The poor are not envious of the rich; they just want a decent life

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Photograph: Choo Choy May/Malay Mail

Why did the PM target the poor person, working day in and day out, trying to make ends meet, wonders S Arutchelvan.

Dr Mahathir Mohamad’s condemnation of the poor at the monthly address at the Prime Minister’s Department during the morning assembly on 6 January 2020 lacks humaneness and is humiliating to the millions of workers and people who work hard, day in, day out, just to survive.

Only someone with a Trump mentality could appreciate such a speech that degrades and undermines people.

Mahathir was quoted as saying, “Why are they poor? Because they are unproductive and do not contribute to society in a way where society would repay them.” He also said the poor should not feel envious of the wealthy because the wealthy pay high taxes, and the government uses this money to pay salaries and develop the country.

Who is Mahathir calling unproductive and not contributing to the society?

Is he talking about the fisher folk who go fishing before daybreak and risk their lives at sea?

Or is he talking about the farmers in his home state of Kedah toiling in the paddy fields to grow rice for the nation?

Is he talking about the factory workers who are forced to work 12 hours to complement the totally inadequate minimum wage?

Is he talking about the small farmers who work the land to ensure we get our supply of food?

Or the nanny who takes care of our children in the absence of nurseries at the workplace?

Or is he talking about the plantation workers or the cleaners or the thousands of people who cross the border in the wee hours to do dirty, dangerous and demeaning jobs in Singapore?

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Or the lorry drivers who park their vehicles on the roadside to catch up on sleep?

Or is he talking about the civil servants whose pensions he plans to slash?

Or is he talking about the miserably paid motorbike riders delivering food or the ride-hailing drivers?

Who is Mahathir calling unproductive, not contributing to the development of the country and envious of the rich?

Productivity low?

According to International Trade and Industry Minister Darell Leiking, Malaysia’s labour productivity actually grew 2.2% in 2018, surpassing some developed nations including China and Australia and was ahead of selected Asian countries. Even Japan, which Mahathir always looks up to, had lower labour productivity.

Now, let’s look at another study “Are Malaysian workers paid fairly?: An assessment of productivity and equity” by Athreya Murugasu, Mohamad Ishaq Hakim and Yeam Shin Yau. Their study concludes that Malaysian workers receive lower compensations relative to their contribution to national income from productivity and equity perspectives. They argue that Malaysians are paid a lower wage compared to benchmark countries, even after taking into account productivity differences. They also conclude Malaysia has a lower labour share of income despite (the economy’s) labour-intensive nature. This suggests workers are not adequately compensated for their contributions.

Their study raises some serious issues which Mahathir and the rich don’t want us to know. While employers (bosses) need to be fairly compensated for their respective factor inputs, the question remains: why is the share of compensation to employers (bosses) higher relatively to workers and why isn’t this reflected in Malaysia’s taxation and distributive policies?

Do the wealthy pay high taxes?

Now let’s talk about taxes. Mahathir glorifies the rich for paying taxes. Perhaps he did not hear what Lim Guan Eng said. In one of his post-budget forums, Guan Eng said that even by increasing taxes to 30%, we would still be among the lowest compared with neighbouring countries. He added the government does not believe in harsh and abrupt measures in taxation.

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Perhaps harsh and abrupt measures are reserved for workers only – by keeping minimum wages low.

Guan Eng also said that there would be no new taxes on the wealthy to prevent shocks to the financial system. He said the government would not introduce capital gains tax on shares and other taxes on the wealthy to prevent a “shock to the system”. These measures are to ensure there is no capital flight, according to him.

So Mahathir’s wealthy will take a flight when taxes are increased. So much for Mahathir’s appreciation of the wealthy and their taxes: the minute taxes go up, they will abandon him, unlike the poor whom he enjoys attacking.

Anyway, how much do the rich get taxed in Malaysia? Can Mahathir give a figure how much tax the richest 10 people are paying in Malaysia? While their income has been made public, their tax payment details come under the Official Secrets Act. according to answers given in Parliament. And who can forget the government giving Lynas 12 years of tax exemption despite all the controversy over its handling of radioactive waste.

The poor and the remaining 80%

Looking at purchasing power, Malaysia’s wages are one of the lowest in the region. Most of Malaysia’s poor earn monthly salaries that are two times lower than the monthly entertainment allowance of RM2,500 paid to MPs. Our MPs even get a fuel subsidy of RM1,500 a month – which is higher than the minimum wage set by the government.

According to an article by Deputy Defence Minister Liew Chin Tong, in an article published in Malaysiakini on 31 Decmeber 2019, nearly 30% of Malaysians polled by Gallup in 2018 felt that they did not have enough money for food; 23% reported not having enough money for shelter; 80% of them experience economic insecurity, such as low wages and the high cost of housing and transport.

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What is shocking about his revelation was that he said: “The B20 poverty category [the bottom 20%], as defined by the UN, needs welfare, but in the Malaysian context, it appears that the subsequent 60% (M60) need better jobs, better pay, better business opportunities, better upward mobility for their children, better housing options and better transport alternatives.”

The United Nations special rapporteur on extreme poverty and human rights Prof Philip Alston’s report suggested that Malaysia’s poverty rate is most likely between 16% and 20%. Chin Tong, while agreeing to this, also said that beyond the bottom 20%, the rest of the population (perhaps excluding the top 20%) ie the middle 60% are in the same boat.

What was laughable was when Mahathir said, “I hope everyone will focus on the nation instead of themselves.”

Why then did Mahathir focus his attack on the poor and not question the huge allowances paid to his cabinet? Or address the stashing away of wealth in tax havens by corporate figures or the huge salaries drawn by the CEOs of government-linked companies?  

S Arutchelvan is the deputy chairperson of the Socialist Party of Malaysia (PSM)

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Kam Hong Yeap
Kam Hong Yeap
13 Jan 2020 12.05am

As a leader whose salary is paid by the Rakyat , he is responsible to uplift the quality of life of the rakyat esp. the poor, needy and ignorant. Definitely not to bash, belittle or manipulate them to enrich himself.
No wonder the poor sees not much improvement in the lives for the past 40 years esp. their REAL INCOME after adjusting for inflation.

Santana Kl
Santana Kl
8 Jan 2020 3.21pm

Since merdeka till now not a single PM can be considered sympathetic to the workers course. Since the NEP things got worst because of govt involvement in business. All the large estates are currently under the control of GLC’s. In such a situation how can the govt allow wages to rise. This would mean less profits for the companies. So it’s obvious this conflict of interest keeps wages low in our country.

Gursharan Singh
Gursharan Singh
8 Jan 2020 12.01pm

YAB PM to note:
# The salaried people pay COMPARATIVELY HIGHER INCOME TAX than the rich who may include political/corporate/civil service leaders who get their remuneration in three forms i.e. SALARY-ALLOWANCES-PERKS and ESOS. Also small investors are subjected to 25% tax rate. # Some POLITICAL LEADERS may be ENTITLED TO MULTIPLE PENSIONS [one being tax exempt] for having held POSITIONS FOR SHORT PERIODS.
TAX LAWS MAY BE PERCEIVED TO HAVE BEEN DESIGNED BY RICH PROFESSIONALS TO BENEFIT THE RICH AND THOSE IN POSITIONS OF POWER.
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