A Doctor in The House: A Memoir of Tun Dr Mahathir Mohamad (39 page)

In the meantime, the Government was working on a new, detailed policy to give the Malays and other Bumiputera a fair share of the economic wealth of the country. A team was set up to devise and implement an economic strategy, which later became known as the New Economic Policy or NEP. It was not immediately apparent how Tun Razak was going to achieve the NEP objectives but at least he made it clear that he wanted to correct economic imbalances. He was a pragmatist, not the blind slave of any particular ideology. He was prepared to borrow ideas and policies from anyone so long as they might serve the Malaysian interest.

I was heartened by Tun Razak’s leadership, though the changes he made must have hurt the Tunku. These were necessary changes, but not any that the Tunku himself, with his hands-off approach to policy implementation, could have directed. Another aspect of the change in direction was foreign relations. Tun Razak made it clear that Malaysia was to be non-aligned and was to establish friendly relations with all countries, regardless of their ideology. The Tunku’s extremely pro-West foreign policy was to be diluted.

At home, Tun Razak worked vigorously on the NEP. Its main feature and objective was to restructure the economy both to eliminate poverty irrespective of race, and the identification of race with economic function. It was clear that the latter statement meant Malay participation in the country’s economic activities and non-Malay participation in the public sector. A study by the Prime Minister’s Department of the ownership of national wealth found that 60 per cent of the country’s economic wealth, as represented by share holdings in big corporations, was owned by foreigners, 30 per cent by the Chinese and the rest by the other races. The Malays and other Bumiputera owned less than two per cent.

It was decided to reduce foreign share to 30 per cent while the Chinese share was to be raised to 40 per cent and the Malay and indigenous share to 30 per cent. This approach was carefully balanced. The policy was to be carried out not by expropriating what belonged to the foreigners but by enlarging the economic cake. From the new growth, a bigger share would be apportioned to the Malays and the Chinese. The foreigners would have to make do with a smaller share of the new growth until their portion shrank to 30 per cent.

I was doubtful of this strategy at first. The Chinese share had to grow by only a third of what they already had. For the Bumiputera, it was a completely different story. Since they now owned less than two per cent, achieving the 30 per cent target meant that their share would effectively have to grow by over 1,500 per cent.

But I could see no other way. Taking away what already belonged to the Chinese and the foreigners would prompt intense resentment that would have slowed, not promoted, the country’s growth. There would be less, perhaps very little, new wealth to redistribute. Despite Government assurances that non-Malay wealth would not be touched, a fairly large number of Chinese sold out and emigrated to Australia and elsewhere.

I was happy with this affirmative action policy because I always felt that unless the extreme disparity in wealth between the Chinese and the Malays was corrected, tension and animosity would never be erased. The last time that resentment surged to the surface, the 1969 riots ensued. For Malaysia to be stable and therefore politically and economically healthy, that economic gap had to be reduced, even if it could not be eliminated completely.

After my ouster from UMNO, I was interviewed by Leslie Hoffman, a well-known journalist from the 
Straits Times
. His conclusion was that I was still maintaining my “hard line”. I pointed out that the restructuring under the NEP had to involve some channelling of opportunities from the Chinese to the Malays. I qualified that by saying “… the authorities will have to deny some Chinese applicants places in the university and in the government service. Some Chinese who are qualified would not be able to get jobs or promotions in the Government service”.

But I also added that “something as drastic as this is necessary if the situation is going to be changed in any permanent sense”. Hoffman pointed out that 
The Malay Dilemma
 had made me very popular with the Malays and many young UMNO members regarded me as “the ideologue” of the “new order”. Hoffman himself was not convinced by my ideas. He was one of those who thought there should not be any discrimination in favour of the Malays. Asked about the Alliance coalition, I said it was the best way for the Malays and Chinese to work together and I complimented the Tunku for this. But he had only concentrated on the top layer, leaving little cooperation on the ground. Still, I believed that only the Alliance formula would work.

The Press frequently sought my opinion of the Government and asked about my rejoining UMNO. My answers were always cautious. I noted that the new Government was more pragmatic but I was non-committal about my re-entry. The local English and vernacular newspapers as well as the foreign Press tried to pin me down on the subject whenever they could. I was good copy for journalists—I was controversial without being inflammatory. With my reputation or stigma as a pre-1969 “ultra” still intact, I was a convenient bogeyman for all those who were opposed to doing anything to redress Malay disadvantages.

These days the foreign Press still want my opinion on things happening in Malaysia. My not being in Government has not changed their attitude towards me. They still regard me as a Malay racist who jailed my deputy. No amount of evidence to the contrary will change this perception.

For my part, when asked a question I just state the truth as I see it. While it is the truth from my perspective, my viewpoint regularly clashes with the perceived wisdom of the day and the stand people take in general. When I was cast out of UMNO, people did not say I should be silent, that I had lost my right to speak and be heard. On the contrary, they wanted to know what I was thinking. After I stood aside as Prime Minister, things were strangely different. People seemed to think that I either had nothing more to say or I had no right to say it. This difference is largely due to the policies of Tun Abdullah Ahmad Badawi. I got back my voice only after he was forced to retire as Prime Minister.

In July 1971, an incident occurred which was misconstrued by many, but ended up working in my favour. I was invited to present a paper at an UMNO Youth Seminar in Morib, a town in southern Selangor. Tun Razak came to open the event. UMNO Youth was then under Harun, who had always supported me, and Tun Razak had raised no objection to my being there.

As Tun Razak was leaving the seminar, I was pushed forward by the jostling crowd around him. For the first time since my expulsion I met him face to face. Naturally, I greeted him and shook his hand. The Press snapped a picture and it appeared the next day on the front page of most papers. We had simply greeted each other but the picture suggested that a full reconciliation had taken place. Once more a whole flurry of questions was raised about whether I would rejoin UMNO. Tun Razak was smiling in the photograph but people made more out of it than they needed to. Still, for me it was progress.

I then delivered my paper on automation and unemployment. During the break the Press again asked me whether I would be rejoining UMNO. This time, I replied, “Slowly, slowly. Wait until next year”.

My concern, even worry, for the country made me continue my criticisms of government policies, even after indicating that I would like to rejoin UMNO. I hoped the Government would take note and would act on some of my ideas so I accepted many invitations to speak at events. I often spoke about the urbanisation of the Malays. I believed they could only progress if they left their 
kampung,
 or if the 
kampung
 were developed into small towns. The Government subsequently spoke of the urbanisation of the Malays and other indigenous people.

As usual, I thought it would be easy. Malays would go into retail business and the towns would not be so exclusively made up of Chinese shops and businesses. This would bring Malays, Chinese and Indians together. I pictured Malaysian towns and cities where the businesses and shops would be evenly distributed among the races. In 1969, when the Malays rampaged through Kuala Lumpur burning shops and vehicles, they could be certain in most areas that all shops belonged to non-Malays, primarily the Chinese. But when the towns had shops and houses belonging to all races, things would be different. If Malays again torched shops in anger, they would also be likely to destroy what belonged to their own community. They might then think carefully before resorting to such actions.

Unfortunately, reality did not prove so simple. When Malays began migrating into the towns and cities, they did not go into the same businesses as the Chinese. Instead, they illegally occupied vacant land and built huts to live in that were actually worse than their former kampung houses. In these urban
kampung
, they started little shops in haphazardly scattered shacks made of zinc and timber, with plastic sheet roofing and extensions. These areas lacked proper roads and drains. Dirty water flowed from shops and houses onto to the earthen roads. There were flies everywhere. These squatter settlements quickly became slums, ironically located near skyscrapers of granite and marble.

Today, people in these high-rise buildings still look down on the rusty zinc-roofs and dirty alleys of the slums. And when these skyscrapers happen to be hotels, foreign visitors are given a full view of how the Malays live in a country where they exercise political power, where they dominate the Government, and where they like to think of themselves as the 
tuan
. Malays often talk of 
ketuanan Melayu
, but does living in zinc-roofed slum huts reflect their exalted position as masters?

In time, I came to understand why urbanisation led to an inferior quality of life for the Malays. Urban living is more costly. One cannot grow food or rear chickens and everything has to be bought. Without a reasonable income it would be difficult to survive. Besides, a migrant to the city leaves his family, his first-line social support group, behind in the 
kampung
. He can no longer fall back on them for support or sustenance. Rather, it is the other way around: urban migrants are supposed to earn enough money to send some home. They must now adopt and adjust to a whole new lifestyle and culture, one that is rooted in the cash-based consumption of even basic living necessities. Cash is always scarce and hard to earn. Migrants to the cities either did not realise this before leaving the villages or else, in their eagerness to leave, they did not care.

Later when the Government built multi-storeyed flats for these slum-dwellers, they refused to move in, demanding single houses like those in the 
kampung
. It was as if they imagined that they were still living in the village. They arrived from the countryside without the capacity to conduct any kind of business. They came expecting to get jobs but most available work was far from where they lived and travel always costs money. What they earned could not support an urban lifestyle. They started small businesses selling food, stationery, secondhand clothing and so on, but these businesses remained small and insufficiently capitalised. They rarely interacted with others and the mixing of the different races which I had envisaged did not take place.

Living in towns is not only about bright lights. It is about being skilled enough to be employed or to do business. It is about being savvy and understanding that the road to success is built upon hard work and discipline, even if you have to start small. It is about a willingness to adjust to a new way of living. Failure to do and be all these will result in a life more barren and deprived than in the rural areas they had left behind. The myth of urban living is that it is always a move up the economic ladder. The bitter and lasting reality is that it can be a descent into squalour.

When I see most urban Malays today I grieve, largely because they have not made the necessary adjustments. I had no idea that this would happen when I suggested that Malays move into the towns and cities. I was naïve. Governments may plan but it is the response and behaviour of the people that determines the results. Yet the urbanisation of the Malays has not been a total failure. This is a topic which I will return to later.

Besides Malay urbanisation, I also spoke on other issues, usually at the invitation of UMNO Youth. I spoke against the excessive use of machinery because unemployment was high in those days. Machines often displace labour rather than absorb it in intensified employment and production. Our early attempts to industrialise had not been very successful. We tried the path of import substitution: manufacturing the products we usually imported but only for our own market. It did not work as there were no economies of scale. Since our domestic market was very small, everything we produced for ourselves cost much more. Nor did we team up with foreigners to acquire their advanced technology. Buying the latest expensive technology made no sense in producing for a small market.

We also tried to manufacture our own tyres, which seemed to be the right thing to do as we produced rubber. But we found that the cost per unit was high and the technology input low. In any case, we had to import components like wires and threads, and we soon realised that there was a lot more to making tyres than just having easy access to cheap local rubber. In the end, the tyres we produced were not even good enough for our own market. We could not export them, so we could not earn foreign exchange. Import substitution had been the favoured policy during Tun Razak’s time and even earlier under the Tunku, although he never pushed it as hard as Tun Razak did. But that choice was not their idea alone. It was the dominant idea at the time in development economics, favoured by most leading international experts. It was the orthodoxy of the day—until it proved unsustainable, not just in Malaysia but worldwide. Our Malaysian experience disproved the belief that, if you have the raw materials, you can produce things more cheaply.