[702] Of statism and Malaysia Airlines

Yesterday, Malaysia Airlines’ (MAS) new managing director, Idris Jala announced that MAS will move out of its headquarters in Kuala Lumpur in effort to cut cost. This might signal an eventual sale of the building. Today, Malaysian Deputy Prime Minister made known that the government won’t interfere with MAS operation. This is good news.

Several weeks ago, when Idris Jala brought up the possibility of selling MAS HQ building in Kuala Lumpur, politicians, some senators from the Dewan Negara and other old dogs were up in arms, harping at Idris Jala for even considering the matter. After all, MAS is Malaysia’s national air carrier, much like how Proton is Malaysian national car manufacturer. It’s national pride and the sale of MAS building could dent that pride. Hence, their reaction is comprehensible. Their opposition however is irrational.

Pride rarely has a place in business, especially when it gets tough. More often than not, a person, an entity or whatever has to swallow its pride and get on with it. What’s better or the best option won’t necessarily feed one’s ego. MAS is facing this dilemma and Idris Jala realizes this. He deserves respect for simply being able to perceive the scenario and look beyond pride. The politicians that disagree with Idris Jala deserve a kick for putting too much emphasize on pride.

The government should mostly do what it does best and that is governing. Government intervention on MAS is unneeded and unwanted. Malaysian government should learn something from Singapore Airlines – the firm, despite being linked to the government, must be free to work out its own strategy.

Pride won’t save MAS and neither will politicians that oppose the sale. These politicians are a bunch of statists. Do we really expect these statists to know more about MAS than the managing director himself?

No. Unless, if the politicians themselves have proper background in business. But that’s rarely the case, isn’t it?

p/s – the price of internalizing pollution – over USD 3 billion.

China will invest 26.6 billion yuan (US$3.28 billion; EUR2.69 billion) over the next five years to clean up the Songhua River, a key source of drinking water for tens of millions of people that was polluted in November by a toxic spill that reached into Russia, reports said Sunday.

That amount doesn’t even reflect full cost accounting. Imagine what the figure would look like with full cost accounting. Already, a third spill is in progress.

BEIJING (AFP) – A third major toxic spill in China in as many months has threatened water supplies to millions of residents of two central cities, officials and state media have said.

A clean-up accident allowed industrial chemical cadmium, which can cause neurological disorders and cancer, to flood out of a smelting works and into the Xiangjiang River in Hunan province on January 4, Xinhua news agency said Sunday.

If things go as they are going at the moment, the PRC might just overtake the US as an environmental devil.

pp/s – and Michigan goes unranked for the second time in six months. Bravo Carr!