SELF INTEREST

Someone once told me that the word Poli means many and ticks means blood-sucking animal. The solemnity and the scope of what took place with the recent NFC scandal left no doubt in my mind that the word Politics, really means many blood-sucking animal. However, understanding of human behavior not the party is fundamental to comprehend the machinations that formed the current scandal. After all, it is human that breaths life into the party and not vice versa.

David Hume once said, “Man is motivated by and only by self-interest. Only considerations of utility can sway man to act one way or another.” Therefore, you can put any party to run the country but as long as it’s human the quotation will always be relevant. For example, I had recently tried to respond with a comment to an article entitled Call for Parliamentary Select Committee on Defence, which was posted on Tony Pua’s blog. The comments I tried to post were a sincere view of the issue, which was not meant to serve any political agenda or support any individual. Unfortunately, it was not posted on his blog because it does not serve his interest even though my comment may serve the interest of the public. It was not a surprised to me that when I browsed his blog further I stumble upon comments posted which, only supported his agenda but more importantly his interest. The only way to understand why he made such decision is to understand the incentives he face hence his preference for one outcome versus another.

Understanding human behavior also means that whoever is responsible for the NFC scandal should not go unpunished. The tactics of cover up these days are old school. Today people are more upset about government covering up something or saying one thing and doing another. In short, people don’t like the feeling of being lied to and with the case of NFC; this is exactly the feeling of the Malaysian people. Apart from this, the NFC scandal carries cost to reputation, because reputation is much harder to clean than to tarnish. This is why to right this wrong, the government needs to give more than what they think is fair, and it is obvious that the only place to gauge what is fair is by asking and listening to what the Malaysian people think is fair. This is important, as it is a known fact that people judge trustworthy based on the organization’s reputation. It also important to the organization as preserving reputation helps keep honesty and suppresses the incentive to act on bad intentions. In short, punishing wrong-doing keeps people in line and promotes cooperation.

Commonsense insists that people have reasons for what they do and this may be true. But it doesn’t necessarily allow us to predict in advance either what they will do or what their reason will be for doing it. Once they do it, of course, the reasons will appear obvious just like my incidents with trying to post comment on Tony Pua’s blog. We think change is beneficial but it could also be disastrous given the fact that we don’t have the ability to predict the outcome. We have the impression that our particular beliefs are all derived from some overarching philosophy, but the reality is we arrive at them quite independently and often haphazardly. We feel we are so advanced and yet we cannot unravel a simple knot tied by a part time mathematician working alone without a computer – Fermat’s last theorem puts things in perspective. This is why it is not strange that we have the tendency to mistake change for progress.

INFORMATION FALLACY

 Recently, I had stumbled on a blog administered by Member of Parliament Petaling Jaya Utara, Tony Pua (DAP). As I was browsing his blog, I found an article entitled Call for Parliamentary Select Committee on Defence. Being in the industry for more than 15 years, the article incited my interest, as there are many fallacies in its argument. The article quoted Transparency International (TI) score on Malaysia’s defense expenditure well below the failure mark. Director of the International Defence and Security Program for TI in United Kingdom, Mark Pyman was quoted in the article saying, “Malaysia ranked far below other countries (for this), where the budget lacked details and no audits were undertaken of the secret programs.”

Many of us including defence contractor in Malaysia are not familiar with the intricacies of arms deal. I don’t blame them because the kingdom of arms deal revolves around a shadow world. This is the reason why many people like Tony Pua would take Mark Pyman’s comment to be true even if its misleading. They need to know that defense business conducted by countries like US, UK, France, Germany and many others are done in what the industry term as “Grey Market.” This means that the deals are conducted through legal channels but undertaken covertly often utilized by government to have an unlawful impact on foreign policy. This system is in place to obscure information on defense activities made by these governments often to fund illegal activities.

With secrecy de rigueur there are very few arms transaction that are entirely above board. For example, in 2009, UK Ministry of Defense had censored information to conceal an official report from exposing profligacy in defense procurement. Lets look at Canada, the purchase of the new F-35 jets with the cost of USD18 billion without an open competition from aircraft maker. This procurement when done will be Canada’s largest defense procurement in history. Where is the transparency in that deal? Booz Allen Hamilton headquartered in McLean, Virginia was awarded contracts worth more than USD3 billion by the Pentagon and 26% of them with no open bidding process. Where is the transparency in that deal? What about the fact that within a year George W. Bush assuming the presidency, over thirty arms industries executives, consultants and lobbyist occupied senior position in his administration. Half a dozen of those senior executives are from Lockheed Martin and they were given crucial position in his administration. As a result of that, the company was awarded by Pentagon the biggest Military contract in US history.

Therefore, “The budget lacked details and no audits were undertaken of the secret programs,” echoes the overall tone of any report that attempts to scrutinize arms transactions. These countries have a defense budget larger than the total budget of Malaysia and much larger interest in foreign policy of the world. The only way to pursue their policy goal is by keeping their defence transaction in the “Grey Market” area. I don’t see how these countries would be any better than Malaysia when it comes to being transparent in their defense expenditure. Ronald Reagan once said, “Trust but verify.” My advice to all of you is to do the same especially on matters regarding defense related issues.