Tuesday, February 28, 2006

Petrol Price Up Up Up

Yup... everyone's blogging about it. Petrol price skyrocketed overnight. 30 cents per liter. That means it will cost about RM70 to fully fill up the fuel tank in my humble Proton Iswara. Several years ago RM50 was all it took. Read it on bernama's website.

Last year the government erected huge billboards to inform everyone how much subsidy they are giving out for every liter of petrol (they're going to spend additional money to change the billboards now!). I'm not sure if the purpose of the billboards is to make you the rakyat feel guilt over the subsidy or to show the rakyat what a benevolent entity the government is. Either way it doesn't work because of one simple fact. Ask yourself this... where does the money for subsidies come from? Yes. A big part of the government's funds are raised from taxes (for those who find all kinds of excuses to NOT pay tax please don't complain about the fuel rise... you are contributing to the problem) and taxes come from your pocket.

Unfortunately it is also a problem that the price of crude oil around the world is rising. Fortunately for us we have something called Petronas; a 100% goverment owned petroluem company. Simple deduction tells us that when crude oil price goes up, Petronas earns more money. Plain and simple right? So what has happened to the increase in revenues from Petronas? Whatever it's being used for it's definitely not being used to cushion the impact of oil prices to the rakyat.

We have a government that likes to make illogical benchmark comparisons often with rural African countries. This time around, to justify the price hike they made comparisons to Asean countries which I must applaud because the comparison sounds justified... except why do we want to compare in the first place? I'm not sure if there's a single person who will be convinced by the comparison argument. I mean if one day your roti canai stall proprietor tells you "Boss, Roti Canai hari ini naik harga 30 sen... tapi jangan marah... Singapura lagi mahal", what would you be thinking? Personally, what do I care if Singapore has pricier Roti Canai. What I know is MY Roti Canai is going to be more expensive. What the rakyat is interested in knowing is how come our petrol prices are not as low as Brunei's.

I think we need to ask ourselves why the goverment cannot afford to absorb the rising fuel costs. I'm guessing it is because of the targeted budget deficit of 3.5%. But the bigger question to ask ourselves is how come we are facing a deficit? Could it be because of the billions we waste in repairing shoddily constructed facilities? Could it be the billions of ringgit paid for white elephant projects? Could it be the rampant corruption that jacks up prices of major public projects? I'm so very tempted to answer yes to all the questions but I don't have the facts. I'll just assume that I have asked the right questions... what do you think?

There's more to write but I've got to prepare for work so I'll stop right here. Wishing everyone improved mileage in their vehicles :)

posted by wyejon at Tuesday, February 28, 2006 (permalink) |

10 wise words from our readers:

a golden opinion from Anonymous Anonymous

All of this are quite valid but Malaysians also like to complain that not enough money is being spent on public transport and what have you. Where to get the money? From money that has been wasted so people can drive alot. The government can't subsidies fuel forever and when fuel subsidies is completedly abolished I will be a happy bunny.

7:35 AM  

a golden opinion from Blogger MoonCake

The always like to make those "IDIOTIC" comparison. Either they compare to those rural contries or those well develop country with very Strong currency value. No one will ever be convinced by this kind of stupid comparision other than those stupid asshole gov.

9:19 AM  

a golden opinion from Anonymous Sadum

I think the goverment should try to absorb the rising fuel price. It's the people's money anyway that are being used (thru tax revenue). About the 'idiotic' comparison, yeah, sometimes our good leaders do make crazy analysis comparing thing by it's weight and value. They should have make judgement thru ratio comparison (for example, basic income against the percentage one needs to spend for a particular item, etc), not just blindly take a bunch of figure and compare with other figures. Or why not just raise our currency rates to minimize the fuel hike effect on our power to purchase (that would probably would affect Petronas' income, but what's the problem anyway? I don't see any good thing happen yet with Petronas taking advantage of this fuel price situation).

4:21 PM  

a golden opinion from Blogger wyejon

anonymous: How about reducing wastage and defeating corruption? I bet we could recover billions if we did that. I do support and efficient public transport system but to be realistic we are not going to get it here. The towns are too badly planned.

sadum: I'm really unhappy about the way the government is trying to "korek" so much money out of the rakyat. Go fix your own leaks first then only bother us.

10:41 PM  

a golden opinion from Anonymous Ben

The current administration's fiscal policy is whacked, we had barely recover from a recession and they are placing strict inflationary measures that could severely stifle growth. I have no idea where the hell the "3.5%" deficit objective comes from, its a lame and misguided goal. The American deficit is far higher, so is China. There's a strong believe in marcoeconomics that government's debt is good. Somebody should tell that to our financial advisors.

The current administration is full of puzzling paradox. At one moment, they claim the economy is not facing an inflation - the next minute they jack up loan and saving interest rate and hike energy price when crude price is falling. At one moment, they claim they wanna reshape public service with KPIs and Performance-linked Compensation - the next minute they pay COLA and large bonus to ALL civil servant.

2:09 PM  

a golden opinion from Blogger Dragon City

look what i found on TheStar website..

Najib said "Such changes in lifestyle should be made so that even if there were increases in fuel prices, Malaysians will be able to continue having the good quality and comforts of life which they have been enjoying"

What the fuck !! He should be doing something for us and not ask us to change our lifestyle..

Look like government nowaday doesn't do much thing for us already...they only talk talk talk and do nothing..

1:31 AM  

a golden opinion from Blogger MoonCake

So guys out there, should know what to do in the next election ? Never ever vote for BN as they always give false hope to us ! That bunch of bastard will always break their promise after they win in the election...

2:42 PM  

a golden opinion from Anonymous alice

my economic lecturer told us, maybe we could come to coll'school only for 2 days,8am to 8pm. whole day, save petrol,the rest of the days,stay at home,don go out for movies or shopping. don go travelling. the mas and air asia is offering cheap packages but dont take it and matta fair is coming up, will see how is the response. save money, that's what the govt wants us to do. by doing so, comsumption decreases, economy will slow down, and more unemployment rate will lead to more social problems. stupid. maybe we should consider migrating to other countries. look at those ministers, they are getting fatter and fatter, the body size and the wallet only. not knowledge. some can't even speak proper English. how shameful.

11:20 AM  

a golden opinion from Blogger wyejon

ben: not sure if having a deficit is such a good thing... look at how much in debt the US is in and it's not that great a situation to be in... but then again I'm no expert in economy.

dragon city: Well our DPM will still be happily being driven around in his government sponsored car that's running on government sponsored petrol driven by his government sponsored driver. Cakap tak serupa bikin.

mooncake: It's a stroke of genius how in our last election the former PM made it possible for BN to gain the biggest majority it has ever had... well I hope the rakyat are not so easily fooled the next time.

alice: the government is funny... they increase the price of an essential good and expect no one to increase their prices... but anyway don't boycott private enterprises... they're not at fault.

7:30 PM  

a golden opinion from Anonymous Ben

Controlled deficit is a good thing. If you observe the American economy for the past couple of years, while its true the American government has gotten poorer..at the same time American corporations are making record high profit level.

But then again, it really depends whether if you are a socialist or capitalist. If you are a capitalist, you would believe that as the private sector becomes richer, wealth can be more effectively distributed to the people via creation of new jobs, salary increment, new investment, bla bla. If you are a socialist, company owners are probably just a bunch of greedy pigs..and the government should probably control most of the wealth and pass it along to the poor via welfare. If you are a realist, you would know that unless you have a tax consultant in the Canaries, and a bank account in Swiss, and you get invited to Davos...you're probably being screwed by corrupted government official and greedy corporate fat-cat and there's nothing much you can do about it.

10:04 PM  

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