The democratic transition: ON-YOUR-FACE CRONY CAPITALISM
Perhaps, the President is making a point
There were two disturbing developments last week. First, it was President Maithripala Sirisena’s speech at an event held at the Sri Lanka Foundation Institute, where he expressed his ‘displeasure and disgust’ at the hauling before the court of the former Defence Secretary Gotabaya Rajapaksa and three former commanders of the Navy, in a case filed by the Bribery Commission.
The President’s speech sent shivers across the country, for it implied a clear departure from the pledges, he made during the election - and had tried to live by with a varying degrees of success since in power.
Many observers viewed it as a growing rift between the President and the UNP, the main constituent party of the Unity Government, being played out in public. The President later said he had been ‘misquoted’ and ‘quoted out of context.’
The other was the deepening rot involving the Perpetual Treasuries, the controversial bond dealer connected to the family of the former Central Bank Governor Arjuna Mahendran.
A leaked Central Bank draft report revealed that the primary dealer of which Arjun Aloysius, the son-in-law of the ex-central Bank Governor was a founding director had made a whopping after-taxprofit exceeding 10 billion rupees for the 14 months from April 2015 to May 2016.
That is also the period corresponding to Mr. Mahendran’s tenure at the Central Bank. During the same period, the cumulative after-tax profit of the rest of the bond traders in the market was just Rs. 544 million. This defies basic logic and one needs not to be an economist to feel something is fishy.
The Monetary Board of the Central
We live in an imperfect world among imperfect people in an imperfect time, in which too much idealism, at best, exploded as harmless windbags
Bank itself has expressed concern on ‘the sharp disparity in the performance of primary dealers, as well as certain issues related to the pattern of trading activities.’
Last week the court ordered the auctioning of a multi-million rupee house and land, allegedly belonged to former minister Basil Rajapaksa, of which ownership he had denied.
However, the Government’s response has been muted. There are two explanations.
The optimistic scenario is that the authorities are awaiting the final report of the Monetary Board. The monetary board in a media statement said the future course of action would be decided upon the completion of on-site-investigation reports.
However, the other disturbing prospect is that after all the hullabaloo , the politically connected would get away with a slap on their wrists to enjoy their ill- gotten wealth- while the poor are sent to jail for the theft of a coconut.
This is on-your-face crony capitalism. The UNP has a past record of it- though some of which were inevitable fallouts of the initial stage of capitalism, a malady seen in most later successful economies in South East and East Asia during their early days.
However, the same excuse cannot be peddled now.
That such abuses are revealed and investigated is a sign of change. But, since we have channelled our energies to deliberate on those abstract matters – secularism, devolution, constitutionalism -as we have been doing since the independence, and tend to think corruption ended with the former regime, real economic concerns risk being relegated. However a corrupt democracy is not the change the people voted for.
Yahapalanaya is also faced with another familiar dilemma that countries encountered in their democratic transition.
When the President spoke out last week about his discontent at certain actions undertaken by the Bribery Commission, he perhaps unintentionally, highlighted this predicament. Countries from Indonesia to Chile, which underwent democratic transition after protracted autocratic regimes did not choose to
The disturbing prospect is that after all the hullabaloo , the politically connected would get away with a slap on their wrists to enjoy their ill- gotten wealthwhile the poor is sent to jail for the theft of a coconut.
lock up the entire old guard, because, that was a recipe for disorder.
When the President , as the commanderin- chief raised concerns over the indictment of military commanders or the prolong detention in remand custody of military personnel, he is making a point for stability - and he echoes the concerns of many thousands of officers and other ranks- and a sizeable portion of the Sinhalese majority.
On the other hand, the Bribery Commission is acting on its constitutional mandate and with the good intentions of its activist staff. Their intentions are noble, however, Sri Lanka which ended a brutal war with means at its disposal, cannot behave like Sweden.
Our circumstances are different and we were not born yesterday. It takes years for the democratic transition to complete, and those who are overseeing the process should be mindful of potential drawbacks if they try to overdo certain things.
It would be wonderful if all the perpetrators be held accountable for their past crimes. That is what the rights groups, civil society activists, diplomats and many others are rooting for, though for different reasons, some of which are noble, some less so.
However, we live in an imperfect world among imperfect people in an imperfect time, in which too much idealism, at best, exploded as harmless windbags and, at worst , created killing fields and Gulags.
The Government should be cognizant of the past we try to leave behind, and in the process, not let it to haunt the present and the harm the prospects of the future. Instead, it should put more emphasis on the present. Dwelling too much in the past in order to appease some, would antagonize many others, who are numerically large. Perhaps, the president is making that point. Follow Rangajayasuriya @ Rangajayasuriya on Twitter