LETTER | I have read the open debate between economist Edmund Terence Gomez and Council of Eminent Persons chairperson Daim Zainuddin over the governance of GLCs and GLICs with great interest.
I am more inclined to believe that there is a frank denial by Daim that GLCs and GLICs do not cultivate political patronage and even cronyism.
It is extremely alarming how Daim defends the necessity of political appointments in the GLCs and GLICs as the prime minister 'prerogative', to the extent that he opines that a "minister of Durian can be appointed if the prime minister so wishes and if he considers that a portfolio of Durians is good for his administration and the country."
Yes, the prime minister has the absolute prerogative to appoint a "minster of dDurian" if he thinks fit, despite the fact that it would be a waste of government resources, an economic stupidity, and a political expedient.
Within the Westminster parliamentary model of democracy, if a British prime minister insists on a decision like appointing a 'minister of strawberries,' it will be deemed to be an excess of the prime minister's prerogative among the parliamentarians of our former colonial masters, and a backbencher rebel will be ensured until his or her eventual resignation.
The British do not even have a written constitution to ensure how a no-confidence vote could be tabled, but its democratic conventions bind all executives and parliamentarians. The boundaries of shame make their democracy work.
But what have we learnt from our former colonial masters in better governing ourselves beyond the rhetoric of blaming the poverty of Malays (it seems only all Malays are poor, and no non-Malay is poor) on former colonial masters, Jews, Chinese, Indians, non-Muslims, but their own ruling elite who have governed for the country for more than 60 years.
It is this precise disrespect to constitutional powers as manifested by Daim's response to Gomez's critique of state capitalism, a lack of little simple knowing of shame that has made a series of scandals such as 1MDB, BMF, Perwaja and the like go bizarre, notwithstanding the fact that our parliamentarians dare not rebel on conscience, but kowtow to benefits of allowances with appointments in the GLCs, GLICs, and various state agencies in return of political patronage to powers-that-be.
Daim's statement did not come as a surprise, as it is the former finance minister and Dr Mahatir Mohamad's right hand man who engineered the New Economic Policy by further extending the privileges of the Bumiputera, way beyond the scope of 'reasonable quotas' in the public civil service, to include a creation of state capitalism and GLCs, that have often bypassed any constitutional checks and balances.
It is extremely disturbing in many aspects from constitutional, socio-political to the actual economic effects of these get-rich-fast schemes. The plutocratic class created, even among the Bumiputeras and their non-Bumiputera associates, under this political remedy has long hijacked our democracy and economy.
A changing of the guard
Our Federal Constitution does not explicitly provide the prime minister such a prerogative, neither does it permit explicitly government should go into businesses. It has been purely a 'Bumiputera agenda' that Mahathir, Daim and Bersatu have propagated, which is no different from what they propagated when they were in Umno – like the old Chinese saying goes: "re-frying a plate of cold fried rice."
There has merely been a changing of the guard from ministers to state excos, local councillors, rural chiefs, chairpersons and directors of GLCs and government agencies, but there has been no regime and policy change. The perpetuation of the old regime is being done in even a more ferocious manner. The oligarchs distribute GLC and GLICs' directorships like their own grandmother's estates.
Mahathir has been honest about what he believes in and what he wishes to do. Firstly, he had made it clear that working with other component parties within the present Pakatan Harapan was to topple Najib Abdul Razak in order to save Umno and BN.
Secondly, he has more than once belittled the pre-GE14 Harapan manifesto, which promises reform of GLC governance, as "no bible" but only guidelines, meaning one should not take Harapan's promises too seriously.
It not only reflects badly on Harapan for a lack of political determination to fulfil its pre-GE promises, but it further demoralises the coalition as a political alliance and demeans the person himself who holds its highest office.
Gomez rightly warmed that those pledges in Harapan's manifesto contributed to its successful "ending of authoritarian rule in Malaysia," but it has already shown "alarming trends" by "finding ways and means to renege on its pledges."
He seems to be troubled – as, I believe, a substantial number of Harapan supporters are – by "a gradual and perceptible attempt to reinstitute the practice of selective patronage in the conduct of politics and in the implementation of policies, hallmarks of Umno politics that led to its fall."
For Mahathir, it was his intention to save Umno-Bersatu, and possibly a re-merger, to continue his propagation of the 'Malay-Bumiputera agenda'.
Political appointments
According to the democratic standards of our former colonial masters, Mahathir should have resigned over his demeaning of the Harapan manifesto itself, and needless to say, he has shown no commitment in reforming GLCs and GLICs but further continued a series of political appointments.
There has been no clear timeframe for making all these appointments transparent, but instead, reshuffling of GLCs and GLICs to statutory bodies has been made quickly to reconsolidate a minority component party, namely Bersatu's domineering position in Harapan.
Bruce Bueno de Mesquita and Alastair Smith in The Dictator's Handbook rightly point out that powers lie in the hands of those who control the distribution of financial resources.
The appointments of political allies in GLCs and government agencies with hefty allowances and salaries, with unknown individual performances to public scrutiny, has not only been cloned with various terminology from political patronage, cronyism, kleptocracy to plutocracy, but it is corruption legalised in the Malaysian context by legalising lawmakers and policymakers' direct involvement in government-run businesses with a return of political patronage. This is a corruptive and yet is well camouflaged with a legal shield.
Many government-linked corporations are being run as statutory bodies whose annual financial reports have to be tabled at the respective legislatures and be examined by the Auditor-General.
Nonetheless, statutory bodies are allowed to set up thousands of subsidiaries or GLCs, which actually function as private entities, whose annual financial reports are not legally compelled to be tabled at the respective legislatures.
These GLCs directorships are not legally compelled for any open legislature and public scrutiny, and they are potentially prone to abuses. Many GLCs accumulate huge losses and remain dormant with no reports made known to the lawmakers' knowledge.
The system itself cultivate opacity in GLCs' operation, and many scandals like 1MDB, BMF and Perwaja did not happen without reason. Being the chief engineer and co-engineer of the system, Mahathir and Daim would too have to answer to the people and history.
If the system is not to be reformed drastically, our socio-economic status may, in the future, end up as bad as Zimbabwe and Venezuela, decaying from their once glorious economic performance. We cannot forever keep blaming our 'former colonial masters' for the mismanagement of our economy and rampant corruption in our society. The rhetoric worked once but has become an ailment itself.
Policies have to adapt to new challenges in times like medicines too. Cocaine was the first found effective local anaesthetic used in dentistry and tonics used to revitalise patients by doctors, including Sigmund Freud, who himself became addicted to cocaine.
Cocaine was meant to be a useful medicine before its side effects were gradually discovered and banned for medical usage. Policy making is similar to finding new effective remedies for illnesses. Old, ineffective and addictive medicines have to be abandoned, and more effective and safer alternatives have to be made.
Let it be cronyism, kleptocracy or plutocracy as suggested by Bersatu supreme council member Rais Hussin, the root cause of the present socio-economic stagnation is caused by a race-based " Malay nationalist" economic model or the "Bumiputera agenda" that has been based on the ideology of Mahathir.
His ideology was clearly laid down in his writing The Malay Dilemma. If the 'Bumiputera agenda' is inclusive, why should Malaysians be divided into Bumiputera and non-Bumiputera based on race and creeds? Bersatu itself is clearly in a great conflict of values as compared to other Harapan parties by pushing its own 'Bumiputera agenda'.
It is not only that non-Malays have been excluded from civil service and GLCs, but a single-race-based nationalist socioeconomic model itself is a threat to greater national unity.
Will the Malay-nationalist socioeconomic model be able to keep the Malaysian federation intact forever? Malaysia needs the best technocrats to run the country regardless of race, creeds and ancestral origin.
Nationalism is needed when the country faces an external intrusion, invasion or colonisation. After 60 years of independence, Malay nationalism has predominated the socio-economic development modelling that Mahathir has steered for more than one-third of its existence.
It is nothing more than a form of self-pity nationalism for race-based domination that would not bring the country forward, but only backward.
DR BOO CHENG HAU is the former assemblyperson for Skudai.
The views expressed here are those of the author/contributor and do not necessarily represent the views of Malaysiakini.
