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The case against privatisation.

The basic ethos of Pakistan society and the economy are irrelevant to the schemes of privatization. Privatization is all-right in the United States of America with plentiful resources and a disposition conducive to privatization right from the beginning. In a country of scare resources, privatization will divide the nation, will be a source of countless irritants, and the mal-adjustments in different sectors arising therefrom will be of such magnitude that no government would be able to handle them effectively. Here the concepts of "self-reliance" and "self-employment" do not work. With the launching of privatization on a large scale, as is being done now, the very basis of Pakistan's existence and the very foundations of Pakistan's economy are likely to be threatened.

A consensus seems to have emerged at the national level that the present move toward privatization will do more harm than good the Pakistan society. Quite-a-few patriots and most of those interested in the development of Pakistan are protesting against the baleful results of privatization in the form of continuing rising prices, persistent inflationary trends, sustained unemployment, growing inequality of wealth, and declining incentives to technological innovations and creative thinking. The sufferers are the people of Pakistan. Privatization move is conducive to the curtailment of human freedoms and increases human deprivations. The popular opinion supports the viewpoint of having a very limited privatization as opposed to the policy of making strides, with great impatience, which is causing great havoc, resentment, and disturbance, and is indicative of the impending disaster. It is viewed basically as a bureaucratic intrigue against the people of Pakistan and is meant to divide the people. The current steps at privatization offer little prospect of socially desirable results. This is evidenced by the skepticism reflected in the opinions of a majority of participants who attended the international conference on privatization held at the Pakistan Administrative Staff College in May 1991.

Privatized banks and industries have started amassing unprecedented power to exploit poverty stricken masses of Pakistan. It is seen to be a game of millionaires and factory owners. The primary aim of this spill binding effort is alleged to be advertising by the Privatization Commission. Reform-oriented critics point to the startling statistics of expenditures on this account. Not only does the present practice promote fraudulent sales tactics and obscures real product differences, privatization further serves to turn faster the treadmill of ecologically disastrous enrichment of millionaires and industrial magnates by feeding the desire of capitalist of materialistic and hedonistic indulgence. Those to whom public establishments are sold in turn sell envy, fear, and damaging excitement, all for the sake of producer profits. Privatized concerns can be portrayed as no more accountable internally to the wishes of those who own them than to external market pressures. The logic behind privatization is such that ownership and control have become detached from people's weal and welfare. On the one hand, few capitalists are exercising exceptional privileges of influence and, on the other, most of them are concerned primarily with maximizing monetary returns. They are least bothered about the social or moral significance of corporate action. Furthermore, criticisms are very much in sigh that the privatization exercise are futile because management monopolizes all the reigns of power. Specifically privatized organization possesses near total control over money, information, personnel, and rulesin which the employees have no say. Privatization is nothing but the grabbing of vast social power for the sole purpose of private profit to the great detriment of the interests of the common man. The greatest danger in the acceleration of privatization activity lies in the increased capacity to influence the political process. It amounts to the "capture" of political authority. The image of "capture" provides the ubiquitous metaphor invoked to describe the corporate pre-emption of government authority. So much of government resource is allocated and so much is wasted in the process of privatization that Islamabad can be fairly described as a bustling bazaar of privatization accounts without which the possibility of financial collapse can not be rules out.

The process of privatization is cited as working in several ways to under-cut the value of elections as tools for promoting official accountability to the public. It is very difficult for the big capitalists to appreciate that money is the source of all political evil. It is, however, distressing to find that the key to political power in the Special Interest State is money. By lavish contributions on candidates, well heeled special interest groups have come to exercise decisive leverage over the outcome of elections. Money buys vote, more more buys more votes. Campaign financing is only the most obvious dimension of subversion of electoral control by means of privatization. Lobbying expenditures that have grown to unprecedented proportions are meant to be met by the sale of public concerns. To such strategies are being added political influence to enhance the cause of iron bar industry. With finely calculated precision,, "the message goes out from an Islamabad office or hidden lobbying group to mobilize the grassroots of the "businessworld." Such tactics which constitute an essential ingredient of privatization are likely to defeat the interests of the opposition political parties. Thus, through the process of privatization, the very public interest in Pakistan can be bought and sold. Elections can thus be converted into a "sham" and may be rendered a "political illusion". Where members of National and Provincial legislatures could be bough by the highest bidders, and the bidders in the privatized settings are likely to be owners of huge industrial concerns, the periodic checks on government in the shape of elections would become little more than rituals.

The capture of state owned established by private parties could enable the parties to freely exercise abusive and dangerous monopoly power. The privatization programmes launched by the government usually result in collusion between the ruling elite and the owners of privatized firms through informal favours and contacts, formal industrial advisory committees, routine personnel exchange, direct lobbying persistent pressures in hiring decisions.

Such incestuous relationship between industry and government can prevent democratic pluralism from taking roots in the society. Many important interests are left without a voice in the political process. It becomes very difficult to organize the people. Support for diffuse public interests is less mobilizable than support for specific private interests of small constituencies like businesses.

Moreover, with the institutionalization of privatization, most citizen groups are denied access to government agencies. The access is available to business interests only. The free market is rigged, as elections are sometimes rigged, to allow unfettered control of capitalists. With the consolidation of privatization, the entire government machinery thrives on exclusiveness and secrecy. The bureaucratic approach is buttressed by penal action for which Special Courts may be constituted with the objective of victimizing the opponents. The notion of an open government becomes a myth. The big winners in the game of privatization are wealthy groups skilled in the art of political manipulation. The prevalence of double standards becomes a common mode of operation. For instance, the authorities in Pakistan announced their so-called intention to lift ban on recruitment. Concurrently, committees were constituted to draft rules thereby delaying the real action. In a privatized administration, the success of the government depends on the extent to which it can befool the people and deceive the masses. It becomes basically an exercise in misrepresentation. The administration in such a set up wears two faces: one for appearances before the public and the other, which is poles apart, for internal management. Black laws are sometimes promulgated to protect irregular exercise of public power from public scrutiny. Thus privatization tends to have devasting consequences for the nation.

In order to protect the interests of buyers of privatized entitles, the bureaucracy is advised to delay action particularly if early action is demanded by the people. In such a situation, the bureaucracy decides what portions of relevant law to enforce or not to enforce. The bureaucracy would even adamantly refuse to carry out legal obligations. The privatized units sometimes pursue their activities "beyond the law, above the law, and even against the law", if they are advised to that effect by their owners. Thus privatization becomes instrumental in creating national emergencies. Democracy disintegrates and the political system becomes charges with hypocrisy to such an extent that at particular hypocrite may be inclined to label all his opponents as hypocrite.

It has rightly been observed that "privatization" is essentially a Western idea. Its transplantation in Pakistan where the climate is different and the topography is different is best with many hazards and great difficulties. The basic ethos of Pakistan society and economy are irrelevant to the schemes of privatization. Privatization is all-right in the United States of America with plentiful resources and a disposition conducive to privatization right from the beginning. In a country of scarce resources, privatization will divide the nation, will be a source of countless irritants, and the mal-adjustments in different sectors arising therefrom will be of such magnitude that no government would be able to handle them effectively. Here the concepts of "self-reliance" and "self-employment" do not work. With the launching of privatization on a large scale, as is being done now, the very basis of Pakistan's existence and the very foundations of Pakistan's economy are likely to be threatened.
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Author:Haider, S.M.
Publication:Economic Review
Date:Oct 1, 1991
Words:1549
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