What the US can learn from the economic policies of Botswana

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I’m here at the World Bank Land and Poverty Conference today, sharing ideas with policy makers around the world. Yesterday, I was able to pose a question to Festus Mogae, the former president of Botswana, about the country’s high taxes on diamond rents, and the corresponding low taxes on citizens for working and exchanging. It’s no coincidence that Botswana has one of the highest GDP growth rates in the world, not just in Africa. I’m highly supportive of this policy. I did however offer criticism for Mogae over the treatment of the Basarwa aka San or Bushmen, a gross generalization for diverse indigenous groups living in Botswana and other parts of Southern Africa.

The Basarwa were removed from the Central Kalahari Game Reserve (CKGR) starting in 1997 and placed in settlements. During my travels in Botswana with the activist Keikabile Mogodu and several Peace Corps volunteers, I witnessed first hand the poor conditions of those living in these settlements, which reminded me of the squalid conditions on native American reservations here in the United States. “We stand against discrimination that is sometimes made by the State, whereby we are removed from our ancestral land … We are taken to some places where they believe we need to live,” says Mogodu.

The Basarwa have had great difficulties adjusting to their new environment. They are almost completely dependent on government welfare and alcohol abuse is rampant. This has nothing to do with the innate qualities of the Basarwa, native American tribes, Aboriginal Australians, the Irish in the 19th century, or a plethora of other groups I could mention.  When human beings are dispossessed of their rights to land, they are dispossessed of their culture, their entire way of life. Forceably trying to “civilize” native groups is arrogant, ineffective, and leads to a great deal of suffering.

The Botswanan government has stated that it wanted to integrate the Basarwa communities into “the mainstream society without any detriment to their unique culture and tradition”. How can a government take a self reliant group or nomadic hunters, force them into settlements, make them dependent on welfare, and expect to not disrupt their unique culture and tradition? It’s impossible.

The government has claimed that the Basarwa’s hunting practices have become unsustainable as a result of the introduction of new technologies such as rifles and four-wheelers, a point which Mogodu acknowledges. In truth, the primary reason for the disappearance of wildlife is sprawl, the fencing off of land past the urban and agricultural periphery. Inefficient use of space in cities like Gaborone forces agriculture and other activities out further, which in turn encroaches on land available for wildlife. Indeed, it was the hunger for land among Europeans and African groups that forced the Basarwa themselves into the arid regions of the Kalahari in the first place.

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If we are to put the Basarwa on trial for destroying wildlife, let us acknowledge and proportionately respond to the damage, orders of magnitude greater, caused by our western system of land tenure, one that encourages people to grab as much land as possible and to underuse it, speculating on the rising value. This system creates much more ecological damage than ninety five thousand Basarwa ever could. The priority should be to stem the problem of sprawl before we even begin to think about disrupting native populations.

Since the former president presumably played a key role in establishing high taxes on diamond rents, I asked what he thought about the idea of collecting land rents, i.e. a land value tax. The land value tax incentivizies landowners to only take as much land as they need, leaving more to nature. Just as diamond rents would allow the Botswanan government to tax citizens less, so too would collecting land rents. Mogae either skillfully dodged, or perhaps did not understand my question. I do however believe I made an impact on the audience, full of technocrats, humanitarians, and government advisors around the world. I did not meet a single person at the conference that did not support collecting natural resource rents, land in particular. The consensus seems to be that public awareness is what is lacking in terms of implementing  land value taxation around the world.

If Botswana eliminated taxes on regular people for working and exchanging, and replaced those taxes with a land value tax, coupling it with the existing diamond rent taxes, wildlife conservation efforts and all groups in Botswana would greatly benefit. For those that wanted to live in the cities, there would be more housing and employment opportunities. For those that wanted to live amongst nature, where the land value and thus the tax paid would be low (agricultural periphery) or non-existent (CKGR), there would be more nature to enjoy.

The same general taxation principles exist here in the United States. Most municipalities collect very little land rent. However, like Botswana, Alaska collects a great deal of revenue from natural resource rents, particularly in the form of  oil.  In many ways, the US faces the same challenge as Botswana. Should we continue to tax regular people for working and exchanging, in effect sanctioning further encroachment upon wildlife, or should we tax the value of nature?





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One Response to What the US can learn from the economic policies of Botswana

  1. Pingback: Have the experts finally figured out how to end poverty? | Work and Wealth

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