Tuesday, June 10, 2008

The Remedy for Pakistan is in the Fate of its Economy

“Our Urban Nightmare” by Mir Adnan Aziz (6 June) in Counter Currents.org (HERE):

We long for a spiritually satisfying niche, a human habitat that cooperates with our biological nature, a community rich with multifarious interactions. Communities are living, growing organisms that need constant internal regulation and whose health should be based upon happiness alone. 'No society can surely be flourishing and happy, of which the far greater part are poor and miserable'. Adam Smith made that statement back in the 18th century. It holds true for the Pakistan of today.”

Comment
The article is about the social situation in Pakistan amidst major changes in its composition, particularly urbanisation when people are leaving the land, where life is tough, and moving to the slums in the cities, where life is also tough.

Adam Smith’s comment quoted by Mir Adnan Aziz is about the social situation in Scotland in the 18th century when the country was on the verge of its commercial society moving through economic growth to the ‘industrialisation’ of the economy that transformed its economic opportunities from general destitution to a steady rise in per capita incomes on a scale never seen before in all history. Though it did not look like that to those involved – it took four or more generations – and there was much misery to go through yet.

Adam Smith was actually discussing another problem – nobody knew at the time what was really happening to Britain – the end of the Malthusian Trap, at least as experienced by the labouring poor. The middle classes were doing better and some among the chattering classes that ran the social system complained about the early signs of change in that they had a view that if the real wages of the poor improved they would become dissatisfied with their current economic circumstances!

The common complaint that luxury extends itself even to the lowest ranks of the people, and that the labouring poor will not now be contented with the same food, clothing, and lodging which satisfied them in former times, may convince us that it is not the money price of labour only, but its real recompense, which has augmented.

Is this improvement in the circumstances of the lower ranks of the people to be regarded as an advantage or as an inconveniency to the society? The answer seems at first sight abundantly plain. Servants, labourers, and workmen of different kinds, make up the far greater part of every great political society. But what improves the circumstances of the greater part can never be regarded as an inconveniency to the whole. No society can surely be flourishing and happy, of which the far greater oart ofnits members are poor and miserable. It is but equity, besides, that they who feed, clothe, and lodge the whole body of the people, should have such a share of the produce of their own labour as to be themselves tolerably well fed, clothed, and lodged
.” (WN I.viii. 35-6: p 98)

That was precisely what the commercial economy was supposed to do: spread opulence. Presently, Pakistan is a long way from achieving a beginning or of sustaining it.

It has a long way to go before the labouring poor of Pakistan can ‘be flourishing and happy’ and meantime ‘the far greater part of the members’ will remain ‘poor and miserable’. It could start on that road if it allowed its nascent commercial economy to grow, as Adam Smith realised when he studied what caused the wealth of nations.

Freedom and liberty will achieve the goal better than any known alternative. But nobody has a right to cease being 'poor and miserable', but they can achieve that goal is they are free to participate in a commercial economy with a supportive government that knows when to facilitate commrce and when not to intervene on the side of monopolists (capital and labour), but always on the side of consumers in competitive markets.

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