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In the third of its three rules of finance, Beveridge prefers raising the funds required by taxation rather than by borrowing. He has two reasons for his preference.
Borrowing would encourage a sense of financial irresponsibility on the part of the Government of the day; it would also enhance the income of the rentier class whose slow but sure euthanasia both he and Keynes would like to see. In pages 192 and 193 of The People’s Republic, I have advocated the abolition of interest and the legal elimination of the rentier class. It follows, therefore, that I do not at all share Beveridge’s preference.
This parting of the ways is necessitated by our different approaches to the solution of the same problem. Whilst Beveridge believes that full employment and the general welfare of the people are feasible under fin economic system in which both the public and the private sectors continue to expand pari passu, I hold the view that the objectives of full employment and social justice are attainable only under a system in which the public sector expands rapidly, and does so inversely with the private sector, until the latter is completely extinguished in all but certain limited spheres which we shall define and describe later.
In raising funds for investment sufficient to ensure full employment, both the fiscal and monetary sources should be exploited to the fullest extent compatible with sound economic and financial management.
It is important to re-emphasize, at this juncture, that the Federation of Nigeria has certain unique economic advantages which are denied to most countries in the world. We have large, self-contained, and rapidly expanding domestic markets; so far as they are known-and it is generally agreed that our knowledge of them thus far is very limited-our natural resources are vast and variegated, and our population is optimum in every sense of the word; not only do we at present have primary export commodities which, by and large, have an assured and steady world market, but it is also within our power and resources greatly to increase and diversify our export trade, and compete, fairly effectively, in the world markets for both primary and secondary goods; and it follows, in view of all these, that we have all the means, resources, and advantages for promoting and maintaining a self-contained, self-reliant, self-sustained, and prosperous economy.
The only obstacle to full employment in Nigeria, therefore, is lack of intelligent and purposive planning. In other words, all that we need for the attainment of full employment in the people’s republic of Nigeria is purposive, detailed, and scientific planning. In this regard, our strategy should proceed on two broad fronts. Our first line of action will be to ensure, (i) through tariff and other devices, that nothing is imported into this country which either we do not need or can produce locally, and (ii) that we export enough to pay for such goods (mainly capital goods) and know-how as we have to import, until we become self-sufficient and voluntarily interdependent with others in these times. Our second line of attack will be to so forge and wield our fiscal and monetary weapons as to provide and stimulate investments at home to the level of full employment, and of a decent, steadily and rapidly growing standard of living for our people.
To this end, and for other purposes connected with the attainment of our economic, educational, and social objectives, the government should establish a Fiscal and Monetary Commission manned by experts, some of whom may be non-Nigerians in the initial stages of the existence of the Commission. It would, among other things, be the duty of this Commission, from time to time, to devise ways and means of supplementing, whenever necessary, the revenues which the Governments may raise from taxation and from the earnings of enterprises owned by them, if such revenues are inadequate for its purposes.
The fourth and the fifth of the courses of action, which must be pursued in order to maintain a policy of full employment, can be dealt with together. They are: (1) Appropriate location of industries, and (2) Planned direction, and the mobility of certain classes of labour.
It is generally agreed that involuntary unemployment may arise from one or two or all of three causes:-
(i) ‘Chronic or recurrent deficiency of total demand for the products of industry.’ (Beveridge’s Full Employment, p. 124);
(ii) Injudicious and inappropriate location of industrial enterprises; and
(iii) Immobility or misdirected mobility of labour.
The first of these three causes can only be eliminated by providing investment which is adequate to ensure full employment. This we have just dealt with. As regards the second cause, granting that the survey of unemployment and underemployment, which we have suggested earlier on, is carried out, it will be the duty of the Government to see to it that appropriate industrial enterprises are located in different parts of each of the States in the Federation to ensure full employment in everyone of those parts. In other words, it should be our aim to deal with the evils of unemployment and underemployment in any part of the country in which they occur.
This course of action will, at one and the same time, dispose of a number of knotty problems which tend, injuriously, to affect workers’ minds and hence their efficiency. Firstly, it would satisfy the strong and natural predilection of most people to work in or as near as possible to their places of birth or permanent residence. Secondly, it would obviate the need, on the part of any worker, to keep two homes at the same time; and it would help to minimize the expenses incurred by the worker or his employer in paying passages or fares from the worker’s place of work to his home, during leave periods, or holidays.
Thirdly, it would eliminate the ugly and irritating phenomena of available vacancies in a given area being filled by outsiders whilst the sons of the soil remain unemployed or underemployed, and of excesses of industrial activities or vacant jobs in one State or parts-of it, whilst there are large numbers of unemployed and underemployed persons in other States or parts of them. Fourthly, having regard to their peculiar resources, all the States in the Federation would, in reality, enjoy a sense of economic as well as of political coordinateness.
CONTINUES NEXT WEEK
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