The way to a mans heart, mothers everywhere tell their daughters, is through his stomach. Well, the way to a businessman-politicians heart is through the business community. At least that is what President Asif Ali Zardari is banking on. The PPP supremo has called upon the Pakistan Business Council to gather the politicians to a round table conference and thrash out the issues of the economy. Pleading members of the business community is sure to melt the hearts over at the PML(N). A strange, tail-wags-the-dog approach. Ordinarily, it is up to the politicians to work issues of the economy out and then spell it out for the business community to adhere to. Or else.
Desperate times, however, call for desperate measures. The government really is in a tough spot here. The opposition and the populist media wont let the government increase its revenues (like reforming the GST, for instance) and they wont let it make any meaningful saving measures either (like transferring fluctuations in the international prices of oil to the public or phasing out subsidies on electricity units). All this leads to a fiscal deficit which the government has to then finance by borrowing money from the central bank, which, in turn, simply prints more money. This excess liquidity in the markets leads to more inflation. This, then, serves to further embolden the populist claptrap of the opposition and the media. A vicious circle, if there was any.
By now, however, even big business has come to realise that the proverbial really is about to hit the fan if the ruling party isnt allowed to put the governments financial house in order. You know things are bad when even the captains of industry and commerce are fully backing the imposition of the RGST, which will make cheating on taxes more difficult. To be fair to the suits at the PBC, most of them represent publicly listed companies, which cheat on taxes far lesser than those who oppose any kind of taxation, no matter how big their profits.