Political revolts around the world have targeted what are widely seen as corrupt and unaccountable political and business elites — elites that pursue their own interests globally at the expense of ordinary citizens and regulatory regimes in nation-states. The result has often been the elevation of demagogues stoking xenophobic passions against not only elites, but minorities and immigrants. Yet one case — Malaysia — shows that demagoguery doesn’t have to be the inevitable consequence of elite misrule.
The scandal at 1Malaysia Development Bhd., the state investment fund more commonly known as 1MDB, has offered up a classic cast of apparent villains, from former Prime Minister Najib Razak and his wife, accused of siphoning hundreds of millions of dollars from the fund, to the bankers that allegedly helped them. Last month, for instance, the U.S. Department of Justice implicated at least three senior bankers at the Goldman Sachs Group Inc. in the alleged fraud.