Ideals, economy and destiny.

THE level of despondency at Pakistan's economic situation seems higher than at most points in the recent past. Most conversations are peppered with descriptions of tightening household budgets, inflationary pressures, and the inability to catch a break. It seems surreal to even say this, but in some ways the general mood feels worse than it did 12 years ago. And to put this into perspective, we're talking about a comparison with the onset of the worst global financial crisis in a century and a wave of militancy in the country.

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As with previous instances, there's a fair degree of consensus on what an immediate path out from here - to avoid a default at least - involves. The good thing is that despite pressure from inside and outside government, the finance minister is very clear about this and is relying on basic fundamentals to steer it through. There's no recourse to voodoo economics, which remained a distinct possibility under those eyeing his seat.

On the whole, the Pakistani population is accustomed to dealing with painful periods of macroeconomic adjustment. The boom-bust cycles are reducing in length, so now we're seeing a crisis after just a short period of growth (and that too with high inflation).

A number of economists and business persons have mentioned that this crisis opens up the possibility for a consensus-based charter of economy between the government, opposition and the military establishment to undertake key reforms. This idea seems to be a recurring one every time the country experiences some form of macroeconomic imbalance. The logic being that if everyone in power (or with a chance of being in power) agrees to solve some basic issues, there will be no 'politicking' and no reversals in policy.

What's frequently missing in political discourse around the economy is a sense of a shared future.

The short argument against it is that the economy is inherently a political matter. It involves making decisions that have distributional consequences - ie who wins, who loses when a particular price is regulated, or when a subsidy is given out, or when an amnesty scheme is issued. Politics offers losers a chance to raise their voice - not just the so-called mafias but also regular people; taking that outlet away from them summarily would involve coercion and violence. How many people/groups are we willing to suppress for this charter to work? What are they going to get...