‘In the long run, we’re all dead’ wrote one of the most influential economists ever, at a time when he was already rubbing shoulders with London’s elite.

Lord Keynes might have started his career as a clerk in the British Civil Service’s India Office, but got disenchanted within 2 years and left the job - perhaps actually living through the reality of Akbar Ilahbadi’s jibe, ‘...clerky ker, khushi se phool ja’.

So, by the time he was criticising the dominant thought of his times, classical economics - eating popcorn while the economy selfcorrected to reach that fantastical equilibrium we have in Econ101 texts - he was writing from a rather comfortable position. In view of the harsh inequalities that modern economies are faced with - and at the admitted risk of offending Keynes’ soul - he may as well be read as, ‘In the long run, even we - the Lords - would be dead. For commoners, that’s the mediumterm outlook. And the poor could already be in the process.

The long wait for equilibrium is economics’ Achilles heel. Mainstream economics, by design, is concerned mostly with the affluent. Economic downturns, which may hurt the poor disproportionately, and push many into poverty, have been accepted as a ‘natural’ cost of economic booms. The discipline, as such, has one goal, to maximise and streamline the returns for investors, in the short, medium, and long run.

The argument is that GDP, and the average person’s income - GDP per capita - may only be increased by creating incentives for wealth creation and paving the road for capital concentration. If the ‘job-creators’ get rich, their incomes will pull up the GDP growth rate, and the common person will also be somewhat better off, in the long run - benefitting from ‘average’ growth. What’s strikingly missing in this conceptualisation of prosperity is the plight of the poor. It only talks about the rich - drivers of growth - and the commoners - the followers benefitting from average growth.

Talk about the poor and you risk yourself being labelled a Marxist who doesn’t understand how incentives - and the impeccable market forces of supply and demand - work.

No wonder, the whole field of Development Economics - which focuses on the economics of poor countries and poverty - has been faced with a question on its very existence, for example, from Deepak Lal, in his influential book ‘The Poverty of Development Economics’. The criticism being that economics is economics everywhere, and there is no different economics for developing countries.

Resultantly, the poor, despite being 22.7% of the world, are mostly edged out of mainstream discourse and their well-being is treated as a byproduct of overall growth. Locally, in the IMF’s financial programming and targets, in State Bank’s calculations, in FBR’s tax projections - you won’t find almost anything about the potential effects of a policy on the extent and depth of poverty and human development. The poor that represent 40% of Pakistan - every two in five of us - have no weight in the simulations that guide the budget.

How rising indirect taxes, higher utility bills, levy-laden fuel costs, and nepotism-riddled privatisatisation (and resultant price restructuring) shall affect the poor is anyone’s guess. Arguably, the economy needs to be stabilised and growth needs to be sustainable, but a 12 to 36 months IMF programme every few years, over and over again, is evidence of programmes’ own failure.

What’s plain to see is that the poor are thrown under the bus of austerity every time we sign an IMF programme in quest of the nirvanic long run. Half-baked nano- reforms are then engineered showing a semblance of recovery in macro-structural imbalances so as to let the IMF come out of the programme looking good.

The Fund and the government both compliment each other in economese, celebrating the ‘success’ of the programme in their press statements. Beneath that superficial success, are cosmetic measures, at which West-trained, up-to-the-minute economists are better than out-of-touch government officials.

What’s problematic is not the IMF’s policy advice per se, but the pace at which the IMF pressures a government to implement the roadmap it lays down and the obsession with numerical targets, completely overlooking the politico- economic context of policies and their fallout for the common person, especially when the government is just circumventing the conditionality to meet the targets.

In the long run, we keep going back to the IMF, as the rich switch between the real and the financial sectors, depending on whether the economy is in a low-interest, growth phase or high-interest, stabilisation phase. The middle class finds consolation in GDP figures and nominal raises, hoping paradoxically to climb up the social ladder. The poor, meanwhile, look on, waging a war against time to make enough money to pay the next bill, due in the very short run.

Usman Masood

The writer is an Assistant Professor at SZABIST University