26 December 2011

A Contrarian View of the MRT Service Disruption

A breakdown of the MRT system that leaves trains and passengers stranded between stations is probably the most unfortunate thing to happen to a service provider.

When a bus breaks down, passengers can disembark and wait for another bus.  But when several trains lose power simultaneously, none of the passengers can disembark unless and until it is safe to do so.  Sometimes they have to wait for trained personnel to guide them to the next station on foot.  At other times, they have to wait for the train to be towed to the next station.  From there, they can continue using bus-bridges.  All these take place under the full glare of the public and the media.

The purpose of this article is to present a different view on some aspects of the service disruptions.

12 December 2011

Why ComfortDelGro Revised Its Taxi Fares

What does an organisation do when the services that it provides cannot cope with demand?

Noting changing trends in the demand for taxi services, in particular, strong population growth, increase in tourist arrivals due in part to the opening of the integrated resorts, opening of more shopping malls, and a more vibrant night life, which have driven up demand for taxi services throughout the day including traditionally off-peak hours and weekends and public holidays, Singapore's largest taxi operator ComfortDelGro revised its taxi fare structure to better match supply with the ever-growing demand for taxi services.

07 December 2011

Scrapping the Employment Pass Eligibility Certificate

The Employment Pass Eligibility Certificate (“EPEC”) scheme was discontinued recently after being in force for almost 20 years as it had not met its aim of helping companies recruit good calibre candidates, according to Ministry of Manpower.

EPECs were previously issued to applicants who fulfilled certain criteria, such as possessing selected university qualifications or being current or former holders of selected skilled migrant visas, and were therefore likely to be eligible for an Employment Pass if they managed to secure employment here.  An EPEC was valid for two years and allowed its holder to stay in Singapore for up to one year to facilitate his/her job search in Singapore.

With the scrapping of the EPEC, foreigners graduating from selected institutions of higher learning in Singapore may henceforth apply for a one-year Long Term Visit Pass to stay in Singapore after graduation to look for a job.

Other foreigners may apply for a three-month Long Term Visit Pass.

The EPEC scheme appears to be one of those schemes that were introduced years ago, and then probably forgotten.  It is right and timely to withdraw it if it is not fulfilling its objectives.

But was the EPEC scheme necessary in the first place?  An EPEC allowed its holder to stay in Singapore for one year, but the holder was not permitted to work because the EPEC was not a work pass.  How did the holder sustain himself for one year if he did not work?  Or was the holder employed surreptitiously and illegally?  A three-month Long Term Visit Pass is more than enough.

27 November 2011

Steering Singapore Out of the Last Recession

At the People's Action Party's convention on 27 November 2011, chairman Khaw Boon Wan presented some insights on the general election six months ago.

One of the several issues that affected the outcome was that, despite steering the economy out of the deepest recession since independence, the PAP was less effective in getting political mileage out of it.

Singapore is a small open economy.  It has one of the highest ratios of trade to GDP in the world.  Its growth and economic prosperity depend greatly on international markets, and are consequently volatile.

22 November 2011

Private Property Investment as a Route to Permanent Residence

An entrepreneur who invested in a business in Singapore could include an investment in an owner-occupied property as part of his application for permanent residence for himself and his family prior to 1 January 2011.

Investing in property was removed from the eligibility criteria with effect from 1 January 2011 and is no longer a consideration in the evaluation of applicants for permanent residence.

Economic Development Board ("EDB") said this in a letter to The Business Times on 22 November 2011 to correct a statement by Mr Ngiam Tong Dow in his article "Climbing the Global Economic Ladder".

Mr Ngiam is a former chairman of EDB.

It is puzzling why EDB allowed an investment in an owner-occupied property to satisfy, even partially, the criteria for permanent residence, and stopped the practice only this year.

It might arguably have been quite reasonable several decades ago when Singapore was in dire need of capital, although it would certainly have been much better had the permanent resident entrepreneurs invested in manufacturing or services, instead of real estate.  After all, they were entrepreneurs.  And they wanted to be granted permanent residence.

Furthermore, many of the new permanent residents would probably have needed to purchase a property for themselves and their families to live in anyway.

Especially in the past 20 years or more, not only did Singapore not need foreign capital to be invested in private property, but also it is incomprehensible why such non-productive property investment should be allowed to partially satisfy permanent residence criteria.

EDB finally stopped this practice on 1 January 2011.

21 November 2011

Government Subsidies for Foreigner A&E Patients

Foreigners accounted for 18 per cent of the approximately 780,000 accident and emergency ("A&E") patients treated at publicly funded hospitals each year, Minister for Health Gan Kim Yong told Parliament.

The government subsidy given to foreigner A&E patients is $14 million a year.

This is less than 1 per cent of the annual $2.2 billion government subsidy given to publicly funded hospitals.

Mr Gan was justifying the government's practice of providing the same subsidy for all A&E patients, regardless of their nationality.  It kept the administrative procedures simple given that A&E departments serve patients with critical, life-threatening medical conditions or who require emergency attention.

Mr Gan appears terribly confused.

13 November 2011

Businesses, Politics and Economics

Business people expressed their admiration and concerns for Singapore in three separate articles recently.

'S'pore Has Done What the West Failed to Do' The Business Times (19 Oct 2011)
Businessman and economist Charles Ormiston, Bain and Company's Southeast Asia chairman, is impressed with how the Singapore government has addressed the country's economic issues.  The government, according to him:

Has twice in the past year instituted measures to slow the rate of growth of property prices to reduce the size of the bubble.

Runs budget surpluses when other countries are in deficit.

A government may need to run a budget deficit if the economy requires fiscal stimulus to help to get it grow out of a recession or to serve as a catalyst in the face of anaemic economic conditions.  For such contingency, it is better to draw on reserves accumulated from budget surpluses to fund an occasional budget deficit than to rely on borrowings.  Nevertheless, oversized accumulated reserves resulting from persistent large budget surpluses may imply that the government has been collecting too much tax and other revenue, or not spending enough on its operating or development expenditure, or both.

29 October 2011

Risky Chinese Loans for EFSF

Mr Klaus Regling, the chief executive of the European Financial Stability Facility, met with Chinese government officials to discuss how best to structure the EFSF to attract money from China.

EFSF may consider issuing bonds in yuan if China approves of the arrangement.

Is this a wise move?

Aren't Americans a Silly People?

Americans are a silly people.

The tragedy is that not many Americans acknowledge their silliness nor how their silliness may affect the future of their country and the free world, possibly within their lifetime.

23 October 2011

What the Unemployment Rate Means

Singapore's seasonally adjusted unemployment rate for residents was 3.0 per cent as at June 2011, according to Labour Market Second Quarter 2011, published by the Manpower Research and Statistics Department of the Ministry of Manpower.  The non-seasonally adjusted unemployment rate for residents was 3.9 per cent.

Most people think they know what the unemployment rate means, but it is likely that few really do.

The unemployment rate is defined as the ratio (expressed as a percentage) of unemployed persons to the total number of economically active persons.

Who are considered unemployed?

Who are considered economically active?

17 October 2011

Economic Performance and Forecasts

The Ministry of Trade and Industry recently released advance estimates of Singapore's GDP for Q3 2011.

The economy grew 1.3 per cent on a quarter-on-quarter basis, after it had contracted 6.3 per cent in Q2.  As a result, Singapore avoided a technical recession.

The government expects GDP to grow 5 per cent for 2011.  No forecast was provided for Q4 2011.

Two observations may be made.

12 October 2011

Poverty Amidst Riches — The Income Divide

"The real problem we have here is that people who work are still poor.  Immigration keeps wages down, and the unions are very weak.  This island is still talking about small government, big market.  But people are getting angry now."

Professor Wong Chack Kie from the Chinese University of Hong Kong was not talking about Singapore, but it almost seemed that he was.

03 October 2011

The Plight of the Under-Employed in 2010

For many people, the concept of employment seems straightforward.  If a person receives an income from work, he is employed; otherwise, he is unemployed.

In practice, not many people are familiar with how employment, unemployment and under-employment are measured.

What does being employed mean?

15 September 2011

Repealing Internal Security Act

Malaysian Prime Minister Najib Razak announced today that the government would repeal the Internal Security Act to ensure a modern, mature and functioning democracy.

The 51-year-old law allows almost indefinite detention without trial for acts that are considered to be a threat to national security or to prevent such acts.

Critics say that the law has been abused by the government to silence dissent.

The Emergency Ordinance, which allows suspects to be detained without charge for up to two years, will also be repealed.

Two new laws will be introduced for preventive detention, to be used in cases of terrorism and to ensure that basic human rights are protected.  Under the proposed new laws, detentions can be extended only by the courts, shifting the power of detention from the executive to the judiciary, unless it concerns terrorism.

The government said that it had decided once and for all that no laws would be enacted allowing for individuals to be arrested (or more importantly, detained) for having different ideologies.

Will Singapore follow suit and repeal its Internal Security Act too?

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This post was updated.

24 August 2011

How Important are Tony Tan's Background, Experience and Knowledge?

There is no need for Singaporeans to fear the future with the right leadership, said presidential candidate Dr Tony Tan Keng Yam.

Is Dr Tan saying that the People's Action Party government formed after the May general election does not constitute the right leadership for Singapore unless and until he is elected as president to complement the government?

In his presidential campaign, Dr Tan repeatedly stressed that his background, experience and intimate knowledge of the financial markets and the global economy will be invaluable.  The possibility (according to him) of a perfect storm of problems affecting the global economy makes it highly likely (according to him) that the next president will be involved in decisions about Singapore's economic future and in this regard, he will be able to contribute and help the government and the ministers to understand the situation better.  Moreover, he knows all the cabinet ministers very well.

21 August 2011

Who is Most Likely to be an Independent President?

Whom would you vote for in the Presidential Election this Saturday?

If the election is for a President to perform the ceremonial functions of a head-of-state, we may choose Dr Tony Tan Keng Yam.  He was a former Deputy Prime Minister and, following his retirement from politics, deputy chairman and executive director of Government of Singapore Investment Corporation.

But the post of President was changed from one appointed by Parliament to one elected by the people in 1993 for one reason.  The Constitution gives the President veto powers in the following five areas — spending of past reserves; key public sector appointments; detentions without trial; corruption investigations; and restraining orders to maintain religious harmony.

In two areas, the President must consult the Council of Presidential Advisers, and his veto may be overruled by Parliament.  In the remaining three areas, the President may exercise his discretion only by concurring with an official view against the Government.  The scope and limits of the President's veto have been dealt with in an earlier post [link].

15 August 2011

Scope and Limits of Powers of the Elected President

What are the scope and the limits of the powers of Singapore's elected President?

Public acts and speeches of the President

Except as provided by the Constitution, the President must act in accordance with the advice of the Cabinet or of a Minister acting under the general authority of the Cabinet in the exercise of his functions under the Constitution or any other written law.

Stated another way: in the discharge of his Constitutional functions, the President can only act and speak as advised by the Cabinet.

But, what about other public acts and public speech of the President that are not related to the exercise of his Constitutional functions — does the President need the advice of the Cabinet?

12 August 2011

Blaming Stock Market Fall on US's Credit Rating Downgrade

Many people link the volatility and the sharp fall in the global stock markets with the US's losing its AAA rating on 5 August.

They are mistaken.

The volatility and the sharp fall in the global stock markets are a reflection of the fear and concern that the US will enter into a recession, and the realisation that there is neither political leadership nor political will to do the necessary to bring about strong economic growth — growth that will result in job creation and bring down unemployment, which will lead to increased demand for goods and services, which will lead to business investment and higher earnings for businesses and individuals, which will lead to higher taxable income with which to reduce the deficit and national debt.

The compromise that allowed the US debt ceiling to be raise will shrink entitlements and other government expenditure, but will not raise additional taxes on the wealthy.  Focusing on shrinking the deficit and the national debt when the recovery is lacklustre will ensure that the recovery remains lacklustre at best or sinks into a recession at worst.  It cannot work.  It won't work.

06 August 2011

Fighting Unemployment or National Debt

When a country faces a stagnant economy, high unemployment and a bulging national debt, what should the government do?

Many economists believe that the government should spend to get the country out of the slump.  When times are bad, the man in the street is likely to tighten his belt because he may have lost his job or he may be afraid of losing his job.  Businesses are unlikely to expand production in the face of weak demand, and may even cut production.  That leaves only the government.  The government has to spend.  But it has to spend wisely.  If the government's expenditure gives the money to citizens who do not spend it, the expenditure has little effect.  The government should spend on projects that will create jobs, such as teaching and security services, and building or upgrading infrastructure.  As the multiplier effect kicks in, it will result in a healthier economy, bringing with it higher employment and higher output, both of which increase taxes while reducing government expenditure on unemployment benefits.

For many months, the US House of Representatives, which is controlled by the Republicans, blocked President Obama's attempts to raise the country's debt ceiling.  They insisted that any such move be accompanied by a reduction of the budget deficit through cutting entitlements without increasing taxes on wealthy individuals or businesses.  It didn't matter to them that the higher debt ceiling was to accommodate budget measures that had already been approved by Congress.  It did not matter to them that opinion polls showed that the majority of their constituents were in favour of lowering the debt by a combination of cuts in entitlements and selective tax increases.

Much time was wasted.  The debt ceiling was eventually raised on 2 August, together with cuts in entitlements.  But no increases in tax.

Meanwhile, the economy was hardly growing.

How can the US economy grow if the (official or U-3) unemployment rate stands at 9.1 per cent.  Almost one in ten adults who want to work, are available for work and have recently actively searched for a job are jobless.

The U-6 unemployment rate (total unemployed, plus all persons marginally attached to the labour force, plus total employed part time for economic reasons, as a percent of the civilian labour force plus all persons marginally attached to the labour force) was 16.1 per cent in July.  Almost one in six adults who want to work and are available for work are unemployed or underemployed.

Consumers are the driving force of the US economy.  If large numbers of them are unemployed or not fully employed, who will buy the goods and services?

The US government itself is shedding jobs, because the Republicans don't want big government.

Companies are not expanding because there is insufficient demand for their goods and services.  Worse still, companies are importing goods because imports are cheaper than those produced domestically.

The US government should provide incentives for companies to produce in the US instead of importing from overseas or relocating offshore, unless such relocation is motivated by a need to be near to their customers.  This is not the time to be charitable, exporting jobs to other countries when there are so many Americans who are unemployed or underemployed.  Especially when those other countries grow economically, politically and militarily as a result of the Americans' generosity (or lack of common sense), and thumb their noses at the US.

The US government should repair and upgrade the country's infrastructure.  Given its debt situation, it is bizarre, and probably unacceptable to its citizens, that it is spending money on building schools in Iraq, Afghanistan and elsewhere in the world, while cutting back on such expenditure in its own country.

The US government should end its involvement in the wars in Iraq and Afghanistan.  Forget about pride or philosophy.  If the war in Afghanistan could not be won after ten years, it cannot be won.  It cannot be won because many Afghans themselves seem indifferent as to whom their rulers are, although they may change their minds rather quickly if the Taliban eventually takes over.  It cannot be won because it is almost impossible to distinguish between ordinary Afghan citizens and ordinary Taliban.  It cannot be won because the Taliban and al Qaeda are very patient and can afford to be patient, but the Americans and its allies cannot afford, and do not want, to stay in Afghanistan forever.  It cannot be won because the Afghan government believes it does not need the Americans (other than their money) and its allies.  It cannot be won because Pakistan allows the Taliban and Al Qaeda to take refuge on their side of the border, in the mistaken and dangerous belief that these terrorists may be useful in their fight against India.  The US should accelerate its withdrawal and save its money and the lives of its soldiers.

Standard and Poor's lowered the US's credit rating from AAA to AA+ on 5 August.  China's official news agency Xinhua insisted that China had every right to demand the US to address its debt problem.  The US should cure its addiction to debt and live within its means, as it could no longer borrow its way out of its mess.  China is the largest holder of US government bonds, the result of an imbalance in trade flows between the two countries, itself the likely result (at least partially) of China's holding down the value of its currency.

Vitriol aside, China has a point.  But it is judicious government expenditure coupled with principled taxation of the wealthy that will produce economic expansion to provide the US with the means to cut its deficit and reduce its debt.

The US is not alone in focusing on fighting debt rather than unemployment.  Many European governments are also shrinking their budgets in order to cut back their national debt despite slow growth and high unemployment.

These countries are probably headed for anaemic growth, if they can grow at all.  They may even slip into a recession.

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This post was updated.

03 August 2011

Liberalising Public Bus Services

Earlier this year, The Workers' Party proposed that the public bus system be nationalised to reduce cost and raise efficiency and effectiveness.

While the idea had its merits, I noted that there were practical difficulties [link].

The Government's response was that it would lead to inefficiencies and high cost instead.

Recently, National Solidarity Party ("NSP") proposed that the public bus system be liberalised to allow the entry of multiple private bus operators who may be smaller and more nimble.  They would respond more quickly to changes in demand; those which didn't would lose market share.

Operators would apply for licences to operate along existing routes managed by Land Transport Authority, or propose new ones.  Such routes might duplicate MRT routes to compete with, and supplement, MRT services.

The Government's response was that operators would cherry pick, going for the popular and profitable routes and shunning the unpopular and unprofitable routes, and the result would be higher fares for the latter.  The existing operators — SBS Transit and SMRT — are obliged to operate services along all designated routes.

NSP says that licence fees should be used to subsidise fares along unpopular routes.

NSP should provide quantitative proof that its model works.

If competition reduces fares along the popular routes, will the operators earn enough?  The operators have also to pay licence fees that must be large enough to subsidise the fares along the unpopular routes.  Presumably, NSP is not suggesting that the Government subsidise, even partially, the fares along the unpopular routes?

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Notes

1. Public Transport: Why the PAP and WP Positions Fall Short of Commuters’ Needs National Solidarity Party (26 Jul 2011).

2. Why “Cherry-Picking” is Good for Commuters National Solidarity Party (1 Aug 2011).

01 August 2011

Treating Donations to Charity Equally and Equitably

When a person makes a donation to an Institution of Public Character (commonly referred to as a charity), a Government approved museum or a prescribed educational or research institution, he/she is entitled to a tax relief equal to 250 per cent of the amount donated.

An approved donation of, for example, $1,000 reduces the donor's chargeable income by $2,500.

For an individual donor, the impact of this depends on his/her chargeable income.

If the donor's chargeable income exceeds $320,000, for which the marginal tax rate is 20 per cent, the net (i.e., after-tax) outlay to the donor is $500.

If the donor's chargeable income is between $30,000 and $40,000, for which the marginal tax rate is 3.5 per cent, the net outlay to the donor is $912.50.

If the donor's chargeable income is less than $20,000, for which the marginal tax rate is zero, the net outlay to the donor is $1,000.

This appears to be an anomaly.

Firstly, a donation is a donation.  The tax relief results in an inverse relationship between the net outlay of a donation and the donor's marginal tax rate.  Why should a donation of any given amount become an outlay that is smaller after tax for a high-income donor than for a low-income donor?

Secondly, this distortion has been magnified as the tax relief was raised over the years.  The tax relief was doubled to 200 per cent of the amount donated in 2002, and to 250 per cent in 2009.  The 250 per cent tax relief, which was applicable for two years initially, was recently extended to 2015.

Thirdly, a donation of any given amount forms a bigger part of the donor's chargeable income and may be a bigger sacrifice, the lower the donor's chargeable income.

The existing tax relief should be replaced by a tax rebate of a fixed percentage of the amount donated.

The Government should consider giving individuals who do not pay income tax a cash amount equal to the tax rebate.  Such individuals will then derive some monetary benefit which they did not enjoy previously, but they will not be getting more benefit from their donations than the wealthy.

In this way, all donors will be treated equally and equitably.

Such change should not discourage donations by the wealthy — if the donations are truly from their hearts.

30 July 2011

Freezing Bus and Rail Fares to Fight Inflation

The recent application by the two public transport operators for a 2.8 per cent upward revision to bus and train fares has met with scathing criticisms by the public.

There are two main areas of complaint.

Firstly, the service is not up to expectations.  I will deal with this in a later post.

Secondly, raising bus and train fares will add to already high inflationary pressures, especially when wages are not keeping up with inflation.  The consumer price index in June was 5.2 per cent higher than that 12 months ago.  CPI inflation is expected to be between 4 and 5 per cent for the whole year.

Earlier this year, many vendors of cooked food were persuaded not to raise their prices to fight inflation.

Large supermarket chains committed not to raise the prices of their housebrands for several months.

At that time, I wrote [link] that it was unfair to expect any business, big or small, not to raise prices of the goods and services that they provide if the cost of their inputs had risen and was continuing to rise because they were subjected to a profit squeeze.

Why have there been no calls to landlords (especially the statutory boards such as JTC and HDB) not to raise rentals, nor to Inland Revenue Authority of Singapore not to raise the annual value of properties (the precursor to higher property tax), nor to Energy Market Authority not to allow electricity tariffs to be raised, nor to CityGas not to raise the price of town gas, nor to the oil companies not to raise the price of petrol or diesel?

The public transport operators have to give their employees wage increases and bonuses.  They have to contend with higher energy costs.  They have to buy new buses and equipment.

It is unfair to deny them an upward fare revision so as not to contribute to more inflationary pressure for commuters.

29 July 2011

A Painful Silver Lining if the US Defaults

In the run-up to the general election in May this year, the ruling People's Action Party and the opposition The Workers' Party traded arguments as to whether Singapore would be better served by having one and only one political party in Parliament.

Members of the public joined in and cited the US political system as an example why a strong opposition might lead to deadlocks.

The US political system is very different from the Singapore political system, and I wrote that it was not a strong opposition that was bad, but the very structure of the US political system [link].

The US's system is a bicameral system, which makes it more difficult to adopt legislation when the Senate and the House of Representatives are controlled by different parties.

Singapore has a unicameral system.  Once a bill is passed by Parliament, it is presented to the President for his assent.  The President must act in accordance with the advice of the Cabinet when exercising his functions under the Constitution or any written law, other than in the performance of certain limited functions.

The US president and his cabinet are not members of Congress.  Neither the president nor the leader of the Senate or the House can compel any Senator or Representative to support the president's policies.  In a parliamentary system, however, the party whip is seldom lifted to allow Members of Parliament the discretion to vote as they wish.

Candidates for US Congress have to raise campaign money, collect signatures to get their names on the ballot, and personally appeal to registered voters of their party in primary elections.  Thus, local issues may be as important as, or more important than, national issues to individual Congressmen.  In many other democracies, the party controls whether to allow candidates to run, and actually puts their names on the ballot.

Significant authority is also vested with the legislatures in each of the constituent states of the US, and each of them can facilitate or impede the implementation of federal programmes.

The fragmented and diverse interests of the members of Congress may explain why it has been so difficult to reach an agreement on raising the US federal debt limit, a simple matter (many countries don't even have a debt limit that they are not permitted to exceed) which has now been inexplicably linked to balancing the budget, reducing spending and increasing taxes.

If no agreement is reached to raise the federal debt limit by 2 August, the US will default.

It is difficult to imagine a country that faces a debt default not because of economic factors nor world events.  Incredibly, it is self-inflicted.  Raising the debt limit does not empower the government to spend more; it only allows the government to borrow what is necessary to ensure that the programmes previously approved by Congress are funded.  It is an unfair tactic to use to curtail such programmes.  It is not the appropriate tool to use.  It is a dangerous and reckless tactic.

The US is in this bizarre situation because its politicians do not have sufficient courage or will to do what is right for the country.  Perhaps, everyone thinks only his proposal is right for the country, and no other proposal will do.  But if everyone sticks to his guns and does not compromise, the country will grind to a halt and trigger a default.

There appear to be three options.  One, a combination of mostly spending cuts and some tax hikes; but Democrats are against spending cuts that will affect the vulnerable (and not every Democrat agrees with President Obama on the cuts) while the Republicans are against tax hikes for the wealthy which they say is bad for the economy.  Two, spending cuts only (which many Democrats do not agree with).  Three, neither spending cuts nor tax hikes, but giving President Obama the authority, and the blame, for raising the debt ceiling.


According to a recent Washington Post-ABC News poll [link], there is considerable agreement among Democrats, Republicans and independents on many of the specifics, contrary to what may be inferred from political posturing by the politicians in Washington.
























Will the US avoid a default?

No sane person wants to see the US defaulting.


But in the worst case scenario if the US does default, its leaders and its people may look at it as just the catalyst for the country to address not only its growing debt but also its political system which is proving to be dysfunctional.  No one, no faction and no party should hold, or should be allowed to hold, the country to ransom — by threatening to destroy the country and the economy, doing to the country what its worst enemies would only dream of doing.

May God bless America.

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This post was previously published on 23 July 2011.

17 July 2011

Clean and Fair Elections in Malaysia

I didn't pay much attention to media reports of Bersih's calling for electoral reform in Malaysia until a few weeks ago, when authorities there detained 30 individuals under section 122 of Penal Code, and accused them of conspiring to overthrow the Government and to revive communist ideologies.

Apparently, reviving communism is tantamount to waging war against the King, a crime for which the punishment is imprisonment for life or a term not exceeding 20 years, and a fine.

Isn't communism effectively dead and buried?

Certainly, many countries are ruled by autocratic regimes that deal harshly with political opposition, but they hardly practise communist philosophy or principles.

China may be governed by a Chinese Communist Party, but its economic philosophy and policies are hardly communist or socialist.

Russia has long given up communism.

Maybe Cuba?

So, communism in Malaysia? Who wants it? Who will support it? Surely not Ms Ambiga Sreenevasan, the former president of the Malaysian Bar Council and leader of Bersih.

Bersih, the Coalition for Clean and Fair Elections, comprises civil society organisations which have come together to campaign for clean and fair elections in Malaysia. It says it is non-partisan, although opposition parties naturally yearn for cleaner and fairer elections.

Bersih's calls for electoral reform include inter alia cleaning up the electoral roll, reforming the postal ballot, using indelible ink, having at least 21 days of campaigning, allowing free and fair access to the media, strengthening public institutions, stopping corruption and stopping dirty politics.

Bersih planned a rally on 9 July 2011 in the heart of Kuala Lumpur.

Perkasa, a Malay rights group, and the youth wing of the ruling UMNO planned rallies of their own on the same day in an attempt to counter Bersih's rally.

After the King intervened, Bersih accepted the Government's offer to hold the rally in a stadium, instead of on the streets.

Then the Government said that Bersih was an illegal entity because it was not registered, and needed a permit from the police to hold its rally in a stadium. In the end, there was no agreement and no compromise, and the street rallies proceeded as planned.

Perhaps, the Government should have let Bersih proceed with its rally in a stadium, with the police standing by to ensure that there was no violence nor unruliness.

The police met Bersih's demonstrators with tear gas and chemical-laced water cannons. About 1,700 of them were arrested.

Malaysian Prime Minister Najib Razak said that the Bersih protesters represented a minority of Malaysians but even more people opposed it. UMNO could have called up one million of its 3 million members to conquer Kuala Lumpur, if it wanted to. He said that he enjoyed the support of most Malaysians.

Mr Najib advised Malaysians to shun street demonstrations, and use the ballot box instead if they were unhappy.

Bersih's objective is electoral reform, a precursor to the next general election.

Why would anyone not want clean and fair elections?

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Notes

1. Malaysia Protest Backers Accused of Communist Plot The Straits Times (Breaking News) (27 Jun 2011).

2. Bersih Rally to Move from Streets to Stadium TODAY (6 Jul 2011).

3. Merdeka Stadium Rejects Application for Bersih Rally TODAY (7 Jul 2011).

4. Police to Bar Rally Organisers from KL TODAY (8 Jul 2011).

5. Najib Slams Bersih TODAY (11 Jul 2011).

6. Najib Calls Malaysians to Shun Street Demonstrations TODAY (16 Jul 2011).

09 July 2011

Space for MPs to Meet Constituents

Housing and Development Board ("HDB") introduced a new rule on 10 June 2011 that allows political parties to rent space on the ground floor of public housing blocks for members of parliament to construct offices for their meet-the-people sessions.

When the space is no longer required, it must be reinstated to the original condition by the members of parliament at their own cost.

Rental of the space is at the concessionary rate of $1.50 per square metre per month, similar to that for non-profit social communal facilities run by voluntary welfare organisations.

It is puzzling why the Government does not provide suitable premises free of charge to members of parliament for them to meet their constituents.  Members of parliament are, after all, individuals elected by the citizens to represent them in parliament.

HDB is Singapore's public housing authority and a statutory board under Ministry of National Development.  About 80 per cent of Singaporeans live in HDB apartments.

04 July 2011

Wasting Ministers' Time

Minister for the Environment and Water Resources Vivian Balakrishnan officiated at the opening of Punggol and Serangoon reservoirs on 3 July 2011.

Deputy Prime Minister Teo Chee Hean was also present.

I am surprised that someone considered it necessary to involve even one cabinet minister in such an event — or non-event, which it really was.  If neither of the ministers had more important or better things to do, perhaps they should have spent their Sunday with their families or friends.

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Notes

1. Two New Reservoirs to Boost Singapore's Water Supply TODAY (4 Jul 2011).

26 June 2011

Why Greece Will Likely Default

Few people wish to see Greece defaulting on its debt obligations.

Greece will probably avoid a default now, but it will likely default eventually.  It is only a matter of time.

When a country has difficulties in meeting its debt obligations, it will typically try to negotiate with its creditors to accept a reduction in the principal amount or in the interest payable and/or a postponement of repayment of principal or payment of interest.

Restructuring the existing debt is not enough to nurse a country back to health because restructuring alone does not generate cash flows needed to service the restructured debt.  So the country devalues its currency in order to stimulate exports and encourage inward tourism and inward capital inflows.

Let's take a look at Greece.

Greece is a member of the European monetary union.  The other members of the European monetary union do not want Greece to default because they are afraid of the consequences to the euro, their banks and their economies.

Together with the IMF, they will try to rescue Greece.  They have to be very careful because restructuring Greece's existing debt may trigger a default.

They will provide financial assistance to allow Greece to meet its immediate debt obligations.

How will Greece meet its debt obligations in the future?

As a member of the European monetary union, Greece does not have its own currency that it can unilaterally devalue.

Worse is that one of the conditions of the financial assistance is that Greece must introduce fiscal austerity measures (increasing taxes and reducing spending) and privatise government-owned enterprises.

Fiscal austerity will bring about hardship to the middle and lower income groups.

Fiscal austerity programmes will likely bring about economic slowdown, further reducing tax collection and Greece's ability to meet its debt obligations.

Privatising government-owned enterprises may result in upfront cash flow to the government, but it will be at the expense of future cash flow.  It may prove to be difficult to find buyers for assets that are located in Greece and are dependent on the Greek economy to generate and maintain a reasonable level of revenue.

Who will suffer?

The Greek people, certainly.  The common people.

The (mainly German and French) banks and (mainly European) private investors which hold Greek government bonds.  If the capital base of these banks is severely diminished, their ability to continue their ordinary business of lending may be impaired.  The economies of the European Union will be affected.

Other banks may stop transacting with the banks that hold, or are believed to hold, significant levels of Greek government bonds, because no one really knows how badly affected the counterparties are.  The domino effect takes over.

If not handled properly, the contagion may spread to the rest of the world.

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Updates

12 July 2011

Dutch finance minister Jan Kees de Jager said that Eurozone finance ministers were open to the possibility of allowing a selective debt default by Greece.

Any proposal that penalises existing investors which do not participate — for example by threatening a hard default or by changing the tax or legal status of the residual bonds — may result in a selective or restricted default.  This in turn may trigger insurance claims on Greek government debt.


21 July 2011

Dutch finance minister Jan Kees de Jager said that neither France nor Germany would prevent Greece from partly defaulting on its debt.

European Central Bank, which had strongly opposed a Greek default, may accept a default.

Member countries of the Euro area announced a rescue package for Greece, comprising €109 billion in official financing and €37 billion from the private sector to roll over maturing debt.


22 July 2011

Fitch Ratings Inc. said that the rescue package package for Greece would put the country in restricted default.


25 July 2011

Moody's Investors Service cut Greece's foreign and local currency bond ratings from Caa1 to Ca, just one notch above what is considered default.

It warned that the rescue package implied a temporary sovereign default.  The likelihood of a distressed debt exchange and a default on Greek government bonds was virtually 100 per cent.

It warned that Greece still faced medium-term solvency challenges and there were significant risks in implementing the required reforms.  From its experience, countries that defaulted often defaulted again.

25 June 2011

Rest Days for Domestic Workers

Singapore should consider legislation that makes employers give their domestic helpers a rest day every week, according to Minister of State for Community Development, Youth and Sports Halimah Yacob.

She was commenting on the new International Labour Organisation convention that was approved last week in Geneva to grant domestic workers greater protection from exploitation.

Singapore was among 63 countries which abstained from voting on the convention.  Ministry of Manpower has said it would sign the treaty only when it was sure it could implement it here, and that it would continue to review the rights and responsibilities of employers and workers.  Under the convention, domestic workers should not be treated differently from other workers.

Let's examine the arguments.

Domestic workers should not be treated differently from other workers.

The very nature of the work of a domestic worker is different from that of other workers.

Domestic workers need to rest and should not be made to work excessive hours that could affect their health and well-being.  Having weekly rest days may help to minimise some issues such as stress and overwork.

In many if not most households, domestic workers are not required to work 24/7 and have several opportunities to rest during the day.  There are of course some errant employers who believe in getting their money's worth, and they want their domestic workers to be continuously working 16 hours or more per day.

If it is not possible to give a domestic worker one rest day per week, she should be compensated in cash.

Most domestic workers are currently employed on the basis of one rest day per month.  If it becomes mandatory to grant them one rest day per week, does this mean that their remuneration will be reduced accordingly?  If their remuneration remains the same, it means that those domestic workers who do not get weekly rest days will get a salary increase of almost $100 per month.

If one rest day per week becomes mandatory, it becomes the norm.  Then, it will be difficult for employers to find any domestic worker who will be prepared to forgo the weekly rest day even though she will be compensated for it.  Even if a domestic worker agrees contractually to forgo the weekly rest day and be compensated for it, there is a strong likelihood that she may change her mind during the term of her two-year contract, leading to friction between the employer and the domestic worker.

The rest day need not be on a Sunday; employers can choose a day that suits their routine.  Household work is not so complex that it cannot be organised to enable domestic workers to take a day off every week.

This statement is incomprehensible.

For almost all employers, the issue is not whether the rest day falls on Sunday.  If an employer of a domestic worker works five days or five and a half days a week, he/she will have to take over the domestic worker's work on her rest day.  This is not an issue if the main duty of the domestic worker is to look after his/her young children because the employers (the children's parents) can and should spend time with their children.  Neither is it an issue if the main duty of the domestic worker is to attend to housework inasmuch as most types of housework may be put on hold for one day in a week.  But what if the domestic worker is employed primarily to care for the elderly, especially if they are bedridden?

It is only logical that most domestic workers want to have their rest days on Sundays.  It is rather pointless for a domestic worker to have a rest day if her domestic worker friends do not also have rest days on the same day of the week.

Employers can consider hiring part-time help on their maids' rest days.

There are about 200,000 domestic workers in Singapore.  According to a recent survey, 25 per cent of them care for the elderly.  If these domestic workers are given weekly rest days, about 50,000 individuals are required to provide part-time help on the rest days of these domestic workers, especially if most if not almost all domestic workers want to rest on the same day of the week i.e., Sundays.  To what extent is such part-time help available?  What will these part-timers be doing during the rest of the week?

If weekly rest days become mandatory, many families may find it impossible or impractical to have their bedridden elderly parents or grandparents live with them.  Does the Government plan to set up more nursing homes?

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Notes

1. Consider Law to Give Maids a Day Off Every Week: Halimah The Straits Times (20 Jun 2011).

08 June 2011

Flood Alert System and Lessons for Nuclear Power Preparedness

Tanglin Mall and St Regis Residences, both located along Orchard Road, were flooded following a short period of intense rain on 5 June 2011.

As part of its flood warning system, Public Utilities Board has sensors installed in drains and canals.  The sensors monitor the water level every two minutes when it rains, and every ten minutes during dry conditions.  When the water level reaches the 75 per cent mark (which indicates moderate flood risk) or 90 per cent mark (which indicates a high flood risk), the sensors send SMS alerts to the owners of the buildings in areas prone to flooding.

It appears that intense rain on 5 June caused the water level to rise so fast that it bypassed the trigger points of 75 per cent and 90 per cent, according to PUB.  As a result, the SMS alerts were not sent.

It is not clear why the system was not designed to trigger an SMS alert when the water level exceeds the 75 per cent mark or the 90 per cent mark at the time of measurement or monitoring.  For example, what triggers the alert at the 75 per cent mark should be the water level being at 75 per cent or higher (or water level not less than 75 per cent, which is the same thing) at the time of measurement or monitoring.

PUB has now modified the system so that it will send SMS alerts if the water level rises beyond the 100 per cent mark.

It is not clear why the system was not originally designed to trigger another SMS alert when the water level reaches or exceeds the 100 per cent mark, which is when water overflows from the drain or the canal.

PUB will also look into reducing the two-minute interval for monitoring the water level when it rains.  The two-minute interval was based on past records (presumably of the rate at which the water level rose).  What happened on 5 June was that the water level was rising about three to four times as fast as that in its worst-case scenario, according to PUB.  Ideally, the interval for monitoring the water level should be dynamic, shortening as the water level rises.

PUB should also ensure that the sensors are able to trigger SMS alerts not only when the water level has reached any predetermined mark but also (more importantly) when the water level has risen past any predetermined mark since the last time the water level was measured or monitored.  Otherwise, whether the marks are set at 75 per cent, 90 per cent or 100 per cent may not make much difference to the efficacy of the SMS alert system.

The flood was distressing and painful for everyone affected — the occupants of the shop space, the building owners and the insurers.

Now, suppose it was not a flood, but a nuclear accident such as that at Fukushima Daiichi.

I am convinced that Singapore should never have a nuclear power plant.

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Notes

1. Public Utilities Board ("PUB") is Singapore's national water agency under Ministry of the Environment and Water Resources.

2. PUB Tweaks Flood Alert System TODAY (8 Jun 2011).

07 June 2011

Singapore as a Global Gaming Superpower

With the opening of two casinos in Singapore last year, the country has emerged as Asia's hottest new gaming destination and Asia has cemented its place as a major betting market.

In barely one year, the two casinos collected gaming revenue of US$5.1 billion in 2010, and are forecast to collect US$6.4 billion this year.  This may result in Singapore surpassing Las Vegas, for which the gaming revenue has been projected at US$6.2 billion this year.

Singapore has become Asia's second global gaming superpower after Macau.

It is understandable if Singaporeans are pleased or proud of their nation's status as a global financial centre, or a leading manufacturer of hard disk drives (some years ago), or a reputable manufacturer of deep sea semi-submersible drilling platforms etc.

But, a global gaming superpower?

Is it an achievement?

Gaming revenues, after all, are the net amounts of money that casino patrons lose to the casino operators.

Apart from generating some tax revenue, creating jobs as croupiers (which may or may not be filled by citizens) and giving some business to taxi drivers and food and beverage outlets, it's not clear how casinos help the country to progress and upgrade.

31 May 2011

Singapore Should Never Have a Nuclear Power Plant - Part II

Shortly after the nuclear accident at Fukushima Daiichi, I wrote that Singapore should never have a nuclear power plant [link].

The main reason is that Singapore is too small.  In the event of a nuclear accident, there is nowhere in Singapore that is far away enough from the nuclear plant for us to be safe from radioactive fallout.

The mainstream media carried assurances from "experts" that nuclear power was safe and Fukushima Daiichi was an exception.  As one apologist argued: if an ageing nuclear plant, incompetently managed and with obsolete safeguards, is hit by one of the worst earthquakes in recent history followed by a terrible tsunami, yet hardly anybody is killed, then we must conclude that nuclear power has a lot to be said for it.

In early April, the Singapore Government announced that it would proceed with its pre-feasibility study on nuclear energy.  Senior Minister of State for Trade and Industry S Iswaran assured Parliament that Singapore would still be a long way from making any decisions on nuclear energy even after the study was completed.

On 25 May, the Swiss government recommended to its parliament that the country's five nuclear power plants should not be replaced as they age, leaving them to be phased out by 2034.

On 30 May, Germany's coalition government agreed to shut down all of the country's nuclear power plants by 2022.  Germany will be the first major industrialised nation in the last quarter century to announce plans to go nuclear-free.

Germany currently obtains 23 per cent of its energy from nuclear power.  It will have to invest at least €150 billion in developing alternative energy sources.  It may depend more on fossil fuels, which are more expensive and more polluting.  Either way, electricity prices may rise.

Unlike Fukushima, Germany does not suffer from earthquakes nor tsunamis.

Not unexpectedly, German Chancellor Angela Merkel's decision has been quickly branded as a cynical exercise in realpolitik, a capitulation to irrationalism, and one that lacks scientific and economic sense.

It is a courageous decision to do what is good for the country and the people.  Cheaper and more reliable electricity is not everything.

No community can afford a nuclear accident.  Especially a country as physically small as Singapore.

25 May 2011

Reviewing Ministerial Remuneration

On 21 May 2011, Prime Minister Lee Hsien Loong announced the setting up of a committee to review the salaries of cabinet ministers, other political appointment holders and members of parliament.

He said that while the country would always need committed and capable ministers, politics was not a job or a career promotion.  It was a calling to serve the larger good of Singapore.  As such, their salaries must reflect the values and ethos of public service.

Only earlier this month just days before General Election 2011, then-Senior Minister Goh Chok Tong said that the majority of the population were not concerned about the high ministerial salaries; by and large, the people understood.  Prime Minister Lee said that they were necessary for an honest and sound system which would enable Singapore to have the best team in the public sector.  It had delivered a Government which had served Singapore competently and well.

On 7 May 2011, the ruling People's Action Party secured the lowest share of the valid vote in a general election since Singapore's independence.

History of ministerial remuneration
In October 1994, a White Paper on Competitive Salaries for Competent and Honest Government was endorsed by Parliament.

The salary of an entry level cabinet minister, or Staff Grade 1 (MR4), was benchmarked at two-thirds the average principal income of the top four earners in six professions: banking, accountancy, engineering, law, managing local manufacturing companies and managing multinational corporations.  The one-third discount was meant to be a "visible demonstration of the sacrifice" entailed in becoming a cabinet minister.

The salary of a cabinet minister holding a higher appointment was set by using a predetermined ratio to the MR4 benchmark.

In 2000, the MR4 benchmark was changed to two-thirds of the median income of the top eight earners in six professions, from two-thirds of the average income of the top four earners previously.  Also, only 50 per cent of the stock options awarded would be taken into account in calculating the benchmark.

When Parliament debated the matter of ministerial remuneration at some length in April 2007, the ruling People's Action Party's members of parliament robustly defended the MR4 benchmark.  It may be instructive to revisit the debate [9 April], [10 April] and [11 April].

Why is there a need now to review how much cabinet ministers should be paid?

The results
The formula produced at least two anomalous results.

Firstly, Singapore's cabinet ministers, even entry-level ministers, earn several times as much as any of the heads of government of any of the OECD countries.

Secondly, Singapore's cabinet ministers, even entry-level ministers, earn $2 million to $3 million or more a year.  The median income of residents from full-time employment in June 2010 was $2,710 per month.

Such remuneration was paid from public funds, and determined by the cabinet ministers themselves.

Benchmarking against the best
The MR4 benchmark uses the median income of the top eight earners in six professions every year.  It is unlikely that any individual will consistently rank among the top eight earners in his profession every year.  The company that any specific individual works in may underperform in any one year, or the individual himself may underperform.  Yet the MR4 benchmark assumes that the cabinet ministers will always rank among the highest earners year after year.

Economy
A fifth of the cabinet ministers’ annual salaries depend on a GDP bonus of between zero months, if the economy grows by 2 per cent or less, and eight months, if it expands by 10 per cent or more.  (This statement by Minister in charge of the Civil Service Teo Chee Hean in 2007 is not clear.  Since the GDP bonus is variable, will the GDP bonus account for one-fifth of the ministers' salaries when the GDP bonus is zero or eight months?)

The performance of the Singapore economy is the result of many factors and the contributions of many people, not just the contributions of the cabinet ministers and other political appointment holders.

Survival of the organisation
An incumbent cabinet minister loses his job if he underperforms, he loses his parliamary seat or his party loses a general election or a vote of no confidence in parliament.  A person in the private sector loses his job if he underperforms or his organisation does not survive.

Pension
The concept of pension hardly exists in the private sector.

A cabinet minister or other political appointment holder is entitled to receive his pension upon reaching the age of 55 years.  Moreover, he is entitled to receive his pension in addition to his regular remuneration if he is still holding the political appointment.  Finally, he may exercise his option to receive a commuted pension gratuity instead of his pension.

The MR4 benchmark does not take into account the entitlement of a cabinet minister or other political appointment holder to receive his pension.

Member of parliament allowance
It seems that a cabinet minister or other political appointment holder also receives the member of parliament allowance.

The party whip, leader of the house and deputy leader of the house enjoy allowances for the additional duties they undertake in addition to being members of parliament.

Other allowance
It is not clear what other allowance, if any, a cabinet minster or other political appointment holder receives.

Cabinet ministers, other political appointment holders and other members of parliament in some countries are entitled to receive certain allowances and/or subsidies such as in relation to maintaining a second home.  However, their situation is different inasmuch as the constituencies which they represent may be located far away from the capital city where the parliament is located.

Civil service
The parliamentary debates in 2007 and 2011 on ministerial salary revisions started with, and was focused on justifying, the revisions of civil servants' salaries.

There is no reason for ministerial salaries to be linked to the salaries of senior civil servants, or vice versa.

Review
The review of the remuneration of cabinet ministers and other political appointment holders appears to serve little or no purpose.

The question facing Prime Minister Lee is a political one.  What remuneration is acceptable to the public?  What remuneration is not too great a sacrifice for public office, now and in the future?

Despite what the prime ministers, other holders of political appointments and other People's Action Party members of parliament have said in support of ministerial salaries since 1994, it is difficult to justify ministerial salaries that are several multiples of the salaries of heads of government elsewhere, and they probably know that.

The use of any other criteria or benchmark is so subjective as to make it politically charged and almost indefensible.

One possible outcome of the review is that the committee will recommend a level of ministerial remuneration that is lower than current levels but higher than what other heads of government receive and higher than what is politically acceptable, but Prime Minister Lee will end up sensibly choosing a level that is politically acceptable.

13 May 2011

Reflections on General Election 2011

Sentiment
The current generation is footloose, trying its luck, looking for fun and games, according to the ruling People's Action Party ("PAP").

A more realistic assessment of the sentiment on the ground was given by the PAP candidates who contested in Aljunied group representation constituency ("GRC"), when reflecting on their loss: there was deep resentment, unhappiness, anger, and pent-up frustrations against the PAP government, and a growing cry from the heart.

Accountability
Minister Mentor Lee Kuan Yew warned the electorate of Aljunied GRC that if they voted in The Workers' Party, they would have five years to live and repent.

In contrast, Prime Minister Lee Hsien Loong reminded PAP candidates that they were servants of the people, not their masters.

A candidate, together with his party, who is elected to parliament is accountable to the electorate; the electorate is never accountable to the candidate or his party.

Track record
For the purpose of a general election, the relevant track record of any party is its track record since the most recent general election.  For the purpose of the 2011 general election, PAP's track record is not that belonging to the era that brought the country from third world conditions to first world.  It does not mean that Singaporeans do not value the accomplishments of the first generation of political leaders; instead, this general election is not about those accomplishments.

Senior Minister (immediate past Prime Minister) Goh Chok Tong said that PAP's improved share of the vote in the general election 1997 and 2001 ― the party secured 61.0 per cent of the valid vote in 1991, 65.0 per cent in 1997 and 75.3 per cent in 2001 ― vindicated his policies, many of which are still in effect today.  The results of general election 2001 held in November, when the tragedy of 9/11 World Trade Center was still fresh in the minds of the electorate, should be disregarded as being anomalous.  Otherwise, PAP's smaller 66.6 per cent share of the valid vote in general election 2006 would have to be interpreted as a rejection of its policies.  But whose policies, inasmuch as Mr Lee Hsien Loong took over as prime minister in August 2004?

Group representation constituencies
The politics of GRCs were dealt with in previous posts [link] and [link].

Minister for Foreign Affairs George Yeo, who was contesting in Aljunied GRC, may have been a victim of the GRC system that was created by PAP.

Distinction between government and party
A reader wrote to The Straits Times noting that some individuals were given senior positions in National Trades Union Congress ("NTUC") after they resigned from the civil service prior to contesting as PAP candidates in the general election.  According to NTUC president John de Payva and NTUC secretary-general Lim Swee Say (who is concurrently a Minister in the Prime Minister's Office), NTUC's shared efforts with PAP had enabled the PAP government to grow the economy and strengthen the society.  Was NTUC working with PAP or the government?

As in past general elections, the electorate was told that it must expect PAP to look after PAP constituencies.  It is unclear what a PAP constituency is because PAP has never got, and will not get, 100 per cent of the votes in any constituency.  If PAP (the party) wishes to look after constituencies where the majority of the voters voted for PAP, that is its prerogative.  It is, however, wrong for the PAP government to look after such constituencies ahead of the constituencies on the basis of which party the majority of its people voted for.  An elected government has a moral obligation to look after every citizen and every constituency in the country regardless whether the citizen or the constituency voted for or against the ruling party and regardless whether the citizen resides in a constituency where a majority voted for or against the ruling party.

Upgrading or public refurbishment programmes
Apart from the government's moral obligation to look after every citizen and every constituency in the country, many or most of the upgrading or public refurbishment programmes are funded by public funds, not funds raised from within the respective constituencies.

Many of the programmes serve broader needs of the people and the country, and are not specific to the respective constituencies.  For example, the planning of the mass rapid transit system takes into account population distribution and concentration, not whether or not the majority of citizens in the relevant constituencies voted for or against the ruling party.  The creation of the newest river in Singapore, running along Bishan Park, presumably has something to do with the country's water catchment programme; if it is purely for aesthetics or enjoyment, it is an extravagant expenditure.

Many of the programmes are developed by government agencies such as Urban and Redevelopment Authority, Housing and Development Board, National Environment Agency and Land Transport Authority.

Gamble
Some people described Mr Low Thia Khiang's and Mr Chiam See Tong's move to GRCs away from the single member constituencies ("SMCs") which each of them had held for more than two decades as a gamble.  Both moves were courageous, but neither was a gamble.  They had to do what they did because they believed that it was necessary for their parties to step beyond SMCs to GRCs in order to contribute more to the country.  For a more detailed discussion, see [link].  The Workers' Party retained the SMC previously held by Mr Low and won a GRC.  Singapore People's Party narrowly lost the SMC previously held by Mr Chiam and he lost in the GRC his team contested in.

First world parliament
PAP candidates spent much time and energy debating with The Workers' Party about the latter's vision of a first world parliament and whether Singapore would be better off with one dominant party (i.e., PAP) in parliament rather than a two- or a multi-party system [link].  It was a pointless debate during which many inappropriate examples of malfunctioning two- or multi-party legislatures were cited.  Without a two- or multi-party legislature, PAP itself might not have come to power.

Manufacturing
In his economic manifesto entitled "Creating Jobs and Enterprise in a New Singapore Economy — Ideas for Change" (15 February 2011), Singapore Democratic Party's Tan Jee Say proposed de-emphasising manufacturing and focusing on selected services.  His proposal was questioned by several PAP candidates.  He was even said to be not qualified to put forward the proposal.  Although Mr Tan's arguments are persuasive from a macroeconomic perspective, the difficulty in implementing it is that not everyone can survive in a service oriented economy.  The heated atmosphere of the general election was probably not the right time to introduce a subject which had profound implications for half a million individuals whose livelihoods depend on manufacturing.

Foreign students in Singapore
Surprisingly, this emotive subject was mostly neglected by the opposition parties.

Municipal matters
A general election is not about municipal matters such as parking, street lighting, public bus services etc.  Neither is it about improving the physical infrastructure because some level of improvements to the physical infrastructure are expected; it serves little purpose to grow the sinking fund in a constituency if not to improve the physical infrastructure.

Candidates
Despite the swing in sentiment against the PAP, some opposition parties failed to realise or to acknowledge that some people just would not vote for opposition candidates if they were seen to be not credible, or not sufficiently credible to represent them in parliament.  It might have been better to field fewer but credible candidates.  Faces from the past should not have been fielded, especially if they had failed in the past and had done little for the people in a constituency in the past five years.

The outcome might have been different had the more promising and/or more outstanding candidates in the opposition parties been fielded in the SMCs.  Quality counts, as does emotional connection.

Singapore Democratic Party's Vincent Wijeysingha's participation in a forum on gay issues in the past was brought to the attention of the public by PAP's Vivian Balakrishnan.  A candidate's sexual orientation is irrelevant, but not his agenda.  Nevertheless, it was a sensitive issue.

Candidates should polish up their public image and public speaking skills.  The televised forum on 2 April 2011 is instructive.  Candidates should learn from Minister for Finance Tharman Shanmugaratnam — he sat upright (not leaning on the armrest nor leaning forward), looked straight into the camera (only occasionally at the moderator or the opposition party representatives) and spoke clearly and confidently.  Some of the other participants should have rehearsed their opening and closing comments until their delivery was natural and flawless; there was no excuse for stumbling over their own prepared comments.  Participants also knew in advance not only the points they planned to raise, but also Mr Shanmugaratnam's probable reply and their own response.  Given the significance of the political forum, they should have rehearsed over and over, preferably with role play.  Finally, there was no room for humility nor lack of confidence; if they did not or did not seem to believe what they themselves were saying, they did not deserve to be believed by their audience.

Speakers at rallies should limit their speeches to three or four main points, even though they might have a dozen or two dozen things that they considered important to communicate to their audience.  Attention span is limited.  Introductions and conclusions are essential to reinforce their points.

Opposition parties and their candidates should keep their focus on the key issues, and not allow themselves to be distracted.  What matters in politics is exploiting the other party's weaknesses.

Media
Some people said that the mainstream media (television and newspapers) were more balanced than in previous general elections in their treatment of the opposition parties.  Others (possibly many) perceived the mainstream media to be still less than balanced in their coverage, presentation, reporting, commentary and editorial, and turned to alternative social media, where cynical and vitriolic comments generally critical of the ruling PAP abounded.  The country in general and PAP in particular would have been better served had the mainstream media been balanced and objective.

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This post, originally published on 12 May 2011, was subsequently updated.

05 May 2011

Reflections on Change

Arnold Bennett.  Any change, even a change for the better, is always accompanied by drawbacks and discomforts.

Everett Dirksen.  Life is not a static thing.  The only people who do not change their minds are incompetents in asylums who can’t and those in cemeteries.

John Kenneth Galbraith.  Faced with the choice between changing one’s mind and proving there is no need to do so, almost everyone gets busy on the proof.

Mahatma Gandhi.  You must be the change you want to see.

John Porter.  People underestimate their capacity for change.

Virgil.  They can because they think they can.

Andy Warhol. They always say time changes things, but you actually have to change them yourself.

King Whitney Jr.  Change has a considerable psychological impact on the human mind.  To the fearful it is threatening because it means that things may get worse.  To the hopeful it is encouraging because things may get better.  To the confident it is inspiring because the challenge exists to make things better.

[Unknown].  One definition of insanity is believing that you can keep on doing what you have been doing and get different results.