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Tales of State Capture: Goldenberg, Anglo Leasing, and Eurobond

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WACHIRA MAINA examines three major corruption scandals during the Moi, Kibaki and Kenyatta eras that demonstrate how state capture facilitates the massive looting of public funds, and allows the culprits to get away scot-free.

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Tales of State Capture: Goldenberg, Anglo Leasing, and Eurobond
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Corruption and politics, never the twain shall part

Politics and corruption have always been intimates in Kenya since independence. Little wonder that the first commission of inquiry appointed after independence, the 1965 Chanan Singh Maize Commission of Inquiry, was triggered by a corruption scandal involving Paul Ngei, the then Minister for Marketing and Cooperatives.

Mr Ngei had permitted his wife Emma Ngei, through her company Uhuru Millers of Kangundo (commonly referred to at the time as Emma Stores) to directly buy maize from farmers, bypassing the Maize Marketing Board, which he chaired. This was despite the fact that the law did not allow Kenyans to buy maize straight from farmers (which was cheaper than buying from the government). Worse still, Ms Ngei was permitted to buy 2,000 bags of maize, but she refused to pay for them; she wrote “return to sender” on payment demands. In addition, she refused to remit the difference between the farmers’ price and the government price to the Board, which was also against the law.

Widespread speculation in maize by well-connected individuals, coupled with the government’s failure to import more maize in time, eventually led to a national shortage. The Chanan Singh commission of inquiry was appointed by President Jomo Kenyatta to investigate the cause of the maize shortage. Because of his relationship with Uhuru Millers, Mr Ngei was briefly suspended from the cabinet but was later reinstated.

Maize, then, before and since has had a long career in both politics and corruption. That first scandal set the tone for future graft: the politically connected rigging the system to benefit themselves, their relatives and their cronies and when unmasked, resorting to inconclusive methods of investigation, such as commissions of inquiry, task forces or inept prosecutions. The difference between that early corruption and the corruption described here as state capture is that most of it involved abuse of discretion and conformed closely to Robert Klitgaard’s definition: Corruption = Monopoly + Discretion – Accountability

The first corruption scandal encompassing major characteristics of state capture was the Turkwel Gorge hydroelectric power project between 1986 and 1991. Many aspects of the process of contracting for this project entailed rigging and repurposing legal processes for the benefit of President Daniel arap Moi and his cronies. According to an internal European Commission Memorandum of March 1986 written by Achim Kratz, the then Commission’s delegate to Kenya, the contract price for the project was more than double the amount Kenya’s government would have paid under a competitive international tender. The memo stated that the government knew that the price of the French contractor Spie Batignolles was extortionate, but hired them nevertheless, “because of high personal advantages”. Those “personal advantages” were millions of dollars paid to President Daniel Arap Moi and to the then Minister of Energy, Nicholas Biwott. Moreover, companies associated with people close to Moi and Moi’s family were sub-contracted to execute many elements of the Spie Batignolles contract.

The first corruption scandal encompassing major characteristics of state capture was the Turkwel Gorge hydroelectric power project between 1986 and 1991. Many aspects of the process of contracting for this project entailed rigging and repurposing legal processes for the benefit of President Daniel arap Moi and his cronies.

The effect of the combination of personal interest and inattention to geological and hydrological factors was that when the project was finally commissioned by President Moi in October 1993, the reservoir was under 25 per cent full and the project had already consumed three times the estimated cost. The knock-on effect was probably even greater: the Turkwel corruption provoked donors to cut funding to the energy sector, which would eventually generate the crippling power outages of the mid-1990s to the early 2000s.

Some of the lessons learnt from the Turkwel Gorge saga on repurposing state institutions and lawful processes to extract regime and personal gain would be applied with a vengeance to the first unambiguous case of state capture: the Goldenberg scandal.

Goldenberg: Designing the methods of state capture

In 1991 and 1992 Kenya underwent a foreign exchange crunch. The proximate cause for this was mounting pro-democracy pressure by the opposition and civil society groups, to which the government responded with violent crackdowns. Political repression and donor concern about corruption, combined with poor export performance of the leading foreign exchange earners of coffee, tea and tourism, led to a significant drop in hard currency reserves.

The government responded to this with an export promotion scheme in which exporters who deposited their hard currency earnings would not only receive the Kenya shilling equivalent of their deposits, but also an additional 20 percent “export incentive”. Goldenberg International, a company jointly owned by Kamlesh Pattni and the then director of the special branch (Kenya’s secret service), James Kanyotu, concocted a scheme to export gold and diamonds to three companies in Dubai and Switzerland on an understanding that they would be paid 35 per cent “export compensation”. The problem with this arrangement was that gold and diamonds were not covered in the Export Compensation Act and the “incentive” paid to the company was 15 per cent above the lawful limit.

The real scandal, though, was that Kenya had no diamonds and its gold mining was insignificant. In the beginning, Goldenberg International exports turned out to be entirely made up of gold smuggled from the Democratic Republic of the Congo (formerly Zaire). Later, the company stopped smuggling gold altogether and merely completed export declaration forms, produced fake hard currency deposit slips and got paid, not only the coupon amount on the fake deposit slips, but also the 35 per cent export compensation.

The total cost of the scandal is unknown, but some estimates indicate that up to 10 per cent of Kenya’s GDP was lost. The 2006 Bosire Commission of Inquiry into the scandal concluded that up to Sh158.3 billion of Goldenberg money was transacted with 487 companies and individuals. This is probably a gross underestimate, as in fact Goldenberg was a series of inter-connected financial scandals rather than the phantom exports of gold and diamonds that most investigations have focused on since 1992. (The scandal was first revealed in the Controller and Auditor General’s reports for 1991 and 1992.) According to various affidavits sworn by the main suspect in Goldenberg and associated scandals, the beneficiaries of these dealings included the President, the Vice President and his business associates.

Notwithstanding revelations in the Controller’s and Auditor General’s reports, together with whistleblower accounts covered in the media, the government initially stonewalled. This prompted the Law Society of Kenya (LSK) to seek the permission of the High Court to file a private prosecution to remedy the inaction of the Attorney General (AG).

The AG, Amos Wako, suddenly bestirred himself, asking to join the LSK case as a friend of the court. He promptly opposed the LSK’s application, arguing that he had been delayed by investigation reports, and requested the LSK to hand him such evidence as they had so that he may act. Backed by an affidavit by Japhet Masya, the Clerk to the National Assembly, the AG also argued that the High Court had no jurisdiction on Goldenberg given that the issue was before a committee of Parliament.

The total cost of the scandal is unknown, but some estimates indicate that up to 10 per cent of Kenya’s GDP was lost. The 2006 Bosire Commission of Inquiry into the scandal concluded that up to Sh158.3 billion of Goldenberg money was transacted with 487 companies and individuals.

Mr Wako’s pleas were both inexplicable and disingenuous: Parliament has no criminal jurisdiction and any policy issue on Goldenberg pending before one of its committees can have no effect on an indictment for corruption. The AG sounded more like a defence attorney than the head of public prosecutions and guardian of public interest that he was.

Dr Willy Mutunga, then the chair of the LSK, feared that Mr Wako’s ruse was proof that the government was “determined to complete the Goldenberg cover-up”. Mr Wako, he predicted, would continue to act like “counsel for all the accused persons” and would engineer “protracted delays”, “mention after mention, adjournment followed by adjournment”, ending in a “dramatic withdrawal of the cases”.

So it proved. The magistrate, Uniter Kidullah, appointed the Director of Public Prosecutions (DPP) after her decision in this case, rendered a rude and intemperate judgment, combining otiose proceduralism with personalised insults against the LSK: Mr Mutunga’s pleadings were inadmissible because he, rather than the secretary, had signed them; the LSK had no legal standing to file a private prosecution since it could not show how its interests had been harmed by the Goldenberg scandal and, so far as she could see, the LSK had acted outside its statutory mandate. Finally, she concluded that the only knowledge LSK seemed to have was that of “stealing from . . . clients”.

There the Goldenberg scandal would have died but for the government’s continuing hard currency crisis. The International Monetary Fund (IMF) and the World Bank warned Kenya that no new programme would be agreed with the country until the government took credible action on corruption in general and on Goldenberg in particular. It was this threat that spurred Attorney General Amos Wako to indict Pattni and his co-accused in 1997, five years after the scandal first broke.

But the charge was not meant to result in effective prosecution. Against the advice of his DPP, Bernard Chunga, the AG framed more than 90 counts in one charge in the face of clear precedent that so many counts would invalidate the charges. Knowing this, in July 1997, Kamlesh Pattni challenged the charges as illegal and was granted an order of prohibition by the High Court, stopping the trial. Donors, aghast at this turn of events, refused to lift the conditions they had imposed on aid to Kenya until Goldenberg was properly prosecuted.

A chastened AG filed new charges in August 1997, calculated to be good optics for an IMF mission that was expected in Nairobi in early 1998. In the meantime, Mr Pattni had concocted a new fraud to defeat any fresh charges that the AG might bring against him. Using forged papers, fake sale agreements backdated to 1992 with the connivance of the Registrar of Companies (in the Attorney General’s Chambers) Mr Pattni purported to be the owner of World Duty Free (WDF), the Isle of Man company to which he claimed to have sold the gold and diamonds. He then obtained court orders allowing him to take over management of WDF shops in Kenya.

The point of this devious scheme was that in a future prosecution Pattni could argue that as the owner of WDF he couldn’t be forced to testify against himself. Armed with this new civil suit, he challenged the fresh indictments, claiming these charges should be stopped as they were prejudicial to the WDF civil case. The court agreed with this risible claim, even though legal principle works the other way: where a criminal case raises the same issues as a civil case, the criminal case is heard first. There are two reasons for this: one, the public interest should be vindicated before the private interest and, two, given that the standard of proof in criminal cases – beyond reasonable doubt – is much higher than the standard in civil cases – on the balance of probabilities – it is more efficient to hear the criminal case first, since facts proved need not be proved again in the related civil case. This botched 1998 prosecution was the last action that the Moi government took to resolve the Goldenberg scandal.

In 2003, Mwai Kibaki succeeded Daniel arap Moi. He quickly set up a commission of inquiry into the Goldenberg scandal, ironically at just about the same time that his own cronies were busy siphoning monies out of Kenya under the Anglo Leasing scandal. The commission was chaired by Justice Samuel Bosire, who would later be declared as unfit to be a judge during the vetting of magistrates and judges mandated by the 2010 Constitution.

The point of this devious scheme was that in a future prosecution Pattni could argue that as the owner of WDF he couldn’t be forced to testify against himself. Armed with this new civil suit, he challenged the fresh indictments, claiming these charges should be stopped as they were prejudicial to the WDF civil case.

The Bosire Inquiry established what everyone always knew but could not prove, because the AG, Amos Wako, had developed feet of clay. Goldenberg, the commission concluded, involved the highest levels of President Moi’s government and Moi had personally authorised two Goldenberg-related payments. After the inquiry, the government imposed travel bans on people named by the commission as connected to Goldenberg. Bosire also recommended that retired President Moi’s role in Goldenberg be investigated. Nothing came of either the travel ban or the Moi investigation. In August 2006, the credibility of the report was seriously dented when Professor George Saitoti (formerly Vice President to Moi), who the commission had found culpable enough to warrant an indictment, got a court order expunging his name from that list of shame.

In the end, no one was ever convicted for any of the Goldenberg crimes. In 2006, six months after the release of the Goldenberg Report, David Munyakei – the man who first blew the whistle on the scandal only to be hounded into destitution for his efforts – died, a lonely and forgotten victim of the forces of state capture.

The Anglo Leasing Scandal

The Goldenberg script would be reprised in the second state capture case, the biggest scandal of the Kibaki era – the 2003 Anglo Leasing scandal. Anglo Leasing was a series of security-related scandals involving 18 state security contracts, collectively worth about $770 million (Sh55 billion), in which the government entered finance lease and suppliers’ credit agreements to pay for forensic facilities, security equipment and support services for Kenya Prisons, the Police Airwing, the police force, the Directorate of Criminal Investigations, the Administration Police, the National Security Intelligence Service (NSIS), and the National Counter-Terrorism Centre. Thirteen of the eighteen contracts were made under President Daniel arap Moi, the other five after 2002 under President Mwai Kibaki. The true identities and whereabouts of the companies remained unclear. Though the immediate investigation that blew open the scandal involved the Anglo Leasing and Finance Company, in truth the scandal involved many more companies owned by the same set of individuals: Deepak Kamani; Anura Perera; Amin Juma; Merlyn Kettering and Ludmilla Katuschenko.

Within these 18 generally irregular contracts, individual contracts were even more blatantly so: the contract for tamper-proof passports granted to Anglo Leasing and Finance Company was described by the Public Accounts Committee (PAC) – ironically chaired by Uhuru Kenyatta – as “an organised, systematic and fraudulent scheme designed to fleece the government through the so-called special purpose finance vehicles for purported security contracts”. How exactly Anglo Leasing became involved in these security contracts is unclear from the records, but the pattern itself is clear.

In 2000, the Department of Immigration did a “computer needs assessment” that concluded that to eliminate fraud, forgery, inefficiencies and revenue loss it would need to procure a passport -issuing system. This was to be done by restricted tender. The Ministerial Tender Committee invited five international firms to submit bids: two British firms, De La Rue Identity Systems and AIT International PLC; South Africa’s Face Technologies; Setec OY of Finland and Johannes Enschede of the Netherlands. Three firms responded. The decision was that AIT International PLC met both the commercial and technical specifications for the award.

However, the ministry’s budget for the 2000/2001 financial year did not cover the Sh622,039,944 contractual sum that AIT International PLC gave as the cost of the system. The procurement was deferred to 2002/2003. Six international firms were now invited to bid, the initial five and GET Group of the USA. Once again, three responded: De La Rue Identity Systems; South Africa’s Face Technologies and GET Group. The previously successful group, AIT International PLC, did not submit a bid.

A technical committee of the Government Information Technology Services concluded that none of the bids were responsive and subsequently recommended that they not only be disqualified but also that, “the system be redesigned and expanded to cover other aspects of the work of the Immigration Department, such as border controls and immigration monitoring”. It was now agreed that the expanded system would have five components: 1) high security new generation passports; 2) a secure passport issuing system; 3) high security new generation visas; 4) a high security visa-issuing system; and 5) computerisation of machine-readable immigration records. One consequence of expanding the system was a spiking of costs, which would require the Treasury to seek donor funds.

That is how matters stood when on 1 August 2003, a firm named Anglo Leasing and Finance Ltd of Alpha House, 100 Upper Parliament Street, Liverpool L19 AA, UK, sent an unsolicited technical proposal to the permanent secretary (PS) in the Vice President’s Office to supply and install an “Immigration Security and Document Control System, (ISDCS)”. The installation would be done by a sub-contractor of Anglo Leasing, François-Charles Oberthur Fiduciaire SA of Paris, France. To ease the funding problem, Anglo Leasing would offer a facility of €31,890,000 (Sh2.67 billion) to be repaid at an interest of 5% (later 4%) over a 62-month period.

On review, the PAC thought this highly irregular: a financing firm had prepared a detailed proposal for a project very similar to the one recommended by the Government Information Technology Services without a request from the government and, most curiously, in a manner that strongly suggested that the firm “had fore-knowledge of the recommendation to enhance and expand the system”.

Nonetheless, a month later, on 5 September 2003, the Vice President’s Office asked the Treasury to contract Anglo Leasing. That permission came through on 25 November 2003. Also on 5 September, the Vice President’s Office sought legal clearance from the AG’s Chambers, and in a letter dated 18 September 2003, the AG advised the ministry to do due diligence. For example, how many projects of this magnitude had Anglo Leasing successfully undertaken? What was the firm’s credit rating? The PAC did not see any evidence that tests had been undertaken or that the ministry had assessed the “authenticity, capacity, experience and track record of François-Charles Oberthur Fiduciaire”.

On review, the PAC thought this highly irregular: a financing firm had prepared a detailed proposal for a project very similar to the one recommended by the Government Information Technology Services without a request from the government and, most curiously, in a manner that strongly suggested that the firm “had fore-knowledge of the recommendation to enhance and expand the system”.

Even with all these things still outstanding, the government signed the Suppliers Services and Financing Credit Agreement for the ISDCS on 4 December 2003, and two months later, on 4 February 2004, a sum of Sh91,678,169.25 (described variously as “arrangement”, “commitment” and “administration” fees) was paid out to Anglo Leasing.

According to John Githongo’s dossier to the President, all the Anglo Leasing-type shell companies were probably established by one Pritpal Singh Thethy, an accountant and engineer who was associated with Anura Perera. These companies routinely won large contracts to supply goods and services at inflated prices to the security services and were notorious for paying generous kickbacks.

The unravelling of Anglo Leasing began when Maoka Maore, the MP for Ntonyiri, tabled documents in Parliament in April 2004, showing that Anglo Leasing and Finance Company Limited had been paid a Sh91 million commitment fee, amounting to 3 per cent of a Sh2.7 billion contract to produce the tamper-proof passports. The Department of Governance and Ethics, headed by John Githongo, tried to get to the bottom of the affair.

In that same month, whilst on a visit to the United Kingdom he asked Kroll Associates to do some due diligence on Anglo Leasing and discovered that no such company existed. Githongo had begun to suspect that very senior officials in the Kibaki administration were involved. Early suspects included Vice President Moody Awori, Minister for Justice and Constitutional Affairs Kiraitu Murungi, Minister for Finance David Mwiraria, Minister for Internal Security Chris Murungaru, Home Affairs Permanent Secretary Sylvester Mwaliko, Finance Permanent Secretary Joseph Magari, Internal Security Permanent Secretary David Mwangi, Alfred Getonga, Deepak Kamani and Jimmy Wanjigi.

From an early stage in a series of private meetings, the Vice President, as well as the ministers for justice and finance, assiduously tried to stop the investigation, partly based on the theory that “the Vice President had already given a parliamentary statement”. The scale of Anglo Leasing and the depth of its penetration into the inner sanctum of power would become much clearer over the next few months. It turned out that even as investigations kicked off, additional payments and commitment fees were being processed.

When these stories hit the media, the then Secretary to the Cabinet, Francis Muthaura, said that Anglo Leasing had contacted him and promised to repay the monies they had already received. Shortly thereafter, on 14 May 2004, Anglo Leasing and Finance Ltd wired back €956,700 from Schroder & Co Bank AG in Zurich.

Investigations would reveal even more dirt. By early June, inquiries had established that Anglo Leasing had been paid $5 million for a forensic laboratories contract for which they had done no work. The brains behind the revival of this Moi-era contract were Deepak Kamani, Jimmy Wanjigi, Chris Murungaru, Dave Mwangi, Alfred Getonga, and C. Oyula, the Financial Secretary. It was clear that there were many more Anglo Leasing type contracts, and eventually 16 of them would become public.

From an early stage in a series of private meetings, the Vice President, as well as the ministers for justice and finance, assiduously tried to stop the investigation, partly based on the theory that “the Vice President had already given a parliamentary statement”. The scale of Anglo Leasing and the depth of its penetration into the inner sanctum of power would become much clearer over the next few months.

The case of two of these Anglo Leasing-type companies – Sound Day Corporation and Apex Finance Corporation – closely followed the conspiratorial modus operandi of the contracts for the tamper-proof passports. The two companies, which were managed by Brian Mills, a US national, had signed four contracts, cumulatively worth more than $145 million. According to newspaper accounts, the three Kamanis – Chamanlal Kamani, Deepak Kamani and Rashmi Kamani – became directors of Sound Day in April 1990. Sound Day, like other Anglo Leasing companies, was to provide credit, as well as supply the equipment to be financed through that credit. However, the contract terms were that the equipment would not be supplied until the government paid the first instalment. Sound Day provided no credit, but charged 3 per cent interest on this “financing” whilst, in fact, the financing was the money that had been advanced by the Kenyan government in the first place. This Byzantine arrangement was later described in court as a “classic case of reverse financing”.

As Anglo Leasing unravelled, the attempts to stop investigations became both frantic and menacing. The Minister for Finance, David Mwiraria, indicated that he would not lay before Parliament a damning special audit report compiled by the Controller and Auditor-General until the Treasury had made some “major changes”. The Minister for Justice, Kiraitu Murungi, weighed in with the caution that Mr Githongo should be careful not to “knock out key political people” like Alfie (Alfred Gitonga) and Murungaru given that both were “key players at the very heart of government”. He would later add that, “if Chris [Murungaru] is dropped and Alfie [Gitonga] is dropped we are in trouble, the enemy will have won”. According to him, people were concerned that John Githongo “did not appreciate the political costs of his work”.

A different politician was later to emphasise these warnings, saying that if Githongo’s investigations threatened the “stability of the regime” then the President would stop backing him. Both Mwiraria and Kiraitu said that they hoped that the investigations would stop as soon as Anglo Leasing repaid the money. Over time, the cover-up efforts would turn bizarre: Francis Muthaura even questioned the legal authority of the Kenya Anti-Corruption Commission (KACC) to conduct the investigation and implied that the Anti-Corruption and Economic Crimes Act was not reasonable legislation, ostensibly because of the broad powers it gave to the KACC.

What the pressure on Githongo and the repayment of the money on the publicly known contracts revealed was a clever ploy to head off investigators from the other numerous yet to be known contracts by issuing a mea culpa on what was then publicly known.

One issue surrounding the scandal is what President Kibaki knew and when he knew it. For instance, on the forensic labs contract, the Secretary to the Cabinet had indicated to Githongo that he had briefed the President on this contract, but when Githongo met the President on 29 May 2004 Kibaki said that no one had briefed him and asked to be furnished with a copy of the contract. Two days later, Muthaura would insist that the President had been fully briefed and that it had been agreed that all payments were to be stopped and that the authorities must establish who Anglo Leasing were.

Later still, Mwiraria would claim that the President had requested that they “go easy” on Anglo Leasing given that the money had now been returned. Mwiraria and Kiraitu would argue that if the public were to know that there were other corrupt deals of this magnitude, “our government would fall”. Had the President in fact said this or were Mwiraria and Kiraitu using the authority of the Presidency to smother inquiries? Had the President lied when he told Githongo that he had not been briefed?

From the determined opposition to his inquiries, the lukewarm support he received from the President and the threatening messages that he received throughout this early phase of the investigation, Githongo feared for his life and went into self-imposed exile in the United Kingdom in 2005. His conclusion was that the Anglo Leasing scandal went all the way to the top and that its baseline was a scheme to finance the 2007 election.

One issue surrounding the scandal is what President Kibaki knew and when he knew it. For instance, on the forensic labs contract, the Secretary to the Cabinet had indicated to Githongo that he had briefed the President on this contract, but when Githongo met the President on 29 May 2004 Kibaki said that no one had briefed him and asked to be furnished with a copy of the contract.

In November 2005, President Mwai Kibaki finally acted. He dropped Chris Murungaru from the Cabinet. On 1 February, he dropped David Mwiraria and a fortnight later he had “accepted” Kiraitu Murungi’s resignation. Although 80 MPs demanded that the President fire his Vice President, Moody Awori, the President demurred. As with Goldenberg, the government imposed the usual travel bans on the principals and announced that it would also freeze their assets. Whether this happened or not is unclear; there is no official indication that it did.

In 2007, the UK’s Serious Fraud Office tried to get to the bottom of a $30 million transfer made by Apex Finance, one of the Anglo Leasing companies, between April 2002 and February 2004 through the Channel Island tax havens of Jersey and Guernsey. But by 2009 this effort had petered out, partly due to obstruction by Kenya. That same year, authorities in Switzerland launched investigations into Swiss companies named in the scam and froze their bank accounts. It, too, came to naught. By the time President Kibaki had served out his two terms in 2013, no action had been taken on Anglo Leasing.

The next time Anglo Leasing would be in the news was in early 2014, ahead of the country’s debut launch of a $2 billion sovereign bond, half of which would disappear into thin air in the biggest scandal of the Uhuru Kenyatta presidency. The facts were as follows. Kenya had lost a lawsuit in Geneva filed by two Anglo Leasing companies linked to Anura Perera – First Mercantile Securities Corporation and Universal Satspace. (Perera was one of the suspects named in the 2006 special audit of Anglo Leasing.) It then turned out that the country had to pay Sh1.4 billion to improve its credibility with international markets by clearing its (ostensible) debts in preparation for the launch of its debut in the foreign sovereign bond market, the Eurobond.

This was odd for two reasons. First, there was also a contrary judgment from the High Court in Kenya. Justice Mathew Anyara Emukule had ruled in 2012 that the two companies were non-existent entities that could not sue. Second, the government had claimed that the contract was vitiated by bribery and there was a PricewaterhouseCoopers (PWC) audit showing that the goods were over-priced and some had never been delivered, even though payments had been made. The Geneva court rejected these PWC findings.

As a matter of Kenyan law, the government had paid this large sum to non-existent parties. According to Treasury Cabinet Secretary Henry Rotich, it was necessary to pay out this amount lest the country suffer huge interest penalties. The Deputy Solicitor General, Muthoni Kimani, buttressed the Treasury’s argument with the claim that the Anura Perera litigation in Switzerland had adversely affected the issuing of the sovereign bond. Hot on the heels of this payment, National Treasury Permanent Secretary Kamau Thugge told the Public Accounts Committee that Mr Perera was now demanding an additional Sh3.05 billion for services given to the National Security Intelligence Service, now known as the NIS. (According to Thugge, Perera’s new demand related to another project, Flagstaff National Counter Terrorism Centre,that the government had contracted in 2004 at a cost of $41,800,000.)

A payment of $16.4 million to Deepak Kamani in 2014, also purportedly to facilitate the launch of the Eurobond, seems to have triggered the government’s interest in prosecuting the Anglo Leasing principals. In March 2015, 11 years after the scandal broke, 13 people connected to Anglo Leasing, including businessman Deepak Kamani and former minister Chris Obure, now a senator, were indicted.

The prosecution might be explained by President Kenyatta’s fury at the $16.4 million (Sh1.6 billion) Kamani payment and the extra Sh3.05 billion being demanded by Perera. In addition, some pressure seems to have come from Switzerland. Jacques Pitteloud, the Swiss ambassador to Kenya, told the Financial Times that Switzerland was tired of suffering reputational loss as a safe haven for stolen money. But the real political reason could well be that prosecuting Anglo Leasing deflected attention from scandals involving the friends and relatives of Mr Kenyatta. None of the targets of the Anglo Leasing indictments were connected to the Kenyattas.

As with Goldenberg, none of the arrests and indictments have so far led to convictions. This script of never holding to account those involved in state capture scandals would be replayed by Uhuru Kenyatta, as President, when he was himself caught up in the Eurobond scandal.

The Eurobond Scandal

Less than a year after the election of President Uhuru Kenyatta in March 2013, Kenya went to the international money markets to issue Kenya’s first sovereign bond worth $2.75 billion. This was done in two tranches. The first issue raised $2 billion (Sh176 billion at the time) and the second $815 million (Sh74 billion) for a total of $2.8 billion (Sh250 billion). The government said that the money would be used to reduce official borrowing from the domestic market, which would spur private investment by lowering interest rates.

According to an analysis by economist David Ndii, the government executed two transactions from the offshore account into which the $2 billion had been credited. It paid off a pending loan of $604 million (Sh53 billion) and then transferred $394 million (Sh35 billion) to the exchequer, leaving $1.002 billion (Sh88 billion) in that account. The government has never accounted for this money.

When inconsistencies were pointed out, the government responded with both lies and insults. The lies were that up to Sh120 billion had been used partly to pay pending bills to road contractors and for budget support. But as Ndii points out, the recurrent budget for the 2014/2015 financial year was funded by domestic revenues: the government raised Sh1.106 trillion in revenues, of which Sh229 billion was transferred to the counties. That left Sh877 billion for national government functions. The national government’s recurrent budget for that year was Sh897 billion, a mere Sh20 billion more than the revenue, reflecting no inflow of the Sh120 billion as claimed. According to this logic, the national government required only Sh20 billion more than what it had earned through revenue, so there was no way it could have used the Sh88 billion from the bond.

In its first public statement on the matter, the Treasury promised to give information on the projects that the Eurobond money had funded. It subsequently gave ministries three weeks to furnish the relevant information. Five weeks later, in an interview with Business Daily, the Cabinet Secretary for Finance lamented that “the ministries cannot differentiate whether the money they have received from the Exchequer came from VAT, income taxes, customs duties, excise taxes, domestic borrowing or the Eurobond”. This is true but irrelevant to the issue. Treasury should have been able to provide the answer. As Ndii points out, the government has a monitoring and evaluation responsibility. “For the Treasury to disburse a huge external loan, the biggest ever, without expenditure tracking seems downright irresponsible,” he commented.

In the following months, the government would “torture” the figures to show that the missing Eurobond money had indeed financed development projects. This was done by “wildly” (Ndii’s word) inflating the cost of nine projects in the energy sector that showed overruns of nearly Sh67 billion. Rural electrification of primary schools was said to have cost Sh34 billion rather than the Sh9.9 billion that had been budgeted. An unbudgeted item for the financial year, military modernisation, gobbled up another Sh62.8 billion. The point of cooking the figures, Ndii surmised, was to create a plausible storyline to explain the missing Eurobond money. “How high up does this fraud go?” he asked.

The government couldn’t – or rather wouldn’t – answer this question directly but its conduct in the coming years had the guilty air of an adulterer caught in flagrante delicto. As David Ndii explained, the government’s real problem was that it could not account for the Eurobond money that it had not spent and still manage to balance its accounts. In the 2014/15 financial year, it partially pulled off this miracle by reducing domestic borrowing for the year from Sh251 billion to Sh110 billion. The Sh140 billion reduction covered the exact amount of Eurobond money that it claimed to have carried forward from 2013/14. Unfortunately, this voodoo accounting was undone by the Central Bank accounts on domestic borrowing and was flatly contradicted by the interest that the government reported having paid on domestic borrowing for the year.

In the following months, the government would “torture” the figures to show that the missing Eurobond money had indeed financed development projects. This was done by “wildly” (Ndii’s word) inflating the cost of nine projects in the energy sector that showed overruns of nearly Sh67 billion.

In 2016 the Auditor General, Edward Ouko, tried to get to the bottom of the affair by conducting a forensic audit of Eurobond transfers from the Federal Reserve Bank of New York. As part of his preparations, he told Parliament that he had already made appointments with top US and UK financial institutions involved in the transactions. Mr Ouko promised to send forensic auditors to scrutinise transaction data at JP Morgan, the Federal Reserve Bank, City Transaction Services New York, JP Securities, Barclays Bank, ICB Standard Bank, Qatar National Bank and other banks that had handled the $2 billion Eurobond transactions.

Mr Kenyatta promptly blocked the investigation, arguing, implausibly, that by saying that “the Eurobond money was stolen and stashed in the Federal Reserve Bank of New York”, Mr Ouko was implying that the Kenyan government and the United States had colluded. “Who is stupid here?” the President scornfully asked.

In the next few years, the government became cockier and more belligerent. With the Auditor General not allowed to follow the international money trail, he was reduced to informing Parliament at the end of each audit year that “investigations into the receipts, accounting and use of funds related to the Sovereign/Eurobond are still ongoing and the accuracy of the net proceeds of Kshs 215,469,626,035.75 is yet to be ascertained”.

As Ndii’s analysis pointed out, unravelling this mystery should not have been as complicated as the Auditor General’s laconic conclusion might suggest and the Treasury’s effort to explain the mystery only compounded it, even with the IMF weighing in to support the official explanation. But as the Mozambique Eurobond story shows, the IMF has been criminally negligent in these matters.

In this case, the IMF’s attempt to aid the government was unavailing. The Fund showed that Eurobond money was received and spent in the 2013/14 financial year. But given that the Eurobond money was received in the last week of that financial year, it would not have been possible for it to be spent in that year. There was no drawdown until the first week of July, which was the start of the 2014/15 financial year. The difference between the Fund’s fiddling and the Treasury’s fiddling was that the IMF reported a domestic borrowing figure of Sh251 billion for 2014/15 domestic borrowing, whilst the Treasury showed one of Sh110 billion. As Ndii noted, “The IMF cooks the books one way, and the Treasury, the other”.

Mr Kenyatta promptly blocked the investigation, arguing, implausibly, that by saying that “the Eurobond money was stolen and stashed in the Federal Reserve Bank of New York”, Mr Ouko was implying that the Kenyan government and the United States had colluded. “Who is stupid here?” the President scornfully asked.

But the Treasury’s lies were also compounded by the mandarins’ poor memory. By 2015/2016, they seemed to have forgotten the 2014/2015 numbers. Now the Treasury reported Sh251 billion as the correct domestic borrowing figure. With Sh251 billion confirmed as the correct amount, the only way to account for the Eurobond Sh140 billion was to show the projects in which it was invested. That no such projects have been named implies that at least $1 billion of the Eurobond money has disappeared into thin air. The conclusion that it has most likely been stolen by some very senior untouchables is compelling.

With investigations never having been started, the Auditor General, beaten down by the President, and the marked lack of enthusiasm from the United States (particularly the New York Federal Reserve), it is unlikely that we will know who stole nearly $1billion of taxpayers’ money.

This is Part 3 of an abridged version of State Capture: Inside Kenya’s Inability to Fight Corruption, a report published by the Africa Centre for Open Governance (AfriCOG) in May 2019.

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Wachira Maina is a constitutional lawyer based in Nairobi, Kenya.

Politics

A Very Political Virus: Trumpism’s Ridiculous Response to COVID-19

Trumpism in the age of coronavirus may be gasoline poured onto the fire of a worldwide catastrophe in bizarre ways that are only beginning to be spelled out now, but which could have dire ramifications globally, including in East Africa.

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A Very Political Virus: Trumpism’s Ridiculous Response to COVID-19
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I can’t tell for certain, but the ambulance sirens seem to keep increasing, not with the incessant wails reported in New York, but a creeping feeling that something is on the rise.

Here, in the state of Wisconsin, on April 6th, the Democratic Governor, Tony Evers, fearing the worst in light of the COVID-19 crisis, passed an executive order to postpone the primary election, which took place on April 7th. Republicans had immediately taken the order to the state Supreme Court, and over turned it, forcing people to go to the polls.

Why? To align with Trump’s political desires. With thousands of absentee ballots already thrown out, the primary election (which includes a key state Supreme Court seat) is one that could be decisive in what is sure to be a controversial, close and unprecedented presidential election in the fall. President Donald Trump had backed the Republican candidate publicly, and called for the people of Wisconsin to turn out to vote for him, despite COVID-19.

In a state with controversial voter ID laws (which disproportionately affect people of colour), this has made a stark choice all the more vivid – come vote if you dare tempt coronavirus or stay home and be disenfranchised.

That’s where the screw really turns here: Donald Trump didn’t just learn from the example of Kenyan election farces; he studied and plagiarised them. (It makes sense that in this context, both the Kenyan ruling political elite and the Trump campaign were clients of Cambridge Analytica, the controversial firm whose use of unethical data mining tactics during elections have been exposed by the international media.)

Shown through the lens of an increasingly horrific pandemic, such election rigging is all the more grotesque. But it will soon be swept aside as another story of power grabbing, political manoeuvring over human life and bullshit grandstanding over the public good will utterly mar the last two months of the descent into the Age of the Coronavirus. An entire state just got thrown into an accelerated timeline of potentially being a horrific hotspot for the virus; the fates of potentially thousands of lives now sealed, there will be a push to promote a political agenda.

Donald Trump didn’t just learn from the example of Kenyan election farces; he studied and plagiarised them.

The political leadership of East Africa could truly stand in awe at the utter Machiavellian dumbness of this narcissistic manoeuvre – as it is truly a Stalinesque effort. The problem inherent right now in the world’s “best economy” is that politics has crept into the pandemic; the divisive nature of the discourse is such that it has spiraled downwards over the last five years. The election debacle in Wisconsin perfectly encapsulates the state of things right now in the US. In the year of a presidential election, pandemic tumult and constant political punching dominate.

All things are on equal footing, all things are intertwined, as Trump has made them to be. And as anyone with eyes or outside the administration can tell, it is going terribly. By the third week of May, the US had more than 1.5 million COVID-19 cases; of these, nearly 94,000 had died from the disease. Because the country is woefully inept at testing, more than a dozen states seem to be on the upward curve.

Where to start?

Even attempting to encapsulate the last several weeks in a sprawling critique seems to point in a million directions, so let’s focus and dissect three key aspects of the response to coronavirus in the US more in depth:

The Trump administration playing dumb while being dumber

First, Trump and his cohort have seemingly deliberately made a once distant threat of disease exponentially worse through denial, deceit, malice and twists so moronic they mystify the mind. (You can’t expect a climate denier to have the brains to handle a scientific crisis). Trump’s positions, like a fish left on the counter, grow in their stench as the days continue bloodily onward. His latest in a long string of travesties find him stumbling into the idea of injecting disinfectant into the human body to “clean it” of the virus. This latest gaffe, at least, was rooted more in idiocy than in cruelty, and was almost a welcome change towards comic relief after previous actions he’s undertaken. Even so, despite what he and the American far right-wing culture say, the fact is that the White House is listened to by the public, and so poison control cases went up across several US states after Trump made this ridiculous claim.

Trump and his cohort have seemingly deliberately made a once distant threat of disease exponentially worse through denial, deceit, malice and twists so moronic they mystify the mind.

The most important aspect to emphasise here is the outright denial that carried over for approximately six weeks (and, according to some reports that leaked memos to the White House regarding the COVID-19 threat, possibly even longer). Trump’s denial of the crisis was astounding, and to be frank, is still ongoing. Often, even in the days leading into May of 2020, the stance of the White House has been to express how things are improving, although they are clearly markedly getting worse for all to see. The optics hit the American public in the same vein as the Westgate mall terror attack crisis hit Kenya’s. (The fires in the mall couldn’t possibly be merely burning mattresses.)

Trump’s reaction to the crisis helped spur what must be statistically the worst outbreak globally. As far as optics are concerned, his reaction can only be put alongside Bolsanaro’s in Brazil and the Iranian regime’s in terms of terminal dumbness, obtuse means-spiritedness and ineptitude. It is a denial of a natural disaster that I haven’t seen at a leadership level since perhaps the 2011 drought ravaging northern Kenya; while the Kibaki administration and Kenya’s Parliament seemed largely to sit and twiddle their thumbs, occasionally making a statement expressing their condolences, they promptly went back to bitching at one another.

On a daily basis, Trump lumbers out (despite constant efforts by Republican lawmakers to stop him), shouts mixed messages to a confused press corps, then screams at them for asking what he’s talking about. The paranoia has reached levels of Daniel arap Moi in the 1980s; there are enemies within all corners, closing in, making the virus worse just to hurt him, the mounting deaths swept aside in importance so that the name of his brand not be tarnished by “haters”.

Such a tone is a tonic for no one, least of all medical staff, who, despite all outward claims made by the administration, are in dire need of absolutely everything, with no end in sight. Random people are scrambling to adjust – there are weird stories of desperation and plugging in holes wherever the government fell abysmally flat. People sew masks and stockpile if they can afford to. There is mounting concern that the hospitals are so overwhelmed that people with other conditions are going ignored or skipping vital visits.

It is simply proving to be more than anyone bargained for, even for those who officially became doctors and nurses by taking the Hippocratic Oath. As an old friend, a resident nurse at a prominent Michigan hospital, told me in early March, “We’re going to lose many doctors, nurses…people we already have a national shortage of. There are already conversations amongst healthcare providers, nurses, staff about what’s worth the risk. None of us signed up to work in unprotected conditions. It is like walking onto a battlefield without anything, anything at all needed for the specific fight.”

In the US, nurses, doctors and emergency medical technicians talk openly about going on strike, citing lack of protection – a move almost reminiscent of the series of strikes undertaken by medical workers in Kenya over employment conditions across the last several years. Even now, after months of the obvious from a multitude of voices, the Trump administration comes out and yells about its successes in the very areas that are the depths of its failure.

Think about this: over the last several weeks, Trump has ignored the virus, then fought to reopen the economy; he has blamed Democrats, yelled at the media on a daily basis, and called the virus a conspiracy to get him out of office; he has supported rebellion in several US states, encouraged primary elections to go forward and given his son-in-law (who has been cited by multiple researchers as an utter failure) a more prominent role in the COVID-19 response than any scientific expert.

All this while the high-ranking members of his party and surrounding hangers-on float ideas, such as the federal US government not owing states supplies (although states make up the US) and for states themselves to go bankrupt.

It has, for all intents and purposes, been a showing so abysmal and wrong-headed at every conceivable level that there is already talk that the last two months may have permanently crippled the GOP and will push them out of political relevance permanently as the US becomes a more diverse and younger country moving into the middle decades of the 21st century.

Trump and his administration, in their desperate flailing about in the dark for someone to blame, have made this crisis entirely about themselves and their own inherent “victimisation” – a strategy which, as deaths mount steadily and the economy finds new cliffs to dive from, looks increasingly foolhardy.

It is now growing harder to see how the current administration will get its collective act together (even though it urgently needs to do so) as the virus continues to pound the US in the coming months.

Clear cracks in the US system

Over the years, many friends have told me that they have wanted to go to the United States – to study, to work, to whatever. Universally, I’ve told them all to look elsewhere. All the flaws in the American Death Star have been highlighted by the Trump administration, including inherent societal problems, susceptibility to totalitarian blowhards, racial inequity, horrific economic disparity, capitalism’s exploitative nature, and the fundamental flaws in the US system of governance itself.

Trump and his administration, in their desperate flailing about in the dark for someone to blame, have made this crisis entirely about themselves and their own inherent “victimisation” – a strategy which, as deaths mount steadily and the economy finds new cliffs to dive from, looks increasingly foolhardy.

The last several weeks have proven the “far left types” (myself included) correct – although few of us could have imagined such a rapid descent. America, “the most powerful nation on Earth”, is inherently unequal, terminally flawed and fetishises money to a disgusting level. There are rampant stories of businesses closing, predatory loans, and debt claims coming out of life-saving stimulus money.

The very governmental system has shown itself to be labyrinthine, a truth only accelerated by capitalism, Trumpism and, let’s face it, the modern Republican Party.

Take medical care, where is an ugly Catch-22 at play. People are broke, and the American medical system is the most expensive in the world. People need healthcare and tests, but the fear of the cost often outweighs the fear of a deadly virus. The one thing that could correct the economy (testing) is avoided because of the state of the economy (both before the crisis and into it).

States compete against each other to get supplies while the government sells off its supplies to companies in order for the companies to sell them back to the government for distribution to the states. All this is happening while the government is questioning whether the states really need the supplies, and possibly favouring some states that favour Trump and his cronies politically. It is the kind of nightmarish inaction that would even make Kafka stir in his grave.

The medical system itself has been brought to its knees. Walking around a few weeks ago, I saw two ambulance crews going into houses, all wearing masks, every one of them looking well beyond their breaking points.

All this is happening while the government is questioning whether the states really need the supplies, and possibly favouring some states that favour Trump and his cronies politically. It is the kind of nightmarish inaction that would even make Kafka stir in his grave.

This, in a well-to-do city with several prominent functioning hospitals run by competent individuals. This is not the case in all US states and cities, but the most glaringly obtuse responses are coming from Republican-held legislatures.

An inherent problem in the US is that smaller states skew Republican votes, hold equal power in the Senate, and elect increasingly bigger idiots and inept climate sceptics while carving up districts to benefit their own hold on power. This has proven true in South Dakota, where the Republican Governor, resistant to social distancing, has seen an outbreak of more than 500 cases in a single pork processing plant.

It has also rung true in Florida, where Governor Ron DeSantis, himself a loyal Trumpian, resisted calls within his state to close down because the state with the high geriatric population could be hit catastrophically. Instead he waited for Trump’s go ahead, even as White House press conferences repeatedly turned into unbalanced, unhinged name-calling sessions while Trump himself denied the true impact of the virus and prematurely called for the economy to reopen. DeSantis has since given a “stay-at-home” order and ordered that World Wrestling Entertainment be continued as an essential service, alongside grocery stores, banks, hospitals, and the fire department.

It inherently means that while some states (such as California, Ohio and Washington) reacted with preemptive speed and some (like Maryland, New York and New Jersey) have risen to the challenge admirably after it began to spiral, other states may keep up the perpetual game of whack-a-mole indefinitely through their own failings.

In many of these states, particularly those with large black communities (New York, New Jersey, Michigan), the disparities have grown even more stark. It is a discrepancy in standards that can almost be compared to the lack of resources afforded to Western Kenya; there are some areas of focus, but if you’re not of a certain set, a constant less will be your systemic truth.

This has become all the more clear in the American situation. Ugly reports have seeped out about black and minority individuals being less likely to receive coronavirus testing, care or access to the same medical treatment as whites. In turn, this has led to minority and lower class communities being slammed by this virus disproportionately, sometimes at shocking rates. In hardest hit New York City, some reports show people of colour dying at double the rate of white people.

It has also shown the true insidious nature of the political divide under the Trump administration. From powerful corners on the right, there have been ideas floated to defund Democratic states for reasons that are still unclear beyond the spectrum of unbelievable political pettiness. Take Trump’s Twitter gem on April 27th: “Why should the people and taxpayers of America be bailing out poorly run states (like Illinois, as example) and cities, in all cases Democrat run and managed, when most of the other states are not looking for bailout help? I am open to discussing anything, but just asking?” The irony that states like Illinois are also American is an irony that may or may not be lost upon the Republican Party.

Economically, the capital of capitalism has shown its true colours; and they break badly along generational lines. People post long screeds about suddenly being thrown out of work, with the government arguing bitterly about any support for citizens while simultaneously sending trillions to large corporations.

There seems to be something tectonic happening, although it is yet to be seen if it will prove to be beneficial or harmful to the public good after the scourge of COVID finally recedes.

Trump sinks the world

The final key takeaway: that in this globalised world, Trumpism in the Age of Coronavirus may be gasoline poured onto the fire of a worldwide catastrophe in bizarre ways that are only beginning to be spelled out now, but which could have dire ramifications globally, including in East Africa.

The virus has already shifted from the West down and into the Southern hemisphere, with the level of consequence yet to be seen. While some credit must be given to the swift action taken in many African countries (such as closing borders and reinstating Ebola protocols), the reaction of some governments has taken on a definitively Western tint: doing what works for them while simultaneously ignoring the economic realities in their own backyards.

Economically, the capital of capitalism has shown its true colours; and they break badly along generational lines. People post long screeds about suddenly being thrown out of work, with the government arguing bitterly about any support for citizens while simultaneously sending trillions to large corporations.

China, of course, has borne the brunt of the blame, and perhaps in the long term, ensured the nation’s dominance over global influence (especially in sub-Saharan Africa, a focus of Beijing).

Given this, the failings of countries such as the US should be looked at as a warning. Where society fails to protect, advantage shall be taken, and swiftly. Just this month, the US cut off funding to the World Health Organization (WHO), a UN body where US contributions constitute approximately 20 per cent of the budget. Make no mistake about Trump and his ilk – he abandoned us Americans, and, as his recent cut in funding to WHO showed, he won’t think twice about abandoning the rest of the world too. There will be no gestures of international goodwill coming from the Trump administration, something that is leading to feelings of unease within spheres of the diplomatic community. It can be seen already, with valuable protective equipment being intercepted from going abroad; those ugly protectionist and isolationist instincts are taking over.

This move just proves that the ugliness of Trumpism is, unfortunately, not localised within US borders; there is no quarantining this administration. Such isolationism and xenophobia will get downright dangerous when (for instance) a global pandemic, a historic economic crisis and a once-in-a-century locust swarm hits the East African region simultaneously with full force in the coming months.

On top of this, the Trump administration’s policies have helped to undercut the already stretched-thin medical systems of the developing world. In Kenya, for instance, a major pillar of funding for blood donations and subsequent transfusions has already been cut. It is unlikely to be restored under a Republican White House.

In times of crisis, the failings of this White House will become starker. In the years to come, it may come to light that the mishandling of this crisis by the Trump administration accelerated the economic and health ramifications of COVID-19 and spiraled the global system further on its downward trajectory. If the West has been brought to its knees, the United States seems hell-bent on sinking itself lower, swamping the world as well.

Once the US industrial machine finds footing and produces the needed testing, masks, ventilators and medication (it will, despite the Trump administration, not because of it), the White House will surely rapidly pivot to “these must be kept to protect us”, the same shortsighted dumbness that will both kill people by the tens of thousands in the developing world, and serve to perpetuate the virus once it circulates around the global channels again, inevitably circling back into America, which, when led by such an inept head of the federal government, will be “totally unaware, because it is your fault anyway” and the cycle will continue until a vaccine is developed or Trump is finally cast out of the White House.

The latter option, while knocking on every piece of wood within reach, is becoming increasingly viable. In that same bastardisation of an election in Wisconsin – the one that was blatantly rigged and dangerous – Jill Karofsky, the Democratic candidate for the Supreme Court, landed an improbable victory, and a massive one. Winning by more than 150,000 votes and a margin of more than 10 per cent (which is much higher due to factors such as voter suppression and the throwing out of ballots) in the swing state of Wisconsin, which narrowly went for Trump in 2016, gives hope that a rational person can get back behind the wheel of the White House as early as January of next year. It may be an early indication that Trumpism has overstayed its welcome in the time of corona, and that a more sensible America may emerge again.

Even so, while there may be some glimmer of better heads coming to the table in the US, this is far from certain. The fear is that the damage to the world from a single man with bad hair may be irreparable.

This is the truest shame of the US side of this initial chapter of coronavirus: that it has truly shown the goodness of the people of the country who as individual citizens and communities have largely reacted admirably, at times even heroically, to meet the challenge head on. Their efforts couldn’t have been wasted on a worse leader. What progress they make locally gets undercut nationally.

Even so, while there may be some glimmer of better heads coming to the table in the US, this is far from certain. The fear is that the damage to the world from a single man with bad hair may be irreparable.

As Trump and his cronies continue to cast blame, ban immigrants and defund international health organisations, there may be a truly long fight ahead. It may become a situation akin to an unruly drunk desperately trying to break everything just to ruin the vibe of a party as he is forced out of the gathering.

If nothing else, this crisis proves that the American model is an utter failure. Anyone who wishes to emulate its foray into neoliberalism will wind up in a similar ruin.

And the ambulances will continue coming.

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Responding to COVID-19: Should Science Alone Determine Policy?

The advantages of governments pursuing policies that are based on scientific evidence cannot be disputed. However, listening to the science does not automatically mean shutting down society and the economy.

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Responding to COVID-19: Should Science Alone Determine Policy?
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As I was starting to write this article, the British Prime Minister, Boris Johnson, a victim of the coronavirus pandemic that is sweeping the globe, had just left the intensive care unit of a London hospital after fighting for his life. Just a few weeks earlier, he had been gleefully shaking hands at events, including one at a hospital treating coronavirus patients. That may seem, in hindsight, to be incredibly reckless behaviour on his part, which ignored the scientific advice we were all getting about the need for social distancing. Similarly, many may see the sluggish UK response to the threat posed by the virus as flying in the face of science.

However, a Reuters investigation suggests the opposite. In fact, Johnson may have been guilty of too uncritically following the advice of scientists. It suggests that when future historians look back at his handling of the crisis, “the criticism levelled at the prime minister may be that, rather than ignoring the advice of his scientific advisers, he failed to question their assumptions”.

Should we be listening to the doctors? It may seem like a foolish question to ask in the midst of a deadly global pandemic that had infected over 3 million people and killed more than 200,000 by the end of April. In such circumstances, heeding the advice of the medical establishment seems to be the most sensible thing to do.

However, as the disruption of national and global commerce and travel demonstrates, the coronavirus does not just attack individuals; it poses a threat to entire social and economic systems built around mass personal interactions, be they markets or transport systems. And though medics may be adept at safeguarding and even curing our bodies, they are perhaps less so when it comes to societies. As Kenyan economist and outspoken public intellectual, Dr David Ndii, pointed out on Twitter, “Our medical/epidemic experts seem to understand pathogens/disease spread but they don’t seem to understand people/society. And that’s a problem.”

However, this has not stopped governments around the world from rolling out the high priests of science (medical doctors and epidemiology specialists) to lend legitimacy and credibility to the measures they are taking, in some cases reluctantly, to combat the virus. It is, after all, difficult for the ordinary citizen to argue with inevitability as presented by knowledgeable people who have spent their lives drinking from the fountain of wisdom and who now come armed with charts and graphs and statistics predicting a terrifying apocalypse if we do not obey.

Yet the question still should be asked whether it is desirable that science and scientists should be dictating government policy responses. One thing to keep in mind is that despite the appeals to it, science doesn’t actually tell us what to do; rather, scientists attempt to explain the linkages between variables, to predict what might happen if we decided on a particular course of action. As Therese Raphael explains, “The world of scientific modelers looks so neat — pristine sloping lines on two-dimensional axes that tickle our love of pattern recognition and cause-effect. Only, that’s deceptive; it simply masks all the uncertainty.”

Models are simplified representations of reality, and inasmuch as scientists may recommend a particular path, this recommendation is based on their interpretation of what the science is telling them about the options they have looked at, the assumptions they have made, and the variables they have decided to consider. As Dr Mark Nanyingi, an infectious diseases epidemiologist explains, “Models can help in forecasting where and when the diseases are likely to occur and what measures are needed to slow down the spread. This can guide future government policies for better preparedness and response to pandemics.”

One thing to keep in mind is that despite the appeals to it, science doesn’t actually tell us what to do. Rather, scientists attempt to explain the linkages between variables, to predict what might happen if we decided on a particular course of action.

Further, as the saying goes, to a man with a hammer, every problem looks like a nail. So different scientists will bring their various biases to their assessment of problems. While medics may privilege the need to do whatever it takes to arrest the disease, economists, on the other hand, may point out that harming the economy could create worse problems.

Even within the medical fraternity, one might be likely to find people who think that focusing on coronavirus while ignoring other diseases that kill many more people may be a mistake. As Tom Angier of the University of St Andrews points out, “There are significant disagreements between experts even within limited domains of expertise, and these disagreements are often themselves fundamentally political.” He adds that it would be naïve to expect politically neutral results. “The rule of experts would generate not expert rule, but a cacophony of conflicting views and interests.”

Asking whether we should listen to our doctors is not about questioning their capabilities and knowledge; it is about querying the role of science and scientists in democratic governance and decision-making. Few would argue that they have no role. But it is another thing altogether to claim that theirs are the only considerations. For one, when scientists speak, it is not just the science talking; they bring with them their biases, even prejudices, as exemplified by the recent suggestion by two French doctors that a potential coronavirus vaccine should be first tried out on Africans. As Prof W. Henry Lambright notes, “When scientists leave their labs to advocate position they may be behaving much like other interest groups, trying to influence public policy.”

More importantly, technocracy (rule by unelected skilled experts) or its cousin, epistocracy (rule by the knowledgeable) may not be a good idea. As David Runciman explained two years ago in an intriguing article for the Guardian, “Even qualified economists often haven’t a clue what’s best to do. What they know is how to operate a complex system that they have been instrumental in building – so long as it behaves the way it is meant to. Technocrats are the people who understand what’s best for the machine. But keeping the machine running might be the worst thing we could do. Technocrats won’t help with that question.” Substitute medics for economists and you begin to see the conundrum.

Asking whether we should listen to our doctors is not about questioning their capabilities and knowledge; it is about querying the role of science and scientists in democratic governance and decision-making.

The British response provides a telling example. In explaining why the UK government did not join the rush to impose a lockdown, Graham Medley of the London School of Hygiene and Tropical Medicine, who chairs a group of scientists advising the government on pandemic responses, told The Atlantic’s Ed Yong: “My problem with many countries’ strategies is that they haven’t thought beyond the next month. The U.K. is different.” The country would not be panicked into taking rash measures, such as closing down schools, “in a way that feels good but isn’t necessarily evidence-based”.

Waiting for the evidence to come in before making a decision may sound like a good plan in the academy, but in the real world, decisions often need to be taken in the absence of full information, and waiting can have catastrophic consequences, as was the case in Italy.

Who decides?

So who should determine what the best course of action is? In a democracy, this function is left to elected public officials who then answer to the electorate. But are politicians any better placed to make wiser decisions? Not necessarily. However, as Runciman argues, the advantage of democracy is assuming that no one has a monopoly on wisdom; it “protects us against getting stuck with truly bad ideas”, even when these are promoted by the most knowledgeable people on the planet.

Democracy is better thought of as system for limiting the harm that governments can do than as a route to generating the best possible decisions. “Rather than thinking of democracy as the least worst form of politics, we could think of it as the best when at its worst.” And such damage limitation is undoubtedly a virtue when poor decisions – such as choosing to wait – could lead to people dying in the streets. As Prof Rupert Read writes regarding the situation in the UK, “Make no mistake, it is government policy that has led to the dire situation we are now in.”

But democracy cannot function in the absence of information and transparency about the basis on which governments are making their decisions. In the case of the UK, Yong pointed out that the models and data that had influenced the government’s initial strategy hadn’t been published, much to the chagrin of many scientists. “If your models are not ready for public scrutiny, they shouldn’t be the basis of public policy,” one scientist told him. The same could be said of other countries, including Kenya, where Dr Nanyingi has decried the government’s reluctance to publish the information on which it is basing its directives. “The disease belongs to the people but data belongs to the government,” he wryly observed.

However, as Runciman argues, the advantage of democracy is assuming that no one has a monopoly on wisdom; it “protects us against getting stuck with truly bad ideas”, even when these are promoted by the most knowledgeable people on the planet.

Obviously, science and the advice of scientists matters. The advantages of governments pursuing policies that are based on evidence and the best and most accurate information available cannot be disputed. And listening to the science does not automatically mean shutting down society and the economy, as countries like Sweden and South Korea may be proving. Requiring politicians to reveal the data underlying their decisions can inoculate against the tendency of politicians to play to the gallery, taking actions that may be popular or make them look decisive but that may have little actual utility. However, it must be emphasised that this is not the same as saying that it is the scientists who should be setting public policy.

In the end, querying the role of science is not really about the competence of modern day medicine-men, but rather the accountability of politicians and public officials. The decisions that need to be taken must consider the scenarios presented by different cadres of scientists, as well as the various uncertainties in their models. They will need to take into account not just consequences but also values and the aspirations of society. They will inevitably involve painful trade-offs and compromises.

In short, these are political, not technical, decisions and will require human beings prepared to make them and to be accountable for them. They are not abstract science.

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Betrayal in Wuhan City: Is the Love Affair Between Uhuru and the Kikuyus Over?

The economic hardship aggravated by COVID-19 and the mistreatment of Kenyans in China have re-opened old wounds among the Kikuyu, who are now questioning whether Uhuru Kenyatta was really the right choice for president.

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Betrayal in Wuhan City: Is the Love Affair Between Uhuru and the Kikuyus Over?
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Last week, my friend Njuguna called to tell me he wanted us to meet. I went to their home in Gitaru, not too far from the Nairobi-Nakuru highway and 15 km from the Nairobi city centre. The family was going to have a Skype call with their kid sister, who is now marooned in Wuhan city in Hubei Province, central China.

Six years ago, after Nyambura finished her high school studies, the family put together their resources to send her to China to study medicine, something she had always dreamed of doing. Last December, she graduated from university as a physician and even found a temporary job at a local hospital. Last November, she told her eldest brother Njuguna that she wanted to gain some experience and earn some money before coming home.

Then the coronavirus explosion happened and her life was turned topsy-turvy.

Nyambura told her family that COVID-19 was possibly detected in mid-November in Wuhan, but when it could not be kept under wraps for too long by the Chinese authorities – as they figured out how to control and manage it – the authorities were forced to report the first infection cases after Christmas 2019.

Now, talking to her family from some street corner in Wuhan city, Nyambura was sobbing on Skype, beseeching her family to save her life and not abandon her. On seeing her home and family, she broke down and wept uncontrollably. She thought of how she would have been safe and sound at home among her family, among people she would feel secure with, in her country, where she would mingle and walk freely without fear of being beaten, insulted and harassed for being a foreigner.

She asked her family to send her money for food. After the Chinese authorities went rogue on Africans about a fortnight ago, she was tossed out of her apartment and thrown out of the hospital where she was working as a registrar. She was now living on the streets; a fully trained doctor, homeless, penniless, and cowering under the brutalities of a racist regime that her government was scared of confronting.

“The unkempt kids that live and scrounge on the streets of Nairobi are 100 times better than me here in Wuhan,” said a tearful Nyambura. “They are scrounging at home in the full knowledge that nobody will beat them, they scrounge among their people and even though the street boys and girls can be rogue, the people can never disown them, or even beat them recklessly, no one would ever allow that.” In China, said Nyambura, the blacks were being treated like stray cats.

She asked her family to send her money for food. After the Chinese authorities went rogue on Africans about a fortnight ago, she was tossed out of her apartment and thrown out of the hospital where she was working as a registrar.

Describing the current situation in China, Nyambura said the country had become a nightmare for Africans, for Kenyans, for anybody with black pigmentation. But she could not believe the extent to which the Kenyan government feared the Chinese, the extent to which the Kenyan government was ready to abandon and disown its people. “At least the Nigerian embassy has registered its displeasure with the Chinese authorities, stood with its people and asked the Nigerian representatives to collect the names of all the Nigerians in Wuhan for safe evacuation. Right now to be a Kenyan in Wuhan, or indeed elsewhere in China, is akin to abandonment, to statelessness, to be entirely on your own, to have been sacrificed,” said the physician.

“Why is Sarah Serem [the Kenyan ambassador to China] lying? Why?” sobbed Nyambura to her family. “She’s been telling you that the people who have been thrown of their houses, who are being kicked around and beaten up and button-holed are illegal migrants, Kenyans who supposedly are without papers…these are outright lies. Am I illegal in China? Am I not in the streets? Don’t I have all the papers? Why is she lying to Kenyans?”

But assuming the Kenyans in China are indeed illegally here, posed Nyambura, “doesn’t an ‘illegal’ Kenyan have rights? Doesn’t she have a life worthy of being protected? Doesn’t she require representation from her government? A Kenyan in a foreign country, whether illegal or legal is a Kenyan. Civilized and thinking governments first don’t stop to ask whether their people stuck in some foreign country are illegal or legal. They move in to evacuate and protect them…they can later on, if it’s really necessary, deal with the issues of how and why they went to that county in the first place after they are finally home safe.”

Diplomats are people who are employed by their respective governments to officially lie on their behalf. “But what [Ambassador] Macharia Kamau [the Principal Secretary in the Foreign Affairs Ministry] and Serem are doing is denying our existence, calling us all manner of names, pandering to Chinese authorities’ whims. It is the worst thing a government can do to its people,” said a crying Nyambura. “To think that we have a responsible government…to believe that the government cared for its people…we’ve all along been cheated and fooled…it’s been a con-game through and through,” trailed off the physician.

The family asked her why the Chinese authorities suddenly found it fit to openly discriminate and harass the Africans. “You know when coronavirus first manifested itself, for some unexplained reason, it did not affect and infect Africans, or more correctly, black people, in China. As the Chinese were getting ravaged by the deadly disease, black people went about their business, unperturbed, apparently, oblivious of the malaise. It, therefore, seems to me, to their chagrin, the Chinese were really irked by this state of affairs. They thought, ‘Why is it that we the Chinese (who believe they are superior to the black race) are dying off, yet these blacks seems to be immune?’ they wondered.”

After the conversation, which lasted something like 45 minutes, Nyambura’s family was distraught, fraught with fear and foreboding. As is wont with many families, they bent their heads and fervently prayed for their sister and imploring the Lord God to “ring her life with the mighty blood of Jesus”.

***

The Njuguna family not only voted for Uhuru Kenyatta three times, it vigorously campaigned for him and the Jubilee Party. I know this because Njuguna and I have known each other for quite some time now. But thinking about the predicament of his youngest sister thousands of kilometres away has made him question his choices. “What kind of government do we have?” (He was not asking me, he was thinking aloud.) “What does Macharia mean when he says hiring a plane is not like hiring a matatu? When Serem disowns Kenyans in China. What’s going on in her head?”

In 2017, we had many arguments and conversations regarding that year’s presidential elections on August 8. I was sceptical about Uhuru’s re-election and he was cocksure that his fortunes, and that of his family, would rise. “How?” I kept on asking him. His response: “The Chinese are building a highway outside our village. It’s going to change our fortunes.”

Two years into President Uhuru Kenyatta’s second term, the project has not only stalled, but Njuguna does not want to hear anything to do with Uhuru or the Chinese.

When the Chinese started constructing the section on Gitaru, there was a huge uproar among Gitaru villagers. The villagers accused the Chinese of not employing any of their kith and kin. “The Chinese were doing everything, including the simplest of tasks, like dredging the tunnels, driving the trucks and even using the theodolite,” Njuguna recalled. “The local people went to complain to the local administration and the Chinese were asked to be considerate.”

“Do you know why the road has stopped?” asked Njuguna. “It is because Uhuru’s government has delayed paying the property owners their dues to allow the Chinese contractor to expand the road by building drainage that needs to build first. The people are so angry they don’t want to hear about Uhuru and his Jubilee Party government.”

“The Kikuyu people are bewitched,” mused Njuguna. “How do you explain the fact that one family has been able to control the thinking of an entire group for so long?”

I asked him whether he had been bewitched during the 2013 and 2017 elections. He said yes. “How else can I explain my total conviction in Uhuru’s presidency without wanting to brook any contrary opinion? My sister being stuck in China is the last straw that broke the camel’s back. We are through with Uhuru…”

Even I was taken aback by his brazen candour. “The Kenyatta family has been the millstone around the Kikuyu’s necks. Do you know why our people are loiterers around the country? Do you know why our people are impoverished? Because the Kenyatta family grabbed all the prime lands in the ancestral Kikuyuland. I’ve told you about our pieces of land in Naivasha and Nakuru? He has now given a Danish company huge tracts of land in Naivasha to build a beer factory,” he complained.

“The Kikuyu people are bewitched,” mused Njuguna. “How do you explain the fact that one family has been able to control the thinking of an entire group for so long?”

“I’m done with Uhuru… I’m really done with him. I regret why I voted for him, why I campaigned for him… it is a mistake I hope never to repeat again,” grumbled Njuguna. “Uhuru can find money for musicians, find money for politicians, dead and alive, but he cannot find money to evacuate Kenyans suffering in a faraway country for no fault of theirs. Once again, for the umpteenth time, President Uhuru has thrown the Kikuyus under the bus,” growled Njuguna.

In the lead-up to the 2017 presidential elections, Njuguna and I had had many heated discussions on who Kenyans should elect as president. That time he told me, “Uhuru ni gaitu ga guicirira…mukuigwa uguo…” Uhuru is ours by birth and blood…you can lump it if you don’t like it.

***

“Iguthua ndogoria, itikinyagira nyeki,” said my friend, a matatu driver to me. Translated metaphorically, it means a limping shepherd leads his flock astray. Literally it means, a leader who lacks foresight cannot lead his people to greener pastures. Essentially, he becomes a burden to his people.

My friend was in a mood to speak his mind “in these times of coronavirus, where our world has been thrown into utter confusion”. He was taking his matatu to the garage for service in Kawangware, so he asked me if I could I accompany him.

“If I didn’t take care of this matatu, regularly making sure it’s well-serviced, it’s clean, that generally it is in a good condition, would I really feed my family? Would I claim to be a right thinking human being who cares about the welfare of his people? I wouldn’t, because it would keep on breaking down, and I would lose face with my loyal customers and my business would be wobbly. That is what Uhuru’s leadership has become. I will tell you this, many Kikuyus voted for him believing that he would lead us to greener pastures, that he would care for our interests, that he would not let us suffer, that he would remember he is where he is because of the sacrifices of the people, many of them strugglers and poor.

“But look what happened? Kikuyus hitched their wagon on a fading horse, a wild horse that didn’t, in the first place, know where it was headed and how it was heading wherever it was heading. Yet we Kikuyus couldn’t stop to ask these important questions because we were consumed by ethnic jingoism. We were all in a tribally induced trance…now we’re all paying for it. I’ve thought about these things: cooked up presidential elections, tribal voting, about Uhuru, politicians, why people are suffering, and now coronavirus and I can tell you we’re living in apocalyptic times.

“I’ve listened to Uhuru in his addresses to the nation – the man lost the plot a long time ago. He is so disconnected from the people, I wonder whether he truly listens to himself. But I’m told these people [politicians] never stop playing games with us, the electorate. ‘My fellow Kenyans’…when did we become his fellow Kenyans? Do you know there are Kenyans who are starving, because they don’t have food to feed their children?”

My matatu driver friend said that in some parts of Kiambu County, where he grew up and still lives, he knows of families that have been rendered jobless. Even with their meagre incomes, at least they could afford to buy food. “Now that meagre pay is not forthcoming. How do you expect these people to survive? Still, the president talks of ‘my fellow Kenyans’. No muhaka ticiria uhoro wa muturire witu wa hau kabere.” We must seriously think of how lives will be in the future.

“For me, I already have”, said the driver. “I’ve thought long and hard and I’ve come to the conclusion that I’ll never again participate in electoral politics. What’s the point? Uhuru and his band of politicians can spend millions of shillings cheating our mothers with branded lesos [kitenge-like wrapping cloth, popular with women], caps and T-Shirts, yet he cannot find money to buy the same women masks. In his first address to the nation during these coronavirus times, the president said he had allocated so many millions to money paid to old people. That money is in the government portals – just like the stadia were built in the portals. I can tell you, the last time that money was paid to the retirees was way back, six months ago.

“The Kenyatta family runs the biggest milk production company in this part of the world, but it cannot, even for one day, say it will subsidise the price of milk so that poor people can afford it. That is the same milk they get from those poor farmers in Mt Kenya region.”

Coronavirus, said the matatu driver, had exposed President Uhuru’s administration: “It doesn’t know what it’s doing. Every time Uhuru takes to the podium to address the nation, he repeats the same things that he said the last time, hence, the speeches have become boring and repetitive. Or regurgitates what Muthai Kagwe [the Cabinet Secretary for Health] has been saying. It’s threats, warnings and blaming the youth, the poor and those who cannot afford to self-distance, quarantine, and even self-isolate, because for them it is a matter of life and death.”

“The Kenyatta family runs the biggest milk production company in this part of the world, but it cannot, even for one day, say it will subsidise the price of milk so that poor people can afford it. That is the same milk they get from those poor farmers in Mt Kenya region.”

My friend said the president had relegated everything concerning coronavirus to Mutahi. “Where is his leadership? It is missing, because I cannot see it. It looks like his spin doctors have told him to be occasionally holding press conferences to be seen to be on top of things. So he has become a talking head, talking to himself. Meanwhile, Mutahi’s major preoccupation in his numerously press conferences is to constantly frighten us with numbers, issue threats and condemn the poor and the less privileged.”

If there is one thing coronavirus ought to teach us, said my friend, is that we Kenyans need to think long and hard about the future of the country: “What do we want for ourselves? What kind of leaders do we desire? How do we right the political wrongs we’ve made? Talking specifically to my fellow Kikuyus: How do we unchain ourselves from the Kenyatta family servitude? This will be critical if the Kikuyu people in the coming years hope to be part of the struggle to liberate the country from the shackles of predatory politics.”

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