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No better time than election season to make the case – very controversial one, it turns out – that Pakistan’s democratic traditions are part of the problem, not the solution; especially with default, painful structural reforms and a lost generation looming on the horizon. The most obvious problem is that political leaders are forced to lie to the people simply because the electorate does not respond well to the hard truth in hard times.

Imagine a committed leader telling voters to choose him because he won’t stop squeezing taxes out of them till the budget is balanced. Or a PM candidate informing his core constituents at a fund-raiser that he would put them and other holy cows under the tax knife after they lubricate his campaign and bring him to power because otherwise default would be a matter of months instead of (possibly) years.

You can bet that they would almost always say the exact opposite of the truth. The bunch in power would say nobody could’ve done a better job and the bunch in opposition would claim that they’d do it better and make promises they’d have no intention of keeping. And, sure enough, they’d repay the kindness of financing their campaign with the usual tax-and-subsidy shelters should they win. This way government of the people, for the people, and all that became a game of tricking and deceiving the people a long time ago; to the point that state itself is on the brink of collapse.

Right now, for example, the ruling coalition is happy to bathe in the immediate optics of the SBA (standby agreement) with the IMF as it jumps into the election, but all we know about the many pounds of flesh that the public will have to pay for it is that there will have to be ‘structural reforms’. And nobody has yet taken the trouble to explain in detail what those reforms might be, how deep they’ll bite, and how long they will go on. Because speaking the truth this close to the election can in fact amount to giving your own party the kiss of (political) death.

Yet people must know the truth. And the hard truth is that Pakistan’s debt will deliver the economy deep and traumatic shocks in the near-to-medium term, either through very awkward restructuring or, more likely, outright default. That will unleash severe inflation and unemployment and Pakistan’s people — who suffer because of the elite’s corruption in one of the modern world’s cruelest ironies — will have to live with at least a lost generation before there’s the faintest hope of any improvement.

Another hard truth is that untaxed and under-taxed sectors and mafias – like traders, wholesalers, real estate barons and feudal lords – will have to be taxed ruthlessly, otherwise there’s no chance of stability, much less rebound, even in the distant future.

That will require a government with the will and the muscle to send the taxman where none has dared before. And, democracy or no, that’s not possible when political campaigns are hostage to big money donations and parliament is housed by the big fish that swim in untaxable seas.

In theory, there’s no reason a democratic setup cannot rise to such challenges, of course, but yet another hard truth is that the godfathers and cult figures that dominate Pakistan’s politics have already exposed themselves as amateurs, while the economy needs meticulous surgeries and amputations that only top working professionals can deliver.

Given the circumstances, voting in the next election is about choosing the best person to lead the people to the slaughterhouse. Recovery, if at all, is going to be a very long process. And the kind of cuts that are now unavoidable will make it impossible for any government to go back to the people in five years, making the present electoral cycle unsustainable till things start getting better.

It’s a grave injustice to the people to peddle the narrative we might make it another year or two if the IMF program sticks and if friendly sovereigns and bi- and multi-laterals give another few billion dollars and if some of them roll over our loans just because we keep begging them to. The point has come where the usual lying for political expediency is only setting people up for a much harder eventual landing into default.

Ordinary Pakistanis have been dealt a very unfair hand. First they suffered under the corruption of their elected representatives, then they paid, quite literally, as that corruption bloated the national debt, and now they’re being forced to pay more for the stability that will not come; at least not by pretending that the threat of default will go away.

They need the kind of leadership that will tell them what’s really in store, quantify the degree of sacrifice that is needed, and then sincerely see them through the long and painful road to reforms so the next lost generation is finally the last lost generation of this Islamic republic.

The hard truth is that Pakistan needs a hard reset; in how it handles the economy and the system that runs the country.

Copyright Business Recorder, 2023


Comments are closed.

Haroon Jul 20, 2023 09:22am
Well-written. Technocratic setup is the need of the hour.
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KU Jul 20, 2023 10:20am
Very true, and everyone knows that big always beats small. Ours have never been democratic traditions, we have always suffered a colonial system after independence, and people considered it as an opportunity for their rule. It won't be wrong to say that a new generation is standing in wait at the periphery of undelivered socio-economic promises and they may take their own course to survive the rulers and times. There is some time still left to bring forth new leadership and mindset because alternatively, we see very dark times ahead.
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Nadeem A Jul 20, 2023 10:51am
Bitter truth - but this ain't going to happen!! No one, absolutely no one has the guts to TAX untaxed and under-taxed sectors and mafias – like traders, wholesalers, real estate barons and feudal lords.
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