As Global Prices of Crude Oil Drops What Should Nigeria Do

In Shock Doctrine, Naomi Klein argues that each catastrophic condition is an opportunity to press the reboot button.  While she argues that the neo-conservatives have used many of the world catastrophes to push their ideas of capitalism, which she describes as disaster capitalism.  Nevertheless, it’s important to recognize this phase to press the reboot button.  She points to disasters from the Noah’s flood to Iraq war and Katrina in the US—and, that changes after each of these disasters have mirrored the ambitions of dreamers and thinkers.  I am not sure if she cited to the fires in Rome and Paris during the times of Emperor Nero and Napoleon respectively, as examples where both leaders have used the catastrophes to embark on major construction and architectural projects in the respective cities.  But if she did not, these are typical examples to emphasize her shock doctrine.

I am thinking of the current drop in the world oil prices and its effect on Nigeria’s economy.  Whether the drop in revenue is enough catastrophes to shake Nigerians into pressing the reboot button, is an open question.  Would Nigerians reflect and challenge our autocratic culture for a more democratic system, is equally an open question.  What is not open to question is the hardship that the drop in the world oil prices shall present.  Also, the current democratic system is not open to question, as Nigerians understood that more democracy is better than less.  So, how should the next government tackle the economic hardship?

Two independent experiences should point to a way forward for any incoming government.  First is the 2012 removal of petroleum subsidy and, second is Buhari’s handling of the bleak economic condition of the early ‘80s.

In his New Year message to Nigeria in 2012, President Jonathan unceremoniously removed the subsidy on petroleum products.  He cited, unconvincingly, to how the subsidy negatively affected the economy.  Nigerians went out en masse to protest against the policy.  Weeks of demonstration that threatened the country forced the government to make changes.  On the other hand, the government of Buhari encountered a massive deficit, dwindled foreign reserves and oil revenue, left behind by the Shagari’s administration.  IMF advised a set of harsh economic conditions in Nigeria that, at the time had never been practiced anywhere before.  Buhari, with advice from the SMC, refused to bargain or play ball, and the economy stagnated.  The subsequent government of Babangida cited to the failure of Buhari to negotiate with the IMF as basis for the change in power.  So, in light of these two experiences what should an incoming government do?

First, the next government must be sincere with Nigerians—the government must explain the true nature of the economic challenges to all Nigerians.  The president and his team must be able to mount a fresh campaign throughout Nigeria to reveal the fault lines of our fiscal and economic problems, and how both of these affect our system of government.  As it currently stands, the ratio between our recurrent and capital expenditures is highly in favor of recurrent expenditure, and this has to be reversed.  Also, the Federal government assumes too many roles that ought to be handed to the States.  Finally, the cost of running our democratic system is over exaggerated and must equally be addressed

So, as priority, an incoming president must be prepared to challenge the enormous waste within the presidency.  The presidency could do without the massive State House Medical Center (SHMC), with facilities for post mortem, embalmment, CT Scan, ambulances and many others.  The National Medical Center in Abuja can perform these functions.  Also, the various presidential lodges in Abuja and Lagos, including Dodan Barracks and State House at Marina should be disposed.  As an after-thought, EFCC, Bureau of Public Procurement (BPE), Bureau of Public Enterprises and others must be removed from the presidency and reconstituted into independent agencies or under existing agencies.  And, this list is just a tip of the finger.  The president must be prepared to redefine the office of the presidency.  It should be lean and muscular.  In 2012, the Jonathan administration failed to convince Nigerians why it was important to remove the petroleum subsidy, in part, because Nigerians did not see an equal commitment from the government to address wastes.

Next, the president must confront the legislative largesse in ways to avoid any institutional conflict.  A similar campaign, to educate Nigerians on the true nature of the economic challenges, must be waged against legislative wastes.  There is no justification for legislative security votes.  National Assembly clinic, like the SHMC, should be reduced to providing mere first aids to legislators, and not a full hospital.

Last, the president must be prepared to work with the legislative bodies on restructuring the huge Federal government bureaucracy.  The number of ministries is insane.  There is no need for an independent Ministry of Aviation separate from the Ministry of Transportation or the Ministry of Women Affairs, Culture and Tourism, Niger-Delta, and others.

In many areas, Nigeria is on the right track, but the huge disparity between the recurrent and capital expenditures stunt progress.  First, many of the ministries under the Federal government are a mere conduit for wastes and fraud, and at best, salary disbursements, and without any appreciable money for capital expenditures.  This phenomenon has to be reversed.  The States need to see a well-run Federal government, and a president could provide fresh leadership in this area.  Nigerians are matured and will support any leader that understands that leadership is a bond between the governed and the governor, and not in anything physical or cosmetic.  Our democracy will thrive better when our elected officials develop the necessary bond with the electorates.

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