President Ellen Johnson Sirleaf, following the directives of our creditor (World Bank), is planning to sell/lease government-owned entities to the rich. And many Liberians, apparently, for obvious reasons, are paying little attention to the issues of neither privatization nor its dire consequences as expressed by billionaire George Soros or Paul Volcker, the former chairman of the U.S. Federal Reserve Bank. Also voters have yet to link Liberia’s uncompetitiveness to the theory of limiting government’s role in training its citizens and shifting the responsibility to private institutions which usually operate on parochial interest. Or neither have they considered the idea that if profiteers did not trickle down any reasonable share of the dividends from managing our diamond, forest, iron ore, etc for since 1926, would their management of water and sewer, power and light, the port, etc benefit society?

To sell/lease a country’s assets is called privatization or market reform, an advancement of capitalism. Milton Freidman, the celebrated economist, did not only disagreed with third world leaders who complained that capitalists’ management of natural resources was not uplifting society, but also offered a new theory (privatization) to advance capitalism. He said government’s interference in economic activities was responsible for the depression. He argued that prosperity will spring and corruption will reduce if government shifted the ownership of utility entities to private-owners, reduced government’s oversight of energy, utility, natural resources, and eliminated the licensing of doctors.

Yes government is corrupt, especially so in developing countries, however, experts say profit motive has never allow private-owners of institutions to deliver rosy promises. More so, market reform, or privatization does accumulate profits, but it does not address casualties such as unemployment, homelessness, hunger, etc since there is no profit motive, said Allen Sinai, chief global economist for decision Economics, Inc. Also Paul Volcker, the former U.S. Federal Reserve chairman, of course referring to market reform, said that “… the fragile financial system has produced unimaginable wealth for some, while repeatedly risking cascading breakdown of the system as a whole.” Another critic, Peter S. Goodman in an article called “A Fresh Look at the Apostle of Free Market” said “… the idea that prosperity springs from markets left free of government interference” is not good for society. (NY Times 4/13/08).

George Soros, whose $3 billion dollar compensation made him one of the 29 hedge funds managers who took in $59 billion in 2007 (NY Times, 4/16/08), has prophesied that global capitalism might “…undermine reform-minded governments and even destroy itself.”

In his 10th book called “Crisis of Global Capitalism,” he added that global capitalism is the biggest challenge to civil society. It has invaded other fields and made human interactions to be valued in terms of “…single common denominator: money.” He is also critical of our creditor (World Bank and its affiliate I.M.F.) for favoring lenders at the expense of borrowing countries.

Are critics overreacting to the casualties of privatization or market reform? Not really. For instance in the U.S., critics believe that government's limited role in training its manpower has not only compelled corporations to hire foreign residents, but that the shortage of technicians has increased the cost of doing business. Also they believe that private investors, due to profit motive, constructed limited number of homes, one of the reasons why housing has become expensive. Others believe that profit motive is coercing doctors and other professionals to cut corners by compromising ethical principles for huge compensation. Alarmingly, even government’s subsidy has not shifted many private-owned entities from the practice of cutting corners.

Interestingly, if the World Bank does not equate subsidies awarded to private-owned industries such as farm, car, airline, insurance, or bank as government’s interference, why is government’s investment in utility services such as education, housing, or health be considered as government’s interference? Or if Liberians do not share the views of the likes of Joseph E. Stiglitz, winner of the Nobel for economics in 2001 and former economic advisor at the World Bank, who has pinpointed problems of our creditor and burden of privatization, is there any success story of the World Bank? The Bank, a promoter of privatization, has not only failed to reduce poverty, but has only helped in making poor countries to become poorer.

By the way is the failure of the World Bank to aid poor countries due largely in part to its proximity to the White House and, or its debtor/creditor relationship with Wall Street which advocates privatization? Can the Bank operate freely without interference from de facto owners such as chief executives at Wall Street who finance significant portion of the Bank's debt? So, was it due to the influence of Wall Street, for example, that Nigeria, which borrowed $5 billion from the World Bank, paid $16 billion, but still owes $32 billion?

Or is it due to the influence of the White House that the World Bank usually approves loan for dictators who sell natural resources on the cheap, but punishes countries that do question the theory of privatization? In fact the World Bank, in many cases, deals with countries that have sold and, or leased natural resources to private investors. I surmise then that if the idea of privatizing was considered as the remedy to corruption and poverty, is it clear why many of these countries have become poorer?

In the case of Liberia, none of its natural resources was managed by the government, yet the country did not have the resources to build high schools, roads, health centers across the country until the beginning of the 70s. Also, why the government did not get involved in feeding its people? The answer is privatization. There was this propaganda fueled by external forces that Liberia is better off if government left agriculture in the hands of private investors. Similarly, had decision-makers appreciated government’s involvement in education, the World Bank might have advised Liberia to use the hundreds of millions wasted on Hotel Africa to build training centers. Cognizant of the Bank’s biases against government’s role and its preference for privatization, should Liberians accept recommendations on privatization by President Sirleaf’s advisors who might have received excessive allowances from our creditor (World Bank)?

Why are Wall Street, the World Bank or the White House advocating for privatization? Does the World Bank or by extension Wall Street and the White House, want an advisor/consultant who has a divided loyalty or a debtor/manager (private-owned entities) with complete loyalty? During the colonial period, reign of military regimes, or dictatorships, the Wall Street or the White House did not have to worry over divided loyalty since it was a “so say one, so say all” system. With a slogan of democracy, and in order to continue to exploit, profiteers have designed a system where economic activities would be in the hands of private investors who will be directly or indirectly under the influence of financial institutions, while the rest of the activities would be assigned to politicians.

This arrangement will make it possible for the Liberia Electricity Corporation, if privatized, to hold back the supply of electricity to homes and businesses in order to increase the price consumers have to pay. That's not an imagination. Enron did just that in 2001 when managers held back the flow of electricity to businesses and homes in California, thereby increasing the price by 45%. In another example, Liberia Petroleum Refining Company would become bankrupt the same way Bear Stearns did. Speculators, according to Senator Christopher Dodd of Connecticut, drove Bear Stearns’ stock selling at $187.00 down to $2.00. Such transactions, experts say, would enrich the few and delay the coming of prosperity to the rest of society. Is that the kind of dividends President Sirleaf promises?

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