Category Archives: Anecdotes

Mandates vs voluntary action

We all want to make the world a better place. And in Singapore, we’ve somewhat cultivated the idea that we need to force people to take the right action or they won’t. Often it is because they will point to others who have not done it and say ‘why don’t you ask them?’

The people who failed to bring their trays back to the shelves at the hawker centres before NEA’s mandate had excuses – they were busy, the cleaners had to have something to do, they forgot, and so on. But it was never clear enough that they ‘had to’ do it. Once the mandate and the penalties came, it was clear. As clear as day. So, mandates make requirements clear to a large extent. It makes people sit up and recognise they had to take some action. More so than the consequences of dirty hawker centers, or when you have to take over a messy table.

What can we learn from this that we can apply to climate change?

If we don’t feel hit by the experience of a messy, unclean hawker centre, it is even harder to feel like we need to take any particular course of action just because we have a few more hot days. After all, one could turn up the air-conditioning (which worsens the problem at the system level). So mandates are needed to help with the coordination. The direct consequences alone are insufficient because of externalities, so the government should step in to ‘make them feel the pain’.

Addicted to speed

I’ve taken to riding the bicycle more frequently and in the beginning, I’ve often sought to ride really quickly and reduce the time spent between points as far as possible. I basically wanted the bike to be almost my teleportation device. And the reason I preferred it over public transport was not just because it was cheaper, but that I could control where I wanted to go, and when – up to a certain extent at least.

But what is interesting is that I observed even if I was going at very high speeds, my commuting time hardly changed all that much. A couple of seconds, handful of minutes sometimes, but it requires you to maintain a high speed over long segments of the journey which may not be easy to achieve because of terrain changes, and need to navigate traffic.

And I thought about the formula that we learnt in Primary school:

Distance = Speed x Time

And if you rearrange it, then you get

Time = Distance/Speed

So, assuming the distance is fixed for every journey, the only way to reduce the time spent is to increase your speed. But because it is the denominator, if your speed is already relatively high, the amount of time you can reduce by increasing it by a little is really minuscule and perhaps often not worth it. And as a rider on a bike, you could probably calculate how much energy you need to exert to achieve a particular speed over flat ground, and work out the optimal trade-off between energy and speed that will provide a suitable time for your journey.

If you substitute distance for anything else; such as work to be accomplished, or widgets to be produced, and so forth, you recognise that the principle that applies to speed remains the same. There is only this much the rushing would help you reduce the time spent. The excess energy put into rushing will have diminishing marginal returns and it would probably be squandered, and you find yourself drained significantly just to reduce the time when perhaps that amount of speed is not necessary.

For a Singaporean like me who tends to be impatient and wants things to be fast or rushed, grasping this principle is quite precious because it forces you to recognise the limits of using your energies to rush things and compress time. There is a natural limit to it, and we probably ought not to try too hard to challenge that limit. Even if you encounter someone unreasonable who tries to compress it further, you would do well not too be too caught up with their attempts at squandering excess energy to pressure you. Allow this insight, this understanding to dissipate their pressure and negative energies on you.

Character development in sports

Continuing my series of musings about the nexus of sports and life. Something more important than winning in the sports arena is that your character is being built. How do you measure the extent of character development? What am I thinking about exactly? And why does it matter?

You can’t measure character. It doesn’t mean it is not important but you just cannot measure it. In the film Les Choristes, the Maths teacher, Mr Mattieu, formed a choir believing it would help reform the badly behaving boys. And it did! But how do you measure it? What changed? Maybe the school grades, maybe the noisyness of the classroom, perhaps even their sense of aspirations. In sports, the players’ performance can be seen in their behaviour on the pitch or courts, as well as their scores, but perhaps also in their lives, the way they treat the people around the sport, and so on. Even how they treat their competitors and how they talk about them. Max Maeder, the Singaporean kite-foiling Olympic medalist, impressed everyone by giving kudos to his competitors after finishing third in his final race when asked to comment on the race.

So that’s what I’m thinking about. There’s something unmeasurable that we can achieve in sports and sporting culture. Are we going to invest into that as a nation? Do we care enough about our people’s lives and their mental fortitude, resilience in face of struggles, competition, and need to perform? Those are precisely what sports offers us an opportunity to train and build up. And so investing in sports is not just about shiny stadiums, sport science degree programmes but also providing athletes with sport psychologists, equipping athletes with the science involved in training, practice, self-care and so on.

An excerpt from Roger Federer’s commencement speech for the graduating class of 2024 at Darthmouth this summer:

In tennis, perfection is impossible… In the 1,526 singles matches I played in my career, I won almost 80% of those matches… Now, I have a question for all of you… what percentage of the POINTS do you think I won in those matches?

Only 54%.

In other words, even top-ranked tennis players win barely more than half of the points they play.

When you lose every second point, on average, you learn not to dwell on every shot.

He could be considered perhaps the most long-running, persistently successful individual athlete of our times, and the lessons he can draw from his experience are timeless. If we could have more of such models and examples to train, motivate, and encourage our next generation of Singaporeans – for their lives not just in sports but other aspects, won’t it be great?

Persuasion vs argument

I was having coffee with a friend yesterday, and the conversation went on about having disagreements at the workplace, particularly when there are also some kind of philosophical clashes.

I reminded her that too often, we try to get others to do what we suggest by being right, by arguing for why it is the right way, or how our proposed approach would be the best. Or why the alternative proposed is ‘wrong’ or suboptimal. The merits of the approaches in and of themselves can make for endless arguments. Because that exercise on resolving disagreements become one about tossing perspectives and viewpoints around.

There are a few key ingredients needed for resolution of such matters:

  • Some deadline for making the decision
  • Aligning expectations that the particular discussion outcome needs to be a decision and not just a plan to discuss more of it
  • Set aside time to argue for the other side; when you are forced to argue for the other side, you reset your thinking

Another thing we tend to forget is when there’s a disagreement, sometimes it is not about pointing out pros and cons about the approach or subject matter at hand. Often it is more of a persuasion, on how that approach of way of handling things would benefit the counterparty personally or their ‘side’ of the matter. The more we think of the discussion and conversation as a matter of persuasion rather than proving something, the more we allow ourselves to be flexible and think from the viewpoint of the person we are trying to persuade.

It also takes the ‘I am right and you are wrong’ dynamic out of the room.

Compelling stories

I was reading Morgan Hounsel’s Same as Ever and one key claims he make is that compelling stories are probably more important than well-researched, time-tested facts or truths. The challenge is that people would find it easier to believe, and digest compelling stories than truth that might be hard to swallow.

And this probably comes from various different ‘incentives’ that are at work including socio-cultural incentives (relationships, perceived or otherwise), compelling financial incentives but also some kind of psychological incentives relating the way the pieces of information somehow resonates.

To some extent, it is beautiful that humans are wired this way. We are not some hard calculating machine that spits out answers in binary form or just goes into system error and choke up in smoke. There’s something poetic in the manner we appreciate and take in information, work them in our minds. Yet it is also responsible for crippling us and causing us to go down the wrong path in terms of decision-making, and coloring our behaviours.

The challenge is we can’t quite help ourselves. Even when we know we are biased, we somehow fail to control for it appropriately. The fact we managed to get as far as we did is rather miraculous. And probably stands testimony to the fact that while as individuals we might not be that successful, we’ve managed to develop systems larger than ourselves to deal with some of those issues. And those challenges are not as fatal as long as they are not being synchronized somehow.

The risk is when we all keep converging towards the same false compelling stories. Or when we collectively as a society discriminate or eliminate the outlier types who tend to be more capable at cutting through bullshit.

The Singaporean

I grew up with a sense that the stereotypical Singaporean is reserved, quiet, unquestioning, and silently observing, taking notes, figuring out the rules, and conforming to them. He tries not to stand out too much or to speak too often, but when given the chance, he speaks, perhaps not too freely. He tries to press or push his point when the time is right but not too hard.

Yet time and again, I meet with Singaporeans, in Singapore or overseas, who challenge that view. The stereotype ultimately serves as a caricature of cherry-picking some of the behaviours that others have observed and found peculiar but not quite converging into any one single individual. Perhaps that is the nature of stereotypes but maybe it is more important to consider what is the narrative behind that stereotype.

The narrative I grew up with was probably one of smallness, the sense that we are trying to catch-up and, play fast follower, not trying to be ‘too smart’ and just aiming to be good based on the prevailing rules and norms but not carving out our own category of what being good or being the best means. Yet in perpetuating these, we’ve inadvertently created a category for ourselves, and uniquely positioned ourselves as Singapore. Maybe it is good to be more confident and to actually work hard, push ourselves not as a function of fear (whether it’s fear or losing or falling behind), but as a function of the recognition this is what got us here and will get us to further heights.

This message perhaps came in a bit overdue but Happy Birthday Singapore.

Human resources and sustainability

The world is getting impatient. For results, for success. And corporate training for employees have become shorter; often so short it is non-existent. People and companies are pressing for results and when they do spend, they want the results immediately. And the quality of HR suffers; they are just trying to sift the market and find the talents to hire. Those with experience but are not capable will no longer be able to find work when they are planning to switch. That’s if they are not made redundant yet.

The ones who are inexperienced may find themselves somewhat discriminated against. But if they prove themselves to be capable, they’ll be able to move pretty fast in the private sector. The market will reward them richly; but rarely would companies incentivise them to help train up more people to be like them. Companies would just want to get them for their performance. And drive their results with better rewards and compensation.

Is this sustainable? I’m not sure. I personally don’t think it is going to work. Because the ones who are capable would rise and then eventually grow bigger than the organisations themselves. Or if they are actually keen on upskilling and developing people, they might move out and start businesses themselves because existing businesses out there are not really rewarding employees for developing others and fostering better work environments. Why so? Because collective results are hard to properly attribute to these champions. It is easier to attribute individual results; or allocate achievements to specific individuals.

Scientific management is showing its cracks. I’m not sure how long it will take to manifest in company valuations and the reputation of companies.

GST hike & discounts

As we move from 2023 into 2024, Goods & Services Tax (GST) in Singapore will rise by another 1%. Given the prevailing rate is 8%, the 1% rate increase is actually a 12.5% increase in the consumption tax. No doubt companies will try to convince you to buy stuff before 31 December 2023 to benefit from the lower GST, rather than wait till next year. And if we were to project this logic forward, knowing that GST might eventually be 10%, there is a question of whether we should bring forward some of our purchases even more.

This is more of a psychological trick than anything. Take for example, your interest in an iPhone that may cost you $1000. Buying it before end of the year will save you $10 at the most because of the 1% additional GST that you will need to pay next year. That is hardly a ‘discount’.

Let’s say you got 10% discount from a Black Friday sale instead. Would it compel you to change to a new model rather than stick to your old one? You might. But what if instead of using your existing phone for 1 additional year (eg. 3 years instead of 2 years). If your original phone was also costing $1000, you’d effectively get a discount of 33% just by using it for 1 additional year. Obviously, it goes down if your base time length is longer.

But you get my drift. The biggest discount is when you can use your goods for longer and get more life out of it. There is no point chasing after lower prices of new goods upfront if you keep replacing them quickly. This is an element where sustainability on the consumer end actually lines up with economics but the challenge is psychology.

Who is the polluter?

There was a recent piece on Eco Business about Singapore’s packaging recycling scheme being delayed and how the polluter-pays principle seems to have failed to take hold in this particular situation. It was partly because of a speech by an activist in the recent SG Climate Rally.

The principle of polluter-pays is important because it helps to internalise the social cost of pollution and allows the market to price it in correctly. The result would be that the production and eventual consumption of the relevant goods stays at the level which is socially optimum.

Product packaging is itself a massive problem where it is clear certain social costs of the waste production is not properly internalised. The fact that supply chains are such that buying a new product is cheaper than the refill version, and the fact that massive amounts of materials are used in packaging without producers having to foot the cost of disposal, seems to be an issue. But the situation is also because waste management is not properly priced. Today, in Singapore, the amount of cost you shoulder for waste disposal is based on where you live and the type of dwelling you live in rather than the amount of waste you generate. This in itself is already not exactly adhering to the polluter-pay principle.

Creating a plastic bottle or aluminum can refund scheme would also jack up the cost of the products but sometimes we forget who are actually the polluters. The ultimate polluters are still the consumers and in making our purchase decisions, if we recognise the cost to the environment and decide that accordingly, it changes the dynamics of the situation and allows the producers to ‘suffer’ the cost from the lack of demand despite the low-ish prices. But that still doesn’t produce a very reliable signal in the marketplace. And that’s why it makes sense to properly ‘tax’ the producers or the consumers somehow to get the market back in line.

As it turns out, the identification of the polluter does not matter much. What matters is that the associated product gets the pollution priced in somehow. You can charge even the shops that are stocking the products. The reason is that the cost will reverberate through the supply chain; the higher price will result in less customers buying it, sending a demand signal that reduces the orders and stocking by the shop, who will order less from their suppliers and so on. Eventually, at the default price point the producer will realise the market isn’t taking as much of the product that they are producing hence reducing their production and hopefully the pollution as well.

The tricky issue is pricing the pollution and getting a sense of how much the marginal reduction in production could reduce the pollution. This is tricky because the average pollution per product isn’t the same as the marginal pollution. And indeed you may have to curb consumption/production very drastically in order to reduce a bit of pollution if there is significant non-linearity involved. I won’t go into the mathematics here but suffice to say, there is reluctance to tinker too much with the pricing of more ‘ordinary’ consumer goods in Singapore. And it might be a shame for sustainability.

Electrification tussle

The more I observe the energy transition in Australia, the more I realise that its attempts at balancing many different principles and ideas are at odds with achieving an orderly transition. Too often, we cast the energy transition as a technical or economics problem but more often, it’s a policy and political science problem. At the heart of the debate, is the age-old welfare economics issue around winners and losers. And with lobbying, power plays, risk of job losses, and a mix of various different studies, academic and commercial contributing to various perspectives, it can be incredibly confusing for policymakers.

Having worked on the side of government and alongside policy makers when I first started my career in Singapore, I thought that the volume of noise that exists in Australia around the energy transition is startling. I recalled that there were a lot more ‘no-brainer’ type of policy directions and being in the government was a lot more about trying to steer a large, heavy ship towards the destination that we can more or less agree on. In Australia, it almost feels like the policymakers are simultaneously being pulled in a hundred different directions at the same time and trying to achieve it all.

If, at this point, we are seeing that the policy direction is towards electrification, then the actual effort will have to be looking at what can green the grid and focus on that. So there’s been funding towards more solar and wind, as well as batteries to help balance the load in the system. The next big challenge is grid stability and network capacity. This will require extremely large investments and infrastructure build-up that will take time. This means we cannot electrify everyone at the same time, and this phase-in of various functions being electrified will have to be determined and planned carefully. The risk of not working this out is high – the greatest being continually being held hostage by the coal-fired power capacities and unable to shut them down to green the grid because power demand is climbing faster than we can build the grid and renewable capacities.

Gas is a transition fuel for precisely this reason; and it can play its role in the transition in two ways. First, it continues to supply energy to industries that need heat, delaying their need to electrify and hence keeping power demand at bay. Second, it can provide peaking power and supplement or displace coal-fired power in baseload, playing a critical role in taking the most carbon-intensive power source off the grid. Yet this brilliant idea keeps getting drowned out by the fear that once the gas industry is entrenched, it won’t go away. The economic lifespan of combined cycle gas-fired power plants or open cycle ones is about 25 years though their operational life can be extended. This means that they can be introduced immediately and fired up to replace coal-fired power plants and the tail end of their economic life can be more for peaking uses to stabilize the variable renewable energy, deferring investment in batteries that have significant lifecycle carbon emissions themselves.

The earlier we cut coal, the better; by allowing gas-fired power generation, we also defer the need to scale up our network capacity quickly when the electrification drive advances. These actions can mutually reinforce each other and allow battery, wind, and solar capacities to enter the system gradually alongside network upgrades. We observe how energy cost on consumers have increased while trying to green the grid (levellised cost of electricity from solar and wind is not a strong measure given that they are not produced when needed); trying to force the electrification is not going to make things better. Coupled with the strong anti-gas sentiments would only mean costs will keep going up.

Part II of this article continues tomorrow.