It is a measure of Master Sgt. Samuel K. Doe's continuing popularity that street crowds applauded spontaneously as he passed by recently in a custom-built Mercedes Benz limousine immediately after announcing a 20 percent price increase in rice -- their daily staple.
A little more than two years ago, a similar governmental proposal unleashed violent "rice riots" by street crowds. Twelve turbulent months later, the president, William Tolbert, was ousted in one of contemporary Africa's bloodiest military coups and replaced by Doe as head of state.
Last month, under pressure from the International Monetary Fund and U.S. State Department, Doe lifted the years-old subsidy of rice prices, pushing the price from $20 up to $24 per 100-pound bag, and substantially raised taxes in an effort to halt Liberia's slow economic deterioration and reduce the government's large annual cash deficit.
Yet significantly for this small West African country's future, the official corruption and extravagance that Doe and the other coup-makers had promised to eradicate have crept back into the same prominent roles they held under the Tolbert government.
Elsewhere in Africa, the fiscal management records of the many military governments over two decades of independence have varied widely from the fiscally conservative, almost corruption-free military government of Niger to the venality of Ghana's former military leadership. There is some hope for sound financial policies under Doe's government, economic analysts said, but there are also some disturbing warning signs.
In his July 17 speech announcing the end to the $9 million yearly government rice subsidy, Doe also outlined additional emergency measures that will add from 2 to 10 percent to personal income tax bills for Liberia's salaried work force of 71,000, boosted the gasoline tax by 20 cents to $3 a gallon and launched a modest $615 million four-year development plan.
"The fact must not be hidden that our economic and financial condition remains grave," said Doe in his 40-minute speech. "As your leaders, we, the members of the People's Redemption Council have had to make some difficult choices among unpleasant and difficult alternatives."
But the Redemption Council is beginning to be the focus of growing domestic disgruntlement, most of which is still publicly muted, due to the reappearance among Army officers and some high-level civilians of blatant bribe-taking, high living, ethnic favoritism that could be a harbinger of tribal conflicts and the shifting of a heavier than necessary tax load onto Liberia's taxpayers to ensure the comfort of the new government leaders. Identical complaints were given as justifications for the overthrow of Tolbert's government.
While much of Liberia's present financial difficulties were inherited from the Tolbert government, the country's previous high credit rating -- attributable to a 13-decade history of political stability -- was wiped out with the coup.
Diplomatic and financial analysts here believe that Doe has yet to bring under firm control the other soldiers on the ruling Redemption Council. Five council members were executed last week after being accused of plotting against Doe. In addition, soldiers, and some imposters, have continued to extort and harass local businessmen since the early days of the coup.
Chase Manhattan Bank's outgoing branch manager here, Ian Hodge, recently raised some of these issues in two farewell speeches. Hodge represented Chase here for five years and, although his talks were covered by local reporters, none of his criticism of the Redemption Council or Doe appeared in the government-run media.
"It is somewhat disturbing to note the apparent increase in the harassment of various business leaders by Redemption Council members," Hodge said at one point.
"The coup not only resulted in a new government, but also toppled the dominant so-called Americo-Liberians descendants of the 19th century American blacks who founded the country as the privileged and monied class within Liberia," Hodge said. "A direct result has been an increase in tribal importance which has resulted in tribal friction, as the Krahn tribe of Sgt. Doe has obtained a massive amount of government largesse despite its relatively small size." Sixteen tribes make up Liberia's 1.8 million population.
One government official, who declined to be identified, acknowledged that "corruption has returned and is going on on a wider scale" than previously. "The difference is that the total dollar amounts are smaller and it reaches down all the way to the small man in the street, whereas, it only benefited the top-level officials" in Tolbert's government, he added. "We're calling it a redistribution of the wealth."
Since the mid-1970s, Liberia has been suffering from a drop in world prices for two of its major exports, iron ore and rubber. The Tolbert government borrowed heavily overseas and saddled the country, which has an average annual budget of $250 million, with a $700 million debt.
With support from the IMF, Doe's government has been able to reschedule a large amount of the debt repayment. The IMF insisted, however, that austerity measures be taken to reduce the government's $100 million deficit of last year to less than $75 million this year before it would grant Liberia $65 million in special drawing rights. The U.S. Embassy here notified Doe's government that unless it fulfilled IMF requirements the second half of a $25 million economic support grant would not be released.
By ending the rice subsidy, raising income taxes and the tax on gasoline, Doe met most of the IMF demands.
The rice subsidy alone, besides draining meager government resources, fueled massive smuggling of the cheaper Liberian rice across its borders into Sierra Leone, Guinea and the Ivory Coast.
In his speech, Doe said he has also ordered an extensive reform of customs duty collection at Monrovia's port, which was described by a banking official as "the most corrupt operation in Liberia."
Major problems remain. Individual members of the Redemption Council, for example, have allotted up to 12 cars for their personal use from government fleets. Anyone traveling on government business can claim $400 a day in expenses even if another government or international agency is paying the tab. In its first eight months in power last year, Doe's government had spent more than double the $600,000 a year that Tolbert's government budgeted for travel expenses.
The recently failed Bank of Liberia was closed in March, but soldiers, implementing liquidation procedures, are collecting the debts in cash without receipts, according to particularly well-informed financial sources. The government's central bank, which already has to make good on a $21 million overdraft from the Bank of Liberia, "will probably also have to repay the depositors their $10 million," said one source. "This is money Liberia doesn't have."
For more than a year, the IMF has been trying without success to get Doe and the Redemption Council to agree to sell the 737 Boeing presidential jet they inherited from the Tolbert government.
The annual debt payment on the plane "is $2.2 million and if they sold it today, this government would realize a profit of $7 million," said a foreign financial source. "But they prefer to have the plane available for their personal use," he added.
To keep the plane and still meet IMF demands on reducing government expenditures, the 5 percent austerity income tax that IMF representatives recommended be applied across the board was implemented on a graduated basis with the higher paid of Liberia's workers taxed as much as 10 percent more.
Patrick Seyon, vice president of the University of Liberia who has studied the country's economy, sadly shook his head when asked for a reaction to the income tax increases the day after they were announced.
"People are saying that the taxes fall too heavily on the wage earners and not on the market women or the Lebanese merchants here," Seyon said. "They joke that they might as well quit their jobs and go into small-time trading in order to survive."