On Sunday, I was invited to dinner at Daniel and Naiyonde’s home, with their three kids (see blog post 2023.09.24 The New Maasai Warrior). I’m always happy when I don’t have to cook for myself, but it is even better when in the home of friends. I had a fascinating conversation about many things that I’ve been reading, and I wanted to process them through with Maasai who know the culture.
One interesting aspect was socialism. Now I’ve lived in colonial territory (Hong Kong), independent former colonial territory now socialist (Tanzania), uber capitalist republic (USA), and Scandinavian social democracies (Norway and Sweden, of which Sweden has a history as colonial empire).
After independence, Tanzania started with African socialism under the leadership of Julius Nyrere. The Arusha Declaration laid out their dependence upon human capital while alienating anyone with capital from leadership. It put all the resources—including land—under the control of the government. So, no one owns land in Tanzania. They buy a 99-year lease. At the end of the lease, the government doesn’t have to renew it, and any building assets will be assessed by their assessors for remuneration. The Nobel winning economist, Amartya Sen, talks about living capital and dead capital. Living capital are assets you can leverage (take a loan against) for investments, such as a business venture or education to raise one out of subsistence poverty to a sustainable livelihood. Sen’s argument (as I remember from a long ago reading) is that the number one way to facilitate development is to give land rights, then people have access to living capital.
In Tanzania, it is zombie capital (my metaphor here), as it is the living-dead capital. One can take a loan against their 99-year leased land, but I’m guessing if it is not toward the end of the lease time. And compare this with my condo mortgage in Sweden that is a 99-year mortgage. Yes, really. (This is a bit weird for me who had a 15-year mortgage on my house in Bellevue and made extra payments to shorten the time horizon, and then paid it off early with Eric’s life insurance payout.) Yes, I have 2 properties, so I would be excluded from leadership under the Arusha Declaration.
The curious conversation was that Daniel didn’t really see Tanzania as a socialist state, because now there is a capitalist-driven economy. This has raised Tanzania out from the dubious distinction of being one of the 10 poorest countries in the world in the early 21st century to now ranking 160th out of 190 countries and moving into the lower middle-income rating, according to the World Bank. https://blogs.worldbank.org/africacan/what-does-tanzanias-move-lower-middle-income-status-mean
My understanding is that because the government owns all the land, it is still socialism. When the people have permanent land rights, then it could transition to a social democracy—the language used in Scandinavia, though with significant differences, as Scandinavia is a welfare state which works relatively well due to high taxes and good transparency with government finances.
I’m sure I’ll keep having good conversations and learning more.
Mungu akubariki! (God bless you!)