A State of Delusion, Confusion or Corruption?

ARCHIVES 2010

By admin-s On May 31, 2010

We have to worry over the possibility of being a bankrupt country or rejoice that we can be a developed nation by 2020 or worry and fret over the damning occurrences of leakages and the possibilities of an imminent rise in our cost of living?

By Masterwordsmith

Last week, many sites focused on the statement by Datuk Seri Idris Jala (this link has 220 comments at the point of writing!) about how the nation could be bankrupt in 2019. This morning, The Malaysian Insider reported HERE that our PM said that “Malaysia can be a developed nation by 2020, if the country registers a continuous six per cent annual growth“.

In the first article, Idris Jala, a minister in the PM’s department who heads the body advising the government, said Malaysia risks becoming the next Greece unless voters swallow subsidy cuts that will see the price of petrol, food, electricity and other staples rise. He also said that Malaysia’s debt would soar to 100 percent of gross domestic product by 2019 from 54 percent of GDP at present without the cuts. The article stated that Malaysia spent 15.3 percent of total federal government operating expenditure on subsidies in its 2009 budget when its deficit surged to a 20-year high of 7 percent of the GDP.

FYI, THIS SITE @ Bank Negara Malaysia reveals that our National Debt (last updated on 27th May 2010) states that our national debt is at RM362 billion – a record high indeed – no wonder Datuk Seri Idris says that our nation is on the brink of bankruptcy. If that occurs, would we be classified as a fourth world country? Wikipedia defines fourth world nations as countries that “suffer conditions of extreme poverty, ongoing and widespread conflict (including civil war or ethnic clashes), extensive political corruption, and lack political and social stability. The form of government in such countries is often authoritarian in nature, and may comprise a dictatorship, warlordism, or a kleptocracy.” I hope we will not degenerate to that level!!!

In sharp contrast, our PM said HERE :

“To achieve this goal, we need to enhance economic growth. We must achieve the six per cent annual growth and God willing, by 2020, we can achieve the status of a developed nation,” he said at the closing ceremony of the Bumiputera Economic Congress: New Economic Model 2010, here yesterday. CLICK HERE for more.

Don’t forget the cry of one supposedly retired politician OVER HERE about how the scenic bridge project to replace the causeway connecting Malaysia and Singapore should be pursued.

Assuming that Datuk Seri Idris Jala is correct and our country is bankrupt by 2019 based on trends and statistics, how then can we maintain the 6% annual growth if subsidies are removed as proposed? If the doomsday prediction of 2019 comes true, can we in one year become a developed nation by 2020? Is there any economic guru out there who can clear the air?

Are we living in a nation that is floating on delusion or spinning in confusion or dying from corruption while delusion and confusion reigns? Me thinks it is all three!! What we see are contradictory statements which do nothing to add to investor or voter confidence. Some say the subsidy cuts can boost competitiveness and appeal to foreign investors although it may be “political football”.

Let’s consider the scenario before us.

1.Thus far, the government has yet to come out with statements to address the gravity of our national debt as highlighted by Datuk Seri Idris. There is no clear statement by the Finance Minister to explain how on earth our national deficit could reach such a humongous figure that it is almost half of our GDP? Such a scenario does not mushroom overnight. The government has a fiscal responsibility to be good stewards of the country’s $$ and resources. So have they told us how we arrived at this horrible scenario? Why can’t there be some admission that there could have been years of negligence and spending like a BIG SPENDER as though tomorrow might never come and that they do not have to account to the rakyat for the state of finances?

2. We have not heard any suggestion/proposal as to how the government intends to address the problem of unwanted leakages. Year in and year out, we hear of damning disclosures from the Auditor-General but do we ever hear from the government as to how these problems are going to be dealt with and who is responsible for such spending that demonstrates absolutely NO prudence or fiscal responsibility?

3. What new fiscal/economic/policy changes has the government made which DOES NOT penalize the rakyat as in GST and removal of subsidies? If something is wrong because of someone or a department, then those responsible must pay for those colossal errors and NOT the rakyat!!!

4. Yes, subsidies have been given but if we look at the bigger picture, who benefits the most from the subsidies? The poor or the big corporations/businesses/conglomerates such as IPPs etc after which we still do not enjoy lower prices. In the law of demand and supply, when subsidies are given, the supply curve shifts to the right thereby lowering prices.

5. What about investigations into cases whereby some characters have demonstrated that they have opulent homes while in office or demonstrating a meteoric rise in corporate success etc? Even though quite a number have lodged police reports against these characters, why are the authorities slow to act?

6. What about other excesses in public expenditure such as :

* RM20 million on a Apco Worldwide, an international public affairs and media relations company, to boost the government’s image overseas.

* The proposed purchase of 257 armoured personnel carriers (APC) for a total of RM8 billion.

* The contract awarded to Syarikat Visi Footwear Sdn Bhd for supply and delivery of leather shoes for women civil servants in the ministry originally priced at RM27.5 million and then later adjusted to 6.5million RM.

* The 6.5billion RM contract for food which was later corrected to 6.5million RM which you can also read HERE.

* The loss of more than RM 1.4 billion in Rawang-Ipoh double-tracking project. (CLICK HERE for the 2005/2006 Economic Report)

* The collapse of the roof of the RM300mil Sultan Mizan Zainal Abidin Stadium in Gong Badak .

* The collapse of ceiling panels at the Jalan Duta Court Complex

* The collapse of Perak State Parks Corporation Complex in Pulau Banding

* The construction of Kuala Lumpur Courts Complex at a final cost of RM290 million. Click HERE to read the detailed report.

* The loss of RM28 billion through excessive payments for contracts and procurements as announced in the Auditor-General’s Report.

* The fact that RM2.37bil has been spent to finance the national service (NS) programme since it was introduced in 2004.

* The Port Klang Free Trade Zone RM12.5 billion loss.

* The RM70 million (originally priced at RM 490million) Brickendonbury Sports HPTC and establish an inquiry to ascertain who were responsible for the folly of wasting RM2 million in pursuing the project and who had really benefited.

* The Budget 2010 allocation of RM394 million to compensate toll concessionaires for not raising toll rates without remembering that the government had also paid RM180 million in 2009 and RM380 million in 2008 under the Works Ministry as similar compensation.

What IS the government doing to arrest all those problems and other expenditure such as the ones on submarines and other unnecessary expenditure which caused serious leakages in our circular flow of income?

And now, we have to worry over the possibility of being a bankrupt country or rejoice that we can be a developed nation by 2020 or worry and fret over the damning occurrences of leakages and the possibilities of an imminent rise in our cost of living?