Neither here nor there

Budget 2011 is out. The most glaring point in this budget is that we are back to the so called infrastructure play. Billions will be spent on infrastructure. While this will help to push for economic growth, I have a feeling of deja vu, and a sense not unlike seeing ‘Back to the Future Past’.

This sort of spending will ensure many big companies getting billions worth  of projects, and many of the not-so-big companies getting millions worth  of subcontracts, and many of the small companies getting the crumbs.. We also need hundreds of thousands of foreign workers, since Malaysians have generally shunned being  construction workers.

In the process of awarding contracts and subcontracts and subsubcontracts, everyone will probably be happy since there will be plenty to go round, like what happened in the 90s before the Asian financial crisis. Stock market plays based on rumours of getting contracts will be back again, and again many people will be happy.

However, the budget has not addressed the problems of preparing the nation and society for innovative change nor dealt with any structural changes.

While the MRT projects are necessary, even though I have certain reservations of the costs, the 100 storey building is totally irrelevant to propel the country towards a high income nation. To think that by building tall  high rise, we can become a high income country is like thinking that a student can be a straight As one  by just shifting the marking curve.

One lady minister was quoted as saying that since other cities are building  the world tallest buildings, we should also do this. This is like after seeing people wear big hats, we also want to wear big hats, not knowing that our head may be too small for those big hats, and in the end, the big hat may even cover our eyes, making us losing our vision.

Furthermore, we already had the Petronas Twin towers , which is already among the tallest buildings in the world. We have already proven to the world that we can build high rise, why the need to do it again?

The 5 billions could have been used to build more schools and libraries , and improve on the quality of our teaching faculties in our universities, so that we can produce world class students, not graduates that cannot even write simple English letters.( I know of a 30plus dentist  from a  local U who cannot even write nor speak proper english; cannot even write a legible meeting minute).

The perennial problems of the biggest portion of the budget  going towards the operating expenses have persisted, no thanks to our bloated civil service, and too many ministries/ministers and departments. Imagine, for every dollar government spends, 75% goes to just operating expenses, and only 25% can be used for development. It is like a company spending too much on its overheads, and too little on expanding its businesses or on R & D. This type of companies will slowly lose their competitive edge.

The 6% service tax on paid tvs means that middle class in the cities will be squeezed again. Those who subscribe the complete Astro package is now paying over a hundred dollars per month, and with the tax, they will have to fork out an additional 10 dollars at least.  The 1% increase in service tax will be mainly borne by the urban folks too. It is not wrong to say tht life is really getting tougher living in the cities.

A young graduate living in urban areas now  now needs to pay for ever increasing costs of living , plus to pay for handphones bills, plus internet service, and now, even eating out or having a drink with friends will be getting more expensive, not to mention the rise in petrol bills, the need to pay extra 50 dollars just to have a credit card…. The salary for a fresh graduates has however remained stagnant at around 1500-1600. Even if they do not eat out, and just eat bread  and water at home, these 2 (bread and water) have become  more expensive now than a decade or 2 ago.

The million dollar question in the whole ETP is this: How to get the private sector to invest, given that many companies have preferred to expand overseas.. With the decrease in FDI, and the lack of confidence of the private sector, the whole picture painted by the government  is just  too rosy..

12 Comments (+add yours?)

  1. Albert
    Oct 17, 2010 @ 22:00:53

    PETRONAS Twin towers were fully occupied only after 2004, thanks to PETRONAS own business units, Murphy, SHELL and most gas/related companies. Traffic is horrendous within the KLCC, expecially after office hours and Fridays. The new tallest buiding to be built in vicinity of Stadium Merdeka/ Stadium Negara will be hard put to find tenants to fill its 100 storeys. At moment, traffic flow within this vcinity of this area is very good, but in view of limited space to expand the roads, traffic in this area in the future will be worst than KLCC

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  2. clearwater
    Oct 18, 2010 @ 09:27:37

    If the 2011 Budget is another example of “Najibconics” at work, prepare now for doomsday in Malaysia. He has no stomach to tackle the country’s many ills. He just wants to remain in power. The budget is a junket for civil servants, they eat up most of it administering the country.

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  3. sosong
    Oct 18, 2010 @ 09:30:00

    The most exorbitant is not the 100 storey tower, but the RM40 billion MRT for K.L, if it is only 140km, it works out to be RM285,000 per metre, China built the super high speed train from Wuhan to Guangzhou, many bridges, tunnels, at only RM56 billion (960km). Following super train costs for comparison, all in RM
    a) Wuhan-Guangzhou, 57 billion, 960 km, 59,400 per metre. Many bridges, tunnels.
    b) Taipei- Kaohsiung, 48 billion, 360 km, 133,300 per metre, include many land aquisition cost.
    c). Proposed Ho Chi Minh city- Hanoi, 176 billion, 1680km, 105,000 per metre. Vietnam postpone indefinitely, no money.
    40 billion is more than the proposed cost for super train to Singapore.
    Anybody have an explanation for my question?
    RM5 billion for the proposed 100 storey building is also way too expensive. Are they going to fully (100%) engage expensive Japanese n Westerner (not necessary skillful) to do these 2 jobs?
    Is the Petronas Twin Tower not fully utilized now? In South Korea, Taiwan, USA, China, super tall buildings (except maybe telecom. tower) were undertaken, funded by private enterprise, not government.

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  4. chabalang
    Oct 18, 2010 @ 11:10:12

    The title of an BT (S’pore) article aptly described the 2011 budget: “GRANDIOSE PLANS, NEGLECTED PRIORITIES”

    As for our bloated government – it’s well-known fact that M’sia has one of the highest government workers per capita in the world (I refrained using the term “civil servants”- neither civil nor serving – just listen to the racist rantings made). The Govt. jobs are for political and social engineering purposes rather than serving the rakyat or long-run economy/well-being of the country.

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  5. ykltpm
    Oct 18, 2010 @ 11:40:02

    PM tries to follow Dr.M footstep by creating another icon during his reign.

    If it is a 100 storey “Warisan Rakyat” which is a 100 storey apartments for the Rakyat, I will fully support it. But, since it is going to be for commercial only, why not build 200 storey ? The reason being if you build 100 storey now, the next PM will build 120 storey to surpass you and the following PM will build 150 storey to surpass his predecessor and never ending. So you build 200 storey now, it can last you for a few tens of decades.

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  6. CYC
    Oct 18, 2010 @ 13:01:49

    Looks like UK trained economist is just another ubi setengah masak. He is directionless economically but so attentive politically when preparing this budget or gadget (political one) I presumed. Key phrase of BN’s philosophy : Increase in cost without burdening the public. But I really need to engage some Cambridge or Oxford trained linguist to enlighten me on the exact meaning of this futuristic piece.

    Dr, the main trust of ETP is to shift the P&L item to become a Balance Sheet item, thus they keep on emphasis 92% of the money will come from private sector. But who will be the guarantor for the infra project like MRT that run into billions. Financiers will not loan such mega sum to Gamuda or UEM unless it is guaranteed by the govt in one way or another. Can the govt tell us if a compensation clause like one in all the highways concessions be inserted into the new proposed MRT and other highways concessions/contracts? Or they have already preempt this query therefore it is no more regarded as privatisation or PFI but public-private partnership program instead.

    Who is the winner in this budget if not the cronies? The economists at EPU or PEMANDU are just decorators who dressed up the PM(King)’s new shirt.

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  7. chanjoe1
    Oct 18, 2010 @ 13:29:00

    I agree its setting priorities wrong. Definitely its an “Election Budget” as its a grind to mill out more money and successful contractors will have to take care of cost for certain party’s election fund.
    Its very clear this budget is not for the people but to milk the people…A 100 storey building and with Dr Ng Yen Yen saying will bring in more tourist to see the 100 storey building? She doesnt know what she’s saying.
    Time to act and no more chance for BN.

    Like

  8. foo
    Oct 18, 2010 @ 14:57:36

    An election budget. Nothing much for ordinary folks. Specific measures targetted at specific voters profile.

    Civil servants keep benefitting the most despite being the most ineffient and bloated in the region.BN wants their vote badly.
    1st time house buyers are usually young(25-35) are they are important vote bank. However 50% reduction in stamp duty probably save them RM2500-3000.
    Sabah and Sawarak gets mentioned often in last budget and this one,when we hardly hear before 2008. Definitely to “bodek” those gullible folks in the ulu with infrastructures goodies which should by right be done years ago.

    A Budget planned more for it’s (BN’s) survival in the coming GE than for the people’s interest.
    Get rid of this BN/UMNO and take a chance to see what others (PR) can do and offer us.

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  9. disgusted
    Oct 18, 2010 @ 17:05:28

    Najlis is the tempatan david copperfield, illusionist transforming perceptions but not the real substance everything he intends to touch. Next comes the Barang2 Naik Nasional. A dinner on 27th this month at the grand residence of 1PM and 28th, the next day a Bohong Nasional gathering at the Mysian Crocodile Association Hq.

    There the 1N will deliver his transformation proposal for the dying Barang2 Naik. Let’s wait for the illusion message.

    Like

  10. AgreeToDisagree
    Oct 18, 2010 @ 21:51:27

    Criticisms and point all valid. But just what are any of us doing to ensure these corrupt and racist MP’s do not gain setas again to rubberstamp such projects through? It only costs 15000 to run for election on these point that you bring up.

    Are those who are especially in the know, have influence in society, have the funds to run, or are considerate to understand that independents are needed now, understand that we cannot trust any political party, ready to step up to candidacy, to free the Rakyat rather than merely complain on the sidelines?

    All it takes for evil men to triumph is for good men to do nothing. Act if you wish for a better Malaysia!

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  11. Li Li Fa
    Oct 18, 2010 @ 23:18:06

    History is repeating itself. Mahathirism is being revived but taking a transformed role of Najibnomics. Both share the common basis of spend , spend and spend even if it bleeds the nation’s coffers.

    Funny thing is human has a high ego wanting always to tower over others. Even the tower of babel met its final days. Figuratively, one needs to come down to earth. We are human after all.

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  12. Trackback: Tall does not mean you can get recognition! « Dr. Hsu's forum

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