THE CURRENCY TURMOIL THAT HIT SOUTHEAST ASIAN countries in mid-1997 was initially expected to last only a few months. More than a year down the road, far from being resolved, the turmoil has spread throughout the world. No one has really benefited except possibly the currency traders and share-market speculators.

One must ask why this is happening. Is it part of the usual economic cycle? Is it because the economic system and practices of all of the affected countries are wrong? Is it be-cause of corruption, of crony-capitalism and nepotism? Everyone must concede that, prior to the turmoil, the coun-tries of East Asia were among the most dynamic and pros-perous in the whole world. Their progress and prosperity were real. Employment rates were high. Per capita income increased steadily. From poor agricultural countries, they had become highly industrialized nations, producing quality high-tech goods for markets worldwide. They were set to grow and grow.

The free marketeers might be reminded that countries do not grow and develop by accident. The envi-ronment must be conducive to growth. For this, the government must play a role. All governments are corrupt to one degree or another. But what's certain is that, if a country does well, the government cannot be totally corrupt and incompetent. The gov-ernments of East Asia are far from perfect, but no one can say they did not bring prosperity as well as real, tangible and personally felt benefits to their people. Such was the progress and potential that investors came in droves to get a share of that prosperity. And they all profited hugely from their participation.

What do we see today? These countries and their peo-ples are suffering. It takes a distorted mind to say that the present situation is better than the prosperity of the past. Yet we are being told that the destruction of our economies will be good for us in the long term. How do we tell the un-employed millions, the bankrupted banks and busted companies that their misfortunes are good for them and their nations? How do you tell a man being devoured by a tiger that he is really helping to preserve a treasured species?

The fact is that the economic disaster would not have happened if the speculators had not attacked the currencies and the share markets. If it could happen without their at-tacks, it would have happened long ago. The same systems and practically the same governments had ruled these countries for 40 long years. But far from being economically recessive as they are now, these countries grew by leaps and bounds. Surely these governments were responsible for the so-called "miracles." And surely these governments alone cannot be the cause of their economic collapse. Yet these governments are being blamed while the currency traders, foreign capitalists and hot-money stock-market raiders are being praised for their efforts to discipline these govern-ments, to force them to change their ways, i.e., to adopt the ways of Western governments and business.

Are we only interested in the means and consider the ends irrelevant? Systems developed by every human so-ciety are meant to benefit society. And so tribal, feudal, democratic, socialist, communist and other systems were devised. Almost invariably the followers of these systems forgot the objectives in their desire to be seen as true be-lievers. Extremism followed and, far from creating ideal societies, millions were killed, tortured and impoverished. It took a long time before someone dared to challenge the faith and break away.

Now we are being told that the only system allowed is that of capitalist free markets, of globalization. Every-one must accept this system or be " considered a heretic and punished I accordingly. Not the slightest modification is allowed. That the unfettered, unregulated free market has destroyed the economies of whole regions and of many countries in the world does not matter. The important thing is that the system is upheld.

There was a time when Christians believed in the Inquisition, in killing Christian non~nformists, Muslims and Jews. It went on for 300 years before it dawned upon the inquisitors that what they were doing was not Christian at all. Many ideologies took decades. even centuries. to be acknowl-edged as wrong. So the question must be asked: How long before we reject the infallibility of the free market dogmas? Some are already timidly criticizing the International Mon-etary Fund, the speculators, the capital flows across borders, the right of the self-appointed market forces to discipline elected governments. Can we wait 300 years? The damage is already extensive. It will take decades to restore the economies. Should we fiddle?

Malaysia cannot wait. Malaysia has chosen to become a heretic, a pariah if you like. Onr appeal to the world com-munity to regulate and bring order to the market has gone unheeded. If the international community cannot change, then Malaysia must undertake its own reform. We may fail, of course, but we are going to do our damnedest to succeed, even if all the forces of the rich and the powerful are aligned against us. God willing, we will succeed.

By Dato Seri Dr. Mahathir Mohammad
The Times 19 September 1998