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Vandalism on the Capitol Hill: Food for thought for Pakistan’s democracy

In the case of the USA, the legislators from the Republican Party being pro-capitalist are reluctant to undertake radical pro-poor reform. In Pakistan’s case, pro-rich interpretations of Islam blocked all avenues of reform.

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The mob attack on the Hill engenders several questions about ‘demokratia’, ‘power to the people’. Has democracy become outdated in the modern age? Or, it has all along been a flawed system? Does today’s democracy has two masks, one practical and another practical? Has democracy failed to deliver goods?

Could mafias coexist with democracy?

Aristotelian democracy has been criticized because of the incompatibility of being at once ‘nonegalitarian’ and ‘socially equal’. In his study of political systems (oligarchy, monarchy, ochlocracy, etc), Aristotle concluded demokratia was probably the best system. The problem that bothered him was that the majority of free people (excluding women and slaves) would use their brute voting power to introduce pro-poor legislation like taking away property from the rich.

In the case of the USA, the legislators from the Republican Party being pro-capitalist are reluctant to undertake radical pro-poor reform. In Pakistan’s case, pro-rich interpretations of Islam blocked all avenues of reform.

Aristotle suggested that we reduce income inequalities so that have-not representatives of the poor people were not tempted to prowl upon haves’ property. James Maddison (England) harbored similar concerns. He feared ‘if freemen had democracy, then the poor farmers would insist on taking property from the rich’ via land reforms (Noam Chomsky, Power Systems, p 84). The fear was addressed by creating a senate (US) or a house of lords (Britain) as antidotes against legislative vulgarities of a house of a representative or a house of commons.

Aristotle could not visualize that two powerful politico-economic systems would emerge after his demise, socialism, and capitalism. The Aristotelian system had an uncanny ‘socialist’ wrapper. As such, it would be unpalatable to those following socialism.

Failure of the upper house

Creating an upper house, a house of the rich did not balance the poor against the rich. Soon contesting an election became a rich man’s business. And both houses became populated with the filthy rich.

Aristotle would rejoice in the grave to see even, both, Pakistan’s National Assembly and the Senate, being populated by the rich. One member defiantly wore a Louis Moinet ‘Meteoris’ wrist-watch, worth about Rs460m. They never took any legislative steps to equalize citizens in access to education, medicare, housing, and jobs. In short, in all realms of life in Pakistan. In the USA, also, the Republicans view the democrats as disguised socialist.

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Pak lawmakers never looked into the origin of the landed aristocracy, chiefs, and chieftains in the subcontinent during the Mughal and British periods. A politician knows the art of playing cricket. One day he may be fire and fury against ‘ESTABLISHMENT’. Another day he may pose as the champion of ‘establishment’.

The pliable politician knows the art of staying afloat, along with paraphernalia of legislature and other pillars of constitution. Doubtless, democracy in the USA as also in Pakistan is Aristotle’s dream as it is, by and large, stable, rich, and pro-rich.

Free reins to the mafia

In the case of the USA, the legislators from the Republican Party being pro-capitalist are reluctant to undertake radical pro-poor reform. In Pakistan’s case, pro-rich interpretations of Islam blocked all avenues of reform.

The Qazalbash Waqf v. Chief Land Commissioner (PLD 1990 SC 99) judgment is a majority-opinion judicial decision that blocked ‘land reform’ in Pakistan. The landed aristocracy began to occupy both houses. They ensured that agricultural incomes are not taxed. While NAB remained engaged in investigating urban incomes. No effort was made to probe the origin of the agricultural mafia.

An inherent flaw of modern democracy is that the whole population of voters could not flock to parliament to participate in discussions. Only a handful of people within the parliament make decisions for the whole country. Noam Chomsky calls the people in a democracy ‘a bewildered herd’.

Does today’s democracy has two masks, one practical and another practical? Has democracy failed to deliver goods?

The iron law of oligarchy is a political theory, first developed by the German sociologist Robert Michels in his 1911 book, Political Parties. It asserts that rule by an elite, or oligarchy, is inevitable as an “iron law” within any democratic organization as part of the “tactical and technical necessities” of an organization.

Michels’s theory states that all complex organizations, regardless of how democratic they are when started, eventually develop into oligarchies. Michels observed that since no sufficiently-large and complex organization can function purely as a direct democracy, power within an organization will always get delegated to individuals within that group, elected or otherwise.

We live in a different world now

There is an additional problem in Pakistan. Venal politicians pander to people’s religious sentiments by indulging in religious rigmarole. There was talk OF CONVERTING Pakistan into a Medina State. Much to his chagrin, even the chairman of Pakistan’s Islamic Ideology Council had to warn(October 22, 2018) medina state proponent against ‘romanticism’.  He urged the government to set up a task force to realize a “Medina State” and suggested the formation of a task force to realize this vision., The whole of Pakistan,  with wistful eyes, looks forward to the fulfillment of this dream of ‘new Pakistan’.

Unlike Medina, today’s Pakistan is a complex state. Shortly after he arrived at Medina, the Holy Prophet Muhammad (PBUH) built a mosque and a market place there. Like the mosque, the marketplace could not be privatized. There were free entry and exit of traders (akin to perfect competition under microeconomics) and caravans to the market. No monopolies, duopolies, and cartels! A section of the market caravanserai was reserved for foreign traders. The whole world could sell their goods there free of any taxes.  

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Some clever local traders tried to take advantage of robust trade. They used to buy caravan camel loads outside the Medina (before they reached Medina), and sell them at a dictated price. Islam outlawed this practice as talaqqiur rukaban (seeing faces of riders).  Islam prohibited all types of future trading involving elements of uncertainty (advance purchase of raw tree-fruit, fish in the pond, and so on). Islam prohibited usury (riba) in all its forms (loan giving at agreed interest taffazzul, or loan profiting due to delay naseea). When Bilal (may Allah be pleased with him) tried to exchange his coarse-quality dates with fine-quality dates the Holy Prophet forbade him. He told him to sell his dates for cash and buy better dates at the prevailing price.

The Prophet did not live in a 300-kanal-and-10-marla house (like Pakistan’s prime minister). Nor did he, like our numerous politicians, own assets abroad. He bequeathed a dozen swords but no precious metals (Golda Meier). Islam globalized the free-market mechanism (laissez-faire). It changed attitudes and avaricious mindsets. Being a dominant religion, Islam dictated its terms of trade.

Under preamble to Pak constitution ‘sovereignty’ belongs to Allah Almighty, not to people them as under the US constitution. The elected representative can wield authority within defined religious limits. Interest is outlawed under Article 38 (f) of the Constitution of Pakistan; quoted heretofore _ Article 38 (Promotion of social and economic well-being of the people) The State shall…(f) eliminate riba [economic interest] as early as possible.

In short, in all realms of life in Pakistan. In the USA, also, the Republicans view the democrats as disguised socialist.

The Islamic preamble (Objectives Resolution) was inserted in the draft constitution under Pakistan’s Prime Minister Liaquat Ali Khan’s influence. Unlike Pakistan’s most ‘leaders’, Liaquat Ali Khan was financially scrupulous. Aside from his honesty, Liaquat Ali Khan could not foresee he would be the first to sow seeds of religious discord. Jamsheed Marker, in his book Cover Point, observes, “Charge against Liaquat was that he moved the Objectives Resolution, which declared Pakistan to be an Islamic State.” (ibid. p. 33)

Unlike the US and many other secular constitutions, the Objectives Resolution (now Preamble to 1973 Constitution) states ‘sovereignty belongs to Allah Almighty’. The golden words of the constitution were warped to continue an interest-based economy. We pay interest on our international loans and international transactions. Do we live in an interactive world or an ivory tower? Isn’t Islamisation old wine in a new bottle?

Follow-up to ‘Interest’ outlawed

The Security and Exchange Commission of Pakistan enforced Shariah Governance Regulations 2018. This regulation is a follow-up to Article 38 (f) of the Constitution of Pakistan, and Senate’s resolution No. 393 (July 9, 2018) for the abolition of riba (usury) (extortionist interest) and normal interest/profit are indistinguishable. They disallow even saving bank-accounts. They point out that riba is anathema both as ‘addition’ (taffazzul) and due to ‘delay’(nas’ee) consequent upon fluctuating purchasing power.

The regulation is welcome but there are unanswered questions about the Islamisation of finance in Pakistan. We pay interest on our loans and international transactions. The sheiks put their money in Western banks and earn hefty interest thereon.

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Future trading is the hub of modern commerce. Yet, it is forbidden under Islam. At International Islamic University, I learned that the Islamic law of contract does not even allow advance contracts concerning raw fish, fruit, or anything involving an element of ‘uncertainty’. Islam does not allow even tallaqi-ur-rukbaan (buying camel-loads of goods from the caravan before they had reached Madina open-market. Holy Prophet (Peace be upon him) forbade Bilal (may Allah be pleased with him) to exchange poor-quality dates with superior-quality dates. He was advised to sell off his dates in an open cash market and then buy better-quality dates with money so earned.

Complex ‘interest’-based world

The gnawing reality of the complex interest-based economic world has now dawned on the government. To quote Murphy Law ‘nothing is as simple as it seems at first’. Pakistan needs to review the whole gamut of its economic structure (feudal lords, industrial robber barons, money launderers, and their ilk) and International Monetary Fund conditions. In his lifetime, even our Holy Prophet had to engage in commercial partnerships with the non-Muslim also.

Even Marx did not live in Utopia. He, also, constantly searched for solutions to the problems of the real world around him.

Disgusted at the simplistic interpretations of his ideas, he cried in boutade: “If this is Marxism, what is certain is that I am not a Marxist”. Keynes offered a panacea of deficit financing with concomitant inflation to swerve 1930-Depression unemployment and stagnation. He also reacted to misinterpretation of his ideas, saying ‘I am not a Keynesian’.

Aristotle could not visualize that two powerful politico-economic systems would emerge after his demise, socialism, and capitalism. The Aristotelian system had an uncanny ‘socialist’ wrapper. As such, it would be unpalatable to those following socialism.

Keynesian theories preceded a lot of discussion about the Gold Exchange Standard, stable prices.  To create more money, deficit financing (paper money) was resorted to. As a result, the hydra-headed monster of inflation was unleashed. Keynes believed inflation was a ‘short-run phenomenon typical of a full- employment stagnant economy’. But, it became a long-run phenomenon.

Keynes postulated ‘With perfectly free competition, there will always be a strong tendency for wage relates to being so related to demand that everyone is employed at a level of full employment’. When Keynes was asked about the persistence of inflation (too much money chasing too few goods), he replied ‘In the long run we are all dead’. Post-Keynesian economists coined the term ‘stagflation’ to explain the phenomenon. With visible massive joblessness, Pakistan is far from a full-employment economy.

The paltry household income has to bear the brunt of forced reduction in purchasing power due to rising price level, or falling rupee value. We adopted a floated exchange rate that ballooned our debt burden. No economist has ever applied his mind to the effect, positive or negative, of the international debt burden on Pakistan’s economy. No-one ever visualized even the idea of ‘odious debts’.

Pak government discourages savings

Keynes postulated savings are equal to investment. But, Pakistan discourages savings and encourage consumerism by reducing profit on saving deposits, and increasing taxes on small savings. Locke and others say the government can’t tax without the taxpayer’s consent. In Pakistan, the govt. picks people’s pockets through withholding taxes and reduction in National Saving Schemes profits.

Even unissued bonds lying in Pakistan’s State Bank vaults are included in each draw. State Bank, a body corporate, devours the prizes on such bonds without buying them. Pakistan’s hidden economy is more than the monetized one. It needs to evolve politico-religious milieu and macro-economic theories that suit our country best. It should promote savings while blocking illegal cash flows by introducing magnetic-card transactions in everyday life.

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Pakistan’s debts not payable being ‘odious’?

Pakistan’s debt burden has a political tinge. For joining anti-Soviet-Union alliances (South-East Asian Treaty Organisation and Central Treaty Organisation), the USA rewarded Pakistan by showering grants on Pakistan. The grants evaporated into streams of low-interest loans, which ballooned as Pakistan complied with forced devaluations or adopted a floating exchange rate. Soon, the donors forgot Pakistan’s contribution to the break-up of the ‘Soviet Union’. They used coalition support funds and our debt-servicing liability as ‘do more’ mantra levers.

All Pakistani debts are odious as they were thrust upon praetorian regimes to bring them within anti-Communist (South East Asian Treaty Organisation, Central Treaty Organisation) or anti-‘terrorist’ fold.  To avoid unilateral refusal of a country to repay odious debts, the UN Security Council should ex-ante [or ex-post] declare which debts are ‘odious’ (Jayachandaran and Kremer, 2004). Alternatively, the USA should itself write off our ‘bad’ debts.

But Pakistan and its adversaries are entrapped in a prisoner’s dilemma. The dilemma explains why two completely rational players might not cooperate, even if it appears that it is in their best interests to do so. .The ‘ prisoners’ dilemma’ was developed by RAND Corporation scientists Merrill Flood and Melvin Dresher and was formalized by Albert W. Tucker, a Princeton mathematician.

There is an additional problem in Pakistan. Venal politicians pander to people’s religious sentiments by indulging in religious rigmarole.

Several IMF and US state department delegations visited Pakistan. But, Pakistan could not tell them point-blank about non-liability to service politically-stringed debts. The government’s dilemma in Pakistan is that defense and anti-terrorism outlay (26 percent) plus debt-service charges leave little in the national kitty for welfare. The solution lies in debt forgiveness by donors (James K. Boyce and Madakene O’Donnell(eds.), Peace and the Public Purse.2008. New Delhi. Viva Books p, 251).

A fetter to Pakistan’s rapid economic growth is a debate between radical Islamists (fundamentalists) and liberal reformers The liberals, like Farag Fuda and Abu Zayd (Egypt), read the sources of Islamic sharia in terms of time and place (historical relativism). They advocate reading holy texts in our terms, interpreting them in accordance with spirit and intentions. The radials (conservatives) regarded the liberals as heretics or apostates. Farag was murdered in 1992 and Abu-Zayd was exiled in the following years.

‘Perfect Islam’

The conservatives say ‘Islam is complete’. The man in the street sees no undisputed Islamic model in Saudi Arabia, Iran, Pakistan, or anywhere. We ‘circumcised’ some banking, civil, and criminal laws to showcase them as Islamic. For instance, we introduced PLS, modarba, musharika. Practically, there was no tangible impact on society, the economy, or the polity. In international aid and trade, we conformed to secular principles. We continued to interest-based loans and pay debt service.

Islamic punishments, introduced by Ziaul Haq had a questionable impact. Sami Zubaida points out in his book Law and Power in the Islamic World (p. 224), “It is ironic that so-called Islamic punishments are described as ‘medieval’, when in fact, medieval jurists and judges showed great restraint in their application while modern dictators flaunt them as a religious legitimacy”.

Critics as hypocritical regard the Islamisation of laws. Pakistanis have a long list of Constitutional rights. But, a proviso makes them non-enforceable through courts. Pakistan’s qanun-shahadat (evidence law) defines the qualifications of a witness (tazkia-tus-shahood). But, it softens its Palladian to accept any witness if the ideal witness is not available. The less said about Sadiq and Ameen clauses, the better. Under these clauses, even a three-time PriceMinister was sacked by Pakistan’s Supreme Court.

A judge has to decide according to the law not according to his conscience and divine authority. An example is a ban on gambling like circuses by one judge. The decision was turned down on appeal as it is Pakistan’s Electronic Media Regulatory Authority, not the court to adjudicate such matter.

Democracy has an inherent flaw. To succeed it needs a handful of technocrats. They steer the country around corners. The US democracy will prevail as it Has in the past. But democracy in Pakistan is in peril as the politicians have no world view.

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Pakistan could not emerge as an Asian tiger because of indecision about what system to follow. The vested interests, particularly religious obscurantists, often smother dissent from so-called enlightened moderators. Rampant sectarianism in Pakistan with concomitant effects on the economy is an offshoot of lacunae in religious interpretations by vested interests.

Pakistan has abolished interest (riba) in accordance with its fundamental law. Yet its banking sector and international transactions are interest-based. Let Pakistan face the truth. It needs to evolve and showcase a politico-economic model of Islam that is compatible with international practices. Or else, dispense with hypocritical patchwork, and go for the secularist IMF model.

Mr. Amjed Jaaved has been writing free-lance for over five decades. He has served federal and provincial governments of Pakistan for 39 years. His contributions stand published in the leading dailies and magazines at home and abroad (Nepal. Bangladesh, et. al.). He is author of eight e-books including The Myth of Accession. He knows many languages including French and Arabic. The views expressed in this article are the author’s own and do not necessarily reflect the editorial policy of Global Village Space.

 

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