In light of the impending general elections in Malaysia, it will be interesting to explore the intricate link between economics and politics.
Economists, by training, cannot help themselves but to see the world from the point of view of economics - the rise and fall of industries and sectors in the changing tides of supply and demand between all participants in the economic game. Behind the aggregate numbers that we analyse are private individuals jostling for their place in the sun, those successful trying even harder to be the biggest and those in the shade shouting in desperate voices to be heard, to whoever who want to here, and, hopefully, to be counted. There is also a harsh reality. The poor in the countryside can always resort to eating worms and rodents, but those homeless in towns and cities will have to plunder the garbage bins and sleep in the streets. The town mouse and the country mouse certainly do have different lifestyles but everyone share the same fate in having to labour for their daily sustenance except for the fat cats do live on the returns on capital.
There are in general a handful of distinctive economic systems. We could live in a world of utopia where everybody has everything they want and not having to work is, in literature, commonly called heaven where we do not have a stomach and are fuel efficient and we are nothing but a state of mind. Unfortunately, economists deal only with the material implications of being human and have left this study to a different school of thought. In reality, the nearest we get is where everybody has everything they need (but not want) and they all have to share the burden of labour (and no one is supposed not to work). The concept of this was first described by Karl Marx. But in reality, all material assets belong to everyone but no one in particular, except for an artificial constrict called the party where everybody has a party. The party controls the state which represents everyone and hence the party controls everyone and holds in trust the assets of the people. This now roughly comes under the label of communism. Ideally, of course, the assets should be owned by the people themselves. Ideally, the assets should be shared equally. As we can see in the problem of the distribution of inherited assets in a family, this is seldom a straight forward case and the impact on successive generations is a very interesting phenomenon to observe in society. The problem with assets is that you cannot have your cake and eat it. You cannot consume and save at the same time. You can consume only if you have income. The most socially acceptable manner of earning an income is to work very hard. The socially unacceptable way of earning an income is to ride on the back of others who have to work very hard. Everybody loves to be the monkey on somebody else's back. This is why throughout history is a battle against usury or, in modern parlance, loan sharking. Even charging an interest rate, where the lender takes a first right to an income, is frowned under by some communities. These communities instead champion the concept of venture capital where everybody shares the risks as well as the profits. It is this right of capital that takes the shape of the interest rate that is the driving force of the modern world of so-called capitalism. Capital, an inanimate object, is taken to be object of holder of value precisely because it cannot die, or thought to be undying. In early times, this capital is gold and silver, then gold-backed currency, and when fiat money is introduced, all attention turned to real estate especially in another artificial construct called towns and cities where real estate hold value only because people from the countryside sees towns and cities as mirages rising out from nowhere and then suddenly they glitter with gold, literally. It is where the market economy comes in and people bargain and cut deals and trade. In any economic system, there will be a town mouse and a country mouse, and the two seldom can be the same person because of the difference in the workings of the towns and the countryside. It is a major error in judgement to encourage the country mouse to be envious of the town mouse unless one is really filled with envy and jealousy. The only way to go is to choose one's own path in life and to make the best of it within one's means and ability.
It is quite interesting that, in trying to describe economic systems, we in fact ends up describing political systems, politics being the power play among different groups in the economy as they fight for dominance and control. It is sad when the battle lines are drawn along racial grounds for history has shown us that, when this is race, one unfortunate race or another will have to suffer as a result of deliberate policy. The same goes for religion. The only real issue, from the economic perspective, is between the rich and poor, the capitalists and the workers. When politicians are sided with the rich and the capitalists, this is where real politics comes into play.
I surmise that whichever way we vote, our decision is likely to be less than perfect and we will have to face the consequences of human weakness. There is a fine balancing act between preserving continuity and stimulating freshness. In the end, the voting is likely to be influenced by the underlying economic conditions on the ground. We will see whether the economy is that impeccable when the results are out. Happy voting.