A historical mistake
by Wong Chin Huat, The Nut Graph
THE greatest political myth in Malaysia is that Malay Malaysians and other bumiputera owe their success or improved living standards to three things: the New Economic Policy (NEP), Umno and the 13 May 1969 clashes. Without 13 May, Umno would not have been resurrected and obviously, there would not be the NEP.
Myths are not lies. A myth is only a half-truth or misinterpretation of truth. It is not that Malay Malaysians have not gained from the NEP’s implementation. It is instead that Malay Malaysians could have gained more if the nation had chosen other paths after the 1969 racial clashes.
In that sense then, Malay Malaysians owe nothing to Umno and the NEP. In fact, the NEP was a historical mistake. Is this argument speculative? Yes. But it is no more speculative than claims that Malay Malaysians could not have been successful and affluent if not for Umno.
Free market flaws
That the NEP was a historical mistake can be argued by looking at the conditions a young Malaysia faced in the late 1960s. By then, the laissez-faire or free-market model was no longer sustainable for our nation.
Even if the Alliance did not lose control of Penang, Selangor and Perak in the 1969 elections, the poor’s demand for economic redistribution would still have grown stronger by the day. For certain, the Malay electorate’s disenchantment was on the rise in the late 1960s. Of the total votes in the peninsula in 1969, there was a swing from 15% to 24% from Umno/Alliance to PAS [updated] most likely among Malay Malaysian voters. The support for non-Malay-based opposition parties among peninsular voters, meanwhile, remained unchanged at 26%.
Later incidents like the 1973 starvation of Baling farmers were pointed indicators of flaws within the laissez-faire model. This model would sooner or later have been terminated by a class revolt if an ethnic riot had not occurred.
Meritocracy vs affirmative action
How did meritocracy – the distribution of wealth in a free market which rewards individuals on their merit – fail?
Firstly, competition requires level playing fields. Hence, if certain groups are historically or structurally discriminated or marginalised, such as India’s lower castes or African Americans, their potential cannot be unleashed. Competition that is not moderated may mean that the weak can never move upward in society.
Secondly, even uncompetitive people deserve to live. You don’t let people starve simply because they are less productive. Competitiveness or productivity is required only of the competent. Social Darwinism, if you like, has to give way to fraternity.
These two flaws of meritocracy need two different policy tools: affirmative action and a welfare state. Affirmative action, which is more often based on non-socio-economic criteria like ethnicity, gender, disabilities and urban-rural divide, is meant to help minorities who are specifically disadvantaged.
In contrast, however, if the disadvantaged group constitutes a majority such as in Malaysia, then a welfare state would be needed to redistribute society’s wealth towards the economically weak through for example, subsidies or direct handouts.
For example, if some university places are reserved for poor students, poor rural students may systematically lose out to poor urban students because rural schools are worse equipped. Similarly, rich rural students will systematically lose to their urban counterparts.
To correct this, rural schools should be given some weightage on top of family income. However, if 80% of the students are rural, then improving all rural schools is more important than cherry-picking a few smarter rural kids.
Alternatives to NEP
At first glance, the NEP’s two-pronged goal of “restructuring society” and “eradication of poverty” seems to be the answer to the flaws of a naïve meritocracy. In reality, these are competing ends. Additionally, we may have at least three policy alternatives to the NEP depending on how we rank class and ethnicity.
