01.05.2000 Feature Article


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Santa Cruz, CA - When US Treasury Secretary (the equivalent of Ghana's Finance Minister) announced his resignation in the second week of May 1999, three thoughts danced through my mind: First, I kept wondering why a person of his caliber - who has been steering the US economy to one of its prosperous periods, and widely acclaimed as one of the greatest Treasury Secretaries in US history - should resign. Second, I also wondered aloud why in our part of the world stories about voluntary resignations are extremely rare, even when it was clear that people were operating with diminished capacities, and were basically recycling their outlandish ideas. In our world, normally if people lost their political jobs, it was either via death or, by given the boot by Dr. Globetrotter who saw them as taking too much of the "Political Retirement Money" and were thus leaving him with little to send his kids to universities abroad and or "buy" another honorary doctorate degree. Third, and probably most important, I thought about when we would be lucky to have our own Rubin who could steer us through the muddy waters to the elusive Promised Land. Where are our own visionaries? And thinking about visionaries, it dawned on me that we have a leviathan-but-lacking-specifics official document dubbed VISION 2020. But given that the problems of Ghana are all too known, it should not take much effort to write such a document. What is very difficult and takes a lot of effort is how to process this document to in order to realize its goals and objectives. So it appears that the VISION 2020 is still in its vision stage. And the natural question, therefore, is how and when do we reach the PRINCIPLE stage, the POLICY stage and finally the ACTION stage? Are we really serious about following through the tenets of the Vision 2020 document or its just another official document designed for the political shelf only to bite the dust? Are we, as a nation, convinced that we truly are readying ourselves for global competition in the next millennium? The fundamentals of our national economy and our political approach to crucial issues upon which the realization of the tenets of the Vision 2020 is antecedent suggest that we are not positioning ourselves very well for the challenges of the next millennium. Let's take a quick tour of some of the fundamentals of the economy. Our population is growing at about 3% annually; infant mortality is still high at 69 per 1000 live births; only 56% of the population has access to safe water; GNP per capita (if we devide our national income by the total population) is only $370; 31% of the population is below national poverty line; the average growth rate of the economy (1987 - 1997) is about 4.4% and at this rate there is no way we can become a middle income country by 2020; the economy is mainly rural with cocoa, timber, pineapples and lately mining as main exports; the economy is made up of 47% agriculture, 17% industry and 36% services, revealing a very weak industrial base.

However, if there is any indication of our unpreparedness for the next millennium, it is the state of education in the country. Needless to say, the key to achieving the goals of Vision 2020 and importantly being able to compete regionally and globally is education. Yet the standard of our educational system is at its all-time nadir simply because education does not seem (so to speak) to be in our national top-priority bracket. And when you hear stories about our political leaders circumventing the problem by sending their kids to school abroad (are they that rich?) and the president allegedly donating $250,000 to the Lincoln University in Pennsylvania, USA, while our schools' facilities deteriorate, you may want to cry, or go coochy-coochy-coo, or depending on your sensibilities, go to the bathroom and retch.

It does not take more than average human intelligence to recognize that we neglect education at our peril, especially in the coming decades. This is because economies are moving from physical economy (the classical view of economic growth) to knowledge economy (the New Growth Theory). In the physical economy, growth is driven by the production of physical goods - resource extraction and commodity production, which is characterized by diminishing returns. In the knowledge (Information) economy, however, it is knowledge, as a third factor in the production process along with capital and labor, that drives economic growth. And whereas scarcity of resources and diminishing returns put constraints on long-term growth in the physical world, ideas - which drive knowledge - are not scarce, and the process of innovation and discovery is driven by increasing returns according to the New Growth Theory. This is because the generation of ideas is tantamount to cross-pollination in which new ideas beget more ideas, knowledge grows in leaps and bounds, and with it productive capacity. This is what Martin Weitzman of Harvard University calls "recombinant" innovation, in which old ideas are re-configured in new ways to produce goods and services. Over the short term, recombinant innovation may lead to low economic growth rates but over a longer time horizon, it overtakes even a geometric expansion. Thus for N innovations, there are N(N-1)/2 possible binary combinations causing growth to become faster than exponential. A very good example of how ideas are reconfigured to produce new ideas is the invention of the computer. Scientist understood the principles underlying magnetic data storage in the early 1900s long before the discovery of the transistor. The discovery of the transistor, followed by the central processing unit (CPU), led to the revival of the magnetic data storage technology. Essentially the computer was created by combining the recently discovered CPU with the much older discovery of magnetic storage.

Matter-of-factly, the more we learn and discover the better we get at learning and discovering. This explains why the world has had more growth in the last 100 years than in the previous 900 years. And this should be a premonition about the economic calamity is in store for us in the next century if we fail to give education the attention and resources it deserves. It is not so much about our capacity to generate new ideas as it is about our capacity to process them and it takes sound education to do that.

It bears reiterating that economic development depends on the quality of a nation's population which in turn depends on the quality of education provided. Nobody can underestimate the significance of education: it enables the peasant farmer to see and understand things beyond his/her milieu and to make rational economic and scientific decisions; it enables the factory worker to absorb new-fangled ideas and information and adjust to the ever-changing economic and technological circumstances. If the oodles of news-media publicity about the morass of complaints about education in Ghana is anything, it not only unfolds a system in abject deterioration that is not ready to provide the people with the skills necessary to compete in the next millennium, but also makes the realization of our Vision 2020 goals a very remote possibility. Education should be above politics in all respects.

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