Property is power.

PAKISTAN'S economic situation is unquestionably dire. The yawning trade and current account deficits, galloping inflation and default prospects have generated significant comment. It is noteworthy, though, that the working masses, who bear the biggest brunt of the downward economic spiral, barely feature in most analyses.

Most commentary has focused on the efficacy of short-term fixes like the 'Dar peg'. But there have also been prominent contributors on these pages who have presented prescriptions to stabilise and restructure the economy in the medium to long-run.

I disagree both with the foundational assumptions of most analytical treatises in vogue, as well as the long-term vision accompanying them. What follows is a reasoned attempt to engage with the dominant - what I'd characterise as liberal - notion of 'econoAmic reform', alongside a case for a class politics and redistributive policies which better represent the interests of Pakistan's working class.

Proponents of liberal economic reform start from the premise that Pakistan's economic woes are rooted in the state's excessive role and the unwillingness of politically motivated decision-makers to adopt market-based solutions. They say that it is by eschewing political pressure and making commitments to market-based solutions that the principle of merit can be resuscitated, the absence of which has led to the consolidation of a highly unequal economy where there is little or no prospect of social mobility for the majority.

The working class should be the object of economic policy.

There is undoubtedly concentration of wealth, inequality of opportunity and a self-serving 'elite' here. Yet the arguments that generally accompany these facts are tautological and selective; eg, how does one square the fact that a self-serving elite engages in rent seeking yet makes a pitch for a new 'elite bargain' to undertake policy shifts? Is it accurate to claim that privatisation of SOEs and further corporatisation of education are novel reforms?

A more meaningful historical analysis reveals that, over almost eight decades, Pakistan's ruling class has presided over a political economy that cannot be captured by a simple binary of state and market. The state has always enabled private enterprise to a significant extent, while both private interests and state institutions/functionaries comprise the 'elite', which means that rent-seeking is a set of practices that has historically been founded upon...