COMMENT and ANALYSIS
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THE NATION ON SUNDAY, FEBRUARY 19, 2012
Sanusi and the politics of generousity Festus Eriye
CBN governor’s problems go beyond one controversial act of generousity
efestus2003@yahoo.com 08052135878 (SMS only)
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HAT is wrong with the Central Bank of Nigeria under the leadership of Kano-born Sanusi Lamido Sanusi donating N100 million to comfort the families of victims of the recent Boko Haram attack on his hometown? Plenty, say a legion of critics: everyone from the South-East socio-cultural organisation, Ohanaeze N’digbo, to the Christian Association of Nigeria (CAN) in the 19 northern states, to activist lawyer, Femi Falana. The northern CAN described the CBN governor’s action variously as “selective” and “worrisome” and said it raised serious ethical questions. Sanusi was pointedly accused of having “exhibited sheer insensitivity to the multi-ethnic structure of Nigeria consequently taking actions that tend to set the nation on fire.” In his defence a member of the apex bank’s board, Professor Sam Olofin, indicated that the donation had board approval and was not limited to Kano alone. Apparently, a similar donation had been cleared for the families of victims of a similar disaster – the Christmas Day bombing at the Catholic Church, Madalla, near Abuja. Somehow, by a freak and mischievous design of fate, the Kano donation happened first. Now that we know that some effort had been made at recognising Nigeria’s peculiar ethnic and religious sensibilities, maybe we should just lay the matter to rest. Not so fast. Among the questions that have been asked is whether making such donations is part of the CBN’s core responsibilities. In a vibrant discussion going on online, some have argued that the bank’s enabling act allows it to perform corporate social responsibility (CSR) functions. Such a provision would place the generous donation within the bank’s remit. The governor’s friends have helpfully dished out a list of donations made to universities by Sanusi’s predecessors from the 1990s to date amounting to about N200 million. Clearly, the core mandate of the CBN is not CSR. We also know that an institution like the United States’ Federal Reserve did not throw open its gold storage to assuage the pains of victims of disasters like Hurricane Katrina or the Gulf of Mexico oil spill. No problem; nothing says we have to be as hardhearted as American bankers. Actually, I am not too concerned that Sanusi and the CBN board have suddenly been overcome with compassion, and decided to connect Kano and Madalla to the tap of milk of human kindness flowing from their vaults. I am more troubled by something in the character of the governor that keeps dragging him and the office he occupies into unending and unseemly controversies. I have always known banks to be conservative institutions. That would make the
•Sanusi
bankers’ banker an ultra-conservative entity – headed by individuals who cannot be described by any stretch of the imagination as fire-breathing radicals or wave-making polemicists. I have tried to find a parallel for the model of a central banker in the mould projected by Sanusi, and I have not found one within or without Nigeria. From Ola Vincent to Abdulkadir Ahmed, from Ben Bernanke of the US Federal Reserve to Mervyn King of the Bank of England, I have not found anyone occupying this sensitive position that is as excitable and controversy-seeking as Sanusi. My understanding is that the primary function of a central bank is to manage monetary policy. In most countries the institution is designed to be independent from political interference; by extension, its managers go out of their way to maintain that independence by conducting themselves in ways that do not encourage politicians to meddle with their freedom. Not so in Sanusi’s CBN. He is not content with sitting atop an autonomous central bank promoting macroeconomic stability. He just must jump into every raging political or socio-economic debate. In a country where dissembling and speaking from two sides of the mouth have become a national pastime, the governor’s penchant for spitting out unedited, politically-incorrect sound bites has won him quite a following. The problem is Sanusi is not a populist union leader: he is governor of the Central Bank, for goodness sake! The other day he landed flush in a vat of hot water when he tried to link the Boko Haram insurgency with supposed imbalance
“In a country where dissembling and speaking from two sides of the mouth have become a national pastime, the governor’s penchant for spitting out unedited, politically-incorrect sound bites has won him quite a following. The problem is Sanusi is not a populist union leader: he is governor of the Central Bank, for goodness sake!”
in revenue distribution in a Financial Times interview. He said: “There is clearly a direct link between the very uneven nature of distribution of resources and the rising level of violence. When you look at the figures and look at the size of the population in the north, you can see that there is a structural imbalance of enormous proportions. Those states simply do not have enough money to meet basic needs while some states have too much money.” Anyone who has tracked the rise of the extremist sect knows that it was never about hunger or the politics of derivation: it was always about religion and the desire to live in a paradise governed by Sharia law. To seek to now create some fancy philosophical backdrop for the terrorists is to really stretch things too far. Again, what was the CBN governor doing getting involved in
this? When the fire of the fuel subsidy debate was raging, there he was prancing up and down at the town hall meeting organised by Newspaper Proprietors Association of Nigeria (NPAN). Was it the CBN governor’s job to sell government’s policy on deregulation? If a CPC president takes over and scraps the policy tomorrow would he jump before TV cameras to defend the new policy? A few months ago, former Minister of Finance, Chief Olu Falae, was so incensed with Sanusi’s carrying-on during the Islamic banking debate that he said he would have fired him were he still finance minister. Falae said: “I do not have issues with Islamic banking and its establishment in Nigeria, but I’m really concerned about some of its operation and the Governor of CBN, Mallam Lamido Sanusi. When a public officer is making such political statements on Islamic banking which has several emotional attachments, it is wrong. If the governor forgot that he is governor of CBN, he should be notified.” Sanusi is no doubt a man of many parts. Long before he walked into the CBN or became CEO of First Bank Plc, he had made a reputation writing controversial newspaper articles on the merits and demerits of some of Nigeria’s major ethnic groups, and proffering suggestions for resolving the national question. There is no question that the political activist in Sanusi has been straining at the leash for too long, and is desperate to burst out of his favourite Mao suit. The call of his conservative office must be a frustrating check on this other side of the man – causing him to let fly with unwise verbal fusillades whenever he gets the itch. President Goodluck Jonathan can put the man out of his misery by firing him. Some have said he wouldn’t want to offend the north by doing so. The truth is there are many equally brilliant northern economists and technocrats working within and outside Nigeria who fit in as like for like replacement. Once upon a time Sanusi was flavor of the month with his strong opinions on every topic under the sun. But his hubris has blinded him to the fact the Central Bank governorship is not a platform for ventilating extreme views. He either zips up and continues in office, or steps down and heads for the nearest barricade with a placard: but he can no longer have it both ways.
A better way to buy politicians By Lindsay Mark Lewis
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RESIDENT Obama’s recent endorsement of a Democratic “super PAC” — Priorities USA — that will support his re-election campaign makes one thing clear: money will dominate this year’s election like no other in history. Already, Restore Our Future, the super PAC supporting Mitt Romney, has hauled in over $17 million from just 60 donors. Big money has always played a role in politics, but the advent of super PACs means that America’s presidential candidates have effectively outsourced their campaigns to the megarich. The wealthy turn over big bucks to super PACs, which in turn make whatever arguments they want, often much dirtier than anything a candidate would want to attach his or her name to. I’ve been involved in Democratic politics for two decades, and I’ve had a front-row seat to observe outside groups’ tightening grip on American elections and reformers’ repeated efforts to loosen it — efforts that I’ve always supported. Nevertheless, I’ve decided that the best way forward may be to go in the opposite direction: repeal what’s left of the Bipartisan Campaign Reform Act, commonly known as McCainFeingold, which severely limits the amount of money the parties can collect for their candidates. Doing so wouldn’t get rid of the role of money in American politics. But by channeling it back into the parties, it would reintroduce accountability to the system, the lack of which is what makes super PACs so pernicious. First, a brief history: Before the passage of McCain-Feingold in 2002, donors could give unlimited amounts of money, but only to the political parties and their national committees. No-limit donations aren’t ideal, but at least they were accountable: the parties knew who was giving, how much was given and where it was spent. Moreover, donors provided direct input in crafting a candidate’s message. Sometimes, donors got too involved, but at least they were working within the campaign, not around it. McCain-Feingold limited contributions to national party committees; it also forbade independent political advertising by outside groups within 30 days of a primary or caucus and But, as the Beltway proverb goes, money flows like water downhill, and large donors soon found a way around the law. They pumped cash into the first iteration of outside groups — so-called 527s, after a reference to the relevant section in the tax code — in the 2004 election cycle, including the infamous Swift Boat Veterans for Truth campaign against Senator John Kerry. Rules governing the new 527s were vague, and the Federal Election Commission did a poor job of designating which groups were subjected to a $5,000 donation limit as “political action committees.” Many decided to accept unlimited money regardless, risking federal fines for doing so. In January 2010, the Supreme Court ruling in the Citizens United case cleared up any ambiguity: it permitted unlimited donations to all outside expenditure organizations, which could advertise right up to the day of the election, as long as they didn’t communicate directly with the official campaign. In short, candidates have become little more than proxies, as the wealthy attack one another on issues in which they have a direct, often financial, stake: Wall Street regulation, climate change, health care and foreign policy. Candidates running for America’s highest office have no control over the potentially billions of dollars being spent on their behalf to stake out positions they may or may not agree with. But therein lies a potential solution, too. The moneymen behind super PACs may enjoy the freedom to spend money however they want, but in my experience, they would prefer the old system, where at least they knew the candidate was on the same page. The best way to return to that is to loosen the rules that drove the two apart in the first place: in other words, repeal federal limits on party donations, the one important part of McCainFeingold that Citizens United didn’t touch. Limits on transfers between party committees and candidates should also go. • Culled from New York Times