http://www.dailytimes.com.pk/default.asp?page=2013\02\17\story_17-2-2013_pg3_5
Sunday, February 17, 2013
COMMENT : Economic salvation: privatisation or expropriation — Lal Khan
With the present catastrophic condition of Pakistan’s economy,
privatisation only ends up worsening the plight of the toiling masses
There has been an aggressive campaign in the media that the recipe for
growth and solution of the economic crisis is privatisation and of industry,
agriculture, finance capital and the economy. Nationalisation has been dubbed
as a failure and an economic disaster. The burgeoning losses and corruption in
PIA, WAPDA, Railways, Pakistan Steel Mills and other state institutions has
been diagnosed as the product of nationalisation and public ownership. For most
analysts and politicians dominating society, the solution of these economic
woes is simply the ‘privatisation’ of these enterprises. Such brusque and
absurd statements only lay bare the obtuseness and mediocrity of the experts of
the elite slavishly aping the western bourgeois economists who have plunged the
economies of the advanced capitalist countries into the deepest slump in memory.
The reality is that the economic development in Europe, the USA, Japan
and other advanced capitalist economies in the post-war period were through the
domination of the state sector in the economy that gave them certain social
advances and stability. The economic history of Pakistan also contradicts this
approach of monetarist economics. In the 1960s under the Ayub regime, there was
a substantial expansion of industry and infrastructure; the main emphasis of
the economic policy was not the present doctrine of trickle down and free
market economics. On the contrary, it was Keynesian economics that was pushing
the growth rate and expanding the economy. Although it was the byproduct of the
spin off effects of the boom of western capitalism in that period but it was
mainly through the intervention of the state that the economy surged forward.
The state set up industries, dams and other infrastructural projects under
state institutions like the Pakistan Industrial Development Corporation (PIDC).
Similarly, land reforms were introduced and the state invoked policies to
expand and stimulate demand. But this model failed to carry out equivalent
social development, which sharpened the contradictions in society that exploded
in the revolutionary upheaval of 1968-69.
Despite defeat in a war, dismemberment of the country and massive
destruction, the PPP government under the influence of the mass upsurge carried
out some of the most radical reforms in the country’s history. Large chunks of
the mainly domestic capital and industry were nationalised and massive land
reforms were instituted. However, the capitalist state and the system were not
overthrown under the utopian doctrine of a ‘mixed’ economy. The reforms were
sabotaged by a bureaucracy that was in cahoots with the landlords, capitalists
and the imperialist monopolies. The failure of these reforms to deliver laid
bare the incapacity of carrying out of reforms within a capitalist setup. These
nationalisations were in fact bureaucratisation of the industries and did not
introduce workers’ management, control and collective ownership. It was a
regime of state capitalism that tried to attack some sections of the ruling
class without eliminating their system in its totality. As soon as they
recovered from the initial blows, this elite class hyped up inflation and
sabotaged the economy, resulting in severe social and political instability. In
connivance with the imperialists and the military generals, they toppled the
PPP government and assassinated Zulfiqar Ali Bhutto through the gallows, in
venomous vengeance for the bruises from these expropriations.
In the 1980s when Keynesian economics started to collapse internationally
after the oil shock and the first major post-war slump of the mid-1970s, the
new mantra was trickledown economics under the synonyms of Reaganomics and
Thatcherism. In reality, it was the same old monetarist capitalism of the
1860s. The collapse of a bureaucratic caricature of socialism in the Soviet
Union and the capitalist degeneration of the Chinese system further gave
impetus to this aggressive neoliberal economics. However, these policies in the
ex-colonial countries from Chile to Pakistan were a catastrophe for the teeming
millions. The brutal but cowardly Zia dictatorship was cautious in implementing
large-scale privatisation, as they were terrified of a massive workers backlash
that could have overthrown the despotic regime. But with the advent of the
democratic regimes of Benazir Bhutto and Mian Nawaz Sharif, the privatisation
process was accelerated. Thatcherism became the role model. The lull in the
movement served the rulers. The disastrous impacts on the workers and the
impoverished masses were cynically ignored. Today almost all of the mainstream
political leaders in Pakistan subscribe to this doctrine of trickledown
economics.
Even in the present situation, there are numerous examples that
demonstrate the progressive impacts of expropriations for the oppressed masses.
In its issue of January 19 this year, the most ardent advocate of
privatisation, The Economist, had this to say about the situation in Bolivia.
“Since becoming Bolivia’s president in 2006, Evo Morales has brought ever more
of the country’s economy into the hands of the state. In his first year in
office, he renationalised the oil industry. Telecoms, much of electricity
generation and then zinc and tin mining followed. On December 29, Mr Morales
announced the expropriation of two electricity-distribution companies owned by
Iberdrola a Spanish company...Bolivia has overtaken its wealthier neighbour
Peru in access to clean water, the World Bank reckons...average incomes have
more than doubled in dollar terms...The government may now be able to expand
electricity provision, as it has with water...” But to sustain this alleviation
of poverty and the access of the basic amenities, Morales will have to go the
whole hog and expropriate the commanding heights of the economy. Capitalism has
to be overthrown and the socialist revolution completed for the emancipation of
the masses in Bolivia.
With the present catastrophic condition of Pakistan’s economy,
privatisation only ends up worsening the plight of the toiling masses. What we
can learn from the economic history of capitalism is that class interests are
irreconcilable. For the ruling classes and their imperialist bosses these
policies of privatisation and intensification of exploitation are necessary to
sustain their rates of profit. For the working masses, it means exclusion from
health, education, water, electricity and other basic needs of life. But
half-hearted nationalisations within the constraints of capitalism are futile
and end up in a disastrous economic crisis. The politics of the people’s
emancipation need expropriation of banks, industry and agriculture. This can be
only brought about by the creation and establishment of a planned economy where
all production, wealth and resources are not for the sake of profit but for
fulfilment of human needs and putting an end to deprivation.
The writer is the editor of Asian Marxist Review and International
Secretary of Pakistan Trade Union Defence Campaign. He can be reached at
[email protected]
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