Ideology and debt: A reply to Dr Mahathir

— Pak Sako
The Malaysian Insider
Aug 23, 2012

AUG 23 — In his blog post “Change” (August 22, 2012), former Prime Minister Tun Dr Mahathir Mohamad criticised the socialist ideology.

He then claimed that “Malaysia has no ideology”.

This is not accurate.

It can be strongly argued that the Malaysian government after 1980 followed the “neoliberalism” ideology, a pro-business ideology.

This economic ideology was aggressively promoted around the world at the start of the 1980s by two pro-business world leaders: British Prime Minister Margaret Thatcher (elected 1979) and American President Ronald Reagan (elected 1981).

Both leaders had strong business connections and economic advisers who were pro-business, Alan Walters and Milton Friedman respectively.

Mahathir became prime minister around the same time, in 1981. Not long after, he officially announced a privatisation policy in 1983 (Jomo K.S. and Wong Sau Ngan (eds.), “Law, Institutions and Malaysian Economic Development”, page 42).

Mahathir too had close business associates, and his economic adviser was a businessman called Daim Zainuddin.

The neoliberal ideology says privatise publicly-held assets, sell them off to private business interests, entrepreneurs, corporate “captains”.

This is what the Malaysian government did.

The “massive privatisation strategy” carried out during Mahathir’s tenure is said to be linked to “increased competition for resources within the ruling Malay party”; it redistributed resources “in favour of emerging factions centred on key political leaders” (Jeff Tan, “Privatization in Malaysia: Regulation, Rent-Seeking and Policy Failure”, 2008, page 5).

Privatisation seems to be a favoured economic policy of the Malaysian government till today.

The neoliberalism ideology calls for weaker worker unions so big businesses can have more “economic freedom”.

The Malaysian government’s development agenda subordinated labour in favour of private business interests, especially in the 1980s (Jomo Sundram and Patricia Todd, “Trade Unions and the state in Peninsular Malaysia”, 1994). Labour organisations are weak relative to business power in Malaysia.

The neoliberalism ideology wants free labour markets, let wages be competed down if necessary, minimum wage rules are bad.

Mahathir also lately argued against minimum wages in Malaysia, claiming it might bankrupt Malaysia (“Dr M: Minimum wage may bankrupt Malaysia”, The Malaysian Insider, March 2, 2012). He did not consider the positive aspects of minimum wage rules.

The neoliberalism ideology supports a strong state, but not a strong state that directly provides for the public welfare, but a strong state that enables businesses and capitalists to flourish freely — corporate freedom and welfare.

Mahathir too does not like the welfare state.

The welfare state approach claims that basic social needs and securities must be fulfilled as a precondition to economic prosperity.

The opposite way is the neoliberal one: to support the corporate class in the hope that wealth will “trickle down” sufficiently to fulfil the fundamental needs of society.

In short: Mahathir complains about the injustices of the neoliberal international order, but he himself followed the neoliberal style (Johan Saravanamuttu, “Malaysia’s Foreign Policy, The First Fifty Years: Alignment, Neutralism, Islamism”, 2010, pages 202-203). Malaysia sharply switched to economic policies advocated by the neoliberal ideology under his rule. Mahathir’s personal positions on a number of issues are characteristic positions of the neoliberal ideology.

On debt, Mahathir says Greece borrowed a lot of money and is bankrupt.

But Europe fears Italy has also borrowed too much and is going bankrupt.

Malaysia has now been given a financial warning: a top debt ratings agency says our public finances are weak — they are at the same level as debt-struck Italy (“Fitch warns Malaysia of possible downgrade due to ‘deteriorating’ public debt ratios’, The Edge, August 1, 2012).

Malaysia’s debt is now more than half of the income Malaysia as a whole earns in a year. This debt is RM456 billion. This debt nearly doubled since 2007 — a matter of four years.

This is equal to saying that every Malaysian now owes about RM16,000. If you earn RM4,000 a month, that is four months’ pay.

Mahathir says: “Look at [Barisan’s] record… compare it even with the developed West. They are in deep financial trouble…”

Mahathir says: “Five years to give a trial as government is dangerous. Many things can be destroyed in five years.”

Question: Which government doubled Malaysia’s debt in less than five years?

  1. #1 by Loh on Thursday, 23 August 2012 - 9:37 pm

    ///He then claimed that “Malaysia has no ideology”.///

    Mahathir was making a sweeping statement. It might be more appropriate to say that the BN government has no ideology, in terms of how to perform its duties for the benefit of the nation. The government at the ministerial level practices the take, take and take policy, and it implements the divide and rule strategy. Civil servants are supposed to implement government policies without any political leanings, their mission is to implement the most efficient means to achieve government objectives. But civil servants and government institutions are serving their own interest in making sure that the devil they have remain forever.

    If one must attribute an ideology to BN, it is profiteering.

  2. #2 by sheriff singh on Thursday, 23 August 2012 - 10:42 pm

    Mahathir seems to think that nobody else can do better than UMNO and BN and we should therefore all stick with the current horses.

    PR should therefore go all out to convince the public that it can and will do a much better job when it is given a chance to rule. Given the current economic and political scenario, it should not be much of a problem to do this.

    If you meet and chat with some of the current BN Ministers like I did recently, you will be convinced that they are a bunch of idiots with nothing much up there.

    They are at best common people but most are really empty vessels with not much talents. They are there because of political positions that’s about all.

    PR politicians in my opinion are more talented and have more conviction for the welfare of the common folks. All they need is a chance to prove themselves. They are not all angels but certainly they are much better than the ‘devils’ of BN / UMNO.

    So let us change the old worn out horses for new lively ones. Take a chance babe.

  3. #3 by boh-liao on Friday, 24 August 2012 - 3:11 am

    Under MMK n UmnoB, M’sia got a new ideology: JIAK, JIAK, JIAK, Rent-Seeking, massive SELF-enriching of UmnoBputras n cronies

    MMK n UmnoB/BN hv bcome d DEVILs dat we know, as publicly claimed by MMK (B happy with d DEVILs we know, Y go 4 d unknown PR)

    MMK is infantile n twisting fact: Ask rakyat in Kedah, Kelantan, Penang, Perak n Selangor, do they KNOW d difference between d UmnoB/BN DEVILs n PR?

  4. #4 by boh-liao on Friday, 24 August 2012 - 3:13 am

    Under MMK n UmnoB, M’sia got a new ideology: JIAK, JIAK, JIAK, Rent-Seeking, [email protected] SELF-enriching of UmnoBputras n cronies

    MMK n UmnoB/BN hv bcome d DEVILs dat we know, as publicly claimed by MMK (B happy with d DEVILs we know, Y go 4 d unknown PR)

    MMK is infantile n twisting fact: Ask rakyat in Kedah, Kelantan, Penang, Perak n Selangor, do they KNOW d difference between d UmnoB/BN DEVILs n PR?

  5. #5 by Jeffrey on Friday, 24 August 2012 - 9:05 am

    Firstly is “neoliberalism” is also copied from the West (so don’t deride Obama) and then ‘rojaked’ with Buy Britain last/Look East to so called strive for Asian Tiger status. Neoliberalism’s cutting of public expenditure/privatization has been “rojaked” to suit our feudal patronage system to award to cronies and relatives. When neoliberalism implies emphasizing “individual responsibility” more than welfare state, he launched the opposite in the greatest affirmative program (NEP) to take care from cradle to grave; when Neoliberalism talks of deregulation and letting the market forces rule, he did the opposite where govt regulates everything under Malaysia Inc to maintain the NEP. Of course the govt since his time has an ideology – Neoliberalism in rojak form plus Ketuanan. It is based on political objective to perpetuate power. In that sense it’s a unique ideology. No other country has it. Its homegrown ideology is based on felt needs on how to perpetuate power.

  6. #6 by Jeffrey on Friday, 24 August 2012 - 9:06 am

    “…Firsly His “neoliberalism”…

  7. #7 by ENDANGERED HORNBILL on Friday, 24 August 2012 - 12:04 pm

    i CAN’T SEE why the world should bother with a loud-mouthed radical ignoramus parading himself as an icon of wisdom. Mahathir – it’s about time he is consigned to the rubbish heaps of history. His legacy in Malaysia marks the Great Depression in our time; his ruthlessness and manipulativeness sets blazed the trail for present-day hooliganism and immorality in UMNO.

    Do we need any more reason why we shud say good riddance to bad rubbish to Dr M?

  8. #8 by Loh on Friday, 24 August 2012 - 3:22 pm

    Mamakthir claims that he is not a racist. Thus racism is not his ideology rather than a strategy.

    If Mamakthir was a racist, then he would not have given up all links, so he claimed, with Calicut, Kerela India where his grandfather and his father was born and grew up. He said in his memoir that he did not know his roots in India but townsfolk remembered that Mamakthir returned to Calicut to demonstrate his success. He acted like the old saying that not returning to your root to showoff one’s success would be like walking with the gorgeous outfit in darkened street; nobody knew about it. Hence Mamakthir cared about what Calicut townsfolk thought about him. That act alone proved that he had not forgotten his roots. He was racist towards Calicut.

    Mamakthir could very well be racist for two half-races, but he once claimed that he had 100% Malay blood. Could it be that Mamakthir took after his mother’s blood group to claim 100% Malay blood? But he said to Barry Wain the author of Malaysian Maverick that he had two spoonfuls of Pakistani blood–that might be after centrifugal cleansing if it could ever be done.

    As politician Mamakthir said that he fought for race, the Malay race that he is said to belong constitutionally. He said recently that because he forgot his roots that he was accepted by their own kind to be indigenous people. Indigenous means native, can imported product be native goods?

    But does Mamakthir love Malay race? He certainly does because Malays do not object to the imported native constitutional Malays to hijack opportunities meant for them. It is because Malays ‘subcontract’ their political role to constitutional Malays that we see rampant corruption in the country. Malaysians have to suffer collateral damages because race-based party are not strict in ensuring that members they admit are one of them.

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