great mind of a man

Politicians thrive on chaos. I could not help having that kind of feeling. I was watching Anwar Ibrahim giving his speech titled “Global Economic Crisis and The Future of ASEAN” at the Chulalongkorn University in Bangkok.

The talk was organised by the Political Science Department of the University. This talk was a maiden speech as far a foreign speaker was concerned. The department decided to invite Anwar Ibrahim as a foreign debut.

I had never seen him speaking before an audience before. Nor had I had a chance of meeting this respected figure before. His reputation definitely preceded him. I sent an e-mail afterwards to YM RPK, a friend I knew way back when I was struggling as an entrepreneur, saying that I could not help but being impressed.

His delivery may lack a bit of punch because the way he chose to deliver it, i.e. by referring to his written text, but his bid to elaborate the points was very good. I thought that he might have had a brilliant think-thank working on his speech or perhaps the man himself was a man of substance. Judging by massive followers that he has in Malaysia and the region, the latter could be the case.

Immediately the day after the event I read the full text again on the internet right down to each finer point. The speech merits further deliberation indeed. For those who wish to get yourselves enlightened on current turmoil, do visit this site: http://anwaribrahimblog.com/2009/03/31/the-global-economic-crisis-and-the-future-of-asean/#more-6547.

In Pursuit of the American Dreams

I had been trying to explain to my fellow staffs the reason behind current economic crisis and cited greed as key to the whole issue coupled with flawed financial system where usury being the main culprit. I am glad that I did not run far away from what was said by the said speaker. I referred to this excessive greed on the part of the population to pursue material wealth at all costs and casting aside social responsibility. This madness is often referred to as an “American Dream”, a dream to pursue not so much “freedom and independence” as what was then synonymous to but rather a blind pursuit of material wealth. Younger generations often associated freedom and independence to ability to amass, accumulate and indulge in immense wealth and engage in activities without any limit, be it social, religious or cultural.

The world economy is bloated with goods and services that have superficial value. This superficial value stems from creative manipulation of human behaviours. People are being bombarded with (dis)information that conditioned their mind to believe and accept that some useless products or services possess extremely great values. These superficial values attached to these products and services are very much apparent if one studies value engineering where “aesthetic” value aspects are given greater emphasis as opposed to “primary” value. Primary value (or often referred to as “function”) is the key value. Aesthetic or other attached values are values that make one wants to own a particular product or wanting a certain kind of services.

In a world where brand building has reached a stage where it makes products or services command values far surpassing their actual value, we will be procuring pathetic values at exorbitant prices. Profit then flows into the hands of minority few that get richer at the expense of uninformed consumer. Again greed is central to the whole issue. We formed this popular opinion that happiness equates material wealth.

Next in our pursuit to satisfy our greed, we borrow when we have insufficient fund to finance it. We indulge in excesses thinking that we are embracing fully this capitalistic behaviour.

The key thing is how long can this practice continue. Definitely not very long at all! This madness comes to an end with the credit crunch. Now we have to scramble to stay afloat, to pay our credit cards and mortgages. On the behest of this new revelation, we are now awake and become a bit sober. There is this social responsibility part that we have forgotten in our lunacy to pursue material wealth.

Looking at a macro level reveals another flaw. Economy is always spoken about without fail with reference to government spending. Economy will grow when government spend. Governance and transparency on the part of government in its spending is of paramount importance. Government’s irresponsibility in dishing out “contracts” to cronies at costs far higher than actual costs is causing a leakage in the economy. We are again paying higher price for a meagre service or product. Similar to commercial goods, this practice lead to excessive profits ending up in coffers of select few.

Economic Connoisseurs

Interesting to note that Mr Anwar brought up that it was the failure on the part of economists to predict the impending crash that made the impact more devastating. Everyone was caught with their pants down. Further, the effect is very far reaching and pundits are still debating as to viable prescriptions to get us out of this doldrums. Whichever way the argument goes, one cannot ignore that government’s role is central to solving this predicament. “Bailouts” did not go down well during the Asian Financial Crisis. Now in Malaysia we are being introduced to “Stimulus Package, perhaps a positive way of looking at bailouts as means of pouring in much needed cash into the economy. However, if economists failed to predict this catastrophe in the first place, they therefore may not be qualified to offer prescriptions. Can one trust their recommendation, advice or suggestion? Doubtful indeed! Already there is accusation that these specialists grossly underestimate intensity of the problem and depth of the “black hole”. How much capital does it take to spur growth? Cash poured in seems to disappear without any noticeable impact to the economy and in Malaysia’s case leakage is the main worry. It is like throwing dust to the wind!

Structural Defects

Whatever measures that we are going to take, we must not run away from first addressing structural defects prevalent in our system. If we do not do this, we can guarantee that whatever we do will not be any good. These defects are mainly poor governance and opaque practice that suck the very life out of the economy. People in the end suffer.

Besides defects in the delivery process there are also defects in the financial system itself. With excessive profiteering and magnanimous payment on loan interests, monies flow only to the haves and the haves-not are reduced to extreme poverty level. No wonder it did not take long for demand of goods and services to dwindle.

Widespread Pessimism

When news of collapse of lending institutions reaches the masses, they can only react by tightening further their spending in anticipation of further disintegration of the already fragile economy. Property price plummets and mortgages defaulted. People only buy basic necessities. There is then widespread belief that things are going from bad to worse and people wait for the illusive bottom of the ravine that is slow in coming to the surface. We refrain from making any unwarranted spending. The economy is reduced to a standstill.

Impact of this psychological behaviour of the masses to the economy is devastating and there is little that one can do. Only time will be able to mend this effect and time is exactly what we do not have since we are suffering a great deal with this economic downturn.

This brings us back to the talk at Chulalongkorn University and the title of this piece by troubadour today.

The chaotic state in which Malaysia is in today seems to provide an excellent platform for astute politicians to justify their existence. Much like murky and troubled waters, there are those that fish rather skilfully in them. Elaborating on questions fielded by Suthichai Yun of the Nation Group, the Larry King of Thailand, Malaysian opposition figure could not be more at ease. Audience had a field day with his answers from crafty one as to when he would become the prime minister to solutions for the upheaval in the South of Thailand. He tackled them rather professionally.

The press conference at the end of the talk was equally exciting. The perceptive leader was a darling to journalists from Thailand and other foreign presses. He listened intently before answering the questions with great perception, intelligence and sense of conviction. As this was my first encounter with him, I chose to observe more than testing his knowledge of regional politics, which is partly the subject he spoke about earlier on.

Mr Anwar was resolute in his pursuit to change the government it seems. He was bent on doing it to bring Malaysia out of its misery. At least that is what he claimed and I kind of believe that he can do it. It was not this encounter that I had that influenced me but rather the sorry state the country is in today that sealed my heart that he is the leader that can do it.

The Governor of Bangkok, Sukhumphan Boripat spoke highly of this particular leader. His descriptive words and the soft manner by which he chose to describe Mr Anwar led us to believe that he was being very sincere and forthright. One could not help but felt very proud that a fellow country man was being accorded such a respect. Our only regret is that the country is about to change from a slight more democratic leader to a tyrant disguised as a potential leader that is a saviour to the nation by the name of Najib Razak. His manipulation of the government, its machineries, civil servants, judiciary, police and the army in the days of the PM’s “sabbatical leave” can only be a reflection of more oppression to come.

Troubadour on the eve of Najib Razak’s ascension to the premiership of Malaysia!

Pattaya, 2nd April 2009