Robin Hood economics
Khurram Husain
NOW don’t get me wrong. I’m all for “recovering looted wealth” and I’m all for using the proceeds to help educate our youth.
I’m also all for hiking outlays on health, and I would like nothing more than to see our government’s expenditures soar by almost 400 per cent in five years.
The intention behind many of the reforms proposed by the Pakistan Tehrik-i-Insaaf in its “economic plan” is admirable, although one is at a loss to see how it will actually work. It’s hard to see where the money will come from to pay for the boost in welfare spending and deficit cutting considering the major potential revenue heads now belong to the provinces.
The plan purports to run the country through a state of emergency. Every category of the plan is headlined “emergency”. So once voted in, we are told, the party will declare an “expenditure emergency’ and a “revenue collection emergency” and a “governance reform emergency” and an “institution reform emergency” and so on.
There follows beneath each heading a series of steps that sometimes read like they were written up by Robin Hood himself. They range from the comparatively basic steps like “all symbols of Pomp and Glory to be shut down” to bombastic declarations of a “Frontal Attack [sic]” on cartels and speculators and hoarders and gas and electricity thieves.
All this has been tried many times already. Remember the attempt of the Competition Commission to penalise the cement cartels in 2009 or the stock market crash and investigation of March 2005? Where did the 2009 suo motu against the sugar barons lead? Too often the pursuit of vested interests leads back to the homes of your own partners in power, and it’ll be no different for the PTI.
For all the apocalyptic metaphors that the party is so fond of there is something that they don’t know about their favourite one: the tsunami. Eventually all tsunamis recede, and the ground reasserts itself as the waters inevitably move back to the oceans from whence they came. The land always wins against the tsunami.
I don’t doubt that election night will be a big night for the party, although exactly how big remains to be seen. But that night will end, and the thousand and one nights that will follow will see the stubborn reassertion of the status quo, the same political landscape, the same constellation of capital and constituency, that the party claims in its economic plan it is out to destroy.
Without a firm foothold in the new political set-up, the plan becomes a little irrelevant, considering that when the curtain rises on the next parliament, it’s highly unlikely that the PTI will carry enough votes to form a government on their own and they are more likely to become embroiled in the politics of transition.
To whom will the party reach out for a coalition? The PML-N? The PPP? What will they do with the MQM, the regional party whose support has been essential to almost every government since 1988? Or will they choose to sit in opposition for five years?
And then there’ll be the stubborn reality of Pakistan’s economy, its many complex dysfunctions and difficult trade-offs.
Diverting gas from industry to power, to take one example, something the plan presents as a solution to the circular debt has always met spirited resistance from industry, and will likely discourage investment.
Gen Musharraf tried to rule the country through a far more drastic state of emergency than the one the PTI is envisioning.
Almost everything their programme talks about was tried in the first three years of the general’s rule.
There was a slash and burn accountability drive, loan recovery drive, documentation of the economy drive, imposition of GST drive, and so on. It all petered out with a whimper.
In over a decade of dedicated pursuit, NAB couldn’t even recover Rockwood Estate, and where it was pursuing dozens of cases against the ‘top leadership’ of the PPP and the PML-N, it had to declare the top leadership of the PML-Q to be squeaky clean, and was talking about recovering five billion from this scam here and seven billion from that scam there.
“Recovering looted wealth” sounds good to the ears, but always snags on the inconveniences of the law, of multiple jurisdictions, and of overlapping political loyalties, and it makes for a lousy platform on which to build a vast spending plan.
Nawaz Sharif was bequeathed a vast mandate to rule through the election in 1997. Gen Musharraf, who took on titles of state like they were feathers in his plumage — he was at one point the prime minister, the president and the army chief all at the same time — was forced, by 2002, to square his game on the same status quo he had sworn to uproot in 1999.
With all their power, both these rulers failed at many of the reforms the PTI is claiming it will undertake, including the Robin Hood economics.
So what makes the PTI think they will succeed where these two failed in bringing about revolutionary change? Not even the most optimistic take on their prospects sees them taking anywhere close to the number of seats in parliament that Nawaz Sharif had in 1997.
And no matter how much the party of the establishment they may be, they will never be more of an establishment’s party than Musharraf was prior to the 2002 election.
Keeping in mind the political realities the party will be operating within, it seems unlikely they will be in a position to take on the powerful vested interests that have consistently thwarted the kinds of reforms the party’s economic plan envisions.
http://dawn.com/2012/08/30/robin-hood-economics/