BREAKING: Oshiomhole and Free Market Economy 101

There is no such thing as an absolute free market economy anywhere in the world, as countries engage in degrees based on their uniqueness and economic trajec­tory throughout time, and, sur­prisingly, it is one of the Asian tigers, Singapore, rather than a Western country, that is ranked first in the world as the freest economy.….CONTINUE READING

Adam Smith, the father of modern economics, a forerun­ner of classical economics, and a Scottish philosopher, proposed this utopian philosophy, which assumes a market economy driv­en by the forces of demand and supply, as well as an invisible hand guiding market outcomes.

As a result of this, Senator Adams Oshiomhole recently had one of his best moments in the Senate. His eloquent delivery on the dangers of the free market economy model on the floor of the house during the National Assembly (NASS) screening exercise of the CBN governor designate and his team went vi­ral, earning him accolades and respect because it resonated with Nigerians’ genuine concern about the state of the economy.

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Oshiomhole exuded so much patriotism beyond party affini­ties, dispassionately called for creative approaches to solving our economic problems, and un­ambiguously marshalled reasons that African nations like Nigeria must tread with caution and min­imise their risks about the spec­trum of the laissez-faire tenets.

These are some relevant ex­cerpts from Senator Oshiom­hole’s text: “…I listen to every­body here and it seems we have all submitted to the so-called market forces and rely on the in­visible hand of Adam Smith to regulate and determine the value of the Naira … I think there is the need for a complete rethink­ing outside the box.

When the West celebrates our free market, no control and so on, I am always suspicious. When they clap for us that we are do­ing the right thing- the state is withdrawing, less regulation, at a time when we can see that turn of world trade, nation states are negotiating with other nation states to have specific trade rela­tionship…In those days, govern­ment under the policy of back­wards integration, prohibited manufacturers from importing certain items, even some textile fabrics were prohibited because the game of competition presup­poses equality and a level playing field.

You cannot ask a feather weight champion to go and en­gage a heavy weight champion in the name of competition. Ni­geria needs specific tools to pro­tect her industries at home and not pretend that a man with one leg can compete in a race with a man with two legs. We need a complete radical shift. We don’t need the West to plan for us; we need Nigerians to plan for us.

We need to interrogate our assumptions and ensure we are not copying Washington and all these international financial capitals. It is there interest, there is no such thing as a common in­terest… If this president must deliver on the renewed hope, he must device new tools away from the invisible market hands o visible hands that must be held responsible and accountable for our collective future.”

Tinubunomics leans towards a free market economy model, and in a broader sense, the assump­tions of a free market economy include but are not limited to, free enterprises that encapsulate a free and open trade system, un­hindered private ownership of property, competition, consumer sovereignty, profit taking, eco­nomic freedom, and. absence or limited Government Interfer­ence, .etc.

Over time, this economic prop­osition comes as an antidote for most development woes confront­ing third-world nations, Africa and Nigeria in particular, such that global monetary institu­tions, international donors and development agencies often de­mand this as preconditions to access loans, grants and other interventions.

It was constraints like these that birthed Austerity Measures during the Shehu Shagari ad­ministration, and prominently, the Structural Adjustment Pro­gram, SAP, under the regime of Babangida, but the outcomes were disastrous – wiping out the middle class, killed local in­dustries, shut up interest rates, skyrocketed inflation and the economy damaged irretrievably till date.

Although African economies exhibit propensities of incessant political instability, massive cor­ruption, weak market structure, no accountability, absence of transparency and sincerity of purpose, and such economies are expected to be thrown open to the vagaries of a free market model? So, the prerequisite conditions for super-imposing such mar­ket-driven economic doctrine are absent such that further imposi­tion is fallacious, unrealistic and a deliberate act of enshrining poverty in the continent.

It will shock you that Nigeria’s most beloved model and one of the largest and most vibrant economies in the world, the Unit­ed States, is ranked number 25th among the nations that practice the free market model, our colo­nial imperialist, the United King­dom, is ranked 28th, France 57th, and Germany 14th, not to talk about the second largest econo­my in the world, China which is a closed economy, so, how can you fault the submission of Adams Oshiomhole?

For a country whose citizens live on below $1 daily, the con­sumer pricing index is threat­eningly high, unemployment is endemic, hundreds of manufac­turing concerns are folding up, poverty is unabated, and there are no social security nets yet, this government tilts towards having a greater degree of a laissez-faire model in a dollar­ised economy. No doubt, these economic vaccines from the World Bank, IMF and interna­tional financial donor agencies are prescriptions that will bury most African economies.

Amidst countless examples, take another look at the kero­sene and diesel market since the removal of subsidies -have the market forces brought down the prices of the products or with free trade and open import ar­rangements, are industries grow­ing or dying?

All over the world, across the most dynamic economies, no sane government leaves certain levels of the welfare of her peo­ple to market forces, no matter what, it is subsidy, period.

While we saluted the removal of oil subsidy, the truth is appar­ent that we needed to remove those invisible corrupt hands derailing the programme, so is this government looking the other way on subsidy corruption and the rot in the forex market but pointing the gun at the fore­head of innocent Nigerians, then he may just be laying the bed as the worst president Nigeria will ever have.

The Tinubu government has no business feeling ashamed of reversing itself and embracing some measures of fuel subsidy because former President Bu­hari handed him a dead economy, thus the need for extraordinary measures to stabilise the econo­my before attempting a rebound.

The nation must develop a home-grown economic model that will deliver the right expec­tations or embrace the Welfare State Capitalism model because there is no invisible hand any­where, and the so-called forces of demand and supply are not work­ing for most African economies.

Is it difficult to understand in Nigeria that the forces of demand and supply are non-existent, and can anyone remember how Globacom gave Nigerians the per-second billing that crashed the exorbitant call rates in this country when others were mak­ing monopolistic rants, and was that market demand or disrup­tion in plain language or desper­ation, and today, BUA group has come to the rescue of Nigerians by crashing the price of cement but what were the metrics – de­mand and supply?

How can any nation compete from a point of weakness and grow its economy – somebody is not telling the truth. There are better days ahead for Osho Baba as we hope to see more patriotic and non-partisan deliveries on the floor of the National Assem­bly.….CONTINUE READING

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