Fuel Price Hike

This is probably the biggest news since the end of elections. Petrol prices in Malaysia had risen by 78 sen/per liter and the problems would be more than just cars. Stan will attempt to comment on this issue using a little of his noobish and horrendous economics knowledge..lol (so do forgive him if he makes some noob mistakes in analysis..haha) But mostly it would be sociological lar..

The common citizen would complain that the govt is bloodsucking with such a sudden increase but they have to see that sooner or later, petrol subsidies would have to be removed. Continuous subsidies would plunge Malaysia's budget deficit into a dangerous level and that won't be good for the economy in long run. Besides, prolonged subsidies also encourages some wasteful habits from the citizens. BUT now that subsidies are being pulled out, the federal government would probably have some additional funds and history don't look very kindly on the BN where these funds would either end up as rasuah, useless projects or inefficient policies. Anyways, great job by Tony Pua in critically analyzing the situation using economics instead of blind outright opposition.

Closely related to the petrol hike is on the state of public transportation in the country. Poor public transport services meant that people don't really have much choice but to continue using their cars as means of transportation even for short distances. KTM trains arrive at irregular intervals, taxis that charge their customers at ridiculous rate and buses that are maintained poorly are some of the persistent problems.

From a common citizen's point of perspective, it's gonna be some hard days ahead no matter how bad or how good the reasons are for the sudden price hike. Stuff like electricity, water and certain daily necessities would increase in addition to soaring food prices. The common citizen ain't gonna be speaking Economics. They are looking at the end-result and what is directly affecting them. And this brings to the question whether such a move is one of the political suicide actions taken by the Badawi administration.

Already deep in trouble internally within the party, the basis of Badawi's hold in power is further corroded as all sections of Malaysian community (including Dr. M's camp) heaped more criticisms on the PM. Massive scenes of chaos and panic are reported around the petrol stations in the country even before the announcement of the price hike. The quick implementation and withdrawal of the foreign ban on petrol reveals the fickle-mindedness of policy makers in the government. These are the issues that provide free ammunition for the anti-Pak Lah camp. Reactions are coming in thick and fast in all sorts of media. It would be interesting to see how far the reactions (be it physical or virtual protest) would go.