Learn from Trump’s midterm defeat: Guan Eng warns Putrajaya over ‘phantom growth’

KUALA LUMPUR, Nov 5 — DAP’s Bagan MP Lim Guan Eng has cautioned the federal government to learn from the political fallout of the US midterm elections. He warned that merely presenting impressive economic figures will not shield Putrajaya from voter dissatisfaction if the average Malaysian continues to struggle with rising living costs.

Lim highlighted the Republican Party's loss in the Nov 3 US polls, where Democrats gained control of Congress after rejecting several of President Donald Trump's endorsed candidates, even in traditionally conservative regions. He pointed out that the US economy still grew by 3.4% in the third quarter of 2026, but voters were unimpressed as growth was uneven, resulting in a two-tier economy that neglected ordinary households.

Lim stated that Malaysia is facing a comparable situation, as evidenced by a 6% GDP growth in the second quarter of 2026. However, many small and medium enterprises (MSMEs) and individuals are complaining about what they call "phantom growth and controlled inflation," which does not alleviate their business woes or improve affordability and the cost of living.

Lim added that these issues are exacerbated by the government's recent increase in compliance costs and taxes. He argued that while top-line expansion has not helped to curb declining sales volumes, reduce margin compression, or make essential items more affordable, the government's recent tax hikes and heightened regulatory compliance burdens have only exacerbated commercial anxieties.

To address the issue, Lim urged federal ministers to leave their comfortable offices and interact directly with small business owners and employees from different ethnic communities. He also criticized bureaucrats at development agencies, which are meant to assist small businesses, for being "sleeping on the job" and called for them to actively promote policies that alleviate operational hurdles and boost commerce.

Lim concluded by warning that while Malaysian leaders might overlook Trump's political reversal, disregarding public discontent over everyday concerns could ultimately lead to the same result at the next election.