Self-perceived populists, experienced politicians and President Ellen Johnson Sirleaf are focused on the 2011 elections, while the World Bank, through President Sirleaf, is instituting Wall Street type of economic system (earning quick profits at the expense of society) in Liberia. With such an economic system, coupled with the rush at which President Ellen Johnson Sirleaf is selling Liberia’s natural resources on the cheap, would the 2011 president, generate adequate revenue? Additionally, would the newly elected president institute policies that would encourage profiteers to provide services at reasonable prices across the nation if government-managed utility entities are sold to de facto owners as demanded by the Millennium Challenge Account (MCA)? In January 2004, President George W. Bush announced the establishment of MCA (i.e., an affiliate of the World Bank) and linked the development assistance with economic reforms; meaning privatization or no money from the World Bank.
World Bank: it generates income for profiteers by loaning their money to poor countries; coerces poor countries to undertake gigantic projects, thereby, necessitating the need for loans; predicates rosy economic forecasts in encouraging wasteful spending; insists that purchases be made in countries of profiteers; creates conditions for at least 50% of the loans to be used on non-related projects; and discourages poor countries from producing food. (Economic Forum, 6/23/05).
Interestingly, the World Bank continues to praise President Sirleaf's reform, even though Liberians cry out against rampant corruption. Within the 2009/2010 edition of the World Bank, President Sirleaf's reform is rated the “Global Best” reformer. However, the “Global Best” reformer has yet to refute the story that U.S. $6.3 million dollar bid was rejected and U.S. $2.2 million dollar was accepted for the same contract. So far President Sirleaf has filed a lawsuit against the Liberian journalist for accusing her of receiving bribes. Prior to rumors of President Sirleaf’s bribery story, a company digging gold across Liberia, partially owned by President Sirleaf's brother, Carney Johnson, was accused of paying bribes to Legislators in exchange of sweet heart deals.
During the regime of Charles Taylor, Liberians at home and abroad did plan to reform Liberia's obsolete economic policy. However, the idea of reform began to fade when the World Bank proposed its kind of reform: privatization, limited government’s role, excessive salary allowances for economic advisors and lawmakers, and governmental monitoring agencies and non-governmental institutions as means of curbing corruption. After almost three years the U.S. $15,000.00 per month salary allowances has not discourage any advisors from accepting bribes. Neither has the monitoring governmental agencies (Public Procurement and Concession Commission, Anti-Corruption Commission, etc) and non-governmental agencies such as the Extractive Industries Transparency prevented profiteers from offering bribes to government bureaucrats. And Liberians are outraged of exploitation.
In order to soothe the fear of corporate exploitation, profiteers have introduced a new propaganda, corporate social responsibility. This theory suggests that profiteers will not only emit taxes to the national coffer, but will invest within a local community. Okay, some investors have made contributions, but for how long? Is it real that profiteers will fulfill voluntary responsibility even though they usually use bribes to evade their legal or involuntary responsibility? For example, Mittal Steel, which donated vehicles to Liberian Legislators and allocated funds for three counties, is noted worldwide for violating environmental laws. The U.S Environmental Protection Agency cited Mittal in 2006 for an alleged clean-air violation in Indiana. Also, in Ohio, where Mittal Steel took over Ohio Steel Plant, it admitted that its plant spewed 3.2 million pounds of pollution over the city of Cleveland, Ohio, USA. Worse, forty-one Mittal employees died in Kazakhstan in September 2006 due to poor labor policy, according to Financial Times. (www.Indiatogether.org).
By the way why is it that the World Bank is focusing on privatizing economic activities including utility entities? In the World Bank's view, such an economic arrangement allows profiteers to extract huge profits from countries without having to use the system of slavery or rely on dictatorial regimes. Yes, private-owners, using the monetary system, and not the political structure, will generate higher profits than the profits generated by using dictators. How? Higher profit is possible because investors will freely transact businesses without the burden of societal concern. For instance, profiteers can make profits by marketing ownership's rights, lending money at higher interest rate, gouging prices, laying off thousands of employees or investing cash reserves into risky portfolios.
This scenario above is what profiteers use to make excessive profits on Wall Street, which was partly responsible for the 2008 financial crisis. (NY Times, 10/5/09). For example, Simmons, a mattress-manufacturing corporation located in Minnesota, changed ownership at five different times. The first seller got $32 million, second seller got $265 million, seller third received $513 million, and fourth seller made $1.1 billion, and fifth received $760 million. But the company ended up with a total debt of $1.3 billion dollars, before it filed for bankruptcy. Also, The Tribune Co, which publishes The Los Angeles Times, The Chicago Tribune, The Baltimore Sun, etc and Television stations paid huge bonuses, but gave pink slips to thousands of employees, and filed for bankruptcy.
Many emerging countries such as Indonesia in 1989, Mexico in 1995, Iceland in 2008, Poland in 2008, etc did experience profiteers' shenanigans on Wall Street. In the case of Liberia, private-owners, already operating gold, diamond and iron ore mines, are demanding the privatization of utility entities. And if the World Bank and President Sirleaf are successful, de facto owners, freed from government's interference, will manage the utility entities such as the National Port Authority, Liberian Electricity Corporation, Liberia Water and Sewer Corporation, etc.
Will Liberia generate enough revenue with such an economic arrangement? If the reasons for Liberia's fourteen-year old civil war do not provide a clear answer, U.S. Secretary of State did warn Liberians during her visit to Liberia on the theory of shifting natural resources to profiteers. Secretary Hilary Clinton, from the leading capitalist country (America), said that the government should have a role in managing her natural resources similar to Botswana’s involvement in managing its natural resources. I surmise that Sec. Clinton is aware of how U.S. profiteers pay minimal taxes. So if the U.S. Treasury Department, with the kind of technical manpower and available resources, could only collect $16 billion dollars in taxes, and not the $245 billion dollars (i.e., $700 billion dollars multiplied by 35% effective tax rate), how will a banana Republic such as Liberia become effective in encouraging profit-getters to pay reasonable taxes and provide services at affordable prices? Finding answers to these questions is not easy. However, waiting for the next president in 2011 to search for solutions to these problems will even be more difficult.