Written by Our Correspondent
Asia Sentinel
13 JANUARY 2014

Subsidy cuts play into UMNO rebellion

Malaysian Prime Minister Najib Tun Razak enters 2014 beset by growing hostility from both the public and within his own political party, the United Malays National Organization, characterized by a deluge of New Year messages across cyberspace celebrating the “year of barang naik,” Malay language for rising prices of items.

That is a play on the initials BN, for Barisan Nasional, the national ruling coalition. It has become an opposition battle cry to the point where Najib mentioned it himself in a recent speech

Najib is making an astute move now, after national and intraparty elections have been completed, taking on the necessary but unappetizing task of dismantling decades of subsidies that have driven government debt close to the statutory limit of 55 percent of gross domestic product. In the wake of both sets of elections, he is temporarily invulnerable to both opposition and intraparty assaults.

However, electricity tariffs have risen by 15 percent, sugar subsidies have been cut. Last September, Petronas, the national energy company, cut fuel subsidies in a move that it said would save the government RMB1 billion annually. Public anger at the cutting of the subsidies is substantial and growing

In addition, many in the party rank and file are still furious over widespread spending to keep the current leadership in place in the September intraparty elections.

That has brought the prime minister under unprecedented attack from bloggers aligned with the wing of the party controlled by former Prime Minister Mahathir Mohamad, who are delivering an extraordinary onslaught on his lifestyle and that of his wife, even going so far as an unprecedented call for attention to corruption within UMNO itself. The attacks had been expected from the time Najib blocked Mahathir’s son, Mukhriz, from becoming one of the party’s three vice presidents in the September polls.

Najib has sought to deflect criticism, saying the price hikes have been caused by factors such as the global economy and extreme weather that cut into the fish catch and drove up the price of vegetables. The government has also sought to spread the pain by cutting government ministers’ allowances by 10 percent, banning civil servants from business class flights, restricting expenses on official government functions. However, that hasn’t mollified voters, who staged public protests over New Year’s.

Najib also enraged voters by leaving for most of the holidays, going to Las Vegas and other watering holes with his wife, Rosmah Mansor, whose free-spending ways have alienated large swaths of the conservative Malay Muslim community. He is being called “Mr Nowhere” because of his absences from the country.

“A putsch is in the air, definitely, as the frustration with Najib’s free spending and extravagant lifestyle increases,” a Malay businessman told Asia Sentinel. “Najib is in the weakest position any prime minister in Malaysia has ever seen.”

Calls have been rising to have Mohamad come back to the government administrative center of Putra Jaya as an “adviser” to right the ship, something that appears highly unlikely. Mahathir himself made light of the idea.

In the meantime, bloggers who have been described as aligned with Mahathir have been raising their game, making broadly based attacks on Najib and even other UMNO officials, calling attention to what appears to be corruption in the award of highway contracts.

Kadir Jasin, a former New Straits Times editor and close longtime Mahathir ally, wrote recently that “To many UMNO leaders, the measure of the party’s success is big cars, big houses and expensive watches whose names they can’t even mention.” In particular, Rosmah has been criticized repeatedly for her taste in vastly expensive watches.

Kadir also called attention to “people with no formal appointments and duties (who) are known to use government on pretext of serving the country,” an apparent reference to Rosmah’s November commandeering of an official government jet to fly to Qatar to attend an international forum.

“Do they know that even the Queen (of England) uses trains and charters planes when travelling overseas? They should because many like the PM studied in the UK. Air transport for the British Royal Family and the government of the UK is provided, depending on circumstances and availability, by a variety of military and civilian operators. But most often they fly using scheduled commercial flights, normally the British Airways.”

“We are complaining about the wrong things he is doing in accommodating the wishes of his wife,” Kadir wrote. “We are asking the government to be accountable. The PM should answer these allegations. The way he bragged about his wife in public, he was in fact saying that his wife has more influence than him with foreign leaders.”

“Outsyedthebox” suggested that Najib, who had never finished his economics degree, actually “imbibed from the “Proton school of management” (the money-losing national car) “where it is a good thing to buy something high and sell it low. Or buy something high and then sell it even higher to people who have few options.:

“Mahathir’s and (former Finance Minister Daim Zainuddin’s) hands are all over the place but the point is that Najib and his wife are providing all the ammo,” a source said. “Without the ammo, Mahathir would be hard pressed to rally his troops against Najib.”

Everything “down to the price of ice has increased in a manner of two weeks,” said another UMNO loyalist. “Everything in Malaysia shot up in one month without notice. The government keeps the ringgit so weak against the US dollar, the cost of living keeps bouncing, salary increases are nothing. Crime is up, corruption is up. People are getting really upset.”

During the waning days of the premiership of Abdullah Ahmad Badawi, as the rank and file sought to push him out, “similar contempt was restricted to some segments of UMNO and the ruling elite,” a source told Asia Sentinel. “With Mahathir, it was disgust and contempt from intellectuals and rights groups. But with Najib – it’s across the board and it extends to his wife and friends.”