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Why the poor stay poor: The problem is unrestrained capitalism

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By Tabia Princewill
OUR fundamental problem in Nigeria isn’t the quality of our elections, our problem lies at the heart of our understanding of democracy: up until recently, we had no institutionalized forms of welfare or commitment to equality and social justice. When will we see that beyond APC or PDP our problem is the extreme form of capitalism we practice which legitimizes prioritizing the comforts, needs and financial opportunities of the rich at the expense of everyone else in society?

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In America, income inequality is frequently a topic of discussion. Conversely, in Nigeria, the media and public opinion are obsessed with electoral politics, reducing our understanding of political affairs to the competition for power involving various individuals running for office; but we rarely discuss the structural issues which impede development no matter which persons or parties are in power. Doing so runs counter to the interests of some very highly placed people.

Discussions about restructuring our system only seem to tackle resource sharing, meaning the funds which are accessible to public officers, and not the mechanisms which are ultimately responsible for mass poverty or redistributive policies to create a fairer, more equal society.

Redistributive policies

Nigerians treat equality like it’s a bad word: we prefer token charity initiatives and drop-in-the-ocean philanthropy to discussions about systemic change which could lift millions out of poverty.

Business men continuously benefit from strange tax waivers, and our legislators continue to earn some of the highest salaries in the world, and states find it difficult to pay workers, yet there is no mainstream campaign to call for the national assembly in particular to take a pay cut: despite grumblings in beer parlours and on some political discussion programmes, Nigerians rarely mobilize to solve the real issues.

If government’s wage bill were lessened by cutting some of the most outrageous benefits accorded to NASS, wouldn’t we be able to comfortably afford to pay the new N30,000 minimum wage? Why should those at the bottom continuously pay to maintain the living standards of the most unproductive elements at the top of the social pyramid?

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In the 1990s, Nigeria eagerly embraced the IMF and World Bank ideology therefore cutting welfare and wages for those at the bottom: we’ve never recovered our social conscience since then. The IMF now admits that inequality hinders economic growth, but many policymakers in Africa are yet to respond (partly because it has been politically expedient to keep people poor and largely uneducated) and mass mobilization to tackle the excesses at the top was effectively killed by the military, and too few activists today are committed to addressing the disenfranchisement and exploitation at the bottom.

Proof of this is that there is still little support for this administration’s efforts to widen the tax net: typically, in Nigeria, only civil servants pay regular taxes often because they have no choice (their taxes are deducted at the source). But who remembers former minister of finance, Okonjo-Iweala’s, 2014 report? She revealed the then federal government had lost N800 billion to tax waivers and concessions granted to various businesses between 2011 and 2013.

When the government loses such sums, where do we imagine the funds for social spending, meaning the funds which directly impact you and I, will come from? Education, health, welfare and labour rights have been at the bottom of the political agenda: how ironic, the poorest region on earth, Africa, is where one finds the most committed people to global capitalism and its most extreme forms of anti-people policies.

The West engages in different forms of protectionism, literally “protecting” key sectors and jobs from foreign competition, but in Africa we prioritize foreign direct investment over building our local industries and manufacturing sectors, often because African policymakers themselves have close ties to Western governments and to the foreign institutions who depend on Africa remaining open to being a dumping ground for their products.

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When former World Bank or Central Bank employees run for office in Africa, we take this to mean they are competent and experienced. We don’t realize that the monetary and fiscal policies such individuals pursue are often precisely the reason for African poverty: we cannot continue to uncritically follow the global liberal agenda. Terrorism and insecurity are products of rampant, unrestrained capitalism in Nigeria which neglects social investments in the majority of the population in favour of investments in financial circles, creating monopolies and killing competition.

Femi Falana recently spoke out against the practice of allocating oil blocs to individuals and international oil companies. Indeed, the Nigerian economy, an extreme take on capitalist ideology, allows and encourages the concentration of wealth in the hands of a few. Military governments awarded our resources to their cronies (many of whom had neither the technical know-how or will to manage them efficiently) and such habits are responsible for Nigeria (and Africa’s) difficulty in producing an entrepreneurial class which doesn’t rely on government favour, contracts or advantages to survive. If it is true that government plans to revoke a number of oil blocs, Nigerians must understand what this means and support it.

A mixture of local elite and foreign interests have frightened and confused Nigerians into thinking that prioritizing their wellbeing is synonymous with the interest of the majority. Far from it. Although on the surface indigenous corporations compete and produce wealth, the majority of Africa’s resources are mined and traded by foreign corporations and nations who decide prices, and only pay paltry sums to host countries in the form of taxes, if and when they do pay.

Infrastructural development

Furthermore, to quote Mr. Falana: “by merely collecting huge rents the oil bloc owners become stupendously rich while the federal, state and local governments depend on loans and bailouts to pay salaries and carry out basic infrastructural development. Thus, by allocating oil blocs to a few individuals and corporate bodies the federal government has violated Section 16(2) (c) of the Constitution which provides that “the economic system is not operated in such a manner as to permit the concentration of wealth or the means of production and exchange in the hands of few individuals or of a group.”

Our constitution’s wording outlaws unbridled, unstrained capitalism! If President Muhammadu Buhari goes ahead with such a plan, he will undoubtedly be labelled “anti-free market”, “anti-business” and a dictator. But we never think who really benefits from foreign corporations activities in Africa, nor do we interrogate the ideology that makes oil wells primarily private resources empowering only a few people.

Our constitution says the Nigerian state must “control the national economy in such manner as to secure the maximum welfare, freedom and happiness of every citizen on the basis of social justice and equality of status and opportunity.” Yet our economy is geared to do the opposite. Forget arguing over APC or PDP, let’s discuss the real effects of our economic system.


THE Speaker of the House of Representative wrote to the International Criminal Court, ICC, the US, UK and the EU to complain about the Federal Government’s alleged plot to “unleash violence on innocent citizens of Bauchi state” during the supplementary elections.

This neo-colonial mindset is troubling: why must the rest of the world police Nigeria? Politicians write to foreign institutions like students petition school authorities: how infantilizing, we still require foreign powers to act as referees or observers. Can we accomplish nothing on our own?

The Muslim Rights Concern

THE Muslim Rights Concern, MURIC, group asked President Muhammadu Buhari to appoint Muslim ministers from five south-west states because governors of the said five states are Christians. When will we stop prioritizing ethno-religious belonging over competence?

Federal character forces us to fill slots with little regard for competence. Like zoning, it is a military legacy we must urgently rethink. Is MURIC trying to be the Muslim version of the Christian Association of Nigeria, CAN?

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Religious groups must stop interfering in politics. The South-West is perhaps the only region where Muslim/Christian relations aren’t strained. We mustn’t allow MURIC, CAN and others to politicize religion.

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