Nigeria was very different before oil was discovered in the South-South region.
Back then, the economic makeup of the three regions could not have been any different than it is now. The North was doing very well. Its commodity exports based economy built on the sizable groundnut and cotton market was booming. The West was doing very well too. Cocoa had made the Yoruba’s very prosperous and they were confident in their abilities to take care of themselves. The Cocoa House was built in Ibadan; at that time it was the tallest building in the country. They also built the Liberty Stadium and started, with their own funds, the first television station in the whole of Africa, now called NTA. Cocoa was good to the West and they ran with it.
Unfortunately the East was not doing as well as the other two regions. The export market of palm oil was not strong and the East trailed the other two regions. And then we found oil and things fell apart.
The history of federalism in Nigeria is a fascinating study in self-interest and the corrupting powers of resource extraction. The major proponents of economic self-realization then are completely different from its supporters now. Back then the two regions whose exports were doing well in world markets were strident in their calls for 100% derivation, which means that a region gets to keep 100% of the resources it produces. The Easterners were adamant in their calls for a strong center and equitable distribution of all resources regardless of each regions share in the national pot. How times have changed!
Unfortunately, the constant shift in federalism’s proponents has permanently derailed a frank conversation on how Nigeria should order its political economic house. This piece is a call for such a conversation.
Before this begins we must first consider the role of a government in building a thriving economy.
A government, I hold, is charged with three main duties. It must correct market failures, redistribute income equitably, and maintain macro economic stability. The government must pick up the slack of the market for capitalism to thrive. It does this by ensuring that all citizens get equal access to opportunities by providing public goods, i.e. roads, schools, airports, health centers.
I do not need to belabor the efficiency of this model, as recent world economic history has proved this to be self-evident. Your government’s job is to provide services that is best provided by a central authority and this is how it can create an even playing ground so that true genius can innovate a better country.
Federalism fits into all of this because it helps to distribute duties between different branches of government by matching those duties to the peculiarity of the particular government. A strong central government is indispensable in the struggle to ensure equitable income distribution. The system of government responsible for public goods should quite clearly be the state government whose proximity to the people gives it the clear incentive to deliver these goods and services.
However, the federal government has the responsibility to provide oversight and set standards on the delivery of these public goods. It is the job of the central government to guarantee that an Aisha in Jigawa, a Chinwe in Enugu and a Tola in Ibadan all have similar access to public goods. It must do this by balancing its duties to equitable income distribution by ignoring the shortsighted calls for 100% derivation while simultaneously investing in the economic independence of the state and local governments because this is the only way to make the pot bigger.
All the different branches of Nigerian government are doing none of these things. The Federal Government concerns itself with all the rewards of a strong center with little of its responsibilities while the governors of the currently rich states insist on 100% derivation without understanding that equal access to opportunity for all citizens is the bedrock of progressive capitalism and democracy.
Op-ed pieces and contributions are the opinions of the writers only and do not represent the opinions of Y!/YNaija.