Liberalisation will fail without social justice

JULY 6 — In 2005 Datuk Seri Anwar Ibrahim made a bold announcement that the New Economic Policy had to be replaced. The announcement shocked both friends and foes alike, who felt that — for whatever the statement’s merits — criticising the NEP was a political misstep.

The BN machinery went into full gear, claiming that Anwar had made a dreadful miscalculation and playing up its narrative that Anwar was a stooge of the West. Now — at least to the Malay community that supported Anwar in a big way in 1999 — they could paint him as pro-Chinese as well. The brainwashing camps of Biro Tatanegara (BTN) were now given more ammunition to convince students and government servants that Anwar was a threat to the country.

But many Malaysians were excited by the development. For my own part, I felt (and still feel) that eradication of race-based policies was the logical extension of the Reformasi movement. I was after all involved in drafting the motion tabled at the 2005 Keadilan congress which spoke of the need to replace the NEP with a Malaysian Economic Agenda that combined liberal market policies with a strong sense of social justice through needs-based affirmative action.

I joined Anwar’s office the next year, and by 2007 Anwar had drafted a pamphlet that fleshed out his perspective on why the NEP — while playing a big role in confronting the challenges of the racial inequalities that we faced in the 1960s and 1970s — had now been hijacked to keep us bound to the state for all things as the political elite took it as an opportunity to enrich themselves all in the name of “Malay interests”. Central to Anwar’s argument was a graph showing the growing gap between nations that had been our peers in the 1960s — Singapore, Korea and Taiwan. Now, Singaporeans on average earn five times more than Malaysians.

Anwar’s boldness was vindicated by the results of the March 8, 2008 general election. For my part, I spoke in my campaign in Seri Setia not about what we should fear from one another, but what we can do together. I spoke not only about Malay welfare, but about the need for Malay, Chinese and Indian issues to be seen as Malaysian problems that concern us all as citizens of this blessed country. Umno’s arguments that Malaysia was not ready for this were proven wrong.

Umno’s response has exposed their leaders’ collective schizophrenia. They use Utusan Malaysia to stoke racial tempers while appeasing the non-Malays that things will change, culminating in Datuk Seri Najib Razak’s 1 Malaysia slogan. Finally Najib accepted Anwar’s argument that Malaysia needs to go beyond the NEP, and has announced liberalisation measures to prove his point.

The first round included liberalisation of 27 service sub-sectors, whilst the recently-announced second round included the lowering of the Bumiputera equity quota as listing requirements and the rolling back of the powers of the Foreign Investment Committee.

I wonder how the spin doctors at the PM’s office will instruct the BTN to justify these policies. Najib’s first round of liberalisation measures exposed BN’s divide and rule tactics to the fore — while the English press spoke about removal of Bumiputera quotas, the Malay press — Utusan Malaysia included — only spoke about local quotas. This exposed that beneath the PR blitz of 1 Malaysia, BN still has not abandoned the old way of doing things.

I’m not saying that Malaysia isn’t in need of measures like these. Accepting the reality of liberalisation is crucial for Malaysia and the Malays to move forward. Markets are an important wealth-generating mechanism, with a major role in the economy. I accept that. But it must not be done with a sleight of hand or to simply hijack Pakatan’s agenda, but to openly make the forceful argument with the courage of conviction.

Najib and his cohorts have to actually believe in liberalisation in order for it to work. I wonder if they genuinely understand the benefits that really opening up the country, not only economically but socially and politically will bring — or are they just fishing for votes? If Umno/BN is sincere about liberalisation, then they can’t be content with these two thrusts but continue to push the envelope, in all areas of our national life — Pakatan Rakyat is more than willing to do so if given the chance.

These measures look good on paper, but the devil will be in the details.

What are the guarantees that it will not be simply “business as usual” on the ground, far away from the confines of Putrajaya? Malaysians have seen too many cases of bold pledges and initiatives wither away because of shoddy implementation and the lack of political will.

In fact it was Umno’s previous obsession with equity quotas that exposed how much the political elite benefited from such policies when it meant little to the ordinary Malays — the fishermen, the farmer and the factory worker — who were supposed to be the NEP’s main beneficiaries. After all, the NEP’s main contribution has been the creation of a Malay middle class through education and training, not solely quotas that Umno Youth leaders constantly harp on — as when Khairy Jamaluddin stated at the 2006 Umno Youth assembly that the NEP’s quotas should not be 30 but 70 per cent instead. We need capacity-building, not get-rich-quick schemes.

Hence, while we accept the need for a liberalised market, we need to look at the other important elements to be a developed nation. This includes an effective education system that caters for both for the brightest Malaysians as well as those who are left behind, an accessible and efficient healthcare system and an administration run on democratic principles that are competent, accountable and transparent.

We are being held back by archaic regulations and corruption, venality as well as inefficiency in all these areas. Where are the liberalisation measures here? We await them with bated breath — and Pakatan’s stand on these areas ought to be clear enough for anyone who has read our various manifestos.

Furthermore, any move to liberalise the market should be done in tandem with ensuring social justice for all Malaysians as well. Without going together, the great inequalities in our society today will exacerbated. Malaysia already has a very unequal society, and disparities within the Malay community are far bigger than other communities. Malaysians — regardless of whether they are Malays, Indians, Chinese or Ibans — at the bottom of society will not be able to rise up and enjoy the country’s development and progress if there is no imperative for the welfare of the people in our policies.

One does not have to go far to realise the plight of ordinary Malaysians. In my constituency, every week dozens of my constituents come to me to ask for welfare assistance. Some are elderly, abandoned by their children. There are single mothers left behind with children by their philandering husbands.

Yet when we forward their names to the Welfare Department, most end up frustrated by the extremely narrow definition of deserving beneficiaries and the red tape involved in order to qualify for aid. Most are disqualified on the smallest pretexts. While the Muslims have access to payments related to zakat, the non-Muslims do not.

I’m not sure how abolishing the FIC guidelines and the liberalisation of the rules related to the ownership of financial institutions will help cases like these. The lessons from the last two decades all over the globe have informed us well and truly that trickle-down economics doesn’t work.

One isn’t advocating that Malaysia construct a nanny state, and indeed having overgenerous welfare provisions are not healthy either. Nevertheless, some form of universal social safety net that compels and empowers its recipients to go back to work (such as the welfare-to-work programme in the US) can provide for effective social security in a market economy.

The Umno/BN government has been unable to provide this despite their claims to the contrary. The latest slew of faux liberalisation policies increases the worry that the poor of Malaysia will be further neglected. It will be just awful if the liberalisation policies end up not really making it easier to do business or invest in Malaysia, and also lead to more social inequality.

We have to concede it is commendable that the government is embracing a brand of change that was until just recently termed as a betrayal to the Malays. Yet without addressing the other issues of governance, and indeed that of mindsets, in a comprehensive manner, liberalisation will not be the panacea to our nation’s many woes.

Nik Nazmi Nik Ahmad, is the political secretary to the Selangor mentri besar and state assemblyman for Seri Setia. He was the youngest elected representative in the 2008 general election and blogs at www.niknazmi.com.