Sunday, June 6, 2010

Malaysian Mottos Makes Me Loco

Seperti ilmu padi hampa, makin lama makin mencongak
Loosely translated, this Malay proverb means ‘Like an ear of corn which grows tall in proportion to its emptiness’. The more one is puffed up with pride, the more likely that one’s achievements is just full of hot air. If we apply this to the length of letters in our slogans, it just shows how ‘tall’ we have grown. The more lavish our slogans, the more ludicrous records in our very own Malaysian Book of Records - the more ‘empty’ and ‘hollow’ our lives become.

Life in Malaysia is quite amusing at times. One inescapable fact of life is that when there is a change in the top leadership, a massive public relations campaign is mounted, spearheaded by catchy slogans promising ‘change’. Unfortunately, the nation seems to be headed in the OPPOSITE direction promised by these slogans. ‘Talking the talk’ is what we have come to expect from politicians. Not ‘walking the talk’ is also understandable. However, when one ‘talks one way, walks the opposite way’ or ‘Cakap Tak Serupa Bikin’, things becomes unbearable.

Bersih, Cekap dan Amanah
What does this motto mean? Loosely translated, it might mean Clean, Proficient and Trustworthy. Simply put, let’s just say it means ‘No Corruption’. Well, have we succeeded in reducing corruption in Malaysia? Let’s use the Corruption Perceptions Index by Transparency International as a measure.

Ooops… it appears that Corruption is actually on the uptrend rather than being reduced. See what I mean?

Cemerlang, Gemilang dan Terbilang
Excellence, Glory and Renown. A fantastic slogan that conjures up images a Golden Age filled with Emperors, Heroes and Glorious Armies of a long lost age. Perhaps one could use such words for the ancient Roman Empire or the Tang Dynasty. But for Malaysia? Is this realistic? A slide from PEMANDU should suffice.

So much for Excellence, Glory or Renown . Perhaps it is true that ‘Those whom the Gods would destroy, They first make Proud’?

One Malaysia. People First, Performance Now
Gee! This sounds quite swell. Finally a motto that actually makes sense. Now, if only the ruling Government could follow through on this one. Unfortunately, the walk has been in the opposite direction. Don’t believe me? Look at the picture below.

Nobody minds good mottos, especially ones that we can believe in. However, let’s have honest mottos that we can rally behind and work towards. How about an eminently more sensible motto on what Malaysians needs? (with apologies to William Boyd "Bill" Watterson II)

Kick MY Butt!

Thursday, June 3, 2010

Lies, Damned Lies and Statistics

On 27 May 2010, Idris Jala, CEO of Pemandu presented the Government’s justification for the proposed removal of subsidies. The presentation can be downloaded here. Today, we all the mainstream newspapers interviewing Idris Jala and allowing him to explain his views further here. It seems eminently reasonable to remove the subsidies, if you are one of those that lack a thinking cap. Once you think hard enough though, something appears to be wrong with this picture.

Interesting Headlines but …
The Government tells us that we, Malaysians must be swimming in the lake of milk and honey all this while. In Bolehland, prices are the lowest and life, the rosiest. We have enjoyed living in luxury via generous government subsidies and now the party’s over. No more Bolehland … time to return to the ‘Real World’. Well, this appears to be strange. The cost of living appears to have gone UP these past few years but … well, the picture above seems to imply otherwise. Is what is being said true?

An Independent Analysis
Let’s use the Internet to do a simple, independent analysis, shall we? The analysis below is a review of the cost of living between Malaysia and Singapore, using Numbeo, a free Internet database about the cost of living worldwide. Why Singapore? Well, that tiny little speck south of Johor was once part of Malaysia. We are both geographically and culturally similar. Since Bolehland has the lowest prices in the region, we would expect our cost of living to be significantly LOWER than Singapore, right?

Using Numbeo, we can compare the prices of food in Malaysia and Singapore in USD as well as our median monthly disposable income. Let’s look at the numbers below (click on the picture to enlarge it):
Hmmm.., food costs twice as much in Singapore (USD510) as compared to Malaysia (USD268). So, it is true that we are paying much less for food due to subsidies paid for by our Government. However, let’s not forget the MOST important fact. The average median monthly disposable salary of Singaporeans of USD2.2K is more than twice that of Malaysians, USD0.9K. Singaporeans only have to fork out 22% of their disposable salary on food. However in Malaysia, we have to fork out 27% of our disposable income for the same foodstuff. Although this analysis is imprecise, it is sufficient as an indicator that our cost of living is higher than Singapore. Further, this high cost will only go UP if we agree to the subsidy hike.

So, if the Government goes ahead and removes the subsidies on subsidized goods and fuel, inflation is projected by the Government to increase to approximately 5% per annum. This will be compounded by an additional 5% Goods and Services Tax by the Government. To maintain the same lifestyle, Malaysians will have to fork out an additional 3% (or more) of their hard earned (might I add, measly) salary for food alone.

The main question we should be asking is WHY there is such a HUGE disparity in the quality of life enjoyed by Singaporeans compared to Malaysians? Why is the Government portraying Malaysia as the land of milk and honey? Even BEFORE the subsidies are removed, our cost of living is already substantially higher than the Singaporeans. Let’s not forget that Singapore is a country with almost non-existent natural resources and lacks the economies of scale that Malaysia possesses.

Surprisingly, based on PEMANDU Open Day polls, over 90% of the attendees are ‘happy’ with the proposed subsidy removal. And that is being used as one of THE main justification to remove the subsidies. The very Government that put into place this subsidy mechanism, spent beyond its' limits and wasted billions in white elephants projects and bailing out GLCs is asking us for more money. They promise that it will be used wisely to increase our monthly income, eventually. I say, let’s wait for PIGS to fly and hope that we don’t starve to death in the meantime.

Saturday, May 29, 2010

Propaganda: Malaysian Style

The maxim that ‘If you tell a lie big enough and keep repeating it, people will eventually come to believe it’ appears to be the driving principle behind the public relations effort by our Malaysian Government over the proposed removal of the subsidies. The official ‘story’ such as the one by Sin Chew entitled ‘The Malaysian Dilemma’ exemplifies this. Here is an extract:

If Malaysia's economy can expand robustly over the next couple of years, and our incomes grow significantly with the wealth gap narrowed concurrently, then the ensuing pains from subsidy cuts will be diluted.

Very simple. The subsidies North Korean government has provided to its citizens are perhaps the most generous in the world, but with appallingly low incomes, the people remain impoverished despite the generous government subsidies. In contrast, South Koreans can still enjoy very comfortable lives without the generous handouts from the government, because they have very high incomes.

As a matter of fact, our government needs not worry about subsidy cuts. More importantly, it must implement policies that will enhance economic growth, improve government efficiency, while cutting down unnecessary red tape and corruption so as to boost investor confidence.

Subsidies will no longer be that important once our per capita income becomes doubled.

Since this is an issue that concerns our livelihood, we should ‘THINK’ and see how ridiculous the argument above is.

IF, If and if
Reading the first paragraph implies that our economy has been stagnating, our income has shrunk and the wealth gap between the poor and the rich had grown substantially during the past decade.

Albert Einstein once quoted that ‘Insanity: doing the same thing over and over again and expecting different results.’ So, let me ask you a simple question. How confident are you that the people that led our country on this financial precipice can find the courage, vision and wisdom to reverse our downturn and lead us onto a different path?

Subsidies Sucks
Is it true that subsidies are the bane of economic wealth? This article seems to imply that subsidies are the reason behind the decline of North Korea’s economy whereas the prosperity of the South Koreans is due to lack of subsidies. This is like comparing an apple with an orange. North Korea is under a dictatorship with substantial military spending. Further, with economic sanctions imposed on it by the United Nations, it is little wonder the country is suffering economically. To imply that subsidies are the reason for the poverty of the country is cheeky, to say the least.

Government Initiatives
The article goes further and states that the Government needs not worry about the cut in subsidies since ‘subsidies will no longer be that important once our per capita income becomes doubled’. Is this supposed to be a joke? Do you see the twisted logic here?

What the article is actually saying is that with the cut in subsidies, the Government will finally implement policies that will enhance economic growth and cut down on red tape and corruption. Of course, this implies that the Government has failed in implementing sound policies on economic growth for decades. Red tape and corruption have been allowed to flourish until we stand at the very edge of financial ruin.

The crux of the argument by the Government is that the subsidies are a waste of money. And that they are better used elsewhere to fuel economic growth of our country. We are now being asked to hand over more money to the people that created this mess in the first place. Now that’s really insane.

Whilst the Government is to be lauded with coming clean about the dire financial situation Malaysia is in, one should wonder whether it is too little, too late. Critical analysis and constructive suggestions such as ‘Economic tsunami heading our way’ by Dr Lim Teck Ghee is most instructive. What we don’t need is non-sensical propaganda saying ‘Yes’ to every government initiatives especially one as detrimental as removal of subsidies. Added with the proposed Goods and Services Tax (GST), these are really dire times ahead for Malaysians.

Thursday, May 27, 2010

When the Going gets Tough, The Tough gets Going

Today, as I skimmed through the headlines of our newspaper, three very interesting headlines caught my eye…

‘Malaysia government plans fuel and other subsidy cuts to avoid becoming bankrupt by 2019’

‘Sime defends business model after Q3 loss’

‘Malaysia's 40 Richest Wealth Soars 42 Per Cent To US$51 Billion’

Malaysia Boleh or 'Tidak Apa' Attitude
It is said that we often get what we deserve, and I believe that is true of our elected Government as well. The very fact that most Malaysians don’t even bat an eye at the excessive spending of our Government on lavish and often uneconomical projects such as the PKFZ projects is astounding.

The fact that the Government has admitted it may follow Greece into bankruptcy is a serious wake up call. Yet, even with the proposed removal of subsidies and implementation of Goods and Services Tax (GST) – I doubt Malaysia can remain in the black. These suggestions are an attempt to treat the symptoms of the disease but not the underlying reason.

The Buddha once cautioned that:

‘Just as in the case of a great tank with four inlets and outlets, if a man should close the inlets and open the outlets and there should be no adequate rainfall, decrease of water is to be expected in that tank, and not an increase’

Our Government seems to have taken Buddha lessons to heart. On one hand, its’ increasing its’ inlet [income] by raising new taxes such as GST and removing subsidies for the public. But will it do any good if it continues to spend, spend and spend by opening the outlets to the tank?

Proposed Goods & Services Tax
One, the Government is running out of money. Two, GST is supposed to bring in additional ‘moolah’ for the Government. Three, the Government says that taxes will actually be less under the GST and will not unduly burden the lower income and middle class.

So, where do you think the additional money for the Government is going to come from? Some of you might think – yeah, it will come from the upper class. Are you kidding me? The Income Tax that we pay via our Borang BE is by far, a more equitable system. If you earn more, you pay more to the Government. So, why doesn’t the Government increase the tax rates under Income Tax instead of using GST?

Simple, under the GST, the tax burden shifts more to the poor than the rich. Heck, the rich can afford to pay a measly 5% tax on that flashy handbag but to tax an additional 5% on a packet of nasi lemak may be too much on the poor. Forget about price controls! And if the Government tries to institute price controls on certain controlled items after the implementation on GST – well you might pay the same price for your packet of nasi lemak – but it may have shrunk by half.

Remove Subsidies and then what? [Spend, spend and spend?]
Typically, our official media has portrayed the Government as being responsible in highlighting the issue and trying to resolve it with public input. Hogwash! And we are missing the big picture here. It’s all fine and dandy to want to remove the subsidies to the public but what about the rest of the Government expenditures.

Firstly, isn’t the Government a little bloated? I am sure a large % of the government expenditures goes towards paying for the salaries of our civil servants. Hmmm… private entities usually ‘downsize’ in times of difficulties. What about our Government?

Secondly, why are we in this situation in the first place? Where have our vast natural resources such as timber, fertile land, petroleum etc. gone? If the Government is going to continue to sink our money into white elephants – I prefer the money go into subsidies rather than beasts such as PKFZ.

Thirdly, when are we going to stop bailing out GLCs such as MAS, Sime Darby and Proton? Sure, remove the subsidies if you want to – but please remove the excessive and ludicrous tax on foreign cars as well.

Often, it takes two to tango. If the Government wants the public to bear the burden of its’ fiscal deficit by removing subsidies – we want some accountability as well. How about some real effort in eliminating leakages and white elephants? What’s the point of saving a couple of billion in subsidies and squandering them later on. Can we also have more transparency such as releasing detailed financial statements of Petronas?

Saturday, January 16, 2010

Philosophical Musings - Part XXVIII

The Roots of Wisdom

As I laid in bed, struck with a serious illness over the past month - I realize just how fragile my life really is. There is nothing like the threat of my life being forcibly taken away for me to really comprehend how attached I am to this life I'm leading. Taking care of one's health may sound cliched but it's better than being bedridden for a month. Though I've lost a month, I've gained a new found appreciation for life and my health. There's nothing like Calvin's proverbial advice - a good swift kick in the butt is what I need to get going. And that reminds me on Hong Yingming's verse on the roots of sorrow below.

The Roots of Sorrow

The Diseases of Old Age
Are all incurred at the time of our Youth

The Adversities that overtake us after we start to decline
Were all created at the time of our Prosperity


Therefore, when the Gentleman is enjoying Status & Fortune
He is extremely apprehensive

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