Thoughtless economics

The international agencies have done it yet again with us. They have taken us to the brink before and they will do so now. The reform decisions of Musharraf's time are known to have been sponsored by a UN agency but backed by a big power on the world stage. That Pakistani decision-makers are unable to take decisions themselves is now clear. They are also unable to put it in black and white. In other words, they are totally dependent on the international agencies.
The West has for some time been a faithful articulate of Reagan and Thatcher form of neoliberal economics. They may have moved away from it but we are being forced into this. That social harmony is a necessary aspect of any economic activity and in fact the basis for any investment local or foreign is now being realised. We have heard the slogan by all investment chefs in the Board of Investment eulogising the West and other countries to participate in the country's welfare and profit to themselves; all to no effect.
That this neo-liberalisation is the new (now middle aged) paradigm shift that the IMF and the WB follow is apparent from Pakistan's just concluded agreement with these agencies. It is apparent that the agreement is meant for the further concentration in industry in the hands of the few. The tax policies and the economic policies generally have the interests of the elite rich in mind. The world has noted with concern that the policies are meant for the roughly one thousand corporate sector institutions. Pakistan through this agreement will also be catering for the rich and the elite not the poor. When these public sector entities are set for privatisation the only likely buyers will be the limited 22 families that Dr Mahboobul Haq spoke of but which were the results of policies he had set up and articulated on behalf of the West.
There is very little concern as to what these neo-liberal policies are supposed to mean. Neo-liberal initiatives are characterised as free market policies that encourage private enterprise and consumer choice, reward personal responsibility and entrepreneurial initiative, by doing so they undermine the dead hands of the bureaucracy. Governments no matter of what ilk by the West's standards never perform even if they are well intentioned. I do not understand the universality of policies for, to me, they do not take into account the peculiar culture and characteristics of a country. The straight jacket implementation of policies creates more problems without solving the ones they are supposed to address.
In Pakistan's case the privatisation of loss-making entities needs to be addressed. Our previous two excursions into privatisation have led to the incarceration of two ministers. The possibility of another joining their ranks cannot be ruled out. What have these private sector industries provided to the consumer. Have they shown any sense of responsibility? Has KESC shown that responsibility? Have the FBR reforms undertaken in the light of these polices borne the fruit that should have come the public way? Privatisation in the Pakistani scene is the trampling of the rights of the common man and the consumer wherever he is to be found. The average Pakistani to become an essential part of the consumer society that is supposed to come after the implementation of these policies. There is sacred aura about these policies now. The rationalisation that comes with this kind of untrammeled policies is that there is no debate on the issues rather on the impact. The wealthy are never taxed as they are part of the elite ruling the country. There is no informed debate although some anchors try and make it look as if they are aware of what is happening. The debate generally ends up in a shouting match. Corporate sector domination is now on the front burner in Pakistan. The privatisation objective really was to ensure that the entrepreneurs increased and the concentration of industry is given up and a competition policy adapted.
By exacting policies for the rich they have created a whirlpool and increased inequality and the gap between the rich and the poor. These policies for the few wealthy mean that the social dimension, that is already far from satisfactory, will be more and more exacerbated over time. The armed conflict aside the economic conflicts will be more difficult to manage. We are already seeing this in Pakistan. A marked and severe deprivation is affecting Pakistani society - the effects of which are already visible. That is the underlying reason for all the turmoil that we are seeing. All this is beyond any political party's purview. A joining of heads or as they are fashionably saying to be on one page is going to be of no avail. The reason one is saying this for is the fact that we have very few responsibly selfish people in this country. The private sector is not there in this country. It is always provided for by the government of the day and as such is quasi private.
There is no evidence that is put forward to determine the veracity of the policies so enunciated. The market is supposed to do the needful. No interference in the market should be done, say the adherents of the policy. If that be so then why is the USA correcting itself every now and then when the markets fail? What happened in the housing market and in the bailout of the banks? So the point that is being made is that when we make our own mistakes we will be able to correct ourselves but when we take anything from somewhere else and adopt it mutatis mutandis (as it is) we are in severe economic difficulties.
Some of these are because of a falling rupee-dollar equation but more so because other sectors of the economy are ignored. Agriculture seems to be the most neglected and since this has to do with the rural areas there will be hell to play when they realise that they have been ignored and are the step-sons of the economics of this country. Like the proverbial Shylock our rich force the hands of the willing governments into acts that are contrary to well being and harmony. Agriculture policies are difficult to universalise as these are site specific and defy policy makers that are situated in Islamabad. All governments irrespective of hue or colour are responsible for this lack of attention. All pay homage to the West by buying their policies, more so the tyrannical policies. Economic policies work not alone but have an influence over the political and cultural system as well. Neo-liberal policies also give way to perverse democratic interpretation. Democracy and neo-liberal policies, say the gurus, work well together and for any fledgling democracy such as ours there is always welcome. This is powerful thought for the newly elected powerful incumbents.
Pakistan will have to work harder at adapting economic polices that work well in this pluralistic system of ours. If not we should be prepared for the worst kind of savagery that we are encountering at the moment and that we will be encountering in the future. The half-baked policies that I hear on the electronic media are a preparation of a battle ground for the future. Urbanisation that is unfettered is what we have in Lyari and the newly emerging Bhara Kau on the outskirts of Islamabad. It is for no reason that we have had three incidents here akin to the start of Lyari type action. If one were to go into one of the galies [narrow streets] of Bhara Kau the makings of a new criminalized activity will be visible.
Is capitalism to be furthered by its gloves off? Defunct policies or policies that are not made relevant to social and cultural aspect of a poor nation will invariably lead to more perverse activity and the rule of tyrant on its people. Take good care and do not accept anything without questioning its veracity.