Thursday, 12 January 2012 22:23

The Fuel Subsidy Crisis And Igbo Political Behavior

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Having delineated the fuel subsidy removal matter and Nigerians demonstrations against that policy, the paper asks why Igbos are not participating in the demonstrations.  It presented Igbo culture and character as the reasons why. Igbos are socialized to look after their self-interests and not work for public good. Igbos do not sacrifice their lives for other peoples good.

The Fuel Subsidy Crisis And Igbo Political Behavior

By Ozodi Thomas Osuji

Some Igbos with a smattering knowledge of economics tell us that on economic grounds it is right for the President to remove fuel subsidy; therefore I will begin this discourse with a foray into economics.

The Goodluck Jonathan government decided to let go of fuel subsidy that the federal government had in place, a subsidy that kept the price of fuel at very low price.  We infer that the reason for removing the fuel subsidy is economic. In a free enterprise economy, which Nigeria supposedly has, the forces of the market are supposed to determine the price people pay for goods and services.

In a capitalist economy, people who want to sell something bring it to the market place; people who want to buy it negotiate with the sellers and both agree on a price (equilibrium price) that they find reasonable for the good and it is sold. The seller incurred cost in producing a good and he sells at a price that his cost is covered and he makes some profit; the buyer has limited resources and buys at a price he deems to meet his values.  This way, the forces of supply and demand, aka market determine the cost of goods and services.

The free market decides the allocation of resources in the economy. The market is the most efficient means of allocating resources to where they are need in an economy. Why? Individuals are rational beings; in pursuit of their self-interests they buy only the goods that they need and do so at the lowest price they could get. Given this reality, suppliers of goods therefore try to supply only those goods the people demand and do so at the lowest price they could afford (hence must reduce production cost, that is, produce efficiently).

Economic systems where central committees decide where goods and resources are to be allocated are generally inefficient. The invisible hands of the free market are the most efficient means of allocating resources and generating wealth for individuals and nations.

America and the West generally have capitalist or attenuated capitalist economic system. The former Soviet Union, Eastern Europe and China generally had planned economic systems.  Clearly, the capitalist system allocated resources more efficiently than the Soviet system; this was demonstrated by the fact that consumer goods were more available to the consumers in the West and were lacking to consumers in the former Soviet Union.

In capitalist economies individuals  work hard (because their incentive is that they keep the profits accruing to their labor) whereas in planned communist economies individuals tend to have less incentive to work hard (because their labor was not fully rewarded as the state appropriate some of their  profits). Rational persons like to sell their goods and services at the highest price they could get for them and make profits; if the profit incentive is taken away from them they find no need to work hard. Thus, Soviet workers were less hard working than American workers. American workers were the most efficient workers in the world.

The American economy that produced efficient workers and consumer goods is presented to the world as the best economic system there is.

In 1944 it became clear that Adolf Hitler and his Nazis would be defeated but not before the war had destroyed Old Europe and produced a new superpower, the USA. The USA looked to become the most powerful military, political and economic country in the post-world war world.

America organized a conference at Bretton wood, New Hampshire, USA (1944) at which it planned for a way to manage the post war world economy.  At that conference several economic instruments for managing the world economy were established, including the International Monetary Fund (to provide nations with short term loans), the World Bank (to provide nations with long arm loans) and the International Bank for Reconstruction and Development( IBRD is today part of the World Bank Group).

Elsewhere at San Francisco, California another conference reshaped the Old League of Nations into what is now called the United Nations Organizations; it remedied the problems with the League; the League had given all members equal voting rights thus making it impossible to make decisive decisions and fund them; the UNO was divided into a General Assembly where all members have equal voting rights, and a Security Council where only the Big Five can make crucial decisions on war and peace and fund them.

Generally, the Bretton woods instruments were established to make sure that the collapse of Western economies during the great depression did not recur. When nations collapse economically they tend to be amenable to capture by dictators. Adolf Hitler and his Nazis apparently were able to capture Germany because it had economically collapsed (from many factors including the war indemnities it paid the victorious allied countries and the great depression that began in 1929 and lasted to the Second World War). The reason for establishing the Bretton woods institutions appear good intentioned; however, there were not well publicized reasons for establishing those institutions.

He who pays the piper calls the tune. America provided the seed money for the operation of the Bretton Woods institutions and the United Nations Organization. (It is not for nothing that that both institutions are headquartered in the USA, Washington DC and New York City.)

The Bretton woods institutions hidden agenda is to make the world safe for free enterprise economy; they are instruments for the domination of the world by America.

There is no doubt that with the waning of America’s military, economic and political dominance in the middle of the twenty first century the Bretton woods institutions and the capitalist economy in general would be reorganized.  For now we shall assume that there is merit to what Adam Smith wrote in his great book, The Wealth of Nations. We are living in the American century and do not need to delude ourselves by denying that reality.  That been said, we also know that in life everything that goes up must come down. Empires come and empires go; change is the only permanent aspect of our existence.

Adam Smith and David Ricardo’s version of free market economy is not the only approach to economics. John Maynard Keynes during the great depression presented an economic approach that to him would prevent the tendency for capitalist economies to go through cycles of boom and bust. He encouraged national economies to do certain things during periods of economic growth (and attendant inflation) and periods of downturn (and accompanying recession and depression).  Over simplified, he encouraged high taxation during inflationary periods; the idea being that if people’s moneys were taken away by the government that they would not have much left to spend hence inflate prices.  During recessions he encouraged low taxation thus leaving the people with more money to go out and spend with and in doing so stimulate demand. Demand stimulates supply and that gets businesses churning out goods and services.

Keynes argued for public spending to affect the direction of the economy.  During recessions and depressions the government is to consciously spend money (even if it has to borrow the money and run budget deficits, as both George Bush and Barack Obama did by borrowing from China). Money spent on big constructions, such as Tennessee Valley Authority, Dam, generates jobs. Folks with paying jobs have money to spend, spending that stimulates the economy.  Instead of most of the people staying unemployed if they are given jobs and are paid they spend their moneys buying things and those they bought from have money to invest in other goods and services; the multiplier effects of their spending leads to improvement in otherwise depressed economies

Apart from fiscal policies, the government has other ways of regulating the economy including monetary policy. Banks borrow money from the central bank. The central bank charges them interest on their borrowing. Raising or lowering the interest the central bank charges banks affects the level of their borrowing and consequent lending to their customers. The interest rate charged by the central banks of the world affect the money supply in the economy and ultimately economic activity.

Since the end of the Second World War the two economic approaches that dominate the West is classical Adam Smith Economy and Keynesian economy. (Planned economies existed in Eastern Europe and other communist lands.)

At the University of Chicago economic department, Milton Friedman and his colleges challenged the Keynesian approach to economics and especially went to war with planned economies. Essentially, they argued for return to classical Adam Smith economy. With their armament of statistics they showed how if left alone the forces of the market are best at allocating resources and building wealth for nations. Mercantilism is bad, Adam Smith had told us, and Friedman reiterated that point.  His mantra can be summarized as follows: governments should hands off the economy and let the forces of supply and demand determine the prices of goods and services and where resources are allocated to. In his view this was the only way to grow the economy.

By the early 1970s the Chicago school of economics had won the battle of economic ideas. The Nixon Administration in Washington DC while still practicing Keynesian economics ironically forced other nations to reconsider their Keynesian economic policies. Latin American countries under the duress of America offloaded their state run corporations, and sold them to venture capitalists. Those Latin American countries eventually collapsed; Chile, Argentina and Brazil collapsed, thanks to pure free enterprise economy.  Those countries naturally abandoned their IMF and World Bank induced insanity and returned to some form of mixed economy and today are beginning to dig themselves out of the hole the old Jew, Milton Friedman, and his cronies dug for them.

With the rise of Margaret Thatcher (1979) and Ronald Reagan (1981) in Britain and America Friedman’s economic ideas (now called Supply side economics… Arthur Lafer, a student of Friedman had argued the benefits of allowing the suppliers of goods and services to keep their profits by not taking large portions of them in taxes; he said that they would reinvent their profits and grow the economy; that they create jobs; actually those folks used their millions to build mansions and buy luxury Yachts).

America and Britain tried to privatize the public sector of their economies.  Were they successful? Was the 1980s Britain and USA a robust economy?  I will leave you to decide for yourself.

The salient point is that the world is presented with certain economic systems, and that each proclaims itself the best for the people.

The Nigerian minister of Finance, Ngozi Okonjo Iweala, is a Harvard trained economist who worked for one of the Bretton woods institutions.  Although she has not really written anything that one can read and assess her economic views we can infer that she bought into the economic system of those who trained and employed her? (What exactly is the economic view of the lady who apparently markets herself as an economics wonder woman? Does she really know something about economics or is she merely a histrionic cum narcissistic woman hoodwinking such simpletons as Obasanjo and Jonathan into seeing her as a technocrat of the first order?)

The Jonathan government removed subsidy for fuel for economic reasons. Let us then see what could happen. The forces of supply and demand would determine the eventual price of fuel sold at Nigerian gas pumps.

The average Nigerian makes about two US dollars a day.  With that kind of income the average Nigerian barely eats food to sustain his body.

With the removal of subsidy, gas price has jumped from 65 nairas a liter to almost 200 nairas a liter. There are four liters in a gallon. That means that the price of gas is now 600 nairas or four dollars per gallon. The price of gas in the USA is $3.30 per gallon. That is to say that gas now costs more in Nigeria, a poor country, than in the USA with per capita income of over $32, 000.

Most business activities are affected by the cost of fuel. It takes fuel to produce and transport food to markets; provide electricity, run schools, hospitals, everything. The increase in the cost of fuel would therefore lead to increase in the cost of everything, especially food. Those who were already barely staying alive at $2 a day now must pay more for their food and other necessities. The chances are that many of them would starve; many of the children would die from malnutrition. Thank you Jonathan and Iweala for killing Nigerian children; you so loved Nigerians that you killed their children so that you and your friends, governors would steal more money.

The Nigerian working class would not be able to pay to have private means of transportation and would be forced to use public transportation.  There would be demand for buses, light rail, train etc. If pure economic thinking is our guide, resources would be reallocated to where there is demand. Thus, we would expect business men to go into the business of providing transportation to Nigerians; there would be buses, light rail and trains.

Businessmen are likely to invest their capital on buses and other means of transportation if there are good roads for them to drive them on.  Are there good roads in Nigeria?  And who invests on roads, private business or governments?

In America, with the exception of a few private roads (which folks pay toll fees to use) most roads are provided by cities, states and the federal government.

Would the various levels of Nigerian government provide Nigerians, especially businessmen wanting to invest in transportation with good roads?  Can you really imagine Nigerian governments building good roads?

I can imagine money being budgeted for road construction and those monies pocketed by the various politician-thieves in the country.  Perhaps, what is left of the moneys would be used to pour tar on the place where roads are supposed to be constructed and the first rains washes the tar away leaving giant holes where roads are supposed to be.

In such situations I do not see rational investors investing moneys to provide transportation to Nigerians.  Thus, the free enterprise system would not allocate resources more efficiently in the transportation industry of Nigeria.

Fuel subsidy means that the government is allocating money to subsidize the price of fuel, to make the price artificially low so that the average Nigerian could afford to buy it.  This means that when that subsidy money is withdrawn the government now has money in its hands to reinvest in other sectors of the economy.

There have been noises from several quarters of the government that the money to be saved from fuel subsidy removal would be redirected to infrastructural constructions (roads, bridges, schools, electricity, health etc.).  Really?

Do you really expect us to believe that the leaders of Nigeria can have access to money and spend it for public good?  If you expect people to believe this fairytale I have a bridge to sell to you. People behave in accordance with their history. The history of Nigeria is that those in governments appropriate whatever money they lay their thieving hands on. If the federal government saves money from fuel subsidy removal and gives that money to governors in increased monthly allocations for their states what would probably happen is that the governors would have increased money to redirect to their pockets.

So, how then is this fuel subsidy removal going to help the average Nigerian?  Why should the Nigerian people support it?

From a purely economic perspective, the removal of fuel subsidy probably makes sense; the government has no business subsidizing gas; the forces of the market are best at allocating resources. That being said, one is excruciatingly aware of the reality of a geographical expression called Nigeria. In Nigeria the country’s public wealth goes to a few hands.

The issue at hand is that the Jonathan government suddenly removed fuel subsidy.  Many Nigerians apparently do not like what the government did and have taken to the streets demonstrating against it.

I have paid attention to who is demonstrating against the subsidy removal. I have noted that it is mostly Yorubas and Hausas (at Lagos and Kano) that are doing the opposition to the subsidy removal. If they succeed all Nigerian would reap the benefit of their struggles. Igbos would benefit when the subsidy removal is rescinded.

If Igbos are going to be a beneficiary of return to the status quo ante, why are they not joining the effort to rescind the removal of fuel subsidy? Why are Igbos on the side lines watching other Nigerians fight for what would ultimately benefit them?

Igbos are not participating in demonstrating against the fuel subsidy removal because they are good capitalists who prefer that the forces of the market allocate goods and services but because of who they are.  Igbos are raised in a culture that socializes them to only work for the individual self. Each Igbo internalized a self-centered approach to the world.

Each Igbo person (I am generalizing; there are some exceptions to every rule) goes into the world to do what he could to survive. He is not concerned with other people’s survival or with the public good.  In so far that he is aware of the public it is to take from it.

The Igbos idea of government (“oru bake”, the white man’s work, not his work) is a place where he goes to take something from, not a place he goes to give something to.  If he could he would steal all the moneys belonging to the government and use that money on his individual needs (build houses in his village, buy expensive cars and generally masquerade as a very important man before his fellow Igbos).

The Igbo, as I see him, is totally self-centered and selfish. He pursues his interests with amazing diligence but does not evince interest in other people’s interests.

The Igbo would consider you a fool if you went to the streets to demonstrate against an unpopular government policy, especially if there is a possibility that you could be harmed. Instead, he waits for non-Igbos to go demonstrate and when what they worked for comes to fruition he would be the first to go take advantage of it.

In doing what he is doing, he fancies himself very smart. Actually, he is dumb; in fact he is not yet born to humanity and does not know it. He does not quite know what it means to be a human being. He does not quite know that to live fully is to dedicate one’s life to working for public good.

The heroes of mankind are those who worked for public good, not those who lived only for their self-interests.

History remembers only men and women who devoted their lives to serving their fellow human beings.  History forgets those who lived only for themselves, even if they were rich.

See, we do not remember any Igbo man or woman who lived a hundred years ago! That is correct; no Igbo person who died before 1900 is known to us today! That is to say that Igbos do not have history. They do not have history because they did not have self-transcending persons whose lives are worth remembering by future generations.

Past Igbos did not struggle for public good; they lived only for themselves and thus for all intents and purposes were mere animals.

Human beings though animals are different in that they work for their fellow human beings good and the outstanding ones among them totally dedicate their lives to the public good. History remembers those human beings who ignored danger to their lives and worked for the public, not individuals who worked only for their bellies.

I will be unequivocal: Igbos are totally self-centered and opportunistic; they seek what is in it for them but seldom what is good for the public?  They would not go out and fight and endanger their lives for public good.

Men who live only for themselves are not the heroes of mankind; they are the detritus of mankind. The troubling part of it all is that many Igbos do not even know that in the scheme of things they are garbage; they actually fancy themselves important because they stole money from here and there to seem rich and masquerade around as rich men. These days one way for them to seem rich is to kidnap their people and hold them random. Those kidnappers are now doing what their ancestors did: kidnap and sell their people into slavery. If the International community did not have laws forbidding slavery Igbos would today gladly capture and sell their people into slavery. They will do anything to make money and seem rich; morality and social interest is none of their business.

And these are the people who claim to be a superior breed of humanity?  They seem more like an inferior breed of humanity!

As an old adage says, the pursuit of money is the root of all evils, especially if that pursuit is in an environment where there is no morality and history of public service.

Folks talk about the success of American capitalism but actually capitalism succeeded in America because of the Christian environment in which it is practiced. The Christian religion teaches service to the public and gives the example of Jesus Christ as a man who dedicated his life to serving other people. Thus, though Americans are motivated to seek self-interests in their economic activities somehow they devote the fruits of their labor to the public.

Rockefeller, Ford, Carnegie, Mellon, Stanford, Chrysler, Alexander Graham Bell, Thomas Edison, Vanderbilt, Bill Gates and the other giants of American industry made profits and devoted their moneys to serving public good.  This tendency to redirect profit to public good is what has made capitalism seem to work in America.

In Alaigbo folks essentially live like predatory animals and only work for their personal good. In such a place can you imagine Igbos dedicating their ensuing wealth for public good?

If Igbo culture remains as it currently is I cannot see it producing men who give their wealth away to social service. What I see is the emergence of the rich and poor and many of the poor taking to stealing and kidnaping people to make a living. I see Somalia, that is, the breakdown of law and order and ensuing chaos and anarchy in the future of Alaigbo (unless, of course, Igbos culture is changed).

In a different paper I looked at Igbo voting behavior. I pointed out that when the typical Igbo person votes for candidates for political offices he seldom does what pure reason would expect him to do, that is ask: what is this person going to do for society when he gets to office. People who run for political offices have reasons why they seek political offices. Those reasons ought to include doing something for the people.

In the West political office seekers generally have political ideologies actuating them (liberalism, conservatism, socialism, communism, corporatism and fascism are some of the more familiar political ideologies). Each political ideology is a belief system on how society ought to be organized and what the proper role of government ought to be.  Liberals believe in using the power of government to improve the people’s lives (as long as the underlying climate is democracy and capitalism). Conservatives believe in limited government and maintaining the status quo of what worked in the past. Socialists and communists want to change society and bring about collective ownership of the means of production and property.  Corporatists want the state to work in conjunction with businesses for the good of the nation. Fascists want to use the state to achieve extreme nationalist goals.

The salient point is that rational voters have an idea of what they expect those they place in political offices to do for them; they fall somewhere on the political spectrum from left to right.  To the contrary, if you observe Igbos voting patterns  you find that they totally ignore what is rational voting behavior and vote for those that they are persuaded are “big men”.  That is correct; they would vote for a man solely on the basis that he is an African big man (a very important man) regardless of the fact that he presented no blueprint (platform) of what he is going to do for the people.

Igbos so want to become big men themselves that they admire those who seem like big men and vote for them to political offices. Of course, when such persons get to office they do not accomplish anything for Igbos. They had such shysters as Emeka Ojukwu; he was perceived as a very important man but if you ask: what did the man actually do for Igbos, the answer is zero!

Why would a people do such a silly thing?  It is because of their culture’s emphasis on being big men rather than on doing something right. The best way to characterize these peoples voting behavior is to see it as bush men’s behavior. If you called them Bushmen they would resent you (they fancy themselves civilized when they behave like Bushmen).

These people’s culture and characters need radical change. We do not need to patronize them and tell them that they are doing the right things; no, they are behaving in a primitive manner and need to stop doing so.

What would it take to change Igbo culture and Igbo people and make them public good serving instead of only self-interest serving?

The progress of Christianity probably would do the trick. In a couple hundred years Christianity would have become part of Igbos unconscious minds; their current me only psyches would have been replaced by devotion to we. Perhaps, at that time they would start showing interest in public good.

I see Igbos political behavior as motivated by self-interest. I do not expect this to change in the near future. I do not expect acts of heroism from self-centered persons. I expect to see attempts to cheat people from them.

Pathological cultures that produce antisocial people ought to be changed.  Alas, I am not a starry eyed idealist; I am a hardnosed realist and deal with people as I see them. I deal with Igbos as I see them: self-centered persons who do not engage in political action for public good. I leave it at that

DISCUSSION

In principle I am not against the removal of subsidy on fuel. In fact, if I was in Jonathan’s shoes I would have long ago removed it and allowed the market to allocate goods and services. But I would have also done many other things that Jonathon has refused to do.

I would have fought corruption.  I believe that corruption can be eliminated from Nigeria and I would do it.

I would have reduced the cost of government. For example, I would reduce the president’s salary to  twice the salary of the highest paid civil servant; I would reduce the salary of legislators to one and half of the highest paid civil servant; I would sell off all presidential planes and cars (except may be two).

I would reduce the states from 36 to 15 (1, Hausa-Fulani; 2, Igbo, 3, Yoruba, 4, Ijaw, 5, Edo, 6, Kanuri, 7, Gwari, 8, Nupe, 9, Jukun, 10, Maro, 11, Kaduna, 12, Ibibio, 13, Itshikiri /Urhobo, 14, Edo, 15, Tivi/Idoma/Ekoi/Igala/Igbira and minorities in the Benue Plateau area); reduce the number of local government areas. I would have each state self-supporting and not have to come to Abuja to seek money to run its affairs. I would have each state control all its resources.

I would have all Nigerians pay a flat tax of 20 percent to support the federal government; have businesses pay corporate tax of 20%.

I would have states have 20% sales tax on goods produced and sold in their states as means of support.

I would have cities and local government areas support themselves with property taxes, licensing fees etc.

I would have states provide publicly paid education to all children, from elementary to university; I would have states provide publicly paid health services to all persons living in them.

I would embark on massive industrialization of Nigeria which in ten years would make Nigeria an industrialized country.

I would embark on training people to subordinate their self-interests to social interests.

Jonathan is not doing any of these things that he needs to do but instead gave the people shock therapy by taking away the only advantage they seem to get from living in an oil producing country, subsidized fuel. He gave cockamamie reasons for doing so; he needed to have cushioned the effect of his actions by providing Nigerians with other services that they need.

CONCLUSION

Igbos would not participate in demonstrations against corrupt Nigerian governments and their policies; they will wait for other people to do so and then jump in to benefit from changed public policies. And these are the people who claim to be the supermen of the universe?

The saddest part of human history is that people do not see themselves as other people see them.  If only people would see themselves as they come across and learn to serve social interests rather than live only for their individual bellies (bellies which are food for worms).

No extant Igbo, from their governors to individual Igbos, is currently considered a person with national and or international leadership abilities; they are seen as little greedy men working for their pockets, not for the good of all mankind.

PS: There is a reason for my talking about Igbos.  By pointing out Igbos negative aspects one is, hopefully, helping them to understand themselves and redirect to more socially appropriate behaviors. It is those who are engaged in social, political action that are fully alive.  Igbos sitting on the side lines, angling for safety and security, while boasting about their phantom superiority to other people is silly; it is those who expose their lives to danger that if anyone is superior are superior folk. If you are self-centered try becoming socio-centric in your behaviors; it is actually the most fulfilling way to live. The narcissistic and self-centered person is the most lonely and unhappy human being on earth, although he does not know it. He keeps pointing accusing fingers at other people for what they did to make his life difficult. All he needs to do to make his life pleasant is to love and respect himself and all people and work for our mutual social interests.

Ozodi Thomas Osuji

January 12, 2011

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Ozodi Osuji Ph.D

Ozodi Thomas Osuji is from Imo State, Nigeria. He obtained his PhD from UCLA. He taught at a couple of Universities and decided to go back to school and study psychology. Thereafter, he worked in the mental health field and was the Executive Director of two mental health agencies. He subsequently left the mental health environment with the goal of being less influenced by others perspectives, so as to be able to think for himself and synthesize Western, Asian and African perspectives on phenomena. Dr Osuji’s goal is to provide us with a unique perspective, one that is not strictly Western or African but a synthesis of both. Dr Osuji teaches, writes and consults on leadership, management, politics, psychology and religions. Dr Osuji is married and has three children; he lives at Anchorage, Alaska, USA.

He can be reached at: ozodiosuji@gmail.com (907) 310-8176