Malaysian living standards declining?

MOST Malaysians who joined the ranks of the employed in the 1970’s can look back and say that they were better off than those doing so now.

Ever since the 1970’s, the increase in salaries in general has lagged behind rising prices of goods and services across the board.

Take the case of a fresh university graduate who joins the public sector. Back in the 1970’s he would be drawing a basic salary of RM750 per month whether he was a doctor, an administrator or an engineer.

The RM750 may look paltry today but back then the sum was enough to cover almost all living expenses plus some balance for savings for the future.

Today, a fresh university graduate who joins the public sector receives a basic salary of about RM2,400 (a three-fold rise over the 1970’s) but he has to spend frugally in order not to be in debt.

The purchase price of a 24ft x 75ft double-storey terrace house, say in Petaling Jaya, was only RM40,000 back in the 1970’s. Today, the purchase price of a similar type of house in a similar location is around RM800,000 (a 20-fold rise).

A 1,200cc Japanese car back then was priced at RM7,000. Today, a 1,200cc local car is priced at RM50,000 (a seven-fold increase) while an imported Japanese version is priced at RM70,000 or even RM80,000 (more than a 10-fold rise).

A plate of economy rice with four dishes back then cost only 60 sen. Today, a plate of economy rice is not so economical costing at least RM6 (a 10-fold jump in price).

A bowl of wantan mee or prawn mee cost only 30 sen back then. Today, a similar bowl costs at least RM3 (a 10-fold rise).

A long-sleeved shirt back then could be bought for only RM5 (locally-made) or RM9 (foreign brand).

Today, a locally-made similar shirt costs RM60 or even RM70 while a foreign branded shirt is well over RM100.

The purchasing power of today’s ringgit has depreciated about 10 times compared to that of the 1970’s.

This effect of a faster rise in prices over the rise the salaries has led to a decline in the living standards of Malaysians in general over time.

This in turn has resulted in a shrinking middle income group and an expanding low income group in Malaysia.

In the 1970’s, a fresh graduate who was employed could be classified as a member of the middle income group.

Today, an employed fresh graduate belongs to the low income group.

Small wonder many people today resort to borrowing for consumption to live through the day.

Credit card companies or even Ah Long have no shortage of clients. The national consumption debt, both public and private, is rising at an alarming rate.

The BR1M1 and BR1M2 are only quick fixes for temporary relief.

In the long run, efforts to generate a sustained increase in productivity are the only viable solutions to address the problems of price of goods rising faster than salaries.

These include downsizing the public sector, reducing corruption, adopting desired policies like meritocracy, raising educational and training standards, and so on.

OLD TIMER Penang The Star/Asia News Network

Japan right-wing party scores landslide election win

Hawkish Shinzo Abe to return as prime minister, vowing tough stance on China

 

Japan's Yoshihiko Noda,the leader of the losing Democratic Party of Japan, told voters: 'I apologize deeply for our failure to achieve results.' (Issei Kato/Reuters

Japan's Liberal Democratic Party ( LDP) won by a landslide in Sunday's House of Representatives election as it solo secured 294 seats in the election.

The LDP's key ally, the New Komeito Party, got 31 seats, helping the two-party coalition gain 325 seats in the lower house.

The Liberal Democratic Party's (LDP) leader Shinzo Abe served as Prime Minister from 2006 to 2007. (Yuriko Nakao/Reuters)Japan's conservative Liberal Democratic Party returned to power in a landslide election victory Sunday after three years in opposition, exit polls showed, signalling a rightward shift in the government that could further heighten tensions with rival China.

The victory means that the hawkish former Prime Minister Shinzo Abe will get a second chance to lead the nation after a one-year stint in 2006-2007. He would be Japan's seventh prime minister in six-and-a-half years.

Public broadcaster NHK's exit polls projected that the LDP, which ruled Japan for most of the post-World War II era until it was dumped in 2009, won between 275 and 300 seats in the 480-seat lower house of parliament. Official results were not expected until Monday morning. Before the election, it had 118 seats.

The results were a sharp rebuke for Prime Minister Yoshihiko Noda's ruling Democratic Party of Japan, reflecting widespread unhappiness for its failure to keep campaign promises and get the stagnant economy going during its three years in power.

With Japan stuck in a two-decade slump and receding behind China as the region's most important economic player, voters appeared ready to turn back to the LDP.

A serious-looking Abe characterized the win as more of a protest vote against the DPJ than a strong endorsement of his party.

"I think the results do not mean we have regained the public's trust 100 per cent. Rather, they reflect 'no votes' to the DPJ's politics that stalled everything the past three years," he told NHK. "Now we are facing the test of how we can live up to the public's expectations, and we have to answer that question."

The ruling Democrats, which won in a landslide three years ago amid high hopes for change, captured less than 100 seats, exit polls indicated, down sharply from its pre-election strength of 230.

Calling the results "severe," Noda told a late-night news conference he was stepping down to take responsibility for the defeat.

'It was the voters' judgment to our failure to live up to their expectations.'—Prime Minister Yoshihiko Noda on his party's loss

"I apologize deeply for our failure to achieve results," he said. "It was the voters' judgment to our failure to live up to their expectations during our three years and three months of leadership."

The LDP will stick with its long-time partner New Komeito, backed by a large Buddhist organization, to form a coalition government, party officials said. Together, they will probably control about 320 seats, NHK projected — a two-thirds majority that would make it easier for the government to pass legislation.

Noda said a special parliamentary session would be held before year-end to pick a new prime minister. As leader of the biggest party in the lower house, Abe will almost certainly assume that post.

The new government will need to quickly deliver results ahead of upper house elections in the summer. To revive Japan's struggling economy, Abe will likely push for increased public works spending and lobby for stronger moves by the central bank to break Japan out of its deflationary trap.

'Restore some national pride'

Still, some voters said they supported the LDP's vows to build a stronger, more assertive country to answer increasing pressure from China and threats of North Korean rocket launches. Abe has repeatedly said he will protect Japan's "territory and beautiful seas" amid a territorial dispute with China over some uninhabited islands in the East China Sea.
 
The nationalistic, populist Japan Restoration Party is also expected to capture a few seats and perhaps, form a coalition with the new ruling party. (Yuriko Nakao/Reuters)

 "
I feel like the LDP will protect Japan and restore some national pride," Momoko Mihara, 31, said after voting for the Liberal Democrats in the western Tokyo suburb of Fuchu. "I hope Mr. Abe will stand tall."

The LDP may also have benefited from voter confusion over the dizzying array of more than 12 parties.

One of the new parties, the right-leaning, populist Japan Restoration Party, won between 40 to 61 seats, NHK projected. The party, led by the bombastic nationalist ex-Tokyo Gov. Shintaro Ishihara and Osaka Mayor Toru Hashimoto — both of whom are polarizing figures with forceful leadership styles — could become a future coalition partner for the LDP, analysts said.

Ishihara was the one who stirred up the latest dispute with China over the islands when he proposed that the Tokyo government buy them from their private Japanese owners and develop them.

In this first election since the March 11, 2011, earthquake, tsunami and nuclear disasters, atomic energy ended up not being a major election issue even though polls show about 80 per cent of Japanese want to phase out nuclear power.

'We're not like Germany'

In the end, economic concerns won out, said Kazuhisa Kawakami at Meiji Gakuin University.

'The economy has been in dire straits these past three years, and it must be the top priority.'—Shinzo Abe

"We need to prioritize the economy, especially since we are an island nation," he said. "We're not like Germany. We can't just get energy from other countries in a pinch."

The staunchly anti-nuclear Tomorrow Party — which was formed just three weeks ago —captured between six and 15 seats, NHK estimated.

Abe's Political History

During his previous tenure as prime minister, Abe pursued a nationalistic agenda pressing for more patriotic education and upgrading the defence agency to ministry status.

He also insisted there was no proof Japan's military had coerced Chinese, Korean and other women into prostitution in military brothels during Japan's wartime aggression in Asia. He later apologized but lately has suggested that a landmark 1993 apology for sex slavery needs revising.

Abe has said he regrets not visiting Yasukuni Shrine, which enshrines Japan's war dead, including Class-A war criminals, during his term as prime minister. China and South Korea oppose such visits, saying they reflect Japan's reluctance to fully atone for its wartime atrocities.

Tomorrow Party head Yukiko Kada said she was very disappointed to see LDP, the original promoter of the nuclear energy policy — and still the most pro-nuclear party — making a big comeback.

Abe, 58, is considered one of the more conservative figures in the increasingly conservative LDP.

It remains to be seen how he will behave this time around, though he is talking tough toward China, and the LDP platform calls developing fisheries and setting up a permanent outpost in the disputed islands, called Senkakus by Japan and Daioyu by China — a move that would infuriate Beijing.

The LDP wants to revise Japan's pacifist constitution to strengthen its Self-Defence Forces and, breaching a postwar taboo, designate them as a "military." It also proposes increasing Japan's defence budget.

It's not clear, however, how strongly the LDP will push such proposals.

"The economy has been in dire straits these past three years, and it must be the top priority," Abe said in a televised interview. "We must strengthen our alliance with the U.S. and also improve relations with China, with a strong determination that is no change in the fact the Senkaku islands are our territory." - CBCnews

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China Dream a nightmare for others?

New Communist Party chief Xi Jinping’s ‘China Dream’ speech raises concern among foreign countries, especially those locked in territorial disputes with China, such as Japan, Vietnam and the Philippines.

THE “China Dream” is a phrase that has appeared in plays and books, but it recently got an airing at the topmost echelon of power when new Communist Party chief Xi Jinping used it to rally the nation.

Making his second speech since taking over as China’s top leader last month, Xi outlined what he deemed the greatest dream for China: realising the revival of the Chinese nation.

He said: “Everyone is talking about a China Dream. I believe the revival of the Chinese nation is the greatest dream of the nation since modern times. We are at the closest point to the Chinese nation’s resurgence than any time in modern history... and I am sure we will accomplish our goal.”

Xi’s choice of words has sparked a new craze over the phrase China Dream, with netizens rendering their own definitions of “zhongguo meng”, such as a corruption-free country.

Many believe the new leader was trying to mobilise domestic support for his agenda of continuing reform and opening up, by inspiring people towards a China Dream – the title of a 1987 play about a Chinese couple dreaming of success in the United States.

“It also serves to galvanise the people’s support and rally the public around the new administration’s economic and political agenda,” said Professor Wang Dong, an international studies expert at Peking University.

But a closer analysis of Xi’s speech makes one wonder if there is cause for concern for foreign countries, especially those locked in territorial disputes with China, such as Japan, Vietnam and the Philippines.

First, he chose to make the speech at the National Museum, where he and six other members of the apex Politburo Standing Committee had viewed the iconic China’s Road To Renaissance exhibition late last month.

Visitors tend to spend at least two hours at the exhibition, which begins with narratives of China as a weak country that suffered humiliating defeats and the loss of sovereign territories to foreign powers around the early 1900s.

It then traces the country’s efforts to rise from the ashes, which gained speed after the reforms and opening up under late leader Deng Xiaoping in 1980s.

Given the symbolic setting, the natural fear is that part of Xi’s China Dream may include taking a tougher stance towards foreign countries that China perceives to be threatening again to grab its territories.

There were hints in his speech when he said: “Looking back at our past, we can see that if we are lagging behind, we will suffer beatings. Only when we advance, then can we be strong.”

Also, the phrase “China Dream” evokes memories of a 2010 book by a People’s Liberation Army officer, which advocated a speedy strengthening of China’s military might or risk being sidelined by the US.

In his Chinese-language book, The China Dream, Senior Colonel Liu Mingfu wrote that “as long as China seeks to rise to become world No. 1... then even if China is more capitalist than the US, the US will still be determined to contain it”.

“If China in the 21st century cannot become world No. 1, cannot become the top power, then inevitably, it will become a straggler that is cast aside,” added Col Liu, who is a professor at the National Defence University.

If Xi was indirectly backing Col Liu’s beliefs, it could hint at more aggressive moves by Beijing in dealing with foreign countries in future.

For some, it may have already happened. On the day Xi sketched his idea of the greatest dream for China, news broke that police in southern Hainan province would get new powers to intercept foreign ships in the contested South China Sea.

Though it is unclear whether the new rules taking effect next month would be limited to only Hainan island’s territorial waters within 12 nautical miles, the move has given some of its neighbours sleepless nights.

It has also unnerved non-claimant countries such as Singapore, which places great value on regional peace and freedom of navigation.

To be fair, China is not the only claimant state stirring up the waters in the maritime hub lately. Others have taken similar actions.

Also, to be sure, some believe that Xi’s China Dream pertains mostly to improving the people’s lives through better jobs and better rule of law.

In that sense, it does not differ much in essence from the American Dream, which promises equal and fair opportunities for all, in pursuit of a better life. Or the Singapore dream, which epitomises the prospects of a successful life gained through hard work.

But niggling concerns remain, given that China’s new commander-in-chief could fan or yield to more nationalistic sentiments by taking a more hawkish foreign policy stance, particularly if domestic political problems persist.

Said Professor Taylor Fravel, a China expert at the Massachusetts Institute of Technology: “Xi’s speech suggests that he may be more willing to invoke nationalism, but at this point it is too soon to tell how this will affect China’s foreign policies.”

After decades of promising a peaceful rise, it would be a shame if Beijing starts to grow its might at an unhealthy pace or flex it aggressively, which could worsen already frayed ties with its neighbours and destabilise the region.

While China and its people are entitled to pursuing their dream after decades of setbacks, it is also in the country’s interest to continue to act like a responsible global power by showing sensitivity to others in the region.

A dream for China should not become a nightmare for the rest of the world.

By Kor Kian Beng, China Correspondent  The Straits Times/Asia News Network