Where Tanimu Yakubu missed it

Tanimu Yakubu’s argument is intellectually elegant but fiscally evasive. His central error is that he defends deficits in theory, while avoiding the real issue: whether Nigeria’s present deficits are productive, sustainable, transparent and development-enhancing.

Yes, deficits can be legitimate. But no serious economist says deficits are automatically good merely because “government spending becomes somebody’s income.” That is a half-truth. Government spending becomes income only in an accounting sense. Economically, the decisive question is whether that spending expands production, exports, jobs, infrastructure, tax capacity and future growth — or whether it merely finances consumption, recurrent obligations, political patronage, debt service and inflation.

That is where his thesis fails.

1. He uses Keynesian economics selectively

Keynesian deficit spending is counter-cyclical, temporary and targeted. It is not a licence for permanent borrowing in a structurally weak economy. Keynesian intervention assumes that the state has the capacity to spend efficiently and withdraw stimulus when stability returns. Nigeria’s problem is that borrowing has become a routine fiscal habit, not a disciplined stabilization tool.

The IMF’s 2025 Article IV data shows Nigeria’s consolidated government deficit projected at 4.7% of GDP in 2025 and 4.9% in 2026, with public gross debt above 50% of GDP under its broader measure. It also shows FGN interest payments consuming roughly 47.3% of FGN revenue in 2025 and 49.2% in 2026. That is not a harmless accounting identity; it is a fiscal warning sign.

2. His debt-to-GDP comparison is misleading

Yakubu’s comparison with the United States, Japan, Singapore, France and the United Kingdom is analytically weak. Those economies borrow in deep capital markets, possess stronger institutions, higher revenue-to-GDP ratios, larger export capacity, and in the case of the United States, the world’s reserve currency.

Nigeria does not enjoy those privileges. Nigeria’s vulnerability is not only the size of debt stock; it is the weakness of revenue, foreign exchange earnings, productivity and institutional execution. A low debt-to-GDP ratio can still be dangerous where debt service absorbs a large share of revenue.

The 2026 budget itself projects ₦58.18 trillion expenditure, ₦23.85 trillion deficit, and ₦15.52 trillion for debt servicing. That means debt service alone is almost half of projected revenue of ₦34.33 trillion.

3. He ignores the Fiscal Responsibility problem

Nigeria’s 2026 deficit is projected at 4.28% of GDP, above the traditional 3% fiscal responsibility benchmark, unless justified by exceptional circumstances and properly explained. The Fiscal Responsibility Act provides that aggregate expenditure should not exceed revenue plus a deficit of more than 3% of estimated GDP, or such sustainable percentage as may be determined by the National Assembly.

Yakubu cannot speak as the DG Budget Office and treat this as a mere ideological debate. His office has a statutory responsibility to defend fiscal discipline, not merely rationalise fiscal expansion.

4. “Government spending becomes private income” is not enough

His claim that government expenditure becomes private sector income is only the beginning of analysis, not the conclusion. If government spending goes to politically connected contractors, inflated projects, recurrent overheads, debt servicing, subsidies disguised as interventions, or poorly monitored capital projects, the multiplier is weak.

Worse still, in an import-dependent economy, fiscal injections can leak into foreign exchange demand, inflation and currency pressure. Nigeria’s problem is not simply lack of spending. It is weak production.

The World Bank acknowledged Nigeria’s reform gains but still warned that inflation remains a major challenge and that tight monetary and disciplined fiscal policy must continue.

5. He romanticises hardship as reform

Yakubu subtly presents hardship as the unavoidable price of reform. That is politically convenient but morally incomplete. Reform may cause pain, but responsible reform must cushion the poor, sequence policies properly, protect purchasing power, and deliver visible productivity gains.

The World Bank itself emphasised that compensating transfers are essential to shield households from the initial impact of subsidy reforms. Therefore, citizens questioning hunger, inflation, transport costs and declining living standards are not economically illiterate. They are asking whether reform is being competently managed.

6. The “inherited problem” argument is overused

It is true that Nigeria’s fiscal crisis predates May 2023. Fuel subsidy distortions, weak revenue, oil dependence and exchange-rate misalignment are longstanding problems. But inheritance is not immunity. A government elected to correct a crisis cannot indefinitely blame the past while expanding borrowing and asking citizens to suspend judgment.

The proper question is not whether Tinubu inherited problems. He did. The question is whether current fiscal choices are reducing or compounding the structural risk.

7.He converts economic criticism into political disloyalty

Perhaps the most revealing innuendo in Yakubu’s piece is the attempt to portray critics as ignorant, partisan or hypocritical. That is not economic argument; it is political intimidation dressed as scholarship.

In a democracy, citizens are entitled to ask:

Is the borrowing productive?
Are projects transparently costed?
Are revenues realistic?
Are deficits lawful and sustainable?
Is debt service crowding out development?
Are reforms reducing poverty or deepening it?

Those are not opposition talking points. They are the minimum questions of responsible public finance.

Strong concluding position

Tanimu Yakubu is right that deficits are not inherently immoral. But he is wrong to imply that Nigeria’s present fiscal trajectory is justified simply because deficits exist in economic theory.

The real test is not whether the government can borrow. The real test is whether borrowing is producing a measurable transformation.

A deficit that builds power, roads, ports, rail, schools, hospitals, industries and exports may be developmental. A deficit that funds debt service, recurrent expenditure, inflated contracts, weak institutions and consumption is merely deferred taxation on future generations.

Nigeria does not need lectures on Keynes. Nigeria needs fiscal credibility, transparent borrowing, disciplined expenditure, productive investment, stronger revenue, reduced waste, and measurable results.

That is where Tanimu Yakubu missed it.