THE BOYS HAVE LEARNT HOW TO BORROW MONEY AND NOT PAY IT BACK

 First here is Hanna Kam of Free Malaysia Today.

Our total GDP is around RM1,400 billion or RM1.4 Trillion. If our government's debt is RM1,500 billion or RM1.5 trillion that means our government borrowing is already way above our total GDP.

And considering that much of this money is lost through corruption, wasteful spending on projects that do not generate economic or financial returns it means that we are indeed headed towards becoming another Sri Lanka. 

And keep this in mind - the government's tax revenue is around RM170 billion. If the Madani fellows want to raise the rates of taxation (higher income taxes, higher GST etc) that will only kill off the economy. The better way is to lower the taxation rates. We should seriously ponder ONE MAGIC NUMBER for all taxation. That magic number shall be 15%.Personal income tax rate 15% flat, corporate tax rate 15% flat, import duties, levies, taxes totalling 15% flat. 15% shall be the MAGIC NUMBER. 

If we shutdown or get rid of the GLCs the government borrowings may drop 25% to 30% or more. I will give examples here.

Dont worry folks. This is a great country. A really fantastic country. But only if you do things right. And here is the big secret - it is really super easy to do the right things. 

Then we must grow the economy at accelerated rates of 10% or more and grow the economy by building viable and practical economic projects which generate good returns on investment. Then the sales and revenues throughout the economy will increase and the government will have a larger tax base. The government will actually collect more taxes. So the tax rates can be lower but the total tax collection will be higher. 

Lets target to become a US1.0 Trillion economy asap. That means we will become a member of the exclusive US$ Trillion Dollar Club ie countries with GDPs in excess of US$1.0 trillion.  In Ringgit that will RM4.67 Trillion or 3.3 times our present GDP. The government will collect 3.3 times more taxes.

Assuming we lock up all the corrupted fellows, recover the stolen monies, sell off all the GLCs, the gomen gets out of business and we stop paying pensions for all ex MPs, ex ADUNs, ex Ministers and ex prime ministers the government's debt will drop like a stone. Malaysia will be a super duper rich country.

But just two days ago Madayani fellow said he will give Felda RM1.0 billion a year for 10 years!! Why? For what? To get the votes of Felda Melor and Felda Jengka 24? 

What will they do with RM1.0 billion for 10 years? Do you have a cashflow analysis? How will they pay back the RM10 billion over 10 years? 

Where will the gomen get RM1.0 billion a year for 10 years to give to Felda? Borrow more money? The government debt will become RM2.0 Trillion in no time.

The boys have learnt that the gomen they lead has the power to borrow money. They tell the Bank Negara fellows to issue bonds for the gomen. The bonds automatically carry a gomen guarantee (as do all soverign bonds). Then the bonds are 'bought' by the funders, lenders, investors, bond buyers or whatever it is you want to call them. Usually the local gomen run fund managers like the EPF, KWAP etc are the folks who buy the gomen bonds. Meaning they use public funds - our money - to buy the gomen bonds.

Then the gomen repays the  bonds over the tenure of the bonds ie 10 years, 12 years, 15 years, 20 years etc.  If the gomen has no money to repay the bonds they still issue new bonds, borrow new money to repay the old bonds. Like the girl said they dig one hole and use the soil to cover up another hole. Just keep digging holes.

This is what is happening now. Madayani talks a lot of rubbish about reducing debt but just keep an eye on the Bank Negara announcements for the issuance of new bonds by the gomen (they are required to publish it in the newspapers). They have not stopped borrowing money.

For example the gomen's revenue is around RM170 billion but the Budget 2023 is RM330 (??) Billion.  That is a shortfall of RM160 billion already. So how? Just issue more bonds. Borrow more money. The bonds may be payable over 10 years, 15 years or longer.

So what do the politicians care. They will be kicked out of office in six months or in one year. Someone else will have to worry about repaying the debt.

In the meantime:

Anybody needs RM1.0 billion a year? For 10 years?

Anybody wants to buy some more ships for the Navy? How much? RM9.0 billion?

Anybody needs vending machines to sell nasi lemak? How much? 

Tuan-Tuan you must vote them out.