by Greg Earl
Australian Financial Review
Sep 2 2015

The idea of Singapore founder Lee Kuan Yew breaking into tears when he announced the city’s separation from Malaysia 50 years ago is now as much a part of the country’s foundation ideology as its lack of natural resources.

It has been both celebrated during this year’s 50th anniversary and disputed by those who think Lee was a cynical politician not unhappy to be carving out some space from the Malay world.

But one thing is certain as Singapore prepares for an election next week: few people are shedding any tears about being separated from the political train wreck underway across the border.

Indeed Prime Minister Lee Hsien Loong is racing to the polls a year early, taking advantage of the patriotic anniversary mood while his Malaysian counterpart Najib Razak can’t exploit differences among his official political opponents because of the political scandals surrounding him. Fortunately he doesn’t have to face voters for more than a year.

But between them, these two early flag bearers of modern Asia’s economic success are on diverging paths towards dealing with the same dilemma: managing a possible change of power after half a century of the same government.

And that’s despite the fact change is still not imminent.

NO FORMAL SHIFT EXPECTED

No one expects a formal shift in Singapore where the main benchmark is whether the People’s Action Party (PAP) can increase its vote from the historic low of 60.1 per cent last time on the back of anniversary nationalism and generous welfare-style spending.

Malaysia’s election is too far off to call. But despite much stronger public demands for change – demonstrated by the weekend protests – it is not clear that will actually happen due to both a gerrymander and, more importantly, a fractious opposition.

Father-knows-best democracy has helped the past economic growth of these two cousins. But with peers such as South Korea and Taiwan managing government change, any absence of a game plan on the Malay peninsula will become more of a question mark over the pair.

Singapore seems to be embracing the challenge. There used to be Orwellian talk of splitting the PAP into a government and a loyal opposition, or just the appointment of more non-elected MPs – a sort of House of Lords with PhDs.

But now there are extra seats and all will be contested, which theoretically lifts the opposition vote potential. The PAP has laid off on the old threat to cut services where it doesn’t win seats and seems to be relishing hitting the hustings with its new-look welfare state-lite policies.

The odds are it will lift its vote as Singaporeans worry about the global economic outlook. But this is really a transitional election where the new gaggle of opposition parties and modern candidates work out the right alternative policy approach for the future.

Over the causeway in Malaysia, the cousin that has had the more feisty political system in the past seems more stuck in the rut, with the old rural conservative Malay elite not being prepared to cede control to more modern, liberal multi-ethnic leaders.

MYSTERY DONATION IN BANK ACCOUNT

So we see Najib, who came to office as a liberal reformer, trying to explain a mystery $US700 million in his bank account as a mystery donation to help him fend off terrorism and win the last election. At the same time a state development company 1MDB, which Najib in effect oversees, has run off the rails amid fears of billion-dollar losses for no credible policy purpose.

Wong Chen, a member of the opposition People’s Justice Party who is in Australia this week, says this is a contrast to past financial scandals in Malaysia where there has been a plausible purpose before the mismanagement.

The opposition found itself in an unholy alliance at the weekend protests against Najib, with former prime minister Mahathir Mohamad, who has the remarkable track record of destroying his deputies while in office and his successors once out of office.

Mahathir had a mixed government record of traducing democratic protections but also using interventionist growth policies – the more purposeful forerunners of 1MDB – to blast Malays out of dependence on affirmative-action welfare policies.

There is no bigger ironic comment on the state of Malaysian democracy than to see him now making common cause with the opposition when he is responsible for jailing his former deputy Anwar Ibrahim, who was the opposition’s most potent leader because he had a rare ability to unite the different factions.

Time makes Lee’s parting tears look ever more crocodilian.