Magatte Wade on Africa, foreign aid, and free markets

Magatte Wade is author of the memoir and manifesto The Heart of a Cheetah: How We Have Been Lied to about African Poverty—and What That Means for Human Flourishing (Cheetah Press), in which she argues the solution to Africa’s problems lies in “the cheetah generation” of young Africans who embrace free markets, individualism, human rights, and transparency in government.

Born in Senegal and now residing in Austin, Texas, Wade is director of the Center for African Prosperity at the Atlas Network and the founder and CEO of Skin Is Skin, which sells skin and lip products sourced in Africa. In December, Reason‘s Nick Gillespie sat down with Wade to discuss her book, entrepreneurship in Africa, and startup cities.

Q: The controlling metaphor of your book is the cheetah and the cheetah generation. Where does that term come from, and what does it signify for you?

A: The reason why I am cheetah everything is because of my beloved professor, George Ayittey, a Ghanaian economist who we lost [in 2022]. He had made this differentiation between the hippo mentality. These are the people who still believe that colonialism sets us back. People who believe that slavery, even though we’re out of it, sets us back. When you put them all together, it’s more or less the victimhood mentality. Because as long as we stay in victimhood, we don’t try to fight more. We stay poor, and the foreign aid keeps on pouring in to fix, supposedly, that poverty. And then they are facing off with whom? The cheetah generation.

George said the cheetah generation is a generation of Africans with a mindset that really is waiting for no one. They’re not going to wait for the government. They’re not going to wait for foreign aid. They believe in themselves. They know they have the tools and they’re just going to get it done. And he said, the future of our continent lies on the back of the cheetahs.

It’s not about your age. It’s not about, are you African or non-African? It’s not about, are you an African living on the continent or in the diaspora? It’s very much, do you believe that we have a bright future? And do you believe that that bright future will be achieved by the free market?

Q: You critique development economist Jeffrey Sachs, who helped create and push the United Nations’ Millennium Development Goals. What do people like Jeffrey Sachs fundamentally get wrong? What is wrong with the framework that they are trying to impart on the developing world?

A: To me it’s just not understanding the way the world works and not understanding economics. It’s not really rocket science. And maybe that’s why for people who are always looking for complexity, they fail to see that. I think for folks like him, there’s something very unsettling about this idea that the market can take care of things.

Jeffrey Sachs thought he could fix poverty and so forth, but then what he did is basically set up a village, what they would call the millennium development villages. And there they just went on to basically do a very top-down type of approach to economics. Eventually what happened is they went nowhere and things started rotting all over the place. All of this stuff that they spent millions of dollars on. And by the way, an entrepreneur would’ve probably produced the same, better quality, cheaper, and still be able to sell it, but they had nothing to show for it. That’s the mentality of people like that.

Q: You say Africa would benefit from millions of Africans creating businesses, becoming entrepreneurial. But you stress how hard it is within Africa to start a business.

A: Life is made of tradeoffs. But when it comes to foreign aid, I think people only look at supposedly the little wins in the tradeoffs. I had this woman, she was very upset with me. For her, she’s sure the roads can only be helpful. Aren’t they? You see road equals benefit. Let me talk about the costs. Because of this road, I have a culture of dependency that keeps on being ingrained in my people. That surely cannot be good for the entrepreneurial mindset that we need from them in order to really create wealth and value. A cultural dependency just doesn’t go hand in hand [with economic progress].

Q: How does a road create dependence?

A: This road came because of foreign aid. Foreign aid came to us because supposedly we’re poor. Our governments are literally poor. They don’t have enough money to cater to all the needs of what the government would need money for.

Now, I would like to tell people, why do you think we are in that situation? Why do you think that we’re poor in the first place so much that we need you to inject the additional cash so that we can build the roads that normally we should have built for ourselves with the money that we made? We are poor because we don’t let our entrepreneurs work. If you just come and finance for me what I should have financed for myself and by myself and we keep doing this, nothing has changed since the end of so-called colonialism.

So for that road, I get a generation of young people behaving this way, which cannot operate in the market. For that road I also got more violence and more violence as well as leaders who never want to leave.

Q: How would startup cities help in an African context?

A: Africa is the poorest region in the world because it happens to be the most overregulated region in the world. It’s the region in the world where entrepreneurs lack what entrepreneurs need the most, which is an enabling business environment.

I’m sure your audience knows how cumbersome and complicated and hard and long it takes to do piecemeal legislation and also reforms. Costly, timely, everything. We’ve got to accelerate. And most importantly, we have to be a little bit more radical because tweaking something here, tweaking something there is just not going to get us there. We have to do tabula rasa and just start over.

So the idea instead is how about we try to clean up one place at a time? Startup cities are these next-generation special economic zones with their own law, their own governance, especially when it comes to commercial law, and usually based on common law. That’s really for me what the solution is going to be, because what you’re doing all of a sudden for these African entrepreneurs who are trapped in the dysfunctional systems they’re in right now, you’re giving them a chance.

Q: How do you get the incumbents, the people who benefit from the status quo, to allow that kind of experimentation?

A: Why I’m so bullish on the future of Africa is because we don’t need all 54 nations to go for this all at once. All I need is one nation where you have a leader who is thinking a little bit more differently than the others and also has different goals than the others because not all of them are as corrupt as we think they are. And even if they do things that are corrupt, not all of them, given a chance, want to stay in this state of misery and despair.

Startup cities are a way for these leaders to actually get their cake and eat it too. So continue doing whatever it is that you’re doing over there, but over here, let’s do an experiment that doesn’t affect [the leaders]. There is no sovereignty being attacked. Your family laws remain the same, your immigration law remains the same, criminal law, all of that stuff remains the same. You’re just saying when it comes to prosperity building, entrepreneurs need an enabling environment. So we’re going to look at the commercial laws especially and make sure we give them the best environment for them to create.

This interview has been condensed and edited for style and clarity.