Kenya; The Land of 10 millionaires and 10 million beggars

 

                                            Photo credit: Atlantic Fellows for social and economic equity
“We do not want a Kenya of ten millionaires and ten million beggars. Our people who died in the forests with a handful of soil in their right hands, believing they had fallen in a noble struggle to regain our land… But we are being carried away by selfishness and greed. Unless something is done now, the land question will be answered by bloodshed.” These were the words the populist, erstwhile MP for Nyandarua and assistant minister for tourism and wildlife, JM Kariuki, uttered while speaking at a political gathering in 1974. Shortly after, 700 acres of wheat on a farm in Rongai belonging to the founding father of the nation, Mzee Jomo Kenyatta, were razed down by fire in an arson attack and several herds of cattle heinously slaughtered. About a year later, on 2 March 1975, JM’s body was found in Ngong forest by a herd boy; his hands had been chopped off, his eyes gorged out, his face burnt with acid and left on an ant hill. Knowing JM too well, it was easy then to dismiss his statement as mere populism. However, his remarks seemed to have aged pretty well.

                                                File photo of JM Kariuki

A recent Oxfam report revealed that the top four richest individuals in Kenya are richer than 22 million other Kenyans put together. Moreover, the findings by Oxfam showed that the richest 130 individuals own wealth equivalent to 19 per cent of the value of our GDP presently. Oxfam estimates that if Kenya’s inequality levels were to remain at the present level for the next five years, 2.9 million more Kenyans would be living in extreme poverty.

Some of the reasons explaining the extreme inequality levels witnessed in Kenya today stretch as far back as Kenya’s nascent days as a newly independent post-colonial state when a cabal of avaricious new African elite resolutely set out to enrich themselves at the expense of their fellow countrymen and set their progeny on the same perilous trajectory.  In recent times, the situation can be blamed on endemic systemic corruption, skewed distribution of resources as well as inequitable taxation that has seen rich Kenyans enjoy tax breaks and tax incentives while poor Kenyans bear the brunt through income tax and taxes on basic commodities.

 One of the problems associated with high wealth inequality levels in a country is political dysfunction. This is especially dangerous for a country like Kenya where wealth is synonymous with political influence. The wealthy elite are known to influence politics either directly by taking up political positions or indirectly by funding political campaigns. Most often, this is done with the ulterior motive to consecrate and protect their economic influence leaving the majority less wealthy worse off. The second major problem associated with persistently increasing wealth inequality levels is that it impedes economic growth. In the long run, if those at the bottom of the economic pyramid, who are the majority, are not helped to improve their own lot, pervasive depressed demand levels will be witnessed leaving even the wealthy who control businesses worse off as their goods and services will not be moving as they should.

For a largely capitalist society like Kenya’s, economic and wealth inequality is inevitable. However the inequality gap can be reduced. One of the ways to reduce inequality levels in a country like ours is by investing more in education. More funds should be directed at building capacity and facilities in schools in marginalized areas of the country. Moreover, bursaries and scholarships should be properly targeted to ensure that those direly in need benefit. Secondly, government financing options for Medium and small sized enterprises (MSME’s) that employ a huge majority of Kenyans should be up scaled so as to ensure enterprises have inhibited access to funding requisite for bolstering growth and expansion thus creating jobs and incomes which contribute in poverty alleviation. The Hustler fund has set the ball rolling and if properly managed it could be a game changer in improving the lot of those at the bottom of the economic pyramid. Thirdly, to reduce wealth inequality levels, the tax system should be streamlined to ensure that the super rich pay their fair share of taxes.