Economists, Politicians and the Rest of Us

Charles Chukwuma Soludo
Soludo image (c)

It was Austin Erhabor, a colleague of mine, who forwarded Charles Soludo’s article titled “Buhari vs. Jonathan: Beyond the Election” to my email. When I did not get back to him a day after, he rightly guessed that I had not read it. So he called, and urged me to read it. From his enthusiastic prompting, I suspected there was something in it that he wanted us to discuss. I was therefore forced to read it, after which I called and told him that that was the first socio-political-cum-economic literature I had read in this election season, and that it would certainly engender a lot of responses. Erhabor’s joy about the article was that it could help the public to cut through the government’s superficial claims and caution the public against a wholesale belief in the promises of the opposition party. I agreed with him, stressing that without articles like that, the public may not have the tool and material with which to have a reality check on those outlandish claims and promises that verge on the ridiculous.

Soludo image (c)
Soludo image (c)

Soludo’s article apparently played favourites with the All Progressives Congress (APC). But what education is there in the world that could have enabled Soludo to do any other thing beyond disbelieving the party’s ability to deliver on its promises when the party has not been in charge of the federal government? The Peoples Democratic Party (PDP) has been in power and in charge of the country’s economy from 1999 till date. Soludo was a servant of the PDP, presiding over the Central Bank of Nigeria, an institution that is at the foundation of the nation’s economy, between May 29, 2004 and May 29, 2009. Soludo is part of the past that President Goodluck Jonathan’s campaign team claims Jonathan’s administration has surpassed beyond measure. He therefore has the locus and background to respond to this and other related claims. On that score, I consider the article a balanced challenge to the two contending parties to tell the people the truth instead of deceiving them with outlandish statistics or bogus promises.

Soludo’s professed concern is that the electorate is going into the forthcoming general elections in the face of “major development challenges –corruption, insecurity, economy (unemployment/poverty, power, infrastructure, etc.), health, education, etc.” and yet neither the APC nor the PDP has any credible agenda to deal with those challenges. As the drastic fall in oil prices is sure to further shrink the country’s fragile financial base, Soludo believes that now is the time to confront the PDP with relevant statistics and what these statistics portend for the economy and Nigerians. Soludo might sound arrogant, dismissive and all-knowing; but he certainly put his finger on what many of us who are not economists could not quite put our fingers on. He presented us with perspectives with which we could easily relate our individual lives to the figures and statistics being bandied around.

Soludo’s article raised the bar on debates concerning several issues,including the following: 1. the effect of the six-year oil boom on the economy; 2. the depletion of the foreign reserves; 3. the astronomical depreciation of the exchange rate; 4. the escalation of the public debt; 5. the growth in poverty and unemployment;and 6. the politics of the rebasement of the economy. These issues are germane and worth discussing, even if I am not entirely impressed by Soludo’s predictions, or conclusions on them.

This brings to mind the issue of our uncultured culture of debates. Our politicians hardly infuse humour and wit in political debates. They personalize debates and turn them to quarrels, thereby denying the public the chance to learn from political debates. Instead of exchanging ideas, they talk past themselves. Conversely, Westerners benefit a lot from political debates. One recalls how Ronald Reagan used the issue of his advanced age to have a 49-state landslide victory against Walter Mondale in the 1984 American presidential election. The famous one-liner – “I will not make age an issue of this campaign. I am not going to exploit for political purposes my opponent’s youth and inexperience” – was all he needed to consign Mondale to the cooler. But that is not what we have here. Most of the reactions to Soludo’s article – with the exception of Kayode Fayemi’s, Oby Ezekwesili’s, Pat Utomi’s and a few others – fall short of what a decent rebuttal should contain.

The article had challenged the claims and propriety of the spurs and laurels that Mr. President – and his men –depend on to claim that his administration has outperformed his predecessors’. Instead of joining issues with Soludo, Femi Fani-Kayode threw back at us the cliché that Nigeria is Africa’s largest economy, hurling invectives at Soludo, casting aspersions on Muhammadu Buhari. This is one instance of a response proving an allegation. If Fani-Kayode’s response was embarrassing, that of Ngozi Okonjo-Iweala, Coordinating Minister for the Economy, was scandalous. She wasted valuable time and space attacking the character of Soludo so much so that when it was time to address the issues raised by Soludo she confounded everyone. For instance, to the pointed claim that the government wasted huge oil earnings, Okonjo-Iweala responded that “even the more interesting is the fact that the oil sector did not drive the economic performance but the non-oil sector…” How could a mismanaged oil sector have driven the economy? Would the economy not have been better for it if the largest earning sector had been the overall driver of the economy? Is diversification a substitute for holistic performance of all sectors of the economy? Perhaps this debate will educate us further on these issues. Okonjo-Iweala’s response on the exchange rate also baffles one. After gloating over the performance of the non oil sector – the new driver of the economy, it becomes illogical to say that “this administration again managed to stabilize the naira exchange rate, such that between May 2011 and the end of 2014, official exchange rate against the dollar rarely moved out of the N153 to 156 band. It is only with the recent dramatic fall in oil prices and the consequent impact on our foreign reserves that the exchange rate has become volatile.” Haba! Soludo can just rest his case on this argument, because that is exactly the point he made. The economy is for now dependent on oil.Therefore the volatility of the exchange rate is a result of the mismanagement of that sector that did deny the country savings for the rainy day. Soludo complained about the government’s mismanagement of the seven fat cows,stating that his prediction about the days of the seven lean cows was ignored by the government. Okonjo-Iweala weakened her own position further by pitiably attempting to justify the fate of the naira with Soludo’s earlier failed attempt to devalue the naira.

Okonjo-Iweala’s argument about oil theft and refusal to save in the Excess Crude Oil Account is most disheartening. These two are leadership questions that do not present Mr. President as a strong, decisive, self-willed and purposeful leader. The Minister took the public for granted when she cleverly danced around the issue of the poverty rate, an issue that has nothing to do with Soludo, as Soludo has never been Nigeria’s President. And promising to create jobs is no answer to the question as to why our country has a high poverty rate despite her being the largest economy in Africa.

Soludo’s first- part reply to Okonjo-Iweala’s response is more like a Curriculum Vitae. For the debate to be deepened, I implore dispassionate and less egocentric Nigerians to join it.

Written by
Sam Kargbo
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