Recently a video surfaced on whatsapp stating that the RCI on Dr. Mahathir's Govt losses during the Forex debacle found out that it was close to RM32 Billion and that no minister was aware of it!
"Face Palm"
Apake Haram Jadah punya menteri dan kepimpinan ini?
Ini kah dia pucuk pimpinan yang kita asyik mengundi untuk menjaga kepentingan negara selama 60 tahun ini?
Anyways, that is not the salient point I want to write about today.
I more prefer to look at this debacle in terms of LOST OPPORTUNITIES and COST.
I became curious about Malaysians spending power between 1970s and 2000s. Now for the caveat: all details given below are observational and anecdotal as they consist of my experince and memory as I look back into my past.
The first difference I see between then and now was that Families (indian Chinese,Malay & dll) used to have large families. Almost every married couple in the 70s to the 80s had 4 or more children.
"Face Palm"
Apake Haram Jadah punya menteri dan kepimpinan ini?
Ini kah dia pucuk pimpinan yang kita asyik mengundi untuk menjaga kepentingan negara selama 60 tahun ini?
Anyways, that is not the salient point I want to write about today.
I more prefer to look at this debacle in terms of LOST OPPORTUNITIES and COST.
I became curious about Malaysians spending power between 1970s and 2000s. Now for the caveat: all details given below are observational and anecdotal as they consist of my experince and memory as I look back into my past.
The first difference I see between then and now was that Families (indian Chinese,Malay & dll) used to have large families. Almost every married couple in the 70s to the 80s had 4 or more children.
Many middle income men of all races also had more than 1 wife or Family.
( Most of these on the side/ quietly).
Seniors today should be able to testify on that Truth.
After the 80s, something changed. Life become more difficult for that generation of income earners and proportionately more incidences of single mother families started to appear....especially in the lower strata of society and especially to the Indians who were living in the flats and rumah setinggan.
After the 80s, something changed. Life become more difficult for that generation of income earners and proportionately more incidences of single mother families started to appear....especially in the lower strata of society and especially to the Indians who were living in the flats and rumah setinggan.
Cases of 2nd and 3rd wife families still were around but no longer rampant as previously.
There were also a sudden influx around this time in cities of Hardcore poor citizens mainly Indians from the estates.
It became economically harder to maintain larger families, especially with stagnating income levels. Job market itself was changing as computers were starting to be implemented at the work place in the late 90s replacing the older clerically based/ trained work force
.
(This itself opens up to a host of LOST OPPORTUNITY level indications on matter of Security, Health and Educational aspects of these communities children and dependents)
Now, looking at income disparity is one way to assess on the situations referred above but there is also spending or consumption to give a more detail observation on WHAT people spent their income on.
The obvious ones that come to my mind were :
1. Clothing and Fashion which includes shoes, hand bags, Luggage bags etc.
I see more hand me downs being considered the norm today ...on the other hand within certain communities their middle class spending has deteriorated by half which explains why more BUNDLE clothing outlets and pasar malam style tents are opened in sub urban localities.
Also, it was once the norm for the professional class to have Tailor Made clothes and Suits. Those in their 60s and 70s today will recall those times.... Today, however the norm is to buy ready made suits and clothes at either Padini or Masters. During promotional seasons those off season clothing and styles can be bought as cheap as RM 150.oo per blazer. (And thats another thing: very few today know the difference between a Blazer, a Suit Jacket, a sports coat/ blazer and a smoking jacket.)
There were also a sudden influx around this time in cities of Hardcore poor citizens mainly Indians from the estates.
It became economically harder to maintain larger families, especially with stagnating income levels. Job market itself was changing as computers were starting to be implemented at the work place in the late 90s replacing the older clerically based/ trained work force
.
(This itself opens up to a host of LOST OPPORTUNITY level indications on matter of Security, Health and Educational aspects of these communities children and dependents)
Now, looking at income disparity is one way to assess on the situations referred above but there is also spending or consumption to give a more detail observation on WHAT people spent their income on.
The obvious ones that come to my mind were :
1. Clothing and Fashion which includes shoes, hand bags, Luggage bags etc.
I see more hand me downs being considered the norm today ...on the other hand within certain communities their middle class spending has deteriorated by half which explains why more BUNDLE clothing outlets and pasar malam style tents are opened in sub urban localities.
Also, it was once the norm for the professional class to have Tailor Made clothes and Suits. Those in their 60s and 70s today will recall those times.... Today, however the norm is to buy ready made suits and clothes at either Padini or Masters. During promotional seasons those off season clothing and styles can be bought as cheap as RM 150.oo per blazer. (And thats another thing: very few today know the difference between a Blazer, a Suit Jacket, a sports coat/ blazer and a smoking jacket.)
Dont even talk about the various ways a Tie can be tied- ( though windsors' & half nelsons are still evident today) but I shall digress.....
So, except for the ultra Luxurious Brand names- on the norm the middle class have reduced their consumption on clothing which can be seen in the year end Financial results of the Retailers ie Jusco, Tesco,etc (which has evidently played a large part in how they showcase their Soft lines and Hard line & Consummables these days)
2. Food which includes
Pet food as it used to be that many households had pets... once.
Baby Food which today need to be safeguarded by supermarkets because of its cost.
Liquor which has grown by 400% since the 60s
Cigarettes which has also increased exponentially (which I believe is why the scourge of any society (ie Drugs) cannot be eradicated even after billions spent to eradicate it since the 70s, simply because its still in demand by society- people need escapism in times of hardship or boringness in their daily lives)
3. Electronics, Appliances and Gadgets
I believe more secondary markets for these above mentioned goods have opened up in the last 10 years as evident by the stalls in Mydin ,Tesco and Jusco and other Supermarkets. Also, these items constitute a large percentage of Internet traffic in sites like Lelong and Low Yat.
Secondly, a larger percentage of bankrupcies these days are due to credit card purchases and Guarantor incidences....which when tracked back, can be seen were over modern gadger and appliances purchases. Cases written in Star,Metro newspaper and other English& Malay dailies indicate that places that give easy credit for household Appliances were the predominant users of Collection Agencies services, apart from (motorbike, cars) Banks and Mortagage recalls.
4. Transportation which includes personal cars and motor bikes
This is obvious.... due to a lack of public transportation, the average income earner has no choice other than to buy motorbikes or Cars to get to work. Unfortunately, the cost of wages and Wage itself has not kept with the Times and Inflation. Thus our country lost a substancial portion of national Labor through these policies.
However, i like to note that up to the late 90s, single mothers and the average senior citizen and students (which up till then,had contributed substancially to the labor intensive industries)still had a good transportation back up plan in the small towns and cities because of the availability of Taxis which only cost something like 60cents from Klebang Besar to Jalan Hang Tuah.(my personal experience). Also, many Kampungs and Tamans had their own support system of taxis plying the routes with confirmed workers going for their Shift work -mainly sharing one taxi per route. The trip from Johor causeway to Melaka Bus Station in the late 90s was still only RM18.00 per customer through the local taxi system back then.
It is my belief that the loss of Public Transportation and the secondary Taxi market had reduced the worker influx we so needed because these low wage workers were the backbone of our SMI & SME industries, just couldn't afford the stress and pay the transport costs to go to work anymore.
5. Mortgage
Previously in the 60s and 70s a house costs under RM 10,000/- . Today, in big cities (or even Melaka) it averages RM380.000/- So, how does a young worker afford a roof over his head? PRIMA is a good solution but is it offered in the same manner in all Malaysian States? Melaka is lucky it has many more options for the low income earner although the social sites like Sayangi Melaka, Saya Anak Melaka and such reader inputs tells of a different story (for some).
But the headline here is on Mortgage...and as such for a new house under these new rates means income has to be raised through other means/ wife/parents have to contribute. (which reduces savings capacity for emergencies-but that's a different story)
6. Health/ Medical Insurance
The average middle class family man has no longer the option to buy medical insurance as the premiums cut into his household budget. Most survive the hard times by relying on medical cards or Employer Group cover...whichever is a cheaper option.
It is very absurd that private Medical services for certain deadly Health issues (heart congestion, Muscular dystrophy etc) can be billed as high as a low wage earners 3 year total income (RM 40,000++) or that senior citizens need to pay a minimum of RM 500/= to the private optometrist shop for corrective lens which government hospitals dont cover and this is something 85% of old people will need.
Things are so bad that General Hospitals staff are breaking their back to provide good medical care and service and facilities are bursting at the seams. Today, GH's are known to place sick patients in their corridors for lack of space as many citizens no longer can afford private medical care.
7. Child Care and Kindergarten
This was not an expenditure item in the late 70s because mother and grandparents were not out working for a living. Children were looked after normally by the elders in the family living together. Good food was available because mother was home to cook and take care of the house.
That is not the case today. Today it is not wrong to state that child care and kindergarten rates can go as high as 1/3 of the income earners wages...whatever their earning power. If you include the rates for hiring & keeping a Maid then thats a different level altogether.
8. Taxes
Very obviously it is High as we now pay Income Tax, Company Tax and Goods and Services Tax on top of Excise tax on cars and Hard Liquor/Cigarettes.
So, except for the ultra Luxurious Brand names- on the norm the middle class have reduced their consumption on clothing which can be seen in the year end Financial results of the Retailers ie Jusco, Tesco,etc (which has evidently played a large part in how they showcase their Soft lines and Hard line & Consummables these days)
2. Food which includes
Pet food as it used to be that many households had pets... once.
Baby Food which today need to be safeguarded by supermarkets because of its cost.
Liquor which has grown by 400% since the 60s
Cigarettes which has also increased exponentially (which I believe is why the scourge of any society (ie Drugs) cannot be eradicated even after billions spent to eradicate it since the 70s, simply because its still in demand by society- people need escapism in times of hardship or boringness in their daily lives)
3. Electronics, Appliances and Gadgets
I believe more secondary markets for these above mentioned goods have opened up in the last 10 years as evident by the stalls in Mydin ,Tesco and Jusco and other Supermarkets. Also, these items constitute a large percentage of Internet traffic in sites like Lelong and Low Yat.
Secondly, a larger percentage of bankrupcies these days are due to credit card purchases and Guarantor incidences....which when tracked back, can be seen were over modern gadger and appliances purchases. Cases written in Star,Metro newspaper and other English& Malay dailies indicate that places that give easy credit for household Appliances were the predominant users of Collection Agencies services, apart from (motorbike, cars) Banks and Mortagage recalls.
4. Transportation which includes personal cars and motor bikes
This is obvious.... due to a lack of public transportation, the average income earner has no choice other than to buy motorbikes or Cars to get to work. Unfortunately, the cost of wages and Wage itself has not kept with the Times and Inflation. Thus our country lost a substancial portion of national Labor through these policies.
However, i like to note that up to the late 90s, single mothers and the average senior citizen and students (which up till then,had contributed substancially to the labor intensive industries)still had a good transportation back up plan in the small towns and cities because of the availability of Taxis which only cost something like 60cents from Klebang Besar to Jalan Hang Tuah.(my personal experience). Also, many Kampungs and Tamans had their own support system of taxis plying the routes with confirmed workers going for their Shift work -mainly sharing one taxi per route. The trip from Johor causeway to Melaka Bus Station in the late 90s was still only RM18.00 per customer through the local taxi system back then.
It is my belief that the loss of Public Transportation and the secondary Taxi market had reduced the worker influx we so needed because these low wage workers were the backbone of our SMI & SME industries, just couldn't afford the stress and pay the transport costs to go to work anymore.
5. Mortgage
Previously in the 60s and 70s a house costs under RM 10,000/- . Today, in big cities (or even Melaka) it averages RM380.000/- So, how does a young worker afford a roof over his head? PRIMA is a good solution but is it offered in the same manner in all Malaysian States? Melaka is lucky it has many more options for the low income earner although the social sites like Sayangi Melaka, Saya Anak Melaka and such reader inputs tells of a different story (for some).
But the headline here is on Mortgage...and as such for a new house under these new rates means income has to be raised through other means/ wife/parents have to contribute. (which reduces savings capacity for emergencies-but that's a different story)
6. Health/ Medical Insurance
The average middle class family man has no longer the option to buy medical insurance as the premiums cut into his household budget. Most survive the hard times by relying on medical cards or Employer Group cover...whichever is a cheaper option.
It is very absurd that private Medical services for certain deadly Health issues (heart congestion, Muscular dystrophy etc) can be billed as high as a low wage earners 3 year total income (RM 40,000++) or that senior citizens need to pay a minimum of RM 500/= to the private optometrist shop for corrective lens which government hospitals dont cover and this is something 85% of old people will need.
Things are so bad that General Hospitals staff are breaking their back to provide good medical care and service and facilities are bursting at the seams. Today, GH's are known to place sick patients in their corridors for lack of space as many citizens no longer can afford private medical care.
7. Child Care and Kindergarten
This was not an expenditure item in the late 70s because mother and grandparents were not out working for a living. Children were looked after normally by the elders in the family living together. Good food was available because mother was home to cook and take care of the house.
That is not the case today. Today it is not wrong to state that child care and kindergarten rates can go as high as 1/3 of the income earners wages...whatever their earning power. If you include the rates for hiring & keeping a Maid then thats a different level altogether.
8. Taxes
Very obviously it is High as we now pay Income Tax, Company Tax and Goods and Services Tax on top of Excise tax on cars and Hard Liquor/Cigarettes.
9. Entertainment
What Entertainment?
Even normal TV channels no longer are clear if you haven't changed to DTTV (Digital Broadcast). I should know. I'm experiencing it. Old aerials cannot access TV3 and TV9/8 together in my area. its either /or. For computer usage, I'm monthly supposed to be receiving 4MB down load speed but often find my access down to 2 MB because the carrier is diverting my signal to other high volume users during peak hours. After complaint, it will be back to normal for 2-4 weeks then the same earlier mentioned process happens again.
10. Education.
Big difference between the 70's till now. Highest disparity was the NEP which caused a large number of economic migrants to emigrate out for overseas educational opportunities and job offers. Those left behind were the ones who could not afford to pay their way out through an overseas education.
Latest numbers revealed in Parliament in 2016 was that 3 million Malaysians had given up their citizenship for foreign pastures....this does not include those who have PR elsewhere or work in foreign companies out of Malaysia.
It is revealing to note that GST was implemented because the government found it difficult to run its operations and meet its expenditure with only 20-29 % of its population being taxed (of working age) as the rest were old people and young students (out of 30 million citizens).
The outward migration by the cream of the crop since the 80's is beginning to be felt.
In summary, what my extrapolations leads to is that over the last 4 decades, middle income Family expenditures and savings options was taken away from them even though the economy was growing (due to higher debt margins and Inflationary GDP numbers)
What this meant was the the sustained hardships in Life was seen played (esp. in lower strata of society) out due to the loss of flexibility in managing/handling Financial hardship.
The single income families in the 70s although they earn lesser nominal money, enjoyed higher quality of flexibility in handling Financial hardships in Life because the fundamental things in life to maintain a growing family was cheaper back then.
This is my personal view.....What do you think?
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