Debating lockdowns

26 Mar 2020

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The writer is a member of staff.
The writer is a member of staff.

WHO is advising Imran Khan to oppose lockdowns as a way of arresting the spread of the coronavirus? In my opinion, and I have good reason for holding this opinion, it is the industrialists of this country who are trying to convince the top leadership of this. But the same industrialists are now backing away from their opposition to lockdowns as the army has shown itself to be in favour of the strategy.

It is quite typical of this billionaire elite to couch their vested interests in some sort of overriding national priority. In times of economic adjustment, for example, they argued that textile exporters should get preferential access to natural gas at subsidised prices to help shore up the country’s foreign exchange reserves, and thereby prevent damage to the currency devaluations that bring inflation that hurts the poor.

They did not argue that they deserve preferential treatment and access to scarce gas resources so that they can make more money. That argument would not win them any concessions from the government. As it turned out, the way they framed their argument won them the concessions, and to this day the top leadership remains an ardent fan of subsidising gas and power prices for this segment, because the argument has been internalised that doing so will have a cascading series of beneficial consequences that will ultimately benefit the working poor.

Those of us who follow the economy and have observed the behaviour of the prime minister up close since he came to power have noticed the difficulty he has in making big decisions at critical times. He often hesitates when decisive action is needed that may well have adverse consequences in the short term, but which even basic common sense, let alone technical advice from the experts, tells us is necessary. He seems to lend his ear to all those who are arguing against such decisions, preferring the advice of those elements that echo his own fears.

Why is the central leadership opposed to the idea of a necessary, albeit painful, step?

Those in the business community who stand to be most hurt by the decisions that must be made find ways to disguise their vested interests in the language of some overriding national priority. This is precisely what happened in the run-up to the signing of the IMF programme, to take one example. There were many voices at the time saying that the circumstances called for an economic adjustment that would have a very adverse impact on business and the citizenry in general, with the recognition that there was no alternative. But between November and June, the government dithered, argued, bickered and even started speaking of a ‘home-grown programme’ around February or March of 2019, saying that maybe with all the money coming in from Saudi Arabia, China and the UAE, just maybe, there may not be any need for an adjustment after all.

That dithering and delay cost the country close to $6 billion, and eventually its hand had to be forced by replacing Asad Umar with an old school freelancer who had no compunctions about the costs of adjustment and who wasted no time in signing the dotted line with the IMF. I am reminded all over again of this story of how Pakistan embarked on its latest round of economic adjustment after a tortured path of dithering, pointless argumentation, while delusional hot takes floated on talk shows, all designed to obfuscate reality and deny the facts.

All along it was the billionaires of the business community who most dreaded the coming adjustment, even as they knew it to be inevitable. It was they who whispered complaints of the disconnect from reality that they perceived in the mind of the prime minister and his finance adviser. Later, as the adjustment got under way in earnest, it was they again who had to be called in by the army chief and told that the high interest rates and low public spending were here to stay and that they should cut out their public protestations on the direction of economic policy. They complied.

Today, all that is happening once again. It seems that one more time, the leadership has allowed itself to be talked into opposing the painful but necessary steps that the country has to take. After having climbed up the pole and publicly opposed lockdowns as a way of arresting the spread of the virus, the government finds that those who egged them on towards this path have suddenly fallen silent themselves, because the provincial authorities are moving decisively backed by the army.

A U-turn will now be difficult because the scale of the spread of the virus would then be blamed on the delay in ordering the lockdowns, just like the delay in getting onto an IMF programme was blamed for worsening the adverse impact of the ensuing adjustment. The central leadership’s hope now is that after a few days of lockdowns people will tire of the hardship that they bring and will begin to listen to it again. But if after that should come a spike in the number of people coming to the hospitals in dire need of critical care and quarantine, the hardship of the lockdown will again be forgotten.

Now, more than ever, the prime minister needs to make that U-turn for which he has become so famous. He is right that lockdowns will be very difficult to bear for the poor and the weak. But this is the time to support the efforts of the provincial governments that are racing to build social protection programmes and ramp up their healthcare systems and testing capabilities. Lockdowns coupled with these efforts is what it will take to get us through this challenge. The prime minister should take the lead in this and not be seen as obstructing the efforts of the provinces.

The writer is a member of staff.

khurram.husain@gmail.com

Twitter: @khurramhusain

Published in Dawn, March 26th, 2020