The ‘nationalisation’ under Bhutto was in fact bureaucratisation of the industries. Bhutto’s nationalization did not imply either workers’ management and control or collective ownership
There has been an aggressive campaign in the international as well as local media for more than two decades now that the recipe for growth and solution to the economic crisis is privatization. Attempts at the nationalisation of the industry, agriculture, finance capital and economy have regularly been dubbed as an economic disaster.
The burgeoning crisis and corruption in public enterprises such as PIA, WAPDA, Railways, Pakistan Steel Mills (PSM) and other such institution is ascribed to nationalisation and public ownership. For most analysts and politicians the solution is the ‘privatisation’ of these enterprises. These brusque and absurd statements only lay bare the obtuseness and mediocrity of the bosses who lord over nation’s destiny. They slavishly ape the western bourgeois economists who have miserably blundered in advanced capitalist countries and doctored the ongoing crisis.
The reality is that the massive economic development in Europe, the USA, Japan and other advanced capitalist economies was made possible through the state control of the economy thus maintaining certain social advances and stability. The economic history of Pakistan also contradicts monetarist approach to economics. In the 1960s, under the Ayub regime, there was a massive expansion of industry and infrastructure. Emphasis at the time was not on ‘trickle down’ or ‘free market’. On the contrary, it was the Keynesian model pushing the growth rate and expanding the economy. Although it was the by-product of the spin off effects of the biggest boom of capitalism in its history yet it was mainly through the state intervention that the economy surged ahead. The state spearheaded industrialisation, built dams and initiated infrastructural projects under the aegis of the Pakistan Industrial Development Corporation (PIDC). Similarly, land reforms were introduced while policies to expand and stimulate demand were introduced. But this model failed to carryout parallel social reforms which sharpened contradictions in society culminating in the revolutionary upheaval of 1968-69.
Despite 1971 debacle, the PPP government under the mass pressure carried out certain radical reforms in the country for the first time. Large chunks of the mainly domestic capital and industry were nationalised alongside massive land reforms. However, the capitalist state and the system were not overthrown under the utopian doctrine of a ‘mixed’ economy. The reforms were sabotaged by a bureaucracy that was in cahoots with the landlords, capitalist and the imperialist monopolies.
The failure of these reforms to deliver laid bare the myth of reforms within capitalist parameters. The ‘nationalisation’ under Bhutto was in fact bureaucratisation of the industries. Bhutto’s nationalization did not imply either workers’ management and control or collective ownership. It was a regime of state capitalism that tried to attack some sections of the ruling class without eliminating their system in its totality. As soon as they recovered from the initial blows, they sabotaged the economy resulting in severe social and political instability. In connivance with the imperialists and the military generals, they toppled the PPP government. Bhutto was sent to the gallows. It was venomous vengeance for the bruises that were inflicted through Bhutto-era expropriations.
In the 1980s when the Keynesian economics started to collapse especially after the oil shock and the first major post-war slump of the mid-seventies, ‘trickle down economics’ became new catch phrase under the synonyms of Reaganomics and Thatcherism.
There was nothing new about it. It was the same old capitalist policy of monetarism of the 1860s. The collapse of a bureaucratic caricature of socialism in the Soviet Union and the capitalist degeneration of the Chinese bureaucracy further gave impetus to this aggressive neoliberal economic model. However, these policies in the ex-colonial countries from Chile to Pakistan were a catastrophe for the teeming millions. The brutal but cowardly Zia dictatorship too afraid and cautious to introduce large scale privatizations. This regime was terrified at the prospect of a massive workers backlash since the workers movement was still strong and had the potential to overthrow the despotic regime.
With the return to democratic interregnum (1988-99)---under Benazir Bhutto and Nawaz Sharif---the privatisation process was accelerated. Thatcherism was the role model. As the workers movement ebbed, and left betrayed ideologically, [Fukuyama’s end-of-history theory became all the rage] stage was set for an aggressive privatization spree. The disastrous impacts on the workers and the impoverished masses were cynically ignored. Today almost all the mainstream political leaders in Pakistan subscribe to this doctrine of trickledown economics.
Ironically, there are numerous examples reflecting the progressive aspects of nationalization attempts. In its issue of 19th January the most ardent advocate of privatisation, The Economist, had this to write about the situation in Bolivia. “Since becoming Bolivia’s president in 2006, Evo Morales has brought ever more of the country’s economy into the hands of the state. In his first year in office he renationalised the oil industry. Telecoms, much of electricity generation and then zinc and tin mining followed. On December 29th Mr. Morales announced the expropriation of two electricity-distribution companies owned by Iberdrola a Spanish company...Bolivia has overtaken its wealthier neighbour Peru in access to clean water, the World Bank reckons... average incomes have more than doubled in dollar terms...The government may now be able to expand electricity provision, as it has with water...”. [But to sustain it all, Evo Morales will have to go the whole hog and expropriate the commanding heights of the economy. Capitalism has to be overthrown and the socialist revolution completed]
In Pakistan, privatisations will only aggravate the mass sufferings. What we can learn from the economic history of this country and the impacts it had on the population as a whole is that class interests are irreconcilable. For the ruling classes and their imperialist bosses these policies of privatisation etc are necessary to sustain their rates of profits. For the masses it implies exclusion from health, education, water, electricity and other basic needs of life. However, half-hearted nationalisations within the constraints of capitalism are futile and exasperate the economic crisis.
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Lal Khan is the editor of Asian Marxist Review and International Secretary of Pakistan Trade Union Defence Campaign. He can be reached at |
