Thursday, 5 June 2008

A Good Day, with Caveat

While I might need to consider getting a lower capacity car now, I welcome the move by the Government wholeheartedly. Fuel subsidy is something that needs to go - so I praise the present government for doing so despite the immense unpopularity of it. On a positive-side, it might represent, finally, a strong political willpower to do what is right instead of what is popular. To be negative, it could simply mean that the Government has run out of choice but to pull the subsidy. Judiciously, I think it is a balance of both.

Malaysians need to accept the reality of this and regard this as a positive change, for the nation and for all of us - we have been dulled by protectionism for far too long. And I hope Malaysians will accept this change graciously, as responsible citizens.

But make no mistake; now that the citizens are expected to be responsible, there will be very little tolerance for irresponsibilities from the Government. Tit for tat. More display of public wastage, and you can expect Malaysians to be more brutal than 8 March.

2 Cents.


Shawn Tan said...

I agree that subsidies are an aberration on the market.

But an overnight increase of 40% with promise of more to come, smacks of incompetence. The price increases could have been better managed. You don't see central banks going around increasing interest rates by 40% overnight, with promises of more to come, to control inflation.

On a personal note, I don't know how badly this fuel increase is going to spread through the economy. We may both need to cycle around KL now, but then, there are no cycle lanes either and public transport is a mess.

On another note, rising fuel prices should not affect us that much, seeing that we are a net exporter of oil. So, I am not very convinced by the governments' reasons for doing so. Something just doesn't smell right to me.

But then again, I'm not an economist.

We do not have trade unions, and we cannot go on strike. So, I'm not sure how the people are going to demand for a pay hike nor can I imagine any employer increasing pay by much.

Then, there's the problem of inflation. I cannot even imagine what the eggheads in Bank Negara are going to come up with to address the problem.

I'm fully expecting the rakyat to take to the streets soon. I just don't know how the people are going to cope. "Ubah gaya hidup" is easy to say, but darn difficult to do especially if you are already squeezed at the bottom.

Kian Ming said...

Hey Elanor,

Someone pointed me to your post. I've written about the necessity of the price hikes on Malaysiakini.

Shawn has a good point in that the price hikes could have been handled better - for example, in stages. But I think the authorities were afraid of hoarding in anticipation of prices rises in stages.

On another note, I couldn't find your email on your profile. Want to touch base with you to ask you about the Econs department. I did my MPhil there in 1998 / 99 when Buiter was a member of the MPC. Could you email me at Cheers.

Anonymous said...

"Fuel subsidy is something that needs to go - so I praise the present government for doing so despite the immense unpopularity of it"

I agree your above comment. When the supply increase , demand also need to increase or demand increase, supply also increase. this the basic of economics theory.
This apply to (petrol prices being lifted subsidy - pay at market rate.) = supply value increase
(Salary/wages of Malaysian also need to increase since we are paid undervalued - suggested to pay at market rate.) = demand value increase.
the problem is our salary not increase. This cause the inbalance to the supply and demand theory.

NYPT said...
This comment has been removed by the author.
NYPT said...

you tell the man on the street who earns rm1200 with 4-6 kids that this sudden 40%increase is good for him. they will be affected the most.

now umno will call for the revival of the NEP for the next GE, on the pretext of helping the malays economically. gerrymandering has made malay support the most important factor in winning seats.

more money in the coffers plus political ammunition to shoot down malay support for PKR. Its going to be tough for PKR to hold up its multiracial stand if that happens.....this is a strategic political move by UMNO. No doubt they are using abdullah as a bullet proof vest for Najib or Kuli..whoever.

Anwar is going to have a tough them if he does not take over now.

Anonymous said...

I disagree with your view .

As a responsible government, they should not put our oil at or close to market when they have failed to provide alternative transportation solutions. (In addition to many other things such as high car prices, toll roads, etc).

The government had enough wealth for oil (and other natural resources) over the last 30 years plus to put in place things like an effective transportation system (such as a comprehensive MRT system that is fast and can accomodate the growing volume of passengers). We all know what happened why this was not done. And now people do not have alternatives when fuel prices are increased. I want to take public transportation but it is just not feasible. (There is no bus/train from point 1 to 2 where I am going.). As a result the roads are all cloaked up.

What they could have done ? They could maintain the subsidy by forgoing many of their development plans which are unnecessary.

Anonymous said...


I can understand your profession as a post graduate student currently to lend your brittle but unrealistic view and justification on the "tsunami-fuel-hike".

I knew this married couple. the husband works as an office-boy toiling a 6-day-week job earning approx. RM700.00 a month (nett) as the working spouse eked-out two jobs->one a full time room-service -assistant making an underpaid nett salary of about RM650.00 a month. She toiled off making some hard cash as an ad-hoc maid earning an average of RM200.00 a month.

To sum up, the working parents of a
5 schooling filial ekes-out RM1,550.00 a month to cover the necessity of the right to life - food (rigid and gauged intake), the modest form of transportation - a 660 c.c. Perodua Kancil (3rd hand, in your domiciled country, the English would call it a jalopy,
)not to mention other basic necessities.

And, oh, yeah, they dwells on an illegal piece of land ensconce with a wooden hut that frails from the
elevated roofs that filled with plastered holes and a floor built up of woods that you would prefer to stay in jail.

Since their hardship ( commonsensical by the commonest of common dialectics and senses) was further under/ by the domino-effect of the rise of the fuel-hike resulted the soaring of other essential items, life or to put it
justifically for them - is not only on the lam but the right to life and limb which was marginalized by this maurading BN government.

I am not sure that this family's pecuniary grievances can be indemnified by the Government's RM625 per annum (?) grant, could negate not only the unavoidable consumption fuel of their jalopy, not to mention most basic necessities that had skyrocketed?

However, to enter into your arguments that the move by the interim/ previous administration
in repelling fuel subsidies is somewhat responsible and inevitable, I have to annul the abovementioned analogy (the grievances of the said family
to satiate your callous perspective and learned but warped knowledge).

Malaysia is the a crude oil producer and has been amassing billions in this sole trade alone.
Singaporeans paid far more than Malaysians for the exact fuel that their country has deprived of the said commodities and to substantiate that Singaporeans pay more in RM by the BN Government, I have one question that begs an answer, how much in an average Singaporean monthly wage for the same profession and in RM by the same standard of profession?

Venezuela paid less than RM0.20 a liter of oil (by currency in RM).

Nothing personal, but your learned and practiced skills was never tested or proven to be empirical of
effectiveness and any sane justifications.

Your take on this matter is an analogy, sufficing to substantiate that a student in ancillary studies who says that "I support embryonic cloning because it will replicate life or a law student who bragged to defend a charged "criminal").

i offer no offence personally but just your naivety of points and absurd fiasco of logical sense.

I assume to hear and look forward for your counter-arguments in the framework of civilized debate.

Anonymous said...

Hi Elanor,

I like some of the things you have written. I would like to touch base with you. My e-mail is

Anonymous said...

Hopefully no caveat on your blogging.
Keep it up! You may have a wild and unrealistic perception, but keep your writing going.