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

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Scandal, What Scandal?

Dr. Mahathir's administration took office in 1981 with the slogan bersih, cekap, amanah — clean, efficient, trustworthy. Almost immediately, however, it became embroiled in financial scandals that exploded with startling regularity, some of them truly spectacular. A few were of an order of magnitude that would have bankrupted most developing nations. But tropical Malaysia was generously endowed with natural resources, notably offshore hydrocarbon deposits, and commanded by a leader committed to rapid development. The expanding economy absorbed the shock of much of the dissipated wealth and, where necessary, the gaps left by the missing billions were plugged with the proceeds of oil and gas exports.

Almost all the scandals involved the government directly, or senior officials and businessmen closely connected to UMNO. In some cases, impropriety — whether illegal or merely ill-advised — was officially authorized or condoned for an allegedly higher purpose. Public funds were stolen in various ways, or simply poured into a big black hole in the name of ventures that bordered on the reckless, improbable, or criminal. The extent of the losses — and in some cases the way the money disappeared — was never fully documented. Dr. Mahathir's administration generally did not hold Malaysians accountable for the financial disasters, and often laid the blame on others. By the early 1990s, cynics remarked that it had been a good decade for bad behaviour, or a bad decade for good behaviour.[1]

Although he initiated, promoted or at least approved some of the undertakings that turned into outright scams, Dr. Mahathir was remarkably blasé about the massive wastage and far from embarrassed that another government slogan was "leadership by example". His eyes fixed on the bigger picture, his vision of a modern Malaysia, Dr. Mahathir was more concerned to minimize publicity about mistakes and misdeeds than to punish those responsible for egregious offences. Two visiting academics, who interviewed him in the late 1990s, were taken aback to find him shrugging off the bad experiences and uninterested in studying what happened in order to avoid a repeat. Noting that Dr. Mahathir on special occasions could be persuaded to sing his favourite song, My Way, they suggested that an appropriate encore would be the anthem of the late French chanteuse, Edith Piaf, le ne regrette rien, I have no regrets.[2]

Dr. Mahathir's ultimate protection was his government's large majority in Parliament and its control of the press and investigating agencies. With a revolt by backbench members of the ruling coalition almost unthinkable, it invariably fell to the small opposition Democratic Action Party and its harried leader, Lim Kit Siang, to try and expose malfeasance. His was a thankless task as the perpetrators or beneficiaries were often "Umno-putras", as Lim dubbed the UMNO elite and cronies. While he could usually count on support from a few non-governmental organizations, their clout was limited by their inability to get their message across in the mainstream media, or interest the police in investigating allegations of corruption and other wrongdoing.

Political scientists R.S. Milne and Diane K. Mauzy, commenting that Malaysia's financial scandals "reached almost endemic proportions" in the mid-1980s, concluded they might have been generated as a result of a "get-rich-quick mentality" that was encouraged by the policy of promoting bumiputras in business. And that, they suggested, may have "led to the pursuit of wealth, untempered by ethics, or even fear of the law".[3] Their observations largely are borne out in the following case studies.

The tin caper

David Zaidner, a fast-talking Egyptian metal trader who travelled on a Swiss passport, packed his bags with a clever idea and headed for Jakarta in 1980. Representing the large commodity broker, Swiss-based Marc Rich & Company, Zaidner wanted to handle sales of tin for Indonesia, the world's second-biggest producer. More than that, he had some unorthodox notions to offer about how the international price of tin could be raised.

Indonesian Minister of Mines and Energy Subroto and officials of the state tin company turned him down flat. They knew Zaidner was smart and experienced enough, but he did not always play by the rules. Back in the 1970s, when he worked for Amalgamated Metals Corporation, he had been fired after company executives raided his office in Zug, Switzerland, and found a troubling paper trail. The evidence suggested he may have bribed an Indonesian official and his Bolivian assistant, who both worked for the International Tin Council in London. There was also evidence of other irregularities intended to gain an edge in the tin market. Although the episode was hushed up to save embarrassment to the Tin Council, the Indonesians knew about it since it was their man who was involved with Zaidner. Subroto was a like-minded ally of the "Berkeley mafia", the team of acclaimed technocrats nicknamed after their alma mater in the United States and appointed by President Suharto, who were committed to restoring the country's reputation after the ruinous Sukarno years.

Undeterred, Zaidner took his proposal to Malaysia, the biggest tin producer, and found a more receptive audience. From his tin-trading activities, he had contacts at Malaysia Mining Corporation Bhd., the world's largest tin concern known as MMC, which was controlled by state-owned investment companies and worked closely with the government to implement tin policies. Through the company officials he already knew, Zaidner got acquainted with Abdul Rahim Aki, MMC's group chief executive, who was politically well connected. The higher Zaidner went, the easier it became to sell his idea. As an acquaintance of the chief executive told Raphael "Rocky" Pura, the investigative reporter who unravelled the escapade for the Asian Wall Street Journal, Abdul Rahim "knew as much about tin as could be contained on one-half of a ten-cent postage stamp".[4] Over the objections of some MMC advisers who knew of Zaidner's tainted past, Marc Rich was appointed as the company's tin-trading agent.

Another essential piece of the picture was Dr. Mahathir's presence at the top of the government. Hussein Onn was still prime minister when the