Malaysian Maverick: Mahathir Mohamad in Turbulent Times by Barry Wain (fantasy novels to read .TXT) 📕

profits. The phenomenon was known as "money politics", and it dictated behaviour as much as, or more than, the official party rules and regulations that prohibited it. On more than one occasion Dr. Mahathir shed tears in public about vote-buying in UMNO party elections, but he failed to stop it. His presidency saw the final culmination of a transition from an UMNO of humble and self-sacrificing peasants and schoolteachers to a party of self-serving corporate chieftains and dealmakers.

Although the money-making opportunities through UMNO were known, the extent of the party's investments was not so obvious. As a political party registered under the Societies Act 1966, UMNO was not permitted to be in business. To conceal its assets, the party used the common practice of nominee companies or executives, or alternatively, trusted individuals, prominent businessmen who surreptitiously held stakes in various companies on UMNO's behalf. The trail could lead through a bewildering maze of transactions, involving shell companies capitalized at the legal minimum of RM2 and companies that were repeatedly reorganized and renamed. Another convenience for UMNO was that a private Malaysian concern whose shares were held by fewer than 20 individuals had "exempt private company" status, which meant it did not have to file financial statements with the Registrar of Companies. Documents filed by companies with government or political ties often were not available to the public for scrutiny at the registry, anyway.

After UMNO ventured directly into business under Dr. Mahathir and Daim and some of its trustees were publicly known, the party faced financial oblivion when it was declared illegal in 1988. Its assets were required to be placed with a government agent and sold off. But in a process that was never made clear, most of those assets ended up in the hands of many of the same people who were holding and managing them for UMNO before. The arrangement enabled Dr. Mahathir and Daim to maintain that the party, reconstituted as New UMNO, was no longer in business, which was only technically true.

While UMNO, as a political party, was required to submit its accounts each year to the Registrar of Societies, and it tabled a balance sheet at the party's annual General Assembly, the party did not disclose the real state of its financial affairs. Not even the party's Supreme Council, the highest policy-making body, could peek at the "UMNO Political Fund", whose very existence was never disclosed. The council entrusted the party's financial secrets to the top leadership: While he was supposed to keep Dr. Mahathir informed, Daim alone knew the details.[2] Two other official UMNO trustees, the party deputy president and secretary general, were not informed. So, along with the general public, UMNO's millions of members remained in the dark about the party's multi-million dollar enterprises, even though the assets theoretically belonged to them.

UMNO's strategic role in the distribution of patronage contributed to the severe factionalism that convulsed the party in Dr. Mahathir's time. In former finance minister Tengku Razaleigh Hamzah's challenge to Dr. Mahathir's leadership in 1987, the party dissidents directed much of their ire at Daim, who was accused of stripping UMNO for personal gain. Because of the way he mixed his private investments with state and party business, it would be a recurring theme for as long as Daim remained as party treasurer. After he quit in 2001, significant sections of UMNO were convinced he had pocketed billions that belonged to the party. Daim denied it, as did Dr. Mahathir, the only other person with access to the books, who then took over as treasurer for two years. When he stepped down in 2003, Dr. Mahathir handed his successor, Abdullah Badawi, the prime ministership and UMNO assets of RMl.4 billion, in property, shares and cash.[3]

Although the form differs, links between politics and business are widespread and growing in almost all East Asian countries.[4] In Japan, major corporations fund particular factions within the ruling Liberal Democratic Party.[5] Thaksin Shinawatra, who became prime minister of Thailand in 2001, brought with him representatives of some 15 major business groupings who were able to seize control of the state and contrive business-friendly policies.[6] Under Dr. Mahathir and Daim, Malaysia followed the example set by Chiang Kai-shek's Nationalist Party, which ruled Taiwan for 55 years until 2000 — and returned to power in 2008 — in taking direct or indirect control over a vast array of corporate assets.

Their enterprise was light years removed from UMNO's early days, after its formation in 1946, when founding members used their own money to fund party activities. So tight was the budget in 1954 that Tunku Abdul Rahman, as president of UMNO and representing the Alliance, had to share a bed with a member of his delegation when they visited London to discuss pre-independence constitutional arrangements with the British.[7] The Tunku recalled that in those days he drove and cleaned his own car because he could not afford a driver. At one point he sold 14 shophouses — two- or three-storey buildings with businesses on the ground floor and residences above — and donated the proceeds to UMNO. After independence, he realized he had disposed of almost all his personal property to contribute to the party, and others had done the same.[8]

As the Tunku's successor, Razak Hussein was keen to end UMNO's financial dependence on non-Malay supporters — its coalition partner, the Malaysian Chinese Association, as well as Chinese businessmen and companies — for election campaign expenses, emergencies and, embarrassingly, even for routine activity. At times, an UMNO official at headquarters could not afford transport to keep an appointment — say, to talk to villagers. He would have to wait for the Malaysian Chinese Association to send over a cheque, which then had to be cashed, before summoning a taxi to get to the meeting.[9]

Razak was also under pressure from UMNO's youth wing to take control of the foreign-owned, Singapore-based media company that published Malaysia's main English-language daily, the Straits Times. To buy it would require funds, and UMNO's decision