Karl Marx opened the eyes of the world to the fact that the substructure (economy) of any given political system determines to a large extent the superstructure (politics, law, culture, socialisation amongst others) of the people in that system. Therefore, the positive internal dynamism of a buoyant nation is explained as being a byproduct of good economic foundation.
ON the strength of this, THE HOPE is not amazed at the internal fragmentation and disillusions that have characterized the information space of Nigeria in her time of depression. However, we are at sea on the heels of information by Dr. Godwin Obaseki, governor of Edo State, that the nation printed between N50 to N60 billion in order to empower states carry out their statutory functions to the people. While there was a rebuttal of the magnitude of the claims of the governor by the government, the latter in the days that followed had revealed desperate methods and techniques are needed to salvage the nation’s economy. The gory picture therefore presents a government that has lost the capacity to earn funds to finance her budget.
WHILE we observed that the Federal Government has the power to print new currencies, as the occasion lawfully demands, THE HOPE frowns at a situation where government has to print monies to meet recurrent demands. This stance is hinged on the fact that printing more money would neither increase economic output nor trigger development. Rather, it increases the amount of money in circulation without increasing the amount of goods in the market. Therefore, while giving consumers the strength to make more demands, firms are not able to meet up with such demands. Invariably, given the basic law of demand and supply, which states that higher prices would chase fewer supplies, inflation becomes the outcome.
BY implication, printed funds are debts, which later earnings have to repay. However, with the shortfalls in international trade, high rate of inflation in the country and of course the low levels of internal generated revenues, it is doubtful that borrowed local funds would be remitted. The economic implication of spending unearned funds is already biting hard. While the Nigerian government may have been hoodwinked to believe that these excess funds could be mopped with taxation, there is the need to educate that higher taxation implies higher production costs, and thus higher prices of commodities. The result is still inflation. Thus given the devalued state of the Naira to the Dollar in international transactions, Nigeria is also heading towards hyperinflation. The effect of these on the substructure is the increased rate of corruption, insecurity, criminality, strikes and, of course, the hike in the ransom demands of kidnappers.
Operating a budget deficit is good for a political system void of anti-investment factors like Nigeria. Therefore, the injection of unearned currencies into the market would not only reduce the strength of the Naira, but also subject the country to perpetual slavery in the comity of nations. THE HOPE insists that the Federal Government should harness her resources and channel such towards the creation of investment friendly environment in Nigeria. Diversification into agriculture cannot salvage the nation as long as bandits and killer herdsmen make farmlands inaccessible. As long as there is erratic power supply, high and unreasonable cost in the process of doing business, the economy of the nation cannot improve. Un-invested but consumed loans would only add to the debt burdens and freeze currencies that can bring the desired turnarounds in the political system. Therefore, THE HOPE warns that printing currencies to meet recurrent needs under any guise is an invitation to economic disaster.
GOVERNMENT should rather block all the leakages in its economic transactions. There is an urgent need for the prioritization of government expenditures to cater for the needful rather than the beautiful. Unnecessary political appointees that drain the few earning of government should also be dropped, while only projects of developmental value should be approved and funded.
FURTHERMORE, the Federal Government needs more than ever to improve its capacity to earn, without laying extra burdens on her citizens. Therefore, rather than print currencies, we conclude by laying emphasis on the need for government to develop and promote investment friendly environments, kill corruption, develop the manufacturing sector, and promote the international marketing of her socio-cultural and geographical heritage.