December 11, 2020
thoughts on
National Reset

Envisioning a Better Malaysia

December 11, 2020
Organized by:
Department of Economics, IIUM
Featured on:
IIUM Roundtable
featured on
IIUM Roundtable
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Major concerns about our country and how to move forward.

Thank you for inviting me to elaborate on the recent speech I gave at the Chevening Alumni Leadership Talk on 16th November. Alhamdulillah, the speech seemed ‘well-viralled’ and was well received. The Malay version was published in Sinar and Astro Awani, and again the feedback was largely positive. Perhaps Malaysians are in search of a better way forwards.

The main suggestion I made in that speech – another NCC, like we had in 1970 – was not new. I first did so in my keynote at KMF in October 2015; soon after PM Najib had sacked the AG and DPM, co-opted most of the PAC members into cabinet and effectively stalled all investigations on 1MDB. It re-affirmed that power had become dangerously too centralized; so much so that the system could not even deal with an international financial scandal of gargantuan scale. 

In that speech I shared some of my own anecdotes from the past of how concentration of power in previous PM’s had also resulted in poor decision-making and dysfunctional business culture. Business was first about access and willingness to make political contributions, not about ideas and value creation. 

In Sept 2016, I organized a prototype NCC, gathering about 25 Malaysian at Oxford - Tun Musa, Idris Jala, Jomo Sundram, Anis Yusal, Marina Mahathir, Jemilah Mahmood, Cynthia Gabriel, Tong Kooi Ong, Tony Fernandes, Yong Poh Kong, Wan Saiful, Maszlee Malik, Marzuki Mahmud were among the attendees - to discuss what ails Malaysia and what can be done about it. We came with different allegiances, but I thought the whole ambience of an offsite and total focus on what each of us thought was the best for Malaysia without having to defer to political parties or leaders, was very powerful. I quip that our experience was very similar to what one reads in literature on deliberative platforms such as James Fishkin’s America in One Room, the Irish Citizen’s assembly and Belgium’s Ostbelgian model. These models advocate for the establishment of deliberative platforms of citizens, community leaders and intellectuals instead of politicians to debate certain issues that are less suited to parliament of elected representatives, governed by political parties. Ironically, Malaysia had such a platform just after the May 13th breakdown in civil order, the NCC.

The Oxford group agreed on many things and reform ideas, but not everything. The debate on education for instance, needed a few more rounds to resolve tensions around vernacular schools and national integration. But there was certainly conviction behind the need for the establishment of another NCC. When we came back to Malaysia, we talked to others and many political leaders including DAP, Gerakan, MCA openly welcomed the idea. All of a sudden, there was a prime-time TV3 news appearance by a known PMO “attack dog” attacking me and Wong Chun Wai of the Star, another Oxford collaborator. The signal was clear – NCC2 was not welcomed by PMO. Other things then went on in the background which I don’t need to get into, suffice to say that politically I went onto the sidelines.

I was pleasantly surprised by GE14. Like many I was optimistic that we would finally be on the path to reforms given the contents of the PH manifesto. My background in political science reminded me though that as great a triumph for democracy that GE14 was, there was no guarantee that a more stable democracy would emerge. Arend Liphart, who of course coined the term consociational democracy to describe the ethnic-based coalitions that emerge in plural societies, would predict that 2 race-based coalition systems is unlikely to work. Political outbidding around racial lines was the more likely outcome, and so it proved as. We saw PH replaced by Malay dominated PN, which is equally unstable and we should all be very concerned that unstable politics where there is only a political economy is dangerous. Some consequences that we are seeing:

  1. FDI and DDI deterred
  2. GLC‘s politicized 
  3. Licensing, permits politicized 
  4. Entrepreneurship suppressed by vested interests 

What is the core of the problem? It is systemic and reform cannot be piecemeal.
  1. Malaysia has been plagued by a three headed monster; identity politics, money politics and concentration of power. 
  2. Our race based political and FPTP electoral system sets the incentive structure for politicians. And ensures that reforms largely get stuck at the rhetoric. We saw Najib backing off from the implementation of his much touted NEM which was set to introduce a needs-based affirmative action to replace NEP, PH’s Bersatu unable support even basic reforms like UEC and ICERD. 
  3. Democracy needs money to mobilize but money has to be governed. When unrestrained like ours then money will rule everything from policies, to contracts to positions. I have seen it all from the inside out, it is ugly. 1MDB was just the most extreme manifestation of it but our first major financial scandal -BMF affair- was also driven by political motives. In my young days I took many companies public and saw how the allocation of shares to bumiputra became about politics not capacity building. And in the 1990’s I saw the building of bumiputra tycoons in the name of the NEP end with calamitous consequences with the AFC.
  4. The excessive centralisation of power has amplified the systemic dysfunctions in our governance because of the lack of accountability and checks and balances on those in power.  As I said earlier, 1MDB was the extreme demonstration of the power of the PM’s office, but since the mid 1980’s the power in the PM’s office was way beyond what was imagined in not only our original constitution but also in the 1970’s redesign by NCC. We have gone way off the charted course.
  5. I compare Malaysia’s system with a badly written play. No matter how good the actors we chose, the play will still be bad. We need to change the script. 

Can there be a Better Malaysia?
  1. We have to acknowledge that the system is no longer fit for purpose and that Malaysia is in dire need of another system reset.
  2. In partnership with some academics and civil society, I am pursuing the idea of a system reset. We have embarked on a 6-month study, beginning last September, to gather the view of Malaysians across the various spectrums of society and are also soliciting ideas from the wider public at The idea is to describe what a better Malaysia could look like, ultimately to convince people that it is worth embarking on a system reset, with an NCC like process to recalibrate. 
  3. Areas of improvement I would like explored 1) new institutional rearrangements to have an effective referee to political competition, 2) clear separation of business, government and politics, 3) electoral reforms 4) new social contracts between communities and also between the government and the governed 5) clarity in the role of Islam and the state.

In conclusion, I do think that there can be a Better Malaysia, it is worth striving for and it has to start with a platform for constructive deliberation by a representative group of Malaysians.