Time for fresh thinking

From the very start, the PML-N’s term in office has been like a roller coaster. On one hand forming coalitions, bonds and an understanding while on the other, trading barbs, bursts and insults with the same political opposition parties or with other state power centers, all of which while touching hot buttons, momentarily salvages anxieties and often puts a fist through the face of political correctness. However, it provides little confidence or hardly unleashes any laudable programs for sustainable development. While the Sharif leadership (both at the centre and province) has displayed this fascinating art of innovative political vision through its willingness to rhetorically (not practically) combine positions from the isolationist right, the far right, the centre right, the centre left, a liberalist, a conservative, a libertarian or a centrist, the trouble is that the resultant smoke screen has left the people totally confused. And this confusion, like any lack of clarity, is adding to national disorder and failing to produce the needed answers for any meaningful economic progress. Meaningful, referring to equitable distribution of resources and opportunities – accelerations in Moore’s law, the market and lack of clarity invariably affects the workplace, investment confidence (especially in the small and medium size enterprises) and national competitiveness, leaving people insecure and unmoored!

Given that the government has already completed more than half of its term; it is time for it to unleash some true nonpartisan policies that aim mainly at the common man, the critical economic sectors of our economy, and combines the following to provide for inclusive growth going forward. There should be focus on Healthcare, with a single-payer and government subsidized health care system for all. If it can work for Canada, Australia, Malaysia and many others, it can also work for us to provide better healthcare at lower prices and to ease the pressure on our already choked government hospitals. Indians have also just introduced a fairly similar initiative, where the policymakers became conscious that despite high growth numbers the poverty pockets remained un-dented. So, in response, a conscious shift has now been orchestrated to move away from aimless growth rate’s race to focusing on employment generation and providing advance healthcare to the workers. This new strategy gives priority to shoring up national competitiveness to ensure that home manufacturing thrives and by taking a leaf out of Obama care, aims to provide a more inclusive and affordable healthcare insurance especially to the low-wage segment.

There should be a common core education standards as the law of the land. This, to raise education benchmarks across the country, so school graduates meet the higher skill levels that good jobs will increasingly demand. However, these higher standards should be phased in with funding to enable teachers to have the professional development time to learn the new curriculum that these standards require and to make available the materials to teach it. New accelerated tax incentives and elimination of all regulatory barriers on the information technology (IT) sector: This, to rapidly scale up development of IT in the country and its usage among masses.

An agriculture package, one that will adopt a course similar to the Indian government, where it altered its facilitation mix to the Indian farmer by diverting a significant chunk of its subsidy to instead launching a new type of crop insurance scheme (Pradhan Mantri Fasal Bima Yojana) that mitigates crop risks for the farmer, but where the tab is mainly picked up by the government. In essence, it reduces the premium payable by the farmer to: 1.5% on rabi crops, 2% on kharif crops and 5% on commercial/horticultural crops, and in addition it frees commercial and horticulture crops from risk assessment on actuarial basis, which otherwise used to previously push up the premium to as high as 25% in certain cases. Further, direct transfer instruments like mobile phones and bank accounts are to be used for paying compensation (when due) by the government to avoid transactional deductions and unnecessary claim processing delays by the insurance companies. Expansion of the earned-income tax credit to top-up wages for low income workers and the introduction of a negative income tax to ensure a government-guaranteed income floor for every Pakistani who qualifies for the tax bracket. This will also help shore-up the tax to GDP ratio in the long-run.

The government should introduce a phased innovation and tax agenda that incentivizes start-ups and hiring. This means to reduce all corporate taxes, income taxes, personal deductions and corporate subsidies and replace them with a value added consumption tax (except on groceries and other necessities).Appoint an independent commission consisting of professionals to determine which, if any, of the existing laws are needlessly making it harder for entrepreneurs to raise capital or start businesses. We need to be sure we are preventing recklessness – not risk taking. Ban manufacture and sale (for use by anyone other than the law enforcement agencies) of all semiautomatic and other military style guns and the government should offer to buy back any rifle or pistol in circulation while simultaneously bringing about underlying security reforms that truly guarantee protection of every citizen. Last but not the least, increase military spending and ensure that our intelligence services have all the legally monitored latitude they need to confront today’s cyber enabled terrorism.

In sum, our slow growth, inequality and national security challenges require radical solutions. This means strengthening safety nets, curbing the bad environmental and health behaviors that are taking us down and paying for all this by sharply incentivizing risk-taking, innovation, investment and employment generation. Easier said than done, as it calls for a thinking government and one can only hope and pray that this leadership rediscovers itself and that it starts straining its mind from here on to 2018!

The writer is an entrepreneur and economic analyst. He can be contacted at kamal.monnoo@gmail.com

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