At 80% voter literacy, civic engagement changes tune:
US reached ~80% in 1776
Tunisia reached 80% in 2010
Kenya has now reached 83% literacy...
As highlighted in previous posts at AfricanAccelerationism, the biggest barrier to accelerating wealth, health, irrigation, transport, crop yields, jobs, etc is…
drum roll🥁…
good governance.
Only the citizens can enforce good governance—not the UN, not the international community and definitely not multinational corporations, which benefit from corruption as often as not. If only the people would hold their governments accountable…
…oh wait, what’s this I’m hearing?
…Kenyans lit parliament on fire?…
The good news
For those of you who haven’t closely followed the events in Kenya I want to share a quick summary for why we should double down on investments in Kenya. The protests are great news for accelerating growth in Kenya and perhaps Africa.
Kenya’s $2b Eurobond was due in June. Kenya borrowed more money to pay the loan. Kenya would not default like so many other African countries have the last few years (Ethiopia, Zambia, Ghana). Good news! the Kenyan Shilling improved against the dollar from 165 to 130 in a matter of weeks.
Google
All seemed fine.
But of course you need to pay off the new loan by either cutting costs or increasing taxes.
Kenya is doing relatively well with a growing middle class. Technically, Kenyans could afford to pay more taxes. After all, Kenya's tax collection rate is only 14% of GDP compared to 27% in the US or ~45% in Europe.
But that superficial treatment would lead you astray.
Dive into the gory details of the Finance Bill 2024, and you’ll find that the tax increases weren’t really going to be spent paying off debts. Just to name a few items:
$5m to refurbish the state house
$20m for the first, second and third ladies. (Excuse me, what is a third lady?)
Increased salaries and benefits for politicians, who already make disproportionately large salaries:
The youth started to protest. At first, this seemed like a normal Kenyan protest: one political party pays jobless youth to make some noise.
But this was different—completely different. The protesters were middle-class Kenyans. Kenyans noted that “even Kenyan Indians” were at the protests. The protests were unusually peaceful, with little looting. “Leader-less, Tribe-less, Fear-less” is an oft-repeated phrase, a huge change from the 2007 tribal post-election violence.
But the peacefulness was one-sided.
During the protests, police officers shot and killed unarmed protesters. So far 41 protesters are confirmed dead.
source unknown
Jamia mosque was the first to start offering a safe space for protesters while Basilica of the Holy Family closed its doors. Doctors and others volunteered on the street to treat the injured, shops provided food and water to protestors.
In churches, youth interrupted the services to demand to know “Reject or not?” putting pastors on the spot.
Sadly, the government wasn’t fully supportive of freedom of speech. Tens, if not 100s, of youth leaders were held in jail without cause:
The internet became unstable and Safaricom, the largest internet provider, claimed an undersea cable had been cut. An international internet observer says no such cable cut had occurred. Elon Musk provided Starlink at a 50% discount and promised even more affordable, uncensorable internet for Kenya by the end of the year.
On July 26th, Parliament, despite the protests, voted to approve the finance bill stuffed with benefits for politicians with no clear connection to paying off the sovereign debt. Within an hour, the youth stormed Parliament and set it on fire:
source unknown
Pres. Ruto then conceded he would not sign the bill into law. As a concession, he proposed cutting many of the line items in half. This appeasement was not received well.
MPs who voted yes made lame excuses. One claimed to have been asleep during the vote count of the most critical bill of the year and must have “accidentally” agreed in his stupor:
Protests moved from the street to online, which reduced deaths and made it harder for looters to infiltrate.
A GPT was created for listing the corruption scandals of politicians, just type in their name:
A Promise Tracker was created to measure Ruto’s campaign promises against results.
The movement made a list of 14 demands:
Ruto held an interview with the main TV stations in Kenya where he appeared out of touch: When asked about a boy who had been shot 8 times, the president asked, “But he’s still alive right?”
So far, neither the president nor major leaders who voted for the Finance Bill have visited any of the 300 injured by police brutality in the hospital.
Kenyan podcaster Adelle Onyango released a video reminding Kenyans that politicians are “our employees, and we should hold them to account.”
Ruto offered to meet the GenZ leadership one-on-one, but the movement rejected the legitimacy of any meeting held behind closed doors and instead demanded Ruto appear on X Spaces.
On Friday, Ruto became the first head of state in the world to address his constituents on X Spaces. And agreed to remove most of the new taxes.
But GenZ was not done. This was not about taxes anymore but about holding the government accountable. An estimated $1.4b of taxpayer money disappears each year due to corruption. Recovering stolen taxpayer money could repay the IMF debt of $2.5b in a matter of weeks.
Investment managers who had stolen $10m from the social security fund lost their appeal in the High Court:
GenZ made a list of 50 demands, including that the president appear on X Spaces bi-monthly to report on his progress on the 50 demands and audit the government debt. During the former Kibaki government, the national debt was reported in the newspaper monthly. The debt has not been reported in years, and the president seems unaware of the actual debt level.
Ruto set up a task force to audit the debt over the next three months and nominated the well-respected President of the Law Society of Kenya, Faith Odhiambo, as a member, among others. The LSK president declined the appointment and denounced the task force as unconstitutional. claiming there already is an Auditor General for this purpose, and duplicative government spending precipitated the protests in the first place.
Protests have now spread around Kenya—a Governor's office was stormed by protestors demanding to see where their money had gone. Protests in Nigeria, Uganda and Tanzania are already gearing up. Murmurs of an “Arab Spring” are in the air.
As a blessing in disguise, the international community responded by reducing Kenya’s credit rating from B3 to Caa1 (or, in layman’s terms, from a B- to C+), citing the rejected Finance Bill. If the parliament burning was not enough, this will further inhibit borrowing until the government cleans house…
Which is exactly what happened Thursday when the president fired his entire suite of Cabinet Secretaries:
Why did things suddenly change?
Who knows….But allow me to speculate anyways…
A tipping point has been reached. People got annoyed enough and they got empowered enough.
Kenya has one of the higher literacy rates in continental Sub-Saharan Africa.
When you look at other major upheavals that not only challenged government but had staying power, something special happened around 80% literacy rate.
The electorate in the American Colonies (later known as the United States) reached ~80% literacy in 1776, compared to 40% literacy in England and 29% in France (perhaps why the French Revolution lead to the Reign of Terror and Napolean instead of stability).
Tunisia, the spark that lit the Arab Spring in 2010, had a literacy rate of… wait for it…80%.
In 1884, all (men) in the UK received the right to vote, at almost exactly 80% literacy.
South Africa’s literacy rate reached about 80% in 1994, the end of apartheid.
Kenyan protests are not a one-off. The cat is out of the bag, and nothing the government can do will put it back in, not that they won’t try or that there won’t be setbacks. We won’t go back to business as usual in a few weeks.
African Accelerationism ↗️, right on schedule
Ultimately, many of the reforms needed for Africa to take advantage of its natural resources and abundant human capital require a functioning government that doesn’t siphon off $20m for the first, second and third ladies, not to mention the $1.4b annual grand theft by the politically connected that evaporates 30% of the budget.
Many of the challenges in Kenya exist because the people in government positions don’t want the problems to be fixed. Land ownership is not digitized because the people in the land registry benefit from a vague, corruptible system. The cost of drilling boreholes is high because the people in the Water Resources Authority created a cartel that enables them to get kickbacks for every well approved. In addition to the official $2,000 work permit fee, a foreigner trying to create jobs in Kenya must grease many palms because the system is made intentionally cumbersome.
But that’s starting to change. Paying off officials in shakedowns was just the way to keep your head attached to your neck. This week, Tatu City development revealed that the Kiambu county Governor attempted to steal 40 prime acres. And it looks like this time he won’t get away with it:
from Tatu City presentation
The only way for a government to improve is for people to recognize that they are in charge, that the government employees are their employees and hold those employees to account.
Fear-less, Leader-less, Tribe-less.
It’s happening.
Time to keep investing in Kenya.
We are hosting the HakiHack hackathon for government accountability on the 18th of August.
If you can donate we’d really appreciate. All funding goes to the winners of the event to reward their great work for accountability in Kenya.
How protests will spur investment in Kenya and the magic of 83% literacy
How protests will spur investment in Kenya and the magic of 83% literacy
How protests will spur investment in Kenya and the magic of 83% literacy
We are hosting the HakiHack hackathon for government accountability on the 18th of August.
If you can donate we’d really appreciate. All funding goes to the winners of the event to reward their great work for accountability in Kenya.
Donate
More info at HakiHack.co.ke
At 80% voter literacy, civic engagement changes tune:
US reached ~80% in 1776
Tunisia reached 80% in 2010
Kenya has now reached 83% literacy...
As highlighted in previous posts at AfricanAccelerationism, the biggest barrier to accelerating wealth, health, irrigation, transport, crop yields, jobs, etc is…
drum roll🥁…
good governance.
Only the citizens can enforce good governance—not the UN, not the international community and definitely not multinational corporations, which benefit from corruption as often as not. If only the people would hold their governments accountable…
…oh wait, what’s this I’m hearing?
…Kenyans lit parliament on fire?…
The good news
For those of you who haven’t closely followed the events in Kenya I want to share a quick summary for why we should double down on investments in Kenya. The protests are great news for accelerating growth in Kenya and perhaps Africa.
Kenya’s $2b Eurobond was due in June. Kenya borrowed more money to pay the loan. Kenya would not default like so many other African countries have the last few years (Ethiopia, Zambia, Ghana). Good news! the Kenyan Shilling improved against the dollar from 165 to 130 in a matter of weeks.
All seemed fine.
But of course you need to pay off the new loan by either cutting costs or increasing taxes.
Kenya is doing relatively well with a growing middle class. Technically, Kenyans could afford to pay more taxes. After all, Kenya's tax collection rate is only 14% of GDP compared to 27% in the US or ~45% in Europe.
But that superficial treatment would lead you astray.
Dive into the gory details of the Finance Bill 2024, and you’ll find that the tax increases weren’t really going to be spent paying off debts. Just to name a few items:
$5m to refurbish the state house
$20m for the first, second and third ladies. (Excuse me, what is a third lady?)
Increased salaries and benefits for politicians, who already make disproportionately large salaries:
The youth started to protest. At first, this seemed like a normal Kenyan protest: one political party pays jobless youth to make some noise.
But this was different—completely different. The protesters were middle-class Kenyans. Kenyans noted that “even Kenyan Indians” were at the protests. The protests were unusually peaceful, with little looting. “Leader-less, Tribe-less, Fear-less” is an oft-repeated phrase, a huge change from the 2007 tribal post-election violence.
But the peacefulness was one-sided.
During the protests, police officers shot and killed unarmed protesters. So far 41 protesters are confirmed dead.
Jamia mosque was the first to start offering a safe space for protesters while Basilica of the Holy Family closed its doors. Doctors and others volunteered on the street to treat the injured, shops provided food and water to protestors.
In churches, youth interrupted the services to demand to know “Reject or not?” putting pastors on the spot.
Sadly, the government wasn’t fully supportive of freedom of speech. Tens, if not 100s, of youth leaders were held in jail without cause:
The internet became unstable and Safaricom, the largest internet provider, claimed an undersea cable had been cut. An international internet observer says no such cable cut had occurred. Elon Musk provided Starlink at a 50% discount and promised even more affordable, uncensorable internet for Kenya by the end of the year.
On July 26th, Parliament, despite the protests, voted to approve the finance bill stuffed with benefits for politicians with no clear connection to paying off the sovereign debt. Within an hour, the youth stormed Parliament and set it on fire:
Pres. Ruto then conceded he would not sign the bill into law. As a concession, he proposed cutting many of the line items in half. This appeasement was not received well.
MPs who voted yes made lame excuses. One claimed to have been asleep during the vote count of the most critical bill of the year and must have “accidentally” agreed in his stupor:
Protests moved from the street to online, which reduced deaths and made it harder for looters to infiltrate.
A GPT was created for listing the corruption scandals of politicians, just type in their name:
A Promise Tracker was created to measure Ruto’s campaign promises against results.
The movement made a list of 14 demands:
Ruto held an interview with the main TV stations in Kenya where he appeared out of touch: When asked about a boy who had been shot 8 times, the president asked, “But he’s still alive right?”
So far, neither the president nor major leaders who voted for the Finance Bill have visited any of the 300 injured by police brutality in the hospital.
Kenyan podcaster Adelle Onyango released a video reminding Kenyans that politicians are “our employees, and we should hold them to account.”
Ruto offered to meet the GenZ leadership one-on-one, but the movement rejected the legitimacy of any meeting held behind closed doors and instead demanded Ruto appear on X Spaces.
On Friday, Ruto became the first head of state in the world to address his constituents on X Spaces. And agreed to remove most of the new taxes.
But GenZ was not done. This was not about taxes anymore but about holding the government accountable. An estimated $1.4b of taxpayer money disappears each year due to corruption. Recovering stolen taxpayer money could repay the IMF debt of $2.5b in a matter of weeks.
Investment managers who had stolen $10m from the social security fund lost their appeal in the High Court:
GenZ made a list of 50 demands, including that the president appear on X Spaces bi-monthly to report on his progress on the 50 demands and audit the government debt. During the former Kibaki government, the national debt was reported in the newspaper monthly. The debt has not been reported in years, and the president seems unaware of the actual debt level.
Ruto set up a task force to audit the debt over the next three months and nominated the well-respected President of the Law Society of Kenya, Faith Odhiambo, as a member, among others. The LSK president declined the appointment and denounced the task force as unconstitutional. claiming there already is an Auditor General for this purpose, and duplicative government spending precipitated the protests in the first place.
Protests have now spread around Kenya—a Governor's office was stormed by protestors demanding to see where their money had gone. Protests in Nigeria, Uganda and Tanzania are already gearing up. Murmurs of an “Arab Spring” are in the air.
As a blessing in disguise, the international community responded by reducing Kenya’s credit rating from B3 to Caa1 (or, in layman’s terms, from a B- to C+), citing the rejected Finance Bill. If the parliament burning was not enough, this will further inhibit borrowing until the government cleans house…
Which is exactly what happened Thursday when the president fired his entire suite of Cabinet Secretaries:
Why did things suddenly change?
Who knows….But allow me to speculate anyways…
A tipping point has been reached. People got annoyed enough and they got empowered enough.
Kenya has one of the higher literacy rates in continental Sub-Saharan Africa.
When you look at other major upheavals that not only challenged government but had staying power, something special happened around 80% literacy rate.
The electorate in the American Colonies (later known as the United States) reached ~80% literacy in 1776, compared to 40% literacy in England and 29% in France (perhaps why the French Revolution lead to the Reign of Terror and Napolean instead of stability).
Tunisia, the spark that lit the Arab Spring in 2010, had a literacy rate of… wait for it…80%.
In 1884, all (men) in the UK received the right to vote, at almost exactly 80% literacy.
South Africa’s literacy rate reached about 80% in 1994, the end of apartheid.
Kenyan protests are not a one-off. The cat is out of the bag, and nothing the government can do will put it back in, not that they won’t try or that there won’t be setbacks. We won’t go back to business as usual in a few weeks.
African Accelerationism ↗️, right on schedule
Ultimately, many of the reforms needed for Africa to take advantage of its natural resources and abundant human capital require a functioning government that doesn’t siphon off $20m for the first, second and third ladies, not to mention the $1.4b annual grand theft by the politically connected that evaporates 30% of the budget.
Many of the challenges in Kenya exist because the people in government positions don’t want the problems to be fixed. Land ownership is not digitized because the people in the land registry benefit from a vague, corruptible system. The cost of drilling boreholes is high because the people in the Water Resources Authority created a cartel that enables them to get kickbacks for every well approved. In addition to the official $2,000 work permit fee, a foreigner trying to create jobs in Kenya must grease many palms because the system is made intentionally cumbersome.
But that’s starting to change. Paying off officials in shakedowns was just the way to keep your head attached to your neck. This week, Tatu City development revealed that the Kiambu county Governor attempted to steal 40 prime acres. And it looks like this time he won’t get away with it:
The only way for a government to improve is for people to recognize that they are in charge, that the government employees are their employees and hold those employees to account.
Fear-less, Leader-less, Tribe-less.
It’s happening.
Time to keep investing in Kenya.
We are hosting the HakiHack hackathon for government accountability on the 18th of August.
If you can donate we’d really appreciate. All funding goes to the winners of the event to reward their great work for accountability in Kenya.
Donate
More info at HakiHack.co.ke