Watching Kenyan news this last week has really vindicated my beliefs that Kenyan's have a serious case of amnesia. 10,000 litres of milk were poured out with impunity and just yesterday Maize was rotting in Rift Valley. The milk case was just horrible because as my dear aunt told me on Friday evening. It would even have been more prudent for the milk to be put outside the factory gates for the public to come and consume to their discretion. However before I rant further which is clearly not in the spirit of this blog, one must ask themselves; what's the matter? Analysing this can be voluminous, but I'd like to try with some of John Locke's wisdom.

In the Wealth of Nations by Adam Smith, John Locke is quoted as saying;
All other moveable goods are of so consumable a nature, that the wealth which consists in them cannot be much depended on; and a nation which abounds in them one year may, without exportation, but merely by their own waste and extravagance, be in great want the next. Money on the contrary, is a steady friend, which though it may travel about from hand to hand, yet if it can be kept from going out of the country, is not very liable to be wasted and consumed
The meaning of all this is that commodity dependent countries are not good candidates for sustained growth. Due to the consumable nature of commodities especially in countries where impunity and corruption is rife (KENYA!!!), waste and extravagance will stifle growth. This is nothing new in Africa. However, this is not to say that commodity rich countries cannot thrive, this is merely to say that money, and not commodities is the main driver of growth. John Locke then concludes by stating that "increasing money is the great object of a country's political economy". 

I still feel that this is too shallow an analysis, I will thus follow this post up with part 4 of the Future Capital Series. However, it is something to digest, we should stop with the notion that the more food, copper, gold and oil we have, the more we'll grow. It's a bit like saying that a person with 100 beers worth 80Ksh each is better off than the person with Ksh 6,000. The consumable nature of the beers is no match to the multipliable nature of the Ksh 6,000.

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