Issue of land ownership

THERE is no issue that should receive greater analytical and public policy attention than that of land and there is no issue that has been more ignored in recent years by policymakers as well as policy thinkers. The last time serious attention was given to the set of issues that come together under the subject of land ownership was under President Ayub Khan.

A high-powered commission was then set up to guide the government in formulating its policy towards land ownership in the countryside. That urban land policy was also worth the government’s attention did not occur to the policymakers since it had not acquired the importance it has now in the country’s economy.

The issue of land has many facets: who owns it and how its ownership is distributed; who cultivates it and how the returns are divided between those who till the land and those who own it; how productive is the land and what are the reasons if productivity is lower than the potential; whether there is a market for land and how it operates; in what way does the distribution of land affect politics and economics; to what extent does the pattern of land ownership influence the incidence of poverty and income inequality etc., etc.

Each of these subjects — and many others related to land — can keep analysts occupied for years. Each subject should be the basis for serious government policy. And yet, since the days of Ayub Khan — and to some extent Zulfikar Ali Bhutto who showed some interest in this area — land has been ignored as a subject of policy discourse and public policymaking. One reason for this is the continuing power of the landed elite.

There is a seeming paradox about the way one powerful elite has used its influence to develop Pakistan’s economic and political systems. The landed aristocracy has been the main obstacle in Pakistan’s movement towards a broadly representative system of government. Even when elections were held on a regular basis which was the case in the period since 1985, the group’s grip over the countryside was too tight to allow the people’s voice to be heard in the corridors of power.

The legislators, no matter which party they belonged to, worked for their narrow interests rather than for the welfare of their constituents. This behaviour led to widespread corruption on the part of the people’s elected governments and made it possible for the military to intervene periodically. The obvious conclusion to be drawn from this is that the space the military created for itself in the country’s political and economic systems would not have become available had the landlords not exercised such a paralysing hold over politics.

And yet, this hold over the political process notwithstanding, the powerful rural elite did not influence resource allocation by the public sector in favour of the agricultural sector. Consequently, agriculture stagnated while public funds and public policy favoured other sectors of the economy. This is the paradox in Pakistan’s economic and political development. The power large landlords have wielded in Pakistan has hurt the country economically and politically. To understand why it happened we need to better understand the politics and economics of land use in Pakistan. This is the purpose of the article today and the one to follow next week.

This analysis must begin with a description of the pattern of landholding in the country not only in the countryside but also in the towns and cities. Landownership in many countries — and Pakistan is not an exception — is highly unequal, substantially more so than the distribution of income or consumption. One way of measuring inequality is to use the Gini coefficient that ranges between zero and one. Zero implies perfect distribution of whatever is being measured, income or assets. An estimate of one means that all the income goes to or all the assets are owned by one individual.

In the World Development Report 2005 published by the World Bank, Gini coefficients for land distribution were provided for 58 countries including Pakistan. Among these countries Norway, with a coefficient of only 0.18, had the most equitable distribution of land among the countries for which this information is available. The worst was for Venezuela with a coefficient of 0.88. Pakistan, with an estimated Gini of 0.57, was among the countries with relatively more uneven distribution.

While the Gini is high for land distribution, the coefficient is lower for income in Pakistan’s case as well as in the case of almost all countries. There is a good reason for this seeming discrepancy. Land does not always produce incomes commensurate with its market value. It is owned for reasons other than economics: there is attachment to land, it is owned since it provides insurance against bad times, and there are also speculative motives involved.

In most countries — in particular in South Asian states — a significant proportion of land is owned by the state and governments tend to use it to reward their supporters. The Mughal emperors did it; the Sikh rulers of Punjab did it; both civilian and military governments in Pakistan have done it. The dispensations of land by the British and the Sikhs created the system of jagirs that was abolished by the government of Ayub Khan in 1959 when it instituted its programme of land reforms. However, the government’s continued ownership of large amounts of land, in particular in the rapidly expanding cities, is affecting the structure of the economy as well as the way it is developing.

Complicating the issue in Pakistan is the ownership of vast tracts of prime land by the military in the cantonment areas in the heart of several major cities in the country. The British administration had appropriated these lands to build bases for its army in various parts of their Indian domain. Since the areas that now make up Pakistan were strategically more important for the British than several other parts of India, the proportion of the cantonment land of total state land is much larger in Pakistan. Significant acreage from this land is now being developed by the military within the aegis of the Defence Housing Authorities that have little to do with providing housing to military personnel and more to do with providing senior ranks with additional compensation for their service. This has introduced a serious distortion in the compensation system for one group of officials that needs to be addressed as a part of land policy.

There are strong equity and efficiency reasons for reducing inequalities in land distribution, both rural and urban. Why is it a good public policy to reduce the size of farms and reduce also inequality in the distribution of land? Why is it necessary to provide security of ownership to those who till the land but not own it?

I have already mentioned why it is important for political development to reduce the economic power of the landed aristocracy. There are also good economic reasons. For most crops, under normal availability of mechanical services, production is unaffected by the size of the farms. It is, as economists would say, neutral to size. However, when management requirements are substantial — this is the case for labour intensive crops, erratic weather conditions, frequent pest incidence — family farms, as opposed to larger wage-labour farms, can be more efficient because of advantages in supervising labour. Since the conditions cited above prevail in Pakistan it would be good public policy to aim to reduce landholding inequality and reduce the size of farms.

There is now considerable evidence from many parts of the globe that productivity is higher for the land owned by small and medium size operators. The gap in productivity of small and large farms within a country can be enormous: it was estimated at 5.6 times higher in the case of Brazil and, while not as high, to be 2.75 times greater in Pakistan. The estimates were made by two researchers, R. Albert Berry and William Cline, who worked for the International Labour Office’s programme on employment. The research was done in 1979 but the results are valid even today. It is bad economics not to give land to those who use it more productively. The reason why that does not happen is that land provides more than income; it gives status and political power.

Productivity is also known to increase when a programme of land reforms moves farmers from being sharecroppers to owners. Another set of researchers found that productivity is 30 per cent lower in sharecropped land compared to the same sized land cultivated by owners. On the impact of security of property some other analysts found that land reforms that gave farmers the right to sell, transfer, or inherit their land use rights also increased agricultural investment, particularly the planting of multi-year crops.

But simply taking land away from the rich and giving it to the poor won’t necessarily produce the results cited above. The state must do much more. It must also improve the economic circumstances in which the poor farmers work. In a comparison of land transactions in Indian and Bangladeshi villages during 1960-80, Mead Cain, a researcher, found that poor farmers who had access to a safety net programme used the land market to augment their holdings and undertook productivity-enhancing investments that include irrigation, use of better seeds and better production technologies. A programme of land reform that does not provide for some kind of insurance to the farmers will not yield the kinds of dividends mentioned above.

The conclusion to be drawn from the evidence cited above — and a great deal more is available — is that for Pakistan to realise the full potential of its well endowed agricultural sector and to pave the way for the development of a representative political system land reform should be high on the policymaker’s agenda of structural reforms. What kinds of attempts were made in the past and why did they not produce significant economic and political returns? What should the government do now to realise the full potential of the agricultural sector and also ensure that the disproportionate power wielded by the large landlords — disproportionate to the contribution they make to the economy — does not inhibit political development? I will address these and other questions next week.

The man who went to heaven

(This column was written by Art Buchwald from his hospice in Washington, D.C., where he is undergoing care. Buchwald has resumed writing his regular column.)

THE title of one of my favourite recent books is “The Five People You Meet in Heaven,” by Mitch Albom. It gets one to thinking about those five people. It’s a game we play at the hospice all the time, and I give it a lot of thought.

So far my list is: Ava Gardner, Grace Kelly, Marilyn Monroe, Rita Hayworth and Judas.

I don’t get much response about the women I’d like to meet, but there is always hesitation when Judas’ name comes up.

Why Judas? And what would you say to him?

I would ask him about his personal relationship with Jesus. Were they really good buddies, as written in the “Judas Scroll”? Or was he a turncoat?

The evidence for Judas being a good guy is very slim. We just have the scroll and Leonardo da Vinci’s “Last Supper.”

Da Vinci has 12 disciples painted at Passover, but when you look at them it’s hard to decide which one betrayed Jesus.

We can speculate all we want, but only when we meet Judas in heaven will we solve the mystery. The case for the Judas Scroll is very interesting. It reveals that Jesus asked Judas to betray him. In that way, Jesus could go to heaven and rise again.

The new scroll has an effect on all of us who are trying to meet people in heaven. It also affects people who are still on earth. For 2,000 years, Judas has been accused of being anti-Semitic. When I get to heaven I hope I can change all this.

Come to think of it, I could try to talk da Vinci into doing a new painting. This one would be called “The da Vinci Code.”

So it’s not too late to decide who would be the five people we’d like to meet in heaven.

While we’re on the subject of going to heaven, there’s another game we play.

Question: If you had only a month to live, how would you spend it? I’ve asked several friends the question. Two said they would like to spend their last month with their children. And one said, “I don’t even know where my children are.”

Another friend said, “If I only had a month to live, I’d go to Las Vegas and put up a million dollars at Binion’s poker table.”

One lady said she’d go to Gucci and get a decent pair of shoes. “You can’t walk around in loafers for an entire month.”

A male friend said he would watch every basketball final from courtside.

There was one man who was very surly. He said he’d spend the entire month getting even with all the people who had been mean to him. What makes him a real sourpuss is that he said, “There is no one in heaven I want to meet — I might not even want to go there. If a doctor tells me I have only a month to live, I’ll get a second opinion.” —Dawn/Tribune Media Services

How the GOP lost its way By

THE immigration reform debate has highlighted a long-standing fissure in the GOP between the elitist Rockefeller business wing and the party’s conservative populist base. Whether the two groups can continue to coexist and preserve the Republican majority is increasingly doubtful as conservatives begin to consider — and in some cases cheer — the possibility that the GOP may lose control of Congress this fall.

The two camps are deeply divided. The business elites are interested in a large supply of cheap labor and support unfettered immigration and open borders. The populist base supports legal immigration but is concerned about lawlessness on our border, national sovereignty and the real security threat posed by porous borders.

There is nothing new about this division. It is a 40-year-old fight that has its roots in the cultural, economic, regional and ideological differences between the two camps. Still, most conservatives felt that after the victory of Ronald Reagan and the Republican Revolution of 1994 their point was made and the country-clubbers would know their place. They were wrong. The Rockefeller wing is now attempting to reassert its control over the party and is openly hostile toward the Reagan populists who created the Republican majority in the first place.

Major Republicans have taken to attacking others within their own party as unsophisticated nativists. In a recent Wall Street Journal column, former Republican National Committee chairman Ed Gillespie warned populists to cease and desist from promoting “border enforcement first” legislation. “Anti-immigration rhetoric is a political siren song, and Republicans must resist its lure,” he said. And in a recent editorial, the Weekly Standard’s Bill Kristol attacked populist Republicans for not recognizing the danger of “turning the GOP into an anti-immigration, Know-Nothing party.”

Conservatives see this kind of rhetoric as inflammatory, anti-intellectual and offensive. Far from being driven by xenophobia and intolerance, conservative populists are motivated by a profound respect for the rule of law and by a patriotic regard for America’s sovereignty and national security. Upholding the rule of law and protecting our country’s borders is important to conservative populists and to most Americans.

To make their argument, some establishment Republicans are invoking Ronald Reagan’s name. In fact, Reagan argued that it was our government’s duty to “humanely regain control of our borders and thereby preserve the value of one of the most sacred possessions of our people: American citizenship.” Reagan was pro-legal immigration, pro-patriotic assimilation and in step with other populist conservatives.

The Republican Party is now unraveling. Sept. 11, 2001, and the war on terrorism stanched a lot of wounds inside the party, but resentment is growing over steel tariffs, prescription drug benefits, a League of Nations mentality, the growth of government and harebrained spending, the McCain-Feingold campaign finance law, the increasing regulation of political speech in the United States and endemic corruption.

On top of all the scandals, it has just come to light that the RNC paid millions in legal bills to defend operative James Tobin, who was convicted with associates in an illegal phone-jamming scheme aimed at preventing New Hampshire Democrats from voting. In doing so, the GOP appears to sanction and institutionalize corruption within the party.

The elites in the GOP have never understood conservatives or Reagan; they’ve found both to be a bit tacky. They have always found the populists’ commitment to values unsettling. To them, adherence to conservative principles was always less important than wealth and power.

Unfortunately, the GOP has lost its motivating ideals. The revolution of 1994 has been killed not by zeal but by a loss of faith in its own principles. The tragedy is not that we are faced with another fight for the soul of the Republican Party but that we have missed an opportunity to bring a new generation of Americans over to our point of view.

All agree that the Democrats are feckless and without a plan or agenda. But most Americans are now presented with a choice between two parties that are both addicted to power — the Democrats to government power and Republicans to corporate and governmental power. Who speaks for Main Street Reaganism?

It was the populists under Reagan, and later under Newt Gingrich, who energized the party, gave voice to a maturing conservative ideology and swept Republicans into power. We would be imprudent and forgetful to disregard this. But it may be too late, because conservatives don’t want to be part of the looming train wreck. They know that this is no longer Ronald Reagan’s party.

Craig Shirley, of Shirley & Banister Public Affairs, is the author of “Reagan’s Revolution,” a book about the 1976 campaign, and is now writing “Rendezvous With Destiny” about the successful 1980 campaign. His firm has clients concerned with immigration issues. —Dawn/Washington Post Service

Iran’s nuclear imbroglio

AS a signatory to the Nuclear Non-Proliferation Treaty (NPT), Iran has the inalienable right to develop research, production and use of nuclear energy for peaceful purposes in accordance with the statute of the International Energy Agency (IAEA) and its safeguard system.

However, the United States and its close allies are opposed to Iran’s nuclear programme, despite it unequivocal commitment to developing nuclear energy exclusively for peaceful purposes and in conformity with the safety regulations of the IAEA.

Time and again, Iran has also declared that, as stipulated in the NPT, it is committed to non-proliferation and the elimination of nuclear weapons and will continue to abide by its obligations under the NPT and also work for the establishment of a Middle East zone free of nuclear weapons as well as other weapons of mass destruction.

Washington’s case against Iran is built on the premise that it has repeatedly tried to develop capabilities to enrich uranium and separate plutonium which indicates that it intends to build nuclear weapons. It may, however, be pointed out that weapons-related activities such as uranium enrichment and manufacture of plutonium, are not prohibited under the NPT.

As a matter of fact, these are considered critical steps towards attaining an advanced domestic industry, an objective that is entirely in accordance with Article IV of the NPT. The Bush administration’s insistence that Iran should stop the enrichment of uranium altogether is, therefore, inconsistent with the NPT which allows the development of nuclear technology by its members for peaceful purposes.

Iran joined the NPT voluntarily and ratified it in 1970. Since then, its nuclear facilities have been under the supervision of the IAEA. As such, there was absolutely no justification for accusing Iran of pursuing a covert nuclear programme. However, President George W Bush keeps harping on this allegation not only to mislead public opinion but also to take some punitive action against Iran on the pretext of its alleged violation of the NPT.

Needless to say, it would be unwise to deter Iran from pursuing its peaceful nuclear programme by using force for this purpose, as hinted by President Bush himself, as it would be critical to regional peace and security. A military strike against Iran may perhaps delay the pursuit of its nuclear programme but would harden its resolve to pursue it more vigorously. President Bush should, therefore, avoid a perilous armed conflict with Iran on this issue and make an earnest effort to resolve the matter amicably through diplomatic means.

It may be pertinent to mention that whenever a weaker nation finds itself threatened owing to imbalance in its conventional capabilities it feels compelled to acquire nuclear weapons, as a means of deterrence for ensuring its security and territorial integrity. Apparently, Iran has no such impetus as militarily it is probably the strongest of all the countries in the region, including Israel. In view of this, there is no reason to disbelieve Iran that its nuclear programme is only for peaceful purposes.

If Iran is denied access to technology it intends to develop for peaceful uses it would leave many members of the NPT questioning whether their being a party to the treaty is worthwhile. President Bush should, therefore, change his existing stance on Iran’s nuclear programme if he wants to save the NPT which represents the only binding commitment in a multilateral treaty on the goal of nuclear non-proliferation.

It may interest readers to know that Japan, which is also a signatory to the NPT, possesses the scientific and technical knowhow and infrastructure that could enable it to build nuclear weapons. The fact of the matter is that by gaining the knowledge to develop energy a country automatically gets closer to the technology that could be used by it to develop nuclear weapons. It does not, however, mean that it will do so. In any case, the only viable way to forestall that possibility is to strengthen the effectiveness of the IAEA and to ensure that its safeguards system is strictly enforced. The IAEA should also have the right of unlimited inspection, without advance notice, when violations of the NPT by a member state are suspected.

The IAEA, established in 1957, is charged with the dual responsibility of promoting and controlling nuclear technology. It also focuses on preventing nuclear proliferation through the application of the agency’s safeguard system and enhancing the safety and security of nuclear material and facilities. It verifies the states’ nuclear non-proliferation commitments and provides assurances to the international community of the exclusively peaceful use of nuclear material and activities.

Thus, the IAEA is the only competent authority to prevent the diversion of nuclear energy from peaceful uses to the development of nuclear weapons. There is consensus among NPT members that nothing should be done to undermine the authority of the IAEA as it may make matters more complicated.

The spread of nuclear weapons and technology by a prospective delinquent member of the NPT is only one aspect of the problem. It is a well known fact that the critical technology and material needed to manufacture nuclear weapons are freely available in the black market and can be acquired by emerging nuclear states through middlemen based in western Europe and America. If Washington is indeed serious about promoting the goal of nuclear non-proliferation it should first plug those holes. The involvement of the Nuclear Suppliers Group and Missiles Technology Control in this endeavour may also be effective to achieve the desired objective.

After his election as president of Iran, Mahmoud Ahmedinejad, a conservative, declared that his country favoured a rapprochement with the United States. He had taken the first difficult step despite the fact that the hardliners, who were not favourably disposed towards the United States, had overwhelmingly voted him into presidency. It was hoped that President Bush would reciprocate these sentiments and the diplomatic stalemate that has lasted for more than 25 years would come to an end.

Regrettably, however, the US administration, which is under the immense influence of Israel, did not favour the idea of reconciliation between Washington and Tehran. Instead, it stepped up its Iran-bashing policy that has evidently further hardened anti-American feelings in Iran. This is a negative development that could lead to undesirable consequences.

The writer is a former ambassador.