• Lower taxes will leave Kenyans with more disposable income, enabling them to invest and re-invest in civilian production, thus employing more people.
• Reduction and removal of taxes — not BBI — is what will lead to sustainable peace because when people have the liberty and the ability to meet their fundamental human needs, conflict becomes the furthest thing from their minds.
He knows ‘tis madness, yet he must adore,
And still the more he knows it, loves the more.
This phrase is part of a poem by Publius Ovid in his collection in the tenth book of Metamorphoses.
In this poem, Ovid describes Pygmalion as a young sculptor living in ancient Greece. Pygmalion became disgusted by the loose and shameful lives of the women of his era. He vowed never to marry and consequently lived alone. He devoted all his energies to his craft.
One day, he decided to sculpt his ideal woman out of ivory. When he finished, he stepped back to admire it. It was exquisite; flawlessly beautiful and an object of passionate desire. The more he admired it, the more he fell in love with it and the more he wished the statue was alive. He named her Galatea.
Over the past year, the nation has had its own rendition of Pygmalion. Our sculptors have been personified by President Uhuru Kenyatta and ODM leader Raila Odinga through the equally famous and infamous handshake.
The handshake principals and their foot soldiers have tirelessly told the nation that it was the disgusting post-election lawlessness and conflict that made the two close ranks, set aside their personal political differences and attempt to unite the nation.
Through the handshake, they vowed to never again be the cause of election bloodshed. Subsequently, they sculpted their ideal version of peace and named her Building Bridges Initiative. And they loved her. And with each passing day, they know ‘tis madness, yet they must adore, and still the more they know it, they love it more.'
In so many words, and in various dialects, and through all manner of hitherto inconceivable political alignments, the sculptors and supporters of BBI, similar to Pygmalion’s Galatea, have told us that BBI is ideal, the absolute and utopian panacea for the post-election peace that has persistently eluded the country. To buttress the point, examples have been given of the peaceful campaigns in the Kibra by-election, where supporters of various candidates largely campaigned in relative peace. The President underscored this fact in his recent ‘appease the mountain’ retreat last week.
This begs the question, what is peace? Is it the absence of war or conflict? And how is it achieved?
Uhuru and Raila are not wrong on the handshake being the panacea of post-election peace, but they are also not right. Allow me to explain.
In economic-speak, the handshake is known as the peace dividend. Peace dividend describes a state in which a country is no longer at war. Hence, the state reduces spending on defence and reallocates those resources elsewhere.
The resources recouped from defence spending are used for the good of society and sustainable development. The nation’s economic benefits are converted from military to civilian production. This is called the guns and butter theory. Let me illustrate this through an imaginary graph.
Imagine an XY graph. The x is the horizontal axis and the y is the vertical axis. On the x-axis is the number of guns and on the y-axis is pounds of butter. Now, also imagine you have a limited amount of money to produce either guns or butter. Undoubtedly, the more guns you produce, the less butter will be produced, and vice versa.
Let us now circle back to Uhuru and Raila. The two are not wrong because the handshake reduced security spending on ‘teargas Mondays’. However, they are not right because they diverted those resources into sculpting a Sh10 billion BBI, rather than spending them on civilian production.
Had they consulted yours truly, I would have advised that for lasting peace, their energies should have been concentrated around civilian production. One very practical way to do this is to reduce or waive taxes across the board, ranging from income tax, excise duty, stamp duty to value-added tax.
Lower taxes will leave Kenyans with more disposable income, enabling them to invest and re-invest in civilian production, thus employing more people. With the extra income, they would have more spending power enabling them to consume goods and services. This increases aggregate demand that in turn increases production, and sequentially requires more labour. This leads to higher productivity, thus a low unemployment rate.
By default, the Big Four agenda will be realised through the reduction and removal of taxes. This is because there will be a proliferation of cottage industries that will focus on manufacturing and agriculture. From the revenue generated, Kenyans will be able to afford housing and pay for their own health services.
This, and not BBI, is what will lead to sustainable peace because when people have the liberty and the ability to meet their fundamental human needs with relative ease, conflict becomes the furthest thing from their minds.
Irrefutably, reducing or waiving taxes will hurt us all in the short run, some more than others, particularly those whose livelihoods and luxury lifestyles depend on taxes. And the latter will be the first and most ardent to debunk this proposal. This is because it is impossible to make a man understand something when his salary depends on his not understanding it.
Like a pregnant woman, they tell you being in labour will hurt. But nobody can ever prepare you for how badly it will hurt. But once the baby is born and you cradle it on your breast, all the pain is forgotten. Likewise, the collective benefits of reduction or removal of taxes far outweigh the pain it will cause us — the cost of BBI and the acrimony it has birthed.
For starters, to manage the pain induced by the reduction and removal of taxes, I propose the President spends more time in Ichaweri rather than accumulating frequent flier miles; his deputy in Sugoi, rather than burn carbon with his fuel-guzzling entourage in search of spiritual fulfilment; his Cabinet Secretaries and their employees can forego flowers, newspapers and mandazis; the governors and MCAs can benchmark change agents in their villages rather than abroad and the MPs should suspend CDF expenditure.
This is the practical guns and butter theory, where reducing government expenditure will divert those resources into discretionary income in Wanjiku’s pocket.
Finally, my unsolicited advice to Uhuru: Your lovely daughter reminded us that it is more important for us to learn how to fish rather than receiving the fish. She was not wrong, but she was also not right. Please do not teach us how to fish. Because when we become experts at fishing, the pond owner will erect a sign saying ‘no fishing here’.
Instead, reduce or remove all taxes. This will allow us to own the pond. And when we become pond owners, we can freely and peacefully fish naked at midnight. And never again will you wonder why we are broke, because we won’t be; nor will you have to sculpt a BBI in search of peace, because we will already have it.
One day you are the statue; the next day you are the pigeon – Diane Sawyer