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  • Cort Greene
    http://www.marxist.com/pakistan-economic-salvation-privatisation-or-expropriation.htm Pakistan: Economic Salvation - Privatisation or
    Message 1 of 1 , Feb 21, 2013

      Pakistan: Economic Salvation - Privatisation or
      Written by Lal KhanThursday, 21 February 2013
      [image: Print]<http://www.marxist.com/pakistan-economic-salvation-privatisation-or-expropriation/print.htm>[image:

      There has been an aggressive campaign in the media that the recipe for
      growth and the solution to the economic crisis is privatisation and not the
      nationalisation of industry, agriculture, finance capital and the economy.
      Nationalisation has been dubbed as a failure and an economic disaster.

      The burgeoning losses and corruption in the PIA, WAPDA, Railways, Steel
      Mills and other state institutions have been diagnosed as the products of
      nationalisation and public ownership. For most analysts and politicians
      dominating society, the solution of these economic woes is simply the
      �privatisation� of these enterprises. Such brusque and absurd statements
      only lay bare the obtuseness and mediocrity of the experts of the elite who
      slavishly ape the western bourgeois economists who have plunged the
      economies of advanced capitalist countries into the deepest slump in memory.

      [image: postal workers protest 4
      reality is that the economic development in Europe, the USA, Japan and
      other advanced capitalist economies in the post war period was possible
      through the domination of state sectors in the economy that gave them a
      certain social advance and stability. The economic history of Pakistan also
      contradicts this approach of monetarist economics. In the 1960s under the
      Ayub regime there was a substantial expansion of industry and
      infrastructure and the main emphasis of the economic policy was not the
      present doctrine of trickle down and free market economics.

      On the contrary it was Keynesian economics that was pushing the growth rate
      and expanding the economy. Although it was the by-product of the spin off
      effects of the boom in western capitalism in that period, it was mainly
      through the intervention of the state that the economy surged forward. The
      state set up industries and dams and other infrastructure projects under
      the state institutions like the Pakistan Industrial Development Corporation
      (PIDC). Similarly, land reforms were introduced and the state invoked
      policies to expand and stimulate demand. But this model failed to carry out
      an equivalent social development which sharpened contradictions in society
      that exploded in the revolutionary upheaval of 1968-69.

      Despite defeat in a war, dismemberment of the country and massive
      destruction, the PPP government, under the influence of the mass upsurge,
      carried out some of the most radical reforms in the country�s history.
      Large chunks of the mainly domestic capital and industry were nationalised
      and massive land reforms were instituted. However, the capitalist state
      and the system were not overthrown under the utopian doctrine of a �mixed�
      economy. The reforms were sabotaged by a bureaucracy that was in cahoots
      with the landlords, capitalists and the imperialist monopolies.

      The failure of these reforms to deliver laid bare the incapacity of
      carrying out of reforms within a capitalist setup. These nationalisations
      were in fact bureaucratisation of the industries and did not introduce
      workers management, control and collective ownership. It was a regime of
      state capitalism that tried to attack some sections of the ruling class
      without eliminating their system in its totality. As soon as they recovered
      from the initial blows, this elite hyped inflation and sabotaged the
      economy resulting in severe social and political instability. In connivance
      with the imperialists and the military generals they toppled the PPP
      government and assassinated Bhutto through the gallows in a venomous
      vengeance for the bruises they got from these expropriations.

      In the 1980s, when Keynesian economics started to collapse internationally
      after the oil shock and the first major post war slump of the mid
      seventies, the new mantra was trickledown economics under the synonyms of
      Reaganomics and Thatcherism. In reality, it was the same old monetarist
      capitalism of the 1860s. The collapse of a bureaucratic caricature of
      socialism in the Soviet Union and the capitalist degeneration of the
      Chinese bureaucracy further gave impetus to this aggressive neoliberal

      However, these policies in the ex-colonial countries from Chile to Pakistan
      were a catastrophe for the teeming millions. The brutal but cowardly Zia
      dictatorship was afraid and cautious of implementing large scale
      privatisations as they were terrified of a massive workers backlash that
      could have overthrown the despotic regime. But with the advent of the
      democratic regimes of Benazir Bhutto and Nawaz Sharif the privatisation
      process was accelerated. Thatcherism became the role model. With the lull
      in the movement and the ideological betrayals of the left political and
      trade union leaders, who capitulated to Fukuyama�s theory of �the end of
      history�, the interests of the rulers were served. The disastrous impact on
      the workers and the impoverished masses was cynically ignored. Today,
      almost all of the mainstream political leaders in Pakistan subscribe to
      this doctrine of trickledown economics.

      Even in the present situation there are numerous examples which demonstrate
      the progressive impacts of expropriations for the oppressed masses. In its
      issue of 19th January this year the most ardent advocate of privatisation,
      The Economist, had this to write about the situation in Bolivia. �Since
      becoming Bolivia�s president in 2006, Evo Morales has brought ever more of
      the country�s economy into the hands of the state. In his first year in
      office he renationalised the oil industry. Telecoms, much of electricity
      generation and then zinc and tin mining followed. On December 29th Mr.
      Morales announced the expropriation of two electricity-distribution
      companies owned by Iberdrola, a Spanish company...Bolivia has overtaken its
      wealthier neighbour Peru in access to clean water, the World Bank
      reckons... average incomes have more than doubled in dollar terms...The
      government may now be able to expand electricity provision, as it has with
      water...�But to sustain this alleviation of poverty and the access of the
      basic amenities Evo Morales will have to go the whole hog and expropriate
      the commanding heights of the economy. Capitalism has to be overthrown and
      the socialist revolution completed for the emancipation of the masses in

      With the present catastrophic condition of Pakistan�s economy,
      privatisations only end up in worsening the plight of the toiling masses.
      What we can learn from the economic history of capitalism is that class
      interests are irreconcilable. For the ruling classes and their imperialist
      bosses these policies of privatisation and the intensification of
      exploitation are necessary to sustain their rates of profits. For the
      working masses it means exclusion from health, education, water,
      electricity and the other basic needs of life. But half hearted
      nationalisations within the constraints of capitalism are futile and end up
      in a disastrous economic crisis. The politics of the people�s emancipation
      need the expropriation of the banks, industry and agriculture. This can be
      only brought about by the creation and establishment of a democratically
      planned economy where all production, wealth and resources are not for the
      sake of profits but for fulfilment of human need and for putting an end to
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