Thursday, December 31, 2009

Latest Reason for Chinese Influx : Maintain China-Singapore ties!

Just when you begin to accept that they are here to make you strive harder, a new reason has emerged to justify the large influx:

"A key sustainer of Singapore- China relationships will continue to be the large influx of Chinese immigrants that come to Singapore to work and stay, MM Lee added"
- AsiaOne News, "Why Singapore will not be squeezed out by rising China" [Link].

I've never heard of one country trying sustain relations with another by importing the other country's people but there are always uniquely Singaporean ways of getting things done.

From my previous post on the same topic:

"Gee, we were told they were here to create jobs for Singaporeans[Link] and we should be thankful. Then we were told they were here because of the low fertility rate. Long time ago we were told they were needed for skills that didn't exist in Singapore. We were also told they are here for jobs Singaporeans did not want. Now we are told they are here because Singaporeans are now too lazy for Singapore Inc."

Why is there such a big influx? Wah...there are so many good reasons.....but pushing up the GDP , cost of living (housing) and driving down wages of Singaporeans to keep costs down are never officially the reasons for having such a large influx...hmm perhaps these are the unintended consequences of the good intentions of a govt that will do only what is beneficial for ordinary Singaporeans?

Tuesday, December 29, 2009

Ideals of the Fajar Generation....

"The recent economy crisis, the recent financial crisis has again exploded the corruption and immorality of the Capitalist system and feel that human beings deserve something better than a system generated by greed and corruption. Now some of you have heard that when you're young, you're idealistic when you're old you're realistic. Now that is the kind of rubbish that is used by those who have lost their ideals and sold their ideals for self-interest. Each should not wither one's ideals or convictions. If anything, it should only consolidate and make it more resolute. If age has anything to do with it, it is only by way of expression and application of those ideals and convictions having the benefit of youthful experiences. And a life without convictions, without idealism is a mere meaningless existence. ...."

- Dr. Lim Hock Siew, speech at the launch of the book, "The Fajar Generation".[Link]

"I thought it would be useful to examine extracts from the alleged seditious article in class but I immediately hit a brick wall. There were no issues of Fajar in the collection of the National Library. The National University of Singapore Library (which inherited the collection of the University of Malaya) has an incomplete set (5 issues short of the total 62; lacking the first 2 issues, numbers 20 and 24 of Volume 1 and number 5 of Volume 2). However, the publication was still under lock and key. Access to it was restricted" - Lim Cheng Tju, A Personal Journey In Search Of Fajar

Seditious? Kept under lock and key? Restricted? Here's a picture of my desk at home this evening:


I own a collection of Fajar which was published in 1954-1961 i.e 50 years ago ...long before I was born. I wonder if I have the only other remaining copies of Fajar in Singapore.

Reading the Fajar gives an alternative view of the history of Singapore especially the key events such as the merger with Malaysia and the formation of Barisan Socialis. The ideals of the Fajar generation are equality, democracy, freedom and justice within a socialist framework. Operation Coldstore (1963) and the banning of Fajar , an organ of USC (University Socialist Club) mark an end to political openness and intensified the climate of fear. Here we are today in the most economically unequal society in the developed world, ruled by an authoritarian govt that over time took away our freedom of speech and the free press, and led by ministers who earn the highest salaries in the world. The ideals of the Fajar generation are still as relevant to our generation as they were 50 years ago.

"The Big Six – Mr Lim, Mr Fong Swee Suan, Mr Woodhull, Mr Dominic Puthucheary, Mr S.T. Bani and Mr Jamit Singh – had stated that while they supported the PAP in the coming by-election, they would not compromise on issues such as detention without trial and freedoms of press, speech, assembly and organisation.
Dr Poh argues that these statements amounted to a ‘request’, not an ‘ultimatum’. But Mr Lee, he says, saw this as a challenge to the PAP leadership and decided to make the split."

- Dr. Poh Soo Kai, Straits Times Interview "Dr. Poh:Why I parted company with PAP", 27 Dec 2009.

Extract from Fajar Editorial, Vol III, Issue 6, Aug 1961:

In 1961, there was still some hope for greater democracy in Singapore as seen by the writings of these university students. They could hardly imagine the events in the coming years that would turn their hopes for democracy into dispair.

Monday, December 28, 2009

Strive harder and harder....

“Over time, Singaporeans have become less hard-driving and hard-striving. This is why it is a good thing that the nation has welcomed so many Chinese immigrants"
- MM Lee, National Geographic, The Singapore Solution, Jan 2010[
Link]
...
" If native Singaporeans are falling behind because "the spurs are not stuck into the hide," that is their problem" - MM Lee.
.
A few months ago, the Straits Times reported that a top civil servant took 5 weeks off from work to attend expensive cooking lessons in France. How many of you are able to take 5 weeks off from work? Yes, the rest of us have to strive harder. In 2007, a blogger wrote about the new employment terms[Link] given out to her mother, an elderly cleaner:
.
1. The pay is reduced to S$500
2. Now it has to be a 5.5 days working week
3. There will be a cut in manpower as there should not be more than 3 people working at an area, regardless how large the area space
4. No annual leave and sick leave for the first year.
.
I've never heard PAP MPs who stood up to defend their fellow elite (aka French cook) talk about the pay of some Singaporeans being too low or about the lack of protection for Singapore employees. During the debate about ministers', PAP men stood up to talk about why the most expensive cabinet and (probably the most expensive) top civil servants were underpaid and have made a great sacrifice and deserve more remuneration...the same MPs have never spoken about ordinary Singaporean workers deserving a better income. While there is great dismay and shock among netizens over what MM Lee has said, such beliefs are prevalent among the elites within this elitist system they have created - no amount is enough for the people on top and the people at the bottom deserve to struggle. To worsen their plight, they import "hungry" workers from impoverished 3rd world country who are paid $200 at home to come here and depress the income of our low income workers further - that these Singaporeans sink further below the poverty line is no concern to them....the main concern of our current PM when was that his 'most expensive ministers in the world' were paid too little - raising their pay was among the first things he did when he took office.
.
If we continue with this system, where will you and your family be 10 or 20 years from now?

Friday, December 25, 2009

Merry Christmas...May your dreams come true!


I chose this song by Susan Boyle to put on my blog for Christmas for a few reasons. Less than 1 year ago, Susan Boyle was an unknown church volunteer until she picked up the courage to appear on Britain's Got Talent. Frumpy and awkward, the audience instantly wrote her off until she sang and the rest is entertainment & Internet history. It is only 9 months since her first appearance on BGT but her debut album, released in Nov 2009 has reached No. 1 throughout the world and is the best selling album of 2009. Susan Boyle is the best example of how the Internet can transform and change lives to make dreams come true. For years Singaporeans have been dreaming of greater equality, freedom and a better life for their children but positive changes has been hindered by those in power who dominate this country using propaganda. The Internet has brought about change in many countries including nearby Malaysia. I hope in 2010 the dreams of ordinary Singaporeans come true. Have a Merry Christmas!

Thursday, December 24, 2009

New reason for FTs : S'poreans have become less hard-driving and hard-striving

“Over time, Singaporeans have become less hard-driving and hard-striving. This is why it is a good thing that the nation has welcomed so many Chinese immigrants"
- MM Lee, National Geographic, The Singapore Solution, Jan 2010[Link]
.
Gee, we were told they were here to create jobs for Singaporeans[Link] and we should be thankful. Then we were told they were here because of the low fertility rate. Long time ago we were told they were needed for skills that didn't exist in Singapore. We were also told they are here for jobs Singaporeans did not want.
.
Now we are told they are here because Singaporeans are now too lazy for Singapore Inc. Yes, years of good life and pampering by the PAP govt has turned us into softies unable to compete in this globalised economy. Strange isn't it? If these hardworking and hard striving Chinese immigrants are so productive why has our productivity fallen as their numbers rise?
.
To the elitist PAP govt, the ordinary Singaporean is never good enough. The 70 yr old who has to clean tables at the Bedok Hawker Center for a living does not strive hard enough. The mother with 2 disabled kids did not strive hard enough to look for a job to support her family. The Singapore workforce ranked no. 1 for over a decade was not hard driving enough for the PAP. Only people who does any real work in Singapore is the PAP govt that is why their ministers deserve to make in one day what some of the workers earn in a year.
.
" If native Singaporeans are falling behind because "the spurs are not stuck into the hide," that is their problem" - MM Lee
.
This explains why the blame is always put on Singaporeans for almost every problem faced by our society. You find it hard to afford a HDB flat - that is because you didn't strive hard enough. You struggle to raise your family, pay the ever-increasing bills for electricity & transport and find it hard to cope with the unstable job market - you didn't strive hard enough.
You recall what Wee Shu Min once said:
.
"i should think not. dear derek is one of many wretched, undermotivated, overassuming leeches in our country, and in this world. one of those who would prefer to be unemployed and wax lyrical about how his myriad talents are being abandoned for the foreigner's, instead of earning a decent, stable living as a sales assistant. it's not even about being a road sweeper. these shitbags don't want anything without "manager" and a name card.
please, get out of my elite uncaring face."
.
....and her father is president of the defense business section ST Engineering which is fed mainly by our defense budget i.e. taxpayer's money. The PAP elites likes to talk about the ordinary Singaporeans not working hard enough and not being able to compete. However, the PAP itself shuns competition preferring to tweak the laws to retain their monopolistic powers. The PAP men like to work in state own monopolies for ridiculously high salaries and from their ivory towers command the ordinary Singaporean to be cheaper, better and faster. We take the overcrowded buses and MRT so that their transport companies can make money, we live in small overpriced public housing (the most expensive in the world), we pay the 2nd highest electricity tariffs in the world and we pay the highest salaries in the world for those PAP ministers...if there is one reason Singapore is not competitive it is because there are leeches sucking the blood of ordinary Singaporeans.

Andy Xie : China's property bubble will burst...

Most of China's massive stimulus package didn't go into investing in factories because its manufacturing sector suffered from overcapacity. In a video I showed several weeks ago, a large chunk of this money went into real estate speculation both residential and commercial.


------------------------------
China Asset Bubbles Will Burst on Inflation, Xie Says (Update2)
By Shiyin Chen
Dec. 18 (Bloomberg) --

China’s property and stock markets are a “bubble” that will burst when inflation accelerates in 2011, former Morgan Stanley chief Asian economist Andy Xie said.

“China’s asset markets are a ponzi scheme,” Xie, now an independent economist based in Shanghai, said in an interview in Hong Kong. “Property is heading for one huge bust that will take a year and a half to unfold.

”The benchmark Shanghai Composite Index tumbled 2.1 percent today, led by a plunge in property shares including China Vanke Co., the biggest developer. A measure of real estate stocks fell 9.3 percent this week, the most since August, on concern the government will step up measures to curb property speculation.

Chinese residential prices climbed last month at the fastest pace since July 2008, spurred by China’s 4 trillion yuan ($586 billion) stimulus package and record lending. The Shanghai Composite has gained 71 percent this year, while the 15 real- estate shares on the MSCI China Index have risen by more than 90 percent on average.“It’s a less glamorous version of the Greenspan bubble and the story will end with inflation,” Xie said, referring to former Federal Reserve Chairman Alan Greenspan, who was once regarded by some observers as the greatest central banker and has seen his legacy criticized since the U.S. subprime-mortgage market collapsed in 2007.

Interest Rates

Economists estimate China’s interest rates may increase 54 basis points in the second half of next year, Bloomberg data show. One basis point is 0.01 percent. Borrowing costs may climb 54 basis points to 81 basis points in the second quarter, according to Gabriel Gondard, Shanghai-based deputy chief investment officer at Fortune SGAM Fund Management Co., which oversees about $7.2 billion in assets.A central bank survey this week showed almost half of Chinese view inflation as excessive, contrasting with government figures showing that consumer prices have fallen for most of this year. On Dec. 11, the government announced that consumer prices climbed 0.6 percent in November from a year earlier, snapping a nine-month run of deflation. Prices will stay largely stable and the chances of significant inflation next year are not big, the nation’s top economic planning agency said Dec. 14.“Inflation is a concern,” Mark Konyn, who helps oversee about $12 billion as chief executive officer in Hong Kong at RCM Asia Pacific Ltd., said in an interview yesterday. “It will be an issue in 2010.”‘

Struggle

In the shorter term, China’s yuan-denominated stocks may “struggle” in the next three to four months before staging a rally that may help the market exceed its 2009 highs as banks resume lending, Xie, who correctly predicted in April 2007 that China’s equities would tumble, told Bloomberg Television.The Shanghai Composite, tracking the larger of China’s two stock exchanges, has fallen 10 percent from this year’s Aug. 4 peak of 3,471.44.Poly Real Estate, China’s second-largest developer, plunged 7.5 percent to 21.88 yuan today, its ninth straight loss. China Vanke dropped 6 percent to 10.59 yuan, the most since Sept. 30.Property stocks slumped this week after the Xinhua News Agency reported the government will target “excessive” growth in property prices in some cities. That follows the cabinet’s statement last week that it will re-impose a sales tax on homes sold within five years, after cutting the period to two years in January. Even after this week’s retreat, the measure of property shares has gained 99 percent, the second-best performer among the gauge’s 10 industry groups.

New Highs?

“Markets are going to struggle in the next three to four months and then afterwards, China’s lending policy may help it along in the second half,” he said. “It’s possible that the A- share market may make a new high in terms relative to the Aug. 4 high this year.”Xie said today that Hong Kong stocks are also about 30 percent “overvalued” and may face a “major correction” in the next four to five months as the market factors in a possible stimulus exit by the Fed. The market may recover in the second half, he predicted.Morgan Stanley, Xie’s former employer, said this week that China’s stock market is headed for a “boom and bust” in 2010 because a rally in the first half may stall as inflation accelerates and the government withdraws some stimulus. The brokerage predicted that the MSCI China Index may rise to 81.7 next year, 29 percent higher than yesterday’s close.To contact the reporter on this story: Shiyin Chen in Singapore at schen37@bloomberg.net
Last Updated: December 18, 2009 03:10 EST

Wednesday, December 23, 2009

Another Suicide due to gambling....

The casinos will only bring more trouble.

In Singapore we hang drug traffickers because, according to the PAP govt, drugs destroy lives. We hang small time runners for trafficking very small amounts of drugs as a deterrent. Misuse of Drugs Act carries a mandatory death sentence for anyone caught trafficking more than 15gm of heroin, 30gm of cocaine or 500gm of cannabis. These death sentences are disproportionate the the crime and the harm caused by these small quantities of drugs. The govt is also completely inconsistent - gambling causes the same or more harm but is tolerated by this govt.

There is no proper education of the public on the harm of gambling. The govt conducts campaigns to encouraging "gambling responsibly". The correct message should be "gambling is bad" or stop gambling because it leads to problem gambling. You don't go and tell people to use drugs responsibly or smoke responsibly. The right message should be don't gamble because gambling can lead problems.
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"For every winner there are hundreds and thousands who keep feeding the kitty and, net, it's a big loser for citizenry" - Warren Buffett on the harm of legalised gambling
.
--------------------------
Dec 22, 2009
Gambling addict hangs himself [Link]
By Khushwant Singh

IN THE suicide note to his wife, father and close friends, Mr Teo Kok Hun, 33, confessed his addiction to football gambling.
The 33-year-old driver, also known as Zhang Guohan, admitted that this was the main reason why he was always short of money.
His favourite football team was Liverpool and he was wearing the club's red jersey when he hanged himself in the bathroom of his four-room flat in Tampines on Oct 26.
His 30-year-old wife, a travel agent, found his body at 7.30pm, when she returned home from work.
State Coroner Victor Yeo, on Tuesday, returned a verdict of suicide.
Strangely, Mr Teo's death came a day after Liverpool defeated archenemy Manchester United, after a series of four successful defeats to other teams.

Humiliation of the poor...

There is this show on Channel 8 called Life Transformers in which they send pretty MediaCorp actresses to visit poor families with disabled children. The contrast is startling - a heavenly creature from the stars comes down to visit a downtrodden struggling family in an act of charity. Plenty of emotional drama and tears...and shock on the faces of these actresses as they find out how hard life is for these poor folks.

In my blog, I sometimes receive comments about how the poor can get help from the govt. The govt controlled newspapers talk highly about the govt's many helping hands approach as if many sources of help will start flowing readily to those in need to ease their pain. Here is a family that obviously needs help and are poor due to no fault of their own. They have 2 kids with disabilities and the father has difficulty finding a job. What does the govt do to them? Humiliate them when they ask for help and threaten to evict them from their rented flat due to arrears. The part about govt help starts at 6 minutes 23 seconds into the video.

Here is the transcript:

"I've applied with the govt before. It always comes to nothing." - Mother

"Where do you go to apply" - Christopher Lee

"The fourth floor of HDB inToa Payoh. I don't understand much English. I only know it is the welfare department. Sometimes, they reject my applications. We go to them because we need help. Otherwise, why bother going to them or subject ourselves to humiliation? I wished I didn't have to go there. They can be so rude. " - Mother

"In what way?" - Actress..

"They keep telling you to work. Its okay if I can find a job. But I may not find one that allows me to look after my children. We go to them only because we need help. They shouldn't say 'Look for a job. Don't always expect help' - Mother

"How did you reply" - Actress

"I kept quiet. Just weep. What else?" - Mother.

So the govt helps these poor folks by telling them to look for a job. Having 2 disabled kids is not a sufficient to qualify for help? That's PAP govt help for you. So if you're slightly better off but is struggling with, say, an autistic child, you can forget about getting any support from this govt.

Monday, December 21, 2009

Hong Kong : A cautionary tale....

I've not blogged much because I was sent overseas for a 'last minute' assignment. After I came back from Europe, I was able to squeeze a short vacation to Hong Kong into my schedule. It has been more than a decade since I last visited Hong Kong. Many years ago, I shared a room in one of the NUS halls with a student from Hong Kong for a year during my undergrad days. He was a friendly sociable feller but had a strange habit. Every night before he went to bed, he would write down in his diary what he spent his money on for that day - it was down to the last cent. I remember one night he couldn't sleep because there was a 50cent shortfall in his wallet. He later recalled that he bought a drink during the day. While most Hong Kongers are not as extreme as my roommate, they have created a society dominated by the pursuit of money - unfettered capitalism that lasted for decades. There is no make believe "equality" in Hong Kong - their school children don't recite a pledge about building a society based on equality and they don't serve NS to defend whole bunch of ideals. Its is probably understood that it is every man for himself, grab as much money as you can because whoever has the most in the end wins the game. The end result is startling and highly visible inequality possible only because they don't conduct democratic elections. My ex-roommate in NUS couldn't stand the thought of returning to Hong Kong. After he got a job in Singapore, he brought his whole family (father, mother and sister) over.

Hong Kong from Victoria Peak looks like a great economic success.
Yes, you see skyscrapers, luxury condominiums and all the superficial exterior signs of wealth. However, you have to examine the Hong Kong society more closely to see the stratifications - the high concentration of opportunities and wealth in a handful of people. The rich live in hilltop villas and poor families who live on boats because cannot apartments. If you're really poor, you end up in a cage[Link].


Buildings the height of Duxton are commonplace in Hong Kong. It is not a good sign that HDB built the Pinnacle@Duxton because it means our housing prices have gone up enough to overcome the high cost of constructing such residential 'skyscrapers'. Real estate price escalation benefits those with the most assets far more than the average families who have only one property and cannot monetise it. Escalating real estate prices in Hong Kong created a handful billionaire property developers and hundreds of thousands of families that cannot afford a decent home - worsening the inequality. This is where we will end up if we leave housing to the free market as the population density rises - you end up creating more poverty than you do wealth.

After the handover to China, the Hong Kong people became aware of the importance of democracy and rights. In 2003 when the Chinese govt tried to implement anti-sedition laws similar to those in Singapore, close to half a million people took to the streets[Link]. When the govt tried to impose GST, they again took to the streets to prevent it[Link] - their biggest worry is that such regressive taxation will further burden the poor and worsen the income gap. Upholding democracy in a territory controlled by China is risky because there is no telling what the Chinese govt will do and when they will start acting against who stand up for freedom and justice. However, individuals like Jimmy Lai[Link] and Martin Lee are willing to risk everything including their lives[Link] to bring change to Hong Kong.

"I think Hong Kong's freedoms are under threat all the time,"

-Margaret Ng, a pro-democracy legislator

They know if they do not guard their freedom and rights fiercely, the pro-Beijing govt will just slip in legislation that will take them away. Constant vigilance is necessary because government control of the media is growing through patronage, financing and the rewarding of pro-Beijing behaviour. When Jimmy Lai's paper became critical of Beijing, companies quickly withdraw their advertisements[Link] out of fear of offending China. The Hong Kong people will have direct elections in 2017[Link] if Beijing sticks to its promise. The reason they don't want it held sooner is the pro-Beijing lawmakers will lose badly given the widespread dissatisfaction with the govt.

One thing I didn't see in Hong Kong was aged cleaners like those we have in Singapore. I found most of these old folks reading newspapers in tim sum restaurants or at McDonalds. They probably receive enough to live on under a comprehensive social safety net put in place by the govt.

The Hong Kong story provides a lesson for all of us. Today a large segment of the population(18%) lives in poverty[Link]. It is no coincidence that greatest income gap in the developed world appears in Hong Kong - the only place in the developed world where there are no direct elections[Link]. The 2nd highest income gap in the developed world is found in a country where the rights of people to protest and speak in public is limited and the media is controlled by the govt. A combination of unbridled capitalism and lack of democracy resulted an unequal society in which there is widespread discontent.

Thursday, December 17, 2009

The Challenger Disaster....

A few weeks ago, I saw a documentary on the Challenger disaster. The disaster was not an unavoidable accident - far from it. Prior to the launch, engineers from the company making the 'O' rings highlighted there would be serious problems because they were not made for the low temperatures at the time of the launch. One engineer even screamed at the management and begged them not to go ahead. He was overruled and silenced because the management wanted to meet the launch schedule. The heroic engineer in the NASA story who fought his management never forgave himself for not fighting harder to prevent the deaths of the astronauts.

More than a decade ago, a bespectacled NUS lecturer warned of rising poverty and the risk of a ballooning income gap. PAP leaders accused him of engaging in the "politics of jealous", he was later bankrupted and jailed. His name is Chee Soon Juan and today our income gap is the highest in the developed world and we are now talking about an emerging ultra-underclass among us.

Tuesday, December 15, 2009

Take the coming elections seriously....

In response to my previous posting, someone posted a comment giving 50+ reasons why one should not vote for the PAP in the coming elections. While you may agree or disagree with what Alex Tan has posted on the Internet, you have to applaud his courage for speaking up. Many Singapore may not share the same level of frustrustion with the PAP govt but there is a growing discontent with govt policies and a fairly widespread recognition of a need for change. In recent months, economists from various public and private institutions have spoken up on the negative impact of the large influx of imported labor on Singaporeans. What you should be concerned about is not just the foreign 'talent' policy itself but its deceptive implementation. When it was started more than a decade ago, the govt said that it's aim is to bring in top talent - skills that does not exist in Singapore. When the numbers rose, the PAP govt said that they were here to create jobs for Singaporeans. They have for years denied the negative impact on Singaporeans such as the widening income gap, structural unemployment and rising cost of living. As the numbers rose other reasons were invented such as low fertility among Singaporeans, I have explained that this is untrue as the workforce today was born roughly 30 years ago when our fertility rate was 3.0 and the PAP govt was trying to lower it with the 2 child policy. The real reason is very simple - the PAP govt prioritized GDP growth above other things and opened the floodgates to feed the industries dependent on low cost labor and to keep labor cost down in effect repressing the income of a large segment of the population....and they kept this going for years as many Singaporeans suffered - their interests traded away for those of businesses such as GLCs closely linked to PAP.

In the last elections, some Singaporeans were hopeful of positive changes given a change of PM and what was mistaken for his recognition of a need for change - Remaking of Singapore committe etc. Singaporeans should have taken the elections more seriously as the PAP govt tried to win not by discussing policies or the way ahead for Singapore but by promising an outlandish sum of money for estate upgrading if elected. They refused to discuss policy initiatives such as means testing during the elections. After the elections, the first acts of the newly elected PM were to up the salary of his cabinet and the GST to cut corporate tax and taxes of high income earners. All hopes for positive changes for Singaporeans were dashed as the PM showed that he was there to preserve the status quo. The increase in minister's pay was a step to preserve PAP's power as the millions paid out for ministers were no longer sufficient to attract people from their own establishment of GLCs, civil service and uniformed service. The incomes over the years were raised to ridiculous levels creating a oversized sense of entitlement of the PAP-linked elites.- the result of years of elitism practiced in the name of meritocracy. ....the same system that saw the income of the bottom 20% of Singapore household sinking to below $1200 per month - some get less for their hard labor in one year than what President Nathan get for shaking hands and smiling in one day. Something has gone very wrong and it is not the PAP's interest to fix it.

I urge all Singaporeans to take the coming elections seriously. Think about the issues clearly and rationally. Do not allow your emotions to be manipulated by propaganda. Spend time to understand the issues surrounding Singapore and its future. Look up the best available ideas and seriously think about how you want this country to be run. Take the effort to understand the plight of your fellow Singaporeans - not just of your own family. We cannot afford to remain apathetic, fearful, self-centered and quiet because the consequences will become harder and harder to accept.

Sunday, December 13, 2009

Alex Tan barred by YPAP...

I guess its their way or the highway - Alex refused to abide by the "rules". Alex Tan, 22-yr old engineer, has been barred from YPAP's Facebook. I haven't gone through most of what he wrote but read his face to face encounter with Sam Tan accusing the PAP govt of being the cause of apathy among the young[Link]. One participant even asked him to leave Singapore if he was that unhappy with the PAP govt. Gee.....Alex Tan should have realised that when the YPAP members meet their leaders the rule is they have to balance any criticism with a whole truck load of praise. You're not suppose to embarrass your great leaders in front of a live audience by directly assigning blame to their actions. However, what Alex Tan said about apathy was rather mild, as least according to what was reported in the papers:

"He pointed his finger especially at the PAP's dominance and the lack of press freedom. The 22-year-old also said the PAP may feel it is helping the people but the people feel disadvantaged by its policies, from foreign talent to national service." - Straits Times Report

Lets put it this way. Apathy wasn't widespread when the British was ruling us otherwise how do you organised people to get them thrown out? The reason for this apathy. in addition to what Alex said about press freedom. is the harsh treatment of people who stood out for the rights of the people such as detention for decades without trial and bankruptcy. Seeing what has happened from the 70s right up to the 80s what do you think parents tell their children..."mind your business, never criticise the govt and steer clear of political issues". The widespread fear of people growing up during that time is very real and this fear is still prevalent today.

Alex Tan is not apathetic. If the PAP and the media it controls makes an example of him by smearing his character, the rest of us will probably stay anonymous, keep quiet and mind our own business.

At least Alex put up a fight against the PAP ideas and their rules. Way to go Alex Tan.
-----------------

Young PAP bars user from its Facebook page Youth wing blocks 22-year-old for starting flame war.
-ST -->
Rachel Chang
Sun, Dec 13, 2009The Straits Times

The youth wing of the People's Action Party has blocked a 22-year-old project engineer from its Facebook recruitment page.
It has also deleted his posts after a war of words between the two sides last month.
Mr Alex Tan has been banned from the page until he agrees to 'abide by the rules', according to a message sent to him on Nov 29 by the administrators, who are members of the Young PAP (YP).

Friday, December 11, 2009

MM Lee advises Japan to import foreign workers.

"MM says Japan should study how Singapore turned to foreign workers to boost its economy"-My Paper

Japan has a very backward policy towards foreign workers. The number of foreign workers is less than 0.5% of the total population[Link]. The number of foreign workers is about 10% among OECD countries[Link]. The Japanese population at the current fertility rate will decline by 30% by 2050. The Japanese govt is taking measures to encourage Japanese couples to have more children to reverse this trend. Suppose the Japanese take MM Lee's advice to learn from Singapore and import foreign workers by the millions to keep the economy growing. In a couple of decades, the Japanese will be a minority in their own country like Singaporeans will be within a decade. So they give up a unique precious culture, a closely knit society evolved over centuries and become a minority in their own country just for one more decade of economic growth. Economic growth? The Japanese have been there and done that. The population won't decline forever and after a while, the decline will reverse when it's cities become less overcrowded. To aim for "perma-growth" - GDP growth prioritised above everything else by packing more and more people on a limited piece of land is clearly unsustainable.

The Japanese people are already very concerned with the M-shaped income distribution [Link]resulting from a widening income gap (no where near Singapore's). The Japanese are a highly egalitarian society[Link] - they will resist any move that will cause their fellow Japanese to sink further below the poverty line. Importing a large number of cheap foreign workers will repress the income of the poorest Japanese further and this will never be acceptable to the Japanese.

MM Lee also advised the Japanese to abandon its political system which is still based on seniority and learn from China, which requires its political leaders to step down when they turn 65[Link]. Hmmm....how old is MM Lee?...Quite an amazing piece of advice even by his standard.

-----------------------------------------
Japan faces tough choice, says MM

MM says Japan should study how Singapore turned to foreign workers to boost its economy. -
Dawn Tay
Fri, Dec 11, 2009 my paper


JAPAN, facing economic and social problems partly due to its ageing population, could take a leaf out of Singapore's book, Minister Mentor Lee Kuan Yew said yesterday.
It could study how Singapore turned to foreign workers to boost its economy, he said.
He was asked how Japan could break its cultural and economic barriers in integrating foreigners at a dialogue to mark the 40th anniversary of the Japanese Chamber of Commerce & Industry Singapore.


He said: "Japan faces a difficult choice here. If it continues its policy, it will have an ageing population which does not consume much - old people do not change cars or televisions every year. One of the reasons why the Japanese economy is not bouncing back, despite stimulus packages, is because the consumer market is down."


Japan has to consider letting the younger generation take up political and business leadership earlier, and to embrace women as part of its workforce.

Thursday, December 10, 2009

Falling productivity : Need to wean off Foreign Labor...

Productivity has fallen by 6 straight quarters from the last quarter of 2007. In the 1st quarter of 2009, it fell a whopping 14.7 percent.

"One is the slowdown in investment in innovation and productivity measures. When the economy grows very rapidly, companies have alot of opportunities to benefit from the growth and the expansion of the economy. So the focus on productivity may be lacking behind. So it is important to refocus attention of companies on productivity growth. There are many measures we can put in place to encourage enterprises to invest in innovation, to invest in research, to invest in benchmarking so that we can raise the overall productivity effort in our economy."- Manpower Minister Gan Kim Yong[Link]
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Minister Gan blames it on the economic growth and worker's training. But our productivity has been falling during the economic slump while that of other developed countries like US has been rising[Link]. In manufacturing and hotels and restaurants in particular, productivity has been on the decline since 2006. This is about the same time foreign workers started entering Singapore in larger numbers[Link].

"One reason for the lower productivity may be the large influx of foreign workers in recent years. With more workers available, each worker doesn't have to work as hard."
-Singapore Economist[Link]

Businesses want foreign workers mainly because they are cheaper. You can hire 1.5-2 foreign workers instead of a Singaporean. It is easier for managers to get more workers to do the same job rather than train and motivate fewer workers to work more efficiently. Business will always clamor for cheaper labor rather than invest in training, automation and innovation. There will always be sources of cheap labor because the cost of living is so much lower in developing countries. This a vicious cycle as import more foreign workers, these businesses depend on cheap labor will profit, grow and want more foreign workers. These business compete for limited resources like office and industrial space with business with higher levels of automation that hire highly skilled (hence highly paid) labor. The more foreign workers we import to generate growth in these industries, the more foreign workers we will need to bring in the future to maintain our GDP. In 2000, there were about 600,000 foreign workers in Singapore, constituting 27% of the total work force. Today it is 36% of the workforce or 1 million. But the demand for foreign workers keeps increasing [See report below]. The PAP govt took the easy way to expand the economy aiming for high GDP growth by expanding the workforce. In the past they allowed only "foreign talents" with selected skill sets to work here. These days it is anyone from the coffeeshop help to the IT support guy. Falling productivity means a large segment of Singaporeans will their income falling - and an unlucky few will form the ultra-underclass in Singapore....and this race to the bottom has not ended yet. Like the PAP 2-child policy, the PAP govt will keep going even as the problems become apparent to everyone else. By the time they stop, the damage is done and permanent - but nothing ever happens to the PAP for such bad policies, given our political system, the blame, pain and burden can always be passed on to ordinary Singaporeans...
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SingaporeHome > Breaking News > Singapore > Story Dec 9, 2009

Foreign workers in demand
Almost half in SCCCI poll say business growth hit by quota on such workers
By Cassandra Chew Contractors and manufacturers, companies that rely on foreign workers, want the Government to allow them to hire more of them. -- ST PHOTO: ASHLEIGH SIM

COMPANIES that rely on foreign workers want the Government to let them hire more of them, according to a survey. The call is particularly intense from contractors and manufacturers, who feel the quota should be adjusted for specific sectors. Foreign workers form up to 70 per cent of the workforce in these two sectors. Overall, almost half of the businesses surveyed are unhappy with the foreign worker quota policy. They want it raised in order for them to meet orders, which have been increasing in the past few months as Singapore's economy claws its way out of the red.But such a move could hurt Singapore's competitive edge, said economics professor Davin Chor from Singapore Management University. 'Long-run growth depends on the capacity of our economy to consistently improve on our productivity and the way we tap into cutting-edge technologies,' he said.
casschew@sph.com.sg

Tuesday, December 08, 2009

Emergence of an ultra-underclass..

Twenty years ago, we all boarded this plane that was suppose to take us to Switzerland. Most of us were dropped off nowhere near Switzerland while the pilot and his buddies landed on a paradise island with a tall ivory tower. An unfortunate number had to settle for a place no better than a 3rd world country and perhaps worse.

A few days ago Minister Yaacob Ibrahim spoke of the emergence of an ultra-underclass among the Malay community after a series of tragedies involving young children from broken homes[Link: The ST online article used the phrase "ultra-underclass" when it first appeared but removed it later]. I believe this underclass is not restricted to Malay community but exists in all ethnic groups. This ultra-underclass is caused by a combination of broken homes and low income resulting in children with poor upbringing. Why is there surprise over having people poor and marginalised when the income gap is so large? 20% of Singapore households have monthly income less than $1200 per month. Try supporting a family with this income in Singapore. While there are many reasons for seeking divorce, money is one of the leading causes of divorce and when you are trying to support your family with $1000 a month, the strain on the marriage is just enormous.

We don't have minimum wages, we have no safety nets, the govt believes in passing as much financial burden as possible to families when they get sick and there is little help for the unemployed. The govt's piecemeal minimalist approach to giving help adds to the stress and strain of the low income families. At the end of the day, when these families breakup and their children end up poorly educated, the cost to our society will be even higher. Many of these families are poor due to no fault of their own. The govt allowed low wage workers to be imported by the hundreds of thousands causing the incomes of the bottom 20% to become stagnant as the cost of living rose. The PAP govt added more challenges to those who are already challenged so Minister Yacoob....don't look so baffled by the emergence of this ultra-underclass, you have to look no further than the policies of the party you belong to.

Day trading and EMH ....

On a sardine packed MRT, I saw a 20+ yr old girl sending this SMS:
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" I recovered all my yen losses on the stock market yesterday...ha ha ha"
- 20 yr old on MRT
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I wasn't peeking - the MRT was so packed she was holding her phone right in front of my face. I don't know if she was a professional trader but she looked more like a student than anything else. A few weeks ago, I went to meet my broker (yes, I still have a human broker) to collect some reports and noticed rows computers at the brokerage with people monitoring the market. When I asked my broker what they were doing, she told me they were day traders and they trade all day until the market close. A few weeks ago, there was a report about this feller called Clemen Chiang who peddled options trading strategies for thousands of dollars to thousands of Singaporeans. He had a fake Phd and his methods were so dubious hundreds of his students are demanding refunds[Link]. There is no shortage of students for this type of courses - we still see adverts on the Straits Times offering them. The notion that you can make money trading in markets and quit your day job is appealing to Singaporeans however the truth is it is really much harder than what most people imagine it to be and many unscrupulous characters will sell this false unrealistic dream by telling you that it can be done and they can teach you to do it. They will collect thousands in fees as they send you to the slaughter house equipped with useless strategies.
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The main reason why frequent traders will lose money is markets are generally efficient and will not throw up money making opportunities on a daily basis.
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Here is Robert Shiller explaining the Efficient Market Hypothesis.


In the video Prof. Shiller cited a study in Taiwan that showed than only 1% of the day traders that made money. This study was conducted by researchers from UC Berkeley and the report is found here[Link].


"Most day traders, especially heavy day traders, lose money trading. Why do investors engage in such a wealth reducing activity? One possibility is that investors simply find day trading entertaining. Undoubtedly some investors do find day trading entertaining, but can entertainment account for the extent of day trading that we observe? Day traders with a minimum of $NT 90 million in our six month ranking period incur average daily losses of $NT 7,338 during the subsequent month. On an annual basis this is equivalent to slightly more than $NT 2 million, over five times the average annual wage in Taiwan and two and a half times the mean annual salary for employees of financial institutions. "

- Do Individual Day Traders Make Money? Evidence from Taiwan

In the US the SEC has set out to warn investors as well as punish firms that use deceptive techniques to lure investors into this form of trading[Link]. In Singapore we not allow people like Clemen Chiang to peddle and enccourage people to engage in harmful forms of gambling using poorly conceived strategies, brokerages are allowed to offer something known as contra-trading. This form of short term trading in which the trader puts no money down to purchase stock which he has to sell within 5 days is allowed only in 2 countries in the world because it is often associated with gambling. Our authorities do nothing about these things because they believe that part of developing our capital markets is to keep trading volume high even if it means having hundreds of thousands of people engaged in activities akin to gambling. But really if we do not educate people and have better regulation what we will end up with is not a financial hub but a big casino.

Sunday, December 06, 2009

Sino-Environment : Mystery bankers, dodgy deals, missing millions

We have about 170 Chinese companies listed on the SGX. These are know as S-share or S-chips (those in Hong Kong are known as H-shares). The SGX initiated efforts to court Chinese-based companies to raise equity funds in Singapore in 90s. This was aimed at developing the capital market in view of the limited number of companies in Singapore, given the size of our economy.The exchange has inked MoUs with the provincial governments of Zhejiang, Shandong and Liaoning, as well as the Wuxi municipal government to facilitate the listing in Singapore of companies from those areas. The number of S-shares hit by accounting problems is very long including Oriental Century Ltd, China Sun Bio-Chem Technology Group Company and Fibrechem Technologies Ltd. FerroChina Ltd has halted production in China and filed for bankruptcy. The latest scandal involves Sino-Environment and the extent of its problems became clear only when auditors from PwC went to China to do a special audit on the company - before that, the company ran into problems when it was found the the company CEO had pledged his stock to borrow from the bank and defaulted on the loan.

'SIAS calls on the authorities in China to immediately demonstrate its willingness to conduct a thorough investigation into this company's affairs in China and bring any wrongdoing under the weight of the law, if the confidence of Singapore investors in Chinese companies is to be restored' -Mr Gerald of SIAS.
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The Chinese authorities have thousands of corruption cases in their own country to investigate so it is not clear when they can 'help' Singapore. Afterall it was SGX that wooed all these companies to list in Singapore. We can't do anything about these wrongdoers after they run back to China. It will be too late anyway for investors because in most cases, the money is already gone. Singapore has no authority to presecute these wrongdoers so you can guess what type of companies will want to seek a listing here.
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SGX will always seek to expand the number of companies listed on the exchange as it is a profit oriented company that has to answer to its shareholders. These moves serve to develop our capital market. As Singapore aims to develop its capital market to benefit the banks, brokers and stock exchange, it should not do so at the expense of the ordinary Singaporeans who are investors. These companies because they can cook the books are frequently used by syndicates[Read Confession of an S-Chip CEO] to make money. It is foolish (for Singapore as a whole) to boost the profits of our brokerages by $100M but end up with losses of $200M for Singapore investors. SIAS instead of asking Chinese authorities to help with the mess, should be pushing our regulators to tighten up listing rules in Singapore. While there is no way to absolutely avoid fraud, more can be done to reduce the number. We should at least have Singapore appointed auditors look at the books of these companies before their carry out their IPO here...otherwise it as easy as coming to Singapore to scoop tens of millions back home to China.

After all the problems faced by investors for these S-shares, SGX now want to court Russian companies to list here:[Link: Singapore Stock Exchange Listing To Lure Russian Companies]. I'm sure they will be more than happy to come here during our next bull market.

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Mystery bankers, dodgy deals, missing millions


(Business Times)


Sino-Environment supposedly paid millions for materials that were never delivered: PwC


By LYNETTE KHOO



(Singapore) THE auditors travelled to China to probe cash transactions made by Sino-Environment. It turned out to be a rocky journey as the company staff and its supposed 'bankers' appeared to have laid roadblocks at every step.
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The company's chairman and CEO refused to provide authorisation letters for PricewaterhouseCoopers (PwC) to obtain statements directly and independently from the banks. PwC officers were forced off the premises of one bank by a 'branch manager' (as he introduced himself) and had the roller shutters pulled down in their faces. Elsewhere, a specific bank officer was similarly pre-arranged to meet the auditors and they could not verify the statements they were shown. Even so, the special audit by PwC found that some $85 million worth of transactions were made by Sino-Environment without board approval and authorisation.But no raw materials or equipment were delivered despite the purchase agreements nor was there any significant work done at the projects that the group purportedly invested in.


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SIAS president David Gerald said that the association will approach the Chinese embassy in Singapore to relay its concerns.
The damning report was released yesterday by the independent directors. PwC, the group's statutory auditor, was engaged in May to review significant cash transactions from January to June. In March, the company was in possible default on repayment of a $149 million convertible bond issue and its shares have not traded since September.PwC based its findings on interviews and review of documents available up to Sept 15.Its report noted that Sino-Environment unit, China Energy Environment, made a payment of about 920 million yen ($14 million) on May 22 allegedly to a Japanese company on behalf of another unit Fujian Thumb Environmental Facilities Co (Thumb Facilities) to buy Denox raw materials.But as at Aug 26, no raw materials had been delivered.


PwC was later informed by the Japanese firm that it did not enter into the purchase agreement, had not received any payment, and did not have an employee bearing the name of the representative who signed the contract.The management took PwC to Xiamen International Bank rep office in Quanzhou, where there were only the bank officer, receptionist, and a 'branch manager'. The bank officer came with prepared bank statements and refused to take questions. Here was where PwC was forced off the premises by the 'branch manager'.PwC also found that another Chinese subsidiary, Fujian Fuda Desai Environment Protection Co, paid a total of 230 million yuan ($50 million) to various parties from Jan 1 to June 30 to invest in four separate waste power plants projects. However, there were no documents showing that the rights to the rubbish dumpsites had been transferred and no significant work has been carried out on any of the projects. Later, when the auditors tried to verify the bank documents (on these investment payments) given to them by the management through visiting Bank of Communications, Fuzhou branch, the specific bank officer who met them was a relationship manager for personal banking (according to his name card) - not for corporate banking.The bank officer only provided the auditors with the documents the following day and refused to let them approach other bank staff to confirm the authenticity of the documents. PwC noted that there were also instalment payments of 46.50 million yuan made by unit Thumb Facilities to buy equipment for a plant.


.The auditors said that they are unable to comment on the 'reasonableness of the costs' of these assets as they could not inspect them up-close during their site visits nor review any competitive tenders.The audit findings also showed that another group subsidiary Fujian Weidong EPT Co made two interest-free loans totalling 55 million yuan to two parties not related to the group. Independent directors (IDs) of the group - Goh Chee Wee and Wong Chiang Yin - yesterday expressed extreme concern about the PwC findings and reiterated their call for the executive directors (EDs) to step down.'The findings in the PwC report call into question the conduct of the executive directors, and in particular, the conduct of Mr Sun Jiangrong, the chairman and CEO of the company,' the IDs said.Mr Sun's personal financial woes snowballed into lawsuits between him and his creditor, his loss of a 56 per cent stake in the group and led to the group's possible default on the convertible bonds. He claimed to have $40 million in the company's coffers during his phone conversation with David Gerald, president of Singapore Investors Association of Singapore (SIAS) on Monday. But the EDs clarified that this was an estimated aggregate sum which included trade and other receivables.The IDs said that they were 'surprised and troubled' by this change of position and urged the EDs to inform shareholders of the exact amount of cash reserves and remit them to the group's Singapore bank account immediately.The EDs had asserted that they would remit the $14 million from the account in a Xiamen bank to Singapore if the IDs agree to certain conditions. The IDs said that 'to avoid further debate on this issue', they agreed to the conditions and 'fully expect the EDs to remit the $14 million from XIB to the company's Singapore account without delay'.Mr Gerald said that SIAS will approach the Chinese embassy in Singapore to relay its concerns.'SIAS calls on the authorities in China to immediately demonstrate its willingness to conduct a thorough investigation into this company's affairs in China and bring any wrongdoing under the weight of the law, if the confidence of Singapore investors in Chinese companies is to be restored,' Mr Gerald said.He also urged the IDs, together with shareholders, to take action to appoint a new board to ensure that the company's remaining assets are fully protected.

Friday, December 04, 2009

Cooling day for RATIONAL decisions..

You know the election is coming when they find ways to tweak the rules like that "cooling off day" they added. I really don't know what to make of it. Perhaps they are afraid some report about the next pay hike for ministers or next GST hike will leak out or get fabricated on the Internet one day before voting day and cause votes to swing to the opposition. The Worker's Party said it would be possible for all sorts of (positive) news and explanations from civil servants (who have become not independent) to get aired on that day to swing the votes to the PAP. Mr. Brown in his latest comedic podcast speculates soothing music being played over the airwaves and "Men-in-white" propaganda going on TV that day. The Opposition already has so much stacked against it including the short minimum 9-day campaign period to get their message out, how the boundaries will be drawn, lack of (positive) coverage on the state controlled media and the pork barrel tactics of estate upgrading and handling out of New Singapore Shares just before the elections....so what is the big deal about "cooling day"? The Opposition already has so many hurdles to clear, one more in the form of this "cooling day" just add to the numerous difficulties and the unlevel playing field they should be used too by now.

The PAP claims that the purpose of the cooling day is for voters to think rationally before they vote. I find it strange ...because the PAP has this habit of shocking us into voting for them like saying this country will sink without them, that the opposition is full of flyby night shady characters, that Chee SJ is a gangster, that our homes will become dilapidated and worthless, our daughters will become maids if we vote for the opposition....last elections, they said that the Worker's Party manifesto was full timebombs and poison. It is all threat and fear to get us to vote for the PAP so why in the world do they want rationality? Rationality can only work against them! So I don't buy the rationality reason for the cooling day.

... We don't have to wait for the election cooling day to think rationally - we can start right now....

I would like to ask Singaporeans this RATIONAL question right now:

Are you better off than you were 4 years ago?

Another RATIONAL question would be:

What are 5 things that PAP govt has done that benefits Singaporeans in the past 4 yrs?

Yet another few RATIONAL questions:

Does the peformance of our leaders justify their salaries?

Do you feel greater financial security today than you did 4 years ago?

Given the increasingly complex globalised economy which forces tradeoffs in policy making, wouldn't it be rational for Singaporeans many of whom see their interests being traded off in favor of big business to want more diverse views to be represented in parliament?

What is the worse that can happen if the PAP loses 10-20 seats?

Anyway, will people really miss those part time PAP MPs with little to say on critical life-affecting issues?

Everyone in Singapore should think rationally about how they should vote. I will definitely spend the 24 hour cooling period to reflect on what the PAP has done in the past 4 years and I'll post my thoughts rationally and coolly on this blog so that everyone can rationalise what they want to do with their vote and what they want for Singapore, themselves and their children in the long term.

Thursday, December 03, 2009

Meritocracy Transformed to Elitism & Inequality

'The concept of meritocracy is unstable as its constituent ideas are potentially contradictory. The egalitarian aspect of meritocracy, for example, can come into conflict with its focus on talent allocation, competition, and reward. In practice, meritocracy is often transformed into an ideology of inequality and elitism. In Singapore, meritocracy has been the main ideological resource for justifying authoritarian government and its pro-capitalist orientation.'
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- Meritocracy and Elitism in a Global City: Ideological Shifts in Singapore, International Political Science Review [Link]
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The end result of the PAP system is this belief that the elites who are the PAP leaders are indispensible without whom this country will sink and the ordinary Singaporean has been downgraded to an expendable being easily replaced by foreign imports. The PAP conducts numerous campaigns to tell us about "Staying Together" and "We are one" so that we to buy into this system as it drives us apart. If you examine their policies, the long term interests of ordinary Singaporeans have frequently been traded away. The Foreign Talent policy which morphed from a policy to attract the best talents, later to supplement our manpower shortfall and after that as a solution to low fertility rates. They tell us "Foreign Talents help to create jobs" when it actually suppresses the income of many Singaporeans leading to a widening income gap[Link].

Wednesday, December 02, 2009

North Korea short changes its citizens.....literally

Here is how they do it in N. Korea - declare the old currency worthless and allow each person to change a limited amount of money, 150000 won (=US$50 on black market) to the new currency. Overnight they wiped out all the savings of its citizens and completely eliminated a miniscule middle class that was emerging. After flattening everyone else by confiscating their wealth, dictator Kim and his cronies will probably get to eat more beef and drink more wine every night. That is what you get when you put dictators in charge of a fiat money system. They are making Bernanke's quantitive easing (printing money) look so kindergarden. I hope those enterprising Singaporeans who went all the way to N. Korea to start a fast food joint [Link] didn't lose their shirt and pants.

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Anger over North Korea's shock currency change
SEOUL, SOUTH KOREA (AFP) - North Korea's shock currency revaluation has sparked anger and frustration in the isolated communist state as citizens see much of their savings wiped out, reports and observers said Wednesday.

They said the North had tightened security against possible agitation following Monday's redenomination, with a curfew reportedly imposed in a border region and shops closed across the country during the change-over.
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Media reports and embassies in Pyongyang said people had been given a week to exchange 100 old won for one new won, but the amount they can change was strictly restricted.
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While the move has yet to be announced by official media, analysts said itappeared aimed at curbing inflation and clamping down on burgeoning free markets in an attempt to reassert the regime's control. South Korea's Chosun Ilbo newspaper said the main motivation "appears to be Kim Jong-Il's intention to throttle the emerging free market" before an eventual handover of power by the Korean leader to his youngest son Jong-Un. The regime has already taken steps to curb free markets. These sprang up after the state food distribution system collapsed during famines in the 1990s, but are now seen as threatening the state's grip.
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Professor Nam Ju-Hong of Kyonggi University told the paper Kim had "declared war against market forces" because his efforts to control trade had failed. Analysts said authorities initially limited the total sum that an individual can exchange for new currency to 100,000 won. Because of widespread protests, the limit was raised to 150,000 won in cash and 300,000 won in bank savings, according to DailyNK, an online newspaper with informants in the North.
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The official exchange rate is 135 won to the dollar but the black market rate is between 2,000 and 3,000. "Hardest hit were the emerging middle-class who had earned big wealth from the jangmadang (markets)," said Lee Seung-Yong of Good Friends, a Seoul welfare group with contacts in North Korea. "They were angry and frustrated since most of their wealth based on the previous banknotes has been chipped away," he told AFP. But Lee said he expected no organised protests given the state's tight control over society. "The main goal is to crack down on the private markets that had stoked capitalism and to place socialism back in control," Lee said. Good Friends said in its newsletter that authorities were using loudspeakers installed in towns, farms and homes to spread news of the currency change. It said major cities including the capital Pyongyang and Sinuiju on the border with China were quiet, with shops, public bathhouses and restaurants mostly closed and long-distance buses not operating. The sudden revaluation angered market vendors and others. "I worked like a dog for two months for the winter, but the money became useless paper overnight," Good Friends quoted a Sinuiju resident as saying. DailyNK said security forces mounted extra street patrols and imposed a curfew in North Hamkyung province in the northeast. "After 10:00 pm all movement is prohibited. Offenders must be strictly regulated," it quoted the curfew notice as saying. All shops, markets and stores remained closed due to a temporary ban on trading during the week-long exchange of bills, it added. Any activities requiring monetary payments were being suspended until new currency is legally circulated, Good Friends reported. "The purpose of the currency revaluation is to crush private commercial activities, considered to promote anti-socialism," said Good Friends. "Kim Jong-Il must have wanted to bring the money out of the private safes and by doing so must have also hoped to ease public dissatisfaction resulting from growing social stratification," the Korea Herald said in an editorial. "Yet, such a drastic measure amounts to confiscation and could backfire even under the ruthlessly controlled system of the North."

Tuesday, December 01, 2009

Meritocracy and an unequal society....

Geneticists have found that among all primates, humans have the smallest genetic differences[Link]. In fact genetic evidence show that biologically speaking there is no such thing as race[Link][Link] because, according to researchers writing in the open access journal BMC Genetics, overall there are more genetic differences within ethnic groups than between them. I talk about race only as an example to illustrate the tendency in humans being as group or as individuals to artificially differentiate themselves from others when there is actually no real difference at all[While looking for material for this post, I found this interesting paper on MM Lee's thoughts on race & genes found on the NTU server]. For a start human beings are more similar to each other than other species yet we end up with living conditions of extreme variation. I intend to show you that unless there is proactive intervention to bring about greater equality, (some) human beings will construct systems to amplify small differences among us or create differences when there are none - systems in which rewards are disproportionate to effort and ability and they will even have us believe it is all just and fair.


When Vivian Balakrisnan headed the Remaking of Singapore, he said you can change anything but meritocracy is a sacred cow we cannot slaughter. There is the prevalent and ingrained belief that it is the key to our success. I want to start by asking what meritocracy is. The term meritocracy originated from a novel called The Rise of Meritocracy published in 1958. In this novel, a social system based on meritocracy led to a social revolution in which the masses overthrow the elite, who have become arrogant and disconnected from public sentiment[Wikipedia Link]. In a meritocratic society, people are rewarded based on talent + effort. Nothing wrong with that. You work harder you get more. You're work smarter, you get more. You don't work, you get nothing. On the surface it sounds fair and just. You might have to get over a few minor issues like what talent is, how effort is measured and so on. Then you have to link talent + effort to rewards. That is where it usually goes wrong. You can run a meritocratic system where a person is paid $10M or $100K....so how do you decide? Why is the Prime Minister of a meritocratic govt paid, something like 5 to 10 times more than leaders elsewhere? In Singapore, they use some kind of proxy mechanism linking leaders and public servant pay to the people of 'similar' talents in the private sector. Many question if this link is right...but lets put that aside first. The assumption here has to be the private sector which is somehow linked to 'free markets' pay people what the deserve because if it doesn't, the way meritocracy is implemented in the Singapore govt simply leads to people being paid more than what they deserve. Is what people deserve the amount the system allows them to take?

Michael Jackson was a phenomenally talented and hardworking entertainer. When he died it was estimated that he earned about US$500M to US$1B[Link]. Industry experts believe that it is unlikely that another entertainer will ever make this amount in real terms for several reasons. Michael Jackson emerge at a time when CDs which have quality that were better than cassettes were becoming popular, when music videos started to take off and consumer taste for music was less diverse. If he was born 20 years earlier of later he would have made much less for the same effort and talent. He also made hundreds of millions off the rights to the Beatles collection which he bought after receiving a tip from Paul McCartney[Link]. It is hard to say what he actually deserve for his work but what he received was a function of many things other than his own ability. Do the bankers who were partially responsible for the financial crisis deserve the millions they took in bonuses? Do the workers who have nothing to do financial crisis deserve to be retrenched by the problems caused by it? How fair is a system that does not deliver the rewards to those who deserve it and too much to those who don't?
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You don't have to go through a lot to figure out if the system is working well or not. All you need to look at is the relative level of inequality. Income inequality is the highest ever in the last 80 years since the period just before The Great Depression. It is not hard to believe that the system runs into problems when it cannot distribute wealth fairly. When we have inequality on a scale we see in recent years, you cannot blame individuals for their own plight - it is built into the system. The distribution of human abilities has not change what has change is the system. Govt policies have to work against business monopolies, unfair practices and make sure the playing field is level. If inequality still persists, there is no choice by to resort to progressive taxation to narrow the gap - because at the end of the day, the cost of having a high level of inequality will be far greater than the negative effects caused by higher taxation.
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Meritocracy as it is practiced in Singapore is an accomplice to this inequality. It results in an inherent belief that people get what they deserve and seek to preserve a system that perpetuates and widen the inequality. At a time when the income gap is the widest around the world we have the biggest gap among developed countries. It is far larger than Japan, Taiwan and S. Korea...almost double measured by the GINI. It is not possible that we have this unusually big disparity in terms of talent among our population - this inequality is articifial. It is function of the system.
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When NMP Viswa Sadavisan spoke about equality in parliament, MM Lee said that equality should be an aspiration not an ideal and that it is a high highfalutin idea. That explains why the PAP govt does so little to bring about greater equality and expend so much energy to up the salary of its ministers in the pursuit of meritocrary. At the end of the day, if you think about it, meritocracy is a vague ambiguous idea the outcome of which, very often, is dictated by those who run and manipulate the system. Equality is a very clear idea that all of us can understand and work towards. Equality should be an ideal for our society...and meritocracy is but a highfalutin aspiration sometimes used to deny us the equality we pledge to pursue.