Royals, capitalists, and inequality

An op-ed at both Asia Sentinel and Eurasia Review, titled “Hierarchy, Power And Inequality In Thailand,” and published a few days ago, there’s a useful, short account of the country’s oligarchy. We reproduce the interesting bits:

Although Thailand is one of the region’s wealthiest states and has been cited as a success story of modernization and development, the gap between rich and poor is widening. Thailand is placed in the world’s top inequitable countries, in terms of wealth and income distribution.

According to a recent Credit Suisse study, one percent of the population holds 66.9 percent of the nation’s wealth, with 36 percent of equity held by only 500 people. According to the World Bank, poverty has grown from 7.21 percent in 2015 to 9.85 percent in 2018.

It has probably grown further with the impact of the virus.  The article then moves on to the oligarchs:

While more Thais are struggling to make ends meet, sections of Thailand’s elite class have been increasing their wealth. A survey by Money and Banking Magazine with the Faculty of Commerce and Accountancy at Chulalongkorn University using Stock Exchange of Thailand (SET) data, found that Charoen Sirivadhanabhakdi, the founder of Thai Beverage and chairman of the TCC Group, Vonnarat Tangkaravakoon, chairman of TOA Paints, and Khunying Wanna Sirivadhanabhakdi, chairperson of Sangsom Group and Beerthip Brewery, had actually increased their wealth during the pandemic.

Notice that three are mentioned but it is only two families. The discussion adds:

Thailand is economically dominated and ruled by a small close-knit elite composed of the monarchy, the military, and a small number of families who control Thailand’s major businesses. This small group is interrelated through family ties, intermarriage and long-held relationships.

Don’t for a moment think this is something recent. Back in 2011, PPT posted on “maps” of elements of the ruling class going back to the early 1950s. For us, what has changed is eerily reminiscent of the destruction of symbols of 1932. The ruling class has been re-sculpted to be royalist.

From 1932, the People’s Party and the regimes that followed, at least until World War 2, had altered the nature of the ruling class by limiting the monarchy and the princes.

It was the ninth reign that changed this. One of Bhumibol’s great successes was in rebuilding the monarchy’s enormous wealth. Forget all the propaganda about royal projects and a frugal king. He was a determined acquirer of wealth. He did this in alliance with the military and selected Sino-Thai capitalists. It is that arrangement which produced the oligarchy of today. Some of the names have changed, but there’s continuity too.

Of course, many of the top generals did exceptionally well. A much-neglected and very detailed doctoral dissertation by David Morell, “Power and Parliament in Thailand: The Futile Challenge, 1968-1971” has lots of data, including claims about the wealth and economic connections of the top generals who were also ministers. Here’s a taste:

Thailand has long been a highly unequal society, and the palace, the military and the connected capitalists will fight tooth-and-nail to protect the inequality that allows them to suck the wealth from the country. That also means controlling politics. As the op-ed has it:

Right-wing political groups with monarchist ideologies developed, representing the elite. The elite classes were boosted with ethnic Chinese business families, civil leadership developed at both provincial and local levels, and military personnel. Nationalism and monarchy became more important than democracy, a doctrine which has been espoused to maintain the establishment grip on power beyond question. This espoused cultural-political concept of ‘Thainess’ totally encapsulates the need to maintain status quo of the position of the elite within politics and society.

Students rolling, royalists reacting

As demonstrations continue, it might be expected that the young students and their supporters might be losing some support by demanding reform of the monarchy and calling for an end to the military-backed regime, both seen by conservatives as the cornerstone of the status quo.

In fact, this doesn’t seem to be happening. The Bangkok Post reports two surveys, one by the seldom trustworthy NIDA Poll with 1,312 respondents and another by the Suan Dusit Poll which claims 197,029 respondents. Go beyond the headlines, and it seems that a large majority support the students and their headline three demands. It also seems that support for the regime has dropped even more.

In the most recent demonstration in Khon Kaen, a statement was issued and called:

for an end to intimidation of the people, the government’s legal action against people with different opinions, inequality in education, inequities in the justice process and the plunder of natural resources.

“We want rights and freedom and human dignity because we are not slaves. We want a democracy which belongs to the people. We want equality in education and true justice in the judicial process. We want the decentralisation of power and the right of communities to manage their own resources. We want a new democracy….

Interestingly, several of these demands have ideological continuities with the rights demands heard during red shirt rallies a decade ago. That seems organic in the sense that many of today’s protesters were very young when the red shirts rose.

When the military has its government pad out its budget through rubber-stamping in parliament, the students get more supporters.

Regime and royalist reaction is pretty much what might be expected. As well as giving the military more kit, the regime is shoring up its support among the top brass. An example it Gen Prayuth Chan-ocha’s likely pick for next air force boss. Apparently, the job requirement is that the appointee must be “intelligent, ethical, dedicated and loyal to the monarchy.” We doubt the first two criteria can be fulfilled along with the last requirement. The other loyalty must be to the regime’s leaders.

Rightists are straggling along, as yet not well organized. This means they flop back on old tactics. For example, the “independent” agencies are used to undermine those various rightists think are “behind the children.” So it is that serial complainer Srisuwan Janya “says he will petition the Election Commission (EC) to look into whether the Move Forward Party (MFP) broke the law on political parties by proposing to amend the constitution’s Chapters 1 and 2 which contain general principles and sections associated with the monarchy.” Who pays him?

And surveillance and repression continues. As would be expected, “[s]ecurity agencies are keeping an eye on political activities ahead of a planned student rally on Sept 19 to prevent protest actions that may lead to violence and unrest…”, painting a picture of “Hong Kong violence,” obviously seeking to influence and agitate the Sino-Thais of Bangkok and linking to yellow-shirt ideologues who follow Russian troll sites on “color revolutions.”

They are also seeking to limit protest growth through political alliances with groups like the Assembly of the Poor. Hence last week’s arrest of the Assembly secretary-general, Baramee Chairat, for alleged offenses at the 18 July rally.

We doubt that these military and police spies are about preventing violence and are more about preventing protest and agitating against the “children.”

There’s a long road to be traveled.

The rich get away with murder

It is reported that “police have opened an internal investigation after charges were dropped against the billionaire Red Bull heir … amid outrage over a perceived culture of impunity for the rich…”. We see this as nothing more than a part of a continuing effort to kid the public that the police are interested in justice. It is also about the regime’s “management” of discontent.

While in a source PPT doesn’t usually read, we felt that Benjamin Freeman’s op-ed was useful in reflecting on the question: “Why do the rich and powerful get away with murder?”

Commenting on the Red Bull-Vorayuth Yoovidhya saga, Freeman states: “And so it goes in a country where the rich and powerful can get away with murder — literally so, as this case indicates.”

The author agrees with Pol Col Kissana Phathana-charoen who explained that dropping charges against the rich, Ferrari-driving, coked-up Vorayuth did not mean that the police were “applying double standards…”. Freeman observes:

We have to take him at his word. In order for there to be double standards, there need to be some real standards in the first place. But what exactly are the standards of Thailand’s law enforcement and judicial system?

Strikingly, he links (in)justice to broader political events:

This is a country, after all, where a citizen can be sentenced to long years in prison merely for exercising freedom of speech by making critical comments about the government or the monarchy on social media on grounds that doing so undermines national security.

Meanwhile, the generals that spearheaded a military coup to overthrow an elected government in 2014 not only do not need to fear any prosecution for what was an act of treason by international standards but they remain in charge of the country, acting as they please.

Freeman explains:

The system of justice in Thailand has long stayed mired in a regressive state where the laws apply only to those who don’t have enough money or influence to be able to flout them at will.

The result is a vastly unequal society where the “little people” remain under the thumb of the rich and powerful who can do as they please with no one to hold them to account.

He might have added that this inequality of wealth, power and justice is exactly what the tycoons want and is why they support dictators, military and monarchy.

Patronage and ideas sclerosis

Readers will be over the moon to learn that Gen Prayuth Chan-ocha’s request for help from Thailand’s filthy rich billionaires has received a positive response:

Thailand’s top business leaders are ready to help the government ease the crunch of the coronavirus crisis, and plan to offer their ideas to lift the country out of the economic quagmire.

There was much mutual back-slapping and self-congratulations:

Suphachai Chearavanont, chief executive of Charoen Pokphand (CP) Group, “hailed the prime minister’s gesture as a smart move.”

He compared Thailand’s wealthiest to ministries:

Each of the businesses is like one ministry. They are from the real sector and they are running their own micro economy. If they work under the government, the prime minister will automatically have twenty more ministries working for the administration….

A Bangkok Post editorial notes that Gen Prayuth “wanted the rich to do more to ease the suffering of the masses,” urging them “to propose tangible projects in writing by next week on how they can help more.”

The editorial proclaims: “Requesting the captains of industry to help the country during a crisis is not wrong.” It might be asked why he even has to do this.

One reason is that it is “natural” for those in a symbiotic relationship to rely on each other. Since at least the late 1950s, the relationship between the wealthiest capitalists and military rulers has been cosy and has resulted in massive exploitation of people and environment. The military has created a social order where the rich get richer and the very rich are bloated, with cash flowing to them from multiple state coffers, semi-monopolies and corrupt relationships.

A second reason is that the junta post-junta regime is bereft of talent and ideas. As worshippers at the fount of great wealth, that’s where they seek “ideas.” The trouble is that most of these Sino-Thai tycoons live in a cocoon of inter-married families, royalism, nepotism and exploitation and know little of the world of those of Comrade Gen Prayuth calls the “masses.”

In fact, he should have gone farther, asking that more people on the top of the national wealth pyramid pitch in.

The Post editorial states it “is indisputable that many business moguls have long reaped the benefits of crony capitalism. They have utilised greater resources in the country to create wealth, inevitably widening the inequality gap.”

Observing that “Thailand is among the 10 most unequal countries” in the world, it notes that those with great wealth “have enjoyed the advantages of the political patronage system.” (We recall when Jakrapob Penkair got into terrible lese majeste trouble for his description of Thailand’s patronage system.)

Yet the Post – it is owned and operated by tycoons – feels the need to defend the beneficiaries of the patronage system, saying the the huge income gap “does not necessarily mean that these billionaires are villains. They have contributed greatly to the country and the economy, created a large number of jobs and developed many social projects.”

They have created businesses that have made them hugely wealthy on the backs of poor farmers and workers. They have used some of this wealth to grease the wheels of bureaucracy and military, adding to their wealth. They have funded the monarchy, cementing a ruling class in power for decades.

When they “give,” they do so for reasons that grow their wealth and power.

It even gets into some fake history, declaring: “The Chinese ancestors of several billionaire dynasties successfully established business empires in Thailand without state support.” Which are they? We can’t think of any.

Many old books on Thailand’s capitalist class tell a different story (see, for example, Bankers and Bureaucrats (PDF), Capital Accumulation in Thailand, and even Chinese Society in Thailand: An Analytical History.

The Post reckons that asking the “super-rich” for help “does more good than harm.” There’s no evidence for this. The ideas they’ve come up with so far suggest idea sclerosis.

Has anyone looked at how much or how little tax these tycoons pay?

Tycoon panic

Thailand’s Sino-Thai tycoons, many of them in retail and basic consumer goods, have probably done better than most as the virus crisis bites.

However, their panic looks class-based as they worry about “disunity,” with the headline, “Tycoons urge unity amid chaos.”

The story has them “urging members of the business community to join hands with the government in cushioning the economic impact of the Covid-19 outbreak…”.

Thai Chamber of Commerce chairman Kalin Sarasin says that tycoons “including Charoen Pokphand Group’s Dhanin Chearavanont, Singha Corporation’s Santi Bhirombhakdi, Saha Pathanapibul’s Boonchai Chokwatana, and TCC Group’s Charoen Sirivadhanabhakdi…” have agreed on measures to “help soften the blow of the coronavirus outbreak.”

As far as we can tell, they are most interested in PR.

Will they do anything to “strengthen… the competitiveness of SMEs, enhanc[e]… workers’ skills and bridg[e]… income gaps”? We doubt it. They’ve done next to nothing for decades in these areas as their own empires have expanded and they have become monumentally rich.

In any case, the Chamber seems to want government to do the work. As Kalin said, “TCC’s suggestions are always well accepted by the government.”

And, they reiterated the usual blarney: “Kalin said these tycoons also praised the TCC’s efforts in supporting the government’s Pracharath scheme, promoting good governance and adopting the sufficiency economic philosophy.”

In other words, the tycoons are protecting their interests and ideologically barricading themselves.

Two new articles

There are two new and interesting articles by academics to add to our recent listing.

One is by James Buchanan at New Mandala. In “Is the era of ‘Red versus Yellow’ over in Thailand?” the author seeks to present an understanding of how politics has changed (or not) in recent years. We find his argument quite convincing. However, there has been some negative response on social media, suggesting that observers of Thailand’s post-coup politics are splintering. Helpfully, this article also has a Thai version: ยุคของ “แดง ปะทะ เหลือง” ในประเทศไทยจบแล้วจริงหรือ?

Another article is by Kevin Hewison at the Journal of Contemporary Asia. His abstract states:

This article provides an account of the upper echelons of Thailand’s capitalist class. Based on an analysis of the Forbes data on Thailand’s wealthiest for the period 2006–2019, it analyses the 30 families and groups that have dominated these rankings over this period. The article compares how the growth of this group’s wealth has outpaced other measures of how Thailand’s economy has grown over this period. The article also compares this Forbes-ranked group with the upper reaches of the Thai capitalist class in 1980, assessing wealth and investment between the most important capitalist groups in 1980 and those in the Forbes rankings for 2006–2019. It finds considerable consistency within this category, in both periods and over time.

The article is behind a paywall. However, as we have stated previously, authors are generally willing to help out with copies for those without access.

Obscene inequality

Agence France-Presse has an interesting report on the fabulously wealthy in Thailand. It begins by noting that Thailand “has 50 billionaires – ninth in global rankings – [while] 14.5 million people live on welfare…”.

It adds that wealth – or inequality – was “a hot election issue this year…”. In fact, PPT can’t think of an election this century where the inequality of wealth has not been an issue. Thailand has long been at the top of Southeast Asia’s inequality rankings, going back to when estimates were first made in the early 1960s.

The hook for the AFP story is the absurdity of the ridiculously rich playing and watching polo that witnesses “teams of jodhpur-clad Argentines and moneyed Asians gallop onto the flawless field in Chonburi as spectators spill from a pavilion – glasses of champagne in hand – for the final chukka.”

The so-called sport of kings is obscenely expensive limited to royals and the obscenely rich. We have mentioned it in a couple of posts. As well as the King Power Srivaddhanaprabha family others in jodhpurs include naturalized billionaire Harald Link. Polo allows Thailand’s hugely wealthy to hobnob globally with royals and the obscenely rich. That includes the British royals, Brian Xu, of Shanghai Marco Stationery and Sultan Abdullah Sultan Ahmad Shah now the Malaysian king.

The article notes that Thailand is home to polo because “royalty, wealth and elite networks are cross-hatched into the social fabric.”

Interestingly, the article cites Kobsak Pootrakool of the junta’s  Phalang Pracharath Party, lamenting the huge inequality in the country. He states that “[t]he top 20 per cent own 80 per cent of wealth…”. He should know as most of the very wealthy support his side of politics.

It’s actually even more skewed that that. The Credit Suisse Global Wealth Report had 1% of the richest Thais controlling 66.9% of the country’s wealth in 2018. And that probably doesn’t include a calculation for the obscenely rich monarch.

In contrast, as the report observes, “[m]ore than 14.5 million Thais qualify for welfare, with most of them earning less than US$1,000 a year.”

The report also notes that a feature of Thailand’s politics is the military coup, usually “with the support of much of the Bangkok-based elite, who underpin the kingdom’s sharp hierarchy and bristle at economic and political challenges from below.”

It is wryly observed that “[c]ash … cascades down family-run businesses, whose monopolies are inoculated against competition by friends and family in politics and generous tax breaks, while generals sit on company boards.”

The military’s task is to ensure the poor do not rise. When they have, it has jailed, beaten and murdered them.

Future Forward’s Thanathorn Juangroongruangkit, himself a scion of huge wealth, declares: “Inequality won’t be solved … unless that clot of power and money is removed,” warning that inequality is “a threat to stability in the country.”

We doubt that many in the polo set and their hi-so brethren care much at all, recognizing that their wealth depends on the state’s largess and the capacity to exploit workers at will and destroy the environment.

That allows the obscenely wealthy to party obscenely, collect palatial condominiums and super cars by the score, travel the world and buy a “justice” denied the poor.

Thirayudh among the chickens

In his annual musing about Thailand’s politics, usually delivered in a seasonal scruffy cardigan, one-time student activist, former communist, former critic of the monarchy, anti-democrat and “academic” Thirayudh Boonmee has delivered another of those waffling pronouncements that can be interpreted in several ways.

When he “likened Thai people to chickens in farms where they were under control from birth to death” it seemed that he took this as a state of affairs to be accepted.

He seemed pessimistic about “politics”, arguing that “Thais are too obsessed with political problems to realise they face other, more fundamental, issues — inequality, poor education, widespread corruption, and economic monopoly by large groups of capitalists.”

It seems quite strange to think of inequality, poor education, corruption, and capitalist oligarchy as being apolitical. We would consider such outcomes to be a result of Thailand’s anti-democratic politics, long periods of authoritarianism, the impunity of military murderers and the triad of military-monarchy-tycoon capitalists.

He seems to suffer a dementia moment when he falsely claims that it has been “[o]ver the past decade, [that] about 10 large groups of capitalists had been formed and they controlled most key economic sectors and politics…”. Most of the giant capitalists group have been around for decades and almost all align with the biggest capitalist conglomerate, the monarchy.

He’s on stronger ground when he observes that the military junta:

had long planned to prolong its hold on power by allowing political parties to nominate outsiders as prime ministerial candidates, having 250 military-appointed senators with the right to vote for the prime minister, and by gathering political factions into the Palang Pracharath Party. All without caring about any criticism.

PPT has been saying that for a very long time. For most of that time, Thirayudh has been a junta supporter.

He’s certainly not alone in seeing that The Dictator has “a very big chance of … remaining the prime minister after the general election…”. The question is whether one supports that rigged outcome or not, and we think Thirayudh is comfortable with more military domination of politics even if he notes the problems politics “under the influence of the military, government officials, the intellectual elite and large groups of capitalists” brings.

He reckons that if the junta doesn’t engage in outright electoral fraud, “people would accept the next government of Gen Prayut[h Chan-ocha]…”.

Thirayudh’s claim that the junta’s government and its returned regime after an election is/will be little different from the Thaksin Shinawatra regime is amusing but inaccurate.

At the Bangkok Post, The Dictator himself is dismissive of Thirayudh as an aged dope in this comparison. Prayuth then babbled that Thaksin did wrong.

Overall, Thirayudh is boring, deceptive and deliberately forgetful. It’s time he stopped relying on his reputation of more than 40 years ago and gave way to a younger generation of real democrats.

Screw the workers or the junta is screwed

Organized labor in Thailand is struggling to stay organized. For decades business and the state have worked together to ban and then repress organized workers. Labor laws are flouted, employers have officials in their pockets and on their payroll, and leaders of workers at the factory level are harassed and threatened.

Wage setting in Thailand, which revolves around the maintenance of what was once a daily national minimum and is now set for provincial zones is essentially a bipartite process as workers and state decide on what the minions in factories, shops, offices, malls, hotels, boats, fields and so on will be paid. It was only about a week ago that this committee set the new minimum wage.

The decision set seven wage rates from 1 April – 308 baht, 310 baht, 315 baht, 318 baht, 320 baht, 325 baht and 330 baht. The average minimum wage was about 316 baht with rises ranging from 2% to 7% above current levels. For workers in the provinces who will now be getting 308 baht a day, that’s a rise of thus see a wage rise of 8 baht since 2012 or about 0.4% a year or 1.3 baht per day. At the highest rate, it is 1.7% a year or 5 baht a day.  A bus ride on a regular non-a/c bus in Bangkok is 8 baht.

Calculated as a yearly rise, the highest rate for someone working every single day of the year on this new minimum wage would earn enough to buy 7.6% of one of General Prawit Wongsuwan’s watches (at the estimated average cost).

Those pitiable rises were due to be approved by the junta’s cabinet yesterday, with the “Ministry of Labour …[to] also propose an exemption from the wage stipulations for the provinces in the government’s flagship Eastern Economic Corridor development project…”. How that makes sense is beyond us. We would have thought that you would want your workers in your flagship establishments being your most productive and best paid. But this is a military junta making decisions….

Unfortunately, even these small wage increases (which many firms ignore anyway) are just too much for Thailand fattened business class. The Nation reports that the bosses are rebelling, demanding that the junta “go back to the drawing board on the recently announced rises in minimum daily wages [saying] that its members say do not reflect the different economic conditions across the country.” Kalin Sarasin, chairman of the The Joint Standing Committee on Commerce, Industry and Banking chairman of the Thai Chamber of Commerce, says 92% of business owners “in all provinces agreed that the rises announced for 2018 are higher than the rates that had been proposed by the provincial wage committees. This meant that small and medium-sized enterprises (SMEs) and farmers could be hit hard by the higher wages, which they say are not adequately based on economic conditions in each area of the country…”.

Business owners are used to having cheap labor. That’s been one of the state’s main roles over decades of economic development. That’s why inequality remains at Latin American and African levels. That’s why, in 2016, the top 1% in Thailand controlled 58% of all wealth and why the top 10% gobbled up 80% of all wealth in the country.

Greed is one thing but we think the political threat from organized business is also clear. The message is: help us on blood-sucking wages and we will continue to support The Dictator and his men. If the junta fails, its political future is dimmer still.

Journalists do the state’s work

The Associated Press’s report on Red Bull family is worth reading in full. It is getting considerable international attention for issues of tax avoidance and the unaccountable power that comes from great wealth in Thailand (and elsewhere).

We won’t repeat it all here. We do recall that, back in May,

“Red Bull scion Vorayuth Yoovidhya, the suspect in a brutal hit-and-run case in which a police officer was killed, gave authorities the slip once again by leaving Thailand for an unknown destination on April 25, just two days before he was due to answer charges over the 2012 incident.”

Five years after the allegedly coked-up and drunk rich kid ran over a cop and drove off, dragging the body along, to hide from the law in his gated and guarded family home. Lawyers and fixers got to work.

Five years have produced no justice. How can that be? Vorayuth lived the high life around the world as he avoided justice. Some police and others with power in Thailand were obviously complicit.

PPT said that this case demonstrated how Thailand’s (in)justice system doesn’t work, except for the junta when it wanted to lock up the poor and political opponents.

Vorayuth’s flight and high life around the world was revealed by AP (not the Thai authorities) back in March. It was AP researchers and reporters who tracked him down in London.

Why is it that journalists do this investigations while Thailand’s leaders and state agencies remain silent.

AP’s pursuit of the Red Bull killer and the continuing (manufactured) failure of the Thai authorities to track down a scion of one of Thailand’s richest ($12.5 billion) and most influential families has led to the latest AP story.

Thai authorities will probably now issue statements about how they have been “investigating,” but then go back to their legal slumber, induced by the influential.

AP has trawled the Panama Papers for this story and investigated the Yoovidhya family’s secret money trail, its tax avoidance minimization and its extraordinary efforts to conceal all of this. Their concealing of ownership even baffled Mossack Fonseca, the company that managed its international transfers and concealing.

On Thailand’s failures, the AP story makes that wider than just the Red Bull family:

While other governments were swift and aggressive in responding to Panama Papers revelations, that has not been the case in Thailand. More than 1,400 Thai individuals were identified in the documents, but the government calls the reports rumors with no evidence.

Last year, Thailand’s Anti-Money Laundering Office said it was investigating more than a dozen of those individuals — unnamed current and former politicians and business people. To date, that office has not reported any crimes, however, and it would not answer AP’s questions.

The rich and powerful in Thailand can get away with murder. Readers will soon realize just how scary these plutocrats can be when the AP story interviews Viraphong Boonyobhas, the director of Chulalongkorn University’s business crime and money-laundering databank. It is added:

Viraphong would not speak directly about the Yoovidhyas or any other Thai person or company, saying he feared for his legal and physical safety, but added that his expectations for accountability in the military-run government are low.

Thai authorities have vowed to fight corruption, but “wealthy people in Thailand are influential people,” Viraphong said. “Maybe the government can’t untangle such a complicated network.”

That’s a story about how Thailand is actually run. The whole system is not just built on double standards, but is structured to funnel wealth to the top Sino-Thai tycoons through corrupt military and bureaucratic machinery that, for a fee and reflected “barami,” covers money trails. Ideological devices associated with the obscenely rich monarchy are in place to make the greedy appear among the “good” people who slosh about in troughs of money.