COMMENT | The common mythology is that Prime Minister Dr Mahathir Mohamad came back from the “twilight of the gods” to save Malaysia from the kleptocrat Najib Razak. Methinks he has a bigger agenda, an agenda that had been skewed by his successors, former premier Abdullah Badawi and then Najib. Who would have missed the fact that his attacks on his successors had started from the moment Badawi did not follow his agenda?

His recent adverse remarks on Khazanah Nasional Ltd and how it has deviated from its original goals of temporary ownership of companies on behalf of bumiputeras has raised new fears that he is going to privatise Khazanah and take us back to the days of Mahathir-style crony capitalism.

We hope he will prove us wrong…

The father of neo-liberal capitalism in Malaysia

There is no dispute that Dr M is the father of neo-liberal capitalism in Malaysia. As soon as he became prime minister in 1981, he set about promoting a wave of privatisation drives that were in tandem with the neoliberal ideology that was being aggressively promoted by two right-wing world leaders at the time: British prime minister Margaret Thatcher and US president Ronald Reagan. Mahathir’s close business associate and economic adviser was Daim Zainuddin, who now sits as chair of the non-elected Council of Eminent Persons.

Thus, during Mahathir’s term, publicly-held assets were sold off to cronies in private business who were appointed “corporate captains”. This process naturally led to increased competition for these resources within the ruling Umno party and the factional struggles between Mahathir, Anwar Ibrahim, Tengku Razaleigh and Daim Zainuddin can be traced to fighting for the spoils of these resources. When Anwar Ibrahim took over as finance minister in 1991, he had his own cronies who controlled the Malaysian Resources Corp Bhd (MRCB) and the media companies under Umno.

Neoliberal ideology supports a strong state, not a strong state that directly provides for public welfare, but one that enables businesses and capitalists to flourish freely. The economic recession during the mid-eighties hastened the process of privatisation with the passage of the Promotion of Investment Act 1986 in order to open up the economy to private investments. Soon, one state sector after another became corporatised and then privatised: Telekom in 1987, followed by Malaysian Airlines (MAS), MISC (the shipping corporation), TV3, North-South Highway, Pos Malaysia, the electricity board (TNB), the railways (KTM) and Hicom (heavy industries).

While there may have been a case for privatising loss-making state agencies, profitable industries such as Telekom were cherries ripe for the picking...