MIRZA SHAHNAWAZ AGHA
IS there any one who will check his pocket for me and report if he/she did witness the changing colour of his/her money!? Has it become red, yellow, brown, black or has it been battered blue?! The green-back, bank tender like a few others is a medium of exchange and a commodity too! This is phenomenal! It is like being a male and female both in one body! This bi-versatility plus the phenomena of black money and white money has to be understood specifically from the perspective of our economies in the third world, so placed.
The medium of exchange one calls money is representative of value that has been exchanged due to any form of transactional labour. Essentially therefore it is the labour of individuals or legal entities that cause a transaction which warrants the need of a ‘medium of exchange’! This revenue being representative of value if saved is manifest as wealth and if spent brings in a cash flow for expenses. The question therefore is the discrimination between black and white money!
The labour of individuals and or entities therefore is a personal and individualistic compensation of value evidencing a sale or purchase of a tangible or a service. This value becomes black in the present manifestation when a part of the same has not been given out to a government. Individuals and entities in any political territory need to pay a portion of their wealth and or income, to avail what they seek from a govt in exchange like security, welfare, education, healthcare the like. When this appropriation is not done and disbursed, then the money so retained, held back, evaded is referred to as black money. Money again, is classified as black when a morality dimension on how it has been acquired or earned kicks in. A good example is, money misappropriated, robbed like. This is so because money obtained from such source will naturally evade tax.
Different governments have different ways for collecting this revenue to meet governmental obligations and this is always subject to audit to insure that it is rightly spent. However at both ends of the ‘giver’ and ‘taker’ the fear of piracy is fraught. This is a huge dilemma because wealth or financial generation without a productive use will inevitably bring about inflation into an economy and will restrict enterprise. Of course the solution is a free market economy with only one head for governmental revenue. That one source should be inescapable for the ‘giver’ and can then become squarely auditable for the ‘taker’. Ill meaning governments avoid this legally balanced equation and enact laws that are harsh on the ‘giver’ and almost entirely unaccountable for the ‘taker’. This is crises of economy in Pakistan.
The one head of account that has to logically therefore be taxed is land because all individuals and entities are based there-upon. Enterprise when freed from a multitude of taxable heads and subjected to a free market economy environment will without fail rise and shine. The hoarders, monopolists and cartel operators will all scum to a competitive fear that will keep the consumers adequately protected from the heist of opportunists. This does put a government to being audited and therefore accountable for their obligations. There are no two opinions on this route for free countries to adopt that are not being dictated to by the politics of global donors. It is also significant to note that the support arm for the medium of exchange that is manifest of wealth should always be a tangible.
In the Pakistan specific scenario it is incumbent that despite the water under the bridge of a rotten economic legacy all black money should get amnesty if ploughed back into a production activity. More. All of the country’s reserves must be in gold and the Pakistan Rupee must be revalued to be linked with gold in place of a basket of politically alien printed paper. Free import of gold and free export to fund the import bill must be considered as the new monetary regime for the country should we ever wish to see our necks out of the noose we so proudly adorn. Our commitment to the alien printed paper is only our tenacious guarantee to slavery and decadence. Wake up money managers because the green-back based aid is planned for a global bailout courtesy COVID-19 and that will sink us in this monetary death trap still further.
— The writer is an entrepreneur and author of the book Current Chronicles based in Karachi.
