Dummy’s View of the Mini-Budget

Najib’s mini-budget is certainly a shiocker! He has certainly upstaged Pakatan by planning to spend such a huge amount of money. At the very least, he has bought some time for himself since people need time to see if his stimulus packages really work. By adding this the recent talk of a peace deal between BN and Pakatan in facing the economic crisis together for the sake of the rakyat, this mini-budget as a propaganda coup is hard to beat.

As the old saying goes, if you can’t beat them, you might as well join them. The best way to put people’s guard down is to wave lots of money. However there must still be a few questions asked, potential abuses investigated carefully and niggling doubts monitored closely in case we are taken for a ride again.

Since it is quite a shock, people must find it difficult to believe, so some questions are in order. Otherwise it is just a propaganda ploy pure and simple.

Where will the money come from to pay for all this?

Who will eventually foot the bill in the years to come?

Can we afford it – since any fool knows that spending beyond one’s means is a sure way to get into trouble?

Is it being spent wisely in the most appropriate areas?

Will there be abuses (cronies get most of it), wastages (incompetent implementation) and “siphoning off” (theft) since it is difficult to track huge amounts of money being spent in a short time.

The answers to the above questions will give a rough idea whether the stimulus packages will work or not.

Obviously the money has to come from national debt, national income and whatever reserves we have. From this if national income is insufficient due to the ongoing economic crisis or stimulus packages not working, the national debt is bound to increase. If this happens it is going to be bad news for all.

Again obviously the people who will foot the bill in the end will be those who have some disposable income and “expropriatable” savings in the banks or in assets in this country. (It won’t be me)

At the moment our national debt is about 4% of our GDP. These stimulus packages will make it above 7%. However, GDP is variable. If due to the economic crisis, our GDP drops by 20%, our debts will increase to about 10% as a percentage. This sounds still OK on paper, but on the ground it will be a torture since we will also be burdened with unemployment and a shaky economy in poor shape and hence unable to generate too much income. Will we then be able to pay off our debts without suffering extra-economic measures? We have already shown a tendency to use extra-judicial and extra-constitutional measures recently – why not extra-economic measures to save our own country? I guess most patriotic Malaysians will not mind.

We also need to make sure the money is being spent in the best areas. This means the most strategic areas to safeguard our strategic industries and strategic manpower which will enable us to carry on and survive. The ministers are smart enough to say that the money won’t be spent on importing immigrant labour if our own people are going to be unemployed in droves. Will the money be used to shore up foreign owned businesses and foreign direct investment? And why not – since they may be part of our strategic industries after all? Did not the govt. go all out to seduce them to come here in the first place? If they are not strategic, why go to the trouble to attract them to this country?

Do we have an idea of what is strategic for us in the first place? If not, a lot of the spending will be misdirected and not purposeful. This will just make it easier for crooks to get their hands on it.

I guess, as to the last question, most Malaysians already have a fair answer or at least have their very own very strongly-held opinions, so I need not waste more time and effort here.

– By batsman