Dinosaurs of politics

August 06, 2011

When the dinosaurs of Pakistani politics will have their last hurrah is hard to guess.

By Kunwar Idris


THE dinosaurs’ last hurrah was 65 million years ago after they ruled the earth for 200 million years. Their extinction paved the way for the rise of the mammals who took another 10 million years to emerge from the desolation.

When the dinosaurs of Pakistan’s politics will have their last hurrah and how long it will take for a new breed of productive mammal-politicians to establish their rule is hard to guess. But 60 years of political dinosaurs in the modern time frame seems like a million of the pre-historic Triassic period.

Volcanic eruptions are believed to have set in motion the process of the dinosaurs’ extinction. Recent research by Micha Ruhl of Netherland’s Utrecht University (quoted by The Economist) suggests that it was methane, a greenhouse gas much stronger than carbon dioxide, that hastened their end.

Mounting popular protests, recurring natural disasters that wreck the lives of the poor and an upheaval resulting in the loss of the more populous half of the country have driven the old dinosaurian establishment comprised of politicians, bureaucrats and generals (often sustained by judges) close to their demise. Challenging judicial orders — already made or in the making — could prove to be their methane. They can buy time but not for long.

Dinosaurs were brainless reptiles. Their present-day human counterparts are brainy enough to realise that they must not defy the legal writ. It is not parliament but the constitution that is supreme, and the Supreme Court, and not parliament, is its interpreter in the last resort. The fundamental flaw of our senior, or ageing, bosses is the tendency to place their wishes, or orders, above parliamentary traditions, the rule of law, fairness and human rights.

Such is the attitude that marks their dealings with public servants. When a bureaucrat resists illegal or improper orders — mostly oral — it is hard for him to survive. He is considered defiant, a doommonger or partial to their rivals. It is not reason but personal pique that drives their actions.

Most civil servants barring sycophants whose number, sadly, is growing, fall victim to perverse political behaviour. The normal tenure of three years in senior and sensitive jobs was cut short for this writer to a few months on four occasions. No reason was given but, seemingly, the message conveyed was that the party boss, the chief executive or the chief martial law administrator can do whatever he likes and to whomever.

The result, notwithstanding pretensions to the contrary, has been that hardly any bureaucrat today goes by the advice of the founder of the nation “to act as true servants of the people even at the risk of any minister or ministry trying to interfere with you in the discharge of your duties as civil servants. I hope it will not be so, but even if some of you have to suffer as a victim — I hope it will not happen — I expect you to do so readily. We shall, of course, see that there is security for you and safeguards….” The Quaid’s hope that “it will not happen” and his promise of giving security both have been consigned to the archives. Ziaul Haq even mutilated the Quaid’s exhortations to suit his own designs.

The security that the head of state and father of the nation had promised can be given only by the constitution, not by the Supreme Court. The fate of Sohail Ahmed, a civil servant of undisputed competence and integrity, who was made OSD (he was subsequently appointed secretary to the narcotics control division) for obeying the order of the Supreme Court was in the hands of the prime minister who made him OSD.

Has the Supreme Court relented to avert chaos or is it the beginning of the end of independence of the judiciary and total subordination of bureaucracy to politics is a question that haunts the people to the glee of most party bosses.

Though much is said about saving the system, the reality is that political power today, as in the past, revolves around individuals. It is hard to believe that Mr Asif Zardari is head of state under the same system and constitution as were Chaudhry Fazal Elahi and Rafiq Tarar. It is equally hard to believe that Mr Iftikhar Chaudhry is chief justice of the same Supreme Court presided over by Mr Irshad Hasan Khan who allowed Gen Pervez Musharraf to amend the constitution if it failed “to provide a solution for attainment of his declared objectives”. Gen Musharraf later looked the other way when he held on to power for nine years against three sanctioned by the court.

The contention of Prime Minister Yousuf Raza Gilani that the question of the respective jurisdictions of the organs of the state will be resolved in parliament is untenable. Such a question doesn’t arise as the jurisdictions stand demarcated in the constitution itself and any dispute arising has to be settled in the Supreme Court.

Parliament can amend the constitution but it must not, even if the required majority is forthcoming, because its representative character is doubtful and its credibility low. The issue being debated, on the other hand, is fundamental and requires a fresh mandate from the people which can come only through elections held here and now. The political dinosaurs of all hues are understandably averse to that proposition for it might prove to be their last hurrah.

A mugging in Washington

By Irfan Husain


WHEN trying to pinpoint a date that signalled the terminal decline of the United States as a global superpower, future historians could do worse than pick Aug 2, 2011.

Although this was the day America pulled back from the brink of fiscal disaster, it was also the day the US Congress announced to the world how dysfunctional it had become. And far from being a solution to America’s economic crisis, Congress has now become a big part of the problem.

The unedifying spectacle of a handful of Republican congressmen holding their nation — and the world — hostage for weeks did little to reassure the rest of us that there was somebody at the helm in Washington. President Obama looked like a hapless victim of a mugging, handing over all his valuables at gunpoint to a bunch of hoodlums.

We may well ask how decision-making in Washington — often a messy business marked with compromises and wheeling-dealing — could have got to this hysterical level of brinkmanship. Pundits are quick to tell us that the Tea Party represents a grassroots movement that seeks a return to a small government with minimal federal spending and taxes.

Not so, says George Monbiot in a recent article in the Guardian. Reminding us that the Tea Party movement “was founded and is funded by Charlie and David Koch”, he calls the recent events in Congress a “political coup”. The Koch brothers are billionaires who have poured some $85m into lobbying for lower taxes for corporate America, combined with fewer and weaker regulations for industry. Monbiot concludes his article thus:

“A handful of billionaires have shoved a spanner into the legislative process. Through the candidates they have bought and the movement that supports them, they are now breaking and reshaping the system to serve their interests….” The last few years have shown us that despite bringing the global banking system to its knees through sheer greed, bankers continue to reward themselves with obscene salaries and bonuses. Indeed, the wealthy are highly adept at protecting and furthering their interests at the cost of the wider public good.

Again and again, politicians reassure us that what’s good for the rich is good for the economy as their profits will lead to investments that will create jobs. But currently, corporations in the US are sitting on a cash mountain that totals over a trillion dollars, and yet unemployment continues to rise. Indeed, over the past decade, the income of the top one per cent of Americans has risen by 18 per cent, while that of industrial workers has fallen by 12 per cent. So much for the trickledown effect.

The deal worked out to break the deadlock over the debt ceiling does little to fix the basic problem: how to plug the growing gap between income and expenditure. Currently, the US is a country that would like to offer its citizens a Nordic level of social security, but with the lowest taxes in the developed world. In addit ion, it would like to maintain its defence spending at the current level of $685bn.

Clearly, something has to give. In 1987, American historian Paul Kennedy wrote a prescient book titled The Rise and Fall of Great Powers: Economic Change and Military Conflict from 1500 to 2000. Here, the author examines the trajectory followed by a number of major powers including Great Britain, the Ottoman Empire and the United States. His conclusion is fairly obvious, but appears to have escaped most statesmen.

Basically, Kennedy argues that over time, a great power’s economy declines relative to its rivals, but its political ambitions dictate a large military. There is thus an overhang in which the state can no longer sustain its defence spending, and runs up large debts. According to Kennedy, rising defence expenditure “leads to the downward spiral of slower growth, heavier taxes, deepening domestic splits over spending priorities, and weakening capacity to bear the burdens of defence”.

This is an apt description of the United States today, excepting that the Republicans are refusing to raise taxes. This has created a situation where Obama, having inherited two wars from Bush, and pushed through expanded (and expensive) medical coverage, must now somehow find the money to pay for it all.

Given a political consensus in Washington, there might have been a broad agreement to reduce the deficit in a gradual manner to minimise the impact of the cuts on the most vulnerable sections of society. But with the dominance of big business over the Republican Party, and their distrust of Obama who they consider a radical socialist, any meeting of minds seems improbable.

While framing the US constitution, the founding fathers wrote in strong checks and balances to prevent the concentration of power in any one institution or individual. But as we have just seen, a group of uncompromising congressmen can hold a gun to the administration’s head, and threaten to bring the whole system to a grinding halt.

Another factor at work is the determination of the Republicans to make sure that Obama is not re-elected next year. To this end, they have consistently opposed him at every turn, making it very hard for him to govern. The whole business of the ‘Birthers’ who refuse to believe that he is indeed an American citizen and was born in Hawaii is a case in point. For weeks, the rightwing media hyped up this canard until, humiliatingly, the president of the United States was forced to produce his birth certificate.

Similarly, a significant number of Republicans believe Obama to be a closet Muslim despite his regular attendance in his church. Clearly, many Republicans have very strong reservations about having a black president, and while they can’t voice this prejudice openly, they continuously snipe at him in an effort to bring him down at any cost.

But judging from their latest effort, the cost can be very high indeed. The level of polarisation they have introduced into politics is making it very difficult to forge a consensus on any issue. The American — and the global — economy is much too fragile to subject it to the kind of cliffhanger drama we have just witnessed.

In a recent poll, a large proportion of Americans said they thought their representatives had acted more like children than adults. Hopefully, come next election, these politicians will be sent back to nursery where they belong.

Towards Financial Meltdown 2?

By Larry Elliott


THERE was a whiff of August 2007 in the air on Thursday as financial markets tumbled around the world. More than a whiff, in fact. The familiar stench of panic was back as shares fell heavily, bond yields in Spain and Italy rose and the search for a safe haven sent the price of gold to a new record level.

Banks took an especially severe pummelling amid fears that they were exposed to the two big concerns of investors: a break-up in the eurozone and a double-dip recession in the global economy.

In a week of anniversaries, it was a day that conjured up all the wrong sort of memories. It was 97 years since Britain declared war on Germany, and the resulting financial turmoil meant the stock market, which had closed at the end of July did not reopen for business until early 1915. Yet even in the month or so after the assassination at Sarajevo, when the Great Powers gave up on diplomacy and prepared for conflict, the movements in financial markets were less violent than they were on Thursday.

More recently, it is almost four years since an announcement by the French bank BNP Paribas that it was temporarily suspending three hedge funds specialising in US subprime mortgage debt led to financial paralysis. Banks, it was discovered, had lent unwisely, were loaded up with toxic derivatives that were vulnerable to falling American house prices, and had far too little capital set aside for a rainy day. On Aug 9, 2007, the heavens opened.

On the face of it, the banks are in better shape than they were when the British bank Northern Rock became the first major UK high street lender to suffer a bank run since Overend & Gurney in the 1860s. They have been forced to build up capital reserves and to hold a higher proportion of their assets in liquid form — financial instruments such as government bonds that can be quickly turned into cash.

Financial regulators have spent the past four years crawling all over the banks, making up for the not-sobenign neglect in the days leading up to the crisis, when supervision was far too lax. The UK’s Financial Services Authority, the European Banking Authority, and America’s Federal Reserve know where all the bodies are buried in their respective banks. In theory, at least. One of the parallels between August 2007 and August 2011 is the shiftiness of those running the show, a sense that they are not letting on all they know for fear of creating more panic.

The dwindling band of optimists point to differences with four years ago. Many companies, especially the bigger ones, are in rude financial health after cutting costs aggressively. Parts of the emerging world, such as China and Russia, are growing strongly and may act as the locomotive for the rest of the world. In the West, interest rates are low and budget deficits high: policymakers have pressed the pedal to the floor in an attempt to get their economies moving.

But the ultra-loose state of macro-economic policy cuts both ways. Policymakers were the heroes of Meltdown 1, thumbing through their copies of Keynes’s General Theory to come up with the measures deemed necessary to prevent the global banking system from imploding. But if the next few weeks see Meltdown 2, the policy options will be limited. Interest rates are already at rock-bottom levels while the flirtation with Keynesian fiscal policies was brief. As one analyst put it, the monetary and fiscal guns are not obviously full of bullets.

Thursday’s mayhem will fan speculation that the Federal Reserve will respond with a third dose of electronic money creation through the process known as quantitative easing. Cheap money and big budget deficits certainly averted a second Great Depression, but it has not produced the normal snap back from recession seen during the post-Second World War era