Categories
Politics & government

[2961] Umno’s calls for stability is a racketeering slogan

Stability is Umno and BN’s rally cry for this general election. But it is a disingenuous political messaging given that all recent instabilities are directly caused by Umno and their allies.

Umno’s argument for stability is akin to racketeering. Wikipedia has a concise definition: when somebody offers “a service that solves a problem that would not exist without the racket.” One concrete example involves a shop paying protection money, which the protection is from violence perpetrated by the fee collectors. Yet another concrete example is, well, Umno’s version of stability.

Umno and their allies, and this included Pas until recently, manufactured ethnic tensions throughout the 2018-2020 Pakatan Harapan administration. The manufactured inter-ethnic crisis brought instability to the country, all with the hope that Pakatan Harapan would fall, and be replaced with a government that Umno would be part of. Pakatan Harapan government collapsed under the pressure as Bersatu—naive and shortsighted as they are—fell for the racket.

Ethnic tension quietened once Umno were back in power, which highlights the fact that high ethnic tension during that period was unnatural. It was manufactured by partisan forces that were Umno and Pas. It was a racketeering done at the expense of the country: a dishonest scheme to obtain power and money. To more than a few people, it was a scheme to avoid jail time.

Despite being part of the federal government after the fall of Pakatan Harapan government, Umno members were unhappy that they played second fiddle to Bersatu. To address their unhappiness, Umno sabotaged their own government for their own partisan benefits. Instability ensued until they won. Stability is something Umno want only when they are at the apex of power. When they are out of it, stability is a liability to them and must be pushed aside, regardless the cost to the country.

And the country paid the cost: Malaysia lost anything between 2 to 6 weeks of reaction time during the Covid-19 economic and health crisis. While Umno maneuvered for private partisan gains, thousands paid the price with their lives. More than 36,000 deaths in Malaysia are linked to Covid-19 up to this day. Millions more suffered economic hardship due to incompetent and late handling of the crisis, as the Umno raced to secure their political positions.

Ultimately, the 2018 change in power itself was, in a large part, caused by Umno and their corruption. 1MDB was the straw that broke the camel’s back. It was the final factor that made public anger go bubbling. Without the 1MDB corruption and the subsequent power abuses to cover up the crimes, Malaysians would not have been so angry to do what they have done in 2018. And the people did not make a mistake in 2018 as Umno alleged. The people went out of the their way to make sure the check-and-balance mechanism worked, in spite of all the institutional abuses by Umno.

If Umno really want to label the 2018 democratic change as instability, then everybody should see through the veil: that the source of the so-called instability is Umno themselves. Truly, Umno has no moral authority to campaign for stability and their calls for stability is nothing but a racketeer’s slogan.

 

Categories
Economics Politics & government

[2960] Election time: my preferred transport policies

Recently, I wrote election manifestos should have overarching themes, while avoiding the kitchen sink approach. While I focus on Pakatan Harapan, Barisan Nasional also had a kitchen sink approach before. Kitchen sink is the favorite way of doing things among political parties.

I do not have the energy to come out with a manifesto myself, but if I had to choose one area, then it has to be transport policy, which intersects with many other areas that includes fiscal, climate and urban development policy.

My ideal transport policy will be constrained by at least 3 factors:

  • Promoting responsible fiscal policy to rapidly build up government capacity in healthcare, education, defense and overall industrial policy
  • Reducing carbon emissions with respect to concerns for climate change
  • Improving connectivity across the country, especially in and around major cities where most of the population work and live.

These constraints mean, especially in the cities, fewer private vehicles on the road, and greater reliance on public transport.

This list is not comprehensive, but I think the areas it broaches are major concerns. Here are my preferred policies.

Fuel policy: Switch from petrol subsidy to cash transfer

Current fuel subsidy policy is expensive. It takes resources away from many other areas. As reported in the media, as of June, 2022 subsidy bill alone (not including other social assistance) was expected to hit RM78 billion. This is bigger than 2022 allocation for the Ministry of Health (RM32 billion), Ministry of Defense (RM16 billion) or Ministry of Education (RM53 billion). While subsidies alleviate short term pain, it does not build long term capacity: it takes resources away and weakens already underfunded health, defense and education systems, among others. Imagine what these systems would look like if they had an additional RM78 billion for their services and asset acquisition.

Here, I would like to return to the late-2000 policy of switching from fuel subsidies to cash transfers (before it was abused as goodies). It does not have to be a one-to-one switch since cash has higher value than fuel subsidies: the former has many more use cases than fuel subsidies.

Cash transfer implementation will have to be discussed elsewhere, together with the introduction of tax identification number.

Fuel policy: Tax petrol through SST (or GST)

Simultaneously, I advocate fuel tax. SST (or GST) should be charged on purchase of petrol. While I do not support ring-fencing income from fuel tax for any particular purpose, additional income here should be able to fund a large cash transfer program, as well as to introduce new public transport service while improving existing ones (more about public transport later).

Such tax will discourage excessive use of private vehicles, which will:

  • Improve journey time by taking cars off the road
  • Shift some traffic from private vehicles to public transport
  • Reduce carbon emissions

I would think removal of subsidies and introduction of fuel tax alone would provide the government with resources to build its capacity in multiple areas. And of course, in public transport too.

Specific subsidies (however the implementation is) can be provided to a limited number of people based on geographies or industries. I would imagine logistics service providers and other transport operators should have access to fuel subsidies. Small-time farming and fisheries probably should be subsidized too.

Public transport: government to fund rail transport directly

The current state of public transport is deplorable, and part of the problem is that rail service providers are putting financial rather than service performance first. That financial focus is part of the reason city rail policy in the country has become a bit of a real estate play, rather than about moving people around efficiently.

It is time we admit public transport, city rail in this current state especially, are financially nonviable. While admitting so, we must take into account those rail services are a public good.

With these two things in mind, the government should directly fund these rail services, and reform various rail service providers’ key performance indices from financial-based, to primarily performance-based. (Let us not play with paper-shifting accounting anymore and get serious about public transport).

Besides, for all intends and purposes, these services are already funded by the government indirectly through committed guarantees. It is just that too many people are in denial about public transport finances in Malaysia (see the chart below for the 2023 Fiscal Outlook report, which is the result of lasting reporting reforms made in 2018-2020. Observe commitment linked to DanaInfra, Prasarana and Malaysia Rail Link). They hide behind accounting standards to avoid the truth: the government is already funding these rail services through convoluted means.

This however does not mean public transport is free, but it should be cheap enough, particularly with respect to costs of private vehicle ownership.

Which rail services should under this? I am thinking primarily monorail, LRT and MRT in KL.

Public transport: Postpone MRT3 and HSR to later years when ridership demand is more appropriate, and improve existing rail services instead

Given the current state of rail transport usage and efficiency in Kuala Lumpur, I am unconvinced of the need for MRT3 at the moment. I rather wait until the current rail system nears full or even three-fourths capacity before moving ahead with MRT3. At the same time, with the ringgit weakening, it might be a good idea to control government-induced imports: MRT3 and HSR would definitely need large imports that would exacerbate the situation we are in.

I also am not too warm about having new city rail services in other cities. There are very few cities in Malaysia that have enough population to rationalize building a new city rail line.

As for HSR, I rather we strengthen and expand KTMB’s ETS.

For ECRL, it is too late to do anything about it. But I suppose, the long run goal is to integrate it into KTMB. We should streamline such rail service instead of fragmentizing them.

At the same time, improvement in services will require purchases of new assets. This, obviously, has to be done through open tender. No more sweet deal with China-based companies, which has proven to be overpriced in the long-term despite appearing cheap at the outset.

Furthermore, improving existing rail services would be a chance to further develop Malaysia’s industrial capacity, instead of importing from China technology that we already have.

Public transport: More bus services, and bus lanes in the cities

To improve public transport around in cities all around the countries, buses are likely the most cost-effective ways doing it. And it is flexible unlike rail. Focus on buses instead of rail should keep Malaysia’s transport policy from ballooning the way it has (without the associated improved performance) in the past decades.

Two things:

  1. For buses operated by Rapid, the same government-funded model used in rail applies. These are city-buses.
  2. For buses run by private entities, the government to subsidize fares given some service-level requirements. This is likely applicable in small cities, and interstate services, which do not compete with government-provided services. This should also help with rural buses, where low ridership might kill off services.

It is also time to consider dedicated bus lanes on existing roads. Here, we have Jakarta to learn from. More bus lanes will also discourage private car use in the city, by taking lanes away from private vehicles.

Highway: No new highways in the Klang Valley

With the exception of Sabah and Sarawak, and some parts of the East Coast, the Peninsular West Coast probably does not need new highways (particularly so the Klang Valley). So, no need highways in the Klang Valley.

Tolls: Congestion charges in the cities

I prefer to have congestion charges in the cities. This also means no abolition of tolls, or lower of tolls outside of congestion charges model (abolition of toll means the barrier of switching from private vehicles to public transport will be higher and we need to avoid that). The implementation of total congestion charges may have to come with stages and the easiest is probably to wait for all the concession to end and have the government, or the relevant city authorities take it over. This is probably most relevant for KL and its satellites, and possibly George Town too.

For interstate tolled highways, I am ambivalent. We could keep the current system, but refrains from seasonal toll discounts.

Tolls: payment methods

There are too many lanes for different payment methods.

Makes all lanes capable of accepting all payment methods. Also, no express lanes. Everybody should line up and wait for their turns.

Private vehicle ownership/etc

I am going to list down several items without much elaboration:

  • Doubling (tripling) of excise duties on luxury vehicles for carbon emissions
  • Banning of large vehicles (i.e. pick-up trucks) for individual uses for carbon emissions and safety concerns
  • Banning of white headlamps for safety concerns
  • Cash for clunkers program to address emissions and safety concerns
  • I am ambivalent about this, but we possibly need ideas on investment for electric vehicle infrastructure.

Aviation

Yes, refunds mean refunding in cash, not in funny credits. This shall be the law.

Categories
Economics Politics & government

[2959] Budget 2023 and Undi Banjir are examples of BN irresponsibility

Barisan Nasional believes the yet to be approved Budget 2023 is an asset to them, with their supporters are taking it as their election manifesto. Unfortunately for them, a yearly government budget is no replacement for a 5-year manifesto. To me, using Budget 2023 as a manifesto, with its process halted midway, is a sign of irresponsibility.

Irresponsibility, because we are no longer living in at a time when BN is assured of returning to power. It could be PH, PN or any other permutation out there. If a different government gets elected, the budget process will have to be recalibrated. Any government will want to execute their own agenda. Indeed, even if BN gets into power, there is no guarantee Budget 2023 will not change. Even BN PM candidate is uncertain, with assurance given incredible.

The smooth running of the government should sit beyond partisan politics, but BN places that below their political fortune. The risk of disruption to the budget process is of no cost to them, but only to the people of Malaysia at a time when the global economy is risking recession.

Such irresponsibility of course should be apparent to many in the past two years through various instances of double standard in the application of rules during the Covid-19 pandemic that brought so many unnecessary deaths.

But such irresponsibility should not be a surprise. After all, BN wants a general election during flooding season. Just like during the pandemic, they are willing to gamble our lives for their partisan benefits.

The Budget 2023, unapproved, and risked being redone, is just yet another example of BN irresponsibility.

Categories
Books & printed materials Politics & government Society

[2958] Reviewing We Are Marching Now

I try to read (and finish) at least a book a month. That is a slow, given there are hundreds of titles in my to-be-read list. So long is the list, that I have stopped updating them altogether, realizing keeping track of my appetite is a futile exercise. But when We Are Marching Now by Danny Lim came out, I put it right into the list and bought it when the author launched his book at Central Market in downtown Kuala Lumpur. I paused my current read—Bill Hayton’s The South China Sea, which is about the history of China’s territorial claim in the area—and started going through my latest purchase.

I enjoyed the book. It was an easy read.

While reading it, I struggled to think of similar books published in Malaysia. By similar, I mean a book in the style of investigative journalism. There is Billion Dollar Whale but that is not a Malaysian publication, though it is about the country. While I have not read it, Money Logging by Lukas Straumann is another. I have not read too many investigative genre myself. My last read before Billion Dollar Whale was Bob Woodward’s The Agenda about the Clinton administration.

I might be wrong, but it does look like We Are Marching Now is one of its kind, as far as Malaysian publication is concerned. If not, then it has to be a very rare breed at the very least. That makes it refreshing within the context of local publication.

As for the topic of the book itself, I have a short remark: the book is about the genesis of Bersih, understood through various interviews the author had with personalities involved in the early days of the organization. I think the author did a good job weaving the interviews together to form a coherent narrative.

Additionally—others have mentioned this—it is worth highlighting that political parties played a crucial role in making Bersih a success.

I think this is an important point to be remembered by civil activists who value non-partisanship above everything else. It is not easy to gain public support and then corral it towards a cause. More often than not, political parties excel at that, more than anyone else. Yes, party politics are messy and self-interested. Events in the past two or more years have been nothing but angering. But when it is done right, these parties could be a powerful force for good, as in the case of Bersih.

I have been to all of the Bersih protests, and here, I want to leave you with, possibly, the favorite of mine, out of thousands I snapped from those protests:

By Hafiz Noor Shams. Some rights reserved. Creative Commons. By attribution.

Categories
Economics Politics & government

[2957] Pakatan Harapan should avoid kitchen sink manifesto

Election is nearing and among policy-minded voters, it is not difficult to spot manifesto discussions. As someone with some implementation experience in government, let me say the last Pakatan Harapan manifesto was difficult. I knew this before I was pulled into the whole business: I reviewed the manifesto and summarized it as the following: the economic plank was “difficult to stomach wholly” but the other parts, particularly the institutional agenda, were what we needed. Given my concerns were institutional in nature, I was willing to give a blind eye to the economic plank, and support the institutional aspect wholly.

Looking back, the economic manifesto rode on popular anger quite effectively. That explained the kitchen sink approach taken by its authors. GST, monopoly, living costs, corporate corruption and other concerns were all meshed into one big document, which did not jive together. The authors knew what they wanted.

Unfortunately, riding the wave, and actually executing the policies were two very different things. Mahathir famously said ‘we’ did not expect to win, and so did not expect to implement those promises. Manifesto bukan kitab suci; manifesto isn’t a holy book. That highlighted the difficulties associated with the economic aspects of the manifesto, especially after GST was abolished just weeks after the 2018 election, and more importantly, before the Finance Minister was sworn in to bring SST back.

The next election, Pakatan Harapan can do better. They need to do better because the same mid-2010s anger is no longer there. There is little to match that economic anger, save the stubborn but relaxing global food prices and rising recession risks.

If I were to write the manifesto all by myself, I would reiterate the institutional aspects and reuse a good chunk for the 2022/2023 general election, and come up with a new one for the economic side. On the economics, I would reject the 2018 kitchen sink approach. I would instead set up overarching national goals. What do I mean by that?

In the kitchen sink approach, almost everything economic-related concerns were siloed off with little concerns to bigger concerns. One way to put it simply is that the proposed solutions were necessarily single-minded and siloed that the same proposed solutions ignored their effects on other things, like government finances and economic growth. At the implementation stage, at times this left those solutions contradicting each other, leaving individuals implementing those siloed solutions fighting each other and accusing the other side as blocking manifesto fulfillment. For instance, when Pakatan Harapan abolished GST without regards to policy sequencing, notwithstanding the previous problem with refunds (truly, the additional government revenue was lowered than BN admitted), how exactly the government would finance other parts of its economic promises? PTPTN? Highways? Petrol subsidies?

As you can see, the kitchen sink approach works from funding supply first, and then effectively takes the funding demand as an afterthought. This caused the troubles Mahathir identified so early. You ended up with insufficient funding supply to meet rising funding demand.

In the overarching national goals, it should work the other way round: start from funding demand-side first, and then work the funding supply-side afterwards.

To do this, we have to ask ourselves, what do we want for Malaysia?

Do we want to maintain our largely free, government revenue-financed healthcare system?

Do we want a welfare system given the damage Covid-19 has done to the financial security of many Malaysians?

Do we want a good education system? What kind?

Do we want better cities? Transport policy?

Do we want stronger defense?

Do we want to climate change infrastructure? Energy policy?

What?

This requires deep discussions among many parties, from lay users to experts. It has to be multidisciplinary, exactly so to avoid the silo problem that the 2018 Pakatan Harapan manifesto suffered (and contemporaneously, the Ministry of Health’s ongoing white paper).

And this way, we can be honest when it comes to taxation: taxes have to rise.

The truth few willing to say loudly because it is unpopular is that the Malaysia government lacks funding to do a whole lot of things due to low taxation. We can raise the deficit ratio, but even so it would not be enough to meet various legitimate demand associated with basic functions of government like health and defense (let us not talk about unorthodox fairy tales about ‘printing money’). For a country aspiring to be a “first-world” with worsening demography (but still young), our tax (and the bigger government) revenue to GDP ratio is low. That fact has caused unnecessary outsourcing of basic functions to the private sector. The same fact is the reason behind a whole lot of off-budget borrowings and spendings, which are nontransparent and significantly raises corruption risk in an environment where underfunded institutions cannot play their check-and-balance role properly.

To tell this truth, you have to tell the funding demand-side story: what do you want?

Of course, not all wants can be entertained lest the same problems besetting the 2018 manifesto would come back. You cannot want a well-run public transport system while wanting blanket petrol subsidies and eye-roll-worthy car duties cut. You cannot want a working revenue-funded health system while supporting tax cut for private insurance and spending at private hospitals. You cannot want a fully-funded education system while supporting tax cut for private education institutions. You cannot want a healthy Malaysian population but keep sugar cheap. You cannot want a good road while wanting a low road tax and cheap petrol.

Manifesto authors have to choose instead of putting everything into the kitchen sink. Here is where leadership is needed: decide on the policy direction instead of a Hail Mary rush.

And also, of course, manifesto has to be popular. It has to have its hooks. But those populist promises can be brought in line with the overarching themes. For example, have public transport cheap, with discount and vouchers and everything, and admit the system will always be in the red, to which the government will have to fully fund it directly (leaving financial performance for public transport system second in priority to physical performance).

Be direct about the funding demand, and through that, we can be honest about funding supply, and taxation.

I should add that the institutional aspect of the 2018 manifesto worked because it had an overarching goal: improving the overall check-and-balance mechanism and all of them are linked to one another in one way or another. It was not a kitchen sink.

To summarize it all: the next manifesto should be driven by overarching goals, instead of a laundry list of grouses. In other words, do not throw everything into the kitchen sink.