This is a comprehensive addition to the previous Policy Paper released by SDP entitled “Wealth and Poverty“.
Introduction
Economic growth in Singapore has, in recent years, benefited the few who control economic production at the expense of the masses who are forced to work harder and harder just to ensure that their basic needs are met.
Statistics bear this out: Between 1998 and 2003, the average household monthly income of the poorest 20 percent of the population decreased by nearly 15 percent while the richest 20 percent increased by 11.7 percent.
What is needed is an economic system that works for the people, not vice versa. For this to happen, we need an economy in which the people can participate, one that the people, both employers and employees, truly own.
In others words, a democratic economy. Material gain must have a collective social good. Gain for its own sake can be destructive to social processes and to the activities of a community. Social good can only come about when the people are not alienated from the decision-making process and when community bonds are strengthened instead of weakened. For this to happen in Singapore, reform is needed in the following areas:
Upgrade minds, not just skills
Singapore’s educational system has focused on almost entirely on rote learning and students’ performance in year-end examinations. This has resulted in a populace that has been adequately schooled but woefully undereducated to meet the needs of rapidly changing economic conditions.
Such a sterile and restrictive environment extends into the general society. At the moment, participation in the political process is conducted through government-approved channels such as the local media, feedback units, and residents’ committees. There exists little or no avenue whereby the people can organise themselves independently and exercise their franchise as citizens.
The less control an individual has over his or her environment, the more that individual retreats into alienation and disengagement. This sense of learned helplessness is anathema to resourcefulness, innovation, and productivity.
The government is presently conducting another of its campaigns, this one targeted at upgrading workers’ skills. Without a concomitant upgrading of their minds, however, workers will continue to be put through a slavish, interminable loop of working harder and harder for smaller and smaller returns and will endure more and more economic insecurity.
Education must not be reduced to a tool to serve the economy. Such a strategy will defeat the purpose that educational reform was meant to achieve. Instead, education must be coupled with societal conditions that allow the people to exercise their skills as well as upgrade their minds in the most productive way. For this to happen, the political system must undergo an overhaul, the subject of discussion in the next section.
Democratise the economy
Much has been made of the notion that democracy may actually hinder economic growth. In Singapore, this idea has been put in practice for all of its post-independence existence. The PAP, in trying to isolate economics from democracy, completely misses (or refuses to acknowledge) the point that the absence of political participation of the people has an adverse impact on the economy.
It doesn’t take a lot to see that how people live and how they organise their lives depend on the way in which economic activity is constructed. It is therefore only natural that citizens want to live in a system in which they have a say.
But when people are prevented from taking part in the political process, disenchantment sets in. Emigration then becomes an attractive, and sometimes the only, alternative. This is exactly what is happening in Singapore. Singaporeans are leaving the country by the thousands and not returning. The economic costs of such loss in human resource is incalculable. In his regard, a democratic polity is indispensable to the economic sustenance of a society.
Not only does democracy not hinder economic growth, it actually facilitates growth. Creative thinking is what makes entrepreneurs successful, and it is through these entrepreneurs that jobs are created. One analyst commented that “Singapore’s problem is expecting competent technocrats at home to operate as fire-in-the-belly entrepreneurs elsewhere in Asia, without creating a political climate in Singapore that rewards free enterprise.” If Singapore is going to remain economically viable, politics in the republic cannot remain unreformed.
Introduce Singaporeans First Policy
One of the ways that the Government tries to solve the brain-drain problem is to open the gates to foreign workers. Such a policy is not wrong per se. What is problematic is that this is done indiscriminately and with the objective of suppressing wages by atracting cheap labour from our neighbouring countries.
The SDP has been and will continue to advocate a Singaporeans First Policy, which will insist that employers retrench foreign workers first and only lay off Singaporean workers as a last resort. In addition such a policy will require the Government and employers to employ foreigners only if locals cannot be found for the job. This will ensure that only qualified foreigners will be allowed into Singapore.
Scale back GLCs
Quite apart from the conflict of interest generated by direct involvement of government with business, there is also the problem of inefficient use of resources by Government-linked companies (GLCs).
Pretend as they might, GLCs cannot provide, much less sustain, economic development in Singapore. They must be dismantled and, in their place, local private companies must be allowed to surface and be given the chance to compete internationally.
Examples of economies where the domestic private sector, and not the state, takes the lead in the country’s economic development abound. Taiwan is a case in point where the government encourages entrepreneurship by providing a business-friendly environment, but at the same time keeping itself from becoming directly involved in the corporate world. Ireland, Japan and South Korea are other instances in which the authorities provide the basic infrastructure so that private enterprise can develop.
It is crucial that Singapore makes the transition from a state-dominated economy to an economy in which private individuals take the lead. This will, of course, require a sea change in the thinking of the PAP. No one is expecting this to happen anytime soon as the government has emphasised repeatedly that GLCs will remain a firm feature of Singapore’s economic structure. Unfortunately, it is precisely this continued economic strangulation by the government through GLCs that will cause even greater hardship to the people of this country.
Pay retrenchment entitlements and introduce minimum wage
Under the present system these workers have little financial protection when they are retrenched. This causes severe strain on the entire family with serious social repercussions. Under the SDP proposal, the Government will pay all retrenched workers their full salary for the first six months. This amount would be reduced to 75 percent during the next six months, and further reduced to 50 percent in the third six months. Each worker will be allowed to reject only up to three job offers in the one-and-a-half years following which the retrenchment entitlement ceases. Such a scheme will provide workers a cushion when they are retrenched while at the same time encourage them to seek employment.
The matter of paying workers a just and minimum wage is dealt with under the section of Wealth and Poverty which was presented in the earlier set of policies and thus will not be repeated here.
Introduction
Economic growth in Singapore has, in recent years, benefited the few who control economic production at the expense of the masses who are forced to work harder and harder just to ensure that their basic needs are met.
Statistics bear this out: Between 1998 and 2003, the average household monthly income of the poorest 20 percent of the population decreased by nearly 15 percent while the richest 20 percent increased by 11.7 percent.
What is needed is an economic system that works for the people, not vice versa. For this to happen, we need an economy in which the people can participate, one that the people, both employers and employees, truly own.
In others words, a democratic economy. Material gain must have a collective social good. Gain for its own sake can be destructive to social processes and to the activities of a community. Social good can only come about when the people are not alienated from the decision-making process and when community bonds are strengthened instead of weakened. For this to happen in Singapore, reform is needed in the following areas:
Upgrade minds, not just skills
Singapore’s educational system has focused on almost entirely on rote learning and students’ performance in year-end examinations. This has resulted in a populace that has been adequately schooled but woefully undereducated to meet the needs of rapidly changing economic conditions.
Such a sterile and restrictive environment extends into the general society. At the moment, participation in the political process is conducted through government-approved channels such as the local media, feedback units, and residents’ committees. There exists little or no avenue whereby the people can organise themselves independently and exercise their franchise as citizens.
The less control an individual has over his or her environment, the more that individual retreats into alienation and disengagement. This sense of learned helplessness is anathema to resourcefulness, innovation, and productivity.
The government is presently conducting another of its campaigns, this one targeted at upgrading workers’ skills. Without a concomitant upgrading of their minds, however, workers will continue to be put through a slavish, interminable loop of working harder and harder for smaller and smaller returns and will endure more and more economic insecurity.
Education must not be reduced to a tool to serve the economy. Such a strategy will defeat the purpose that educational reform was meant to achieve. Instead, education must be coupled with societal conditions that allow the people to exercise their skills as well as upgrade their minds in the most productive way. For this to happen, the political system must undergo an overhaul, the subject of discussion in the next section.
Democratise the economy
Much has been made of the notion that democracy may actually hinder economic growth. In Singapore, this idea has been put in practice for all of its post-independence existence. The PAP, in trying to isolate economics from democracy, completely misses (or refuses to acknowledge) the point that the absence of political participation of the people has an adverse impact on the economy.
It doesn’t take a lot to see that how people live and how they organise their lives depend on the way in which economic activity is constructed. It is therefore only natural that citizens want to live in a system in which they have a say.
But when people are prevented from taking part in the political process, disenchantment sets in. Emigration then becomes an attractive, and sometimes the only, alternative. This is exactly what is happening in Singapore. Singaporeans are leaving the country by the thousands and not returning. The economic costs of such loss in human resource is incalculable. In his regard, a democratic polity is indispensable to the economic sustenance of a society.
Not only does democracy not hinder economic growth, it actually facilitates growth. Creative thinking is what makes entrepreneurs successful, and it is through these entrepreneurs that jobs are created. One analyst commented that “Singapore’s problem is expecting competent technocrats at home to operate as fire-in-the-belly entrepreneurs elsewhere in Asia, without creating a political climate in Singapore that rewards free enterprise.” If Singapore is going to remain economically viable, politics in the republic cannot remain unreformed.
Introduce Singaporeans First Policy
One of the ways that the Government tries to solve the brain-drain problem is to open the gates to foreign workers. Such a policy is not wrong per se. What is problematic is that this is done indiscriminately and with the objective of suppressing wages by atracting cheap labour from our neighbouring countries.
The SDP has been and will continue to advocate a Singaporeans First Policy, which will insist that employers retrench foreign workers first and only lay off Singaporean workers as a last resort. In addition such a policy will require the Government and employers to employ foreigners only if locals cannot be found for the job. This will ensure that only qualified foreigners will be allowed into Singapore.
Scale back GLCs
Quite apart from the conflict of interest generated by direct involvement of government with business, there is also the problem of inefficient use of resources by Government-linked companies (GLCs).
Pretend as they might, GLCs cannot provide, much less sustain, economic development in Singapore. They must be dismantled and, in their place, local private companies must be allowed to surface and be given the chance to compete internationally.
Examples of economies where the domestic private sector, and not the state, takes the lead in the country’s economic development abound. Taiwan is a case in point where the government encourages entrepreneurship by providing a business-friendly environment, but at the same time keeping itself from becoming directly involved in the corporate world. Ireland, Japan and South Korea are other instances in which the authorities provide the basic infrastructure so that private enterprise can develop.
It is crucial that Singapore makes the transition from a state-dominated economy to an economy in which private individuals take the lead. This will, of course, require a sea change in the thinking of the PAP. No one is expecting this to happen anytime soon as the government has emphasised repeatedly that GLCs will remain a firm feature of Singapore’s economic structure. Unfortunately, it is precisely this continued economic strangulation by the government through GLCs that will cause even greater hardship to the people of this country.
Pay retrenchment entitlements and introduce minimum wage
Under the present system these workers have little financial protection when they are retrenched. This causes severe strain on the entire family with serious social repercussions. Under the SDP proposal, the Government will pay all retrenched workers their full salary for the first six months. This amount would be reduced to 75 percent during the next six months, and further reduced to 50 percent in the third six months. Each worker will be allowed to reject only up to three job offers in the one-and-a-half years following which the retrenchment entitlement ceases. Such a scheme will provide workers a cushion when they are retrenched while at the same time encourage them to seek employment.
The matter of paying workers a just and minimum wage is dealt with under the section of Wealth and Poverty which was presented in the earlier set of policies and thus will not be repeated here.
