Wednesday, August 6, 2008

Disaffirmative Reaction

Dr Mahathir recently wrote on his blog on justifying the NEP:

I came in for virulent attacks because some Malays actually did well in business. They were all labelled my cronies whether they were indeed my cronies or not. Anyone who succeeded was immediately defined as my crony. Many close friends, relatives and members of my family who failed in business would not be called cronies.

Well, that's a valid point. The point, that is, that not everyone in your family or your close circle of friends were cronies. Which, sad to say, does not rule out that some may have been. The point really is that cronyism has to be proven, and the only proof is whether the people who receive contracts actually deserve them - since the concept of meritocracy is the litmus test of fairness, one's very choice of using the NEP invites claims of cronyism which by the nature of the NEP cannot be convincingly proven as false.

As head of the Government I had to ensure the success of the NEP objective of reducing the disparities between the bumiputeras and the non-bumis. This reduction must be achieved at all levels, not excluding the rich and the very rich. It wouldn't do to have parity among the low income and middle income only, while big businesses are all in the hands of the non-Bumiputera millionaires.

Fine. But don't forget that not all of the non-Bumis are millionaires. Or that all of us - both Bumis and non-Bumis - suffer when anyone gets millions for nothing.

The number of successful Bumiputera businessmen slowly increased. Angry that the NEP had actually succeeded in throwing up capable bumiputera businessmen and reducing racial imbalances the Western press and local opponents of the NEP began to label all the successful Bumiputera businessmen as cronies of the Prime Minister. It does not matter if the PM had never known these people, but if they succeed then they must be the cronies of the PM.

It would seem that the only way to avoid being accused of cronyism is to ensure that all Bumiputeras fail in business. Better still the NEP should be made to fail completely.

Things really depend on your perspective at this point. You provide certain people with contracts and all they have to do is fulfill their obligations and responsibilities to "succeed". There's literally no competition, no even ground, and no sense of having excellence as the yardstick to success. Pass is enough, no need to get A, is basically the message. And at the cost of many who not only don't have automatic contracts, but no equal opportunity to compete for them. Here's an idea: instead of giving contracts, give skills! Which, by the way, they are already doing at our universities. Then put everyone on a fair playing ground and those who truly succeed can feel that it's earned. This is beneficial for truly industrious Bumiputeras as well - that their success will be seen for what it is: hard work.

The continuing disparities between the Bumiputeras and the non-Bumiputeras which these will cause would then produce inter-racial tension and political instability. Then the Western journalists can say that these "natives" really should not be given independence. Look at the mess they are making of their country.

I have yet to have heard a Western journalist say that we should not have been given independence, and I think that one should substantiate that with proof. Plus, it's not to say that the NEP doesn't cause inter-racial tension, it's just that it creates a different kind of tension.

But the NEP was more successful in the field of education... In my class of 1947 at the Medical College there were only seven Malay students out of a class of 77. Even in the arts faculties the percentage was very small... The results of all these efforts is very satisfying... They have also gone into management, obtaining MBAs from well known universities such as Harvard and Philadelphia. Armed with these qualifications they have been employed as management executives at all levels. Some actually head multinational companies.

In the education field the NEP has been very successful. It has helped to correct the imbalances not only in the professions but also in business. Strangely Malays have become very successful bankers.

Again, fair point. So long as the recognition of our degrees is the same relative to other institutions as yours of the class of 1947. It is nice to point out those who have taken advantage of educational opportunities and correcting imbalances in that respect - so long as it is not at the expense of creating imbalances elsewhere. Like allowing thousands to enter and graduate who don't work hard to earn their local-university degrees, and thus lowering the respect of that degree for all those who put in some effort. Which, again, detriment anyone who works hard - non-Bumis and Bumis alike.

Tun, since you mentioned the idea of management, let me summarize this by putting forward a basic economic concept: it's not just about opportunity... it's about opportunity cost.

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