ALL THAI'D UP IN CORRUPTION

27-09-2006

It's amazing - the leader of a democratic country has been overthrown with barely a squeak of protest from the international community or his own people. So how has Thaksin Shinawatra, the Prime Minister of Thailand suddenly becomeso unpopular? One British expat offers this jaw-dropping explanation.

Why do people hate Thaksin Shinawatra?

First of all it must be stressed that not everybody does, of course. He has been the most popular politician Thailand has ever had. His party, Thai Rak Thai (and he is the party), was by far the largest after the 2001 elections and the government formed around it was the first in Thai history to serve out its full four-year term. In the election of 2005 it won a landslide victory, polling 19 million votes and winning some 400 hundred seats in the 500-seat parliament.

Its primary base is the rural poor, who constitute approximately 60% of the population, but in the beginning the urban middle class also voted for Thaksin, seeing him as breath of fresh air in Thai politics: a clever, very successful businessman with lots of new ideas, a “can do” attitude and great marketing skills, and as the richest man in Thailand, surely far too wealthy to be corrupt?

Slowly but surely, and particularly since his 2005 election victory, Thaksin lost the trust of the urban population because of his policies, his autocratic style, his disdain for the democratic process, and most importantly, rampant corruption in the government on a scale never before seen, even here. The rural population and some of the urban working class still love him, though, because of his populist polices that have seen billions of Baht handed out to them in one form or another over the past 5 years.

So what about his policies? Nothing wrong with helping the poor and indeed many of Thaksin's ideas were very good. The problem has been their implementation.

He launched a cheap healthcare scheme whereby nobody would pay more than Baht 30.00 (about 40 pence) per visit to a government hospital. Great, except that it has always been under funded to the extent that many government hospitals are now on the brink of bankruptcy and the already over-worked and under-paid doctors and nurses are leaving in droves because they just cannot cope anymore.

The village-fund scheme saw one million Baht handed out to each of the country's 60,000 villages to help farmers improve their lifestyle; buy fertilizer, seeds, maybe a cow or a buffalo, etc. Each family could borrow 5, 10, 15,000 baht to be repaid after one year at which time the fund would start all over again, and it would all be administered by the villagers themselves with no government oversight..

What happened? The farmers boughtmobile phones and motorcycles.And who owned, sorry, didn't own, but whose family and various domestic staff owned the largest telecoms company in Thailand? You guessed it.

Now, seeing how government handouts could be really good for business and thus for the country, Thaksin dreamt up all kinds of other schemes to hand out tax-payers money to the rural population; to alleviate their poverty, he said. The result? Average household debt has trebled in the past five years and nearly everybody seems to own a moby.

It is these kinds of policies that have been so divisive. The educated middle classes have seen them for what they are while the less sophisticated rural population have tended to think that Thaksin was genuinely trying to help them. Then when urban Thais criticized the policies people in the countryside felt their interests were being disregarded by uncaring city folk.

With an overwhelming parliamentary majority Thaksin thought he could do anything and get away with it. He meddled in civil service, military and police promotions, advancing family, friends and sundry cronies at the expense of qualified professionals. He subverted the selection process of supposedly independent watchdog bodies such as the Counter Corruption Commission, the Constitutional Court, the Election Commission and the committees charged with overseeing the telecoms industry and the allocation of radio and television frequencies, to ensure that the majority of the members were sympathetic to his and government and/or his business interests.

He intimidated the press with multi-million Baht law suits if they wrote anything too derogatory and turned the television stations into government mouthpieces. Did I mention that he bought ITV, the only TV station not owned by the government? He indulged in policy corruption at the highest level. He went to India on an official visit and came back with a contract for the Indian Government to lease transponders on one of the satellites owned by the telecoms company that is owned by one of his maids, his chauffeur and various family members. He ordered one of the state-owned banks to make a multi-million dollar loan to the Burmese Government, which the Thai Government would guarantee, to upgrade the country's telephone system. Guess which Thai company got the contract to carry out the work?

I have mentioned a couple of times the shareholders of Shin Corp., the Shinawatra family business. When Thaksin first became Prime Minister he had to divest himself of all shareholdings in publicly listed companies. This is how one of his maids and his chauffeur both happened to own millions of Baht's worth of Shin Corp. shares, how his daughter became a Baht billionaire at the age of 19 and how his wife, son and son-in-law also all came to own large stakes in the very successful, but soon to be even more successful, company.

After the election he was charged by the Constitutional Court with concealing his assets. He said his wife handled all of that and he did not know anything about it. He was found not guilty. If he has been convicted he would have been barred from holding political office for five years. Another M.P. faced the same charges and claimed the same defence. He was found guilty!

Now we come to the beginning of the end (we trust) of Thaksin. At the beginning of this year Thaksin's family sold all their shares in Shin Corp. to Temasek, the investment arm of the Singapore Government. They made 73 billion Baht (about one billion pounds) and using various loopholes did not pay 1 Baht in tax. (Thaksin's son bought millions of additional shares from a shell company his father had established in the British Virgin Islands some years ago for 1 Baht each and sold them to Tamasek the next day for 43 Baht each, also tax free).

This so outraged people that it set off street protests demanding Thaksin's resignation and these continued on and off all year. (Of late it seemed likely that Thaksin's henchmen were about to start organizing counter demonstrations in order to provoke violent confrontations that would give Thaksin the excuse to declare a State of Emergency and assume almost absolute power. It was fear of this that prompted the army to move at this particular time.)

After the share sale the heat on Thaksin got very intense so in order not to have to answer any awkward questions he simple dissolved Parliament and called new elections. He said if he won again then obviously most people didn't care about share dealings so the protesters could just shut up. The opposition cried foul and boycotted the elections. TRT won, of course, but not that convincingly. Thai ballot papers have a “No vote” box, i.e. “None of the above”, and the No votes in many constituencies were the majority and nationwide were over 40%. There was a great deal of other skullduggery involved but really too much and too complicated to go into now.

This all led to further protests until His Majesty the King intervened, saying the country's democracy was in a mess and it was up to the courts to sort it out, if the politicians couldn't. The Supreme Court, the Supreme Administrative Court and the Constitutional Court then all got together and decided to annul the April election and call a new election for later in the year. This calmed things down for a bit but the political temperature was starting to rise again by August, as none of the underlying problems had been solved, and real trouble was on the horizon as mentioned above. Some people even thought the country could slide into civil war..

That's the gist of it. There was much more, of course; so much corruption, particularly regarding the new airport, it would take a book to detail it all, so much more undemocratic and arrogant behaviour and so many more shady deals. I hope, though, this helps to explain why the coup has generally been welcomed and why currently 80% of Thais support the army's action. Even Thaksin's supporters have, by and large, accepted that it was probably the only real solution to the impasse.

Andrew in Bangkok