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Contextual economic liberalism

Feb 23,2019 - Last updated at Feb 23,2019

As the “debate” on what constitutes a liberal or a conservative in the Jordanian context continues, it is essential to engage their stands on the economy, whether real or imagined. On the economy, as conventional wisdom has it, a liberal would support the position that says “government regulation of business is necessary to protect public interest” while a conservative would support the position that says “regulation of business does more harm than good”. These positions largely apply in established democracies, such as the US and Western Europe, despite some notable overlaps.

In our context as it has evolved in the past three decades, some “establishment conservatives”, hand in hand with some “parachuted in” free marketeers and “fonctionnaires”, also known as liberals, “liberalised” the market in an ad hoc fashion. While some established conservatives were not thrilled with the liberalisation, allies of free marketeers won the day and, in the process, markets were opened up prematurely. Price controls were largely lifted without the maturity of anti-trust laws or their implementation. The conditions of the market were not prepared for total, free competition. This has led to monopolies in a few essential sectors, such as energy and some foodstuffs. These monopolies harmed the consumers and we are feeling the heat of overpricing today, more than ever before.

The Jordanian public opinion is not uniform on the issue of private versus public ownership of business. Since 2001, more Jordanians supported private ownership than they did public ownership of business, according to the World Values Survey data collected periodically in 2001, 2007, 2014 and 2018 by the Centre for Strategic Studies and NAMA Strategic Intelligence Solutions. Today, 54 per cent of Jordanian adults would support the statement that says “private ownership of business should be increased”, while 43 per cent support the statement that “government ownership of business should be increased”. In times of volatility and uncertainty, these positions change. For example, in 2014 in the heat of the Arab Spring, two-thirds of Jordanians supported government ownership of business as opposed to one-third that supported private ownership. In 2007, when economic growth was more than 5 per cent, it was evident that more Jordanians supported private ownership.

Therefore, one can safely conclude that there is a third of Jordanians who are solid believers in the private ownership of business, even in times of uncertainty. A third fluctuates in uncertain times, otherwise pro-private, and a third is pro-government ownership. Consequently, more regional stability, and probably stronger implementation of competitiveness frameworks and anti-trust laws, will increase public support for more private ownership of business.

When examining attitudes on the profit of business in established free markets, a liberal would say “businesses make too much profit”, while a conservative on the other end would say “businesses make a reasonable amount of profit”. In our context, it is rather inverted. The vaguely-defined conservatives would adopt the position of western liberals, and the vaguely defined liberals would adopt the position of western conservatives, more specifically neo-conservatives.

On personal success, a liberal would be more of the view that “being successful is based upon which family you were born into and where”, while for a conservative “being successful is based upon individual effort”. In our context, the government has been, since its inception, the “liberal” force pushing education and health to compensate for unequal development, while the private sector is a profit-driven “conservative” service provider. The interdependency, interchangeability overlap between label and context’s components, among many other factors, makes the easily thrown labels of liberals and conservatives in Jordan not only impractical, but rather absurd.

One more example that makes the point clearer on the big picture: on the size of government in an established democracy and free-market economy, a liberal would argue “government is efficient and effective”, while a conservative would say “government is wasteful and inefficient”. I wonder what this means in our context. Also, on government’s role, a liberal would say that government aid should go to those who need it most first, and then to others. A check of both camps’ positions in Jordan on the National Aid Fund would reveal whether there is a real meaningful policy difference among them.

 

The writer is chairman of NAMA Strategic Intelligence Solutions [email protected] 

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