Towards a high income economy.

You can't avoid this. The high income economy is predicated upon a knowledge-based economy. India has emerged from the status of a basket case because it producers engineers, technicians by the thousand per year. It has so many engineers per given population. So many doctors per given population.

The question then is: Has the government thought about that enabling infrastructure that will propel this country into a high income country? Define at what level of GDP? What level of manpower achievements? How many doctors per given population; how many engineers/population. Etc.

Think of how many people we want to train at PhD levels in the sciences and engineering. That's the cutting edge. Not too long ago, the then minister of higher education I think- Khalid Nordin was saying we are going to produce many at doctorate levels? Would be interesting to see in what fields. It's the quality that counts.

India produces some 500,000 technical graduates a year. Even if 30% of them are of quality material, that's still a sizeable number. Malay students must be encouraged to excel in the hard sciences.

With our current GDP, at which level are we at? We are hardly above the low income level. Between the slightly above low income level to that utopian undefined high income, exists a large void? What do you fill hat up with? You need a middle income level.

Now, that's a tricky part. You have a middle income trap; we have a corresponding middle class trap. The middle class trap with a rent seeking mentality that isn't about to give up its pleasurable position when the PM wants to open up the economy.

Why should they? You have created an environment where this middle class rent seekers are comfortable, get pink forms (most wantonly during Anwar Ibrahim's tenure as finance minister) ,Nob-hilling and hobnobbing with fat aristocrats,- would they want to give up these perks? They want the good life- but it is the good life given to them on the backs of others is that lifestyle they want to keep.

The inception a middle class for the Malays was fine but it becomes a new problem- the emergence of a rent seeking class then created by policies that must be self perpetuating. It is the rent seeking class that will sprint into action when it sees its interests being threatened.

This rent seeking class at present has as its chief spokesman and justifier, people like Ibrahim Ali and the officiously and artificially minted professors and academicians paraded by the rent seekers as their intellectual paratroopers. Hence the people of MPM and Perkasa proudly lists down their academic sharpshooters who, it is claimed can dismantle much of what have been recommended by PM Najib's much touted foreign advisers.

So what happens when we create this middle class rent seekers? It first of all widens the income gap between the middle class rent seekers with the rest within that particular community.
The rate of wealth accumulation of the elites is faster and more compounding than that for the masses whose earnings will be eroded by inflation and other factors which naturally arise from an economy artificially propped by such policies.

I wasted no time and asked the Oracle his thoughts on the PM saying he will announce the NEM in 2 stages. I asked the Oracle, what he thinks of this portioning of the announcement.

The government is testing the waters. Allowing it some escape exit to make adjustments. They called it taking time off to get feedback from the people. They should have gotten feed back before, not after the reports are completed. Having spend a large amount of money on acquiring an economic blueprint, the government isn't about to allow the report to collect dust. But that is not good. You are sending wrong smoke signals. Your plan has some inherent defects.

The main problem we are facing now is a crisis of confidence. Our people have low confidence in the government managing the state.

Was the PM spooked by Ibrahim Ali and his people?

Not really, but it did force the PM to rethink.

Maybe the PM is a victim of faulty and half baked advice. We don't know who is advisors are. Who recommended the economic advisers?

Here is a general perception. PM is handicapped by his advisors. There are reports which get louder everyday- that PM's office with people who are more adroit at their golf games than giving proper advice to the PM. Second, these people are not just up to the mark. When you are insecure, beholden- you hold back. You become compliant, submissive by nature and serve to merely nod in agreement at whatever the PM says. You are just sycophantic cheerleaders.

The PM must have a good leadership team. This requires good people. Not necessarily agreeable but uncompromising in their assessments until proven wrong. This is the leadership culture that is needed. These qualities don't necessarily go hand in hand with personal loyalty. Good leadership material is loyal to ideas, defend and expound then. This is what the PM needs at the moment. Personal loyalties can be rewarded by other means. In ancient times, the King will confer titles and give lands to his loyal supporters and then 'release' them to be on their own only to come to the aid of the king when he is in trouble.