Are our children really living better than us ?

In 2003, I submitted a memorandum on the proposed KL 2020 Structure plan to DBKL. Prior to that, in the process of gathering data for this memorandum I did some research and talked to some professionsals in the fields if architecture and town planning. I was called up to present the memorandum to DBKL but apart from that, I have not heard anything from DBKL again.

I mentioned then that one of the most disturbing features in KL was that the ratio of house price versus annual income. Kuala Lumpur has a average ration then of 3.27 which is considered high. The ration will be even higher now, because house prices has gone up since but not the income. What this means is that for most of the population, they are spending almost 30% of their annual income for housing , which is very high, when it should be about 5%.

Why is it so? It is because we have not enough medium as well as low cost housing. In year 2000, 51% of total housing in KL was of high cost units, whereas medium and low cost housing was 24.9% and 24.5% respectively. While the low income group is the majority in KL , there is just not enough low and medium cost houses . This also means that while the housing needs of the rich are more than taken care of, the needs of the poor are not tackled properly.

This also means that for a fresh graduate, it is almost impossible to own a house. For a fresh graduate working in Kuala Lumpur, the first thing that he needs to own is a car, given that public transport is so bad and often, without a car,  he would need to take 2 or 3 change of buses to reach his place of work. That would mean that he would have to spend at least 3 hours on buses every day to and fro.

 So a car is a necessity for those not living or working near a LRT line. And that goes for most people living in KL and PJ. A car is no more a luxury to these young people. But car prices are not cheap. Very often they have to spend 30-40% or even more of their income just to pay for car instalments, petrols, road tax and maintainance. RPK has written an excellent article on this titled: Back to basic 1968-2008 . I quote a part of it here:

As of last month a Toyota Vios would ‘cause a damage’ of about RM 89,000

In the international market, a Toyota Vios is about USD 19,000.

USD 19,000 = RM 62,700 (using the indicative rates of USD 1 = RM 3.30).

That makes Malaysian Vios owners pay an extra RM 26,300.

This RM 26,300 should be cost of operations, profit and tax because the transportation costs have been factored in to the USD 19,000.

RM 26,300 or RM 625 per year translates to a Vios being used for 42.08 years.

I do understand that the RM 625 is a rebate given by the government, but it also means that one has to use the Vios for 42.08 years just to make back the amount paid in taxes for the usage of a foreign car. Would anyone use any kind of car for that long?

Why is public transport so bad and why is car prices so high? We have to thank our Dr M again for his vision of having a national car project. To sell national cars , imported cars are purposely taxed until most people have no choice but to buy the lower quality national car. And why should public transport be improved when the idea was to sell more national cars? If the public transport was made good, then who would want to buy cars? How would crony companies sell parts to the national car company if everyone took public transport?

 I have nothing against national cars, but at least, if you want to sell the national cars, you must make sure that it is of high quality (using high quality but competitively priced parts and not by using highly priced but inferior parts from companies owed by you-know-who) and able to compete with imports and not by taxing the imports so high that you have no choice but to buy the lower quality cars. That is against free market principles. To sell something, the thing must be of good value and must be good quality… any kid can tell you that.  Protectionism for 5 initial years might be alright for the national cars, but to protect it for 20 over years is against any economic wisdom.  I have written a few posts on the national cars, just use the search engine in this blog to do a search.

Now back to the young graduate. Apart from the hefty car instalments that a young graduate pays for in order to arrive in his work place punctually, he needs of course to pay parking which is again not cheap. Many people resort to parking illegally along road sides and in abandoned clearings, but the cost of paying summons (or tea money to enforcement) may even be higher than the legal parking fees. Then he needs to spend on petrol to make the car move… and petrol prices…….sigh!

Then they need to eat out for lunch at least. If they need to drive a car to work, the workplace must be far from home. To go home for lunch would not be economical. But to eat out means another 10% of pay gone.   Factor in the handphones bill and internet bills, which are no longer considered luxurious items but necessities in modern living. There are other expenses of course, like clothing, entertainments etc…  Some may even need to give some money to their parents but most parents, unless very poor, would not want to burden the children so maybe a token payment  suffices. But for those really poor parents, the young man would have no choice but to support the parents…

For those who do not need to support the parents, how much is left?. Maybe 20 % of their pay or less to save for the rainy days… .(For those who need to support their parents, I can tell you they have practically nothing left, and they may be potential clients for Ah Long). How to own a house when the house price and annual income ratio is greater than 3 times and average person would be expected to spend up to 30% of his or her income on housing alone if he wants to owe a house? 

So I really pity the young people coming out to work. They have practically no money left after all these expenses, and they cannot afford to be sick of course, being hospitalised in  private hospitals is no joke!!!

One of the most important responsibilities of a good government is to ensure that people have a shelter above their head which they can called home. A shelter over the head is a necessity and if a person cannot even afford to own a house, then there is really something wrong with society.

Why spend billions on allowances/holidays on top officials and white elephant projects when these money can be better spent to build more medium and low costs houses for the needy, which in the present era, includes even the graduates and some professionals. Or use it to spend to improve the public transport system.

The modern poor is no more just the beggars in the streets (some beggars may even be richer than these young working people), but rather your children and my children.  Sad?  But true.

Does economic advancement mean anything to the people? Is our lives really better than 20 or 30 years ago? are our children richer than the children of bygone generations? I leave you to figure it out.

 

 

13 Comments (+add yours?)

  1. pohwatchdog
    Jun 12, 2008 @ 21:02:59

    We have good plan for car industries but lack of foresight to maintain the industry. We need to manage our economy prudently and not waste as we like. We need to live smartly but no doubt we have the hard core and the poor.

    What we want is a better alternative of transport? What wrong with Dr. Mahatir vision to have every Malaysian own a car? With the time is bad and speculation about the gloomy economy, we the people need to cooperate to cut down unnecessary expense. The government need to tighten the enforcement by the police, City Hall and civic conscious from the people.
    We are then to be too selfish and chasing after the money. Have we see foreigners occupied the road in Chow Kit Market and Jalan Tuanku Abdul Rahman. Are we creating mini-Jakarta or United Nation place ?

    Time to review, refocus, champion for all Malaysians. Subsidies or not, life have to go on and need to spend smartly. What alternative Pakatan rakyat government have for the rakyat?
    We are listening and not demontration to create
    unstability. We need more investment from oversea to create jobs for Malaysians not foreigners. At the end of the days, we need enforcement, commitment and dedicated government servant to make Malaysia a better place and enjoy by all Malaysians.

    We don’t need a complacent and too relax attitude
    (never mind lah government). hopefully Pak Lah is listening and Pakatan Rakyat government have better alternativer than BN. I am listening and reviewing

    Like

  2. novice101
    Jun 12, 2008 @ 21:20:38

    Economic advancement – that’s a laugh! What advancement are we talking about? Indebted to the financial institutions and the ‘Ah Longs’ through over-spending, stuggling to finance the chlidren’s education, and living on shoe-string budgets in our twilight years, the poor cannot afford to be sick – is this what we call economic advance?

    The Malaysian priorities are messed-up. Our feet are not firmly on the ground – the ‘Malaysia Boleh’ concept is carried to absurb proportions.

    We build colossal structures to impress, for glory (empty glory), hold international events to satisfy our inflated egos, squandering away precious dollars, while our deserving students have to be denied their opportunities for further education. What a perverted sense of priorities.

    Like

  3. novice101
    Jun 12, 2008 @ 21:35:18

    Your article is written from the prospective of the younger generation. It would be good if someone who has the materials to write a piece from the prospective of the pensioners.

    Though the young are facing an uphill battle, they still have the advantage of energy and time on their side. The poor pensioners are going under the economic stress.

    The politicians in Malaysia are not giving enough attention to this group of people. In fact, saying they are neglecting them would be more correct.

    Bloggers should take up the issue and speak up for them.

    Like

  4. jeff
    Jun 12, 2008 @ 22:52:41

    For the young Malaysians to have a better future, they have to get rid of umnoputra racists out from Malaysia government, that is the only way for them especially if they are not Malay, plain n simple….even those racists are claiming they are so much wanted by Malaysian voters that they will never get voted out,so Malaysians are getting what they voted for.

    Like

  5. Y C Chai
    Jun 13, 2008 @ 10:43:33

    The essence of a progressive society is transparency whereby information is curtailed in whatsoever manner as it is a source of knowledge or data for discussion/debate and thus better solution as a result. Hence, we need to fight for abolition of OSA, enhance free press and cultivate openness in pursuing “sensitive issues”.

    Back to the source of quality of life, what comparison could we make in the absence of genuine data. What was apparent is only absolute income difference, full stop. No critical analysis been tabled by any research organisation that takes into account purchasing power parity index, inflation rate and comparative figure against other countries etc. I wonder what the “think tank” or “strategic research unit” of political party like MCA , Gerakan and DAP did for the past decade ? Mere political and election analysis ? Even then, it is very shallow and general.

    It’s high time, we need to do some home work and economist, social scientist, as well as town planner and environmentalist come together for a meaningful review of our current city living condition base on a variety of factors. Perhaps also, political parties need to engage such experts to obtain more professional views or input to enhance their ability to govern or improve quality of debate in legislative meetings.

    Like

  6. nick
    Jun 13, 2008 @ 12:06:09

    I dare say that the young people of today definitely have a better qualitative life than the baby boomers. Firstly, they live and breath in the internet age where info is at their finger tips, you-tube makes life so enjoyable. Mobile phones are common. have you met anyone without a phone? Now I can watch my favorite footabll team (EPL) on astro. Back in the early eighties when I started my first job and trying to start a family, there was no PC, no handphones, no astro. My first car was a proton saga and i loved it. My past times was not spent in the Mall but at the Shah Alam parks and it was a family thing. We never grumbled. Well try not to anyway. Life was much simpler. We never begrude others who had the means to live in bungalows or go for foreign holidays. Today, Air Asia makes it more affordable to hol within the region. All the young people who work for me seems to have a better life, I am talking about “qualitative” wise. In conclusion, Malaysia as a Nation has mature into a nicer place, our Shopping Complexes are world-beaters, our Highways are second to none. Ok ok some bloggers will think I just come from outer space. But staying in the positive mind frame, our nation can get even better if we get rid of corrupt and incompetent flip-flopping political leaders. If only our cabinet can behave like Sime Derby or Public Bank, just imagine what Governance and Accountability would turn our Nation into. Sorry I am long-winded but thanks to Dr. Hsu’s kindness for providing this excellent blog forum, let me rant. I also think our private hospitals and medical care have gotten better over the decades. Oh before signing off, our 4-star and 5-star hotels are simply the best priced in the world!!!!

    Like

  7. ay
    Jun 13, 2008 @ 14:49:19

    the high car prices is mainly due to the excise duty imposed by the government. once it was used as a mechanism to protect Protton, now it is more to raise revenue with the advent of FTA.
    Car owners are being over-taxed. Upfront excise duty and now the high petrol prices. of course, the ubiquitous tolls (i guess Malaysia has the largest number of tolls per km of roads) which are designed to enrich the cronies. Well, you have to thank Mahatir and hsi side-kick Samy Vellu for the tolls and I dont know how this administration can unravel the lopsided agreements.
    Enough said, Dr Hsu coz its not going to change anything now. No pointing in griping now and its up to us as responsible voters to vote wisely come the next election.

    Like

  8. petestop
    Jun 13, 2008 @ 16:00:45

    Will Gerakan sack Dr Tan ?

    In doing so, shows every bit that they are UMNO running dog.

    Or are they going to show that they have backbone for once ?

    Just bcoz you are the state opposition now, you cannot help the state government for the betterment of the Rakyat ?

    Who are serving really ? UMNO your political master who keep you on a leash, or your own greed ?

    Like

  9. petestop
    Jun 13, 2008 @ 19:02:23

    No, Mr nick, having more shopping complexes and electronics gadgets does not make one’s life better.

    If you want a fast forward look, then just visit Hong Kong.

    Do you want our children to live like that, no day, no nights, can hardly see the sky ? Everyday cramped into a 300~500sqft pigeon hole that they called apartments ?

    We want a balanced development that takes care of our natural environment, so that our children don’t have to breath polluted air.

    I would rather my children are able to walk everywhere, instead of having to drive.

    Just take a look at Penang, there is hardly any walkway for people to walk !!

    We get out of bed, go to work, straight into lifts, and cars, carparks, back into lifts and into our office ?? What the heck, we hardly walk at all ??

    I’m sure our good Dr Hsu here will be able to advise that walking is good for your health.

    Is this what you call development ??

    Our children should be able to run free, unafraid of any criminals snatching them, or cars running them down, or pollution from the streams they jumped into.

    Like

  10. jeff
    Jun 17, 2008 @ 13:13:35

    Quality of life mean one get to live in a crime free environment, breath fresh air, have enough food, decent housing, honest government, and get pay with livable wage at work, having the freedom in pursuing your interest n spiritual life, not just the physical structures n modern gadgets one can get in the country.

    Like

  11. Dr Hsu
    Jun 17, 2008 @ 13:25:23

    well said, Jeff!

    Like

  12. jeff
    Jun 18, 2008 @ 00:03:18

    You are welcome , Dr. Sometime our fellow Malaysian has “weird” sense of understanding of the real meaning of English word. Hopefully Dr.’s blog can educate some of them.

    Like

  13. jeff
    Jun 23, 2008 @ 02:31:54

    Dr., so many years of this “twisted” education system umnoputra placed in the country has retarded many of our youngsters’ minds, it is so sad their mentality had been regressed so much compare to my early year in the fifteenth in which our education system is still quite intact and competitive worldwide.

    Like

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