LOSERS 507African nations totaled $313 billion (almost 2.5 times total export in
come), so the $25 billion could pay the interest for one year. In the
meantime, of $231 billion in direct foreign investment in the Third
World in 1995, some $2 billion, less than 1 percent, went to Africa.
Businessmen know to go elsewhere.
No matter: accentuate the positive. The worse the situation, the
greater the potential for improvement. Better policies (structural ad
justment) can/will put Africa back on the growth track. But there
would still be lots to do. The continent's problems go much deeper
than bad policies, and bad policies are not an accident. Good govern
ment is not to be had for the asking. It took Europe centuries to get
it, so why should Africa do so in mere decades, especially after the dis
tortions of colonialism? And how about no government? At the mo
ment, for example, Somalia is a political vacuum: even if one wants to
send help, what address to send it to? "We don't even know how to
send them a message."^29
In a fragile world, good policies are hostages to fortune. In Africa,
as in much of the world only more so, the clocks go backward as well
as forward.
Country Interrupted: Algeria
One of the most chastening exercises in economic history is to recall
the expert prognoses of yesterday and appreciate their vacuity.
In the euphoria of the 1970s, when Algeria was raking in abruptiy
inflated oil revenues and, after South Africa, had the largest industrial
base on the continent, a happy minister of industry predicted that
Algeria would be "Africa's first, and the world's second, Japan."
From his mouth to God's ear. Plant and equipment may not mean
output, and output may not mean utility and salability. Like other
developing nations before it, including those in nineteenth-century
Europe, Algeria set about creating a modern industrial
infrastructure. Like some of them, it aimed especially to promote
heavy industry, the more so as good socialist doctrine saw that as the
only way to go. Comparative advantage (a bourgeois-capitalist
doctrine) be damned.
All of this cosdy, state-owned apparatus featured overemployment,
inefficiency, nonmarket prices, and cooked books. Just about none