The Missing Link

Can we survive without American Assistance?

Fayyaz Baqir

While there is a heated debate going on about Pakistan’s future without American Economic Assistance, it is important to know that we need to ask many more questions to be able to answer this question. No single individual or institution may be in a position to answer all these questions. But together we may be able to come up with observations, data and insights to find an answer. Faith in knowledge and humility are the most important prerequisites for this quest. The purpose of this and all subsequent pieces would be to seek help from other concerned individuals to contribute their knowledge to help us come up with a meaningful answer.

The first and most important question to ask is whether we can live without abuse of borrowed resources. Because if we make productive use of resources, we would never reach a situation where we can’t even pay back the interest on loans; leave aside the principle. We would never accumulate debt to the extent that we become economically crippled and shamelessly keep asking for more. If we use the borrowed money judiciously every country in the world would be competing to lend to us. It is important to remember that modern business world thrives on loans. All rapidly growing economies borrow heavily including USA.

The next question is to determine who is the  “We”, who receives, spends and pockets the loans from USA. Which institutions negotiate our loans? Has our debt policy ever been discussed in our parliament? Who is responsible for designing the borrowing policy? Have these decisions ever been brought up for discussion at responsible and representative Forums of our citizens before being finalized? We need to know how much did we borrow from USA in the past 3 decades at least. On what terms was this money borrowed? Where was it used? How much money went to Defence, Infrastructure, business development, and social development? Loans for Defence purchases can only be paid back by taxes. If we have not paid back our Defence loans we need to ask, how wide is our tax net? How efficient is our tax collection/ Who dodges and pockets the Tax money? How can we diminish the tax deficit? Loans on public physical Infrastructure have to be paid back by levying user fee on use of Infrastructure? What has gone wrong with our user fee payments? Loans on Business investment have to be paid by profits earned. Are our industries being run efficiently after long period of protection? Loans used for Social Sector must improve our social indicators: health, education, employability and income. Why our social indicators have not improved despite crushing burden of loan?

Next we need to ask, on which of the loans mentioned above did we default and why? Was any department penalized; any company or business declared bankrupt or any enterprise blacklisted because of non- payment of dues? Why did not we generate enough income by investing this money to pay it back?  Who swindled the money? What were the checks and balances in place to stop misuse and leakages of these resources? Were these checks and accountability mechanisms used? If not, why? If yes, to what effect?  Does anyone know anything about these questions? How can this information be shared? How can this information be used to prevent pilferage of resources in the future? Is there any documentation system in place to record all these transactions, analyze their impact and draw conclusions?

Does the money we borrow ever trickle down to the poor people of Pakistan? In which case has this happened and how much? How many jobs and productive enterprises have been created with this money? What impact has it had on our economic indicators? Has this money been used for patronage or development?  Whose survival would be threatened without this “Assistance”; poor people of Pakistan or patronized elites?

Why do we need to start accountability after the money has been stolen? Do we add another layer of corruption in the name of accountability or launder our collective conscience by setting up the “accountability” mechanisms?  What steps can be taken at the decision making stage to prevent signing a bad loan? Can ordinary citizens, interest groups, citizen’s organizations, research institutions, universities and media play any role in checking abuse of our trust by preventing provision of bad loans?

Can we as a nation; as government officers, office clerks, economists, politicians and political workers call a theft a theft? Why we only go after the thieves from other classes, ethnic groups, political parties, kin networks and interest groups?  Why can we not catch the thieves among us? If we cannot catch the thieves and do not dare to lend support to the ones who catch the thieves we sure cannot survive without USAID. Our moral deficit cannot be eliminated with financial resources. We need to muster courage to take correct moral and political position; as a voters, labourers, government employees, heads of household, intellectuals and politicians. Otherwise, we shall find our description in the slogan of student movement in 1960s- A spectator is a coward or a traitor. If we want to opt out of these two categories we shall need to go to the pickets. Not with slogans alone-like 1960s- but with hard evidence to the questions raised above. Only then we can bring a change because with sound knowledge we can negotiate.