AS if the recent revelations of the Perikatan Nasional government’s incompetence in garnering investors’ confidence was insufficient in denting Malaysia’s economic prospects, the state of emergency has dealt another paralysing – if not fatal – blow to our economy.
Businesses of all sizes – apart from a very limited few outliers – are barely surviving or have had to call it quits.
This is on top of the yet to be healed financial shortfalls from the first round of MCO. Not to mention a significant number of businesses who have yet to receive the promised financial assistance despite qualification.
For those businesses that are surviving, many are reluctant to expand on their workforce even if they are doing fine. By and large, retrenchments and workforce shrinkages are rules rather than exceptions. Meaning hereafter, at best, there will be stagnation of existing jobs and pay.
At worst outright job losses are very much on the cards. It's a downhill slope ahead on the jobs and business front, in view of the reinstated MCOs in several states, even without an emergency declaration.
With the sweeping emergency powers obtained by Muhyiddin and the government to commandeer assets, properties, resources and workforces, as well as levy charges without a slither of democratic oversight, there will unlikely be any new foreign or local investments in near sight.
To add salt to the wound, the emergency ordinance denies anyone in Malaysia any recourse to judicial reviews if the government chooses to exercise their powers tyranically and despotically.
It wouldn’t be surprising if we start seeing divestment and businesses cutting losses. Again, this will mean lesser jobs, and lesser spending power.
All in all, not only will the autocratically imposed “political stability” the government has afforded itself not going to help the economy, it’s only going to make it worse apart by speeding up its recession and shrinkage.
Less jobs means less consumption. Less people buying things. This means businesses not expanding and not hiring.
Which means less job creation, which in turn means less consumption. The vicious cycle continues. And along the way, it also means less taxes, and ultimately the government’s ability to provide social assistance will also be limited.
The only ones who are unaffected by this emergency are those who wield political power, and those who have strong financial holding power.
The former will be able to leverage their privileged knowledge to their advantage or even mould the conditions to suit their needs.
The latter will be able to buy assets and businesses at a low price at this or further junctures of the market's desperation.
When there are fewer and fewer jobs, even higher paid jobs, wages will be pressed down by the dynamics of a shrunken economy, where the supply of workers is much larger than the demand.
One of the sure fire outcomes of this emergency is that it will certainly widen inequality, which in turn will reverse whatever social cohesion we may already enjoy.
Of course, we need not hope for economic growth either as no one with sense would invest when there is no real political or social stability.
The rich and the powerful are poised to become more so, faster and easier than ever before; and the fates of the middling and working class will now enter a downward spiral unless this emergency is reversed.
Children and the vast majority of ordinary Malaysians – those who are neither rich nor powerful, will suffer.
Contrary to the bands of self-serving, whitewashing obsequious propaganda put out by Muhyiddin’s army of cybertroopers, this emergency will not serve Malaysians one single bit of good.
Howard Lee is DAP Socialist Youth National Chief
