REPORTER: Ginny Stein
This is Thailand, where cool hearts, social calm and respect for authority are considered the finest values to aspire to. But that highly sought-after quiet reserve, is about to be challenged by the arrival of one man.
WOMAN (Translation): I just touched the Prime Minister's hand.
By this welcome you could be excused for thinking he's a rock star, but this is Thaksin Shinawatra, Thailand's Prime Minister.
THAKSIN SHINAWATRA, THAILAND PRIME MINISTER (Translation): Good luck, I wish everyone happiness.
WOMAN (Translation): Hello, Can I touch your hand. I wish you happiness for the New Year.
THAKSIN SHINAWATRA (Translation): Hello, hello.
WOMEN (Translation): I wish that you Prime Minister are always able to solve the problems. Please put it over your head. You look very cute.
This is the birthplace of Thailand's most powerful man. And today Thaksin Shinawatra has returned to the northern city of Chiang Mai to preside over a Buddhist ceremony marking the start of the Thai New Year.
This Prime Minister has done what no other before him has ever achieved - a second term in office and a hold on power almost without challenge.
WOMAN, (Translation): Im so happy that hes here today. I wish him happiness and longevity. So Im happy to meet him, Ive never met him before.
To many, Thaksin Shinawatra is the man with the Midas touch. He came to politics after making a fortune of US$2 billion flogging computers to the police department.
In 2001, this former police colonel-turned-businessman was elected Prime Minister in a landslide result. And unashamedly, he soon set himself a timetable to take Thailand into the first world by running the country like a company.
In Thailand, being rich is considered a virtue, being very rich is practically godly, and being next to Thaksin, well, there's always hope that some of that will rub off.
The Prime Minister's dynamic, hands-on style has won him a loyal following, particularly amongst Thailand's majority rural population.
MAN, (Translation): Yes I like Mr Thaksin, he always makes sharp, quick decisions. Hes decisive and prompt to fix any problems and this is what people like. And he has thought up a long-term plan. I like him.
But Thaksin Shinawatra is not without his critics, notably those who condemn his lethal crackdown on drugs, his handling of the upsurge of separatist violence in the country's south and his family's business success since he took office.
SULAK SIVARAKSA, SOCIAL CRITIC: He has the ability of a commercial man. He can sell and I thought and many of us thought that he has enough money, he won't be corrupted so we gave him a chance.
Sulak Sivaraksa is a leading Buddhist scholar and social critic who's been disillusioned by Thaksin's rule. Tonight he's celebrating his sixth cycle birthday - an auspicious occasion in the Buddhist calendar. A group of artists and puppeteers is putting on a performance in his honour and the chief protagonist is none other than Thaksin Shinawatra.
PUPPET SHOW, (Translation): Im so happy and I want to celebrate with some wine. 100,000 baht per bottle, such a fine wine! And I drink this wine every single day, or every Saturday before going out to meet my people and lie to them.
Thaksin has Chinese ancestry, and this is how Sulak Sivaraksa explains the PM's brash style.
SULAK SIVARAKSA: Well, I suppose you would say a clash of culture but of course I don't want to make racism, you know. He claim to be Thai, he claim to be Buddhist, but in the Thai culture, you know, the strength and weakness of Thai culture, you don't push straight, you don't hurt people's feelings unnecessarily, you know.
We have have the word 'kreng jai', you see? And have to 'jai yen' - cool heart. He has none of this.
Back at the puppet show, the leader of a mythical kingdom is being praised for the lethal success of his war against drugs.
PUPPET SHOW, (Translation): Police Lieutenant General Jaksin Nation-Eater has governed this country for four years. He has beaten, imprisoned and ordered the killing of over 3,000 people, an outstanding achievement.
A nationwide crackdown on the drug trade, which began soon after Thaksin was elected to office, resulted in the killing of more than 2,500 people. The Prime Minister had given explicit orders to crack down hard.
REPORTER: Prime Minister what do you wish Thailand for a Happy New Year? What would make Thailand a happy place in your mind?
THAKSIN SHINAWATRA: Well, peace. Peace, everywhere all of the people in the world love peace. OK. So peace. After peace is prosperity.
But now a new war is on its way.
REPORTER: Prime Minister, you said peace. You announced yesterday your war on drugs Mark III. There are a lot of people who died in the first wars, is this one going to be different?
THAKSIN SHINAWATRA: It is totally different.
REPORTER: How?
THAKSIN SHINAWATRA: Peace and the drug suppression is totally different.
REPORTER: But a lot of people died in the drug suppression?
THAKSIN SHINAWATRA: That's because of the cult of killing among those drug traffickers and also there might be extraordinary, but it's not much, we do the investigation.
No-one has been brought to account for the more than 1,000 apparent extrajudicial killings. Thaksin Shinawatra believes he has time on his side.
THAKSIN SHINAWATRA: We can prosecute them, for those who commit crime, in 20 years so it's plenty of time. Don't worry.
But these killings seemed to have caused little alarm amongst Thailand's voting public when they went to the polls earlier this year. Thaksin Shinawatra is now the most powerful elected leader Thailand has ever had.
ABHISIT VEJJAJIVA OPPOSITION LEADER DEMOCRAT PARTY: Well, he now has 377 seats in a 500-member house so he has a comfortable majority.
Abhisit Vejjajiva leads the opposition Democrat Party.
REPORTER: You're talking about a very powerful man?
ABHISIT VEJJAJIVA: Yes, and I think he's not been hesitant at all in using that power the way that he wants to. So that it's not just a question of the lower house but also the way he deals with the bureaucracy, the way he deals with the media in Thailand. He's really amassing a lot of political power and wealth.
Dateline tried for months to gain an interview with the Prime Minister without success. We were eventually told he does not give exclusive interviews to the foreign media.
Suranand Vejjajiva, the Prime Minister's right-hand man, was nominated to speak in his place. He's worked for the Prime Minister for almost a decade, and made the move with him from business to politics.
SURANAND VEJJAJIVA: Minister to the Prime Minister: He's a very decisive man. He knows what he wants. He knows what to do. Of course he's been successful, a successful businessman, and he was a policeman, so in a way he understands Thai bureaucracy, in a way he understands modern management, he understands what globalisation means and what it means to Thailand.
Now his critics say power has gone to his head, allegations about the Thaksin's family business connections just won't go away.
Five of Thailand's six television stations are state or military owned. The sixth, is controlled by the Shin Corporation, the conglomerate Thaksin Shinawatra founded, which is now worth US$2.5 billion, and with interests ranging from mobile phones to satellites and the Internet.
REPORTER: The research that you have carried out has looked into wealth generated by political connection. Who is getting rich?
SOMKIAT TANGKITVANICH, THAILAND DEVELOPMENT RESEARCH INSTITUTE: It is very narrow. Only five companies. And all of them are related with the Prime Minister's family.
Economic analyst Somkiat Tangkitvanich, from the respected independent Thailand Development and Research Institute, has been studying the stock market and the performance of Thai companies since the Prime Minister won office.
REPORTER: So the five companies that are doing extremely well in Thailand?
SOMKIAT TANGKITVANICH: Out perform the rest of the stock market.
REPORTER: By how much?
SOMKIAT TANGKITVANICH: By 141 percentage points.
The performance of companies connected to Thaksin has now become a major issue in Thailand, with allegations not only of conflict of interest, but also attempts to muzzle the press.
In this Bangkok hotel, journalists, politicians and academics have united to declare support for one young woman who's taking on the most powerful family in town.
SUPINYA KLANGNARONG, CAMPAIGN FOR POPULAR MEDIA COMMITTEE: Maybe they support me personally but I think most of the people who support this event today I think they support press freedom and I think the right of people in Thailand to fight against, how to say, the injustice.
Media advocate Supinya Klangnarong is being sued by one of Thaksin's family companies for daring to say publicly what was obvious from the stock market - that the Prime Minister's family-run business empire has done very nicely in the past few years.
REPORTER: Do you stick by it? Is it true, can you prove it?
SUPINYA KLANGNARONG: Of course, what I said is mainly based on fact. Fact one is that Shin Corporation getting...they got more profit, that's a fact. And they got also more income, also that's a fact. And all the business that they have done, just like TV, satellite, that's a fact.
And the government enacted many law and policy involving in the media, that's a fact.
But Supinya went further - she accused the company of using its profits to enhance the fortunes of Thaksin's political party.
In this David-and-Goliath battle Supinya Klangnarong is facing jail and a compensation claim for libel worth 2,500 times her annual salary.
SUPINYA KLANGNARONG: So they are asking for US$10 million. So if I lose the case, I have to pay. If I don't have money, they will declare me as a bankrupt person. So for me it would be no problem, but it will be high risk for the media agency, just like the newspaper company so that why this is not good to intimidate the media agency or media company.
While these claims have been widely reported elsewhere in Thailand, Supinya Klangnarong alone appears to have been singled out. The government maintains the Thaksin family companies are simply benefiting, like everyone else, from the government's good handling of the economy.
SURANAND VEJJAJIVA: If what she said is a fact, the judges will tell her it is a fact and then it will rule in her favour.
REPORTER: But what message does that send to the media in Thailand?
SURANAND VEJJAJIVA: Come on, every media have their own accountability and responsibility, you can say anything. Everybody always say free media, every interview - even what I am doing now I can say what I want. But it should not impede on other peoples rights and liberties, right?
So if it does and she gets sued by it, If someone feel that they are being offended or being...it's wrong and she gets sued, that's the Western process, that's the Western justice process. Same here.
REPORTER: It doesn't look good for the Prime Minister?
SURANAND VEJJAJIVA: It's not the Prime Minister suing.
REPORTER: It's his family company.
SURANAND VEJJAJIVA: Come on, even if the Prime Minister sues so what, if the Prime Minister feels that he is being wrongly accused?
The Thaksin family is now the wealthiest family in all of Thailand, according to shares held on the Stock Exchange. This is the Prime Minister's then 17-year-old daughter on her first day of work experience.
In all reality, Paetongtarn Thaksin need never work again as she is one of the richest people in Thailand.
This is Thaksin Shinawatra's only son. A budding businessman, he's just been awarded a share contract to offer advertising space in the tunnels of Bangkok's recently opened subway system. It reversed an earlier announcement that a rival company had been the successful sole bidder. Cries of political interference have been strongly denied.
SURANAND VEJJAJIVA: Well, I think every procurement, every procedures in Thailand, there are steps that can be taken and there is a competitive bidding. If the best man that gets the bid happens to be someone's son, is well connected, if he can do the job it's fine. I mean, if he pass through the process and he has to... ..it's the job that counts, it's not what...who is he is in Thailand.
SOMKIAT TANGKITVANICH: I think this is the case where we have real conflict of interest.
Economist Dr Somkiat has queried several decisions made by the government which have clearly benefited Thaksin family companies.
A tax break awarded to Shin Satellite is one such case.
REPORTER: What's it worth to the company? What's this exemption worth?
SOMKIAT TANGKITVANICH: The Board of Investment has calculated the numbers and it was something like US$400 million in terms of tax exemption.
REPORTER: And this is a case where the Prime Minister would say it's got nothing to do with him, it's his family's company, but be's not running the show?
SOMKIAT TANGKITVANICH: Well, he is by the law the chairman of the Board of Investment. Even though in this particular case he did not preside over that meeting, he usually handed...given the authority to some deputy Prime Minister. But at least by the law he is irrefutably the chairman of the board so there is clear conflict of interest.
The Prime Minister's right-hand man says any suggestion of conflict of interest is just a matter of perception.
SURANAND VEJJAJIVA: You know, the perception problem might be in some of the few opposition people, but I think 19 million votes that has voted Thai Rak Thai have no perception of what the problem with us.
REPORTER: So that is good enough, you don't have to have any other checks and balances because you've got the weight of the people on your side?
SURANAND VEJJAJIVA: Well, it is a democratically elected government.
REPORTER: But aren't governments meant to be accountable as well?
SURANAND VEJJAJIVA: I'm a democratically elected government. Come on, Ginny. I mean. I listen to you. I listen to you as you are interviewing me. But I also listen to 19 million votes. Whose weight am I going to give on.
Today the PM is watching joint exercises between the army, air force and navy. It's been a tough week in politics and in the country's south separatist violence continues unabated. The death toll climbs daily.
Thaksin's response to the Muslim insurgency has been characteristically tough and uncompromising. 78 mainly young men were killed last year after being hogtied and forced to lie face-down on trucks after security forces moved in on a group of demonstrators.
His critics say the Prime Minister should personally accept some responsibility for the deaths of the young men arrested at Tak Bai.
SOMCHAI HOMLAOR, LAW SOCIETY OF THAILAND: Because those people were arrested right, and he said that we should not treat them as innocent people. And what happened if you are the policemen who handle the transportation and you hear that message from the Prime Minister said that OK, we should not treat them as innocent people. I kick them. I punish them. I do whatever means to punish them because they are not innocent people. They are criminal.
REPORTER: So the Prime Minister is in some way at fault for what happened that day?
SOMCHAI HOMLAOR: The message he gave is wrong. This is to the public, but we don't know what he... ..what did he tell the government officers in the meeting. It's made worst.
But in recent weeks there's been a major reversal from a leader accused of being arrogant, and unwilling to listen. Thaksin Shinawatra has admitted he's been too tough.
THAKSIN SHINAWATRA: If we think that things have been... went wrong, if we have to turn back, we should turn. That's normal, you know. Humans always commit error. There is no human that commit no error. That's normal.
REPORTER: What went wrong? What did you do wrong?
THAKSIN SHINAWATRA: Well, I think maybe, we... what I call it, target hardening, you know, we make the target hardening. That is we may consider the violence too tough, so that we get too much of an aggressive measure. So we should do all the reconciliation instead of trying to pressure too much.
Some of Thaksin's critics hope his admission will herald a new corporate style from the country's CEO. The government has even set up a National Reconciliation Commission to improve relations between Buddhists and Muslims in the south.
Surin Pitsuwan, a former foreign minister and deputy opposition leader, has been appointed to the new commission.
REPORTER: How did he get it so wrong? What did he do that was so wrong that caused the situation to get so violent?
SURIN PITSUWAN, NATIONAL RECONCILIATION COMMITTEE MEMBER: Arrogance of power. It takes time for people to learn that you are fallible, that you might not know it all, that you might need others to help to provide information and assistance. And I think that arrogance of power could lead many people into the wrong, and the sooner they realise the better. In this case, a realisation has been made and it is heartening for a lot of people including myself.
This is Thailand, where cool hearts, social calm and respect for authority are considered the finest values to aspire to. But that highly sought-after quiet reserve, is about to be challenged by the arrival of one man.
WOMAN (Translation): I just touched the Prime Minister's hand.
By this welcome you could be excused for thinking he's a rock star, but this is Thaksin Shinawatra, Thailand's Prime Minister.
THAKSIN SHINAWATRA, THAILAND PRIME MINISTER (Translation): Good luck, I wish everyone happiness.
WOMAN (Translation): Hello, Can I touch your hand. I wish you happiness for the New Year.
THAKSIN SHINAWATRA (Translation): Hello, hello.
WOMEN (Translation): I wish that you Prime Minister are always able to solve the problems. Please put it over your head. You look very cute.
This is the birthplace of Thailand's most powerful man. And today Thaksin Shinawatra has returned to the northern city of Chiang Mai to preside over a Buddhist ceremony marking the start of the Thai New Year.
This Prime Minister has done what no other before him has ever achieved - a second term in office and a hold on power almost without challenge.
WOMAN, (Translation): Im so happy that hes here today. I wish him happiness and longevity. So Im happy to meet him, Ive never met him before.
To many, Thaksin Shinawatra is the man with the Midas touch. He came to politics after making a fortune of US$2 billion flogging computers to the police department.
In 2001, this former police colonel-turned-businessman was elected Prime Minister in a landslide result. And unashamedly, he soon set himself a timetable to take Thailand into the first world by running the country like a company.
In Thailand, being rich is considered a virtue, being very rich is practically godly, and being next to Thaksin, well, there's always hope that some of that will rub off.
The Prime Minister's dynamic, hands-on style has won him a loyal following, particularly amongst Thailand's majority rural population.
MAN, (Translation): Yes I like Mr Thaksin, he always makes sharp, quick decisions. Hes decisive and prompt to fix any problems and this is what people like. And he has thought up a long-term plan. I like him.
But Thaksin Shinawatra is not without his critics, notably those who condemn his lethal crackdown on drugs, his handling of the upsurge of separatist violence in the country's south and his family's business success since he took office.
SULAK SIVARAKSA, SOCIAL CRITIC: He has the ability of a commercial man. He can sell and I thought and many of us thought that he has enough money, he won't be corrupted so we gave him a chance.
Sulak Sivaraksa is a leading Buddhist scholar and social critic who's been disillusioned by Thaksin's rule. Tonight he's celebrating his sixth cycle birthday - an auspicious occasion in the Buddhist calendar. A group of artists and puppeteers is putting on a performance in his honour and the chief protagonist is none other than Thaksin Shinawatra.
PUPPET SHOW, (Translation): Im so happy and I want to celebrate with some wine. 100,000 baht per bottle, such a fine wine! And I drink this wine every single day, or every Saturday before going out to meet my people and lie to them.
Thaksin has Chinese ancestry, and this is how Sulak Sivaraksa explains the PM's brash style.
SULAK SIVARAKSA: Well, I suppose you would say a clash of culture but of course I don't want to make racism, you know. He claim to be Thai, he claim to be Buddhist, but in the Thai culture, you know, the strength and weakness of Thai culture, you don't push straight, you don't hurt people's feelings unnecessarily, you know.
We have have the word 'kreng jai', you see? And have to 'jai yen' - cool heart. He has none of this.
Back at the puppet show, the leader of a mythical kingdom is being praised for the lethal success of his war against drugs.
PUPPET SHOW, (Translation): Police Lieutenant General Jaksin Nation-Eater has governed this country for four years. He has beaten, imprisoned and ordered the killing of over 3,000 people, an outstanding achievement.
A nationwide crackdown on the drug trade, which began soon after Thaksin was elected to office, resulted in the killing of more than 2,500 people. The Prime Minister had given explicit orders to crack down hard.
REPORTER: Prime Minister what do you wish Thailand for a Happy New Year? What would make Thailand a happy place in your mind?
THAKSIN SHINAWATRA: Well, peace. Peace, everywhere all of the people in the world love peace. OK. So peace. After peace is prosperity.
But now a new war is on its way.
REPORTER: Prime Minister, you said peace. You announced yesterday your war on drugs Mark III. There are a lot of people who died in the first wars, is this one going to be different?
THAKSIN SHINAWATRA: It is totally different.
REPORTER: How?
THAKSIN SHINAWATRA: Peace and the drug suppression is totally different.
REPORTER: But a lot of people died in the drug suppression?
THAKSIN SHINAWATRA: That's because of the cult of killing among those drug traffickers and also there might be extraordinary, but it's not much, we do the investigation.
No-one has been brought to account for the more than 1,000 apparent extrajudicial killings. Thaksin Shinawatra believes he has time on his side.
THAKSIN SHINAWATRA: We can prosecute them, for those who commit crime, in 20 years so it's plenty of time. Don't worry.
But these killings seemed to have caused little alarm amongst Thailand's voting public when they went to the polls earlier this year. Thaksin Shinawatra is now the most powerful elected leader Thailand has ever had.
ABHISIT VEJJAJIVA OPPOSITION LEADER DEMOCRAT PARTY: Well, he now has 377 seats in a 500-member house so he has a comfortable majority.
Abhisit Vejjajiva leads the opposition Democrat Party.
REPORTER: You're talking about a very powerful man?
ABHISIT VEJJAJIVA: Yes, and I think he's not been hesitant at all in using that power the way that he wants to. So that it's not just a question of the lower house but also the way he deals with the bureaucracy, the way he deals with the media in Thailand. He's really amassing a lot of political power and wealth.
Dateline tried for months to gain an interview with the Prime Minister without success. We were eventually told he does not give exclusive interviews to the foreign media.
Suranand Vejjajiva, the Prime Minister's right-hand man, was nominated to speak in his place. He's worked for the Prime Minister for almost a decade, and made the move with him from business to politics.
SURANAND VEJJAJIVA: Minister to the Prime Minister: He's a very decisive man. He knows what he wants. He knows what to do. Of course he's been successful, a successful businessman, and he was a policeman, so in a way he understands Thai bureaucracy, in a way he understands modern management, he understands what globalisation means and what it means to Thailand.
Now his critics say power has gone to his head, allegations about the Thaksin's family business connections just won't go away.
Five of Thailand's six television stations are state or military owned. The sixth, is controlled by the Shin Corporation, the conglomerate Thaksin Shinawatra founded, which is now worth US$2.5 billion, and with interests ranging from mobile phones to satellites and the Internet.
REPORTER: The research that you have carried out has looked into wealth generated by political connection. Who is getting rich?
SOMKIAT TANGKITVANICH, THAILAND DEVELOPMENT RESEARCH INSTITUTE: It is very narrow. Only five companies. And all of them are related with the Prime Minister's family.
Economic analyst Somkiat Tangkitvanich, from the respected independent Thailand Development and Research Institute, has been studying the stock market and the performance of Thai companies since the Prime Minister won office.
REPORTER: So the five companies that are doing extremely well in Thailand?
SOMKIAT TANGKITVANICH: Out perform the rest of the stock market.
REPORTER: By how much?
SOMKIAT TANGKITVANICH: By 141 percentage points.
The performance of companies connected to Thaksin has now become a major issue in Thailand, with allegations not only of conflict of interest, but also attempts to muzzle the press.
In this Bangkok hotel, journalists, politicians and academics have united to declare support for one young woman who's taking on the most powerful family in town.
SUPINYA KLANGNARONG, CAMPAIGN FOR POPULAR MEDIA COMMITTEE: Maybe they support me personally but I think most of the people who support this event today I think they support press freedom and I think the right of people in Thailand to fight against, how to say, the injustice.
Media advocate Supinya Klangnarong is being sued by one of Thaksin's family companies for daring to say publicly what was obvious from the stock market - that the Prime Minister's family-run business empire has done very nicely in the past few years.
REPORTER: Do you stick by it? Is it true, can you prove it?
SUPINYA KLANGNARONG: Of course, what I said is mainly based on fact. Fact one is that Shin Corporation getting...they got more profit, that's a fact. And they got also more income, also that's a fact. And all the business that they have done, just like TV, satellite, that's a fact.
And the government enacted many law and policy involving in the media, that's a fact.
But Supinya went further - she accused the company of using its profits to enhance the fortunes of Thaksin's political party.
In this David-and-Goliath battle Supinya Klangnarong is facing jail and a compensation claim for libel worth 2,500 times her annual salary.
SUPINYA KLANGNARONG: So they are asking for US$10 million. So if I lose the case, I have to pay. If I don't have money, they will declare me as a bankrupt person. So for me it would be no problem, but it will be high risk for the media agency, just like the newspaper company so that why this is not good to intimidate the media agency or media company.
While these claims have been widely reported elsewhere in Thailand, Supinya Klangnarong alone appears to have been singled out. The government maintains the Thaksin family companies are simply benefiting, like everyone else, from the government's good handling of the economy.
SURANAND VEJJAJIVA: If what she said is a fact, the judges will tell her it is a fact and then it will rule in her favour.
REPORTER: But what message does that send to the media in Thailand?
SURANAND VEJJAJIVA: Come on, every media have their own accountability and responsibility, you can say anything. Everybody always say free media, every interview - even what I am doing now I can say what I want. But it should not impede on other peoples rights and liberties, right?
So if it does and she gets sued by it, If someone feel that they are being offended or being...it's wrong and she gets sued, that's the Western process, that's the Western justice process. Same here.
REPORTER: It doesn't look good for the Prime Minister?
SURANAND VEJJAJIVA: It's not the Prime Minister suing.
REPORTER: It's his family company.
SURANAND VEJJAJIVA: Come on, even if the Prime Minister sues so what, if the Prime Minister feels that he is being wrongly accused?
The Thaksin family is now the wealthiest family in all of Thailand, according to shares held on the Stock Exchange. This is the Prime Minister's then 17-year-old daughter on her first day of work experience.
In all reality, Paetongtarn Thaksin need never work again as she is one of the richest people in Thailand.
This is Thaksin Shinawatra's only son. A budding businessman, he's just been awarded a share contract to offer advertising space in the tunnels of Bangkok's recently opened subway system. It reversed an earlier announcement that a rival company had been the successful sole bidder. Cries of political interference have been strongly denied.
SURANAND VEJJAJIVA: Well, I think every procurement, every procedures in Thailand, there are steps that can be taken and there is a competitive bidding. If the best man that gets the bid happens to be someone's son, is well connected, if he can do the job it's fine. I mean, if he pass through the process and he has to... ..it's the job that counts, it's not what...who is he is in Thailand.
SOMKIAT TANGKITVANICH: I think this is the case where we have real conflict of interest.
Economist Dr Somkiat has queried several decisions made by the government which have clearly benefited Thaksin family companies.
A tax break awarded to Shin Satellite is one such case.
REPORTER: What's it worth to the company? What's this exemption worth?
SOMKIAT TANGKITVANICH: The Board of Investment has calculated the numbers and it was something like US$400 million in terms of tax exemption.
REPORTER: And this is a case where the Prime Minister would say it's got nothing to do with him, it's his family's company, but be's not running the show?
SOMKIAT TANGKITVANICH: Well, he is by the law the chairman of the Board of Investment. Even though in this particular case he did not preside over that meeting, he usually handed...given the authority to some deputy Prime Minister. But at least by the law he is irrefutably the chairman of the board so there is clear conflict of interest.
The Prime Minister's right-hand man says any suggestion of conflict of interest is just a matter of perception.
SURANAND VEJJAJIVA: You know, the perception problem might be in some of the few opposition people, but I think 19 million votes that has voted Thai Rak Thai have no perception of what the problem with us.
REPORTER: So that is good enough, you don't have to have any other checks and balances because you've got the weight of the people on your side?
SURANAND VEJJAJIVA: Well, it is a democratically elected government.
REPORTER: But aren't governments meant to be accountable as well?
SURANAND VEJJAJIVA: I'm a democratically elected government. Come on, Ginny. I mean. I listen to you. I listen to you as you are interviewing me. But I also listen to 19 million votes. Whose weight am I going to give on.
Today the PM is watching joint exercises between the army, air force and navy. It's been a tough week in politics and in the country's south separatist violence continues unabated. The death toll climbs daily.
Thaksin's response to the Muslim insurgency has been characteristically tough and uncompromising. 78 mainly young men were killed last year after being hogtied and forced to lie face-down on trucks after security forces moved in on a group of demonstrators.
His critics say the Prime Minister should personally accept some responsibility for the deaths of the young men arrested at Tak Bai.
SOMCHAI HOMLAOR, LAW SOCIETY OF THAILAND: Because those people were arrested right, and he said that we should not treat them as innocent people. And what happened if you are the policemen who handle the transportation and you hear that message from the Prime Minister said that OK, we should not treat them as innocent people. I kick them. I punish them. I do whatever means to punish them because they are not innocent people. They are criminal.
REPORTER: So the Prime Minister is in some way at fault for what happened that day?
SOMCHAI HOMLAOR: The message he gave is wrong. This is to the public, but we don't know what he... ..what did he tell the government officers in the meeting. It's made worst.
But in recent weeks there's been a major reversal from a leader accused of being arrogant, and unwilling to listen. Thaksin Shinawatra has admitted he's been too tough.
THAKSIN SHINAWATRA: If we think that things have been... went wrong, if we have to turn back, we should turn. That's normal, you know. Humans always commit error. There is no human that commit no error. That's normal.
REPORTER: What went wrong? What did you do wrong?
THAKSIN SHINAWATRA: Well, I think maybe, we... what I call it, target hardening, you know, we make the target hardening. That is we may consider the violence too tough, so that we get too much of an aggressive measure. So we should do all the reconciliation instead of trying to pressure too much.
Some of Thaksin's critics hope his admission will herald a new corporate style from the country's CEO. The government has even set up a National Reconciliation Commission to improve relations between Buddhists and Muslims in the south.
Surin Pitsuwan, a former foreign minister and deputy opposition leader, has been appointed to the new commission.
REPORTER: How did he get it so wrong? What did he do that was so wrong that caused the situation to get so violent?
SURIN PITSUWAN, NATIONAL RECONCILIATION COMMITTEE MEMBER: Arrogance of power. It takes time for people to learn that you are fallible, that you might not know it all, that you might need others to help to provide information and assistance. And I think that arrogance of power could lead many people into the wrong, and the sooner they realise the better. In this case, a realisation has been made and it is heartening for a lot of people including myself.