How Laws Encourage Or Restrict Economic Development

All over the world countries are reforming the ways they do things in order to encourage development. They have no interest in remaining stagnant economically. They have watched the West and seen what progress looks like and how stagnation occurs. A major area of reformation, as it turns out, has to do with government regulations. Do they incentivize growth or strangle it. Does the culture fertilize the spirit of entrepreneurship or kill it with toxic chemicals.

Historian Niall Ferguson discusses this in his book The Great Degeneration: How Institutions Decay and Economies Die.

Ferguson studied the volumes of data gathered by the World Bank to evaluate the nations in Africa that he might identify which countries in Africa ranked highest by the following measures:

1. The Quality of Public Administration
2. The Business Regulatory Environment
3. Property Rights and Rule Based Governments
4. Public Sector Management and Institutions
5. Transparency, Accountability and Corruption in the Public Sector

The top countries that rank highest in four or more of these categories were Burkina Faso, Ghana, Malawi and Rwanda.

According to Ferguson, another way of evaluating is to look at the IFC's "Doing Business" reports since 2006. Which countries have done the best at reducing the number of days it takes to complete the following six procedures:

1. Starting a Business
2. Getting a Construction Permit
3. Registering a Property
4. Paying Taxes
5. Importing Goods
6. Enforcing Contracts

The African winners, in order of achievement, were Nigeria, Gambia, Mauritius, Botswana and Burundi.

Paul Collier, a development economist, outlines several stages to making commerce happen. Foremost is the necessary step of reducing violence. Second, protect property rights. Third, impose institutional checks on government. Fourth, prevent corruption in the public sector.

When I look at this list, my first thought is how cities that don't deal with inner city violence are essentially undercutting their hope for a better economic future. As for property rights, to the degree that cities can utilize easy "eminent domain" to eliminate businesses, to that degree they are sending signals to other businesses to consider a flight to safety.

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There was a time when the United States set the benchmark as regards the Rule of Law. Now, Ferguson states, it's the lawyers who rule. This is not the same thing. It's worth noting that lawyers are over-represented in our U.S. Congress. You might even say we have a nationwide epidemic of lawyers.

Cronyism and corruption are excessive as well. There is so much that is rotten in the legislature and regulatory agencies and the legal system itself, how can they be reformed?

Ferguson's answer to this is that real reform must come from outside the public institutions, from the associations of civil society. In short, from us, the citizens. 

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I remember reading a story years ago about an albacore fish business that was started in Los Angeles (or the vicinity). In order to just get the business off the ground they had to get approvals and paperwork from 49 government entities. Once they had gotten going, yet another agency read about what they were doing and because they did not have this agency's stamp of approval had to pay a $25,000 fine. 

WE GET WHAT WE INCENTIVIZE.
Here in Duluth we have a shortage of affordable housing. One potential fix here might be to do a thorough self-analysis of every facet of local government that has to do with housing. How many rules and regulations are interfering with the ability of the city to provide affordable housing? How necessary are they? Can they all be listed and prioritized?  Who has the authority to address each one (or each of the most restrictive items. 

We always think more money is what we need. What things can be changed without needing money? 

The book has generated a lot of ideas. Rather than blaming or finding fault, we can work together and discover solutions. Let's not give up hope.

At the Intersection of Time and Chance: Eight Minutes with Karen James Cody

Two weeks ago I had my first Air BnB experience. I'd planned a trip to visit my daughter and her husband inside the Washington D.C. Beltway, but needed a place to stay due to my lifelong cat allergy. Several options within walking distance invited me, but my instincts suggested this one in Takoma Park hosted by Karen James Cody.

Upon entering the home the artwork on the walls spoke to me, making me feel so very much at home. In the evening I likewise found Ms. Cody's story resonated with me as well, a networker in the arts community after a professional career in public relations. As she told me about the various projects she is involved with I wanted to share her world with readers here.

EN: What is The Allyson Group? How was it formed and what is its mission?

Gbenga Adibi, batik printmaker (Nigeria)

Karen James Cody: The Allyson Group is primarily me - Karen James Cody - offering writing, editing, and PR services to small-to-medium sized businesses, individual authors, and occasionally publications. Where additional skills are needed - for example, graphic design, photography, self-publishing consulting - I have a coterie of independent communicators who are available to jump in. I am also an artist's representative to a small group of visual artists. Here, I work to get them exhibitions, trunk shows, and to form relationships with museums and collectors.

EN: How was it formed? How has it evolved?

KJC: The company was first formed as The Allyson Company in the late 1980s in Oakland California, after I was laid off from my technical editing job with an environmental consulting company and did not have a Plan B. From that day to this, though I worked in corporate America for another 25 years, I have always had an independent practice.

Most of my professional life was spent in, first, graphic design and later, for many years, on the communications side of a large media company. As my skills and experience grew, I added to my own little company's offerings. In the beginning it was more like "word processing," putting together company brochures, annual reports, and the like: print "collateral." The personal computer added publishing capabilities to every writer's wheelhouse. We still needed designers, but not typesetters nor, necessarily, printers. (Sad, but true.)

EN: Your Kupendiza project is quite fascinating. I've read that you were the founder, but this didn't happen overnight. How did this project come together and get off the ground?

KJC: I do love beautiful handbags. It's not a fetish, but I love handbag design in the way some women love shoes. What got me into the business of handbags was the discovery that the beautiful beaded bags created by the Kenyan women I'm partnering with were funding an orphanage for HIV/AIDS-affected children in their community. It's why they founded their business.

I was enrolled by that because I have seen for myself that when women in small communities come together to take on some social challenge, miracles often happen.

My second partners were introduced to me by a friend, once he saw the purses from the original group. These women's project funds the manufacture of affordable feminine hygiene products for Kenyan girls, too many of whom can't afford the disposable kind, which forces them to miss school when they are menstruating. A totally solvable problem, and these women came together to solve it. Their work is also truly gorgeous. I added them to the roster, and suddenly I had a company. Kupendiza.

Since then we've added a group in Nigeria, and another in Tanzania. This year I expect to add the Amerindian community in Guyana, South America. And of course I'd love to identify women's projects right here in the good ol' U.S.A. that might be a fit for the Kupendiza brand: hand made by women.

EN: What are the special problems women in Africa deal with that you are attempting to address?

KJC: Besides the specific problems our partners are addressing with their businesses, women in many places are still second-class citizens (we think we're over that here in America, but the pay gap - among other things - demonstrates that's not true). The lack of gender parity is a challenge, and is manifest in business problems like lack of access to credit and financing - and in social problems like few choices about how to life one's life, the inability to live independently, even to claim title to land, lack of access to education in places where education has to be paid for out of pocket.

EN: The handbags are utterly beautiful. I found the craftsmanship stunning. Where are they being sold?

KJC: Now starting our second year, we are selling mostly at festivals, fairs, and aritsan markets along the Eastern seaboard, from Washington, D.C. to New York. We will branch out a little in 2017 - we've been accepted to the Neptune Festival in Virginia Beach in September, and Dance Africa at the Brooklyn Academy of Music in New York - big, prestigious festivals that I expect will give us more visibility. I'd love to make it to the eWomen Network conference in Dallas in August. We did well at the African Studies Association national convention in D.C. last December. So it's been mostly direct-to-consumer sales in our first year. We do have a shoppable website: Kupendiza.com, and are working to get known online, using social media: Facebook, Instagram.

www.Kupendiza.com 

www.Facebook.com/kupendiza

www.Instagram.com/kupendiza

EN: How did you personally come to connect with the needs of women in Kenya? Is there a backstory?

Gbenga Adibi

KJC: I met Pauline Muchina, co-founder of the African Women & Youth Initiative collective right here in the D.C. area. Professionally she is an HIV/AIDS policy worker and speaker. Her sister started AWYI. I was a customer first, and later decided to help them market the product. The business has branched out to add more partners.

Women working to solve our own problems is what inspires me. It's what I used to generally whip out my wallet and write a check to support. I saw starting Kupendiza as another way to support women's efforts to shape our own circumstances -- and our societies. The Kenyan beaders are highly talented. All they need are markets. The internet gives us the ability to easily and cheaply connect and collaborate.

EN: What is the Future African Leaders Project and why is this important?

KJC: The Future African Leaders Project is the orphanage in Nakuru, Kenya started by AWYI. They are housing, feeding, educating, and providing healthcare and other essential services to the kids. The first college graduates from this group were minted in 2015.

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Be sure to explore Kupendiza and its links. Thank you, Karen, for sharing.

Meantime, as your life goes on... make it count.