Human Capital Issues

The allocations announced in the Budget for human capital development are indeed impressive. However, the question arises if the nation will get value for its money. There can be no denial of the fact that the Malaysian educational system is in disarray.

Standards have fallen dramatically. Our universities turn out graduates who lack rudimentary skills demanded by employers thus contributing to low productivity and loss of competitiveness. Our secondary school system is in disastrous shape.

Those who are charged with educating the next generation of Malaysians to be responsible citizens are more interested in promoting race hate as recent episodes of misbehavior by teachers highlight.

The lack of an adequate reaction from the top echelons of the Government has sent a strong signal to others in the educational system to project the message of hate that BTN promotes with impunity. These despicable acts and patterns of behavior give credence to the notion that the 1Malaysia slogan is nothing more than a catchy slogan devoid of meaning or sincerity.
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The Pivotal Role of the Private Sector

Much was made in the ETP presentation about reinvigorating private investment, with 92% of the total projected investment of US$444 being investment by the private sector. These expressions are repeated in the Budget Speech. However no details have been provided as to how this target is to be achieved.

The speech tantalizingly offers the suggestion that the Government will intensify the Public-Private Partnership to “… enhance private sector involvement in economic activities” To this end the Government proposes to invest RM 1 billion from the Facilitation Fund in support of several infrastructure projects.

On the one hand the formulation is built upon the notion that the private sector will be unleashed; and yet the ETP is in reality a top down creation. PEMANDU is seemingly picking “winners” and it would imply that Malaysia is about to embark upon a new form of central planning to get to highly untenable targets.
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Recent Economic Performance & Prospects

In the formulation of the Budget for 2011, the Prime Minister made the claim that the Malaysian economy had recovered from the global economic recession.

In an act of self congratulation, he attributed this to the proactive measures taken by the Government through the RM 67 billion stimulus package. He however failed to acknowledge that other countries in the region had performed equally well or even exceeded Malaysian performance.

The statistics he cited refer to the short term and are soothing. However, he made no mention of the challenging issues that will determine the medium term performance of the nation’s economy.

He appears to be suffering from a bout of amnesia about the need to address the issue of subsidies and to achieve fiscal balance.
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The Budget presented by the Prime Minister was a eulogy for the death of the New Economic Model. It provides a clear confirmation that this Government is incapable of living up to the rhetoric of reform that it had vigorously promoted over the past year.

The slogans and feel good speeches crafted by highly paid spin doctors have not been translated into clear action programs. The divided and weak BN Government remains mired and has now demonstrated its inability to deliver upon its promises of change.

The Budget marks the return to failed economic policies of the past. The Mahathir Economic Model built around mega projects, crony capitalists as key players, bailouts and handouts is once again alive and returns to haunt the nation.

The Budget yet again demonstrates that this administration is incorrigibly incapable of drawing lessons from the past and persists with policies that have entrapped Malaysia in the middle income trap.

The Budget for 2011 has all of the attributes of a blunt tool for distributing public funds to UMNOputras, BN cronies, and vested groups that constitute the vote bank of the Barisan.
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