What lessons can Nigeria learn from Obama’s handling of the economic crisis which he met as he entered office? First, he inherited a situation which in actual fact predated President George W. Bush because the economic expansion ended when George Bush assumed office.
Obama preferred to avoid the long knife to cut off social programmes and inflict more pain on ordinary citizens.
Rather, he made generous provisions for everyone from the super-rich to the unemployed. In Nigeria the President removed outstanding subsidy in the petroleum sector in one fell swoop. Governments before did it piecemeal which generated a piecemeal impact on the economy. Subsidy removal on petroleum products bites the poor far more than the rich. And are we unaware the President has dropped N-Power, attempted to withdraw the few kobo universities use to buy chalk, has proposed to impose tax on small and micro businesses, and plays games with palliatives?
Second, theories do work in real life and those found to have worked should be applied as appropriate. At no time in world history did the world experience the kind of economic downturn of the 1930s. Keynesian economic theory worked, led to reversal of the bleakness and positive fallouts such as the Bretton Woods Agreement and system came into being. The latter gave birth to such international institutions as the World Bank and International Monetary Fund.
This raises the issue of square pegs in square holes with respect to persons with cognate experience to hold critical national offices. Henry Paulson as President Bush’s Treasury Secretary crafted the TARP which saved finance giants such as Fannie Mae and Freddie Mac along with others such as American International Group (AIG) and Lehman Brothers. Barack Obama extended the TARP when he entered office. Between 2008 when bailouts commenced to 2010, $426.4 billion given out at 5 percent interest went back to taxpayers plus profit of over $11 billion.
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Dr. Goodluck Jonathan brought back Dr. Ngozi Okonjo-Igwuela into the finance portfolio. Among other things she revalued the national economy which made Nigeria’s economy the biggest in Africa. This act had a wide range of implications which I believe the country will continue to benefit from in the years ahead. What would have been out of place if her successor, a woman, used fiat to make Naira to dollar rate more humane? Someone may want to pooh pooh the idea but if the Minister made an attempt the world would have latched on. President Richard Nixon dumped the Bretton Woods system by fiat and the world moved on. Foot dragging on the Dollar to Naira parity results in the main from perceived losses by bigwigs with large dollar holdings just as the power sector suffers because of the stranglehold of importers of generators and related technology. The Almighty will visit these selfish persons who hold Nigerians to ransom.
Third, Nigeria has no reliable data but we live with our families and neighbours and we know the country has an army of unemployed and underemployed persons. Let someone point to one bill on job creation where Executive or private members of the National Assembly present legislation on the unemployment crisis in Nigeria. By September 2011 the American Jobs Act went into force to focus on job creation. Rather than sign an unpopular outstanding bill on Student Loans packaged by the President’s Chief of Staff, President Tinubu should have urged the National Assembly to work on a jobs creation bill in his first 100 days.
Fourth, governments in Nigeria are notorious for rejection of anything done by a former administration. The Kano State government spent its first week to pull down structures completed by the immediate past administration. In Akwa Ibom State Governor Emmanuel completed an abandoned building at present used by the Ministry of Works. In another year he joined others to go for the new and at the end of eight years he left a litany of uncompleted projects which has made his successor to face fire because of an attempt to put some ‘completed’ projects back into his budget. President Obama accepted TARP and granted more loans to two auto giants in trouble. Before his first term ended those companies paid back the loans with interest.
It will take time before the sordid sides of the palliatives of the present government at various levels come to light. Somewhere in Rivers State we hear a youth chairman has disappeared. Palliatives by way of a few cups of rice amount to deceit which God cannot be pleased with. Palliatives should be consistent such as N-Power although it makes some youths lazy.
Fifth, what has the Federal Government of Nigeria done with the subsidy removed? Few Nigerians are aware of the background of N-Power which President Jonathan initiated. Under the title SURE-P (Subsidy Removal on Petroleum Products) managed by such giants as Christopher Kolade of Unilever fame, the dual carriageway from Port Harcourt to Eket came into being as part of the East-West super highway. In the eight months of Tinubu after 100% of subsidy went with the wind, we hear National Assembly members going for weekends with millions of Naira for dinner. The same group received N160 million each to buy imported SUVs for monitoring. Innoson Motors SUVs will tear the starched clothes of royal lawmakers. Well, Nigerians await the controversy on padded 2024 Federal Budget despite the suspension of the “whistle blower.” Obama’s policies reached every citizen, from tax cuts to bail outs to health known as Obamacare.
Sixth, if painful pills are administered it should go round rather than being targeted at the poor. Both TARP and the Recovery Act stopped executive privileges and bonuses rife in the private sector. Imagine a Nigeria where Federal lawmakers collected money for weekend special food (pigs should eat apples as George Orwell noted). The Presidency budgeted for a yacht and a backlash came, the longsuffering Nigerian Navy covered it. Richard Quest would describe our national folly as a world of wonder.
What should we regard as the way forward in this comparative review? President Tinubu should set up a think tank with honest, qualified, and experienced people as members. They should review the approaches adopted by President Barack Obama to revive the collapsed American economy between 2009 and 2016. Nigeria has no need for ‘experts’ or consultants to be imported for in-depth study of the Nigerian economy for what destroys the kola nut lives inside the kola nut and the owner of the plantation knows the insects. We know our problems better than the best consultants anywhere in the world. And when the team makes recommendations the President should struggle to carry them through despite the stranglehold on the economy by the super-rich. If he shifted the Central Bank of Nigeria Governor Emefiele without fuss and made an attempt to get the monetary system to work, more can be done.
In particular, let President Tinubu carry everyone along – the super-rich, the middle class, and the poor. At present his policies and actions are lopsided in favour of the super-rich. If Obama favoured everyone and succeeded, yes, we can. The structures are different by a wide margin but those who know what to do can do something to reposition Nigeria for growth and comfortable living in a utilitarian framework of the greatest good for the greatest number.
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