For once, perhaps in eons, a Nigerian leader has not traded off his humanity for political power. That about captures President Muhammadu Buhari’s take on fuel subsidy.
“I have received many literature on the need to remove subsidies, but much of it has no depth,” President Buhari declared. “When you touch the price of petroleum products: that has the effect of triggering price rises on transportation, food and rents. That is for those who earn salaries, but there are many who are jobless and will be affected by it.”
A sitting president, worried about subsidy removal affecting transportation, food and rents — when the state has provided his free! — as well as the jobless? That is rare presidential humanism around here!
Still, for the anti-fuel subsidy orchestra, with their infallible neo-liberal doctrine, Buhari’s take is pure heresy: crass populism, symbolising nothing but ancient thinking.
That has been the regnant temper since 1999, when pioneer 4th Republic President, Olusegun Obasanjo, laid down the rules — though, in truth, the ill-fated Umaru Yar’Adua (Allah bless his soul!) did a somewhat heretic foxtrot, reversing the 51% sale of Kaduna and new Port Harcourt refineries to Blue Star, an Aliko Dangote-led group of investors. But his ill health put paid to any further heretic rascality.
President Goodluck Jonathan would appear far too dazzled by the Breton-Woods tantrums of her economy empress, Ngozi Okonjo-Iweala, with her persistent hollering: “save, save, save for the rainy day”! A crucial part of those “savings” was the imperative to remove “subsidy”. Well, the rainy day is here, and there appears pretty little savings!
Even formal subsidy removal “savings”, epitomised by SURE-P, in some states like Lagos, have proved nothing but lethal chop-pey (easy loot) — a partisan-powered slush fund, to kill and maim opposing partisans, in an abortive bid to “capture Lagos”!
Gen. Obasanjo, on his part, was an apostle of state-driven economies, during his first coming as military head of state (1976-1979). But at his second coming, he played the classical neophyte, with vigour, pushing his new neo-liberal conversion, selling off about everything he had insisted the state must own — or run — before he saw the light; perhaps on his way to economic Damascus!
The apogee of that frenetic privatisation was his fuel liberalisation-by-importation policy, en route to selling off the local refineries — which organised Labour nevertheless resisted.
So, that single energy policy — liberalisation-by-importation — is the issue. The so-called fuel subsidy, alleged host to oil-marketing subsidy parasites, is only a symptom.
Now, how can a country solve a problem by, with a frenzy, attacking the symptom, while blissfully forgetting the root disease? That is the long-and-short of the subsidy removal hysteria.
But the mother philosophy remains unchanged. President Obasanjo, in opting for his flawed policy, declared his government powerless against petty rats, that fed fat on turn-around maintenance (TAM) contracts; which crippled Nigeria’s local refineries. So, for the abject failure to kill those big rats, subsidy must go; even if that was grave collateral damage to the law-abiding majority.
The latest strain of that philosophy: because subsidy thieves cannot be checkmated, subsidy must go! Then the clinching moan: subsidy does not get to the poor, anyway!
Now, that explosive mix of fact and emotion has registered a rather shrill presence in the long-running subsidy conundrum.
In the impassioned exchanges of January 2012’s Occupy Nigeria protests, embattled President Jonathan alleged that the pushers of the strike were over-fed Lagos denizens, whose monster cars guzzled fuel, monster lungs gulped choice victuals and brutal lips swilled bottled water, the tri-luxuries his poor Otuoke folk would never dare imagine, despite their state’s status as crude producer.
Bayelsa senator, Ben Murray-Bruce, has returned to that regional hysterics, in his latest road show against fuel subsidy. While the Lagos poor had access to cheap fuel, he rued, his Bayelsa poor (and for geographical balance, the Boko Haram-harassed North East poor!) had never benefited from it.
But to his credit, in a piece he wrote for This Day newspaper, “Tame fuel subsidy or it will tame Nigeria” (July 24) he erected a scaffolding of initiatives, of how to pay “transport subsidy” to transport owners and managers, after stopping fuel subsidy as we know it now; and getting rid of the fat fuel-importing rats. But his complex idea of fuel stumps, administered by designated fuel stations, portends an even more soulless racketeering!
The numbers ensemble have also weighed in, in the subsidy removal debate. To this clinical class, if imported fuel costs x at the global pump price, why should Nigerians buy it at a lower pump price of y — the subsidy price — simply because Nigeria produces crude? And the scarecrow clincher: crude, that is even progressively losing its market niche? Such is the numbers ensemble’s infallibility!
But wait a minute: what if local refineries processed the crude, and you didn’t have to import refined products — would those numbers still add up, infallibility and all?
That leads to the real contention. If crude were locally refined, to feed Nigeria and to export the excess — if any — the debate might just automatically change. If fuel importation stops, fuel importing parasites would vanish with their hosts, wouldn’t they?
So, if President Obasanjo had strategically invested in more refineries — despite the ready excuse that private investors that got licences did not build — would there still be the raging passionate debate over subsidy’s oil marketer “thieves”?
Obasanjo’s fitful flight from duty (on local refining), on Breton-Woods doctrinal fancies, has come back to haunt the polity! Even then, to many local neo-liberal ideologues, the solution is more Breton-Woods, and not a wise change of policy direction. That explains all the renewed “remove subsidy” passion.
That is why President Buhari should shun another round of a barren oil subsidy debate. He should rather — and fast — explore building more local refineries; and ensuring the existing ones, though ageing, work to their maximum present capacities.
As Ripples always notes, the government can build refineries and hand them over to private sector agents who can profitably run them — if such chores are beyond Nigerian public servants!
Even if after attaining local refining, and petrol still sells for N300 a litre — which however is unlikely — all the petro-chemical spin-offs from petroleum downstream would still have been beneficial to the local economy.
That cannot be said of the present net-loss of exporting crude cheap, but, at a premium, importing refined products.
That, not the so-called fuel subsidy, is the real tragedy of the extant energy policy.
‘How can a country solve a problem by attacking the symptom, while blissfully forgetting the root disease? That is the long-and-short of the subsidy removal hysteria’
