Globalization, Governance and Growth

"I never met anybody who said when they were a kid, I wanna grow up and be a critic." Richard Pryor. A perspicacious remark, if there ever was one; even this particular invidious endeavor was not undertaken willingly; columnists hardly have the leverage to flout the editor's authority. The more ominous downside is that dreams of Pulitzer suddenly turn apocalyptic on realizing that what goes around comes around; already a bunch of vengeful authors probably have knives drawn, just waiting to critique any similar adventure by this author. Nonetheless, onwards the light brigade.
At the outset, the author is an extremely distinguished member of Pakistan's intelligentsia, with a career spanning many decades, and experience ranging from working with the World Bank, Governor State Bank of Pakistan, Chairman, National Commission for Government Reforms and currently Dean and Director, Institute of Business Administration, Karachi; and he also has a number of publications under his belt. Accordingly reviewing his book was a rather overwhelming experience and there is a need for a clarification: the review hereunder is meant to be an honest and positive critique without any kind of bias.
The book in question is a compilation of articles, speeches and contributions by the eminent author over, roughly, the last decade. While, in this particular case, compared with the last such book reviewed, the inclusions are accompanied by date and place of original submission, nonetheless the very belief that there is an audience interested in old write ups is contentious in addition to making any review an extremely tedious task. The bigger risk is that with time views can change, and earlier views if not edited might even be embarrassing.
For instance, in a particular article included in the Globalization section of the book, the author positively asserts that it makes sense for banks, as originators, to pool and securitize their mortgage portfolios and sell it to institutional investors; the very recipe behind the sub-prime crisis. This keynote address was obviously before 2008; and for the record, there were those, albeit a small minority, who actually predicted the crisis. In another piece, retired government officials writing on the economy, are chastised for being unsympathetic and unconvinced, due to a myopic mindset, about any good emanating from reforms; empirically the shoe eventually does get on the other foot eventually. An assiduous editing might have resulted in expurgating such content.
Contrary to changing views, continuity of views has its own demerits. It was rather monotonous to repeatedly read the same disquisitions on globalization, governance and in certain cases growth, albeit in the last case there was a distinct change of flavor precipitated by a miscellany of sub topics covered. In fact at certain times there was a distinct feeling of déjà vu, or rather it appeared to be a case of, with a contrite apology, self-plagiarism. Notwithstanding, generally the views on all the three subjects covered in the book, appear to be off-shoots of the World Bank and International Monetary Funds (IMF) programmes, with the dictates of the Washington Consensus taking the limelight. This might have to do with the author's long association over his career with the two institutions, or perhaps more likely reinforcement of the dictum about not reinventing the wheel. On the other hand, at a particular junction in the book, structural reforms are championed as the enabling strategy for the country to reassert its economic sovereignty and get out the stranglehold of IMF. At another juncture, dependence on IMF and other traditional partners is deemed an unviable option.
On globalization the views adroitly assert that it is here to stay and carries enormous challenges for developing countries. Accordingly the suggestions for Pakistan are: fundamental and irreversible structural reforms with a focus on fiscal discipline; removal of infrastructure bottlenecks and energy shortages; tackling corruption; tackling security concerns and social unrest; deregulation and strengthening of institutions, especially property rights and rule of law; and outward oriented strategies. Which is all good, except an open trade policy seems to be suicidal if increase in imports surpass the expansion in exports, massively.
"Governance constitutes for ordinary people, a daily struggle for survival and dignity. Ordinary people are too often humiliated at the hands of public institutions. For them, lack of good governance means police brutality, corruption in accessing basic public services, ghost schools, teacher absenteeism, missing medicines, high cost and low access to justice, criminalization of politics and lack of social justice. These are just few manifestations of the crisis of governance."- UNDP -Human Development Report for South Asia- 2005. A brilliant articulation indeed, therefore reproduced from the book in entirety. The proposed solutions are: accountability, transparency; reforms relating to size, structure, scope of the federal, provincial and local governments; civil service reforms, which from the face of it appear undoable;
The bitter pill for growth includes: a robust and empowered system of local government, which again seems like a bridge too far; an integrated budgetary framework under which the provinces accelerate their tax efforts and generate budget surpluses; curtailing of government expenditure and consequently the budgetary deficit; revamping the PSDP with a focus on priority projects compared with a "hodgepodge of projects financed on political rather than economic considerations"; defining the boundaries between government and the private sector; "All hands on deck approach to educate our young"; ensure clear property rights and a few others.
The above formidable list of suggestions is perhaps not unique to the author, all experts agree to the problem and solutions, except that a pragmatic and detailed plan remains elusive for a multitudes of reasons; with buy in by the political elite topping the list. The compilation perhaps should have concluded with precise and concise steps for growth based on the experience gained during his stints with the government.
On a lighter note, Dr Ishrat believes that the nationalization of 1971 caused a major disruption to economy and had a negative impact on industrial development, export expansion and quality of education; the buoyancy witnessed in 2002-8 could not be sustained due to lack of continuity and consistency of policies and unpredictability of business environment; judicial activism did a great deal of good in establishing an equilibrium between the pillars of government but on the other hand Judges of superior courts are not trained and experienced in the art of economic policy formulation.