Friday, 17 December 2010


Bastiat shows that, every time we make a choice, we give something up. This is what economists call opportunity cost. In 1500 words, identify three actions of your government you consider curious or rather suspicious and describe some of the hidden costs behind the actions.
Chofor Che Christian Aimé (
Frederic Bastiat shows that, every time we make a choice, we give something up. African governments still fall short of making decisions preferred by their people when it comes to opportunity costs. By focusing on the case of Cameroon, this contribution therefore seeks to identify three areas were the respect of individual liberty falls short. This contribution first of all delves into philosophical concepts surrounding opportunity cost, individual liberty and limited government in a free society. Examples are analysed in the case of Cameroon with respect to Bastiat’s point of view including poor governmental action in the country’s cement industry, poor privatisation of the road sector to the detriment of the domestic air transport sector and finally a poor policy in the energy sector. A conclusion is then advanced in favour of individual freedom and limited government.

Philosophical concepts of opportunity cost and the purpose of limited government in a free society
When economists refer to the “opportunity cost” of a resource, they mean the value of the next-highest-valued alternative use of that resource. Scarcity of resources is one of the more basic concepts of economics. Scarcity necessitates trade-offs, and trade-offs result in an opportunity cost. While the cost of a good or service often is thought of in monetary terms, the opportunity cost of a decision is based on what must be given up (the next best alternative) as a result of the decision. Any decision that involves a choice between two or more options has an opportunity cost. In relation to government decision, choices have to be made with respect to its available resources. The resources we are referring to here are land, labour and capital. Once a country decides to increase production in relation to a good or service after obeying the principles of opportunity cost, ways to achieve this include borrowing, technological advancement or more taxation. When a government decides to increase taxes to achieve this aim, then individual liberty is trampled upon. The people bare the brunt of certain government decisions.
Government is a legalised entity. One of the most perplexing problems of the ages seems to have been that of finding the proper place of government in society. The purpose in having a government with certain powers is not to concede that the scope of governmental power over the affairs of individuals should be all inclusive, or that one power justifies another. On the other hand, the absence of Government allows anarchy to rob the people of their liberty, where as at the other extreme, the government itself becomes the robber. The task in a liberal society therefore is to find that point where all the people will enjoy the greatest possible degree of liberty especially economic gains. It will allow full enjoyment of liberty by all who refrain from going beyond their right to and imposing on the liberty of others.
At this juncture it is important to review certain examples of actions carried out by the government of Cameroon, actions viewed as suspicious by a majority of the populace.

Focus on Cameroon’s cement industry
The cement sector in Cameroon is suffering from numerous government restrictions. The country's lone company has produced and marketed cement for the past 30 years. This action is indeed viewed by many as suspicious. Not only are business operators interested in the cement industry left out of the market, but government owns monopoly of this sector by imposing exorbitant taxes on those who venture to get into the industry. Despite news that there is no longer monopoly in this sector, free market principles are still to prevail. There is a contention that if this sector is opened to free trade and not over regulated, then free trade will prevail.
In such a case, what is unseen is the number of jobs which the country and most especially the private sector deprive her citizens of. As a result of non creation of jobs in the cement industry many are left unemployed.
Privatisation of the road sector to the detriment of domestic air transportation.

The state opens a road, builds a palace, repairs a street, digs a canal; with these projects it gives jobs to certain workers. That is what is seen. But it deprives certain other labourers of employment. That is what is not seen.
The Republic of Cameroon closed down a number of airports concerned with domestic air transportation in the 1980s after the economic crisis. The government argued that in so doing, more resources would be shifted to the road sector. Unfortunately, this sector remains deplorable today. Resources were not only shifted to the road sector but this sector was privatised. Not only were airports shut down all around the country but many people lost their jobs. The country lost some of her finest pilots. Today government has admitted that ten years after privatising the road sector, things have instead gone from bad to worst. The reason for bad results following such privatisation policy is because the process was imposed by the World Bank and International Monetary Fund (IMF), and the government of Cameroon continued to interfere in the process.
Resources which are being wasted in the road sector due to porous budgeting at the Country’s Parliament should be ploughed back into the domestic air sector. Many airports are wasting away in many parts of the country. Moreover, reopening these airports would create employment for many Cameroonians.

Issues with the energy and power sector in Cameroon

Access to energy is essential for economic, social and political development. It encourages individual development via an improvement in educational and sanitary conditions. It makes economic development possible through the mechanisation and modernisation of communications. It plays a role in improving the economic environment by opening the way to more efficient public sector intervention, greater respect for the environment and a strengthening of democracy. Despite its enormous potential in fossil and renewable energy sources, however, Africa and Cameroon in particular suffers from major energy deficits. Most governments especially the Cameroonian government has made a choice to continue allocating a fabulous amount of money for poor electricity supply.
The continent’s resources are underexploited or exported in raw form or wasted in the course of extraction or transport. For instance hydraulic basins are found in Central Africa. The Republic of Cameroon is based in Central Africa. The truth is that Cameroon still suffers from chronic power failure due to unexploited power sources. The hydraulic basins of Central Africa, the Rift Valley fault and the sunshine from which the continent in general benefits provide sources of hydraulic, geothermal and solar energy which are rarely equalled elsewhere in the world. At present, however, only a tiny part of this potential is exploited: 7 % of hydraulic capacity and less than 1 % of geothermal capacity, while photovoltaic development is embryonic. With what is being used by the Cameroonian government for electricity supply, a sustainable option could have been thermal energy. This source of energy is not exploited. This would cause the government less, in terms of energy supply and resources could now be diverted to the agricultural sector which needs to be mechanised. With the situation at hand, Cameroonians suffer from black outs and the electricity bills are exorbitant. The government of Cameroon needs to start rethinking her policy strategy and opt for more sustainable energy venues. Resources equally need to be focused on agriculture. The picture in the minds of Cameroonians today is that the privatisation process especially in the electricity sector, has failed woefully. Privatisation is a beautiful concept which propels development but when such a process is meddled in by government interference, then the principles of free markets and individual liberty are trampled upon.

In actual fact, this contribution did not set out to criticise the government of Cameroon. The Republic of Cameroon has been credited for several policies that work. Policies that encourage free markets and individual liberty. What this contribution did was to criticise certain government policy which stifles the creation of jobs and free markets.
What government members, public policy actors, economic planners and economists in Cameroon should do is to start revisiting strategies of improving on certain government action which stifles the creation of jobs. Ideas propounded by Frederic Bastiat must therefore be encouraged amongst policy actors, academics and even students for sustainability and economic growth in Africa and Cameroon in particular.

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