*Says allowing AMCON to exist in perpetuity is a moral hazard
On Monday, February 26, Prof Kingsley Moghalu, former Deputy Governor of the Central Bank of Nigeria (CBN) and President, Institute for Governance and Economic Transformation, will launch his new book, BUILD INNOVATE GROW (BIG). A Vision for My Country.
But before then, The Niche trio of Ikechukwu Amaechi, Oguwike Nwachuku, Alex Emeka-Duru, sat him down for over two hours to talk on a long range of issues affecting Nigeria’s economy. The interview is as explosive as it is revealing.
The former Professor of Practice in International Business and Public Policy at the Fletcher School of Law and Diplomacy at Tufts University in Massachusetts, USA, knows what the issues are and pulled no punches.
Here, we bring you excerpts from the first part of the interview.
Many Nigerians know you more as a former Deputy Governor of the Central Bank of Nigeria (CBN). Aside that, not much is known about you. Who really is Kingsley Moghalu?
There is more to my life beyond my time at the CBN, although my time there was very important part of it because it was my main experience at national public service.
Before the Central Bank, most of my professional career was in the United Nations (UN), where I served for 17 years, rising from entry level to the highest career rank of Director. I served in strategic planning and political affairs, legal affairs and development finance roles at several duty stations. I served in New York, the UN Headquarters, I served in Cambodia, Croatia, Tanzania and Switzerland.
After my time at the UN, I went into the private sector as an entrepreneur. I set up a consulting firm called Sogato Strategies in Geneva, Switzerland, at the beginning of 2009. And that went well. But within six to nine months after, I was head hunted back to join the Central Bank by the President, Umaru Yar’Adua (late), through Sanusi Lamido Sanusi (Emir of Kano), who was the Governor of the bank at that time. So, Sanusi was the person who invited me and recommended me to Yar’Adua.
My life experience has been very deep and wide in a number of sectors other than finance and economic policies.
I am very experienced in international diplomacy; I am very experienced in nation building. A lot of my time in the UN, I was on assignments in leadership roles to reconstruct broken nations, whether it was in Cambodia, Croatia or Rwanda, after the genocide.
At the time I was in New York, the UN Headquarters for three years from 1993 to 1996, I was Political Desk Officer for Rwanda, Angola and Somalia. I also spent a lot of time in development finance at the Global Fund in Geneva from 2002 to 2008. And we raised up to $20 billion for social interventions in developing countries, including Nigeria, in the area of public health, to fight Tuberculosis, HIV/AIDS and Malaria.
I was also in the Risk Management Committee. I helped develop the Risk Management Framework of the Global Fund. When you handle such a large amount of money, risk management must come in.
It was actually my risk management background that led to Sanusi inviting me to come back home and serve the country as Deputy Governor of the Central Bank.
What have you been doing since you left the CBN?
After the CBN, I was appointed a Professor of Practice in International Business and Public Policy at the Fletcher School of Law and Diplomacy at Tufts University in Massachusetts, USA.
The Fletcher School is the oldest, exclusively graduate school of international affairs in the United States. And it is one of the top three graduate schools of international affairs in the world, alongside the Georgetown School of Foreign Service, at Georgetown University and the School of Advanced International Studies at John Hopkins University.
The Fletcher School is a place where a lot of leaders around many countries of the world have been trained over the last seven or eight decades. So, it was a very singular privilege to be appointed a Professor at such a prestigious School, based on, not just the work I had done at the United Nations, but a lot of it, based on the work I did in Nigeria as Deputy Governor of the Central Bank and based on the book, my third book, which I wrote while I was Deputy Governor of the CBN – Emerging Africa: How The Global Economy’s ‘Last’ Frontier Can Prosper and Matter.
In fact, the course I was teaching was called ‘Emerging Africa in the World Economy.’ So, it is very interesting that such a school asked me to come and be a Professor based on the book. Nobody in Nigeria invited me to become a professor and teach Emerging Africa.
You can then see why these societies are far more advanced than ours? They have a very deep appreciation of knowledge. And they make use of it to advance. Here, we are rather busy with some other things.
Before all these, where were you coming from and how did your background influence your life philosophy and worldview?
When it comes to my personal background, which has informed my character a lot, that is very important. That’s far beyond being Deputy Governor of the CBN. I am someone who believes that the purpose for which I live on this earth, the purpose for which God created me, is to change the human condition for the better. My purpose is to make life better for my society, for any organisation or any institution I come in contact with and to leave it better than I found it. That’s my personal philosophy. I have a world view of excellence.
I have a world view of transformation. I have a world view that believes that the human will can change the human circumstance, if that will is translated into proper organisation and proper understanding.
People must first understand, then they must organise and then, change their environment. This world view is what drives me. And it is the type of world view that has created change in Western countries and in Asia. That is the type of world view that I have.
My family background was also very important. My late father, Elder Isaac Moghalu, was one of Nigeria’s pioneer Foreign Service Officers in the 1960s. He was a very honest civil servant – a man of integrity, who had a good name. He believed that good name was better than riches, gold and silver. I grew up with that attitude, as well, that one’s integrity and reputation, should not, as much as possible, be sullied by chasing after material wealth in the wrong way.
My father’s favourite boast was that he served as a civil servant for 35 years and never took a bribe. That’s what I remember a lot about him. And this influenced my world view that a good name matters more than material wealth.
It does not mean that it is bad to be financially comfortable. So long as it is legitimately acquired, that is fine.
I also grew up with an ethic of hard work. That is why when you look at my track record, you will see from Point A to Point Z, exactly how my life has gone. There is nothing in my working life, since I left university that cannot be accounted for.
We need more of that. We need to come back to that in this country, because you now find people, who, all of a sudden show up with a lot of wealth that nobody knows the source, raising a lot of hidden and unspoken questions. But people will take that wealth or benefit from it, without asking questions.
This is one of the reasons why our society has gone down. The value system has been completely destroyed by worship of mammon and material things, instead of a focus on hard work that used to be the case decades ago.
You are a lawyer, diplomat and economist. Which of these, would you say, has impacted most on you?
The economic aspect of my life’s career because it is the one that directly affects the people’s welfare the most. I believe not just in economic growth in terms of Gross Domestic Product (GDP). I believe in economic development. There is a difference. I believe in economic transformation. How do you take millions of people from poverty into the middle class? That is my vision for Nigeria. That’s what drives me, today. That was what drove me to write Emerging Africa which some people say is the most intellectual work I have produced although I have another one coming out on February 26 titled Build Innovate Grow (BIG). A Vision for My Country.
The Diplomacy side was also very important because nation building is a necessary foundation for economic development. I learnt how to rebuild divides, how to reconcile broken nations so that they could begin to grow.
In Rwanda, we see where they are now. They are doing much better. There was a time they were known for genocide. Today, they are known for business, success and development. That is how you can change the narrative. But that is because first of all, they, themselves decided to stabilize their own country and reposition for the future because of the type of leadership they have.
You may say that their President, Paul Kagame, is controversial but I must tell you that I respect what he has achieved. I think he is one of the very few African leaders that have a clear world view. They are not more than four, in my own view.
Would you say that the CBN that you served in was able to tap into this world view and drive that vision?
Oh yes! Clearly! It was Sanusi Lamido Sanusi, who was the governor at the time. But we had a collegiate leadership structure called the Committee of Governors, comprising Sanusi and the four Deputy Governors. We sat and deliberated over every policy and agreed before it was implemented.
We were Deputy Governors, not assistants. Some times in Nigeria, people don’t understand the difference between a deputy and an assistant. That’s why you always have problems between governors and their deputies; presidents and vice presidents.
Of course, there will always be one ultimate leader. That is given. But at a certain level of seniority, there must be some collegial approach to governance, so that the views and opinions of not just one person, are synthesized into what becomes a policy.
This is a very important secret of leadership that it is not the “I” alone that will do it but it is “We” that will do it. It is the collective. How do we tap into everybody’s wisdom? How do we tap into everybody’s capabilities to generate success? These are the critical questions.
So, in the CBN of our time, Sanusi was the Governor, I was one of the Deputy Governors. And we worked very well, together. We had a clear world view of economic transformation in Nigeria.
But unfortunately, the mandate of a Central Bank is limited. It is limited to being the monetary authority, and in the case of Nigeria, to being the financial sector regulator. The Central Bank does not cover fiscal policy. It is not the Central Bank that does what would be the budget of the Federal Government for 2018, for instance.
The Central Bank, also has the responsibility, as a financial adviser to the government and a banker to the government. But if the government does not take the advice of the Central Bank, well, the bank cannot enforce its advice.
But within the narrow limits of monetary policy and financial regulation, we were able to transform the Nigerian economy, in the sense that after the global financial crisis, we stabilized the banking sector. No Nigerian lost one kobo, no bank failed. That was part of our world view – that we need a stable financial system and I was the Deputy Governor for financial system stability. We need a stable financial system for Nigeria’s economy to grow. We were able to bring inflation down from double digits to single digit because of our successful monetary policy at the time. The Naira was broadly stable for the five years that we were in office, because, again, we managed the forex policy well with policies that attracted portfolio influence into Nigeria. It helped to keep the currency stable.
But beyond this – and this is what I reflected in Emerging Africa – there is a lot more to economic transformation beyond these two or three things that I have mentioned. And the most important is the philosophical foundation of economic thinking, which is not the Central Bank’s role. It is the role of the political leaders to articulate and espouse such a vision. But we have not had that done in Nigeria, very successfully.
How do you mean?
I believe that an economy must be driven by an economic philosophy, which is consistently applied in economic management. That has not happened in Nigeria yet and it is one of the reasons why we are always running around in circle because we are very short-term and adhoc in the way we think.
I also believe that the political leadership in Nigeria must have a greater intellectual understanding of economics and political economy because without that, you cannot transform a society. You can’t! Our poverty rate is 62 percent. About a hundred million Nigerians live on less than a dollar a day. The needle hasn’t moved, government after government.
Why?
It is because we deal with things on the surface. There is no intellectual and conceptual depth and consistency in the leadership of Nigeria’s economy.
Who do you blame for that?
It is the political leadership, because the political leaders have largely been incompetent. They don’t have the capacity. That is why I am saying that from 2019, this game has to change. We need to begin to look at people in terms of their character, in terms of their capacity, in terms of their competence, in terms of their track record.
If you had read Emerging Africa, for instance, you would see that the level of that discussion, is not the level of discussion that is happening in the government of Nigeria. Things being discussed are vested interest, how to get this or that, ethnic groups, religious issues and things that are divisive. There is no world view that can unite the whole country. And that is the failure of the political leadership and that must change because it is with unity that you can have development. It is with unity that everybody can be pulling in one direction. It is because of the too much fissiparous tendencies as we have in Nigeria today that the country cannot develop. That is why, in my view, the constitutional restructuring of Nigeria, is an inevitability.
It must happen because there is too much concentration of power at the centre. And that is why the politics of the country is always geared to who will capture power in Abuja. Meanwhile, this is a very big country.
So, we must decentralize power in Nigeria, so that people can become more accountable at more local levels for the exercise of responsibilities and states cannot sit around waiting for allocations from Abuja every month. That is a system that leads nowhere.
Asset Management Company of Nigeria (AMCON), is one of the fall-outs of your era in CBN. You also did a lot in the area of corporate governance in banks. Can you say that AMCON, as it is, is living up to its name? Can you also say that that the banks are stronger today in terms of corporate governance?
AMCON was established to help us stabilize the banks by issuing bonds and recapitalizing the banks, so that their toxic assets would be removed from their balance sheets. That way they will have the confidence to start growing and lending again. They will not be impaired.
AMCON also helped us to recapitalize some of the banks by bringing their negative asset value which was below zero to zero and then other investors could come in to either take over those banks or there could be a merger or acquisition.
In those two broad senses, we were successful in our own era.
But at the time, we felt that AMCON should have a life time of about 10, 15 years but eventually, I think that was removed in terms of specific time frame. But the plan was that AMCON would continue to operate up to 2023 or 2024.
There is one issue about AMCON, which I want to be very clear about. And this is my own personal opinion. I always felt that allowing AMCON to exist in perpetuity in such a manner that it could be brought back to help the financial system, was a moral hazard.
Moral hazard is a situation where there is an incentive for people to indulge in hazardous behaviour in the knowledge at the back of their mind that there is something that would bail them out. I feel, personally, that, that is not the best way for us.
I also feel that even though we did the right thing by making sure that no bank failed when we were there and ensuring stability, that we cannot continue on a policy of no bank fails because that means that, again, that’s a moral hazard. What we should do – we started that work and I don’t know how far it has gone now – is that the Central Bank should develop “Wills” for the banks. What that means is that banks should be required to write a will, if you as a bank want to collapse, this is how your funeral should be arranged. That is my own view.
It should be done in such a way that the depositors are protected, but the creditors and shareholders come second and third in terms of their claims to assets. The creditors come next after the depositors and the shareholders come last. Banking is a business, like any other business. If you invest in it and it is not well run, it should be able to fail.
The reason why we didn’t want banks to fail is that banks are also a peculiar business because when they fail, the consequences are not like the consequences of other business failures. That is why risk management and corporate governance in the banking sector becomes extremely important.
We decided to protect depositors because of the social consequences of bank failures in a poor country like Nigeria. In the 1990s, we had failed bank crisis. We know that many families are still suffering from it up till today because of the irresponsibility of crooked bankers, who were just playing kalo-kalo (gambling) with depositors’ funds. And when the thing failed, they moved on to other things in life – some became ambassadors, some became senators or whatever – but the poor depositors were left holding the short end of the stick.
That was what Sanusi and I and other colleagues, decided, would not happen under our watch at the Central Bank and it was a correct approach.
So, how stable are the banks in Nigeria this time, I don’t know because I don’t have the details of their books any more. But my sense has been that the financial sector has remained broadly stable but not as strong as we left it.
I am pleased to see that the CBN has said that if you have a very high ratio of non-performing loans, you should not declare profit to shareholders. I think that is actually a very correct decision. It’s a very recent decision and I support it.
But to address this question a little bit more. The more important question about the financial system in Nigeria is that there is no philosophical underpinning, forgive me, I always come back to this. I believe in philosopher kings because that is how every nation that has prospered has prospered. It is only in Nigeria that people think that intellect and conceptual thinking is a crime. But if you cannot conceive it, you cannot do it, you cannot execute it.
The reason why we were able to stabilize the financial system is because we had a concept of financial stability that was an intellectual construct, based on what we got from experiences in other places, especially Malaysia, which was where we took the idea of AMCON from. They had something similar but we improved on their model.
There is no philosophical understanding of the role of finance in the Nigerian economy. When Nigeria’s economy was liberalized, which was a good thing, we did not go far enough, in terms of setting the priorities – the different factors of production – that is land, capital and labour. There was an emphasis that shifted to capital but we forgot about labour, we forgot about land, we forgot about other things.
So, the banking industry mushroomed in Nigeria, but in the wrong way. It was not financing for development, it was trading in foreign exchange to make profit. That whole trajectory in the Nigerian banking system, has still not been resolved till date. It is a contradiction. It was one of the reasons for the consolidation of the banks to address this problem. And that went a long way. But we still have not finally resolved the problem because the banks are big, they are robust, they are strong and stable.
But are they able to actually finance development?
That is the question. But is it actually the role of the banks to finance every small business? Are you not looking at the wrong place? Nigeria’s banks provide up to 90 per cent of the capital in the Nigerian financial system. That is wrong. We need more venture capital funds in the system. We need more private equity in the Nigerian economy. That is not happening as much as it should. Venture capital is not credit. It is equity. And that is what a lot of small businesses need to be able to grow and create jobs. But they don’t have it. So, they just go and take these loans at percentages of repayment that are killing.
Don’t you think that the incidence of high interest rates is also a factor militating against growth of business?
Of course, yes! But why do we have high interest rates? Let me explain. In the first place, the infrastructure in this country is very weak. Because of this, the cost of money is very high. Let me give you an example. Every bank in Nigeria runs on power generating sets, every bank branch runs on at least two generators 24 hours, every week. The same applies in other businesses. The cost of everything in this country is at least 30 to 40 per cent electricity cost factored into it. So, unless we address that infrastructure conundrum, production cost will remain very high.
Secondly, interest rates are high because of monetary policies; because we had to tighten the money supply in order to control inflation at a certain time. Whether we should continue along that trajectory, is of course, a different debate that is taking place now. There are some people who feel that we should lower monetary policy rate and have some inflationary growth. It does not matter if we have inflation but let people have access to capital at a cheaper rate. But that is an intellectual argument, and there is necessarily no right or wrong answer but some countries in Asia have also had inflationary growth or developing countries like Brazil.
Those are the two issues with the high interest rate – the infrastructural problem, the monetary policy problem and also, the banks themselves, some of them are too greedy for profit. That is one of the reasons we see excessive bank charges. When I was the Deputy CBN governor, under my directorate, we were able to recover N14 billion of wrong and excessive charges on customers by banks. So, the sharp practices are just too much and that is why we have regulation anyway so that eyes could be kept on these bankers.
That’s the overall view on the high interest rates. We should try and bring them down. Inflation is coming down. I am hoping that by the end of this year, sometime next year or maybe after the elections, the CBN should definitely go into an expansionist monetary policy – not tightening but reducing the interest rates.
Inflation may still spike temporarily in 2018 because of the way politicians spend money for elections, it is possible.
Do you see the current CBN leadership having the political will to do what you are proposing?
Well, let me say that I don’t want to judge my successors or colleagues in the bank. I don’t think it is fair to conduct a final and definitive judgement on their competence or not. I may support some of their policies and I may also criticise some of their policies. I have just told you that I support their decision that banks with very high ratio of non-performing loans should not declare profit to shareholders but I have also been critical of what I consider the loss of independence by the CBN in the last three years. So, it depends on the issue but I don’t want to get into blanket assessment because I deal with the system not individual.
You earlier identified failure of the political leadership as contributing to the problems in the financial sector. How do you think we can get out of the situation?
That is very important because without getting it right politically, we will not get it right economically. This has been my experience and I learnt this after I left the CBN. With my reflections on my experience while I was a professor, and looking at the Nigerian economy from a certain distance, I was able to come to the conclusion that the real problem we have in our economic management is actually our politics. Because the politics distorts everything. So, how we can get it right is that when there is a leadership failure, the citizens must step in. Normally, it is the role of the leader to set the direction in which the country should go but if the leader is not capable or the leaders are not capable, the citizens must act. So, Nigerian citizens must become politically engaged. They must become politically active by making sure that they are registered to vote because that vote has its power. It is a power that you can use to hold governments or the performance of political leaders accountable.
And I think we must retire the current political class in Nigeria. If the country is to make any progress, we must retire them at the ballot box because, certainly the leadership of today is incompetent, visionless and divisive.
Are you not being overtly idealistic in your propositions knowing the nature and character of Nigeria’s politics and politicians? Votes don’t count, we are all aware of the underage voting phenomenon. So, how are you going to retire them?
We must keep voting until our votes count. That is my answer to the question. There is no room for surrender. It is a war. The politicians have Nigerian citizens in a vice grip. We must fight for our freedom. We must fight to extricate ourselves from their vice grip of systemic vote rigging which is symbolised by what happened in Kano.
Any victory obtained by underage voting is a fraud and must be seen and condemned as such.
But it happened in 2015 and we moved on, so why will it stop now?
That is true. But there wasn’t such an outcry then as it is now. It shows you that there is an evolution taking place. People are screaming and INEC is now on the defensive. We must hold our institutions accountable. We cannot just let them do whatever they like.
And if they are ignoring these kinds of things, then they are not doing their jobs and Nigerian citizens must rise up. We must keep the pressure on INEC to conduct free and fair election come 2019. We will not accept rigging of any type – structural like underage voting or otherwise.
You say lack of political will and vision is responsible for our economic stagnation, but I remember that President Goodluck Jonathan handed over the economy literally to Ngozi Okonjo-Iweala, who came from the world Bank. Would you also say she didn’t know what the issues were?
You are wrong. Let me tell you why. First Okonjo-Iweala in practice was not in control of the oil economy. She didn’t have, as far as I know, access to the accurate financial situation with Nigeria’s proceeds from the sale of crude oil.
Second, Okonjo-Iweala was in-charge of the economy during the day, but not at night. At night, the politicians would meet and take decisions which she was not part of.
This is why I keep saying that the problem is with the politics. It is not about finding technocrats. We have had enough technocrats in Nigeria and that is why I believe that technocrats should now enter politics and take political power so that if you have a technocratic vision of how the economy can be fixed, you have the political power to actually execute it.
If you are just submitting recommendations to politicians who have other plans and agendas, then I am sorry, you will not get very far.
So, remember what I said, Okonjo-Iweala was in-charge of the economy during the day but not at night.
You keep harping on venture capital and all that, but why hasn’t privatization worked in this country?
The concept I have of public/private venture capital is this, the federal government is spending N500 billion or so they claim because they have budgeted for it, on social intervention fund. It is a pipeline of corruption, waste, fraud, and inefficiency. I am looking for the people who benefitted from the N5,000 a month intervention or whatever, I cannot find them.
Secondly, there has been newspaper reports that the officials in charge of these programmes have admitted that there is a lot of fraud and waste going on. So, I have been vindicated in what I am saying.
From an economic perspective, it is useless to create a N500 billion social intervention fund in which you claim you are giving people N5,000 every month. In economics we call it exhaustive transfer that does not create growth in itself. You give somebody N5,000 and the person will chop it and that is it.
They also claim that they are doing school feeding programmes and somebody did a breakdown and per capita receipt from the school feeding programme was N6,000 per child. Na wetin the pickin de chop? And somebody also did a per capita receipt breakdown about the budget that each prisoner gets N14,000 a day.
This is inefficiency because they want to create a pipeline for political supporters, relatives or all sorts of people to get rich but in terms of what will actually help Nigerians, the venture capital fund is better because you invest in businesses that produce a proper business plan.
And if these plans are produced by people who are unemployed, and they receive that investment so that the venture capital investor has equity but a young unemployed man or woman has the capital to start something new and productive, that business will employ one or two people, eventually they may be three or four, maybe ten.
This is how employment is created. It is businesses that create jobs. The government itself does not create jobs. We are no longer running a command economy. So, the venture capital fund should be structured like this.
The government invests N500 billion, provides the capital for the fund, the private venture equity firm or firms will be partners, either bringing additional money or their expertise. So, the government is an investor and getting some return from the profits from the ventures they have funded. But the private sector arm of the partnership actually manages the fund. I don’t want the fund managed by the government because once you have that especially the federal government you have in Nigeria today, inefficiency, nepotism, and corruption will be the result.
People will be getting investment not on the basis of their business plan, but where they come from and how related they are to people in power.
You don’t want that. You want the private sector managing the fund so that they can actually begin to create growth and jobs. This is what I am saying because venture capital is what has created the wealth of the western world and Asia.
But how do you take care of the greed of some private sector managers like banks?
That is why I said it should be a public/private sector partnership. Because if it is and the public sector side of it is managed by competent people, they will bring a social perspective, impact investment perspective that this fund will be used to wipe out poverty.
Again, our foreign reserves is rising and people are jubilating, what exactly does rise in foreign reserves entail? Does it make for economic stability?
Foreign reserves are important for economic stabilisation because that is where imports are financed from. So, a country must have enough foreign reserves to finance imports for a minimum of three months, best if it is minimum of six months. That is why foreign reserves matter because it becomes a gauge for the economy’s ability to withstand adverse circumstances.
Another function which the foreign reserves of Nigeria have traditionally served is to affect the weakness or strength of the Naira. But this is where the problem is. When we were at the CBN, the stronger our foreign reserves, the stronger our Naira, but we have a lot of foreign reserves now but the Naira is still weak and sliding. Why? It tells you that something is not quite right. Forget the propaganda, investor confidence in this economy is not anywhere near where it should be. It is very low. And the amount of foreign capital that is coming in, which is part of what determines the level of the Naira is not anywhere where it should be.
Let us also talk about the value of the Naira. The value of the Naira has been largely determined by the price of oil because that is the only thing we are exporting. Ninety per cent of our foreign exchange income is from oil. But I am suggesting that that is defensive economics. We need to go on the attack in terms of true wealth creation in this economy.
So, I am not impressed by the level of reserves. I am more interested in what is the poverty rate. What is the unemployment rate? These are the real things that affect the life of every citizen in the street. It is not the amount of foreign reserves that you have.
This is an elite discussion but I am going to the fundamentals because I am interested in economic development. I am not impressed by the fact that Nigeria’s GDP has grown by 1.4 per cent in the third quarter of 2017. It means nothing where the structural and conceptual management of the economy has no real vision, no real strategy, and people are confusing you with all these statistics. It is all motion, no real movement.
This is where I stand in all these discussions and this is a post-CBN conversion. In the CBN, I was more focused on classical economics, though I was also an economic thinker, that was why I wrote Emerging Africa, but now, I believe that economic thinking and economic philosophy matter far more than classical economics because classical economics has some issues.
They tell you that they assume that every man is rational but the man who just won the Nobel Prize in Economics has demonstrated that there is no such thing as rational man. That is one of the reasons that he won. So, contrary thinking is important.
Adam Smith who wrote the Wealth of Nations was a political economist, he was not a classical economist, there was no such degree as economics at that time. He was a moral philosopher. Maynard Kings studied classics and mathematics. But he was the greatest economist of the 20th century.
Therefore, the argument is not whether everybody in President Muhammadu Buhari’s government has a degree in economics, that is important and you need people with economics degrees because they are statistical, there are equations that have to be done to support policy, but at the leadership level, what matters is the conceptual philosophical thinking. Gordon Brown was the Chancellor of the British Exchequer for 12 years, he is a historian.
So, the person or persons who are in-charge of the economy may be economic degree holders or they may be not. The more important thing is that they must be economic thinkers.
