The corporatisation, privatisation and corruption of Umno

By Raja Petra Kamarudin Last updated May 2, 2019

So, when Mahathir took over as Prime Minister, the first thing he did was make his move to turn Umno into a money-making or cash machine. Lim Kit Siang saw this and he went to court to try to block the Hatibudi-UEM-Plus Highway exercise (but failed). That corporate exercise turned into the biggest corporate exercise in Malaysia at that time. And the mastermind behind all these money-making moves was Tun Daim Zainuddin.

THE CORRIDORS OF POWER

Raja Petra Kamarudin

“Mega infrastructure projects undertaken during the previous Barisan Nasional (BN) government were actually a front to raise funds for its election campaigns instead of for Malaysia’s economic benefit,” said Council of Eminent Persons (CEP) member, Jomo Kwame Sundaram, today (READ MORE HERE).

This is not the first time Jomo talked about the corporatisation, privatisation and corruption of Umno. In fact, Jomo has written a number of books about the matter before. And, in 1999, Jomo was a strong supporter of the Reformasi movement (meaning the anti-Mahathir movement) and an adviser to Anwar Ibrahim, who was then marking time in the Sungai Buloh Prison.

And Jomo is not the only one who has talked about or written about the corporatisation, privatisation and corruption of Umno. Others have as well, the most notable amongst them being Barry Wain, a former editor of the Asian Wall Street Journal, who wrote “Malaysian Maverick: Mahathir Mohamad in Turbulent Times.”

Anyway, if I want to write about this, I would need to write a thesis (and probably would be given a PhD for the effort). And so many books have been written about the matter that I don’t think Malaysia needs yet another book on the corporatisation, privatisation and corruption of Umno. So, let me just briefly touch on the matter.

Before 1981, Umno depended on donations from Chinese towkays to fund its party activities and the general elections. The fact that the First Prime Minister Tunku Abdul Rahman was very close to the Chinese helped (and which attracted criticism from Mahathir who said that the Tunku was a Chinese running dog).

Mahathir, however, resented this Umno-Chinese arrangement because he felt if the Chinese controlled the purse strings then the Chinese invariably controlled Umno as well. And it was sort of true because many Chinese who were funding Umno obtained favours from the government and these Chinese millionaires turned into billionaires — Lim Goh Tong and Robert Kuok being just two of the more famous Umno cronies of the Tunku era who became billionaires through political patronage.

So, when Mahathir took over as Prime Minister, the first thing he did was make his move to turn Umno into a money-making or cash machine. Lim Kit Siang saw this and he went to court to try to block the Hatibudi-UEM-Plus Highway exercise (but failed). That corporate exercise turned into the biggest corporate exercise in Malaysia at that time. And the mastermind behind all these money-making moves was Tun Daim Zainuddin.

So, long before Najib Tun Razak took over as Prime Minister in 2009, Umno’s objective was to make money, plenty of money. And the architect was Tun Dr Mahathir Mohamad and the engineer Tun Daim Zainuddin. And Mahathir himself admitted that he spent about RM1.5 billion on the general elections every five years when he was in charge. And that RM1.5 billion is just for the general elections. Then you need another RM1 billion a year to fund the party, which come to another RM5 billion.

In short, if you do not have about RM6-7 billion every five years, then you cannot run the party. This is no secret. Everyone knows this. Many books have been written about it. And everyone also knows that it was Mahathir who started all this when he became Prime Minister in 1981.

Hence when Jomo says 1MDB and the ECRL were started to obtain funding for Umno and to finance GE13, he is not entirely wrong. That is true. But Jomo is wrong when he says this was done by the previous Najib government. This was done since 1981 when Mahathir became Prime Minister. And it has never been denied and everyone, especially Jomo, is aware of it. In fact, Kit Siang even went to court in the 1980s to try to stop Mahathir from doing it.

The Dayabumi project was launched to get money for Umno

I am not saying the corporatisation, privatisation and corruption of Umno is right. I am not even disputing that 1MDB, ECRL, and probably a number of other projects as well, were started to fund Umno, Barisan Nasional and the general elections. I am saying this is how things are done in Malaysia.

Since 1981, Umno and Barisan Nasional are cash cows and business entities. And all those people in PKR and PPBM were one time also part of that same system. Today, DAP and PAN have joined the club and are treating Pakatan Harapan as cash cows and business entities.

The bottom line is, anyone who is in power would abuse that power to make money. Before that, Umno and the Alliance Party depended on donations from businessmen (which would mean mostly Chinese money).

The PWTC was funded from kickbacks on big projects

But that was okay back in the 1950s and 1960s. By the 1970s, politics became too expensive and no longer can mere donations fund everything. That was when Umno had to find other ways to get money. When Mahathir took over in 1981, he turned Umno into a cash machine. He corporatised and privatised Umno, and invariably corrupted Umno as well. You cannot sprinkle sugar all over the table and not expect the ants to come.

The trouble with people such as Jomo is they keep talking about the symptoms of the disease. We would expect a man of Jomo’s calibre to understand the difference between the cause and the symptoms of the disease. 1MDB and the ECRL are the symptoms of the disease, not the cause. The cause is the corporatisation, privatisation and corruption of Umno back in 1981, which Jomo’s Boss, Mahathir, created.