By Muhammed Adamu
I HAVE not been able to resist the temptation to serve readers this week an abridged version of a piece I wrote sometime ago titled ‘Of Trust and Economic Growth’. With the recession firmly around now, it appears the priority of every columnist should be the economy, the economy and the economy. But can the economy be in a recession and still be doing well?:
Magnus Kpakol, Obasanjo’s Chief Economic Adviser, seemed to have pre-empted this question years ago. He was the one who explained ‘economic growth’ in terms of ‘any gain -no matter how minuscule- that rolls back on a ‘loss’ situation; some kind of reversal, no matter how infinitesimal, of a decaying economic condition, or an onset of ‘increase’ –however little- even in a massively declining resource situation. These jargons used to be the preserve of ‘development economists. Not anymore. Matters of economic ‘growth’ and ‘development’ are now so perverse we have all become economists pointing the way to growth or warning about stagnation.
Kpakol had argued that even in the most obviously morose situation, a little effort to remedy an economic malady, is counted as ‘growth’ because it is a journey towards ‘healing’. He illustrated this using the fate of a long distance runner who falls off track, into a ditch, but whose every little effort at climbing out is a positive ‘gain’ in the direction of returning back unto winning ways. And so as ‘development’ is a product of ‘plan’ and ‘organization’, so is ‘growth’ a function of ‘progressive exertion’ in the direction that reverses rot. This is without prejudice to the fact that not all ‘change’ is ‘growth’, and not all ‘movement’ is necessarily ‘forward. But sometimes it makes sense to ‘move back’ in order to effectively ‘move forward’. Often it has to get damn bad before it gets better.
Things are either in a degenerate (regressive) state, stagnant (dormant) or they are moving forward (growth). It is the difference between drowning, floating or swimming! And it takes a lot of paddling today even to stay ‘afloat’ (stagnant). The situation of Kpakol’s ‘runner’ will be different if as he fell into the ditch he had broken his back and therefore cannot muster any effort towards climbing out. In which case he stagnates and may soon begin to degenerate even into a worse condition. Thus, even ‘stagnation’ is still more desirable than ‘retrogression’. A ‘no-growth’ situation is better than a state of decay.
We managed to ‘swim’ under Obasanjo. We paddled hard to stay ‘afloat’ under Yar’Adua. But under Jonathan, the ship of State had gathered so much moss, it was already ‘drowning’. We had slipped off the cliff already and could not have landed in one piece without a shattered carapace. And now is the time to put our broken pieces together and move on. But even that cannot be done without some pain! There will be pain when the doctors apply the methylated spirit. There will be more pain in fact when the surgeons put their knives and pincers to work.
Growth for us is that we have transited from a profligate Jonathan regime -even if- to a frugally prudent Buhari administration. Growth for us is that we have virtually put a stop to humongous theft, mismanagement, waste and leakages in the administration of the Commonwealth. Growth for us is that we are on the path of ‘regeneration’ –no matter how slowly so- and no longer in the throes of rot or decay. In fact ‘growth’ for us is that our pain today pleasantly comes from the healing hands of a physician we can trust, namely Buhari and not from the cursed fangs of a rabid canine that had afflicted us all
American Economist, Arthur Burns once on a visit to Israel in the 70s said he asked that country’s first Prime Minister, David Ben Gurion how Israel was able to ‘grow’ and ‘develop’ her economy in the absence of basic natural resources and on the bare backs of a barren desert. And Arthur Burns said that Ben Gurion said: “We did it first by dreaming, then by doing what the economists said was impossible” –which is a euphemism for saying ‘we jettisoned established theories of macro and micro economics and we tried previously untried ideas’. It is like saying we rebelled against the grain of economic norms and we created for ourselves new norms.
And Singapore’s late President, Lee Kuan Yew, when he was asked about the economic and technological ‘miracle’ that he brought about in his country, denied that there was actually any miracle. Simply he said: “We did a few things right and we kept doing them right” –which is also another way of saying simply ‘we gambled, but we were sincere enough in our ‘gamble’ to jettison what was wrong and to hold on to that which was right.
The Israelis have proved Arthur Burns right in his treatise on ‘national economies’ where he wrote: “the human element” is a basic ingredient in the creation of virile, vibrant and stable economies. And the ‘human element’ which he said consists mostly of the dreams, fears, and hopes of a people, is often capable of upsetting even “the most expert calculations”. It took sincere ‘trial and error’ not the ‘expert calculations’ of sophistic, hair splitting, doctrinaire economists for Israel and Singapore to get it right.
Now that recession is here
THERE is no debate about the definition of ‘recession’. Economists say that it is a ‘persistent combination of high inflation, severe unemployment, and sluggish economic growth’. When the Gross Domestic Product, GDP, (or the total value of goods and services produced in a country over a period of time), declined for two consecutive quarters, the economy is said to be in a recession. But away from textbook definitions, there are varying ways by which many have explained what it means to be in a ‘recession’. Someone said that the Nigerian economy –like an accident victim- is in a ‘knocked down’ situation, bleeding profusely from all conceivable openings.
First you have to stop the bleeding, and then –if the victim has lost so much blood- give him some more. Another economist used an engineering metaphor of ‘engine failure’. He said that all the engines that drive the Nigerian economy have shut down –and are in need of urgent re-ring or outright replacement. A sudden slump in the economy’s cash cow –namely oil, has occasioned poor revenues; and a persistent energy crisis has resulted in businesses hemorrhaging and beginning to shut down!
But there is another metaphor which conveys a more poignant picture of ‘recession’ in an economy -the metaphor of the ‘benevolent burglar’. I conceived it from a paraphrase of Jennifer Patterson’s jive about ‘every house in town being so miserably broke these days even burglars fear they might be persuaded instead to leave a tip’. And so if the bigger masquerade ‘depression’, is an advanced stage of ‘recession’, one can only pray that we may never experience a ‘depression’ besides what the textbooks have said it is –namely ‘a period characterised by low production, low sales and a high rate of business failures and unemployment’. By the way if houses get so broke in a ‘recession’ burglars might be persuaded to turn ‘benevolent givers’, it is left to the imagination what they will do in a ‘depression’.
I have not seen yet any economic literature anywhere titled ‘How to get out of a recession without pain’; -without ‘weeping and wailing and mourning and gnashing of teeth’. Nor have I seen yet any economic combat kit on ‘How to avoid a ‘depression’ without lifting a finger’.
There is one thing economists say that money CANNOT buy, and that is ‘poverty’. But this theory has been clinically debunked by us because we have at last successfully used our petro-dollars to buy us a most biting ‘poverty’ -called ‘recession’. We have always taken everything for granted. We had it going so very well in the sixties that Gowon was said to have boasted ‘the problem of Nigeria was not money but how to spend the money’. And we were so bigotedly self-harming only recently we cheered Jonathan as he loaded a jet with our petro-dollars crisscrossing the length and breadth of this country bribing to get reelected.
And now even as we harangue a conservatively puritan –or should we say spartanly punitive- Buhari, to right the economic wrongs of his forbears, we still cheer and defend those whose acts and omissions brought us at death’s door! We are all guilty one way or another; those who destroyed the economy and those who supported those who destroyed the economy; those who watched the economy being destroyed and those who are vehemently opposed –even now- to every effort at rebuilding the economy. We cannot eat our cake and then have it. We have all played a part in the ruination of the economy. And we must all be ready to pay for it! If stupidity got us here, we must decide what should take us out: ‘stupidity’ or ‘common sense’?
People ask ‘how soon can we get out of the ‘recession’?’. I think as soon as we rise up to avert a ‘depression’. Rohatyn, one of the men credited with saving New York City’s economy from its fiscal crisis of the mid seventies –a crisis deeper than America’s recession of the 80s-, said “We did it by being ruthlessly realistic about the mess we were dealing with and (in fact) by assuming, quite correctly, that when things look very bad, they usually turn out to be worse than they look”. Weighing the menace more serious than it seems. Rohatyn was the one who compared saving New York City from bankruptcy to making love to a gangling gorilla, saying that “you don’t stop when you are tired; you stop when he is tired.” We must gather all our energies in one hub of action. We are about to make love to a gorilla.
And this for IBB
BETTER late they say, than never. He has recently celebrated his 75th birthday. And for me really, being a brother virtually from the same homestead, it has always been ‘damn you if you land a blow on IBB’ and ‘damn you if you don’t! What can I do? Sometimes I land a blow on IBB, and sometimes I don’t. When he clocked 69, I wrote for the first time about him, a tribute. And now at 75, I am doing virtually the same thing; I am quoting three paragraphs from that tribute to do the duty of a brother, to a brother –paying my respect as he clocks 75. Read on:
“Reminiscing my reportorial days of the IBB era, is at once evocative of his last Second-In-Command, the mercurial, irascible Admiral Augustus Aikhomu. A surge of multi-hued nostalgia, ranging from the seriously comic, the comically serious and –with a maverick like this Admiral- nostalgia for the unpredictably bombastic. Just one press conference by Aikhomu would spawn enough materials to keep press, people and polity busy for quite some time. And to think that this was not just a one-off; it was a weekly media interactive of the Babangida administration. Earlier than Babangida, a genteel, intellectually bent predecessor of his, Ebitu Ukiwe had engaged some of the nation’s Ivory Towers’ best on an NTA Weekly ‘One On One’ providing a veritable on-air public account in a non-democratic environment. The prime-time nightly policy intercourse on the administration was, to say the least, stimulating; and in the context of the libido for the goings-on in the IBB government, politically gripping!
Occasionally if memory serves right, not ever later than at least a quarter, the self-styled Military President himself, would take on especially editors or publishers from Lagos on a no-holds-barred inquisition of his administration. In comparison now with full-blown democracies, nothing could have been more courageous –that a military dictatorship, averagely on a weekly basis, stripping itself bare, exposition its biceps and its tendons and seeming to challenge both the critical and the cynical members of the public to take their best shots! Whatever it took for the bayonet to develop such nerve before the inquisition of the pen, it would not exclude at least some measure of regime sincerity and an uncanny ability for the actors to be right on top of their rudder. And a rudder at that: in superintendence over a multiplicity of policy ferments, engaged actively in the steering of numerous steamy pots of ideas; some cooking, some frying, others stewing and yet many caking; from DFFRI, to NDE;
NDLEA to FRSC; Peoples to Community banks etc.
What the (IBB regime) literally did with us weekly was to provide an official garnishing avenue, where to prove that although as they say, ‘too many cooks spoil the broth’, yet when chefs appeared effectively on top of their earthen wares and fully conversant with the vents of their kitchens’ chimneys, sometimes ‘many cooks’ rather than ‘spoil the broth’, can actually only ‘make work light’!
Happy birthday, Sir”.