Regime Change — page 3

After a month of solitary confinement and an average of 10 hours a day of interrogation, explains Hishamuddin—still twitchy months after his release and smoking his fifth cigarette in an hour—he broke down and told his questioners whatever they wanted to hear. "I regretted being born. It damages you. I carry it inside me every day." He glances out the open balcony doors of his apartment. The hill opposite, until recently covered in thick foliage, has been clear-cut, and bulldozers are busy nosing the piles of raw, orange soil into place for the construction of a new condominium. "I was flushed into the sewer that maintains the whole system," Hishamuddin finally continues. "Malaysia's facade is the tallest buildings in the world, the international airport and so on. But there is a price to pay." After two months in solitary, Hishamuddin spent two further years in a detention camp. He was never charged and not once during that period was he questioned about attempts to obtain arms, he says.

Mahathir, who declined TIME's requests for an interview, has in the past been characteristically pugnacious in defending such actions, saying they are necessary to preserve the peace in a multiracial country like Malaysia. In 2001, he told a conference in Dubai that "some countries must be ruled by dictators" to avoid the pitfalls of multiparty democracy. So long as "good people" are in charge, he added, feudal kings and dictators could provide good governance. Two years earlier, when asked by this reporter if he had made any mistakes, Mahathir thought for a long moment before answering: "I've gone against the stream many, many times, and it just so happens that in most instances I have been proved correct."

Among the plans Mahathir allows he may have got wrong was Perwaja. The state-owned steel plant was an early Mahathir scheme to accelerate the country's industrialization. Today, Perwaja has so far cost Malaysian taxpayers some $2 billion and still shows no sign of making a profit. Just as the Anwar affair was to some merely the logical outcome of Mahathir's growing authoritarianism, to the Prime Minister's detractors Perwaja is merely the most glaring example of a series of ill-conceived, grandiose schemes that have depleted the country's coffers. In the 1980s, Mahathir, so vitriolic about currency traders and hedge-fund managers, presided over speculation in the foreign-exchange market that cost the central bank $6-$11 billion. Even the national car so beloved by the likes of Ibni is not immune. Despite massive government subsidies and tariffs on competitors of up to 300%, Proton reported that its August sales plummeted by almost a quarter from a year earlier. Foreign-car sales, in contrast, rose 40%. "Economically, it is a very mixed legacy for the Deputy Prime Minister," says Shahrir Samad, a former Cabinet minister and current member of the supreme council of the United Malays National Organization (UMNO), the political party that leads the national ruling coalition. "What does he do with things like Perwaja and Proton? Those are very difficult burdens to carry and manage."

There's also the lingering issue of cronyism, Mahathir's policy of favoring certain entrepreneurs by granting them government contracts. He has justified this in part as a means of creating Malay millionaires who could act as role models. Following the Asian financial crisis of 1997, Mahathir made a real move to address concerns about crony mismanagement. Some of those most criticized for benefiting from favoritism, such as Malaysia Airlines chairman Tajuddin Ramli, were ousted and new management installed at their conglomerates.

Analysts and diplomats in Kuala Lumpur say the Prime Minister was soon back to his old ways, noting that a businessman from Mahathir's home state of Kedah, Syed Mokhtar al-Bukhary, suddenly seemed to be winning an inordinate number of government contracts. Syed Mokhtar's associates counter that he gets the contracts because he delivers. "I have not seen the group fail on any of its major projects," says one businessman close to Syed Mokhtar. "These aren't given on a platter." But, says an investment banker close to Abdullah, "there's a lot of concern" about Syed Mokhtar's expansion. The fear is that Syed Mokhtar is involved in so many different businesses that in the event of another economic crisis the empire might be sufficiently dented that it could present a systemic risk. Some analysts believe that Abdullah will distance himself from Mahathir's practice of pampering favored tycoons and baby-sitting the Malay community. "The relationship between politics and business under Mahathir is very, very strong," says activist and academic Charles Santiago. "What we'll see is a phasing out of that relationship under Abdullah."

Politically, the new PM will face a delicate task, distancing himself from his predecessor without seeming disloyal. There's no doubt that the genial Abdullah, 63, with his reputation as a corruption-free family man descended from a line of Islamic scholars, will be able to draw some voters back to UMNO. But it will still be hard to heal the wounds caused by the Anwar affair, which led to UMNO's worst showing ever in the latest general elections, in 1999. Abdullah's supporters are already gently preparing the ground, talking of a change from "magisterial to managerial" rule and emphasizing that their man is a consensus builder, a listener. Abdullah has also begun staking out ground of his own on the corruption issue, giving regular speeches on the need to clean up the civil service, for example.

If fence sitters like factory supervisor Ibni are anything to go by, the Abdullah camp's careful strategy could work in the next general elections, widely expected around next April. Back in Puchong, it is getting late, and Ibni has put off for another night the decision on buying the car. Before leaving, he sums up his thoughts: "I still cannot rationalize or accept Anwar's fate. But I am prepared to give [BRACKET {Abdullah}] a chance." And what about Mahathir? Here one of the more ebullient car salesmen, Zamzury Rahman, breaks in: "Nobody is perfect. We don't say Mahathir is perfect. But he has done a lot of good for this country. And when you have an excess of good, you forgive the bad." With almost two-thirds of households owning TVs and cars, with smoothly flowing highways to drive on, with decently paid work still widely available and with the different races at peace, many Malaysians agree.

With reporting by Baradan Kuppusamy and Michael Schuman/Kuala Lumpur

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