The
Talensi by-election is over and political parties are counting their losses and
gains. Despite the few skirmishes of attacks on some NPP and NDC members from
unidentifiable persons (so far), it is reported that the actual voting exercise
was successful. Despite the so-called economic hardships in Ghana, the ruling
NDC-led government recaptured their old seat. To some social commentators and
political analysts, the Talensi seat has always been an NDC seat, so it is not
surprising they won. To some economists like Sydney Casely-Hayford, a win for
the NDC provides no additionality to parliamentary checks and balances. All of
these reasons are good and are context-specific. It appears that these reasons
are traditional and do not draw implications for future elections. An
alternative reason may therefore be additive.
In
this brief note, I suggest that the dynamics between the level of urbanization
and macroeconomics play a major role in influencing political decision-making.
Very often, the free market philosophers like some NPP sympathizers and
activists cite illiteracy and tribalism as the major reason why the rural areas
usually vote for the NDC. Timeously, just
when I was looking for a reference, John Boadu, the National Organizer of the
NPP availed himself opining as cited by Okoampah-Ahoofe (2015) that: “I was thinking that the people of
Talensi would look at the maladministration, the incompetence and corruption of
this government and vote against them. Impoverish the people, [and] if it is
time for election, come and pretend as if you are bringing development to win
their votes, which is a sad day for Ghana. My view is for the people of this
country to get state institutions to do the right thing” Interesting!!!
I wish to state here that it is this
entrenched notion of somehow wrong diagnosis of the factors that determine
voting decisions that may cause the NPP the 2016 election. What is my point? A
better understanding of the dynamics of the rural/urban divide vis-à-vis the
macroeconomics can influence the political fortunes of the NPP and the NDC. The
NDC has very often gotten this strategy right. No doubt that most NPP
commentators are good at analysing the macroeconomic effects on national
development in the media and they expect everyone to care about macroeconomic
mismanagement and corruption etc. however, when it comes to winning elections,
well-informed strategy is indispensable other than the parading of
macroeconomic lessons. Therefore, as cited by Kades (2002) and recently by Arthur
Kennedy of the NPP, Tip O’Neal’s adage that “all politics is local” may be
true. “In Talensi, campaigning on
“Dumsor” and the struggles of the Cedi against the dollar proved to be at best
inappropriate” (Kennedy, 2015). However, from O'Neal's adage, the word local is vague and
subject to different interpretations and questions like: what is the meaning of
local? How do we define the geographical boundaries of local? Is it possible
for external factors to influence local politics?
Based on these questions, I contend that
it is rather the level of urbanization than just local politics that determine
voting trends. This is because the level of urbanization in an area determines
which external factors can influence local politics. In other words, if we
define local to mean the geographical boundaries of Talensi, then local
politics will determine voting trends in so far as Talensi is rural and cut-off
from national trending issues like “Dumsor” and the cedi’s depreciation etc.
This is where deductive reasoning is constrained because logically, the
geographical boundaries of Accra or any of the other cities (urban areas) can
also be considered as local, however, it is not only the local politics in
Accra that determine voting trends in same. External factors including international issues like the
recent global financial crisis and broad macroeconomic issues like exchange
rates fluctuations, high unemployment, high and volatile inflation and interest
rates greatly influence the well-being of voters in the urban area (and to a
lesser extent voters in the rural area), and thus will influence voting trends
greatly. In effect, it rather the degree to which the local economy is
integrated into the national economy (typically described as contagion in
economics and finance) that determines which factors influence voting
decisions. Further explanation to this phenomenon is what this article seeks to
provide.
It is also fair to make a comment on
Arthur Kennedy’s assertion that: “nearly
6 in 10 of the voters in Talensi rejected the NDC candidate. It means that
translating this into Presidential terms, the NDC can be beaten in 2016 in
Talensi. This should give a lot of encouragement to the NPP and worry the NDC
quite a bit, particularly since this is in the north where they are supposed to
be strong”. First, how this statistic was calculated and the inputs used
are unknown. Even more important is the fact that this statistic tells us very
little about future elections in Talensi just like the claims of the President
and the NPP’s Presidential flagbearer: Talensi will predict how 2016 national
elections go. From Arthur Kennedy’s article, the benchmark based on which this
conclusion was made is also unknown. For this conclusion to hold, a trend
analysis is required and it should satisfy the condition that, previous statistics
of this nature should be that less than 6
in 10 of voters in Talensi rejected the NDC candidate. That means that the
NDC performed better previously compared with the recent by-election. In
summary, this conclusion is a complete statement that need justification to be
valid and reliable.
To proceed, the definition of macroeconomics
is useful to enhancing our understanding of the arguments made in this note.
Macroeconomics deal with aggregated indicators of economic growth, prices of
goods and services and the factors that affect these parameters, such as
inflation, interest rates, exchange rates, unemployment rates etc. These
macroeconomic indicates have systematic effects, in that it affect a large
portion of the national economy, depending on the degree on integration of the
local economies. In well-integrated economies, the effects of macroeconomic
indicators and hence contagion (the spreading of an effect) are higher. Just a
look at these macroeconomic measures provides some explanation to why despite
the profuse critique of the NDC-led government as bad managers of the economy,
the party still won the Talensi by-election. So why is it that NDC-led
governments are usually characterized for high inflation, astronomical interest
rates, high unemployment rate and exchange depreciating, yet the party keeps
winning seats in the rural areas? At least, barring all irrationalities such as
the popular reference – illiteracy and ethnicity songs sung by the opposition –
does bad macroeconomic management influence the political decisions made by the
rural folks? Generally yes, but critically no and this is due to the level of
urbanization in a country ― the degree to which the local economy is integrated
into the broader national economy.
The modernization of space due to
urbanization is implicitly linked with the urban economy and subtly to the
rural economy. Thus, the rural/urban economy divide is an important
consideration usually ignored by most of the social commentators, political
analysts and economists. This is why it is important. Every economy must
produce the goods and services it needs, and where the economy is unable to
produce these goods and services, it must import them if the economy is
open. Within a country, there is a
difference between the goods and services consumed by the rural economy and
those consumed by the urban economy. When modernity requires the consumption of
some goods and services that the local economy does not produce, and in the
case of Ghana goods like cars, fashion, building materials like tiles, clinker
for cement production and some finishes, amidst macroeconomic fluctuations, the
urban economy suffers directly while the effect are slight on the rural
economy. This is because the rural economy is largely delinked from the use of
these goods and services. I will discuss these goods and services mainly in
terms of basic necessities like food, shelter, transportation, education etc.,
which normally constitute the large proportion of expenditure in low-income
countries.
First, most buildings like the “atakwame”
buildings in the typical rural areas are built with unstandardized materials
like mud for the walls with sticks for reinforcement and thatch for roofing,
which are usually free. Very little foreign materials are used and so owners
are quite insulated from the effects of building cost inflation. On the other
hand, the urban economy must abide by planning standards and building codes
that require the use of building materials whose prices are affected by
macroeconomic fluctuations.
Second, in a business sense, the rural economy
is usually agragrian and relies on unsophisticated farming tools. They barely borrow
from financial institutions to buy sophisticated machines like harvesters and
planters etc. and hence are rarely affected by the increases in interest rates,
which most urban people talk about daily. Third, in terms of food, the agrarian
nature of the rural economy - on a subsistence basis – means that people eat
what they produce and sell or store the surplus. There are rarely modern food
shops like restaurants and fast food joints where one can buy food that has
foreign (imported) components and for that matter affected by effects of bad
economic management like inflation or exchange rate depreciations. They don’t
usually drink sachet water and bottled water, as is the case in urban centres,
which are all affected by high inflation.
Fourth, in terms of education, most of the
schools in these rural areas are public and usually free at least at the basic
level. This is where most of the rural folks end their academic journey, and so
they do not feel the pressures of high school fees and costly text books, high
transportation cost to school etc., which is a major feature in urban areas. In
fact, the major mode of transaction in the rural areas is usually by foot.
Apart from walking long distances to the farm and back, fewer distances are
covered should the rural folks visit their families and friends due to the
compactness of rural settlements. Most often, family members lived in the same
house and friends are just nearby, so there is very little need for modern
transportation equipment like cars and their associated costs. The nature of rural
settlements actually offers cost-saving opportunities. Fifth, on employment, it
could be said that there is full employment in the rural settings. Almost
everybody has a farm or work in a farm or some other informal job. The
so-called high unemployment rate is just an urban phenomenon.
From this brief discussion of the
characteristics of the rural and urban economies, it is clear that there is a
vast difference in the factors that influence political decisions. It is clear
that in the urban areas, national macroeconomic variables like inflation,
interest rate and exchange rate movements as well as unemployment may be
significant and important. Conversely, in the rural areas, social factors like
family ties, ethnicity etc. may be the major determinants of political
decisions-making. It is not that the rural folks are irrational, as political
activists tend to present to us; rather it is simply information asymmetry and
the inefficient transmission of hardship resulting from economic mismanagement
to the rural economy due to the disjoint between the rural economy and the
urban economy.
Implications
of Economy Characteristics for Political Strategy and Campaign
Simply, the rural economy is quite insulating
from the macroeconomic effects of economic mismanagement. So, campaigning on
economic hardship as a result of high inflation, high interest rates and
exchange rates will not fly because the rural folks barely feel the effects of
bad economic governance and management. Politicians must focus on the social
issues like getting closer to the poor folks and showing them some respect –
these are more important. This is where the elites and their parties like the
NPP may have some challenges. They should stop talking about macroeconomic
mismanagement when they campaign in the rural areas because the rural folks are
not even likely to understand all the jargons they sometimes use.
The implications are that,
if government wants to stay in power for long, it must focus on small
infrastructure in the rural areas – build more toilets, provide bole holes,
schools, provide basic agricultural tools like machetes, fertilizers etc. In
the urban areas as places of modernity, the government must concentrate on
building world-class infrastructure and focus on the macroeconomy; reduce
inflation, interest rates, and exchange rates, provide jobs etc. This is a
simple approach to winning and sustaining power in countries with low
urbanization levels, like Ghana.
In essence, there is a strong link between the
level of urbanization in a country and economics as they affect political
decision-making. The level of urbanization in a country determines the degree
to which all the local economies in are integrated into the broader national
economy and hence the speed with which macroeconomic effects affect the lives
of the rural economy and people. These factors therefore influence how the
ruling government is assessed by the rural folks and then determine the effect
of macroeconomic performance on voting. Maybe, we should review the traditional view that illiteracy
and tribalism determines voting patterns in some areas like the North!
Kenneth A. Donkor-Hyiaman
