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Establishing The United States Of Africa - An introduction on economic worldviews and human nature (I)

Today, we begin our report by considering the concept of worldviews and its bearing upon creating a perspective on human nature, which is central to all economic ideas and theories and the policies which grow out of them. One of our main objectives in doing so is to demonstrate that although economists maintain to the contrary, all of their theories, policy initiatives, and prognistications rest upon particular views of human nature. Again, this is the case whether economists admit such or not, and even, whether they are cognizant of such or not.

We offer support for this proposition from Islam And The Economic Challenge by M. Umer Chapra who builds a lucid case for recognizing the connection between economic systems and "worldviews":

To allocate resources efficiently and to distribute them equitably, every economic system must answer the three well-known fundamental economic questions of what, how, and for whom to produce: how much of which alternative goods and services shall be produced, who will produce them with what combination of resources and in what technological manner, and who will enjoy to what extent the goods and services produced. The answers to these questions determine not only the allocation of resources in an economy but also their distribution between the present (consumption) and the future (savings and investment). Allocation and distribution ultimately determine whether the needs of all individuals are fulfilled, whether all other socio-economic goals are realised, and whether there is sufficient motivation for a people to put in the best performance for their realisation. The crucial test for an economic system lies not in its professed goals but rather in their realisation.

All three questions, though apparently straightforward, are value-laden and cannot be answered in a vacuum. It is necessary to have a worldview or underlying philosophy (weltanschaunung) and strategy. Every society or system is dominated by its own worldview which is based on a set of implicit or explicit assumptions about the origin of the universe and the nature of human life. This worldview controls, in the words of Arthur Lovejoy, "the nature of man's reflections on almost any subject." Differences in views about human nature lead to differences in conclusions about the meaning and purpose of human life, the ultimate ownership and objective of the limited resources at the disposal of human beings, the relationship of human beings toward each other (their rights and responsibilities) and their environment, and the criteria for efficiency and equity. Such a worldview performs the same function for an economic system as the foundation does for a building: even though the supporting foundation is invariably invisible and unmentioned, it continues to play a determining role.

The system's strategy is a logical outcome of this worldview. To be complete and effective in enabling the system to realise its goals, the strategy must consist of a number of indispensable elements. It must have a filter mechanism through which all claims may be passed by either the 'invisible and visible' hand to maintain a balance between resources and the claims on them and to realise optimum efficiency and equity. It must provide a mechanism to motivate individuals to put in their best performance in their own interest of society. It must also have an effective way of bringing about socio-economic restructuring to enable a prompt transfer of resources from one use to another until the most efficient and equitable allocation and distribution have been attained.

Unless the worldview and the strategy of a system are in harmony with its professed goals the goals cannot be actualised. To grow a mango tree, you need a mango seed; a lemon seed, no matter how good, will not do. Systems which reflect an inherent inconsistency between their goals and their worldview and strategy are unable to bring about the fundamental adjustments in the life-styles and the structure and organisation of their economies. They are therefore crisis-prone. People living in such systems cannot be fulfilled, no matter how many and minor adjustments are made. Such minor adjustments do not penetrate to the root of the problem. They address merely the symptoms of the inconsistency but fail to achieve consistency between the worldview and strategy and the goals. The problems therefore reappear in a different form, more serious, and more aggravated each time.

For Chapra the problem boils down to the lack of symmetry in the worldview, strategy and goals of economic systems. He states that goals are never obtained because the means devised to accomplish them are inappropriate because the worldview that supports them is flawed. His diagnosis represents a confluence of forces and a dynamic process where flaws in a worldview directly result in flaws in strategy. At that stage it is almost irrelevant as to what the goals are - they almost invariably can't be reached. And if they are reached it is by pure accident or without the knowledge of how they were obtained.

Chapra's critical approach to economic models is what is needed as we look forward to an African Union. His effort to get at the root of the basis of the world's dominant economic regimes is an essential one. It is especially important due to the pressures that are and will continue to be placed upon African policy makers who will be assigned the task of forging the economic union. Before policies can be recommended in Africa, Chapra's approach warrants a thorough review as does the plethora of analyses pertaining to the worldviews that underpin every economic system. Chapra connects what others bifurcate. As a result his critique of the world's dominant economic philosophies and systems is stiffer than most. Again, Chapra approaches things by going after the root:

There have been several explanations of the universe and of the nature and meaning of human life. These explanations have led to different ways of life and different economic systems, each based explicitly or implicitly on its own worldview and each providing a different strategy for solving the economic problem. Three economic systems are dominant in the present-day world - capitalism, socialism, and their joint offspring, the secularist welfare state. Each of these has undergone significant revisions relative to the original version because of various problems faced over the years, and the changes introduced to solve them. The systems in their present form are thus far from what they were originally. Nevertheless, in spite of the various 'revisions' in the systems, the enormous wealth that these systems have created, and the relative abundance of their resources, these countries have failed in varying degrees to realise serious macroeconomic imbalances. Their problems have in fact increased continually. Social unrest and crime have also risen and they are in general facing a crisis situation.

Approaching the problem from another angle but possibly more succinctly, Nation of Islam Minister Jabril Muhammad in This Is The One writes, "One's understanding of a society can be no better than one's grasp of the nature of the people constituting that society."

How well have socialist and capitalist policymakers, for example, understood the societies that they were guiding? How well could they have guided societies, if they were not able to grasp the nature of the people constituting that society? Furthermore, how could African policy makers accomplish goals with economic strategies that were crafted out of a significantly flawed worldview with a view of man that is antithetical to the indigenous beliefs systems and theologies which Africans believe in and which provide insights into human nature. If the worldviews that guide capitalism and socialism are flawed and policymakers of both perspectives marginalize indigenous belief systems and religions that are popular in Africa, what realistic expectations are there that such economic models will achieve their noble-sounding goals, on the continent of over 700 million?

Note: All of the above is an excerpt from a 200-plus page special report, "Establishing The United States Of Africa - The Economic Foundations" published last year by The complete report will be made available later this year, with an additional volume added.

Tuesday, July 16, 2002

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