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Ending the subsidy of corruption in Nigeria (1)

Published by Nigerian Compass on Fri, 06 Jan 2012

The Nigerian government has so far been able to fool most Nigerians into accepting that there is a subsidy on premium motor spirits, commonly called petroleum. Nigerians, who have since independence subsidized corruption leadership, are being paid back in an offensive and reprehensible way by a president they least expected to hurt them. The nation woke up in awe and shock by the sudden announcement of gasoline price increases on New Year day. How they will take the hard blow from their very gentle president is yet difficult to predict but if what the media have been reporting is credible, Nigeria will be flattened by angry protests when the citizens recover from the heavy punch. Sadly, the same media organizations are the medium used to deliver and serve ordinary Nigerians, who will surely suffer if the new prices stand, on the dinner plate of Aso Rock. The media have never seriously challenged the government's assertion of a subsidy with facts and have almost acted entirely in agreement with the Goodluck Jonathan administration. Going by the accounts of the newspapers online on January 1, 2012, there is an agreement that there was indeed a subsidy on end-user petroleum products. The Guardian admitted in its lead story that '...subsidy on petrol had finally been removed.' The Nation capitulated in a flashy headline, 'Subsidy removal: Tougher times ahead in 2012.' The Vanguard was as lame, when it wrote: 'Fuel subsidy removal: Pro-Labour groups call for mass protest.' Daily Sun would not be outdone in laziness and ignorance, as it plastered a flash headline titled: 'Fuel Subsidy Gone' on its home page. Nigerian Tribune, joining the bandwagon, announced: 'FG removes subsidy on petrol.' PM News went further, reporting that 'Thus, Nigerian petrol consumers are expected to start buying petrol at this price with the announcement of the end of subsidy regime today.' Thomas Jefferson, founding father and former United States president wrote in 1816 that when the press is free and people are able to read, all is safe. How myopic he was in his assumption, you would think. The press is free in Nigeria and most of the people are able to read, yet all is not safe. Thomas Jefferson deserves a pardon since the Nigerian factor could never have been imagined in his days. It is so easy to get in the unnecessary and unfruitful discussion of whether or not the so-called subsidy should have been removed at this time. However, launching that discourse at all is based on a false premise. We need to retrace our steps and ask simple questions to rationally challenge any statement that claims there was a subsidy on Nigeria's gasoline as sold through the media. The simple fact is that there was never a subsidy and the Federal Government, through the overwhelming inducement of the media, has been able to force the nation into admitting that there was assistance on petroleum products. The government information machinery has succeeded in making the word subsidy stick through preponderant usage. We should attempt to detach that word from our national vocabulary until we get the facts straight. It is not too difficult to understand the issues involved in the politics of oil marketing if we use common sense. Without understanding the basic arguments of the price increase, we will be awarding free money to the already gravely corrupt government officials in Nigeria. These are the same officials who are only so smart to buy the most expensive cars anywhere with stolen money, for use on the worst roads they can be driven on. We cannot possibly want to award more money to the greedy loafers who have run the nation aground through policies that put expensive cars on bad roads. I will use a simple analogy to illustrate the non-existence of oil subsidy. Nigeria is this groundnut farmer in Kano who sells his entire groundnut when it is clear to him he will soon need groundnut oil for cooking. This seller grows each nut for one naira and sells for five naira, but buys back the cooking oil for 8 naira. He has many other options. First, he could convert the nut to oil by himself. However, through mismanagement and corruption, he has damaged the tools he requires for self-production. Secondly, he could give the nuts away at no cost and pay the external producer just the production cost of conversion to cooking oil. Thirdly, he could bring others in to his farm to convert the oil for him for a profit. Our groundnut seller has, however, ignored all these options, deciding greedily to sell his nuts for the market price, knowing fully well that he will also be forced to buy back the finished product at the going market rate. When he buys the end product, he fails to tell members of his household about the profit he already pocketed through sale at the market rate. Instead, he tells his wife and children the cooking oil is priced at 8 naira, without declaring the five naira he already pocketed. Neither would he tell them about the various fees which he charges through his workers to buy back the oil; and how the selling and buying process exponentially increases the cost of the finished product by the time it gets to his kitchen. Nigeria is buying oil back at the same rate that countries like Sierra Leone, India or Jamaica would, but it does not buy with an empty hand. The cost of Nigeria's refined oil is not being computed with a deduction of the profit on the crude oil. That is where the math is all wrong. That is where the government has not been honest with its own people by presenting fuzzy math. That is where the media should have started the discussion. I have read a few complex explanations by subject matter experts- it is now time to simplify this debate for the public so that our citizens can embark on the 'oil subsidy' protests with a clear understanding of the issues.To be continued...Odediran, former journalist in Nigeria and the founder of againstbabangida.com, writes from New Jersey.
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