RENT-SEEKING has been
turned into an inimitable art by some individuals. From small cleaning
contracts to million-ringgit security deals, rent-seekers have firmly
established themselves as players with no one having the guts to
challenge their so-called status. If public-listed companies and
multi-national corporations accept and respect their existence, who are
we, the Ordinary Joes, to question or even stand up to their domination?
Ask the beer and tobacco industries,
which incidentally collectively pay about RM5 billion in taxes and
excise duties. The rent-seekers knocked on their doors and got away and
still are getting away, no thanks to godfathers. For every packet of
cigarette or bottle of beer sold, the respective industries are paying a
few sen each for security markings – which runs into millions annually –
purportedly to prevent illicit, counterfeit and duty-free products from
reaching the market. Their protests over such rent-seeking exercises
fell on deaf ears. Even a high-powered delegation of the industries’
umbrella bodies was treated with contempt with no room for discussion.
Despite these security markings, the
figures on smuggled cigarettes and beer have been on an upward trend.
Then there are the smaller ones who
collect little, 3-4%, of the total value of equipment supplied to the
government.
No one objects or disapproves of any
effort to correct the imbalance and the affirmative policies to help
certain classes of people. But when they want to shake legs and become
millionaires, there’s bound to be concern and discomfort in the way
business is done. Privately, investors have expressed their views on
rent-seekers and the approaches to make "easy money" to the authorities.
Talk to anyone in the business community who has dealings with the
government and he or she will have plenty to say about "budgeting" for
rent-seekers, agents and Mr Fixits. They can tell explicit tales of how
their product which was sold at X price was finally sold to the
government at X+10. They will also tell you of arranging junkets
disguised as familiarisation tours to their overseas headquarters for
rent-seekers and agents. Even a proposal to ban "surat sokong" from
elected representatives has brought about strong objections – an
indication of the requisites to doing business in this country and the
power of the rent-seekers.
Therefore, the prime minister’s
announcement yesterday that rent-seeking will be an activity of the
past, must be welcomed by all and sundry who want a level playing field.
In launching the New Economic Model (NEM), he said: "Affirmative action
programmes and institutions will continue (in the NEM) but, in line
with views of the main stakeholders, will be revamped to remove the
rent-seeking and market-distorting features which have blemished the
effectiveness of the programme."
While no one has exact figures on how
much leakage there is in government spending, The Edge quoted an
economist with Morgan Stanley as saying in 2004, that over the past two
decades, Malaysia had lost some RM330 billion in the form of corruption.
Khairy Jamaluddin, when vying for the Umno Youth leadership last year,
was reported to have said that 10% of government spending was wasted
through leakage. However, the weekly said that private sector chief
executives will claim that government spending, especially on
construction projects and procurement can be inflated by as much as 50%.
But more telling is the prime
minister’s announcement of the setting up of an "Equal Opportunities
Commission" to ensure fairness and address undue discrimination when
"occasional abuses by dominant groups are encountered". We will soon
learn of the composition of the commission and its terms of reference.
While most right-thinking Malaysians
must congratulate the prime minister for his forward-thinking and
rational policies for the betterment of the country and its citizens,
there’s some worry too. Will those who have benefited from the system be
able to let go of something that they had been enjoying all these
years? Can they give up their chauffeur-driven cars and the golf club
memberships? Will their mindsets change and will they accept the fact
that they will have to work for their money?
The prime minister noted that excessive
focus on ethnicity based distribution of resources has contributed to
growing separateness and dissension. He needs our support to bring about
changes to a system which has evolved along patronism. His new
affirmative policies bode well for all Malaysians. Hopefully, with the
implementation of the NEM in totality, it will bring about a new dawn
for this blessed country.
R. Nadeswaran has had his fair
share of run-ins with rent-seekers and wannabes who think it is their
birth right to impose a surcharge on anything that is paid for by the
government. He can be reached at: citizen-nades@thesundaily.com
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