Kenyan Constitution and the Rule of Law

Most people that I have talked to expect the new Kenyan constitution to pass in the upcoming August referendum in spite of opposition from several church groups and politicians. This is also the view of the US-based consultancy STRATFOR in a new report on Kenya. The Synovate poll taken in late April showed a heavy balance in favor of a “Yes” vote, including among those who had disagreements with some specific points in the draft.

Looking ahead, the question may become, how much will the changes in the law really matter?

The Brookings Institution published an interesting study by Daniel Kaufmann  earlier this year criticizing the tendency to focus too much on the de jure rules of law rather than the de facto workings experienced in practice, citing the current situations in Kenya and the U.S. as examples:

First, consider Kenya in 2007. The main aid donors, led by the World Bank and the United Kingdom’s aid agency, DfID, tended to praise the governance reform efforts of the Kenyan authorities, including those on legal initiatives and anti-corruption.[1] Subsequently, in the run-up to the presidential elections, these top donors, also including the United States, flooded the Kenyan government with funds. Kenya’s government was even awarded a special international prize recognizing its good governance efforts.[2]

Elections were held a few short days after the last 2007 World Bank press release in Kenya, which announced approval of funding yet another project for the government.[3] The elections were widely regarded by external organizations, such as the EU, and by many Kenyans[4] as rigged, in what was the culmination of years of systemic political corruption that infiltrated key legal and judicial institutions. Civil strife erupted and the full extent of the breakdown of law and order was exposed at a dire cost—thousands of lives were lost and vast socio-economic damages were inflicted.[5] Yet, the main aid donors appeared to be shocked that such corruption, electoral mismanagement, and turmoil could take place in Kenya.[6]

Around the same time and half the globe away, some rule-of-law institutions were being quietly undermined inside the world’s superpower: the United States. In April 2004, amidst euphoric financial sector growth, a meeting was held in the basement of the Securities and Exchange Commission (SEC).[7] The top executives of the main Wall Street investment banks gathered to weigh in on proposed SEC regulations that would relax restrictions on their investment houses.[8] A scant 55 minutes later, the investment bankers emerged with SEC approval; the new regulations exempted the investment groups from the leverage restrictions that apply to commercial banks, allowing the banks to massively expand their debt.[9]

In return for the green light to an enormous expansion of indebtedness, the investment banks agreed that the SEC would have more oversight over them, for which a special unit would be formed.[10] In practice, the oversight did not take place. In fact, the head of the SEC never created or staffed any such oversight unit.[11] The resulting financial debacle that followed is now well known. What is insufficiently appreciated is the fact that various manifestations of “soft” and “hard” forms of regulatory and legal capture by the elite financials were a factor leading to the crisis.[12]

There are many salutary features in the draft constitution, on paper, but the real question will be making them work in practice. Rule of law will crucially depend on reform of the police, consistently rated as among Kenya’s most corrupt institutions, as well as better access and more effectiveness in the court system.

The outstanding issue of prosecutions for post-election violence is a good immediate test. ICC prosecutor Luis Moreno-Ocampo is in Kenya now, and is said to have informed the government that he will seek to bring two cases against three key individuals each, in the Hague in the September-October timeframe. The government continues to pledge cooperation, but continues not to take specific steps to effectuate the law passed by Parliament to provide for witness protection.