Saturday, October 4, 2014

Thailand's political future – The Changing of the garb

THE top generals have swapped their uniforms for civilian dress, some four months after toppling Thailand’s electoral democracy in a coup d’état. On September 30th, the coup leader and prime minister, Prayuth Chan-ocha (looking natty in blue, pictured), stepped down from his position as army chief. His successor, General Udomdej Sitabutr, has assured Mr Chan-ocha that the army will not oust his brand-new government with a military counter-coup. It almost went without saying that General Sitabutr will do everything in his power to protect the monarchy.

Thailand’s political future is still up in the air.

To survey predictions for the duration of military rule is to hear estimates ranging from one year to indefinite. The overall direction will become clearer once the civilian-styled former generals draw up a replacement for the constitution they shredded. They have already handpicked a 250-member panel to draft a new document within 120 days—and with it, to devise political reforms for the country’s broken political system. The idea is to repair the whole thing from the top down. Thailand’s new rulers have been candid: they intend to prevent the reinstatement of the winner-takes-it-all system that allowed the party of Thaksin Shinawatra, a telecoms tycoon who became a populist prime minister, to win every election held since 2001.

The king was supposed to appoint the members of the panel on October 2nd.The body will consist of one representative from each of Thailand’s 77 provinces, plus and 173 people from eleven “subject areas” specified in a retrograde interim constitution. Those subject areas range from politics and public administration to the economy and civil society. The make-up of the panel shows that those who disagree with the current political order will find no place in it. The nature of the political reforms they are to dream up remains a mystery. Whether Thailand’s self-appointed rulers wish to subject the new constitution to a popular referendum remains unclear. 

Thailand’s politicians have been kept out of the process of “political reform”. Most of them have agreed to refrain from political activity following a brief “attitude-adjustment” programme the junta administered to them in the week after the coup. Suthep Thaugsuban, the leader of the triumphant mob, which had set out to oust the government of Yingluck Shinawatra, has sidestepped public life to become a monk. Abhisit Vejjajiva, the leader of the main pro-establishment Democrat Party, continues to give the occasional bland statement. Ms Yingluck appears to be going about her life quietly. And her brother Thaksin has been watching Thailand’s new political order take shape haplessly, from his exile in Dubai.

The Thai military and business elites have traditionally scorned the elected politicians as a venal lot, the sort who promote their own personal status with little regard for the welfare of the kingdom. It is typical of Thai elites to cast populist policies as corrupt. The Bank of Thailand is perhaps one of the few central banks to keep money supply unchanged even as GDP growth plunges to zero. It has kept money supply unchanged since end-2013—a remarkably irresponsible act. The Fiscal Policy Office, the finance ministry’s think-tank, is drafting a monetary and fiscal package designed to control populist policies. (It might yet find its goals undercut: on October 1st the government sanctioned a $11 billion stimulus package to help farmers and create jobs. In essence it is a cash transfer to farmers, an expensive sop offered with the hope that it might revive the listless economy.)

As is the case throughout much of South-East Asia, the power elite in Thailand does not accept the fundamental nature of democracy. They believe that the rule of an “accomplished” few is preferable to the judgments of the people.

So what might their new rules look like? There is a strong expectation that the junta may put restrictions on voting. The idea is popular among some circles in Bangkok, where people have long grumbled that their votes do not count more than those of poor and uneducated farmers. But junking universal suffrage outright would probably be hard to get away with. A more likely path is a partly appointed parliament. That would leave those with the power to appoint—the monarch, the army and the bureaucracy—to retain control over the balance of power. At the same time, power might be shifted further away from parliament, into the hands of appointed regulatory groups. All such “reforms” would be likely to meet the scorn of Thailand’s silenced majority, as well as that of university professors and intellectuals, and some foreign governments. 

The streets of Bangkok are calm these days.  The only reminder that anyone is resentful about being governed by unelected leaders is the image of the protests in Hong Kong, which has been splashed across the front page of Thai newspapers. The same papers have also reported the results of a recent poll which shows that 90% of Thais are either “satisfied” or “very satisfied” with the junta’s performance. (How would you answer if the army asked how you like their rule?) However doubtful the poll results, many people do seem prepared to let the junta try improving governance and reboot the political system. The same people are uncertain whether it will be successful. The dissenters are keeping quiet but there are a large number of unhappy people from all parts of the political spectrum. Arbitrary power is arbitrary power, and Thais do not remember it fondly.

The only way the army can get away with its dictatorship is if it embarks urgently on the only reliable path to political stability in Thailand: a policy to redistribute wealth in ways that stimulate growth and draw the whole population into the modernisation process. This is the path that will make most Thais happy. It also happens to be the only way in which the junta can justify an extended period of acting as the sole caretaker of a broken system.

The junta’s rule is likely to go on for a while, if for no other reason than that its members cannot bear even the thought of the politicians being in charge when the king dies. It helps that the bureaucracy and most of the wealthiest Thai families back the military government. These rich Chinese-Thai families, along with the Thai elites, control much of the country’s assets. In the course of the 20th century a small group courtiers and businessmen have played their cards right with the monarchy and managed to join them. The result is that 0.1% of Thais own half the nation’s assets, a concentration of wealth that makes America’s mind-bogglingly unequal wealth distribution (where 0.1% of citizens own 22%) look like a socialist dream come true. 

These very wealthy families crave control and stability above all, not the sort of rapid economic growth that raises living standards for all. So it has always been in their rational interest to support conservative governments. Badly burned in the economic collapse of 1996 and 1997, they fear permanent shifts in government policy, competition and a rising price of access to capital, labour and land. Many saw the rise of the Shinawatras as an immediate threat to their own status, if not their wealth.

The current lot of generals must have noticed that as the only guarantors to the moneyed establishment they find themselves in a good bargaining position. They might as well raise their price for having re-established peace and order—and so they are considering a tax on land and inherited wealth. That is surely not populism, but it might not feel so different to some people.

By Banyan for The Economist

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