The poverty of opportunity

POVERTY reduction is increasingly being recognised in Pakistan as one of the most important tools to gauge the performance of the government particularly with respect to its socio-economic policies.

This is indeed a welcome departure from the traditional approach, the primary emphasis of which was on increasing the GDP with little emphasis on the distributional aspects particularly that related to the impact of growth on poverty reduction. It is now being increasingly recognised that economic growth is of little use if it does not elevate the status of the majority of people who are trapped in the vicious circle of poverty.

The measurement of poverty and its comparison over time has therefore been of central concern, to the policy makers, international donors, civil society and the general public. The present government has claimed that poverty as measured by the percentage of the population below the national poverty line has been reduced from 34 percent in 2001 to 23 per cent in 2005.

The credibility of this estimate however is marred by the widespread controversy surrounding the methodology that is used to compute this rate. Dr Akmal Hussain (Dawn, Feb 20, 2008) drew our attention to methodological flaws in the recent measurement of poverty by the government. The controversy surrounding the measurement of poverty is further strengthened by the general perception of the public who fail to relate this official claim to their own standard of living that is deteriorating day by day under the escalating prices of basic necessities.

In view of the methodological flaws and constraints in the accurate measurement of poverty, there is a dire need to supplement the standard measure of poverty that is based on income and consumption with a wider concept of poverty that includes in addition to income, some other vital aspects of human deprivation. This is important for at least three reasons.

First, household data on income and consumption is much more susceptible to measurement error associated with under reporting of income and consumption.

Second, frequent changes in survey design and methodology to compute poverty rates restricts its comparability over time. Third and most importantly, there is a need to understand the concept of poverty in a much wider perspective. It is important to realise that income is an important but only one dimension of poverty.

In reality, poverty is a multidimensional concept that goes beyond the deprivation of income and consumption and includes several other forms of deprivation that people face on a day to day basis such as the denial of quality education; better nutrition and health services; security against crime and violence; satisfying leisure hours; and political and cultural freedoms to mention a few.

Of course, this is not to deny that with a sufficiently high income a person is able to improve some of his non-income attributes. But income cannot buy everything and therefore poverty ought to be viewed in a multidimensional manner.

In broader terms, poverty is the denial of opportunities: the opportunity to earn a decent living, the opportunity to have access to good quality education, and the opportunity to have access to basic health care and so on. It is important to note that it is the inequality in opportunity that is deemed more unfair than the inequality in income.

This is because some inequality in income is tolerated as it reflects differences in natural abilities and personal efforts. Inequality in opportunities, on the other hand, is much less tolerable as it denies the basic human right of the people to exercise their potential.

In order to address some of the shortcomings of the unidimensional approach of measuring poverty that is based on income alone, Mahbub ul Haq suggested a new measure which is much more comprehensive, called the poverty of opportunity index (POPI) in the Report on Human Development in South Asia 1998.

This is a composite measure that includes in addition to income poverty some other non-income but tangible indicators of human deprivation such as the lack of access to education and health. In terms of education, POPI includes the percentage of primary school age children who are out of school and the percentage of adult illiterates. In terms of health, the index uses percentage of people not expected to survive to the age of forty; the percentage of people who are deprived of access to safe water and the percentage of malnourished children under the age of five.

The Mahbub ul Haq Human Development Centre computed this index for a total of 46 developing countries and reported the estimates in its 2006 Report Poverty in South Asia: Challenges and Responses.

In the case of Pakistan, the estimate of the poverty of opportunity index turns out to be 34 per cent which is much higher than World Bank estimate of percentage of population below $1 a day (17 per cent) as well as the government figure that is based on national poverty line (23 per cent). This discrepancy between income poverty and the poverty of opportunity index turns out to be much higher in the case of Pakistan than other developing countries.

In India for instance, the estimates of POPI and those based on $1 a day are quite close: 31.3 and 34.7 per cent respectively. This indicates that in Pakistan, either the estimate of income poverty is not accurate or an incredibly higher number of people are denied opportunities than are denied income alone. In both cases, there is an underlying message for the government.

While the government celebrates rising economic growth and claims significant reduction in poverty, it is important not to lose sight of the rising deprivation in the area of health and education. The recent Education for All Report indicates that Pakistan has the dubious distinction of containing one of the highest numbers of out-of-school children in the world. In the area of health, maternal mortality rate has increased from 200 in 1995 to 320 per 100,000 in 2005. The percentage of births attended by skilled health personnel in Pakistan remain one of the lowest in the world (23 per cent), even lower than that in Sub Saharan Africa (46 per cent).

It is time that the government, instead of presenting selective indicators of well being — the computation of many of which are based on flawed and controversial methodologies — takes stock of the comprehensive picture of wellbeing of the people and reviews its policies accordingly.

Since a new government will soon be taking charge, it is worthwhile to evaluate the policies of the previous government and make an objective assessment of where they went wrong. One thing is clear and the recent election results have made it much clearer: no matter how dumb and uneducated our masses are, it is almost impossible to fool them with selective presentation of facts that do not relate to the ground realities and to the lives of the ordinary people.

The writer is the Director of Mahbub ul Haq Human Development Centre in Islamabad.

Between hope and peril

IT seems that the historic third transition from military to democratic rule in Pakistan has already hit choppy waters. The demand for restoration of the pre-Nov 3 judges, and the open threats to oust President Musharraf make this a perilous moment.

Both actions threaten to embroil the new government in a confrontation with the Presidency that can potentially undo all that has been achieved by the elections.

To understand the gravity of this moment think back to two instances from our recent past when exactly such a confrontation took place. The first was in 1993, when the Supreme Court restored the assemblies of Nawaz Sharif after they had been dissolved by President Ghulam Ishaq Khan. And the second was in 1997, when the party of Nawaz Sharif had been swept into the National Assembly with a two thirds majority after an unexpectedly strong showing at the polls.

In both instances Sharif used his renewed mandate to launch a confrontation with the other pillars of state. In 1993, he invested his renewed mandate in a protracted and ruinous confrontation in an effort to oust President Ghulam Ishaq Khan. In 1997, he launched an even broader confrontation against the combined powers of the Presidency and the Supreme Court.

In both instances he prevailed. Ghulam Ishaq Khan’s long career in public service ended in 1993, while both Farooq Leghari and Justice Sajjad Ali Shah were ousted in 1997. And in both instances, it should fairly be said, the actions of Nawaz Sharif were broadly in line with the public’s mood. In 1993 most people agreed that Ishaq Khan could no longer be trusted to wield the powers contained in Article 58 2(b). And in 1997 most people agreed that the offending article ought to be removed from the Constitution altogether, even if they did not agree that Sajjad Ali Shah ought to be forced off the bench, least of all in the manner that he was.

But in both instances the confrontation produced some of the ugliest scenes ever witnessed in Pakistan’s political history and hardly advanced the cause of democracy and rule of law. How many of us remember this headline from the 1993 confrontation: ‘Punjab Assemblies Restored, Dissolved Again 7 Minutes Later?’ And who amongst us needs help recalling the divided Supreme Court in 1997, where Article 58-2(b) was restored by one bench and struck down by a rival bench within minutes? And of course, that sordid episode where the Supreme Court was stormed by PML mobs?

Regardless of the moral clarity of both efforts, the political costs of the confrontation ought to be a sobering reminder to us of how such affairs typically play out, and how little they actually end up accomplishing.

In 1993, both parties to the dispute fought each other to a stalemate, prompting an intervention by the armed forces that has no precedent in Pakistan’s history. Both parties had to resign from office, a new interim government was established and fresh elections held. The clock had to be reset back to 1988.

In 1997 on the other hand, the confrontation turned into a never ending quagmire after the presidency and the Supreme Court had been vanquished. With a firm grip on all pillars of civilian government, Nawaz Sharif was driven into an endless series of standoffs with every other power broker in the country, lurching from one confrontation to the next, from the press to the provincial governments, and finally to the military.

In both instances, the confrontation saw the political government of its time ousted from power and the nation heaving a sigh of relief. The interim government of Moeen Qureshi is typically remembered as a watershed moment in the 1990s. And by the time the curtain dropped on the second such series of confrontations, Sharif was ousted in a coup and not a soul turned up on the streets to protest the end of the ‘decade of democracy’.

Fast forward to 2008. Once again Sharif’s party returns to the Assemblies with an unexpectedly strong showing at the polls. Once again he vows to invest this mandate in a confrontation with the presidency, in which the status quo judiciary is sure to side against the venture. And once again, it is a sure bet that the confrontation, should it come to pass, will consume the mandate handed to the parties by the electorate, and with it, all hope of a calmer future that the moment carries.

The forces driving us towards such a confrontation today claim they wish to right the wrongs of the previous government. Now if we were to draw up a list of all these wrongs and rank order them in terms of priority, the actions flowing from the Nov 3 ‘emergency’ would undoubtedly be near the top. But let’s please understand that they are not the only — not even the largest — of the wrongs committed by the previous government that need to be righted urgently.

By far the biggest wrong that needs to be righted is how the poor have been left behind by the growth rates of the past five years. Consider the numbers, for instance, that show the rural poor getting negligible shares of the rising incomes from the high growth rates created by the consumption-led boom that makes up the bedrock of the previous government’s legacy. But if you don’t have a flavour for numbers, just take a look at the lines outside the utility stores, and remember that food shortages in an agrarian economy is a crime least tolerated by the colonial government of British India.

And remember also that the government is currently living on borrowed money. The incoming government has to deal with the fast approaching end of the fiscal year which, if it closes in deficit, means another round of inflation next year. Remember also that inflows of capital have slowed to a trickle in the first half of this fiscal year.

These are some of the immediate challenges facing the incoming government. Besides this, there is the need to finance a growing trade deficit at a time when recession and credit contraction are stalking international capital markets, growing energy deficits exacerbated by record high oil prices, power outages, unemployment, stagnating exports and plummeting business confidence.

How long does this list need to get before we realise that a ruinous confrontation between parliament and the presidency might make a lot of moral sense, but might not be the most politically prudent path to take just yet? To tackle the challenges before it, the ship of state must be resting on an even keel, not embroiled in a damaging confrontation that leaves governance paralysed.

Of course in an ideal world, the president would realise that his time has long passed and would voluntarily spare the new parliament this awful choice, which itself is testament to his years of misrule. But in the real world in which we live, it is vital to realise that politics, unlike jurisprudence, is not about drawing final verdicts but the delicate art of balancing divergent priorities.

The writer is head of business and economic policy programming at

khurram.husain@gmail.com

US Muslims in politics By Jehangir Khattak

AMERICA could have elected its first Muslim Congressman as far back as 1898 if Mohammed Alexander Russel Webb had not deferred his run in favour of another fellow Democrat, William Hughes, for a New Jersey seat.

Russel, a former journalist, embraced Islam in 1888 during his service tenure as US Consul General in the Philippines. He was amongst the Muslim pioneers who started the Daawah in the US in the late 18th century.

Very few amongst America’s seven million Muslims admire this great American journalist, diplomat, and entrepreneur who dedicated the latter part of his life to the spread of Islam in this part of the world. Russel, who remained Honorary Consul General of the Ottomon Empire in New York in 1901, was also amongst the pioneering Muslim politicians who set a personal example for his co-religionists to shun their lax attitude towards mainstream American politics.

Like many Muslims, Russel did not escape the fire of a hostile media. He was subject of New York Times front-page headlines in 1893 after he established American Mission and Muslim World Press in Manhattan, New York City. However, the media’s pointed criticism did not deter Russel from doing his pioneering work.

One hundred and ten years after Russel refused the Democratic Party’s ticket to the US Congress, America’s fledgling Muslim population is once again at a crossroads. Unlike Russel, Muslims today cannot afford to miss yet another opportunity to enlist themselves as political players and not just spectators. Their increasing population and influence are bringing along monetary dividends but few political payoffs.

The US Congress today does have the country’s first Muslim member. Keith Ellison won a closely watched Minneapolis, Minnesota, election in 2006 on a Democratic Party ticket and became the country’s first Muslim Congressman. But Muslims seem less inclined to increase their tally in the US legislature. Individual efforts like Keith Ellison’s could still bear fruit as has so far been the norm.

Many critics of American Muslims say their leadership has failed to capitalise on their position. This criticism doesn’t seem misplaced as a single-member representation of seven million Muslims in the US Congress is no match to other communities.

Six million plus American Jews have 43 members in the Congress. Thirteen members of the US Senate are Jewish (two Republicans, nine Democrats, two Independents) while 30 are members of the US House of Representatives (one Republican and 29 Democrats).

Muslims are hard to find in state legislatures as well. Even Indian Americans, whose population is well over two million, have a governor (Boby Jindal of Louisiana).

The presence of anti-Muslim biases and prejudices, especially after the 9/11 terrorist attacks, cannot be discounted nor can the melancholy that engulfed the community in the face of a backlash. But there is little evidence either to suggest that Muslims are being discouraged or shunted out of mainstream politics by the state or the major political parties. Instead, lethargy, indifference, and a tendency to be self-centered and focused on their respective communities — all seems to have added to their political weakness. They are too enmeshed in community politics of different colours and shades. Their voice as a united effort is rarely heard, barring the annual conventions of big groups like Islamic Circle of North America (ICNA) and Islamic Society of North America (ISNA).

Traditionally, American Muslims have been making half-hearted attempts to make their presence felt on the political scene. Their numerical strength in states such as New York, Michigan, California, Texas, and Illinois has failed to translate into any meaningful political gains. Muslims seem far from being organised enough to appeal to the mainstream political parties for serious business.

They adopted a proactive approach in the 2000 presidential election when several major Muslim organisations made two basic decisions – called on the Muslims to vote en bloc and endorsed George W Bush.

In 2004 again, the Muslim leadership lobbied within communities across the country for an en bloc Muslim vote. However, divisions and inefficient organisation failed them again and kept them political have-nots and less visible.

They also established American Muslim Task Force for Civil Rights and Election 2004, an umbrella organisation of ten major groups. That strategy got limited media attention but hardly left any imprint on the election itself.

Now that America’s next presidential election is just ten months away, Muslim organisations are hardly geared for Decision 2008. With a few exceptions, such as Council on American Islamic Relations (CAIR), none are seen well positioned to put Muslims on a political trajectory that could lend them voice in America’s decision-making.

CAIR, an advocacy group, deserves credit for showing consistency in public advocacy and political tutoring. Its strategy of frequently releasing opinion polls about American Muslim voters is also very successful and getting wide media attention. However, leadership remains the Muslims’ weakest plank. So far, American Muslims hardly have any national, political leadership that can truly claim a following across community lines. Thus, lack of leadership and effective organisation, both weaknesses of their own making, are denying American Muslims their rightful place on the country’s diverse political landscape.

This negative tendency is afflicting Muslims from national to community level. Amongst Pakistanis, for example, upstart and self-proclaimed community leaders seem to be more obsessed with politics in Pakistan than in their adopted country. Little wonder, while Pakistani satellite channels flash advertisements from community groups demanding representation for Pakistani Americans in the parliament in Islamabad, none finds it necessary to urge the community to go out, vote and be counted in America. Pakistani Americans, thus, are as weak and divided as the Muslims at large. The joke after Saghir Tahir’s election to the New Hampshire State Assembly in 2000 still reverberates and reflects on the dark side of a divided community. The joke about Saghir ‘Saggy’ Tahir goes like this: “Saggy won the election because there was no Pakistani in his constituency.”

But seriously, America needs many more ‘Saggies’ for only they seem to be the lone hope of American Muslims who are still trying to be counted. It is not important that they will succeed or not. What is important is their effort. Theodore Roosevelt aptly describes this passion in these words: “It’s hard to fail but it is worse never to have tried to succeed.”

The writer is a US based journalist.

mjehangir@aol.com

What’s joy got to do with it?

EDGAR Morin had the surprise of a lifetime when he received an invitation from the Elysée palace for a 40-minute encounter with President Nicolas Sarkozy on Jan 7 this year. The 87-year-old Leftist intellectual, admired by the late President François Mitterrand but also by Italy’s Romano Prodi and Spain’s José Luis Zapatero, is known for his work Politics of Civilisation in which he pleads for a moral motivation while managing the affairs of this world.

The very next day Sarkozy announced he was asking two eminent economists, Joseph Stiglitz of the US and Amartya Sen of India, to evaluate the extent to which the concept of joy and happiness can be packed into the idea of economic growth in order to elaborate, you guessed it, the politics of civilisation.

Le Monde lost no time in accusing the president of having ‘pirated’ Edgar Morin and his ideas. Sarkozy was also blamed for ‘kidnapping’ Mitterrand’s adviser, Jacques Attali, who was asked by the president to prepare a report on specific measures to spur economic activity. Sarkozy’s concern, here too, was an effort to bring some sunshine into French homes.

What have joy and happiness got to do with economic growth anyway? Do people become happy just by reading in a newspaper that their country’s growth rate has hit the three, four, five or six per cent mark? Does the level of the pleasure they derive from the perusal of happy tidings in the press correspond with anything tangible? Do people really believe in economy? Do they trust their governments and each other? Or is it all an esoteric game that everyone loves to play but only a few understand?

“We must quite simply change the way we measure growth,” says Nicolas Sarkozy, refusing to answer the kidnapping charge and adding that the joy of living needs to be quantified when one is talking about economic growth.

To accomplish this Herculean task Stiglitz, who won the Nobel Prize in 2001 and is an outspoken critic of the World Bank and the International Monetary Fund, is heading a committee of experts while Sen (Nobel Prize in 1998) provides advice.

Voters of course are not economists, not all of them in any case; but a few issues have preoccupied most of them in France, and Sarkozy who won the presidential race in May last year, has not turned a deaf ear to their concern. Unemployment has fallen over for the past few years and the growth rate, at a comfortable two per cent, is not making anyone lose sleep. But then the French are also immensely chagrined by their constantly declining buying power since the conversion to the euro in 2002.

While commodities prices have risen six times in as many years, the average worker earns a take-home salary, after social security and tax deductions, of about 2,000 euros a month, i.e., the same as in 2002 in terms of purchasing power. Understandably, no amount of good news about rising GDP can bring smiles to a French wage-earner’s family if the buying power doesn’t improve simultaneously. Hence the raison d’être of this committee and Sarkozy’s seeking help from the two Nobel laureates.

However, the French president is hardly the inventor of this theory. Economists have shown growing interest of late in the inclusion and measurement of the ‘joy factor’ in living standards. The University of Cambridge recently carried out a two-year research in 15 European Union member countries questioning 20,000 people.

The head of the project, Dr Luisa Corrado, says the most important factors influencing happiness appear to be the quality of interaction between people and the confidence they have in their social institutions. The citizens of a country scoring the highest marks for happiness are also the ones who have the highest levels of trust in their governments, their laws and in each other. France trails poorly behind as number 11 on this list!

In the eyes of Joseph Stiglitz people’s trust in their institutions, and in each other, is closely linked with transparency in matters economic. Lack of trust will lead to incomplete markets which in their turn will lead to unhappiness, however hectic their functioning.

This said, the GDP growth figures can also mask a sharp decline in the quality of life of the citizens of an otherwise fully developed democracy. “This is particularly true of the US,” says Stiglitz, “where the GDP has constantly been going up but most people today feel worse off.”

Other experts have voiced similar concerns. Paul de Grauwe, professor of economics at Leuven University in Belgium, asks whether America’s success over the past 25 years has really led to its citizens being happier. Richard Layard of the London School of Economics who is also the author of Happiness: Lessons from a New Science is even more specific: “People don’t want to think they live in a world of ruthless competition where everyone is against everyone. Values such as community sense and solidarity are being lost.”

Layard’s book also shows that depression, alcoholism and crime have risen in the last 50 years in the developed world even as average income has more than doubled.

The Shantiniketan-born Amartya Kumar Sen, on the other hand, is known as the inventor of the Human Development Index (HDI), a yearly welfare indicator that takes into account poverty, education, health and quality of life while evaluating the wealth of nations and helps international policy decisions by the United Nations. He has also widely written on women’s role in a society.

Amartya Sen believes people’s happiness cannot be measured in terms of their earnings alone and that the environment they live in should never be ignored. Being illiterate in a village where everyone else is illiterate is not as much the end of the world as it would be in a different environment. His detractors call Sen the ‘Mother Teresa of economics’ and deride him for what they qualify as his ‘simplistic solutions”. Undaunted, Sen insists ethics should be as much part of economics as statistics.

Joseph Stiglitz only agreed to accept Nicolas Sarkozy’s offer after assurances that the panel will have complete freedom and independence in its investigations. There is no determined timeframe, but he hopes to have his conclusions on the French president’s desk by January 2010.

The writer is a journalist based in Paris.