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Wednesday, October 28, 2020

Rebutting The Economist: ‘Boomed’ Or Doomed?


The Economist had an interesting article about Malaysia last 28th of September which entitled, “Bumi, Not Booming”. To sum it all, the article predicts a dark and winding road for Dato’ Seri Najib due to UMNO’s decision to abruptly backtracking its course instead of going forward with the ‘liberal style of politics’ that was promoted before the election.

The Economist prediction on Dato’ Seri Najib’s ‘misfortune’ was based on the recently announced Bumiputera Economic Empowerment (BEE) programme. It is said that the programme that is projected at RM10 billion in terms of aids, loans, contracts and projects to benefit only one ethnic, would halt the economy instead of booming it.

In short, the Economist is saying that Dato’ Seri Najib is wrong and that the bumis should not be given priority just because they have shown loyalty to the ruling party in the last election.

To be fair and frank, the BEE is not a grand solution to the bumiputras’ economic problem, but it is well received, nevertheless, as a political statement that the government is not going to abandon the bumiputras during the hard times.

As we know, the rationalization of subsidy paired with the ever-rising cost of living is already pushing the working class bumiputras to the edge. With property price soaring ridiculously, the only group to benefit from the ‘liberal style of politics’ as the Economist put it, is only seen to be benefiting the already rich, especially the Chinese.

The key word here is ‘the already rich Chinese’, which is a hard-facts accepted even by the Economist. There seems to be a sign of concern on how the government will raise the necessary billions for BEE and probably think that it will come from the Chinese.

It would be funny to have to explain to the Economist that a basic rule of economy is that it works in circle with chains and links. A trader will not get his profit if he has no one to sell his products to. Therefore, in Malaysian context, in order to help the already rich Chinese businessmen get richer, the bumiputras have to have the ability to buy.

In short, should the Chinese want to be richer, the purchasing power of bumiputras who represent the largest number of consumers, must first be increased. And BEE is designed especially to meet this objective.

The richer the bumis, the richer the Chinese and the richer the country will be as more people will have, and will be able to pay taxes. Thus, BEE will not upset the economy.

The Economist has obviously noticed that the bumiputras were not very happy with the ‘liberal style of politics’. And history tells us that a country will not be in a good shape if the majority is not happy.

We cannot deny that with the announcement of BEE, Dato’ Seri Najib has managed to erase the doubts and concerns among the bumiputras over their future, under his leadership. Clearly, he is fast to react to the sentiments of the majority. He knows that an unhappy majority could create a lot of problems, and an angry majority could create chaos and lead the country to its doom.

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