Monday, March 31, 2008
Kawal harga ataupun pastikan bekalan?
Chapter 34, "Price Controls Are Back!"
excerpts from MAKING ECONOMIC SENSE by Murray N. Rothbard
Bad and discredited ideas, it seems, never die. Neither do they fade away. Instead, they keep turning up, like bad pennies or Godzilla in the old Japanese movies.
Price controls, that is, the fixing of prices below the market level, have been tried since ancient Rome; in the French Revolution, in its notorious "Law of the Maximum" that was responsible for most of the victims of the guillotine; in the Soviet Union, ruthlessly trying to suppress black markets. In every age, in every culture, price controls have never worked. They have always been a disaster.
Why did Chiang-kai-Shek "lose" China? The main reason is never mentioned. Because he engaged in runaway inflation, and then tried to suppress the results through price controls. To enforce them, he wound up shooting merchants in the public squares of Shanghai to make an example of them. He thereby lost his last shreds of support to the insurgent Communist forces. A similar fate awaited the South Vietnamese regime, which began shooting merchants in the public squares of Saigon to enforce its price decrees.
Price controls didn't work in World War I, when they began as "selective"; they didn't work in World War II, when they were comprehensive and the Office of Price Administration tried to enforce them with hundreds of thousands of enforcers. They didn't work when President Nixon imposed a wage-price freeze and variants of such a freeze from the summer of 1971 until the spring of 1973 or when President Carter tried to enforce a more selective version.
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In 1946, all federal price controls had been lifted except on meat, and as a result, meat was in increasingly short supply. It got so bad that no meat could be found, and diabetics could not even find insulin, a meat-derived product. Radio disk jockeys implored their listeners to write to their Congressmen urging them to keep price controls on meat, for if not the price would triple, quadruple, who knows, rise to infinity. (Ignored was the question: what's so great for the consumers about cheap meat that no one can find?)
Finally, in summer, President Truman went on the air in a nationwide radio address. Summing up the dire meat crisis, he said, in effect, that he had seriously considered nationalizing the Chicago meatpackers in order to commandeer hoarded meat. But then he realized that the meat-packers had no meat either. Then, in a remarkable revelation that few commented on, he disclosed that he had given serious consideration to mobilizing the National Guard and the Army, and sending troops into Midwestern farms to seize all their chickens and livestock. But then, he reluctantly added, he had decided that such a course was "impractical."
Impractical? A nice euphemism. Sending troops into the farms, Truman would have had a revolution on his hands. Every farmer would have been out there with a gun, defending his precious land and property from a despotic invader. Besides, it was a Congressional election year, and the Democrats were already in deep trouble in the farm states.
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Truman reluctantly concluded that there seemed to be only one course left to him: to abolish the price controls on meat, which he proceeded to do. In a couple of days there was plenty of meat for consumers and the diabetic alike. The meat crisis was over. Prices? They did not, of course, go up to infinity. They rose by something like 20% from the unrealistic control level.
The most remarkable part of this affair went unremarked: that President Truman, apparently without knowing it, had conceded the crucial point: that the "shortage" was, pure and simple, an artificial creation of his own price controls. How else interpret the fact that even he admitted that the last, unfortunate resort to end the crisis was to abolish the controls? And yet, no one drew this lesson and so no one initiated impeachment proceedings.
Twenty-five years later, President Nixon imposed a price-wage freeze because inflation had reached what was then an "unacceptable" level of 4.5% a year. I went ballistic, denouncing the controls everywhere I could. That winter, I debated Presidential economic adviser Herbert Stein before the Metropolitan Republican Club of Washington, D.C. After I denounced price controls, Stein remarked that, in essence, the price controls were my fault, not his and President Nixon's.
Stein knew as well as I did that price controls were disastrous and counter- productive, but I and others like me had not done a good enough job of educating the American public, and so the Nixon Administration had been "forced" by public pressure to impose the controls anyway. Needless to say, I was not convinced about my guilt.
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Health care prices have risen faster than inflation. The threat of controls over health care has brought forth a chorus of protests from economists, and from former price controllers, who learned about price controls the hard way. Thus, C. Jackson Grayson, who headed Nixon's price-wage control experiment from 1971 to 1973, warns: "price controls will make things worse. Believe me, I've been there. ...Controls have not worked in 40 centuries. They will not work now."
Grayson warns that, already 24% of U.S. health care is spent on administrative costs, largely imposed by government. Clintonian price control will cause regulations and bureaucrats to proliferate; it will raise medicals costs, not lower them. Barry Bosworth, who headed price control efforts under Jimmy Carter, reacted similarly: "I can't believe they are going to do it. I can't believe they are that stupid." He pointed out that health care, a field where there is rapid innovation in goods and services, is a particularly disastrous area to try to impose price controls.
But none of these objections is going to work. ...Clintonians don't mind if price controls cause shortages of health care. In fact, they welcome the prospect, because then they can impose rationing; they can impose priorities, and tell everyone how much of what kind of medical care they can have. And besides, ... there's that deeply satisfying rush of power. We should know by now that reasoned arguments by economists or disillusioned ex-controllers are not going to stop them: only determined and militant opposition and resistance by the long-suffering public.
-- excerpted from Chapter 34 of MAKING ECONOMIC SENSE by Murray N. Rothbard Find the book here: http://www.FreedomKeys.com/bkecon.htm#sense
Sunday, March 30, 2008
Benarkah Tawaran Terbuka tidak adil dan saksama?
March 30, 2008 00:06 AM
He said in principle the proposal by the state government to emphasise on equitability appeared to be good but this would actually result in only those who were financially strong benefiting from the system.
"The transparency, open tender and open bidding approach is certainly good and gives comfort to everyone but we have to remind them that not everything that is said to be equitable is fair. Actually, only the strong and those with financial capacity will derive benefits from it.
"This is our reminder to them because it is our (Barisan Nasional's) responsibility as the opposition party (in Penang) to give our views and we will become an opposition that is active, sensitive and curious about what is happening in Penang. We are not around just to keep the seat warm," he said at a thanksgiving gathering held by the Penang Umno Liaison Body, here Saturday night.
He clarified that the New Economic Policy (NEP) was not merely for the Bumiputeras as it also assisted the Chinese and Indian communities because the policy was not racially biased. He said the NEP was a national approach implemented to eliminate poverty regardless of race, enable equitable distribution to the people including enlarging the Bumiputera Commercial and Industrial Community (BCIC) and ensuring a robust economic growth to be enjoyed by all races.
Abdullah, who is also the chairman of the State Umno Liaison Body, reminded the 11 Umno Assemblymen, who represent the Barisan Nasional (BN), to fight for the cause of all races in the state.
"They have a heavy responsibility not only as the Assemblymen in their constituency but also as the opposition in the State Assembly," he said.
As such, he praised the strategy of the State Umno Liaison Body to give each Assemblyman a responsibility or portfolio to monitor the implementation of state government policies.
At the meeting of the state Umno management committee chaired by Adullah earlier Saturday, it was decided that a `shadow executive council' would be appointed with each of the Umno assemblymen who won in the recent general election being given portfolios equivalent to the state government executive council.
The Prime Minister also gave an assurance to the people of Penang that the federal government led by the BN would continue to give effective service to the people and fulfil the promises contained in its manifesto.
Also present at the gathering were deputy chairman of the Penang Umno Liaison Body Datuk Seri Abdul Rashid Abdullah, Gerakan acting president Tan Sri Dr Koh Tsu Koon and Perlis Umno Liaison chairman Datuk Seri Shahidan Kassim.
-- BERNAMA
Wikipedia
"Tender terbuka" adalah juga panggilan terbuka untuk tender, juga dikatakan tender yang diiklankan, adalah terbuka kepada semua vendor ataupun kontraktor yang dapat menjamin pencapaian kerja-kerja yang memuaskan.
"Open tenders", in other words open calls for tenders, also called advertised tenders, are open to all vendors or contractors who can guarantee performance.
"Tender tertutup", adalah panggilan tender terhad, juga dikatakan tender jemputan, pra-kelayakan, senarai pendekkan, atau tender terpilih, adalah hanya terbuka kepada vendor-vendor atau kontarkor-kontarktor pra-berkelayakan.
"Restricted tenders", in other words restricted calls for tenders, also called invited tenders, prequalified, short-listed, or selective tenders, are only open to selected prequalified vendors or contractors.
Tidak juga kurang penting, lagi menjadi kewajipan bagi pegawai agensi awam yang mengendalikan pembangunan kemudahan awam menggunakan dana awam supaya mendapat nilai untuk wang yang merupakan amanah.
Dalam pasaran bebas, persaingan mendorong kepada kecekapan melalui dayacipta dan penyumberan ke arah kos efektif supaya pelanggan mendapat faedah yang optimum untuk pelaburan dan juga vendor-vendor/kontraktor-kontraktor yang terlibat adalah berdaya maju dalam sebarang suasana termasuk kecemerlangan pengurusan modal operasi, peneraju pembaharuan teknologi serta komited untuk membangun sebagai penyedia perkhidmatan yang profesional dan berintegriti.
Sebagai salah satu dasar kerajaan untuk membangunkan kontraktor-kontraktor bumiputra yang berjaya, adalah penting tatacara pemberian tender-tender awam ataupun swasta (GLC) berasaskan prestasi dan keupayaan, walaupun bantuan awalan adalah penting dan wajar, supaya beban pembangunan usahawan bumiputra tidak menjadikan kedudukan negara tidak kompetitif serta beban kepada rakyat.
Muhammad Sha'ani b. Abdullah
Thursday, March 27, 2008
NST : End price control on cooking oil, say planters
2008/03/27
End price control on cooking oil, say planters
By : Evangeline MajawatMalaysian Estate Owners’ Association president Boon Weng Siew says the palm oil industry is suffering from the subsidy scheme. |
KUALA LUMPUR: Palm oil producers want the price control on cooking oil to be abolished.
Responding to Domestic Trade and Consumer Affairs Minister Datuk Shahrir Abdul Samad's suggestion to review price control and subsidies, Boon said artificial price controls led to shortages in the market.
Cooking oil is capped at RM2.50 per kg, half the global market price.
"Price control leads to smuggling and artificial shortage such as the one in January," he said.
The cess is levied when the CPO price is above RM1,500 per tonne. For every RM100 increase in price, industry players must pay RM2 in cess.
"The current CPO price is RM3,500 per tonne. We're paying about RM40 per tonne in cess every month, on top of other taxes," Boon said.
The cess collected is used by the government to subsidise palm oil manufacturers.
"The COSS will end in June and we hope that the government will do away with it and float the price in tandem with the global market."
He said a competitive price would yield higher income, which meant increased corporate taxes.
"Maybe the government could use the extra income from the tax to subsidise the poor and needy.
"If the subsidy is abolished, the RM3 hike in cooking oil to RM5.50 per kg has minimum effect on inflation.
"The additional burden on a household of five will only be RM2 per capita monthly.
"The increased price will also promote a healthier lifestyle among Malaysians as they are discouraged from excessive consumption of oil," Boon said.
Meanwhile, Consumers Association of Subang and Shah Alam president and legal adviser Jacob George said he agreed with Shahrir's move to subsidise consumers rather than producers.
"Consumers and farmers should be given a fair subsidy, but the government has to find new ways to eradicate the role of third parties," he said.
Kuala Lumpur Consumers Association secretary-general R. Rupa Saminathan, however, disagreed.
"With a higher subsidy, farmers will be able to increase production, thus meeting market demands at all times."
Federation of Livestock Farmers Associations of Malaysia broiler unit deputy chairman Yap Kim Wah said Shahrir's plan to remove certain items from the controlled list was a good idea.
"With a more sensible list, producers and farmers will cater to the demand, which profits farmers and consumers."
Federation of Malaysian Consumer Associations secretary-general Sha'ani Abdullah agreed with Shahrir's thrust to educate consumers on buying quality and not brand.
Wednesday, March 26, 2008
rtm : Consumer Associations give strong support of Datuk Shahrir statement
Author: Wan Su
Date: 26/03/2008
Kuala Lumpur - Consumer Associations have come out in strong support of a statement by newly appointed Domestic Trade and Consumers Affairs Minister, Datuk Shahrir Samad that the government might open the market for essential goods to prevent manipulation by traders and ensure supply and fair price.
They want the government to stabilize the price of goods and maintain control over stockpiles to protect consumers.
Federation of Malaysian Consumer Associations (FOMCA) Secretary General, Muhammad Sha'ani Abdullah said the move would create competition between local and foreign producers.
He said under the ASEAN Free Trade Area, (AFTA), ASEAN countries must open their market to member states and reduce tax.
On Monday Datuk Shahrir had said the government would not hesitate to import essential goods to protect consumers.
Real Estate and Housing Developer's Association Malaysia (REHDA) Presiden Ng Seing Liong said the association was considering doing away with the price control mechanism to ensure sufficient supply of consumer goods in the market.
Tuesday, March 25, 2008
Consumer Associations Support Open Market To Control Price
March 25, 2008 23:24 PM
KUALA LUMPUR, March 25 (Bernama) -- Consumer associations have come out in strong support of a statement by Domestic Trade and Consumers Affairs Minister Datuk Shahrir Samad that the government might open the market for essential goods to prevent manipulation by traders and ensure supply and fair price.
They want the government to stabilise the price of goods and maintain control over stockpiles to protect consumers.
Federation of Malaysian Consumer Associations (Fomca) secretary-general Muhammad Sha'ani Abdullah said the move would create competition between local and foreign producers.
He said under the Asean Free Trade Area (AFTA), Asean countries must open their market to member states and reduce tax.
"If the price of goods in Malaysia is high, the government can import from Asean countries at low prices. Producers in Malaysia must be prepared to compete and this will benefit consumers who will enjoy fair price," he told Bernama here Tuesday.
Monday, Shahrir had said the government would not hesitate to import essential goods to protect consumers.
Meanwhile, Malaysian Muslim Consumers Association project director Noor Nirwandy Mat Nordin said in opening the market, the government should also ensure that local producers, particularly Bumiputeras were protected.
"This is because, products by Bumiputeras find it difficult to compete in the open market because of the monopoly by the wholesale system and retail chain in the country," he added.
Real Estate and Housing Developer's Association Malaysia (REHDA) president Ng Seing Liong said the association was considering doing away with the price control mechanism to ensure sufficient supply of consumer goods in the market.
-- BERNAMA
Saturday, March 15, 2008
Civil society's wish for new cabinet
Azreen Madzlan and Ki Mae Heussner | Mar 15, 08 4:17pm
What is the civil society’s wish for the new cabinet? Malaysiakini pitches a few questions to eight special interests groups to get their feedbacks on who, what and how the new cabinet should be.
Muhammad Sha'ani Abdullah: CEO Federation of Malaysian Consumers Associations (Fomca)
Prime Minister (Abdullah Ahmad Badawi) should appoint new faces with corporate managerial experience who can bring in change to the work culture of the government machinery. He must also do away with ethnicity-based arrangement.
On downsizing cabinet: The current cabinet is too big - causes coordination problem. More consolidation is necessary.
On the Domestic Trade and Consumer Affairs portfolio: We support the PM to maintain minister (Mohd Shafie Afdal). He has pro-actively carried out work with the industry and NGOs. We’re satisfied with the current minister.
On Khairy Jamaluddin being a minister: It will be seen as nepotism. There are equally capable people in and outside the party to carry out these functions. He’s related to PM, so there will be a conflict of interests. This will not look good for the government.
Yap Swee Seng: Executive Director, Suara Rakyat Malaysia (Suaram)
In general, we want people with integrity and credibility, people with clean records, without corruption and without abuse of power.
Also, for those who are already staying for too long, they should not be included in the new cabinet. For instance - Rafidah Aziz, she has not been accountable to the people.
On downsizing cabinet: We have a very bloated cabinet during Pak Lah’s time. Increasing the number doesn’t help increase productivity. Suaram welcomes the downsizing.
On Khairy Jamaluddin being a minister: I think based on his record and insensitivity to the different communities in the country and also his involvement in the ECM Libra issue, he’s not a suitable candidate. There are so many doubts and questions surrounding him.
On the human rights portfolio: If the government is sincere in promoting human rights, they should have a portfolio in human rights and the portfolio would be to help improve human rights issues.
Ibrahim Suffian: Director, Merdeka Centre for Opinion Research
We want the new cabinet to carry out what the old cabinet has not successfully done. Clean, new faces who are going to reform the cabinet. A cabinet that will listen to the people and be more approachable.
On downsizing cabinet: It’s really good, we support it. Some portfolios can be merged too.
On Khairy Jamaluddin being a minister: It’s the priority of the prime minister and the ruling party. But as a member of parliament, he has the right to be elected as minister.
V Gayathry: Executive Director, Centre for Independent Journalism
We expect a transparent government, without the old leaders. A progressive cabinet who will not use the old techniques such as the ISA, scare tactics, using ghosts of the past such as the May 13 incident.
We support the putting out of Zainuddin Maidin. The prime minister should get someone to be in tune with technology to keep up with the people’s behaviour and expectations.
The new cabinet should be able to take on the sentiment and the changing demands of the people. More dialogues should be conducted with different communities.
On downsizing cabinet: A lean cabinet is a good sign, the prime minister should cut down on people, get people who will focus on their jobs.
Tan Sri Ramon Navaratnam: President, Transparency International Malaysia
I would like to see ministers with competence and integrity - a proven track record of the highest integrity. Former ministers who have proven their integrity should be retained and new faces who also pass tests of transparency should be brought in.
The cabinet should reflect a mix of experience and youthfulness as the government must think of long-term and establish a good succession plan.
On Khairy Jamaluddin being a minister: If Khairy fulfills the criteria, why not? We should increasingly focus our attention on merit, competence and transparency. If people fulfill the criteria - regardless of who they are - they should be fairly treated.
Dr Chandra Muzaffar, President, International Movement for a Just World (JUST)
Right now, PM must include these considerations - multi-ethnic representation especially from Sabah and Sarawak and the gender factor; more women should be in the cabinet.
Cabinet members should be at least less tainted. Competence is also a major factor - need ministers who can work, plan and execute their plans.
On downsizing cabinet: There’s a need to streamline the cabinet to ensure that there’s no duplication and to improve effectiveness. The Works Ministry, for example, was too wide in scope.
It’s also important for the PM to get someone to assist him in his office and help with the implementation of the various plans.
The PM should also not hold two portfolios. In the last cabinet, in addition to his duties as PM, he was responsible for the Ministry of Finance and the Ministry of Internal Security. These are two heavy cabinet positions. PM should focus on only his PM duties.
On Khairy being a minister: It’s slightly speculative at this point. If Abdullah wants to restore credibility and confidence to his cabinet and if he wants to keep Umno united and wants to make sure everyone is together and cohesive, I don’t think it would be a good idea to appoint Khairy to the cabinet at this point.
Dr Loh Chi Leong: Executive Director, Malaysian Nature Society
I support a mix of old and new blood in the cabinet.
I think it’s more important that the various ministries continue to work more closely with the public and NGO community. - to ensure more transparency
I applauded the formation of the Ministry of Natural Resources and the Environment but a tendency toward "comparmentalisation" has stymied progress. Although good policies have been formulated, cross-sectoral collaboration has not been ideal.
The ministries must improve cooperation between federal and state departments. For example, green lung policies had been approved at the federal level but not enforced at the state level.
Honey Tan: Executive Director, All Women’s Action Society (Awam)
The prime minister should appoint or retain ministers who uphold good governance. This means women and men who believe in and will promise to practice a more participatory form of government, uphold the rule of law, be transparent and responsive, make decisions which are more based on consensus, champion a more equitable distribution of wealth and resources, be efficient and accountable to the rakyat – not the parties to which they belong.
On downsizing cabinet: The women's ministry should remain and stand alone, and not be consolidated with any other ministries or to fall under the Prime Minister's Department as it did in the past. However, having a Women's Ministry does not absolve the government from ensuring that gender main streaming is effectively implemented throughout the other ministries and agencies.
On new women's minister: The new women's minister must get across to everyone that gender equality matters. New minister must also push for CEDAW to be passed into law in Malaysia. It was ratified in 1995, but still not made into law in a holistic manner.
BN government could be brave and innovative. Choose people who may not be from BN component parties. We have capable women from the opposition parties. PM could even appoint someone from the women's movement who have expertise in this area.
On Khairy Jamaluddin being a minister: Any MP who upholds the principle of good governance as laid out above would be an asset to the cabinet and to the country.
