Tuesday, 29 June 2010

Ustaz Rais and his 'parametered commission'


Parametered commission? Well, thats the term Ustaz Rais Yatim used. The title Ustaz is a recent honorary title in recognition of UMNO's stature as a party of ulamaks. This was declared by the Religious Affairs Minister, Jamal Khir. 
Billionaire Vincent Tan is most unhappy that the government has flipped and flopped over the issue of sports betting. He also laid blame on the opposition parties. In other words he is saying, the government of PM Najib was ok but for the meddling interference of opposition parties.
That's giving undue credit to the opposition parties. The millions, of all religious denominations, who objected to gambling, are not prompted on by the opposition. Gambling is unconscionable. So what about the millions of Malays and Chinese and others who objected to the licence being given to Ascot/Berjaya/Vincent Tan? Careful here- you may actually place the PM at loggerheads with voters. Maybe Vincent Tan is not aware of widely circulated printed material at Friday sermons denouncing the government's decision to grant the licence in the first place.
If the objective is to wipe out illegal bookies, then the better solution is to legalise every one of the illegal bookies. Since the Bakri MP has revealed the number of known illegal bookies, then, make them legal. On the other hand, if we know they are illegal, then why are they still in business? They should be hauled up before the law.
If we want to make it legal, make it so for every bookie operations and not just Vincent Tan's. The problem here is, almost all the government machinery is rooting in for one person- Vincent Tan. Why so? Why should he be given monopoly in getting a licence?
Legalising gambling is a complex issue. Admittedly, it is incumbent for a Muslim government to set aside provisions and facilities to satisfy the needs (cultural and religious) for its non Muslim citizens. Hence, if the eating of pork is part of the diet of non Muslims, a Muslim government is obliged to set aside facilities and land for the rearing of pigs. Muslims don't eat pigs anyway. The government allocates land in special zones so as not to offend Muslims and others who don't consume pork. If consumption of alcoholic beverages is part of the diet and a cultural need of non Muslims, then a Muslim government facilitates and licenses the production of alcohol. Muslims don't consume alcohol. If gambling is part of the cultural make up of the Chinese, then the government can also issue a licence. Muslims don't gamble.
It's a religious injunction. That being so, having a parametered commission in the words of the verbal acrobat Rais Yatim, is superfluous. If it's a religious thing, why does a Muslim require policing? Internal religious conviction should be sufficient to deter Muslims from gambling.
Now that PM Najib/UMNO president/finance minister/BN chairman has placed the final nail of the sports betting coffin, how will those who supported the issuance of licence now justify their support? Chief among them is unfortunately the former PM , Dr Mahathir. Awing Adik has earned the moniker of tauke KTM- Kuda, Toto and Magnum. Donald Lim who has just assumed the deputy finance minister's post can't possibly answer the issues properly. Chor who is now the Housing Minister and who is seen to know a lot about shady deals ( being an alumni of the infamous PKFZ financial scandal) should be able to explain. Perhaps w should ask the MCA president to explain whether gambling is part of the Chinese cultural make up.
If he can convince, then MCA should represent the gambling population and petition the government to legalise all sorts of gambling. But they must petition that ALL are given licence not just Vincent Tan. If Vincent Tan is the only one, then this is outright monopoly and its time that Malaysia has its own antitrust laws.
But I want further clarification from my favourite minister, the mode driven Minister of Information.
Tuan tuan dan puan, negaro kito sudah maju. Cubo la tuan tuan tengok- dulu air dalam sungai, maso ni air sudah ado dalam bosi, api pun ado dalam kaco, potek di topi, tongah menyalo, mengapo kapa bosi tak tanggolam, den naik heghan. Tapi rakyat masih tidak bahagio. Kojo apa? mato mato, pangkat apo? Sajen mejo. Pii kojo naik apo? Lenrobo tuo.
Dah naik jobo ekau ni. Den sekeh kepalo kau kang....
Just what is a parametered commission? I suppose it's a commission being told what it can and cannot do. In other words, it's a neutered commission.
If that is so, can we have a well parametered commission that would do much to reduce illegal prostitution? I don't know what is the contribution of this thriving business to Malaysia's GDP. It may be part of the service business which is probably included in the PM's liberalisation of the service industry. People are coming to Malaysia now for their sex holidays. That surely is an indication, it's a burgeoning business. That would surely warrant a parametered commission.
So let's have a parametered commission. I don't know what Rais means when he said this. Probably, he has in mind the setting up of a commission, pro gambling of course, that would ensure conservative Malays do not gamble.
But wait, why is he supporting an industry which the PM has said in unequivocal terms, he is not allowing a license for? Where will Rais put his face after his boss has rejected this concerted rear guard attack on anti gambling forces in the country?
But there is actually a hidden reason why Rais has chosen to become the spokesman for sports betting. Before I forget, let's not forget that Rais is also an ulamak as defined by that ex general who has become a minister in charge of Islam in Najib's cabinet. Ustaz Rais has revealed to us that the value of sports betting is around RM 10 billion a year- that's 10,000,000,000. The government needs to tax this valuable economic resource to finance its welfare activities.
Will Rais press for a parametered commission to determine the application of tax income from sinful economic services?

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Monday, 28 June 2010

Sand for Bridge?


Last year, minister mentor of Singapore, Mr. Lee Kuan Yew visited Malaysia. He paid a visit to Kelantan’s Nik Aziz. He met up with Datin Sri Rosmah telling everyone that she and her husband our PM, run the country as partners. He also visited my state, Pahang.
In Pahang, he offered Pahang the technical and capital assistance for the state to dredge the Pahang River in Pekan. He said Singapore can do the job in return for sand. I was thinking, Singapore was willing to do the extensive dredging works in return for sand? Every grain of sand must be worth its weight in gold. 
Sand.
What is the most precious commodity that Singapore wants? The firm answer is sand. This has been the bane of any agreement between Malaysia and Singapore. Dr Mahathir, when he was PM was adamant not to include sand as the lubricant to smoothen any agreement with Singapore. Singapore on the other hand, needs sand from Malaysia to increase its land mass. But by doing so, it will decrease the marine boundary it has with Malaysia. That was absolutely unacceptable to Malaysia and to Dr Mahathir.
In my mind then, the only cause that could explain the speed by which the agreement is concluded between Malaysia and Singapore is that sand has been included as an inducement to get Singapore to agree.  This could be a very strong reason that can explain the speed with which agreement with Singapore is reached.
So Syed Hamid isn’t going to be too unhappy about not getting the chairmanship of Tabung Haji. He has business in sand export to Singapore which is worth much more than the chairmanship of Tabung Haji.
Singapore on the other hand does everything with a winning mentality. If it can exact the harshest terms even from a traditional friend, it’s done in the name of business. It’s unlikely that Singapore is willing to agree with Malaysia if it doesn't acquire some valuable assets and concessions.  It’s always bottom line reasoning. Nothing personal.
Consider the sudden magnanimity of Singapore in lowering entry toll into the republic by 30%. Why was it done? Let’s play around with the possibilities. First, I am sure; it isn’t done in the name of charity. It’s done for a purpose.
The only purpose I could think at the moment is to encourage the gamblers in Malaysia to enter and play at their new casino. Singapore doesn’t want its citizens to gamble. It knows it’s bad for society. Singapore wants disciplined and focused citizens. It doesn't want broken homes on account of gambling. Malaysians, Indonesians – yes, they can come in droves and let them gamble and lose money in Singapore. Indeed, we (Singapore) can assist them by lowering our entry toll by 30%. Singaporeans, if they want to gamble, have to place a hefty deposit at the casino’s entrance.  That’s sufficient deterrent for Singaporeans.

So what could possibly cause the Singaporeans to have such a charitable frame of mind? It could only be sand.
The sale of sand must definitely feature in the agreement inked between PM Najib and BG Lee. The sale of sand to Singapore is attached to the bridge deal.
Malaysians are entitled to know whether any agreement concluded was contingent upon Singapore getting the sand it needs to do their land reclamation. In return they will agree to the building of the new bridge to Singapore. And the reclaimed land, which will be done on the Malaysian side of Singapore, will not only substantially increase the land area of Singapore; it will also reduce the sea area and push back the common boundary closer to Malaysia. This means part of Malaysia’s sea zone (or whatever you call it) will now become Singapore territory.
If agreement was reached in this manner, what Singapore has done is, do a Don Corleone on Malaysia- make Malaysia an offer it cannot refuse. Sand for bridge. Even dismantling the ancient causeway. The causeway isn’t going to be a threat to Singapore’s economy anyway. Its economy is not dependent on physical resources but the application of human capital on physical resources. If Malaysians get their hands on physical assets, it will be years before they can become competitors to Singapore.
So, give us the wretched sand, we give you the bridge you want. You don't even have to build a crooked one- do a straight one. We are ok with that. We just want your sand.

Now, here’s a vexing problem. The POA was thought of during Tun Mahathir’s time. Essentially whatever agreement is reached; it is reached covering the elements laid down in the POA. The POA was managed by Tun Daim Zainudin who had the blessings of the PM then and the cabinet. So it’s wrong to say, that Daim negotiated the POA elements without the approval of the PM or the cabinet. The 60:40 division indeed was a compromise to what Dr Mahathir wanted and Lee Kuan Yew insisted. Dr Mahathir wanted 70:30 while LKY wanted 50:50
Indeed if agreement on all outstanding issues is reached, we need to know the agreement on the use of our air space, the question of Malaysian’s CPF. It's not just bridge, water and KTM land. Sand wasn't part of the original equation. So, if the present agreement included sand as the sweetener, I am not sure how Tun Mahathir is going to see this.
Sure, we may say, Dr Mahathir is no longer PM and he is but a toothless tiger. But we must remember, the same toothless tiger was the one who expedited the inglorious exit of one Abdullah Badawi. Now, Pak Lah is spoken in terms of Abdullah who?
Should sand stand in the way of neighbourly relations? Should sand stand in the way of good business?

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The M-S Bridge


HRH the Sultan of Johor has publicly asked the government to reconsider construction of the infamous crooked bridge. Some bloggers have joined in the call on the government to do so. The bridge was conceived by the 4th Prime Minister of Malaysia. PM Najib said, he will look into it.
When Dr. Mahathir mooted the idea, he wasn't just motivated by commercial impulses, i.e. some contractors will get rich with the project. The same will happen if the bridge is approved by PM Najib. DR Mahathir was also motivated by strategic reasons. We aren't sure if this is the case with PM Najib.
You can already see the contrasting approaches between the former and present PMs. Dr Mahathir was all for the agreement and details of transaction with Singapore be made public. PM Najib prefers doing things on the quiet which is discomforting to Malaysians in general. No disrespects to Singapore, but ordinary Malaysians have this perception that in making deals with Singapore, they are always steps ahead. With a reticent and prone to reversals and retractions PM leading our country, we aren't sure what PM Najib has got himself into.
Will the PM consider this royal call? It all depends on the agreement ratified between the PM of Singapore and Malaysia recently. Until details of the agreement are made public everyone is in the dark. We wish our PM is forthcoming in the details of the agreement. The devil is in the details.
Otherwise, this muted treatment of the agreement will be treated with suspicion. What took ages to be resolved can be settled in a few hours meeting. OUR MPs must ask the question and the PM cannot NOT answer their questions in parliament.
The POA inked by TUn Daim included certain outstanding items to be resolved. The basis for resolving the issues is of course the handling of the KTM land in Singapore. In all the land is 271 hectares in size which is about 654 acres. In exchange for developing the KTM land in accordance to the host country, all KTM activities will be relocated at a new mega terminal in Woodlands. That new centre is expected to be completed in 2011.
The 271 hectare KTM land comprising of lands in Tanjung Pagar, Kranji, Woodands and 3 lots in Bukit Timah will be jointly developed by a company known as M-S Pte Ltd- I suppose its Malaysia-Singapore Ltd. The company will be divided on a 60:40 ratio; the former being Malaysia's interests held upon trust by Khazanah Malaysia. I want to term it upon trust signaling that always, whatever Khazanah does, it's done for and in the interests of Malaysia. Lately, this basic idea behind mandates given to Khazanah seems to be violated at every turn and corner.
Now back to the original question to which PM Najib has said he will look into it. To my mind the crucial link will be in the construction of the Rapid Transit System (RTS) which will link Woodlands and Tanjung Puteri in Johor. Where will this RTS traverse? If it is build using the existing causeway as the land link, then, the answer as to whether the century old causeway will be demolished is academic. It will not be demolished if the RTS is build using the causeway as the link.
How will we solve this problem if PM Najib heeds the call by HRH Sultan of Johor and Johoreans in general? The possible solution I guess is to build an underwater channel linking Johor and Singapore. That will allow the causeway to be demolished and a new bridge constructed to link the two countries. But lets hear what engineers say about this.
Who will manage the new WTCP at Woodlands later? If it's done the Singapore way, it will be run purely on commercial principles with a view to profit making. Looking at this positively, it will galvanize KTMB into adopting a new business culture which hopefully will discipline KTMB into operating more efficiently and profitably. 
But, it will have to pay hefty service charges to the WTCP. It will make profit purely from operations as there will be no more assets to parlay with Singapore Inc.
Let's watch what happens.

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Sunday, 27 June 2010

Bakke’s mission at Sime


Nowadays I am less inclined to needle Musa Hitam for the debacle at Sime. His position is ceremonial anyway. He isn't at the driver's seat. Sime is Zubir's Sime not Musa's Sime. Most of the calls urging Musa to resign came from quarters who still think Dr Mahathir is PM of Malaysia. When I first wrote about this matter, immediately after Musa held his forum with bloggers- I asked the entire board to resign. Not just Musa. Musa can't be made to carry the burden alone.
So we can't be selective as to who we want to resign. If Musa resigns, the entire board must also do so. It's the moral thing to do. Zubir, because he is head of the management committee or team, should be joined by the entire management team. That includes Azhar who succeeded him briefly and right down the front-line managers who are part of Sime's business that fumbled big time.
Sure, Tun Musa is not going to escape unscathed from this fiasco. The board has already done the right thing by asking Zubir to go. He was head of management. It was he who manages the company. The board's role was supervisory and only acted based on the information the management committee provides. They take a foolish stand if the management provides them with silly input.
I am going to repeat my best wishes to Dato Bakke who has assumed the post of CEO for Sime Darby. He has been endorsed by the PM and Musa accepted this endorsement. I also wrote that we shall have to wait whether Bakke can do a good job. His part is also checkered- Tabung Haji also lost money and Felda lost a lot of cash by going into silly spending binges. We must support him as long as his capabilities do extend beyond expediting Hajj pilgrimage tickets and placements for senior ministers. I happened to be in front of someone a long time ago, when Bakke phone in to tell the Hajj tickets and documents are ready.
I am not inclined to be too harsh over Tun Musa Hitam. That despite knowing he flies here and there on first class on chartered planes. Most government ministers and heads of GLCs do that too. If we want to be consistent- ask everyone to fly business class on normal airplanes. Then we can hantam Musa Hitam for flying the way he does. He is after all a former DPM. When Sime agrees to fly him the way he does, they acknowledged his stature as a former DPM and chairman of Sime Darby. Sime Darby makes millions and you want its chairman to fly economy? What do you call that? Pompous humility?
But no one discusses the role of the management committee, that manages the company and front line managers on a day to day basis. What have they been doing? We should be scalping their heads too.
One thing Bakke must do is not to constraint himself at looking at Sime's failure in the Energy and Utilities division only. He must take this opportunity to look at everything across the board. Look at Sime's core business- the plantations. Without this core business, Sime is nothing.
He must begin by placing those really talented in that field to head Sime's plantations unit. I hear fruits remain un-harvested because of labor shortages. That translates in lost revenues. Lots of them. He must looked at the reasons behind the dismissal of people like Razidan Ghazali, Mohan Abudllah and Anhar Suki. If these people were kicked out by the gone-on-extended leave Zubir's for lame reasons he must reconsider them for re employment. They probably can add value to the plantation business. I am not sure their dismissal was with merits because if I remember correctly, they brought Sime to court and Sime was made to pay compensation. That can only suggest the dismissals were without merits other than Zubir wanting to create his own fiefdom.
It was all Zubir's management. Not Musa Hitam. It was Zubir's Sime and not Musa.
MOhd Bakke should seize the initiative and set up his own technical audit answerable to him to look into Sime's questionable business deals. For example who ordered and approved the RM 250,000,000 renovations at KLGCC? Bakke should ask Tengku Badli from Property Division to explain. Then, look into Sime Property Business too.

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Saturday, 26 June 2010

The Islands and the License


And what did Musa Aman say on 5 th May "Sabah has not ceded any of its territory in the Federal Government's agreement with Brunei over the 2009 demarcation of maritime boundaries, Musa even said state Attorney-General Datuk Roderick Fernandez informed him that no Sabah territory was ceded under the agreement inked towards the end of former prime minister Tun Abdullah Ahmad Badawi's term in office."
In the case of the cessation of certain islands belonging to Sabah vs. the people seeking the truth; there are two questions here. At the signing of the agreement in 2009, wasn't Musa present at the ceremony? If he was, then he has direct information about the contents of the agreement. Accordingly, he didn't have to say the state AG informed him. The phrase is suggesting that Musa Aman, as chief minister of Sabah wasn't present at the signing of the agreement or if he was, wasn't paying attention.
Not good for a chief minister. One who doesn't pay attention about what's being signed. If the whole of Sabah were ceded, would he say those words? That he was informed- something of an after the fact. A minister who isn't paying attention especially at something which is being signed involving his state or state assets should be sacked from his job.
How then can you explain the longevity of Musa Aman? He is known locally in Sabah as the vacuum cleaner and by that, I imagine, that he sucks in all money making enterprises in Sabah. I don't know, Sabah people have to tell us.
If everyone on the street has nothing good to say about Msa Aman, how is he able to stay on in power?
The only explanation I can give is that Musa Aman somehow manages to channel feel good impressions about him to the PM. It is increasingly becoming public knowledge that PM Najib is easily influenced by information channelled to him by a close circle comprising of close friends maybe, some aides maybe and so forth. You know, in the application of Goebbels principle- if you tell a misinformation big enough repeatedly, the recipient of that misinformation will believe it to be true!
In this particular case, I hear Musa Aman is handsomely rewarding some officers and aides close to the PM to say all and everything good about Musa Aman and all bad things about Musa is just the work of envious parties.
There is another lingering puzzle. That the islands have been ceded to Brunei is already a fact known to all. What the state AG said at the end is interesting- if no islands were ceded at the agreement inked by Abdulah Badawi, which cessation we know now is a fact, when was the cessation inked? Was it done during the premiership before Abdullah Badawi then?
Let's now talk about the malleability of our PM. Musa Aman is shrewd enough to form the correct opinions regarding him with the PM. As a result he acquires longevity.
The lesson? If you apply enough pressure through the correct means, the PM will override his own decisions.
Vincent Tan said he was given the license. The MOF said it didn't issue the license. If no license was issued, there is nothing to withdraw and nothing to discuss about the issue at the UMNO Supreme Council meeting on Friday.
But the PM said the withdrawal was supported by members of the UMNO supreme council. Najib said the government had earlier agreed to issue the sports betting license but with strict condition such as banning Muslim involvement in the activity.
Vincent Tan was right after all- he was indeed given the license. That was why he informed the SC in clear terms.
The phrase, UMNO supreme council members supported the withdrawal means that a license was actually given out to Vince. You cannot withdraw something that hasn't been awarded can you? What's there to withdraw?
Indeed there is no law that warrants the state to compensate Vince for his losses on paper- but equally there isn't any law that says you can't compensate him either. It's discretionary.
But will that mean, Vincent Tan will not donate any of the RM 500 million to his charity? And by the way, did anyone bet whether the license will be withdrawn or not?
Here is another piece of statement coming from an airhead of an UMNO leader. The Cheras Mafiosi. He said:
Beliau berkata, jika lesen tersebut dikeluarkan bermakna kerajaan mampu mengutip cukai sebanyak RM500 juta dengan taksiran potongan 25 peratus. "Jumlah tersebut boleh digunakan oleh kerajaan untuk menyediakan pelbagai kemudahan prasarana untuk rakyat terutama bukan Islam," katanya. Jumlah itu juga katanya membolehkan kerajaan membina atau membaik pulih sekolah-sekolah Cina yang sedia ada.
Extending the logic of his statement, then on account of the bigger amount of taxes collected from non Malays, more money should be allocated to non Malay interests then? This Syed is advocating the application of a variation of Marx's dictum; from Malay money to Malay needs and from non Malay money to non Malay needs. What does that make him? Syed Karl Marx?

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Friday, 25 June 2010

Malay Economics and the wealth distribution machinery



 
The list regarding who and which companies get what on preferential and secretive sweetheart terms is not exhaustive. It would require a major study by itself to inform the public. It requires super sleuthing work and willingness from sources to reveal facts. These are becoming harder by the day.
The way the government does things- i.e. managing the wealth distribution machinery is questionable. The same people and players seem to dominate all the big deals- Vincent tan, Ananda, Gamuda, Sp Setia, etc. the government is playing favorites to a very select few. The same fellows get the big deals. The same fellows seem to have the 'know' whats coming.
We may come out with some novel and esoteric ideas such as the Swiss challenge system. The proponent or proposer submits a project proposal to the government. The government is obliged to publish the proposal and invite 3rd parties to challenge the original proposal. The original proposer is often given the right to counter.
Unfortunately here in Malaysia it is doubtful whether the Swiss Challenge system is used in an even handed manner. Who determines the 3rd parties? - They may even be friendly associates of the original proposer who submit their challenges to make the original proposer look good. It's all a PR gimmick. I immediately recall the many cases that are happening in DBKL. One big player has 20 class A contractors under his control. He then does a carpet bombing- offering all 20 bids by his class A contractors which are manipulated in such a way so as to favor one target bidder- also his.
So, the Swiss challenge system in Malaysia, if it is adopted here very often gets lost in translation. Once it is Malaysianised, it becomes just a put on show to prove transparency.
So today, I am at a loss as to what to say about Gamuda being hopeful that its bid and offer to build some rail project for RM 35,000,000,000 will be accepted by the government. I say man old chap- don't be coy. You will get it.
In the end what do you have? You have a layered system of society, dominated by the rich elite whose wealth keeps on increasing because- it's the reasoning of successes breeding success. We forget, that the success wasn't anything organic or self created but assisted by the state. What the state does is playing favorites. So, Swiss challenge, Belgium chocs, Patchi, or whatever- it's all One BS.
The majority of business people, even whole societies have never learnt the art of becoming favourties. That 'black art' it seems, belonged to a select few.
How do you rectify the situation? How would you correct, correct, correct the situation?
It boils down to an incorruptible and determined leadership—determined to correct things. You carry out policies and actions even if you have to tweak the wealth distribution machine. Why not impose a moratorium on these tier one companies- the Gamudas, Berjayas, Tanjung whatever, Syed Mokhtar?- impose a temporary ban on them. They are not to participate in any government deals for the simple reason they have gotten enough. You think others are not as clever as them? Try others too.
So, Gamuda has come out with a plan. The government can choose to buy the concept and then holds out open tender. The concept owner is also invited of course. Do the same with the Sungai Besi airforce base, the RRI land, the Matrade land, Jalan Cochrane Land, Jalan Ampang government quarters land. You help us, we help you one.
You think no one can come up with a greater Kuala Lumpur Plan? Or redevelopment of the Sungai Besi airbase? Or the RRI land in Sungai Buloh, the government quarters land in Cochrane Road? Just advertise openly and invite bids. I tell you maybe we can get cheaper and better proposals. Just wait.
We need these doses of sanity in these uncertain times. Nothing is sacrosanct anymore nowadays. Now the Pudu Jail- because it's sitting on a valuable piece of real property. Probably some are already eyeing or re-hatching plans for the U Malaya Land, the UPM land. Later on probably, the land on which Masjid Negara stands is not beyond grab.
But again and again, it comes to having the incorruptible and determined leadership. We certainly cannot sustain a leadership which is long on nebulous ideas but short on ideas that work. Ideas that work are more important than grandiose plans which probably served to massage huge egos.
So we want to implement the NEM. Begin first by owning up to certain facts. Has the NEP failed? If it has, own up and come out with a better mouse trap. Say it boldly that in the NEM, affirmative policies are still in place, but the enabling elements- hard work, education, skills, merits must also come along. Saying so, you own up to the fact that Malays are lacking in 2 departments- they are not as hardworking or are as capable as others- maybe. It's painful to own up on these aspects but it's even more important to find ways to fortify the Malays in these two departments.
What do you need first of all? That elusive determined and disciplined leadership. Doesn't matter if it's called soft authoritarian. The Malays are more suited or shall I say more at home and accustomed to a structured and ordered style of governance. So, you have to impose discipline on them- except this time its market discipline.
You have to have consistency. If all big deals have to go through open tender process, then apply it rigorously. Once you allow discretionary adjustments, then the whole system breaks down because, the decision to determine when something comes under common open tender terms and when some come under discretionary treatment depends on personal choice. The dividing lines are blurred by personal inclinations.
How do you then obtain the position to be within the personal choice radar of the decision maker? By sending mountain-high bouquet of flowers when it's the wife's birthday or holding out some private parties for the supreme leaders. How?Maybe we have to learn from Taek Jho Low.

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Wednesday, 23 June 2010

Re- assessing Malay economics-2


Just as the NEM will fail because of the lack of determination and drive, so will any affirmative policies designed to advance Malay economics. My basic premise is this: you don't go against market forces. You don't defy them. The position of disadvantage in which the Malays found themselves, is no excuse not to adopt and acquire market forces skills- be competitive, skillful and all that. It is no excuse to justify non competitive handicaps.
This is no liberal or illiberal Malay talk. It's just Malay talking.
The sting of my argument is this. The idea is to place the Malays on the plane of economic advancement premised on competiveness elements. This is the overriding objective. If that one crucial thing that is lacking which could ensure the success of NEM is also lacking to drive affirmative policies, then they too will also fail.
Any policies designed for correcting the deficiencies will also fail, if they lack the one thing that we can't seem to find to helm the NEM.
What is the missing link? The missing link is an incorruptible, driven and determined leadership. That leadership can consist of the number 1 leader and his equally inept and beholden co leaders or even, in the case of Japan, a determined bureaucratic corp. exemplified prominently by Japan's MITI.
In Malaysia, we are dangerously facing the lack of all three!
The deficiencies of the Malays need to be corrected by an incorruptible and driven leadership. We can't run away from the fact, that Malays need structured, ordered and hierarchical style of leadership. Now I realized why people say- the age of we know best is over. It is precisely because; we DID NOT KNOW what is best. The honorable retreat is to say just that- that age is over. It is just a face saving gesture to hide the fact, that we don't know what is best. The 'what' is incorruptible and driven leadership.
These two qualities are needed in the leadership to ensure the mould by which we shape the overriding objective is followed absolutely. Once we allow weaknesses in the form of personal discretion, once you start tinkering with the overriding objective- which shortcomings stem from corruptible and weak leadership, the overriding objective falls behind.
It is precisely corruptible leadership that results in:-

 
  • IPP for YTL, Ananda,Genting.
  • Direct Nego double track rail for Gamuda.
  • LDP,Kesas,Smart,HS Dam for Gamuda.
  • Duke Hiway for Ekovest Group.
  • PutraJaya Ring Road for IJM. PutraJaya JV land development,Abdullah Hukum,Johore Roadworks direct nego for SP Setia.
  • Bandwidth for Ananda Satellite TV exclusivity for Ananda.
  • KLCC devt for Ananda.
  • West Port privatisation for Gnalingam.
  • Casino license for Lim Goh Tong.
  • 3 digits for Ananda.
  • Sports Toto,Gaming license,Bukitt Tajar landfill for VT.
  • Besraya,NPE Hiway & Seremban2 for roadbuilders.
  • Silk hiway for Sunway.
  • Khazanah rescue for Mines
Its also that leadership which saw the cabinet decision to award the double tracking project to China Railways be overturned and given to China Harbour. Ok landlubbers! people specializing in harbors taking up project usually done by specialists in their field. Only possible because of compromisable leadership.
 
So what has not been done by groups like Perkasa for example? They haven't insisted on an incorruptible and driven leadership.

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Tuesday, 22 June 2010

Re-assessing Malay Economics-1


Re-assessing Malay economics.
I am not going to offer apologies for speaking about Malay economics. This is the biggest headache. If our PM doesn't solve this problem, everything else will be on a grid-lock.
His NEM is going to fail if he doesn't have the political will and iron-fisted determination. It will also fail if he doesn't put in place a first class government machinery. 1.2 million- strong civil service isn't good if it doesn't have the quality to implement. 
First and basic of all, if he exhibits ambivalence, a dithering posture, his NEM will fail. If he has this tweedle dee tweedle dum behavior, one day this, next day that style, his NEM will fail.
His NEM is premised on market driving forces. At least, in theory he has got this part of his thinking right. The fundamental rule is- never go against market forces. The essential element of market forces is competition. A position attained is but temporary because, competition drives competitors to dislodge you. Unless of course, that eminent position was attained by non competitive means, by fiat, decree or plain legislation. In that way, prominence and eminence will depend on continued non competitive policies and maybe even coercive power instruments.
Insisting on eminence premised on inherent rights and inherent privileges for example is a clear position that is against market forces. It will fail. Insisting that NEP policies must remain, is just against market forces. Because that way, you institutionalize privilege and ascriptive norms. You institutionalize corner-cuttings, free loadings etc. most importantly, you institutionalize a non competitive culture.
You simply can't develop a country based on these elements- cutting corners, short cut to everything attitude, shyness to hard work. You can't develop a country believing it will because of who you are. I mean, the country doesn't develop only because you are Tun Razak's son, or Hussein Onn's son or Mahathir's son. It's got to be based on the bricks and mortar principle- hard work and usage of the material between your ears.
Once you institutionalize the bad habits they become culture.
Our PM must realize quickly that culture is our country's DNA. How do you re-constitute it? Not by pussy footing. It requires laser and invasive surgery. Cultures that evolve and adapt to external stimuli thrive, those that don't, fall behind. Or those that deliberately resist will fall behind. Something along the line Ibrahim Alis of this world proposed.
That is the reason , the principal reason indeed why I think the resolutions arrived by Perkasa will not be included in the NEM because they are incompatible with the NEM. Its too premature to say, the PM accepts the resolutions of the Malay Economic Congress. Not because PM Najib doesn't want to, but mainly because he knows incorporating non competitive elements will derail his NEM. But he doesn't have that courage to say no.
Which is troubling. Because it reflects his lack of that iron fisted determination and drive to see the NEM goes through. And if he abandons his NEM after spending so many man hours and money and PR-ring his masterpiece, he will certainly be categorized in the same class with the Sultan of Slumber- the accidental PM.
And so yes, culture is the issue. I have written that UMNO leaders and leaders of this country need to think about culture if they haven't done so or read about it if they haven't done so. If you put in a culture that doesn't place much value in learning and scholarship, doesn't reward a person for his intelligence and education and industriousness, you are going to slow down progress. Why should anyone try harder if he knows the next mamat who has less education, fooled around during college and at universities is going to be rewarded more? At the very least, such a person develops lifelong cynicism and disdain.
A culture that doesn't place much value at all on achievement norms( by which we measure a man based on what he is capable of doing vs. ascriptive norms by which a man is measured based on who he , his father and family is.) is bound to put in a system that is going to slow down progress.

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Sunday, 20 June 2010

Legalizing Sports gambling


I thought I did not want to write on this subject. Recently Dr Mahathir came out to support sports betting. Just yesterday, the man whose mouth is faster than his brain, the Minister Nazri TS Aziz said lets legalise the sports betting because this signifies our respects for those who like to gamble. The Chinese like to gamble. We know some ministers, UMNO included like to gamble too. We must respect them too.
So I find myself not asking anything more than what Nazri asks. Lets honour those who like to fornicate around by legalising prostitution. We must respect them. Let's allocate more land for the rearing of pigs because to do so, we show our respects. As long as the Muslims don't partake in all these. Hell, we must also facilitate the setting up of alcoholic and beer manufacturing facilities, if that beverage is required and needed for some people's sustenance.
Then if anyone violates the respects, they must be dealt with severely.
And not to miss the bandwagon, Kaveas of PPP says he supports the sports betting. Now it's becoming more interesting. Chua Soi Lek sees nothing wrong in legalising gambling. He has already reached the apex of sinning - gambling is nothing to him.
But when PPP apes what others are saying- I cannot tahan anymore. I have to write something. Now.
PPP can say whatever it wants. No one wants to listen to them. I don't know why BN should carry this living monitor lizard. To the Malay- the saying memikul biawak hidup carries with it, despicable connotations. PPP is the basket case among BN component parties. The people at large don't care what Kaveas and his speckled batik-shirted ride- alongs want to say. They can't win a single seat and has to contend with begging the PM for a seat through the backdoor. What value does PPP give to BN? Its presence causes indigestion to Samy Vellu. The truth is, PPP is more renowned by its internal squabbles than stellar leadership. That it has none.
Go on- legalise everything because as Kaveas says, our society has accepted reality. He of course means a particular section of society. The mother lode of all gambling is located at Genting Higlands. The Genting group pays more than a Billion Dollars to acquire a gambling licence in Singapore. Here, Ascot Sports was given the opportunity to make RM 575,000,000 on VT's 70% share. The son, because he is a scrooge, chooses to keep his 30% share.
What we have missed is, Ascot Sports was given the license free and the possessor of the licence was able to tell the SC that he is injecting a valuable portfolio to boost the value of his shares.
PPP has got the wrong message- we will also support the legalisation of sports betting and other gambling and gambling permutations. We don't care – but don't legalise it ONLY for Vincent Tan. Why not legalise all those illegal gambling owned by ALL operators. Then this lucrative business is not monopolised by ONE person. Will PPP support legalising all the illegal gambling if these shadow operators, apply to legalise their underground business?
Why should preference be given only to Vincent Tan?
If Vincent Tan is the only person preferred, then he must have done something very very useful to the leaders of this government to such a degree, that the leader of this country is beholden to him. So he brushes aside any opposition and any indiscretions to insist giving it to Vincent Tan.
What has Vincent Tan done to this country which cannot be done by others IF given the same opportunities? VT wasn't successful in all his ventures was he?
What we are currently seeing is the mounting of a concerted rear guard attack to destroy all opposition to granting the license. This could suggest that the licence has actually been given by the MOF.
What's troubling us over the sudden rear guard counter attack? It is this. I quote extensively from this blogger who commented on my blog.
The Ascot-Vincent Tan licence is a monopoly licence, given, without competition, and on the quiet, to an individual who is already enormously wealthy after another such licence in the past. No terms have been made public. No safeguards in place to protect the public's larger interests. No one knows what political quid pro quo have been negotiated.
There is also the question on the morality of a government which, acting on behalf of all the people, gives away to its friends and allies valuable things that belong to all the people. And of how it leaves the common people short-changed, and tries to make a virtue of it.
It is only pragmatic to accept that gambling will exist in a pluralistic society, and if left unregulated will only feed the underworld. That calls for licensing, but with strong conditions to ensure that the common good is served, and not made a means to line the pockets of the wealthy or of the powerful.
It will indeed line the pockets of the wealthy if legalising it confers a monopoly by businesses held by ONE person.

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Bakke’s credentials



 

Who are we to argue if the PM says Mohd Bakke is right for the job at Sime Darby? He has the right experience and possibly temperament too for the job. He has plantation experience, corporate re structuring experience and experience managing large corporations. Yes sir, picture this- mohd bake hauling bags of over charged fertilizers and carrying the harvesting sickle to harvest fresh fruit bunches.
I am not going to take away anything from the man. Maybe he's good or bad- which needed time to prove or disprove. I wished all him all the best.
When was he part of the managing team of Felda Holdings? From 2004-2008? Well during that time if he led or was part of the  senior management team at Felda Holdings or Felda Ventures or whatever, -that was the time when Felda's cash reserves dropped from RM4.3 billion to whatever it is today. 
Today, perhaps it has no cash reserves although that diminutive deputy minister wak Maslan says, oh..It dropped by just over RM 2 billion. He then provided a breakdown in the application of the drawn down reserves. His explanation was hotly contested because most of the expenditures he cited should have come from opex or categorized as OPEX.
If that is so, then we can expect deeper troubles at Felda because people there are confused as to opex and opex and cash reserves.
Sure Bakke may have the experience indeed- part of the team that oversaw the reduction of Felda's cash reserves. Which team?
But the papers also cited that Bakke was part of the managing team at Bank Islam. Ahlan wa sahlan wa marhaban bikum ya sheikh!
Was Bakkee part of the team at Bank Islam that saw it made losses of RM457 million. This RM457,000,000 came about as a result of Bank Islam making bad loans totaling RM 774 million? During which time Bank Islam had an NPL portfolio of RM 2.2 billion- that's RM2,200,000,000. Let me amplify that: - 2,200,000,000
By consensus, this financial debacle was due partly to mismanagement and poor internal controls. But more probably it's due to years of regulatory apathy fuelled by the misconceived notion of an untouchable Bank Islam because it was a favourite child of the Malaysian government. It was the first and model Islamic bank in the country and region. Islam is a perfect cover to hide misdeeds. The reality was, Bank Islam had a reputation in the market for being the spoilt child of the Malaysian Ministry of Finance; and the perception of the bank was more of a Muslim financial fraternity or government development financial institution.
You know the perception that whatever is done inside Bank Islam must be sanctioned.
But perhaps, the Bank practised ..wa haram-mun kalau makan sorang, wa halal-lun kalau kongsi sama.

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Saturday, 19 June 2010

Saturday sports- but no betting please.


I have written about this sports betting thing a few articles ago. I said, this sports betting licence has made the vendor RM 525 million richer. That's RM 525,000,000. Six zeroes. You are likely to strain your eyeballs keeping track of the many zeroes.
How do you explain the government's willingness to approve the license first, to Ascot Sports which then sells the license to Berjaya Sports TOTO? Wasn't this SPORTS TOTO the company once owned by the government which Dr Mahathir sold to Vincent Tan in 1985? Wouldn't it be more proper if the license be given to Berjaya Sports Toto. Instead its sold to Ascot Sports owned by Vincent Tan( 70%) and his son Robin 30%. So our friend VT sold his 70%. Hurrah! ( Exclaimed in the manner of Prince George in Black Adder)
What about the 30%? The father is more charitable. The son is no so. That has only added fuel that perhaps the son is holding the 30% for someone else. I am not able to write this up in a more spirited and satirical manner. The blogger who is a maestro in doing this kind of writing is Donplaypuks. Go read his blog with an open mind, respect the fact and his freedom to write for the opposition.
Vincent Tan would have been more charitable if he had given the licence back to the government and even better, gives back Sports Toto. It hasn't been making money so why bother anyway?
But it is the drama surrounding the issuance of the license that has proven to be more interesting. The hunt is more adrenalin rushing that the actual shooting. The foreplay is more exhilarating. Vincent Tan told the SC he has been given a license. Everyone in Malaysia were up in arms. Friday sermons condemned the issuance of the sports. Even UMNO people were against it. The MB of Johor was against it. Some UMNO people in Melaka have openly condemned it. Tamrin Ghafar writes a scathing personal letter against it.
Other than the condemnations being directed at the sports betting license itself- these are actually defiance directed at the UMNO president. Which suggests that despite having a 72% approval rating, his approval within UMNO is challenged. In any case, his 72% approval rating is evinced from the jobless who if I may say so, have little inkling about the seriousness and complexities of governance. It's definitely more than putting up a smiling face, trying to look pristine and saintly or operating a face book brother!.
By the way, I hear my and your PM is inviting people to name his cat. Wow- just like a previous American President. Perhaps our PM was inspired after his US visit. Perhaps the people at APCO, Ethos, McKinsey or the Bolton Consulting Group say, this is a good move. Make the people feel one and inclusive. Another wow please. So, I would suggest, in the spirit of an open heart, if the cat is a male- named him TEMUJIN- so that it grows big and powerful to conquer the household and catches after the big-as-cat rats. If it's a female, suggest our PM to name it BORTE- the lady behind TEMUJIN. The people at APCO should advise the PM to do this to show that he is not afraid of anything Mongolian!
After the big hoo-haa, My Prime Minister and yours too has said that it's not complete yet. No license has been given but yet VT has told the securities commission that he has been given one. So has VT misled the SC?
Why don't we just own up- this Berjaya sports toto or whatever ruse we play along, through and with Vincent Tan and his companies is just another way to launder money which end up , with either UMNO or its leaders eventually. To make it halal and kosher, we call it welfare- kebajikan and so secure tax free status.
Everyone who are pro the sports betting license are saying legalising it will stem out illegal betting. My friend, mon ami, amigos- the illegal betting, the 4 ekor kah, 3 ekor kah or berapa ekor tak kira lah, will mushroom still. They will because they are not ready to allow ONLY one fellow making the money and certainly will not allow only ONE government to legislate a license and conspire with ONE Fellow. This is a greater subsidy than the nonsense Idris Jala is spewing up and no, we are saying this not because Idris Jala is a Christian. A Christian can also do stupid things cant he? If he were a Muslim, I would still crucify him.
I have already asked in light of the government's willingness to issue this license to legalise also prostitution. That will reduce or eliminate illegal prostitution. We must emulate what's going on in South Africa. During this World Cup tournament, I hear the most thriving business involves balls of different kind- multi nationals and united by a common drive! In this case, Newton's secret law of motion is being played out- the angle of the dangle of the balls is proportional to the thrust of the pole at the hole, provided pressure at the breasts is kept constant.
I learnt this in UM in 1976!

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Friday, 18 June 2010

Deficit hawks are hypocrites.


In my time, I was very concerned about cumulative deficits. My reservations were anchored on the suspicions that deficit spending may be due to financial indiscipline and financial indiscretions. Departments writing their budgets wanting to buy things or enlarging departments without actually using the additional expenditure. Budget deficits could also be accounted for by the manner by which departments do their budgets. Each year end, they will spend money frantically fearing that any leftovers would indicate they don't need the money in the first place. Otherwise,  next year's budget will be scaled down. No department heads want to have scaled down budgets.
More importantly, whenever the state presents its budget, less emphasis is placed on strategies to increase revenue. Tax base, tax collection. But you can't squeeze blood out of stone. What about non tax income? Government investments are one. But if your GLCs are managed by nincompoops, you can't expect to rake in money. Hence you are doomed.
I never questioned though, the deficit portion that is spent on the needy. The expenditure I termed and used as transfer payments. Subsidies going to free loaders- I object.
When Minister Idris Jala made his doomsday predictions, I questioned his blanket denunciation of subsidies, in particular those going to the needy. His predictions created havoc leading to contradictory statements coming from the 15th Floor of the MOF. He accepts the outcomes predicted based on an economy growing at 3% p.a besieged by a deficit rate growing at 12%. He assumes further, government ministers do nothing to address the situation other than enjoy some musical soirees at PETRONAS Philharmonic amphitheater or the PM's plush residence.
I think the PM will of course do something. Dropping Idris Jala is one option.
Idris is perhaps an unregistered member of the deficit hawks. In particular those who sanctimoniously declare we should stop giving subsidies to the poor but at the same time say nothing when there are ideas to build a new parliament building, spend more on constructing the king's place. I am not sure whether the cost has escalated from 400,000,000 to over RM 800,000,000. For I hear whispers that the actual expenditure has gone up to 1,200,000,000, 1.2 billion. The same voices become mute when told of Felda's dwindling cash reserves and the appointment of Felda's cash reserves to some bizarre applications as revealed by Minister Ahmad Maslan.
What do you call them? They can only be termed like what the economist Paul Krugman described as hypocrites, pure and simple
Perhaps the PM should ask Ahmad Maslan to go down to the grassroots, ask them whether they support cutting subsidies or they would rather object to the escalating cost of the new istana, or the building of a new parliament or are they happy with Maslan's explanation of Felda's disappearing cash reserves.

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Thursday, 17 June 2010

Reality check on UMNO


Britain's labor party probably now has a membership of 200,000 strong. In 1995, it has about 198,000 members. For a political party, that's not a big number. For a small number it has been able to govern Britain on several occasions.
The other major political party the Tories or the party that Margaret Thatcher once led has a membership of around 300,000 members. A conservative party member pays around RM 150 (£25) person as fee or around RM 30 (£5) if you are under the age of 23.
Relatively speaking, for a given population, Britain's political parties are small. They don't have 3,000,000 members of screaming skinheads with swastika emblems.
The capability of a small party ruling a first world country reflects to a large extent, the quality of leadership and the quality of party members. It also indicates less politicization of the population.
Suppose you do the same to UMNO. I mean, each member has to pay a fee of RM 150 per person per year and the pemuda, puteri and putera pay RM 30 per person per year.
That would immediately put a stop to any ketua bahagians, ketua cawangans, ketua pemuda or ketua puteri from paying for others. Everyone pays for themselves. Only those committed and who are believers in the party's cause will join. You don't need to have 3 million members if not all of them vote for you or don't believe in UMNO's cause. Big numbers mean nothing in the elections. It's the quality that's more important.
If members are not committed or believe in the party's cause, that is useless. In the last election, despite having 3 million members, UMNO candidates secured only 2.38 million votes. Malay voters numbered 5.7 million. If you subtract 380,000 voters from those who voted UMNO candidates on the assumption they were non Malays, you have 2 million as voters for UMNO. That means 1,000,000 UMNO members did not vote UMNO candidates or did not register as voters. More importantly, and I want UMNO leaders to be aware of this- 3.7 million Malay voters rejected UMNO candidates or did not register as voters or simply stayed home.
It's time for UMNO to look at this aspect of reforming the party. Raise the bar. Membership fees. Qualifications etc.
Will that make UMNO an elite party? Maybe so. But it isn't necessary for every Malay to become an UMNO member. It's sufficient if he supports UMNO because of its political programs. Being an UMNO member is no guarantee that he/she votes for UMNO candidates.
Quantity isn't relevant to UMNO. The UMNO leadership, I mean the entire leadership structure, especially those who think about the future should be thinking culture. A culture that lacks a driving, highly educated elite deeply committed to a cause is doomed to mediocrity.
UMNO doesn't have this culture. It has more of that crabs in the Malay open basket culture. UMNO isn't that serious about quality either. The riff raffs, the village bullies, the loafers, the lay-abouts, make up the majority of members.
UMNO doesn't seem to realize that actually, modern governance which includes decision making and priority setting is too complex to be left to the man in the street.

 

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Market friendly affirmative action


Just what does the phrase- affirmative action policies will remain, but they shall be made market friendly, market driven etc…?
It simply means the Malays must adapt or perish. Its economic evolution. The Malays need first of all economics, then politics. Solve this first and let's talk about democracy and other political niceties to the Malays.
If, on their own, Malays are not market responsive or not market sensitive- how? The ibrahim alis among us say, free market is not good for the Malays. Then, the logical step to me, is make them market responsive. Don't make them dependent and subservient, bowl in hand beggar. Discipline them to be market sensitive. Set about polices that make them market responsive. You don't get them ready, you don't lay a firm hand to make them adapt to free market ethos- you announce a system. Pose them a challenge to elicit the desired market response.
The Ibrahim Alis among us- his supporters and intellectual vanguard are like the conservative Tokugawa Shoguns. They want to keep the Malay world closed and to themselves. Only anointed members are allowed to foray on the outside. Forming liaisons with not-their- kind, enjoying the pleasures of life. They are practicing the we- know- best mentality. Accordingly, the best they know is keep the Malays enclosed and entrapped.
PM Najib, in this context represents the enlightened sections of the Tokukawa Shoguns who knew the road of survival is to adopt the knowledge of this world and leverage on them. The Ibrahim Ali's among us represent those hardened and unwilling to change elements. The Najibs among us, represent the imitative, adaptive and compliant people- not exactly commendable values, but those amenable to the introduction of new ideas and habits.
The adaptive and imitative are those most able to prosper while those who stubbornly cling to aged ideas, drown in the sea of changes.
What do they fear? Just like the conservative Tokugawa Shoguns, they fear 'contamination' with the outside world will undermine the Malay culture, religion and economy. What kind of culture?
A regimented hierarchical and the Malay crab syndrome. Those who got out the basket will not lend a helping hand to those left behind. Because those who got out did so because of cunning-ness and individual efforts and once they do, despise his other brethren for the lack of trying.
Our present day commodore Perry is globalization. It comes unstoppable. The reactionary shoguns among us offered building a fortress-like mindset. Insisting that the life as they knew it must be retained at all cost. What kind of life? That kind that rewards the inept, the loafers, the corner-cutters in society and that heap rewards on people on the basis of who they are instead of what they can do.

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Wednesday, 16 June 2010

How much does the average Malay mamat earns monthly?


I wanted to see, how the 'data' on the estimates on mean monthly income is received. As expected, it causes consternations among many. The average china man is interested to be in the monthly income RM 11,000 per month bracket. They don't believe the number.
The average Malayman also wants to be in the RM 3000 per month bracket. Even this paltry amount is desirable for the Malays because, they know, earning this RM 3000 per month is a work of fiction. The average Malay doesn't believe in this number too.
It would be politically stupid if the government comes out with a figure of Malay monthly average income that is far below than his Chinese fellow citizen. That would suggest that the entire economic policy on which they stake their future has been unsuccessful. So in my mind, placing the average income of a Malay as RM 3000 per month is more politically acceptable.
But what if the real average monthly income of the Malay is actually below RM 1,000? That would make the government almost criminal in its failure to address the Malay economic issue.
In 2009 for example, our GDP was 679,000,000,000. That's RM679 billion. The Malay population is 16 million. 16 million Malays share a portion of this Income. Let's use the favorite number as an approximation. Use 18% as the Malay share in wealth /equity is 18% currently.
That means 16 million Malays share 18% of 679 billion. You calculate to get the Malay average yearly income and divide the resultant by 12 to get the mean monthly income. You will be shocked to see that's about RM 636 per month.
Will the government dare admit that the average monthly income of the Malays is RM 640? Ask the Malay man in the street- would a monthly earning of below RM 1000 be the norm rather than a fictitious RM 3000 plus?

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10MP- Conspiracy of the Rich.


Thus we have 52 high impact projects worth RM63, 000,000,000. That's 63 thousand million. We shall see who gets to build the 7 highways worth RM19, 000,000,000. We are also building 2 coal fired electricity plants worth RM 7,000,000,000. Will that be furthering the cause of green technology?
Sungai Buloh land will be developed jointly by EPF and its partners for RM10,000,000,000. I have written about the development of the Sungai Besi Air Force Base . It will be led by the 1MDB- nee Terengganu Sovereign Fund. It will be advised by that splendid young man Taek Jho Low and his Qatari friends. Who knows at the launching of the project we shall be entertained by the likes of Usher, J.Lo and Rihana. Let's see whether they will develop this properly directly or they will do what privileged business people do- flip deals by selling the package to another party.
RM18,000,000,000 will be spent on 2 aluminum smelting plants, absorbing the excess electricity generated by the Bakun Dam. PETRONAS will construct LNG regassification plant for RM 3,000,000,000. We shall watch closely who PETRONAS appoints as its contractors.
Of course the government will subsidise the financing of these projects. It has created a financing vehicle to help spend RM 20,000,000,000. This isn't termed as subsidy. Subsidies are those expenditures that are not reciprocated by giving value. These companies give value so; the RM 20,000,000,000 is not subsidy. Subsidy is given to lazy people mostly Malays and so must be rescinded. These are those who clamoured for affirmative action policies but who didn't become market friendly.
But this RM20,000 million is expected to generate 200,000 million. That's value. Hence we can justify dishing out that amount at low interest rates.
Subsides are given to people who will bankrupt the country. Because the recipients are mostly Malays, this means the people responsible for bankrupting this nation are Malays. If we dig deeper, we shall discover that the particular Malays who bankrupt this nation are probably the ULM- UMNO linked Malays who are also the most prominent rent seekers led of course by Malay royalties, and the puteras in the bumi.
How much did we lose in the PKFZ project? RM 12,000,000,000? Well some portion from this 20,000 million will be used to finance a land reclamation project in Westport the same black hole that sucked  in tons of money for which no one was accountable for. It's a financial ghost-town which the government wants to exorcise.
Michelle Yeoh will be singing praises hearing that some of this cheap money will go to the construction of a Truly Asia Centre.  Malaysia- Truly Asia. Why do we need to finance a project in Iskandar Malaysia when IM has already got lots of funds? Has the Corridor been breached?

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Tuesday, 15 June 2010

10MP: A plan of the rich, by the rich and for the rich?-1



 

What's the mean monthly income of the various races in Malaysia? They are as follows:-
  • M: RM 3,400.
  • C: RM 11,000.
  • I: RM 9,000,
Malays earn RM3, 400, Chinese RM 11,000 and Indians RM9, 000. The 10MP should be addressing the question of how do I raise the mean monthly income of the Malays from RM 3,400 to RM 7,000 in 5 years. That, to the Malays is more meaningful than raising the PCI from RM 20,000 to RM 43,000. That doesn't mean a thing to the average Malayman, Chinaman and Indiaman. In 2009, Malaysia PCI was USD6700.
How do you do that for the Malays? Let's discuss this basic idea. You know the cultural setting of the Malays right. Compare the analogy of the Chinese and Malay crab sellers. The Chinaman places all the crabs in a closed basket. The Malayman places his in an open basket. Why the difference you ask? Because if the Chinaman places his crabs in an open basket, they will all escape. The crabs belonging to the Malayman will never escape. You are wondering in surprise.
This is how it is. You see, the Chinaman crabs will help each other to escape. When one crab is on top, the one below it will push it along so that it gets over the top. So on and so forth. To prevent escape, the china man must close his basket. The Malayman doesn't have to worry about this. That's because, if one crab attempts to climb out, the one below it will pull it down.
My architect friend has a more sinister story. He says, if a Malayman goes to hell, he will never come out. That's because, if he qualifies to get out, the other Malaymen will pull him back in.
So how will PM Najib address this Malay issue? How will  he raise the Malay income from RM 3k to RM 6k. Not much. Not a big target. See whether he can achieve this. Then let's talk about the 10MP.
We want to double this to USD15, 000 in 10 years time on the back of (a) 6% annual growth (b) increase FDI (c) exports etc. ( d) double digit growth of private investments. Who are the privateers? (e) human capital growth- talented people are given the resources to build capacity. Who's talking about this human capital? It must be spoken by people with credibility. The ketua UMNO cawangan with an SRP qualification is allowed to head the PIBG which extols the value of quality education
Where will the sources of growth be? In real economy though building productive capacity of his nation or though some financial magic show?
What do you make of the 10MP then? I was thinking of the American government. A government of the people, by the people and for the people. My thought on the 10MP is the plan of the rich, by the rich and for the rich.
Hence you have:-
Over RM 60,000,000,000 worth of projects for the same old guys- the Gamudas and MMC, the syed mokhtars, the Vincent Tans etc.
RM 35,000,000,000 for the greater Kuala Lumpur project to do what? I was telling a friend yesterday maybe the Gamuda guys are thinking of erecting a dome over the whole of Kuala Lumpur and aircond the whole place or create an artificial snow churning machine over the whole of KL. Our home- grown temperate botanical gardens to free us from this sweltering heat.
Was this given through the much touted Swiss method? It must be a Swiss blade that cuts all ways. The sports betting license which yields the holder of RM 1,000,000,000 a day? RM 5,000,000,000 for development of Sungai Besi airbase.
60,000,000,000 from 230,000,000,000 is a hefty proportion allotted to the private buccaneers. RM 35,000,000,000 is more than the budget going to the Ministry of Works who are carrying projects for the people.

This Plan is sounding more like a conspiracy of rich people!

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New man at Sime Darby


Tun Musa Hitam, chairman of beleaguered Sime Darby, has announced that Mohd Bakke has replaced Zubir Murshid. Who is Mohd Bakke? He is hailed by the papers as:-
"Mohd Bakke is highly regarded in the corporate sector. Prior to his appointment at Felda Global, Mohd Bakke served in various capacities within Government-Linked Companies and Government-Linked Investment Companies.
We hope Mohd Bakke is what he is. He is a graduate of LSE. He has all the marbles. That should put him in good stead.
It was also reported that his appointment has raised serious misgivings among the rank. This is a recurring problem with many of the government GLCs. The conventional wisdom is to bring in outside talent without thinking of the demoralising effects in that organisation. What about the in house talent?
This means that years of training, years of cultivation with the Sime Darby ethos bear no effects on in house talent.
This usually leads to the new broom sweeps fast syndrome. The quickest way to clean the books will be carried out through the Chainsaw Al Dunlap way. Or nearer to home, the head-hunter Jala Way. Sack staff, sell off assets, sell noncore businesses to cronies of course, do so some creative accounting.
The other way of course is to sack the entire dissident forces which dare to raise misgivings. Then the new man can craft a new way of working for Sime Darby.
Experience with GLCs mean nothing to public spirited members of the public. We have seen many of these much touted blazing guns creating nothing but destructive impacts.
Mohd Bakke's experience with Felda Global ventures or whatever does not erase the fact that Felda hasn't got its cash reserves. I mentioned in a short essay, that from 4.3 billion cash reserves, Felda has RM200 million cash reserves. Even that I hear is no more. Felda is borrowing from EPF.
If Bakke has been that good, those things would not have happen would they. So don't BS us with this talk about who he is. We are interested in what he can do now at Sime Darby. While at Tabung Haji I hear what Bakke was fantastically fast at was to secure placements for VIPS to perform the Haj pilgrimage.
Since he has plantations experience, we urge him to remove the false information that the problem with SD is confined only to energy and utilities division. Its plantation businesses are severely affected by labour shortages and un-harvested fruits. Money doesn't grow on trees in SD's case. The money need to be plucked and transported to the mills.
While we wish Mohd Bakke Godspeed and best wishes, we caution the public into believing the hype with these guys with GLC training. Remember what Chief Zed said to all the candidates who failed to become MIB agents:-
Zed: Gentlemen, congratulations. You're everything we've come to expect from years of government training. Now please step this way, as we provide you with our final test: an eye exam...

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Monday, 14 June 2010

One Fingering the 10th Malaysia Plan

Who prepared the 10th Malaysia Plan? It sounds so APCOish- another PR exercise meant to boost the PM's popularity. We must be living in the dark ages- easily suckered by the myth-making machinery.

Or it must be written by some people who get some kick out of rhymed thematic association. Hence 10 big ideas for 10th Malaysia Plan. Next year, 11 big ideas for some other plan. Eleven being the PM's favorite number.

The high income economy depends of Malaysia getting a 6% growth in the economy. The TPM says this is doable. Private investments through the likes of Sapuras, Syed Mokhtars, Nazas, Gamudas, etc can give us the almost 13% growth rate in private investments. Not difficult- give them all the strategic business deals. Moreover they are Bumiputera- giving to them, over and over again is justifiable because it's done in the name of Malays. In the meantime, never mind if Felda, the plantation has to borrow from EPF. It's our father's money.

This kind of argument is demeaning to the Malays- I am sorry to give this analogy- it's like ignoring somebody else making love to your loved one. Never mind, as long as the loved one gets the sex. Rape in the name of BUmiputera.

So, if we Malays ignore and countenance this kid of condescending and by nature inherently exploitative argument, the Malays will be doomed. Syed Mokhtar for example started with selling rice or something. He has been given many other things. Last I heard, even the supply of tanks to the military is being done by Syed Mokhtar. Does he have the experience and expertise in doing that kind of business before he was given? None. He was given because of who he is not because of what he actually can do.

By citing this argument against the Syed Mokhtars, I am not forgetting those non Malays who hitched a ride of the privileged bandwagon. The Yeohs, the Kim Siews and of course the Vincent Tans. You are not serious in suggesting that these people are better upstairs are you?

The same people will now be rushing and tripping over each other making a beeline to the PM's office or maybe grovel at the feet of the PM's wife to get an early hearing. Services? Ah yes- health care is a gold mine. Education. Insurance for the government. Tony Fernandez is eying the hospitality and health care business. Give them licenses, monopolies etc. they can create the wealth which will enable to give us the coveted USD 15k PCI. That's the One Finger Malaysia way. Pointing in the right direction of course!

I am saying Ibrahim Ali has got it wrong. The 10th Malaysia Plan is not going to incorporate his demands because if they are, the 10th Malaysia Plan isn't going to succeed. Why? Because essentially, the 10th Malaysia Plan depends on private investments. And private investors are not likely to be enamored with the incendiary calls by Ibrahim and his gang. PM Najib will of course be looking at the bigger picture. The sacrifice of Ibrahim Ali is part of a bigger picture of inducing private investments and realization of his USD15,000 PCI target.

How will it get to this? To create and ferment that attractiveness, the government will hit three areas - half its deficit, reshape the workforce and push for urbanization. The simplest way is to go on a cavorting binge with the private sector (read those names that I mentioned above) hence the increase in privatization by five-fold over the 9MP from twelve billion to almost sixty three billion with fifty two projects. It will also add twenty billion to mezzanine some of the PFIs.

  • Redevelopment of Kg Abdullah Hukum- Setia 6 billion.
  • MRT Greater Kuala Lumpur -Gamuda 35 bil.
  • Gaming License Ascot/Vincent Tan 1 bil.
  • Sg Besi RMAF Base Malton Group 15 bil.
  • Pahang water transfer Loh&LOh 0.5 bil.

Everything's in the pipeline baby! Perkasa- we will support completely what this government is doing.

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The 10th Plan- waddling through the BS

Readers will have noticed that my previous post was entitled reading the 10th Malaysian plan. It was chosen deliberately. I wanted to distance myself from a point by point commentary. That is being done by more rigorous thinkers. Bloggers under the name E Theorist and Economics Malaysia are better equipped to deal with the issue. Wenger J Khairy is another blogger who can cut across the entire BS and tell it as it is. I shall step aside for them.

I have chosen to see it from the big picture. By big picture I mean, seeing the plan as a part of something bigger. The plan is an instrument to create a higher income Malaysia. In that context, the admonitions and screams of people like Perkasa are completely irrelevant and excluded.

Placing the plan in a contextual frame, allows me to discuss the plan expansively. Seeing the big picture allows me to treat the issue of Malay economics in terms of it being a part of creating a high income Malaysia. For example, the issue of NEPish content of future Malaysia Plans is no longer a priority since the overriding objective is to get to the level of PCI of USD15,000. Those people at Perkasa have not realized this, but they will be terribly disappointed.

Let us tackle the issue of Malay economics. I read that my old professor KAM Ariff who taught me International Economics in my second year at UM, giving a very critical assessment of the NEP or NEP in its re-hatched form. I am not going to steal his thunder- but I have written this point, a long time ago. These were stated in a number of essays on the subject.

What is the purpose of the 1oth Malaysia Plan? The overriding objective is to make Malaysia a high income economy. That is defined as having a PCI of USD15, 000. The problem can thus be stated as Malaysia's High Income Economy is a function of getting a PCI of USD 15,000. Agree?

Then our attention is directed to the issue of how to get the USD15k? The problem stated doesn't say anything about who gets the USD 15 k. it says just 15k. Who earns the 15k? Its just people- a concept. It doesn't distinguish between a Bumi or non Bumi. It's silent on this issue.

You see, the overriding objective stated in that way, right from the beginning, does not admit any differentiation of who gets the PCI of USD15,000. Or put it in another way, USD15, 000 is only achievable IFF (if and only if), the agent getting the USD15,000 is not broken down into a Chinese, Indian or Malay economic agent. It's just an economic agent, undifferentiated.

That immediately and at once, chucks out all those screaming by Perkasa out of the window and people like Ibrahim Ali and his intellectual spokesman- being made to look stupid.

I repeat ( in the spirit of Ibrahim Ali repeating his shit-speake 3 times)- the success of getting a PCI of USD 15,000 depends in NOT distinguishing who actually gets the USD15,000. So, no Bumiputera economics there.

The only way the so called Bumiputera 30% share of the economy is going to be achieved is for the government to do the same thing- confine bumiputera involvements among people like Sapura, Syed MOkhtar, IMdevelopment, other cronies. These people will be given economic largesse over and over again. Sapura gets oil and gas deals from PETRONAS, they get defense deals, they get these over and over again, Syed Mohtar gets to do bridges, railways, double tracking, ports and hear this, gets to supply tanks to MINDEF. These are the Bumiputeras who ride on the angst of the bumi lumpenproletariat.

UMNO must be going mad!

But Ibrahim Ali and his people don't understand economics. The concept of people in the equation is not differentiated. The 10th Malaysia Plan doesn't care who achieves the 15k.

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