Politics and economy

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RIZWAN GHANI

RUMORS are rife in Islamabad that change in economic team is in the offing. If so, then changes should be made to revive and improve the economy. UK PM Johnson within days has replaced Sajid Javid with Rishi Sunak as UK Chancellor of the Exchequer to deliver his new huge spending based economic plans. Since Javid was pro-austerity he had to go for the smooth working of the government. The Pound Sterling has risen on the appointment of the new UK chancellor which shows that era of spending is welcome. Johnson plans to inject more money under his “Levelling up” plan to help end economic inequality between rich and poor across the country and then use economic revival to permanently keep Labour voters with the Party who changed sides hoping for better living standards. Due to austerity policies, poor in the UK are facing extreme poverty, unemployment, homelessness, high crime rate, drug abuses, gangs, and poor healthcare system. Then privatization has resulted in higher utility bills, transport costs and outdated communication system. In addition, tax havens, lower taxes for rich, concentration of wealth, undermining of judiciary has resulted in unequal and unjust society. Experts believe that Johnson’s spending plans will not work because Conservatives are continuing with Thatcher’s capitalism, privatization, lower taxes, nationalism (Brexit), and anti-climate policies (ignoring adoption of alternate energy). Along with weakening judiciary and its powers of judicial review under proposed judicial reforms after courts called prorogation of parliament unlawful and allowed challenge to Article 50, and gag media (BBC license issue and Johnson threatened to withdraw BBC license for independent reporting during last election). After the 2008 financial crisis, the systematic manipulation of checks and balances in favor of ruling elite is destroying country’s economy, workers, poor and the unity of the country itself. The new policy is at best a diversion to hide fallouts of Brexit. Roughly, postBrexit UK is set to lose £200bn annually in trade with the EU. Tory government has persistently refused to give financial cost of its Brexit decision. Since EU has said that UK cannot be given same trade deal as its member states and big trade deals are yet to materialize so Johnson’s promises are as reliable as his credibility. In UK, the £100bn HS2 high-speed rail line has become controversial because Johnson held preliminary discussions to outsource the project even though the State owned railway builder claimed that it could complete rail link faster and more cheaply. UK has been building railways across the world since early 1900s, but now its leaders are outsourcing mega projects.Washington DC metrotrain was also outsourced. It only shows that privatization, greed and politicized judiciaries have hollowed national infrastructures and letting politicians outsource billions of dollars projects and allied jobs at the cost of national interests. The very unity of the UK is under strain as Scotland and Ireland weigh their choices to stay in the Union or join the EU. The creation of physical border with the EU will slowdown the trade and make Good Friday Agreement vulnerable. The promises to keep the border open has been changed. The fight with EU on fishing quotas and other big issues could produce negative results for the UK economy. EU has already said that Cayman Islands will be placed on tax haven blacklist within weeks of Brexit. The EU blacklist is an attempt to clamp down on the estimated £506bn lost to aggressive tax avoidance every year. Johnson has not blacklisted tax havens to stop stealing of tax money. Pakistani leaders will continue to make deals but will not call for ban on tax havens. FATF has failed to stop money-laundering issue in world’s top economies and so has the UN anti-corruption watchdog in stealing of public funds by the powerful with the help of corrupt financial sector worldwide. The critical takeaways from the UK situations based on 30 years of past policies are that had the government worked itself, it would have saved £30bn annually. It also shows that privatization has failed to provide quality healthcare, lengthened patient waiting periods, deaths due to negligence, and lack of accountability. Cutting healthcare costs (NHS UK), bringing down utility prices, improving services and protecting consumers from predatory billing, contracts, building more setups of healthcare, education, training, and upgrading to modern technology. Similarly, the outsourcing (mega projects, foreign investors and direct foreigninvestment) has failedto achieve desired results in terms of jobs, growth and better living standards. Privatization has resulted in increased costs, contributed to unemployment, erosion of local industries, manufacturing sector, research and development which in turn has destroyed the entire ecosystem that supported national economy, industry, exports and jobs. Imports or wallmartization of economy has decimated neighbourhood production units rendering millions unemployed and forced to end up on social safety networks’ costing billions to taxpayers. The resultant loss of jobs, production, poor economies and public are forced to monetary programs, local and global mafias and cartels. In terms of UK climate and green energy policy, failure to adopt clean energy has left UK with £20bn annual spending until 2030 to shift to clean energy. Google is using 2.7GW of electricity and it is carbon neutral since 2017. Google is buying 1.6GW clean electricity (equivalent of one million solar rooftops). Plans are in hand in the UK to become carbon neutral economy. Pakistan should also use natural resources to generate clean energy to make its business affordable and cut cost of living as part of Social Development Goals. Finally, UK has shown that government should own, build and run the country if it wants to create jobs, have strong economy, independence and stay united. If our graduates cannot build railway lines, engines, coaches, electric vehicles, wind turbines, solar panels, mobile technology, 5G and allied infrastructure and provide quality healthcare, then something is seriously wrong with us. And if our professionals can do it, then it is failure and greed of our government and for that no one but our judiciary and judges are responsible. It is therefore hoped that we will learn from others to make Pakistan work again from within as no one from outside will help us. They are there to eat the only piece of bread that we have. —The writer is senior political analyst based in Islamabad.