Wednesday, October 26, 2011

Voters had their bite, now the employers' turn

First the voters protested with their votes; now it is the employers turn. Their scare tactic is to threaten to relocate and there will be fewer jobs for Singaporeans.

Everyone thinks only of his narrow self interest. Bosses do not care about yawning wealth gaps, public transport congestion or the rising prices of housing for the majority. They live in a different world.

Caught in between is the government, which I am tempted to call feckless but their reputation is still large and solid. So such a label appear misplaced. But the British also enjoyed a sterling reputation before the Japanese attacked from the north. To add insult to injury, Japanese planes easily sunk the Prince of Wales and Repulse.

Reputation must be QC often. It is backward looking or a lagging indicator. Past success is not guarantee of future performance since this is not science.

There is something at heart that is seriously wrong about our economic strategy. To be practical, we cannot do very much about it. It is not difficult to produce alternative economic strategies but it is irresponsible as we have no means to test if they would work. Outside of government, we do not have enough data.

I recently had an argument about the GST with a minister. He gave me the inane party line and I refused to be baited because I don't have the data needed to crunch and test. But what I know is this. The truth eventually gets out because we shall live it. People are not going to buy the cognitive. They will decide with their experience. Indirectly you suspect that our GST system even with all the helps isn't likely to create a progressive or neutral tax regime. Simply taxation is one of the key ways to rein in a widening income gap, which is not happening. 'Diary of a Singaporean Mind' article was suggestive but inconclusive as he could only make use of scant publicly available data.

Their tiresome line challenging the Opposition and citizens to come up with alternative solutions will increasingly sit poorly with us.

So what have this government placed before us? They can't make the people and the employers happy together. It is like you have two roads and they both lead to the same ruin. Fortunately the future is unpredictable. I have this hunch that the external environment would be friendly to us in an unexpected way. It had happened countless times before. However each time the government was quick to seize the credit for our success, conveniently forgetting that what was brought to solve the problems were necessary but not sufficient. Lucky fund managers making money in the markets also are equally good at explaining away their luck as skill. Professor Kahneman has a far deeper insight into this than I do. I must go and buy his latest book.

1 comment:

  1. This government is a control freak. Times have changed and people are no longer willing to let the government runs free without any check and balances. A key to this check and balance is access to data and information. I don't expect the ruling party to release their grip on data and information because it has served their self-interests very well.