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December 15, 2015

Opposition, not consensus, to neoliberalism


December 15, 2015

From the pedestal of a regular column on the economy, in Dawn, Mr Sakib Sherani makes the arrogant and audacious, and clearly ludicrous, claim, that “there is a near-consensus on the broad contours of neo-liberal economic policies in this country, with an emphasis on liberalisation, privatisation, de-regulation, financial deepening and fighting inflation”.

To inflict his point on his readers, he argues that this consensus has been “fostered and influenced in the main by a corpus of policymakers, advisers, analysts and media persons from the financial markets and banks (including people like myself), or from the multilateral institutions, or those associated with large corporate groups”.

Fortunately, not only is there no ‘consensus’ amongst ‘policymakers, advisers, analysts’, not to mention academics and scholars and political workers, his claim that such views have been ‘fostered and influenced’, are better translated as ‘forced upon’ us by the interests of the large corporate groups and of international financial institutions such as the World Bank, IMF and Asian Development Bank, whose ideology he seems to represent.

Importantly, it seems clear that Mr Sherani only hears and reads what people such as him and his close circle of corporates and multilaterals want to enforce upon the Pakistani public and those who represent and stand by them. Clearly the absence of any mention of people’s representatives and a host of other groups opposed to his way of thinking – academics and numerous political workers, for example – reveals which group he clearly aligns himself with.

But this should not be surprising. Like many technocrats who served and collaborated with the military government of the Musharraf-Shaukat Aziz arrangement and were party to many false promises and hopes, Mr Sherani also brazenly ignores the views of people – real people, that is, not ‘large corporate groups’ – and imagines a ‘consensus’ being thrust upon those who have legitimacy to represent them. At a time when there is visibly growing opposition to policies of privatisation, neoliberalism, and to giving in to the policies of the IMF and World Bank, he clearly reads different pages even in the newspaper to which he contributes. His is a blinkered view, serving interests that do disservice to the working people of Pakistan.

There is active opposition to neoliberalism in all its guises – privatisation, de-regulation, liberalisation, ending subsidies, and so much more – where the private sector and the market determine choices for people. The reason for this is that there is a huge consensus amongst academics and economists who matter, including Nobel Laureates, that neoliberalism is not a universally or uniformly preferred option, largely because it benefits the few – the corporate sector and upper class consumers – at the cost of a large number of common people.

Just as one example, privatisation is no panacea for fixing poor quality mismanaged government services, but better accountability and control of such services by people who can be held accountable by those who use such services is a preferred option.

The global crash of 2008 had its genesis in neoliberal greed and hubris, and if it wasn’t for state intervention the economies of the world would have gone into a huge depression, collapsing completely, which would have taken years for the invisible hand of the neoliberal free market to help stabilise. It is only government intervention rescuing private sector banks, automobile manufacturers and other industry that has allowed growth to resume within five years. Very non-neoliberal policies have rescued the world from utter collapse brought upon it through neoliberalism in the first place.

In Pakistan’s case, ample evidence, most of it rigorous academic analysis, and not just done by ‘analysts and media persons’, has shown the damaging effects of privatisation. From KESC and PTCL to other enterprises, with the possible exception of a protected and pampered banking sector, much privatisation has had negative consequences.

All over the world lay-offs, higher prices for essential services, poorer services on account of monopolies, welfare losses, falling incomes, rapidly increasing inequality, curtailment of labour unions and their rights, the rise of crony capitalism and private sector corruption, and lower tax contributions from profitable former public sector enterprises are just some of the consequences of these neoliberal policies.

Neoliberalism, under the false pretence of improving efficiency and that vague term ‘governance’, creates a new and pampered economic and political elite for whom amassing wealth and through it political power is the primary objective. Mr Sherani’s ‘large corporate groups’ are not just making super-profits in a protected environment, they have now emerged as the large media conglomerates, changing the discourse on public issues and values.

Pakistan and like it all countries that have embraced neoliberalism are prefect examples, where issues of poverty, people’s rights and communities marginalised on account of various forms of neoliberalism are seldom aired. Game shows, tamashas, and the dream to be able to afford consumer goods to make large corporate groups wealthier, is what constitutes prime time watching. With ‘large corporate groups’ determining the ability to participate in politics as well as what constitutes public opinion, real people and real issues, and working classes and their concerns are all but shut out.

It is also neoliberal policies that have, for the push for global power and profits, led to war and invasion to ensure supplies of raw materials in many parts of the world. However, it is the post-neoliberalism political agenda which brings into power the Workers Party in Brazil, Syriza in Greece, Podemos in parts of Spain, and numerous left-of-centre anti-neoliberal political parties in much of Latin America and in other developing countries.

The consensus Mr Sherani sees so clearly is limited to his corporate friends and to those who subscribe to a market fundamentalism, not one shared by most working people wherever they may be. Neoliberalism is all about the politics of domination, extraction and control. If there is a consensus, it is one of opposition to neoliberalism.

The writer is a political economist.



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