The prime minister said that under its new political model, the ruling coalition must strive to use political avenues to help the public rather than the current practice of pressuring the various ministries to act.
Najib said that “in the current landscape … political parties can act through political channels” to request help from partners and “take the initiative to have programmes.”
His administration has been committed to trimming the budget deficit from a two-decade high of seven per cent in 2009 to 5.4 per cent this year but surging inflation — especially in urban centres where his coalition is weakest — has forced Putrajaya to rethink its timetable for subsidy cuts.
After hitting a two-year peak of three per cent in March, the consumer price index has continued to rise, hitting 3.5 per cent in June as the government increased fuel, electricity and sugar prices to prevent the subsidy bill from doubling to RM21 billion.
The Umno president is also expected to call for general elections soon despite his mandate only expiring in early 2013.
Both government and opposition lawmakers have said that Najib should announce an election budget for next year as sustaining subsidies continues to put a strain on the Treasury.
Pressure from hardline Malay ground to maintain Bumiputera quotas is also threatening the prime minister’s economic transformation programme that aims to double per capita income by 2020.
Observers believe a new five-year mandate will give Najib some breathing space to execute his economic reforms to move Malaysia out of the “middle-income trap,” which in turn, will allow him to ease the burden of subsidies on the budget.
Launching the BN Youth Home Owner Programme Exhibition (Hope) today, Najib said that such initiatives, which pulled together stakeholders such as developers, financial institutes and prospective homeowners, were an example of how “BN is capable of fulfilling the hopes of the public.”
The markets are watching, the Republicans are watching, the Democrats are watching, the media are watching, the pollsters and pundits are watching. The public is watching and is disgusted with Washington, D.C.
When it comes to the bitter and ultra-partisan battles over the budget, the deficit, and the fast-approaching deadline for America to avoid defaulting on its financial commitments, the whole nation and even the world is watching.
But God is watching too.
Others are watching to see how their self-interests will benefit in the final deal. Or they are watching to see who’s up and who’s down, who will get the political win, and whose election chances will be better afterward.
Forty-eight hours after President Obama mentioned corporate jet tax deductions, and suggested they might not be as important as scholarships for low-income kids going to college for the first time, a headline appeared in the New York Times reading, “Industry Set for Fight to Keep Corporate Jet Tax Breaks.” Wow. That was pretty fast. The ones who will win the current battle over the budget and deficit are the ones who are watching. As the book of Proverbs teaches, the poor are shunned, but the rich have many friends.
Agribusiness is ready to respond if anyone challenges the subsidies that go to millionaire “farmers” living in Manhattan. The oil and gas industry reacts to questions about whether $2.5 billion in offshore drilling subsidies might be less needed than $2.5 billion slated to be cut in home heating oil assistance for low-income families. The Pentagon is watching and ready to invoke national security interests, or question the patriotism of anyone daring to cut its budget. A bipartisan commission came up with $1 trillion in military cuts over the next 10 years that wouldn’t hurt our national security, but it is unlikely that more than a fraction of their recommendations will ever be taken.
Republicans are watching and are ready to push the nation even closer to the brink of default if anyone suggests that revenue from the wealthy be a part of the solution. Democrats are watching, but, with a few notable exceptions, they don’t say the word “poor” out loud anymore. Anyone who could end up paying more in taxes is watching, even though taxes as a percentage of GDP dropped from 20 percent
in 2000 to just over 14 percent in 2010. The average effective tax rate for the wealthiest is now only 17 percent
of their income, and many corporations do not pay any taxes at all.
At the same time, nutrition programs for low-income mothers and children are at risk of being cut, as well as children’s health programs, education for low-income students, early childhood development, and the most effective initiatives in the world, which are dramatically reducing both disease and hunger. These programs are at the risk of being cutbecause nobody has been watching out for them.
But the religious community is changing this: It formed “A Circle of Protection” to defend the most effective anti-poverty efforts both at home and around the world. Today, Sojourners has a full-page ad in Politico with the message “God Is Watching” as a part of our series of print ads on the budget. This week our radio ads, recorded by local pastors, are playing in Nevada, Kentucky, and Ohio to remind politicians of the moral issues at stake. Faith leaders say God is biased in such matters, and prefers to protect the poor instead of the rich, and instructs the faithful to do the same. This is class warfare now, and when it breaks out, the Bible suggests that God is on the side of defending the poor from assault.
In the past, our country has successfully reduced deficits and poverty at the same time. There were bipartisan agreements to defend the means-tested programs for low-income people against cuts. And for the past 25 years, every automatic budget cut mechanism has exempted core low-income assistance programs. But not this time. Neither the Republican House, the Democratic Senate, nor the Obama White House has clearly and publicly committed to protect the poor and vulnerable, even though religious leaders have persistently pressed them all to do so. It’s a moral imperative that we do so again today. So now, faith leaders are watching the political leaders. And we believe God is watching us all.
Not every country in the world can afford fighter jets. Its prohibitive cost, maintenance and spare parts run into the billions of ringgit. Not to mention the accompanying hi-tech accessories and weapons arsenal which the aircraft cannot do without.
The country’s fetish for any thing hi-tech is laudable. Just like us ‘kiasu’Malaysians with our i-phones and i-pads, or blackberrys that cost a bomb. Like purchases of Lamborghinis and Ferraris that are just super expensive play toys not worth their weight in gold, or RM24 million diamond rings and RM14 billion gold and jewel-studded yachts. Having a couple of units of the Eurofigter Typhoons won’t guarantee that Malaysia will win a war. It may be considered a deterrent, but a damn expensive one.
Fighter jets are known for their stealth capabilities, able to fly at supersonic speed, arriving at their targets so quickly and disappearing like magic. They are so deadly that they can obliterate their targets faster than the enemy can say mama mia! Armed with laser guided missiles they can take out and disable a military installation from miles away.
They have extra powerful engines that are able to take-off at less than 100 feet into the air, compared with commercial planes that need at least 10,000 feet of runway. Some of them like the F-35s are equipped with VTOL (vertical take off and landing) just like helicopters. But all these high tech fighter jets consume massive amounts of fuel like there is no tomorrow. So logistically wise they are not equipped for long missions. An aircraft carrier would be a good place to station fighter jets, where they can park themselves in international waters a safe distance from the targeted country, while the fighter jets are deployed to fly in and take out all the military targets.
Armed to the teeth with a hi-tech array of powerful weapons, bunker busting bombs and tomahawk missiles, they are so accurate and so effective in inflicting maximum damage, that many countries are awed by their capabilities. Travelling at supersonic speed and almost invisible to radar, they are immune to counter attacks from the ground, except from another fighter jet.
When Malaysia bought our Russian made MIG29’s a decade ago, it was even reputed to be more sophisticated than the American F16’s and at a fraction of the price. But like all machines, they go out of fashion, and become obsolete in an instant, that Defence Ministries are at a loss whether to upgrade or keep their original fleet at risk of national security. Today our MIG’s are no match for the latest and more sophisticated fighter jets in circulation or the Eurofighter Typhoons.
With a maximum speed of 2500km per hour, it also has a range of 2900km. Although it is not designed to be a stealth fighter, it has excellent radar masking qualities in a large section of its body.
With a payload up to 52000 lbs at take-off, it can carry a large arsenal of weapons, missiles and bombs making it a multi-role combat fighter aircraft. There is no doubt that such a purchase will meet the growing needs of the nation, but then isn’t the price a little too expensive?
Eurofighters vs Bankruptcy by 2019
If those same billions were allowed to flood the Malaysian economy instead, our stagnant economy will steamroll forward like a jet engine to be on par with many first world countries. Malaysia’s economy is not very stable at the moment, and there is talk that the country may go bankrupt by 2019, so why is there such a need to spend so lavishly?
Already most of our staple food subsidies have been discontinued, while electricity has gone up. The petrol price will definitely go up again. Isn’t it time for the government to implement spending cuts, and reuse these funds to stimulate the economy?
The Eurofighter typhoons are priced at RM3 billion a piece according to Bernama, which is way beyond the market price Germany paid for their Eurofighters. Check the aviation news archives and you will find that on 17 June 2009, Germany ordered 31 aircraft of Tranche 3A model for 2.8 billion euros which works out to be a system cost of €90m per aircraft or around RM350 million each.
How on earth did the price shoot up so astronomically to RM3000 million per aircraft? That’s almost 10 fold per aircraft. Does the price include the 10 year full maintenance package, its high tech accessories, and the sophisticated weapons arsenal?
Can the nation actually afford 30 billion ringgit to purchase 10 aircraft? It would mean 30,000 less ‘would be’ millionaires in this country. Moreover, Malaysia has yet to grasp the full cost of Prime Minister Najib Razak’s purchase of two second-hand Scorpene submarines at RM7.3 billion. It seems the maintenance has not been fully disclosed. For sure, it will be a while before the country can digest this huge cost.
Then there is the purchase of 6 operating patrol vessels costing RM1 billion each, which the navy needs now that it is found that the Scorpenes cannot patrol the shall Straits of Malacca after all.
Malaysia policy-makers must be professional. They must decide whether there is any real foreign threat to the nation before making another rash decision to spend lavishly – just to join the neverending arms race. And as some cynics have pointed out, to line their own pockets as well.
Neo-illiberalism is India’s bane
Dear Justices Nijjar and Reddy,
Many of us welcome your decision in the Supreme Court case on black money, castigating the government for its inaction and setting up an independent special investigative team. This approach needs to be institutionalized: i have long argued for an independent Police Commission, analogous to the Election Commission.
However, in a long preamble to your judgment, you attribute black money and the “predatory state” to neo-liberal ideology. Excuse me, but the very opposite is true: the licence-permit raj is what creates a predatory state in which politicians make money out of controls. This would be difficult or impossible in a liberal framework that has impartial rules and no political discretion.
Liberals aim to get rid of controls imposed in the holy name of socialism and then used for kickbacks and patronage networks. Instead, liberals seek a rule-based system and free competition that ends kickbacks and favours.
You refer to neo-liberals promoting a “greed is good” model. May i request you to cite a single great liberal who ever said that? On the contrary, the books of great liberal thinkers from Adam Smith (“ The Theory of Moral Sentiments” ) to Milton Friedman (“ Free to Choose” ), all emphasize morality. Friedman says the foremost argument for free markets is not efficiency but morality—freedom to choose empowers citizens, whether in politics or the market, and the moral imperative of such empowerment matters much more than higher GDP.
“Greed is good” is the quip of a fictional character, Gordon Gecko, in the Hollywood film “Wall Street.” Unable to cope with the reality of Smith or Friedman, the Indian left invokes Hollywood. We trust your future judgments will cite reallife liberal giants.
Neo-liberalism is said to represent the abolition of nearly all regulations, leaving everything to markets. No country has such a regime and never will—governments do not come to power in order to abolish all their powers. So, neo-liberalism is a straw man. Far from being neo-liberal, India remains terribly illiberal. The 2G scandal, the Adarsh housing scam, the Commonwealth Games scam and many others are the consequence of politicians making money out of allocations, permits and contracts.
The Heritage Institute brings out an annual Index of Economic Freedom. This has long shown a strong relationship between economic freedoms on the one hand and income and lack of corruption on the other. The freest societies-—Singapore, Hong Kong, New Zealand—are also among the cleanest.
In this Index of Economic Freedom, India ranks 124th out of 183 countries. Is this really too liberal? Would we be better off becoming even less liberal and matching Togo (153rd) or Sierra Leone (164th)?
The Heritage Foundation divides all countries into six categories, ranging from free to repressed. India, alas, falls into the category “mostly unfree”. Will we be better off moving to the category “unfree”? Should we be going in the direction of North Korea and Myanmar?
Again, consider the Doing Business reports of the IFC/ World Bank. The 2011 report rates India 134th out of 183 countries in “ease of doing business”. Is it not a cruel joke to call this neo-liberal? India ranks among the most illiberal countries in the world in starting a new business (166th), getting a construction permit (177th) and enforcing contracts (182nd). Is there really a case for tightening controls and coming last in the world?
India has indeed liberalized industrial licences, import licences and foreign exchange. But in other areas, we have half-baked liberalization where permits and allocations are still needed, enabling politicians and their cronies to mint money. Full liberalization ends corruption and black money. For instance, if industrial licensing is abolished, nobody can demand or receive bribes for licences. Foreign exchange convertibility on current account has killed the black market premium on the dollar. The slashing of import duties has virtually ended the once massive smuggling of gold, electronics and synthetic fibres.
But we have moved from the old illiberalism (where everything was controlled) to a new illiberalism, where some sectors are liberalized (helping increase the economic cake), while other sectors are kept illiberal to enable politicians to extract more than ever out of an expanding economic cake. This is not neo-liberalism. It is neo-illiberalism. This is not the Washington Consensus. It is better called the New Delhi Consensus—all parties are fully agreed on continuing to making money out of a smaller but hugely profitable licence-permit raj.
We trust that in your next judgment, you will castigate this New Delhi Consensus as a cesspool of illiberalism that spawns corruption and black money. The problem is not neoliberalism. It’s neo-illiberalism.