Going Rogue: Malaysia and the 1MDB Scandal
Democracy and rule of law won’t magically clear society of cronies and corruption.
Danny Quah, The Diplomat
In 1971, more than forty years before the world would turn its attention to the so-called one percent and the problem of income inequality, Malaysia embarked on one of history’s boldest and most noble experiments to reduce social disparity. Malaysia’s New Economic Policy, or NEP, would seek to “eradicate poverty for all” and “eliminate identification of race by economic function and geographic location.” This polity that had achieved national independence just over a decade before, this country that was still a low-income emerging economy, was setting out to solve the massive problem of injustice and inequality over which other societies much more mature continued to struggle.
Malaysia was a democracy that hewed to the rule of law. The NEP would be Malaysia’s key political driver. Over the decades that followed, the NEP’s mantra would serve as a backdrop to almost all political discourse in the country. NEP-themed policies would, among much else, flesh out the concept of Bumiputera – an ethnic-driven formulation of native peoples in Malaysia.
It is difficult to grow an economy – look at train wrecks strewn around the world. But seeking to do so and at the same reduce ethnic- and rural-urban inequality, and maintain social harmony among diverse ethnic and religious groups is an order of magnitude more arduous. Malaysia succeeded: From tropical jungle, Malaysia has grown to have an average income now well above the world emerging-economy average. Its urban infrastructure and worker skills approach those in the first world. Malaysia’s top bankers, businesspeople, and entrepreneurs are admired everywhere. NEP reduced pockets of extreme poverty and created a significant, thriving, and successful Bumiputera middle class – a group of professionals and intellectuals whose contributions to Malaysian society would be the pride of any country.
And, although from time to time patchily diverging from the ideal, throughout this history Malaysia worked hard to maintain its young democracy and its adherence to rule of law, and to support a healthy vigorous open sphere of public debate. Sensitive racial questions were out of bounds, but open questioning of the government was lively. Top government officials routinely had the judiciary rule against them. And a national identity emerged, one that combined the best aspects of local culture and an easy-going, open-minded cosmopolitanism developed from, among other things, the many Malaysians who have seen significant international experience. More so than when at home, Malaysians outside Malaysia saw each other for the warm and lively friends they genuinely were for one another, people who felt driven by a mission to make their country better.
Since his 2009 swearing-in, Malaysia’s current prime minister has sought to articulate an international vision for a “coalition of moderates.” As leader of a successful moderate Muslim country, he carried an authority and credibility sorely needed in global discourse. He was widely accepted in international circles, and even famously golfed with Barack Obama.
All this is now at risk.
