Whichever party or coalition wins in GE15, has a massive task to get the country’s economy back on track in the midst of the global economic downturn.
The resignation of UK Prime Minister Liz Truss on Thursday, 20 Oct, just six weeks after having been sworn in has given emphasis that for Malaysia’s GE15, it is imperative that the winning coalition or party be capable of stabilising the economy.
Liz Truss took her pledge of office on 06 Sept after Boris Johnson was forced to resign in July. Prior to taking office as the PM, she was the Secretary of State for Foreign, Commonwealth and Development Affairs of the United Kingdom (2021 – 2022).
Her credentials are no less impressive, yet she failed, bringing down the Conservative Party with her for being the shortest-serving PM in the history of the United Kingdom. In the six weeks she was in office, as much as she tried, she was getting nowhere. In fact, things were getting from bad to worse.
Where is the Hope?
For me, this is like deja vu like when we just came back to Malaysia in 2018, weeks after the Pakatan Harapan (PH) government came into being. It was like coming back to a disaster zone, and I was thinking: Where is the ‘Harapan’ (hope)?
Apart from the massive job layoffs, dragging opposition politicians to court to prosecute them without following the rule of law, lies unto lies about our national debt and spendings by the previous administration, the PH government also took on what everyone was calling as The Great Malaysian Sale. Scores of government assets were sold off en bloc, mostly to foreign entities. These assets were actually making profits, thus the government was going to lose out on the potential earnings.
Apparently, PH sold off almost RM30b worth of national assets within 500 days of taking power as the chart below has listed.
That is why I was so surprised when I came across this article in FMT recently quoting Professor Geoffrey Williams who said, among other things that a PH win will appear more stable as they have a clear, united prime minister and finance minister team.
To tell you the truth, I was gobsmacked when I read this and wondered where the learned professor was during the 22 months of PH rule. I was then inspired to seek the comments of a Professor of Economics, Dr Wong Chin Yoong from Universiti Tunku Abdul Rahman (UTAR).
A Unique GE15
According to Prof Wong, GE15 is going to be unique on several fronts.
“For the very first time we have all the major contending alliances (I mean BN, PH and PN) with administrative experiences, and the electoral atmosphere is apparently different from GE14. Enthusiasm for PH is lesser, and criticism of BN is less intense.
“While the electoral outcome is hard to be judged a priority, it seems more likely, at least at this point of time, that no alliance is going to win a strong majority, and that post-election political bargaining and coalition becomes more likely,” Wong said.
He added that this brings to some important implications on policy making: Don’t expect political and policy stability from a strong ruling alliance. The era of strong majority/strong government/strong man politics is over.
Policy Arrogance
“This is probably good for the economy, as political monopoly typically ends with policy arrogance and mistakes with less ability for self-correction.
“That doesn’t mean we can’t have a good policy in such a political reality. As a matter of fact, a more balanced distribution of political powers means policy made by post-election political coalition will better reflect the needs of different segments of society. It also means that we are going to have a more decent opposition with stronger voices for check and balance in policy formulation and implementation,” he added.
In short, Prof Wong opines that power-sharing among alliances with effective checks and balances from the opposition, rather than a strong government/strong man politics, shall be the road to stability and prosperity ahead for Malaysia.
We shall learn from the mistakes of Truss’s government, but carefully. It is not about engaging in budget deficit. One shall not cry wolf on government debt, claiming that the financial market chaos is all about government debt. Because it is not.
Lessons to be Learnt
He pointed out two core lessons from Truss’s mistake:
- Never forget about being and showing fiscal sustainability. The market reaction was neither about the temporary spending on energy-saving bills nor tax cut, but a tax cut without being serious about its financing. All the plan miraculously hopes for is the growth that follows tax cuts. The market just didn’t buy it.
- Ignoring economic reality at its political perils. The interest rate is on rising cycle, and ordinary people are suffering from soaring energy prices. And yet, the plan pledges more tax cuts for the rich, funded by more borrowing on the rising cost. It doesn’t make any political sense.
NMH‘s feature writer on finance and economy, Zam Yahaya chipped in with his opinions too.
“It’s simple, really. On things that you are not certain of, look at the track record. In this case, look at Najib Razak’s track record both during the crisis as well as during other times.
“Not even Mahathir can match it. The latter failed at least three times during his 22-year rule to manage the impact of the economic crisis. Not to mention the domestic mess created during his time such as BMF, Maminco, FOREX scandal losses to name a few which directly, and indirectly, had a serious negative impact on the national economy then.”
Zam added that different alliances that ruled before did bring both good and damage to the economy. At the end, it is the policy and institution that matter to the economy, not the party.
Marked Differences
As for me, I would like to say this: if you take 22 months of PH rule and any 22 months of BN rule, we can tell the marked differences.
Even if they claim that PH had to inherit massive debts and service the 1MDB loans, we must always remember that PH themselves destroyed any potential of 1MDB recovering any losses via an IPO which they sabotaged.
They were sabotaging the country’s economy prior to GE14, and when they took over they were clueless about what to do and dug a bigger hole. Should we trust such people ever again? After all, our national debt has really reached over 1 trillion now (see poster).
What are PH lawmakers going to do about it if they were to take over the country again? Sell more assets until the country is left with just skin and bones?
Vote wisely, people of Malaysia. So much is at stake right now. – NMH
About the writer: Carole Raymond Abdullah is a freelance writer who used to domicile in Hongkong for many years. She is now back in Malaysia, totally surprised at the turn of events in the country lately.
The points expressed in this article are that of the writer and do not necessarily reflect the stand of the New Malaysia Herald.
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