Get the basics right!
This is a term that my friend Meekal used with me today. All we need is get the basics right! Others around the table also yelled, “it is not rocket science!” All we need is “Get the basics right!”
My question “what are the basics?” was drowned out! We all know what the basics are without actually talking about it. This is how economics is done in Pakistan.
With persistence I found out what the basics were.
· Get inflation down
· Increase revenues
· Increase exports
· Increase growth
Makes it easy! Does it not!
We wish all the good things and call it economics.
For sixty years Plan after Plan as wished for these good things, increase production, increase growth, increase exports. It is just so sad that the economy will not listen to these economists and deliver all good things like production, growth and exports. And not to forget that all this must happen with low inflation.
Of course we must keep asking for more revenues and every discussion must not well-worn examples of the rich not paying taxes. Ok so let us have a new tax and collection must improve. There you go. Now see “It is not rocket science!” What is it about rocket science that these guys like? Every three minutes, someone mutters “it is not rocket science!” and all nod in agreement. Discussion killed! Time for next anecdote!
Well how about another list of basics!
· Improving law and order
· Securing property rights
· Strengthening contracting
· Reducing transaction costs
· Redesigning and reframing markets for efficiency
· Removing incentives for rentseeking and putting in place incentives for entrepreneurship
This was what government was supposed to do. This is the basics of governance! Sure it requires hard work and much thinking to make this happen. And yes it is even more complicated than rocket science.
If our friends would be more inquiring, they would find out that the development experience of the last sixty years has shown the primacy of these basics over their usual list of basics. Without better governance, all those good things that our economists take with for may not happen. A little reflection will show that Plan after Plan wishing for increased growth exports and production with higher revenues have come to naught because of “poor governance!”
Perhaps, saying “it is not rocket science!” stops these people from thinking. All of us need to come out of our comfort zone and encourage discussion and debate.
My question “what are the basics?” was drowned out! We all know what the basics are without actually talking about it. This is how economics is done in Pakistan.
With persistence I found out what the basics were.
· Get inflation down
· Increase revenues
· Increase exports
· Increase growth
Makes it easy! Does it not!
We wish all the good things and call it economics.
For sixty years Plan after Plan as wished for these good things, increase production, increase growth, increase exports. It is just so sad that the economy will not listen to these economists and deliver all good things like production, growth and exports. And not to forget that all this must happen with low inflation.
Of course we must keep asking for more revenues and every discussion must not well-worn examples of the rich not paying taxes. Ok so let us have a new tax and collection must improve. There you go. Now see “It is not rocket science!” What is it about rocket science that these guys like? Every three minutes, someone mutters “it is not rocket science!” and all nod in agreement. Discussion killed! Time for next anecdote!
Well how about another list of basics!
· Improving law and order
· Securing property rights
· Strengthening contracting
· Reducing transaction costs
· Redesigning and reframing markets for efficiency
· Removing incentives for rentseeking and putting in place incentives for entrepreneurship
This was what government was supposed to do. This is the basics of governance! Sure it requires hard work and much thinking to make this happen. And yes it is even more complicated than rocket science.
If our friends would be more inquiring, they would find out that the development experience of the last sixty years has shown the primacy of these basics over their usual list of basics. Without better governance, all those good things that our economists take with for may not happen. A little reflection will show that Plan after Plan wishing for increased growth exports and production with higher revenues have come to naught because of “poor governance!”
Perhaps, saying “it is not rocket science!” stops these people from thinking. All of us need to come out of our comfort zone and encourage discussion and debate.
Re: List of Basics, let us consider:
ReplyDelete- Removing economic basis of feudalism and serfdom through Land Reform, and Land for the Landless peasants
- Break up the special interest groups and robber baron lobbies in energy, agricultue (sugar), steel, textiles that are preventing economic progress
- Investigate which groups are preventing Pakistan from leveraging its coal resources for energy production
- Publish a list of Compradors and all malign foreign agents
Azhar
I couldn't agree more with the author. I would also argue that Pakistan needs to get rid of some of its old rottening economists, espceially the ones who retire from internatinal organizations and then occupy key the policy making positions.
ReplyDeleteSometimes the most obvious things seem so impossible. Why?
ReplyDeletePerhaps because we lack the courage to challenge the status quo. Why?
Because our culture teaches us not to question or challenge authority. If you do, you get beaten up by your father, mother, brother, teacher, mullah. This starts from the family and society is a reflection of this.
We must question and the challenge received wisdoms in order to change. We may well get beaten up in the process. Then the obviously basic solutions may not seem so out of reach.
Who will teach us to question and challenge? The media can play a huge role. If not the media, who else?
Well, I think atleast PMLN will be better in governance instead of PPPP. The most powerful Economic body of any country is Planning Commission but the way previous govt put some irresponsible people on key positions was nothing but a shameless act.
ReplyDeleteFirst thing first is we must bring patriotic Pakistani on these key positions instead of those who start from abusing Pakistan.
Secondly, Believe in ourselves with one single thought, "We Can Do Anything or Any Miracle" and we have to work hard to achieve our goal.
Thirdly, Do not ever try to bring again any retired IMF, WB or ADB people on any circumstances and keep a distance from them always.
Really strange replies. We always love to criticize people not ideas. Though I am diametrically opposite to some of his ideas other than economics. But its better if we disagree with Dr.Haque and argue that the basics he is talking are wrong.I agree with him on governance, institutions, property rights, abolishing rent seeking behavior, enforcement of contracts , entrepreneurship, fast connectivity and lowering transaction costs. Just imagine how rightly he is pointing out about cities role in economic growth but most of us and media guys still boasting of making "MASALI GAON". Rural people welfare is directly deternmined by urban prosperity. All demand originate from urban area for rural products, so make your cities dense, walkable, it will have economies of scales, benefits of specialisation, reduce CO2 from cars, increase retail business etc. So lets disagree but dont go against each other.
ReplyDelete