Hassan Javid
The schadenfreude that has been on display in Pakistan this past week has truly been a sight to behold. Following an exposé by the New York Times, Axact has gone from being (in its own words) ‘the world’s leading IT company’ and ‘Pakistan’s largest software exporter’ to an entity whose illegal shenanigans are currently being investigated by a wide and diverse range of government agencies. Accused of running dozens of fake diploma mills around the world, defrauding and misleading thousands of people across the globe, tax evasion, and a manifest failure to produce any evidence in support of the notion that it does, indeed, primarily produce software, Axact remains defiant in the face of relentless criticism, arguing that the current campaign against it has been instigated by rivals attempting to undermine the launch of its BOL media organization. The company has also threatened all and sundry with legal action for spreading these accusations, going so far as to threaten Pak Tea House, an independent blog, with dire consequences for posting Tweets that made mention of the brewing scandal. All of this posturing and righteous indignation has thus far been met with a collective shrug; as each new day brings with it fresh proof of wrongdoing, it is becoming increasingly apparent that Axact has a lot of explaining to do.
Coincidentally, news of Axact’s questionable business practices broke at the same time as reports that six banks in the United States and the United Kingdom are to be fined $5.7 billion for colluding to rig foreign currency markets. This week also saw accusations that Peabody Energy, the largest privately owned coal company in the world, attempted to make use of the Ebola crisis in Africa as a means through which to more effectively market its products and services. All of this comes on the heels of various other fines, punishments, and revelations over the years that have pointed towards one core fact: all over the world, private companies and corporate actors are constantly and consistently engaging in unethical behavior in their quest for profit. Increasingly freed from the constraints of regulation, particularly in developing countries starved for foreign investment, multinational corporations, as well as their indigenous counterparts, continue to engage in rapacious behaviour that makes a mockery of claims about the economic and social good that comes from free markets. The widening gap between the rich and the poor, ongoing attacks on the rights of the working classes, and rampant environmental degradation are all testament to the destructive logic of capitalism.
Despite all of this, the mantra of being ‘pro-business’ is one that has a stranglehold over economic debate in this country, and which has been completely and totally internalized by the mainstream political parties, is one that serves little purpose other than to facilitate ever-greater accumulation by the rich and powerful. While the claims that have been made about Axact must be rigorously investigated, it should not be surprising to discover that massive corporate entities like it have more than a few skeletons in their closets. If anything, the real scandal is the way in which there is nothing even remotely resembling a systematic desire to identify and deal with corporate malfeasance at a more general level in Pakistan. Axact itself operated with impunity for the better part of twenty years, and it beggars belief to suggest that suspicions had never previously been raised about the nature of its business. In thrall to the cult of corporate ‘success’, seduced by the siren songs of economic nationalism, and forever worshipping at the altar of Mammon, the government (and many ordinary citizens) are all too ready to provide a free pass to anyone as long as they can keep the rupees flowing. In a country where the default position taken towards the political elite is one of profound distrust, and where the most minor infractions in the public sector (rightly) generate widespread opprobrium and condemnation, it would be heartening to see a similar level of scrutiny being brought to bear on the titans of industry and commerce at the heart of the economy.
The Axact scandal should also prompt us to reflect on another phenomenon, namely the endless demand for ‘degrees’ and the proliferation of avenues through which this demand is being met. Several decades ago, Ronald Dore argued that modern societies are increasingly afflicted by the ‘Diploma Disease’, whereby increased competition for jobs, and an excessive emphasis on using education as a means through which to categorize and select individuals, has led to more and more people pursuing higher education in order to perform tasks that do not necessarily require that level of specialization or training. For Dore, this has profoundly detrimental effects on society; not only does this ‘credential inflation’ lead to a situation in which excessive and arguably unnecessary emphasis is placed on the acquisition of formal educational labels, it also has the paradoxical effect of diluting the quality of the education being received, with ever-increasing numbers of students being superficially ‘serviced’ by degree programmes oriented towards providing ‘qualifications’ rather than a deeper engagement with the material being studied. Learning therefore ceases to be the main aim of education, being replaced instead by a fetishistic desire to simply acquire a piece of paper that can be used to enter the job market.
While Pakistan was apparently not the primary market in which Axact allegedly ran its fake degree business, the whole episode illustrates the fictitious basis of the modern higher education system and the job market. Individuals from around the world knowingly and unknowingly received credentials from Axact that were presumably found to be satisfactory by a wide range of employers, with this only serving to demonstrate the clear lack of a link that often exists between learning in college and the demands of the workplace. This should also provide us with some insight into a related but less illegal phenomenon, namely the proliferation of thousands of private ‘colleges’ in Pakistan catering to hundreds of thousands of students for whom gaining a degree, any degree, often at considerable expense, provides entry into a competitive job market, even if that degree does not bring with any real skills, training, or knowledge. In this context, it should not be surprising that the individuals accused of perpetrating the attacks on Sabeen Mahmud and the Ismailis in Karachi are graduates of reputable institutions; other than the fact that educational credentials do not always provide protection from economic insecurity or social alienation, it is also clear that the acquisition of a degree is not necessarily accompanied by the cultivation of a broader, more tolerant worldview.
There are obviously many professions that require specialized training, just as there are colleges and universities that do a good job of providing their students with a well-rounded education. It can also be argued that higher education and the pursuit of knowledge, when done right, can enrich individuals and society in ways that can not necessarily be quantified, and that they have an intrinsic worth that does not have to be justified by employment prospects and salaries. Nonetheless, when thinking about Axact’s travails, we would do well to give some thought to the detrimental effects of the broader economic and social changes that facilitated the growth of its particular business model.
Coincidentally, news of Axact’s questionable business practices broke at the same time as reports that six banks in the United States and the United Kingdom are to be fined $5.7 billion for colluding to rig foreign currency markets. This week also saw accusations that Peabody Energy, the largest privately owned coal company in the world, attempted to make use of the Ebola crisis in Africa as a means through which to more effectively market its products and services. All of this comes on the heels of various other fines, punishments, and revelations over the years that have pointed towards one core fact: all over the world, private companies and corporate actors are constantly and consistently engaging in unethical behavior in their quest for profit. Increasingly freed from the constraints of regulation, particularly in developing countries starved for foreign investment, multinational corporations, as well as their indigenous counterparts, continue to engage in rapacious behaviour that makes a mockery of claims about the economic and social good that comes from free markets. The widening gap between the rich and the poor, ongoing attacks on the rights of the working classes, and rampant environmental degradation are all testament to the destructive logic of capitalism.
Despite all of this, the mantra of being ‘pro-business’ is one that has a stranglehold over economic debate in this country, and which has been completely and totally internalized by the mainstream political parties, is one that serves little purpose other than to facilitate ever-greater accumulation by the rich and powerful. While the claims that have been made about Axact must be rigorously investigated, it should not be surprising to discover that massive corporate entities like it have more than a few skeletons in their closets. If anything, the real scandal is the way in which there is nothing even remotely resembling a systematic desire to identify and deal with corporate malfeasance at a more general level in Pakistan. Axact itself operated with impunity for the better part of twenty years, and it beggars belief to suggest that suspicions had never previously been raised about the nature of its business. In thrall to the cult of corporate ‘success’, seduced by the siren songs of economic nationalism, and forever worshipping at the altar of Mammon, the government (and many ordinary citizens) are all too ready to provide a free pass to anyone as long as they can keep the rupees flowing. In a country where the default position taken towards the political elite is one of profound distrust, and where the most minor infractions in the public sector (rightly) generate widespread opprobrium and condemnation, it would be heartening to see a similar level of scrutiny being brought to bear on the titans of industry and commerce at the heart of the economy.
The Axact scandal should also prompt us to reflect on another phenomenon, namely the endless demand for ‘degrees’ and the proliferation of avenues through which this demand is being met. Several decades ago, Ronald Dore argued that modern societies are increasingly afflicted by the ‘Diploma Disease’, whereby increased competition for jobs, and an excessive emphasis on using education as a means through which to categorize and select individuals, has led to more and more people pursuing higher education in order to perform tasks that do not necessarily require that level of specialization or training. For Dore, this has profoundly detrimental effects on society; not only does this ‘credential inflation’ lead to a situation in which excessive and arguably unnecessary emphasis is placed on the acquisition of formal educational labels, it also has the paradoxical effect of diluting the quality of the education being received, with ever-increasing numbers of students being superficially ‘serviced’ by degree programmes oriented towards providing ‘qualifications’ rather than a deeper engagement with the material being studied. Learning therefore ceases to be the main aim of education, being replaced instead by a fetishistic desire to simply acquire a piece of paper that can be used to enter the job market.
While Pakistan was apparently not the primary market in which Axact allegedly ran its fake degree business, the whole episode illustrates the fictitious basis of the modern higher education system and the job market. Individuals from around the world knowingly and unknowingly received credentials from Axact that were presumably found to be satisfactory by a wide range of employers, with this only serving to demonstrate the clear lack of a link that often exists between learning in college and the demands of the workplace. This should also provide us with some insight into a related but less illegal phenomenon, namely the proliferation of thousands of private ‘colleges’ in Pakistan catering to hundreds of thousands of students for whom gaining a degree, any degree, often at considerable expense, provides entry into a competitive job market, even if that degree does not bring with any real skills, training, or knowledge. In this context, it should not be surprising that the individuals accused of perpetrating the attacks on Sabeen Mahmud and the Ismailis in Karachi are graduates of reputable institutions; other than the fact that educational credentials do not always provide protection from economic insecurity or social alienation, it is also clear that the acquisition of a degree is not necessarily accompanied by the cultivation of a broader, more tolerant worldview.
There are obviously many professions that require specialized training, just as there are colleges and universities that do a good job of providing their students with a well-rounded education. It can also be argued that higher education and the pursuit of knowledge, when done right, can enrich individuals and society in ways that can not necessarily be quantified, and that they have an intrinsic worth that does not have to be justified by employment prospects and salaries. Nonetheless, when thinking about Axact’s travails, we would do well to give some thought to the detrimental effects of the broader economic and social changes that facilitated the growth of its particular business model.
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