Life at the top is difficult and onerous. That is more so now that the capabilities required are so different and we still have with us the norms and abilities of the 19th century. The economic survey data base and the various ratios that are given to us by the IMF and the WB have no meaning for in the ultimate analysis what the government in the developing country does has to be such that it follows multiple objectives.
The governance factors have been so messed up by the legacies that we have received before and after partition they make for a difficult situation, both in terms of diagnosis and then for prescriptive purposes. Pakistan has an overwhelming majority of issues and problems to tackle and none can be put on the back burner.
The budget is upon us. It is not a question of having a budget go through the mill and in terms of quantitative allocations. These do not matter. The budgets have been and will be documents for deceit - say something and do something. Neither the allocations nor the seriousness of the statements are ever challenged by any one. And if they are, they are of no consequence. The Planning Commission and the Finance Ministry, not to speak of the FBR, have been using this and other data for a long time. This is now obsolete.
The West has a different position for the private corporate sector makes up for any deficiency [s] of the government. Analytics there and here differ. Here is more important for me and for us. If the analytics works out better then the system gains in exponential terms - good governance makes for a better place and for a better deal for the poor people of the developing world. Why the private sector in Pakistan will not respond is because their life has been made easy through monopoly power. The market mechanism is not in place. The recent success of market forces and the award ceremony for the corporate sector in Pakistan is merely an eyewash. Keep on patting oneself on the back and in a limited field. The market has not generated the type of competition that is required for consumer welfare and that places the corporate sector in the spat to improve constantly or face liquidation. The versatile analytical aspect that I am talking about is the conceptualisation of the system and the ability to constantly move onto newer things and newer markets.
This kind of ability is not easily acquired and seeks measures that are not even in the thought process as yet. It would make the WB and IMF redundant for then Pakistan would be able to take its own decisions - good or bad. They are in such a conceptualization that many pieces have to fit in. The tangibles have to somehow mesh in the intangibles. In a modern economy they will tell you that you need software. If you use one kind, they will tell you that it is inappropriate. The purpose of the experts is to make all kinds of queries and not to finalise anything. The economic journey cannot be a painless one. It is full of all kinds of difficulties. The many pieces that have to fit together require an exponential experience of a different kind. The modern complexity is mind-boggling and that is why one cannot have in government any senile worker on a sinecure job. Both countermand working ability and effort.
What then are the prerequisites of an analytical and versatile economy? The first and foremost requirement is that all kinds of transaction data have to be refined. At the moment, inflation cannot be countered simply because the data is missing or at best lousy. The economic players of the country, the State Bank, the economic affairs division and statistics division need a better orientation and effort to dig deeper in order to improve on the fitness of data as well as determine proxies for an intuitive effort at predictive behaviour that is the hallmark of good leadership. All decision-making in Pakistan cannot be fact-based, simply because the fact basis is questionable. One can argue that facts are as the statistical collector sees it. There is an inbuilt bias in it. The IMF and the recent negotiations are based on facts that are data-allergic. The recent economic survey results that are leaked and those that were out during the period of Shaukat Aziz and Musharraf are full of all kinds of such allergies. False figures and falsehoods are writ large in the economic survey. Such data is hardly important for future planning. In fact, anything based on such data is bound to be catastrophic. There is much to be said for the street-smart policy-maker.
The issues in developing country are such that the matter to be dealt with is not only for the immediate present, but also for the distant future. Again the matter is further compounded by the exclusion of the population, in the past, from the development process. How does one determine the future, sitting in a centralised zone? The conceptualisation that is required cannot be met by the data sets that they have. The problem is exacerbated by the seniors, who do not seem to be able to understand the requirements of our times. Versatility requires not the perfection of data but the ability to take decisions, based on intuition. The development of intuition is dependent on the experience that one gains from the real life situation. So to every decision that one takes there is an element of intuition involved. More often than not, the decisions so taken are relevant and objectively correct. They may not fulfil the procedural or the documented part of the economy, but what has the documented part of the economy given to Pakistan so far.
Where are the training grounds for versatile decision-making? The training ground is in sports or wherever there is liberal education and the professors are able to help rather than hinder the students. The idea is that people will be able to transfer their informal learning from an earlier source to a later source. Versatility in other words is from the informal sources and not from the formal sources. Formal educational sources tend to deter persons from intuitive action. That is the tragedy of the educational system. It does not help the decision-making process for it creates boundaries and puts the fear of God in any one trying to break out of the regressive system. The difference between the versatile decision-makers and the rest lies in this. In the informal economy, one sees these kind of versatile decision-makers dominate, and who care for the means and the ends and who seek to be beneficial to the economy. In a scientific experiment carried out by the civil aviation it was found that those that did not rely on the computerised programme on climate were correct on the weather more often than those that did rely on the computerised programming. Time and again, the quantitative system has been at variance with the qualitative system. The science of the West seems to have lost out when the systems undergo drastic changes and so frequently. The science part is in jeopardy and it has now become an art.
Talking of inflation, as we did before, the formal inflation rate has a data bias in it? Or does it? Whichever way one considers it what is the optimal inflation rate that an economy can take? Again what are the components of the inflation rate that have to be computed before the economy understands the optimal rate? Should asset inflation be taken into account? And why not? Why should Bahria and DHA have no loadshedding? Why should the State Bank not take action against the inflation-creators and that means the oil companies. I challenge any one to justify the cost factors of setting up these gas pumps? Does Total gas stations constitute foreign investment or foreign vested interests and exploitative service? The basis dear State Bank is different? Wake up to realities.