New alliance - or "who is afraid of the JVP?''
Near consternation and delirium greeted the accord between the JVP and the Sri Lanka Freedom Party signed last week at the BMICH. Colombo's elite was gagging, but there was an emotional reaction from the left and centrist forces that think they are but a short march away from power.

If the alliance must come to power, and if the people will it, it would. For starters, it was difficult to realize why the business czars had to panic the people. When the JVP was on the brink of usurping power through an insurgency they still panicked, as I distinctly remember, saying that the 'system'' is tottering on the brink. Why they should then panic when the JVP is well within the system and is becoming a stakeholder of the political establishment is funny for exposing the confusion of the business elite and the other obese buffoons and sundry props of the convenient establishment.

Certainly, there will be a phase of uncertainty if there must be an election today and the new alliance is propelled to power. But the catastrophe that the elite predict, as if they have been mortified by a diurnal apparition is nothing but a case of hysteria. They should consider the medieval wag who opined "the worst of our fears are imagined."

Their thesis of total systemic collapse due to the JVP insinuating itself into government is undercut by the fact that several of today's rampaging economies are in fact theoretically and ideologically socialist though in practice unabashedly free market! Count China and Vietnam, and consider also that China is the fastest growing economy on earth.

There is anxiety about JVP economic policy which of course is based on a theory of production as an antidote to market vagaries -- but, clearly the JVP is not and cannot be socialist to the point of being isolationist. For example, Malaysia has been cited by one of the JVP's idealists as a copybook case for emulation by Sri Lanka's future economic planners.

If that's the case, Sri Lanka's stock markets should be rocking instead of reversing, because Malaysia is one of the regions top Tiger economies, approaching a quality of life that's close to Japan in the region. But instead, the business leaders have got pneumonia and the political theorists have respiratory failure even before the JVP has caught cold.

True, signals and vibrations do matter in the world of investor confidence and international goodwill, and the JVPs sudden entry into any position of government will no doubt (this is all written in the hypothesizes that it is only a possibility) engender some negative reaction. But, if business plays its cards right, and does not cause a run on the system by a self fulfilling panic scenario, then the SLFP- JVP combine might have a chance to settle into the stark realities of power.

It could mean some good things, some bonuses too, even though an interruption to the economy on the immediate term may create a certain number of temporary hiccups. For instance, we would be fortunate to see the back of Milinda Moragoda style of buccaneering robber baron missionaries for globalisation who were determined to hand this country kicking and screaming even, over to the Americans. But that's only an incidental bonus.

There will be a real bonus if a JVP-SLFP combine can deliver, but a caution has to be sounded on that. Hitherto no Bandaranaike government has been able to deliver on the economic front. But it does not mean that sub-continental lessons will be entirely lost on a new combine. For example, similar reactions of horror greeted the arrival of the new Vajpayee government in India, especially on account of its mosque burning Muslim baiting xenophobic Hinduthva partiality. But, eight years down the road, the Vajpayee government has made an economic powerhouse of India, and Vajpayee has now called for early elections because he is so confident of winning.

The story of an untried JVP coming to power may not have the same happy ending as the story of an untried BJP coming to power in India, but considering that JVP will be under the wing of a larger party -- at least making the flank in a combine with the SLFP - there is no need for any stock analyst to go into deep convulsions.

But, if a new combine works as it did in India, it can have other bonuses also. Hopefully such a combine would offer some resistance to the horrendous designs of the IMF World Bank twins who with the help of American corporate capital want to privatize water resources takeover virgin forestland and create an American protectorate of sorts in this part of the Indian sub-continent. A special salute can be raised to a new power combine also if it can make irrelevant the national pestilence that goes by the name of the foreign funded NGO.

All that notwithstanding, there is the issue of peace. Here, prevailing indications are that a Chandrika government is not averse to a federal solution and that the Interim Administration etc., are not total anathema in the Kumaratunga book. Besides, the JVP says it will talk to the LTTE, which makes for a bottom line assessment which is that the new combine wants peace almost exactly the way the UNF does, except that they want peace to dawn on their watch. Given that long-term peace is difficult under anybody's watch, why should business lose its shirt?

All this is not to say that there isn't going to be a negative jolt on the economy if there is an election now. There is going to be a period of uncertainty if a new government is returned to power and if by some chance that is a JVP/SLFP government. The country's real problem is that both sides want to do more or less the same thing in the end - but there is never any continuity in economic policy or the policy on the conflict. But, all this column is doing is facing the reality that an election seems to be coming - and if one is coming - there is no reason to panic the people merely because there is a possibility that the JVP might be in government.

When asked what his economic policies are, Wimal Weerawansa said ''agriculture and productivity'' and then he said ''those who are now selling radios can get into agriculture'' and that most of our earnings are spent on food. He said foreign investment is needed, almost as if it was an afterthought. But incumbency will give this man who seems to know absolutely zilch about how a Malaysian style economy grows, a few hard knocks. As in India, there is a hope that an ''obscurantist'' dispensation will learn facts fast. But most of all the fact is that the JVP seems amenable.

The LTTE has announced already that it will not talk to the Sinhala chauvinist ingathering of forces represented in the new combine. This is bad news - but if there are signs that there will be a new round of war, people will certainly not vote for a new alliance. Already the obscurantism and the absurdity of the new combine on the issue of the conflict is being thoroughly exposed.

Meanwhile the new combine is not anti foreign investment, and besides there will be some big brother in the SLFP to supervise any swooning rustic back to the land idealist. True, to put a temporary break on a growing economy at this time is almost a crime. But, there can still be continuity even in the eventuality there is change, only if the business leaders don't pretend that it is the end of the world.

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