Half the story —Munir Attaullah

If the man who should know best — the Finance Minister — tells you he has been left a bankrupt country, what would you do if you were an actual or potential investor, domestic or foreign?

If honest, I would have to confess to being a relative moron when it comes to economics and finance. But, since when has the trivial matter of the absence of relevant expertise stopped us Pakistanis holding forth?

Besides, I have some half-decent excuses to justify venturing today into, what for me is, un-uncharted territory that I have avoided hitherto.

The primary excuse is the inescapable organic link between politics and economics: political actions imply economic consequences, and vice-versa, even though there is a latent paradox to contend with here. For, economic judgements usually require expertise, whereas the accepted paradigm of democratic politics is that everyone, regardless of expertise, or lack thereof, is entitled to his political opinions.

My second excuse is that whatever little I am going to say is not ‘economics’ anyway, but really informed commonsense that requires little by way of technical expertise.

That said, I can now state what has prompted this column: I find it a continuing exercise in frustration how, almost without exception, all the political talk shows that dominate our TV channels — and hence mould public opinion — totally ignore this vital link between politics and economics. Passionate political opinions are voiced, without any reference to their economic consequences. And the odd discussions on the plight of our economy are seldom explained in terms of the local and wider global political realities.

This defeats my intelligence. And this is so, despite my making all requisite mental allowances for television being a somewhat superficial medium that does not encourage ‘weighty’ and in-depth analysis. But, am I to really believe our professional TV anchors and panellists are such simpletons? Or is it the case that those ‘image building’ temptations — simplifications, ear-catching sound bites etc. — are irresistible?

But the consequences are all too clear. How can there be such a thing as ‘informed public opinion’ in this country when the opinion makers themselves, by and large, present us with only a one-dimensional view of a usually two dimensional, complex, politico-economic reality?

The most striking example of what I am talking about concerns the debates I witness on our government’s struggle against that violent mix of criminals and Islamic militants within our midst, who aim to impose their authority upon the rest of us, not by democratic means, but through force. In this context, how often have you heard the passionate view expressed that this is America’s war, not ours, and so the right thing to do is to firmly tell America to get lost?

Okay, let us suppose these geniuses are right. But why does all discussion never go beyond that point? When was the last time you heard about the possible economic consequences of our actually doing what they urge us to do?

Our current economic predicament is not a secret. What would happen if, in addition, the Paris Club refused us our debt re-scheduling, soft loans from the World Bank and the ADB dried up, and bilateral aid and grants from governments and other international agencies stopped? Are we not forgetting who crucially influences all such decisions, and therefore could so easily economically squeeze us till the proverbial pips squeak? Even our remittances could be easily throttled through the money-laundering excuse and manipulation of the international banking system.

As talk is cheap (actually, free), I would not expect such trivial and mildly irritating matters as the above, to induce a sober re-think amongst our ghairatmand lot. Instead, anyone raising such irrelevancies will likely be accused of ‘defeatism’ and ‘negative thinking’, unbecoming of Muslims. After all, are we not a nuclear power? And don’t we have some staunch and powerful friends who we can rely upon in our hour of need?

How our bomb will help, I know not. But will our great friend, China, and our rich Arab brothers, bail us out? Dream on. Will we ‘eat grass’ if necessary? I don’t think we grow enough besides having reservations about the quality.

Instead of possibly feeding us such airy-fairy nonsense, I have some concrete suggestions. Would these opinion makers like to guess — and tell the public — what the exchange rate for the rupee, or the cost of petrol and electricity, or the rate of inflation, might be in those circumstances? And should those numbers be too frightening to contemplate — as assuredly they will be — why offer radical political solutions with nary a thought for their catastrophic economic consequences?

Another example is worth a mention. It is now fashionable for all and sundry, parrot like, to blame the flawed economic policies of the previous government for all our current travails. Now, I am not an expert to pass judgement on every aspect of this matter. Perhaps there is a strong case to answer. But the one thing commonsense tells me cannot be a sensible thing to do is what our first Finance Minister-designate (Mr Ishaq Dar), and sundry other politicians, did immediately after the elections: issue powerful statements of doom and gloom regarding the horrible economic legacy they had been bequeathed.

Well, if the man who should know best — the Finance Minister — tells you he has been left a bankrupt country, what would you do if you were an actual or potential investor, domestic or foreign? Whatever be the truth of the matter, the first duty of the Economic Czar is to ooze re-assurance, not create financial panic by scoring political points.

We have our economic woes to contend with, certainly. Whether it will help our people to brave these tough times with fortitude if they were better informed that the whole world is suffering similarly, I cannot say. But what I can say is that the media, by ignoring this wider perspective, and focusing solely on our internal plight, only succeeds in creating the perception that our troubles are solely attributable to our own poor governance. This only serves to further erode the public’s confidence in their government. And that makes it that much harder for the government to sell and implement the needed difficult and painful corrective policies.

The KSE has crashed? The Indian stock market has suffered a similar decline, and Shanghai and Singapore are down even more spectacularly. Our currency has depreciated sharply? The Indian rupee too has fallen by around 15 percent. Visit Dubai if you want to know about food inflation. And few countries have not felt the impact of rising oil and commodity prices. The British Chancellor of the Exchequer has warned that the UK faces its probably worst economic crisis for 50 years. And American financial woes are headline news every day. It is fantasy to assume we could have escaped unscathed from the international turmoil.

But then, it is easy to be a master of politics and little else.

The writer is a businessman. A selection of his columns is now available in book form. Visit munirattaullah.com

Source: Daily Times, 7/10/2008

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