The tussle at the bank shows that political warfare has now entered a financial battlefield; alarm bells are ringing for the economy
The crisis has thrown up yet another strange phenomenon. Friends have crossed paths at Government Savings Bank branches over the past few days, some there to withdraw their money while others were making new deposits. The only thing their visits had in common was that they were all political statements. In the latest case of national division, one side pulled money out of the GSB in protest against its “support” for the controversial rice price-pledging scheme, whereas the other camp wanted to “help” the bank “help” unpaid farmers.
The anti-government camp won this mini-battle of wills. Tens of billions of baht flew out of the GSB last week, eventually forcing its president to resign. Thailand’s political crises have furrowed plenty of brows over the years, but the creases are deepening now that the economy seems in genuine danger – because of politics. What happened at the GSB was remarkable because politically divided Thais are now taking a stand through financial behaviour.
Many hope this new tack is just symbolic posturing and won’t last. But who knows? When anti-government-protest leader Suthep Thaugsuban called for a national tax boycott, many laughed. What happened at the GSB will remind many of the protesters’ much-vaunted call for “civil disobedience”. Thailand’s crisis has demonstrated a tendency for delivering one big surprise after another. A bank president quit and a bank manager broke into tears over the politically motivated run on deposits. No one can be sure what will happen next.
With the ideological showdown threatening to spill into the realm of finance, politics has suddenly become far more complicated. Warning signs came before the February 2 election. While half the country joined the government in the “Respect my vote” campaign, the other half countered with the rallying cry “Respect my tax”. The result was that the majority of eligible voters appeared to reject the ruling party over its contesting the election unchallenged.
The GSB case offers a glimpse of what might happen to Thailand fiscally if the crisis worsens. Democracy, no matter what the idealists say, is only as good as the citizens’ ability to fund it. Of course, there must be the yearning for freedom and equality, but even something as noble as democracy requires good financing to support its foundations.
Which is why everybody involved must think hard. “Vote” and “tax” have to go hand in hand in a well-balanced way if democracy is to be effective and healthy. In Thailand, political formulas have been chosen, discarded, revived and dismissed again because we have been unable to find that balance. No matter how hard it’s become to find the right formula, the GSB issue must serve as a serious alarm call for a threatened economy.
It warns warring Thais that they must find a peaceful solution now while they still can. Today, the “withdrawing” and “depositing” friends can still take selfies together. The actions of Panthongtae Shinawatra and other GSB depositors are still largely symbolic, and, despite the massive funds withdrawn by “the other side”, the bank won’t collapse. But we ignore the significance of the GSB case at our peril. Among the various lessons this crisis has taught us, a very important one is that the hour gets late very quickly.