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Why insecurity is Problem Number 1

Insecurity will be our undoing. If there is a single thing that stands in the way of economic growth and development, it is the fact that violent crime is out of control. If a populace does not feel safe then there is no future. It’s really as simple as that. It doesn’t really matter what you spend your time thinking about: party politics, development aid, your next car or the type of underwear our newest young celebrities wear. All equally irrelevant. If we do not do something about rampant insecurity, we are all cooked.

How so? We have got to the point in Kenya where being the victim of a violent attack is no longer a matter of dry statistics or probabilities. I do not think there is a Kenyan alive who does not feel the threat of violence hanging over him or her like a malevolent cloud. Human beings react to their own observation of reality, and to anecdotal evidence gathered from the people around them. In other words, if you, your family or your neighbours have been attacked, it matters not a jot whether the average crime figures in your district are going up or down. To you, crime and violence is suddenly real, clear and present. And your decisions with regard to key areas of your life will now start to change.

It is in decisions that the problem lies. Contrary to myth, countries, companies and families are not built on strategies and plans; they are built on the actual decisions that are made at critical junctures in their development. Decisions drive performance: the decision to invest; the decision to hire; the decision to relocate. One of the enduring lessons I have learned as a management consultant is that value is created or destroyed at the point at which decisions are made. Whether we succeed tomorrow depends entirely on the decisions we make today.

And what decisions do we make in an environment where we are fearful? Bluntly, all the ones that cripple the future economy. Let us take a tour through the minds of different decision-makers.

Let’s start with investors, and here let me tell you one thing: if the returns are right, most investors can live with many obstacles and risks. If potential profit margins are high enough, many investors are not deterred by poor infrastructure. They will make their own ‘second-best’ investments in that area. Do we not see it all the time? If profits are booming, companies use planes rather than drive on battered roads. They install their own satellite dishes and local networks, they buy generators. But if there’s one thing they can do nothing about, it’s unchecked violent crime. Low-level crime is not a problem; guards, alarms and fences are all affordable. But when the frequency of violent attack becomes as high as it is in Kenya today, money and profits don’t help you. Uncontrolled violent crime is the most serious deterrent to new investment, whether foreign or local. Forget new investment; our immediate problem is hanging on to the old, as business people consider their futures.

And what happens to the consumer, that enviable economic agent with some money to spend? Any consumer living in fear of violent attack starts to divert spending: away from refrigerators and TV sets, and towards fences, locks and reinforced doors. He or she spends less and less time going out at night. A more modest, innocuous car is preferred to one that attracts attention. That deposit on a house is delayed until the atmosphere is more encouraging.

Savers? They certainly tend to put more money away in uncertain times, which is a good thing, right? Here’s the catch: they don’t put it in the economy that’s fuelling their uncertainty. Globalised financial markets make it all very easy: put your money in secure havens. And a country that seems helpless in the face of thuggery is anything but that. Capital flight out of countries like ours is driven less by greed than by fear.

What about workers, and especially the high-skill knowledge workers that are the brains behind the economy – the professionals, managers and technocrats? Alas, another globally mobile economic asset. How many skilled people have you spoken to in recent months who are actively thinking of relocating – and are acting on it? And what is the reason given? Nine times out of ten, in my informal sampling, it’s because of the fear of violence. That is a simple, visceral reaction to an atmosphere of fear: “Let me out of here.” It has nothing to do with skin colour, patriotism or opportunism. There are degrees of fear that no human being tolerates. And just how much loss of human capital can a small economy withstand?

So, that is what a prevailing atmosphere of fear of violent crime does to an economy. Productivity falls, through loss of life, migration of skills and by reducing the incentive to work hard. Investment withers, as victims leave the country and potential investors stay away. Social costs in the economy climb: additional burdens on justice and anti-crime systems; the costs of private security arrangements; physical and psychological scars borne by victims. The quality of life in the country is poisoned: a mood of fear, hatred and paranoia prevails in everyday activity. Personal freedoms are lost. It all adds up: some estimates suggest that in the worst-hit countries the cost of crime is as high as a quarter of GDP.

So, can you think of anything that needs our attention more than insecurity? Most people can live with many things, but they cannot live with continual assaults on their person and family. Parents can carry many burdens, but not the burden of fear for the safety of their children. And here’s the nub: if government is perceived to be doing nothing, then people make their own decisions. Most of the decisions made by ordinary people involve surrender, giving up and moving away from the problem. Ask the besieged people of Ngong. That is not the stuff of which a thriving economy is made.

Spiritual teaching tells us that we must not give up. We must look for the source of security within ourselves. We must serve others, when times are good and when times are bad. Sadly, most economic agents make rather more prosaic decisions. As the Irish philosopher Edmund Burke put it more than 2 centuries ago: “No passion so effectually robs the mind of all its powers of acting and reasoning as fear.” That is why the most important job in the country today is not that of the President; it is that of the Commissioner of Police. Commissioner Ali at least appears to recognise the enormity of his task and is addressing it with a systematic management approach and a no-nonsense style. But he needs help: budgets, backing and management capacity. If there’s one thing Kenyans need to galvanise themselves for, it’s not worrying about who the next President will be; it’s how to help the present Commissioner to succeed where all his recent predecessors failed.

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