Archive for January, 2012

Malaysia in the Era of Globalization #98

Sunday, January 29th, 2012

Chapter 12: A Prescription For Malaysia

An Open Letter to the Prime Minister

May 13, 2000

Dear Yang Amat Berhormat Datuk Seri Dr. Mahathir Mohamad, MBBS, SPMJ, DSDK, DP(Sarawak), DUPN, DKNS, SPCM, SPDK, SPNS, SSMT, DUK, DK(I), PIS, DK(Perlis), FICS(Hon), SSAP, DK(Kelantan):

I do hope that I have all your titles correct and honorifics up to date. It was so much easier in the old days when you were simply Dr. Mahathir! You seem invigorated lately by the West’s belated recognition of your considerable leadership qualities. While President Bush and others may have been slow in recognizing your talent, rest assured that for many Malaysians, your place in our history books is secure.

No segment of the populace has benefited more from your able leadership than Malays. It must therefore pain you immensely to see in the twilight of your career to have Malays turning against you. You may eerily wonder whether your fate might be like that of your predecessor, Tunku Abdul Rahman. He led the country peacefully to independence; despite that he was later hounded out of office and then ignominiously ignored. The old man later bitterly lamented that even the nation’s history books did not mention his name in recounting its path to freedom. It would be sad indeed were you to share Tunku’s destiny, a man you so mercilessly tormented 30 years ago. The irony would be providential.

The world has changed since the 9/11 terrorists’ attack, and not just in America. Whereas Americans once severely berated you for jailing those extremists, today those same leaders are lauding you for your decisive actions. You rightly see through their hypocrisy, but this time you were smart enough not vocalize it. Obviously to the West, preventive detention and other flagrant abuses of human rights and due process are fine as long as the targets are anti-Western elements.

On your part, you crow about how America is learning a thing or two from Malaysia by adopting some of the elements of the ISA in its new Patriot Act. I disagree with your assessment. The Patriot Act is meant for foreigners, not Americans; the ISA on the other hand is directed against our own citizens. In your enthusiasm for what you think you can teach America, you have missed this essential difference.

As leader you have given the nation much-needed direction, a vision. Your Vision 2020 aimed at turning Malaysia into a developed and moral society is truly, well, visionary. Unlike many leaders who are consumed with shouting one slogan after another, much like the leader caricatured in Shahnon Ahmad’s short story Ungkapan (Sloganeering), you have backed up your vision with careful planning and concrete proposals. Indeed I would argue, too much planning and too specific a proposal. There are dangers to both. Let me elaborate.

In the mid 1970s the City of Edmonton, Canada, was planning a massive suburban development. The city planners did something unusual. Instead of planning every detail they merely drew up conceptual drawings. They began filling in the details as development progressed. Instead of building expensive sidewalks and pedestrian paths immediately as was the usual practice for example, the planners left empty spaces. A year after the residents had moved in, the natural pathways that they had chosen would become obvious and the city would then pave them. Thus it avoided paving sidewalks that would rarely be used.

The lesson here is that we cannot always anticipate accurately everything; we must therefore be flexible and ready to modify our plans with changing conditions and on the feedback. In short, we should “plan for the unplanned.”

I am skeptical of elaborate plans; the more detailed they are the more detached they would be from reality. I have never been impressed with Malaysia’s multitude of Five Year Plans. They have a faint Soviet odor about them. The Seventh Malaysia Plan that began in 1995 was quickly reduced to irrelevance by the economic crisis of 1997.

It is naïve to think that every governmental activity could be forced into the same five-year time frame. Five years would be an eternity when dealing with Information Technology. On the other hand for education, a five-year span is too short. Policies on such an important issue as education must never be changed on a whim. The same is true of economic and trade policies. Investors want stability when making long-term investments. It would be smarter for each department or sector to have its own short- and long-term plans, with the time frame to be determined independently.

Thus instead of a flurry of meetings consuming the entire government machinery to the exclusion of its regular work and responsibility, have few select committees or commissions to study and recommend what the long-term missions are in specific areas like trade and education, and then develop the short-term plans to reach or achieve those goals in steps.

Having said that, I am still cautious and skeptical of central planning. The problem with Malays today is that our lives have been over-planned. We have been told to this and that, and then later reversed to that and this. In the end nothing works. We were told that our culture and values hinder us in the modern world, and then told to celebrate and hold high our heritage and ideals. We were told to ignore English and to use our Malay language instead, only to be later told on the importance of English. We are urged to pursue the sciences and yet we do not reward those who do take up the challenge. No wonder our people are confused. We have been yanked back and forth too many times.

As I have never believed that a committee or planning commission can achieve anything meaningful, I set forth my own ideas with a view that they would be a starting point for a national dialogue. Over the long term Malaysia must commit to joining the global mainstream, and be an active and contributing participant. We must recognize the inevitability of globalization and the further spread of free enterprise.

We must also recognize that these two trends would continue to evolve. A generation hence they will assume far different and better forms than what they are today. If we do not embrace them now, it would be that much more difficult to adjust later when we would inevitably be forced to join the mainstream.

Additionally we should commit to the ideals of a civil and moral society, and strive to be one. By this I mean a society that values individual rights and freedom; is ruled by law and civil institutions, and respectful of the differences among us. Like globalization and free enterprise, the detailed form and shape of a civil society will continue to evolve, modified by time and culture, but the sooner we embrace the concept the better we will be. It should not surprise us to discover that the ideals of a civil society as envisioned by civil libertarians in the West are also very much the ideals celebrated in Islam.

As a nation we are now closing in on our fifth decade. We have come a long away. We are a far different society today than we were a generation ago, in no small measure due to your enlightened leadership. The assumptions we have of ourselves then are no longer valid today, so too are our policies that were based on those assumptions. We need new strategies to meet fresh challenges.

Without being presumptuous I suggest six specific areas we should concentrate on in preparing our citizens for this new reality.

• Embrace the reality of globalization, free trade, and capitalism
• Enhance the competitiveness of all Malaysians
• Strengthen our laws and civil institutions
• Buttress our social fabric and safety net
• Optimize our natural attributes
• Empower our people

By committing to globalization we are sending a clear message not only to our citizens but also the world that Malaysia is now adopting international or universal standards. We no longer accept that being “good enough for Malaysia” is good enough. We are already doing many of these things. There is however, a significant difference in doing something grudgingly or because we have to, and doing it because we are committed to the ideals. It is all in the attitude, or as we say in our faith, the niat.

Right from the very beginning Malaysia wisely eschewed socialism, although we have not shied away from massive state interventions in the private sector. Initially the rationale was to achieve social and racial equity, but like so many government initiatives, these programs have a life and momentum of their own. Thus even though they have proven to be not the most effective ways of addressing the problems as well as their massive price tags, nonetheless they have persisted and expanded though sheer momentum.

You insist that the “commanding heights” and strategic sectors of the economy be under local or even public control, in the belief that they are too important to be left in the private sector or foreign hands. I disagree. I have no qualms were Malaysia Airlines (MAS) and our giant utility companies like Tenaga Nasional and Telekom Malaysia be controlled by foreigners.

The job of our government should be to ensure that we have enough trained Malaysians to be their executives, professionals, and technicians. There is no point in MAS being government-owned if it is a drain on the Treasury or if its local managers are incompetent. Our precious and limited resources ought to be diverted away from owning these expensive companies and instead directed towards developing our most precious asset: our people. Once we have an abundance of trained and capable personnel then it would be easy for us to start our own local ventures. What you are now doing is putting the cart before the horse. That has never worked and never will.

Your ambitious Multimedia Super Corridor project bogs down for lack of competent personnel. Your preoccupation with and frequent harping on the Bumiputra and non-Bumiputra rivalry is shortsighted and counter productive. We should make all Malaysians competitive. We should look upon each other not in terms of the Bumupitra and non-Bumiputra dichotomy, rather as potential clients, customers, and business partners. We would achieve this best under free enterprise. To a businessperson it does not matter where his profits come from: locally from his own kind or from foreigners.

Next: Embracing Globalization

Malaysia in the Era of Globalization #97

Sunday, January 22nd, 2012

Chapter 12: A Prescription For Malaysia

In 1969, shortly after the traumatic race riot that nearly ripped Malaysia apart, an angry and impatient young politician wrote a most unusual letter to the prime minister at the time, Tunku Abdul Rahman. Written in Malay, the letter used the most polite and deferential language, tone, and form that characterized communications between a peasant and his ruler. It was classic of a feudal Malay society, as Malaysia was at that time. Despite that, the petition could not hide its blunt and trenchant message: The Tunku must go.

Such a frontal challenge to a leader was unprecedented in polite and highly structured traditional Malay society. Malay society prides itself in an orderly and predictable succession. That gauntlet could only have been thrown by someone either unbelievably stupid and reckless or very sure of himself and his assessment of the citizens’ mood.

What galled the Tunku was that the challenger was a low-level politician who had lost his parliamentary seat in the elections that took place just before the riot. Most losers in combat would quietly withdraw to lick their wounds, not come out swinging looking for new adversaries, at least not so soon afterwards! Yet there it was, the impudence and impertinence of a hitherto obscure political backbencher challenging the nation’s revered leader amidst a national crisis! Incensed, the Tunku saw to it that the politician was expelled from the party. Thus was how Mahathir bin Mohamad was stripped of his UMNO’s membership.

It was a tribute to the Tunku’s basic humanity that he did not do more. He could have easily behaved like the usual Third World leader and declared Mahathir “prejudicial to the security of Malaysia,” and thrown him into the slammer. Or worse! Many a Third World politician have met untimely fatal “accidents.” Mahathir in turn was smart enough to lay low and not further provoke the Tunku. If only some of today’s adversaries of Mahathir were as smart!

In the end the Tunku did resign, and the ever-wise Mahathir did not crow. After a suitable grace period in deference to the Tunku’s sensibility, his successor Tun Razak “rehabilitated” Mahathir and soon after, appointed him to the important position of Minister of Education. The rest, as the cliché goes, is history.

Thanks in large measure to Mahathir, today Malay society is less feudal; communications between the rulers and ruled are no longer formal, rigid, or deferential. They are direct and often frontal, dispensing with the ceremonial and reverential language of the past.

Mahathir is no Tunku, but more to the point, I am no Mahathir. I have simply chosen the following format of a letter to the prime minister merely as a literary device to summarize my book. Nothing more and nothing less! Thus I do not expect a Tunku-like response from Mahathir, nor do I await a Mahathir-like fate.

Next: An Open Letter to the Prime Minister

Malaysia in the Era of Globalization #96

Sunday, January 15th, 2012

Chapter11: Embracing Free Enterprise

Encouraging Entrepreneurialism

Starting Small

The remarkable thing about these initiatives I describe is that individually and in the aggregate, they would cost very little. The default rate for such loans is very low, as demonstrated by the experience of Grameen Bank in Bangladesh. But the most important benefit of such a scheme is that it would encourage trade among ordinary Malays and teach them the value of business and free enterprise. This would help eradicate the ingrained mindset of forever waiting for the government or someone else to provide them with a paycheck.

Once we have succeeded in producing such low level entrepreneurs then we could move up the ladder, to professionals and sub-professionals like accountants, lawyers, and engineers. From there, the government could then target the bigger contractors and major players. And with involvement at each level, the government would have better experience in assessing the risks and viability of the various individuals and proposals.

The difference between my plan and the government’s present strategy is that I let the market decide who should get the benefit of government help, not some all-knowing civil servant back in Kuala Lumpur. Further my plan is considerably cheaper and impacts many more people, in contrast to the present where billions are being lavishly squandered on the few. Lastly my plan will produce real entrepreneurs, not the armchair types that the Malay community currently have in abundance.

The remarkable observation about many successful companies of today is that they all started small. HP and Apple Computer were both started by engineers tinkering in their garages. No Washington official earmarked them for success. Grooming entrepreneurs from below would prove more enduring and successful, in contrast to the present strategy of starting at the top.

My point is, we do not know where the next spark will come from. What is important is that we must create the conditions whereby should that spark ignite, it would start a chain of reactions far and beyond. This notion that some high and mighty bureaucrat or esteemed leader sitting in his air-conditioned office in Kuala Lumpur could pick industry winners, is pure bunk. And their track record proves it. The sooner Malaysian leaders disabuse themselves of this delusion the better it would be the nation.

One of the lessons of history is that no society that values order above everything else will encourage creativity among its citizenry. Such societies will be orderly all right, but they will not be creative or blazing new trails. The reverse is equally true, that is, without some degree of order, creativity will disappear.

Earlier I alluded to the history of ancient China. The Chinese of the 15th Century had all the necessary ingredients that could lead them and the world into greater heights and to launch their own Industrial Revolution. They already had blast furnaces and piston bellows for making steel, discovered and used gunpowder, compass, paper and printing. But a mighty emperor ruled them; his edict was law and it could not be challenged. In his wisdom he declared that those were useless inventions and ordered their activities stopped. Being an orderly society, the Chinese meekly complied. Four hundred years later the Europeans would reinvent what the Chinese were doing routinely centuries earlier.

Unlike the Chinese, these enterprising Europeans, unrestrained by a God-like emperor, were able to tinker with their inventions and collectively they ushered Europe into the Industrial Revolution.

Consider the polar opposite of China: Russia immediately preceding the Bolshevik Revolution. The chaos of a dying empire produced a slew of luminaries in both the arts and sciences. In the world of music and arts there were Stravinsky, Tchaikovsky, and Kasimir; in literature Tolstoy, Dostoevski, and Chekov; and science Mendeleyev (periodic table) and Pavlov (Physiology). Living in the chaos of a dying empire and unable to revolt against the powerful Czar, they bravely challenged orthodoxies in their own fields.

Had there been order and the Czar maintained his tight grip, he could have easily squashed these super achievers with their brash new ideas and creations. Creativity thrives in chaos but without some semblance of order, those Russians could not translate their brilliant innovations into a successful economy.

“To advance and use knowledge,” writes Lester Thurow, “a society needs the right combination of chaos and order.” Too much order (China) and you have stagnation; too much chaos (Pre Bolshevik Russia) and you would not be able to capitalize on those inventions. A contemporary example would be Japan (too much order that it stifles creativity) that now remains stagnant after a brief period of advancement, and America that thrives as it has found the right combination of chaos (freedom) and order.

What is true of economic and scientific activities is also true for the arts and other creative endeavors. As noted by my favorite poet Chairil Anwar, “In Art, vitality is the chaotic state; beauty the cosmic final state.”

These same dynamics between order and chaos also operate on the level of the individual: the tension between tradition and rebellion. Einstein’s early life had all the characteristics of a drop out: he quit school, renounced his citizenship, lived at the margins of society, and indeed regarded himself as a gypsy. Those early chaotic days belied his later genius. His General Theory of Relativity, a unitarian concept, ironically brings order to the apparent chaos that is the universe.

Chairil Anwar thrived in the chaotic days of pre-independent Indonesia. His most well known poem “Aku” (Me!) reeks with this fearless expression of rugged individualism and irrepressible yearning for freedom. To quote:

Aku ini binatang jalang (I am but a wild animal
Dari kumpulannya terbuang Cut from its kind
… …
Dan aku akan lebih tidak perduli and I should care even less
Aku mahu hidup seribu tahun lagi! I want to live for a thousand years!)

If there is indeed a Malaysian Chairil Anwar out there today, he would more likely have been kicked out of school; or if he ended up at the local university, he would have been long ago been detained under the ISA. But had he been born in America today, he would have earned millions writing lyrics for some hip hop groups or be lauded as the nation’s poet laureate.

It is for this reason (too much order) that I worry about young Malays attending religious schools. The emphasis there is on blindly following what is already established, with no room for critical thinking and independent thought. Any streak of independence is quickly stamped out. I do not expect to find future agents for change in Malay society to emerge from the present religious institutions.

Malaysia, and the Malay community in particular, has its fair share of the talented and enterprising. In their preoccupation for order and emphasis on conformity, Malaysian leaders are inadvertently snuffing out the independent spirits of their citizens. Progress depends on those daring to challenge the existing order and push the envelope beyond. Malaysian leaders must not only tolerate diversity and differences in opinions among the citizens but also more importantly, encourage and celebrate those differences. We must encourage divergent viewpoints, as we will never know which one will prove to be right. Sadly the leaders confuse unity with unanimity. Malay unity does not and should not mean Malay unanimity.

I look askance at the control freaks currently in charge in Malaysia. They have a penchant for controlling everything and everyone. They would prefer that their followers be like sheep, bleeping to their every command and following them blindly. It is a tribute to the enduring qualities of ordinary Malaysians that they are resisting to the best of their ability to maintain their spirit of merdeka (independence). Some openly rebel and end up being punished; others pay mere lip service to obedience, yet others affect embarrassing obsequiousness to the powers that be.

Events are with the people, not the leaders. With globalization and the spread of capitalism, the pace of these changes will hasten. It is for these reasons that I urge Malaysia to embrace free enterprise enthusiastically. But as Margaret Thatcher wisely observed in her book, Statecraft, there is a difference between doing something for pragmatic reasons (because they work) and doing so out of conviction. Capitalism has proven itself to be the best system to bring the greatest prosperity to the largest number of people. It is also compatible and consistent with our Islamic traditions. Islam began around free markets, and it is time we return to our roots. And do so with great conviction and enthusiasm.

Next: Chapter 12: A Prescription For Malaysia

Hold The Accolades!

Wednesday, January 11th, 2012

Hold The Accolades!
M. Bakri Musa

Now that Judge Mohamad Zabidin Diah has acquitted Anwar Ibrahim on his “Sodomy II” charge, there is no end of praise heaped upon the judge specifically and the system of justice generally. Prime Minister Najib was quick with his smug assertion that “neither politics nor politicians have any influence over the dispensation of justice.” Foreign governments too have been effusive with their praises. Some now brazenly call for Anwar Ibrahim to apologize for his earlier criticisms of the system.

Hold the accolades! This sordid trial reveals everything that is rotten with the Malaysian system of justice. This case should never have been prosecuted in the first place. That it was reflected the level or more precisely lack of professionalism on the part of these career prosecutors. As for the trial, there were many instances where the judge could have thrown the case out, as when the physical evidence was introduced. Now the learned judge used that as the reason for acquittal.

As for Anwar Ibrahim, he and his family are rightfully grateful for the verdict, but hold on to your apology. Forgiveness, yes, as he said recently; that is always praiseworthy. He rightly cautioned that one court decision does not a judicial spring make. Besides, there is still the monumental task ahead to clear up the mess, and not just in the system of justice. Najib’s much-ballyhooed “transformation” is a charade concocted by his exorbitantly-paid consultants.

Doing Away With Anwar

The decision to do away with Anwar was made a long time ago. In opting for this particular route, they had hoped that whatever the outcome Anwar would be irreparably damaged by the smear. How they misjudged! The public remains convinced that the charge was politically motivated, and crassly at that, right from the very beginning.

The tragedy here, apart from the agony and humiliation Anwar and his family had endured, is that a delayed-adolescent college flunkey desperate for his 15 minutes of fame was being exploited. They used the poor boy as a battering rod, pardon my metaphor, to do in Anwar.

There is only one possible redeeming value to Judge Zabidin continuing this trial in its squalid entirety, and that is to expose the pathetic lack of professionalism of not just the prosecuting team but also the other professionals involved. This included the police officers and crime investigators to the forensic scientists tasked with the crucial DNA analysis and the senior specialists who examined Anwar’s accuser.

Consider those medical specialists. They failed in their duty to inform and educate the court; they owed the court their individual professional judgment, not a committee report. Unlike paid experts, those government doctors were not beholden to the accuser or accused, only to uphold the truth. If they had doubts they should so inform the court. Likewise those chemists; before they performed the DNA analyses they should be satisfied of the integrity of the specimens. If they were forced to perform tests on specimens of questionable integrity, they clearly should have informed the court of their doubts.

Those specialists were based at the General Hospital Kuala Lumpur, an apex institution in the government’s healthcare system; thus presumably they must be the best. They should also have known that this was a very high-profile case and that their performance would come under global scrutiny. It should have been an opportunity for them to showcase their talent and professionalism. Instead the judge singled out the inadequacy of the physical evidence, as reflected in their reports and testimonies, as the reason for acquittal.

The only physician who had acquitted himself well was the foreign doctor who first examined the accuser. That doctor had the conviction to document clearly his findings and impressions without first having to “discuss” it with his superiors. That he had to flee the country afterwards reveals much about our system of justice.

If in his written judgment Judge Zabidin were to comment on the quality of the prosecution’s expert witnesses and address the performance of the prosecution, in particular the alleged gross breach of professional conduct where one member was romantically linked with the accuser, then I will not only take back my criticism but would praise the learned judge profusely. Then there was considerable wisdom in his letting the trial go through its entire course – to serve as a much-needed “teaching moment” for the nation.

At its most benign the alleged prosecutorial misconduct could simply be the case of a young man and woman with raging hormones. At its most sinister, it is “witness coaching” brought to a whole new low level. When that wild allegation first surfaced, the prosecution dismissed it, only to admit later that the alleged woman was only a “junior” and thus an inconsequential member of the team. Never mind that she was a lawyer, a fellow professional.

The prosecution was led by the government’s top lawyer, the Solicitor-General. He is a career civil servant, not a political appointee and thus, at least theoretically, immune to political pressure. Nonetheless he should have known that in this day and age, the charge of sodomy is patently laughable. Major jurisdictions including the US and Canadian Supreme Courts have decriminalized the act except where it is non-consensual. Heck, even the Chinese Supreme Court has ruled similarly!

Even in Malaysia that statute has rarely been invoked. The only time it was used was in 1998, and the victim was again Anwar. That conviction was subsequently overturned on appeal, but not before he was incarcerated for six long years. If the Solicitor-General had invoked sexual harassment charges instead, that at least would have highlighted an all-too-common problem.

Even if the physical evidence had been compelling, recognizing that this was a high-profile case with all the political implications, and aware of the poor reputation of the judiciary in the eyes of the public, it would have been prudent to appoint an independent prosecutor. That would remove any suspicion of political influence. That the Solicitor-General did not again reflected the caliber of his judgment. The irony is that this case was decided soon after he submitted his early optional retirement!

The verdict not withstanding, many unanswered questions remain. Najib has yet to explain why he met this confused young man just days before he filed the complaint against Anwar. If, as Najib intimated, that they were discussing a scholarship, I can suggest a few other much more talented Malaysians now at top universities who are more deserving of such attention.

Najib and the other UMNO leaders are forever proclaiming that Malaysia is an Islamic state. In this case both the accuser and the accused are Muslims. Why not invoke the shari’a? They did not, for the obvious reason that had it been invoked, both accused and accuser would have to be charged as there was no element of force.

Far from being a turning point, this trial illustrated and highlighted how dysfunctional and ill-equipped our institutions and personnel are in the administration of justice. I predict two things: One, the judge’s written judgment would be long in coming; and two, he will not be bound for promotion any time soon.

As I suggested earlier, hold the accolades.

Malaysia in the Era of Globalization #95

Sunday, January 1st, 2012

Chapter11: Embracing Free Enterprise

Encouraging Entrepreneurialism

NEP’s Failure to Nurture Malay Entrepreneurs

As a long distance observer, let me suggest some reasons for NEP’s failure in this endeavor. They all boil down to that basic defect of too much central planning and too rigid top-down command. Instead of trying to create an environment where budding Bumiputra entrepreneurs could thrive, the government went much further to actually select which individual Bumiputras would thrive and succeed. These central planners presume to know the traits of a successful would-be businessman. That these planners—politicians and bureaucrats—have no experience in starting or running a business is conveniently ignored. Such hubris! No surprise then that the pseudo entrepreneurs that the system produced were more adept in cashing in their close association with the politically powerful rather than being true creators and builders of wealth. They in turn perpetuated that same system in choosing their own set of suppliers, subcontractors, and vendors. Thus was born a class of Bumiputra entrepreneurs and businessmen more skillful at commercializing their political ties rather than being true wealth creators; a class of rent seekers and economic parasites rather than of genuine entrepreneurs.

These individuals with their new wealth and political clout began flexing their power. They easily convinced the government that juicy public contracts and privatization projects be reserved for them in the belief that their enterprises would quickly reach a sufficient size and strength that they could then take on the world. They wanted to create their own kampong version of the Japanese keiretsu and Korean chaebol. These big Bumiputra companies would then act as a locomotive to carry the rest forward. That at least was the theory.

The reality, as with all centrally hatched plans, was far different. The relationship these new companies had with their suppliers and vendors down the feeding chain was more predatory than supportive. These companies acted less like locomotives and more like the head of a serpent devouring every competitor, Bumiputra and non-Bumiputra alike. They effectively snuffed out other new entrants.

One example would suffice to illustrate the massive clout of these new Bumiputra pseudo entrepreneurs and their destructive predatory behaviors. In Kuala Lumpur of the 1970s, the government issued a number of bas mini (mini bus) permits to provide transportation services to the many small suburbs sprouting around the capital city. These new settlements were too small to merit regular bus services. Thus the bas mini was an ideal compromise between cheap public buses and the more expensive taxis.

That brilliant strategy resulted in many mini bus owner-operators. The program succeeded in creating a class of true small-time entrepreneurs not only in the form of owner operators but also in the supporting services, including repair shops and coach builders. The public too benefited from the frequent and convenient bus service. It became a point where these mini buses became ubiquitous in the capital city, and plans were afoot to introduce them at other major urban centers. They also have a cute acronym, BMW – Bas Mini Wilayah (Federal Mini Bus). It would certainly impress your co-workers when you assert that you come to work in a BMW!

It did not take long for the powerful government-sponsored pseudo entrepreneurs to muscle in. They convinced the government to cancel those permits and to give the franchise to their major bus companies instead. Overnight these owner-operators saw their investments became worthless. The government decided, persuaded undoubtedly by the politically connected entrepreneurs, that the big bus companies could provide a better service than the mini bus operators. Of course the government never bothered to ask the consumers.

A better strategy would have been to let them battle it out in the marketplace. Whoever provides the better service would win. This hubris of top government officials presuming to be able to pick winners in the private sector is major factor in the economic crisis of 1997. Sadly, the government has yet to learn its lesson. It continues with the same pattern. Only this time some other new favored players are replacing the Tajuddin Ramlis and Halim Saads of yore. Contracts and projects are still being awarded sans competitive bidding. A decade hence the story would be the same, only the characters and ventures would change.

I suggest that if the Malaysian government were to invest in future business tycoons it would be more fruitful to seek these individuals at our Sunday and night markets rather than nurturing those armchair “entrepreneurs” in their business suits who frequent UMNO’s divisional meetings and general assemblies. In 1976 I read a book written by a Canadian economist who was in Malaysia documenting the economics of these small-time hawkers. I would have expected that pioneering research to spawn other studies, but I have not come across many.

Let us take the simple enterprise of selling fried bananas. This simple business has all the ingredients of a major corporation. There are all the details of cash flow, marketing, sales, expenses, and inventories. These hawkers could all be taught the basic concepts of a business enterprise by using his roadside stall as a ready and concrete example. Thus someone could organize them into a purchasing group so they could buy their supplies (flour, cooking oil, gas and other perishables) in bulk to effect substantial savings. And lowered costs would contribute directly to the bottom line. This is true with multinational corporations as well as roadside hawkers.

Then someone could teach these hawkers to expand their “menu.” They could for instance, expand into providing cold drinks or tea. That would directly add to the revenue. Or to use the sophisticated business term, diversifying their product line. Additionally they could plant their own bananas instead of buying them. To put it in business terminology, bringing their suppliers in house; or vertical integration. That would definitely reduce their costs and boost profits.

The improvement or learning process does not stop there. The more enterprising hawkers might consider offering a gourmet menu by using the sweet tasty variety of bananas like pisang raja (royal banana), charging extra of course for the premium product. Or they might cater to health-conscious customers by using low-salt, low-calorie, and low cholesterol ingredients. They might even go further upscale and make not the routine fried bananas but instead baked them in molasses, and then serve them in nice plates just like they do in fancy American restaurants. Call the new product banana flambé! They can even add rum to the concoction for their non-Muslim customers. Or serve them as ala mode combination with ice cream. All these product enhancements would serve to increase the value and hence the price that could charge. There is literally no limit to the potential with even the lowly fried banana business.

To those who dismiss such possibilities, think what they have done with the simple cup of coffee. It spawned the Starbucks chain, where the humble 50-cent cup of coffee now goes for a couple of dollars! There might just be a enterprising hawker out there who, with the proper encouragement, support, and skills, could spawn a banana ala mode chain of convenient snack foods.

What could be done for the lowly fried banana sellers could be also be done to other low level entrepreneurs like the small time service providers: barbers, cosmeticians, tailors, mechanics, plumbers, and the like. I would provide them with low-cost loans to start and or expand their businesses. With the tailor, for example, I would fund him to further his skills so that he could update his fashion designs. Similarly with barbers and hairdressers, so they can charge more for doing more creative and personalized hairstyling and cutting, instead of the usual tempurong (straight cut) style for every one.

Next: Starting Small