Malaysian Maverick: Mahathir Mohamad in Turbulent Times Read online

  Similarly, Abdullah transformed relations with Australia by ending almost overnight what one Australian correspondent called "two decades of bilateral cold war". The two countries agreed to annual consultations between their foreign ministries and senior officials, with Abdullah making the first official visit to Australia by a Malaysian prime minister in 20 years.

  In repairing contacts with the United States, Malaysia's largest trading partner and foreign investor, all Abdullah had to do, again, was substitute civil discourse for Dr. Mahathir's point-scoring on behalf of the developing and Islamic worlds. The Malaysians disagreed with Washington over the invasion of Iraq and some other issues, and that would not change regardless of who was in office in Kuala Lumpur. But pragmatic and interested in tangible returns, Abdullah travelled to America in mid-2004, met President George W. Bush and declared their ties "very strong".

  Concerned about competition from Thailand and Singapore, which were negotiating free-trade agreements with the United States, Abdullah signed up for one himself. Dr. Mahathir had displayed considerable wariness about such pacts, arguing that in an era of globalization they mainly benefited the powerful industrial economies. He criticized Singapore for entering a free-trade agreement with New Zealand because, he said, it weakened the Association of Southeast Asian Nations and might allow Australian and New Zealand products access to the ASEAN market by the back door. While Malaysia under Dr. Mahathir had begun discussions with China and Japan on free-trade arrangements, Abdullah accelerated the process and tried to make up for lost time. He widened the discussions to include Australia, New Zealand, Pakistan, India and Chile, as well as the United States.

  Keen to seek endorsement for his reformist programme before the end of the honeymoon period customarily extended to a new leader, Abdullah called a general election for 21 March 2004, less than five months after he became prime minister. Some of the gloss had begun to wear off when he re-appointed most of Dr. Mahathir's ministers to his Cabinet, a clear message that anti-corruption would not be pushed too far. And when it came to nominating UMNO candidates for the election, few of those commonly thought to be corrupt were excluded.[32]

  Still, built around Abdullah's amiable and pious personality, the National Front's campaign stressed the by-now familiar themes of Islam and corruption. The government went close to condemning the ancien regime by admitting in one full-page newspaper advertisement that Malaysia had become "rotten to the very core with no single aspect of life untouched by corruption".[33] The ads urged the electorate to give Abdullah a landslide so he could continue cleaning up the mess.

  Dr. Mahathir, who did not seek re-election, was seen on balance as a liability and given a limited role. He canvassed for votes in parts of Kedah, his home state, and mainly in constituencies where ethnic Chinese were in a majority. On UMNO's advice, he did not venture into Kelantan or Trengganu, PAS's strongholds, or other parts of the Malay heartland.[34] The one-time Malay champion was now more popular with non-Malays.

  While Abdullah eschewed the crude and offensive campaign tactics employed by the National Front in 1999, he had no hesitation in using the vast resources of the state, as usual, to overwhelm his opponents. He was aided by a redistribution of electoral boundaries that added 26 seats to Parliament in a way that would obviously favour UMNO while reorganizing some PAS-held seats to make it hard for the party to retain them. In addition to the gerrymandering, the Election Commission was responsible for a litany of errors in the conduct of the entire electoral process that could be explained only by a combination of gross incompetence and a desire to benefit the government.[35]

  Abdullah led the National Front to its greatest electoral win ever in terms of parliamentary seats, capturing 199 of the 219 on offer. The opposition won only 20 seats compared with 4S in the outgoing smaller Parliament. Although the National Front's 64 per cent of the vote trailed its 65 per cent previous best in 1995, it was up sharply from 56 per cent in 1999. The National Front regained control from PAS of the legislature in Trengganu state, where Abdullah was running the campaign, and went close to dethroning the party in Kelantan. PAS ended up with a mere 6 seats in Parliament, down from 27.

  An analysis showed that while UMNO had scarcely crushed PAS in the showdown for the Malay vote, the outcome was still a strong endorsement for UMNO and a personal triumph for Abdullah. Malays were prepared to give Abdullah a chance with his moderate brand of Islam and reform agenda. They still hoped he was sincere in his declarations to eliminate corruption.

  Where the country responded to Abdullah's promise of good governance, however, UMNO resisted, indicating it was out of touch with public opinion, or prepared to ignore it. At the UMNO General Assembly in September 2004, Abdullah dodged a ballot for the party's presidency only because Tengku Razaleigh Hamzah, the former finance minister who almost defeated Dr. Mahathir in 1987, could not persuade 30 per cent of divisions nationwide to nominate him as a challenger. Acting President Abdullah was confirmed in his post, as was Najib, his deputy, though Abdullah's failure to get key allies elected to top party positions made it less than a repeat of his general election success.

  In the ballot for the party's three vice presidents, the likely future leaders, incumbent Muhyiddin Yassin, an Abdullah supporter, narrowly retained his position. Another incumbent favoured by Abdullah, Muhammad Muhammad Taib, lost. Two relative outsiders, Federal Territories Minister Mohamed Isa Samad and Malacca Chief Minister Ali Rustam, finished first and second, respectively. Abdullah retained a majority on the Supreme Council, though only because he was allowed by the rules to appoint up to ten members himself. Four cabinet ministers lost their seats on the council, while three old-line, pro-Mahathir politicians made surprising comebacks.[36] As delegates were giving Abdullah a standing ovation for his ringing cries to cleanse UMNO of political corruption, some of them were accepting cash and other payments in return for their votes. "Money politics" was worse than ever, delegates suggested, and could help explain the surprising poll results. Their view was confirmed later by an internal investigation that led to Mohamed Isa Samad, the poll topper, being suspended from the party for bribery.

  With his huge electoral mandate, Abdullah persisted with policies that implicitly pictured Dr. Mahathir as irrational, irresponsible and profligate. Abdullah withdrew approval for a gambling concession that almost nobody knew had even been granted. The government said Dr. Mahathir, in his capacity as finance minister, had awarded the licence to Ascot Sports, a private company controlled by a tycoon who vied for the title of crony-in-chief, Vincent Tan Chee Yioun, not long before resigning. Dr. Mahathir denied that he was "personally responsible" for granting the licence.[37] It would have allowed Ascot Sports to conduct nation-wide off-site betting on local and international sports events for 20 years. The company paid a RM20 million fee for an operation that industry experts calculated would have generated annual turnover of RM1 billion from horse racing, soccer and other sports. While the government would have collected substantial revenue in taxes that was being lost to illegal gambling, Abdullah worried that the concession would expose the government to attacks by conservative Muslims, especially PAS, which had long campaigned to close existing gaming outlets.[38] Nobody explained why the public — and the Cabinet — had been kept in the dark about the original decision in 2003. Abdullah's aides said they learned about it only in 2004, when Tan informed them he was planning to start his new betting business.[39]

  A wounded and angry Dr. Mahathir conveyed his unhappiness to close friends. "Mahathir's disagreement with Abdullah started with his delaying tactics over [appointing] Najib," said Abdullah Ahmad, who kept in touch with the former premier. "Next was the release of Anwar. The rest followed."[40] When Abdullah Badawi encroached on core elements of Dr. Mahathir's vision — Proton, the national car; the construction of a bridge to Singapore; and Putrajaya, the new capital — the former prime minister exploded in public. He was an adviser to Proton Holdings Bhd., the publicly listed company producing the car, and
he used the post to go to the company's defence.

  Proton was already under siege as trade barriers fell in Southeast Asia and the company progressively lost the protection that had long made it profitable. It faced a further threat if Abdullah was serious about cleaning up the ponderous, government-linked concerns that dominated the country's business scene and equity market. The task fell to Khazanah Nasional Bhd., the state-owned investment agency that held a controlling stake in Proton, and in the nation's power, airline and telecommunications companies. What happened at Proton showed how deeply politics was embedded in business under Dr. Mahathir's philosophy, and how hard it would be to disentangle them.

  Contrary to Abdullah's assurance that Proton's board would have the final say in all management matters, Mahaleel Ariff, the Mahathir protégé who had been chief executive since 1997, began making decisions after consulting Dr. Mahathir alone. When the board decided not to renew Mahaleel's contract, Abdullah stepped in at Dr. Mahathir's request and overruled the board. Abu Hassan Kendut, Chairman of Proton, quit in protest. Later, the board successfully removed Mahaleel after he gave a newspaper interview and criticized the government for not providing enough protection for Proton.[41] Dr. Mahathir basically declared war on the government by defending Mahaleel and endorsing his criticism. He opened another can of worms by claiming "irregularities" in the opaque import-licensing system for foreign cars, by which, he said, the imports posed unfair competition for Proton.

  With Mahaleel out of the way, Proton proclaimed its independence at the end of 2005 by unloading a 57.7 per cent stake in the debt-ridden Italian motorcycle manufacturer MV Augusta Motors. Proton's new management largely blamed Augusta for a pre-tax loss of RM158.8 million for the three months to 30 September 2005, the second consecutive quarterly loss and a sharp reversal from the RM439.8 million pre-tax profit for the six-month period a year earlier. The disposal of Augusta was a monstrous rebuke for Dr. Mahathir and Mahaleel, who together had purchased the famed but struggling motorcycle designer and maker less than a year earlier. Proton paid 70 million euros for Augusta and sold it for a token one euro.

  In a joint statement, Dr. Mahathir and Mahaleel said their credibility and honesty were at stake. They questioned the rationale behind the sale and posed a series of questions that, they said, the company owed it to shareholders and the public to answer. In later comments, Dr. Mahathir took issue with Proton management's contention that Augusta did not have any synergy with the carmaker. Failing to elicit a response from Proton, Dr. Mahathir mocked Abdullah's new order: "I thought that this is supposed to be a very transparent world where everything is done in full view of everyone."

  If Abdullah had been reluctant to take tough decisions that would put him into direct conflict with Dr. Mahathir over Proton, he surely agonized over plans for a second bridge to link Malaysia with Singapore. But on this issue, there was no fudging their differences. The Malaysians had argued with the Singaporeans for a decade to share the cost of replacing the old causeway with a bridge so that ships could pass through the narrow Johore Strait, but Singapore saw no reason to scrap the causeway, and this item became entangled with all the others on their bilateral agenda. In an act of brinkmanship close to retirement, Dr. Mahathir authorized a construction company to begin work on Malaysia's half of the bridge. Abdullah initially told the company to go slow,[42] before cancelling the contract in April 2006, outraging Dr. Mahathir and causing an irreparable breach between them.

  To Abdullah, it made no sense to build a bridge to nowhere. Connecting it to the Singapore end of the causeway would invite legal action by Singapore, since it involved relocating water pipes and a train line, as well as demolishing half the causeway. Going ahead with half a bridge and hoping that one day it might be turned into a full bridge would subject Malaysia to ridicule and place it at Singapore's mercy. For Dr. Mahathir the nationalist, however, halting work was surrendering Malaysian sovereignty and kowtowing to the Singaporeans "as if you are scared of them". Dr. Mahathir pronounced Malaysia a "half-past six country", invoking a term whose origin was obscure but whose meaning he made crystal clear: a "country with no guts".[43]

  Similarly, Dr. Mahathir disagreed volubly with Abdullah for suspending construction of a monorail in Putrajaya in the name of fiscal responsibility. Dr. Mahathir had been prepared to press ahead with the new city even during the Asian economic crisis, and he rejected the argument that the state was currently short of funds. Convinced the train line should be financed off-budget, if necessary, he pointed to "record" profits earned by state oil and gas company Petronas, to the flush Employees Provident Fund and to accumulating national reserves, as evidence that money was available.

  Although Dr. Mahathir repeatedly had pledged not to interfere once he handed over, he justified his intervention on the grounds that Abdullah had broken their private, implicit agreement first. "Before I stepped down, we agreed that certain things needed to be completed, because this has been agreed upon," said Dr. Mahathir. "And he never said he would not. And then he reversed things that were decided, sometimes in the Cabinet."[44]

  Dr. Mahathir was too angry to contemplate the sweet ironies of political life, that what goes around comes around. Thirty years earlier, Tengku Razaleigh Hamzah's career had been derailed by a gentleman's agreement, an "understanding" with Dr. Mahathir that became a misunderstanding. Now it was Dr. Mahathir's turn. It was not so much a case of teaching an old dog new tricks, as an old dog forgetting his tricks as he aged.

  Dr. Mahathir took the view that while it was Abdullah's prerogative to add new elements, it was unacceptable for him to abandon a major policy or project already in place. "The style may change, but what was undertaken before should be carried out," he said.[45] For his part, Abdullah said it was "unrealistic to assume that I would let everything run on autopilot after becoming prime minister". Apart from challenges that keep changing, "there are also things that I wanted to implement for the country which may not have been a priority when he was prime minister", Abdullah said. Fortified by his huge election victory, "I think I have the people's approval to lead in the manner I believe will best benefit the country".[46]

  The Dr. Mahathir confronting Abdullah was vastly different from the master politician the country had known for almost a quarter of a century. Apart from being an adviser to four government-linked concerns — Petronas, the Langkawi Development Authority and the Tioman Island Development Authority, as well as Proton — Dr. Mahathir lacked a power base and was 78 when he retired. His inability to acknowledge the nature of political power, that it flowed from the office and not the individual, was not a little sad considering how effortlessly he had once wielded power. Throughout his political life, he had been obsessed with perpetuating his own power, telling Hong Kong-based Asiaweek in 1997, "If you don't have power and you put out a very reasonable proposal, nobody will implement it. You have to have power."[47] Now, he was unable or unwilling to accept that power had passed to someone else. Dr. Mahathir was particularly hurt that his former cabinet members had switched their allegiance to Abdullah and endorsed alternative ideas, predictable in many a political system and completely consistent with Malay culture. "I thought they supported me because of what I was doing for the country," he said. "Now I know they supported me because I was prime minister." After complaining about being stabbed in the back, he said of Abdullah, "I chose him and I expected a degree of gratefulness."

  In one crucial respect, though, it was the same old Dr. Mahathir: His way was still the only way. As he said, he had risked his neck in 1969 to point out that Prime Minister Tunku Abdul Rahman was "definitely doing something wrong", and it was disappointing that nobody in UMNO now was prepared to take a risk and speak out against practices that were "obviously wrong".[48] Even as a "pensioner", as the Sultan of Johore scorned him, Dr. Mahathir assumed that he should be the sole judge of what was wrong for Malaysia. Musa Hitam, the first of the deputies, joked that Dr. Mahathir was suffering from PMS — "post-prime ministerial
syndrome" — causing him to think that "only he is right".[49]

  In his sustained, frontal attack on Abdullah, Dr. Mahathir implicitly invited further examination of his own record, "to bring the magnifying glass to the collateral damage of his economic policies during his years in office", as academic Shamsul Amri Baharuddin said.[50] Or, as Karpal Singh, the opposition warhorse, put it, "I say those who live in glasshouses should not undress without drawing the curtains."[51] As always, Dr. Mahathir was fearless. No topic was taboo, despite its potential to rebound on him, and he was offended by repeated allegations "that the administration during my time was worse".[52] Dr. Mahathir's conviction and certitude were intact, but without the levers of state and party power to impose his views, his words echoed impotently.

  The architect of Malaysia's mega-projects and duty supervisor for several world-class financial scandals dared accuse the budget-conscious Abdullah administration of wastage. The government's decision not to go ahead with half a bridge to Singapore had caused losses amounting to billions, Dr. Mahathir said. "This is the people's money."[53] He also portrayed the disturbing crime rate as part of the rot that had set in under Abdullah, a claim disproved by the royal commission into the police force, which found it was the most corrupt of all government departments and long incapable of protecting the public.[54]