Pie.
For all this talk about getting Malaysia to becoming a developed nation status in less than 10 years from now; in wanting to double our incomes when that day arrives, our leaders still display neither the discipline nor the confidence in making that economic leap. The Government still behaves like a lazy parent who tells one child to take a step back so that another can catch up. Instead of instilling confidence and telling all Malaysians that we have a great opportunity to collectively enlarge our economic pie, the ruling party allowed interest groups to pollute our minds that one group is after another group's slice of pie.
Those who believes that expansion of the pie is more important than deciding who gets which slice, advocates meritocracy and free competition within the economy. Rightfully, if the pie gets much larger, in the end, everyone wins. This group does not want to waste time arguing who deserves which piece. Like parents who believes in extracting their children's maximum potential, they understand that the weaker child must be accorded extra help, of course, but not at the expense of his other siblings and certainly on the premise that the child has to work even harder, since eventually he has to stand on his own two feet alongside his siblings when they enter adulthood. That by allowing all Malaysians to participate freely in all its economic activities, and in fair competition with each other, it unleashes a force that pushes this blessed nation to achieve its fullest potential. Conversely, by limiting competition, or erecting artificial barriers to protect certain privileged individuals, this will at worse, doomed Malaysia to stagnation and at best growth way below its true potential.
On the other hand, there is another group who purportedly supports positive economic discrimination, when in reality they are actually protecting their own piece of the pie. Noble national goals such as the NEP which aims to eradicates poverty amongst all the poor, are manipulated and twisted till it veers far away from its original objective and ended up being used as a shield to enrich a small coterie of politically-connected "masters of the universe". This latter group has little confidence in nor do they work towards growing this pie. It is easier just to demand their slice of the pie come what may, and if the pie shrinks, then they are entitled to a larger slice. They get the choicest cut, while leaving crumbs for those whom they are supposed to fight for. They rather put all their efforts into preserving their portion of the economic pie at all costs - even when the policies they stubbornly perpetuate cause this economic pie to grow much slower, as other nation's pie gets larger and larger.
In the end, the government's economic transformation programme will not take off, if we fail to transform the minds of those who still insist that one group's gain necessarily mean the loss of another's - that our economy is a zero-sum game. It did not have to be this way. Instead of fighting over who gets which slice of the pie, we should be working together to expand it. For too many years these narrow-minded politicians caused us to stand still holding our "prized" piece of pie, casting suspicious eyes over other fellow Malaysians, afraid that they will snatch ours away, while other nations has whizzed us by. They divert our attention away from the global arena where the real economic battles are being waged, to concocted local strives which we are led to believe it exists. No more Malaysians, let us not be duped any longer that my gain is necessarily your loss. It is time for Malaysians to drive out those that seeks to divide us in order to protect their slice - and choose leaders who work towards building a larger pie for all of us.
We all deserve a much bigger pie.
Monday, March 7, 2011
Friday, October 29, 2010
A Boros Government!
It really shocked me that in the midst of a record government deficit, our Tourism Minister has nearly exceeded her travel costs for 2010 when compared to 2009, "Yen Yen's travel bills hit RM3.25mil, The Star, 29th Oct 2010".
For a government that is seeking austerity measures - reduction of fuel and food subsidies, increase of service charges, plans to impose GST - a burden that it is asking the rakyat to bear, it is displaying a cavalier attitude when it comes to tightening its own belt.
Ng Yen Yen is said to have travelled to 26 countries and 61 cities since 2009, and her efforts paid off as shown by the increasing numbers of tourists to Malaysia despite a global slowdown in the tourism industry. Furthermore, the Tourism Ministry stated that due to our Minister criss-crossing the world, we have been elevated to top 10 "most popularly visited countries".
First of all, to directly attribute the increased tourist numbers to Ng Yen Yen's travels is on shaky grounds. Can the Ministry show a significant increase in the tourist numbers from the 26 countries that she visited? While the Ministry is trumpeting the single digit increase in tourist, our neighbour down south reported double digits. I wonder how many trips did her Singapore counterpart went to achieve these numbers?
An astute online commentator righty pointed out that we do not make travel plans based on what a Minister recommends. We look at the costs, the unique features of the country, the culture, the sights and sounds, etc. Singapore saw a surge in visitors due to their integrated resorts for 2010. It was a "wow" factor that drew in record travellers. Without a "wow" factor, regardless of how many travels our Minister makes, no one is going to be easily convinced to choose Malaysia over another destination.
This is a government that seemed to know the price of everything but the value of nothing. Isn't there a more cost-effective way to promote Malaysia? In her first class "budget" travel paid for by the rakyat, how many people did Ng Yen Yen managed to meet and talk about the unique characteristics of Malaysia? Seeing that she is travelling as a VIP, how many ordinary people did she actually talked to? Based on her travel reports, it seemed she was in effect promoting more of the countries she visited rather than Malaysia.
And meanwhile, we lost the opportunity to take advantage of the World Expo in Shanghai to "sell" Malaysia. Glaringly, it was pointed out that there was bad spelling mistakes in our brochures, unmanned booths, leaking roof, etc. And yet our Tourism Minister's response is well, there was hardly any. How much time did she focus on making sure our Malaysian Pavilion stands out amongst the hundreds vying for attention? Ng Yen Yen could have done no better that to have spent her days stationed at the Expo, where visitors have already topped 70 million. 70 million! Here is the most desirable target audience, travellers who have come from all around the world with substantial budgets, and who are no doubt avid tourists. She could have saved the country money simply by serving teh tarik to the Expo visitors, making sure the queue is orderly to maximise the number of visitors, and handing out brochures or travel coupons! 70m travellers in one single location...RM3.25m divided by 70m - that is just 5 cents per hit!
My suggestion to our Minister - save the rakyat money - visit our local sites for a change...there is much more to do within Malaysia than without!
For a government that is seeking austerity measures - reduction of fuel and food subsidies, increase of service charges, plans to impose GST - a burden that it is asking the rakyat to bear, it is displaying a cavalier attitude when it comes to tightening its own belt.
Ng Yen Yen is said to have travelled to 26 countries and 61 cities since 2009, and her efforts paid off as shown by the increasing numbers of tourists to Malaysia despite a global slowdown in the tourism industry. Furthermore, the Tourism Ministry stated that due to our Minister criss-crossing the world, we have been elevated to top 10 "most popularly visited countries".
First of all, to directly attribute the increased tourist numbers to Ng Yen Yen's travels is on shaky grounds. Can the Ministry show a significant increase in the tourist numbers from the 26 countries that she visited? While the Ministry is trumpeting the single digit increase in tourist, our neighbour down south reported double digits. I wonder how many trips did her Singapore counterpart went to achieve these numbers?
An astute online commentator righty pointed out that we do not make travel plans based on what a Minister recommends. We look at the costs, the unique features of the country, the culture, the sights and sounds, etc. Singapore saw a surge in visitors due to their integrated resorts for 2010. It was a "wow" factor that drew in record travellers. Without a "wow" factor, regardless of how many travels our Minister makes, no one is going to be easily convinced to choose Malaysia over another destination.
This is a government that seemed to know the price of everything but the value of nothing. Isn't there a more cost-effective way to promote Malaysia? In her first class "budget" travel paid for by the rakyat, how many people did Ng Yen Yen managed to meet and talk about the unique characteristics of Malaysia? Seeing that she is travelling as a VIP, how many ordinary people did she actually talked to? Based on her travel reports, it seemed she was in effect promoting more of the countries she visited rather than Malaysia.
And meanwhile, we lost the opportunity to take advantage of the World Expo in Shanghai to "sell" Malaysia. Glaringly, it was pointed out that there was bad spelling mistakes in our brochures, unmanned booths, leaking roof, etc. And yet our Tourism Minister's response is well, there was hardly any. How much time did she focus on making sure our Malaysian Pavilion stands out amongst the hundreds vying for attention? Ng Yen Yen could have done no better that to have spent her days stationed at the Expo, where visitors have already topped 70 million. 70 million! Here is the most desirable target audience, travellers who have come from all around the world with substantial budgets, and who are no doubt avid tourists. She could have saved the country money simply by serving teh tarik to the Expo visitors, making sure the queue is orderly to maximise the number of visitors, and handing out brochures or travel coupons! 70m travellers in one single location...RM3.25m divided by 70m - that is just 5 cents per hit!
My suggestion to our Minister - save the rakyat money - visit our local sites for a change...there is much more to do within Malaysia than without!
Wednesday, May 26, 2010
People First, Really? Subsidies in Malaysia
Subsidies distort the allocation of resource. Sure. It artificially depresses prices below market level and hence consumption is artificially boosted.
The Malaysian government is now educating the people on the perils of subsidies on the nation's purse strings. No arguments about that - subsidies which eats up more than 15% of the country's federal government spending and that which continues to grow is not sustainable.
But wait a minute here - before the government preaches prudence and wise spending, it ought to examine its head on the way it is squandering billions of potential revenue as well as its insistence on subsidizing certain privileged quarters. Before asking the people to pay for what it is worth, it better look at why it is looking the other way when there is clear gross mismanagement and theft of the nation's federal funds.
Let's talk about the biggest "artificial" burden on the working population - price of cars. The price of cars in Malaysia is a big joke - high excise duties causes prices to be several times that of developed countries so that Proton can hide behind the protectionist walls. Every ringgit earned by Proton is simply a transfer from the people's pocket to the GLC's bank balance. Coupled with the free money printing presses in the form of AP's, the government foregoes hundreds of millions potential revenue so that a small group of politically-connected simply sit on their behinds trading a piece of paper for tens of thousands.
And where is all the talk about open tenders? It does not take a genius to figure out that open competition for scarce resources will bid prices up. The federal government, still saw fit to build another convention centre, apparently so that the people who can no longer afford petrol or sugar can congregate there to discuss their plight, by exchanging a piece of prime land without calling for an open tender. And the contractor who got the project happens to be the biggest beneficiary of the AP system. Why not extract full value of the land by calling for open bids? With more established and bigger property players around, why deprive them of the opportunity to bid while depriving the nation of potentially much higher premium for the land?
Do you remember the RM40 screwdrivers? Computers that costs several times that of the market price? Pens so expensive because it can write on its own? Building contracts that overshoot the initial budgets by hundreds of millions? Toll operators that enjoy guaranteed profits by raising the toll prices every now and then? Why on earth must the people, all 30 million of us, have to give up subsidies on essential items on petrol, sugar and rice while we are being rob by unscrupulous robbers who are never caught and who continues to enjoy easy wealth?
And recently a sports betting license was given out - another potentially hundreds of millions of revenue forgone because no competitive bidding was called for what is a guaranteed money making gold mine.
All this talk about People First is a farce. We taxpayers are asked to tighten our belts, but our hard earned tax dollars are not spend prudently. Why oh why the government find it so difficult to remove subsidies, whether direct on indirect on these few individuals/companies and continues to allow profligacy to be rewarded and not punished, but expect the people to understand that the money that we pay in taxes cannot be returned to us in the form of subsidies?
The Malaysian government is now educating the people on the perils of subsidies on the nation's purse strings. No arguments about that - subsidies which eats up more than 15% of the country's federal government spending and that which continues to grow is not sustainable.
But wait a minute here - before the government preaches prudence and wise spending, it ought to examine its head on the way it is squandering billions of potential revenue as well as its insistence on subsidizing certain privileged quarters. Before asking the people to pay for what it is worth, it better look at why it is looking the other way when there is clear gross mismanagement and theft of the nation's federal funds.
Let's talk about the biggest "artificial" burden on the working population - price of cars. The price of cars in Malaysia is a big joke - high excise duties causes prices to be several times that of developed countries so that Proton can hide behind the protectionist walls. Every ringgit earned by Proton is simply a transfer from the people's pocket to the GLC's bank balance. Coupled with the free money printing presses in the form of AP's, the government foregoes hundreds of millions potential revenue so that a small group of politically-connected simply sit on their behinds trading a piece of paper for tens of thousands.
And where is all the talk about open tenders? It does not take a genius to figure out that open competition for scarce resources will bid prices up. The federal government, still saw fit to build another convention centre, apparently so that the people who can no longer afford petrol or sugar can congregate there to discuss their plight, by exchanging a piece of prime land without calling for an open tender. And the contractor who got the project happens to be the biggest beneficiary of the AP system. Why not extract full value of the land by calling for open bids? With more established and bigger property players around, why deprive them of the opportunity to bid while depriving the nation of potentially much higher premium for the land?
Do you remember the RM40 screwdrivers? Computers that costs several times that of the market price? Pens so expensive because it can write on its own? Building contracts that overshoot the initial budgets by hundreds of millions? Toll operators that enjoy guaranteed profits by raising the toll prices every now and then? Why on earth must the people, all 30 million of us, have to give up subsidies on essential items on petrol, sugar and rice while we are being rob by unscrupulous robbers who are never caught and who continues to enjoy easy wealth?
And recently a sports betting license was given out - another potentially hundreds of millions of revenue forgone because no competitive bidding was called for what is a guaranteed money making gold mine.
All this talk about People First is a farce. We taxpayers are asked to tighten our belts, but our hard earned tax dollars are not spend prudently. Why oh why the government find it so difficult to remove subsidies, whether direct on indirect on these few individuals/companies and continues to allow profligacy to be rewarded and not punished, but expect the people to understand that the money that we pay in taxes cannot be returned to us in the form of subsidies?
Monday, March 8, 2010
Why Pakatan Rakyat must survive
Recently, the mainstream media would have us believed that we have misplaced our trust in Pakatan Rakyat. This fragile coalition of political parties with vastly different ideologies, barely 2 years of age, cannot possibly compete much lest replace the mature Barisan Nasional. The recent turmoil in PKR; resignations of MPs; hostile criticisms from one coalition partner against another; accusations of corruption and power-hungry individuals; has indeed weaken the support amongst those whom have thrown their votes behind PR in the previous General Election.
Yet we must not be swayed by the BN or the mainstream media. We have to hold steadfast to the conviction that for a democracy to thrive, we need to have choices. Absolute power corrupts absolutely, and over the years of absolute power, BN has destroyed the concept of separation of powers as its consolidated its grip on the country. Our justice systems, media, public institutions such as the police force and anti-corruption agency has no credibility in the eyes of the public, when case after case of seemingly obvious misdeeds involving BN's bigwigs brought out neither repercussions or punishments.
Prime Minister Najib, regardless of how genuine is his intention to bring about the concept of 1Malaysia to fruition, will always be hampered by the entrenched self-interests of a small but powerful group of UMNO politicians and those whom rely on them for their political and economic well-being. These people will fight hard and dirty to ensure their interests are preserved at whatever costs, for any change in government will bring about their downfall.
For Malaysia's democracy to truly thrive, we, the voters have to be smart. Democracy requires competition. Competition for our votes. Only via competition will the political participants shape up. We have to break BN's monopoly on power, or at the very least, let them know we have to means to do so. Pakatan Rakyat may not be ready for power, given it still has to resolve many internal issues in order to reach a common political platform. But we must not abandon our only hope of a true 2-party political arena. Going back to status quo where BN has monopoly power, where citizens can be thrown into jail without trial or imprisoned for their "own protection", where the media is controlled in the age of the internet, where politicians are pitting Malaysians against one another when we should be uniting against global competitors, is plain crazy. We must not lose this opportunity to reclaim our rights as the political masters. Right now, only PR can provide us with that opportunity - lets not squander the momentous change we voters brought about during the 12th GE.
Yet we must not be swayed by the BN or the mainstream media. We have to hold steadfast to the conviction that for a democracy to thrive, we need to have choices. Absolute power corrupts absolutely, and over the years of absolute power, BN has destroyed the concept of separation of powers as its consolidated its grip on the country. Our justice systems, media, public institutions such as the police force and anti-corruption agency has no credibility in the eyes of the public, when case after case of seemingly obvious misdeeds involving BN's bigwigs brought out neither repercussions or punishments.
Prime Minister Najib, regardless of how genuine is his intention to bring about the concept of 1Malaysia to fruition, will always be hampered by the entrenched self-interests of a small but powerful group of UMNO politicians and those whom rely on them for their political and economic well-being. These people will fight hard and dirty to ensure their interests are preserved at whatever costs, for any change in government will bring about their downfall.
For Malaysia's democracy to truly thrive, we, the voters have to be smart. Democracy requires competition. Competition for our votes. Only via competition will the political participants shape up. We have to break BN's monopoly on power, or at the very least, let them know we have to means to do so. Pakatan Rakyat may not be ready for power, given it still has to resolve many internal issues in order to reach a common political platform. But we must not abandon our only hope of a true 2-party political arena. Going back to status quo where BN has monopoly power, where citizens can be thrown into jail without trial or imprisoned for their "own protection", where the media is controlled in the age of the internet, where politicians are pitting Malaysians against one another when we should be uniting against global competitors, is plain crazy. We must not lose this opportunity to reclaim our rights as the political masters. Right now, only PR can provide us with that opportunity - lets not squander the momentous change we voters brought about during the 12th GE.
Tuesday, July 21, 2009
MALAYSIA - SOS
I run a business that requires a fair amount of travel. I don’t profess to have travelled the whole world sufficiently enough to know which country has the best combination of the weather, political climate, economic conditions and social harmony. What I do know, based on my observations, is that Malaysia is still by far the best country to live in.
Of course, which country does not possess its weaknesses, its failures, and its share of occasional episodes of lunacy? Of late, Malaysia is in the news for all the wrong reasons– the gruesome murder of a foreign citizen; racial understanding being stretched to its breaking point; political intrigues and scandals that would provide Jeffrey Archer with enough bestseller materials; ; and unexplained deaths that basically drained off whatever little faith the average Malaysian still has in Malaysia’s public institutions, namely the police force and the Malaysian Anti Corruption Commission.
The perception that that the National Front’s leaders seemed immune to serious allegations against them, while the Opposition are being systematically persecuted for lesser crimes are being reinforced day by day. No one will be surprised if no big names are charged in the PKFZ scandal. Nor will anyone be surprised if nothing come out of the “Correct,correct, correct” judge-fixing allegations. The public has such low faith and trust in the judiciary and especially the ruling political masters that even a not-guilty verdict to a innocent person with connections to BN will simply scream “INJUSTICE!” in the public arena.
MCA; MIC; Gerakan; the major Peninsula-based component parties of BN, have fallen deep into the abyss. The notion that these component parties are nothing more than foot soldiers of UMNO, without any real teeth and are used simply to aim their guns at their Opposition counterparts are not farfetched when their priorities and sensibilities seemed to be terribly muddled. Reports of a former UMNO chief minister’s palatial mansion and his nonchalant explanation of how he can afford it is not being pursued by the component parties, instead they turn their energies to decrying the Penang’s Chief Minister rental of a bungalow. Go figure. Is it no wonder that MCA/Gerakan/MIC is no longer worth even talking about, since it is a virtual certainty they will be wiped out in the next General Election? Superman or not, Ong Tee Keat is steering a ship that is already half sunk; Koh Tsu Koon is captain of a shipwreck; and lets not even bother about MIC.
So the next Election will essentially be UMNO against the “rest of us”. No wonder UMNO is eager to enter into a unity pact with PAS. There lies its strongest chance of hanging to power. But the consequences of the pact, if it does materializes, will only tear apart this increasingly fragile multi-racial country, where even the pretext of power-sharing among all the major races will have shoved for the sake of power preservation, come what costs.
Well, so we have all these troubles. And even more gruelling tests await this nation. But no one in their right mind should want to see chaos. The unfortunate death of a young Chinese political secretary must not be allowed to be politicized. The Opposition, especially DAP, must not paint this as a race-induced death. Neither should the Government treat this tragedy lightly without utmost sensitivity and diligence.
So what is my point exactly? Sure, it all seemed in a mess. Where is the paradise that is Malaysia? But each country has its own troubles and shameful past. Malaysia is successful thus far because of tolerance. I grew up practically knowing only one Prime Minister. In the past 5 years or so we have had 2 different Prime Ministers. Whereas before we have a token Opposition, now we have a strong one who sees federal power as a very real possibility, if not inevitable.
Now is that a sign of political maturity? Of course it is. Democracy works bests when there is real competition for our votes. Therein lies our greatest opportunity to take Malaysia to the next level. But beneath that lies a great danger as well – if we allow those with will stop at nothing to preserve or change the status quo by playing the race card to obtain power, whether they are from the ruling party or the Opposition. If we succumb to racial-based rhetoric, surely this blessed nation will be torn apart at its seams and may take decades to come together again. Then we would have squandered a once in a lifetime opportunity to realise this country’s fullest potential – and instead ignite a dynamite.
So my fellow Malaysians – play smart. Look out those with smart ideas, give them your support. Shun those that appeal to your emotions via fiery rhetoric laced with racial divisiveness. We must not deprive our children of the same opportunities that we have enjoyed, nor should we allow the chance to transform this country to slip us by. Don’t be swayed by the divide-and-conquer tactics of any politicians. At the end of the day, it is up to us, the people, to bring about 1Malaysia.
Of course, which country does not possess its weaknesses, its failures, and its share of occasional episodes of lunacy? Of late, Malaysia is in the news for all the wrong reasons– the gruesome murder of a foreign citizen; racial understanding being stretched to its breaking point; political intrigues and scandals that would provide Jeffrey Archer with enough bestseller materials; ; and unexplained deaths that basically drained off whatever little faith the average Malaysian still has in Malaysia’s public institutions, namely the police force and the Malaysian Anti Corruption Commission.
The perception that that the National Front’s leaders seemed immune to serious allegations against them, while the Opposition are being systematically persecuted for lesser crimes are being reinforced day by day. No one will be surprised if no big names are charged in the PKFZ scandal. Nor will anyone be surprised if nothing come out of the “Correct,correct, correct” judge-fixing allegations. The public has such low faith and trust in the judiciary and especially the ruling political masters that even a not-guilty verdict to a innocent person with connections to BN will simply scream “INJUSTICE!” in the public arena.
MCA; MIC; Gerakan; the major Peninsula-based component parties of BN, have fallen deep into the abyss. The notion that these component parties are nothing more than foot soldiers of UMNO, without any real teeth and are used simply to aim their guns at their Opposition counterparts are not farfetched when their priorities and sensibilities seemed to be terribly muddled. Reports of a former UMNO chief minister’s palatial mansion and his nonchalant explanation of how he can afford it is not being pursued by the component parties, instead they turn their energies to decrying the Penang’s Chief Minister rental of a bungalow. Go figure. Is it no wonder that MCA/Gerakan/MIC is no longer worth even talking about, since it is a virtual certainty they will be wiped out in the next General Election? Superman or not, Ong Tee Keat is steering a ship that is already half sunk; Koh Tsu Koon is captain of a shipwreck; and lets not even bother about MIC.
So the next Election will essentially be UMNO against the “rest of us”. No wonder UMNO is eager to enter into a unity pact with PAS. There lies its strongest chance of hanging to power. But the consequences of the pact, if it does materializes, will only tear apart this increasingly fragile multi-racial country, where even the pretext of power-sharing among all the major races will have shoved for the sake of power preservation, come what costs.
Well, so we have all these troubles. And even more gruelling tests await this nation. But no one in their right mind should want to see chaos. The unfortunate death of a young Chinese political secretary must not be allowed to be politicized. The Opposition, especially DAP, must not paint this as a race-induced death. Neither should the Government treat this tragedy lightly without utmost sensitivity and diligence.
So what is my point exactly? Sure, it all seemed in a mess. Where is the paradise that is Malaysia? But each country has its own troubles and shameful past. Malaysia is successful thus far because of tolerance. I grew up practically knowing only one Prime Minister. In the past 5 years or so we have had 2 different Prime Ministers. Whereas before we have a token Opposition, now we have a strong one who sees federal power as a very real possibility, if not inevitable.
Now is that a sign of political maturity? Of course it is. Democracy works bests when there is real competition for our votes. Therein lies our greatest opportunity to take Malaysia to the next level. But beneath that lies a great danger as well – if we allow those with will stop at nothing to preserve or change the status quo by playing the race card to obtain power, whether they are from the ruling party or the Opposition. If we succumb to racial-based rhetoric, surely this blessed nation will be torn apart at its seams and may take decades to come together again. Then we would have squandered a once in a lifetime opportunity to realise this country’s fullest potential – and instead ignite a dynamite.
So my fellow Malaysians – play smart. Look out those with smart ideas, give them your support. Shun those that appeal to your emotions via fiery rhetoric laced with racial divisiveness. We must not deprive our children of the same opportunities that we have enjoyed, nor should we allow the chance to transform this country to slip us by. Don’t be swayed by the divide-and-conquer tactics of any politicians. At the end of the day, it is up to us, the people, to bring about 1Malaysia.
Saturday, May 23, 2009
India Shines, Malaysia Withers
It was such an unexpected outcome for the world largest democracy. Despite India’s sheer complexities - deep division along state lines, religious views and ideology, the Congress Party won just short of a simple majority to emerge with the strongest mandate in decades.
The stock market responded swiftly. It simply erupted, prompting the circuit breakers into action to control the surge in stock prices. Clearly, investors love the fact that with these strong win, the Congress Party can spend less time politicking in pandering to its myriad of lesser coalition partners, and focus on building the country’s economic fundamentals, especially during this deep economic slump.
Meanwhile, over in Malaysia, the Perak MB vs. MB crisis is still brewing with both political parties slugging out their political fight in the media, in the courts and in the hearts of the people.
At the same time, the Sedition Act is invoked to arrest one single activist who demonstrated against the political upheaval in Perak. His supporters too were arrested. In a blatant act of intimidation, the police even arrested their legal representatives. It was such a farcical sight captured on camera – dozens of stern-looking police barging out their compound and arresting peaceful demonstrators bearing candlelight vigils and lawyers who were simply seeking legal counsel for their clients.
These events played out as waves and waves of crime, some bearing most heartbreaking news, cause fear and anxiety among Malaysians. Even as the police declared crime rates to be down, it offers little solace to relatives and friend of victims who died as a result of petty crimes. It pains me when I read the news that a 5 year old, along with her mother and maid, were killed by a drug addict, all for the price of…one laptop.
On the economy side, Malaysian manufacturing figures for March fell 25.5% year on year, demonstrating that Malaysia is not out of the woods yet. There is no doubt Malaysia can withstand the slump, and come out with some decent growth for 2010. This is because of god-given strong fundamentals – Malaysia is blessed with rich natural resources and various commodities with no shortage of arable land and water.
However, there is no way Malaysia will continue to enjoy the high rates of growth which we took for granted in the past. Growth of 8% or more does not seemed possible because our political “leaders” are going to spend the next 3 years squabbling and campaigning for either the greatest victory or the greatest defeat in their political career and in Malaysian history, depending on which side of the divide you are on. Endless political wrangling; mudslinging; damaging personal attacks; etc – these “leaders” will continue to bleed Malaysia, instead of leading Malaysians.
The Opposition under Anwar Ibrahim is likely to continue to draw more support. The people, especially younger voters who will have a large say come the next elections, will no longer be swayed by the old BN mantra of “if it ain’t broken, don’t fix it”. Malaysia is broken. We may have the gleaming Petronas Twin Towers; the prestigious FI Sepang race; the Monsoon Cup (?). But our hearts are heavy with apprehension. We fail to understand why the ruling party still insist on dividing the people to carves out pockets of power for their own ambitions; why cases and cases of corruption are perpetually being investigated but no one important is ever brought to shame; why our legal system is in shambles with the alleged culprits still at large; why are we afraid of letting our kids go out into the streets without the supervision of a trusted adult. We wonder how is it that politicians stresses the importance of racial harmony, but fail to condemn those within their party who utters divisive remarks. Have they not learnt anything since the General Elections?
Anwar Ibrahim is riding this wave of discontent. The time is right – millions of young voters will come out strongly to cast their votes come the next General Election. And the ruling BN has given the Opposition plenty of ammunition to place the former on perpetual defensive mode. Given the consistent barrage of negative publicity on perceived transgressions of BN’s politics and politicians, Anwar will not let up the attacks and preserve his tag as “PM-in-waiting”.
PM Najib does not really have any choice. He cannot hope to ride out these negative sentiments by assuming the electorate will swing back by some token gestures. He has to act boldly and silence the Opposition’s guns. Repeal the ISA. Repeal the Sedition Act. Allow peaceful demonstrations. Political warlords and powerful businessmen who manipulated the legal system and/or abused their positions must be named and shamed and brought to justice. Revamp the police force by setting up the Independent Commission as recommended by the Royal Commission. A true leader must not be afraid of opposing views nor should they be afraid of making difficult decisions.
Particularly in the context of Malaysia, the PM must be seen to serve all interest of Malaysians, by levelling the playing field and espousing meritocracy and transparency. Stop this tyranny of the minority (the BN/UMNO elites) against the majority (the people!). It is time to put an end to this nonsense of pitting Malaysians against Malaysians, but to unite Malaysians to compete against the World. We wait with bated breath for a true Malaysian leader to show us the way.
The stock market responded swiftly. It simply erupted, prompting the circuit breakers into action to control the surge in stock prices. Clearly, investors love the fact that with these strong win, the Congress Party can spend less time politicking in pandering to its myriad of lesser coalition partners, and focus on building the country’s economic fundamentals, especially during this deep economic slump.
Meanwhile, over in Malaysia, the Perak MB vs. MB crisis is still brewing with both political parties slugging out their political fight in the media, in the courts and in the hearts of the people.
At the same time, the Sedition Act is invoked to arrest one single activist who demonstrated against the political upheaval in Perak. His supporters too were arrested. In a blatant act of intimidation, the police even arrested their legal representatives. It was such a farcical sight captured on camera – dozens of stern-looking police barging out their compound and arresting peaceful demonstrators bearing candlelight vigils and lawyers who were simply seeking legal counsel for their clients.
These events played out as waves and waves of crime, some bearing most heartbreaking news, cause fear and anxiety among Malaysians. Even as the police declared crime rates to be down, it offers little solace to relatives and friend of victims who died as a result of petty crimes. It pains me when I read the news that a 5 year old, along with her mother and maid, were killed by a drug addict, all for the price of…one laptop.
On the economy side, Malaysian manufacturing figures for March fell 25.5% year on year, demonstrating that Malaysia is not out of the woods yet. There is no doubt Malaysia can withstand the slump, and come out with some decent growth for 2010. This is because of god-given strong fundamentals – Malaysia is blessed with rich natural resources and various commodities with no shortage of arable land and water.
However, there is no way Malaysia will continue to enjoy the high rates of growth which we took for granted in the past. Growth of 8% or more does not seemed possible because our political “leaders” are going to spend the next 3 years squabbling and campaigning for either the greatest victory or the greatest defeat in their political career and in Malaysian history, depending on which side of the divide you are on. Endless political wrangling; mudslinging; damaging personal attacks; etc – these “leaders” will continue to bleed Malaysia, instead of leading Malaysians.
The Opposition under Anwar Ibrahim is likely to continue to draw more support. The people, especially younger voters who will have a large say come the next elections, will no longer be swayed by the old BN mantra of “if it ain’t broken, don’t fix it”. Malaysia is broken. We may have the gleaming Petronas Twin Towers; the prestigious FI Sepang race; the Monsoon Cup (?). But our hearts are heavy with apprehension. We fail to understand why the ruling party still insist on dividing the people to carves out pockets of power for their own ambitions; why cases and cases of corruption are perpetually being investigated but no one important is ever brought to shame; why our legal system is in shambles with the alleged culprits still at large; why are we afraid of letting our kids go out into the streets without the supervision of a trusted adult. We wonder how is it that politicians stresses the importance of racial harmony, but fail to condemn those within their party who utters divisive remarks. Have they not learnt anything since the General Elections?
Anwar Ibrahim is riding this wave of discontent. The time is right – millions of young voters will come out strongly to cast their votes come the next General Election. And the ruling BN has given the Opposition plenty of ammunition to place the former on perpetual defensive mode. Given the consistent barrage of negative publicity on perceived transgressions of BN’s politics and politicians, Anwar will not let up the attacks and preserve his tag as “PM-in-waiting”.
PM Najib does not really have any choice. He cannot hope to ride out these negative sentiments by assuming the electorate will swing back by some token gestures. He has to act boldly and silence the Opposition’s guns. Repeal the ISA. Repeal the Sedition Act. Allow peaceful demonstrations. Political warlords and powerful businessmen who manipulated the legal system and/or abused their positions must be named and shamed and brought to justice. Revamp the police force by setting up the Independent Commission as recommended by the Royal Commission. A true leader must not be afraid of opposing views nor should they be afraid of making difficult decisions.
Particularly in the context of Malaysia, the PM must be seen to serve all interest of Malaysians, by levelling the playing field and espousing meritocracy and transparency. Stop this tyranny of the minority (the BN/UMNO elites) against the majority (the people!). It is time to put an end to this nonsense of pitting Malaysians against Malaysians, but to unite Malaysians to compete against the World. We wait with bated breath for a true Malaysian leader to show us the way.
Wednesday, March 11, 2009
RM60billion mini budget, but little cheer for the man on the street
In the face of the global slump for exports, and coupled with the fact that exports accounts for 100% of Malaysia’s GDP, the stimulus need to have 2 basic ingredients – 1) boost domestic consumption to replace dwindling export demand; 2) reduce business costs especially for exporters which are facing shutdowns due to the sharp decline in foreign demand. While the government has announced measures to deal with the latter, little is being introduced to address the former.
Spurring Domestic Demand
There is little in the budget which raises disposable income for Malaysians. Instead, the Government opted to spend a subsidy of RM674m to AVOID PRICE INCREASE for necessities like bread, flour and sugar. Another RM480m is allocated to compensate toll operators NOT TO raise their rates. So, after RM1 billion of spending, it is still status quo for Malaysian consumers. The largest beneficiary of the RM1bn largesse is the toll companies, who despite the global recession, is still enjoying guaranteed profits. The only silver lining for Malaysian tax-payers is the tax relief given on housing loans.
The stimulus should have bold measures to put more money in the pockets of Malaysians IMMEDIATELY, as this is the fastest and most direct way to recycle more ringgit into the local economy, raising aggregate demand and via the multiplier effect, increasing incomes for everyone. This could be achieved by providing higher income tax relief for 2008, or better still, free spending coupons ala Taiwan-style to jump-start local spending.
Reducing Costs of Running a Business
The RM30billion or so worth of corporate/loan guarantees is a right step in enabling cash-strapped but otherwise healthy companies that are still seeing demand for their products to have access to fast and cheap credit. This will prevent companies who are still cost-competitive from collapsing simply because of the tighter credit market.
However, when a business is suffering from a slump in demand for its product or services, easier access to credit will not ensure survival if the recovery in demand does not come fast enough. In this aspect, it is more critical for these companies, many whom are exporters, to receive subsidies to reduce their operations costs or some form of export tax rebates. Otherwise, the only option left for these companies to slash costs is to fire staff. One way is to abolish the Human Resource Development Fund (HRDF). A cursory look at the balance in Fund would reveal hundreds of millions unutilised. It is perverse to force companies to continue to pay even 0.5% of their total wage bill to the HRDF, which then lay idle, when they are struggling to pay normal wages. And since the government is already spending billions on re-training and HRDF is a means to spur companies to train their existing staff, why the need to tax companies wage’ bill? The government should be subsidizing the companies’ costs of retraining, not taxing them.
There are also no incentives given to companies to retain their workers. In fact, companies now have an incentive to terminate their current workers and then re-employ those retrenched since they can enjoy double tax deductions equivalent to the annual salary of the re-hired worker.
The government has to remember this – Governments cannot create private sector jobs – it is the businesses that create these jobs. The governments’ role is to facilitate private businesses - by creating robust consumer spending and simultaneously reduce the operational costs of businesses. Instead of shuffling those retrenched or unemployed into temporary jobs or into some retraining schemes which may or may not match potential employers’ requirements, the funds for these schemes should instead be diverted to companies who are not retrenching workers to help them cope with the current slump.
On Equity Investments
There is also a statement in the Stimulus package which is kind of quirky. It states: The poor performance of Bursa Malaysia has also adversely impacted investor and consumer sentiment as well as the services sector, which normally is a high-growth sector “.
The cause and effect is reversed here. More accurately, it is the poor investor and consumer sentiments which caused the poor performance of the Bursa Malaysia. The poor sentiments are in turn caused by the falling demand for Malaysian goods/services and deteriorating corporate earnings. Indeed, while private think-tanks has been forecasting at best zero growth for Malaysia, the Government as recent as few weeks ago was still preaching the "fundamental strength" of the local economy. Investors clearly did not share in this optimism, which then sent the Bursa index falling.
In all, fiscal spending only amounts to RM15billion in this 2nd RM60 billion budget. The balance is in the form loan/corporate guarantees, etc. So lets not get wowed by the RM60billion figure being bandied about. The government should have opted to put more money directly into the rakyat’s pocket – the impact would certainly be more forceful in stimulating the local economy – vs. largely depending on public expenditure to boost local consumption. The latter, as we know, is prone to slow execution and leakages via corruption/rent seeking. Still, at least the government is now admitting that Malaysia, despite its “stellar fundamentals”, is not immune from the global economic malaise after all. Better late, than never, I suppose.
Spurring Domestic Demand
There is little in the budget which raises disposable income for Malaysians. Instead, the Government opted to spend a subsidy of RM674m to AVOID PRICE INCREASE for necessities like bread, flour and sugar. Another RM480m is allocated to compensate toll operators NOT TO raise their rates. So, after RM1 billion of spending, it is still status quo for Malaysian consumers. The largest beneficiary of the RM1bn largesse is the toll companies, who despite the global recession, is still enjoying guaranteed profits. The only silver lining for Malaysian tax-payers is the tax relief given on housing loans.
The stimulus should have bold measures to put more money in the pockets of Malaysians IMMEDIATELY, as this is the fastest and most direct way to recycle more ringgit into the local economy, raising aggregate demand and via the multiplier effect, increasing incomes for everyone. This could be achieved by providing higher income tax relief for 2008, or better still, free spending coupons ala Taiwan-style to jump-start local spending.
Reducing Costs of Running a Business
The RM30billion or so worth of corporate/loan guarantees is a right step in enabling cash-strapped but otherwise healthy companies that are still seeing demand for their products to have access to fast and cheap credit. This will prevent companies who are still cost-competitive from collapsing simply because of the tighter credit market.
However, when a business is suffering from a slump in demand for its product or services, easier access to credit will not ensure survival if the recovery in demand does not come fast enough. In this aspect, it is more critical for these companies, many whom are exporters, to receive subsidies to reduce their operations costs or some form of export tax rebates. Otherwise, the only option left for these companies to slash costs is to fire staff. One way is to abolish the Human Resource Development Fund (HRDF). A cursory look at the balance in Fund would reveal hundreds of millions unutilised. It is perverse to force companies to continue to pay even 0.5% of their total wage bill to the HRDF, which then lay idle, when they are struggling to pay normal wages. And since the government is already spending billions on re-training and HRDF is a means to spur companies to train their existing staff, why the need to tax companies wage’ bill? The government should be subsidizing the companies’ costs of retraining, not taxing them.
There are also no incentives given to companies to retain their workers. In fact, companies now have an incentive to terminate their current workers and then re-employ those retrenched since they can enjoy double tax deductions equivalent to the annual salary of the re-hired worker.
The government has to remember this – Governments cannot create private sector jobs – it is the businesses that create these jobs. The governments’ role is to facilitate private businesses - by creating robust consumer spending and simultaneously reduce the operational costs of businesses. Instead of shuffling those retrenched or unemployed into temporary jobs or into some retraining schemes which may or may not match potential employers’ requirements, the funds for these schemes should instead be diverted to companies who are not retrenching workers to help them cope with the current slump.
On Equity Investments
There is also a statement in the Stimulus package which is kind of quirky. It states: The poor performance of Bursa Malaysia has also adversely impacted investor and consumer sentiment as well as the services sector, which normally is a high-growth sector “.
The cause and effect is reversed here. More accurately, it is the poor investor and consumer sentiments which caused the poor performance of the Bursa Malaysia. The poor sentiments are in turn caused by the falling demand for Malaysian goods/services and deteriorating corporate earnings. Indeed, while private think-tanks has been forecasting at best zero growth for Malaysia, the Government as recent as few weeks ago was still preaching the "fundamental strength" of the local economy. Investors clearly did not share in this optimism, which then sent the Bursa index falling.
In all, fiscal spending only amounts to RM15billion in this 2nd RM60 billion budget. The balance is in the form loan/corporate guarantees, etc. So lets not get wowed by the RM60billion figure being bandied about. The government should have opted to put more money directly into the rakyat’s pocket – the impact would certainly be more forceful in stimulating the local economy – vs. largely depending on public expenditure to boost local consumption. The latter, as we know, is prone to slow execution and leakages via corruption/rent seeking. Still, at least the government is now admitting that Malaysia, despite its “stellar fundamentals”, is not immune from the global economic malaise after all. Better late, than never, I suppose.
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