[b]T[/b]rain more local engineers and technicians (esp under the stewardship our present natural resources)

[b]I[/b]nvest in our military capability

[b]I[/b]nvest in the marine industry

[b]I[/b]nvest in  the aeronautics industry

[b]N[/b]ationalise each and every sector that has any link to OUR National resources

[b]D[/b]evice an indigenous system of education that will focus on our local languages as a means of learning

[b]E[/b]xpand our skilled force by means of making good use of our technicians and skilled graduates

[b]I[/b]nvest in our military capability

[b]I[/b]nvest in the marine industry

[b]I[/b]nvest in  the aeronautics industry

[b]R[/b]e-visit all the ill-judged documents that have been signed away since 1960; update (where applicable) or get rid  of the many that adversely effect the economy.

[b]R[/b]e-invent the Naira

@GenBuhari
I agree wholesale. One of the greatest problems we have is ethnic intolerance

@donguutti
Yeah, planning is easier than implementation but at least we can suggest ways on how we can imlement successfully.

“You built a factory out there? Good for you. But I want to be clear. You moved your goods to market on the roads the rest of us paid for. You hired workers the rest of us paid to educate. You were safe in your factory because of police-forces and fire-forces that the rest of us paid for. You didn’t have to worry that marauding bands would come and seize everything at your factory — and hire someone to protect against this — because of the work the rest of us did.

“Now look, you built a factory and it turned into something terrific, or a great idea. God bless — keep a big hunk of it. But part of the underlying social contract is, you take a hunk of that and pay forward for the next kid who comes along.”

-Elizabeth Warren

Why do we need a financial sector? Wouter den Haan 24 October 2011

This column launches a new Vox Debate titled “Why do we need a financial sector and how much should we pay for it”. The column argues standard measures of the financial sector’s economic contribution overestimate its true value to a modern economy. As such, regulation that makes it more difficult for the sector to perform some activities is not necessarily a bad thing.

This column is a Lead Commentary on VoxEU's debate on Why do we need a financial sector?
Join the debate

According to national-income account data, financial institutions are responsible for an important fraction of what countries produce each year. A standard way to measure a sector’s contribution to GDP is to calculate its value added, that is, the difference between the value of the products produced minus the value of the products used in production.

This “value added” is distributed as income or reinvested in the financial sector.
•Figure 1 displays the fraction of US GDP produced by the financial and insurance sector. During the post-war period this fraction increased from 2% to 8%.
•The UK’s financial sector generated 9% of total British value added in the last quarter of 2008; this was only 5% in 1970.1

Figure1. Value added of the finance and insurance sectors in the US (% of GDP)



Source: Bureau of Economic Analysis

An increase in inputs (capital and labour) is only part of the story. Value added per worker has also increased substantially. Weale (2009) reports that earnings per employee in the UK financial sector were 2.1 times average earnings in 2007. In Philippon and Reshef (2008), it is shown that the rise in the relative financial wage is related to financial deregulation.

The elevated position of the financial sector is even more obvious when we take a look at corporate profits.
•In the first couple of decades following the Second World War, profits in the financial sector were around 1.5% of total profits;
•Recently, this number was as high as 15%.

Pay versus output

Without doubt, these numbers indicate that the stakeholders in the financial sector (employees and investors) receive a substantial chunk of GDP. But the numbers do not necessarily imply that the sector produces this much. Nor do they imply that the actual value of what the sector produces has gone up a lot during the post-war period.

To understand why there could be a difference between the income received and the value of what is being produced, consider the basis of this deduction. In a competitive economy, the price of a good equals its marginal cost, and consumers buy it up to the point where their marginal benefit equals the price. If it is an intermediate good, the price equals the value of the good’s marginal productivity to the purchasers. Thus, the value of output works well as a measure of both the cost and the benefit to society. That’s the magic of the market.

However, if the sector is imperfectly competitive, the price will exceed the social marginal cost and we’ll see value added being artificially transferred between sectors. As the financial sector is very concentrated, this is one reason we should expect the payments to factors in banking to exceed the value created – taking, as a base case, the prices that would be observed if the sector were competitive.

A second wedge between wage and value arises from the implicit insurance that the financial sector gets. As financial service providers do not pay for the “moral hazard” they create, the true value of financial services is systematically less than the payment to factors. Curry and Shibut (2000) calculate that the fiscal cost, net of recoveries, of the 1980s US Savings and Loan Crisis was $124 billion, or roughly 3% of GDP. This cost ignores other costs such as output losses, and this was a relatively mild crisis. Laeven and Valencia (2008) consider 42 crisis episodes and find an average net fiscal cost of 13.3%.2 It would not be fair to attribute these losses solely to the financial sector, but the magnitudes of the numbers suggest that this wedge could quantitatively be very important.

A third wedge comes from negative spillovers. The financial sector may provide services that are useful to a client, but not to society as a whole. For example, a financial institution may help to structure a firm’s financing in such a way that the firm pays less taxes. Such a transaction would not increase production, unless lower taxes help the firm to produce more. Nevertheless, such transactions will count as value added generated by the financial sector. A rather stark analogy could be drawn with the cigarette industry, where it is quite clear that the payments to factors do not really measure social value added since the cost of smoking-induced health problems falls on the taxpayer (in most nations).

Although the sector’s contribution is not easy to measure, there are some things we do know.
•First, the financial sector provides useful services. That is, the sector’s value added should be positive.
•Second, financial-sector value added reported in the national income accounts was probably overvalued in the years leading up to Great Recession.

The financial sector extracted huge fees from the rest of the economy to construct opaque securities that were so complex that only a few understood how risky they were.3 If fees (prices) had accurately reflected the true value of the products, then some of these fees should have been negative, since many such products were not beneficial to the buyer or to society as a whole.

Several important questions need answers.
•What are the reasons for the observed substantial increase in the share of GDP received by the financial sector?
•What are the services that the financial sector in today’s world does (or should) provide that increase the production of things we care about?
•What is the value of these services? This is a tough question for the type of products delivered by the financial sector, because the nature of the services changes over time. For products like computers, we can measure characteristics such as speed and memory and measure how much computing power you get. If a bank becomes better at preventing default, then it provides more “financial services” for each unit of loans issued. But how can we correct for such changes in risk exposure? One possibility to measure the effectiveness of the services provided is to investigate how differences in financial sectors across countries are related to valuable characteristics such as smaller business cycles, better life-time consumption patterns, and innovative firms not facing financing constraints.4

What is the value of modern finance versus traditional finance?

Although the financial sector has been in the limelight since the outbreak of the crisis, these questions have received little attention. There is a substantial academic literature investigating the positive (and negative) effects of the presence of developed financial markets on long-term growth.5 But there is not that much research done on the question of which aspects of the current financial system are important for today’s economies.

One would think that it is essential to fully understand what contributions the financial sector, and especially banks, can offer before engaging in a discussion on how to regulate this sector. If the key aspects of the financial sector that foster growth are relatively simple, then we would not have to worry that, say, increased capital requirements would have negative impacts on the economy. Then it would make more sense to worry about there being enough competition, so that we do not pay a lot for relatively simple activities. But if sustained economic growth requires a creative financial sector capable of performing complex tasks, then we should worry that regulation is not going to debilitate this sector.

It is surprising that these questions currently get so little attention. In an abstract sense, we know what roles financial institutions fulfil. In particular, (i) financial institutions avoid duplication both when monitoring loans and collecting information, (ii) they help to smooth consumption, and (iii) they provide liquidity.6 There are many enjoyable descriptions of some activities enacted in the financial sector that seem hard to reconcile with the laudable tasks thought of by economists. Moreover, knowing what the tasks of the financial sector are in theory does not tell us whether those tasks are fulfilled efficiently and at the right price. Nor does it tell us why the income earned by the financial sector has increased so much. As pointed out by Philippon (2008), in the 1960s outstanding economic growth was achieved with a small financial sector. Has it become more difficult to obtain information so that we now need to allocate more resources to the financial sector?

Some articles in the literature address the questions posed here. Chari and Kehoe (2009) use US firm-level data and find that the amount spent on investment exceeds the amount of internally-available funds (revenues minus wages minus material costs minus interest payments minus taxes) for only 16% of all firms considered. If investment could in principal be done using the firms’ own funds, then the role for financial intermediaries is obviously diminished. Haldane (2010) discusses in detail the earnings of the financial sector and concludes that “risk illusion, rather than a productivity miracle, appears to have driven high returns to finance”. Philippon and Reshef (2008) study wages earned in the financial sector and conclude that a large part of the observed wage differential between the financial sector and the rest of the economy cannot be explained by observables like skill differences, but is likely to be due to the presence of rents. Philippon (2008) argues that an increase in the types of firms that invest (young firms) can explain part of the increased income share of the financial sector; the increase in the last decade remains puzzling.

A similar view is expressed by Popov and Smets (2011), who argue that deeper financial markets in the US relative to those of the European continent are, to a large extent, responsible for the larger increases in productivity and faster pace of industrial innovation. One piece of evidence supporting this view is the empirical study of Popov and Roosenboom (2009), who find that better access to private equity and venture capital have a positive impact on the number of patents. Den Haan and Sterk (2011) reconsider the popular hypothesis that innovations in financial markets should make it easier for financial institutions to smooth business cycles. The idea of this hypothesis is that better access to bank finance ensures that consumers and firms do not have to make decisions that are bad for the economy as a whole, such as firing workers or postponing purchases which in turn could trigger additional layoffs. Den Haan and Sterk (2011) analyse in detail the behaviour of consumer loans and real activity, and find that there is no evidence that supports the hypothesis that financial innovations dampened business cycles, even when the recent crisis is excluded. Lozej (2011) addresses the same question using firm loans. Although the evidence presented by Lozej (2011) is a bit more mixed, there is at best weak evidence that the changes in the financial sector contributed to smaller business cycles during the period before the recent crisis.

Conclusion

The literature indicates that some tasks of the financial sector are beneficial, some attributes of financial institutions matter, and others matter less so or not at all. The recent publication of the Vickers report is a good occasion to investigate what activities of the financial sector are beneficial for today’s way of life, and whether they are affected by proposed regulation. Without doubt, various proposed changes in regulation will be costly for the financial sector and make it more difficult for the sector to perform some activities. But that is not necessarily a bad thing. If a change would cost the financial sector, say, one billion a year but does not affect the total amount being produced, then it just means that there is an extra billion for the other sectors.

Article culled from http://www.voxeu.org/index.php?q=node/7149

We need an Infrastructure database where everyone can upload pictures and videos of the state of the infrastructure so that the government can take appropriate action against the perpetrators of crimes like shoddy workmanship et cetera.

Federalism
More money spent on primary/secondary education
FG hand off the roads to states
FG deregulate electricity
6 regions rather than 36 states
Resource control for regions/states
No more national collection of VAT, let regions/states collect their own
Regional police

On point ekt_bear

We have too many states, 6 regions instead of 36 states is the way to go,
It's as if you read my mind,
This morning I was thinking about a system where states can merge into bigger states, for example states like ekiti have no business being states, they are almost totally dependent on FG allocation.

A document similar to the declaration of independence by America's founding fathers that captures the spirit of Nigeria's democracy.
This document will be binding on every Nigerian including all elected officials.
The document will have to be explained to and ratified by every ethnic group leader in Nigeria.
Every king, chief, or other traditional ruler will ratify and sign the document.
The document will have to be publicised much more than the Justice UWAIS panel report.
The document will proscribe some sort of Sovereign National Conference which states will have excluding the right of secession.

The document will not try to solve all problems, it will just prescribe a general philosophy on which our democracy will be built on.

We need a document such as the above so that our elected officials will not be able to legally hold us to ransom like they currently do.
The constitution of Nigeria, is too big to fulfill this need. Another point to note is that the first constitution was not ratified by everyone. It was created by Nigerians that were selected by the british.

Widespread and far reaching debates among intellectuals and academics will have to be done to facilitate this kind of project.

Funding for the project will only come from Nigerians and will be published on the website,
Detailed Spending will also be published on the website.
All contributions and debates will also be published on the website

Creation of this document is a project to be carried out by civil societies in Nigeria. Enough is Enough.

When this document is finally created, we will need some system to make it Law. This means we will have to sensitize ordinary Nigerians to compel their senators to pass the document as LAW.
Nigerians should organize protests to hold the National Assembly to ransom until they pass the document as LAW.

On the issue of fuel subsidy removal,

We need to craft a way of drastically reducing our dependence on international organizations like the IMF, WTO and World Bank.
Removal of most subsidies are fundamental rules in the IMF and WTO, can you imagine!!!

the hard truth is that the IMF and WTO are run at the behest of a few global corporations and any country that values the well being of its citizens should be almost independent of these organizations, that doesn't mean we won't trade.

We have to come up with a more humane and democratic version of Col. Ghadaffi's ideologies. It may be hard, but nothing worthwhile in life comes easy,
That's what brillant Nigerian political economists together with political and economic professors should be working on non-stop day and night!

The reformation of the constitution has to start from the Academia not just some copy and paste from the constitutions of the other countries but a look at the history and culture of all the different ethnic groups in Nigeria to come up with a fundamental premise on which to build our democracy.

Our engineering professors together with business and finance professors should be focused day and night on how to stimulate our manufaturing and energy industries in a way that brings the most returns to average Nigerians,

People who do the above should be the ones getting National honours rather than just anyone who has enough visibility!

@logic1
well done for your efforts on this thread.

Buhari in 1984-85 rejected IMF loan but instead entered into Barter Trade Agreements with four countries to supply essential imports in exchange for oil to negate the need for the money we were lacking.

@GenBuhari
Exactly what I was thinking about!

We are lucky crude oil is still very much in demand in the global market. We should use the prevailing demand for crude oil to our advantage rather than tout ourselves and our resources as commodities for sale!

Barter Agreements between nations is the way to go rather than depending on global banks who don't have the interest of any nation at heart.

Political Apathy And Nigerian Democracy

fundamental question often asked by scholars and students of politics in Africa is the possibility of having an ideal and enduring democratic society. Democracy originated from...

http://www.scharticles.com/political-apathy-nigerian-democracy/