An Uneasy Calm in Thailand

By Greg Sheridan

SURELY even the angels wept for Thailand these past few weeks. The land of smiles is facing a terrible long-term crisis of governance.

It grieves me to say it but the country is facing a collapse of its politics. Don't be fooled by the good news of the past few days, that the red-shirt demonstrators have gone home, their leaders arrested after only a couple of deaths, and calm has come back to Bangkok.

The underlying conflicts have not been resolved and could well flare again at any time. My guess is the red shirts will regroup and wait for another opportunity to come back to the streets in a renewed attempt to bring the Government down. The challenge for Prime Minister Abhisit Vejjajiva is enormous. Abhisit is a good man. A genuine liberal, a very contemporary figure, highly intelligent and articulate, he now faces his hardest days.

For half the country does not accept his legitimacy. The crisis goes back to the military coup against the Thaksin Shinawatra government in September 2006.

Thaksin had won re-election in 2005. I met him a few times and found him smooth and very much in charge. There were good and bad features of Thaksin as PM. He ran effective economic policy, which is of enormous consequence. He also changed the political culture. He ran on certain policies and implemented them. He moved power away from the military, the bureaucracy and the cluster of senior figures around the palace, and towards parliament. He also concluded a free-trade agreement with Australia.

However, there were at least equally important bad aspects to Thaksin. He tolerated a great deal of cronyism and corruption in business matters. He continued to conduct his business empire while in office. He became increasingly autocratic towards Thailand's normally boisterous media. He sanctioned a savage anti-crime campaign in which a lot of people were killed. And he mandated a grossly clumsy and violent military response to Muslim politics in Thailand's south, which made a difficult situation a disaster.

Bangkok's liberal elite, but also some of its most traditional repositories of power, decided Thaksin had to go. Big demonstrations were held against him. Much that made Thaksin unpopular in Bangkok endeared him to the rural poor. They liked his nationalism and his economic populism, such as giving wads of government money to village chiefs to spend as they liked.

This is a central fault line in Thailand, between rich Bangkok and the rural poor, especially in the populous northeast. In some ways India has a comparable fault line, but the difference is when the rural poor elect a government, it is allowed to serve its term. In Thailand, governments are made in the countryside and destroyed in the city.

The military removed Thaksin and installed a pretty mediocre government in his place. Then came democratic elections at the end of 2007. Thaksin was not allowed to participate, but his allies won again. Less than a year later came mass demonstrations by people in yellow shirts representing the People's Alliance for Democracy. These demonstrators, though less violent than the red shirts, also paralysed the country, closing Bangkok's airports.

Neither the military nor the police acted against the yellow shirts. The courts ruled several key Thaksin allies ineligible for politics and through parliamentary defections Abhisit came to power in December last year. I admire Abhisit and believe he may still be the hope of Thailand, but from the point of view of the red shirts, they have a pretty strong argument that democracy has been repeatedly reversed. Thaksin won two elections and his allies won an election, and they are simply not allowed to govern.

Not a single yellow-shirt leader has been prosecuted, but the red-shirt leaders are in jail and facing prosecution. This is likely to deepen their despair about democracy.

Moreover, it is not clear even now how much power Abhisit really wields. The collapse of law and order and the consequent cancellation of the East Asia Summit at Pattaya last week was a grievous humiliation for Thailand. The police and military were told by Abhisit's Government to provide proper security for the visiting government leaders. Their failure to do so, I suspect, was not a mutiny but rather a sign of extreme reluctance to cause death and injury among demonstrators, as the Thai military famously did when suppressing demonstrations in 1992.

But the greater vigour of the police and military in suppressing the red shirts in Bangkok during the past few days, admittedly after pretty outrageous red-shirt actions such as blocking intersections with commandeered vehicles and ramming buses into police lines, does not necessarily represent a strengthened position for Abhisit's Government. Rather, it was probably a more or less autonomous decision by the Thai military that it had to act to restore basic order in the capital.

Will they do so again next time, or resort to another coup, or force Abhisit to hold new elections? Your guess is as good as anyone's.

The World Bank had this month already predicted a contraction in the Thai economy of 2.75 per cent this year. Given the devastation of the tourism industry, which accounts for 5 per cent of Thailand's economy and employs two million people, and the reluctance of foreign investment to flow to zones of instability, the economic situation will probably get quite a lot worse. And while the death rate in the Muslim insurgency in the south has declined in recent months, that situation is by no means resolved.

There are other potential sources of instability. The King, one of the most stabilising forces in Thailand, is in his 80s and in uncertain health.

It is difficult to know what Thaksin's personal strategy was in the most recent episodes. He spoke each night to the red-shirt demonstrators by phone or television hook-up, and there are rumours of assistance from him or his friends in organising the finance for the red-shirt movement. It is unclear whether this was opportunism by Thaksin or whether he has a long-term strategy to come back to Thailand to regain his wealth, if not his old political power.

The best way forward would probably be an election, but an election held tomorrow would see Thaksin's allies back in power.

The Thais for the moment seem to have lost the knack of democratic government, which means letting the other guys govern if they win the election. Once the pillar of Southeast Asian stability, this good friend of Australia is in for much more troubleahead.