It’s The Classes, Stupid!

September 2, 2020

It’s The Classes, Stupid!

Three months after the infamous “Sheraton Move”, the Department of Statistics published the “Household Income & Basic Amenities Survey Report 2019”, which “unsurprisingly” found that the average household income of Chinese households remained the highest among all groups at RM9,895, followed by RM8,216 for Indian households and RM7,093 for Bumiputera households (inclusive of the Malays, Orang Aslis and East Malaysia bumiputeras). “The Chinese are the richest, followed by the Indians, and only then the Bumiputeras”, or so did the different news portals reported.

The reports stated that “One of the largest challenges to the country is increasing inter-ethnic inequality”, with the implicit assumption that the Chinese remain the hidden masters of the economy, while the bumiputeras continue to languish economically. With politicians like Dr Mahathir throwing out yet another round of the “Rich Chinese / Lazy Malay” rhetoric, we need to critically analyze the claims made by the report and Dr Mahathir. Are the facts being twisted?

Charles Seife, in a wonderful book called “Proofiness: The Dark Arts of Mathematical Deception” writes: “Phony data, bogus statistics, and bad mathematics can make the most fanciful idea, the most outrageous falsehood seem true. They can be used to bludgeon enemies, to destroy cities, and to squelch debate. Indeed, some people have become incredibly adept at using fake numbers to prove falsehoods. They have become masters of proofiness: the art of using bogus mathematical arguments to prove something that you know in your heart is true - even when it’s not”.



Statistics 101: Unjustified Generalisations?

Anyone who has spent some time reading the actual report will be able to tell that the reality is more complex than the simple racial rhetoric so often thrown around. Firstly, the report uses average household income as the single most important metric to present data on racial inequality. But taking a much closer look at groups with a monthly household income below RM2,000, the bumiputeras do indeed constitute a big majority of this group, being at 307,700 households, while Chinese households are at 66,000, Indian households being at 25,000 and other races being at 5,000 households.

In terms of households with an income beyond RM15,000 however, bumiputeras also constitute the largest group with 345,600 households, the Chinese follow closely at 316,800 households, Indians next with 65,500 households and other groups being at 2,800 households. What this means is that at both ends of the economic spectrum, there are about 300,000 poor bumiputeras and 345,000 rich bumiputeras. All this makes it quite obvious that while some groups are indeed disproportionately richer than others, it is patently false that “All bumiputeras are poor and all Chinese people are rich”. It is surprising that the Department of Statistics which prides itself on its objectivity would be silent on mentioning this point.

The report by the United Nations Special Rapporteur on extreme poverty and human rights published recently, exposed a more sinister way the Department of Statistics distorts economic data, which is the unjustified grouping of Malays, Orang Aslis and East Malaysian Bumiputeras into one group - Bumiputeras. This not only obscures the actual economic status of the Orang Aslis and East Malaysian Bumiputeras, but also weakens the effectiveness of economic policy targeted at these groups. With urban Malays, Peninsular Orang Aslis and Eastern Malaysian Bumiputeras living in incredibly different socio-economic and geographic environments, this is a highly questionable move on the part of the Department of Statistics.

This aside, one needs to make it clear that while the bumiputeras dominate both ends of the economic spectrum, the group which suffers from the highest intra-ethnic inequality turns out to be the Chinese. The richest Malay households own about 23.9% of annual Malay household income, but the richest Chinese households own a whopping 42.7% of annual Chinese household incomes. We should keep this fact firmly at the back of our minds even as we look at the predominance of Chinese billionaires in this country - they may actually skew the data so much that the “average household income of Chinese households” becomes a highly questionable metric to reflect the more sombre economic reality in the vast majority of Chinese households.



Moving beyond racial politics

It is regrettable to see how economic data has further entrenched racial politics in this country - as people rush to unjustified conclusions that shore up their racial stereotypes and neglect the more complex realities underneath. The Household Income Survey however, should help us to see reality as it is and to spur the creation of effective economic policies that will help all Malaysians, regardless of race, religion and class. I will briefly mention two examples of policy issues that transcend racial lines, but demand our attention.

Firstly, the poverty rate among those above the age of 65 has increased from 10.9% in 2016 to 12% in 2019. This signals a need for the Government to pay attention to an aging population, which necessitates more welfare and medical spending for the elderly. Another issue is the rise in urban poverty. Malaysia has a high urbanisation rate, with 80% of Malaysians now living in urban areas. The United Nations now estimates that Malaysia’s poverty rate lies at about 15-20%. What this means is that we need to take urban poverty much more seriously, since not all of the 20% of those who live in rural areas are poor. In fact, the urban poor may have an even tougher time to survive, having to cope with issues like higher cost of living, rising housing prices and weaker social support.

If our policymakers, bureaucrats, statisticians and politicians continue to view everything through an outdated and narrow racial lens, Malaysia is destined to be stuck in the mud of racial politics and stagnate as a nation. Bill Clinton’s 1992 campaign slogan: “It’s the economy, stupid!” came at a time when the Republicans had ruled for a continuous 12 years. But even as the Republicans had succeeded in winning the Cold War and defeated Saddam Hussein’s Iraq, the eventual economic stagnation led to increased economic inequality among the American people. However, a simple slogan excited the American imagination, which won the popular support of the American people.

After 60 years of racial politics and an outdated New Economic Policy, Malaysia deserves much better. What we need is a new social consensus among all of us, which will view public issues from the lenses of justice and class, and to empathetically make policies which will benefit the needy. The only response we should give to those politicians who continue to milk the racial cow is to say: “Its the classes, stupid!”


Lee Chean Chung
State Asseblyman of Semambu


Lee Chean Chung is the Treasurer General of People’s Justice Party and State Assemblyman of Semambu. He holds a master in Transportation and Logistics from Malaysia University of Science and Technology (MUST) and Master in Public Administration from LKY School of Public Policy, National University of Singapore.

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