Is this the End of Capitalism?

I have been a participant observer in the American system for some years now. I have worked as an employee, as self employed participant and as a small businessman responsible for others. I know what it feels like to look into someone's eyes and see desperation, fear of not knowing how to pay his next bill. I have witnessed the rise and fall of small businesses as a result of inability to obtain credit facility for working capital.

What is happening now in the global market, especially in the US, is a trickle up effect of a crisis that started a long time ago, which hit small businessmen years earlier. Now that it is beginning to affect the big corporations everyone seems to notice. It is a cumulative effect of the loss of confidence in the US credit system. A ripple effect of a sudden break in the flow of the nutrient that sustains the economic life of America.

The US is a society driven by credit, from the individual credit cards, personal loans, home equity loans and mortgages to lines of credit extended to corporations. The system stays perfect if undisturbed but crumbles immediately there is a break in the chain. Contrary to government's belief that the problem is bad investments made by banks, the real problem lies in the attempt by banks to break the flow of funds into the system by tightening up credit conditions. They simply stopped giving mortgages and loans as freely as they did a few years ago. When they upped the conditions, the people had less to spend and less new credit lines to help service existing loans. The defaults started as a result. People who used to survive by rolling debt over from one bank to another, could no longer do so. There are no new credit offers, no new balance transfer opportunities, no new mortgage refinancing hence no new source of funds to continue the roll over that has sustained the individual. And from the micro the problem extends to the macro, corporations were soon affected and finally the banks who no longer make money because the are not growing the sources. The solution? Is it an an end to capitalism as the buy in and bailout trend portends?

The solution is neither in extreme regulation nor deregulation but a mixture of both. The solution is in ensuring that banks regain confidence in borrowers' ability to pay the loans. To achieve that, the borrowers must have their jobs back, they must have their mortgage loans and credit facilities back. Which happens first seems like the chicken and egg question. Both must happen at the same time, developing simultaneously for the crisis to be over. It does not matter how much money government pumps into the banks, if banks stay the high ground of keeping tight credit conditions, the problem will linger.

Why is Gombe Paying Ex-govs N200 Million?

Gombe State, one of Nigeria's poorest, is leading the way in paying huge sums in severance package to former governors and their deputies.  Each governor gets about 202 million naira (about $1.8m).  This is also in addition to getting an executive assistant, two cars, and drivers paid for by the state.

This sort of folly makes one cry for Nigeria.  It shows we are a long way from the path of development.  It shows that our politicians are in it for selfish reasons and far from the service of the people.  Think of how much it would cost to cover all the ex-governors and their deputies and what the huge sums could do for a  general hospital.   Think of how much would be achieved in education with that much money.  Think of other infrastructure that would be improved  in the state. 

Of course we should also consider the impact on future elections.  In a country that seeks electoral reforms, making the office of governor so lucrative will make rigging more attractive.   How then can they abate electoral fraud given that getting elected would mean getting paid hundreds of millions.

Nigeria cannot successfully solicit support and all sorts of aid from the advanced world when such irresponsibility is the mark of our leadership.  Be frugal with what you have so you might be given more.

Even the US president does not get paid that much in office let alone after leaving.  President Clinton lives in a house bought from personal funds after leaving office.  President Bush is going back to his personal ranch after serving and his current salary is far less than poor Gombe State pays its former governors.  Bush earns about $400,000 per annum and this is a man who occupies the World's busiest political office, sits on enough military might to wipe out the entire African continent and presides over a yearly budget many times over what Africa spends in years.  New York city's, for instance, dwarfs Nigeria's federal budget.    It really bothers me to see our people tolerate such waste.

Ex- governors should not be paid more than senior civil servants get in gratuity upon retirement and should not under any circumstance be paid before a civil servant who has served the state for 35 years.

Nigeria and Nuclear Energy

I have just finished reading a news piece about the concerns of G8 nations over Nigeria's plans to develop nuclear power plants and I thought, sure there is a good reason to be concerned.    I am worried not that Nigeria will be ranked with Iran on the level of world suspicion but I am afraid for Nigerians.

Nigerians need to be protected from themselves.  Nuclear accidents are not a head on collision between two molue buses nor passenger plane crash that we are so used to yet  are unable to muster fruitful search and rescue each time there is a crash.   Nuclear technology requires a lot more commitment.

It takes collective responsibility to manage a nuclear facility.  It takes a responsible security set up to safeguard it.  Do we  have such a police force?  Can someone guarantee that Osama Bin Laden or a rogue businessman cannot buy his way into the plant and collect items for a nuclear weapon?  Can someone guarantee that the facility will be maintained and not left mismanaged like NEPA plants all over the country.  What happens if there is an explosion caused by poor maintenance.

Sure Nigeria needs the facility but I doubt we have the level of responsibility and management needed to keep and operate it safely.   Why don't we look elsewhere, there is solar energy.  There is hydro energy and a lot more we can look into.

Humphrey Nwosu Blew It

I have followed the reports on Humphrey Nwosu's feeble attempt to defend IBB on June 12 and I cannot help but wonder why the electoral commission chairman should be the insider who knows the truth.

Nwosu, to the best of my knowledge, was not a member of the military junta ruling Nigeria at that time.   How then can he convince us that he actually knew what happened?  Or is Nwosu simply a PR mouthpiece for IBB as has been suggested?  I cannot put it beyond that for I have noticed many people who worked for Babangida continue in that capacity, as his "loyal servants" even long after leaving office. 

I could only remember Nwosu as a loquacious university teacher who was appointed to conduct elections for Nigeria.  To his credit, however, goes the widely accepted view that he conducted the freest polls in the country's history.  Also to his credit is the option A4 open voting system, however primitive.  Option A4 did work but the gains of that were obliterated by the annulment and subsequent crises that followed in the Abacha years.

I think people like Nwosu should keep quiet and stop attempting to rewrite history.  Babangida was the president and leader of the military council and the responsibility  of all actions and inactions of that regime and the military junta at the top were ultimately his.  Let him live with that.

Again, Where is the Political Reform?

Part of my morning routine everyday is to read a couple of Nigerian newspapers online and it is always one grim news after another.  Often , the story is about the circus that goes on in government and the performers both in the executive and legislative arms.  One of the stories that caught my attention this week was a suggestion that President Yar'Adua's political reform committee was mulling over the idea of open ballot in future elections and that got me wondering.

I wondered why? I wondered what for? and I wondered if the politicians were not in Nigeria during Humphrey Nwosu's option A4 and the subsequent June 12 crisis. Most of all, I really wondered if these 'reformers' understood that the problem with our electoral system is not how we vote but with the conduct of politicians, law enforcement and election officials.  It does not matter if the ballot is secret or open.   Those who rig elections in most cases just change the numbers on the results sheet as we have learnt from many election petitions which followed the 2007 polls. Why then do they waste time looking where the problem does not exist?

I'm Proud to be a Nigerian

I was driving to work in a busy New York morning when this sticker on the back windshield of a car in front caught my attention.  It was very legible, in bold prints on green background and it read: I'm a proud Nigerian.

The car was an old Japanese model, perhaps, a testimony to the owner's struggles in God's own country.  Perhaps also, it is just a modest reminder that "some day we shall return."

When i drove past the car, I honked in comradeship and looked back on my rear view mirror to catch a glimpse of the young man behind those wheels.  For one moment, I felt a little proud that there is at least one Nigerian out here who feels great about motherland.  Kudos to him for voicing it out in his little way.

Keep Parties Out of INEC

The politicians are again trying to thwart the efforts at electoral reform in Nigeria. What else would one conclude when the parties in alliance with the present PDP government (ANPP,PPA,APGA) are suggesting that political parties nominate members of the electoral commission in future and the members so nominated should then choose a chairman among them.

This is fraught with danger. For genuine reform of the electoral body to occur, politicians should have absolutely no say in the appointments. They should, if possible, not even be distant cousins of those so appointed.

If the parties have their way, to whom would the chairman and his officers be loyal? To their parties of course. Rigging would continue and we would be back to the beginning. I can only imagine what happens on election night when all the officers will be outdoing themselves to stuff ballot boxes or fill in returns.

I think the country should consider appointing civil servants to those positions or simply conduct elections for electoral officers. My preference is the former; civil servants whose tenure would be guaranteed by the constitution will definitely fit the role better.