The September 19 coup has not only brought an end to Thaksin Shinawatra. It has also destroyed New Money. Now Old Money is striking back.

It is like a blast from the past. Over the past six years, Thaksin was the chieftain of New Money, riding on the crest of the telecom boom. New Money challenged Old Money for pre-dominance over Thai society. There were 10 families - including the likes of Shinawatra, Damapong, Wongsawat, Mahagitsiri, Maleenont and Jungrungreangkit - who formed the core of the New Money. Through siblings, business and political connections, New Money wanted to change Thailand's political landscape for good.

The bankers embody Old Money. But the bankers got hurt very badly during the 1997 financial crisis. The IMF, the World Bank and the tough capital adequacy requirements they imposed on the Thai banks almost destroyed the bankers' family fortunes. Still, Bangkok Bank, Kasikornbank and Siam Commercial Bank have managed to survive Thailand's worst crisis ever to hit that sector. The Wanglee clan, who used to own Nakornthorn Bank, lost their shirts. The Chearavanonts, who control the CP Group, should also be counted as Old Money, but they went on to ally themselves closely with the Thaksin regime. Charoen Sirivadhanabhakdi, the liquor tycoon and another member of Old Money, has steered clear of politics, brilliantly charting his own course.

Over the past decade, Old Money has been heart-broken again and again. When Thaksin rose to power in 2001, he did not trust Old Money at all. He still could remember the days when he was struggling to build up his telecom business and had to go down on his knees to beg for loans from them. Thaksin did not conceal his contempt for Old Money. He considered himself ahead of his time. He was in the booming telecom business while the bankers still made money the old-fashioned way from interest-rate spreads. He was a self-made man, racking up more than US$1 billion within one generation when he was in his mid-forties. It had taken several generations for Old Money to accumulate the wealth Thaksin had in just one.

So when Thaksin took over Thailand, he would not share power with Old Money. The bankers were heartbroken again for failing to climb into the bandwagon. Still, the Chearavanonts became a reluctant partner in his regime, while the Sophonpanich family was kept at arm's length, in the outer circle. Kasikornbank was completely left in the cold. Strangely enough, Siam Commercial Bank would ally more closely with Thaksin than other banks - so close, in fact, that it got the Shin Corp deal.

At the height of Thaksin's reign, the Shinawatra Tower, which is the headquarters of Shin Corp, was the centre of power. It was here that Boonklee Plangsiri presided over Shin Corp as chairman. But he would also work for Thaksin as one of his most trusted aides. Most of the important deals had to pass his scrutiny first. Dr Prommin Lertsuridej, Thaksin's secretary, was also a former Shin Corp man, whom Thaksin trusted the most. The trio effectively managed Thailand like a company. But the coup brought New Money down like a house of cards. The National Counter Corruption Commission and the Asset Examination Committee are building up corruption cases against New Money.

The balance of power is shifting back to Old Money. Bangkok Bank has emerged stronger than ever from the financial hangover, with all the benefits of its long-standing political and business connections intact. It is now the strongest bank of all, having benefited most from this power shift. Siam Commercial Bank is also a new force to be reckoned with. Kasikornbank has yet to carve out a patch in this new ballgame.

Bangkok Bank has nurtured an elite camp under its roof. General Prem Tinsulanonda, the president of the Privy Council, is the bank's honorary chairman. Prem's power and prestige was demonstrated when, not long after the coup, Pojaman Shinawatra, wife of the deposed Thaksin, visited his residence with her tail between her legs. That event showed who really called the shots in Thailand. Bangkok Bank has sent Kosit Panpiemras, its executive chairman, to become deputy prime minister and industry minister. Bangkok Bank dislikes liberalisation. Kosit also does not trust any policy that too hastily pushes open the Thai economy. He and MR Pridiyathorn Devakula, the deputy prime minister and finance minister, another rising star of Old Money, are on good terms. Together, they are undoing the legacy of the Thaksin regime.

If all this is not enough, Bangkok Bank will also field Dr Amorn Chandarasomboon, one of its directors, to play the most influential role in drafting the new constitution. Amorn, Thailand's foremost expert in public law, is likely to chair a 35-member constitution drafting committee.

Since New Money has destroyed Thai democracy, it is now time to prevent New Money from re-entering politics. The underlying theme of the new constitution is that it will prevent the New Money capitalists from holding political parties and MPs as their hostages. MPs might be able to run for office on an independent ticket. The bureaucrats will dominate the Senate again. A mechanism will be built in to prevent politicians from meddling with independent institutions.

Old Money is indeed starting to reclaim its chocolate cake and eating it. If you want a sure bet, go for BBL and SCB.

Blog entries / Readers comments:

cynical thai 18/12/2006 14:30 To W, You replay the tape that everyone here knows. But you fail to discern the subtle difference between the royal circle and the elite. The term elite is very broad in its original meaning. This includes aristocrats, officials and leading professionals or technocrats in a modern sense. You should not confuse elite with royalties. You should not deepply stuck in the distant past as the society changes. The middle class now grows and prospers. You better move forwards and set the good example for the rest of us. Our King is working hard for all of us. He hardly travels abroad and learns almost everything that so many Thai hardly understand. He receives news and information in three languages. I hope you underrstand my point.

Graft Money 18/12/2006 08:15 Graft ill-gotten money was the disease that Thaksin wanted to spread all over Thailand. His graft money spread out to the poor venal villagers and these villagers were corrupted. 14 million of them were so hooked on Thaksin's graft money they were quickly enlisted to become Thai Rak Thai party members. Thaksin's graft money moved on to suborn institutional checks & balances, the judiciary, the police and even the generals. Graft money is the disease that will weaken the moral timber of Thai society.

W 16/12/2006 14:47 Answer to cynical Thai: I can't believe that some Thais will not know even a tiny,tiny fact of the true history of Thailand and Siam. To say that old money, BKK elite, ROYALIST group never destroy Thailand or the new generation of Thailand is either plain stupid or delusional by the royal lies and propaganda. Let me teach you some truthful Thai history: SENI PRAMOJ,KUKRIT PRAMOJ AND THEIR ROYALIST GANGS USE A SMEAR CAMPAIGN AND FALSE ACCUSATION ON RAMA 8 DEATH TO DESTROY PRIDI BHANOMYONG. LATER , KUKRIT AND HIS PAPER ADMITTED THEY LIED AND APOLOGIZED TO PRIDI. I HOPE AT LEAST THAI PEOPLE KNOW HOW MUCH PRIDI HAD ADVANCED,PRESERVED AND SAVED THAILAND/SIAM BUT HE NEVER BOW TO THESE "LOW LIFE" ELITE BKK ROYALIST THAT "CYNICAL THAI" SO GREATLY RESPECTED. RESULT: LOW LIFE ROYALIST KICKED PRIDI OUT OF THAILAND FOR LIFE. Another example: SARIT THANARAT, THE FIRST HERO OF THE ROYALIST AND RAMA9, KILLED JIT PUMISAK WHO WROTE THE BOOK ON THE TRUTH OF THAI SAKDINA, JAILED AND KILLED MANY THAI CIVIL RIGHTS LEADERS ON THE COMMUNIST OR LESE MAJESTE CHARGES, CORRUPTED THE COUNTRY THAT SARIT BECAME SO RICH AND HAD HUNDREDS OF HAREMS AND OWNED HUNDREDS OF THAI WOMEN AS HIS SEX SLAVES. RESULT: SARIT RECIVED ONE OF THE HIGHEST ROYAL ENDORESEMENTS AND COMPLETE SUPPORTS FROM THE PALACE EVEN AFTER SARIT'S DEATH. Another example: PREM, SURAYUD, AND ESPECIALLY SONTHI BOONYARATKLIN WERE CHALLENGED AND S0 AFRIAD OF LOSING POWER. RESULT: ROYALLY SUPPORTED COUP. Certainly cynical thai can respect any group of power and money as he/she wishes [KNOW TO BOW...,TRAINED AS ACHILD...], but my advice is; NEVER SAY THAT "OLD ELITE" NEVER DESTROY THAILAND OR NEW generation of money/power. This is not only because the facts are they did, have done and will always do exactly that, but more importantly saying so will make you "STUPID THAI" RATHER THAN "CYNICAL THAI" AS YOU HAVE WISHED. BOW TO EVERY NEW GENERATION THAI WHOSE FATHER ALSO HAD BUILT THIS COUNTRY, NOT JUST ONLY RATTANAKOSIN-BKK.

Drug Lord Money? 15/12/2006 22:08 Isn't it unusual that there was NO drug lord arrested or killed during Thaksin's Y2003-2005 anti-ya ba? Yet thousands of villagers, defenseless and poor, were slaughtered. Many Thais suspect Thaksin/TRT people profited really monstrously from the anti-drugs becuz those drug lords were paying handsomely NOT to be arrested. And whola! Guess what?

Devaluation Money 15/12/2006 20:52 'Old Money' was devastated by the 1997 Financial Crisis when the Thai Baht was devalued nearly bankrupting most of the 'old money' establishments. But 'new money' wonderkid Thaksin Shinawatra made a killing from the 1997 financial crisis. Thaksin was Deputy PM then in Chavalit's cabinet and Chavalit or Thanong whispered to Thaksin of the impending devaluation, and Thaksin and his Shinawatra profited monstrously from the Thai devaluation thereof.

Neutral Observer 15/12/2006 20:47 The thai banking system was involved in reckless lending, and so was Bangkok Bank. That was the main reason for the collapse of the Thai economy mid 90. In the western world with GNP in the area 30000 USD per capita it is no problem who owns the assets. A Swedish telecom group took control over Finland's biggest telecom company, a Finnish company took charge of Sweden's biggest pulp and paper company. So works the modern world. The Shin sale was good for Thailand. It injected a lot of money into this country. But some doesn't understand that to be a prosperous country, you have to give and take. What matter is that companies are operated efficient. The size is important. In China they understand this. The Swedish pulp and paper company Stora (=Big), founded in the 1600 bought another Swedish company in the mid 90s. The CEO of Stora was in TV, his comment "the size is important", said with a broad smile. Now Stora is eaten up by Finnish Enso. Thailand need to stop the thinking lek lek. This thinking is demonstrated in stupid game against the Shin deal.

neutrality indeed 15/12/2006 19:49 Thailand's export surged since 1960s. Foreign investment influx into the Kingdom is due to the country's sound economic policy. The Old elite or Old Money is actually an engine for economic growth. Even more, they never sold their business out to foreigners. What people posted here is another symptom of how Thai people perceive themselves in relation to the world. Mr.Panpieamrat is not to be held responsible for the financial crisis, as he was not the Governor of the Bank of Thailand. He was in private sector and had little power at the time. Do not distort any facts here since other readers here are very smart.

No Money 15/12/2006 19:45 Indeed the rest of us are all part of the No Money group.

'Looking for Money' 15/12/2006 19:24 All these talk of Old Money vs. New Money is making my head spin. What about my group - - and we account for the bigger part of Thailand? My Group 'Always Looking for Money' is after all are the very people who made New Money possible (we bought all the expensive cellphones and paid for all their lousy service) and permitted the Old Money to survive the 97Financial Crisis (we took all the Old Money's credit cards and shopped like crazy, including those earlier cellphones). Piss on both Old Money and New Money . . I think I've been had.

Neutral Observer 15/12/2006 16:52 Dear Thanong! I think there is much truth in what you have written this time. The coup was launched by one reason, Thaksin Shinawatra had become too powerful and popular. The Thai banks was a part of the mismanagement of Thailand mid 90. In any western country Mr Pampiemrad had been forced out of business. He had definitely not been seen as a qualified person anymore. The coup will do nothing good for Thailand, more people will understand that for every days that pass. The article above is good proof for that. Thaksin is accused of corruption, but not permitted to return to face justice. My Goodness! I hope Mr Khantong one day will understand the political play here. I hope that the poor people of Thailand will understand the paly over their head and their reaction will be swift.

Stone age economy 15/12/2006 15:28 Just like heaven. No worry of foreign intervention. No import, no export. We just barter trade among us. Turn bangkok into a vast farm land and barter trade centre for all Thais. 1,2,3 lets go - do it. No coup to change it please

Stone age economy 15/12/2006 15:22 Old money has resulted many coups in the past. We have to take reality check ourself from time to time in relation to the rapidly changing flattened world. If we choose to go back to stone age, so be it. Close all ties with the rest of the world. Do we really like this??? Just plant our crops, create our own industries. No tourist, joint ventures, foreign investment etc. What a peacful country.

cynical thai 15/12/2006 13:53 To W, I have never seen Old Elite destroy Thailand or New Money. I feel that the New Money burry the grave for themselves as they did not understand the Bangkokian at all. The Old Elite grew from the efforts of their long generations. Their finesse is very outstanding. They know how to bow to the Bangkokian elite and they were trained as a child. This is the strength of their class. Is it wrong for this class to maintain their status quo. It is this class which has safeguarded Thailand from foreign capitalist attacks. Who cares for Thailand? Their fathers built Rattanakosin - Bangkok. So they prepared to die here.

bangkokianpeople 15/12/2006 13:41 Well written and forceful. The Old Money understand the Thai politics and society better than the New Money who fail to make any compromise with the rest of Thai elite, due to their inborn arrogance. But it would be better to include other groups who have a close connection with the Old Siam, royal blood groups who declare to fight to the end.

W 15/12/2006 13:35 The article clearly show how small Thanong Khanthong's brain is. Ask yourself: Is it good for Thailand that old money take back control and monopoly of the country? Is it good for any nations that the privileged, "born to be elite" group will do anything to preserve their own status and destroy anyone who will challenge their power and status, even in an illegitimate, immoral and non democratic ways? Is it good for any Thai persons outside of the "old money group" that their children or grand children will not have a chance to compete, to own,to voice, or to be an equal human being just because they born as a poor, low class, poor educated children of Thai farmers, taxi drivers or laborors? I'm not surprised that ROYALISTS such as ANAND PANYARACHUN or Surayud or Prem or Sonthi try extremely hard to prevent low or middle class THAIS to have an equal shot at DEMOCRATIC GOVERNMENT by just lying that DEMOCRACY is not suitable for THAILAND. They have to do that because they are blue blooded ROYALISTS who have to think of themselves, their status, their power first and foremost. But I'm very surprised that ordinary THAI JOURNALIST such as THANONG KHANTHOG who is expected to be the voice of "poor and suppressed" rural thai people are willing to sell himself out to this group of ROYALIST. IS IT TOO HARD, TOO MORALLY CORRECTED FOR THANONG AND THE NATION NEWSPAPER TO STAND UP WITH THE POOR AND UNDERPRIVILEGED THAIS TO FIGHT AGAINST THE WRONG? OR IS IT BECAUSE THE OLD MONEY IS ALSO AN EASY MONEY FOR THANONG AND THE NATION?

Congrats 15/12/2006 12:25 This is such a wisely written piece. The core of the conflict is the Lamsam-Anand-Kasikorn group, symbolised by MR Pridiyathorn. Don't forget one point. Thaksin has a legitimate point in disliking the Old Money for never helping him, since he is not Hi So. But the Old Money sees itself and has been the protector of the society and culture, which Thaksin was ripping apart.

not disappointed 15/12/2006 12:02 Khun Thanong, your editorial is a little too pat and simple. It glosses over many other reasons and logic for the fall of the square face regime. It wasn't only about old vs new money; it was about a 'thief' and serial liar, in any clothing, that tried to rob and corrupt the country and its citizens of their democracy and basic human rights. Your expose does not contribute to the situation nor does it explain the real reason for thaksin's fall from grace. Don't just write something for the sake of taking up space in your editorial page. Write something that is articulate, logical and purposeful that can contribute to further discourse and thought. After many good articles, this one can be considered as one of your non-notable editorials.

disastrous scenario 15/12/2006 10:44 slurp, slurp, gush, gush.... you're wrong, new money did not destroy Thai democracy. OLD MONEY did - just because you repeat you pathetic pro-military mantra again and again, it won't make it become true. Thai people, [read rural Thai also-not just Bkk], won't allow the new Thai constitution to undermine democracy -or we will be doing this sad military dance over and over. Is that what you want ? A perpetual war between old and new money! This is a disastrous scenario for Thailand.

15/12/2006 09:30 Actually, the banks are the old new money. For really old money, look at the old families, the landowners, what are they up to?

Krid 15/12/2006 00:25 Interesting viewpoint, the old powers are taking over on every level. But is this good for Thailand? BBL is certainly the bureaucratic behemoth of Thai banks and banking with them can be very painful, especially for a new money foreigner used to modern and quick processes of the e-commerce age. BBL is an ideal match for the aging bureaucrats running this country.