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Sunday, February 26, 2012

Guess what the people are now saying: A vote for BN is a vote for Price Increase

Sulaiman Kamal | 9:45 PM | | | Best Blogger Tips

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The costs of living will be a decisive election matter that will affect UMNO-led government to cling on to power in the 13th general election (GE). The Economist Intelligence Unit's (EIU) ranking of the world's most expensive cities has now placed Kuala Lumpur at the 74th position from 86th last year.

The issue now is that it is more expensive to live not only in Kuala Lumpur but also other cities, towns and even the rural areas of the country. It’s high inflation that cannot be reined by a bungling government which has led to this predicament. While the Consumer Price Index (CPI) – taken to be the official rate of inflation – is in the region of 3 percent plus last year, the masses feel that the figures flaunted by the government do not reflect the real situation on the ground.

“It can never be 3 percent when the price of a kilo of sugar has gone up from RM1.45 to RM2.50. It is a massive increase,” said a school canteen operator in Bandar Melaka.

Robert Kuok could still make good profit

Domestic sugar price went up by 40 percent from Jan 2010 to May 2011 ever since the sugar monopoly was taken over by FELDA from Robert Kuok. Yet at the old price, Robert Kuok could still make good profit. Prices also went up for petrol and diesel and LPG. This has caused a chain effect on other consumer essential products affecting the poor most. A UN survey has projected a significant slide in economic growth for Malaysia this year due to rising food and fuel prices. But the incumbent government lacks the wisdom to manage the staid inflationary problems affecting majority of the population.

Almost all UMNO leaders are rather quiet these days and Najib Abdul Razak – the yet-to-be-officially- enthroned UMNO leader – is fighting all alone in a tough battle to salvage his image as a leader. But his 1Malaysia slogan has met with a lot of opposition from UMNO members including Mahathir Muhammad – a former prime minister. To most UMNO stalwarts the slogan sounds rather vague, ambivalent or ambiguous. The latest desperate move by Najib is to have the slogan 1Malaysia placed on all “subsidised” items to tell the people that UMNO is responsive to the people’s gloom and dissatisfaction. “There will be no subsidy if there is no 1Malaysia logo on the item,” it was once said. This only proves that the government is helping the already-rich business concerns to increase or maintain their huge profit margins but ‘artificially’ reduce the prices of their produce as they have been subsidised by the government using taxpayers’ money.

‘No logo, no subsidy' is absolute superciliousness. Having 1Malaysia logo on subsidised goods is another form of snootiness on UMNO’s part. This is one way though to con the people that the government is seriously helping the people. Then comes the ongoing one-off cash grant of RM500 for low income households to help UMNO win the next general election. However, such schemes are not seen to be sustainable. People are accepting the money in droves but there is no guarantee that they will vote for UMNO or BN. They meekly admit that the amount is too little to sustain their everyday life when faced with high costs of living.

They are suffering a lot more in life

With prices of all essential items going up there has been a chain effect on prices of other important commodities as well, which are not under government control. Prices of fish, vegetables, transport and meat have all gone up since the last general election. The rich are allowed the monopoly business and they end up enriching themselves. The poor are allowed to suffer and paid a one-off RM500 – after endlessly coaxing them to vote for UMNO-BN – to bear the costs of high inflation. Apparently, UMNO believes that with a pittance one-off payment given to the poor they will forgive UMNO for all their misdemeanours.

What’s more, not all who attend the pomp political sessions to receive the meagre amount are supporters of UMNO or BN. They attend the lengthy political sermons just for the money. Many are disappointed that the amount given is too little as many believe at least RM1000 to RM2000 should be given out to them as they are suffering a lot more in life than what UMNO leaders seem to perceive. “What can RM500 do to sustain my life. I have three children and I am a single mother,” said a 36-year-old woman from Pringgit.

UMNO sounds desperate. This is a sign of absolute desperation. They gather the people in a hall, UMNO and Barisan Nasional representatives will lecture them on UMNO, BN politics and call them to vote for UMNO and BN in the next general election telling the crowd that the money given is from ‘them’. They identify the recipients by their voting areas, make them produce their IDs and their home address. This is a subtle brainwashing technique to fool the uninformed masses.

This session takes three to four hours before a measly RM500 voucher is given to those in attendance – deviously promising them that this will be an annual affair if Barisan Nasional is returned to power in the next general election. This chest-thumping way of politics has not convinced all the people, though. The poor are desperate and they will grab whatever is given to them but this may not translate into votes for UMNO or BN.

“My concern is more of my immediate need. I don’t think UMNO is sincere. That is not important to me. I will vote for a candidate and party that is more sincere in helping the poor, not UMNO or BN,” said a retired government servant from Jasin.

Many are sentient that the money given to them is not UMNO’s money but subsidised by the people or taken from the nation’s coffer. Of course, UMNO would hide this from the people saying that the government is subsidising almost everything for the people. It only shows how ham-fisted the incumbent government is.

Vote for BN vote for Price Increase

“Prices of essential commodities have shot up to more than 200 percent since 2008 under the present UMNO-led government,” complained a farmer from Alor Gajah. He feels that UMNO has done little or just have no ideas on how to contain price increase affecting almost every commodity – from food, farming equipment, fertilisers to immovable properties. “Each time TV3, RTM 1 or Utusan Malaysia mention that there will be a pay hike for government servants and money will be distributed to the people, prices of commodities will shoot up. The trend is always upward and not downward.” To most of these poor people, voting for BN is to vote for ‘increase in price of goods’ or creatively defined with a moniker “Undi BN undi Barang Naik.” (Vote for BN vote for Price Increase).

The UMNO-led government is now becoming truly desperate. They are aware that prices of essential commodities in the market are increasing despite their superfluous claims that they are being subsidised heavily. The masses know that essential commodities like sugar, rice, flour, cooking oil and fuel are all controlled by capitalist business conglomerates who are out there to make huge profits at the expense of the poor. Price increase, especially for essential items, also tend to be higher in urban areas where BN tends to be very unpopular.

Promoting cronyism, unbridled monopolism and capitalism will only see prices of properties and commodities rising further. Capitalist economy knows no mercy for the poor. The rich makes huge profits and yet the government must use taxpayers’ money and other national resources to pay the companies in the form of “subsidies” to generate the economy. In other words, the rich are subsidised with taxpayer’s money but it is made to be seen that the poor are those who are being helped. A shrewd political manoeuvre indeed.

Government is just hollow and desperate

Actually the government is just hollow and desperate and have no ideas on how to make the poor live a comfortable life. The poor are becoming poorer and the rich richer and this is UMNO’s way of managing the country.

They claim to be subsidising prices of sugar, flour and cooking oil when in actuality they are using people’s money to subsidise these items while at the same time enriching the cronies involved in the trading business.

“Prices of rice, flour and cooking oil have all gone up. We cannot afford to buy enough food to feed our children,” said a 47 year-old recipient of RM500 from an UMNO member of parliament in Melaka.

The poor want more from the government. They want their water and electric bills to go down. They demand that prices of rice, cooking oil and flour to go down. They find that with prices going up even prices of fish and vegetables in the market are now up. “Prices have shot up by more than 100 percent. An egg that used to cost 15sen each now costs 50sen. Prices of chicken, beef and mutton have all gone up by almost 80 percent despite UMNO’s economists claiming that the inflation rate is below 3.2 percent. No Malaysians would believe in this figure,” grumbled a housewife from Air Keroh.

Seemingly, the perception is that UMNO-led government is just inept. They have done nothing much to curb corruption, cronyism and nepotism – the trait of UMNO for the past 54 years.

Electricity rate hikes could have been stopped

“UMNO’s version of subsidy is actually helping the cronies, business monopolists and capitalists,” said an economist from a local university. Why are the people paying high electric bills? In 1995, TNB’s monopoly in electricity generation sector ended with the establishment of five IPPs – all cronies – which supplied almost 40 percent of electricity supply to the National Grid.

IPPs signed long-term power supply contracts with TNB and with government support their profits were almost guaranteed. The IPP contracts were guaranteed returns of not less than 20 percent spanning a period of 21-year contract . By early 1997, the country had almost 50 percent surplus capacity from a shortage just two years before that. The ill-advised Mahathir administration then prompted consumers to use more electricity to save the IPPs. The IPP-TNB agreement was obviously lopsided and TNB is obliged to purchase from IPP even though it does not need the electricity. When TNB started to bleed, the government came up with a simple solution to raise electricity rates and let the consumers absorb the former’s high operating costs.

Since 1997 until FY2010, Petronas’s cumulative gas subsidy was at a shocking amount of RM116.4 billion. And IPP enjoyed the biggest share of RM49.3 billion (42.3 percent) followed by TNB (RM37.3 billion or 32 percent). IPP and TNB alone enjoyed a combined RM86.6 billion or 74.4 percent of the total gas subsidy since 1997.

To date, Petronas has paid almost RM550 billion to both Federal and State Governments, making it the major contributor to the nation’s coffer, without which the country would have gone bankrupt. Petronas makes vigorous revenue but the subsidy to IPP and TNB has taken its toll on the net profit. Every year, Petronas pays billions of dollars in gas subsidy mainly to IPP and TNB. In 2008 alone, its gas subsidy reached RM19.7 billion with IPP and TNB taking the largest share of RM8.1 billion and RM5.7 billion respectively.

Electricity rate hikes could have been stopped if the agreement between IPP and TNB had been fair and wise. Alas, because of the blunder made by the then prime minister, Mahathir, almost 40 percent of TNB’s operating costs have been spent in purchasing electricity from IPP and the company has to keep on seeking from the government tariff increase on electricity affecting the poor in many ways.

Money for the rich comes from taxpayers

Ironically, UMNO-led government is still condoning monopoly practices. Rice, flour, sugar, toll, electricity, etc are all monopoly businesses where these conglomerates make huge profits at the expense of the poor. The government is, in point of fact, not helping the poor but help subsidise these huge companies to enrich crony companies and their shareholders. Even with such monopolies, in most cases only some individuals are those who have been enriched and the companies they managed have folded due to improper management under the so-called NEP.

Countries – rich and poor – throughout the world subsidise essential commodities to help the people and the prices of these commodities are real cheap and affordable by their poor. In most cases they do not deliberately enrich the cronies at the expense of the poor citizens. Prices of agricultural products are cheap in all developed and developing countries. Even in the US the agricultural sector is heavily subsidised and the poor can buy food stuff cheap in the market. The US government does not call it 1US. No governments go thumping their chest claiming that the government of the day is helping the poor. It is the onus of a responsible government to help the crucial economic sectors while prudently managing taxpayer’s money. These governments are aware that it’s the people’s money and the countries resources that are used to subsidise the essential commodities and not to indirectly enrich some cronies or companies. Credits are given to the people and not politicians.

In the Malaysian context UMNO politicians are taking the credit for helping the poor when in actual fact they are using the people’s money to do so. Ironically, even after claiming to have subsidised many products in the market, prices of goods still keep on rising. Prices of commodities are not getting cheaper by the day because of trade manipulations. Business monopoly by cronies has caused this to happen. Prices are still escalating and the people are wondering whether there is any substance in this subsidy agenda by UMNO.

Seemingly, there is no sincerity on the part of the present government. ‘Helping the poor’ is merely a lip service – a cheap political gimmick to win the next general election, and the people are bound to face hardship beyond that. UMNO’s long-term policy under Najib’s administration is to reduce on subsidies as proposed by the Performance Management and Implementation Unit (Pemandu) in stages and this will take place after the next GE if BN retains Putrajaya – which most political observers are sceptical that UMNO or BN can last that long. Najib’s team is facing a knotty impasse now as they have promised financial reforms such as subsidy cuts to help trim down the budget deficit and do away with market anomalies, but aggressive reductions in subsidy to traders could further increase the price of goods if business monopoly were to remain.

Subsidy gimmicks

A spike in prices of food, properties, education, services, transport, fuel prices, toll rates and utility bills in the country have affected both the urban and rural populace. Political observers are saying that that the costs of living will be one of the biggest issues in the next election. The urbanites are aware of this and this awareness has also reached the rural population. The rural people are facing hardship as much as the poor urbanites. Most people in the country are struggling to make ends meet when the rich are on a bed of roses minting money, living in luxury and buying properties overseas.

And UMNO-led government will face the wrath of 90 percent of the people in the next GE. There will be a backlash against Najib’s administration. “It will make no difference with all these subsidy gimmicks – the country will see some changes once the BN regime is kicked out of office for good,” quipped an economist from a local university.

Info : News



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