Future generations will pay for the sins of PAP
SGPOLITICS.NET
Written by Ng E-Jay
06 July 2010
I wish I could come up with a more optimistic pronouncement. But
this is the most honest assessment I can make: Future generations
of Singaporeans will have to pay for the sins of the PAP if
something is not done about the present situation.
Let me state quite frankly that I do not deny that Singapore has
made huge economic progress over the decades under the PAP’s watch.
As some of my friends would point out, however, much of the growth
could have come about not because of, but in spite of, PAP’s
policies.
Singapore is situated in a very favourable geographical
location, and even though advancements in transportation technology
over the decades have eroded our geographical advantage slightly,
it cannot be denied that our prime location at the southern tip of
the Malaysian peninsula has afforded us enormous leverage as far as
trade is concerned.
When the PAP came into power in 1959, Singapore was already a
bustling metropolis, not a sleepy fishing village like National
Education textbooks like to put it.
When we achieved complete independence and sovereignty in 1965,
the foundations for our future economic success had already been
laid. Investments were already pouring in and our industries were
already being rapidly developed, despite the racial turmoil and the
communist threat that existed at that time. All this was happening
at a time when the then Prime Minister Lee Kuan Yew was occupied in
a power struggle with the Tunku.
I do not know whether the PAP made things significantly better
after 1965, but I do know the PAP managed to make things
significantly worse at some point in its reign.
The PAP’s first major policy blunder was its “Stop At 2″ policy
which it introduced in 1969 in an attempt to curb Singapore’s
rapidly expanding population, which was then seen as a serious
threat to Singapore’s long term growth potential. Sterilization
policies were progressively liberalized from 1969 to 1974. By 1977,
21 per cent of women of child-bearing age in Singapore had been
sterilized. [1]
The PAP’s error in this policy was in going overboard with it.
The repercussions would later come back to haunt future generations
of Singaporeans.
The pro-eugenics policies of the PAP culminated in the Graduate
Mother Scheme which was implemented in 1984. Graduate couples were
provided with considerable financial incentives to have more
children, the rationale being that children from graduate couples
were more likely to be intelligent and would grow up to be more
economically productive. However the scheme was scrapped after a
few years when the horribly discriminatory implications of the
policy gradually dawned on the electorate.
By then, of course, the damage had been done.
All developed economies eventually enter a phase when their
birth rates start to decline due to evolving social attitudes and a
higher standard of living.
In Singapore’s case however, the policies of the PAP greatly
accelerated the process and made the inevitable come much sooner
than would have been the case had the PAP not gone overboard.
A decade after the demise of the Graduate Mother Scheme,
Singapore’s Total Fertility Rate had plunged to a mere 1.3, far
below the replacement level of 2.1 that demographers insist is
needed for a population to sustain itself.
This prompted the PAP Government to open the floodgates to
foreigners to shore up our population base. Of course, a
sustainable population base was not the only reason given by the
PAP for doing so. The PAP told the electorate that foreigners were
needed because they brought skills and expertise that Singaporeans
lack, and their numbers were needed for continued economic growth.
For every job which went to them, we were told, more jobs would be
created for us citizens.
In more recent times, the electorate was told that Singapore
would go the way of the dodo if foreigners were not imported in
large numbers, and that Singaporeans should accept this because we
are less hard-driving and hard-striving than foreigners.
[2]
However, because PAP’s policies have led to an indiscriminate
and uncontrolled import of foreigners, some of whom do not seem to
bring in new expertise or skill sets over and above what we already
have, wages at the lower end of the spectrum have been suppressed,
bringing hardship to the lower income. This indirectly leads to
suppression of aggregate demand from one segment of the population,
which in turn depresses overall economic activity.
It should be noted that unlike countries like Hong Kong and
Taiwan, Singapore did not quite have a roaring comeback after the
previous two recessions. Perhaps part of the reason lies
therein.
The rapid import of foreigners has also created strain on the
fabric of our society, with more than a few openly voicing their
concern whether the newcomers will make a serious effort at
integrating into our society and embracing local social norms.
The larger malaise confronting us, however, is not just the
rapid influx of foreigners, which the government has realized only
this year must be more tightly controlled.
The economy is being systematically hollowed out, milked for
what it is worth. The economic path we have embarked on is
unsustainable. Our future growth potential is rapidly being drawn
down in a misguided attempt at boosting our GDP figures and
justifying ever increasing public sector and Ministerial
salaries.
How is the economy being hollowed out?
Singapore will probably see several years more of good growth
and perhaps even rising incomes in the middle and upper
classes.
But the distortions in the economy created by PAP’s policies
will also lead to periodic asset bubbles, especially in housing.
Asset bubbles are very bad for a country, and even worse for a
small country like Singapore.
Not only do asset bubbles lead to mis-allocation of capital,
when they inevitably come crashing down, many people get hurt badly
in the process.
We see this each and every time the property market here takes
off and goes to the stratosphere, only to come down to reality
several years later, leaving in its wake hordes of homeless
citizens who have been chased out of their flats because they are
unable to service their mortgages.
After the PAP has milked the Singapore system for what it is
worth, I fear that future generations of Singaporeans will be faced
with a hollowed out economy and slow growth rates that will not
match their expectations. I fear that many people, especially those
just embarking on their careers, will not be able to afford to
retire peacefully when they grow old. They will be faced with an
overcrowded city, lack of job opportunities, rising inflation, and
poor economic prospects.
I am very tempted to try to alter my prognosis so that it does
not sound so pessimistic. But to do so would not be honest. In my
sincere assessment, if Singapore citizens do not stand up and take
charge of the situation now, future generations will have to pay a
heavy price for the sins of the PAP.