PM Lee’s devotes a considerable, probably, the most defining concerns of Singaporeans, in his NDR to the issue of ‘Foreigners & Immigration’. In this regard, Profs Pang Eng Fong’s & Linda Lim’s ‘LABOUR, PRODUCTIVITY AND SINGAPORE’S DEVELOPMENT MODEL’ (The Singapore Economic Review, Vol 60, No 3, Aug 2015) is most prescient and pertinent as a mirror with which to examine the successes and failures of the government’s FT policy.
All the more so, since PM Lee frames the issue as one where ‘there are no easy choices…every option has a cost…a downside’, where even a certain choice can ‘tank’ our economy. Very unappetizing Hobson’s choices indeed – brought about by multi-mil$-paid ministers who claim they are ‘servants of Singaporeans’.
Note that PM Lee has not committed himself to any particular course of action. He merely reiterates that he believes that he is “doing what Singapore needs and what best safeguards your interests,” and expects voters to just plain trust him with 5 more years to do as he pleases, preferably without 1/3 parliamentary opposition.
An Objective Assessment of Labour & Productivity Policies
Profs Pang/Lim puts the government’s policies over the years in its original historical context. That of a young nation jettisoned from her umbilical hinterland unexpectedly with a mishmash of multi ethnical peoples facing some truly existential threats.
Hence, the route to development was quite unlike the other 3 more culturally homogeneous Tiger economies of HK, S Korea and Taiwan where they also already had a thriving private sector. “Singapore evolved a distinctive development model based on a large role for multinationals and an extensive involvement of the state in reshaping the economy and society“ but not quite the local private sector.
The government also intervened in the social system to promote values and attitudes favorable to nation-building, self-reliance and hard work, over the years imposing a multiplicity of controls and regulations which profoundly shaped Singapore society. Those controls include domestic capital (CPF, budget surpluses, reserves), land & property and the labour market.
By and by, citizens became highly dependent on the government for basic needs while looking to both government and MNCs (supported by tax incentives, infrastructure subsidies & labour policies) as ‘generator of wealth and opportunities – to the neglect of the local private sector.
A key in the government development roadmap was the ‘depoliticizing of the labour movement’, giving the government de facto control and employers greater bargaining power. Perhaps, Profs Pang/Lim are too polite to say that the movement was, in fact, ‘PAPliticizied’, just like the PA. However noble the original intentions of serving the People were, they all suffered ‘mission creep’ (à la strategic creep) to serve the Party instead.
The worst impact is the vice-grip control over workers wage levels under the fear-mongering rationale of losing out to other countries. Meantime, employers as good as completely disregarded the complementary need to invest in higher productivity through training or capital. Trumpeting glowing upshots, PM Lee and many Singaporeans do not see the irony of citizens with “S$1000/-“ household salary needing ever more grants from PAP government just to own a basic 3-room flat… Is this a desirable downshot when PAP had been in near absolute control of everything?
Labour Market Outcomes & Reconsideration
From 1970, foreign non-resident workers comprise 3.2% of our total workforce. This then sextupled to 28.1% in 2000 (Yeoh and Lin, 2012). Then, under Lee Hsien Loong’s leadership from 2004 and 2014, as if to outshine his predecessors, his team surreptitiously executed, non-transparent, non-accountable-to-parliament policy moves, further doubling foreigners from 603,000 to 1.3 mil. So, it’s already 38.1%, exceeding the 1/3 of our 3.5mil workforce. How does his current Manpower teammate cap it at 1/3 while still allowing in foreigners albeit at a slower pace? Minister, Math Magician or none other than the 1973 Senior Wrangler Cambridge Alumnus hoping to square the numbers – if we give them another 5 years to play around with?
Here’s the real deal. What Chris Kuan has also been writing about ad nausuem: Hui and Toh (2014) found that “employment as the driver of growth has increased its share from 31% in the 1970s to 75% in 2000s”.
Staying with Profs Pang/Lim’s objective study, we give credit where due. On the surface, the obvious gleaming, LED-lit, mechanical city and impressive skyline rightly testify to the success of PAP’s growth at all costs policies. Yes, progress made, lives improved vastly. But below that surface? The price paid is the 75% share of labour and employment as driver of growth while consumption as % of GDP is a miserable 40%.
In effect then, city & skylines we have to show for from those employment policies. But money in the pocket to actually expense to live Swiss-style? Little wonder most of us, while appearing to live rather comfortably, are stuck with the nagging, silent reminder that ‘money no enough’ even as train/bus fares and petrol pump prices increase in the face of oil price halving. The seriously out-of-touch PM Lee and his teammates, including Mr Tharman who upped the pump prices, ride no train/bus to work while taxpayers pay For the petrol in their Mercs. Only their math adds up…along with our cost of living. Not theirs.
But is PAP’s labour-as-3/4-of-growth gameplan in decay and nearing its inevitable end?
Profs Pang/Lim observe that if “big-ticket foreign investments” have been falling “since Singapore tightened its manpower policies and lost its attraction for companies that depend on cheap foreign labor” (Chia, 2015) it only “confirms that many foreign investments were attracted to Singapore because of the ease of employing foreign labor, rather than any intrinsic locational advantages.” Even EDB expects “a sharp reduction in the number of skilled jobs created, lower fixed asset investment, and a decline in business expenditure… in line with the Government’s restructuring exercise to raise productivity and reduce reliance on foreign workers” (Teng, 2015).
That just about puts paid to the claim that ‘foreigners create good jobs for Singaporeans’ sans serious downsides. Should the PAP Team be called to account, or given another 5 years?
Who Should Next Set – or Reset – Policies, Singaporeans?
With the intellectual, evidence-based, objective clarity of neutral academicians’ analyses of PM Lee’s vaunted PAP economic and labour policies now better understood, what next, Singapore?
PM Lee would have us believe – perhaps, covertly sharing Senior Lee’s characterization that voters are daft – that the PAP is the only proven team in town. Team PAP can do no wrong. When evidence points to the contrary, their Manpower Minister “reiterated that the tightening of the Republic’s foreign manpower regime was not a reaction to past mistakes”. No admission of blindsides. Nice $mil, just-trust-us job to hold on to with guaranteed “no sacking” policy.
Without batting an eyelid, using a National Day Rally (for a GE rally…AG, sir, isn’t it illegal?), Singapore’s PM pleads to Singaporeans, ‘Please support me. Please support my team.” Not unlike a second-hand car salesman, he pumps up all the good stuff but conveniently hedges his policy blindsides. We just need to take his word for it that whatever the horrible consequences of the ride he commandeers, hey, he’s doing what Singapore needs and best safeguards our interests.
Voters must be aware that each vote is also for those below 21 years, our children and theirs. The choice is clear, for all the good achieved, is the current Team PAP – lacking in accountability, transparency, caring more for theirs’ and their own interests via a parliament that they completely dominated for 50 continuous years – the one to trust another 5 years to do what they think is right, never mind what the People think?
Or do our children and we deserve that overdue change to reset our lives?
Law Kim Hwee