Three years ago, the architect of modern Malaysia ended his 22-year rule by handing over power to Abdullah Ahmad Badawi, a devoutly Muslim scion of the political lite. Dr. M, as the physician turned strongman is known in Malaysia, promised to exit gracefully?and quietly. For a while, he kept his word. Mahathir put together his personal library?which includes such diverse tomes as Euclid's Elements, Margaret Thatcher's autobiography and The Complete Idiot's Guide to Understanding Islam?and even opened a bakery on the resort island of Langkawi. But by June of this year, Dr. M could no longer hold his famously fiery tongue. Abdullah, he charged, was misguided in canceling several megaprojects the ex-PM had greenlighted, including a $4 billion railway and a proposed bridge to Singapore. Weeks later, Mahathir was hinting that Abdullah should step down, alleging corruption and nepotism within the new administration?albeit without offering proof of any wrongdoing.
On Oct. 22, the pair met for two hours, stoking hopes of reconciliation. No such luck. Last week, Mahathir continued to thunder against his handpicked successor, accusing him of involvement in the U.N.'s tarnished oil-for-food program in Iraq and of creating a "police state" in which Mahathir's criticisms could not be heard. He charged that Abdullah was dismantling his legacy?and Malaysia's future. "I thought that I have done most of the things that will serve us for the next 100 years," Mahathir told TIME at his Putrajaya office. "All that remains is for people to just continue. Don't reverse what has already been done." In a written response to TIME last week, Abdullah countered: "When I became Prime Minister, I encouraged more openness and did not want to muzzle different views. We are a democracy, and it is [Mahathir's] right to speak; he is free to say what he wants ... But it is unfortunate that he is making wild allegations."
Just days before the November general assembly of the United Malays National Organization (UMNO), the ruling party to which both Mahathir and Abdullah belong, party insiders worry that their ongoing feud could cleave a coalition that has maintained power for five decades. Certainly, Mahathir may be acting out of a wish to protect what he considers his?and Malaysia's?legacy, but the venom of his attacks suggests something more personal. "[Mahathir] wants to bring down Abdullah," claims Mohamed Nazri Abdul Aziz, Abdullah's minister responsible for law and parliamentary affairs, who also served under Mahathir. "He wants to force him to quit. He needs to be told he is no longer Prime Minister. His campaign is not for the sake of the country but for himself."
The tensions highlight the fundamental challenges that Malaysia faces. Since gaining independence in 1957, the former British colony has been transformed from a backwater nation dependent on rubber and tin into an industrialized regional power that is one of the world's largest producers of semiconductors and hard-disk drives. Mahathir's name is synonymous with this remarkable transition. But those glorious growth rates and thrusting skyscrapers came at a cost. To maintain his grip on power and build the monuments that would win Malaysia global recognition?administrative capital Putrajaya; the Petronas Towers, for a time the world's tallest edifices; the Multimedia Super Corridor, an Asian take on Silicon Valley; and Southeast Asia's first Formula One Grand Prix track?Mahathir undermined less flashy but no less important institutions: Parliament, the civil service, the judiciary, the media.
This darker side of Mahathir's legacy is now showing its face. Festering problems like corruption, cronyism and nepotism have contributed to a drop in foreign direct investment in Malaysia?down 14% last year. With alluring alternatives such as China and Vietnam, Malaysia's steady, English-speaking economy can no longer count on its competitive edge. Equally important, despite long-standing efforts to stitch together Malaysia's ethnic patchwork of majority Malays and minority Chinese and Indians, the three groups appear to be growing apart. Abdullah may have come to office with a reputation as a reformer and consensus-builder, but his three-year tenure has so far offered few solutions to these essential problems.
Yet it is precisely how he handles such fissures in the Malaysian economy and society?as well as the debilitating feud with his predecessor?that will dictate the place Malaysia will hold in the new Asia. "We used to believe we were a model for the rest of Asia, because the other countries were unstable or undemocratic or run by the military," says Tian Chua, information chief for the opposition National Justice Party. "But the rest of Asia has caught up and, in some cases, even surpassed us, so we must start looking at all the things we swept under the carpet for so long."
For a man prone to more vertical ambitions, examining the rot under the carpet can't have been foremost in Mahathir's mind. Born in 1925 in a village in Kedah state as the youngest of nine children, Mahathir earned a partial scholarship to study medicine in Singapore. By 1959, he owned one of the fanciest cars in his hometown, a Pontiac Catalina, and had a Chinese chauffeur. (Most other drivers were Malays at the time.) The cultivation of such emblems of power was to become a hallmark of his leadership.