Corruption, fragmentation and the collapse of Umno-BN … Whither Vision 2020?

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We might have entered into a period of transition and uncertainty that could last about a decade, Francis Loh writes in the second of a two-part series on New Politics in Malaysia.

The principal cause of Malaysia’s current political predicament is the implosion of Umno. 

Prior to this, we witnessed too, the near disappearances of the MCA, Gerakan, the MIC, the People’s Progressive Party and the rest of the 14 parties including those in Sabah and Sarawak associated with Barisan Nasional. 

Put another way, Umno-BN (or its predecessor, the Alliance), which had won every single general election in Malaysia since 1957, has collapsed.

Not that Umno-BN was so central to the functioning of our political system – its importance was exaggerated. It was important for political stability only because so many other political and social institutions in Malaysia had been undermined or compromised. 

As mentioned in part one, the Judiciary, the civil service and the police under the Executive, the workings of Parliament, and so on, had all been compromised. They were no longer competent, accountable and transparent.   

The trigger point of the Umno-BN’s collapse was the unprecedented corruption within the party. The rot had set in at the very top. 

As the entire world now knows, former Umno president and Malaysia’s sixth Prime Minister, Najib Razak, was found guilty of seven corruption-related charges in July – abuse of power, three counts of criminal breach of trust and three counts of money laundering. 

Najib was convicted of pocketing RM42m from Ministry of Finance-owned SRC International Sdn Bhd between 2014 and 2015, when he was finance minister and prime minister. The sentence: 12 years’ imprisonment and a fine of RM49m. Alas, he has not yet been imprisoned pending his application to the Appeal Court. 

Although Najib is undergoing another trial, he has also been engaged in many of the political intrigues mentioned above.

Umno leader Ahmad Zahid Hamidi, who replaced Najib, is himself awaiting trial for corruption. So too several other Umno leaders like Tengku Adnan Mansor, Isa Samad and Lokman Adam. 

The rakyat must be congratulated for smelling out this rot. So, a majority cast their votes for regime change in the May 2018 general election. For the first time in Malaysia’s political history, Umno-BN was voted out. 

A new opposition coalition, Pakatan Harapan, came to power. On this occasion, a previous opposition coalition – comprising PKR led by Anwar Ibrahim, the DAP led by Lim Guan Eng, and Amanah led by Mohamad Sabu – cooperated with the fledgling Bersatu. 

The newly registered party was helmed by Dr Mahathir Mohamad, the nation’s fourth PM and former Umno leader. Mahathir had led a faction critical of Najib’s corruption, out of Umno. 

Mahathir’s major role, it appears from hindsight, was to draw Malay support away from Umno, which would allow the opposition parties to squeeze through a victory. 

For his efforts, all four opposition parties agreed Mahathir would get the first shot at becoming prime minister. He would then pass the reins over to Anwar Ibrahim in mid-term, all four parties also agreed. 

Whatever our attitude towards Mahathir since the 2018 election, he played a major role and contributed towards the collapse of Umno. 

A related, more structural explanation for Umno’s collapse is the fragmentation of the Malay community. This has been late in coming. The Chinese, Indians, Kadazandusuns and Dayaks have all been fragmented for some time now as the educated middle-class components of each ethnic community grew. 

Malays too were fragmented once upon a time. Recall how, in the struggle for Merdeka, Malays were divided into three groups: the secular nationalists in Umno, the Islamic nationalists led by Burhanuddin al-Helmy, and the socialists of various persuasions from those in Parti Rakyat led by Ahmad Boestamam to those like CD Abdullah and Musa Ahmad who worked with the communists. 

These divisions disappeared in the immediate post-Merdeka period as Umno pushed for Malay unity under the banner of “bangsa, bahasa dan agama”. By assuring Umno supporters a share of the benefits of the New Economic Policy beginning from the 1970s, Umno facilitated Malay unity far longer than the Chinese, Indian, Kadazandusun and Dayak leaders could. 

But this unity, held together by patronage and sharing the largesse of the NEP, has been broken. A quick count shows that the Malays are split among at least eight political parties in the federal and state legislatures: 

  • for Umno and Pas as before
  • for PKR and its reformasi agenda
  • for Amanah and its maqasid sharia programme
  • a small group for Muhyiddin’s Bersatu
  • an even smaller one for Mahathir’s Pejuang
  • for Parti Pesaka Bumiputera Bersatu (PBB) in Sarawak
  • for Warisan in Sabah

And let us not forget there are elected Malay representatives under the DAP banner too.

As well, many middle-class Malays nowadays remain outside any political party. They are more comfortable engaging in politics through NGOs like Maju, Gerak (Malaysian Academics Movement) and ABU (Asalkan Bukan Umno). 

Significantly, Umno and Pas are attempting to draw the myriad factions under the Islamic umbrella of Muafakat Nasional, yet another coalition. 

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In the event, it will be impossible for them to recreate the hegemony over a majority of Malays like Umno could previously. The Malays, like the other ethnic communities, have become fragmented. 

The unprecedented widespread corruption during Najib’s watch shattered the trust that prevailed between leaders and led. Malays will not be duped by Malay leaders like Najib again. There has been a reformasi movement. And Mahathir, willy-nilly, has helped the Malay rakyat to awaken to the Umno leader cheats too. 

Where do current political developments leave us?   

Recalling the turbulence of the 1970s transition

I see perhaps a decade-long period of transition, like in the 1970s. Then, following the May 13 racial riots in Kuala Lumpur, an emergency was proclaimed throughout Malaysia. Parliament was suspended from May 1969 until February 1971. 

When Parliament was reconvened, many new laws and policies were pushed through. 

There was the amendment of the Constitution, consistent with the amended Sedition Act that disallowed public discussion of “sensitive” issues related to Malay-Muslim pre-eminence in the country and the citizenship rights of non-Malays. 

The new educational policy also paved the way for the transition to Malay as the sole medium of instruction in all schools, and later the public universities too, apart from the national-type schools. 

The Alliance was expanded to become Barisan Nasional, with Umno as the first among equals. The National Cultural Policy and the Rukun Negara were introduced. 

Finally, the New Economic Policy, with its two prongs – to eradicate poverty regardless of race and to restructure society so that occupations were no longer associated with race – was deliberated during the emergency and passed as soon as Parliament was reconvened. 

This realignment of parties, the proposed policies to restructure society and the new curbs on politics had knock-on effects and led to at least a decade of turbulence. 

Within the Chinese community, a “Chinese unity” movement developed in response to the NEP and other new turns. Young Turks challenged elderly MCA leaders like Tan Siew Sin, Khaw Kai Boh and Kam Woon Wah. 

Ultimately, most of the Young Turks were expelled. So Lim Keng Yaik, Paul Leong, TC Choong, Tan Tiong Hong, Alex Lee and Douglas Lee all joined Gerakan. 

Gerakan, meanwhile, had realigned after the May 13 racial riots. Dr Lim Chong Eu took the party into BN while Dr Tan Chee Khoon left to form Pekemas. (Prof Syed Hussein Alatas and Prof Wang Gungwu retired from politics.)

So, with the entry of the former MCA Young Turks, Gerakan, originally touted as a multi-ethnic party, became an alternate to the MCA.

Within Umno, realignments occurred too, resulting in the ouster of the first PM, Tunku Abdul Rahman, the ascendancy of Abdul Razak Hussein as the second prime minister, and the temporary expulsion of Mahathir and Musa Hitam who had led the Umno Young Turks against Tunku. This was a period of doubling down within Umno, especially after the sudden deaths of Razak and his deputy Dr Ismail Abdul Rahman. 

In 1973, Pas joined BN and Pas leaders were appointed as federal ministers. However, its state assembly members withdrew support for the menteri besar, who had become increasingly drawn to Umno. 

Ultimately, Pas was expelled from BN and an emergency was proclaimed in Kelantan. The pro-Umno menteri besar formed Berjasa, a new party, and governed Kelantan with Umno’s support, until a new team of young Islamists began to take over the party in 1981.  

The 1970s also witnessed the biggest ever student uprisings in the country. Perhaps they were influenced by students rebelling elsewhere – in neighbouring Thailand, Indonesia and South Korea; in Europe and the US. They accused the government of neglecting the plight of farmers, workers and urban pioneers (squatters). The result was the arrests of students including a young Anwar Ibrahim under the Internal Security Act. 

To control students, the Universities and University Colleges Act (UUCA) was promulgated. Henceforth, the securitisation of universities became a priority. The campuses were fenced up for the first time and security guards were recruited in large numbers. Student unions were disallowed and student activities, especially fundraising, were curbed. 

It was also in the 1970s we witnessed the emergence of the dakwah movement. Initially, it was clearly a radical movement and a continuation of student activism under the auspices of Islam. Subsequently, the movement was taken over by Islamists and focused on Islamic reform. 

Meanwhile, as a result of the NEP, new laws like the Industrial Coordination Act 1975 (ICA) and the Foreign Investment Committee regulations were introduced. These aimed to regulate businesses to ensure compliance with NEP quota requirements. 

The original ICA required any manufacturing firm which had share capital of over RM100,000 or which employed over 25 workers to restructure, under threat of non-renewal of business licences. After several amendments, the cut-off was raised to RM250,000 in 1978. 

To overcome these restrictions, Chinese business people resorted to breaking up their firms into smaller units, resorting to Ali Baba arrangements (this was the origin of that term) or moving their businesses outside the country, if neither could resolve their predicament. The net effect: an outflow of capital from the country during the 1970s and slowing growth – which did not help employment.

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Unsurprisingly, the electoral performance of Umno was on the rise; not least, it performed spectacularly in Kelantan. 

However, the performance of the non-Malay BN parties was largely dismal. This pattern persisted throughout most of the 1980s, even after Mahathir took over Umno and helmed the BN beginning from 1981. 

During that first decade of his rule, Mahathir ruled with an iron hand. He was tough on the students, the dakwah movement, the new phenomenon of NGOs, the judiciary, the opposition, and his opponents within Umno itself. This first decade climaxed with Operation Lalang in 1987, his assault on the judiciary in 1988 and his battle with Tengku Razaleigh Hamzah and Musa Hitam. 

Mahathir then relaxed his grip and won over his critics, even opponents, as he promoted rapid growth and industrialisation in Malaysia. Fortuitously for him, Malaysia discovered offshore oil: petroleum exports rose from RM203m in 1970 to RM6.7bn in 1980 to RM9.7bn in 1985. Unprecedented levels of foreign direct investments flowed into Malaysia, following the Plaza Accord in 1985.

The original Vision 2020

Back on 28 February 1991, about 30 years ago, at the inaugural meeting of the Malaysian Business Council, Mahathir first declared our aim should be “a Malaysia that is a fully developed country by the year 2020”.  That’s today! 

To achieve this, “nine central strategic challenges” were identified:

  1. A united Malaysian nation which is territorially and ethnically integrated and made up of one “Bangsa Malaysia” with political loyalty and dedication to the nation
  2. A psychologically liberated, secure, and developed Malaysian society with faith and confidence in itself. This Malaysian society must be distinguished by the pursuit of excellence
  3. A mature democratic society, practising a form of mature consensual, community-oriented Malaysian democracy that can be a model for many developing countries
  4. A fully moral and ethical society, whose citizens are strong in religious and spiritual values and imbued with the highest ethical standards
  5. A mature liberal and tolerant society in which Malaysians of all colours and creeds are free to practise and profess their customs, cultures and religious beliefs and yet feel they belong to one nation
  6. A scientific and progressive society that is innovative and forward-looking, including contributing to the scientific and technological civilisation of the future
  7. A fully caring society with a caring culture, a social system in which society will come before self, revolving around a strong and resilient family system
  8. An economically just society where there is fair and equitable distribution of the wealth of the nation and where there is no identification of race with economic function and the identification of economic backwardness with race
  9. A prosperous society with an economy that is fully competitive, dynamic, robust and resilient

Vision 2020 version 2.0 

  1. A united Malaysian nation… made up of one Bangsa Malaysia? In fact, we now have a PM who believes that he is first and foremost a Malay. Umno and Pas are keen to rally Malays and Muslims together under Muafakat Nasional, minus the non-Muslims, definitely minus the DAP, the preferred party of the non-Malays in many parts of the country. Worse, many of these would-be political leaders are still exploiting ethno-religious sentiments for their own political expediency
  2. Do you think the rakyat feel liberated and secure, and have faith and confidence in themselves? And that “Malaysian society… is distinguished by the pursuit of excellence”? There is a false sense of confidence among the leaders. Many ministers think rather highly of themselves. In fact, they cannot and do not perform satisfactorily, not even in the areas they have been assigned to, for instance, health, education or economic matters!  Certainly, the pursuit of excellence, understood in the universal sense, is absent. Many do not recognise excellence at all!
  3. We do not practise any form of “mature consensual, community-oriented Malaysian democracy”; ours is a sham democracy. Like we said, the current PN government came in through the back door. It refuses to call Parliament because it fears a vote of no confidence. It is also fearful that its Budget for 2021 might not be accepted because it might not command a majority in Parliament. This is the principal reason it sought a declaration of emergency
  4. There is no doubt we have failed to become a “fully moral and ethical society”. The 1MDB scandal epitomises widespread corruption in high places. We have been well known as a kleptocracy throughout the world in recent few years
  5. We were supposed to become a “mature liberal and tolerant society”. Instead, instances of prejudice and close-mindedness have increased. Muslims are discouraged from greeting fellow Malaysians Happy Deepavali or Merry Christmas. Interfaith dialogues are not encouraged. And Malaysians of all faiths and ethnic backgrounds continue to discriminate against women, misunderstand and patronise the indigenous peoples, not to mention foreign workers and refugees in our midst
  6. Alas, our march towards a “scientific and progressive society” has been put on hold. Statistical data to evaluate the quality of education in Malaysia, particularly in reading, maths and scientific literacy on a comparative basis, show that Malaysian students lag behind the Organisation for Economic Co-operation and Development (OECD) average, and especially their East Asian neighbours. We desperately need to upgrade the quality of our education system if we want to get out of the “middle-income trap” and rise to become a developed nation
  7. Are we “a fully caring society” where “society comes before self” … “revolving around a strong and resilient family system”? It is plausible that most ordinary Malaysians are still imbued with and motivated by a concern for others. But our political elites who have been “gila kuasa dan gila wang” (crazy for power and money) and ever ready to “batu api perkauman” (stir ethnic sentiments) have not been role models. We have religious elites who have compassion for all regardless of faith backgrounds, but we also have religious leaders who are narrow-minded and prejudiced.
  8. Have we become a more “economically just society where there is fair and equitable distribution of the wealth of the nation and where there is no identification of race with economic function and the identification of economic backwardness with race”? No doubt, we have. However, new divides have emerged, within each ethnic community and within the different regions of the country. We also see a “new poor”, comprised of foreign workers who perform the “dirty, dangerous and difficult” jobs in our country. Kudos to Pakatan Harapan, whose 2018 general election manifesto calls for a new national economic policy that helps the poor of all races
  9. No doubt, Malaysia has progressed and prospered considerably since Wawasan 2020 was enunciated in 1991. However, the current pandemic has revealed we are not particularly “dynamic”, “robust” or “resilient”. Worse, the economic slowdown has exposed our chronic debt situation. This is one reason so many groups, not just the opposition parties and human rights NGOs, were against the declaration of an emergency. The Kuala Lumpur stock market would have tumbled, and it would have sent the wrong signals to foreign investors and borrowers
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The three biggest government-linked investment companies – Khazanah, PNB and the EPF – are plagued with massive debts or investment losses. Khazanah Holdings –  which also has major stakes in Tenaga Nasional, Telekom Malaysia, property group UEM-Sunrise and telecoms firm Axiata Group – is unable to inject fresh funds into Malaysian Airlines Bhd, which is part of its stable of listed companies. So, there is fear the airlines might go under.   

Nor is Petronas able to bail out these government-linked companies and government-linked investment companies this time. Petronas is itself bleeding – what with the collapse of the oil and gas industries globally. 

Yes, 2020 will go down as an ignominious year, partly because of the near collapse of our economy. But the real reason 2020 will be remembered vividly and with embarrassment is that it turned out to be the opposite of what Wawasan 2020 had been set out to emblematise.

Time for all Malaysians to take over

We have greater political instability, further ethno-religious polarisation, widespread corruption. And we have ended up way off from the original Wawasan 2020 targets of a fully developed country, a mature democracy and a caring society. 

Most of our political and social institutions have been compromised over the past decades. They were no longer functioning with competence, accountability and transparency. This allowed Umno-BN to emerge as perhaps the most important remaining political institution. 

However, especially under Najib’s watch, corruption was rampant. He also concentrated power in the Prime Minister’s Office. So, we do not even have the Umno-BN political machine left to maintain a semblance of the old political stability and distribution of largesse. It does not appear that we will ease out of this period of political intrigue and instability, backstabbing and leapfrogging, an attempted emergency and widespread corruption soon. 

I have suggested that we might have entered into a period of transition that could last about a decade, like that period of much instability and uncertainty of the 1970s, following the May 13 racial riots in 1969. 

New Politics 2.0 is not one where another multi-ethnic opposition coalition has displaced the Umno-BN and we begin to implement the reforms we had identified in the Buku Jingga manifesto. 

The elephant of Old Politics is still in the room, and it refuses to go away. So, the old politics of manipulating ethno-religious sentiments, money politics and patronage persists, amid still-born attempts to push for targets identified in the original Wawasan 2020. 

It is time for all Malaysians, especially the young of all ethnic groups and religions, who are drawn to the targets of Wawasan 2020 and want to develop those targets further – for instance, by adding something on sustainable development and ecological protection – to take over. People stuck in Old Politics, step aside immediately. 

Francis Loh
Co-editor, Aliran newsletter
30 October 2020
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loyal malaysian
loyal malaysian
3 Nov 2020 6.11am

Tq, Francis for such a detailed write-up but I have to say it make for a sad reading – the whole litany of failings of our political leadership since Vision 2020 was formulated.
But I feel your prophesy of a decade long transition may not be a bad thing for the nation if it means power that means to be in favor of TUMPAS will not be total as was the case during that evil man’s 1st decade in the 1980s.
Yes, our nation’s political room needs new players – all those old horses stuck in Old Politics should be sent to pasture.
Yes, this is the time for “young of all ethnic groups and religions” to come to the fore , to lead our nation in a new direction.
Singapore is into its 4th generation of leaders after LKY, we still have that dictator!!!