Election Outlook-XVIII: Equal distribution of misery

The equal distribution of electricity loadshedding across Pakistan has brought to one’s mind Winston Churchill’s famous words that ‘the inherent virtue of socialism is its equal distribution of misery’, although he had made these remarks in 1945 before the House of Commons for an absolutely different reason and in a profoundly different context.

How ironic, however, it was that the Punjab Chief Minister -in-waiting Shahbaz Sharif was drawing two days ago a sardonic parallel between power loadshedding situations in Karachi and his home province. According to him, “Karachi maen bijli jaati nahin hay, aur Punjab maen aati nahin hay”. Little did, however, he know that power outages had also begun to bite country’s largest city in a meaningful manner hours before he landed in Karachi.

That someone’s desire that Karachi also bears the brunt of electricity shortfall in an equal measure is now a stark reality. Such desire had found its best expression in the PML-N election campaign in Punjab where Shahbaz Sharif in particular targeted Karachi for unequal distribution of load shedding misery. The post-May 11 Senate too was highly critical of power supply to KESC from the national grid. It is however another matter that the current power crisis in Karachi emanates from what KESC says a huge cut in gas supply to its power generation units by a cash-starved Sui Southern Gas Company in which Government of Pakistan (GoP) has 70 percent shares.

That the PML-N wants an “equal distribution of misery” in the country in the shape of across-the-board power outages is a written or unwritten recommendation to water and power ministry and oil, gas and natural resources ministry if one takes into account the sudden spurt in power outages in Karachi. It is a gnawing question that will find the most plausible answer from the government-elect anytime soon.

But such a strategy can be the desire of some individuals but not a preference of a government that has to deal with and take care of not only one province but the entire country.

This point perhaps provides the best framework for a debate on the following question:

How do preferences play out as one of the central concepts of economics?

In his book Preference, Value, Choice and Welfare (published last year), great philosopher in economics Daniel M. Hasuman has passionately argued that economists do not say much about what preferences actually are. According to him, preferences are “more like judgements than feelings”.

The government-elect led by Nawaz Sharif is working out an economic revival plan under the guidance of veteran economist Sartaj Aziz. It is said to be finalising the contours of a relationship between governance structures and the distribution of power in economic policymaking. In other words, the government-elect is making hectic efforts towards distinguishing between “preferences” and “desires or feelings” through intellectual preparations before it formally takes charge of the country’s affairs.

No doubt, energy shortages are going to be the most onerous task of the new government. But its job is not going to be as stupendous or formidable as that of the then socialist governments of Eastern Europe and a radically socialist government of the then Soviet Union. While a slow process of economic reforms introduced by Deng Xiaoping worked for China, Yegor Gaidar’s `shock therapy’ under Boris Yeltsin more than one decade later caused immense harm to Russia that was still reeling from the shock of the disintegration of the Soviet Union. In a nutshell, the new government in Islamabad is not required to deal with massive shortages of almost all goods and services as was the case in socialist economies where Hungarian Janos Kornai had to write “Economics of Shortage” in which he critically analysed the economics of transition with a particular reference to the relationship between the state and the state-owned enterprises.

This occasion provides the new policymakers in Islamabad with a valuable opportunity to seek to write a new contract between the state and state-owned entities keeping in view the fact that old structural economies largely based on, among other things, import substitution and woefully overvalued currencies have failed. Such highly inefficient economies greatly disappointed even their staunch proponents such as Suharto of Indonesia and Nehru of India because of high invulnerability of capitalism and pervasive invincibility of free market.

The writer is newspaper’s News Editor. He’s member of the American Economic Association (AEA)