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The dangerous path towards prosperity

By Adisa Adeleye

In the week dominated by the sad news of attack by gunmen on the police detention facilities (SARS) in Abuja and the bombing of St Andrews Military Protestant Church in Jaji, the welcome relief was the reported statement of the Central Bank Governor, Mallam Sanusi Lamido Sanusi that half of the civil service work force should be sacked to curb wasteful expenditure. Though comical, Mallam Sanusi‘s statement confirm the observation of many people over the years.

Although Nigerians are becoming reconciled to the precise bombings of Boko Haram sect and also, becoming familiar with murderous attacks of “gunmen” on innocent people, the frequency of these attacks and the choice of targets are becoming uncomfortable to the extent that many Nigerians have started to doubt the ability of the government to give adequate protection against the destruction of life and property.

However, it is the considered opinion of many people that the government is trying its best through the activities of the security forces.

What is worrisome, if not perplexing, is the attitude of many Nigerians towards the Boko Haram insurgency.  It is generally seen as a mere disturbance by some armed groups against the people and governments of the North Eastern part of the country and the Federal Government.

Some people talk glibly about Boko Haram as if it is a regional affair and continues to urge the Federal Government to resolve such security problem immediately.

People of Southern Nigeria pray and should continue to pray that the insurgency in the North should not extend to some areas of the South to avoid terrible consequences among the different religious groups.

The only way to stop the drift of Boko Haram insurgency to the South is the immediate realization by the people of the South that this insurgency in some parts of the North is a national problem that should be tackled nationally.  It is not the Federal Government problem alone or that of PDP as the government party, it looks like a cancer that was not detected on time and that has now become a devastating disease.

The necessary surgical operation is the responsibility of every Nigerian in every part of the country.

If the Boko Haram insurgency in the North has become a serious political and economic problem, the open operations of “gunmen” and armed robbers in some parts of the South are now assuming larger proportion and constituting serious danger to the economic life of the country. 

The other day, armed robbers wage a successful war against the people of Auchi in Edo State that Banks had to resort to closing down for some days.  In many cities of the South, unknown “gunmen” and armed robbers, in spite of police challenge, have started to establish their rule and make economic activities very risky.

Also, numerous cases of kidnappings for monetary rewards are widely reported.

Many analysts have traced the acts of insurgency, armed robbery and kidnapping to forces of mass illiteracy and mass unemployment.

The abject poverty that breeds such discontent is firmly rooted in the nature of a country which is abundantly blessed with human and material resources but fails to harness the opportunities for positive and prosperous living.

That Nigeria is a country of two nations, the RICH and the POOR is axiomatic.  Nature has endowed the country with enormous wealth, but unfortunately, the management of the resources had for long been misplaced.  Our problem is not to create more wealth, but to use the limited wealth to eradicate poverty.

The best way to eradicate poverty is to create mass employment.  The greatest goal of every civilized government is to ensure that there is a job for every able hand.  People who should produce commodity for home consumption and for exports should not remain idle; otherwise they could become innocent agents of insurgency, armed robbery and kidnappings.

It is, therefore, necessary for any serious government to embark on economic expansion in order to promote mass employment and eradicate poverty.  Within the context of full employment policy, it may not be wise to reduce by half the total strength of government workers, but a sound advice would be to make that working population more productive, less corrupt and less wasteful.

It is generally believed in the developed world that the economy could be subject to a deficiency in demand (which would lead to closure of plants and lay off of workers) and that offsetting by government action would be required.

This could result in injecting more money into the economy to stimulate effective demand and thereby, promoting expansion in the economy and increase in employment.

Cheap money vs tight money
Since Mallam Sanusi Lamido Sanusi became Governor of Central Bank, there had been changes in Monetary Policy Rate (MPR) about six times, in an attempt to combat inflation.  The Central Bank has adopted what is known as Tightening Monetary Policy.  Observers believe that for now, the country should try cheap money policy.

During the operation of cheap money policy in Britain; it encouraged capital investment in rail/ road improvements.  In Nigeria, rail/road had virtually collapsed.  The once pleasant passenger-rail wagons and coaches from the South to North and East have become agonizing memories for people of over 70 and 80 years of age.

And our present rulers, most of them below the age of 60years could not have missed something they did not know.  The present numerous oil tankers and rickety buses plying our ill-maintained roads these days, are consequences of the decaying railway system.  Modern railway system suffers from paucity of capital investments as a result of high cost of borrowing.

In Britain, there was also an outburst of building and slump clearance as a result of cheap money (low interest rates).  Nigeria witnessed an expansion in building and construction activities both in public and private sectors in the 1970s and 1980s when bank loans were under 10%, or when loans were cheap. Most of the luscious private estates of today were developed during the period.

The incipient middle class was firmly established under cheap money.  A family could own a house, a car and could afford a foreign holiday, at least once a year.  At present, loans for private developers are prohibitive while the prices of building materials are escalating every day, condemning the poor to their lowly state as perpetual tenants.

We believe that the Central Bank Governor could help by persuading the government to abandon its present tightening monetary policy in favour of economic expansion and eradication of poverty through increase in employment.


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