'Security' and the economy in Afghanistan

By Jack Kemp, Mar 20, 2006 : 'Security' and the economy in Afganistan

Americans may be surprised, in contrast to conventional wisdom, to learn of the comparative peacefulness of Afghan cities when compared to other big cities around the world. The coverage on cable news of blood and guts resulting from an explosion or a shooting in Afghanistan is likely to be equivalent to that of network news or front pages across the country. Most often, commentators or pundits are responding to what others have reported. The same is true of government or academe. Violence in places like Afghanistan is magnified by a giant echo chamber.

Given all that is happening, Afghanistan is completely unsafe, right? No, wrong! Not to sound like Pollyannas, but the American people need more perspective on all this, and the 24-7 TV-driven media is not helpful. If we are getting a distorted view then what is the reality? The World Bank recently published a survey where some 400 members of the business community in five major Afghan cities were asked what their greatest problems were. Electricity, access to land, access to capital, decent roads, lack of legal structures, corruption, taxes, capable labor force. "Security" did not appear on their list of concerns until No. 14 and even then it was combined with conventional crime! These people have employees and their employees have families. Surely if personal safety were threatened, these folks would feel it.

The business community fears arbitrary actions against their property by powerful ministries, stalling and corruption and government incompetence more than they do a bullet or a bomb from the Taliban or al-Qaida. So where is the disconnect, the difference between the perception and the reality?

The answer is this. The men and women of the U.S. armed forces along with coalition troops and their fellow Afghans military and police are responsible for security. They routed the Taliban and al-Qaida after Sept. 11 and now, except in certain well known areas, the enemy is confined and on the run. Sure, they can be lethal and we are taking casualties from increased attacks but the vast majority of Afghans, let's guess 95 percent, are not exposed.

Afghans have long ago discounted such risks as being small in comparison with violence they experienced over the last 25 years.

Americans need to know that the Afghan people are concerned mainly with the same things that we are. They would like a decent job, to feed, clothe and house their families, to get ahead in this world. They fear sickness, hunger, lack of a decent education for their kids. It may come as a surprise but the Taliban and al-Qaida are low on their priority list. Economic progress in their own lives, however, is not.

If the reality on the ground is something other than what we are getting in the media, and if Afghans going about their daily lives are less affected by the threat of violence than we are, and if progress in the long-term struggle is so dependent on improving the lives of the Afghan people, then the American people have a right to ask "How are we doing on the economic, job creating, prosperity-promoting front?

How are the billions of taxpayer dollars spent in rebuilding the country affecting the social and economic progress of the people?

The answer: we are doing well considering the circumstances but not near well enough. Way too much taxpayer-funded assistance doesn't go to Afghans or end up in Afghanistan. It goes to expensive, overhead-laden, money-repatriating, ultra-security conscious U.S. and foreign contractors, foreign government, U.N. agencies and high-cost non-governmental agencies.
These entities siphon off the vast percentage of aid funds to pay expenses for personnel and programs that positively dwarf what Afghans get. In Kabul, the price of housing, driven up by foreigners, rivals the prices of Washington, D.C. The foreigners sop up the best employees paying salaries unaffordable to Afghan companies or Afghan agencies.

The U.S., by far the biggest contractor for goods and services, must lead in upgrading the capacity of Afghan companies and their employees to do the job from construction to logistics to products and services of all kinds. If the Afghan companies and their workers don't have the capacity, then we need to teach, train, mentor and invest in them in order to upgrade their performance. The current system, with exceptions, is not doing that.

One exception which could serve as a model to be copied is the U.S. Army Corps of Engineers' program to require that all their contractors have mentoring and training for the purpose of getting more Afghans in on the U.S. assistance dollar. They also have a pool of smaller contracts which go only to Afghan companies.

Chinese, Turkish, Indian and Pakistani companies may get a job done but their money and skills leave when they are finished. Taxes are not paid and participation in the new democracy is non-existent.

Even better yet would be to extend credit to Afghan businesses via trust, revolving, "enterprise" or Marshall Plan types of funds and build the market economy from the bottom up for a change. Use aid to provide writing, reporting and accounting to boost borrowing capacity. By assisting Afghans directly, this venue has the benefit of sidestepping a lot of the security issues. Indeed, regional economic engagement by the U.S. via a 21st century Marshall Plan from South Asia to Iraq would be of huge benefit to the region and to U.S. business, foreign policy and security aims.

Investing U.S. tax dollars destined for Afghanistan, more in Afghans and their country, and less in foreign companies and aid providers, is the way to go. And rest assured, they will work long and hard in spite of al-Qaida, the Taliban and a media which prefers bursting bombs to building bridges.

Former congressman Don Ritter and Mahmood Karzai are co-authors on this article. They are active in the Afghan International Chamber of Commerce, the primary voice for the private sector in Afghanistan. They are also investors in numerous ongoing and developing businesses in the country.

Jack Kemp is Founder and Chairman of Kemp Partners and a contributing columnist to Townhall.com.
Copyright © 2006 Copley News Service