Monday, December 15, 2008

GDP as a performance barometer.

"'Once you have growth, all problems can be managed." - MM Lee.
"The key is having a good government which will get its policies right, to encourage economic growth" - MM Lee
.
"Yes, if you do that, once you don't have growth all the worms in your system comes out"
- Lucky Tan


For years the PAP govt focussed its policies on economic growth, even as income inequality rose, cost of living escalated and poverty among Singaporeans increased. The MoM stopped releasing its figures on unemployment among Singaporeans and tries to shore up its grand achievements by releasing something called the 'employment rate'. The reality is one quarter of the workforce, 500000 workers, take home less than $1200 per month[Link] as the cost of living rose and living standards fell for a large number of Singaporeans. Professor Stiglitz (Nobel Prize 2001) tells us focussing narrowly on GDP as a measure of performance may not be good for society.

"GDP doesn't tell you what happens to the typical citizen...." - Professor Stiglitz.

16 comments:

Anonymous said...

Hi, maybe u can write abt the report on ERP in today's ST. I'm a Major in pure Mathematics but yet find it perplexing why given 23+% of pple agreeing traffic is smoother now, the ERP is lauded as a success - what about the other 70+%? With 70+% saying travel habits havent changed, one really doesnt surmise habits have indeed changed in page 8 of the ST.

Anonymous said...

interesting news in HK today. the govt will spend more than 20% of its GDP next year, to make sure the economy stays vibrant.

it goes against its long-held tradition of spending according to growth, but the HK govt is prepared to go into major deficit, to make sure HK doesnt suffer as much.

wonder what the Singapore govt is prepared to do - outside of hiding its losses in investments?

Onlooker said...

Summary:-
GDP = Quantitative measure of performance (success in governance) but in reality the quality of the performance had dropped drastically (That why a change is needed).

To anon 8.15pm: ST say The traffic is smoother? LOL the cost of driving have gone up but the traffic is >>>NOT<<< smoother.

Anonymous said...

All that the ERP does is to shift congestion to other roads. The key to the traffic snarl-up short of limiting the vehicle population is to have an efficient public transport system so that people will drive their own vehicles less often.

Sgcynic said...

Hey, my ministerial KPI and bonus is based on GDP. So what do you expect me to focus on? People!?

sgcynic said...

Hi anonymous 8.15 pm,

I reproduce my post in The Online Citizen:

Example of crap from our world class newspaper

Straits Times (Mon, 15 Dec 2008)

Headline: “SPECIAL REPORT: ERP helps cut congestion, drivers agree”

Rationale for headline: “About 26 per cent of drivers polled this year said ERP had reduced traffic compared to 15 per cent last year.”

@#&*@%^*$

On page A8, the chart showed that the responses to the question “Has the increase in ERP reduced traffic?” are

Yes 26.3% (2008) 15.3% (2007)
No 62.7% (2008) 77.3% (2007)
Don’t know 11% (2008) 7.5% (2007)

Our world class paper certainly follows the Pareto Principle. No wonder our 1st division politicians are blind. See only the good stuff.

LOL.

&*(&$@#*($&

Anonymous said...

Mr Tan,

Thks for the Video Link. Will you be commenting on Singapore GNP as a follow up of this article and video?

KB.

LuckySingaporean said...

KB,

I thinking of looking at the real performance of this govt based on a set of matrics that measures the people's wellbeing. Median income, income of lowest 20%, income disparity, increase in housing, healthcare cost and other necessities relative to median income and low income.

Are Singaporeans better off than they were 12-20 years ago?

ArtBoon said...

Wondering if there is anything on the purchasing power of our salary?
House price relative to salary (affordability index) is high, but I wonder how high...

LuckySingaporean said...

Artboon,

There is something called the purchasing price parity. Its like the real buying power of your income. You can be making $6000 a month in Finland and just lead a miserable life because McDonald's meals costs $20-$40 and taxi rides are $100...thats what a friend who went there recently told me.

Maybe the Big Mac can be used as a proxy to this number.

Anonymous said...

The PAP has failed in the following areas due to severely weakened purchasing power of our people compared to before.

1. Public housing
2. Public and private transport
3. Medical care
4. Utility bills
5. To a smaller extent, food.

That is practically everything related to day to day living.

Only the ministers' purchasing power has improved tremendously by tagging to GDP growth and top private sector pay. Any wonder why casinos can be approved?

Anonymous said...

When Singaporeans decide that working like a mule for the rest of their lives is not worth the trouble then major changes is on the cards.
Till then enjoy the ride........

Anonymous said...

Anonymous @ 7:21 PM
It's all about power. When Singaporeans are squeezed for leisure time, money etc. there is little left to ponder. Work as a mule........
Until they reach the pain threshold and decide they are not going to play along it will be more of the same.
Pointless to look at any KPI, metrics, it tells the same story. You're squeezed and will be squeezed some more ..... till you decide enough.
Get me out of here or get them out of here.

ArtBoon said...

I mean whether anyone did an analysis of the purchasing power of our salary relative to other country...

--
Maybe the Big Mac can be used as a proxy to this number.

Anonymous said...

Your friend might be exaggerating.

The cost of a big mac meal in Finland is about 6 EUR (12.3 SGD). Or, at least it was in 2006.

Eating out is traditionally quite expensive in the European countries anyway.

jeflin said...

The GDP has its shortcomings but for now it is still an objective test of how the government has been performing on the macro level.

Looking at the official response to the transport fees, I think they will not entertain other benchmarks, like our purchasing power.