What’s so special about taxi drivers?
Is it because the plight of the drivers represents the political pushback that the Pakatan government will face in its reform agenda?
The print version of The Malay Mail, a 121-year-old newspaper, will stop on Dec 1. The paper, which at one time commanded a circulation of more than 60,000 copies, is the latest victim of disruptive technology in the media world.
In the United Kingdom, department store chain Debenhams will close down 50 stores over the next two years, causing 4,000 people to be unemployed. Online shopping has taken away customers who prefer to purchase most things — from clothes to even milk — via their smartphones or laptops.
Facebook and Google have taken away a chunk of advertising revenue that would otherwise have gone to media companies. The likes of Lazada, Zalora, Alibaba, Amazon and Mirraw have taken away customers from department stores, causing the closure of large outlets.
The effect of technology on the real economy has cut across all industries – from retail to media and the transport industry. Thousands have seen their regular income levels dropping, or have lost their jobs.
But do we see them holding demonstrations or protest calling on the prime minister or other government officials to intervene and solve their problems? No, they don’t.
So, what is so special about taxi drivers that warranted Prime Minister Tun Dr Mahathir Mohamad to listen to their grouses to the extent that he even offered to resign should they want it?
Is it because Dr Mahathir is the MP for Langkawi?
Or do the taxi drivers in Langkawi, who are generally Malays, represent the epitome of the political pushback as the new government seeks to reform the public institutions that provide support for the lower-income group?
The latter is likely the answer. Under the previous government, the solu- tion would have been a cash handout. Everybody would have benefitted, whether the poor taxi driver or the rich guy who owns a taxi company or a fleet of taxis.
It is not a permanent solution for taxi drivers as Grab is popular. But that will reduce the noise. This time around, however, the government does not have much money to spare.
Moreover, the Pakatan Harapan government was voted in to institute changes in government agencies that are to assist groups such as taxi drivers, and at the same time plug the leakage. Handing out cash to appease certain groups is a practice that we don’t want to see being continued.
Taxi drivers generally fall into the bottom 40% segment of the population, or better known as the B40 category. Their income is low and they are caught in a vicious cycle of living in poverty and ending up with little or no education.
According to the latest Khazanah Research Institute report, households that earn less than RM2,000 a month only had RM76 left after spending for household expenditure in 2016.
The B40 category of people are from various industries – from construction to transport and services. This particular group of people generally voted for a change in the government because they wanted more from the growing economic pie.
If taxi drivers are given privileges, what about other segments of the B40 population who are also feeling the pinch due to the changes brought about by technology?
There is a “Grab version” for lorry drivers and even hoteliers. So, are the workers affected going to be given handouts as well?
The reform agenda that should eventually help the B40 will not happen overnight.
Firstly, there has to be a major clean-up of the existing system and state-owned entities (SOEs) that are entrusted with giving out assistance to the B40 before they can even start helping the genuinely poor.
Under the previous government, there was abuse. In almost every scheme, the rich and well-connected got richer.
As rightly pointed out by Parti Bersatu supreme council member, Wan Saiful Wan Jan, at a recent meeting with bumiputra contractors in Kedah, before the government can even start giving jobs, the list of bumiputra contractors who deserve government assistance needs to be cleaned up.
Otherwise, any restricted tender exercise to award jobs to bumiputra contractors would only result in the same group of wealthy contractors competing among themselves.The new government has said that it will not give blanket subsidy or handouts to all and sundry. The people certainly do not want to see an economic system that thrives on political patronage.
Political patronage does not inspire confidence in investors.
Malaysia has lost two big names in the world of technology to Singapore because of the lack of confidence in the system.
Grab, which was founded in Malaysia by Malaysians and is the most expensive technology company in the region, decided to move its headquarters to Singapore a few years ago. In Singapore, the taxi drivers cannot complain. The fear of the government turning the rules because of political pressure is not there.
The sense of confidence allowed Grab to raise more money from investors.
This week, we lost the race to entice UK-based Dyson to hub its electric car project in Malaysia. Dyson has also gone to Singapore.
Did Dyson choose Singapore over Malaysia because the automobile industry in Malaysia is highly politicised and tends to see government intervention when the going gets tough?
We really will not know, but we have lost out again, even with Dr Mahathir wanting a third national car project.
After seeing the Langkawi incident, when even the 93-year-old prime minister offered to resign despite having won the general election by a big margin, the fear is that the Pakatan Harapan government may not carry out the reforms of the government institutions.
It would be a pity if that fear is allowed to fester. Hopefully, the Langkawi incident is an isolated case.
The new Malaysia has got investors excited. At the same time, they are also watching to see how the new government will handle the reform of public-sector institutions, especially SOEs and other agencies that have been set up to help with the bumiputra agenda.
It takes time and it will be painful. Budget 2019 will have measures to help the B40 segment of the population, but it will never be enough.
The only way to resolve the problem of inequity and leakages is by reforming the agencies in the public sector. Reforms can only be done gradually as it takes time, but time is something that Dr Mahathir does not have in his hands.