The economy will figure prominently in the general election

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There is near universal agreement among Pakatan Harapan supporters that the system does not work. We don’t need a wise man to tell us that a majority of the population is dissatisfied with the way things are going in the country.

Why have the last two governments had so much trouble implementing the right economic policies?

With general elections expected to take place soon, the government is expected to try to revive the economy as the economic conditions are having a powerful impact on voters.

So-called political economic cycles create ups and downs in economic activity around elections, and the perceived state of the economy has been shown to influence voting decisions.

Malaysians will see the emergence of new parties that are markedly different in their ideological stances and populist discourses.

Voters will look at the national economic situation and their own financial situation.

It looks like the next GE will be fought through the prism of a struggling economy. And economic trends are likely to determine the shape of the PH, Barisan Nasional and Perikatan Nasional coalitions.

People are likely to support a combination of budget cuts and tax increases, but only for the wealthy.

In short, they want the economy fixed but are unwilling to make the sacrifices necessary to make it happen.

During its first term in 2018, the PH administration cut federal spending, which spooked some voters.

It didn’t help that Umno turned the austerity campaign into multi-racial coalition efforts to wrest the rights of the majority race in the country.

Struggling between economic decision-making and political reality, PH was unceremoniously dumped by one of its partners, which led to the ousting of the coalition.

In order for the country to be safely out of its current situation, whoever governs the country next will have to introduce a “fiscal cliff” of tax hikes and spending cuts, which, of course, will cause the economy to collapse. already weak.

As an incumbent, it’s obvious the prime minister and Umno/BN will be able to articulate more specific economic plans, if only because Ismail Sabri Yaakob is due to present next year’s budget to parliament. in October.

As a challenger, PH’s proposals will likely be less specific.

Given the precarious nature of the country’s finances, it is highly likely that PH’s approach to public spending is driven by a belief in the economic efficiency of public spending as a means of reviving the economy.

As we’ve seen for a few years now, the world is changing – and the changes won’t stop when the pandemic is finally over.

Political tensions in other parts of the world will affect us directly, more than ever. Politics is no longer local.

Governments, under pressure from their people, have diverted resources from other countries, banned the export of food and medicine, and hoarded essential supplies. Each of these measures costs other countries.

Take, for example, the supply chain disruptions caused by the war in Ukraine. Many experts predict that they will decrease by the end of the year, and this could be true in the short term.

But in reality, supply chains are just the beginning of a long-term fundamental change.

The push for higher environmental, social and governance standards means a profound shift in the way businesses across the country operate, now and in the near future.

In the face of this, better education and competition policy will determine whether the country will be able to overcome its current obstacles and the anticipated headwinds that will come our way.

And PH was clearly aware during his two years in Putrajaya that there is always strong public resistance to cuts to government-funded benefit programs and that maintaining benefits is more important than cutting the deficit. .

If the PH were to heed lessons learned, it would focus solely on streamlining government without controlling federal spending if re-elected.

Policies must be structured taking into account political realities.

Explain to voters that if PH succeeds, other ASEAN countries will face a rejuvenated competitor.

If it fails, the resulting slowdown in growth and rising debt burden could hamper the country’s economic recovery for years to come.

Shifting voters might shift loyalties in response to an incumbent’s policies or a challenger’s promises.

Where are these swing voters? The young people who will vote for the first time? What about the disenfranchised supporters on the other side? – August 4, 2022.

*FLK reads the Malaysian Insight.

* This is the opinion of the author or publication and does not necessarily represent the views of The Malaysian Insight. The article may be edited for brevity and clarity.

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