Ever since the storming of the Bastille on July 14, 1789 that marked the beginning of the French Revolution, food price inflation has been a powerful impetus to civil unrest
There are some truths that are very inconvenient; no one wants to hear them. They challenge assumptions we make about life, assumptions that are necessary in aiding us to sleep peacefully and go about our business with a sense of security.
One of such truths concerns the increasing cost of living in Kenya. The inconvenient truth about it is that there are perilous political consequences that are imminent from these inflationary trends.
According to the International Monetary Fund (IMF), each 10 per cent increase in global food prices doubles the likelihood of civil disorder, riots or worse by 100 per cent. In a report entitled Food Prices and Political Instability authored for the IMF by two economists, Rabah Arezki and Markus Brückner in March, the authors say that in low income countries, increases in international food prices will lead to a significant deterioration of democratic institutions and a significant increase in the incidence of anti-government demonstrations, riots and civil conflict.
Will be terrible
The report quotes the then IMF Managing Director Strauss-Kahn saying that “… the consequences of food price increases on the population in a large set of countries … will be terrible … disruptions may occur in the economic environment … so that at the end of the day most governments, having done well during the last five or 10 years, will see what they have done totally destroyed, and their legitimacy facing the population destroyed also.”
The two economists then came up with a food price index by which one could calculate the vulnerability of a country to social upheaval based on the increases in food prices.
Ever since the storming of the Bastille on July 14, 1789 that marked the beginning of the French Revolution, food price inflation has been one of the most powerful impetus to civil unrest. This phenomenon has become such a reality in recent times that the Western media now talk of the “inflation intifadah”.
Writing for Forbes magazine in February, Jerry Bowyer, a contributor, said that the revolution in Egypt in 1981 was more about food prices. “When food prices rise, so does fear -and the likelihood of revolution. Egypt, the nation that invented bread 40 centuries ago, began to starve. Bread riots rocked the nation. Food anxiety from the middle class and disapproval of the Egypt-Israel peace accords merged into an anti-Sadat fervour which led to regime change in 1981.”
Is someone fomenting crisis for political gain?
Some people see a political angle to the current crisis, that there are political forces fomenting an economic crisis in order to reap political benefits. If that were so, then it must be said that the reaction of the government would be seriously incompetent from a political perspective. Because if it thought that the crisis is politically instigated, then the problem would call for a political solution, none greater than initiating immediate measures to make food affordable.
These are the inconvenient truths that Kenya must start dealing with. Over the last three years or more, the price of food has been steadily rising and more than doubled. And just when it appeared that Kenyans had found their balance, the shilling lost 30 per cent of its value in a few weeks.
This means that invariably, the cost of fuel will go up by a similar margin. But while some of us are only worrying about the cost of fuel and how expensive it is getting to keep a vehicle on the road, the majority of Kenyans will be worrying about hunger and an inability to feed themselves as the price of food is likely to rise again.
World Bank President Robert Zoellick, while speaking in April to a meeting of finance ministers from around the world held in Washington, said: “While many are worrying about filling their gas tanks, many others around the world are struggling to fill their stomachs, and it is getting more and more difficult every day.” He called for urgent government intervention saying: “Governments should be able to come up with this assistance and come up with it now.”
In the Kenyan case, interventions that the government is implementing to deal with this situation do not appear adequate to meet these challenges. The government seems to be dealing with the food issue like an economic challenge, rather than a political crisis.
Apart from the initiative to have subsidised maize being sold to slum dwellers and other vulnerable groups, I do not recall any emergency intervention on the food crisis. In any event, the inflation rates have already outstripped this initiative by raising the price of food to what it was before the initiative.
It is shocking that wheat flour, which used to be so expensive that many families could only eat chapati during Easter and Christmas festivities, is now cheaper than maize flour. Ugali is now more expensive than chapati!
The official estimates for the time it will take to take back the shilling to where it was before the loss of value is six months. I doubt we have six months. I am not an economist but I am sure that in the repertoire of possible solutions there must exist one or two that can immediately stop this trend while other solutions are being worked on.
When President Obama took over the presidency in America, he initiated the financial bailouts to private companies in an attempt to shore up the economy. This initiative had its own failures but it must be appreciated for its courage and urgency in response.
Aren’t there any similarly direct emergency initiatives that can give some respite to the poorer Kenyans as we sort out our macro-economic issues? Can’t we, for some time, divert expenses from development to food and fuel subsidies in order to lower the cost of ugali nationwide? Surely, this situation cannot be without a solution.
Or maybe we are not initiating these solutions because our eyes are more on the macro-economic scenario than the political risks we are taking in implementing long term solutions than short-term ones.
I discussed this scenario with an economist and he said that some short-term solutions could panic the economy and affect sectors like the stock exchange. He also said that all the major economic indicators were stable and, therefore, all we needed to do was look for and address the factors bringing about the current crisis.
This may be so, but I view it as a dangerous approach. The only economic indicators that the vulnerable sectors of our society know are pangs of hunger. And while everything may look beautiful in the Treasury books, the picture could become ugly outside.
Again I must say that I am not an economist. All I know is that we must wake up and smell the coffee and know that what is brewing in the kitchen is trouble.
Paul Mwangi is an advocate of the High Court of Kenya