Why The Nigerian Middle Class Is The Problem – And The Solution

Yes, consumerism is higher today, but its not an excuse for the depreciated state of infrastructure and social goods in Nigeria

proClass-consciousness is the enemy of the financial and political elites that constantly inseminate the idea that “all of us must work together and sacrifice” for the greater good, when in fact the “greater good” is largely favorable to the elites. While perspectives may vary on the exact sociological standards of the middle class, it pays to note that what happens to these dynamics is very important to the sustainability of a healthy democracy and in this case Nigeria’s democracy. The ability of these group of people with a decent measure of “income” and comfort to participant in politics and economic activities is vital for democracy. It is assumed that a strong middle-class (a) acts as a voice speaking out for the (powerless) the poor (b) can hold the government accountable and will most likely fight for justice and (c) supports inclusive political and economic institutions, which underpin economic growth and development. Welfare performance indicators of this social group in Nigeria forces the question, is our middle class growing? or do we have a consuming middle class or a statistical median income group?

In 2007, the World-Bank classified Nigeria as a low income country, recently in 2011 according to the Migration and Remittance Fact book, Nigeria is now a middle income country. Per –contra, comparing the income level of this social group to their expenditures and measuring it against the globally accepted standard of living shows that the current scholarly work on the raising Nigerian middle class is largely flawed. Analysing the General Household survey (1996), the Nigerian Living Standard Survey (2004), correlating that to the 2004,2009/2010  Harmonized Nigerian Living Standard Survey shows that the term “middle class” is a relatively context specific concept whose meaning is derived from an economic circumstance over a period of time. Along these lines, the trends in welfare metrics shows that the current middle class group in Nigeria are relatively worse off. Although, there are statistically more people rising out of absolute poverty and are evident of more people having increase in spending power, economically they are living a lie, because the macroeconomic primitives and other factors of consumerism are not contributory to their existence and sustenance.

According to the Keynesian model, individual consumption has a cardinal role in reducing unemployment and inducing growth.  Solimona (2008) suggested that of all the social strata that makeup private consumption, middle class was the most important. Solimona further hinted that the primary focus of an economic policy seeking to reduce poverty be focused on the welfare of this dynamic.  Many more studies such as Easterly 2001, Pressman 2010, Khara 2010, Chun, Hasan and Ulubasoglu 2011, and Martinez and Parent 2012 all  laid emphasis on the importance of the middle class as having a stabilizing impact; a requirement for a stronger and more sustainable economic growth thus development. 

W.Cashell, 2007; Kharas  and  Gertz, 2010 argued that, components of what makes a middle class is arguably one of the most  controversial areas of social research. Study such as done by NBS (2007)Robertson, Ndebele, & Mhango, (2011) and the AfDB (2011) have all attempted to study emerging middle class countries including Nigeria. As a result, they prompted the emergence of the new sets of middle class however; such studies failed to take a stand on whether or not these emerging middle class were a consuming or statistically group. Looking at Nigeria’s socio-economic development in the last three decades of military government in comparism to the attendant nose-dived economic non inclusive growth since the return of democratic government shows that significant factors have clearly affected this social group even though their income distribution pattern have increased. For example three decades ago, electricity more highly distributive and more stable, the Nigeria railway system transported food from northern Nigeria to their distributive points, today food such as tomatoes coming from the north often get rotten on the way and sometimes involved accident due to bad roads by which all the goods may perish. Joshua Gimba argues people are consuming far more today than they did thirty years ago i.e. the average poor person in Nigeria today has a mobile phone and some own or aspire to own high-tech phones such a blackberry. Yes, consumerism is higher today, but its not an excuse for the depreciated state of infrastructure and social goods in Nigeria, it just means that social goods and service will require constant improvement and more maintenance.

Despite the success of the telecommunication and banking sector, this oil-dependent economy still suffers from various economic stresses; stress which is potentially diminishing the rising middle class.  The decline of the Agric and manufacturing sector as well as the inputs of corruption, income inequality, lack of social goods and infrastructure remains detrimental. The collective effects of the above mentioned scenario makes Nigeria an import-dependent economy.  As a result, almost 80% of the country’s spending goes to foreign exchange trading, also due to unreasonably high cost of domestic production partly due to the lack of stable electricity and fuel supply has reduced the country’s industrial capacity utilization to less than 30% (USASoS 2012).  Presently, Nigeria’s hopes of achieving vision 2015, 2020 and all other points’ agenda remains a mirage (Joseph, 2009).

The country is suffering from extreme policy decapitation of the government’s inability and indifference of ensuring provision of social goods and services. Presently, private individual’s out of pocket expenditure for healthcare account for 76% of total health care expenditures in Nigeria (WorldBank, 2012). The segmented non-inclusive growth coupled with unhealthy policies and other factors have the potential to reduce the size of the middle class as well as reducing their bargaining power in socio-economic activities. Joseph (2009) stated that economic and good governance are crucial factors in driving the middle class as economic growth and developmental governance must go hand in hand to empower the growth of the middle class; as observation showed that stable higher income democracies often results in stronger middle class and a relatively low absolute poverty rate and more equal society. In contrast, countries with higher unequal income and services distribution tend to have weaker middle class who are less likely to be involved in shaping political and economic decisions. Further, unequal social strata often contributes social, ethnic conflicts and operate populist political system thus, a stronger healthy middle class is deemed as a crucial factors in stabilizing political and economic development.

Nigeria is awash with the big idea of what Chen (2012) referred to as the rumour of the Chinese arising middle class. Evidently, factors supporting such claims remain conflicting and un-established, given that the proposed indicators and the macroeconomic fundamental underlining the middle class are not looking positive currently. The argument is not there are no middle class or that more people are not being lifted out of extreme poverty but rather that considering the economic situation and the development indicators of this group, the existing middle class may not be as sub-sequential and juicy to assume the ideal role of who a middle class is globally.  In order words; most of the people referred to as middle class in Nigeria could actually be termed poor in the globally accepted barometer of who a middle class is.

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