No more ‘stranger’ economy, please

Praba Ganesan is a Hulu Langat boy with a penchant for durians and debate. He is part of balairakyat, an NGO promoting ideas exchange. More of him at prabaganesan. wordpress.com

The country needs a change in economic philosophy, not more economic Powerpoint slides.

It is almost like the managers — the policymakers and implementers — are school teachers ignoring most of the “classroom” or population and hoping their star students will shine enough with As to drag everyone else kicking and screaming to a high-income nation.

That is not the world we live in today, nor the reality we should aspire for us Malaysians.

This exclusionist economic philosophy is why every plan on the plate today will fail: the Economic Transformation Programme (ETP), New Economic Model (NEM), 10th Malaysia Plan (10MP), etc.

Fail meaning the end result, the return to investment will be disappointing. Malaysia powered by petro dollars and other friends (timber, rubber, palm oil, etc) has become a modestly populated nation with sub-par stuff, and all with qualifiers.

Our public universities are newer, bigger and constantly renovated. Their common lavatories without exception smell and usually break down compared to, say, Thai universities.

We always spend more money and get less out of the process.

Yes we have an LRT in the Klang Valley, but how nasty is it considering the money we pumped into it, and why has it been nationalised that many times and still not satisfying?

Why in the devil did the Petronas board allow for the construction of the KLCC twin towers, while Dayabumi lies around KL as a joke?

Like any foolish shopper we have bags and bags of stuff after decades of purchases. But open the boxes and see what we’ve got. Then ask how much was paid.

A slightly burnt burger with chips from a fast-food joint is a meal, all things considered. But not when you paid the price of a steak.

When we think of the spending you have to add up both the annual budgetary expenditure and what the GLCs spend — since they belong to Malaysians.

The powerful over-emphasise the “benefits”, while completely underplaying the ridiculous prices paid — that is our malaise.

Singapore stares right at us. I do my share of poking fun at our stiff southern rebel state residents, but we cannot perpetually use demographics to sideline their achievements.

They have for decades made sure they get more for their dollar, and the results add up. The fact that ex-Malaysians have done a fair bit of the planning and execution must hurt a tiny bit, more so for our Cabinet.

Let’s turn the corner.

Key goals have to be expanding resource capacity, jobs and high-value public goods.

The economic philosophy has to be akin to a Beatles song, “We can work it out.” The main stress is the “we.” All of us are that “we.”

Every policymaker uses the sound bites: “knowledge economy”, “value proposition”, “information age”, “globalised markets”, “service oriented”, “customer focused”, etc.

But the economy is a daily reality for all of us, so why can’t leaders explain them in plain terms to the rest of us without the abbreviations? Surely the plans can only be successful if most of us understand them.

You have to win people over, and you have to trust them with the work. Thus “We can work it out.” not “We, the blue-bloods will consider, strategise and produce Powerpoint slides, and you, the rest, can thank us by bloody getting on with it.”

The command economy, harking back to the days of multiple councils operating around Mageran (Majlis Gerakan Negara), was real swell in the ‘70s, but these days Malaysians have email.

Where was the consultation with us before all the failed programmes of the last decade were introduced?

We need to shed parochialism. But neither do we need to divorce from our eastern norms. Father does not necessarily know best, but father does know many things. However today, the whole family needs to get their hands dirty.

And no, I am not talking about all Malaysians logged on to a massive chat-room and the PM facilitating the discourse.

But the means are there. And buy-ins occur over time, and more importantly result in improving the idea. If you want a hint, get small business owners to have more input. When you deal in businesses that are not protected by “sponsors” — you and your business tend to be more dollar-savvy, grounded and flexible.

Australia has a high ratio of small businesses, but they also are highly productive, as the dollar productivity of each employee is higher than the national average.

That is part one, continuously seeking the buy-ins of your taxpayers.

The second is empowering people in the economy.

Government services and GLCs can lead the charge by allowing all employees to become active actors. Not all ideas have to come from the Cabinet and boardrooms. Top-down processes are genuinely choking the life-force of millions of Malaysians.

People don’t oppose what the PM or CEO says, but can be indifferent and they often do. Their limpness will lead often times to good ideas being ineffective.

The top tier must remain in maintaining co-ordination and broad ideas, but they must let the lower tiers tailor the ideas to success. They must be able to spend and have autonomy, without feeling they are only serfs.

It cannot be, everything changes every time a new minister or CEO is appointed. It is crazy the way we do U-turns without blinking.

But the flipside to giving power to people is to defend accountability and the price which comes with it. Failed units must go, and poor decisions have to face consequences.

In football, we call it “give and go.” Because you are one of 11 players working to scoring goals you pass on the ball to the next player while you move to a better place on the pitch. Everyone is in constant movement, and you trust your teammates. That everyone is aware you are making decisions which 10 other players gain or lose from.

Everyone has the right to make decisions, to act. Some are better, but teams that only involve some of their players and not all lose more than they win.

October is Budget month, the prime minister might want to think how he can “give and go” with more of his countrymen rather than hog the ball for his boys only.

Finally, how we spend, which is where we started this column.

There is the classic clash.

That the poor should not decide how we spend since they have never seen that much money in their lives, and would be simply overwhelmed. But I’ll be quite happy to point out the other side to the coin, that the rich spend money with abandon and are naturally naïve.

There’s truth both ways, and since most Malaysians are neither in poverty nor in the VIP room at the Zouk, the answer is somewhere in between.

But all spending requires examination.

The fact catering is a major business in Malaysia must be telling. A lot of taxpayers’ and GLC money goes there. And let me not start on the mark-ups, and the bureaucratic fire-hoops which inevitably lead to leakages.

We’ve been spoilt by our wealth. Upside, we never lived in economic fear. The spiralling downside, we are not penny wise.

At some point, the tap will run dry. We cannot continue to spend on non-regenerating ventures.

We need to get more from every ringgit. Especially in public goods.

Investments must meet needs, not creating needs to meet investments.

Cyberjaya and Putrajaya have been failures when you think of the return on investment, but that is the big picture.

Only the administrators of a general hospital know the relative needs of the facility — an additional dialysis machine for patients with failed kidneys, or more nurses. The quality of the decision improves markedly when they get to decide the type of dialysis machine versus the nurses’ shortlist.

Money is always better spent by those likely to pay for poor decisions. Getting a contractor to purchase all the groceries of a street with 10 homes will make it cheaper with economies of scale, in theory. But not all the homes need or want peanut butter.

That’s my triangle of growth for Malaysia: policies means-tested with the population, the empowering of the workforce and diligent spending.

We have every chance then to make more Malaysians not strangers to their own economy, and every chance to become a strong economy. And I’ll even put up with the Powerpoint slides in that reality.