Category Archives: Singapore Economic History

Had a small gathering with just a handful of high school friends late last year (still in Phase 2 reopening in Singapore anyways) and the conversation drifted to social commentary about our generation of Singaporeans and how we step forward as a society. I talked about the idea of having inherited the narratives of our parents and the boomers, gaining that awakening that empowers us to write our own story instead.

One of them brought out the point that most of the Chinese migrants who came to Singapore and whose descendents now form the majority of the population here were ‘coolies’ or manual labourers who came to Singapore to seek out employment opportunities and a better life. The mindset really was to find a boss to serve, and gain a good life through that loyalty. Life was basic and more about survival than really thriving.

Generations later, the bar for living standards have gone up, and so have expectations of how much you achieve and how much you need to live on. But has that coolie mindset changed? Are we still just trying to follow directions to a better life? Are we thinking independently and by ourselves? Are we looking to continue to use resources at our disposal just for ourselves or to make the future a better place?

This article is being read and recorded for readers here to increase accessibility of my writings and also to prepare myself to start a podcast that is currently in the works. Note that the written article is not an exact transcript to the reading.

Meanwhile, you might like to check out some really amazing recoloured photos of historical Singaporeans here. Get a sense of the hardship they went through and what life really means for them.

 

The 2018 NDP theme song is out. And normally, I reserve my thoughts about arts and music to myself and those closer around me because I claim no authority on these matters. But there is a certain excitement in my heart after watching the music video as I begin to discover why I like the refreshing honesty it presents.

[youtube https://www.youtube.com/watch?v=__pmy8a17pM&w=560&h=315]

I cannot help but see how Charlie Lim’s self-penned introduction in this remade version of ‘We are Singapore’ captures the zeitgeist of today especially in the first 4 lines, which generates the emotional connection necessary to make the last 3 lines genuine, a sincere call to action.  I want to reproduce it here:

How many times have you heard them say
The future is uncertain and everything must change
Well, all of my worries and all of my fears
Begin to lose their weight, when I hold you near
If all that we are is what we believe
Then I know I’ve got to be the change I want to see
How easy we forget everything takes time
No, nothing’s ever perfect, I still call you mine

As a matter of fact, even as we criticise and complain about the country, as we travel and learn to appreciate the cleanliness, tidiness, the sense that everything just works here in Singapore, we ought to see some of those worries and fears fade away. Not in that complacent way that we once (sort of) had, but in the manner where we restore some faith in ourselves.

In contrast, Hugh Harrison’s original introduction has it reversed, where it ramps up to a high note from a low one; which of course also reflects the zeitgeist of the late 1980s. It speaks of a confidence that we have attained after two decades of nation-building and significant growth.

There was a time, when people say that
Singapore won’t make it, but we did
There was a time, when trouble seems
Too much for us to take, but we did
We build a nation, strong and free
Reaching out together
For peace and harmony

One may be tempted to put them together and say it illustrates how much we have ‘declined’ in terms of the confidence of our attitude and tone, our perspectives towards the future. But I’d rather say we have moved on towards maturity where we now no longer struggle with the same nation-budding issues but one of an established country. Where our diversity challenges now extends beyond race or religion to wealth and/or income inequality, social classes. Where our success have brought some of our capacities (such as transport infrastructure) to its limits.

Finally, in the NDP 2018 Theme Song music video, there’s also a sense of partnership between citizens and the government. It is brought out subtly through the ordinariness of the images, the people (with a diversity that extends beyond our traditional social constructs of the various groups). The simple reverberations of ‘We are Singapore’ do away with the intentional political correctness of heavily criticised NDP theme songs over the past decade. Political correctness tends to inject a subtle atmosphere of government towering over citizens and silently observing in the background, ready to pounce at any infraction. I’m really excited that we are a nation moving on from that.

I’ve looked into growth accounting for more than 3 years of my Economics education, variously as a Bachelors student as well as in my Masters. Singapore ourselves have had to confront this issue long ago. My LSE Econs 101 Professor was the one who in many ways ‘decried’ the composition of Singapore’s growth in “A Tale of Two Cities: Factor Accumulation and Technical Change” (1992).

A relatively recent ADB paper looking over that debate with a fair degree of hindsight suggested that in the context of today’s pursuit of development, we are kind of past those considerations. The whole debate was merely transitory in terms of our understanding of productivity but had some implications on our economic measures/policy which continued till today. In any case, I don’t want to discuss the measures; rather, I want to return to the fundamentals to argue that productivity simply isn’t an economic parameter (the way population isn’t). And our obsession with it as an economic parameter results in consigning this to the responsibility of economic bodies/agencies.

Productivity as one may simply observe, varies across countries, places, organisations and contexts. Institutions shape productivity, but so do weather conditions, not just that which is produced from land but also that which is from labour. Levels of education, the content of education within the system, as well as culture – all of these shapes productivity. In fact, the conversations around water coolers, morale of a body of people – all of these shapes productivity and it’s plain to see. Do we think we can incentivise productivity in a systematic manner?

There is this strange imagination that the answer may lie within enterprises but I afraid that is seriously misguided. Government investment will probably have to take place within the education system, and to consider society and culture at large. For example, a potential area is looking at unlocking large potential in the arts – there are lots of talented artist locked up in low wage roles who would be able to generate impressive economic returns by deploying their talents into better use. At the same time, there is scope in getting the public better educated in the arts, to step up their appreciation of intangibles in life rather than being locked into a material chase. This will also help to create a small market, with which we could crowd in more demand and supply.

It is not even about values, though I must confess I don’t agree with the prevailing societal value of an obsession with material. Given that culture and education has lasting, systematic impact on productivity, why are we not placing more attention on that? Enterprises, unless they are large organization with the ability to propagate useful, efficient best practices in the economy, would be ill-placed to impact the socio-cultural forces affecting productivity.

The government have so many more levers than just the economic agencies to drive productivity growth. By classifying lacklustre productivity growth as an economic challenge, we miss out the big picture and the opportunity to help the society progress in what may be traditionally considered non-economic dimensions.

In 1992 when Francis Fukuyama published The End of History and the Last Man, he truly did not anticipate what would come of liberal democracy and the state of capitalism today. In a 2014 WSJ opinion piece, he reminds readers that liberal democracy still do not have an intellectually-appealing challenger in the realm of ideas, but the truth is that the idealism that has surrounded this political system has weakened considerably. Francis Fukuyama talks of ‘political decay’, where values of liberty and economic opportunity is eroded by crony capitalism.

While musing about the future of Singapore, and just the general lack of leadership within what I consider the ‘western world’ and adherents of ‘liberal democracy’, it occured to me that that could have something to do with being in a liberal democracy for a little too long. One of the reason for the recent lack of statesmanship in the global economy is definitely the problem of lack of leadership within individual nations; this in turn is perhaps a consequence of decades of peace, lack of outright crises or clear-cut ‘big’ problems in the liberal democracies. As a result, talents abound but their attention becomes focused on making gains for themselves rather than to secure a better future for the whole of mankind. The kind of complacency that Francis Fukuyama felt about liberal democracy as a political system was probably shared by so many people that there was no more a need to ‘strive towards a better system’.

Now back to thinking about Singapore. Are we as we are today because of the similar sort of complacency? As we see other nations & powers (and I’m referring to US and UK) struggle with lack of leadership, do we not realise that might be seeing potential versions of our future? Are our talents working to secure a better future for our society and people or just trying to make a name for themselves as individuals? Without leadership in organisations, government, business or clear direction for an economy’s development, can the human capital of our generation still be harnessed for the betterment of our people or would it be squandered? I am working on a roadmap out of this seeming rut. And I hope to find likeminded fellows who would join my endeavour.

One pondering over education and skills equipping.

What is the difference between education and training? Why is it that Einstein says that he never let schooling interfere with his education?

One of the greatest lie we tell a child here in Singapore is: “Study hard and you’ll have a bright future.” I hear it everywhere; parents telling their children, older folks telling youths, and even students telling teachers that to explain some of the sheer hours they are putting into studying. This relationship between studying hard and bright future is poorly established. And to put things a little more rigorously, there are too many countervailing factors even if this was true under a set of conditions (which must also require ceteris paribus).

Academic speak aside, there is the element of competition that we must deal with. We have been creating competition where there isn’t a need to. Competition in life is real but instead of teaching our kids how to conform and play the same game, we should be encouraging them to carve a niche for themselves. In forcing everyone into the academic game, focusing resources on these people, we are implicitly coordinating the entire society into just a single pocket of niche which makes us incredibly vulnerable. We often claim that we don’t have land nor any natural resources – our primary resource is our human capital. Yet by forcing our domestic human resources through a narrow funnel we have created increasingly fragile economic growth that critically depends on a constant inflow of foreign labour (to take care of all the other areas of life and economy that we have neglected to cultivate and groom people for).

Next we need to deal with the connection between our ‘training system’ (note: I don’t consider the bulk of our schooling years education – in the same spirit as Einstein), and the kind of talents needed in the world is severely disconnected despite good intentions. There is overemphasis of quantifiable, hard skills and lack of attention paid to other equally important soft skills, as well as character-building (which is really what education is about) that will help to build our next generation up to deal with challenges in life and adversity at work. In other words, training must be better aligned – schools have come up with their own standards and nice-sounding principles without really consulting the other stakeholders. When was the last time schools ask parents and the industry how they can partner these other stakeholders to develop better programmes to build up students?

Lest you think that I am putting too much hope in our schools, we still have to deal with the whole question of ‘education’. All the talk about character-building a decade ago is gone – focus went back to all the quantifiable stuff. The more centralised decision-making becomes, the more demand it puts on quantifiable elements, the more resources allocated to fact-finding, data-gathering and the more buffer we build between layers of hierarchy in reporting – the less contemplation takes place. We discovered long ago that centralised resource allocation is problematic but we also have to contend with the problem that governments who inevitably grow large over time. A mechanism to break it back down is necessary. I think education holds promise for something like that. The more we decentralise activity down to the individual schools, put less roadblocks, make principals and teachers more accountable directly to parents and industry rather than the ministry, we will be able to start growing a new kind of workforce to fill the needs of our economy.

While it might be attractive to think that the ‘government’ could coordinate lots of stuff and make magic happen, the truth is the needs of the people are simply distributed, and relies too much on micro, local knowledge for a centralised bureaucracy to handle.  The amount of reporting, verification, and layers to clear before initiatives are implemented squanders a lot more resources than necessary. At the same time, matters are complicated by the need to constantly justify being ‘big’ through securing public support with big goals, big initiatives. Historically, we have made big gains by agglomeration, growing huge and becoming big. But the gains we accrue from such centralisation and consolidation is bound to erode at some point. At the same time, coordination becomes much more difficult and incentives becomes increasingly skewed as those decision-makers are well insulated from the ground and what really happens.

One dissecting the culture, the tiny traits that we need to consider and intend a mindset shift when deliberating policies.

In some sense, I have already written this article, in Culture of Competition. But I thought that rather than prescribing things, I want to think through the culture that has been created over the years a little bit more. I am not trying to be definitive but just to kickstart some thinking along this dimension where few have bothered to tread meaningfully other than to conjure some social critique or unconstructive sarcasm.

Harking back at the article I have written, I must applaud some of the qualities Singaporeans generally have:

• Largely rational
• Results/outcome-oriented
• Generally hardworking

These qualities also make us very operations-oriented, tending towards the side of being skeptical about abstractions and theoretical matters. This perhaps relate to our slightly more simple, non-scholarly ancestry, particularly for the Chinese. We don’t generally try very hard to translate theory into practise, choosing instead to ideate on practise in a separate, parallel track. This is related to our constraints of being a small country without much resources so the lofty thinking always must be kept apart from the practical considerations lest those executing lose heart when they know of the longer term strategy and plans in place. Unfortunately, along the way, I think we easily and quickly lose sight of the ‘meaning’ because the much longer term ‘why?’ that truly was driving the shorter term ‘how?’ was lost in the process.

Happiness, Prosperity & Progress
We want to thrive, not just survive. We want to be happy, we try our best to learn to be content. And because our thinking habit tend to deal with the practical bits at a separate, albeit parallel level, we orientate goals towards careers, grades, social recognition, paycheck, without establishing the proper linkage with the notions of thriving and happiness. We fail to be rigorous at the last mile where it matters.

Or, to put it in public service terms, we may establish that foreign direct investments are strongly related to job creation, knowledge transfers; and that direct investment abroad generates strong backward linkages that enhances our human capital, diversify our risk portfolio. And we may even manage to establish that job creation, knowledge transfers, enhancement of human capital and risk diversification generates greater economic growth (in terms of growth figures), promotes economic stability and robustness (in terms of volatility and fluctuations in growth rates). But how are all of these related to happiness, prosperity and progress of the nation (ie. the people)?

Our response to that had been to repair the pipes, to make sure that the value that flows from FDIs are connected directly to job creation (perhaps through application of conditional tax incentives), then possibly even tying them to jobs of citizens so that the various discipline’s graduates do indeed become employed after university (prosperity, checked). When Singaporeans are dissatisfied with jobs, then the question becomes what jobs they want and the public service is rallied to create those jobs (happiness, checked). So our new generation is better paid than the previous and also enjoy access to better quality of life (prosperity, checked).

Meaning & Purpose
So what is wrong? We have confused the ‘sense’ of happiness, prosperity and progress with what they really are. We cannot guarantee that everyone in the nation can have all 3. So what does it mean if one group has all 3, another few different groups have variation of one or two of them? Did we pass our key performance indicators? To ask that question is to miss the point totally. And that is what we are suffering from, having dupe ourselves into focusing only on the hard stuff – on the tangible, specific, measurable goals.

Our culture suffers from a void of meaning; the finger-pointing from dissatisfaction with job, government, friends, the world, have much to do with our inability to create meaning in the first place. Purposes are dictated by others – your teachers, parents, nanny, government, boss, system. Yet there is no process or upbringing that help us relate our concrete actions and our daily thoughts and deeds to those purposes. This void of meaning underlies the sense of entitlement (or strawberry generation), the disillusionment of the previous generation who have worked hard, the gloomy outlook.

Meaning matters, yet we are so desperately skeptical of its role in our lives. We sink into the unproductive ‘complaining spirit’ when we should be encouraging each other and reinforcing more positive self-talk. The power of meaning to shape behaviours radically is abused. Edward Hess recounts this story for his MBA class at Darden School (University of Virginia):

An entrepreneur was in the waiting room of a heart clinic, having waited for 5 hours and checked in with the nurse multiple times only to be reminded they will eventually attend to him each time. At some point a cleaner came into the clinic with a mop, brush and bucket of water. The entrepreneur watched and observe the cleaner in the heart clinic – he was so conscious of his job, kneeling down to scrub the floor of dirt when he sees them. The entrepreneur knew a thing or 2 about building maintenance and the hard work, having grown his business through developing and providing facilities management for commercial buildings.

He went to the cleaner and asked “I’ve never in my life seen a cleaner work like that and I wouldn’t imagine myself cleaning like that? Why is it that you do what you do the way you do it?”

The cleaner answered “Doctor Brown is in the business of fixing people’s hearts. And I support him by making sure this clinic is free of germs because germs does bad to people’s hearts.”

We may not be cleaners but we can connect with what he said. We know at the back of our minds the larger role that our job and tasks are playing. But we have doubts whether they actually achieve that ultimate bigger picture. We need to be less self-absorbed that we may shift our focus away from the dreary and come to see it hand-in-hand with the bigger role that our work plays in the lives of others and the whole economy.

Tiny Traits
I’ve taken a really tiny small thing and blow it up to make it big. Meaning by itself is tiny even if it underlies many things. But this would have incredible impact on a multitude of things. When we engineer policy that is supposed to create mindset changes, we need to think about the culture that will be created by the policy, and not just try to manage the culture through the process that is tied to the policy.

Then consider whether the culture spin-off is actually in line with our greater vision for the future (which I briefly mentioned in the first original article on Labour Perspectives). For all the stakeholders down the chain and the target audience, we need to ponder over what the deliberated policy really mean for each of them. Or are announcements for various packages, initiatives just times where various parties pounce on the public sector and try to see if there’s anything in for them? That is just one of the tiny traits borne of the void of meaning, together with many others including the complaining spirit characteristic of Singaporeans, the sense of entitlement we observe.

I’ve a while back embarked on starting a research on some of the history of the intellectual engine behind Singapore’s growth. There is a general attribution to the government’s brilliance but it is essential to trace these back to institutional roots and the people involved – without understanding the process by which economic progress is made and considering the values that brought about them, our generation risks forfeiting what our forefathers worked to gain. The sort of circumstances that created our forefathers and the system that they created for their subsequent generation was the main focus of my next stage of research.

I foresee it leading on to more interesting stories about manpower in Singapore and narratives about the labour force. While I was on my way to the airport last week for a work trip, I came across a cab driver who looked like he was in his 50s, claimed to have been driving a Comfort cab for over 20 years and couldn’t stop complaining about a variety of different things. I struck a conversation with him which went from one which went from price of print newspapers to the taxi/cab industry in Singapore. Most times, in taxis and where mature Singaporeans congregate, I sense negativity, but conversations which concluded that there wasn’t much to do. Helplessness, lack of choice features a lot. Implicit beliefs about status quo and the difficulty of challenging them, even within ourselves is hardly addressed. The desire for comfort individually is not quite thought about (by the government) in trying to restructure our labour force. Even when the government is promoting jobs creation for Singaporeans overseas, they don’t seem to realise that those who would like to take up jobs overseas are already actively doing so and currently the ones left are people who need a tad bit too much nudging to get out.

The alignment of policies with socio-economic forces are important. That in part determines the success of policies – especially in the case of our early population control measures. Yet today we need increasingly creative solutions to go along with the socio-economic forces and yet steer it towards some longer term vision rather than pure reactive fire-fighting. The labour market is a key market that we still have a little bit more influence over. How we want to manage it will be one key factor for the growth of the country and our culture. I’ve already mentioned a while back that the soft stuff are the hard stuff. The government needs to start getting into the business of handling the soft, non-quantifiable stuff and pulling together the stakeholders who wouldn’t normally come together in the marketplace to make a difference.

Given the current makeup of our workforce and our skill sets; without radical culture change that goes beyond sticks and carrots, we will need to go through a period of convincing people to get out of their comfort zone. We don’t need compensation for the pain we will take. What we need is a vision and motivation, encouragement towards that vision. That vision is absolutely lacking – or poorly communicated if it exists at all. We need to trace our success in creating a labour force that worked and use that to chart a path towards that vision that we will formulate (or is formulated but perhaps too bold to be revealed in its full glory).

And with that, I plan to write a series of 3 articles. One dissecting the culture, the tiny traits that we need to consider and intend a mindset shift when deliberating policies. One pondering over education and skills equipping. Finally one that muses about the needs of the economy that we are shifting towards.