Buhari, we need to talk

President Buhari need to understand that if barking orders at markets did not work in the 1983-1985 era, it will not work now either. In as much as he is right that devaluation will precipitate inflation, his current policy of limiting imports and creating artificial scarcity will be even more inflationary. A weaker currency would revamp domestic production and spur growth more than import bans can, and will hurt Nigerian consumers less in the long run.

“At home we face enormous challenges,” said President Muhammadu Buhari during his 2015 inaugural speech as Nigeria’s newly elected president.¹ I think he is right. When he came to power in a military coup more than 30 years ago, the country he inherited was a mess: the economy was collapsing due to falling oil prices and its treasury was looted by pilfering politicians. During that period, which spanned through 1983 to 1985, Nigeria’s export earnings fell by more than 50 percent. The Nigerian economy went into deep recession and, while he was trying to restore public accountability and re-establish a dynamic economy, he was overthrown in a coup.²

Last year, Muhamadu Buhari won a fair election to become Nigerian president again. The problems he has inherited are, to a very large extent, identical to what he had more than 30 years ago:  oil prices have slumped, from $64 a barrel in February 2015 when Buhari’s government came to power to about $32 today. The country’s growth rate fell from 6.3 percent to about 3 percent, a value that is almost half the rate of 2014 and is also barely enough to keep pace with Nigeria’s population. The country’s stock market is also down by almost 50 percent of its peak in the year 2014. It should be noted here that as much as 70 percent of Nigerian government’s revenue comes from oil. Not only that, oil accounts for 95 percent of the country’s export earnings. Given that the country’s economy swoons along with oil price, the government deficit will widen this year to about 3.5 percent of GDP if oil price continues to fall. The country’s currency, the naira, is under pressure: as of last week, the dollar sells for 300 naira or more in the black market, even though the central bank insisted on an exchange rate of 179-199 naira to the dollar.³

When it comes to the naira, the appropriate policy would have been to allow it to depreciate to reflect the country’s loss of purchasing power. Doing this will boost domestic demand since exports will become cheaper and more competitive to foreign buyers – a factor that can create jobs in the export sector. In addition, allowing the naira to depreciate will help to increase export volumes and aggregate demand which will, in turn, improve the country’s current account deficits and its economic growth rate.⁴ Buhari’s government, however, have a different plan: The central bank is trying to keep the naira aloft by restricting the supply of dollars and by banning the import of a long list of goods, from toothpicks to shovels and rice. Their logic for this approach is that banning certain imports will help the government to maintain its foreign reserves as well as stimulate domestic production.⁵

Ideally, when a country devalues its currency, all imports becomes expensive. But under Buhari’s systems, imports are restricted by government fiat, which makes it artificial. So far, the restrictions on imports makes it very difficult for factory bosses to import key raw materials such as chemicals. This means that some of these factories may be forced to shut down if this trend continues. Many of them has no other choice but to turn to the black market to obtain dollars.⁶ And it will not be an exaggeration to say that they might also be smuggling in some of the goods that have been banned by the Buhari’s government.

As every economist will tell you, history is usually a good place to look for answers. Buhari’s current economic model is not new to Nigerians. As a matter of fact, Buhari did something similar around 1983-1985 - the last time he was president. At that time, he rejected the option of devaluation and the result was catastrophic: the country’s supply of foreign currency depleted significantly and Buhari responded by rationing it and by slashing imports by more than half, just like he is doing now. This pushed Nigerian businesses to turn to the black market for foreign exchange. Buhari’s response this time was more draconian: he sealed the country’s borders. With limited access to foreign exchange, Nigerian businesses could not imports vital raw materials, which decreased their volume of trade and forced many to lay off their staff. With the country facing a surging unemployment at the time, Buhari expelled 700,000 migrants.⁷

President Buhari need to understand that if barking orders at markets did not work in the 1983-1985 era, it will not work now either. In as much as he is right that devaluation will precipitate inflation (as it has in other countries that make their money by digging stuff from the ground), his current policy of limiting imports and creating artificial scarcity will be even more inflationary. A weaker currency would revamp domestic production and stimulate growth more than import bans can, and will hurt Nigerian consumers less in the long run. What is certain is that Nigeria needs foreign capital to finance its deficit. From a realistic perspective, the country will struggle to get any under Buhari government’s current policies. Foreign investors, who are already nervous over Nigeria’s economy and political situation, assume that any of the country’s assets they buy in naira now will cost less later after the currency has devalued. Since investing in any Nigerian asset now will expose them to foreign exchange risks and potential loss of value, a lot of them are pulling out from naira-denominated assets, which include stocks and bonds.

What Buhari must do now

Many of the things Mr. Buhari has done so far are in some ways very impressive. In the northern Nigeria, which was overrun by Boko Haram jihadists, he has restored a semblance of security. He is winning the battle against corruption, which had flourished under the previous president, Goodluck Jonathan – an ineffective buffoon who allowed Nigerian politicians and their friends to dip their fingers into public funds with impunity. Some of his economic policies are laudable too. For instance, he is trying to use a mildly expansionary budget to stimulate the economy. His proposal to remove the fuel subsidy and sell petroleum products at market prices is equally commendable.⁸ With fair justification, his move in that regard is indeed a brave one, given that fuel subsidies are popular in Nigeria, even though they have produced nothing but disaster: the cheap fuel are often smuggled out of the country and sold at the neighboring countries while Nigeria’s petrol stations frequently stay dry.

My argument here is simple: Buhari should continue with his bold stance and implement more sound economic policies, since at this time, Nigeria’s economic success cannot co-exist with political weakness. In line with this he should apply the same boldness that made him to let petroleum products cost what the market says it should to the management of the naira, the Nigerian currency. Simply put, he should allow the naira to gradually depreciate so as to improve Nigeria’s export competitiveness and trade deficit. He should also reduce the size of the government.  Nigeria is a country where the government has a strangle hold on the key sectors of the economy, especially on the energy, railway and the seaports – a situation that leads to corruption, gross inefficiency and loss of significant revenue from these sectors. President Buhari may be unlucky in the sense that he became the president at the time when Nigeria is going through a near-death experience with respect to its economy. However, Nigerians can forgive him for being unlucky if he can implement policies that can create jobs and give the country’s economy the shock it needed to spark a period of urgently needed economic growth and development.

References

¹President Buhari’s Inaugural Speech . (2015, May 29). Vanguard.  Retrieved March 1, 2016 from http://www.vanguardngr.com/2015/05/read-president-buhari-inaugural-speech/.

²1983 Coup. (2016). Global Security. Retrieved March 1, 2016 from http://www.globalsecurity.org/military/world/war/nigeria2.htm.

³Nigeria's Economy: Hope the Naira Falls. (2016, January 30). The Economist, p. 10.

⁴Pettinger T. (2013). Advantages and Disadvantages of Devaluation. Economics Help. Retrieved March 1, 2016 from http://www.economicshelp.org/blog/1299/economics/advantages-and-disadvantages-of-devaluation/

⁵Nigeria's Economy: Hope the Naira Falls, op. cit., p.10

⁶Ibid

⁷Associated Press(1985, May 5). Expelled Foreigners Pouring Out of Nigeria. New York Times, pp. Retrieved March 1, 2016 from http://www.nytimes.com/1985/05/05/world/expelled-foreigners-pouring-out-of-nigeria-by-the-associated-press.html.

⁸Nigeria's Economy: Hope the Naira Falls, op. cit., p.10

Teaching in America: Things I discovered when I became a college professor

To the general public, professors enjoys working condition that is cozy and civilized, with a lot less stress than most jobs in America. But, as a foreigner teaching in  America, I discovered that the reality can be as romantic as a marriage of convenience: unless they have tenure or are teaching full time, America’s college professors have the job security of zero-hour contract workers, the social life of hermit,s and the job stress of brain surgeons.

It is fashionable to romanticize college professors. The U.S. media celebrate the academic  geniuses who use their ideas, research and knowledge to change the world. Politicians praise them as  knowledge creators. To the general public, professors enjoys working condition that is cozy and civilized, with a lot less stress than most jobs in America. But, as a foreigner teaching in  America, I discovered that the reality can be as romantic as a marriage of convenience: unless they have tenure or are teaching full time, America’s college professors have the job security of zero-hour contract workers, the social life of hermits and the job stress of brain surgeons. And those professors who teach only part-time at American colleges (usually called the adjunct professors) have money worries of chronic gamblers. I still remember those years when I was an adjunct professor (I was an adjunct professor for five years before I started teaching full time).  During those years, I had to teach at least 7 classes at three(sometimes, even four) different universities just to put food on my table and meet my other financial needs and obligations. My car was basically my office in those years. My typical day goes this way: I will teach Algebra in the morning on one campus and Statistics in the afternoon in another campus. Then in the evening I will drive down in a rush to the third university to teach an MBA class. By the time I get home and complete my grading  late in the night, I’m already burned out even though I had to repeat the same ritual the next day.  Those of us who are lucky enough to eventually get full time teaching appointments  are also  overworked and leisure starved but we  still love the job,  simply because we see teaching as a vocation, and we do get enormous personal fulfillment in transmitting knowledge to the next generation.

What do I exactly know about teaching in America?

When I came to America some years ago I knew that I will face challenges working as a college professor,  simply because  it is a new environment and a new culture. I did my undergraduate work at Nnamdi Azikiwe University Awka, in Nigeria, and my master’s  and doctorate at University of Phoenix (Arizona) and Walden University respectively, both of which are in America. It was during my graduate school days that I learned the challenges of teaching in American universities and colleges. Much of the American university system, especially in terms of expectations for both faculty and students and the basic classroom norms, are naturally unfamiliar to me at the start of my teaching career in America. This added more challenges to an already imposing task.

Start with the first semester. Generally speaking, my first semester as a university professor in America was ruthlessly demanding. I had to construct the course syllabus (by the way the course syllabus in America is more voluminous than what we have back home), read, write lecture plans and create teaching notes, deliver the lecture and do lots of grading, office hours and professional development workshops. At first, I was assigned to teach only math classes (mainly Algebra and Statistics). However, it wasn’t too long before I started teaching Macroeconomics, Finance and Introduction to Business classes as well.

One of the biggest challenges I faced came from the students themselves. Without putting it in so many words, American students were not at all like those I had encountered during my undergraduate days back home. For a start, their understanding of the relationship between the student and the professor is entirely different from what we have back home. But I am happy  to say a lot of them were delightfully polite. But since I am teaching Mathematics classes, the most hated classes in the campus, I must also confess that I have equally met lots of nasty students as well.

Americans were known to have independent personalities. But when it comes to learning mathematics, majority of their students were quite dependent learners. So I won’t say that I was too surprised that their first reaction upon encountering a math question was usually to lean on me. Sincerely speaking, I have lost count of the number of times my students contacted me, in many cases very late at night, to ask questions that I have already provided the answers very clearly in the course syllabus. One student called me at 1:33 am to ask the type of calculator and textbook needed for the class. All of these are very different from what we had during my undergraduate days in Nigeria. In those days, we literally worship our professors and we certainly avoid asking questions that would make them to conclude that we weren’t up to scratch.

My solution to all these was to try to get the students to take more ownership of their learning and invest in themselves. How did I do this? First, for any given class session, I only teach half of the time. The remaining half the students will be on their own, working on the questions I gave them from the topics we covered during the session. I even let them work together while solving those questions so they can learn from each other. When they complete the questions, I check each of the students’ work, give them the participation grade for the day and let them go, while instructing them to continue to practice at home.

Another challenge I had  with the students was my accent: many of my student often tell me that my ‘British’ accent is really hard to understand. Well, I was already thirty one years before I came to America so it is really difficult (or almost impossible) for me to change my accent. Thank God I teach mainly Mathematics and Finance which doesn’t require much grammar! In any case I soon realized that, to improve my students’ learning experiences and outcomes, I needed to connect better with them so as to make them trust their strange-talking professor (me). To that end, during the first three weeks of each semester, I usually ask my students questions about their perception of my class – things like how they feel about the class now that we have completed some weeks of the semester. My most encouraging finding was that my questions proved invaluable. The responses I got from the students were basically consistent: they want me to talk more slowly and to stop putting so much into each lecture. Well, talking more slowly I can live with. But putting less topics into each lecture I cannot do since I had to go by the syllabus provided by the university. In any case , I did made some desired adjustments to my teaching methods, which in turn earned me a bit of good will that I could trade to get the students to do the things I really cared about (like maintaining a good attendance and participating actively in the class). In addition, I encouraged them to come and see me during my office hours but unfortunately most of them do not show up.

My other surprises were more vexing. The students’ mathematical skills fell far short of my expectations. Many of them had  difficulty solving arithmetic problems like percentages, fractions, decimals and basic geometry, which in turn had a major impact on their ability to understand the basic concepts of Algebra and Statistics. On the basis of my tortuous grading experiences alone, I can infer that the U.S. high school system is passing the buck on the development of basic arithmetic skills to higher education. On one of the tests I graded last semester, the student did virtually nothing: he left most of the questions blank and on the last page he wrote “I have no clue Dr Ojih – I haven’t done Math for fifteen years!”

With these too “deep-seated” shortcomings on the part of the students, I knew it would be a challenge for me to make a serious dent in their learning outcomes. In any case, I tried anyhow. For instance, in my Algebra classes, I always spend the first week of the semester  teaching such topics as the “Review of Real Numbers”,   “ Variables and Expressions”, “Like and Unlike Terms,”  and so on.  In addition to the class practice questions (which I grade right there in the classroom in the presence of the students), I usually give my first tests early in the semester so I could give students extensive and timely feedback on exactly what I expect from them. The class practice questions which the students solve in the class while working together in groups had one major benefit: it reduces test anxiety and made the students feel more comfortable about what was expected of them in the final grades. This is important because American students cares about grades a lot. And I mean a lot, for real. In one particular semester (I think it was the Fall of 2012, I can’t remember anymore) I tried one strategy that I thought would help identify knowledge gaps as well as serve as a wake up call for slackers in my class: In the first four weeks of that semester, I  gave two tests on the lecture material, cumulatively worth only 10 percent. The students, most of who had an allergy to tests, found it all overwhelming. Some of them who got, say, 4 out of 10 on the test were very anxious and worried. Many of them went on and complained to the Chair of my Department that I was wearing them down with tests. One of the students, who got 3 out of 10, told me in a tearful voice (she actually implored me) that if she didn’t get an A  in this class she wouldn’t get into the Nursing program at the college. I explained to  her that these tests  carried limited weight and showed her exactly where she was falling short, so that she can prepare for subsequent tests, homework and the final exam. But alas! All my explanations made no difference to her.

The above explanations reflected a fundamental difference in our experiences of education back home. Going to a university in Nigeria (I attended Nnamdi Azikiwe University Awka, Nigeria) and spending what was, when compared to America, a very small  amount of money in tuition, books and boarding each year, I saw going to college as an extraordinary opportunity. I knew this student was spending well over $12,000 a year in tuition, books and other school expenses, but in her eyes the equation is quite different: to her, money buys opportunity. She felt that after committing such a huge amount in tuition and books, she had already contributed the input. So now, she expected the output. In as much as this kind of mindset is distorted to me, I do see where she was coming from. In any case, I did scrap the early tests in subsequent semesters. I now give only two tests in a semester. The rest of the course assignments include homework, class practice and final exam.

The way American students developed their world views was the final major difference from my experiences teaching in America. Growing up in Nigeria, we did not rationally believe that Nigeria was the center of the world, but rather that it is a country located inside the continent called Africa. In other words, it is composed one small, quirky part of the world. In contrast, my students in America tended to see things in a relentlessly American-centric fashion. Simply put, their knowledge of ideas, places, events and people outside the United State is surprisingly limited. Six years ago, one of my students asked me this question: “Professor, Nelson Mandela is the President of Africa, right?” As you can see, it is only a slight exaggeration to say that I naturally felt that if I don’t make my American students to confront the preconceptions about how the world worked, then who in their lives would? The good part, though, was that I found that they loved being pushed to think in entirely new ways and engage with new horizons – a good quality that made me think more about the rigidities of my own mindset, too.

Stooping to conquer

Looking back, I knew I would never have gotten through it all without help from my professional colleagues, which include other professors and faculty members. They were very unstinting in sharing syllabus and helpful tips during faculty meetings, workshops and seminars. Many of the Deans and department chairs in some campuses put up with my lateness in submitting final grades and other documents during the grading seasons. On the positive side, I made significant improvements every semester. Like edits in an essay, my revised lectures, especially in my Statistics classes, were always more concise and focused. And in my Finance classes, my updated PowerPoints were always better at showing the key calculations  instead of just telling them. In my Algebra classes, I began relying less on notes and walking around the class more.

For me, the most encouraging thing is that I love my job. The benefits of teaching for my research were unmistakable: it provided me the chance to learn and investigate issues and topics that I finds interesting. Not only that, teaching provided a never-ending flow of new ideas – a factor that pushed me to think in new direction about my dormant book project. The fact that there is relatively no structure on the topics that I can research or learn about forced me to read broadly, which in turn provided me wonderful ways to impact lives and make a difference in the world one student at a time, particularly as it relates to helping students understand difficult concepts and problems.  

The food supplement industry: the hype continues.

While consumers spends billions of dollars every year on vitamins and food supplements in hopes of improving their health and fitness, many of these products lack scientific evidence to back up their purported health claims. Consumers can just cut out the supplement industry by eating decently and exercising regularly.

This is obviously a glorious time for the supplement industry, with more than half of U.S. adults popping vitamins, minerals, herbs  and elixirs. According to the available published evidence, retail sales of vitamins and nutritional supplements reached $28.1 billion  in 2010.¹ And between 2009 and 2014, worldwide value of retail sales of these products reached $88 billion.² This is a good news for both the small and the large producers. Take Otsuka Pharmaceuticals of Japan. The company is the owner of Pharmvite,  which churns out 15 billion pills per year. Other pharma giants from America and Germany, including Pfizer and Bayer, are also big peddlers of multivitamins.³

On the minus side, however, the industry seems besieged. First, there are concerns about the accuracy of the claims they make. The U.S. Department of Justice has accused Bayer Corporation for illegally promoting the effects of its probiotic, a supplement that it claimed helps to defend against symptoms like bloating, diarrhea and constipation.⁴ The company’s management is currently waiting for the  court ruling on the issue. Last month, America’s Federal Trade Commission held a workshop to evaluate advertising for over-the-counter homeopathic products.⁵ Yet, a lot of people as well as government agencies still worry the safety of these products. America’s Food and Drug Administration(FDA) mailed warning letters to firms selling pure caffeine  last  September. Their reason was that these firms sells pure caffeine products   that are highly concentrated, with one teaspoon of their products containing much of the stuff as, say, 28 cups of coffee. A large number of supplement makers sells products that were  illegally branded as food “supplements” even though they contain BMPEA – a stimulant similar to amphetamine. The supplement makers in this group have also received several warning letters from  FDA last April. In addition to the constant warnings, surveillance and sanctions they  receive from the regulators, the supplement industry are also in the radar of the law firms: numerous lawsuits are in the works, on everything from protein powders said to lack protein to allegedly dangerous diet pills.6

In spite of these attacks, the food supplements industry seems to has a good immune system of its own. Basically, the unique environment in which the industry operate – an environment characterized by lax regulation, potent marketing and millions of credulous consumers keen to pin their hopes of a healthier life on a pill – has catapulted it to prominence, making it a national sensation. Hence it is not an exaggeration to say here that the food supplement industry has proven time and again that it is very  resilient.

The United States, with its loyal consumers and uniquely helpful regulations, seems to be the industry’s honeypot. Though growth has slowed, the value of retail sales of vitamins and nutritional supplements in United States reached a record $32.8 billion last year.7 The Nutrition Business Journal is considered to be an authority when it comes to providing information about the industry – information  relating to the trends, operation tactics, products and consumer concerns. As was reported in the publication, dietary supplement sales in United States grew 7.5 percent to $34.8 billion in 2013(as noted in New Hope 360).⁸

The “vitamin” club

Catherine Price, an assistant professor at the University of Florida said it all in her book Vitamania – Our Obsessive Quest for Nutritional Perfection: America’s craze for food supplements started in the 1930s and 1940s.⁹ At that time, scientists validated the claim that vitamins are chemicals that can perform vital functions in the body. Hence pills containing vitamins are widely seen as magic pills that can boost soldiers and work alike. Soon scientist perfected the methods for synthesizing vitamins in factories rather than being extracted from nature. This important feat made vitamins to be cheaper and widely used. Following this medical trajectory, Linus Pauling, who was awarded a Nobel Prize in Chemistry in 1954,¹⁰ popularized the invalid claim that  vitamin C could prevent colds and cure cancer. Nevertheless, it was government regulations that gave the supplement industry the biggest boost. The FDA considered new rules for supplements’ health claims in the 1990s. With this development, the major players in the industry understood there were billions of dollars at stake. Their lobbyists sensationalized the issue thereby making access to food supplement an issue of personal liberty. Their major achievement in that regard was phenomenal: if bureaucrats regulates access to vitamins, it would mean that they are robbing Americans the freedom to care for themselves.¹¹

See no evil, hear no evil, speak no evil

The outcome of their activities was clear: a new law was passed to cover not only vitamins and minerals, but also botanicals, pills made from animal organs, amino acids, enzymes and metabolites. A 1994 law also made life more easier for the supplement industry: it allowed them to sell supplements without requiring FDA’s approval for efficacy or safety. The rule also authorized producers of food supplements to tout their health benefits. According to the provisions of the rule, these firms cannot claim that the pills they market to the public can diagnose, prevent, treat or cure a disease. They can, however, make vague claims that their supplements are essential for strong bones or that they can support a healthy heart, and so on. Hence, instead of restraining these supplement industry, the government, via the FDA, actually unleashed them. It is thus not surprising that since 1994 the growth of supplement products has reached exponential proportion.¹²

The logical deductions from these rules are that they fail to ensure safety and efficacy. Starting with safety, the rules on manufacturing standards apply only to the supplement-makers only. In other words, they do not apply their suppliers. In addition to this, the rules did not place any cap on the amount of nutrient that a pill may contain. Furthermore, the FDA’s powers over supplement products that are already on sale are limited. Thus, the agency cannot just ban a supplement product as they can do with other drugs. They must first of all prove that the product is unsafe before they can withdraw it from the shelves. Examined against this background, it was no surprise that it took seven years for the FDA to provide evidence that certain pills caused liver disease – an outcome that led to the outright banning of the pills. The saving grace for some food supplement –makers is that, given the FDA’s limited role, they can hire consultants to check their products’ quality. While many of the supplements-makers do this, others do not.

Studies have found problems with lots of food supplements. Earlier this year, New York’s Attorney-General Eric Schneiderman alleged that many food supplements did not contain what they claimed on their labels.¹³ While some industry groups and consumers argued that Schneiderman’s testing method were faulty, other studies have also found problems with food supplements: a test conducted on 42 multivitamins by ConsumerLab.com, a provider of independent tests results and information on health and nutrition products, revealed that 16 of them either have too little or too much of the nutrients claimed in the label.¹⁴

Other cases dealing with the safety or purported benefits of food supplements are more serious. In October 2014, an infant from Connecticut died from a contaminated probiotic.¹⁵ In 2013, the FDA received almost 30 complaints of averse incidents associated with  a vitamin B pill(Health Life Chemistry by Purity B-50), which was later found to contain steroids. The people  who took this pill reported many bad things happening to their body: the women reported facial hair growth and missed menstruation while men reported low testosterone and impotence. Lab results also found that using the product can impact cholesterol level as well as cause abnormal liver and thyroid function.¹⁶ During the same year, the U.S. Center for Disease Control (CDC) linked Oxy-Elite Pro, a dietary supplement, to acute hepatitis. Of the nearly 50 people that were hospitalized after using the product, at least 3 received a liver transplant while person died.¹⁷

The efficacy of these products is also questionable. What made dietary supplements more dangerous is that while firms must have some substantiation  for the claims they make on the labels and ads under the Dietary Supplements Health and Education Act (DSHEA) of 1994, they are not required to submit safety information about their products to FDA  before marketing them.¹⁸ This simple fact makes it difficult for the FDA  to monitor and regulate thousands of products being marketed by these firms. So it may not be surprising that the FDA had had to rely on adverse event reports, information in the scientific literature, product sampling and other sources of evidence of danger to combat public confusion about food supplements. This further means that the consumers are virtually unprotected against unsafe food supplements.

This, however, does not mean that all food supplements are bad. A few of them does have sound scientific evidence behind them. For instance, vitamin B12  is good for the elderly and folic acid is good for women planning to become pregnant. Low levels of vitamin D is linked to cognitive decline, even though evidence that the supplement can solve the problem is lacking.¹⁹ The supplement industry’s relentless central argument is that since many Americans eat unhealthily, supplements therefore fill a need. The problem with this argument is that it is difficult to discern many supplements’ benefits. For instance, in a drug trial the individuals in the control groups takes no medicine. In contrast, in in a study of a vitamin, the people in the control group still ingest various levels of that vitamin from food, making it a big challenge to judge the effects of the supplement. Not only that, the evidence that does exist about the benefits of food supplements is often mixed. Some botanicals, such as gingko (a supplement for improving cognitive function and for treating, preventing  or reducing the effects of Alzheimer’s disease) show no effect in large studies. Another popular herbal supplement known as John’s wort is ineffective because it can interfere with blood thinners.  In one surprising study, researchers conducted a test to determine if a precursor to vitamin A can cut the risk of cancer among smokers. Their results showed that the supplement seemed to increase it.²⁰ Another study with disturbing results was conducted in 2011. According to this study results men who take vitamin E have a higher risk of getting prostate cancer than those on a placebo. Two similar studies were also conducted around the same period which showed positive results:  one showed that multivitamins  may lower the risk of cancer in men while the other suggests they may lower heart-disease deaths in women. These outcomes were contradicted by researchers in three  studies in 2013.These researchers presented  data that showed that multivitamins supplements  showed no effect on cancer, heart disease, cognitive decline or death.²¹

Armed and proud

The industry experienced some signs of weakness in 2014, the year in which it grew more slowly than at any time since 2002.²² But the major players in the industry are not giving up irrespective of the negative attention and criticisms of the industry and its products. They have three reasons for adopting this mindset.

First, further regulation of the industry in America appear unlikely. Ideally there are bills to improve oversight. However, such bills never got anywhere at the Congress. The FDA doesn’t seem to have any plan about using its existing powers to police the industry. The Council for Responsible Nutrition(CRN), a trade association representing dietary supplements and functional food manufacturers,²³ has $6 million budget to boost the interests of its members. In contrast, the FDA has only $5.2 million to police the entire supplement industry. Besides,  its strongest boss to date, who had since returned to lobbying business, was a former lobbyist for the food supplement industry.²⁴  So, you do the math: more regulation is simply impossible given the agency’s resources. The FDA’s failure to issue warnings about the stimulant BMPEA on time illustrates the agency’s limits. The FDA knew that a range of popular diet pills and spots supplements contained BMPEA since 2013. But the agency did not issue warnings to the manufacturers of these products until last April. The FDA’s failure to take regulatory action on time, as appropriate, to protect consumers may have been due to conflicts of interests. It may also be that the agency has too many tasks with no cash to accomplish them at the time. Even the agency cannot confirm that products with BMPEA  are off the shelves  for nearly five months after sending its warning letters.²⁵

Second, the food supplement industry are expert in bouncing back. So, while a negative publicity can hurt sales, they usually bounce back up: the industry has indeed consistently shown notable prowess for getting back to their feet. For instance, a study on the risks of excessive amounts of vitamin D in a body – known as vitamin D toxicity – helped depress sales growth in the supplement industry from 16.7 percent in 2011 to 1.3 percent in 2012. But in 2013, sales growth in the industry rebounded to 9 percent.²⁶ Generally speaking, if one particular product does not make a comeback, the industry simply offer a new one – a strategy that has huge resonance with the consumers.

Third, Americans and the Western Europe in general love taking supplements. As a matter of fact, almost 50 percent of Americans take supplements regularly. The general belief that supplements are the holy grail of general health fuels their passion and craving for the product. Thus it is not surprising that Americans take them for their bones, their hearts and their minds, among other reasons. Added to the hype is the fact that supplement industry are also good marketers, who regularly craft targeted messages that will reach correct consumers. Not only that, conventional health care is expensive. So consumers sees supplements as an alternative, cost-effective solutions to the costly conventional health care since supplements lets them take charge of their health. Next is another important factor is what is generally known among scientists as the placebo effect: the customers’ brains responds positively to their belief that a given pill will help improve their body functions.²⁷

All these mean that the greatest threat to the industry may not be the regulators or the results of clinical trials. Their main threat is actually something that is very simple: consumers are earnestly searching for natural and organic foods. They are also willing to pay more for them. Thus in 2014, sales revenue from natural and organic foods grew by 12.7 percent compared to supplements’ rise of 5.1 percent.²⁸ But, as was expected, the supplement industry are already adapting. Last year, GNC launched a new line of whole-food-based supplements.²⁹ That same year Pharmvite acquired FoodState, a whole food supplement company which makes vitamins from fresh and local foods.³⁰

A final point: consumers can just cut out the supplement industry by eating decently and exercising regularly. But I do know that the supplement industry will not like this idea. And nobody will really blame them: they have good reason to hope that the consumers will not be that smart.

References

¹Retail Sales of Vitamins & Nutritional Supplements in the United States from 2000 to 2017 (in billion U.S. dollars). (2015). Statista. Retrieved October 19, 2015 from http://www.statista.com/statistics/235801/retail-sales-of-vitamins-and-nutritional-supplements-in-the-us/.

²Vitamins and Supplements - Miracle Healers. (2015, September 19). The Economist. Retrieved October 19, 2015 from http://www.economist.com/news/business/21665064-despite-scandals-and-scepticism-americas-supplement-industry-looks-healthy-miracle-healers.

³Ibid

⁴Long, J. (2015, June 12). Bayer Braces for Trial in Probiotic Supplement Dispute with FTC. Natural Products Insider. Retrieved October 19, 2015 from http://www.naturalproductsinsider.com/blogs/supplement-law/2015/06/bayer-braces-for-trial-in-probiotic-supplement-di.aspx.

⁵Federal Trade Commission. (2015). Homeopathic Medicine & Advertising. Press Release. Washington DC: Federal Trade Comission. Retrieved October 19, 2015 from https://www.ftc.gov/news-events/events-calendar/2015/09/homeopathic-medicine-advertising

⁶Vitamins and Supplements - Miracle Healers, op. cit., p. 57

⁷Retail Sales of Vitamins & Nutritional Supplements in the United States From 2000 to 2017 (in billion U.S. dollars). (N.D.). Statista. Retrieved October 26, 2015 from http://www.statista.com/statistics/235801/retail-sales-of-vitamins-and-nutritional-supplements-in-the-us/.

⁸The state of supplement sales in 2014. (2015). New Hope 360. Retrieved October 26, 2015 from http://newhope360.com/supplements/state-supplement-sales-2014.

⁹Price C.(2015): Vitamania – Our Obsessive Quest for Nutritional Perfection. New York, NY: Penguin Press.

¹⁰Linus Pauling - Biographical. (2015). Nobel Media.  Retrieved October 27, 2015 from http://www.nobelprize.org/nobel_prizes/chemistry/laureates/1954/pauling-bio.html

¹¹Vitamins and Supplements - Miracle Healers, op. cit., p. 58

¹²Ibid

¹³Esch, M. (2015, April 2). 14 Attorneys General Seek Congressional Probe of Herbal Supplement Industry After New York Investigation. NBC New York. Retrieved November 9, 2015 from http://www.nbcnewyork.com/news/local/Herbal-Supplement-Warning-Congressional-Probe-New-York-Ingredients-Schneiderman-Consumer-Health-298522901.html.

¹⁴Vitamins and Supplements - Miracle Healers, op. cit., p. 58

¹⁵Kroll, D. (2014, December 17). Infant Death Triggers FDA Health Provider Warning On Probiotic Risks. Forbes. Retrieved November 9, 2015 from http://www.forbes.com/sites/davidkroll/2014/12/17/infant-death-triggers-fda-health-provider-warning-on-probiotic-risks/.

¹⁶Jaslow R.(2013): FDA: Anabolic Steroids Found in Vitamin B Supplement. CBS News. Retrieved November 9, 2015 from http://www.cbsnews.com/news/fda-anabolic-steroids-found-in-vitamin-b-supplement/

¹⁷FDA Investigation Summary: Acute Hepatitis Illnesses Linked to Certain OxyElite Pro Products. (2013). U.S. Food and Drug Administration. Retrieved November 9, 2015 from http://www.fda.gov/food/recallsoutbreaksemergencies/outbreaks/ucm370849.htm.

¹⁸U.S. Congress (1994). Dietary Supplement Health And Education Act of 1994. Retrieved November 9, 2015 from http://health.gov/dietsupp/ch1.htm.

¹⁹Vitamins and Supplements - Miracle Healers, op. cit., p. 58

²⁰Tanvetyanon T., Beplar G.(2008). Beta-Carotines in Multivitamines and the Possible Risk of Lung Cancer Among Smokers versus Former Smokers. Cancer, 113(1), 150-157.

²¹Vitamins and Supplements - Miracle Healers, op. cit., p. 58

²²Ibid

²³About CRN. (n.d.). Council for Responsible Nutrition. Retrieved November 18, 2015 from http://www.crnusa.org/who_about.html.

²⁴Vitamins and Supplements - Miracle Healers, op. cit., p. 60

²⁵Ibid

²⁶Ibid

²⁷Ibid

²⁸Ibid

²⁹Get Fit, Feel Great With GNC PUREDGE™ Line of Whole-Food-Based Supplements . (2014). PR Newswire. Retrieved November 23, 2015 from http://www.prnewswire.com/news-releases/get-fit-feel-great-with-gnc-puredge-line-of-whole-food-based-supplements-300000553.html.

³⁰Vitamins and Supplements - Miracle Healers, op. cit., p. 60

Remittances: From Europe with love

For decades, the flow of immigrants’ money around the world was largely unnoticed feature of the global economy. Not anymore: as more people than ever cross borders to live and work abroad, the size of these remittances has increased significantly.

 

For the immigrant in Europe and America, the road to success does not run smooth. Yet, despite all their struggles to survive and the meagre income they earn, these immigrants manages to send a little pocket money back to families in their home countries. For decades, the flow of immigrants’ money around the world was largely unnoticed feature of the global economy. Not anymore: as more people than ever cross borders to live and work abroad, the size of these remittances has increased significantly.

 According to the available published evidence, more than 250 million people lives outside their countries of birth. Not only that, over 750 million people migrate within their countries.¹ If the past ten years teaches us anything, it’s that demographic forces, globalization, and climate change will increase migration pressures in the coming decades. This trend will even increase the level of remittances more. Broadly speaking, economic migration has become so widespread that global remittances is now more  than two times larger than total global aid budget (see table 1).

Table 1: Capital Flows to the Developing World (2014)

Type	Amount($ Billion)
Remittances by Immigrants	440
Foreign Direct Investment	733
Portfolio Flows	410
Foreign Aid	175

Source: World Bank²; The Economist³

 

Not only that, many countries depend on migrant remittances. In India, Philippines and Tajikistan, for instance, migrant remittances are one of the driving forces behind their economies: they are worth 36 percent of India’s GDP, 10 percent of Philippines GDP and 42 percent of Tajikistan’s GDP.

The power of money

The obvious effect of migrant remittances is to make a place richer. Take Vennicode, a backwater village in Kerala, India. It has new houses and brand new private school built with money sent home by people working in Dubai, Oman and other countries. It also has huge advertisements for businesses like jewelry shops and has much more traffic than its narrow roads can handle.⁴

It should be noted here that even before mass migration began in the 1970s, Kerala was already one of the wealthy states in India. In fact, when compared to the national average, Kerala is now about 50 percent wealthier per head.⁵ Its migrant population are well-educated and disproportionately Muslim. Also, its families have done best. But they do have some poor families whose members have mostly stayed put. Because of this, Kerala is now also one of the most unequal states in India.⁶

The biggest beneficiaries of remittances last year are India and China, with each country receiving $60 billion. This was followed by Philippines ($24 billion), Mexico ($24 billion), and Nigeria ($21 billion). Egypt is the sixth largest beneficiary. As a matter of fact, the value of remittances in Egypt have surged from less than $9 billion in 2008 to almost $18 billion last year.⁷

But there is one problem with migrant remittances. Though there is nothing they can do about it at the moment, the migrants don’t really like those companies scrambling to capture as much as they can from these multi-billion dollar flows. The reason is obvious: in many cases the transfer fees can eat up more than 20 percent of the money the migrants send home.

Yet remittances are very useful to those family members that receive them. Generally speaking, when money flows from abroad, the family members who receive them naturally stop working back-breaking jobs. This shift is very beneficial, especially for children. For instance, the Philippine peso collapsed during the Asian financial crises of 1997-1998. Philippine migrants responded by increasing the value of remittances they sent home to their relatives and families. The affected families pulled their children out of jobs and sent them back to school. According to Western Union, a money transfer firm, nearly 30 percent of the money that flows through its system is spent on education – tuition, books, and so on.⁸

In some countries, especially those with small economies, remittances can account for significant proportions of their national income. The value of remittances received by families in Tajikistan and Liberia, for instance, is equivalent to 47 percent and 31 percent of their GDPs respectively.⁹ Also in many developing countries, especially those in Africa, South America and some parts of Asia, the money migrants sent home is worth more than the aid they receive. Good examples are Mexico, Guatemala, Bangladesh and Senegal, where migrant remittances are larger than foreign investment and aid  combined.¹⁰

According to World Bank’s estimates, migrants in the UK sent nearly $4 billion in remittances to India in 2011. When we compare this to the $450 million in UK aid India received that year, we will be correct to infer that it was indeed a terrific boost to that country’s economy in 2011. Bangladesh immigrants who live in UK also sent a total of $750 million home to relatives and family members in 2011. This is equally a significantly large amount when compared to the $370 million of foreign aid it received that year.¹¹

The reason for the rise in size of migrant remittances is simple: people, especially the migrants, feel an obligation to help their families and relatives back home. It is hard to see an immigrant who do not feel a sense of obligation or a sense of connection with the people, especially the relatives at the home country.

Even though there was a dip in 2008/2009 due to the recession, the remittance phenomenon has been largely recession proof. The biggest complaints from the migrants is not about the amount of money they sent home regularly. Rather, it is about the cuts taken by the banks and transfer firms. In 2009, the G8 countries made a pledge to lower the global cost of sending money to an average of 5 percent by 2014.¹² That was last year, and the average fees is still about 9 percent, which means that it cost $9 for every $100 sent. And in some places or banks, the remittance fees can be as high as 20 percent.

The word on the street

It is worth bearing in mind that the rising interest in remittances and the impact they could have in reducing global poverty does not mean that we should ignore the challenges migrants faces in foreign countries, especially those related to abuse and exploitation. Also, the psychological toll on children is another concern: when parents work thousands of miles away from home, it would seem as if their children are growing up as virtual orphans. For example, some villages in places like Philippines are almost devoid of parents. In such villages, the grandparents are literally left to shoulder the burden of childcare.¹³

Meanwhile in January 2013, Saudi Arabia executed Rizana Nafeek, a Sri Lankan domestic worker, for an alleged killing of a baby in her care.¹⁴ Her execution by the Saudi government despite numerous clemency pleas by the Sri Lankan authorities and other groups highlighted the often brutal conditions faced by migrant workers there.

Foreign workers began migrating to Saudi Arabia soon after oil was discovered in the kingdom in the late 1930s. Today, the kingdom has one of the largest migrant population in the world. So naturally, money transfer from migrants who live inside the kingdom to their families back home is huge: at $28 billion in 2011, it was the third largest amount across the globe that year.¹⁵

One thing is for certain: at this time of global economic and financial distress, attention to the plights as well as the rights of migrants is very important. As the list of rich countries forced into austerity by the markets continue to grow, we are seeing more discrimination against migrant workers, proposed immigration laws that allows the police to profile migrants with impunity, and xenophobic rhetoric that encourages violence against undocumented migrants.

Although an international convention on migrant workers’ rights does exist, only a few countries have ratified it. And those that did are mainly the developing countries where majority of the migrant workers come from. The EU and the Gulf countries has not signed it, nor have the United States.

 

References

¹Merrell   J. Tuck-Primdahl, I. C. (2014). Migration and Remittances. Retrieved September 28, 2015 from http://web.worldbank.org/WBSITE/EXTERNAL/NEWS/0,,contentMDK:20648762~pagePK:64257043~piPK:437376~theSitePK:4607,00.html

²World Bank (2015): Migration and Development Brief. Retrieved September 28, 2015 from http://siteresources.worldbank.org/INTPROSPECTS/Resources/334934-1288990760745/MigrationandDevelopmentBrief24.pdf

³Remittances: Like Manna From Heaven. (2015, September 5). The Economics. Retrieved September 28, 2015 from http://www.economist.com/news/finance-and-economics/21663264-how-torrent-money-workers-abroad-reshapes-economy-manna.

⁴Ibid p. 73

⁵Ibid

⁶Ibid

⁷Claire P. (2015): Migrants’ Billions Put Aid in the Shade. The Guardian. Retrieved October 1, 2015 from http://www.theguardian.com/global-development/2013/jan/30/migrants-billions-overshadow-aid

⁸Remittances: Like Manna From Heaven, op. cit., p. 74

⁹Claire P. (2015): Migrants’ Billions Put Aid in the Shade, op. cit., para. 10

¹⁰Ibid

¹¹Ibid

¹²Anderson M. (2014): Global Remittance Industry Choking Billions Out of Developing World. The Guardian. Retrieved October 5, 2015 from http://www.theguardian.com/global-development/2014/aug/18/global-remittance-industry-choking-billions-developing-world

¹³Claire P. (2015): Migrants’ Billions Put Aid in the Shade, op. cit., para. 18

¹⁴Sri Lankan maid Rizana Nafeek beheaded in Saudi Arabia. (2013, January 9). BBC.  Retrieved October 7, 2013 from http://www.bbc.com/news/world-asia-20959228.

¹⁵Claire P. (2015): Migrants’ Billions Put Aid in the Shade, op. cit., para. 20