by Dr Syed Husin Ali
Deputy Prime Minister and Finance Minister of Malaysia, Anwar Ibrahim, was removed from his senior government posts on 2 September 1998. A day later he was sacked as Deputy President and member of UMNO, the leading party in the government coalition. Now Prime Minister Dr Mahathir Mohamad not only holds the position of Home Minister, but has also assumed the function as First Finance Minister. He is also virtually the Foreign Minister and Minister of Trade. Mahathir has concentrated power on himself both in the government and his party; and he has also strong hold on the cabinet, the court and the media. His dictatorial powers are becoming stronger now than ever.
Sixteen years ago, six years after his release from a 22 month detention without trial under the Internal Security Act (ISA) and enjoying great popularity as president of the Islamic Youth Association (ABIM), Anwar was successfully enticed by Mahathir, then already Prime Minister and UMNO president, to join that party. Since then Anwar climbed very fast until he reached quite near the peak in the political hierarchy. Mahathir opened many avenues and opportunities to help Anwar go up. In most people's mind there was no doubt that Anwar was going to be Mahathir's successor.
Nevertheless, soon it was clear that there was difference in approach and style between the two leaders, and both admitted this fact. But they were mutually supportive of each other and it appeared impossible to separate them. But by 1997, differences had developed into conflicts between them. A few days before the UMNO Assembly in the middle of that year, Mahathir confirmed the existence of a poison pen letter, arising from a report made to the Premier, alleging Anwar of being involved in a sexual affair with someone's wife and homosexual activities with a driver. Mahathir's confirmation brought the matter to public knowledge, and many believed this to be Mahathir's way of weakening Anwar, who was believed to be preparing to vie for the president's position in UMNO. Anyhow, not long afterwards Mahathir and the police dismissed the poison pen letter as false and a lot of rubbish.
Differences Become Clearer
As time went on, stories about the differences and conflicts between Anwar and Mahathir became more widespread. When Malaysia began to face its economic crisis, in the form of depreciation of the ringgit and fall in the value of shares beginning July 1997, differences between them became clearer. Right from the beginning Mahathir blamed foreign financial speculators for the crisis and named George Soros as the main culprit. Mahathir rejected the pressure to follow Thailand and Indonesia by accepting help from the IMF and the World Bank. He branded, and quite correctly too, that both institutions were instruments of what he identified as neo-colonialism or new capitalism. He advocated control over international financial speculation.
Mahathir's position was viewed by some section of the Western ruling elite as being against liberalisation and free market, and a section of the western media began to attack him or gave him poor coverage. But the truth is that it was Mahathir himself who was responsible for opening the country to globalisation and the attendant liberalisation and free market policies. He supported them when they helped corporate figures close to him to amass wealth. In fact, Malaysia, through its Central Bank, was involved in speculation over the sterling in 1992-3, as a result of which it was believed the bank incurred a loss of around US$6 billion then. Perhaps it was infuriating for Mahathir that at the same time Soros made enormous profits.
Although Anwar did not openly oppose Mahathir's stand, yet in many speeches and interviews outside and inside the country, he quite frequently referred to weaknesses in the leadership and administration. He often alluded to terms like corruption, cronyism and nepotism, which were looked down by Mahathir as originating from the neo-colonial press and regarded by him as direct attack on him. As Finance Minister, Anwar appeared to be more open to IMF and World Bank prescriptions for overcoming the crisis. Nevertheless, he was never on record as stating that Malaysia should accept IMF bailout.
Anwar's relationship with the highest officials of the IMF and World Bank appeared to be more than cordial. This became clearer especially after Anwar became chairman of the Development Committee of IMF. Anwar was also becoming a darling of the western media, frequently receiving from them wide and sympathetic coverage. Some members of the US ruling elite were also seen to favour Anwar more than Mahathir. For example, during a visit to the Pentagon, Anwar was given red carpet treatment complete with gun salute. His close relationship with some high US officials at the time when Mahathir was attacking the neo-colonialism did not go down well with the latter and in fact aroused his suspicion against Anwar.
Fifty Proofs
Things came to a head during the UMNO general assembly in June this year. Just before the assembly started a book entitled "Fifty Proofs Why Anwar Cannot Be Prime Minister" was published. Copies of the book found their way into some conference bags that were distributed among delegates to the assembly. How could this happen, if not with the blessing of the top leaders, ask Anwar's "boys". The Secretary General of UMNO dismissed the complaint by saying that only one bag contained that book. The main chapters of the book consisted of a list of fifty allegations against Anwar, which involved sex scandals, as agent of foreign government, receiving money from foreign intelligence agency and so forth, and the poison letter that was exposed by Mahathir a year ago. The book used foul and vulgar language. It appeared to be put together in a great hurry.
On the other hand, accusations on corruption, cronyism and nepotism were hurled at the UMNO top leadership by the head of the UMNO youth wing, Zahid Hamidi. Mahathir and those around him took it as an attack on him in order to oust him. He was convinced that Anwar was behind this attack. During the assembly Mahathir disclosed several lists of people who were awarded special shares, privatised projects and transport permits. The lists showed that many prominent corporate figures close to Mahathir and also his children benefited from these. But it also showed that Zahid and some of Anwar's family members and close associates also enjoyed similar privileges. This blunted their attack on Mahathir.
The "50 Proofs", more than these lists damaged Anwar's reputation as a religious person. It strengthened Mahathir's position. After making a long and convincing speech at the end of the assembly, it was clear that Mahathir had won the day. Nevertheless, during the assembly and later, both Mahathir and Anwar continued to state that they would be mutually supporting each other. On a few occasions, Anwar pledged his undivided loyalty to Mahathir, but the latter seemed to be cynical. Anwar's position continued to be weakened and there was widespread speculation that his days were numbered.
Anwar's Power Curbed
Not long after the assembly, Mahathir announced the formation of a National Economic Action Council to be chaired by him with Daim Zainuddin, the former Finance Minister whom Anwar succeeded, as the chief executive. This move was viewed by many as an attempt to clip Anwar's wings. NEAC (or more appropriately Daim) was to take over the main functions of planning and executing measures to overcome the economic crisis. The majority of NEAC membership comprised ministers, corporate representatives and administrators. Then Daim was brought back to the cabinet, to enhance his powers. Soon he announced a National Economic Recovery Plan (NERP). Although Anwar continued to be Finance Minister, he was without any voice or power to deal with the key financial and economic matters.
The economic crisis affected a number of big corporate figures who were burdened with huge foreign loans that had increased following the fall of the ringgit against US dollars by about 50 percent. Furthermore, listed companies suffered heavy losses as a result of the fall of the share market by more than 70 percent, valued at around RM700 billion (or about US$185 billion at current rate). Among these companies were those owned indirectly through cronies of the UMNO leadership. They were set on using public money from the Employee's Provident Fund and the Pilgrimage Board Fund, as well as the country's reserves in order to bail out some of the crony companies. There was opposition to this and so voices of dissent had to be shut.
Mahathir immediately acted against the media so that they could be controlled effectively. The senior editors of two influential Malay newspapers - Utusan Malaysia and Berita Harian - and a senior programme officer of TV3 (a private television channel) were forced to resign. They were considered to be strong supporters of Anwar. Those who could be dominated by Mahathir succeeded them. A few weeks later, the Central Bank governor together with his deputy also sent in their resignation. They were regarded as being opposed to Mahathir's assertion that interest rates should be lowered and that there must be control over foreign exchange. Meanwhile, Anwar's occasional tennis partner by the name of Datuk Karuppan, who was earlier investigated in connection with the publication of "50 Proofs" was detained under the ISA and to be charged for illegal possession of 125 live bullets which carried death sentence.
Mahathir Acts
On 1 September 1998, Mahathir announced what he promised to be "shocking measures", which included fixing the ringgit at RM3.8 against the greenback, allowing a maximum of RM10,000 to be taken in and out of the country, and forcing back the ringgit stocked overseas by declaring that they would regarded as worthless after the lapse of a month. In a more shocking move, on the following day at 5.30 p.m., the Prime Minister's Department issued a statement announcing that Anwar had been stripped of all his government positions.
On the same night the television and the next day all newspapers gave full publicity to four affidavits which were in response to Karuppan's affidavit requesting to be transferred from the ISA holding centre to an ordinary lockup. In the affidavits almost all allegations contained in the "50 Proofs" were repeated. On the night of 3 September Anwar was stripped of his position in and sacked from UMNO. Apparently, the removal of Anwar from his government and party positions was precipitated because he refused to admit guilt and step down. He considers all these these allegations to be fabricated and false.
It is possible that there are several reasons why these shocking events took place. But I believe that the main one was that Mahathir and his associates feared Anwar would challenge and possibly defeat him in the forthcoming general assembly due in April 1998. Furthermore, a handful of billionaires and millionaires who had become very wealthy with the help of Mahathir wanted him to continue in power in order to protect their interests and help to rescue their ailing companies. At the same time they also wanted to be sure that in case anything happened to Mahathir, who was already 73 and had undergone heart surgery over then years earlier, he would be succeeded by someone reliable. Anwar was not seen as the right candidate, because not only he has declared to take stern action against corruption but also he was surrounded by a new set of ambitious young businessmen, who seemed to be in great hurry to replace the established ones surrounding Mahathir.
Anwar's Moves
After being sacked, Anwar expected to be arrested under the ISA or some other obnoxious acts. But at the time this article is written, over a week has passed without anything of this kind happening. Perhaps Anwar is temporarily saved by the presence of hundreds of media representatives who have come for the Commonwealth Games. Instead new allegations have been slapped on him under the Sedition Act and he is now also accused of interfering with police investigation. Right from day one large number of supporters and well wishers have been coming in droves every day in support of Anwar. Every night he addresses thousands of people who gather around his home. His speeches are recorded and the audio as well as videotapes are sold widely all over the country. His confidential letters to the Prime Minister have been distributed publicly too.
Anwar has announced that he intends to form a reform movement. But the meaning of the reform and the nature of the movement have not been spelt out. His main target is also still vague. He seems to be carried away by the Indonesian development. Up to date only four organizations closely associated with him, the main one being ABIM, have announced their involvement in the movement. Nevertheless, public sympathy for him is widespread and seems to be increasing, especially among the youths, the lower classes, professionals and government servants.
Anwar's main problem seems to arise from UMNO's political culture. A leader who loses power will easily lose his political support. UMNO leaders often hold well-paid positions in government and enjoy many perks and great wealth. Therefore, they often quickly turn to and pledge loyalty to the leader who still holds power. But these pledges may just be superficial. In case Mahathir falls, they can easily make new pledges of loyalty, even to Anwar should he come back to power. Another problem is that Anwar does not seem to have a compact organisation and he also lacks tested cadres. It is hard to predict, therefore, how long the support given to him will persist should he be detained or jailed.
The Future
Anwar has stated categorically that he would neither form a new political party nor join any of the existing ones. He still seems to be toying with the idea of being reinstated in the party and government in order to continue with his reform movement within UMNO. In fact, there are a number of UMNO divisions within his home state of Penang which, while upholding Mahathir's leadership, are appealing for Anwar to be reinstated to all his former positions. This is impossible to happen as long as Mahathir remains in power. As the Malay saying goes, he will not lick his own sputum. Further, according to the UMNO constitution, a sacked person can only reapply to be member after three years. No doubt there have been cases where a number of members who were sacked following allegations of involvement in money politics were taken back after about a year; the UMNO supreme council apparently has the power to decide so.
But in the case of Anwar, this cannot happen as easily, because the allegations against him are too many and too heavy, and made by none other than Mahathir himself. Now Mahathir seems to have ignored the other allegations and now concentrates on those relating to sex and moral issues. Mahathir will try to convince the country that Anwar is not fit to hold important leadership positions because his real character is not consistent with the religious fa็ade that he presents. Mahathir already has most of the UMNO leaders in his pocket. But if he fails to move the public to his side or should he suddenly die, then only then will Anwar would have a chance to go back to UMNO, but not necessarily with the guarantee that he could return to his old positions.
There seems to be not much choice between Mahathir and Anwar. Progressives can be easily attracted to Mahathir's pronouncement against neo-colonialism and the fear of foreign capital dominating the country. How genuine is he and how long can or will he maintain this position? At the same time he cannot be trusted because he has slowly turned into a one-man dictator, violating fundamental practices of democracy and basic human rights. On the other hand Anwar may attract a lot of people because of his populist approach and concern for civil society and human rights. But then, there may be strong reservations among certain quarters because of his strong leanings towards the West, foreign capital and IMF. Certainly a third alternative has become necessary.
* Dr Syed Husin Ali is president of PRM, the Malaysian Peoples Party and a former professor of sociology and anthropology at the University of Malaya. He was detained for six years under the Internal Security Act.