Maryam’s outburst
The writer is a senior political economist
Maryam Nawaz’s latest outburst on petrol price increase is unfortunate, to say the least. The stated position of the coalition government, the linchpin of which is her PML-N party, is that it assumed power to fix a defaulting economy. On more occasions than one, the senior leadership of the party present in the country has made it clear that the objective would be pursued, even if it meant losing political capital. Despite initial dithering, some avoidable spending decisions and unnecessary delays in responding to the IMF conditionality, the signs of improvement are there. The rupee is strengthening and the stock market is up. But these are just the signs, mercifully helped by the reverse gear in the global commodity markets. They do not even scratch the surface of an economic structure crying for reform. Properly completed, the IMF programme will rescue, not reform, a task that has to continue beyond. A government consisting all but one party is in a position to carry the process forward. It must, however, back its economic team — the finance minister and the acting governor of the State Bank — fully and in no uncertain terms. To repair the damage done by the irrational political outbursts, the finance minister should be elected to the Senate and the acting governor elevated to a full tenure.
It all started with Maryam’s opposition to the fixed tax on traders through the electricity bills. In the past, traders have defied military dictators as well as political governments. Nothing was wrong with the tax proposal. All justifications given for its withdrawal, including the ones by an obviously hurt finance minister, were plain nonsense. The most ridiculous was the fear that the payment of electricity bills would suffer! There was little realisation that the surrender to one lobby would encourage others. This is reflected in the shoddy attempts to make good the resulting revenue gap. One such attempt was the adjustment of the petroleum prices that invited the strong response of walking out of a party meeting by its supremo and the daughter’s announcement that she ‘stands with the people’. Little does she understand that that the people will be nowhere if the economy is back to the old normal as a result of premature withdrawal from the longer than usual intensive care required by it.
It seems she did not take seriously what was written in this column on 3 June, 2022 under the title ‘A missing element in Maryam’s discourse’. Of course, the economy was the missing element. To repeat for her eyes: “One cannot emphasise enough that the issues of bread and butter, even in relatively good times, are closer to the hearts of the voting public than the high ideals of politics. Expectations of economic relief, particularly in a less developed economy, far exceed the understanding of the economic costs it might entail. Politics is said to be the art of the possible precisely because of the trade-offs between political and real economic cost. A leader who has reached the stature that Maryam enjoys today has to be immersed in the nitty gritty of economics so as to be able to convey the hard realities facing the economy in an appealing narrative.”
Instead, there is an appalling lack of appreciation of the brick by brick movement towards correcting, once and for all, the economic fundamentals derailed by almost every government since the mid-1980s. Enough of the talk of Qarz Utaro, Mulk Sanwaro or beggars are not choosers. After this, hopefully, the last IMF programme, we must learn to walk on our two legs.
Published in The Express Tribune, August 19th, 2022.
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