Subsidy in Malaysia

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There is an ongoing effort of the Malaysian government to reduce subsidy for food and petrol. They have been pitching the argument that it's getting costly to do so, especially petrol, and that they need the money for development of the country.

I used to believe this should be the right approach based on economics. Otherwise, the market price is distorted and thus causing inefficiency.

However, now I rather have those subsidies directly benefiting all Malaysians than to have them reduced with savings in the hands of the government. Why? Simply because I don't trust the government to channel the savings entirely for the good of the people and I bet I'm hardly alone in thinking this way.

Comments

William said…
If they take you into custody, you can't even trust them with your life.
May 31, 2011 at 10:47 PM
MrBunnyBan said…
They need the money to fund their costs campaigning for GE. Apparently they spent a bucketload on the last by elections.
June 1, 2011 at 2:59 AM
Jaded Jeremy said…
Ban,
They can't be trusted.
June 1, 2011 at 11:04 AM
Anonymous said…
Regardless, subsidies should be for necessities, and petrol is not one. Those who can afford cars, should be able to afford petrol. Public tranz is available. sr
June 5, 2011 at 1:25 PM
Jaded Jeremy said…
sr,
I don't trust the government enough to even let go of subsidy on petrol. Also, public transport is barely a viable choice in KL and certainly hardly a viable one outside KL for the long term, given its current state.
June 8, 2011 at 12:17 PM
Anonymous said…
Yeah, too bad. When there I had to take buses + lots of cabs & that can be costly. Nothing like S'pore. I never could understand why S'poreans need to own cars. sr
June 9, 2011 at 12:55 PM
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