Maggie Anderson grew up poor in Liberty City, Miami, Florida. When she had social mobility, she became interested in the causes of the impecuniousness of black families in the United States. She discovered that of all racial communities in the U.S, the blacks have the least time keeping their dollars in their community. The Asians keep their dollars for about 28 days before it goes out of their community, the Jews for 19 days, and the blacks for 6 hours.
This implies that an Asian person can get most of the things he/she needs from an Asian business owner most times, so also for the Jews, but less so for the blacks. While the Asians and Jews make their dollars revolve in their communities, the blacks spend out of theirs. As such, they are left with little or no business of their own, and a high level of unemployment among their people. Can you imagine Hennessy without hip hop? And guess who owns Hennessy!
Maggie was inspired by the words of Dr. Martin Luther King Jnr that “philanthropy should not cause the philanthropist to overlook the circumstance of injustice which make philanthropy necessary” and attempted a black market only in 2009. She would only buy from black businesses. It was a difficult process, she affirmed. Her needed black businesses, like gas stations, were far away from her neighborhood. She was also a victim of racial vitriol. She was accused of economic racism. However, the campaign was eventually helpful to the black community, she noted. Her book, Our Black Year, is a product of her 2009 black market campaign. Maggie’s economic initiative did not only lift some black families from economic impoverishment, but also demonstrate simple economic truth: for a business to succeed, it must first succeed locally. As they say, “every politics is local”, so is every business.
I introduce Maggie’s initiative as a lens to anatomize the economic impact of the decisions or intentions of the members of the House of Representatives on the made in Nigeria cars. The news broke a few weeks ago that the committee in charge of car loans for the honorable members was indisposed to proposing Nigerian manufactured vehicles. They doubted the quality of the Nigerian made, as such, opted for imported cars at the rate of 50 Million Naira each.
While it makes sense to demand quality for an item like a vehicle, it is clear the Nigerian political elites and the state of the Nigerian economy are on parallel trajectories. It is still stupefying that despite the clear signs of a national economic unviability, we still run one of the most expensive governments in the world. Our impulsive borrowing is a touchstone of a lack of financial intelligence, always on the budget shortfall. Awarding 50 million naira for car loans in a nation with about 40% poverty index is like someone with no subsistent income taking a loan to buy an iPhone. It is economic ludicrous to borrow for luxury; it is immersing oneself in debt to invest in an industry one has no stake.
There are obvious economic benefits of government patronage of Nigerian made cars. It is one of the ways of sustaining Nigerian businesses, create more jobs for Nigerians, stimulate competition in the industry; which also raises product quality, and eventually make Nigerian cars affordable for many Nigerians.
That there is just one Nigerian owned car manufacturing company makes Nigerian cars beyond the means of most Nigerians. The economic reality is that fairly used car is affordable for many Nigerians. As such, consumers of brand-new cars are established firms. Since the Nigerian car company is a latecomer to the car industry, it will need other car assembly companies or retail stores like Toyota to slip up to be a major player in the industry. Many established firms have car deals with established car assemblies or retail stores. So, the local and new company will have a hard time breaking into the industry.
The only established firm obligated to the Nigerian manufacturer is the Nigerian government. Because, such goodwill does not only provide more revenues for the government in various manner of taxes, but it also reduces unemployment. In other climes, one of the principal duties of government after security is to make policies that keep businesses open. It is not a favor to the domestic industry when Government agencies or parastatals patronize local products; it is the government acting responsibly.
It is imaginable that most beneficiaries of the car loans will not own their first cars through the largesse. Hence, the bewilderment on the attraction for “quality” cars from abroad. The answer to this puzzle is in postcolonial theory. Many post-colonial theorists argue that many African nations have not decolonized. The frame of reference that was part of the colonial structure is still visible in the governing structures of many African states, especially in their economic deals.
The colonial economic exchange between Africa and Europe was not mutually beneficial. Resources like elephant ivories, rubber, coffee, cocoa were shipped from Africa to Europe by African slave laborers for exchange in beads, clothes, wine, etc. This was how the Belgian King, Leopold II ruled Congo. And in French- Cameroon and British-Nigeria, being a house boy of the colonial master, and having an object from his place was understood as prestigious. Sadly, till date, the “foreign” still enjoys unbridled attraction in Nigeria.
If it takes 6 hours for the black money to leave the black community in the United States, I guess it is an hour for the Nigerian money to leave the country for overseas. Imagine what 50 million Naira ($142,000) by 360 (or whatever the number of those deserving of the loan) would do to the Nigerian economy. And if I may ask, what financially savvy company offers as much as 50 million Naira car loan to a 4-year contract worker whose contract renewal is not guaranteed?
Father Fidelis writes from University of Notre Dame, Notre Dame, IN