Two institutions: Georgetown University and Apple Inc authored this paper. Possibly, the university developed or conceived the algorithm or model, and needed data (a critical raw material for AI research) and computing resources, and Apple provided those. If you go deeper, there is a symbiotic relationship here: universities are great at developing models as they have “free” PhD students who can be paid nothing even as they drive for new frontiers, while companies have resources and want to take those models into the market as products.

So, the companies drop some funds to the universities, and most times those are tax deductible during corporate tax filing. The universities have resources to do their thing. Over time, America advances!

I am hoping that those reforming Nigeria’s tax laws will pay attention to the power of tax in university-industry partnerships, and how an efficient tax system will stimulate a university-industry partnership in Nigeria; I explain here.

Donation money given to schools is tax deductible because the schools are tax-exempt under the U.S. Internal Revenue Service tax code. This is the key reason. If Apple or GM were to do the training in-house, the tax benefits will not materialize. They will still train the young people, but they cannot deduct that money. But by giving the money to colleges, they get the trained people and still get the deductions. This makes it easier when you need scale, beyond what you can have inside as staff for talent pipeline.

Private Financing of Nigerian Public Universities via Tax Innovation

I have been consistent: I am against the removal of Nigeria’s fuel subsidy when all we needed to do was to remove the corruption in the subsidy management. Yes,  I like strategic subsidies in economies because you have to subsidize something most times despite whatever Adam Smith postulated on his “invisible hands” construct. Yes, in the last 20 years, the United States Postal Service has not made a single profit (see data below). Why? The US is fine to make sure logistics and supply chains remain optimized for industries to grow.

(Nigeria is now operating on quasi fuel subsidies since there is no more correlation between the FX and the prices at the pumps, implying that someone is covering the differences.)

How can rural and urban America work without the postal service? Not possible. So, America tells the postal service NOT to use reflective pricing on shipping, making things cheaper across the nation, and especially in the rural areas. Of course, when all is done, they recover those “losses” in taxes, which typically grow because of more engaged economic activities across both urban and rural areas.

If you live in New York, you can buy an iPhone cover for $4 from China. That $4 includes shipping and handling. How can someone make an iPhone cover in China and ship it to you in New York for $4 and still remain in business? China has subsidized logistics.

Why this post? I am responding to those who want to make Nigeria a  100% free market system with zero subsidies. Good People, Nigeria needs energy subsidies, forex subsidies, etc BUT must remove the corruption in its subsidies so that only productive things receive those supports to advance the nation.  There is nothing wrong in fuel subsidies or forex subsidies, our challenge is that we have too much corruption in them and that makes them look bad. Every country subsidizes something, and when scaled, it becomes conglomerate tax.

Postal Service Net Income/Loss By Year

• 2023 – $6.5 billion loss
• 2022 –  $473 million loss
• 2021 – $6.9  billion loss
• 2020 – $7.6 billion loss
• 2019 – $8.8 billion loss
• 2018 – $3.9 billion loss
• 2017 – $2.7 billion loss
• 2016 – $5.6 billion loss
• 2015 – $5.1 billion loss
• 2014 – $5.5 billion loss
• 2013 – $5 billion loss
• 2012 – $15.9 billion loss
• 2011 – $5.1 billion loss
• 2010 – $8.5 billion loss
• 2009 – $3.8 billion loss
• 2008 – $2.8 billion loss
• 2007 – $5.1 billion loss
• 2006 – $900 million surplus
• 2005 – $1.4 billion surplus
• 2004 – $3.1 billion surplus
• 2003 – $3.9 billion surplus
• 2002 – $676 million loss
• 2001 – $1.7 billion loss

As the world praised the removal of fuel subsidies in June 2023, on the illusion that it would rekindle Nigeria's economy, a village boy from Ovim wrote: "My social media channels are classrooms. And most times, I write things which deviate from the “typical” consensus, partly… pic.twitter.com/Yl15U9Kxwt

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