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The New Postcolonial Economics with Fadhel Kaboub
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Scott Ferguson: Can you talk about some of the dangers and potential inflationary pressures? I know in your own work, you stress a strong political movement, but also sometimes a very careful and strategic economic development approach.
Fadhel Kaboub: Yeah, the strategic economic development approach to reclaim monetary sovereignty is renewable energy production because it's another major component of external debt. Also, sustainable food policy because of the food imports problem that many developing countries have. And then the third one, which is more difficult of a strategy—it takes a long time—is investment in education, vocational training, and technical skills. Because, if you want to industrialize and over time move up the ladder, so to speak, in the value added content, the only way you're gonna attract manufacturing that produces higher value added content is if you have the infrastructure, in terms of electricity, telecommunication, and transportation, but also the highly qualified labor that's required to be plugged into the production of high value added content.
That takes time. That takes a couple of generations to move up the ladder. So those are the three strategies that I always emphasize. And the question is, "Can we make the transition overnight or in a decade?" To me, the answer is it's not gonna happen overnight or in a couple of years. But you have to at least start thinking about that direction, planning for that direction, and then shifting resources away from your old strategy into your new strategy. Because the current strategy, for example, is to subsidize food imports and to subsidize energy imports. You're importing fossil fuels at globally determined prices, which can be inflated for your local consumers. And if you don't subsidize them, you're going to have fuel riots. If you don't subsidize imported food, you're going to have food riots.
So governments typically subsidize and offer food and fuel and transportation at affordable prices locally. The idea here is to shift some of the subsidies away from subsidizing fossil fuel and imported food into building more productive capacity of renewable energy production and sustainable food production. And over time, accelerate that shift and accelerate the development of those resources because that's the ultimate way of reclaiming energy sovereignty and food sovereignty, and as a result, monetary sovereignty.
Scott Ferguson: And as a result, political sovereignty.
Fadhel Kaboub: Absolutely. Because you become less financially dependent on the outside world. And as a result, you're more politically independent. And, to be honest, that's been recognized from the beginning by former colonizers as a threat. It was clear that having this neocolonial way of controlling former colonies through the financial aspect is way more effective than having troops on the ground controlling the economy and policing the population. Because it gives you the illusion of political independence. You have your flag and you have your football team. You have your territory and your military. And we'll even give you aid to help you reinforce your territorial sovereignty and police your population and everything. So it feels like we have independence. But when it comes to economic reality, you're not independent. And, as a result, politically you're constantly under manipulation by the lenders and typically countries who were the former colonizers.
Fadhel Kaboub is associate professor of economics at Denison University and President of the Global Institute for Sustainable Prosperity.
