Microkhan by Brendan I. Koerner

The Sobotkas of Lagos

October 18th, 2011 · 3 Comments


Advocates for limited government appear to have a new icon in Dr. Ngozi Okonjo-Iweala, Nigeria’s finance minister, who appears to subscribe to Ronald Reagan’s fabled view on the public sector. Just check out what she’s doing at Nigeria’s ports, where an alphabet soup of government agencies have been fleecing importers and exporters alike for ages:

The Federal Government through the finance minister and leader of the economic management team, Dr. Ngozi Okonjo-Iweala last week slashed agencies at the ports to half retaining only critical agencies that would have permanent stay at the ports. She also announced the disbandment of the Customs taskforce and directed Customs to begin a 24-hour shift operation…

The agencies issued a two-week ultimatum to vacate the ports included the National Agency for Food Drug Administration and Control (NAFDAC), Federal Environmental Protection Agency (FEPA), Directorate of Naval Intelligence (DNI), National Drug Law Enforcement Agency (NDLEA) and the Plant Quarantine and Animal Quarantine (PQAQ). Others are National Environmental Regulatory and Standards Agency (NESREA), and the Standards Organisation of Nigeria (SON), the Economic and Financial Crimes Commission, (EFCC), Independent Corrupt Practices and other Related Offences Commission (ICPC), among others. Although the finance minister said there were 14 agencies at the port, most stakeholders put the number at over 20…

The reforms, the minister said were targeted at reducing cost of doing business at the seaports, which experts believe is among the highest in the world.

Corruption is nothing new to the world of maritime trade, as anyone familiar with On the Waterfront can attest. But it’s interesting that Nigeria’s problem totally inverts that which plagued the U.S. a couple of generations ago; their racketeers are government employees, rather than mafiosi.

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3 Comments so far ↓

  • Brian Moore

    There’s a whole school of thought (“stationary bandits”) that traces the origin of organized government and taxation to precisely this effect. That, when mankind shifted from hunting and gathering to agriculture, it altered the balance of power between the members of the clan (or whatever) and the leaders.

    Previously, if the clan leaders wanted to take too much from the members, they could leave and “hunt and gather” elsewhere. Or, if the clan decided to take from another clan, they could run away and still take with them at least most of the resources. With the advent of agriculture, it meant that in order to get fed, you had to be in your fields at harvest time, which meant that you couldn’t evade the primitive tax collectors, or raiders. So, farmers could be ruled because you knew where to find them — thus, all the other features of extracting rents from people evolved.

    Egypt then becomes exceptional because not only could the rulers show up at your door to ask for the grain tax, but they could even deny you the water necessary to even irrigate those crops. Early rulers then were exactly those mafiosos, the only difference being that time matured them (like a cult maturing into a traditional religion) into the governments we have today — and the new breed of mafiosi are just more recent competition. :)

  • Brendan I. Koerner

    @Brian Moore: Thanks for the thoughtful comment and the historical perspective.

    Ideally, there is a trade-off in permitting the government to monopolize skimming–namely, that the money skimmed will go (at least in large part) to providing services to those who provide consent. But because the process is entirely opaque to those being asked to fork over, it’s often none-too-clear where the proceeds are going. Over time, as it becomes apparent that government officials are simply pocketing the cash, the temptation to operate via illegal channels becomes irresistible. And those channels require “police,” i.e. criminals willing to use violence to enforce unwritten codes.

    I always think of that great quote from GoodFellas when discussing issues of this nature:

    “That’s what it’s all about. That’s what the FBI can never understand – that what Paulie and the organization offer is protection for the kinds of guys who can’t go to the cops. They’re like the police department for wiseguys.”

    At least there are no illusions when dealing with folks who are upfront about their criminality.

  • Brian Moore

    That quote is perfect — and demonstrates why Prohibition was what gave rise to their “organization,” because to changed a whole crop of people in this country from “can go to the police” to “can’t”, and so someone needed to provide that service.

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