Of morals and moral authority in Thailand
Suthichai Yoon, The Nation, Asia News Network/Bangkok
A government without any credible moral authority can't be expected to really care about the ramifications of "moral hazards".
It should come as no surprise therefore that Cabinet members and senior bureaucrats at the Finance Ministry and Civil Service Commission have been talking about singling out about 100,000 salarymen, who have amassed personal debts up to Bt200,000 (US$4,874) each since the 1997 financial crisis, and helping them under an unprecedented rescue scheme.
Confusion has reigned since PM Thaksin Shinawatra dropped the bombshell in his radio chat last Saturday (Oct. 1) that on Oct. 18 that "a pleasant surprise" would be in the offing to help those hit by heavy debts imposed by loan sharks operating outside the legal framework.
Whether the premier was being deliberately ambiguous or was genuinely confused wasn't clear. But the next day, some of his Cabinet members were scrambling to clear up some of the misunderstanding caused by the boss' off-the-cuff and exciting pledge.
They declared that the scheme had nothing to do with "offbeat" debts. The relief plan was to be confined to about 100,000 salarymen whose borrowings had already classified as NPLs (non- performing loans) by financial institutions.
But the premier was talking about cracking down on illegal loan sharks and coming to the rescue of their victims -- so much so that the bankruptcy law would be amended to allow indebted salarymen to declare themselves bankrupt and seek protection from bloodsucking lenders.
Indeed, the premier even suggested that the US government was coming up with similar legislation to the same effect, hadn't he?
Well, said another close aide, you'll just have to ask the prime minister about that. "We are dealing only with financial institutions offering haircuts to salarymen men with NPLs with up to Bt200,000 debt each. It has nothing to do with bankruptcy laws," another officer told me.
Rumors have been running rampant. Most honest, hard-working taxpayers are crying foul. Is their tax money going to be squandered by the government in another last-ditch populist scheme yet again?
What's the incentive for law-abiding, God-fearing citizens to remain frugal and industrious, and responsibly keep paying taxes, if the government decides to pick 100,000 bank debtors spread all over various fields (farmers, city workers with credit cards and small-time real estate speculators) and declare them eligible for this special grassroots debt-relief plan?
The premier has yet to effectively dispel rumors that he was contemplating amending bankruptcy laws to allow anyone with Bt200,000 of debt to seek bankruptcy status in order to be protected from creditors.
What's more puzzling is Thaksin's statement on the radio that each "bankrupt" person in question would be permitted to keep a house and a car after being given a substantial "haircut" from their creditor bank.
It wasn't long ago that the prime minister was telling all the common folks to learn one of the biggest lessons from his own life experience: Don't be afraid to borrow money.
In fact, being in debt was a sure way to getting rich. "Look at me, I wasn't afraid to be in debt. In fact, I was writing post-dated cheques to survive and look how rich I became," Thaksin once said in so many words.
For quite a few admirers of the super-CEO's style, being in debt was the "in" thing, the only sure way to success. Whether you could repay your debts wasn't a serious issue.
Now, to really say that you are follow the latest social trend -- which has official support from no less a person than the prime minister himself -- you have to take it a step further: Declare yourself bankrupt.