Creating a broader vision

MAY 9 marked a watershed moment in Malaysia's history. At this juncture, a 20-year struggle had succeeded in gaining power; and the spine of a 61-year-old status quo was broken.

A new equilibrium was reached. The markets welcomed the change. The KLCI initially gained 3.91 points to close at 1,850 and the ringgit recovered to 3.95 against the US dollar. More recently, concerns over the magnitude of debt have depressed the KLCI.

The people are warm with euphoria and heightened expectations.

What has to be done now?

First, Tun Dr Mahathir Mohamad has to gain the confidence of the people, to assure them that he has assembled a cohesive coalition, not a motley bunch of warring factions.

Second, Mahathir has to convince the public and the markets that he has a clear economic and social roadmap. He is expected to articulate a plan of action on the economic and social direction of the country.

As a corollary, one could also look forward to a freshly thought-out foreign policy and geo-economic strategy.

Third, it is imperative for him to revise the institutional foundations of the country. This involves a long and complex web of processes and organisations.

By institutions, I mean organisations, processes and values. The reformation of institutions is an onerous task because it involves the judiciary, civil service, and government agencies. It also includes customs procedures, government procurement, as well as the selection and award of projects.

More foundational to institutions are the values, habits and beliefs that are held. This is certainly the deepest part of institutions and, certainly, the most difficult to correct.

Let us take the notion of the rule of law as an example. Not only should legal processes be respected, but individuals should adhere to the principles of judicial independence and neutrality before the law. Aside from all the structures that support the execution of the idea of the rule of law, people should subscribe to ways of thinking that accept such statements as, "I will apply the law to my foes and, equally, to my friends, if there is adequate ground to believe that there is wrongdoing."

To take another example, when funds running into billions are transferred from and into domestic accounts, do bells not ring within the banking system? Is there no mechanism to control the flow of illicit funds? If there was a mechanism and it did not work, why did it not? Was it because of political interference? Was it because it has become the norm to ignore certain signals?

These three factors effectively imply a reformation of the Malaysian fabric.
Setting the roadmap for economic transformation is the easiest of the three tasks in so far as it deals with tangible parameters. Even here the ease of accomplishing the desired objectives will not be without its challenges.

There is a whole host of phenomena that have to be examined: public debt, household debt, debt servicing, cost of living, youth unemployment (graduate unemployment, too), fiscal prudence (Malaysia has been running on a budget deficit in most years), contingent liabilities, the exchange rate and subsidies.

If the economic-to-do list is a tough one, the social list is even more challenging.

Some of the questions that will come up will resemble the following. Will we be moving towards a post-racial society? Will there be a switch to a Malaysian identity, one that goes beyond ethnic considerations? Will all ethnic groups within the B40 be treated equally, or will the more disadvantaged among them be prioritised?

The G25 has articulated a more liberal and secular vision for the nation. They closely hold on to the spirit of the constitution. Will their vision be appealing to the present government?

For the moment, Mahathir is doing well in holding his team together, keeping their noses to the immediate problems at hand. His submission of Tommy Thomas's name for the post of attorney-general hints at a post-racial society in the making. At some point ideological differences may come up. Hopefully, by that time there is greater maturity and a more encompassing vision evolves.

One expects that in time more robust institutions will develop, supported by more enlightened values that are embedded in society, so that differences are accepted without leading to the fragmentation of society.

Dr Shankaran Nambiar is a senior research fellow at the Malaysian Institute of Economic Research. He is author of "The Malaysian Economy: Rethinking Policies and Purposes" and "Malaysia in Troubled Times". Comments: