ON 11 Nov 2008, the Prime Minister’s Department answered a question about income distribution that I had submitted before the start of the current parliamentary session.
The reply was read by Deputy Minister in the Prime Minister’s Department SK Devamany, who gave the following figures based on a 2007 Statistics Department survey of households:
The figures, if accurate, reveal several realities about our society. The first is that 38% of Malaysian families have a monthly household income of less than RM2,000. I believe that RM2,000 should be used as the poverty line and not the current unrealistic standard of RM720 per month for a family with three children. Only 5% of Malaysian families have a monthly household income of less than RM720.
The second significant point is that the prevalence of poverty among non-Malay bumiputera groups is much higher than that of the Malay community – 25.8% of Kadazan families and 35.8% of Orang Asli families receive household incomes of less than RM1,000 compared to 9.9% of Malay families. Numerically, however, Malays still make up a huge majority of the poor in Malaysia because of their population size.
Why have we failed?
Why the high incidence of poverty among the Malays despite four
decades of targeted affirmative action? (© Paulo Correa / sxc.hu)
Why is there still such a high incidence of poverty among the Malays despite four decades of targeted affirmative action? This is an important question to address. Only if we understand why we haven’t managed to eradicate poverty among the Malays can we successfully address poverty among other groups like the Kadazans, Ibans and Orang Asli.
My Pakatan Rakyat friends will pin the blame on corruption, cronyism and wastage by the Barisan Nasional (BN) government. While it is true that corruption and cronyism do siphon away government funds, it cannot be denied that the BN government has for the past 40 years tried hard to address Malay poverty.
Massive resettlement schemes for the landless, for example, have resulted in more than 120,000 families of Felda settlers. Irrigation projects in rice growing areas and agricultural subsidies such as for fertilisers, and price guarantees have also been implemented. Then there is the comprehensive education programme from primary right up to tertiary education, the good network of rural clinics, and other measures. Why have all these efforts not succeeded?
The answer becomes apparent when we ask ourselves, just who are the Malays who are poor? In 1957, about 75% of the Malays were poor farmers. Today, less than 30% of Malay families are farmers. And even among this 30%, more than 130,000 are Felda or Perlop settlers.
The majority of the Malays have migrated to urban occupations, and many are working in low-wage jobs in factories and in the service sector. There are those who are chronically under-employed because many Malaysian bosses prefer to hire more suppliant foreign workers. All of them are affected by the government’s low-wage policy, further reinforced by the active policy of opening the floodgates to cheap foreign labour (out of the Malaysian workforce of 13 million, three million are foreign workers). Escalating costs because of the privatisation of basic amenities is another significant factor leading to Malay poverty.
FDI at workers’ expense
Fewer Malays want to work in agriculture (Source: sxc.hu)
Low wages and privatisation are the macro-economic policies that our government implements in order to entice Foreign Direct Investment or FDI. Both BN and Pakatan Rakyat leaders believe these are essential for Malaysia’s economic wellbeing.
Privatisation becomes necessary because the government wants to reduce investors’ tax burden to make Malaysia as attractive as Singapore and Thailand, which have lower corporate taxes.
Ahmad Boestaman, Dr Burhanuddin Helmi and Chin Peng were right. In the late 1940s, they argued that in addition to winning political independence, the country also needed to redefine its dependent and subservient stance vis-à-vis the imperial centre. The Left believed that an independent Malaya would need to re-negotiate its position within the world economy. The conservative Alliance elite that took over from the British did not see the need to do so (one main reason why the British passed the reigns of government over to them).
As a result, we remain dependent on the investments, technology and markets of advanced countries up till today. The price we pay for that is the “race to the bottom” where we have to compete with Thailand, Vietnam and Singapore to attract foreign capital. Along the way, our workers’ interests are compromised.
You can’t solve poverty in our ranks through welfare handouts, not when 38% of our population requires such assistance. We need to re-open the issue of what exactly constitutes a just wage in this day and age. We need to return to the pre-Merdeka debate regarding our subservient position within a globalised economy where corporate profits are far more important than the basic needs of the majority. We must bear in mind that that debate was settled in favour of the conservatives and the economic elite by a process that was far from democratic.
Unless we resolve these issues, the avarice of the global economic system that is based on profits for the largest corporations will ensure the continued poverty of a large portion of our rakyat.
Dr Michael Jeyakumar Devaraj is a physician by training and a founding member of Parti Sosialis Malaysia. He is currently Member of Parliament for Sungai Siput.