By Kumar David –

“The role of the intellectual is to speak truth to power” ~Quakers (1955), Edward Saied (1993)

Last week (3 May) I broached the issue of a unified multi-party response to the disaster created by the virus. It could be a multi-party Cabinet-team like Churchill’s inner War Cabinet, or some other tie-up that President Gotabhaya chooses, but the bottom line is: Political parties, ethnic communities and other groups must be functionally engaged. The key is NOT getting a consultative body to slurp around; that’s a waste of time. The key is to create a leadership team to take executive responsibility and to take charge. This is why the analogy with a War Cabinet is appropriate – Attlee took charge of the colonies, Beaverbrook supply and war-production, Earnest Bevin took on labour and services and so on (there was reshuffling during 1940-45). 

My suggestion evoked support in personal e-mails, won much appreciated endorsement from my Editor and I could espy hints of interest from a few party leaders. The reservation among leaders was “Oh Gota will never do it”; that is pessimism about Gota’s motivations. If true, it is a pity since for sure if he rises above partisanship and puts together a winning team, kudos will accrue to him. Let’s wait and see if he is big enough. Someone should repeat these lines to him though the likelihood that he will change is pretty small. 

There is a tide in the affairs of men.

Which, taken at the flood, leads on to fortune;

Omitted, all the voyage of their lives

Is bound in shallows and in miseries.

On such a full sea are we now afloat,

And we must take the current when it serves,

Or lose our venture.

The critical thing not to lose sight of is that the battle to rescue the country from shipwreck has not even started. Even the easy bit is not over; the real problems are starting. The administration is still at the easy part, lock-down and curfew, and still struggling to get that mess cleared up. It has not yet touched the hard part. The real problems yet to come are three-fold. The economy is in shambles, there are threats to democracy from forces that would like to play dirty in the havoc and third if there is second-wave infection the country will absolutely need to unite, unite and unite to fight. This essay will only talk about cleaning up the curfew-lockdown mess and discuss the economic outlook. 

However, first let me make a point that underlies my thinking. This an opportunity in a lifetime to squash our egregious partisan political culture and to banish pernicious ethnic divisiveness. If a many-party, many-community leadership takes over, working together will engender an environment in which these malign inheritances can wither.  No nation has the luxury of choosing its instruments of history – in Lanka if at this juncture it be Gota, so be it. It will be in his individual interests too as it will enhance his stature if he goes down in the books as the bloke who did it.

Terminate this crude lockdown and blindfolded curfew

Gota and his administration have been making efforts to tackle the ‘easy part’. However, curfew and lockdown in the past fifty days has been crude and excessive; a blunted instrument to deal with a tumour that needs surgical skill. Curfew continues indefinitely in five districts including the two most populous, an idiotic ID-card last-digit mantra has been contrived and the ruling cabal, on the roll, is as clueless as ever. A legal outfit known as the International Truth and Justice Project has published an “infographic” depicting Gota’s inner coterie of military brass and core family, today’s rulers. Add in Viyathmaga hangers-on and the GMOA to complete the picture. Heavy handed insensitive lockdown and curfew is extended interminably though new cases outside military cantonments is negligible and total deaths are single digit. How to further manage this scenario requires a broad-based political leadership not a squadron of brass and born-again Gota devotees.

A benign lockdown, indeed necessary and justified would have included:

a) Social-distancing, no large gatherings (sports, cinemas) and weddings, funerals max say 10

b) Shops regulated entry, one-way flow; supermarket numbers inside limited depending on size. 

c) Work-from-home encouraged for office type staff; short-term crisis time prohibition of others

f) Minimal interference with personal freedom (can visit friends/family but not encouraged)

But the country has suffered a draconian lockdown, especially in five Districts.

g) Factories, work places, construction sites ordered shut

h) Daily-paid, casual and informal sector work prohibited (families starve) 

i) Shops, retail outlets and supermarkets all ordered to shut down.

j) Curfew (some districts or whole country; crazy hours; haphazard arrangements; illogical locations)

New Zealand set about it thoughtfully. Four Alert Levels were defined and the country just moved down from Level-4 (Lockdown, but not blanket lockdown as in Sri Lanka and never curfew) to Level-3 (Restrict). An abbreviated summary of Level-3 follows to contrast with Lanka’s blindfold approach. I wish to drive home that a military-cum-Viyathmaha cabal is not equal to the job; we need a proven all-party national leadership that can mobilise all – parties and communities – and think. 

New Zealand’s Level-3 Measures (Much like what I have termed a benign lockdown).

Stay home other than for essential movement — including to go to work, school or for recreation.

Physical distancing of two metres.

Stay within household bubble, but can expand this to reconnect with close family

Schools can safely open but capacity limited capacity; learn at home if possible.

Work from home unless that is not possible.

Businesses can open premises, but cannot physically interact with customers.

Low-risk local recreation activities allowed.

Public venues – libraries, cinemas, food courts, gyms, pools, markets, closed.

Gatherings of up to 10 allowed for weddings and funerals. Physical distancing must be maintained.

Use virtual non-contact healthcare services where possible.

Inter-regional travel limited to essential workers with exemptions for others.

High risk or older people encouraged to stay at home but may work.

Dismal global economic perspectives

The web, the media, the Financial Times, the Economist, the IMF, the EU, Goldman, Fund Managers and pundits have assailed us with analysis and forecasts for the world economy for the next twelve to, if they are brave, 30 months. Since readers have access to this it will be adequate if I make the shortest possible summary as a lead into perspectives for Lanka. 

The consensus is that 2020 will be an annus horribilis. A few like Goldman stick their necks out with predictions of a glorious V-shaped recovery after two bad quarters, but most analysts have their feet parked firmly on terra-firma. The consensus is that we will be lucky to stave off a depression (that is a prolonged and socially disruptive global economic downturn); it is unlikely that the US and Western economies will stabilise in 2021 and there are question marks hanging over 2022. The reason for pessimism is precisely the actions now being taken by governments and central banks as ‘rescue’ measure – printing money like tabloid newspaper, QE that is multiplying sovereign and corporate debt by trillions of dollars and helicopter money (print-all-you-can Modern Monetary Theory). Global finance capital is on a trajectory foredoomed to a debt trap from which it has no idea how to escape.

This is an extract from Michael Mackenzie, Financial Times, 2 May 2020, strung into a para typical of what most analysts write: “Central banks have sent a message: this is not the time for a financial crisis triggered by capital markets. Grim assessments by policymakers in Japan, US and eurozone were accompanied by expressions of determination to keep pumping liquidity into the financial system. The rapid expansion of central bank balance sheets beyond $18tn will continue. The challenge from the coronavirus is less about liquidity than about solvency. Sovereign, corporate and household credit quality are all taking a very big hit. A default cycle is coming”. The United Nations said in April 2020 that the global economy could shrink by 1% in 2020 and conjectures that a worst-case scenario is more likely than its optimistic best-case scenarios. 

If the global scene is 2020 growth in the US and the West down to near zero, and 2021 very dicey, Lanka’s predicament is worse. The worst-case IMF lament for Lanka is that our economy will SHRINK at least 0.5% in 2020; down 4% from a previous 3.5% growth forecast.

Lanka’s frightening economic perspectives

A report in the Economist portrays Lanka as deep in public domestic-debt, foreign-debt, faced with high international borrowing rates and having minimal reserve cover. Of 66 countries assessed we come out as a miserable 61st in ability to survive without carrying the begging bowl to China, the IMF, the USA and the EU.  Worse is that our economy is 1/3-rd trade dependent; as long as the global economy remains depressed, we are begging from households themselves in bad shape. Our largest export, garments is dependent on Western markets and Asian raw material imports.

A nightmare scenario is if employment of Lankan workers and domestic helpers in the Middle East is disrupted. Do not forget that ours is a remittance economy which earns more than $7 billion a year that is over 60% of earnings from good exports on average, from this source. India has begun the repatriation of 190,000 nationals from the Middle East. Fleets of aircraft and the navy have been mobilised No one knows yet whether large scale repatriation of Lankans will become necessary. It is a deadly scenario not only because the loss of remittances will send our balance of payments into a tailspin but will also bring distress to tens of thousands of domestic (village) households.

Pulling the economy out of this rut, managing domestic and foreign debt, and restoring growth is a huge, one is wont to say superhuman, challenge. Agriculture and fisheries have been least disrupted and can get back into the swing once the market and not the military take charge of logistics. Getting every other sector up and running is going to be hard. The screw-ball transport arrangements to come into force tomorrow and the regimented staggering of working hours may be suitable for movement of military ordnance but it is a silly way to set about restoration of manufacturing.  Tourism is dead as a dodo for the rest of 2020. Services and small retailing will struggle at first but will revive. Ever resilient is informal economy, it will defy the brass and rise again.

The membership of the so-called Presidential Task Force on Economic Revival and Poverty Eradication is chaired by the notorious Basil and includes seven ex-military brass and cops but not a single representative of the nation’s political opposition! Conversely, my bottom line is that to deal with an impending economic catastrophe like this nation has never seen before, calls for restructuring of the political apex, unity of diverse cultures to reach a common vision, and breaking free of the dominance of military cabals and narrow interest groups.