Malaysiakini NEWS

US financial crisis mirrors 1997 Malaysia

Terence Gomez  |  Published:  |  Modified:

The Bush government’s US$700 billion plan to help stem the US’s current financial bedlam is reminiscent of the currency crisis in 1997 that had undermined the viability of Malaysia’s leading banks and firms.

Malaysia’s problems then were due to Dr Mahathir Mohamad’s subscription to an economic model that has now contributed to the chaos of the financial system in the US.

But what is also interesting about this US bill, derided in some circles as a bailout of Wall Street, is that members of the Republican Party, a keen supporter of big business, were so hesitant to support it. (Only 65 Republicans backed the bill when it was first proposed on Sept 29.)

Even Treasury Secretary Henry Paulson, formerly CEO of Goldman Sachs, publicly acknowledged that he had been very reluctant to propose this bill as it went against the very economic ideas he espoused.

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