Stephen Hayes is president and CEO of the Corporate Council on Africa.
Despite our penchant for drama and entertainment, combined with the media's determination to sell conflict above a deeper explanation of events, it is difficult for me to believe that we will plunge over the proverbial fiscal cliff, something we all fear, but when pressed for details really don't understand very well. I want to believe that we are relatively sane individuals who, when perched upon the precipice, will step back, and even with the hostility we have for one another, we will not push ourselves or the other over the edge into the abyss.
Still, when we look at the insanity around us, I do have to concede that I may be a bit too optimistic. Perhaps our contempt for one another and our barely disguised hatred for our differences are great enough that we do the wrong thing and take the plunge, each blaming the other as we accelerate downward, hands to one another's throat, thinking it really won't be so bad when we hit the bottom, much like the last moments of Sherlock Holmes and Moriarty.
At such times when I let my thoughts go in this direction, I wonder what will be the implications to my family, to the nation and to my work. What I see in each case is not good. My family is my concern, but the nation and our relations in the world are the concerns of all.
My work now is on Africa and the United States relationship to the countries on the continent. Specifically I believe that it is in our highest long-term interests that more U.S. companies invest in Africa. African countries, over time, will gravitate towards those countries who are investing in their future, and to whom they are bound as trading partners. There are enough significant challenges as they are without further considering the implications of leaping the fiscal cliff.
Even if we step back from the precipice, there will be cuts in the budget and there will almost certainly be less money for our efforts in Africa. Indeed, the Durbin Bill now being vetted in Congress is largely aimed at our economic engagement with Africa. Though it generally lacks funding for new ventures, the bill necessarily tries to recreate the framework and mechanisms for our work with Africa. It is badly needed. However, diving over the cliff into the void will mean far greater cuts than now planned, and the level of our engagement with Africa will be lowered.
I do not believe that increased financial aid guarantees greater success and stronger relationships. It is too facile a solution that has proven not to work blindly. I am not arguing for continuing or more aid in its traditional forms. There are a great many cuts to be made in our federal government that would not harm government's ability to serve the people. Indeed, these cuts actually might help create a bureaucracy more committed to serving the American people more efficiently and effectively. Nevertheless, the failure to come to a budget agreement that is in all our mutual interests as a nation has far more implications than simply less money for one's favorite project, country, or groups of countries. That failure damages our interests worldwide.
As it concerns my work in just one area of the economy, to engage economically in Africa, we need financing. In periods of austerity, uncertainty, and fear, which a jump over the cliff portends, U.S. banks will not be loaning money to many citizens, and are far less likely to support businesses wishing to invest in Africa. We have already seen the shrinkage of loans for the American public. Why should we think that banks would be more likely to loan for ventures in Africa, which are deemed often unfairly as 'high-risk'? Our economic engagement with Africa will shrink at a time when other nations such as China, India, the Arab states, and our traditional economic competitors of Europe are engaging Africa because all realize the enormous importance Africa represents to our economic and political futures. It is the last great untapped marketplace on a continent full of nearly unlimited opportunity. If we want a healthy economy, we need to be engaged in the international marketplace, and Africa is the that marketplace.
Africa has the potential to feed a growing and hungry planet. It is a source of some of the world's most strategic minerals, and a billion people offer U.S. citizens and businesses potential partners, investors, diverse cultural interests that no other continent can match. It is the future and we cannot afford to walk away from the future or it will not be our future to create but to follow.
Cuts are needed, but indiscriminate cuts across the board solve nothing. Such cuts avoid looking carefully at our programs and assessing together what truly is in the national interests. They eliminate a continuing debate and education of the citizenry necessary to any democracy. It is an abdication of responsibility to the world by the very people we have elected to serve our highest interests. This cannot be allowed to happen.