Archive for the ‘Political economy’ Category

Why the moderately well-off don’t feel that rich

In Economy, Political economy on 19/09/2012 at 5:37 am

The rising inequality of incomes mean that even moderately well-off people do not feel that rich; not least because the elite have driven up property prices in desirable areas … to levels that those not working in the finance sector cannot afford. Meanwhile, the very elite can insulate themselves from everyday life. Think of the experience of the average first, or business, class air passenger. They sit in a different lounge from the other passengers, enter the jetway through a different door, sometimes enter the plane through a different door as well, sit in a curtained-off section and then leave the plane before everyone else. They could make an entire transatlantic flight without coming into contact with the hoi polloi.

The problem is that the political elite tend to mix with the financial elite … and, for security reasons, also have to cut themselves off from the average voter. So it may be doubly hard for them to understand the pressures of those who are actually on median incomes.

Rewriting LKY’s views on FTs? And, if so, why?

In Humour, Political economy on 17/09/2012 at 5:57 am

(Or “LKY has repented? No we got him wrong” or “LKY, no FT lover, no hater of locals”)

I came across this about a month ago, but didn’t comment, waiting to see if anyone other self had picked it up No blogger did, and I forget abt my plans to blog on it until a few days ago.

“If we go on like that, this place will fold up, because there’ll be no original citizens left to form the majority, and we cannot have new citizens, new PRs to settle our social ethos, our social spirit, our social norms …
accept migrants at the rate at which we can assimilate them and make them conform to our values, ” LKY.

I was stunned and shocked to hear him talk of  wanting “original citizens” (who he said need spurring ’cause they are less hard-working than his beloved FTs)  “to form the majority”, and that his beloved FTs (“new citizens, new PRs’) cannot and should not “settle our social ethos, our social spirit, our social norms”.

I had tot he wanted S’pore to be over-run with FTs because he was liked the solution proposed (ironically) in this poem

After the uprising of the 17th of June

The Secretary of the Writers Union

Had leaflets distributed …

Stating that the people

Had thrown away the confidence of the government

And could win it back only

By redoubled efforts. Would it not be easier

In that case for the government

To dissolve the people

And elect another?

(The writer, Bertolt Brecht, was a famous playwright,  a Hollywood screen writer in the golden years of Hollywood in the 1930s) and a Marxist activist.)

What next from him? Malays are loyal to S’pore?

A few days ago, I was reminded of the above remark when I read this from a PAP apologist from the top of our constructive, nation-building ST: seems as far back as 1971, LKY has been concerned abt FTs over-running S’pore. If so how come his acolyte Wong Kan Seng when he was head of Home Team allowed PRC hawkers, a slutty looking, violent, cheating shop assistant, and an ang moh awaiting trial for beating up a S’porean PR status? Or that the government from the late 1990s onwards imported FTs by the cattle truck load.

Well the piece fooled many thinking S’poreans.  S’poreans who saw it as vindication that even a worm like a true blue ST man can turn on a  PAP policy i.e. ST is changing for the better. I had no such tots. I focused on the dates when LKY said:

— “And if you take too many, then instead of our values being superimposed on them, they will bring us down to their values because it’s easier to be untidy, scruffy, dirty, anti-social than to be disciplined, well-behaved and a good citizen.” (1971)

— “There will be cultural, linguistic, social and political problems. /Well, those cultural, linguistic, social and political problems have now come to roost, 40 years on.” (1978).

Err, these were the two examples quoted in 1971 and 1978. Then we have to jump to to August 2012 for the third one which I quoted above. Nothing in between?

A cynic could conclude that there is some rewriting of history, that despite all his praise of FTs and denigrating locals, and the pro FT policies, LKY cared about S’poreans being swarmed by FTs, and that he expressed this in 1971 and 1978.

Possible motives:

— To correct the perception (or is it misperception?) that LKY prefers FTs to S’poreans in S’poreans. The aim is to protect his legacy as one of the founders of modern S’pore. Bit difficult to have an icon of S’pore who prefers FTs to locals, even if he did a lot for S’poreans, which he did, and all but the likes of KennethJ and Dr Chee would agree he did.

— Another could be to show that when he was in charge, he had different views on the role of FTs then Goh Chok Tong or his son.

The spin doctors have to do better. They had better look for statements post 1978 but pre August 2012, expressing the view S’poreans should not be swamped by FTs. LKY was PM until 1990, and S’poreans believe that until recently, he had the final say on any important policy. And then there are all the pro-FT statements. And those denigrating locals.

Whatever it is, join me in a belated birthday greeting to LKY. The team that he headed in the 60s, 70s and 80s, and S’poreans made S’pore a developed world city. Too bad abt the team in the 90s and noughties, of which he was a part. And the son’s doing a decent job of correcting the mistakes of the 90s and noughties (despite being a leading player in the mistakes). But I wish he hadn’t started NatCon.

BTW, I taking up the challenge of compiling a list of things that the WP did not do in response to a challenge from a WP groupie upset with last Fri’s piece. Looking for sponsors to fund it (No peanuts pls). Or for help to draw up the list. Against my principles to do anything for free for the PAP, who always say, “No free lunch”. But who have a freebie via the PA, widely perceived as an arm of the PAP, even if it is tax-payer funded.

NatCon: What Dale Carnegie & dad can teach PM

In Economy, Humour, Political economy, Political governance on 10/09/2012 at 4:46 am

Two quotes from Dale Carnegie’s How to Win Friends and Influence People, that could teach PM, Heng, Sim Ann and other ministers a trick or two:

— “No one likes to feel that he or she is being sold something or told to do a thing. We much prefer to feel that we are buying of our own accord or acting on our own ideas. We like to be consulted about our wishes, our wants, our thoughts.” (Actually Auntie Sun’s hubby, pastor Kong, could teach them this, what with his Sentosa Cove penthse to prove it. But PAPpies prefer to learn from FTs.)

— “The only way on earth to influence other people is to talk about what they want and show them how to get it.”

The second quote explains why PM’s dad (and a hero, flawed, of mine) was successful in getting S’poreans to vote for him and the PAP despite his bullying, thuggish ways.

He spoke to S’poreans of his and older generations what they wanted to hear: “A better life for yrself and yr family.”

And how to achieve it: “Vote for the PAP and accept my policies be they throwing dissidents into prison without trial (anyway they are commies who want to steal yr money or work you to death), and have union leaders like Devan Nair who are my running dogs, and accept my lectures, hectoring, thuggery and bullying.”

He got the message right* and delivered the prosperity bit (whether or not the prosperity was the result of his** policies and methods is open to debate***) for most elderly S’poreans. True, there are some elderly S’poreans who missed the prosperity (and who now need to be helped), but in general, many are reasonably well-off, especially if they suffer from severe illnesses. I’ve relations much older or juz slightly older who have benefited from the then HDB housing policies of the 70s and 80s. And who are benefitting from the present healthcare system.

(One said during the Chinese New Year, “We were poor when we were young. Thank the Lord (her family are Christians) that in our old age we are comfortable. Nothing worse than being poor when old.”)

They are the first to admit it, their children and grandchildren are not finding life that easy. But hey LKY’s only a mortal, even if at times the constructive, nation-building media, esp ST, portrayed him as a demigod.


*And he is a genius when it comes to marketing “Authentic marketing is not the art of selling what you make but knowing what to make.” Philip Kotler, academic (1931–), Marketing Management (1967)

Above and more marketing quotes from

The problem. is that since the late 1980s or early 1990s, the PAP wants S’poreans to do want the PAP wants them to do; but it is unwilling (and unable) to promise S’poreans material prosperity in return. It is only willing to say,”We will try to help you achieve material prosperity. But we still want yr soul.”

The governing PAP used gimmicks, like asset enhancement inflation and indiscriminate importing of , that have backfired on the PAP because of their negative consequences, intended or otherwise, on S’poreans.

**And don’t forget the role that Dr Goh Keng Swee, Lim Kim San, Hon Sui Sen and Ngiam Tong Dow played in the economic policies. They wisely left the bullying, lecturing hectoring and thuggishness to LKY.

***Remember that in the 1960s and 1970s, S’pore was one of the few places (HK was another) that welcomed MNCs to set-up factories. MNCs were looked upon as a form of neo-colonialism by most of the developing world. Today, every developing country wants MNCs to set-up factories. So credit must be given to the PAP for this policy. But as we know, this policy resulted in the lack of home-grown companies like Foxcomm and HTC in Taiwan and Samsung in Korea. But breeding these cos led to problems in these countries.

More tots on the National Conversation

In Economy, Political economy, Political governance on 07/09/2012 at 5:09 am

Shumething I came across on Facebook: To be frank, I think the default is now, “Why should we listen to the government?” and we should all realise that they’re listening more and we’re listening less. Old knee-jerk political reflexes are not useful anymore. We need to be clear-minded and work on both qualitative and quantitative data and input, not just the same old stories on all sides.

He is spot-on.

Then this: “S’poreans [are] urged to share and listen with open minds and  hearts” said Education Minister Heng Swee Keat who “is heartened by the many conversations that are going on about the national conversation and follows them with great interest.” Mr Heng had been tasked by Prime Minister Lee Hsien Loong to lead a team of younger ministers to engage Singaporeans in a national conversation about the country’s future direction.

So how come

— a “CNA producer rescinds invite to bloggers to a forum with Prime Minister because her ‘bosses bosses have decided not to have bloggers on the forum because apparently bloggers have already had a private session with the Prime Minister already”

–” TOC was uninvited to the Singapore National Games”

Now to a suggestion of a topic.

The conversation, to be meaningful, must include the issue of public access to govt data bases. This explains why it should give access: In knowledge discovery in datasets, the major barrier to entry is access to the data. When corporations, governments or other private firms jealously guard their proprietary data, the number of people playing with the data and trying to discover valuable things, or putting that data to good use, will remain small. When data is made public, anyone can put that data to work. In recent years governments have begun making large troves of their data publically accessible. The U.S. government’s open-data project,, for example, has begotten over 200 citizen-developed apps. Similarly, the city of Vancouver, an early mover in the municipal open-data space, opened up their data in 2009, spawning valuable mashups of transit data, the water grid, and common spaces.

It’s gd for a knowledge-based economy.

Netizens who want to take part should take time to read this Written by some of the best economists in S’pore (Jedi Knights all: wonder who is their Yoda? Tommy Koh?), it gives plenty of information to counter the governing PAP’s Hard Truths.

Finally, the calls by some netizens for a debate rather than conversation are misguided. Debates are by their nature rigid. The emphasis is on point scoring. This format suits the government. So better to keep it at the conversational level.

Related post:

PM’s speech: Not juz a change of format

In Political economy, Political governance on 31/08/2012 at 6:32 am

(Or “Why LKY would not have made this speech” or “Two cheers for PM”)

It’s been five days since the speech and the air is thick with analyses and commentaries of what PM said last Sunday. Most of them are noise or smoke or hot air.

While the constructive, nation-building media gushed (like a teen-ager about her puppy love) over the PM’s speech, netizens were not too impressed. Typical reactions:

PM Lee, to no one’s surprise, did not address the root cause of the many issues troubling Singaporeans. The lack of accountability and transparency, civic and political freedoms, freedom of the media, human rights failings, gerrymandering and discriminatory upgrading projects have their roots in repression.

How can there be hope, heart and home when the real issues – foreigner, infrastructure, housing, transport and healthcare – are still outstanding?

Come on netizens: Look on the bright side. He

— Pledged to ensure sufficient affordable housing for citizens, and built more nursing homes for the elderly.

— Said the government will decide on measures to encourage Singaporeans to marry and have more children after consulting the public. Areas being considered include better work- life balance, flexible work arrangements, priority housing for couples with young kids, paternity or shared maternity leave, defraying childhood medical expenses, better pre-school, childcare and infant care, and improving cash benefits for having children known as baby bonuses, he said.

— Pledged Singapore will have two more universities to increase educational opportunities and the government will invest S$60 billion over ten years on the island’s subway system. Bloomberg report.

What this means is that the government is finally going to spend our money on us. No more of his dad’s “frugality”* on spending S’poreans money on S’poreans.

He is saying, “It’s yr money, let’s spend it on making you happier”.

To reinforce the point, he implicitly promised that there would be no near time tax rises, saying (correctly) that Singapore will need to raise taxes in the next two decades (but not now) as the government boosts social spending to support an aging population.

In the past ministers like Tharman and Raymond Lim (remember him?) threatened to raise GST whenever S’poreans asked for more govt spending.

So netizens, give the PM more rope to hang himself or show us that things are a’changing. The assumptions and prejudices of the PAP remain (see here) but at least he is spending our money on things that we want or need to make life more comfortable.

For that let’s give him two cheers. Give him a third if he rethinks the aforesaid prejudices and assumptions inherited from dad.

*An economist lecturing at SMU once commented (when LKY was MM and in rude health) that LKY would die if the government spent a cent more than absolutely necessary on making life more comfortable for S’poreans. Having read his daughter’s comments on his wanting Mrs Lee to change the elastic band on his underwear when she was recovering from her stroke, I think the economist had a valid point, and wasn’t joking.

Kindergartens & the ruling PAP

In Media, Political economy, Political governance on 27/08/2012 at 5:31 am

So the PM in yesterday’s speech promised that the government will play a more active role in pre-school education to help S’poreans “level up”*. Actually it already has a very active role**.

Ever since the Lien Foundation came out with its report earlier this yr which in its media released stated, “Singapore’s preschool education placed 29th amongst 45 countries on the Starting Well Index” and reported that  South Korea (10th) and Hong Kong (19th) were ahead of us,there has been the usual hot air from the government, the constructive, nation-building media, and S’poreans, largely off-line via the media***.

One issue that all three groups skated around are the two elephants in the ice-rink: the PAP Community Foundation (PCF)  which is the dominant provider of kindergartens in S’pore, and its smaller cousin NTUC; and the ring-master (the governing PAP). Remember that the NTUC and PCF are “teeth” to the lips of the governing PAP.

It’s not surprising that the government and its minion, the media, avoided talking abt the role of the PCF and NTUC (until last night) and the government in the failure of kindergarten education here (PM skated over why the system needed fixing). So let me lay it out thickly.

The report says that where S’pore falls short is on quality issues: “Most of Singapore’s weaknesses showed up in the area of‘quality’, which includes factors like ‘student-­‐teacher ratio’,‘average preschool teacher wages’, ‘preschool teacher training’and ‘linkages between preschool and primary school’. All top ten countries on the Index have ratios ranging from one teacher to five to 11 children, compared to Singapore’s 1:20 ratio.”

It’s a question of funding.

While the NTUC and PCF cannot be blamed for the lack of funding because they are, unlike private kindergartens serving the moneyed, trying to serve the masses, not the children of elite, middle class bloggers: they can be blamed for not lobbying the government for more money to rectify ‘student‐teacher ratio’,‘average preschool teacher wages’, and ‘preschool teacher training’.

So until the government increases its funding (which the PM now has), the children of S’pore’s masses will continue suffering from low quality kindergarten education.


*He said: “First of all, we’ll establish a new statutory board to oversee pre-school education. Secondly, we’ll provide and upgrade pre-school teacher training to raise standards. Thirdly, we’ll bring in new anchor operators, in addition to PCF and NTUC.

“And fourthly, we’ll upgrade the anchor operators — the existing ones as well as the new ones — so that they can improve the careers they can offer the teachers.

“They can offer structured development opportunities for the staff, they can introduce creative learning methods for the students but to raise the base — the quality of the mass market.” CNA

**I read with amazement last week the spate of articles in, and letters to our constructive, nation-building media on whether kindergarten education should be “nationalised”.

***Not surprised netizens have been quiet. They don’t breed. Or if they do, they send their kids to gd, expensive kindergartens. They are middle class elitists.

Why Tharman will be the next PM

In Economy, Humour, Political economy, Political governance on 24/08/2012 at 6:21 am

(Or “How S’pore’s PMs are chosen”)

We know that Tharman as finance minister has failed to control inflation (Yes, yes, I know latest number is 4% but remember grain prices are flying), when all he can do is to make jokes about it, and that the government (where he is now the senior most minister in charge of the economy) has consistently failed to raise the productivity of S’pore workers* despite talking the talking on this since I started working in the late 1970s. I’m now a man of leisure and the government is still talking about raising productivity. SIGH.

I was reminded of another failure of the government’s economic policies when the July export data came out last week.  No it wasn’t the failure of the government policy to diversify away from electronics. If S’pore has a comparative edge here, so be it.

No, it was the failure many yrs ago to realise that pill-making is not a steady business. Example: in July, while pharmaceutical shipments were up 1.3% after rocketing 24% in June. It was brought in to smooth the volatility of an economy dependent on the export of electronics, a volatile commodity.

It didn’t work because while selling drugs is a steady business in gd times and bad (unlike electronics), making pills is not. It’s a very volatile business. Drug cos are forever tweaking their supply chains to minimise production costs and inventories. Production is not smooth.

So while pill-making has become an important driver of economic growth, it has not made the economy any less volatile. In fact combining it with the manufacturing and export of electronics causes the economy to gyrate wildly at times.

Guess who introduced pill-making? One Lee Hsien Loong. He was once responsible for raising the productivity of S’porean workers? In the UK, a Chancellor of the Exchequer, who goofed on two major policy decisions, would not get to be PM.

Looks like better not bet against Tharman being PM. With the failures on inflation, productivity and the following on his CV, nap that he will become PM:

— Another failure is the rise in the number for homeless S’poreans at a time of reasonably gd economic growth.

— They are exemplars of the “working poor”, something articulated so well here. Read it.

— Article also explains why Workfare, as it is constructed, doesn’t help the poor. Related posts:

Update after posting: Promotion here is via failure? Presidency of S’pore and Temasek. So the PAP’s meritocracy is achieved via failure, not success? So Orwellian. Reminds me of Beckett’s, “Ever tried. Ever failed. No matter. Try again. Fail again. Fail better.”

Macau: NO FTs as croupiers, dealers

In Casinos, Economy, Political economy, Political governance on 30/06/2012 at 7:01 am

And local poly provides training to work in casinos.

Citizenship has its privileges in Macau (and there is no NS).

Yet casinos are still expanding in Macau despite not having cheap FTs as croupiers and dealers.

Must have lessons for S’pore?

 [I]t’s a world where young people like Tommy hold all the cards. With the law favouring local workers, jobs are handed to the polytechnic’s graduates on a plate. Many receive offers of employment from casinos long before they finish their courses.

When will S’pore become part of the Silicon Valley ecosystem?

In Banks, Political economy on 15/06/2012 at 6:42 am

When SVB Financial Group’s banking unit Silicon Valley Bank opens a branch or office or j/v here, we will know that S’pore has made it into the Silicon Valley ecosystem. It has juz opened its first int’l branch: in London. It will target Britain’s technology, life science, private equity and venture capital sectors

Silicon Valley Bank counts Cisco Systems, Mozilla and Pinterest, among its US clients.

Silicon Valley Bank also has offices in Israel, India and is expected to open a joint venture bank in China with Shanghai Pundong Development Bank.

When it comes to town, bang balls KennethJ, TJS, TRE, TOC, E-Jay, SDP etc.  But don’t worry guys, it’ll be a long time, if ever, before the PAP government’s rhetoric becomes a reality*. In tomorrow’s post, I’ll link to stories which show how competitive Vietnam is becoming in software development to places like India, and that even Cambodia, with an American’s help, can use the internet get into a global biz competing with China and India.

*I mean juz see the BS around the comment made on LSD use, and on sex between adults juz because they are not married. So intolerant.

Government right on need to raise retirement age

In Political economy, Political governance on 13/06/2012 at 5:35 am

The issue of changing the rules on the access to our CPF funds is one that upsets many S’poreans, even those who support the PAP. The imposition of Minimum Sum and CPF Life are lazy solutions to a problem that needs to be addressed: longevity.

But while we should, disagree and row with him on the access to our money, we should not be in denial that we (me excluded) have to retire only in the 60s. The issue is longevity, not the amounts we have in our CPF accounts and how the cost of housing erodes the amounts left over for retirement, or access to our money.

According to a new report from the OECD, increases in the official retirement age are planned or underway in 28 out of its 34 member countries. As can be seen from the chart in the link, pensionable ages have failed to keep pace with longevity

S’pore bashing at its worst

In Economy, Political economy on 05/06/2012 at 7:27 am

Reading this, one ends up asking, “If things are so screwed up here, why isn’t S’pore as poor as Bangladesh, Laos, Cambodia or Burma?”

There are problems: rising inequality, persistent low productivity (despite all the govmin talk and campaigns), lack of local entrepeneurs complacent BSing ministers, and bad public transport. But taz not the same as saying that S’pore is an economic disaster like Bangladesh.

What the fall of Roman empire can teach the PAP

In Economy, Political economy, Political governance on 01/06/2012 at 6:13 am

(Or “Why group feeling is so impt” or “How times have changed since the late 70s (Worth of being a S’porean)”) 

Reading the u/m, I was reminded that Ngiam Tong Dow (Sparta, Athens and the Chinese imperial exam system) and the PAP (George Yeo and his mis-readings of history, one being why Venice did better than Genoa*) have used history to preach to S’poreans

First was the widening gulf between the social classes, rich and poor. When rich and poor start to live completely different lives this leads (then as now) to the poor opting out of the state. All studies today show that society is happier when the gap between rich and poor is reduced …

Widen it and you affect the group ethos of society, and also the ability to get things done through tax.

In the Roman West real wealth lay more in land and property than in finance (though there were banks) – but in the 300s the big land-owning aristocrats who often had fantastic wealth, contributed much less money than they had in the past to defence and government.

That in turn led as it has today to a “credibility gap” between ordinary people and the bureaucrats and rich people at the top.

Other strands in the collapse of the Roman West are more difficult to quantify, but they centre on “group feeling”, the glue that keeps society working together towards common goals. Lose that and you get a kind of nervous breakdown in the social order, which leads to what archaeologists call “systems collapse”.

The growing inequality in S’pore society we know and bitch about, but the loss of “group feeling” is shumething “we see through a glass, darkly”.  We sense it but we have problems articulating this loss of group feeling. Symptoms of it are often ascribed as the problem. Examples: The

— unhappinness that male FTs (like PAP MP Puthu) have a free ride here because they don’t have to do NS;

—  resentment against the PAP government because it appears to elevate FTs to a higher status than locals; 

— resentment against one LKY who called S’poreans “daft”, who needed to be “spurred”,

are symptoms of this loss of group feeling, not the problems themselves.

The government is largely to blame for this loss of group feeling thru its strategy of keeping the economy growing by using FTs to keep wage costs down because otherwise the strong S$ would make S’pore an uncompetitive economy.  Its asset enhancement policy and forcing S’poreans to leverage to their foreheads to buy property, has it made it impossible for S’pore to have low economic growth without triggering serious problems for the PAP and S’poreans. Imagine all HDB owners having -ve equity on their flats?

The sad, funny thing is that the PAP government fostered the sense of collective identity through schemes like NS to strenthen its grip on power after S’pore was ejected from M’sia. Older S’poreans like me can remember the days when the government told us that we S’poreans were special, compared to the Indons and M’sians. Look at the M’sian and Indon Chinese trying to get in. Today, according to the then PM, S’poreans are “daft”, and need “spurring” (or is it to be “spurred”?).

Oh and as the extract showed, “group feeling” is linked to wealth inequality. The bigger the gap, the less “group feeling”.


*Actually, I’m surprised that he didn’t put in down to the Venetians having a more authoritarian form of republic with power centralised in the doge). A rebuttal.

PngGate: Nothing more than a distracting sideshow

In Political economy on 23/05/2012 at 6:37 am

Ah so, so selling one’s soul is pointless. The person who leaked the WP’s minutes of meeting which showed that Png had misrepresented when he said he had removed his name from the ballot must be banging his balls in frustration. Png and WP cocked-up in the handling of DPM’s Teo comments abt Png, but thaz abt all. I doubt this would affect the voters views, even though the constructive, nation-building media (see today’s ST) is bitching about “dishonesty”, being more PAP than DPM Teo.

I have a shrewd guess on who leaked it. His hatred of Low has perverted the character of a decent, fair chap, turning him into a “I hate Low” zombie. I wish him a speedy recovery from his fixation.

On a separate issue, what I found most interesting abt the minutes was that it showed that Eric Tan had decent support for his bid to be NCMP but that GG had more votes. So Eric had supporters on the central executive council who appreciated his hard work and wanted to recognise his efforts. And not all the WP CEC members are cold, rational, calculating machines (Let’s face it, even as Eric’s friend, I think that giving the post to GG was in WP’s long-term interest, and still do despite GG’s “C-” performance in parly), or Low’s acolytes.

Back to Png and WP. WP has “malfunctioned” again, despite, or because of, having three lawyers as MPs. I hope the WP starts repairing and oiling its machine ASAP before something serious happens like getting disqualified in an election (2001). Both in the handling of YawGate and PngGate it made silly, avoidable mistakes. WP needs to get the machine to function as it did in 2006 (Garbra Gomez’s antics notwithstanding: BTW he took responsibility for the 2001 mess-up) and 2011 GEs.


Nice to hear that Eric Tan has confirmed that Png told him before meeting that he didn’t want NCMP post.

Remind yrself, not us PM

In Economy, Political economy, Political governance on 11/05/2012 at 5:10 am

(Or “Is PM on the same channel as S’poreans?”)

“Prime Minister Lee Hsien Loong has said the Hougang by-election should not distract the country from focusing on national priorities and building an inclusive Singapore,” CNA reports.

Either this is the latest of PM’s tasteless jokes in his attempt to outdo Tharman as the cabinet’s and PAP’s mgt committee’s stand-up comic, or it shows us that he doesn’t even bother to glance thru the nation-building constructive local media.

Because if he does, he would realise that “national priorities and building an inclusive Singapore” are at the top of most voters’ concerns: the state of the economy and public transport infrastructure, and of family finances. Examples:

— a MRT system that does not breakdown almost every other day,

— less crowded trains and buses,

— lower inflation (even the crown prince of jokers says the latest inflation number is “a high figure” though he quickly quipped that it didn’t affect most of us “lesser mortals” (my words not his),

— how to earn more money,

— how to afford to own a HDB flat on $2,000 a month,

— how to buy a van (what with escalating COE prices), or

— worrying that ”Our system of integration doesn’t work. Why? Because before we were able to integrate those who were received on our territory, others arrived. Having taken in too many people, we paralysed our system of integration.”

A worrying tot has juz struck me. What if his (and the PAP’s) “national priorities and building an inclusive Singapore” are different from us “lesser mortals”? He wants faster economic growth via becoming a low-cost producer as “national priorities”, while “building an inclusive Singapore” means treating FTs better than locals?

Integrating FTs: It’s our problem now cont’d

In Infrastructure, Political economy, Political governance on 02/05/2012 at 5:50 am

Remember a few days ago I ranted abt the comment by DPM Teo* that, “Singapore needs to pay extra attention to facilitating the new immigrants who are ready to sink roots here, so that they integrate into society more quickly … urged Singaporeans to do their part to make newcomers feel welcome, and to help them imbibe the values that have made Singapore strong as a society”? It was the fault of the governing PAP, so it should fix it, not pass it on to us.

Well this morning, while scanning thru BBC Online, the following comment by France’s president leapt at me,  “Our system of integration doesn’t work. Why? Because before we were able to integrate those who were received on our territory, others arrived. Having taken in too many people, we paralysed our system of integration.”

In view of DPM’s Teo  passing-the-parcel, our problematic MRT system, crowded buses, and expensive public housing one could say that his words describe what has happened here.


*I think he is one of our “betterest” ministers along with Tharman, Khaw and VivianB (so long as you keep him away from the poor and needy and give him engineering tasks). Gan, Chan and Tan seem to be coming along nicely.

Burma: Wake up S’pore

In Emerging markets, Political economy, Political governance, S'pore Inc on 22/04/2012 at 6:39 am

Japan has agreed to write off more than US$3.7bn of debt owed by Burma and to resume development aid.  The leaders of both countries  also agreed to plan a special economic zone near Rangoon.  This could give Japanese firms a head start in winning business in what is seen as one of Asia’s last frontier markets.

Hey could have been S’pore planing a SEZ with Burma! We are “old friends” of Burma. And GLCs and TLCs got experience of building biz parks in Vietnam and China. Come on Georgie Boy. Go broke deals between S’porean cos and Burmese ones and the government. Too comfortable, what with big fat pension? Or planning to reform PAP? Or planning to be president?

(Ya aware that three postings in row abt Northern ASEAN countries. But taz where the biz and investment opportunities are coming from in this region.)

Mandarin Ngiam on “elitism”, “social divide”, education etc

In Political economy, Political governance on 19/04/2012 at 6:58 pm

(or “Analysing Ngiam Tong Dow’s March 2012 speech (Part II)”)

As I wrote in Part I, because Professor Lim Chong Yah’s “shock therapy” proposal is a variation of what was implemented the early 1980s (until the 1985 recession: neutral article on the recession and one blaming it on the original “shock therapy”), when one Ngiam Tong Dow* was Permanent Secretary in the Ministry of Trade and Industry, I thought it would be interesting to reread a speech Ngiam made in March because MTI had once upon a time analysed the problem of severe manpower shortages and the economy’s increasing reliance on lowly paid foreign workers. Its solution was to restructure the economy by raising wages substantially to dampen employers’ demand for lowly paid workers, what Professor Lim is recommending.)

The speech is long and can be broken down into a sociopolitical analysis of S’pore, and an economic analysis of S’pore.

 This post reports and comments on the sociopolitical aspect of his speech**. In Part I, I did the same on the economic part of the speech.


Colonial system

Although this appears in mid-speech, it’s a good introduction to his sociopolitical thoughts.

“When Sir Stamford Raffles founded Singapore in 1819, his town planner demarcated the town into several ethnic enclaves. Kampong Glam (Malays/Arabs), Chinatown (Hokkiens, Cantonese, Teochews), Little India (Tamils), and Tanglin (Europeans). Empress Place on the left bank at the mouth of Singapore River was the administrative and civic centre. The British governor presided from the Istana … Each racial group was free to conduct their own trades, practice their own religions, set up their own schools, and largely married within their own race and ethnic group. The colonial government provided the overarching framework of law and order and schooling in the English medium.

‘Being a British colony, the language of administration was English. Access to English medium schools was open to all races. English became the lingua franca acceptable to all the races as none has any
in-built advantage over the other.”

Differences in the body politic

He talked of the difference between his generation of undergraduates at the then University of Malaya (NUS today) and those of today, “Except for the few activists of the University Socialist Club, my contemporaries at university were politically passive but not naive. In the political environment … we thought it prudent to keep our thoughts to ourselves.”

(So they were not sheep, just cautious, crafty mouse-deer of Malayan folklore?)

But “NUS undergraduates today are more articulate. They have courage of their own convictions,expressing their views vigorously at tutorials or the cafeteria.” (But are they wiser than Ngiam and his contemporaries, or just more noisy? “Remember “Still waters run deep” and “Empty vessels make the most noise”.)

He pointed out that the PM “has to deal with an electorate that is vastly different from … his father’s generation”. “The command politics of his father no longer works … PM has … to appeal to reason”. What surprised me was his comment that Lee Kuan Yew “appealed to emotions”. What I respect abt LKY’s speeches from that era are their simplicity and internal logic.

Uniquely S’porean

“[C]an Singapore be considered a democratic state?”. His answer was it can’t. “We are not a theocratic state like the Vatican or present day Iran. We are … not ideological states like North Korea, Cuba or China.”

He compared the western concept of democracy (“government of the people, by the people, for the people”) with that of the Chinese imperial system, “China’s emperors had to gain the consent of the people to earn the mandate of heaven to rule.” He seems to imply they are somewhat similar.

A difference is that losing heaven’s mandate often involved some form of violence. Mind you, in places like Nigeria, Kenya, the Philippines, Thailand, Bangladesh and India, democracy often involves violence.

He went on to say, “In my view the core purpose of government is to raise the livelihood of the people.” and says, “The PAP won the mandate to govern because it delivered jobs and housing”, pointing out that the PAP has “won every one of the seven general elections since independence in 1965.” Can’t argue with these points.

“There are two competing strands in our body politic.”

“ The first strand is meritocracy. It is modelled on the Chinese imperial scholar system where the best minds compete in nationwide examinations presided over by the emperor himself. The Singapore President Scholar is akin to the Chinese Imperial Scholar.

‘Both systems aim at identifying the best talent to serve the country.” What he missed out is that the Chinese intellectuals and activists (admittedly they usually had some form of Western education often via Christian missionaries) who wanted to reform and modernise the Chinese system in the late 19th and early 20th century criticised the imperial examination system for producing people who were only good in memorising the set examination texts (Classics like the Analects of Confucius). These “modernisers” argued that rule by these scholars under the Manchus led to the decline of China as a military, economic and scientific superpower, repeatedly being bullied and humiliated by the Western powers and Japan. The facts seem to support this analysis.

If the Chinese system was meritocracy at work, give me something else, please. Enlightened nepotism or Plato’s philosopher king, anyone?

Also selection by examinations should not be the only criteria of identifying “the best talent to serve the country”. What abt execution of duties? Or courage or integrity? Or manners? Or even sexual restraint?

“The second strand relates to the system of selecting leaders. It is modelled on Plato’s Republic [where] peers select their own leaders until the philosopher king emerges. As the first among equals, he is accountable to no one but himself. Over time, peer selection breeds a leadership that becomes complacent. Though our state is rooted in meritocracy, we must beware of the dead hand of peer selection. Elitism creeps in imperceptibly.”

He gave an example,“The recommendation by the ministerial salaries review committee to peg ministerial salaries to the median income of the top 1,000 income earners reflects an elitist mindset which is troubling. If the primary purpose of government is to raise the livelihood of the people, a better statistical measure of livelihood would be the median income of all workers, not just the top 1,000 income earners or the MX9 salary scale of the Civil Service.”

He pointed out the WP shares this elitism, “Curiously, both the government and the Workers Party accept that ministerial salaries be pegged to high income earners rather than the median of the work force, which is [US]$3,070 a month as at June 2011.” (WP is close clone of the PAP?)

He said that bonuses for the Cabinet should be pegged to increases in the median income of the work force, rather than the GDP.

Social divide

Much later in the speech, after talking about the economic situation here (covered in Part I), he returned to the theme of the social divide caused by the “widening income gap”.

“In 2012, what will be the threat to social stability? …Future social unrest will arise not from racial or religious differences [He had reminded that even though from its founding 1819 to when Singapore was granted self-government in 1959), S’pore’s races lived lives of passive co-existence, S’poreans witnessed the three racial riots in the 1950s-60s] but from the growing class divide caused by widening income gaps.”

‘The top 1,000 earn million-dollar annual salaries while the rest a monthly median income of US$3,070. The gap is untenable. In the past, equal opportunities in education have provided the social mobility to enable the bright boy from a poor family to make good … The spread of private tuition has changed the [level] educational playingfield.”

He said that during his school days in the 1950s (and mine too in the early 1970s), “only the academically weak students of rich parents take remedial tuition … Today, any parent who can afford the fees will send their children not for remedial but enhancement classes to give their children a head-start”.

This means that, “Though there will still be the exceptional individual who triumphs against all odds, more and more of our state scholars will come from upper, middle income families with professional parents.”

“There is no easy answer to the problem of an uneven playing field in our schools.”

His solution? “The challenge is to level up, not to level down. One suggestion I have is to make classes for academically weaker children smaller. The student-teacher ratio should be more favourable than in brighter classes so that the teacher can give more personal attention to each student, which is what private tuition is all about.”

He acknowledged that the government is doing something about the income gap, “The 2012 budget is politically adroit, replete with spending proposals which basically are income transfers from the taxpayer to the poorly paid, the disadvantaged and the aged.” But there is a hint of criticism, “Income transfers are palliatives, temporary reliefs to abate rising social discontent.”

Fostering entrepreneurs

He said that spending money to expand the then industrial training centres fostered entrepreneurs,

“[O]ur ITC [Industrial Training Centres, the precursor of today’s Institutes of Technical Education] trainees with barely O levels went on to start their own factories producing parts and components for MNCs.” (Bit of an exaggeration this. These entrepreneurs included teachers who were recruited to be managers, then moving on. In the 1960s and 1970s, MNCs recruited teachers because the workers were young and inexperienced, and teachers were experienced supervisors of the young. But the teacher-managers who moved on were often the non-graduates.)

Higher education not compatible with entrepreneurship

“It is hard to find the university graduate who becomes a successful entrepreneur. The prevailing reward system drives our graduates to become bureaucrats/managers both in government and business. White collar jobs pay better than blue collar jobs”


I’ll end with this remark, “[W]hy our concentration on engineering and science-based education is not yielding dividends in productivity and innovation. Instead, the employment share of low-wage, low-skilled personal services is rising. Are we overeducating our children? This is a heretical thought contrary to all my basic EDB instincts. In EDB, our article of faith is that the higher the education level, the more rewarding will our jobs become.”

He tried to answer this issue when he talked of S’pore’s reliance on “low-wage, low-skilled foreign labour to drive economic growth” and why S’pore should be“raising total factor productivity” a priority. I covered these in Part I.


*Ngiam was in the 1980s one of Lee Kuan Yew’s and Goh Keng Swee’s most trusted civil servants and if anyone, could be called a co-driver of S’pore’s drive from third world to first world, it would be he.

**The quotes are taken from a transcription published in BT.

Analysing Ngiam Tong Dow’s March 2012 speech (Part I)

In Economy, Political economy, Political governance on 15/04/2012 at 6:56 pm

Given that Professor Lim Chong Yah’s “shock therapy” proposal is a variation of what was implemented the early 1980s (until the 1985 recession: neutral article on the recession and one blaming it on the original “shock therapy”), when one Ngiam Tong Dow* was Permanent Secretary in the Ministry of Trade and Industry, I thought it would be interesting to reread a speech Ngiam made in March because MTI had once upon a time analysed the problem of severe manpower shortages and the economy’s increasing reliance on lowly paid foreign workers. Its solution was to restructure the economy by raising wages substantially to dampen employers’ demand for lowly paid workers, what Professor Lim is recommending.)  

Rereading Ngiam’s speech, I don’t think he would agree with Dr Lim’s proposal because Ngiam says, “Rising productivity enables workers to be paid more. Inflation sets in only when wages are raised without any increase in productivity.” So productivity comes first, then wages rise as a consequence. Dr Lim would go back to the 1980s plan of raising wages to force up productivity.

(BTW, the government, especially Tharman, keeps “talking the talk” of raising productivity, despite not walking the walk. I’m sceptical of its announced plans to cut the “FTs are betterest” policy until I see how it is being implemented.)

The speech is long and can be divided into an economic analysis of S’pore and a sociopolitical analysis of S’pore,

In this post (Part I), I report and comment on the economic part of the speech**. In Part II (later this week), I will report and comment on the sociopolitical aspects of his speech.


Evolution of the policy of importing cheap foreign labour

“Singaporeans of my generation remember vividly the slums, joblessness, dirt and disease of the 1950s. Through dint of hard work and discipline, we moved rapidly from a labour to a skill-intensive economy. By the early 1970s, we achieved full employment with an unemployment rate of 3 per cent.

‘In the early 1970s when we achieved full employment, some of us in the EDB began to ask the question about the critical size of populations. We did some desktop research and found that there were several industrialised European countries with population size of around 5-6 million. These were Israel, Norway, Sweden and Finland. Our town planners went to work and concluded that Singapore with a land area of 670 square kilometres can comfortably accommodate a population of 5-6 million … we allowed in one million foreigners in the last decade.”

He went on, to give another reason for the FT policy, “As our births fell below replacement levels, we resorted to immigration as an instrument to top up the babies that young Singaporean couples are not having. There are also elements of political re-engineering. Submerged in our immigration policies is the belief that to maintain racial harmony, we need to keep the current population balance constant.”

He challenged the premise that S’pore needs a bigger population pointing out that

– “Singapore is already straining at the seams with a current resident population of five million … The economic assumption is that we can increase our GDP if we can accommodate more people … even doubling our population to 10 million people will not make things better. More likely, a larger population can only make matters worse.”

– “[C]omputer technology has made many manual operations in production obsolete. The key is to produce more with less manpower.”

Knowledge-based economy

“The great challenge … is that we have reached the limits of our skill-based model of growth. Singapore has to move from a skill to a knowledge-based economy. The products and services … are characterised by high technological content. To position ourselves for such an economy, Singapore devotes the greater part of our national budget to education and training.”

“When I was in school in the 1950s, only three out my O level class of 40 went on to university. Today, 30 per cent of a primary school cohort enrol in tertiary education. Raising our average educational level from primary to post-secondary should make a world of difference for our international competitiveness.”

“Our higher education levels and superior infrastructure enable us to compete in knowledge-based industries and services.”


“I observe with some dismay that the manufacturing share of our GDP dropped from a high of 30 per cent in the 1980s to 20 per cent currently.”

“Our total factor productivity should be rising not stagnating. In my view, productivity and real wages of the bottom 20 per cent of our work force have not risen because our labour policies allow employers easy access to low wage foreign labour.”

He explains that for S’pore as a whole, there are costs to this easy access to cheap foreign labour, “If we add the cost of housing, transportation, health and other social services which employers have to provide for their foreign work force, they may be better off training and equipping their Singaporean employees to raise their productivity. Rising productivity enables workers to be paid more. Inflation sets in only when wages are raised without any increase in productivity.”

“Productivity can only be raised when CEOs … take direct charge of the production process. They have to be hands on, not resorting to outsourcing. Productivity should be the key KPI (key performance indicator) for the award of bonuses to CEOs and management.”

“Like any other country in the world, Singapore now competes in a global economy. In such an economy, importing cheap foreign labour is no longer a viable strategy. It is a dead end.”

“We have to grow through raising productivity, not higher headcount. We need to be smart enough to produce more with less. Our higher education levels and superior infrastructure enable us to compete in knowledge-based industries and services. We transformed ourselves in the 1970s from a labour to a skill-intensive economy.”

But he accepted that “raising total factor productivity .. is not easy. A Japanese scholar pointed out … that the optimum rate of productivity increase achieved by [Japan] averaged 4 per cent annually … Japanese are one of the most diligent people in the world.”

Why importing cheap labour is not the solution – it’s a race to the bottom

“Singapore now competes in a global economy. In such an economy, importing cheap foreign labour is no longer a viable strategy.  It is a dead end.”

“In a global economy, you will be competing not only with friends and classmates but with the best and brightest of your generation in India, China, Brazil, Russia and Eastern Europe. University graduates in China and India are willing to work for a tenth of what our young engineers and scientists expect. If we fail to raise our total factor productivity, Singapore would just be an also-ran in the race to be a knowledge-based economy. The window to raise total factor productivity through application of knowledge and training is fast closing with the opening up of India, China and Indonesia. Singapore has lost two decades relying on low-wage, low-skilled foreign labour to drive economic growth.”

What can help

– “Our managers and administrators are among the best paid in the world. They will have to get off their high horse and personally lead the drive for higher productivity. Outsourcing is a bad word in my vocabulary. Companies and government ministries should figure out how to train their staff and redesign jobs and processes to achieve more with less.”

– “[I]nterest free loans should be given to enterprises with clear roadmaps to re-equip and raise the productivity of their workers.

What he is against

“Grants should not be given to management (consultants) to do a job they are already paid to do.”

‘I am against job credits in any form because they are simply wage subsidies which do not raise productivity in any way. My personal observation is that job credits simply add to the bottom line for payment of bonuses to management who do not have to lift a finger to raise the productivity of their enterprises.” Based on this, I suspect he would also be against having a minimum-wage.

“The 2012 budget is politically adroit, replete with spending proposals which basically are income transfers from the taxpayer to the poorly paid, the disadvantaged and the aged. Income transfers are palliatives, temporary reliefs to abate rising social discontent. They do not help to raise productivity.”

Final warning

“We failed to bite the bullet in the 1980s to restructure our economy. There may be no second chance the next time around.”


*Ngiam was in the 1980s one of Lee Kuan Yew’s and Goh Keng Swee’s most trusted civil servants and if anyone, could be called a co-driver of S’pore’s drive from third world to first world, it would be he.

**The quotes are taken from a transcription published in BT.

S’pore is tops, but MSM does not report it

In Economy, Political economy on 09/04/2012 at 6:06 pm

Analysts Maplecroft rates five countries at the “extreme” level of risk for the pandemic spread of influenza, with Singapore top, followed by the UK, South Korea, the Netherlands and Germany.

Singapore is rated the highest for the speed at which influenza could spread, because of its dense population (all those FTs?) and its status as a global travel hub.

BBC article.

Behind the $83 a month HDB flat

In Financial competency, Political economy, Political governance, Property on 12/03/2012 at 4:37 am

(Or “Mixed thoughts about the poor having to take out a HDB mortgage” or “What the HELL? PAP misses the plot!”)

In, I suppose, an attempt to show that ministers were not talking rubbish about someone earning less than a $1000 being able to afford a HDB flat (thanks be to a government subsidy, and forced savings via the CPF system), the constructive, nation-building ST had an article on how Mohammad Charlie Jasni who is earning $850 a month is able to afford a two-room HDB flat.

The analytical, compassionate, risk-adverse part of me agreed

– With the view articulated by TOC’s Uncle Leong that it would be better if Mohammad was allowed to lease, and not have pay a mortgage ($44 versus $83 a month)

  — It’s cheaper.

  — There is a possibility of him defaulting and losing all that he and his his wife have put in ($40,000 in CPF savings), “the probability of job loss, pay cut, sickness or accident, may be relatively higher than others … the likelihood of him defaulting on his mortgage over the next 30 years may be high”.

  — He and his wife would have some savings for the couple’s old age. He is only able to pay only $83 a month because his and his wif’e’s CPF savings of $40,000 have been used up, reducing the amount owed to slightly more than $20,000.

– And with this comment on this TOC article thread, “I find it very CHILDISH for the government to glamorise a policy that enables a low income earner to own a HDB flat, and yet ignoring the fact that the same low income earner will face the bigger problems of making ends meet on the daily basic necessities like food and transport.

‘These low income earns may own a HDB flat but cannot survive paying the basic expenses in our daily life, and then end up dying of hunger… good policy meh? …”

On the other hand, the analytical, risk-taking side of me thinks that here is a couple who because of the CPF grant and forced savings have been given the chance to better themselves.

The couple can sell off the property after five years and make a good profit (at least $100,000) on the flat, even assuming a slightly weaker market. They can move to Johor, rent a place there, and he can commute. Alternatively in five years time, assuming he is allowed to rent the place out, he can use the rent money to rent a place in Johor, and commute. He could even go into business, while living in Johor.

The couple has options that leasing does not give them, albeit at greater risk. Many of the comments I read on this issue on the internet portray people like Mr Mohammad Charlie Jasni as passive and helpless. The one good thing the ST article shows is that this is not true. They are just as keen to better themselves as better-off, more fortunate S’poreans. In its Alice-in-wonderland way, the government is trying to help them out of a surreal place that is largely the creation of the government.

The issue is why is public housing so expensive: a two-room flat costs $99,200?, Note after $40,000 grant, the HDB loan is $59,220. On a 30-year mortgage at the HDB Concessionary Loan rate of 2.6%, the monthly repayment is $237. Mohammad is only able to pay $83 a month because the mortgage was reduced to slightly more than $20,000 because he and his wife have used up their CPF monies of $40,000. If they default …

But let’s celebrate Mr and Mrs Mohammad Charlie Jasni. They give the lie to the Hard Truth that only immigrants work harder and aspire to have a better life. They also give the lie to the casual assumption of many do-gooders that the poor are passive and helpless.

A reason not to help SMEs

In Economy, Political economy on 09/03/2012 at 7:43 am

Well when PAP and WP MPs. SDP activits and Tan Jee Say are worried about the fate of SMEs,all saying shumthing must be done to help the SMEs, then something must be done to help them?

Maybe not: Where small firms are most common, as around Europe’s southern periphery, their prevalence is sign of uncompetitive markets and low productivity … examines the problem of the stunted European business

Ah, what about the German SMEs? Well the Germans are different. They stated two world wars in the 20th century, lost both of them but 67 years after failing to create a Third Reich is now the dominant European power; restructured their economy when Eurozone interest rates were too high for Germany (they cut real wages and welfare payments, and raised productivity, unlike the lazy, lying, thieving Greeks who only know to riot, lie and steal); and sell to China the machinery to make goods that China exports.

S’poreans are not Germans. For starters, the German government, like the Germans, doesn’t believe in FTs to solve Germany’s vanishing workforce problem: 20% over the coming decades. The Germans believe in robots and moving manufacturing to eastern Europe (their M’sias and Indonesias).

Also unlike our SMEs, the most succesful German SMEs are global leaders in their very specialised fields. Finally most of our SMEs would not fit the German definition of SMEs. Ours would be classified as micro enterprises

Not quite correct, Tharman

In Financial competency, Financial planning, Political economy, Political governance on 06/03/2012 at 6:32 am

(Or “Wrong, Minister”) (Updated at 9.20 am to explain the “premium”)

“The bequest goes to your loved ones, not to other CPF members and not to the Government. You get all of your capital back either through your monthly payouts or in a bequest that you leave to your family and loved ones.”

Err you don’t. What about the “premium”* that one pays to ensure that one is covered for life? This is “lost” if one dies too early to benefit fully from the annuity. The “premium” amounts to 10% of the amount in the Retirement Account (at age 55) for the Basic Plan and 30% for the old Balanced Plan. Both are not “peanuts”.

BTW1, I was not one of those who criticised or raised an eyebrow at Tharman’s remark that one could earn only $1,000 a month and still buy a HDB flat.

BTW2, I know that Tin Pei Ling is not helping to create sound-bites for Tharman, juz as she isn’t helping Vikram Nair with his jokes, Hri Kumar Nair with his research and MoE with gathering data on FT government scholars. She is focusing on helping the uncles and aunties in her self-styled SMC. By all accounts, she is doing a good job.


*”Premium” is the amount that a CPF holder has to pay from his minimum sum in order to get life-long “assurance” of an annuity till death.I put the word “assurance” within quotation marks because technically if the CPF Plan that one is in goes bust, one’s annuity payments ceases. Taz the law.

“Subsidy” is NOT a four letter word

In Financial competency, Political economy, Political governance on 06/03/2012 at 5:33 am

Many bloggers are upset that the govmin is giving S$1.1bn to SMRT and ComfortDelgro to help improve bus services. Seems to them, “subsidy” is a dirty word. Hmm, didn’t they get the idea that subsidies are always bad from the PAP idea, particularly one LKY?

But maybe, the PAP has changed its mind that the word “subsidy” is a dirty word. Reminds me of what Keynes is supposed to have said In response to an accusation of inconsistency: Keynes is often reported to have said “When the facts change, I change my mind — what do you do, sir?”. More to the point, he is reputed to have said: “When circumstances change I change my mind. What do you do?”

Well the facts and circumstances have changed. The PAP’s share of the popular vote is only 60% and its perceived presedential candudate won by just 7000 votes or less than 1%.

I’m not complaining that the PAP is being pragmatic by addressing the hot issue of overcrowded public transport: I take the bus. I’m not one of those who don’t take the bus regularly, has one car per family member, doesn’t pay income tax, and bitches abt this subsidy.

BTW, I don’t own shares in either company, nor in SBS Transit. I never bot as I tot dividends might not be sustainable. Juz look at the share prices in recent years. The yield remains highish because share prices have collapsed i.e. dividend payments have fallen.

But now the 2011 dividend payments for ComfortDelgro and SBS Transist look sustainable.

Anyway, here’s an example of a subsidy. I own shares in HSBC which I’m glad took advantage of the European crisis to get a subsidy from the European Central Bank. Let the BBC’s Robert Preston tell the story,

“HSBC, widely perceived to be the strongest of the UK’s banks and one of the strongest in the world, borrowed €5.6bn from the ECB … The reason it may be controversial that British banks have borrowed so much from the ECB – a bit less than 4% of all the money on offer – is that the interest rate is so low, just 1%. So arguably eurozone taxpayers are subsidising UK financial institutions.

Global & ASEAN perspective on S’pore’s vanishing workforce

In Economy, Political economy on 04/03/2012 at 6:39 am
“Singapore labour force to start shrinking: DPM Teo” was the healine in Friday’s Today. The next decade will see the Singaporean workforce start shrinking, while more go into retirement, such that come 2030, there will be only six citizens starting their working lives for every 10 going into retirement. And beyond that, the Republic’s population will start to “decline sharply”. Article
The chart here shows that the following nations are all set to see declines of more than 10% in the expected change in working age population between 2010 and 2035. ; Switzerland, the Netherlands, Austria, Hungary, Italy, Portugal, Poland, South Korea, Russia, Japan and Germany. In the last two cases, the decline is set to be 20%. Despite the comments of one LKY, the Japanese are happy and properous, happily ignoring his advice on demographics.

Well I don’t see waz wrong being in the company of  Switzerland, the Netherlands, Austria, South Korea, Japan and Germany. S’pore’s decline is much less than 10%, and it has the company of HK, Thailand, Denmark, Finland and China.

But maybe the government is worried about Indonesia, Malaysia and the Philippines? Don’t want them to be more successful than S’pore?

Whatever it is, maybe it’s about a variation of the theme behind this poem by Bertold Brecht, a famous playwright and Marxist activist (he was even a Hollywood screenwriter in the golden years of Hollywood in the 1930s):

After the uprising of the 17th of June

The Secretary of the Writers Union

Had leaflets distributed …

Stating that the people

Had thrown away the confidence of the government

And could win it back only

By redoubled efforts. Would it not be easier

In that case for the government

To dissolve the people

And elect another?

Managing people, the S’pore way cont’d

In Footie, Political economy on 02/03/2012 at 7:08 am

In January 2011, after the footie authorities disbanded the national team after a dismal showing in the 2010 Suzuki Cup, but kept the manager, and promised the start of a rejuvenation process, I wrote “Managing people, the S’pore way”.

Well under the same manager, but with different players, the Lions have lost all six games in the third round of the FIFA World Cup qualifiers.

So I republish what I wrote then. Let’s hope this time the footie authorities stop their Serbian tua kee and FT loving ways. Pigs would fly first methinks.


Managing people, the S’pore way

In the English, Italian, German and Spanish footie leagues, if a team does badly,  the manager gets the sack. The view is that the manager is responsible for managing the players to get them to perform at thier best.

In S’pore, the manager retains his job, the players get the sack, even if the manager has been around for almost a decade.

In Western democracies, the ruling party gets replaced if voters are unhappy.

In S’pore, the ruling party creates GRCS, then super-GRCs, all the time telling the voters they are daft and lazy. And, juz to make sure, imports voters. Reminds me of what Bertold Brecht, a famous playwright and Marxist activist wrote:

After the uprising of the 17th of June

The Secretary of the Writers Union

Had leaflets distributed …

Stating that the people

Had thrown away the confidence of the government

And could win it back only

By redoubled efforts. Would it not be easier

In that case for the government

To dissolve the people

And elect another?

He was writing about the East German government after its soldiers had shot some protesters.

At least here, the unhappy voters are not shot, juz ignored, and threatened with a military coup if there is a” freak election result”.

Uniquely S’porean, this method of managing people.

Budget: A Plague on Both Your Houses

In Political economy, Political governance on 27/02/2012 at 4:22 am

(Or “Budget: Missing the point”)

I think the government has “got it”, more or less, in the overall thrust of the Budget. More below. But I’m annoyed (and sad) that it still hasn’t “got it” when it comes to helping the poor. I like the theory behind the GST Voucher for the poor (it helps make the tax on consumption less regressive). But like Workfare (which I support in theory), it is flawed because the poor need money both now and in the future, but both Workfare and the GST Voucher focus on the future.  I’ll leave it to TOC’s Leong Sze Hian to describe the problem.

“A new GST voucher will be given to help particularly lower-income and elderly Singaporeans, comprising three components – cash, Medisave top-up and U-Save.

‘So, you pay for your GST increase in cash, but you get the bulk of it back not in cash, but as Medisave top-ups which you can only use for medical purposes, and U-Save which helps you to pay for what has historically been generally increasing utility bills.”

A wicked, mean tot. Could one of the reasons for putting the money into CPF accounts rather than pay cash be to lessen the cost to the government? The real value of the cash in the CPF accounts are steadily and steathily eroded by inflation. With the Medisave account paying 4%, and the ordinary account 2.5%, and inflation at juz below 5%, could the government be hoping that inflation reduces its headline cost by the time the money is withdrawn? Even if inflation returns to the 2% range, the real cost to the government is reduced. As I said, a wicked, mean tot that would never occur to a PAP supporter or a journalist in our constructive, nation-building local media.

But I have to reseve some irritation for the refusal of usually rational bloggers to recognise as a Bloomberg report puts it, “Singapore Shifts Priority From Growth to Curb Income Inequality” . At best, they say very grudgingly, “OK BUT …” 

Following the removal of deadwood from the cabinet, and the building of more public apartments despite a forecasted economic slowdown, the government has moved to address, by way of more than words, four other “toxic” issues that make S’poreans angry: the sheer volume of FTs flooding the streets, the use of FTs to keep wages from rising, congested public transport and growing income disparity.

Now whether the measures announced in the Budget are sufficient to reverse the problems that these four issues have caused, I don’t know. I suspect not, and more has to be done. Nor can anyone be sure that this isn’t all Wayang.

But a step has been taken. Whether the step is small or big, only time will tell. Whether more steps will be taken, again only time will tell. But a step has been taken, and this should be acknowledged by those of us who are not aligned with any of the opposition parties, whose reason or justification for existence, is rightly, to oppose the government. 

Those of us who who are not aligned with any of the opposition parties should not be professional critics of the government. Which reminds me, I found Lucky Tan’s “Threats of Defamation Lawsuits : Not a way to win over netizens….” amusing because maybe the PAP thinks that trying to make friends on the internet is a waste of time given its failure to make the internet a more PAP friendly place. If so, the likes of Zaqy and Baey could find their cushy S$15,000 monthy stipends history at the next general election.

And if it’s all Wayang, we will soon know, “You can fool all the people some of the time, and some of the people all the time, but you cannot fool all the people all the time.” And come the next general election, the PAP will pay a heavy price.

The Germans tot China could be the next growth market in 1975

In Political economy, Political governance on 17/02/2012 at 5:05 am

The German way:

— Long term thinking; and

do not have ‘return on capital employed’ as their most important goal. Contribution to society is always a very important point.” This should be a lesson to the government, Temasek and its TLCs, and other GLCs who are obssesd with two variants of “return on capital” : “returns on investment or equity.

Did the S’pore government which claims that “too much democracy” (I’m summarising it’s view) is not conducive to decision-making for the long-term, see China as the next growth market in 1975? I doubt it. S.poreans had difficulty getting permission from the S’pore government to visit China.

In October 1975 – 37 years ago, when China was in the chaos of the Cultural Revolution – the Financial Times described German policy towards the country: “China could be the next growth market”.

Talk about long-term thinking. In ultra-unlikely circumstances – where Chairman Mao was excoriating capitalism and the new Chinese constitution talked of a “dictatorship of the proletariat” – German capitalists had identified the big new market: the People’s Republic of China.

“The West German approach is typical of the very long-range view that German industry has taken,” said the FT.

“At the heart of the approach lies the cultivation of a market, even if the short-term results are not over-encouraging.”

Or take this from Die Zeit in the same year: “The image which Germany is trying to project in the largest and most populous developing country in the world is not that of a major political power, but rather of the most important industrial country in the world, a country whose tool-making and mechanical engineering can compete successfully on the world market.”

And this should be a lesson to the govwernment, Temasek and its TLCs, and other GLCs, do not have ‘return on capital employed’ as their most important goal. Contribution to society is always a very important point.”

Do Reits have unintended commercial consequences for SMEs?

In Political economy, Property, Reits on 16/02/2012 at 6:45 am

I invest in Reits for the yields and the brokers and local media have discovered Reits as a great defensive play. But SMEs claim that Reits have caused their rentals to escalate unreasonably.  JTC has been asked to review its current policy of divesting industrial space to private entities (like its Ascendas).

Business Times – 02 Feb 2012

SMEs blame Reits for growing rental pains

JTC asked to review its current policy of divesting industrial space to private entities


(SINGAPORE) Rising rentals for commercial and industrial space have emerged as a pressing issue for small and medium enterprises (SMEs), and the fingers are pointed squarely at the dominance of real estate investment trusts or Reits as landlords.

The Reits’ drive to enhance yields and returns for unit holders – which usually translates into rental hikes – have left many SME owners, who feel they have limited alternatives here, fuming.

It has also led to calls – including a recommendation by the newly formed SME Committee – for JTC Corp to review its current policy of divesting industrial space to private entities like Reits and return to its previous role of an industrial landlord, so that it can provide ready and affordable industrial space to SMEs.

‘Rentals and capital values of properties are going up, impacting business costs for SME owners and eating into their bottomline,’ said Lawrence Leow, chairman of the SME Committee.

Read the rest of this entry »

S’pore: 9th most expensive city in the world

In Economy, Political economy on 15/02/2012 at 6:02 am

(Update at 9.00am on 15 Frbruary 2011: Headline rewritten, and changes made in text. “kbs” pointed out (see comments) that I misread the 2001 figures. Apologies for being daft. Will try not to be daft again.)

In 2001, it was ranked 97th. The survey uses prices of goods and services such as food, transportation, housing, utilities, private schools and domestic help to calculate scores for each city, using New York as its base with a score of 100. To be fair, most S’poreans do not rent homes in prime districts or send their children to private schools.

And the strength of S$ in 2011 can distort figures. A kilo of bread would have cost US$2.86 in 2010, according to the Economist’s data, but last year cost US$3.19 – an 11% increase. But, 6% of this is due to weakening US$. In S$, the price of bread would have gone up 5%.

Still 88 places in 10 years being number 9 is not shumething to crow about because

If we look at the data for the last 10 years, for example, the income of Singapore citizens at the 20th percentile level, grew by only 25%, from $1,200 in 2001 to $1,500 in 2011 (excluding employer CPF contributions).

In real terms, I estimate the annualized growth to be about 0.2%.

This is a far cry from the 2.2% real annualized growth for the last five years (including employer CPF contributions).

(Full article)

And the “new poor” continue to face the triple whammy of high living costs, low wages & purchasing power.

The “new poor” revisited

In Political economy, Political governance on 08/02/2012 at 6:05 am

“Tan Jee Say, an opposition politician, said such global accolades [“the top marks S’pore scores in global surveys on the ease of doing business and low corruption levels”] often had little bearing on the lives of Singaporeans, many of whom who have seen their incomes stagnate over the past decade” (article), reminded me of what the Sage (not Stag) of Hougang said in 1997 or 1998 during the Asian financial crisis.

Low Thia Khiang (then the sole WP MP) spoke of the “new poor” and was roundly condemned and attacked by PAP ministers and MPs, and the local media for using of this term.

Well he was right wasn’t he? “The new poor” S’porean is a growing species. Leong Sze Hian pointed out a few days ago that wages have stagnated for many S’poreans for the last ten years:

10 Years – hardly any increase?

If we look at the data for the last 10 years, for example, the income of Singapore citizens at the 20th percentile level, grew by only 25%, from $1,200 in 2001 to $1,500 in 2011 (excluding employer CPF contributions).

In real terms, I estimate the annualized growth to be about 0.2%.

This is a far cry from the 2.2% real annualized growth for the last five years (including employer CPF contributions).

(Full article)

And the “new poor” continue to face the triple whammy of high living costs, low wages & purchasing power.

And didn’t Low have foresight when he asked in the late 90s for help for the “new poor? Something that was again rubbished by government ministers, PAP MPs and the local media, but which is now the part of the PAP’s strategy for regaining lost ground in the next general election: Bread and perhaps Circuses. The government is even planning to strengthen the almost non-existent social safety net, something which was taboo in the past.

So while S’poreans are rightly upset with the silence of the WP (Low is the leader) and MP Yaw (a married man) over whether Yaw had an affair with another married WP member, let’s not go overboard in flaming the WP, even though Yaw’s demotion (OK resigning as Treasurer and leaving the party’s politburo) tells us everything.

Cut it some slack because Low got the issue of the “new poor” spot on all those many years ago, and because he (and Chiam) kept the flame of opposition alive in parliament and on the ground, when it was most unfashionable to be associated with the Opposition.  Example: one TJS was quietly working away in fund management. Remember too, Low has played a big part (he became the party leader in 2001?) in the WP becoming the force it has become. And finally, he did nuture two next generation leaders Yee Jann Jong and Gerald Giam.

So while I think the WP is damaging itself by being more PAP than the PAP itself by refusing to comment on “rumours” about Yaw, let’s hope the damage done is not too great.

In case if anyone is wondering, the WP did not pay me for this “ad”.

A final mean, very mean, unrelated tot: “Is TJS speaking from experience when he talks of ‘incomes stagnate’?”. Declaration of interest: My income has collapsed in the last decade. And even then it was a fraction of what I was earning in the mid 90s. I was, and am, part of the “new poor”. But no need to cry for me. Being poor is relative as Grace Fu and friends should realise.

And anyway:

Let what will be, be.

Tis labor lost thus to all doors to crawl,
Take thy good fortune, and thy bad withal;
Know for a surety each must play his game,
As from heaven’s dice-box fate’s dice chance to fall.

Rolls-Royce’s S’pore workers more productive than UK workers

In Economy, Political economy on 05/02/2012 at 5:21 am

Bang balls, SDP, NSP, KennethJ and TJS. Hey not all the govmin’s initiatives fail. Witness this new aero engine plant.  And S’pore-based workers can be more productive than British ones: by six days.

What the report does not tell us is that SIA’s (along with Qantas’ ) Airbus 380s use RR engines. RR only has a 9% share of the Western-made aircraft engine market share.  This again shows that there are benefits to Singapore in SIA being owned by the state. Bang yr balls harder SDP, NSP, KennethJ and TJS.

Fairness: What is it?

In Political economy, Political governance on 03/02/2012 at 1:40 pm

When one Tan Kin Lian was attempting a political career (while pretending not to do so) and, later, a presidential bid, the one thing that irritated me no end was his constant call for “fairness”. And when asked to define it, he said it is common sense.

I wish this had been written then so that I could post it, to get my blood pressure down.


fairness is, as Scott Adams, the creator of Dilbert, puts it, “a concept invented so dumb people could participate in arguments”.

To get a “fair shot” is to be offered the opportunity to participate fully and succeed within the country’s institutions … Conservatives who strenuously object to the idea that the American system should aim at “equality of outcomes” will sometimes affirm “equality of opportunity” as an alternative. But this is a mistake. To really equalise opportunity requires precisely the sort of intolerably constant, comprehensive, invasive redistribution conservatives rightly believe to be required for the equalisation of outcomes. If one is prepared to accept substantial inequalities in outcome, it follows that one is also prepared to accept substantial inequalities in opportunity.

Getting a fair shot doesn’t require equalising opportunity so much as ensuring that everyone has a good enough chance in life. The content of “good enough” is of course open to debate, but most Americans seem to agree that access to a good education is the greater part of a “good enough” and thus fair shot. Naturally, there is strong partisan disagreement over the kinds of education reform that will do right by young Americans. And there is also disagreement over elements of a “fair shot” beyond education. For example, many liberals believe workers don’t have a fair shot at achieving a decent level of economic security without robust collective-bargaining rights. And many conservatives believe that an overly-strong labour movement invites outsourcing by raising domestic costs, and thereby deprives American workers of a fair shot at employment. There may be some fact of the matter about which policies are most likely to benefit students or workers. But if one is more fair then the other, how would we know?

What is it to do one’s “fair share”? In small groups, it’s clear enough. If my friend and I are shoveling the front walk, my fair share of shoveling, and his, is about half. Often we adjust for differences in ability. If I am big and strong and my friend is small and frail, his fair share may be as much as he can manage. That won’t mean that the whole remainder is my fair share, though. If we’re going to get the walk shoveled, I may have to do a bit more than my fair share. These things get complicated quickly. That’s why the question of what it means for an American do his or her fair share, qua citizen, is completely baffling.

Are you doing your fair share? How would one know? Actually, I just made myself feel slightly guilty for not going to med school and joining Médecins Sans Frontières. But unless government can come up with a way of taxing the leisure of people who aren’t doing as much as they might for kith and country, I reckon I’ll just stick to part-time pro blogging and let all you 9-to-5 suckers finance the necessary road-building and foreigner-bombing.

tempts me to agree with Mr Adams when he argues that fairness is “purely subjective”. But I’ll resist the temptation. I don’t think judgments of fairness are entirely whimsical. It really is unfair to eat more than your share of the cake, or to do less than your share of the shoveling, or to get ahead by flouting reasonable rules to which others faithfully adhere.

Not so easy, is it TKL?

S’pore Property: But would banks be allowed to?

In Banks, Economy, Political economy, Political governance, Property on 27/01/2012 at 11:42 am

Mortgage rates make the difference

So what contributed to the recent decoupling of Singapore and Hong Kong home prices?

The simple answer is mortgage rates.

Driven by strong loan growth and rising loan-to-deposit ratios, Hong Kong banks have raised their mortgage rate spreads since early this year [2011]. This has resulted in higher mortgage rates and reduced demand for residential properties, which in turn led to the slide in private home prices since September.

On the other hand, the Government’s property cooling efforts have so far been thwarted by very low mortgage rates. With base interest rates remaining near record lows and Singapore banks charging very low mortgage spreads, affordability remains high.

However, there is a risk that Singapore mortgage rates would rise next year from their current low levels. Like their Hong Kong peers, Singapore banks have also experienced strong loan growth over the past year, which in turn has pushed up their loan-to-deposit ratios – although it must be said that ratios in Singapore dollars are generally still low.

Moreover, with the debt crisis that is plaguing the European Union, there has been anecdotal evidence that some European banks are pulling back their credit lines in Singapore to help boost capital ratios as required by the EU debt plan. If these banks continue to deleverage, it could result in less competition in the lending market for Singapore banks, which may then feel comfortable enough to raise their lending spreads, including mortgage spreads.

In fact, during the 2008/2009 global financial crisis, local banks such as UOB and OCBC were able to increase their net interest margins as foreign banks reduced their lending activities in Singapore.

Thus, while the recent decoupling in Singapore and Hong Kong residential property prices may make for an interesting read, we do not expect it to last for long, especially with the latest round of cooling measures introduced in Singapore.

Should happen as this UBS analyst postulated in late Dec 2011. But if the government thinks property prices will tank, not juz fall a little, the local banks will “do the right thing” by home owners, but not investors. It has happened before. In the crisis in the mid 80s, when many home owners had negative equity, the banks “did the right thing” and did not ask for more equity. Home owners had gd reason to vote PAP.  



The Dark Side is preparing for 2016 GE

In Political economy, Political governance on 27/01/2012 at 5:33 am

(Or “Why the PAP could turn the tables in the next GE: if the Opposition remains complacent)

Although what the PAP is doing is observable to the Opposition parties and their fellow travellers on the Internet, they seem blind or indifferent to the PAP’s actions, or both, because of their assumptions and prejudices. Worse, the major Opposition parties are complacent, what with the problems at WP, NSP and SPP (More of this on Monday in a CNY Special — gossip I heard while feasting and gambling).

Two Sundays ago, (as part of his ang pow strategy?) PM promised that, despite the economy slowing down, the government would improve the education and public transport systems, and build more homes so that young couples can start their families. These remarks were made at a Lunar New Year event  in his Teck Ghee constituency, part of the Ang Mo Kio GRC. He also officiated at the re-opening of a wet market and food centre where he said more of such markets will be built over the next few years, with the aim of keeping food prices affordable. Not long ago, such markets were being to a commercial company which promptly increased rentals. He said nothing then. And the HDB and Comrade Mah gave grumblers the finger.

Then last Saturday in his CNY message he said Having children is ultimately a personal decision for families to make, but Government will do its part to reduce the anxieties and burdens of parenthood. Baby Bonuses already help families with the costs of raising children. We are also doing more to help parents balance work and parent­hood, including extending maternity and childcare leave, and encouraging companies to offer flexible working arrangements for employees with children. We are committed to helping young couples obtain their first HDB flat as soon as possible. With government support, childcare has become more affordable, and childcare centres are expanding and providing many more places than before. The critical factor now is not more financial incentives, but creating the supportive social climate and attitudes that will encourage couples to have more children.

This presses so many “hot” buttons: freedom to choose to have babies, social environment, financial help in raising children and affordable housing for the young.

What with the building of more public  flats (despite the slowndown, and possible recession, Comrade Mah must be rolling his eyes in disbelief) and now taking a serious attitude towards other issues that upset voters (transport, education and the rising cost of living and the cost of raising a family, social and monetary, it looks like the government and the PAP have learnt the lesson that “It’s the voters, stupid”.

In the past, we would be told to tighten our belts to survive the slowdown. But given the still high levels, by global standards, of ministerial pay, and Grace Fu’s bitching about her pay cut, it would not be politic to tell S’poreans to lower their expectations. Better to follow the Roman emperors who made sure the populace of Rome had plenty of bread and circuses (gladitorial games). And S’pore has the money, despite what the SDP and Goh Meng Seng say. Even SDP’s most famous ex-member says so. To TJS, S$60bn from the reserves is “small change”. So does Citi, an investment bank**.

Even as late as November, I wasn’t too sure if the PAP and government had learnt the lessom of the May and August elections. In November, newbie PAP acting junior minister (and ex army brigader) was leading raids on foreign workers quarters. Judging from his remarks on Facebook, I assumed he wanted to see if the quarters were fit for human habitation, not whether there were illegal FT workers.

I was thinking to myself, he had better focus on the latter, given that the PAP is perceived by many true blue S’poreans as the “Pro Alien Party” and that the PAP should learn from the HK experience.

The once popular pro-democracy Civic Party suffered a series of defeats in neighborhood council elections in October last year in HK, as pro-Beijing politicians successfully tapped anti-immigrant sentiment as well as public hostility toward environmental measures perceived as harming employment and increasing the government’s construction costs.

The Civic Party had been gaining ground in previous elections, but ran into trouble this year as lawyers who are prominent in the party took on social and environmental causes that were unpopular among many Hong Kong residents. The most divisive issue has been whether more than 200,000 household workers, mostly from the Philippines and Indonesia, can eventually become eligible for citizenship.

The government and governing PAP is focusing on issues that affect the lives of ordinary S’poreans, shumething the Opposition parties especially the SDP have done for a long time. I hope bleeding heart liberals (especially those writing on or reading blogs like TOC) understand why. There are no votes (and eyeballs) to be won in helping foreigners, convicted criminals and dolphins.

Charity begins at home. Or to put it more nicely, “Conserve compassion: S’poreans come first, second and last”.

Build more homes, improve education and public transport, and keep the cost-of-living from rising too fast; and we shall see that the following comment by Catherine Lim is nothing but liberal, anti-PAP, bourgeois, elitist wishful thinking, “”PAP fatigue” among Singaporeans that is a result of PAP’s lack of nurturing Singaporeans politically, and failing to provide the proper environment for political education and growth.”

And who will care then if ministers pay themselves millions of dollars. I mean even the WP’s “base’ ministerial salary is $852,500 versus the PAP’s $1.1m. Waz 25%? The voters know that if the WP becomes part of the government, they will take the difference and keep quiet. I mean I don’t hear the WP MPs offering to take S$11,000 each, and publicly donating the balance to a charity.

One way the PAP and government can go wrong is that the PAP and govmin don’t do “circuses”. They don’t know how to spend tax-payers’ monies entertaining voters.

The other way is that they love FTs too much, thereby negating the message they are trying to send S’poreans that “S’poreans matter”. We are always hearing that less FTs, less propsperity from the local MSM, quoting alll manner of ministers, officials and “experts”, usually from local universities (esp from SMU) and broking houeses. The latest is variation on the theme that FTs are good for S’pore: yesterday, ST reported an economist from Merrill Lynch, an investment bank, as saying, “Part of the reason for the sticky inflation is that policies such as the tightening of the inflow of foreign workers are keeping wage costs high. These are being passed onto the consumer.” Knowing the reputation of the economist in question, ST most probably left out the other factors he cited, focusing on FT shortage.

FT love also means that the measures to cut back FTs will be not be serious, and enforced lightly, annoying S’poreans.

So there is al to fight for. The PAP’s continued decline is not assured, neither is its revival.


*In a report dated December 2011, Citi said meeting higher expenditure needs without running a fiscal deficit will not be a problem for Singapore’s government. While the fiscal surplus may shrink, its economist estimates that the government can draw on an additional $1-3 billion in net investment returns, without breaching the 50% cap on the amount of long-term expected real returns on reserves.

An annoying ministerial boilerplate remark

In Economy, Political economy, Political governance on 13/01/2012 at 5:35 am

It was reported by CNA that DPM Teo Chee Hean (one of the better ministers in my view) “said the government’s focus is on ensuring that Singapore remains the best home for all Singaporeans.

‘Beyond developing an attractive living environment and a thriving economy which sustains good jobs for its citizens, Singapore also needs to strengthen the bonds that Singaporeans have with one another and with the country.”

My bitch is about “good jobs for its citizens”. If anything the government has attempted to “developing an attractive living environment and a thriving economy” by making it difficult for the wages of citizens to rise despite rising housing prices and cost of living expenses. It does this via its “FTs are most welcomed” policy, which keeps wage costs down. To be fair, the FT policy also helps keep property prices up. See next posting.

It is a fact that FT HR employees aggressively pitch to the employers, the merits of their compatriots. I know a manager in an MNC wanting to employ a S’pore-trained lawyer, being sent nothing but the CVs of Filipino-trained  lawyers by his, you guessed it, Filipino FT HR manager.

Even though it has now promised to moderate this policy, it has not changed its views on the importance of this policy. Hence its constant ministerial refrain that less FTs means less GDP growth and less jobs for S’poreans. And the constructive, nation building media and academics from SMU keep on harping on the unhappiness of employers who want cheap FTs, and the costs to the economy (including less full time jobs for ploy grads).

S’poreans got money meh?

In Economy, Political economy on 06/01/2012 at 7:15 am

The SDP, KennethJ, Lina Chiam and many regular contributors to TOC and TR are forever harping that standards of living for the majority of S’poreans have dropped since the 1990s. I take these comments with a large pinch of salt, even though I am an agnostic when it came to the claims of the PAP and government that living standards had improved throughout the noughties. (What am I supposed to think when the CEO of HDB tells me that shrinking flats means a higher standard of living for occupants? Yes I am misquoting but not that blatant leh.) 

They would say that wouldn’t they?

Still I was surprised yesterday evening when catching up with the local propoganda sheets, I read, While Singapore has 900,000 HDB flats and 557,000 car park lots  [or 619 for every 1000 flats by my calculations], Mr Khaw noted the problem of car park shortages was mostly felt in older HDB estates, which were built under old car park provision norms. In estates with four-room flats for example, 560 car park lots were planned for every 1,000 flats.

“This was adequate in the past but not any more. More Singaporeans now own cars and some own more than one car,” said Mr Khaw, who noted that 5 per cent of HDB households own two or more cars. The equivalent norm now is 710 car park lots for every 1,000 flats. With these new norms, Mr Khaw assured that new HDB flats would come with adequate car parks. Today on 24 December.

This means that despite rising public housing prices and COE prices, more HDB dwellers (remember over 80% of S’poreans live in HDB flats) are owning cars than ever before.

Of course, this could be another Khawism like his S$8 heart operation.

Assuming, Khaw was not fibbing about the numbers, will the SDP, KennethJ, Lina Chiam or the many regular contributors to TOC and TR Emeritus who are forever harping that standards of living for the majority of S’poreans have fallen, explain how come so many ordinary S’poreans are rich enough to own cars (some even two) despite rising COE and HDB prices?

Does this have anything to do with the easy availability of credit? And if so, is it good or bad for S’pore?

Maybe the 60% of voters who voted PAP are not deft? And one LKY is right to wonder why 40% of the voters are not gtrateful to him and the PAP.

Come on PAP critics. The silence is deafening.

What the news of the numbers of PRs owning HDB flats (and how it was reported) tells us

In Political economy, Political governance, Property on 29/11/2011 at 6:31 pm

(I waited eight days after the data on PRs owning HDB flats came out because I wanted to see if the local MSM would give a favourable-  to the government- spin on the data, which the MSM could reasonably do. The MSM was silent.)

Last Tueday, BT reported that  S’pore permanent residents (PRs) owned some 48,700 HDB flats as at September 2011 , according to the Ministry of National Development. It was answering a PAP MP’s question. According to this, there were approximately 1,038,473 flats as of May 201o.

This means that 4.7% of HDB flats are owned by PRs. So those lurid figures (over 20%, if I remember correctly) claimed by TR are not true.

It was also reported that 39,100 units in the 3rd Quarter 2011, are rented out. Assuming that the rentees are all FTs (PRs and other foreigners), a not unfair assumption, this means only 8.5% of the flats are occupied by FTs. Again, nothing near what TR claimed (over 30% from memory). 

Now as PRs are 13.9% of the resident population or 10.2% of the total population*, and PRs and other FTs 37.1% of the total population, these HDB numbers indicate that PRs and other FTs cannot be a major cause of HDB price rises. If  the 8.5% of the flats are occupied by FTs were 30- 40% (in line with their share of the population), then they would be a major cause of price rises. So Mah was right to he said that PRs and other FTs had no or little effect on public housing prices?

The way to look at this piece of data in relation to all the data made available is that FTs  have an effect (disproportionate perhaps?) because the supply was not keeping pace with demand given the influx of FTs. Khaw’s programme of building a surplus buffer is an admission that there was insufficient supply when the FTs were flooding in, courtesy of the government that we voted in in 2006.

No surprise then that the government and PAP spin doctors, and ST and MediaCorp staff missed telling us shumething important. This piece of info shows that Minister Mah did not know the numbers, or was fibbing when he said that PRs and FTs had no or little effect on public housing prices. They had an effect because he goofed, and then was in denial.  Hence the silence when the local MSM or spin doctors could have rubbished TR’s assertions, and the belief that FTs are the the major cause for HDB price rises?

This piece of information helps give some perspective to the ongoing (often heated and irrational on both sides) debate on public housing and immigration. Yet it only appeared in BT, which is behind a pay wall most of the day. Later Yahoo! reported it. This reminds me of what David Boey in a letter to Voices wrote, ” [R]elevant information is sometimes unavailable to the public or is not presented in a consistent format to facilitate analysis.”

How true and sad. Can fix this lack of info or not, PM? Will be a test of your promise of more openness, and change.


*”Singapore’s total population stood at 5.18 million as at end-June 2011. There were 3.79 million Singapore residents, comprising 3.26 million Singapore citizens and 0.53 million permanent residents, and 1.39 million non-resident foreigners, ” Department of Statistics report released on September 28th 2011.

“Singapore’s total population stood at 5.18 million as at end-June 2011. There were 3.79 million Singapore residents, comprising 3.26 million Singapore citizens and 0.53 million permanent residents, and 1.39 million non-resident foreigners.”

Why moving ministers around or out is gd for everyone cont’d

In Economy, Political economy, Political governance, Uncategorized on 24/11/2011 at 6:02 pm

(This piece is a continuation of Let me be clear: My analysis of the u/m minister’s performance is based on publicly available data. I am drawing reasonable inferences by connecting the dots. Nothing personal against the minister. In fact, the minister is a better example than Tan Jee Say, of a poor boy made gd under the system in place in the 70s and 80s. BTW, he and TJS were both born in 1954 and were in RI. )

There is still one cabinet minister who underperformed twice, possibly thrice and who is still in the cabinet. 

Lim Hng Kiang was HDB minister from 1994 to 1999, and has to take part of the blame that there was oversupply in the early noughties, something that Mah is blamed for. Mah took the lesson to heart and proceeded to build too few flats resulting in a world first: public housing prices rising in a recession.

He then became Health minister and told us complacently that we had to accept that people had to die in the SARS epidemic. Rumour is that one LKY did not buy into this when his wife fell ill and it was feared she might have contracted SARS. In August 2003 (after the worst of the epidemic had passed), Khaw became health minister and started reforming the public health system.

Lim Hng Kiang has been the Trade & Industry minister since 2004. S’pore is once again facing an economic slowdown , the second in three years because two of our main drivers of growth are not diversified. The exports of pills and electronics tend to move in the same direction.

Is the failure to develop new and diversified drivers of growth partly his fault? We had a recession in 2008- 2009 and a looming slowdown today because the main drivers were correlated. Whatever happened to the plans articulated by then DPM Lee Hsien Loong in the early noughties to have less correlated drivers of growth?

As he has been in the ministry for about seven years, how come we are seeing no changes in the drivers of growth?

And remember the wikileak cable from the US embassy here,  “The MPs, who were all members of the ruling People’s Action Party (PAP), indicated that Island could not rely on MTI (and EMA) to stand up to Temasek because MTI Minister LIM Hng Kiang is “weak” and not part of the PAP “inner circle,” Reading claimed.”

So why is he still in the cabinet? PM should follow his dad’s policy of ruthless execution of underperformers, not his successor’s and his (pre May 2011) tolerance of underperformers.  His dad must be aware of what  Bertolt Brecht, the famous Marxist and German playwright, meant when he wrote, “The finest plans have always been spoiled by the littleness of them that should carry them out. Even emperors can’t do it all by themselves.”

If you are reading this M John, please realise that the best RI boys are not necessarily those with high academic credentials like yrself, Goh Chok Tong, Hng Kiang, Raymond Lim or Tan Jee Say, who then become highly paid ministers like Goh and the Lims. Think rather of self-made billionaires like Peter Lim and A Hussain. One juz has an ordinary degree and the other never went to university. They are the people who do RI proud, not the scholars turned civil servants/ soldiers turned ministers who one can reasonably (but nastily) argue are effectively on state welfare from age 18 until they die.

It is sad that according to a junior minister 60% of the poor who need help don’t want welfare. Yet there are underperforming millionaires, living off the state.

Why are trains overcrowded, but not the port or airport?

In Infrastructure, Political economy, Political governance on 17/11/2011 at 6:21 pm

When I read on Wednesday that Singapore is improving the International Cruise Terminal with the aim of seeing the number of berths double by the second quarter of next year, it reminded me of the constant planning and work that goes into upgrading S’pore’s links with the rest of the world, which I contrasted with the reasons (excuses?) given for the overcrowding on our trains, which according to a media report on Sunday would take up to 2018 to resolve, and which led to the usual howls from netizens that there was bad planning by a government that didn’t care about commuters comfort.

I remembered a few years ago analysing how forward looking was S’pore when it came to developing the airport. S’pore was always planning to grow the airport so that it would never get congested. This was unlike Thailand. A few months after the new airport was finally open a few years back after failing to be completed on time, the new airport was working beyond its planned maximum capacity, resulting in congestion and delays.

I remembered remarking in a report that this could never happen here. S’pore was always expanding capacity, knowing that it took time to build infrastructure. It never wanted the airport to look like a congested, overcrowded slum. It gave a bad impression to visitors.

Likewise the port.  It is  always expanding capacity and erring its projections on the side of overcapacity rather than congestion. And it’s doing the same for the cruise terminal. Singapore is investing heavily in cruise infrastructure to ensure the industry becomes a driver of growth for the tourism sector.

If the government errs, it errs on the side of overcapacity, not undercapacity. It feels that the demand would be there, and even if it didn’t materialise as planned, the spare capacity would attract demand.Contrast this spending with what happened in public housing and trensport. In this Donald Low explains why the government became wary of building more public train lines and public housing. It all has to do with projections that went wrong in the 1990s.

The contrast in the spending patterns seem to show that comfort and well-being of S’poreans are not as important to the government as securing the engines of economic growth? In the name of latter, building to meet possible demand seems to be in order, but not when it comes to the former? Why not?

Note that the plans for development of the rail, sea and air transport links are made within the transport ministry, whose spending plans are scruternised by the finance ministry. Yet the approach seems different between domestic and international links.

S’poreans are rich

In Economy, Political economy on 08/11/2011 at 4:20 pm

Wonder why!/FabricationsAboutThePAP or YPAP or SDP don’t tell us things like these? Don’t know economics or money not enough?

Healthcare: Who is subsidising whom?

In Political economy, Political governance on 12/10/2011 at 8:30 am

So, we the people, are going to get more help from the government; and in particular the Health Ministry will do more to help those suffering from chronic illnesses. My friend who suffers from a chronic illness will be hoping the government walks the talk.

He tells me that the cost of buying “unsubsidised” medicine in Johor Bahru is more or less the same as the same “subsidised” medicine bought from SingHealth via a polyclinic. As the price of the medicine bought from SingHealth is roughly half that charged by a private clinic here, he thinks that is why the govmin claims it is “subsidising” the medicine bought from SingHealth.

He thinks maybe the government’s medicine procurement policies are inefficient. How come a profit-making M’sian pharmist chain can match SingHealth’s prices? Or maybe that the government is paying the drug makers more so that they will make pills here and invest in R&D facilities here.

In other words, are polyclinic patients subsidising rich MNCs so that the government can boast of its success in attracting drug companies to set up pill-making plants and R&D facilities here? Their presence here, incidentally, boosts GDP growth and, indirectly, the bonuses of ministers and senior civil servants.

S’poreans have long asked where’s the subsidy in public housing? The government ties itself in knots, trying to explain where is the subsidy. So much so that many S’poreans don’t believe that there is such a subsidy.

So here’s another “subsidy” that should be queried by the public.

On a wider point, ordinary S’poreans should join the Opposition and activists in querying how the government defines any “subsidy”. We are unlikely to get straight answers, but the questioning ensures that they know that we are not daft.

S’pore: The trouble with AAA-status

In Economy, Political economy on 10/08/2011 at 6:59 am

Singapore is one of the few remaining AAA sovereign borrowers, especially one without any fiscal issues.

So money will pour in, interest rates will drop, and property prices will fly.

The banking system may soon have more cash deposits than it knows what to do with. In the 1970s in  Switzerland, banks were paid to accept deposits i.e. negative interest rates.

This is a tough problem to solve. If our central allows the exchange rate appreciate  in order to slow the inflow, a more expensive Singapore dollar will hurt exports and tourism. If it doesn’t act, then Singapore will face significant inflationary pressures. House prices will fly even higher, SBS, SMRT and the electricity suppliers will fleece us even more, and CPF rates will drop to 0.1%, if not negative. We will pay the government interest on our forced savings. OK I exaggerate on the likihood of this.

Even the late Dr Goh Keng Swee might not have been able to solve this problem.

S’pore still has AAA- status

In Political economy on 09/08/2011 at 6:21 am

So all those S’poreans who believe that their CPF monies are not safe, should think again.

As the US loses AAA, where is a safe harbour?

In Economy, Political economy on 08/08/2011 at 2:50 pm

Nowhere as everything is priced in US$. In the 1970s, a US Treasury Secretary said to the Europeans and Japanese, “Our dollar, your problem”.

Today, the US should say to China etc, “Our debt, your problem”.

“If I owe you a pound, I have a problem; but if I owe you a million, the problem is yours,” John Maynard Keynes

Spending S$4.9bn justification for S$470bn +++ reserves?

In Political economy, Political governance on 24/05/2011 at 9:37 am

President S R Nathan said recently that the recent recession, in which the government for the first time sought his office’s approval to draw on reserves, has validated the need for Singapore to have strong national reserves.

He must be talking of the S$4.9bn that was used to fund the government budget in 2009 and which has since been returned.

Juz taking into account the monies managed by GIC, and Temasek’s funds,  our reserves then were at least S$470.3bn. This means that only 1% were used to fund the recession budget.

Do we need such massive reserves when we draw-down so little, given that the reserves are not the result of nature’s bounty but of the people’s savings.

SingTel dividend helps pays the bills

In Political economy, Political governance on 22/05/2011 at 10:20 am

SingTel is paying a dividend of S$0.258 a share.

For those S’poreans like me who have kept the SingTel shares we were allocated all those many yrs ago, the money is coming in handy. I still have the 1667 shares I was allocated and this means I will get S$430.09. Peanuts compared to the 8 months bonuses’ coming the way of ministers, but for a retiree (with no pension, only CPF) any little bit helps.

Sigh: once a upon a time S$500 was “peanuts”; not any longer.

Give PM a 100 days

In Political economy on 20/05/2011 at 5:35 am

PM after the election said he had listened to the voters. I for one was sceptical, thinking it was 1984 all over again, when newbie LHL said the PAP had to listen. The PAP fixed the system instead.

But he has turned from Clark Kent look-a-like into a tiger that has got ministerial duds to want to get out. The dysfunctional duo, MM and SM, have left (after publicly stating they wanted out). The three stooges (Wong, Nah and Lim) are no longer ministers, after telling him privately before the GE that they wanted to quit. If you believe this …

Since six ministers have “retired” (the sixth is Cry Baby Lim), let’s give him the benefit of the doubt. Let’s give him 100 days to prove to us he is walking the walk of listening to us and amending policies to meet our concerns.

Wondering abt the origin of the term “100 days”?

It originally refered to Napoleon’s return from exile on Elba to Paris on 20 March 1815 and the second restoration of King Louis XVIII on 8 July 1815 (a period of 111 days). During this period, he became emperor again, fought and lost the battle of Waterloo, and abdicated again.

BTW empty vessels seem to be making the most noise. The SDP and RP seem to be releasing media releases left, right and centre. Both parties did not do well. The RP even had to borrow candidates from SPP to field teams.

Returning to the past

In Political economy, Political governance on 15/04/2011 at 5:54 am

Lucky Tan reminds that we have been here before. While the GRC helped to retain seats for the PAP …  If nothing was done, there was a good chance the PAP would lose a few GRCs in the 1991 elections. The PAP had 2 choices – fix their policies so that ordinary Singaporeans will benefit from them or tweak the system to retain their dominance. The PAP chose to do the later by linking votes to estate upgrading … sad to say their “kiasu” nature got the better of them and the % votes for the PAP went up after that.

Well we are back to 1991, and the PAP has the choice of listening or tweaking again, to avoid losing a few GRCs. It is clear from the PM that the PAP “don’t do listening”. NTUC minister’s “Deaf frogs” comment comes to mind.

So it’s tweaking the system again.  But what can it tweak? The PAP is still trying the upgrading approach. But I’m sure the PAP knows that this is not enough, so what else can it do? What is the 2011 equvalent of upgrading for PAP areas? 

I don’t think there is one major new tweak, but here are several tweaks that it can do.

Given the reserves that the PAP-managed town councils have built-up, the PAP could offer voters the carrot of lower maintenance charges. The town councils could even afford to pay part of the utility bills of poorer residents.

The excuse: allievating inflation pressures, is now a better use of town council reserves since inflation is so much higher than bank deposit rates.

The the government can increase welfare spending and use the PA to administer it.  

I’m sure that the combi of asset enhancement,, smaller bills for residents in PAP areas, and increased welfare spending via the PA will win the PAP the Kiasu votes, juz as asset enhancement in PAP areas did in 1991.

The disconnect that matters

In Political economy on 31/03/2011 at 6:36 am

The disconnect that matters is not the one that exists between what the government does and what the media says. It is the one between what the media says and what people actually think about their lives, blogged Alistar Campbell, once Tony Blair’s spin doctor.

In S’pore, the disconnect is even worse. The disconnect is between what SPH, MediaCorp and government say and the facts on the ground as perceived by reasonable people.

Anyone relying on SPH, MediaCorp and government statements for their understanding of Singapore would have believed that there was no poverty here; that social workers would deliver delicious cooked meals to welfare receipients; that all FTs were talented people that S’pore needed; that FTs did not put a cap or drive down on the salaries of S;porean PMETS; that the liberal immigration policies did not strain the public transport and housing, and social infrastructures; that public security was good; and that ministers were all worth a lot more than they were being paid. Read the rest of this entry »

RP: Boorish behaviour

In Political economy on 24/02/2011 at 6:02 am

When the news broke that there were resignations from RP, the Sec-Gen issued a statement. It made allegations and insinuations abt those who had quit:

— The timing of this departure, its highly co-ordinated and planned manner and the way the individuals then went to the Press, hardly seems an appropriate response to personal incompatibility.

— an action designed to do maximum damage to The Reform Party and gain maximum publicity for the political careers of the individuals involved.

then there was an account of an “ang pow” incident which seemed to insinuate that there could be corruption (although the Sec-Gen denied making an allegation of corruption.)

Contrast this with the response of Tony Tan and Hazel Phua. They wrote, In the short one year plus that we have been in the Reform Party, although we have our disagreements, we have also seen the SG’s drive and dedication.  Since we cannot achieve agreement, we do not wish to be in his way. 

They also answered the “ang pow” allegation, an explanation that sounds reasonable, though $400 sounds a bit too  rich for kids.

The Sec-Gen is a gd economist, speaker and writer. But he is no gentleman as this statement shows and his petulance over the leaking of his letter to SDA showed.

Now not being a gentleman may not be be important in S’pore*, but being accident prone is. Can anyone trust a guy who has been involved in disrupting three parties: SPP, SDA and now his own RP?

*Example- the letters of condolences that MM, PM and SM sent to the sons of JBJ


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