By Tabia Princewill
According to the World Bank, the Nigerian economy has been “slipping” since 1995. Interestingly, a majority of newspapers chose the headline “Nigeria’s economy slips” which mischievously tells a vastly different story from the World Bank’s original submission. Recently, Bloomberg published an editorial telling President Buhari to focus on economic growth in his second term. That statement appears logical, until one begins to question what sort of growth pundits refer to. Un-inclusive growth, which benefits only a few at the expense of the many, is responsible for a growing number of conflicts and political instability around the world. Donald Trump probably wouldn’t have won the 2016 US election without stoking the xenophobia, status anxiety and resentments of white working-class people following an economic downturn, and decades of feelings of betrayal by an ultra-capitalist economic system which benefits only the top 1% of the economy. Yet, pundits around the world, while recognizing the failures of unregulated capitalism which has virtually destroyed Western society’s cohesiveness, are still pushing the developing world to uncritically embrace an ideology which has already shown its negative consequences.
Foreign media, corporations and so-called development experts have been pushing the same liberal agenda which gave us the disastrous structural adjustment programs we are yet to recover from. They call Buhari a statist, interventionist relic, or even a populist, because he doesn’t blindly endorse their neo-liberal messianism which prioritizes financial interests over the goals of the real economy: employment creation and poverty reduction. This obsession, for example, with the privatization of NNPC, which on paper might seem like it makes sense, is in defense of the profiteering of the same unproductive business interests who took over government assets during privatization in the 90s (allegedly with access to government funds and support) and have been unable to increase Nigerians’ power supply. Those of us who believe, as I said in my column last week, that a strict, unquestioning adherence to neo-liberalism is at the root of global poverty, are still of the opinion that chasing economic growth alone will not yield results for the majority of Nigeria’s poor or working class people unless we embrace an ideology that puts inclusive growth at the center of our political targets: chasing Foreign Direct Investment (FDI) alone, obsessively watching GDP growth without first re-writing our economic philosophy will get us nowhere fast.
People who think that investing in poor people doesn’t benefit the
have basically embraced every tenet of neo-liberalism without stopping to think why it seems, that across the decades, no matter the head of state or the party in power, the overall situation in Nigeria seems to stagnate, getting better on the surface (progress for a small number of people with access to government, or their hangers-on) and slipping back into chaos as soon as any major shock occurs. Without safety nets for everyday people, including greater insurance for the average Nigerian’s deposits in a reckless system where banks keep giving loans to the same set of predatory individuals whose debts are written off, putting the rest of us at risk, chasing economic growth will not deliver the promised national benefits. Not only have we embraced the elitist, ultra-liberal assumption that only the top 1% economic prospects must be protected at the cost of opportunities for everyone else, we believe only they have the capacity to create wealth and jobs and therefore we give them untenable advantages in the form of tax cuts, subsidies and waivers, forgetting that without improving the incomes of working-class families, we cannot build and sustain economic recovery. Our economy works only for plutocrats, people who have already received so much from the system and given much less back. We will continue to see violence and insecurity across the country if we do not put working class individuals at the center of our economic policy: trickle down economics has failed and will continue to fail. Investing in the same people at the top (through corrupt practices or semi-legal, unethical means) isn’t just untenable, it doesn’t produce lasting results. All over the world, policy makers know the middle class is the engine of any successful economy: yet, Nigeria hopes to grow without rescuing its decimated middle class. The rich getting richer at the expense of the rest of society isn’t just ironically inimical to the very growth we pursue, it is dangerous for our democracy, due to the control over our institutions and politics which money buys.
Globally, we determine how well nations are doing by tracking GDP, Gross Domestic Product, the measure of activity in the formal economy and thus our measure of growth. Interestingly, the creator of the concept, Simon Kuznets, had reservations about it which he expressed: “the welfare of the nation can scarcely be inferred from a measurement of national income”, he said. “Distinctions must be kept in mind between quantity and quality of growth, between its costs and return, and between the short and the long run. Goals for ‘more’ growth should specify more growth of what and for what.” The kind of growth Bloomberg and other neo-liberal institutions are calling for isn’t pro-poor growth, it’s a growth that only empowers local and foreign private financial interests, those, for example who would be interested in buying a dismantled NNPC. Watching Africans relinquish sovereign control of their resources is a capitalists’ dream, and it is essentially separate from producing jobs and wealth for ordinary people. Prioritizing growth has cost the world economy a lot in terms of wages: people do more business and that’s wonderful, but why are salaries still falling for those at the bottom? Why does most of humanity have to go through life without access to healthcare? Why is it a crime to demand that government directly invests in those whose combined health and education produces a purchasing power which is the backbone of modern economies? Rather than simply reviving our economy, we must transform it: state sponsored economic activity at the top, allowing wealthy businessmen get away with tax fraud, or by granting them monopolies, will never produce enough jobs to impact unemployment. Prioritizing private financial interests over the welfare of ordinary people is killing society and re-writing the rules of engagement. How did we get to be such a lawless, predatory country? By enshrining economic growth as the measure of success and refusing to talk about growing inequality.
Micro pension plan
Because the media ignores initiatives to restore dignity and economic power to those the system generally forgets, I’m reminded that rather than being without an ideology, as most believe, our society is right wing and conservative. Besides tokenistic charity initiatives, many middle-class Nigerians neither understand nor support targeted investments in the poor as a path to economic recovery. Farmers, petty traders and workers in the informal sector have always been excluded from pension plans. Ironically, not much was said about the launch of the micro pension plan. According to President Buhari: “this initiative was designed to capture citizens that aren’t in the formal corporate sector. If you recall, one of the three core pillars of this government is the creation of a diversified and inclusive economy. This can only be achieved by creating an enabling environment for farmers, entrepreneurs and SMEs. The dignity of retired public servants who sacrificed their lives for this country will be restored. We will ensure all hard-working Nigerians in the private sector, both formal and informal, can retire without fear”. There is no nobler objective.
Udoma Udo Udoma
The Minister of Budget and National Planning announced the government would revert to the January to December budget cycle, starting with the 2020 national budget, in order to facilitate planning for both public and private sectors. So many dysfunctional practices have been normalized over the years. To restore sanity, our budgets must work for the majority, through more efficient allocation of resources: can we tackle the huge pension plans and life salaries for public officers, draining our treasury?
Tabia Princewill is a strategic communications consultant and public policy analyst. She is also the co-host and executive producer of a talk show, WALK THE TALK which airs on Channels TV.