Imagine there is no NEP

The NEP brought good as well as bad. But all in all, given the circumstances, it was not a complete success, nor was it a complete failure either. The question is whether the NEP is sustainable in it's current form. Any affirmative action requires substantial resources from the government, country and society.

Again, the fundamental enabler rests on the economy and the wealth of the country. In Malaysia, the government can give preferential treatment to the Malays in education, business, jobs, housing, etc. To do that, the government will need to increase taxes, cut subsidies, and of course use the income from resources such as oil. Whether we'd like to admit it or not, these come at the expense of Non-Malays and the country's resources. The reality is, we have managed to come this far because of oil revenue. But as the population increases, logically, so will the amount needed to run the country.

We are already seeing the symptoms in the form of limited places in universities, inadequate schools, hospitals, bad maintenance of public amenities and infrastructure like roads, parks, water, fuel, etc.

Malaysians will need to somehow come to terms with reality. When the people are fighting to get their hands on their share of the pie, conflicts are unavoidable. But humans by nature are prone to be selfish and greedy. Politicians want to grab as much power as possible. Businesses want as much profit as possible. Employees want as much salary as possible.

Regardless of the policies or solutions, somebody has to carry it out. It's those who are responsible for implementing them that matters. Do we have the right people for the job? Does society itself possess the right mentality and values?

NEP would still have happen one way or another.

Any suggestions for an alternative form or modification to the existing NEP is akin to abolishing it. The alternative must be in place first before attempting to modify or change the existing NEP itself.

NEP or not, it will be up to the beneficiaries, which are the Malays themselves. Whether the Non-Malays can live with this will depend on themselves. Even if the government abolishes NEP tomorrow, do the non-Malays naively expect things to be completely different without the cooperation and acceptance from the Malay community?

Just as the non-Malay's contribution to the economy have benefited and helped uplift the country and the Malays, the non-Malays too will benefit from the progression and development of the Malays. Malaysian society is actually more inter-connected than many care to admit. Like a house of cards, when one falls, the rest will follow.

Today, the Malays make up a big segment of the educated, professionals, middle-class and entrepreneurs. Just like everyone else, they too want the country to progress and move forward. But without trust, it will not happen.

As long as each community knows which lines should not be crossed, trust can be nurtured, and good things will happen. And with a needs-based social safety net in place, distrust and insecurities will be eliminated. However, at the individual level, we can always choose to forge ahead instead of waiting.

At the end of the day, it's has always been hoping for the best and preparing for the worst.

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Imagine there is no NEP

Wong Chin Huat

Published: 23 October 2014

For many members of ethnic minorities, if there is no New Economic Policy (NEP), then all the people will be living in peace.

The reality is more complicated than this. Doing the NEP may just do away state partiality, but not socio-economic inequality. And we need an alternative to do away both.

What’s wrong with the NEP?

Many people like to argue that the design of the NEP was good, only its implementation was bad. I respectfully disagree.

For me, the intention of many – but definitely not all – to have and support the NEP was good, but its design and its implementation were flawed.

The road to hell is paved with good intentions, if you like.

So, what’s wrong with the NEP? The NEP was flawed in three ways.

Flaw 1: statist assumption

First, like all statist projects, the NEP was based on the assumption the state was benevolent and selfless, and had no mechanism to check the “agency problem” of its executors.

The very core idea of the NEP, which was firmly planted in 1946 and lives on after its technical conclusion in 1990, was that state partiality can check the excess of socio-economic inequality. Unfortunately, even in pragmatic sense, two wrongs don’t make a right.

Prime Minister Datuk Seri Najib Razak just claimed that Bumiputeras only effectively controlled 10% of corporate share.

And according to Dr Muhammed Abdul Khalid in a 2002 article titled “Anti-poverty plans are colour-blind”, the poverty rate for the Bumiputera was 5.3% as compared with that of only 0.6% for the Chinese.

Even when comparing the bottom 10% of each ethnic group, the Malays’ average household income was only about 70% of that of the Chinese.

The simple question to ask: how can the powerful NEP state fail to help the Malays, both in building a competent and self-reliant capitalist class and lifting the Malays out of poverty after 45 years?

Has the state done all it can? Or does it fail because it has not extracted more from the minorities or hold them back enough? Or is the failure caused by some sabotages by the evil Jews and the evil Americans?

The more convincing answer to me is misplaced incentives.

First, economically, the uncompetitive nature of Umno’s electoral one-party state allows the ethnic champions and guardians to steal what they are supposed to protect. If you can only count on me to advance your interests, what don’t I take a cut?

Second, politically and most detrimentally, the economic independence of Malays will gradually eliminate the political dependence of Umno.

Think of it this way: if ghosts are forever gone, ghost-busters will be out of job.

Similarly, if a cat is kept fundamentally to catch mice, then the cat must be able to catch enough mice to impress the masters. However, if the cat eliminates the mice population, it will be the victim of its own success. As its usefulness end, all its mistakes and nuisances may become intolerable.

Flaw 2: mono-ethnic support

The second flaw of the NEP is that it has no real cross-ethnic support. In the aftermath of May 13, the non-Bumiputeras basically swallowed the NEP down the throat as the price to restore peace and avoid more ethnic violence.

Even when the economy is good, the minorities support for the NEP and its successor policies is at best lukewarm and half-hearted. Unable to overthrow the policy, the minorities skirt around it with schemes like Ali Baba partnership.

Those who feel strongly alienated respond with brain drain, capital flight or supporting the opposition. Some even privately discriminate against or belittle the ethnic majority as an everyday form of resistance.

This frustrates both the state and the Malays, which respond with more discriminative policies against the minorities. Malaysians are like crabs in a basket – trying hard to pull each other down from climbing out of it.

It’s unfair to blame the NEP’s mono-ethnic support base solely or mainly on the state or the ethnic majority. It’s our collective karma, going all the way back to our failure to build a really inclusive notion of nationhood after decolonisation.

But the harsh reality remains: an economic problem cannot be resolved with authoritarian political means.

Flaw 3: violence as the guarantor

The third flaw of the NEP has got everything to do with its origin: the May 13, 1969 riot. It was installed with violence and any attempt to remove it even through democratic means is responded with threat of violence.

With Bumiputeras constituting a majority in some three quarters of parliamentary constituencies, there is no way the NEP can be removed without substantial support of the ethnic majority.

Yet, defenders of the NEP like Tun Dr Mahathir Mohamad object vehemently to the proposed repeal of the Sedition Act which, in practice, shelves the NEP from public debate and its replacement by other laws.

When violence is used as the ultimate backer of a policy in the “or else” way, not only its flaws and weaknesses – as the two flaws of NEP discussed above – cannot be addressed, society gets addicted to violence as a means to curb dissent and suppress difference.

Any surprise that now to “protect” the Muslims from dogs, a man’s life is threatened?

Alternative to NEP – non-statist, non-ethnic, non-violent

The NEP policy paradigm is flawed but it would be wrong to think that Malaysia without the NEP and all its flaws would be a bed of roses.

American President Theodore Roosevelt said it aptly: “this country will not be a good place for any of us to live in unless we make it a good place for all of us to live in.”

It’s true for any country in the world, more so for multicultural societies, where socio-economic inequality often correlates with some cultural divides, hence capable of turning class tension into communal conflicts.

It’s time that Malaysians to think of an alternative to the NEP. To not repeat the latter’s flaws, the new policy paradigm must have at least these three characteristics.

First, it should be non-statist by large, building the incentives into market and society to eradicate poverty and restructure society.

A rigidly stratified society, whether between or within ethnic groups, means restricted social upwards mobility for individuals trapped at the bottom. It’s not just injustice but also losses to society and economy when talents cannot be tapped optimally.

However, for a society to stay harmonious and economy to stay stable, it requires also solidarity for the least endowed to have a decent life.

Dog-eats-dog competition is not only inhumane but may eventually tear apart the social fabric in a multicultural setting.

This leads to the second point, the agenda must be national, and not communal. Socio-economic empowerment should be seen as a right and part of what the Malaysian citizenship entails, rather than a privilege based on group membership.

This will deprive any political entrepreneurs from holding any community at ransom for the empowerment that is rightly theirs.

This means a fundamental paradigm shift from “entitlement” – who our ancestors were and when they came here – to “empowerment” – where we are and where we want to go to actualise our life.

For this to work, we will need a national consensus that covers also the aspect of cultural identity. We will need to confront honestly the 1946 question, seek a real consensus and make peace.

Third, the new policy paradigm must be based on reason, the opposite of violence. This would allow all its flaws and weaknesses to be scrutinised and corrected.

Is this new paradigm possible? Allow me to paraphrase John Lennon:

“You may say I'm a dreamer
But I'm not the only one
I hope someday you'll join us
And the country will live as one.”

- See more at: http://www.themalaysianinsider.com/opinion/wong-chin-huat/article/imagine-there-is-no-nep#sthash.MYjHKRQZ.dpuf

Malaysia mundur kerana Melayu?

Is Malaysia backward (in terms of development) because of the Malays? Or more accurately, I think, is whether Malaysia would have made better progress if not for the Malays.

Frankly, I have no doubt Malaysia would be head & shoulders ahead of many of her neighbours in terms of development & economy if we did not have affirmative policies (which by the way, I think is necessary). Having said that, I think Malaysia could have also progressed much further if the Malays who received the assistance & support all these years had not squandered & abused it.

As I've written before, the economic cake is not expanding. There's not enough to go around anymore. How long more do you think the government can afford to keep dishing out billions? But most importantly is, where will the billions come from?

Let me put it in another way. The economy & the government's income has to exceed the rate of the population growth to be sustainable. But evidently, this is not happening in Malaysia. So, the government cuts benefits, subsidies & increase taxes, like what is done in other countries.

If the Malays themselves, who will form more than 80% of the population in the near future, do not grow the economy, there won't be enough to go around. If the Malays insists on depending on the government, they would also need to accept the reality that it would be at the expense of slower  economic & development growth.

SMEs have an important role in our economy. In recent years, we have witness these businesses fighting to survive, some venturing overseas due to the stagnant economy. If the economy does not grow and conditions become unfavourable, these businesses will either have to relocate to other countries, scale down or shut down. Based on some estimates, the participation among Chinese & Malays is almost 50:50. If the Malays were to grow, it'll be either through economic growth, or else, it would be at the expense of the Chinese. Guess which would be the most likely to happen.

According to the SME Annual Report 2012, small and medium enterprises represent 98.5% of the approximately 78,000 companies in Malaysia, with the remaining 1.5% made up of multinational and public-listed companies.

In many developed nations, SMEs are thought to contribute between 40% and 60% to gross domestic product and 60% and 70% of the employment, but the SME sector in Malaysia has not reached the mark yet.

Deputy Prime Minister Tan Sri Muhyiddin Yassin recently said, “SMEs in Malaysia contribute 31% to the GDP and 59% to employment. The SME sector has a lot of catching up to do as we work towards achieving developed nation status by 2020”.

(SOURCE)

Anyway, recent social & political developments have been an eye-opener for Malaysians. For the Chinese, they have come to realise that their place in this country is not as secure and safe as they thought. They have to overcome increasing obstacles in early life (education) and glass-ceilings in later life (career). Because inherently, they will never be able to fulfill the conditions imposed in order to assimilate with the Malays, which by constitutional definition must to be Muslims, observe Malay customs & traditions, and speak the Malay language as a first language. And with that, the Chinese will never be accepted as equal, just as the Chinese in Indonesia and Brunei.

Some are fighting to preserve their place & rights, and indeed they are most vocal. On the other hand, a good number of pragmatic ones have come to terms with reality, and have quietly decided that their future lies elsewhere and will try their best to give their future generations the opportunity that they and the generations before them didn't have. And to be prepared for any eventuality... Such is the fate of the Chinese diaspora... Perhaps it's time to move on... Wherever you are, just remember this:

"Observe developments soberly, maintain our position, meet the challenge calmly, hide our capacities and bide our time, remain free of ambitions, never claim leadership and avoid confrontation."

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Malaysia mundur kerana Melayu?

Dalam  buku “The Malay Dilemma”, Tun Dr Mahathir Mohamad menulis, jika kaum Cina dibiarkan bersendirian berniaga dan mengurus ekonomi negara mereka akan menjadikan Malaysia sebuah negara  maju.

Tetapi apakah Melayu hanya jadi pemerhati, kekal miskin tetapi berbangga kerana negara maju di bawah orang-orang Cina?

Atau Melayu meminta sebahagian daripada saham kekayaan negara walaupun  akan melambatkan kemajuan negara? Inilah dilema Melayu.

Imbas kembali, British perlu pekerja untuk membangunkan ekonomi dan perniagaanya di Malaya. British tidak mahu menganggu budaya dan agama orang Melayu kerana adalah dasar British, lalu membawa macsuk orang-orang Cina untuk bekerja dilombong bijeh, pekerja dan berniaga. Kaum India juga dibawa masuk sebagai  pekerja ladang dan buruh kasar.

Jika tidak berlaku krisis ekonomi dunia pada tahun 1930an,  yang menjadi punca British menghentikan pengambilan pekerja imigran,  besar kemungkinan jumlah Cina dan India mengatasi jumlah orang Melayu hari ini

Sedikit jumlah orang Melayu bekerja dengan British, terdiri dari kalangan anak-anak raja dan golongan bangsawan Melayu sebagai pembantu kepada pegawai-pegawai British atau sebagai kerani di pejabat.

Majoriti orang Melayu  selesa dengan sektor tradisional menjadi petani dan nelayan.

Setelah Malaya merdeka dan bangsa Melayu mengambil alih tugas British sebagai pentadbir, bidang ekonomi dan perniagaan seperti perusahaan makanan, pembinaan, perlombongan, getah, pemborong dan peruncit telah dan terus dikuasai orang-orang Cina yang kebanyakannya  menetap di kawasan bandar, pekan dan pelabuhan.

Di mana silap?

Penganalisis ekonomi berpendapat, dengan jumlah orang Cina yang telah menceburi bidang perniagaan dengan faktor kerajinan dan kegigihan mereka di samping kekayaan sumber asli negara sepatutnya telah menjadi negara termaju dan terkaya di Asia Timur.

Tetapi ia tidak berlaku. Di mana silapnya?

Ramai cendekiawan dan usahawan Cina percaya jika Dasar Ekonomi Baru (DEB) tidak perkenalkan pada tahun 1972,  Malaysia telah maju setanding dengan Singapura dan Korea Selatan. Setidak-tidaknya  status ekonomi negara lebih baik daripada Taiwan,  sebuah negara berteknologi tinggi yang sedang meningkat.

Korea Selatan adalah antara negara termiskin di dunia selepas perang dengan Jepun. Ekonominya bergantung pada pertanian semata-mata.

Korea Selatan  kerap diancam serangan dari Korea Utara. Taiwan cuma sebuah pulau yang dituntut negara China.

Seperti Korea Selatan, selain tiada sumber alam,  Taiwan kerap diancam serangan negara Komunis China yang sehingga hari ini tidak mengiktiraf kewujudannya.

Pada tahun 70an, Singapura, Korea Selatan dan Taiwan lebih miskin dari Malaysia, kerana negara-negara itu tiada sumber asli untuk di ekspot.

Tetapi pada hari ini pendapatan perkapita Korea Selatan empat kali ganda lebih tinggi dari pendapatan perkapita rakyat Malaysia. Manakala pendapatan rakyat Singapura adalah yang kelima tertinggi di dunia. Di
mana silapnya?

Melayu gagalkan DEB

Dr  Mahathir berhujah, DEB gagal kerana Melayu yang gagalkan, bukan kerajaan yang gagal. Bangsa Melayu yang menggagalkan usaha kerajaan untuk membangunkan bangsa Melayu itu sendiri.

Berbilion ringgit dana kerajaan di suntik untuk membesarkan kek ekonomi tetapi dibazirkan tanpa mencapai matlamat DEB.

Melayu kata Dr  Mahathir masih amalkan  budaya turun temurun. Tidak berusaha bersungguh-sungguh.  Terus mengharap kerajaan memberi  tongkat. Tanpa tongkat Melayu tidak mampu bersaing dalam perniagaan dan perusahaan.

Walaupun tidak pernah berkata bangsa Melayu jadi penghalang kepada kemajuan ekonomi negara tetapi Dr Mahathir  pernah keluarkan ayat  “Melayu haprak!”

Dr  Mahathir berhujah DEB gagal kerana orang Melayu. Manakala para cendekiawan dan pengusaha Cina berhujah, Malaysia gagal mencapai taraf negara maju kerana orang Melayu dan pentadbir Melayu  penghalang sebenarnya.

Menurut Prof Ye Lin-Sheng, seorang professor Universiti Singapura,  dalam bukunya “The Chinese Dilemma”, bila DEB dilancarkan, rata-rata pengusaha dan peniaga Cina tidak yakin orang Melayu boleh maju dalam perniagaan.

“Ianya berkenaan dengan budaya dan sikap orang Melayu yang suka “berbelanja sebelum menuai hasil”.

Katanya, fenomena yang berlaku selepas DEB, peniaga Cina bukan sahaja menghadapi tekanan untuk memberi ruang kepada peniaga  Melayu, tetapi juga daripada orang-orang politik yang terlalu berkuasa sehingga membelakangkan peraturan dan undang-undang dalam memberi kelulusan menjalankan perniagaan.

“The rules became less precise because race had entered the picture” (Page 11, The Chinese Dilemma)

Peniaga Cina terpaksa mengorban sebahagian keuntungan yang boleh dilabur untuk membesarkan perusahaan untuk membayar orang-orang politik dalam bentuk komisen, kickbacks dan sebagainya.

Mereka terlalu tamak

Ayat biasa peniaga-peniaga Cina terhadap rakan kongsi Melayu ialah, “Mereka terlalu tamak” tetapi “mereka tidak bersedia untuk membuat kerja”.

Mereka tahu, rakan kongsi Melayu atau peniaga-peniaga Melayu yang diberi saham dalam syarikat mereka bukan peniaga sebenar tetapi sekadar  wakil atau proksi orang-orang politik yang berkuasa memberi lesen perniagaan dan kontrak kepada syarikat.

Dr  Mahathir menulis dalam bukunya, pembangunan dan pertumbuhan ekonomi negara akan perlahan jika Melayu diberi saham dalam perniagaan dan perusahaan ternyata jadi kenyataan.

Sasaran 30% saham bumiputera dalam perniagaan dan perusahaan gagal dicapai. Insiden kemiskinan terus membebani bangsa Melayu dan bumiputera. Akhirnya Melayu gagal dan ekonomi negara juga gagal!

Sungguhpun sudah 40 tahun DEB berlalu, sikap dan budaya orang Melayu masih tidak berubah. Bangsa Melayu masih  asyik dengan isu-isu yang berkaitan dengan kuasa politik. Isu-isu berkaitan dengan bangsa dan agama.

Matlamat menjadi negara maju tahun 2020 masih samar-samar. Malaysia berdepan dengan pelbagai masalah yang berkaitan dengan soal pengurusan ekonomi.

Kedudukan politik yang tidak stabil berikutan berikutan kehilangan majoriti dua pertiga dalam parlimen, menyukarkan lagi parti  pemerintah membuat dasar-dasar yang boleh mendapat sokongan rakyat.

Persengkitaan kaum dan agama  berlaku secara terang-terang melalui insiden-insiden seperti isu kalimah Allah, rampas Bible dan banyak lagi yang menggambar ketidapuasan hati orang Melayu terhadap kaum Cina yang jelas memberi sokongan kepada parti pembangkang dalam dua pilihan raya umum berturut-turut.

Apakah ada kemungkinannya,  bangsa Melayu mengambil keputusan “berkerat rotan, berpatah arang” dengan kaum Cina. Mengorbankan soal pembangunan ekonomi demi mempertahan politik ketuanan Melayu mereka. - SOURCE