For the moment let us put aside the debate as to whether President Ellen Johnson Sirleaf’s economic policy, including the double benefits (i.e., tax abatement for and payment in arrears in rent to her supporters) or the payment of $15,000.00 or $25,000.00 per month to few advisors has benefited the general public. Instead, let us review the policy within the Governance and Economic Management Assistance Programme (GEMAP), which will shift a larger share of the profits of government’s properties away from workers and government’s coffer to contractors. In addition to putting foreign experts in charge of all financial matters of Liberia, the Agreement (GEMAP), signed before the 2005 general elections, stipulates that all State-Owned resources, starting with National Port Authority (NPA), Maritime Bureau Agency (MBA), Forestry Development Agency (FDA), etc will be privatized through contracts.

If the privatization provision in GEMAP were implemented, would the policy not accumulate more wealth in the hands of private capitalists who already own significant interest in every industry such as diamond, housing, etc in the country? Further will it not create an environment conducive for few Liberians to be rich like Carlos Slim Helu of Mexico, Roman Abramovich of Russia, or Azim Preji of India who became $49 billion dollar richer, $18.7 billion dollar richer, $17.1 billion dollar richer respectively who bought governments’ properties on the cheap? (Landon Thomas, Jr., NY Times, 12/14/07).

So do the so-called capitalists have the same level of interest in manufacturing industries as compared to the level of interest in entities that require minimal funding such as NPA, FDA, MAB, LPRC, RIA, etc? Or, are we to assume that profiteers’ wealth earned from government's properties would trickle down even though no wealth has trickled down to society from housing, transportation, education, banking, diamond, mining, logging, import/export since 1847?

Many Liberians are frustrated with government’s inefficiency, for example, the payment of $236,000.00 to board of directors of NPA during 2007. (Frontpage Africa, Web Site). However, ordinary people are unaware of the facts that big business itself uses corruption to make huge profits, and have accepted the idea that privatization is good. For instance, there was no public outcry when President Charles Taylor sold government’s properties to his friends. In addition, the World Bank, which also owns companies that bid for governments’ contracts, promoted the idea of privatization. It continues to preach that the sale or contracting of government’ properties creates wealth and reduces corruption. (Economic Forum, 2005) Also, many conservative economists such as Adam Smith have said that the proper role of government was to steer clear of managing any properties and allow profiteers to create wealth, which will trickle down to every level of society.

Do privatizers or contractors make profit the old fashion way? Critics say no. Critics indicate that selling or contracting out government’s properties usually allows privatizers to earn profits from low wages, etc, and not from hard work or new initiatives. Privatizers or contractors, critics assert, generate profits by paying minimal taxes, charging astronomical fees for good and services, etc. For example, two writers, Andrei Shleifer and Lawrence Summers, former Economic Secretary of President William Jefferson Clinton and former President of the University of Harvard, explained in a 1988 landmark paper (Hostile Takeovers as Breaches of Trust) that new owners get higher profits from old companies by reneging on social contracts such as labor contracts. They argued that the new owners would not earn huge profits if they have to reimburse older employees who had been overworked with an understanding that their deferred compensation would be paid in the future. In short, the motive of huge profits promotes corruption.

Besides paying lower wages, avoiding taxes, violating environmental laws, critics state that profiteers also extort profits by using kickbacks to keep away competitors. Additionally, they usually use unambiguous or complex laws and accounting rules to reduce government’s share of the profits. For instance, the investigative report on the United Nation-Iraq’s program “Oil for Food” by Paul Volker, suggested that profiteers emit little profits to the government by creating legal entity, although without economic substance, for paying fictitious or inflicted payments such as patent fees, royalty fees, consultancy fees.

Is the assertion true that contractors or investors’ wealth would trickle down? If the theory is true, why did profiteers persuade President Sirleaf to abate taxes and also to pay arrears in rent at a time when teachers had not received their ten-month back pay or poor workers were downsized? Well yes if they do, then they give with the hope that the donations would smooth the rough edges of their cutthroat business reputations.

Does privatization or the management of government’s properties reduce corruption as proponents of market reform claim? The answer is no. But if yes, how would business prosper and be efficient without using bribery or kickbacks to oil its wheels? Critics say that when profiteers preach about transparency, accountability, and the rule of law, their concerns are centered more on the protection of their privileges. Therefore, any compassionate national arbiter (i.e., a people’s government) should prevent any reduction in the already dismal income of the poor by not buying into the belief that profiteers would help to minimize corruption since they (profiteers) usually rely on kickbacks to become profitable?

So it is a good idea to enhance the operations of government’s properties, be it through privatizers, contractors or employees of the government. However, efficiency alone without a reasonable share of the profits emitted to the government to fund social programs will not protect a democratically elected government from insurrection or civil war. The Democratic Republic of Congo is an example. It is once again plunged into civil war even though it ousted dictator, Mobotu Sese Sekou and had free and fair elections in 2006. Professor Peter Rosenblum, a consultant to the US-based Carter Center, said Congo has limited resources to finance programs because government's properties "… had been given away, or sold off, or at least as far as people knew, it seems to have just flitted away." (Corp Watch, BBC News, 6/12/07).

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