2econdsight

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PM Lee: 10-Year Outlook – The Economy Is A Big Problem

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The Problem Diagnosed
On a 10-year horizon, PM Lee thinks ‘the economy is a big problem’.

He says

‘we have to find a way to continue to grow in order that we can improve our people’s lives; because our workers aspire to earn higher wages, so our economy needs to create more and better jobs and collectively we have got to perform at a higher level – more efficient, more productive, more rewarding for our people.

How?

First, either you get productivity, you do better and perform better; or second you get the workforce to grow…more workers.

For productivity, he reasons that

“In this most recent decade the productivity growth has come down. This has been a very unstable decade because we have had the global financial crisis…many uncertainties in the world. But we have managed to grow with our own population topped up with foreign workers.”

In effect, he’s saying we should praise him for achieving growth, not blame him for the near-fatal FT overdose.

But he appears less than honest in his claim.

His chart shows in the 3 decades from 1984, productivity fell from 5.2% then 2.6% all the way down to 0.7% i.e. a jaw-dropping 86% drop during the 10 years he sat on the premier throne. In order not to look too bad, he projects a 2% productivity growth from 2014-2020. How neat and nice.

He conveniently left unsaid the major 80’s recessions and difficulties due to Paul Volcker’s stubborn but correct, seemingly over-done medicine of up to 20% Fed rates to tame the oil shock-induced inflation of the 70’s. The Asia Financial Crisis, 9-11 attack and SARS hit us from 1994-2004.

So, despite the ‘very unstable…many uncertainties’ of 1984 to 2004, we still achieved 5.2% & 2.6%. And despite being paid millions, his administration opted for the easy, orgasmic ‘open-leg’ FT policy to grow the economy like the Russians did during the Cold War – adding cheap labour – while almost killing productivity.

When the ill-effects from a foreigner overdose translated into the lowest GE support for PAP in 50 years, the proper and decisive thing to do is to stop the overflow altogether – at least for a duration. Did Volcker fear he might ‘overdo the medicine’ which, by the way, lasted only a few years and set the ‘table for for the long economic expansions of the 1980s and 1990s’? (link + link) Even an ‘angmoh’ Central Banker understood ‘长痛不如短痛’. Instead, 9 months after the 2011 GE, Lee ramped his top-up-6.9mil-with-foreigners plan down our throat!

Nonetheless, he now claims with a straight face (while hiding a crooked heart?),

“I fully understand Singaporeans who are anxious about the influx of foreign workers…on housing…on public transport, the competition for jobs…But while we slow down, we have to do it in a measured and a balanced way because you do not want to overdo the medicine. You do not want to cause our companies to shut down, particularly you do not want to cause hardship to our SMEs which employ many Singaporeans…to cause our own workers to lose their jobs.”

He is delusional to believe that he ‘fully understand(s)’ our level of anxiety. He has fallen hook, line and sinker (as did his papa) for the narrative advanced by the SME bosses and sycophant, overpaid GLC managers that Singaporeans are choosy, want high wages, incompetent etc. Truth is, no private boss putting his own money into for-profit businesses considers it his National Service to employ Singaporeans. Neither do hired managers or foreign head-hunters care for anything more than to meet their annual department budgetary figures.

Through it all, PMETs who have lost their jobs are completely unheard, unrepresented. Our unemployment statistics mask the reality because, unlike in the West, where someone who loses his job would register his status with the govt to obtain unemployment benefits. His jobless status and duration are captured. But not here in SG where we have zero unemployment benefits. Our govt is clueless how bad the situation is for above-40 PMETs, jobless for 6 months or more.

Not only is he delusional, his FT policy has failed on 2 fronts. Firstly, the FT overdose contains an unknown number of fake degree holders, an issue he has refused to address head-on. Secondly, instead of cutting off the overdose decisively – at least temporarily – our PMETs continue to lose jobs to foreigners…albeit at a slower pace! For some of us, our jobs and lives are only collateral damage in his relentless pursuit of GDP growth at all costs whilst pocketing S$3mil yearly and feeding the greed of already-rich bosses.

SkillsFuture – A Solution Based on Lack of Vision and Imagination
After his less-than truthful, self-serving defence of his economic stewardship, PM Lee then focuses on productivity growth.

He cites 2 examples; PSA investing in technology such that a ‘crane operator’ can now operate 5 instead of just 1 crane at a time and banks using data electronically to better assess potential borrowers instead of a relying on a loan officer .

With his superficial analysis, PM confidently concludes that, ‘Alright, everybody, the solution is ‘to stay ahead of the curve, prepare our workers for the future economy.’ And, the brilliant practical solution?

“That is why we launched SkillsFuture as a national movement.”

The emphasis being on skills; To

“prepare our workers and businesses for the future economy…our people will always have the opportunities to develop to the fullest with training available at every stage of your lives…You have to learn new skills…to do new jobs. Then when the world changes, we are prepared and we are able to change with it.”

Let’s look deeper at his PSA crane operator and bank loan officer examples again, with eyes different from his ministers and civil servants. Yes, skills to use technology to drive productivity is a no-brainer. But the real prize – the creation of not just high-value jobs but of WEALTH – is in the design and production of the original software to control the cranes, to analyze borrowers data! Not the better-skilled operator or another back-end bank job!

SkillsFuture is itself an oxymoron. How can one skill up for a future when one does not, cannot know the specific skills needed for that future still unknown? But it makes sense to position our Singapore to be nearer to or where any future new product, service or process has the best chance of being created. Proximity confers the advantage of understanding and supplying the skills needed to launch or support new businesses, products, services.

Besides, our own experience has shown that skills alone offers but a temporal advantage. Just recall how China and our ASEAN neighbours, with their lower land, ops costs, skilled manpower, supporting services, snatched the disc drive business from skilled Singaporeans’ hands and then completely sidelined Singapore from Apple’s current supplier chain ecosystem?

Furthermore, technological advancements and best practices will ensure that machineries will be designed to be idiot-proof such that even a lesser-educated person can be trained to operate them to achieve AQL (acceptable quality levels). Case in point; ‘skilled burger flippers and french fry-ers’ skillfully flipping and frying with idiot-proof designed kitchen equipment. It’s the same logic in manufacturing and service industries. The critical difference lies in the knowledge the skilled worker possesses –  understanding and then responding independently to unexpected events. Hence, for higher and enduring value-added, knowledge trumps skills.

Does the PM not know that In the last 50 years and going forward, tech innovation and entrepreneurial daring accounted for more of the new businesses and new jobs created across all economies?

For high-paying jobs, brand-new businesses – think Apple, Microsoft, Oracle, SAP, Google (upstaging Yahoo, itself a disruptor new job-creator), Facebook, LinkedIn, Virgin Group, Starbucks, Southwest Airlines/Air Asia, Priceline/Booking.com, Amazon and the like. All are founded on knowledge, not skills.

As for serial new job creators, think SMEs. Studies after studies have shown that SMEs account for the fastest and the most new job creation.(link + link + link)


The Alternative Solution: Create Wealth, Not Just Jobs

Knowledge and entrepreneurial daring, not skills, are what drive the growth of new businesses, creating wealth for society along with new jobs. We must think big, think different. Think businesses and jobs that were non-existent 20, 30 years ago.

In the turbulent 60’s, no one else in Asia but the original PAP leaders thought up, imagined a First World oasis in a Third World neighbourhood.  Achieved by being spectacularly efficient to attract MNCs to locate here when conventional wisdom then could only see import substitution. Sadly, PAP successors cannot see beyond their noses to imagine a new ecosystem by jettisoning controls of info, views and ideas. They refused to see the imperative to cast off fears of being watched, ridiculed or fixed. Instead of efficiency, we now have to be spectacularly effective in, encouraging, creating new ventures and adventures in innovation and invention. With globalization here to stay, we need to imagine, reinvent SG to be the first Neo-First World City, one ready for the 22nd century.

To seed entrepreneurial daring, we must bring down the costs of starting a business, particularly land, rental costs and all kinds of statutory fees and charges.

SkillsFuture plays but a lesser complementary role to the focused, holistic and sustained effort Singapore needs to unleash our energies, resources to begin creating that ecosystem to sprout new wealth, jobs from new products, services and business ideas. Aiming for and achieving such an outcome will leapfrog us far ahead of our competitors. Succeeding in SkillFuture can only give Singapore a step ahead in the curve, if at all. But far superior than staying ‘ahead of the curve’ is to identify and create the next ‘new curve’ – and the one after. New curves that our neighbours and those with land and headcount advantages cannot easily replicate.

Look at it another way. Innovators, inventors and entrepreneurs are the ones closest to their ideas and needs. Employees and workers are the ones closest to and most concerned personally to be able to catch the new wave of skills needed to stay employed. The right thing then is to leave it to these 2 groups to identify and secure their own skillset requirements. Not rely on civil servants sitting behind their screens analyzing time-lapsed data collected to then approve skill-acquisition programmes for subsidy.

Don’t get me wrong. There’s a place for laggard learners to acquire skills. But by the time that happens, employers will be looking to achieve efficiency to price-compete more than to command a price premium of their no-so new products and services. If so, where’s our competitive advantage given our limited land and headcount?

Conclusion
SkillsFuture as a national movement is therefore misplaced, one perpetually late in the game of new product, service, process curve. Yes, it can complement and support employers who can act faster and citizen-employees who can respond independently quicker to acquire skills needed for new ventures. The govt should not try to lead in ‘skilling up’ Singaporeans. Instead, its job lies in giving our children an education that instill in them the lifelong hunger and joy to ‘learn, unlearn and relearn’ (Toffler) at every stage of their lives.

THE new national movement that’s truly needed to redefine Singapore, not just for the next 10 years but beyond, is to create an ecosystem to raise and attract innovators and entrepreneurs with daring to spawn new industries and new jobs constantly for Singaporeans. We achieve that by focusing on knowledge acquisition and sharing across the entire spectrum of the voiced, written, printed and broadcast word, views, ideas in all areas of our lives much more freely than currently allowed. Next, on the practical side, where tax holidays were first conceived to attract MNCs to relocate here, we must now think what ‘show-me-the-money’ schemes are needed to attract pre-start-ups to want to congregate here.

Now, take a long hard look and a longer harder think still at the cabinet or potential PAP leaders. Which one of them have uttered words and discuss ideas to reveal that he/she is an innovative, imaginative leader? Futurist-thinker? Any dreamer at all in PAP?

It is no wonder that as realists and pragmatists, they can only come up with an ill-conceived SkillsFuture when what we truly need to leapfrog Singapore into mid-21st century and beyond is actually a visionary  ImagiNation+ as our new national movement!

I suggest and call on Singaporeans that…

We imagine a different Singapore future
A neo-First World Lion City of our mind
The proverbial City on the hill
A solar-powered post-post-LED lamp for all time

We imagine a Lion City made for the 22nd century
Where children’s minds roam free
Where our elderly are happy as can be
Where women and men flourish with spirit free

We imagine a Lion City without the weak unloved
Where our rich support our lesser ones
Where We are One United People truly
Where every citizen’s heart for his brother is warm

We imagine a future
One our eyes cannot now see
We imagine a future
Without the PAP   🙂

I beg to differ with PM Lee; 10 years, the PAP is our BIGGER problem, not the economy.

Law Kim Hwee

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2 thoughts on “PM Lee: 10-Year Outlook – The Economy Is A Big Problem

  1. /// We imagine a future
    One our eyes cannot now see
    We imagine a future
    Without the PAP ///

    Imagine no more. Your will have your opportunity to make it come true on 5 September or 12 September.
    My bet is on 12 September.

    Like

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