By

Mike Ikhariale

It is certainly with great embarrassment that one discusses the now perennial shortage of petrol and related products in Nigeria. If one realizes that the same Nigeria is certified as the sixth largest producer of crude oil in the world and it is also only in that same country that the supply of petroleum products has remained agonizingly inaccessible to the citizens, my source of embarrassment becomes self-evident. I recall, twice in Lagos, I had had to sleep at filing stations, holed inside my car, with my family hardly aware that ‘I have gone in search of the golden fuel’ only to come back home without a drop of petrol to show for my forced absence from home. It is nightmarish, to say the least. Not to have the needed fuel to run the economic system in a society supposedly with a government in office, to put it mildly, is the very definition of a failed state. In this connection, the Federal Republic of Nigeria is fit and proper candidate for the label of a failed state or at the very least, failed governance.

For years now, the supply of petroleum products has remained inadequate and the little that is supplied to the market is further diverted into the black market by very powerful government officials and their proxies in the oil industry. In the process, a few strategically placed persons have made a fortune from the resultant misery of the ordinary people of Nigeria. As the Edos are wont to ask: How can a child have his mother in the kitchen and still remain hungry? Nigeria as a nation, may lack everything but certainly not fossil fuel which she has in abundance. If indeed a government, like any human parent, were expected to take into account the welfare of its children, in light of what we have suffered over the years in Nigeria, our governments would be earning the unusual distinction of willfully starving her children to death in the midst of plenty. The misfortune of our people so far is that they are saddled with regimes that take pleasure in spreading agony and maladministration. If citizens did not find the military tolerable, they ought to be at least hopeful with the new civilian democracy. But everything seems to be turning into a mirage, what with the we-know-it-all attitude of officials of the regime.

To our collective chagrin, we have since found out that contrary to the general understanding, what we had all along taken for governments in Nigeria in the past were really something in between sheer banditry and wanton vandalism, for only a vandalistic regime in an oil producing society would indolently watch the gradual dilapidation of all its oil refineries (four in all) which the nation had built to meet the oil needs of its citizens in preference for massive importation of finished products, which are at times toxic and inferior, at great costs to the national revenue simply because this clearly deranged line of action enhances the personal balance sheet of a few individuals in government. And of course, it is only regimes that are motivated by the logic of banditry that would deliberately opt to kill her national economic foundations like energy supply, so that their henchmen could embark on the reckless importation of the same commodity upon which the national economy is precariously founded. It was therefore all right for the military regimes to kill the nation’s domestic capacity in oil refinery as long as the bank accounts of the Generals and their cronies were getting stuffed with the criminal proceeds from the wholly unpatriotic transactions. It is easy to see why the military regimes did not give a damn to the plight of the people of Niger Delta at whose cost the oil was been extracted because they saw the commodity as an item of loot and it is not normal for thieves to consider the plight of the owner, in most cases they kill him. If it did not cross their shallow minds that they must maintain the refineries, it certainly would be impossible for them to take into account the feelings of those on whose land this money-spinning product is been obtained. Needless to point out the tickling time bomb which that criminal neglect has become for the nation today.

Obasanjo did not start the rot. This was already the state of affairs before the present democratic government came into power. So in all fairness, the deplorable conditions of fuel supplies in Nigeria have since become institutionalized as a solid sub-sector of the booming black-market which Abacha and his ‘Lebanese’ economists had perfected. No one can therefore blame the present government for solely causing the lingering shortage of fuel. The blame of this regime is however in its wholesale adoption and reinforcement of the old anti-people military philosophy of jacking up prices whenever the government is in short of cash due to unbridled squandermania. Any one who is serious about developing the Nigerian economy must start with the energy sector in which petroleum product accounts for the lion share. The talk about industrialization and commercial development even at the most rudimentary levels would be a pipe dream if energy supply, electricity and gas, are made too expensive for the indigenous industrial beginners. Even for the so-called well-established enterprises, unreasonably high overhead costs would make their products uncompetitive at the end of the day, a veritable recipe for industry wide bankruptcy.

The assumption here is that as a democratic government, it would want to earn its electoral mandate by doing those things that would be to the benefit of the citizenry. Consequently a rethinking of the embarrassing oil situation was considered inevitable for the post-Abacha administration. That, of course, has proved to be a tragic mistake as the regime change of May 1999 appears now to be merely superficial as the brain and soul of the old order have all endured till this day at Aso Rock. The revival of the old but bane official arguments about the ‘correct pricing’ of the petrol sold in Nigeria is a clear confirmation that even thought the orchestra has changed the music remains the same; just the same way the defunct Abacha oil bunkering administration pushed the silly contention of removing subsidy from petroleum products so that the pump stations will be overflowing with supplies, the present government has, without let or hindrance, dusted up the same lazy and voodoo thought process to want to justify the undeserved raise in the pump price of oil products in Nigeria.

There is no doubt that at the purely superficial level, the pump price of oil in Nigeria is lower than, say as it is in the United States. The question is: Is the Nigerian government about to start giving to Nigerians what the US government gives to her citizens? If we did not wreck our refineries, would there have been any reason in the first place to be haggling about the need to import petrol with hard currency?. Why don’t our official compare likes with like, say, Iran, Libya, Saudi Arabia, Kuwait, etc.?. In all probability, we should instead have been selling some of the excess finished products today if we were not insane . Unfortunately we are shamelessly haggling about the price of the finished product from those we had earlier sold the crude to at the price of peanuts. Why would the government then shift the burden of its incompetence and greed to the hapless citizens? It is so easy for our vampire administrators to compare the price of our petrol with mud water. Why doesn’t this shameless official ‘ojoro’ analysts also compare the income levels between Nigeria and those of their favorable foreign countries? It is immoral for the government to want to penalize the common people for the economic crimes of the leadership.

The United States with whose dollars we seem to now prefer to calculate our pump prices, for example, is a major producer of food. Accordingly, like any responsible government, it heavily subsidizes the price of food for its people. The result is that no matter how poor you may be in America, any amount of money in your pocket should guarantee you a decent meal. In fact, if by chance you have no dollar in your pocket at all, the State has ensured that you do not starve as a result of poverty as it provides what the Americans call ‘Food Stamps’ with which the penniless in the society can collect food from any grocery shop free of charge! This arrangement cannot be anything but unlimited subsidy. Social result: The people are happy and the real ‘dividends of democracy’ are evident on the family dinning table. It ought to be commonsensical for any Nigerian government, aware of the massive destruction of the national economy by the vandalistic military juntas of yore, that for the economy to truly take off again, the availability of cheap energy in the form of petrol and diesel ought to be an official priority, a condition sine qua non in the national revival plan. Alas! All we hear about is how to increase on the quantity of the available expendable cash (no talk about its value) that the corrupt officials will again brazenly allocate to themselves.

Is not political suicide for an elected government at this day and age, whose officials are feeding fat on the little that is in the national coffer, to still be calling on the electorate to cough out their little hard earned money with which to satisfy the gluttonous tendencies of those they had elected into government? It is perhaps true that there is a theory developed at Aso Rock that the more you oppress Nigerians the more they notice the presence of government, the more they want of the leader. They quote the experiences of both Abacha and Babangida for practical examples. The government failed to realize, and quite woefully too, that after spending so much of the nation’s money on meeting the extravagant personal needs of the Legislators and the innumerable members of the Executive and ubiquitous party hangers-on, that there would be little left to pay workers’ salaries much less with which to carryout any meaningful social and economic development projects. It smacks of sheer laziness of governance for the government of Nigerian to always want to fall back on the only resources it controls to levy the masses in the name of price hikes just to fund its unlimited wastefulness. What the call for increases in the prices of fuel amounts to, in the circumstances of Nigeria, is cruel LEVY on the poor and dispossessed to fund the appetite of the rich. It is arrant nonsense, on a proper analysis, to continue to harp on the inevitability of price hike when there are several creative options to revenue generation accompanied by legitimate wealth creation. Instead of thinking on how to increase on the productive capacity of the national economy, we are enthroning laziness and the self-destructive option of raising petrol prices at every turn with no regard to the usual debilitating impact on the economy in the form of runaway inflation and the incapacitation of the production inertia of the endemically declining economy.

Some people have reasoned that the only way the government can pay it workers after the officials have eaten (culled from Ige v. Afolabi) what was available in the coffers, apart from the usual ‘sack sack’ mentality which is naively expected to cut costs, is to impose a higher tax regime on the people. In plain language, they are actually forcing the people to start subsidizing corruption and official inefficiency by imposing unusually high prices on all services or product the government provides. That explains why government rates and charges in Nigeria are usually altered upwards as irresponsibly as possible. And that is what the labor union is saying but clearly in a different language.

It is obvious that the government is not sincere about deregulation because that would force it to fall back only on taxation as against the present possibility of the punitive levy which unfortunate and ordinary Nigerians are being made to pay in the guise of ‘correct pricing’, just the same thing Abacha told us, Babangida and those before him also told us with no positive result. A little creativity on the part of the government would probably have coined out another terminology for this ‘authority stealing’ (apologies to Fela) but, too bad for the nation, the tune had been the same all along. Did anyone expect Gerry Gana to have democratized his chants or Philip Asiodu to condescend to want to pick up the new edition of economics 101? So we are stuck with officials still very much in love with the political medicine of the debased Abacha years.

We must have the political will, ethical energy, and perhaps humility, to face up with the challenges of privatization but certainly not the fraud and charade that are taking place currently. Government must not be allowed to continue to levy the people to fund its kleptocratic instincts. What we call deregulation so far is the imposition of State supervised monopoly over choice products which leaves the people with no place to complain because the State which ought to intervene to regulate unfair practices has made unfair practices it official fund raising technique. A truly privatized economy will create the requisite enabling environment for the much abused market forces to function and then, there will be the natural re-alignment between selling prices and production costs as freely dictated by the combined forces of demand and supply. The present situation where government irresponsibly raises prices in quantum and mega percentages can only promote the already grave national poverty. The essence of this submission should not be too difficult for President Obasanjo to comprehend but looking at the faces of those surrounding him, one can almost see all of the old Abacha political heirs pointing him to the enticing but dangerous path to governance via fund raising in the guise of price fixing, i.e., to chop and quench.

Professor Mike Ikhariale,

HRP,

Harvard Law School,

Cambridge, MA