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National Realisation Point
The national debate has, for a very long time, been about where the country’s President is going to come from – south-south; north-north; west-west; east-east; south-east or south-west. This seems a genuine concern to the elites but it is of no use to the man in the street. Ninety five percent or more of Nigerians would rather debate the economy, that is, food on the table, shelter over their heads and decent clothing on their bodies. These are the basic needs of a human being. In recent times, the definition of basic needs of human beings has included good means of transportation, good means of communication, good education for the school age bracket and things that make shelter comfortable, such as television, radio, refrigeration, electricity, etc. As the S-day approaches, the debate of the colour or tongue of the next President heightens.
In
Nigeria
, as indeed in countries with similar disposition, the letter “S” that prefaces the word selection is cleverly omitted in the process of choice to give the appearance of an election. All our elections to date have been selections. In reality, we have never elected anybody in the true sense. In an election, a verdict is reached by the majority of the electorates, while in a selection it is a done deal by the whim of a small group or cabal. Polling exercises, therefore, are a waste of ordinary people’s time and resources. Nevertheless, the process creates jobs even if temporarily and furthermore, we seem to enjoy the denial. What does it matter, anyway? After all, it is about interests but because we always allow the process of selection instead of that of election, we stymie the interests of the majority. The common word for this miscarriage is known as rigging.
The audacity being displayed by this powerful group is, however, becoming worrisome. We were all living witnesses in 1998, when unabashedly, IBB spent two nights in Otta to convey his group’s message to the just-released Obasanjo that he, Obasanjo, had been selected to become the next President. To actualise the selection, a political party that was already formed was hijacked by this group. They then went ahead to legalise the process by making the rest of us queue up in a polling line, when in reality the outcome was a done deal. IBB had since sworn that he did what he blatantly did for the interest of
Nigeria
. But the audit on Obasanjo so far has created a different picture. It definitely has not served the interests of nearly 99% of Nigerians.
1. Unemployment rose.
2. Electricity supply is still sporadic.
3. Educational standard has fallen, which is understandable because their children are not in that system.
4. Data communication is still not possible, but because of technological advancement in wireless technology, we can at least talk.
5. Transportation services on our roads, rail, sea and air have been reverted to the Stone Age and etc.
It is apparent that the overriding interest of IBB’s group was and still is, staying the course. Twenty years ago, IBB took the driver’s seat, packed all Nigerians into the economic train, and chose a track that he and a few of his friends thought would take us to the land full of milk and honey.
Twenty years on, the journey has been long and tortuous with no end in sight. However, those in the First Class on the train including the drivers have managed to stash away in safe havens, goods that belong to all Nigerians, just in case. IBB’s hand chosen drivers kept powering on, on the track that seems so far to be the wrong one. Yet, the people on the train have not realised that they could be on the wrong track and nobody seems to ask if, at all, we are on the right track. Instead, we are busy debating which part of the train would produce the next driver. The reason why we should ask is because twenty years ago, our Gross Domestic Product (GDP) was $25.9 billion and today it is just $50.7 billion – this apparent increase is due only to the increased price of oil and not to productivity. Twenty years ago,
China
’s GDP was about $70 billion and currently it is $1 trillion. Twenty years ago,
South Korea
’s GDP was $19.8 billion (below ours) and currently it is over $200 billion.
Singapore
’s GDP twenty years ago was $17.2 billion and currently over $124 billion. The United Arab Emirates (UAE), with similar oil receipts, had a GDP of only $10 billion but now approaching $100 billion in GDP. Moreover, in the past twenty years, Investors have jumped out of our train to join other trains going in a different direction. The current driver (Obasanjo) spent his first term begging foreigners to come back on our train but all we got was disinvestment and forgiveness of debt. They must know something that we do not know.
The monetisation policy introduced by IBB and which our successive economic train drivers have maintained is one possible explanation. It started with the inability of the Nigerian government to service the country’s external loans at the time. The International Monetary Fund (IMF) then suggested the devaluation of the naira to allow the government at that time to earn enough money from the sale of the dollar derived from the oil revenue in order to meet its local and outside obligations. The IMF has maintained that it recommended only one fiat devaluation and not the auctioning of the Naira. Dr. Ayagi of Intercontinental Bank and Mr. Olashore of the First Bank argued in the national debate that we should accept the IMF recommendation. They were, however, relieved of their posts by IBB immediately after the debate. The Naira is the symbol of
Nigeria
’s wealth and the Naira’s auctioning created uncertainties to those who were in possession of the wealth. Investors and rich Nigerians, therefore, took their wealth out of the country in order to prevent the erosion of their wealth.
It is very clear that our GDP performed better with a fixed exchange rate to the American Dollar than when with variable exchange rates. Besides,
China
and most of the
Middle East
countries have quadrupled their GDPs in a regime of fixed exchange rates to the Dollar. It is the developed countries that are begging these economies to switch to variable exchange rates in the name of fairness because of the advantages these economies have over theirs. On the other hand, we, with our variable exchange rates are at the mercy of the West, pleading for even-handedness. The non-fixed exchange rate, in our own experience, is tantamount to the installation of a non-return valve of wealth movement to foreign soil. This, however, does not preclude the bastardly act of those that looted the economy. Taxation and Interest Rates are what we should tinker with and not the exchange rate. But those need hard work and not mediocrity. The government, however, is lazy and would rather maintain the status quo.
Nigerians definitely have not got to the National Realisation Point (NRP). The point whereby the majority would ask, ‘Wait a minute! Are we on the right road?’ Privately, many of us at one time have been in similar situation. It is said that a problem is half solved if one realises that something is wrong. Only then will the driver instinctively start applying the brakes, eventually come to a halt and make a reversal if necessary. Right now, it appears we are powering on in the wrong direction. Questioning their version of free market economy is not a willingness to return to socialism. Socialism is dead. It was killed by the same group of people it was designed to help – the Labour Union. In its place, the communal ownership of businesses through government has been replaced by public ownership of businesses – known as the stock market.
Economics is a very fascinating subject. Even renowned economists stew in their own broth. Economists have always tried to confuse the rest of us with economic jargons, yet they themselves appear not to understand what they talk about. They usually use terms like microeconomics and macroeconomics when straightforward terms that denote production (productivity) and labour (employment0 would suffice. The best amongst them still could not explain the cause of the 1930 Great Depression. Economics, therefore, is not an exact science and the closest real definition is to describe it as human psychology. This appears to be true because all of us, white, black, yellow or blue react similarly and with no variation, to the erosion of our wealth. If economics is not a precise science, we should be bold enough to question the economic track that was chosen for us, particularly after twenty years of dismal results. IBB and company, however, would rather we talk about the economic train driver and not the track itself!
Since the fall of the
Roman Empire
in 495 AD, the world had witnessed four types of economic systems. The first was the feudalist economy in which a person and his belongings were at the disposal of the sovereign, the religious leader, the military or the feudal lord. There were no wages. People were virtually slaves and remained property-less. The Industrial Revolution, however, brought the capitalist economy and for the first time, workers were paid wages. The capitalist, the man that has the means for production, dictated the wages and the production. The capitalist, however, paid little wages. He would rather not pay at all; after all, the workers’ former boss (the feudal lord) did not pay a dime. An ominous cloud, therefore, started building up between the capitalists and the workers and direct confrontation was inevitable. Consequently, two independent schools of thought emerged in
Britain
(home of Industrial Revolution) and
France
(land of peasants) to avert the impending conflicts.
This new idea was for government ownership of businesses to facilitate fair distribution of wealth. Socialism thus means business belonging to all of us and the proceeds were to be used as dividends for social benefits. The problem, however, was how to actualise the new economic theory since the governments at the time were run by capitalists. Whilst the brand developed in
France
tended towards violent overthrow of governments, those of
Britain
would be through public education. Socialism was a product from the Ivory Tower – with the likes of George Bernard Shaw in
Britain
as proponents and when later the French versions seeped into
Germany
, Karl Marx took over. Eventually, socialism would become an intellectual ferment. By the time it failed, the chief factor for its failure would be the nature of man. Man is a capitalist by nature. He does not want to share.
It took a while before the new system of socialism became popular, even in
Europe
. Not until the beginning of the twentieth century did socialism begin to gain grounds and by the 1970s it had spread to every part of the world except
America
. Even the Americans panicked and became no longer sure of their capitalist system and started implementing certain social reforms. Then suddenly, just as it was thought that socialism was unstoppable, the legs that supported the great idea started disintegrating. Socialism had failed. It had not worked properly anywhere. As stated above, workers have destroyed their own salvation. Notwithstanding, the demise of socialism did not remove the need for capital to fund businesses and the fourth economic system emerged. It is the stock market economy. It is a wonderful idea, whereby anybody in the society with the means to spare could chip in to capitalize a business and share the profits. The overriding interest of the public quoted business is profit; hence it wears a capitalist garment. Just like the capitalist, the new system would only compete with cheaper labour.
Workers did not only lose the system that provided them sanctuary, they also lost the battle to the capitalist who had fought for globalisation. It means the capitalist can move his business to anywhere labour is cheaper. The politicians also appear to have had enough of the labour unions and approved the move provided the capitalist remits its profit to his home country to be taxed. The winner, however, would be the biggest labour union in the world – the Chinese government. That union negotiated a low wage structure for its workers, thereby attracting businesses. In return, all the needs of the workers that higher wages would support would be met by the union (government) – their children’s education are free to all levels and all other aspects of living are subsidised.
China
does not even have to tax any product being manufactured in
China
. They are making enough money from power utility patronage, since the factories could not import electricity; they make money from water supply to the factories; they make money from land rentals; the labour is strictly Chinese and would have to be paid by the foreign business. The new businesses are solving the unemployment problems and above all, there is free technology transfer.
If cheap labour is a big consideration to attract investment, why then are Investors shunning
Nigeria
with its cheap highly trained workforce? It appears it is not only the cost of labour that motivates investments. It seems the greatest factor is guarantee. Investments are funded by savings in the banks and an Investor would need the savings in his home country to invest in another country. In all the countries that Investors have rushed to, to invest in recent years, capital flight is a treasonable offence punishable by death. This means the people in those countries save in their countries. Savings, however, are the excesses after our needs. In every society, it is the savings of the rich mostly that fund investments. Since the rich in
Nigeria
saves outside
Nigeria
, it would be suicidal for a foreign Investor to commit his own people’s savings in
Nigeria
that Nigerians do not save in. Our economists know this, but would rather chase shadows.
Economic systems, put simply, are means of wealth distribution. The American system for instance is a closed circuit system, based on no flight of capital. If a City Hall worker gets paid every Friday for example, he is supposed to pay from his pay check, a part of his mortgage (shelter), a part of his car hire purchase (transport), provide food on the table for his family, buys clothing for his family, etc. All the businesses that the City worker patronises are, however, taxed by the City and by Thursday, the money the City worker was paid last Friday is back to the City Treasury, for him to be paid again on Friday. It is a smooth unbroken chain that keeps every sector happy and developed. Any flight of capital from that system would break that chain and the economy would suffer.
Issues like this are what should concern us and not the colour or tongue of the presidency.
As I looked at the list of prospective first citizens, I did not see anyone that will raise
Nigeria
’s GDP to $100 billion in 4 years. Forget about the governors asking to be promoted as the first citizen. None of those was able to raise the GDP of their respective States in spite of the largesse from
Abuja
. Instead, they personified the flight of
Nigeria
’s capital. As for me, anybody that does not close all his accounts overseas, like Buhari did when he took over government in 1983; brings his children home into the local education system and grounds his wife locally, cannot have my vote. I stand accused for discriminating on the bases of divided loyalty. Let us stop kidding ourselves. Unless the Investors see that our leaders, at least, have all their monies in
Nigeria
, none will commit their own savings to
Nigeria
. The trickle of investments the country is witnessing are round tripping by those that exported Nigeria’s wealth, in the first place, but it is not the same as having their savings in Nigeria.
Samuel Akinyele Caulcrick.
Lagos
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Authors 
Posted by Robot| 23.11.2006 06:05