Social and Economic Problems in the 1970s
Under Tolbert, Liberia continued to move along a road to development that relied on private enterprise. The open door that had been offered by Tubman to foreign investors was maintained, but pressure was put on foreign?owned companies to be more responsive to the needs of the country. In 1976 the Firestone Plantations Company concluded a new agreement with the government that made it subject to the full range of tax laws. New concessions negotiated with other companies contained similar provisions. Tolbert also insisted on a bigger role for Liberians in the foreign?owned companies, as well as in such areas as commerce and transportation but, because economic development had far outpaced domestic reserves of trained manpower, it proved difficult to take meaningful steps in that direction.
A new and optimistic four?year development plan went into effect in 1976, but the world recession took a heavy toll on Liberia. As foreign markets abroad and prices for Liberian commodity exports declined, the cost of imported energy rose steeply. Liberia was barely able to maintain a positive growth rate in the late 1970s, when a drop in the output of iron ore was offset by rising ore prices. By the end of the 1970s Liberia's foreign debt stood at $744 million and the budget deficit at more than $100 million, the latter largely the result of extravagant public works projects.
The dramatic expansion of the Liberian economy after World War II had provided the means for improving hitherto neglected social services and had greatly enhanced the employment opportunities for a large segment of the population. But it had also created social problems, particularly those associated with the movement of people into the towns, with which the country's government was not prepared to deal. Despite impressive economic development?some analysts contended because of it?Liberia did not feed itself, although it was not lacking in the physical resources to do so.
It had been a long?standing government policy to subsidize cash crops=rubber, cocoa, and coffee?that were produced for export typically by Americo?Liberian planters. By contrast, rice, which was mostly grown on small, low?income farms tended by tribal Africans for domestic consumption, was for the most part unsubsidized and sold to dealers at prevailing market prices. In the marketplace, however, rice prices were heavily subsidized to keep food affordable for the urban population. Prices were fixed in this manner for home?grown and imported rice alike. Companies imported large quantities of rice for sale at reduced prices to employees. This practice and low producer prices depressed farm profits to the extent that there was little incentive for smallholders, who made up the bulk of the rural population, to grow more rice than was needed for their own subsistence. Some farmers switched to cash crops. Production was also affected because many men went to work for wages on the plantations or in the mines. Others left the countryside for the towns in hope of finding jobs there.
The latter were frequently disappointed in their search, and Monrovia became home to large numbers of unemployed. A vagrancy law had been enacted in 1963 in conjunction with Operation Production, under which unemployed adult males in the towns were liable to be sent back to the countryside where, it was supposed, they could be productively occupied in raising rice. Another and perhaps more serious motivation for the law, however, had been to break up the growing detribalized underclass of "back street boys" who inhabited squalid quarters of Monrovia, where they contributed to the city's high crime rate and were a potential source of social unrest. As a result of the influx from the countryside, the capital had burgeoned from a sleepy seaside town of 12,000 in 1940 to a crowded, chaotic city of more than 166,000 in 1974 where housing was inadequate, sanitation was poor, and public facilities were ill maintained.
Even the privileged class of students, whose political consciousness had been raised along with their expectations by having access to education, saw their opportunities dwindling in the 1970s. There was a local saying that every occupation was part of a monopoly: the Lebanese monopolized shopkeeping, the Guineans cab driving, the whites management and technical positions, and so on. The only monopoly left to the Liberians, it was said, was the one on poverty. It went without mentioning that the True Whig Party had a monopoly on government jobs.
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