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Economic Opportunism By Peter Alexander Egom
Days of sharp and long knives are here. So, watch your sides, your front, your back and even the air above you as well as the very ground on which you walk. No one is safe anymore from anyone. Nigerians, by and large, worship at the altar of Mammon and do go on to taunt God with their raucous religious hypocrisy and this is precisely why our economic mess compounds itself by the day.
For, if the millions of Nigerians who today claim to be Christians and Muslims were sincerely true and faithful to their confessions, would there not have emerged in Nigeria the critical mass of staunch and ecumenical people of God to bring down, through fasting and prayers, the justice and peace of God upon the whole land so that we may become citizens all and subjects none in Nigeria, this amazingly endowed heartbeat of the black race? There, surely, would. But here we are full of deceitful and heartless talk and hardly ever loyal to any act of intellectual or spiritual faith because we are opportunism writ large; and this is why we are so loudly as empty as empty can be.
Indeed, we are mostly walking accidents of dishonesty: intellectual, spiritual, material, social, etc., primed and waiting to happen at the one or the other feckless instant. We are, thus, children of the impending doom and chaos because we mostly do not care to have any discernible and unchanging handle to life. And, this is why we mostly live a stinking lie and, of course, we die a stinking and miserable lie. Can you beat this?
In fact, nothing can better tell us Nigerians that strange and entropic days of crass opportunism and ethical relativism are here with us than the quite surprising short-shrift which Prof. Charles C. Soludo’s hare-brained naira redenomination plan received in the hands of those Nigerians who one, with a large measure of truth, could call his intellectual and economic policy parents in Nigeria. Such are Dr. Kalu Idika Kalu, Dr. Chu Okongwu, Chief Olu Falae and other like-minded intellectual and economic policy magicians from the hey and inglorious days before September 26, 1986, when the floating rate variant of the currency board debt standard, otherwise known as the SAP, arrived to stay in Nigeria. Was it not these gentlemen, with Chief Omowale Kuye and Alhaji Abubakar Alhaji, (Triple A), in tow, who terrorized the whole country with the saying that there is no alternative (TINA) to SAP! These were, indeed, the men. And they eventually got their way on that dark day of September 26 1986 and we Nigerians, in return, got our woes of the past two decades of starvation, disease, death and embarrasing ethical disintegration in the form of the ubiquitous and chameleonic 419 business. For hell hath no fury than a naira emptied of value and mismanaged by the SAP!
It follows from this that Soludo’s naira reform plan could only, with decency, be critiqued by these floating – rate SAP incubators of 1986 if it was so that they did not know that their floating rate variant of the SAP also has a fixed rate variant or sibling which Mr. Soludo proposed for Nigeria on August 14, 2007. And if they did not know that their own floating rate variant of the SAP also has a fixed rate variant, then what was their business being in office in 1986 as the seasoned and knowledgeable helmsmen of Nigeria’s economic management? Ask them!
What is certain is that our economic managers who led us to the desert land of the SAP in 1986 were not and are not rounded masters of the theory and practice of money and, either by omission or by commission, they allowed the West to get Nigeria back on the slippery path of economic re-colonization through their floating rate variant of the SAP. And once Nigeria found itself once again on the open colonial market train it was only a question of time before another SAP enthusiast like Mr. Soludo would conclude Nigeria’s journey to economic re-colonization by springing the fixed-rate variant of the SAP on Nigeria. And this is precisely what Prof. Charles C. Soludo did to Nigeria on August 14, 2007. So, by coming out to make short-shrift of the Soludo plan, Dr. Kalu and his class of 1986 also made short-shrift of their own reputations as full-fledged, patriotic and down-earth economists. The floating-rate economic kettle has no business calling the fixed-rate economic pot black. For, they are all the neo-liberal merchants of the economic variant of St. Vitus Dance – the dance of economic disarray, morass and death.
I know that Dr. Kalu will hurry to say that I am talking arrant nonsense, but this, I am afraid, is very far from being so. For on page 146 of my book of 2004: NEPAD and the Common Good, I had this to say about how to get the management of the Nigerian economy right:
“So, two things must be done to get the Nigerian economy back on its feet. First, the domestic public debt mass must be liquidated and no tier of government in Nigeria may contract any form of domestic debt as government business will be conducted only on cash basis in the manner of Dr. Kalu Idika Kalu’s Imo Formula of 1984-1985. And, second, the international reserves of Nigeria must be kept at home in Nigeria in the form of above-ground and underground gold reserves. In other words, as soon as the naira goes onto the gold commodity standard so soon will Nigeria be on her way to a blazing recovery into growth”.
Now, the point I repeatedly make to Dr. Kalu whenever we run into each other these days is that if he had been privileged to do his Imo Formula at the federal level in the Nigeria of 1986, he would either have led Nigeria back to the colonial fixed rate currency board debt standard of the Soludo variety or straight to the gold commodity naira of the gold payments standard. Dr. Kalu has not come out to tell me where he always wanted to take Nigeria in this regard.
But, I now tell him that his Imo Formula is exactly the Soludo colonial plan at the federal level. Why is this so? Simply because Dr. Kalu has not, on any occasion in man’s memory, argued for the total elimination of the interest phenomenon in the structure of financial intermediation in Nigeria through the total liquidation of the Nigerian domestic public sector debt mass and, thus, for the elimination of the Nigerian public sector borrowing requirement, PSBR, and, importantly also, for the establishment of a Nigeria-wide network of naira-trading commodity exchanges for gold, oil, grains, cassava etc, etc. It is this domestic environment of equity finance in Nigeria’s financial intermediation that, inexorably, would create the inward-looking, gold convertible and good servant naira. But this is not what Dr. Kalu’s Imo Formula is all about. Rather, the Imo Formula would sustain the peripheral and extractive capitalism of NEITI in Nigeria with the aid of the fixed rate colonial convertibility of the bad master naira.
In other words, the SAP has a floating rate variant and a fixed rate variant as well. Dr. Kalu’s Imo Formula of 1984 – 1985 is the fixed rate variant of the SAP at the federal level and is, therefore, the same as Mr. Soludo’s naira redenomination plan. So, how can Dr. Kalu and Company, who introduced the floating rate variant of the SAP to Nigeria on September 26 1986, now turn around to excoriate, in August 2007, their dutiful, logical, intellectual son, Prof. Charles C. Soludo, for doing what an obedient, loyal and intellectual son should do by carrying out the economic thought and action plans of his intellectual BABAS to their logical and colonial conclusion? If you ask me, I would say that this form of intellectual atilogwu dance on the part of Dr. Kalu and Company is the bane of sound economic management in Nigeria. They find it extremely difficult to walk the domestic economic talk of equity finance because they are so easily distracted by the sweet, but deadly, and usurious talk of debt finance.
In fact, these gentlemen owe Prof. Charles C. Soludo loads of heartfelt apology for having failed to recognize the fact that in Soludo’s American Wonder one, indeed, finds the fixed rate variant of the mess of an economic policy plan which they foisted on Nigeria on September 26 1986. Intellectual arrogance and error begets intellectual arrogance and error. It was the intellectual arrogance and error of September 26 1986 that gave birth to the intellectual arrogance and error of August 14 2007. This is the legacy of the ethically barren and mechanical mumbo – jumbo of the neo-liberal Washington Consensus which is the ideological pedestal of the SAP. Soludo is descended from these Nigerian official purveyors of this ideology in 1986. And as a dutiful son, Soludo has done extremely well to carry the barren ideas of his intellectual parents to its logical and colonial conclusion. Are these not very strange days of sharp and long knives where intellectual kinsmen, fathers and sons for that matter, are daggers drawn with each other over nuances of the same ideological and economic jagaa – jagaa? Na waa – o!
But this is not all. For it is on the record that in late August 1987, the Nigeria which was then under the economic watch of the floating-rate SAP enthusiasts like Chief Olu Falae, Dr. Chu Okongwu, Alhaji Abubakar Alhaji, - (Triple A), Chief Omowale Kuye and Dr. Kalu Idika Kalu gave the sack ,on the grounds of irreconcilable differences, to two top parastatal banking executives in the persons of Prof. Ibrahim Ayagi, at the defunct Continental Bank, and Oba Oladele Olashore, at First Bank, for having the truthful guts to say that the SAP has no human face and, besides, that its economic rationale does not quite add up – in local lingo, we would say that the SAP dey one kind! Then some ten to twelve years ago, Prof. Sam Aluko, my good friend Dr. Charles Njoku and myself got an ear-full of a tongue-lashing from Dr. Kalu Idika Kalu. For in a full page and self-eulogising interview, in the Guardian newspaper, he called us this and that from Cambridge and Harvard who had the impudence to say in 1986 and thereafter that their floating rate variant of the SAP is the same as a plan for economic genocide. We were obviously in the right, no matter what Dr. Kalu may say about us, because just one look at the stinking open sewer that Lagos has become since 1986 tells all the story about the dehumanizing properties of the SAP. Perhaps Dr. Kalu does not see that with time and with the SAP Lagos has become a pen for animals rather than a habitat for human beings.
But, this is not really the point here. Rather the point is the wonder of wonders that did happen in August – September 2007. Prof Sam Aluko, Prof. Ibrahim Ayagi and myself found that we had the quite uncomfortable company of Dr. Chu Okongwu, Dr. Kalu Idika Kalu and Chief Olu Falae in making our different cases against Soludo’s fixed rate variant of the SAP! How times and minds do change! However, one thing is as clear as clear can be. Neither Prof. Sam Aluko nor Prof. Ibrahim Ayagi nor myself is either a floating rate, or a fixed rate, SAP enthusiast. We have kept faith with what we thought of SAP in 1986 and thereafter. But this much one cannot say for Dr. Kalu Idika Kalu, Dr. Chu Okongwu and Chief Olu Falae.
This form of intellectual opportunism which the proposed Soludo naira reform plan has thrown up in Nigeria is also evident in the economic management of most African economies. So, let us for example, look at the economic woes that have befallen Ghana, our Anglophone neighbour, since 1984. It came, for those of us like the late Prof. Claude Ake, Prof. Okwudiba Nnoli, Prof. Osita Eze, the current DG of the NIIA, and myself, who were the professional contemporaries of Dr.Kwesi Botchway at the University of Dar es Salaam in the early mid nineteen seventies, as a very rude shock for us to learn that this middling law don at the Law Faculty of the University of Dar es Salaam, who had this disconcerting way of babbling some Marxist inanities and clichés, which every one knew he did not believe in, was transformed in the early nineteen-eighties into the seemingly cracking economic gu-guru of Ghana! It was in Kwesi Botchway that the IMF and the World Bank found the human conduit for getting their SAP policy of economic genocide into Ghana. Thus was it that, from 1984, Ghana began its own St. Vitus Dance of economic death.
At this time the Cedi exchanged at the rate of 2.75 to one US dollar. But by July 2007 many thousands of Cedi exchanged for one US dollar. And we glean from the experience of Ghana, from 1984 to 2007, the cast-iron procedure which the IMF and the World adopt in worsting the currencies of African economies into the total subject-hood of colonial convertibility. First, they get African economic opportunists to use the floating rate currency board debt standard to de-industrialize the African nation completely. And second, they get African economic opportunists to use the fixed rate currency board debt standard to return the currency of the African nation back to the colonial convertibility of a CFA Franc or a Hong Kong dollar. Ghana completed this procedure in July 2007. And this was what Nigeria, according to Soludo, was billed to conclude come August 1, 2008.
Thus, one must not overlook what the re-denomination of the Cedi in July 2007 stands for in symbolic and practical terms. Symbolically, the West took their revenge on the name and ghost of Kwame Nkrumah who had the temerity of destroying the fixed-rate Anglophone West Africa Currency Board in July 1957 by creating the Cedi and withdrawing it from this West African fixed-rate currency board debt standard. But fifty years on, precisely after Botchway’s Judas’ economic programme of de-industrialization had led to the total destruction of the infant industries of Ghana, the Cedi was returned to colonial and fixed-rate currency board debt standard with the currently reeling and bottomless US dollar as its anchor! It is as if Kwame Nkrumah had not lived and worked so hard for the political, economic and, above all, spiritual, emancipation of the black race now that the West is fully in charge of Ghana’s economy all over again.
And practically, the Ghana of Kwame Nkrumah which had upset the colonial currency applecart of the West African Currency Board in July 1957 would, 50 years on, become the Anglophone West African nation to re-introduce the fixed- rate currency board debt standard to the West African Anglophone nations. This is precisely what the re-denomination of the Ghanaian Cedi in July 2007 was set to do. Of course, after the Cedi, the next victim of this re-colonizing monetary rout of West Africa by the West was naturally to be Nigeria come August 1 2008. Such was and is the plan for the birthing of the ECO Common Currency as forged by the hired minds of the African economic opportunists at the West African Monetary Institute, WAMI, at Accra, Ghana. Quite a whammy lot!
However, as they say, man proposes but God disposes. For God used President Musa Yar’Adua to save Nigeria from the grabbing hands of the West. Yar’Adua saw through the colonial trap in Soludo’s naira reform plan and said an emphatic BABU to it. Nigeria will no longer be subject to the debt financing excesses of the West’s economics of apartheid.
What lesson do we, then, learn from the above? That we must look everyone of our so-called African economic experts very closely in the mouth. For intellectual opportunism seems to have eaten deep into their minds and marrows. Thus, any African economic expert who claims that debt finance at home and abroad is the path to Africa’s economic emancipation must be seen as the colonizing agent of the West. But any African economic expert who says that equity finance at home and abroad is the narrow road to Africa’s sustainable growth in social and material plenty, is the true intellectual heir or heiress of Kwameh Nkrumah, Sekou Toure, Julius Nyerere, Amilcar Cabral and the other great African liberators.
Thus, the message of economic life in any society of any scale is job, food and social security for the people. And the messenger of economic life in any society of any scale is money. However, economic opportunism does not subscribe to the idea that money should work, with increasing returns, for the people, rather it says that people should work, with diminishing returns, for money. Accordingly, economic opportunism describes the mind-set of the African economic mercenary who, in the service of the West, pied-pipes his people, through debt finance, into the slavery of the floating-rate and fixed-rate currency board debt standard.
For, where the domestic and foreign debt financing regime in Africa causes the dislocating and massive rural-urban drift of resources in Africa, the domestic and foreign equity financing regime in Africa arrests and reverses the rural-urban drift of resources as it makes rural and cottage entrepreneurs of most Africans. More specifically, it is the equity financing regime of micro-finance-banks, MFBs, which arrests and reverses the flow of resources: human, material and financial, from the rural areas of Nigeria to its urban areas. And the market framework which enables MFBs to create a de-centralized structure of economic enterprise in Nigeria is the country-wide and electronic network of back-to-back stock and commodity exchanges.
In effect, Nigeria shrinks today in home-made jobs, goods and services because the country labours under the debt financing regime of the bad master and interest-based variant of the naira. But Nigeria will grow and grow tomorrow in home-made jobs, goods and services because the country will be woven together, in work and reward, by the emerging equity financing regime of the good servant and interest free variant of the naira. And this is, indeed, the financial secret of, and the open sesame to, the phenomenal growth of Nigeria in social and material plenty which will soon follow in the wake of the imminent roll out of RIROMAN, Rural Industrialization Roadmap for Nigeria, the electronic market development and management programme for Nigeria.
Peter Alexander EgomConsultant Academic Editor NIIA, Lagos E-mail: pegom@niianet.org
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