Friday, 17 December 2010


Of the many choices my mind can express, I think of no apt way to begin this quest except Frederic Bastiat’s introduction to his essay, What is seen and what is not seen. Bastiat wrote and I quote verbatim, ‘’in the economic sphere, an act, a habit, an institution, a law produces not only one effect, but a series of effects. Of these effects, the first alone is immediate; it appears simultaneously with its cause; it is seen. The other effects emerge only subsequently; they are not seen; we are fortunate if we foresee them’’.
Any sane man or government expects a seen immediate reaction to his action. Physics taught of the law of action and reaction being equal and opposite, Bastiat taught us that that equality and opposition goes beyond what can be seen and what can be measured. A government announces what it deems a great policy, allocating money to a cause it had no business getting involved with in the first instant, expecting a result that often never results, but more crucially, never looking into the other hidden attendant effects of that action. Frederic Bastiat’s is what I call the holistic view and it is what guides this exposition on the parochialism of the actions of the Nigerian government. The three actions of government I will deal with are;

1. the decision to spend 10 billion Naira (about $66.67million) on the celebration of Nigeria’s 50th year of Independence,
2. the decision to continue subsidizing the price of fuel and
3. the decision to remain the sole provider of power and energy to Nigerians.
They all have far-reaching hidden costs, even more expensive than the actions and the seen consequences combined. They are elucidated below.

Nigeria is 50, so we must celebrate fifty years of lowering the Union Jack and replacing it with the Green-White-Green. Why would I begrudge a nation long shackled by poverty and corruption due to the fetters the government has placed on economic freedom, if it decides to celebrate 50 years of enduring unnecessary pain, human limitedness, and regressive policies? A nation where money is seen to be the root of all evil rather than what it truly is. Only if the individual knows the root of money, being a tool of exchange, rooted in the production of goods and services by the minds of productive men. Where did the 10 billion Naira for the world’s most expensive celebration of poverty and inefficiency come from? Did it come from a government without direction, a government without a code of values – the Nigerian government- or from the pockets of men able to produce, men whose effect of production, government has deemed necessary to waste? It is easy to see the filled banquet halls, the beautiful display of pyrotechnics, the hurriedly painted government houses, and roads, the trite speeches of a promising future, as the effects of spending the money that never should have been with the government, if men were truly free. What we do not see are the Mephistophelian glints in the eyes of politicians desperate to line their pockets for the umpteenth time, from the efforts of men who have decided to live with code of values. What we do not see is the man who has been denied the use of more capital to infuse into his production, having paid such as tax. We do not see the goods and services that would have been produced had men of values been allowed the right to spend their money on productive means rather than forced to pay taxes that have ended up as meat on the tables of lazy men in the name of national celebration. Of what difference is this from the depravity that states ‘’ from each according to his ability, to each according to his need’’? Men who have decided to engage their minds in creating value have consequently paid for the meals of men in need of food to remember a nation was set on the path of freedom 50 years ago. Do not mind the fact that that freedom remains an illusion. Production begets production, if one man is deprived of the right to produce more, some more men will be limited by his inability. Would the government have taken a different decision had it been Bastiatic enough in its view? History says no.

Men have been deprived the right to explore and refine crude oil. The government alone can refine petroleum so as it is and will always be the case, the government fails in this business, and thus locally refined petrol cannot meet local demand for petrol. The government therefore grants licenses for petrol importation to a select few who then import the product into Nigeria. They are not allowed to sell at prices determined by their cost of production, the government subsidizes the price, which means that all the licensees who are locally called petroleum marketers sell at the same price, which currently stands at 65 Naira per litre. Depending on international rates for petroleum products, the subsidy could be as much as 20 Naira per litre, which translates to a subsidy of at least 300 hundred million naira ($2million) per day depending on demand. From the supply, to the demand and the consumption of petrol in Nigeria, what we have is a continuum of insanity. Government had no business in petroleum refining, yet it refines petrol, government should open the market for petrol importation yet it restricts it. Importers should determine their prices based on the fair language of a competitive market yet they remain handicapped by laws. The populace should buy what their productive capacity can afford, yet the Santa Claus of the people decides to assist them a little. Sadly enough, what is seen are fuel shortages, adulterated fuel, and deficit budgets which are all unpalatable effects, yet the unseen is even graver; given the freedom to express their economic right to produce, individual Nigerians can produce enough for exportation because they have both the human capital and the mineral resource for such. What is not seen as in every case, are the men who only seek to make money without producing but simply by cornering public wealth. They would be poor, had the public through the laws not decided for a common wealth. The government remains the cheerful giver of what should never have been its. This is the height of economic aberration.

It was once called the National Electric Power Authority, but the people were more real in christening it Never Expect Power Always, both ways it spells NEPA. It is now called the Power Holding Company of Nigeria, but the people were more sincere in calling it Please Hold Candles Now. Both ways, it spells PHCN. That is the government company, literarily burdened with the expectation to provide power supply to Nigeria’s 150 million people. It failed woefully as NEPA, so it was restructured and renamed PHCN, but PHCN has only gone a step further by failing absolutely. Nigerians are more used to the contradiction of darkness than the beauty of light. If as I have come to believe, having read the words of John Galt in Ayn Rand’s Atlas Shrugged, that there are no contradictions in life, then we must have had a false premise or several false premises. Nigeria’s incessant power failures are a case of multiple contradictions. You would expect that if what is seen is not good enough, people would pay attention to what is unseen and if that is worse then that action would be discarded. Not so here. What is seen here is unseen. By this, I mean darkness. It is a sharp metaphor for the unseen. What is unseen are the several billions spent by the people on power generating plants, monies spent on fueling them and maintenance. What is unseen is the forced use of fuel for generating electricity instead of some better uses including fueling cars and machines. What is not seen is the attendant increase in the demand for fuel that increases its price and since the government subsidizes this, it then means more taxes spent on powering darkness as it were. The whole picture tells of a government, seemingly empowered by law to power darkness.

In conclusion, let it be known by men, that it is not as much as what is obviously seen as the result of our actions that matter, but the inherent unseen effects. It is more pathetic if the seen and the unseen are undesirable. This is the case of Nigeria, a country where everything is seen to be moving, but where the unseen, is the fact that, while it truly moves back and forth, the sum of its movement is backward. This is not directly seen, but a man who works his mind sees it as Frederic Bastiat did.

Japheth J Omojuwa

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