OK, I'm learning something from this ex-civil servant. I was wondering - I've never been in the civil service before, and it shouldn't be that he doesn't have anything to teach me about economics and politics.
I’m just an ordinary teacher actually. I don’t have insights due to my civil service stint, other than about the ground realities of education in schools, and also meeting a lot of citizens in the form of students and parents. Just wanted to make this disclaimer of having any special perspectives.
So some European nations are more democratic than the US, but the European Union as a whole is less democratic than the US. I want to connect this back to what I said earlier. It is very hard for the formulation of economic policy to be a democratic process. I'm not familiar with the EU, but it does seem that the central bank in the US is not that democratic. I don't know how it can be made more democratic, or even whether it should be democratic. The US federal bank is supposed to be undemocratic. The Fed chairman does not report to the president. He's like a supreme court justice - once appointed, he does whatever the fuck he wants to do. This is to prevent the president from engineering some growth during election year just so as to get elected again, because often this short term growth can be harmful in the long run. In Singapore, of course, there are no walls within the system, so the central banker can also be the prime minister (I think LHL has been the central banker before).
Yes, I think this central bank independence from elected politicians is “separation of powers”, to provide “checks and balances” – which is considered a good thing for democracy? Another similar structure is the constitution – which cannot easily be changed by the elected representatives (but which in Singapore is kindof fluid in the interpretation – c.f. Kenneth J. and IMF loan case, requirement to call by-election case). Other separation of powers things are the independence and freedom of the press/media from influence by power (being eroded in the US, and we never had it in Singapore), the state of civil society, etc etc.
Well, the EU is really a strange political structure – I think they have been much harsher to their member states like Greece or Spain etc (both in how they frame the problem, and in the policy actions they then take to stop “the problem”) than the US Federal government would have been to any of its member states – and I think they’re motivated by nationalistic interests (I think the EU central gov’t is accused of more often serving the northern states at the expense of the southern ones). Though of course some elements are similar (both the EU and US refuse to blame and punish banks much for the crisis – though EU is getting tougher on banks now, esp Bank of England it seems (some bankers did get charged, and laws on compensation are being implemented). The US most recently didn’t even prosecute HSBC for funding terror states – a sharp contrast to how they deal with individuals who “send money home” to such places).
I notice that you have a contradictory position. On one hand, you don't believe entirely in economic growth. On the other hand you justify cuddly capitalism on the basis that it delivers better growth than the US (not true by the way if we are talking about the numbers since the Great Recession).
I don’t believe in (economic) growth at the expense of society’s well-being and happiness. I also know even if I can personally eschew growth and wealth (as in – I can be a happy man without all the conspicuous consumption?), many other Singaporeans won’t think the same way – so I have to produce arguments that “cuddly” capitalism doesn’t compromise too heavily on growth (the common Singaporean argument goes like this – “You don’t want growth? Then eat what? You want Singapore to become like _______ [insert currently notorious 3rd world country name here]?”). And ultimately, I’m hoping once you give people a taste of life in egalitarian society, they will end up shifting their goal-posts in life (at which point people accuse me of being evangelistic about how we should live life).
But first I think it’s good to show people that “cuddly” systems aren’t that inefficient and uncompetitive when compared with so-called “cutthroat” systems – which seem to have an innovative edge, but suffer from some inefficiencies too – e.g. in the US healthcare. In fact, Chang Ha Joon has argued that unemployment and retraining benefits stimulate innovation and adaptability for individuals (encourages people to pursue jobs without fear of being made redundant and retrenched) the same way that bankruptcy laws and limited liability laws do for firms (encourage entrepreneurs to pursue business ideas without risking all their assets and even their liberty/life) – he talked about how in no-safety-net employment regimes e.g. in S. Korea, there is a disproportionate channeling of talent to “safe” industries like doctoring and lawyering (and maybe finance nowadays), rather than taking chances on being engineers (who might be made redundant).
We often criticize Singaporeans for not taking risks (I have said that to my ex-students too often) – but it’s partly also because we don’t have good safety nets. Who wants to risk not doing well at PSLE, or ‘O’ and ‘A’ levels? And then beyond? (And if everyone channels more effort into doing well in exams – won’t they have spent less working on other things? And then we lament that Singaporeans are only good at exams, but not at innovating, at presenting, at selling ideas, at lifelong learning, etc) And if we lambast Singaporeans for not taking risks – we should consider the returns on taking risks in Singapore (not just economic returns, which are bad enough in an environment dominated by GLCs, but other intangible things like esteem and respect from society – there is too much stigma on not having made it economically, and not enough respect for gumption and fighting spirit).
I agree that we have to rethink growth. In an economic equilibrium there should not be growth. There will be good years and bad years, but no growth. Technological innovation is the only true source of economic growth. Everything else is fucking around with the numbers. I believe in economic evolution, in technological progress, but not economic growth. The US has been able to deliver economic growth because it has been able to deliver technological advancement.
Yes, yes – agreed. In fact in Singapore we seem to have put the cart before the horse, or the tail wagging the dog. When population shrinks, growth will go down, naturally. But in Singapore, to make growth go up – we import population! (In Soviet Russia, growth make you populate!)
When you think about the PAP's motto, "more good years" it does make sense. And it does not even have to be interpreted as "we have growth every year". It should be interpreted more as "we've reached a certain level of prosperity, let's maintain this over the long run". These days I think they don't use that motto anymore because it can be interpreted (legitimately I think) as "more of the same fucked up shit". Life is not getting better in Singapore and anybody who is looking than more than just the numbers will understand that.
To me the bigger problem is fundamentalism. In the past, the PAP built its platform on delivering economic growth. People who understand Singapore of the 60s and 70s will also see that it was the right thing to do, and there's very little controversy about that. Problem is when they started believing "growth is always always good". (note that this is a deliberate echo of some fucktard saying that "competition is always always good") Then a lot of what happened in the last 2 decades was down to wanting to sustain rosy growth figures. Asset enhancement fucked everybody over but hey it gives you many years of double digit growth so it can't be that bad. Attracting the wealthy from all over the world fucked everybody over but hey it gives you many years of double digit growth too.
So this idea of growth is an idea that once was good but people started getting stuck on this idea and it became something of a fundamentalist thing with the Singapore govt. The ministers started saying, "it doesn't matter if I'm going to fuck Singapore in the process, when I deliver 8% growth every year, you pay me millions of dollars". Then this idea got stuck, and the system got fucked.
So the thing is, how do you unfuck the system, how do you remove an idea once that idea stops being a great idea. How do you get people to change their minds about things and abandon the old mental models. If you read Donald Low's essays, they are all about the problem of people getting too hung up on ideas that are no longer relevant. So democracy is part of the solution, but also it depends on citizens being informed, citizens educating themselves, and a lot of other things we discussed earlier.
Again I agree. We can call it lots of things – growth fundamentalism (you’re not alone – lots of people have criticized neoliberal economists to be as dogmatic as priests), overly narrow KPI (a civil service wide problem? Starting from who, you wonder?), tunnel vision, excessive corporatization (c.f. arguments for ministerial salary, metaphors like “Singapore Inc.”), etc
And I think you can identify a clear period when this started – more or less the late 1980s or early 1990s. (Perhaps it has to do with the fall of the Berlin Wall? No more socialist threat? Or perhaps Goh Chok Tong caused the change?) I remember reading Toh Chin Chye’s parliamentary speech from 1984, where he took pains to emphasize he was not a capitalist, but he was a pragmatist, and we should do what is good for Singapore (something like that) – which showed the distrust of capitalism back then (c.f. also all the criticism of “Westernization” – and our need for Asian values – then vs the inevitability and embrace of “Globalization” today).
So – well – you and I might think a narrow measure of growth is not the only or even the main thing to worry about. But it’s not easy to sell that idea to Singaporeans. Especially when for some their lives aren’t very materially comfortable (due to wealth inequality), and for those who are materially okay, or even well-off, even if their material lives are comfortable, they have too much material aspirations – and maybe you don’t blame them because that’s the culture here. People judge you based on your job, your material trappings. My friend has told me he’s not looking for high pay for the money, but for the respect from family and friends (he and his wife have a really simple lifestyle actually). So part of the problem is an Asian-style consumerist culture.
If you want me to describe my position, I once said that I was a moderate. Now I think that "agnostic" is a more accurate description. No wonder so many of the anti-PAP faithful are so angry with me. I am a skeptic, and I believe that skepticism is necessary for democracy. The paradox is that even people who are skeptical of democracy itself are necessary for democracy. If you can't deal with people throwing in your face ideas that you don't agree with, you should just go and live in a dictatorship. Well, we are all living in a dictatorship. People with this "always always" mentality, once you put them in charge of Singapore, they will run it into the ground.
On the freedom for even skeptics – of course! And on freedom for fervent anti-PAP-ism? Yes they’re free to talk too. What was the cliché line? Something about I may not agree with what you say but I will defend to the death your right to say it. Hmmm… it is difficult to comment on this thing. Speakers who criticize their audiences risk alienating them. Maybe it’s too personal – let’s talk about other things instead?
I don't believe in growth, I don't believe in wealth, but I certainly believe in innovation. I don't really understand enough about cuddly capitalism to know whether a great innovation environment is hard to achieve with cuddly capitalism. I hope that it is. In any case, here's a fun fact for you: San Francisco is the most liberal city in the US, and it is right next door to Silicon Valley. I believe that a good startup environment is inherently democratic. Anybody who has a great idea can start up a business, and in 10, 20 years become a rich man. He can have a great voice in local politics. People don't have to spend their lives sucking other peoples' dicks to stay alive. The great weakness in Singapore's economy is that too much rests on either MNCs or GLCs. The third pillar must be built. Unfortunately, as of now, in spite of our great educational standards, I see little evidence of this. Our innovation culture is screwed up. Too much top down and too little bottom up.
I commented on culture of innovation a bit in the section on safety nets. I remember Martin Nowak’s book, Super Cooperators, where there was a chapter on what kinds of networks encouraged innovation. He talked about stomach wall cells, where cell division was very “top-down”. Replication of genetic material is “designed” to be top-down there, due to frequent division. And innovation in DNA usually means cancer. Then he talked about the nature of bottom-up networks which I forgot. But basically he shows evidence from mathematical modeling that supports bottom-up networks for innovation and transmission of innovation, and top-down networks for suppressing innovation and its transmission. So I also believe you can’t do innovation top-down too.
You say SF is liberal (I’m not sure in what sense of liberal), but Scandinavia is very liberal too. If liberalness encourages innovation, then that might explain why Nordic areas do still innovate rather well in spite of lower monetary incentives (because it gets taxed away for social spending). I’m really not sure how much people are encouraged to innovate due to monetary incentives actually. You might have come across a TED talk, about how the more incentives you give experimental subjects, the more focused they became on a task, but it made them slower at “think out of the box” experiments? (Dan Pink, Puzzle of Motivation – not a great speaker but interesting idea.) I know programmers, and they don’t seem very incentivized by money. I know musicians who eschew money too. I think this kind of innovators (can I call them primary innovators?) aren’t really motivated by money (more by excelling in their passion/art/craft). But I guess you also have “secondary innovators” who adapt ideas for commercial application – and they’re probably well-motivated and served by money incentives.
So if both liberalness and money incentives matter – that can explain why the US is better than Scandinavia at innovation. But it doesn’t surprise me that liberalness, open-minded-ness, a willingness to experiment, to accept others who are different, is a key factor. People often say (e.g. Sir Ken Robinson in another TED talk) that children are the most creative creatures (before they’re educated out of it), because they’re so open to possibility. Nassim Taleb also talked about how US culture stigmatizes failure less than in Europe or Japan, which is why they produce more Black Swans. I’m not sure how far that’s true. I do think Singapore society stigmatizes economic failure a lot. There’s a lot of scorn for people who “didn’t make it”. There’s a lot of discouragement from parents, friends, teachers from dreaming your dreams, following your passions. There’s not enough respect for people who dream (unless they succeed – in which case suddenly you admire them).
The good news for Singapore is that urban and cosmopolitan areas tend to be a little bit more democratic than others. The crazy weird ass republican portions of America are the small towns and rural areas. So there is a lot of potential for Singaporeans to be more democratic. The bad news is that moneyed interests in Singapore are also very powerful. I feel that people have mischaracterised PAP as the enemy. I tend to believe that the moneyed interests are the real enemy of Singaporeans. PAP is just guilty of not really keeping them in check, or colluding with them. Many opposition people in Singapore don't see it this way, they're used to thinking of PAP as being all-powerful, which certainly was the case in the early years but I'm not sure now.
I don't think that people believe in fairness and equality. A lot of people still believe that CEOs should be paid 50-100 times that of roadsweepers. They don't work 50-100 times as hard, but it's OK to pay them 50-100 times as much. It's precisely because they don't believe in fairness and equality, that they are so easy to manipulate.
Well, in Singapore we really have a shadow elite. Because the press/media is so much more circumscribed, because the academy is so co-opted or cowed (just look at the Yale-NUS debate), etc, so we don’t get a lot of commentary and analysis on these things. It’s ironic and sad I live in Singapore and I have a better idea of power structures in the US than those in Singapore! Maybe it’s behind the scenes, so I am clueless, but I don’t see too much evidence of the rich wielding political influence here. What I see more of is the politically powerful enriching themselves. It’s easier for democracies to punish politicians than to punish the rich, so in this sense I think Singapore might be better off than in the US. We can vote out our politicians, but it’s harder for the US people to remove the influence of money (they can legislate to cap political donations, to increase taxes so as to reduce wealth inequality, etc – but isn’t legislation controlled by moneyed interests? Then can Americans vote out these “corrupt” legislators? Moneyed interests prevent that! You can only vote Rep or Dem, not Green Party or anyone else…).
The PAP is the enemy or not… (strange metaphor, enemy)… Actually one of the good outcomes (among many alternatives) in political change I look forward to is the transformation of the PAP. But I do believe getting more opposition seats in parliament will help Singapore get there. Mostly because we need to break the stranglehold on power, the control of institutions, etc the PAP has built (for its own benefit, at the expense of the nation) over the years. The definition of product is important to recognize here – for the PAP (and all political parties actually) the desired “product” is continued political dominance, whereas for Singaporeans it is a better future for us living here.
Re: CEOs and roadsweepers… sadly yes. I think it’s more true for the Chinese than other races. Ancient China wasn’t so different. Singaporean Chinese people have quite similar views to that rugged individual view in the US. It’s both good and bad – it leads to a good work ethic, makes people “hard-driving”, so they don’t need “spurs stuck in their hides”. It puts “fire in their belly”. But I’ve talked about the bad aspects for society a lot already. Safety nets can be more efficient. It can make life more worthwhile. It can lead to investment for long-term stable growth (health, education, infrastructure) (and I do think growth is good – just not at the expense of other important things).