The Pakistan Tehreek-e-Insaf’s reasonably good economic policies are being overwhelmed by political and public relations blunders. You didn’t need a PhD in economics to know that Naya Pakistan will have to run to the IMF to pay for the sins of Purana Pakistan. Why create the illusion that $200 billion in illegal wealth stashed abroad is coming home soon and auctioning the ex-prime minister’s buffaloes as a solution? Naya Pakistan’s future hangs in the balance as the PTI’s politics and governance fight each other like parents on the brink of divorce.
The PTI’s economic policies are actually not that bad given what they inherited. Suppose Pakistan is a family with Rs100 of expenditure every month. We spend around Rs36 on interest payments and another Rs18 on defence. Our monthly income is around Rs80 so we still borrow Rs20 a month to make ends meet. We have one urgent issue at the moment, which is a balance-of- payments crisis ie lack of dollars. The other issues in the economy are structural but long-term challenges like a small tax base, public sector company losses and unemployment.
Asad Umar is fighting on all fronts. Approaching the IMF is the right thing to do to create space in our external account. Beyond the IMF, Asad’s mini-budget also attempts to begin the journey on structural reform. It’s okay to get criticised by the media when you make bad policy but Asad is actually making the best policy he can make at this time. The problem is that expectations of his constituency are being hyped up by members of his own party who claim that bringing back looted wealth or Imran’s charm offensive in Saudi Arabia can solve Pakistan’s problems.
It’s not a failure of policy but a failure of public relations and political strategy. Consider the Atif Mian episode, the austerity drive, the “I will commit suicide if we go to IMF statements.” The PTI isn’t making U-turns, it’s like their politics and governance are driving on two different roads. Fortunately, this is an easier problem to solve than bad policy or corrupt actors. It requires austerity in communication and politicking. And the courage to tell the nation not just what they want to hear but what they need to hear.
The truth is that Pakistan is a drug addict who can’t live without heroin (read: dollars). It’s not just our rulers but we the people who are used to living beyond our means. For example, the reason gas prices are rising so sharply is because the government has been subsidising them for decades and the low prices have allowed us to waste gas versus use it like the precious commodity that it is. Like a doctor trying to wean off an addict from heroin, Asad is weaning us off subsidies we cannot afford. It hurts. We’ll scream and shout. But it’s good for us. And that’s the story Asad needs to tell.
So far, the PTI’s story on economic reform is that the last government left us a big mess and we have to take these painful measures now to course correct. That’s a double negative and gives us no hope. The PTI needs to deliver a more optimistic message by saying we’re cleaning up decades of misrule by taking painful measures that will result in decades of prosperity (play hero versus victim). Stop selling false, politically popular short cuts like China or Saudis rescuing us, corrupt money coming back, etc. It raises the expectations on your economic team to deliver miracles instead of sound economic policy.
This requires austerity in communication. We should have one official spokesperson — perhaps the Leader of the Opposition — I mean the Minister of Information, as the only person communicating official policy. Instead of now, where every adviser to the PM and his mother-in-law are pontificating on Twitter. It’s ironic that the PTI is doing the right thing for Pakistan (economic policy) but wrong thing for itself (by messing up their communication). Forget civil-military relations, here’s to hoping the PTI’s politics and governance can be on the same page. Otherwise, Nawaz won’t be the only politician asking Mujhey Kiun Nikala.
Published in The Express Tribune, October 14th, 2018.