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BASIC IDEA #3: Ban Political Parties From Commercial Activities

Basic Idea #3 is in response to the AIM-the-PAP-S$2 co saga.

When it first caught the public attention late 2012, I was just starting out in social media. Amid the flurry of discussions, what piqued my interest was what Singapore’s laws have to say about the relationship between political parties and their legal commercial, for-profit entities.

My interest centred specifically on the messages and comparisons that Lee Kuan Yew made on several occasions (unfortunately, I do not have the links). I recalled that he spoke about political parties in Asia that own huge commercial interests (e.g. prominent multi-storey buildings among other possessions). His PAP government sought to differentiate SG by framing laws that, for e.g., limit the amount of money donated by individuals, no donations from foreign parties/individuals, limit to the amount spent per voter in the constituency contest etc. For e.g., currently, the Election Dept specifies The maximum amount a candidate can spend on election expenses is:

  1. in the case of a GRC, an amount equal to $3.50 for each elector divided by the number of candidates in the group; or
  2. in the case of an SMC, an amount equal to $3.50 for each elector.

These and other measures are meant to minimise the use and need for money to fight and win an election. The aim being to win on the force of one’s arguments (and, perhaps, personality) instead of relying mainly on money to gain the upper hand…hmm, maybe that sounds good if you have been the dominant political party for a long time. Regardless, on the face of it, as a fair-minded person and one who believes in the evils of money politics and money or the lack thereof crowding out would-be candidates (like the insane US$1bil that Obama & Romney spent in 2012), I was proud of our election laws in this regard.

My exploration of the Societies Act and the Registry of Societies yielded no clarity whether political parties are legally allowed to own commercial, for-profit businesses. Via email inquiry, the reply I got was in 2013 was, “The Societies Act does not prohibit a registered society to set up a company to carry out its commercial activities.  With regard to the ownership of a company, you may wish to contact the Accounting and Corporate Regulatory Authority (ACRA) at 6248 6028 or visit their website at http://www.acra.gov.sg.”

The discomforts and even objections of Singaporeans in general to S$2-AIM’s specific involvement in the purchase of Town Council software are the right response. But could we be missing the woods for the trees? What is the bigger, potentially graver issue here? I submit that all Singaporeans ought to be even more concerned, that without any legal impediments to owning commercial entities and as the cost of electioneering will continue to increase, the day when Singapore politics go the way of our neighbours’ in which political parties own outright or via proxies mainstream media, cable networks, properties and many other industrial and commercial interests cannot be too far away.

In practical terms, political parties will take a leaf from PAP-dummy (pardon the jab, it comes naturally the more I read what he writes and reasons) Calvin Cheng’s initiative, and will be paying Facebook, Google, Youtube etc serious money such that their election messages appear at the top of any search by voters. This will unfairly influence voting patterns. Likewise, serious money for MSM advertisements etc. Do we want that in Singapore?

It is a real pity that LKY is not around to enlighten us why, despite all his overt words, moves and grooves to differentiate our political electioneering from our neighbour and the world at large, he had not said anything given that AIM was already established on 21 July 1991 when he was still PAP Sec-Gen. What was he thinking? ‘What’s wrong with collecting a little more money?’. Perhaps. Therefore, other than allowing each political party to legally own its own premises (reasonable size fit-for-purpose and not a grandiose #1 Raffles Place equivalent), we must elect MPs who will support Basic Idea #3 i.e. a change in the Societies Act to immediately disallow all political parties from owning commercial for-profit entities.

Oh, I almost forget the PAP Community Foundation (PCF) is ostentatiously a foundation supposedly, by definition, ‘given to rendering financial aid to colleges, schools, hospitals, and charities and generally supported by gifts for such purposes.’ Well, the question to whether not-for-profit organizations (such as the PCF) should be included is, ‘With the PAP govt’s newfound, increased largesse to ‘subsidize preschool and senior care services’ (2 of PCF’s core activities) with taxpayers’ money, should we not be better off taking Deep Throat’s advice to ‘follow the money’ to find out which pockets all the subsidies are going into and then make the decision to, perhaps, ‘nationalize’ PCF?



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Degree Mills and Fake Qualifications: The Cesspool of Meritocracy

Here is what an executive of a dodgy institution said as revealed by a 2012 Washington Post news article 
We guarantee 100 percent success. No matter what, we will place a business management degree in 
your hand from a reputed university that we are affiliated to. You can go abroad, apply for jobs with 
these degrees. The certificate will not even say the words ‘distance education,’”

It looks like the “abroad” of choice may well be Singapore given the ease with which foreigners get jobs 
and citizenships with qualifications from degree mills or fake qualifications. And the scale of the 
problem? Here goes

A government commission listed 21 “fake” universities, many no more than a mailing address, a sign 
over a shop or a hole-in-the-wall office. 
A technical institutions regulator named 340 private institutions without accreditation from the 
Of more than 31,000 higher education institution, only 4,532 universities and colleges had 

One state-run university awarded 2,660 doctor degrees in just 2 years for subjects not taught there. 
That is just India.

What Meritocracy? 
The government emphasise meritocracy as the cornerstone of its success. Merit must also be paid, as 
the narrative goes and hence a veritable gravy train for the ministers and the civil service. Never mind 
the moral hazard of this peculiar line of reasoning but do they merit that gravy train?

The sordid affair of the IDA need not be repeated here. However can the IDA managers think of nothing 
but utterly inane reasons for their actions to sop off the public, only to flip-flop later? What about the 
ICA giving away citizenships without, it appears, minimum due diligence?

These acts are not of those civil servants elsewhere commonly underpaid but of the best remunerated 
civil service in the world.  High pay for merit?

Excellence, Competence, Reliability 
Another line of reasoning is none of these are due to the agencies but of an imperative to deliver 
workers indiscriminately to feed the strategy of growing the economy far beyond what can reasonably 
be expected given constraints of land, population and not least high income.

However, Singapore’s place in the sun can be attributed to its “brand” of excellence, competence and 
reliability. It can be argued that meritocracy played a strong role at least when it really meant what it 
meant, not what it is today. Maintaining the brand require a quality labour force but the indiscriminate 
employment of foreign workers without proper diligence on skills, qualification and suitability can only 
adulterate quality and tarnish the brand.

It will eventually risk the economy for the government is striving for first world status not by the pursuit 
of the required diligence but by relying much on third world quality of labour and work attitudes. As a 
retired German engineer, a frequent visitor told the writer as he saw it Ja, what can you expect
(regarding train breakdowns)? You have first world infrastructure maintained 
by so many third world workers.”

A fundamental contradiction apparent to everyone but government it seems. Does productivity needs 

In 2014, the US state of California convicted Juan Malaluan TenorioJr, Glyn Cordova Villegas, James 
Quijano Leoncio, Philip Tolentino Sarmiento, Laurence Viernes, German Zagada and Jude Dagza Leoncio 
up to 3 years imprisonment. All 7 were found guilty of using forged nursing school transcripts from the 
Philippines to become Registered Nurses.

Draconian it may be but lives were in harm’s way. However, at a minimum, citizenship / PR approvals 
and various employment passes needs to be rigourously reviewed even if it cost tens of millions. That is 
a small price to pay to maintain not only the integrity and reputation of the Singapore economy and its 
institutions but also the quality of the labour force. The whole process including those who employed 
foreigners must be subject to closer scrutiny.

The apologists may argue there is a difference between qualifications from degree mills and fake 
qualifications but this is mere semantic of irrelevance to Singaporeans displaced by foreigners of dodgy 
qualifications. It is worth remembering that in the past overseas degrees from many well known 
universities were regarded as somehow second class.  When there is easy acceptance of getting ahead 
not by merit nor excellence but by cheating and obfuscation, then meritocracy has plunged into the 
cesspool of degeneracy.

Besides, can anyone imagine the CEO of a famous brand like Daimler Benz ever risk tarnishing the brand 
by going…….. cheap? 
Chris K 

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PAP’s ‘Govt Serves All’ Volte-face…Walk The Walk

“Let’s put it this way, it’s a democracy … you decide what you want to choose, for better or worse. I will tell you that we will endeavour to do our best, whatever the outcome.

All of you remain Singaporeans. You don’t vote for us but we are here to still continue to provide policies that cut across every division.” Tan Chuan-Jin, 20 Apr 2015

Let me state upfront that I am not convinced of the sincerity of the apparent volteface in PAP’s policy. Leopards do not change their spots. And if they now appear to due to modern science, or as in the case of PAP politicians due to modern technology (chiefly, social media and a more vocal electorate), the change will have to be carefully observed and confirmed from actual practice and performance and not mere pronouncements – by a junior minister barely 4 years as a PAP member.

Here’s why.

Whilst many of us can quickly juxtapose Tan’s words with that of Mah Bow Tan’s utterance as Minister of Nat Devt, ‘‘Upgrading for all wards, but PAP ones first’ (Straits Times, 11 Jun 06), let us be reminded that the ‘PAP ward first’ policy has been in place for nearly 20 years and that it was articulated by the very highest PAP officials – and as ministers.

It was first publicly told to Singaporeans by PAP Sec-Gen & PM Goh Chok Tong himself. “You vote for the other side, that means you reject the programmes of the PAP candidate… If you reject it, we respect your choice. Then you’ll be left behind,then in 20, 30 years’ time, the whole of Singapore will be bustling away, and your estate through your own choice will be left behind. They become slums. That’s my message.” (‘We will fight GE as local election’, The Straits Times, 23 Dec 96.)

Then, as recent as a month short of GE 2011, from the current PM Lee Hsien Loong at 2011 NUS Ministerial Forum, “Between the people who voted and supported the programme and the government, and the people who didn’t, I think if we went and put yours before the PAP constituencies, it would be an injustice.” There was a huge adverse reaction by citizens to Lee’s reported remarks.

And who can forget the Grandmaster LKY himself in the heat of the 2011 hustlings, “Aljunied has five years to live and repent.” I couldn’t figure if the Old Man sounded ‘more desperate then reckless or bold’. Yeah, but he sure ‘left it out there cold, too far gone to care…..’

We are seeing the volteface of a terribly flawed and arrogant way of governing. It showed no less the defective mindset, the DNA of PAP leaders whose persuasion weapon of choice is through threats and intimidation. Should Singaporeans continue to vote for such leaders and leadership?

I’m fully persuaded that there will be no apologies for the ‘injustice’ done to the longsuffering residents (both PAP & Opposition voters) in Potong Pasir, Hougang & Aljunied/Punggol East.

As such, what Tan Chuan-Jin has uttered is no more done for the sake of winning FMM (fence-sitters, marginal supporters, mal/mis-informed) voters. And NOT a true change of heart of the hubristic PAP who continue to believe in their heart of hearts – wrongly and, hopefully, fatally – that only they are talented and deserve to rule Singapore.

So, how will we know when there is a true change of heart? Let me suggest that to be when the day we see these 2 changes made – but only as a visible start and evidence:

One, the depoliticization of Town Councils (and related organizations such as RCs, CCCs etc) preferably back to HDB to manage as it was prior to the Town Council Act 1988 and the managers of the related organizations to be elected by each constituency voters not appointed by MPs.

Two, the depoliticization of The People’s Association. We are talking about an organization with a yearly budget of more than S$1bil (51.3% increase over FY2014). The money is ostentatiously disbursed for activities and facilities to serve residents but as always via PAP’s own money-sucking network of supporters and not necessary through meritorious considerations.

BOTH sets of organizations would have been rightly politically-neutral in their constitutions were they not adulterated and hijacked by PAP to serve their party’s interests more than residents and voters.
BOTH the above 2 actions will begin to demonstrate that Tan’s pronouncement is not merely words to win over voters.

“Lips and tongues lie. But actions never do. No matter what words are spoken, actions betray the truth of everyone’s heart.” Sherrilyn Kenyon, Born of Fury

Or more succinctly, PAP ‘walk the walk…do not just talk the talk’. Ex Brigadier-Gen Tan will understand if and when we ex-NSF believe that he’s just talking cock.

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GIC’s Chief Investment Officer “Talks a Good Book”

In financial markets, “talking a good book” means constantly playing up one’s investment achievements 
while ignoring failures; sarcasm usually intended. So it seems  Lim Chow Kiat. Chief Investment Officer of 
GIC, when he penned the article “Investing for the future: GIC’s long-term view” (http://www.straitstim
Mr Lim wrote euphemistically about how “GIC’s performance has indeed benefited from a long-term 
perspective” and “our investment return gained substantially ……..enduring the short-term uncertainty, 
and occasional short-term pain, has paid off.” He also touch on key points of investment which are 
summarised as follows; 
On Governance Framework. “Assuring stakeholders that our portfolio is managed according to our 
mandate is essential. We have a ‘no surprises’ policy, which means we are proactive in raising issues 
relating to risks and future challenges as a way of building and maintaining the confidence of our clients 
and board of directors.” 
On Investment Mandate. “Whether it is our client’s mandate to us or our mandate to external 
managers, we look for clarity. Clear statements on the return objective, risk capacity, and scope of 
authority give fund managers the confidence to construct the best portfolios for delivering sustainable 
results. In particular, the appropriate time horizon for evaluation should be discussed and agreed on 
On Communication. “First, communication is important to surviving the long and often bumpy ride. 
Long-term investors not only need to get the investment call right but also need to maintain stakeholder 
confidence that the investment strategy will most likely turn out right, even if current market prices 
indicate otherwise.” 
As a financial markets professional of nearly 35 years, the writer finds little to fault Mr. Lim’s articulation 
of general investment principles. However there are a couple of critical issue peculiar to Singapore  
which paints Mr. Lim’s article as rather less than grounded in reality. 
Going by Mr. Lim waxing lyrical about the need for “clarity”, to “maintain stakeholders’ confidence” and 
all those nice sounding words relating to scrutiny and transparency, then by “stakeholder” he can only 
mean the government. That is because the ultimate stakeholders, i.e. Singapore citizens, do not have the 
benefit of the scrutiny and transparency inferred by the euphemisms since they do not even know the 
size of the reserves let alone the crucial expected long term real returns which determine the amount of 
returns spent in the budget. 
In sheer contrast, Norway’s Government Pension Fund (GPF) leaves no doubt that the stakeholders are 
Norwegian citizens and it is to them that scrutiny and transparency are meant to maintain confidence. 
Unlike the GPF, the assets managed by GIC did not come from natural endowment but from transfer of 
wealth from household balance sheets to the government balance sheet via elevated land prices, low 
rates of return on CPF and GLC-induced cost of living. It also comes from denying citizens social 
equalization benefits. Singapore citizens are the stakeholders referenced by Mr. Lim’s writing even if, for 
him, the only stakeholder that matters is the government. 
GIC has World Best Client 
Mr. Lim waxed especially lyrical about investment returns having “gained substantially from the 
compounding of returns, the patient harvesting of long-term risk premiums, the counter-cyclical 
rebalancing of our portfolio, the ability to take advantage of short-term dislocations in financial 
markets”. He puts it down to long termism. 
Be it as it may but, Mr. Lim is being disingenuous because unlike most other asset managers GIC does 
not face the pressure of investor redemptions, i.e. clients withdrawing their funds in period of poor 
performance or even if a good performance fell short of investor expectations. GIC has the world’s best 
client, the Singapore government, who not only never redeems whatever the circumstances but 
continues to pour in funds even when performance is lacking. 
Yet citizens are told 4% long term real return in US$ terms is “good return”. That may be “good” if it is 
meant only by meeting the benchmarks adjusted to reflect GIC’s portfolio mix. However, with that huge 
advantage conferred by the Singapore government,  GIC ought to consistently beat those benchmarks, 
no ifs no buts especially since in Mr. Lim’s words, it allows GIC to do all those things he wrote such as 
“the patient harvesting of long-term risk premiums“.  By accepting the current returns as “good” when 
they ought to be demanding more, the directors of GIC which includes the Prime Minister himself, are 
giving the Chief Investment Officer and his team of portfolio managers a rather easy ride on the 
government’s coattails. GIC can have its “long termism” as Mr. Lim puts in but in the real world of asset 
management, it can make managers complacent. 
Mr. Lim is right about clarity and the need to maintain stakeholders’ confidence. Nobody should appoint 
an asset manager who is not transparent and not subject to performance pressure. In sheer hypocrisy, 
the government does not feel the need to be transparent in order to maintain the confidence of the 
ultimate stakeholders. Put in another way, should any stakeholder be confident about a government 
who feels the need to manage its finances in secrecy? 
Chris K 


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      Cabinet Reshuffle – A Hustler’s Shuffle?

      Reading the latest cabinet reshuffle, I’m reminded anew Jackson Browne’s ‘Information Wars’. With apologies to him, here are my revised lines contextual to SG.
      Give us twenty minutes and we’ll give you the world
      We bring good things to life
      The news you need from people you can count on
      Doing what we do best

      The government of Singapore
      Your true voice
      You’re in good hands
      Now more than ever before

      …The latest spin on the shit PAP’s in, blow by blow
      And the more you read, the less you know

      Here’s a ‘blow-by-blow’ response to the PAP spin.

      The changes are part of continuing leadership renewal “to build a strong ‘A’ team for Singapore”, Mr Lee said on Facebook.

      Come on, lah. What ‘continuing leadership renewal’? Same faces. One 4-term old cock who’s announced he wanted to quit government, another a 2-term rear admiral-minister proven a failure leading from the rear on transport issues. Two never-fought-a-battle generals/1-term promoted-in-a-hurry ministers with nothing quantifiable that benefited citizens significantly to show for. And one minority minister-MP who I’ll comment on separately.

      What’s common to all 5 PAP supposedly ‘A team’ talents? I’ll tell you: ALL 5 got into parliament originally via the coat-tails of others in GRCs. ‘A team’…hahaha! Not one talented and with balls enough to fight one-to-one to enter parliament.

      Lim Swee Say has been hailed as the ‘best immediate choice’ to lead the Ministry of Manpower, ‘given his experience representing the unions and workers.’

      The outgoing Tan Chuan-Jin says he had not realised the extent of the MOM’s reach, which includes retirement adequacy, employment opportunities, workers’ rights, and workplace safety and health.’
      If true, then it’s not just the blue-collar workers but all of us PMETs are also done in and done for.

      What can we expect of an ex-NTUC chief who led his members to the lowest relative increase in median wages? Whose members could no longer afford to pay for their most basic HDB flats on their own wages but now need PAP cabinet’s faux largesse of more grants just to own 2, 3 or 4-room flats that are also smaller than when my hawker-father-office-maid-mother could pay for their open-market S$17k 3-room flat within 8 years and without a single-cent grant from LKY’s team mid-‘80s?

      ‘Retirement adequacy’? What can we expect from a minister who proclaimed insensitively, ‘Every month, when I receive my CPF statement, I feel so rich and the best part is, I know the CPF money won’t run away’? How will he who feels ‘so rich’ even begin to understand what retirement inadequacy is, never mind how to address the issue?

      We are dead meat in Swee Say’s hands, PMETs. Very suay.

      Now, Tan Chuan-Jin. In the real world of accountable-to-stakeholders organizations, an employee gets promoted for measureable KPIs. How does Tan measure up after 21 months as acting minister and 11 months 8 days as full minister? Any real and specific number of PMETs you have directly helped with his JobsBank initiative to land a job

      What of ‘retirement inadequacy’? Someone help me here or is it also zilch? Am I more retirement adequate now with this ‘A Team’ minister after 32 months + 8 days with his S$5mil salary safely taken home?

      Next, our favourite ‘Minister Stumblebum’, this kee-kiu Minister must address with a cap ‘M’. He’d be writing to tremeritus.com editor to complain if I do not.

      His trajectory is not unlike his fellow (but junior BG) Chuan-Jin. So, no need to belabour the point about having nothing measurable to show for…except perhaps the headcount of happy aunties and uncles with their free chicken rice for attending a PAP activity.

      Inche Masagos may well desire his promotion. Cabinet ministers, MPs, academics and all kinds of pundits have chimed in their views. Even lau Goh highlighted Inche Masagos’ promotion. Oh, Masagos himself also spins it well;

      ‘In an interview with MediaCorp’s Berita, Mr Masagos said: “It would seem apparent that the Malay community would celebrate having two full Ministers in the Cabinet for the first time, but I think this is also how Singapore runs on the basis of meritocracy.’

      I’m truly sorry to say #fail for lack of humility on the latter observation. Isn’t it arrogant to say that one has been promoted ‘on the basis of meritocracy’? The subtext is, hey guys, I’m really a talent! One would have thought that the first words would be to thank voters who voted me into parliament resulting in another opportunity to show that I could serve their needs.

      As for ‘two full Ministers in the Cabinet for the first time’, has it occurred to Inche that maybe it’s because the current minister Yaacob has been proven to be a dud? Therefore, to save Yaacob’s face and his own poor judgment, PM Lee has to bring in one more to see if he can neutralize Yaacob’s failure? Hey, why is the Information & The Arts minister sidelined from helming ‘The Smart Nation’ project? (Giving it to Vivian, the Youth-Olympics-Budget-Overrun-Big-Timer, is another story for another day, dear taxpayers.)

      On Liu Tuck Yew, Tattler describes him succinctly, the ‘poor guy already submerged way beyond his depth with the onerous Minister for Transport hat’ and we are supposed to believe that Liu is ‘A team’ renewal candidate? (…my toes 🙂 )

      So, how to believe PAP’s spin of ‘continuing leadership renewal’ and ‘strong A team’?

      Doesn’t it look more like

      • a desperate move to temporary plug sinking PAP-Sampan v2.0?
      • a callous move to ignore PMETs’ cries for measurable support to retain or regain employment?
      • an overt attempt to address the sinking support level with the Malay voters?

      Now that we can see a perspective cutting thro’ the spin, for PM Lee to suggest that he has done the reshuffle to build an A team ‘for Singapore’ , can believe or not? Folks, that’s after a 20-year apprenticeship + 10 year premiership – and no more than 20 months, probably less, to the next GE?
      Tell it like it is: It’s for PAP to win the next GE. ‘For Singapore’? Nah!…alternative media, the more you read, the less you are deceived….



      SG Housing vs Other Superstar Cities: Sacrificing Academic Honesty As Offering To LKY

      Apple to Apple comparisons?

      It’s pretty obvious tt the median house price for SG is derived fr tt of HDB prices only. But the other 4 cities appear to be taken fr across BOTH private & public hsg prices.

      That being the case, there is already a built-in bias for the SG data to be lower than it actually is or shd be.

      The prof appears to hv conveniently but deliberately not tried to account for tt bias by then taking the median household income which includes those who buy public or private hsg. That naturally jacks up the median income number in SG’s case. In other words, the higher incomes of condo, landed property buyers are included in calculating the affordability ratio when those earners are NOT BUYERS of the hsg type in the study in SG case.

      If my doubts are correct, then the kindest tt can be said of Prof Phang is tt he lacked the academic rigour in his work. Perhaps, he was in a rush to complete her piece in time to justify n announce her admiration for LKY.”

      Below, Chris takes apart Phang’s oh-so-unacademic thesis, a real shame to sacrifice one’s academic if not intellectual honesty on the altar of blind admiration for LKY.

      Going by the SMU lecture “Home prices and inequality: Singapore versus other global superstar cities” given by Professor Phang, Singapore housing and by extension Singaporean household finances are better than Hong Kong, London, New York and Paris. However, the statistics and analysis are extremely skewed. Warning: This article gets a little wonkish but important.

      Housing Affordability

      There are several problems with this chart.

      The most obvious is that the SMU has used HDB prices as the median house prices when it should use the median price for all housing types to be on par with the other cities whose housing stock is predominantly private.

      Yet, the SMU has no qualms using median household income which includes those high income households which are ineligible for HDB housing.

      Median household income instead of simple median wages flatter Singapore’s affordability because of the much higher incidence of 2 or more income earners in a household. Singapore’s median household income is over 80% higher than wages, compared to 60% in London and New York and just 25% in Paris. All three have much better total fertility rates.

      In all 4 cities, pensions cannot be used to finance homes, therefore retirement funding are not depleted unlike Singapore.

      Particularly for New York, Paris and London, the low home ownership masks a high degree of residents renting for work but owning properties outside the cities.

      Income Equality

      The writer has frequently written about the importance of distinguishing between Gini coefficient before tax and social transfer and Gini after tax and social transfer. The former is obviously higher than the latter.

      The trouble with this chart is that the SMU may have used Gini after tax and social transfers (41.6%) for Singapore but the Gini before tax and social transfers for London, New York and Paris. Using Gini after tax and social transfers, London scored 0.34 according to the Work Foundation, i.e. below Singapore. Paris ought to be further below. This put the chart in a rather different light.

      Ideal Society?

      The SMU appears stretching the conclusion.

      Based on my estimates, the low inequality that has been achieved in the distribution of Singapore’s gross housing asset comes close to capital distribution in Piketty’s ‘ideal society’. The bottom 50 per cent owns one quarter of the gross housing wealth.”

      First, since French rockstar economist Thomas Picketty is invoked, it should be understood his conclusion in “Capital in the 21st Century” that the ratio of capital to income, thus wealth disparity had returned to the 19th century had been found to be flawed, particularly in the way capital is measured in national income among other errors. (http://www.voxeu.org/article/housing-capital-and-piketty-s-analysis, an easy read).

      Where the trouble really begins is that Piketty’s tenet of the accumulation of capital was found to result from pension assets and entitlements both are not drivers of inequality, followed by real estate. However, unlike all 4 cities, Singapore’ gross housing wealth is funded by a depletion of pension assets and there is a complete absence of entitlements (state pensions, etc). Therefore, the use of gross housing wealth alone to reach the conclusion of achieving Piketty’s ideal society is massively overstating the case for Singapore especially when bottom 50%’s assets are heavily weighted in their primary residence due in the depletion in CPF and personal savings whereas the top 50% has more assets beyond their primary residence .

      Second. The tenure of real estate needs to be considered since physical capital such as real estate needs properly to be depreciated to estimate the long term wealth effect. With more than 80% of Singapore housing stock had their leases expire worthless, depreciation meant the wealth effect is less significant than the higher proportion of long leases and freehold property and the favourable treatment of lease renewals in the west.

      Fourth. A central tenet of Piketty’s theory correctly posits those who own capital benefitted more than wage earners because the return on capital exceeds GDP growth. Since the top 50% owns more risk capital (shares, 2nd real estate) than the bottom 50%, then wealth disparity has increased beyond what is measured by the Gini coefficient especially since real estate returns far exceeds GDP growth. Further, since the most of the bottom 50%’s assets beyond their primary residence is in CPF, then the 3.7% aggregated return from CPF being below GDP growth caused even greater wealth disparity.


      London, New York and Paris have strict preservation and zoning regulations, urban prevention laws, ancient laws and rights. The Economist magazine had this to say

      “Over the last few decades technological changes have greatly increased the return to locating in large cities filled with skilled people. Being in such places makes workers more productive and raises the income they are able to earn. But skilled cities have not allowed housing supply to expand to meet rising demand. As a result, quite a lot of the gain from employment in productive places is captured by landowners earning rents thanks to artificial housing scarcity. This may mean lower overall productivity, more income inequality, and more income flowing to capital rather than labour.”

      However, Singapore’s high prices are due not to these restrictions but to government land monopoly. Even if the SMU argued prices are still far better than the western superstar cities, there are already significant trade-offs because none of them has Singapore’s low productivity, high income inequality and low total fertility rate.

      Given its unreserved praise to government policies, perhaps, the SMU lecture should be seen more as political polemic and an ode to Lee Kuan Yew.

      Chris K

      1 Comment

      Whither LKY’s La La Land?

      Starting with the obvious; the answer to any ‘whither’ Singapore question lies with our youth, leaders of our tomorrow. 3 incidents give cause for real concern.

      First was the graffiti on the roof facade of Blk 85A Lorong 4 Toa Payoh in May 2014.

      Second, the fake Prime Minister Office’s announcement of LKY’s death 18 Mar 2015.
      Third and finally (maybe not), Famous Amos’ rant last week.

      Once, they say, is an happenstance, twice a coincidence, three times it’s enemy’s action (Ian Fleming’s ‘Goldfinger’, 1959). Earlier, in Chicago’s gangster era of 1920s-30s, variations were already cited with three times being ‘a habit’ or ‘a moral certainty’. We shall come back to this observation later.

      What are the common threads in what would have been 3 almost non-events or mere incidents in other First World lands but make international headlines (with the hoax, in more ways than one) for LKY’s La La Land?

      One, as already mentioned, all 3 happened in LKY’s La La Land aka as ‘Disneyland – with the death penalty’ (William Gibson, Wired, Sep/Oct 1993), incidents like these are not supposed to happen, not even once in 50 years.

      Two, all 3 drew their ‘inspiration’ or motivation from PAP-related governance of Singapore. None of which is complimentary in any way. The first is forthright in its condemnation and exhortation; ‘F*** the PAP’ and ‘WAKE UP SG’ (in caps no less)…as if to shout out the urgency of their exhortation. As if they the young are able to see more in their relative innocence than the rest of us daft adults busy chasing after the legal tender. The second stands out as mocking the very death of a ‘founding father’ credited with the almost god-like miracle of giving the perpetrator his good life and education. The last one directly celebrating the death of LKY in a way diametrically opposed to, different from and during the very worshipful, mourning mood week itself, no less.

      Three, all 3 were committed by 16/17 year olds. Youths who range from being social dropouts to the average or above average talents. These are our youths, whence reside the leaders of tomorrow Singapore.

      Deliquent or misbehavour exist everywhere in Singapore and in varying degrees. But if it’s not once, twice but three times within a year that such behaviour is played out on the national stage, is it then no accident or coincidence but…

      • ‘enemy action’ (or conspiracy) which is what the PAP leaders would expend state resources to find a ‘fix’ for,
      • or ‘a moral certainty’ that warrants more civic lessons in LKY’s globally-acknowledged education system (how ironic),
      • or ‘a habit’ that ministers must, first, blame on concerned parents and, second, the latter must remedy.

      Is that it? Is that all?
      There is another variation to the observation i.e. ‘three times it’s a pattern’. If so and if it correctly describes a generation of Singapore youth born entirely with the internet that knows nothing of and is raised thro’ nothing but LKY’s system of governance, policies and all, then all Singaporeans must be very, very worried – even and especially if LKY’s current PAP do not see it as such. It’s not just the education system but also the parents who raised them and, very importantly, the larger social dynamics within which they also interact within daily.

      Do we see the bigger significance of what these youths may be hinting to us or calling out the systemic malfunctions, if not failures, of LKY’s legacy – never mind the glimmering Singapore shoreline for us and the international eulogies for him (and, some like to believe, by extension LKY’s present PAP)?

      There are 2 possibilities before us;

      – “The honesty and efficiency that Senior Minister Lee has brought to Singapore are likely to follow him to his grave. “ Samuel Huntington

      – “The society Lee Kuan Yew has shaped will not…follow him to his grave…It may not look like the Singapore of Lee’s time…(but)…will thrive so long as our children know that the future of Singapore belongs to them.” Ho Kwon Ping

      Will it be the stark assertion by Huntington? Or the conditional observation of Ho’s?

      Or is there a third possibility?

      The possibility whereby our surviving parents of the overlapping LKY’s generation and we as parents come together to honestly see that the current PAP has gotten it all wrong in the current context with blindly employing the hench-man methods behind LKY’s core principles of building a Singapore to benefit all we the citizens of Singapore regardless of race, language or religion circa 60’s-80’s?

      That third alternative is not fully in the hands of our youth – yet. They are watching us, expecting us to bequeath SG to them in order that they can further learn to bequeath SG to theirs.

      I’ll make bold to suggest that NONE of the 7 youngsters in the 3 incidents will believe that National Service is worth a dime doing. All that glitters is worth naught if our next generation see little love to defend what we bequeath to them.

      Now, that surely is predictive damnation and the future demise of LKY’s La La Land. I say this very sadly, even I have come to feel the same way – if the Singapore Story continues with the PAP’s current narrative.

      Therefore, Change we Must.

      End PAP’s dominance.