Let it be the wealthiest 1% who lead this campaign and let the fund be used for lifting the bottom 40% out of their poverty trap, writes Kua Kia Soong.
The prime minister has started a ‘Save Malaysia Fund’, ostensibly to help plug the apparently RM1 trillion debt gap by calling on “patriotic Malaysians” to contribute to the fund.
First, there is dispute between economists as to the actual size of the national debt depending on whether we include government guarantees and lease payments under public-private partnerships.
Then, it is clear that two important issues need clarifying:
- how will such a ‘Save Malaysia Fund’ be used?
- who are best positioned to lead this noble drive to “save Malaysia”?
What are we saving Malaysia from?
During the election campaign, Pakatan Harapan (PH) leaders made it clear that they could solve the economic problems of Malaysia as long as they were in charge and the country could be saved from the rotten Barisan National government.
After the general election, the new finance minister reiterated the fact that the new government could solve all the accounting problems despite the abolition of Goods and Services Tax. Just the other day, they could pull RM40m out of the hat to pay for televising the World Cup.
So what is RM145m to pay off the 1MDB bond coupon payment that is due soon? I am sure the wealthiest persons in the Council of Elders can easily write a cheque for that paltry sum considering how much they are worth.
So what is this ‘Save Malaysia Fund’?
Unless the new government specifies the specific purpose of this so-called ‘Save Malaysia Fund’, who knows how it will be spent? This is Transparency 101.
I propose that considering the dire plight of the indigenous peoples and B40 in our country, this fund should be called the B40 Fund and specifically used to uplift their livelihood in a noble attempt at wealth redistribution in our society and to bring us into the high-income bracket.
Forbes 50, top 1% should lead the donations
It is a no-brainer that it should be the Forbes 50 wealthiest persons and the top 1% in our society who should show us how to “save Malaysia” from the supposed debt hole.
Since Robert Kuok is in the Council of Elders and is none other than THE richest man in Malaysia with a net worth of RM60bn, he is well suited to lead the donations.
Daim Zainuddin, the chairman of this council, is certainly one of the richest Malays in Malaysia; and he too can lead by showing us how much he is prepared to donate to this fund. In 1984, his total net assets were already estimated at nearly RM1bn.
Besides these two of Forbe’s wealthiest, Prime Minister Dr Mahathir Mohamad’s eldest son Mokhzani Mahathir is among Malaysia’s 50 richest with a net worth of more than RM1bn and his other son, Mirzan is certainly among the top 1% wealthiest Malaysians.
To remind Malaysians, Malaysia’s 50 richest individuals (or the top 0.0017%) have a total wealth of US$70bn or more than RM280bn while the total wealth of the bottom 40% in our society (B40) is only RM20bn!
In other words, income inequality is getting worse and there is no proper welfare system for Malaysians, the majority of whom do not earn enough to be able to have a retirement, never mind the others who lose their jobs or are retrenched. Thus, we can ‘save Malaysia’ by using the fund for a public social security or retrenchment fund for workers.
Wealth redistribution is crucial to save Malaysia
For too long, the government of the day has never had the political will to initiate wealth redistribution and to narrow the gaping income inequality in this country. Surely it is time for this government of Hope to initiate this and to ensure that this fund is not siphoned off for other purposes?
Not just donations but progressive taxation
Ultimately, donations by the wealthy and charitable philanthropy will not solve the problem of growing income inequality either. The increasingly serious gap in income inequality needs to be addressed through progressive taxation on the high-income earners, their property and capital gains and effective tax laws to ensure there are no tax loopholes for the super-rich top 1%.
Rigorous legislation is also vital if we are to curb the practice of transfer pricing that enables the largest corporations to stash their profits in off-shore tax-free havens. Capital allowances and tax holidays for foreign firms must be reviewed while a tax should be imposed on all international financial transactions and hedge funds.
So, if we should have a ‘Save Malaysia Fund’ to save the nation from this debt hole, let it be the wealthiest 1% who lead this campaign and let the fund be used for lifting the B40 out of their poverty trap and bring us closer to becoming a high-income society.
Dr Kua Kia Soong is adviser of human rights group Suaram.