Vision. Map of Asia. Mahathir in crowd, men in costume, parade with people in gold costume men beating drums,

Negus: Inside Mahathir's Malaysia a rare look at graft and the politics of money. These are the bhumiphutras, sons of the soil, native Malays, the backbone of the Prime Minister's long rule, but Asia correspondent Sally Neighbour has found that the practice of vote buying is now threatening Mahathir.

00:49:09

Dr. Mahathir

Dr. Mahathir: It is a phenomenon to be found in every country. I think in Australia, too.

01:13:01

Map of Japan. Golf cart, man playing golf, houses near green.

Negus: In Japan, apparently, where there's a sporting will, there's a business way. In this case, an 18-hole golf course on a suburban block, but with one major setback:

01:17:21

Negus

Negus: First the Malaysia of Prime Minister Mahathir Mohammed. Malaysia has been led by Mahathir's United Malays National Organisation, UMNO, for the past 13 years. And within the next 6 months it goes to the polls. With the Malay economy humming, Mahathir's re-election is pretty much a foregone conclusion. Nevertheless, his party is certainly taking no chances. UMNO virtually dominates all sections of Malay society. From the traditional villages right through to big business. Asia correspondent Sally Neighbour has just returned from Malaysia, where she saw for herself just how pervasive money politics has become for that country.

01:36:01

Dr. Mahathir exiting car and shaking hands with crowd, map of Malaysia and Indonesia.

Neighbour: A new election campaign is about to begin in Malaysia. The country's longest serving Prime Minister, Dr. Mahathir Mohammed prepares to take his ruling coalition to the polls. They might as well hold the victory parade now.

02:15:00

Dr. Mahathir walking through crowd, men in suits, Dr. Mahathir addressing crowd, Neighbour in crowd.

They've good reason to be triumphant. The national front coalition dominated by Dr. Mahathir's party, the United Malays National Organisation, or UMNO, has been in power for 37 years.

Dr. Mahathir: We cannot deny that Malaysia's current success in all fields, including the field of economy, is partly because we have a government that has ruled continuously since independence

02:41:11

Dr. Mahathir giving a speech, conference delegates, wide view of crowded conference hall, Dr. Mahathir speaking

Neighbour: UMNO's long reign has indeed delivered stability and prosperity. And the people in return have delivered to UMNO their loyalty and their votes. But it's not just the will of the people that's kept them in power, they've created a system that virtually assures that they can't lose.

03:16:01

Conference delegates,

Electorates are weighted in favour of the ruling parties. They control the newspapers, radio and TV. The activities of the opposition are curbed, and draconian laws stifle public debate.

03:34:07

Vision CU Dr. Mahathir laughing, Dr. Mahathir sitting at press table.

On top of all this, UMNO has built up financial resources so vast, that it's coined a phrase unique to Malaysia. They call it "money politics." This, as much as anything, keeps the UMNO government in power.

03:50:19

CU Sally Neighbour, CU Dr. Mahathir at press conference

Prime Minister, Sally Neighbour from the Australian Broadcasting Corporation. Are you confident about these elections?

04:06:15

Dr. Mahathir: Are we confident? We are always confident. I mean you don't go for an election. I mean you don't go for an election when you are not confident.

Neighbour at press conference

Neighbour: In past elections there've been widespread reports of the buying of votes, will you try to stop that in this election?

04:21:19

Mahathir and Neighbour at press conference

Dr. Mahathir: I think it's a phenomenon to be found in every country. I think in Australia, too. You may not know, but I'm quite sure they do. But we try, of course we can't always be successful.

04:25:21

Neighbour: What would you say has been the key to Malaysia's economic success?

Dr. Mahathir at press conference

Dr. Mahathir: All companies in Malaysia are closely associated with the government because we have a concept called Malaysia Incorporated. It is the duty of the government to be associated with the business people because in Malaysia Incorporated the government and the private sector work together to develop this country.

04:45:12

music

music

Vision skyscraper buildings, city traffic, construction site, city buildings,

Neighbour: Malaysia Incorporated has transformed the capital, Kuala Lumpur into one of the success stories of the region. With the richest stock exchange in Southeast Asia and economic growth better than eight percent a year, Dr. Mahathir's vision of seeing Malaysia join the developed world by the year 2020 looks well within reach.

05:05:04

People walking in street, man on phone, crowds, fountain, security guard.

Average incomes have soared. Poverty has been cut from more than 50 percent to less than 15 percent. In a nation whose past has been bloodied by ethnic turmoil, there's now racial harmony.

05:35:03

Fountain Noise

Cars driving out of white building, tall buildings, Neighbour standing in front of white building, UMNO sign.

SUPER: Sally Neighbour

Neighbour:  This is UMNO's headquarters in the capital, KL. It's a monument to Prime Minister Mahathir's Malaysia Incorporated. The building itself, known as the Putra World Trade Centre, cost two hundred and forty million Australian dollars. They spent sixty million just on the furniture and fittings inside. It's a lavish symbol of how UMNO has come to dominate Malaysia's political and economic life.

05:53:07

Dr. Terence Gomez sitting in office.

Dr. Gomez: A lot of how UMNO operates depends primarily on money.

Neighbour: Dr. Terence Gomez from the University of Malaya's Institute for Advanced Studies is the author of three books about money politics. His specialty is UMNO's corporate assets.

06:23:02

Neighbour in office with Dr. Gomez.

SUPER: Dr. TERENCE GOMEZ

Economist

Neighbour: How much corporate wealth does UMNO own or control?

Gomez: Well it's hard to quantify that amount at the moment. The figures range from 4 billion to more, to much more. I think it's much more.

Neighbour: That's more than 2 billion Australian dollars.

Gomez: Well that's been built up over the past twenty years. They have gone into the hotel industry, they have gone into the banking industry, they have gone into the media, they have gone into construction, property development, they've gone into practically all aspects of the economy.

06:41:06

Drumming

men shaking hands, men playing drums, women in costume carrying feathered poles, people in crowd.

Neighbour: UMNO's economic clout feeds a system of political patronage that trickles down from the capital to every rural village. UMNO has made itself the champion of the Malay people. Malay is UMNO they say, and UMNO is MALAY.

07:09:11

people at political rally, man conducting singers

The economic underdogs of Malaysia, the ethnic Malays  have traditionally left commerce to the Chinese and stuck to fishing and farming, Expanding their share of the country's economic wealth is UMNO's crusade.

07:33:02

Women singing

Women Singing

Neighbour:  At a rural gathering, the women sing their praise to god and the government.

07:47:13

We must achieve our economic goals, they sing, to realise the government's vision, the key to our success. The fate of every Malay is UMNO's hands, and the party expects absolute loyalty in return.

people reading oath on stage, people in crowd,

People on stage: We the farmers, livestock growers and fisherman, support wholeheartedly the government's policy of national development. We pledge our unity and co-operation to the movement.

08:14:21

Lilah Yassin walking through crowd greeting people,

Neighbour: Implementing government policy in the villages is the job of local UMNO men like state MP Lilah Yassin.

08:41:09

Mercedes cars driving down road, countryside, Yassin sitting in car, Neighbour and Yassin walking to school, woman in pink shirt, Neighbour standing next to Yassin

Neighbour: What has the government done for rural people.

Yassin: So many projects the government doing ...

Neighbour : Yassin and his entourage tour the countryside ministering to the needs of the party faithful. They travel in a style fitting for a man of this position, in a country where politicians now get the treatment once reserved for royalty.

Yassin: My portfolio is to develop education, information and manpower...

Neighbour : As state minister for education one of Yassin's tasks is to hand out scholarships. The line between state and party has long since blurred. Scholarships, like many other government favours, have become a reward for political loyalty.

Neighbour: So how do you decide who you support for a scholarship and who you don't?

Yassin: Very important thing, the people must support the government first, and then their government support the people.

Neighbour: So the people who support the government, they get the scholarships-

Yassin: Yes.

Neighbour and Yassin standing outside rural dwelling, boys in school uniform. children.

Neighbour : For a rural family like this, a scholarship is a lucrative prize worth about a third of a year's income. Political allegiance is a small price to pay.

09:52:00

Women in pink shirt and Neighbour talking in village

Woman: The UMNO officials in the village say it's good to join UMNO, because they say when you get older and you have kids it's easier to apply for scholarships and things like that. That's how they get us to join.

Neighbour: Do you have to be an UMNO supporter to get an UMNO scholarship?

Woman, sub-titles: Yes If we didn't join UMNO I guess we wouldn't get any help from the government.

10:01:20

Vision construction site, Yassin and Neighbour at construction site, men on site.

Neighbour: What is this project?

Yassin: This is a secondary school. This is the new building for the classroom.

Neighbour: Political allegiance also pays off for local UMNO officials. Their private companies usually get the contracts for government projects like the new local school.

10:32:12

Yassin and group of men sitting at a table, CU individual men,

Neighbour: The chairman of the local UMNO branch, this man, has his own construction firm, which gets all of its work, he says from the UMNO government and its authorities. His friend and colleague, another UMNO official, has the job of lobbying the government to ensure their company gets the work.

10:55:05

UMNO men laughing, Neighbour talking to men

Neighbour : If the line between party and state is blurred, then between business and politics there's no line at all.

Man, sub-titles: We have to make a living. We have to eat, that means we have to work. If we do only politics, 100% politics, full-time, then we're dead.

Neighbour: So you have to do business to survive?

Man: Yes. First business like ... and while doing business, we do politics.

11:11:23

white mansion, Neighbour and Razaleigh walk toward mansion, Neighbour and Razaleigh inside office,

Neighbour: Political life in Malaysia has been a lucrative business. Tengku Razaleigh, a prince from the northern state of Kelantan, is a veteran of the system they call money politics. He was finance minister in the UMNO government and party treasurer for thirteen years. A long time rival of Dr. Mahathir, Razaleigh challenged him for the leadership in 1987, in a move that split the party and left him in opposition. In his KL replica of the US president's oval office, Razaleigh is now only too happy to discuss the workings of the party he once hoped to lead.

11:54:01

Neighbour and Razaleigh sitting in office

Neighbour: How does money politics come into play in elections within UMNO?

Razaleigh: Well we've heard of pay-off ranging between thousands of dollars and to  millions of dollars. Because the positions give them power. The positions that they are seeking. And these people, really, go all out in order to achieve those positions that they are fighting for.

12:36:12

Dr. Mahathir at press conference, reporters at press conference,

Neighbour: Pay-offs within UMNO are so rampant, that the Prime Minister himself recently called a special party conference to ban candidates for UMNO positions from giving cash and gifts in return for votes. The alternative, he said, will be a government filled with and led by corrupt criminals. But the Prime Minister stopped short of calling a halt to a much more lucrative form of money politics.

13:05:20

Dr. Mahathir at press conference, Neighbour at press conference.

Neighbour: Prime Minister, what about the awarding of multi-billion-dollar government contracts to companies closely associated with UMNO leaders? Should that be stopped, too?

Dr. Mahathir: We think that the government and the private sector have a duty, both of them to vote together and develop the country. And therefore we cultivate the friendship of the private sector, and the private sector can have access. Anybody who succeeds immediately is said to be well-connected. But all businessmen in Malaysia are well connected with the government. That is our policy. Malaysia Incorporated.

13:30:17

Neighbour and Razaleigh talking in office

Neighbour : UMNO's intimate relationship with business is something Tengku Razaleigh knows a lot about. He controlled the finances of the government and the party when UMNO first ventured into the corporate world.

14:12:19

Neighbour: How did UMNO become so rich?

Razaleigh: Well I think because they were granting contracts to themselves. When I say to themselves, to people who as I said are closely associated with the people who are in power.

Neighbour: What sort of contracts are you talking about?

Razaleigh: Big, big projects. Works program, public works, acquisitions of assets.

Neighbour: Of the order of how much money involved would you say?

Razaleigh: Well nowadays people don't talk of thousands or millions of dollars, they talk of billions of dollars.

Cars driving on highway, Neighbour standing in front of toll booths, driver paying toll, traffic

Neighbour: the most dramatic example of this is the recently completed highway that runs the length of Malaysia. Six hundred kilometres from the Thai Border in the North to Singapore in the South. The north/south highway is just one of the huge public works projects awarded by the UMNO government to companies controlled by UMNO. The contract for this job was given to what was then an obscure and ailing engineering firm which turned out to be majority owned by and UMNO holding company whose trustees were none other than UMNO's leading officials, including the Prime Minister, Dr. Mahathir. The company not only got the 2 billion dollar contract to build the highway, but its subsidiary won the right to collect the tolls for the next 30 years.

15:03:08

That same UMNO company, United Engineering, has since gone on to become one of the biggest construction firms in the country. When controversy erupted, instead of changing the system, they changed the paperwork. UMNO has since transferred its corporate assets into the hands of a small group of business allies who continue to benefit from the government's vigorous policy of privatisation.

Gomez and Neighbour in office.

SUPER: Dr. TERENCE GOMEZ

Economist.

Gomez: If you look at all the major privatised contracts today, the government basically has a policy of first come, first served.

Neighbour: First come, first served... So, no tenders?

Gomez: Look at the major contracts today, and most of the people who win these contracts are those who are all politically linked businessman.

Neighbour: Closely linked with UMNO?

Gomez: Yes they are all closely to linked to our top UMNO leaders.

16:20:13

Broadcast machines, people at control panels of television station, Neighbour and manager in large office.

Neighbour: UMNO and its coalition partners began buying up the media twenty years ago, and now have their men firmly at the helm.

16:43:00

Neighbour: What's the big story today?

Manager: Should be the UMNO supreme council meeting.

Neighbour: UMNO supreme council meeting...

People working in television station.

Neighbour: The government keeps a tight reign on state-run radio and TV, and when the first commercial TV license was granted in 1983, it went to an UMNO holding company. The commercial network, TV 3, and the powerful New Straits Times Newspaper Group have since been taken over by a group of key UMNO supporters.

Neighbour and Bakar walking down corridor to office, Neighbour and Bakar in office.

SUPER: ABU BAKAR

Business leader

Neighbour: Abu Bakar is executive vice chairman of the media group's parent company, Malaysian Resources Corporation. He's a long time UMNO man, formerly the deputy chief of Prime Minister Mahathir's economic planning unit.

Bakar: The idea was that regard whole nation as a company, so private and public are not competitors, but are close complementary.

17:29:12

Neighbour: It's been a winning partnership for all concerned. A subsidiary of Abu Bakar's firm, was recently awarded the government contract to build a 2 billion dollar power station.

Neighbour: How did your company get that contract? Was there actually any kind of tender, really?

Bakar: Not in the sense that you said. The way we say it is negotiated tender.

Neighbour: Negotiated tender, first come, first served...

Bakar: First come, first served. You must  bring an idea...

Neighbour: Can you understand that people see this as a classic example of patronage?

Bakar: No way, nothing like that. No way. Completely false the way I see it.

Neighbour: Not patronage says Abu Bakar, simply the economic miracle that Dr. Mahathir Malaysia Inc.

CU Bakar.

Bakar: We built this country. If we had been that way, can you imagine we build a country that was in one generation of my parents, was actually a farmer, and me heading a corporate entity. Can you tell me any society can achieve that transformation with a mentality of what you have said? No way.

18:35:17

Parade, men playing drums, women carrying flowers, men shaking hands,

Neighbour: At their annual economic convention, the party faithful gather to celebrate what they've achieved. The guest of honour is the man who's presently driving Malaysia Inc., finance minister and prime minister to be, Anwar Ibrahim.

18:59:07

Ibrahim walking through convention, people at convention,

Neighbour: These are Malaysia's new rich, the ethnic Malays, bumiputras as they're known, in English, sons of the soil. Once the economic underdogs, they now hold a large stake in every part of this thriving economy. Their share of the country's corporate wealth has increased tenfold.

vision of convention, group singing on stage.

Neighbour: They owe it all to two decades of positive discrimination by the UMNO government. Preferential access to education, employment, finance and the stock market. There's much to sing about.

Singers on stage, people in crowd

Singers:

We overcome all obstacles

May UMNO live forever

We stand firm in hope

May UMNO be everlasting.

19:59:08

Anwar walking on stage.

Neighbour: But to UMNO's frustration, non-Malays still hold a majority of the national wealth. Prime minister to be, Anwar, says there's more to be done.

20:17:14

Anwar on stage

Anwar Ibrahim, sub-titles: What we have obtained is still very little compared to what is our right, and what we should have obtained by now.

20:25:19

Vision of conference delegates, Anwar on stage,

Neighbour: In UMNO's crusade there's no room for dissent. The government amended the constitution long ago, making it illegal to question the privileged status of the Malays. Anyone who dares to do so pays the price.

20:35:22

door with blue sign, Neighbour and Sing walking into building,

Neighbour: One man who did is lawyer and opposition MP Karpal Singh. Best known in Australia for his role in the defence of the accused Australian drug traffickers, Barlow and Chambers, hanged in Malaysia in 1986. The year after, Karpal Singh himself was behind bars.

20:51:23

newspaper headline, Neighbour and Singh talking in office

Neighbour: What were you arrested for?

Singh: The allegations are... were that I was anti-national, which is ridiculous, actually...all I asked for was equal rights, equal opportunity for all citizens.

Neighbour: Were you charged?

Singh: I was not charged. All the minister did was to order my detention for two years.

21:12:02

Neighbour: Karpal Singh spent 15 months in jail for challenging the government's discrimination in favour of Malays.

Neighbour: And if you did that again now would you be jailed...

Singh: Of course, I'm sure they would want to. It can't be debated, you can't question it, even in Parliament.

city street, crowds, temple,

Neighbour: The election will be hardest fought in the Chinese heartland of Penang, stronghold of the Opposition Democratic Action Party, led by Lim Kit Siang.

21:49:22

Neighbour and Siang in street, Siang greets hawker, Siang walks through market.

Neighbour: So this is your constituency?

Siang: Yes, this is my constituency. The hawker  Theuy.

Neighbour: But for all the frustration of his Chinese constituents over twenty years of discrimination, it's a fight Lim knows he can't win. The government is riding a wave of economic success, and all the odds are stacked against the opposition. They can't get media coverage, political rallies are barred, even the DAP's newsletter is banned from public sale.

22:05:01

Lim: well it basically continues to be a struggle for justice, for equality, for freedom in Malaysia for all.

Neighbour and Siang walking through market, Mahathir at election rally.

Neighbour: In UMNO's Malaysia, justice, equality and freedom have been trampled in the rush to carve up the spoils of progress. As they say here, it's first come, first served. For those at the top of the queue there's plenty to go around, the others get what's left, and for all the trappings of democracy, the election will come and go, a mere sideshow to the main event of the mighty Malaysia Inc.