Imran Khan the ‘economist’

Imran Khan’s (IK’s) PTI took out rallies in Lahore, Karachi and Quetta on Sunday against inflation and the state of the economy. Whereas the Lahore rally was sizeable, it was nowhere near the ‘tsunami’ the PTI had promised. The rallies in the other cities were even smaller. In his speech at the rally in Lahore, IK spelt out a nine-point ‘formula’ for righting the wrongs of the economy. IK’s ‘economics’ could be boiled down to declaring war on drone attacks and the NATO supply lines, improving law and order, eliminating corruption, avoiding dependence on IMF loans, taxing the rich, eschewing the printing of currency notes to avoid inflation, and promoting accountability and foreign investment. The implication in this delineation of a magic formula to bring economic wellbeing and prosperity was that IK’s PTI could do this job better than the elected government at the Centre. Even if, for the sake of argument, it is conceded that the PTI could do better than the incumbent PML-N, a closer examination of these nine points would show that there is nothing new in them that is not the stuff of the existing narrative on the country’s, let alone the economy’s woes. Declaring ‘war’ on drone attacks has already been carried out by the PTI through blocking the NATO supply routes in Khyber Pakhtunkhwa, the likely outcome of which will probably be the curtailing of Pakistan’s aid from the US and the west. How that will improve the economy is known only to Dr Keynes IK. As for one of the main planks of the PTI’s politics, i.e. eliminating corruption, although a desirable goal, cannot be guaranteed to make rivers of milk and honey flow. In case IK is unaware, the developed world, in which the kind of crude corruption we have is rare, corruption in government and the corporate sector and a nexus between the two is hardly new or unknown. If that corrupt nexus was the only source of the west’s and the world’s current economic woes, by now it would have been corrected. If ever there was a case of misplaced concreteness, IK’s implied view that corruption’s elimination is the magic wand for all economic ills would top the list.

IMF loans are not a luxury. Even a government like the PML-N, wedded to according the private sector the role of the engine of the economy, recognised the necessity of such loans if Pakistan was to meet its external obligations. This is bitter but necessary recognition of reality, not the pie-in-the-sky promised by IK’s uneducated take on the economy. Taxing the rich in a capitalist economy has proved difficult even in the developed world, let alone a country such as Pakistan that has known mostly the privileges, perks and state-fuelled concessions to the rich and powerful in our history. Of course the rich should be taxed, especially those hoarding hidden income and wealth. But this is too is neither easy nor quick. The IMF, whatever our view of it and its programmes, is also insisting on just such tax reforms, but the dire straits of the economy have compelled the PML-N government to offer a tax amnesty to hoarded wealth in the hope of boosting investment. The measure may or may not pay off, and will almost certainly postpone the day of reckoning for tax evaders, but no one, including IK who argues for foreign investment, has come up with a better idea so far that encourages not only external investment, but persuades our businessmen to reverse the flight of capital from Pakistan and put their money where it is needed.

Perhaps the main reason why IK has embarked on economic terra incognita is because his pro-Taliban pronouncements and policies have alienated a large section of the youth who flocked to his banner in the lead up to the 2013 elections. The fizz seems to have gone out of that youth wave, hence the resort to perceived ‘populist’ demands such as relief from inflation and other steps. But the facts are stubborn things. IK’s ‘economics’ is essentially a reductionist and superficial view that the ‘system’ can and should be run (preferably by Imran’s party) in a better, cleaner way, and that will solve all our problems. The problem with that simplistic notion is that the economic status and problems of the country require intelligent handling of the crisis we (and the world) are passing through, without indulging in flights of fantasy. In the end, capitalism has proved once again to be a system that self-produces periodic crises that are inherent in its make-up. IK has no alternative to offer to that system, except a better ‘managerial’ approach that may yield marginal benefits, but is unlikely to pull Pakistan out of the economic morass it is mired in.