Hypocrisy Meter from theblogprof.
From The Star 3 April 2009:
Dr M: Don’t bail out failed banks
LONDON: Tun Dr Mahathir Mohamad has called for the closure of banks that caused the global financial crisis instead of bailing them out.
The former prime minister lambasted the West for pumping in billions of dollars to resuscitate these “failed institutions”.
He said they should be allowed to go under as bankers were rewarding themselves with fat bonuses rather than be punished for their inefficiencies.
“Let’s start new banks. We don’t need to have banks with those names anymore as they are a disgrace,” he said in his talk ‘The Alternative G20 Agenda: Real Financial Fairness’ at the Royal Commonwealth Society here on Wednesday.
More than 200 people attended the event on the eve of the G20 summit.
In his usual hard-hitting style, Dr Mahathir said there should be no attempt by governments to rebuild institutions which have failed.
“If they must dole out money, give it to the people who suffered actual losses due to the banks’ failure, but not to the bankers,” he said.
He questioned the logic of rewarding bankers who caused the economic crisis, saying those who created trouble were normally put in prison.
Dr Mahathir also took a dig at hedge funds, saying their borrowings should be limited and not be 20 or 30 times more than the investments.
“Imagine if a hedge fund were to borrow US$30mil and trades on US$20mil based on a US$1mil investment, the profits would be far bigger than that of the original investment,” he said.
He said a stop should be put in creating money out of nothing, adding everyone must come clean instead of obtaining false wealth through shuffling papers. “Most of the wealth comes from playing around with money. You can sell currencies and make tons of money,” he said, adding they were not derived solely from producing goods and services anymore.
He called for a review of the international monetary, financial and banking system which had suffered a systematic collapse due to gross abuses.
Dr Mahathir said the global community could elect people to represent the differing economies and work together in curbing financial abuses.
“If we’re going to be fair – real financial fairness – we should give everybody a say in the formulation of a new banking, financial and monetary system.”
This, from the man who bailed out his pet projects and failing institutions like MAS, Bank Bumiputra, Konsortium Perkapalan Bhd (KPB), and PROTON!!!
Malaysia’s fox takes charge of the henhouse
By Anil Netto
Since the early 1980s, Petronas has never been far from controversy or criticism, especially in its involvement in high profile bailouts of the debt-ridden and political connected Bank Bumiputra, now merged into Bumiputra Commerce. For a long spell, Bank Bumiputra was kept afloat with huge injections of Petronas funds.
One of the biggest outcries came in 1998, when cash-rich Petronas announced what analysts felt amounted to a bailout of Mahathir’s son Mirzan. Back then, Mirzan’s main public listed company, shipping concern Konsortium Perkapalan Bhd (KPB), was floundering, with debts estimated at about RM1.7 billion. Its share price had fallen to RM3.78 by February 1998, a fraction of its pre-financial crisis level of RM17 plus.
The Petronas-controlled national shipping carrier Malaysian International Shipping Corp Bhd (MISC) stepped in to bail out KPB for cash, mainly by acquiring debt-laden KPB’s shipping assets.
Under Mahathir’s tenure, Petronas also financed the then tallest buildings in the world, the Petronas Twin Towers, much to the consternation of critics who felt the money could have been better used. It was completed in 1998, just in time for the 1998 financial meltdown, at a cost of some RM1.8 billion.
Petronas is also heavily involved in the multibillion-ringgit development of the new – and extravagant – administrative capital, Putrajaya, with its artificial lakes and bridges and imposing monuments. It is one of the shareholders of Putrajaya Holdings Sdn Bhd, the main developer for Putrajaya. Apart from the concessions for government complexes/buildings and the residential and commercial development projects in Putrajaya, Putrajaya Holdings is also responsible for “the development of infrastructure, and landmark projects such as the Dataran Putra (Putra Square), Putra Mosque, Putra Bridge, the Putrajaya Lake and the Wetlands”.
In March 2000, Petronas again hit the headlines when it sealed a deal to buy 27.2 percent of national car maker Perusahaan Otomobil Nasional Bhd, or Proton, for about RM1 billion (US$264 million), making it the controlling shareholder. The stake was held by the DRB-Hicom Group Bhd, which was deeply in debt. The deal was announced after Proton, one of Mahathir’s pet projects, reported a net loss of RM19 million in the nine months to December 31, 1999.
Petronas was also used to secure the title sponsorship rights for the Malaysian Formula 1 Grand Prix and to sponsor the Sauber Petronas racing team. These were projects that Mahathir cherished as an attempt to market Malaysia around the world – while critics dubbed them wasteful.
Above are #11 and #12 from Malaysian Politics Motivational Posters
This is also the same ‘role model’ who would welcome a return to the non-freedom of speech of his era, where you can’t raise valid questions but he can say Jews cause trouble so they can rule the world.
This letter sheds some light on his reasons for starting mega-projects and bailing them out when they fail.
Home Ministry virtually encouraging tragedy to happen
I refer to your article How the Govt’ looted ‘ US$100 billion.
And looking back at Dr Mahathir Mohamad’s 22 years of tenure at the helm of the nation, it is not difficult to comprehend why we lost so much money through looting by his family and his cronies.
His favourite moneymaking trick was to launch mega-projects and privatisation of government companies. His many mega-projects were fronts to dish out negotiated tenders to his children and cronies whereby sweet deals were quoted with price many times its actual value.
The more projects he launched and the more expensive the projects, the higher and better the profits which were accrued by the beneficiaries. And when his son’s venture in the shipping business failed, he unhesitatingly used a government vehicle – the Malaysian International Shiping Corporation (MISC) – to bail his son out.
Bank Bumiputra which was a government-owned bank gave millions of unsecured loans to Mahathir’s cronies and in the end all of them ended up as non-performing loans (NPL). In the end Petronas’ oil money was used to bail out the bank. Similar bail-outs were later repeated for MAS, Bank Rakyat, Perwaja Steel and countless other GLCs.
His lack of business acumen saw the country lose heavily when he tried to corner the world tin market. It was conservatively estimated that his brief foray in the speculation on the tin market cost the nation a loss of RM20 billion.
And other past hypocrisies:
- Condemning South Africa’s apartheid while his own policies promote similar race-based privileges/discrimination back home
- Blasting Guantanamo and Abu Ghraib while himself arresting hundreds without trial under the Internal Security Act
Cukupah drama anda, Dr M!