Capitalism need not apologise

To those who have watched the financial crises of the United States and Europe unfolding with glee and pronounced with unabashed joy that capitalism is about to die, or at the very least, humbled, I have some very bad news: capitalism is very much here to stay and is not about to apologise to anyone for the mess the world is in.

Most Pakistanis do not think about how the economy should be organised, but it is surprising that amongst the few that do, a large number does not believe that the nation’s economic foundations should be built upon the principles of free market capitalism. It is nothing short of appalling to see even economics and business school professors at leading Pakistani universities support policies that are nothing short of populist drivel.


Take, for instance, the nonsensical idea that the government should own and operate companies for ‘strategic reasons’. To those that say that, I have one question: is it part of your ‘strategic’ plan to also ensure that these companies do not function adequately and constantly require bailouts? Is it worth spending more than Rs250 billion every year to keep propping up these ‘strategic’ companies?

The fact remains that, for all its flaws, the free market remains the best known system for organising an economy. Yes, the government needs to act as a regulator to ensure that everyone plays by the rules and ideally, the government should provide a basic set of services (education, infrastructure, etc) to ensure that there is a level playing field, but the government should not attempt to run companies on its own. It is absolutely laughable that the government thinks it can ‘create jobs’ by employing people in state-owned companies far beyond their capacity and need and then pay for them with bailouts. In essence, this is nothing short of stealing my tax money and giving to a politically connected constituent of some minister. I am surprised more people are not outraged.

So when I hear babbling about how the government should not sell off companies it owns for ‘strategic’ reasons, I would like to say this to the Zaid Hamid-style populists: you have no idea what you are talking about. Stick to your silly political conspiracy theories and leave the business of running the economy to those who have bothered to try and understand it.