First, we have our dear old Lee Kuan Yew reminding us, in April this year, that we are not developed[link]. Now, we have a Malaysian (Malaysiakini) telling us that we Singaporeans live miserable lives. He talks about Singapore citizens living in Third World conditions,like poor peasants, with no electricity and with barely enough to eat because they can't afford the high cost of living in Singapore. Our social policies are really bad partly because of a lack of a social safety net. It makes no difference for the poor whether Singapore is a developed country or not.
It is not just our social policies that are Third World, it seems that some people believe our economic policies are Third World too. You have Kenneth Jeyaretnam, son of JBJ and a former hedge fund manager, who says that our economic policies are like that. In a recent speech at the Foreign Correspondence Association lunch, he mentions that our growth for the past few years depended on the input of cheap labour and low consumption.
As a result of the input of cheap labour, the productivity of the work-force stagnated and fell. Unlike a developed country that produces high-end value-added goods, we have nothing of value to add except cheap labour; which is unsustainable. If a foreign MNC decides to leave Singapore, it is not because we voted for the opposition (like the PAP say) but because we have nothing of value to offer the rest of the world. Whose fault is that? Who was responsible for the total control of our economic policy over the past decade? Who was responsible for our decline in productivity and our reliance on cheap (usually foreign) labour?
According to Kenneth Jeyaretnam, our domestic consumption has been driven down to the same levels as China. Skeptic wonders whether it is because there are a lot of PRCs in Singapore. :) But seriously, what is the point of having high growth when we live a hand to mouth existence?
If things get too bad, we may have to export people to look for jobs overseas, just like the Philippines.
Here is an excerpt of his speech. The full speech can be found here.
Kenneth Jeyaretnam
"In some of my economic articles for the Party I have talked about an outmoded economic model which doesn’t really improve the welfare of the bulk of Singaporeans. While the GDP growth rate over the last few years looked impressive, fuelled globally by an unsustainable growth in US imports, the productivity of the workforce first stagnated and then fell sharply. Growth was built upon the addition of seemingly inexhaustible inputs of cheap labour from abroad with concomitant dire consequences for the real wages of those at the median and below. Domestic consumption has been driven down to a level that is on a par with China and countries at a much earlier stage of development. The savings rate rose to 47% in 2008 which given what little we hear about the decline in value of our external investments is manifestly excessive. Yet all we hear from the government is that we need to have more of the same policies of cutting business costs and just wait for the inevitable return of the US consumption binge."
See also: "If I am a Malaysian" , Wayang Party
5 comments:
I hope there will be no walkovers in HongKah GRC in 2011. I will fly back just to vote.
When your only solution is a hammer (raise GST, cut cost of business) ... every problem is a nail (Lazy Sinkapooreans)
The IR is a clear example of the government's so called economic policies, namely make money for itself, through the vehicle of Temasek.
After being so long in power, it is forgotten that state and party are distinct, but instead, the party no longer knows of any distinction and thinks that state is but resource for itself, which is modelled as a company, and branded as Singapore Inc.
And so as a company its primary objective is profits, and not social benefits or development or justice.
For what kind of value added jobs do the IRs offer? Dealing cards and serving drinks to - now a little scarce - very rich clients, is hardly an ennobling thing and not something worth dying for - if we have to fight for this company called Singapore Inc.; and where is there a company where an employee is willing to die for?
And even so, in all probability, again from the profit maximisation motivation, these jobs will go to low priced foreign workers, maybe the Filipinos.
So how do the IRs ever benefit the Singaporean?
Third world? Economically, no...I see Singaporeans queuing up to buy $million condos. Spiritually, yes...look at the way Singaporeans behave. And the support for 377A which would be out of the question in any first world country.
As someone from an actual Third World country, I can categorically state that Singapore is nowhere near that standard. It is much better off than you may think.
At least Singapore relies heavily on secondary professions such as manufacturing. That is better than the Third World which still relies predominantly on primary work like agriculture and mining.
Unfortunately, manufacturing requires the lowest cost base and Singapore can't compete with the likes of China in that respect. Labour in China is much lower than in Singapore. Ironically, this is because the living standard in Singapore is so high.
So Singapore has to diversify towards tertiary professions like banking, medical services, research or even tourism. These require suitably qualified individuals.
There is "brain drain" out of Singapore as more qualified Singaporeans go overseas. So it is natural (and right) for the government to try and encourage foreigners to come in.
I wish my own country was as far-sighted. Instead it keeps out foreigners in fear that they would take work away from locals. But the reality is that there are not enough locals left to fill all the positions.
Finding a niche for Singapore in future to generate income is going to be difficult. I am glad I am not in the government to solve that problem.
Post a Comment