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Soh-Ling enmity shows sorry state of political patronage

The spilling of the discord between Soh Chee Wen and Dr Ling Liong Sik's family into the public realm is to my mind the tragedy of the MCA, and by extension, the larger Chinese community. I refer to the report Soh(ing) the seeds of discord with Ling (May 28).

I am so sorry to have to say this. This is because the business crony has fallen out with a political patron in part due to the inability of the latter to harness sufficient political clout to protect the protégé from public accountability in the wake of failed businesses.

It is also a protégé that threatens to ''spill the beans'' if he were threatened by and not protected from too rigorous official prosecution. But does the political patron have similar clout to prevent it as those in Umno whose protégés need not leverage with their patrons to bare it all because they are somehow protected in spite of their corporate shenanigans even after their political patron has long left the political scene?

On a more general note, the alleged mixing of business and political patronage in the Soh-Ling relationship is, even if true, hardly exceptional so there is no basic fairness in hypocritically singling them out for vilification when all others, similarly placed, indulge in such practices with alacrity.

Team A or Team B of MCA, what does it matter as if they have no business cronies of their own? So do the politicians in MIC, and needless to say Umno, I am sure.

Under the affirmative action focus of the New Economic Policy — now superseded by National Development Plan — largesse of the state is distributed by politicians to their business cronies.

Which entrepreneur who has arisen to any level of success— or subsequently plunged to the abyss of corporate collapse — does not have a direct connection with politicians or an indirect one through their cronies?

Come on people, this mixture of business with politics is a Malaysian Reality, and a pervasive one at that, and the sooner it is openly admitted, the better. It is the substratum underpinning the political economy of Malaysia Incorporated.

The trouble is such a paradigm of crony capitalism contains a few inherent contradictions.

That it is necessary for the government to be a facilitator of business, both domestically and internationally is a plus point, but that it involves the corollary of corruption that inevitably sets in, unfortunately negates it.

The standard justification for cronyism is, of course, one cannot entrust business to strangers — it has to be trusted friends to whom privatised projects and business opportunities should be given. The important question is: trusted with what?

The country has fewer problems if trust in talent, business capability and commitment is the sole arbiter of award. But this is more often than not, not the case.

Without open tender, cronies are awarded business opportunities even though they have neither experience nor record, but never mind — one can always farm them out to those who claim they have for a sum. Lucrative KLSE listings and corporate reverse takeovers would require various tiers of approvals from various regulatory agencies, of which political patronage again helps to facilitate.

With political patronage comes also easy credit from financial institutions — the other institution that manages public funds often in a manner in breach of its fiduciary duty. "Never mind the superficial feasibility studies based on a mismatch of supply and demand, and the optimistic cash flow forecast based on mismatch of cost and revenues — we take the principal holder's risk who commands the political influence" so financiers will take the position.

Even the resulting plethora Section 176 and Practice Note 4 companies with negative shareholders' funds on the KLSE cannot change this Malaysian political business equation.

New 'promising' cronies merely replace the failed ones. The players may be different but the game is still the same because tradition dies hard.

The reality remains that help is not for free and has to be reciprocated. Corruption, a Malaysian vice, is exacerbated by our other virtue — gratitude. For no reasonable entrepreneur can expect a continuous flow of business opportunities without rewarding their political patron.


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