Army chief’s challenge continues
Written by Writer on Saturday, November 8th, 2008
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Army chief’s challenge continues
Thai society is waiting to see Gen Anupong Paojinda’s reaction to the latest moves by the backers of the former prime minister, said MATICHON daily
KAMOL HENGKIETISAK
Gen Anupong
Last Saturday’s mobile “Truth Today” program was held at Rajmangala Stadium, with nearly a hundred thousand red-shirted loyalists of former prime minister Thaksin Shinawatra in attendance. The highlight of the program was a live phone-in by Thaksin himself, noted a Matichon writer.
Mr Thaksin criticised the Thai judiciary system as being unjust, indicating that he did not accept the Supreme Court’s verdict jailing him for two years for breaching a provision in the National Anti-Corruption Commission (NACC) in the Ratchada land sale to his wife Khunying Potjaman Shinawatra.
He left a political bomb by remarking: “No one could bring me back to Thailand [to face jail time] except by His Majesty’s kindness or the power of the people.”
The live phone-in address posed a question as to what Thaksin’s real motives are, because his many moves and comments contradicted his pledge that “I have quit politics,” uttered when he exiled himself to London after the September 2006 coup.
By involving the monarchy in his political struggle, Thaksin risks his remarks being interpreted in several ways. At present, the institution of the monarchy is being constantly challenged in media by people who are believed to be Thaksin loyalists.
Since the chiefs of the armed forces have claimed all along that they are soldiers of His Majesty the King, it may be asked what role would they be expected to play to protect the monarchy, which is constantly being challenged?
The military’s power was at its peak during the 2006 coup, when Gen Sonthi Boonyaratkalin was army chief. When Gen Sonthi retired last year and Gen Anupong Paojinda was promoted to the top position, the armed forces consider him as their leader and spokesman.
All along Gen Anupong has remarked that political problems must be solved through political means and he has refused to mobilise the armed forces even when given a chance during the emergency declaration in Bangkok by former prime minister Samak Sundaravej.
When there was a political strife between the supporters of People’s Alliance for Democracy (PAD) and the PPP-led coalition government, Gen Anupong pledged that he would not stage a coup because he didn’t believe that would resolve the political conflicts.
When Gen Anupong’s words began to sink in, PPP politicians became more daring and dared to defy the military. This could be seen, said Matichon, when Prime Minister Somchai Wongsawat did not heed Gen Anupong’s open suggestion on TV that Mr Somchai should resign to take responsibility for the police crackdown on the on-going PAD demonstrations on October 7, resulting in deaths and injuries.
Instead, Mr Somchai neither resigned nor dissolved the parliament, telling the public that he had important tasks to perform. He also suggested that a new constitution must be drawn up before he would dissolve the House.
However, Gen Anupong’s influence was not totally lost. When he called on the police to enforce the law to close websites that attack the monarchy and arrest the those involved, his call was backed by Mr Somchai and the police immediately took action and closed the offending websites.
Gen Anupong has said the phone-in incident is troubling, and he expressed concern about Mr Thaksin’s remark about a royal pardon and his call for his supporters to make it possible for him to return to Thailand without facing a jail term. Gen Anupong was worried that there might be violence if political forces tried to involve the monarchy in their political struggles.
Now that the PPP has mobilised its red shirts - the National United Front of Democracy Against Dictatorship (UDD) - force to counter the PAD, society is waiting to see how Gen Anupong reacts in trying to keep the peace in an increasingly divided Thai society, concluded Matichon.
All is not lost
The Somchai Wongsawat administration proposal to carry out commodity price support scheme for paddy, corn and tapioca was welcomed by a Thai Rath writer.
The cabinet on Tuesday approved the commodity pledging scheme worth 110 billion baht this year, with the Bank for Agriculture and Agricultural Cooperatives tasked to carry it out. The BAAC will get 40 billion baht each from Krung Thai Bank and Government Savings Bank, while Thai Military Bank and Siam City Bank will chip in with 15 billion baht each.
The Finance Ministry’s Public Debt Management Office will borrow the money from these 4 government-owned banks by issuing a one-year commercial paper with Finance Ministry acting as guarantor for both principal and interest. Since there is no risk, the four banks will charge a very low interest for the borrowed principal. The money will be given to the BAAC to be used to administer the scheme.
In the past, the commodity pledging scheme was often carried out by the Commerce Ministry’s Public Warehouse Organisation, which used government budget to buy commodities at high prices and sell low, with corruption at practically every step, resulting in huge losses of tax-payer money.
Thai Rath approved of the BAAC being assigned to carry out the task. The bank has a widespread network and has been closely involved with farmers for many decades, and thus can handle the scheme easily.
This is a win-win situation, as farmers can get higher prices while the BAAC does not have to shoulder any loss. The four government-owned banks also get a profit from the interest charged, without facing any risk.
If commodity prices rise in the future, the government can sell the pledged stocks at a profit. If the price does not rise or decline, the government suffers a small loss from paying interest and the price differential.
Such a commodity price pledging scheme with no corruption can be said to benefit the country even if the government suffers some loss. The Thai Rath writer cited His Majesty the King’s remark that “loss is profit” as applying to this case. The government may suffer a little loss, but farmers can make a tidy profit throughout the country, which then generates further spending and investment, the so-called multiplier effect many times over. Eventually, the generated economic activities can benefit the government with increased tax revenue.
The writer praised the Somchai government for trying to implement a commodity price support scheme with transparency for the first time in decades. He hoped that other cabinet ministers would take heed, but was unconvinced that would be the case. At present the price of steel has declined nearly 50%, yet some ministers still propose increasing construction budgets for several projects, citing rising construction material costs.
Caution about stimulus package
The US financial meltdown affects all countries in the world, including Thailand, noted Varakorn Samkoses, a Matichon writer. The administration of Somchai Wongsawat plans to spend another 100 billion baht to supplement next year’s budget of 1.85 trillion baht to create jobs and supplement rural incomes,
Apart from the extra fiscal stimulus package, the government will accelerate mega-projects such as subway lines in Bangkok worth altogether 1.8 trillion baht within the next 3 years. If the government cannot borrow 100 billion baht in time, the Finance Ministry’s central fund will be drawn down to the tune of 50 billion baht.
Mr Varakorn remarked that any Thai economist worth his/her salt would feel a chill wind upon learning such a huge sum of money is to be spent. He remarked that even though the government considers it necessary to spend 100 billion baht to cope with the upcoming recession, this will be a burden on the government as it has to pay a lot of interest, raising the already high public debt, which presently stands at 2.82 trillion baht, or about 30% of GDP.
The House of Representatives will adjourn on November 28, so the 100 billion baht supplementary budget cannot be considered in time for this session. It will have to be submitted in early February next year and will have to pass various procedures before being approved. It is expected that the money will be available in May next year, just five months until October, the end of the fiscal year.
Since it will take time for the approval of the supplementary budget, the government has proposed using 50 billion baht from the Finance Ministry’s central fund first. However, pointed out Mr Varakorn, the central fund is important as an emergency fund in case tax collection falls short or there are natural disasters which need urgent attention to alleviate suffering. At the end of September 2008, the central fund held about 142 billion baht.
Mr Varakorn argued that the central fund should be used only for the utmost emergencies, and not spent recklessly to stimulate the economy when the country is not sure about its tax revenue collection.
He also argued that the economic recession may not require a stimulus package. Mr Varakorn advocated helping SMEs by reducing their costs, helping with credit, finding markets and offering tax incentives. These measures would help promote employment in a productive sector and do more good than creating unnecessary jobs in the rural areas which risk facing leakages from corruption along the way.
A supplementary budget will be good to the country only when it is spent constructively, to raise the country’s competitiveness, and not spent wastefully.
Bangkok Post
Saturday November 08, 2008
