| June 2, 2005 | Thursday | Rabi-us-Sani 24, 1426 |
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PTCL privatization
‘Gulag of our times’
FRANCE’S resounding rejection of the European Union’s first-ever constitution and the likelihood of a similar result in the Netherlands has plunged the 25-nation bloc into a period of gloom and uncertainty. The French vote is a definite setback for an EU struggling to upgrade its global standing and accelerate economic reforms. It has also revealed a crisis of leadership in the EU and growing public disenchantment with what many see as an elite-driven European project. EU leaders, struggling to contain the political and economic fallout from the French vote, are hoping they can keep the show on the road. Tuesday’s change of prime ministers in presidential France is one attempt at damage control. Luxembourg’s prime minister and current EU chairman Jean-Claude Juncker has said the treaty is not dead and ratification procedures in other EU states must not come to a halt. Mr Juncker is not wrong in putting a brave face on the defeat. It is true that the EU has so far thrived on brinkmanship and crisis. The bloc’s skilful policy-makers are master craftsmen of political compromises which have kept the EU on track for over five decades. But putting the EU back together again may not prove easy this time around.
There is no denying that many French men and women who voted against the treaty were clearly doing so for domestic reasons, including frustration with the policies of President Jacques Chirac. But, significantly, this is the first time that the population of a founding member of the EU, and a country which has traditionally spearheaded European integration efforts, has expressed itself so strongly against EU policies. However, the French No camp — a strange coalition of politicians from the left and the right of the French political spectrum — was not defending a common cause. The right illustrated a hankering for France’s Gaullist past, with far-right leaders using the referendum to campaign against Turkey’s entry into the EU and the surge in Chinese exports of textiles to Europe. Leaders on the left, including a splintered Socialist party, argued in favour of maintaining France’s generous “social model” while rejecting further economic reform and liberalization. Modern-day Europe where France no longer occupies EU centre stage is clearly a source of concern to many French citizens. Last year’s EU enlargement to include 10 new member states, including eight former communist nations of central and eastern Europe, has undoubtedly meant a loss of French influence in the EU. Fears that France will be flooded by cheap labour from the eastern states has also aggravated concerns about employment and the so-called ‘delocalization’ of French firms to new EU member countries where workers earn less but work longer hours.
The problem is that the crisis over the constitutional treaty is part of a larger crisis of leadership afflicting many EU member states. President Chirac is not the only leader facing public wrath. Gerhard Schroeder in Germany, Silvio Berlusconi in Italy and even, despite this month’s election victory, Tony Blair in Britain are all in trouble with their electorates. These and EU leaders have traditionally driven the bloc’s integration, and enlargement process forward, assuming that the public will automatically follow. The French referendum has shown that this is no longer the case. But if Europe is to emerge stronger from this latest setback, EU leaders will clearly have to change tack and start listening to the insecurities of their citizens.
WORKERS’ opposition to the proposed privatization of the Pakistan Telecommunication Company Ltd is not the only reason why the government should reconsider the issue. The PTCL is among the few public sector organizations that are doing well: it is a going concern, makes money and pays a hefty sum of money to the government in taxes. In the first nine months of this financial year, it posted a profit of Rs 21.3 billion in spite of substantial tariff reductions. This is unlike the situation in such white elephants as the Water and Power Development Authority and the eternally sick Karachi Electric Supply Company. The government subsidizes these inefficient entities and is justified in trying to sell them off. The PTCL is not a state liability, and for that reason its privatization needs to be justified. On a macro-economic level, will the PTCL’s privatization help the government maintain the economy’s growth rate currently claimed at 8.3 per cent? Selling an entity to a foreign party does not create new jobs; only the ownership is changed. If the new owners are foreigners, then they will obviously take their profit home. This will in no way reduce the widening balance of payments deficit.
It goes without saying that the country needs foreign direct investment in a big way. But this must go into industry, create new capacities, increase production, create new jobs and contribute to economic growth. Unfortunately, by global and regional standards, we only have a trickle in terms of FDI. Intelligent policies, greater incentives and, above all, a better law and order situation should help increase FDI and sustain growth. If the government still thinks that the PTCL needs privatization, it must then come out with reasons more cogent than those it has so far given. As for the workers, the “disappearances” we have been hearing about concerning union leaders in the PTCL headquarters are not exactly the best way of defusing the workers’ unrest. A better way would be to assure the workers that privatization will not lead to retrenchments and that their rights will be safeguarded.
PRESIDENT Bush and a large section of the US press appear incensed by the statement of the Amnesty International secretary-general that the American-run prison facilities at Guantanamo Bay are “the gulag of our times”. Mr Bush has termed the comparison as absurd while a number of US papers are of the view that the excesses committed at Guantanamo bear no resemblance to those perpetrated on prisoners sent to forced labour camps in Stalin’s Soviet Union. One cannot dismiss American feelings as being unnecessarily sensitive on a matter of semantics. It is worth recalling the anger unleashed in the Muslim world when, soon after the events of 9/11, Mr Bush referred to the struggle against terrorism as a “crusade”. Moreover, millions perished in the Siberian gulags which, for the sheer scale of physical and mental torture endured by the inmates, may have few parallels in history.
Nevertheless, Amnesty’s strongly worded condemnation reflects the growing resentment of millions across the globe at the increasingly unilateralist posture of muscle-flexing that the US has come to adopt. Guantanamo has been among the worst manifestations of this. Human rights bodies, journalists, former inmates, even servicemen, have pointed to the rampant physical and mental abuse of the prisoners who, until last year, had no way of challenging their detention in a court of law. Many were subsequently released without charge when even brutal interrogation methods failed to elicit any useful information from those who must now bear the burden of lifelong memories of physical and mental trauma. Neither the Bush administration nor the US press can afford to whitewash America’s sins by raising objections to Amnesty’s criticism. While comparisons with the hated communists might be a blow to America’s ego, the failure to recognize the deviations from the democratic principles on which the country was founded will serve to alienate it even further from the world community.