Economy - time to act is now!

Talk about “disconnects” in Pakistan and the biggest one that comes to mind is between our economic managers and the economy’s real stakeholders! When indulging in performance evaluation, the question perhaps from their perspective being: ‘How well has Pakistan been doing lately’? Something that they would tend to simply measure in terms of macro-stability indicators like reserves, inflation, current account deficit and fiscal deficit, whereas, to an average person the underlying question instead being: ‘How well off are the Pakistanis due to their recent policies?’ After all, isn’t it the people whose interests are the foremost and shouldn’t democracy’s success in essence be measured by the tangible difference it makes in their lives? Not that one cannot create dents in the government’s claims to macro-stability successes, but of more relevance today is this developing feeling of mounting ‘unhappiness’ in the air, when it comes to the common man and the business sector!
Latest economic studies by economists guide us towards the notion that national balance sheets or sometimes even the material national standards do not matter. What really matters and creates happiness is economic activity per se, employment, satisfaction of being creative, hope, opportunity and last but not least, an environment that gives you a feeling that your govt is a help and not a hindrance, and it is one that protects and not eyes asset formation. In support, a recent report compiled by five Economics Nobel laureates under the Chairmanship of Joseph Stiglitz, highlighted that although Americans are richer than the Indians, the average Indian today in real life is happier than an average American, mainly because economic activity (and with it hope and opportunity) in recent years has shifted from the US to India.
Now, this whole phenomenon takes us back to the good old John Maynard Keynes, who is invariably dug up and remembered in times of trouble by the victims of depression, recession, unemployment, and as in our case, a case of growing economic inactivity, allegedly by lack of vision and incompetence. Such a case in turn leads us to ponder that should Keynes’s insights be drawn upon by us as a toolkit to designing and implementing stimulus packages? Or do his ideas, coupled with our recent experience, demand a more fundamental overhaul of our economic policies? Surely it is the latter we need to focus upon. If we take some time to read one of the recent works on Keynes, “The Return of the Master”, by Robert Skidelsky (a scholar who arguably knows Keynes better than any other), he recommends breakdown Keynes’s insights into two broad categories: Why economies lose their way; and why they can’t find a way out - incidentally also the main topic of Keynes’s most important work, “The General theory of Employment, Interest and Money”.