Ishaq Dar has agreed with the governor of the State Bank that the market determines the value of the currency, thus implying that the present government has no role in controlling the steep collapse of the Pakistani rupee.
If an unbridled market economy had been the only panacea, there would have been no tremulous business cycles and shocks, which brought and can still bring even the best performing economies to a standstill. In fact, modern economies all over the world are mixed baskets containing the ingredients of capitalism and socialism. Deregulation, privatisation and such other vocabulary is not alien to free economies but, since the great depression of the 1930s, which continued to devastate the world’s economy for more than a decade, different other major and minor economic shocks have taught even the most strident supporters of a free economy a good lesson.
The US, the leader of the free economic model against the socialist Soviet Union, has been running a mixed economy. British economist Keynes, who planned the way out of the economic quagmire, suggested injecting huge government spending when private investors were shy. However, in the case of Pakistan there has been a client economy from day one. This is because we have always depended on foreign aid and loans. The different regimes have contributed in further battering down the economy, whenever it has tried to bounce back. Now the State Bank’s governor and federal minster are only attempting to shift the blame to the market economy.
Johi, October 22.