As a nation, we have to collectively start making huge cuts in energy consumption — let’s be frugal for a change. This could well be Keynes’ “temporary period of adjustment”
The PPP government these days is considering reducing the working week to five days — and proposes a petrol-less day, Friday. All of it to conserve energy. If we can save power, work less, and have more time for leisure and our families, then why not?
This is also what some great minds have been proposing for a while — reduce working hours to guarantee a good life. Take John Maynard Keynes, who in 1930 “predicted [the] working week will be drastically cut, to perhaps 15 hours…with people choosing to have far more leisure as their material need were satisfied,” writes The Guardian’s economics editor Larry Elliot in a recent article.
This was when the world was gripped with economic problems, in the midst of the Wall Street crash, yet Keynes believed it was a “temporary period of adjustment”. He predicted, as Elliot points out, within a hundred years, living standards in progressive countries would be between four and eight times higher and this would leave people with far more time to enjoy the good things in life.
He was right. Living standards in western economies did improve, and are expected to increase eight-fold by 2030.
But the recent trend of people desiring to work longer hours proves Keynes “spectacularly wrong”, according to Elliot. He explains: “Rising living standards have not led to people deciding that they can satisfy their material desires through a much truncated working week. The number of hours worked in the United States has remained pretty much steady for decades, and is 30 percent higher than in Europe. Europeans tend to use up all their holiday entitlement; Americans, even though their vacations are shorter, do not. The decision by Nicolas Sarkozy to scrap France’s 35-hour week suggests that the American model is gaining the upper hand. Workers in the west are told to work longer and harder to meet the brutal competitive challenge from the east. If Keynes was right about a life of leisure, more of us would be working four-day weeks. As it is, the trend is in the opposite direction.”
I suppose when Elliot was providing the above explanation, he was unaware of where we have our heads stuck — in giving all global trends a good spin!
Ironically, a shorter working week for all good reasons is not considered to attain the good things in life, like leisure. It’s not about the material, rather the basic needs. Here we are trying to make ends meet.
We are told that mainly because of the increase in international oil prices and higher consumption at home, the oil import bill has escalated to $11.38 billion, almost 30 percent of total imports in 2007-08, more than 55 percent higher than $7.33 billion a year ago.
To contain the figures, Finance Minister Syed Naveed Qamar, who also heads the Economy Monitoring Committee, directed the petroleum ministry to suggest ways of curtailing oil consumption. The two main steps proposed are: five weekdays and bringing petrol consumption down by almost 20 percent.
The idea is not new. The last PPP government had also introduced Saturdays and Sundays off but the decision was reversed soon after — reportedly because it resulted in higher fuel consumption and government employees started taking three days off.
Many private entities, NGOs and educational institutions for instance do successfully follow a five-day working week in the country, without indicating productivity losses or absenteeism. In fact, Dr Faisal Bari, Associate Professor and Head of the Economics Department at the Lahore University of Management Sciences (LUMS) says, “a five-day week is not a bad idea. Forty-hour working weeks are considered to be normal and full time work in many countries. So, we should be thinking of five-day weeks anyway.”
But it failed the first time the PPP government implemented it. Does Dr Bari think it’ll work this time around?
He is sceptical. “It is hard to see what the net effect will be. It’ll work to some extent if the government offices are closed.” He fears a lot of private offices and factories may not follow the rule strictly — “they must, otherwise the effect will be marginal.”
Farooq Tariq, Secretary General Labour Party Pakistan, predicts that shortening the working week will fail to bring about the required results — because the government is incapable of implementing a policy. “This at the end of the day will merely be a cosmetic measure.” He wonders how the wages of will be protected and over-time rates determined. “It’s most likely that the employers will cut down the salary on the basis of reduced working days in a week. The government so far has been unable to guarantee Rs 6000 as minimum wage. Expecting anything more is foolish,” he insists.
Persistent abject poverty has compelled many low-income employees to opt for second jobs. And with a shorter work week and more time at their disposal, people may feel further encouraged to do over-time on Saturdays, or second jobs. After all, the rewards for doing so are considerable. Already a large number of lower-level government employees have additional jobs. Karachi-based economist Haris Gazdar feels if this trend continues, energy consumption levels might not be reduced — “The idea is to cut down the number of person trips per week.”
The issue of energy consumption has other sides too. First, says Gazdar, is the obvious one: to raise prices to reflect the true cost of energy — “which has already been done”. Second, medium-term measures like ensuring comprehensive metering so that users do pay for every unit. Third, another medium-term measure is to switch to more efficient vehicles and electrical equipment. The fourth medium- to long-term move is to invest in renewable and sustainable energy sources.
In addition, Dr Bari suggests domestic tariffs should be raised. But baseline consumers must be protected. “Say we keep the same price for the first 200 units or so but increase it for the rest of the society to reflect costs. We need to lower rates for industry and commercial activity but that also means we have to increase rates for domestic usage.” This, he agrees, may hit the middle class hard as it is voluble — “it must be done. Raise the rates and the demand will come down”.
He further says that the authorities must charge more for electricity at peak times and less at non-peak times to distribute load away from peak times.
Haris Gazdar believes the above measures will promise best results only if they are kept in sync with the regional framework — with Iran, Afghanistan, Central Asia and India. Also, for greater domestic investment in energy exploration we need quick a political settlement in Balochistan, and a similar arrangement to anticipate and take care of anxieties in Sindh. And finally energy imposes a liquidity problem — the long-term solution is in greater regional integration and, of course, help from friends abroad.
And help from within. It’s hard to imagine the Pakistani people responding to energy conservation efforts with anything other than contempt. But we have to face it: it is a crisis and it is hitting us hard. As a nation, we have to collectively start making huge cuts in energy consumption — let’s be frugal for a change. This could well be Keynes’ “temporary period of adjustment”.
Alefia T Hussain is a freelance journalist based in Lahore
Source: Daily Times, 18/9/2008