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OPINION: Which political party will cut government spending?

Photo of Kenya Association of Manufacturers Chairman Mucai Kunyiha.
Mr Mucai Kunyiha, chairman, Kenya Association of Manufacturers.

As Kenya prepares for general election on 9 August 2022 political parties are promising different ways of running government. Kenya Association of Manufacturers says it expects to hear a political group promising to cut government spending. This would lead to reduced taxes. Chairman Mucai Kunyiha says the association is yet to hear any candidate promise to dismantle ‘bloated’ public service. This would support individual business and reduce opportunity for graft. Mr Kunyiha says voters and candidates must discuss the size and expenses of government because they pay for it by taxes.

He says voters must ask candidates where and how they would raise money for the projects and welfare schemes they promise. The source of all funding and expenditure must be a serious political question for debate, Mr Kunyiha writes.

The role and size of government have long troubled the social sciences and philosophy – from Socrates to [John] Locke, [Karl] Marx to [John Maynard] Keynes – and continues to date.

In Western thought and political discourse, this ideologically breaks down to the ‘Right,’ who are more motivated by free markets and lesser government, and the ‘Left,’ who are motivated by more controlled markets with differing levels of state intervention. These perspectives are rooted in long histories of political and economic development, peculiar to Europe and Western civilisation and somewhat distant to our Kenyan and African experience. That said, I would argue that we have real practical experience that makes the issue relevant to our political, economic, and social discourse within the bounds of our own unique experiences.

Government has no more resources than what it takes from us as taxes, levies, and fees

I start with the issue of funding. Our historical experience is that the government ‘came’ with colonialism. Although all our communities had developed their own ways and structures of organising themselves, these structures were suppressed and made subject to the singular, totalising colonial government that was all-powerful and well resourced. This has led to an alienation of government as foreign to society and coming from the outside as opposed to natural and intrinsic to our communities, an instinct that remains despite the independence narrative of government becoming ‘ours’. The consequence of this in our economic imagination is that the government came with overwhelming resources that dominated us. This has led to the belief that ‘government has money’ – in effect, the government is an endless flow of riches and resources that can be tapped, for better or worse.

The most persistent illusion of the colonial project is that the government came to bring us resources and good things, whilst history tells us it was all about extraction and exploitation. The reality is that the government has no more resources than what it takes from us as taxes, levies, and fees. There is no magic fountain at the National Treasury, only a tap connected to the tanks of the Kenya Revenue Authority. The fact is, we, the people, fund the government.

Our expenditure tends to favour the powerful and elite

Given that the entire government is at our cost, its size and cost ought to be a major point of political contention. Whereas the proposed purposes to which our taxes are put, for instance new infrastructure and schemes, are often a key determinant in our choice of leaders, we scarcely ask where and how they propose to raise funds. The source of all funding, and not just the expenditure, ought to be a serious political question for debate, and perhaps novel solutions.

Redistribution of wealth is a strong argument for the increased role of government. This aims to ensure that there is more equity and fairness amongst the citizens of the country by balancing economic opportunity. This has been a strong driver in developing countries such as Kenya where the government is thought to bring ‘development’. However, whereas our tax system has matured in collection, our expenditure tends to favour the powerful and elite, whether by outright corruption or in the choice of ‘development’ projects biased towards easing the lives and inconveniences of the well-to-do. Not to mention the creation of a multiplicity of cushy public sector jobs and roles for friends and supporters of those in power.

Where is the money coming from?

In Western economies, the size of government question is whether bureaucrats, however well-meaning and informed, will make better economic choices than individuals can make individually. The state is kept small to reduce the need for taxation and to allow citizens to have more cash in their pockets to make economic choices. In our context, I would argue that the historical evidence of incorrigible and systemic corruption in our political and societal culture makes it imperative to reduce the size of government to reduce waste and the opportunity for corruption. It is immoral, unjust, and counterproductive to our economic goals to continue to extract resources from our people for profligate and wasteful expenditure.

And so, as we hear many promises on government expenditure and gifts bestowed to favoured political constituencies, we must remember to ask, “Where is the money coming from?”

Perhaps, some political grouping will, for once, promise a reduction of spending in favour of reducing taxes and a dismantling of a difunctional and bloated public sector in favour of individual enterprise, reduced opportunity for graft, and choice for the individual citizen.

About Kaburu Mugambi

Kaburu Mugambi is a veteran of business reporting having worked with two national newspapers in Kenya. He is a graduate of economics from Kenyatta University. He started his journalism career in 2000 with The People Daily as a business reporter before becoming a business sub-editor. He joined Daily Nation in 2004 as a business writer. He holds a post-graduate diploma in mass communication from University of Nairobi's School of Journalism and an MBA in marketing from the same university. In 2016, he founded Water Tower, a media firm focused on water, energy and climate. Its content cuts across water, energy and climate with emphasis on adaptation and sustainability.

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