It is always a defence of academics to say that when they discuss the moral and political questions of the day, their first duty is to the rigor of the argument - not to its presentation to outsiders.
It must be that economics dons feel this compulsion the more. Otherwise would Thomas Carlyle have disdained them as professors of “the dismal science”?
The nexus between business and politics has long been the focus of the academic gaze of Edmund Terence Gomez, recently elevated to a full professorship by Universiti Malaya (UM).
Gomez (left) has written reams about this link over the last 15 years at least, so it was not surprising he chose ‘Political Business: Policies, Power and Patronage in East Asia’ as the topic of his inaugural lecture as a full-fledged professor at UM on July 26.
Gomez has done his due diligence on this subject. The upshot: a survey of the fusion of politics and business in East Asian economies that has turned out to be both boon, because it had rapidly powered the growth of the economies under study, and blight, because it had brought debilitating corruption in its slipstream.
Gomez’s inaugural lecture, all 46 pages of text and 42 of footnotes and bibliographical references, was based on an impressive trove of research and reporting - of the sort that would have invited Carlyle’s stricture about the drudgery of the thing.
Perhaps the tedium could have been alleviated by a willingness to treat with the ideas buzzing in the interstices of the research he has marshalled for his argument that the phenomenon of political business has led to the monetisation of politics.
Early in the lecture, Gomez gave a tantalizing glimpse of this willingness when he adverted to the contest of ideas between two of the founders of the American project in self-governance - between Alexander Hamilton, who was for state intervention in the economy, and Thomas Jefferson, author of the Declaration of Independence, who was sceptical of statism.
Pity that this was only a brief foray in eclecticism, soon smothered by the rigor of Gomez’s diligent ferreting of the facts to support his argument that, for the success of state intervention in the economy, the oversight authority of institutions should not be interfered with by the executive branch.
Corruption, cronyism and nepotism followed hard upon such interference with oversight institutions by the political authority
Gomez’s past treatises on this interference had not endeared him to the powers-that-be because these were critical of the corruption, nepotism and cronyism spawned by the way politics mingled with business in Malaysia.
His promotion to a full professorship in Universiti Malaya, where he has taught for most of his academic career, was seen as punitively delayed for reason of the trenchancy of his criticisms of political business and its effects on the Malaysian economy.
‘A highly interventionist state’
Gomez devoted half the lecture to what he called an “intriguing study” of the Malaysian variant of political business “involving a highly interventionist state along with the adoption of non-interventionist neoliberal ideas including extensive privatisation of government entities.”
Here again the study was impressively researched, detailing how government intervention in the economy to boost growth and distribute rents was carried out from the era of Dr Mahathir Mohamad - with its emphasis on favoring a coterie of bumiputra entrepreneurs who were encouraged to make an international impact - through to the time of Abdullah Ahmad Badawi - who tried to right the balance by favoring small and medium enterprises (SMEs) - and ending up with Najib Abdul Razak - who vainly seeks to check the corruption that inequitable distribution of government rents has spawned.
From the outset, with respect to development theories for East Asian economies, the prescriptions on offer revolved around what was called the ‘Washington consensus’ - which was stabilise, privatise and liberalise - and the recipe that was mostly followed - which was export-led, state-backed manufacturing and the manipulation of financial markets such that these supported the industries that were state-favoured.
The latter prescription brought rapid development to the economies that followed the formula but at the cost of corruption, in some places on a scale debilitating enough to retard growth while producing stark inequalities in income.
The Washington consensus flowed from the ideas of Adam Smith and Friedrich Hayek, by which the common good is unintentionally advanced by people acting in self-interest with the state as a neutral but fair umpire; whereas the East Asian formula was redolent of the thought of John Maynard Keynes, who believed in state intervention in the economy to boost demand.
Gomez’s historical survey of the nexus between business and politics in East Asian countries would have benefited from grappling with the ideas embedded in the economic phenomena he studied.
In his study of the Malaysian variant of developmental economics, Gomez argues that had the oversight role of financial and juridical institutions not been interfered with, the prescriptive formula employed would not have led to the corruption, cronyism and nepotism that are now rampant and are hindrance to growth.
The contrary view would hold that with the state so prominent in the economy, the stage is already preset for those ailments.
It must be that economics dons feel this compulsion the more. Otherwise would Thomas Carlyle have disdained them as professors of “the dismal science”?
The nexus between business and politics has long been the focus of the academic gaze of Edmund Terence Gomez, recently elevated to a full professorship by Universiti Malaya (UM).
Gomez (left) has written reams about this link over the last 15 years at least, so it was not surprising he chose ‘Political Business: Policies, Power and Patronage in East Asia’ as the topic of his inaugural lecture as a full-fledged professor at UM on July 26.Gomez has done his due diligence on this subject. The upshot: a survey of the fusion of politics and business in East Asian economies that has turned out to be both boon, because it had rapidly powered the growth of the economies under study, and blight, because it had brought debilitating corruption in its slipstream.
Gomez’s inaugural lecture, all 46 pages of text and 42 of footnotes and bibliographical references, was based on an impressive trove of research and reporting - of the sort that would have invited Carlyle’s stricture about the drudgery of the thing.
Perhaps the tedium could have been alleviated by a willingness to treat with the ideas buzzing in the interstices of the research he has marshalled for his argument that the phenomenon of political business has led to the monetisation of politics.
Early in the lecture, Gomez gave a tantalizing glimpse of this willingness when he adverted to the contest of ideas between two of the founders of the American project in self-governance - between Alexander Hamilton, who was for state intervention in the economy, and Thomas Jefferson, author of the Declaration of Independence, who was sceptical of statism.
Pity that this was only a brief foray in eclecticism, soon smothered by the rigor of Gomez’s diligent ferreting of the facts to support his argument that, for the success of state intervention in the economy, the oversight authority of institutions should not be interfered with by the executive branch.
Corruption, cronyism and nepotism followed hard upon such interference with oversight institutions by the political authority
Gomez’s past treatises on this interference had not endeared him to the powers-that-be because these were critical of the corruption, nepotism and cronyism spawned by the way politics mingled with business in Malaysia.
His promotion to a full professorship in Universiti Malaya, where he has taught for most of his academic career, was seen as punitively delayed for reason of the trenchancy of his criticisms of political business and its effects on the Malaysian economy.
‘A highly interventionist state’
Gomez devoted half the lecture to what he called an “intriguing study” of the Malaysian variant of political business “involving a highly interventionist state along with the adoption of non-interventionist neoliberal ideas including extensive privatisation of government entities.”
Here again the study was impressively researched, detailing how government intervention in the economy to boost growth and distribute rents was carried out from the era of Dr Mahathir Mohamad - with its emphasis on favoring a coterie of bumiputra entrepreneurs who were encouraged to make an international impact - through to the time of Abdullah Ahmad Badawi - who tried to right the balance by favoring small and medium enterprises (SMEs) - and ending up with Najib Abdul Razak - who vainly seeks to check the corruption that inequitable distribution of government rents has spawned.
From the outset, with respect to development theories for East Asian economies, the prescriptions on offer revolved around what was called the ‘Washington consensus’ - which was stabilise, privatise and liberalise - and the recipe that was mostly followed - which was export-led, state-backed manufacturing and the manipulation of financial markets such that these supported the industries that were state-favoured.
The latter prescription brought rapid development to the economies that followed the formula but at the cost of corruption, in some places on a scale debilitating enough to retard growth while producing stark inequalities in income.
The Washington consensus flowed from the ideas of Adam Smith and Friedrich Hayek, by which the common good is unintentionally advanced by people acting in self-interest with the state as a neutral but fair umpire; whereas the East Asian formula was redolent of the thought of John Maynard Keynes, who believed in state intervention in the economy to boost demand.
Gomez’s historical survey of the nexus between business and politics in East Asian countries would have benefited from grappling with the ideas embedded in the economic phenomena he studied.
In his study of the Malaysian variant of developmental economics, Gomez argues that had the oversight role of financial and juridical institutions not been interfered with, the prescriptive formula employed would not have led to the corruption, cronyism and nepotism that are now rampant and are hindrance to growth.
The contrary view would hold that with the state so prominent in the economy, the stage is already preset for those ailments.
TERENCE NETTO has been a journalist for close on four decades. He likes the occupation because it puts him in contact with the eminent without being under the necessity to admire them. It is the ideal occupation for a temperament that finds power fascinating and its exercise abhorrent.
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