet, nearly all media outlets like any other economic sector, out rightly fall under few capitalists. The immediate consequence of monopoly and the consolidation of all economic sectors under few oligarchs concurrently dominated the source of knowledge and information. This situation in turn directly jeopardizes the whole process of democratization process and virtual exercises of individual political and civil liberties. Hence, in case of mature democracies such as USA, UK or else, democratic processes, institutions and values may not simultaneously and equally exercised by all citizens. There are still week-links that needs special attention that emerge evolving improvement continually. 

It follows that democratization and developments are mutually exclusive and have no or little casual relationship as we observe from early democracies and developed states. It can be possible to become economically developed nation without democracy but not vice versa. The current dialogue chat revolves around the economic growth and democratization process should be seen from the above mentioned historical, economic and cultural complexities. 

 

Particularly, the contemporary complain that systematically undermine the economic growth and democratization process of Ethiopia should be understood from the above genesis. Most importantly, the peculiar socio-economic and political setting of the country and its consequential successful exploitation of the late -mover advantage in democracy and development.

As I tried to argue in the previous discussion that there is no conclusive evidence in research that confirm democracy and development are mutually inclusive. I also mentioned that during early days typical example of development without democracy in USA during its formative years and the newly industrialized nations of the South East Asian development miracles. However, from Ethiopian context, since it is a late comer democratic developing state, it has essentially embraced democracy equally with development. The peculiar socio-economic and democratic and historical factors necessitated the promotion and implementation of democratic system juxtaposed with developmental one.

In our context, democracy has no option. hundreds of thousands of Ethiopian youth, men and women payed dearly for the realization of a democratic system in the country. Universal suffrage, the rights of nations nationalities and peoples self determination up to succession, the night to assembly and free movement, the right to peaceful demonstration and strike, the freedom of press and access to public information etc are some of the fundamental democratic questions raised by Ethiopians through generations.

In the last two decades an attempt is made to incorporate those sine-qua-non democratic issues in to the formal legal framework of the state. The fundamental freedoms and rights made part and parcel of the constitution. All civic and political rights acknowledged in the national legal document too.

A federal system of government is set up to empower citizens through participatory grass- roots democracy. Social and cultural rights fully exercised by the nations, nationalities and peoples of Ethiopia. Regular election becomes a rule than exception and routine state practice. Opposition parties flourished to respond to national and partisan interests. Free press mushroomed in quantity and scale never witnessed before in the modern history of the nation.

Ethiopia embraced democracy to effectively respond to the age-old national question, equal access to political power as well as to cherish fundamental freedoms and rights. Parallel to this move, development is also a top national agenda to perpetuate the state existence before it passed to terminal stage. Poverty, backwardness and underlining of diversity and pluralism of ideas pushed the country in to the verge of total fiasco during 1990_s. This worst form of national scenario only be reversed through ensuring accelerated and high economic growth rate.

The fundamental policies and strategies of the government of Ethiopia unequivocally underline democracy and development as core national objectives of the state. The FDRE Constitution preamble states:

Strongly committed in full and free exercise of our right to self-determination, to building a political Community founded on the rule of law & Capable of ensuring a lasting peace, guaranteeing a democratic order, and advancing own economic and social development.

Another government policy document, Issues of  Democratic System Building in Ethiopia under sub-title " Democracy, Development and the survival of the state" elaborates the intertwined necessity of democracy and development for survival of Ethiopian state. The statement says;

due to the national contradictions that flared by the ant-democratic regime, the civil war  and famine loomed leaving the large part of citizens in to abject poverty, destination and backwardness (P.6)

Hence, from Ethiopian objective conditions, democratization and development issues are non-contradictory rather mutually inclusive. The question of democratization is most priority national objective of the state. There is hegemonic understanding and commitment that without embracing democracy, the survival of the state will undoubtedly put in to jeopardy. The existence of the state is not only conditioned by democratization, but also ensuring development of the society has equally given equal national priority. It is poverty and backwardness that took the lives of half a million and two million Ethiopians during the past two consecutive oppressive regimes. It’s not mere statistical exercise but the problem has lived with us for centuries.

Thus, it is possible to embrace and pursue democratic and developmental as the current scenario of Ethiopia clearly depicts. It’s neither fares nor a fable to realize both democracy and development at the same time. Without embracing democracy, state failure is inevitable so does ensuring development that cherishes every citizen out of the national fruits according to the contribution and effort made.

Finally, it is essential to underscore that history of the world does not provide us suffice examples of concurrent emergence of democracy and development. Scientific literatures conducted in the last 100 years do not reach conclusive findings either. However, Ethiopia, from late-mover advantage points of view on the one hand and from its own peculiar socio-economic and political circumstances on the other has embracing both.  There might be challenges to this assertion. Disagreement is natural on the performance rate and scale of implementation of democracy, development of both. How hot differences might be, yet, Ethiopia can sufficiently provide both menu and contribute a third option in the field of development and political science. The county has conducted five consecutive national elections with a record number of 38 million registered voters and 92 per cent turn out that never imagined in most of the word democracies in 2015. It has also undergoing through economic transformation evidenced by double-digit growth for a decade and beyond. Once again, Ethiopia is both by de jure and de facto is democratic and developmental. 

The dilemma that surfaced ongoing difficulties compounded by reliability problems in making association in lucid manner is well evidenced. So far, no substantial literature defines the causal relationship of economic growth and democracy. Yet, this dominant general truth that still continued to be a source of theoretical dilemma seems to be challenged by the current Ethiopian transition to democracy and the consequent achievement of sustainable economic growth. Thus, in Ethiopian context, democracy and development are mutually inclusive and complement each other.