Heads, you lose. Tails, you still lose.

The illusion of choice without accountability

Watching the reactions to the Taiwo Oyedele-led tax reforms has been interesting. If I’m being honest, the debates are not worthy of sustained attention. It’s a typical Nigerian reform story.

Reforms are for people who can imagine a better future. Reforms are for people who can execute in the middle of complexity. Reforms cause mutually assured discomfort. Reform is consensus built on mutual trust.

Nigeria is incapable of successful reforms because these important preconditions do not exist.

The average Nigerian leader is cynical. Most of them can’t imagine a better Nigeria, and when they can, they don’t trust themselves to execute. The first point needs no explanation if you’ve ever observed a Nigerian politician’s legacy. By legacy, I mean the things they celebrate and name after themselves. I have no doubt that the worst monstrosities you’ve seen were created by Nigerian politicians.

What’s even worse than this is a deficit of trust. The country has a complex history, and the major tribes believe there is no optimal point where the collective interest will also advance their individual interests. We’ve seen countries embroiled in damaging conflicts reach consensus and strike partnerships that improve shared interests. Nigeria is yet to arrive at this point. So, whither reforms?

What always surprises me during these reform debates is when people act as though it’s possible to get one over on the government.

They say things like “A tax increase will make people poorer while the government maintains its lavish spending. We will not stand for this.” This logic is applied to everything requiring direct buy-in from citizens, such as energy or education subsidies.

Yet the truth is Nigerians stand for nothing. To borrow from President Jonathan’s goat-and-yam analogy, Nigerians lock the gates to their barns while forgetting they’ve handed the goats the master key.

What they fail to realize is that you cannot hold the government accountable if you cannot check its excesses. If you reject a tax increase or subsidy removal, the government can still choose to spend more by borrowing or printing money to finance the deficit. If you cannot control the government’s accumulation of debt or excessive money printing, then you’ve already lost the battle.

When the debt becomes unsustainable, the tax bill that was rejected in the past will still have to be paid in the future. Citizens foolishly believe they can protest their way out of this, as we’ve seen in Kenya. They reject tax increases, demanding that the government tighten its belt. What they don’t realize is that the same government will cut funding for education, health, and other public services. Or, as in Ghana, the government will default on its debt, destroying savings and pensions. These outcomes rarely trigger protests, at least not with the same intensity as the rejection of tax increases.

It’s all an illusion.

An increase in petrol prices or taxes directly hurts people’s budgets today, but the inflation and poor growth resulting from the government’s fiscal recklessness are costs to be paid in the future.

Nigerians trade lower direct costs today for much more damaging costs in the future. And when this happens, they still fail to understand why.

Heads, you lose. Tails, you still lose.