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Sakmongkol ak 47

Wednesday 25 November 2009

Sieg Heil Economics-1


After 1969, the answer to Malay economic problem is solvable it was thought through command center economics and centralized planning. A variant to this command centre economics and centralized economic planning is we get to play god in choosing who we want to advance. What developed is not only siege mentality but could be more appropriately termed the bunker mentality. The high seats once occupied by the money changers are now seating officious and benevolent G Men. They are the public sector money changers in the temple of the New Deal for Bumiputeras. Once you are ensconced inside the bunker, comforted by the impenetrable walls, asking these people residing there to dismantle that edifice will not be a walk through the park. You are going to get stiff opposition and outright denunciations.

This led to an economics which I termed as Sieg Heil economics. You actually choose people who you want to succeed. They then become salutary examples of the Malay can-do-anything spirit if given the license, quota, monopoly chance.

Hence we saw the emergence of handpicked and anointed super Bumiputeras who were given quotas, exclusive licenses, protection and so forth. To this very day, this kind of sieg heil economics- where the chosen one is expected to raise his hands saluting Malay-can-do anything spirit is still happening. Witness for example the license given to Naza Group to build a RM600 million Matrade Centre in exchange for land valued to be worth RM15 billion. To me, we must add a new definition to the concept of usury in the Islamic Lexicon.

Groups of benevolent public officials huddled together to plan the industry and improvement of the Malays. Of course we didn't see the extreme form of centralized planning such as the Mahalanobis gigantic input output tables in Nehru's India planning every minutiae of economic life of the Malays. That kind of planning wasn't sustainable because that kind of planning was discovered to be not so successful. The more potent reason for its disavowal was because it conflicted with the idea of freedom.

Unfortunately, the failure of omnipotent economic planning hasn't stopped the expanded role of government. The expanded role of government took different forms such as nationalization by other means as in the formation of GLCs and even direct ownership of the means of production. It also took the form of regulatory activities.

Just like Roosevelt's New Deal, the new approach to solving the Malay economic problem was accepted by the public as successful because it did achieve successes for the Malays to shout in triumph. From a share of around 2% in corporate equity, by the end of 1990, the share of Bumiputera equity in corporate wealth was around 19%. Though short of the targeted 30%, it was hailed as a qualified success better than nothing. Out of the whole thing, emerged the acceptance that enlarged government participation in the economy is justifiable as a means to remedy the economic problem.

The idea of a caring benevolent government resonated well with the consuming public especially the Malays and definitely with policy makers and politicians. It gave them an added source of omnipotent powers. Hardly anyone would argue for example with the government's agenda to care for the Malays from the cradle to the grave. Indeed as is the customary practice, policy makers in almost all the Dewan Undangan Negeri will justify expanded government involvement and outright ownership of the means of production and therefore budget deficits as necessary to carry out welfare programs for the poor. Who would want to oppose such noble intention if it's meant for the poor?

Have the programs succeeded? That is another issue. Each year, the number asking for welfare assistance in the form of cash disbursements seemed to increase rather than decrease. Dissatisfaction over the actual disbursements has aggravated rather than subsided. The number partaking in the welfare disbursements in the PM's own parliamentary constituency is growing each year indicating that the number of poor people is increasing as the magnitude of the disbursements increases. Or the increasing number indicates, more are joining the cue to get free gravy from the gravy train.

It means that this expanded role of the government hasn't worked well. It worked well for those in the bunker who happen to be the very ones bitterly opposed to the dismantling of the Sieg Heil economics.


Saya... 25 November 2009 at 21:00  

Ususry doesn't quite cut it. Beyond usury.

Beyond redemption.

Anonymous,  25 November 2009 at 23:47  

Dear Dato Sak,
I would be grateful if you could support a noble initiative for greater social responsibility amongst bloggers by hosting the B-S-R logo on your blog.


Wenger J Khairy

Peter,  26 November 2009 at 00:57  

why dont they exchange the whole of Malaysia?

So easy to make money lah ....

Btw.. there is nothing anyone can do about it. Shout you may... that is the way we are heading.

Are You Gonna Go My Way,  26 November 2009 at 01:12  

the real person that helps the economy is my friend Mamu. He sells rojak and cendol.He might not be paying incometax but...he buys 10kilos of flour, 20 can of Susu Cap Teko, santan etc everyday. The retailers made the most profits and they in turn pay the taxes....

So dont look down on small business people...they are the real movers and shakers of the economy in Malaysia...

kuldeep 26 November 2009 at 10:04  

i was not allowed into the bunker..have been shot at as target practise for last 30 years and my body is a walking dummy riddled with heavy duty bullets of all types of persuasion i.e government issue,government agency issue,private sector issue,Chinese issue..

I am still hopeful that the bunker will still be there for my children and grandchildren.Its not easy for my kids to be poor in a country where wealth of the parents is the measure of intellect of the children.

Maybe the sophiscates and the people of the inner kingdom is ready to leave the bunkers for the greener pastures of F1 and Monte Carlo..let us the poor take over the bunker.

The siege is not mental...only the menial knows the siege begins at dawn and ends just before mid night i.e. if Rapid is on schedule.

Suci Dalam Debu 26 November 2009 at 10:12  


I have difficulties understanding your articles. Too many words and terms that I don't understand. Maybe my English proficiency is not up to standard.

Dr Mahathir can covey his thoughts in simple English.

Just my 2 sen.

Anonymous,  26 November 2009 at 11:31  

Dear Sak,
While you just stumbled upon this Sieg Heil Economics 101, the rakyat has known about this modus operandi for ages.

SOP : Gomen gives project to crony company with bank loans thrown in. If project fails, gomen will step-in to rescue the company.

Some examples are the KL monorail and latest is the PKFZ. Looks like this system is not going to stop because these cronies are acting as a front for their masters.

Anonymous,  26 November 2009 at 12:25  

suci dalam debu,

you have answered the reason for your predicament.
2) maybe you should do some background reading.
3) may we suggest you read comic books.
4) others can understand what this blogger wants to write.

Ariff Sabri 26 November 2009 at 12:29  

anon at 11:31

if it makes you happy saying that i stumbled upon this subject, pls continue. i am glad you say its 101 level.

Anonymous,  26 November 2009 at 16:43  

dt sak

agree with you.those who knows who make the most money.we the common people struggle to make profit.

open tender price so low, wonder how some contractor make.probably these are the contractors who 'sakit'.competition very would be nice if everyone once in a while got design and built project.then only can bernafas lega..

it is quite sad indeed.

Anonymous,  26 November 2009 at 16:44  

dato sak

betul la tolong la dalam simple english.susahnye nak faham..

Ariff Sabri 26 November 2009 at 18:29  

suci dalam debu
dont despair. my wife who was teaching English at primary school only manages to understand the gist of my articles. she couldn't understand anything Margaret Thatcher wrote in her books.
i am pretty sure this isn't the first time you read by articles.
as to Dr Mahathir's style- siapa boleh ikut style our true statesman.
salamat hari raya.

kuldeep 26 November 2009 at 19:21  

Today I learnt a few things that have changed my understanding of your article..

1>> Tok Pa says the government have fooled NAZA TTDI into giving a free Matrade Center.Its very2 unfair for the government to do that as Naza is a Malaysian..I think it is completely unethical.

2>>However,I must also applaud UMNO's serious concern about the people of Kelantan i.e due to TGNA poor management practise of not having a very clear SUCCESSION PLANNING the Kelantan people have a great risk.As such,I will not be surprised if UMNO with their collective wisdoms and ultra NKRA mgmt expertise create "labs" to find the right successor for TGNA. one instance UMNO can be RUTHLESS in using dirty tricks to fool NAZA but on the other hand have shown great compassion for the rakyat of Kelantan (even tho they rejected BN).

Truly the personification of the hand that bites with a smile .

Anonymous,  26 November 2009 at 19:49  

"We have to change our mind set.No one owes us a living just because we are Bumiputras.We have to learn to be competitive,innovative and have the courage and passion to change."

"TGNA professes to be clean and yet even for the holiest of man he has accepted a "gift"for a VVIP Makkah trip.Is this leadership?"

I will be very convinced of the above and totally subscribe to your "siege mentality"ideas if it does not come from an Armani clad,Patek Philliped timed,4 litre SUV riding guy..who thinks an InterContinental Makkah for a whole family package is a necessary convenience.

Its hard to buy Benitez cry of not enough funds to make Liverpool great if one is managing Wigan.

Anonymous,  26 November 2009 at 19:54  

Tun, Tun laaa...Sakmongkol Sakmongkol lah dia org nih..ader jer masalah ngan org


Suci Dalam Debu 26 November 2009 at 21:24  


Takpelah Engrand saya di tahap yang rendah.

Terima kasih atas teguran membina saudara. Akan saya gandakan usaha untuk mendalami bidang yang sesuai supaya dapat menghayati karya Dato' ini.

walla 26 November 2009 at 22:41  

I can only understand half of what Suci understood of what Sak had written. And that only with my trusty learner's dictionary.

And i bersimpati with Kuldeep for having to take Rapid too. It's anything but its name.

Take for instance this comment i saw somewhere:

"Lucian Pye reconceptualizes Asian political development as a product of cultural attitudes about power and authority.

He contrasts the great traditions of Confucian East Asia with the Southeast Asian cultures and the South Asian traditions of Hinduism and Islam, and explores the national differences within these larger civilizations.

Breaking with modern political theory, Pye believes that power differs profoundly from one culture to another.

In Asia the masses of the people are group-oriented and respectful of authority, while their leaders are more concerned with dignity and upholding collective pride than with problem-solving.

As culture decides the course of political development, Pye shows how Asian societies, confronted with the task of setting up modern nation-states, respond by fashioning paternalistic forms of power that satisfy their deep psychological craving for security.

This new paternalism may appear essentially authoritarian to Western eyes, but Pye maintains that it is a valid response to the people's needs and will ensure community solidarity and strong group loyalties.

He predicts that we are certain to see emerging from Asia's accelerating transformation some new version of modern society that may avoid many of the forms of tension common to Western civilization but may also produce a whole new set of problems."

What is it? Can it be applied to our Malay economic problem so aptly described by Sak?

Is there a need for minds to open up in order to unshackle (simply tembak with new word here) the chains of post-colonial feudalism (just cut and paste this phrase from somewhere-lah).

Maybe i'll be a happier old man if i have a kebun to do something instead. I want to grow some fruits. Like cempedak.

Kuldeep, don't worry. I will pray for your prosperity. The world owes you one black MB SLK batmobile; i have my own leggamobile.

Meanwhile i am starting to worry why the gomen is suddenly pushing the GST to broaden its income base. Like they are running out of money. But what about the two stimulus packages totaling rm68 billion?

The thing is the GST is a consumption tax, this memang bermakna they want the rakyat to consume properly so that they can have more revenue.

If that be the case, why not they consume properly first so that they won't have to tell the rakyat to consume properly? Not that the majority of the rakyat have much to consume in the first place. Haha.

So watch out for it. After the rm1 bilion logistics contract for pdrm, the next one will be the systems upgrade for Customs and Mof to do this GST indirect tax transition. The system will be so big it may need a super-complex to eclipse (another new word i learn) the matrade complex.

Which comes to what i thought but forgotten. Namely, maybe the only penyelesaian to all this leaky pipe problem is for the rakyat to sound the alarm bell first before each big project is about to be raised. Then everyone will be watching to see who gets the contract and how much and so on.

In the past the contracts are issued and nobody knows how come that fella got it. Now the rakyat ask before the proposal is even written up, and the gomen must answer. This way, more money saved so then no need to ask rakyat to consume more carefully what they cannot afford in the first place. Haha again.

I better change chempedak to t.a.

Suci Dalam Debu 27 November 2009 at 12:58  


Selamat Hari Raya Haji.

kuldeep 27 November 2009 at 19:02  

thanks for the batmobile.I will accept it only if ur giving it to me as a friend and not because I am a Bumiputra.

And I have to correct you..RAPID is doing an excellent job..they have improved their services ten fold since Idrose took over the job.They have optimised routings,drivers/staff seems happier and motivated..and steps are underway to procure more and better buses,lrt cars etc.The integration is being improved.Hopefully,with Doc Amin at KTM the komuter services will be improved as well.

Its sad that these 2 Bumiputra CEOs have failed to live up to the perceived performance of Bumiputras but have instead performed with hands on passion and pure hard work.Now we got less Bumi CEOs to rant about and criticise.

walla 27 November 2009 at 20:24  


the merc is to you as friend; i take back what i wrote about Rapid and wish the two CEOs you mentioned great success in life ahead.

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