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One of our best thinkers and one of our biggest hearts, sees only BAD from LIEgime because it has stratified itself into dead end policies

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  • Robert HO
    Diary of A Singaporean Mind Wednesday, October 27, 2010 Khaw Boon Wan s $8 bypass....
    Message 1 of 1 , Oct 28, 2010

      Diary of A Singaporean Mind

      Wednesday, October 27, 2010

      Khaw Boon Wan's $8 bypass....

      Khaw Boon Wan is one of the most well liked ministers around.....maybe because most people haven't been means tested or had a severe illness not covered by insurance.

      In a recent posting in his blog (mohsingapore.blogspot.com), he wrote that he paid only $8 for his recent bypass. $8 is not even enough to buy a ticket for the movies these days. Recall that Minister Khaw's condition was detected through an expensive calcium test[Link] which ordinary folks probably don't take....so if they have the same condition as Khaw, they probably won't find out about their heart condition until they have a severe heart attack. The reason Minister Khaw paid only $8 because he is covered by both Medishield and a private insurance plan. This is strange right? I really wonder why minister who is paid millions in salary per year needs to supplement his Medshield with a private plan. If Khaw as a millionaire minister finds Medishield inadequate and supplements it with a private insurance plan, what does that say about the Medishield?! These private plans can cost $2k-$3K or higher per year depending on your age and health condition.

      Singapore's healthcare system has to be always compared with the those of other 1st world countries. We are definitely better than most developing countries if you're not too poor to afford it. If you look at the % of the healthcare burden shouldered by individuals (vs govt expediture) it is the highest in the developed world even higher than the US which had a healthcare crisis that had to be fixed. Our system is not universal:

      "We have been particularly effective in reducing the % of uninsured young Singaporeans, from 45% in 2007 to 17% in 2009" - Khaw Boon Wan [Link]

      In the US when they debate the severe healthcare crisis of a 'large' number of uninsured Americans, they number they were talking about was 15.4%[Link]. For a developed country, our uninsured population is huge. After Obama's healthcare reform, Singapore will be the only developed country without universal healthcare[Link].

      When I read Minister Khaw's blog, I'm very happy that he acknowledges that more needs to be done:

      "........ especially in extending MediShield to include mental illness, congenital illness and neonatal treatment. There were also comments on raising the claim limits on outpatient cancer care, so as to relieve the burden on cancer patients. " - Khaw Boon Wan

      I wrote about coverage of children with congenital illnesses many times in my blog and it has been the topic of much debate over the past years. If the system does not take care of Singaporean children who are born sick, can we ever say the system is good? The reason the govt doesn't do this is simply because it doesn't want to allocate money to solve this. But what is lacking in govt is not money but heart. Perhaps Minister Khaw has his heart at the right place because he at least recognise that this is something that has to be fixed. However, he belongs to a political party that leans too far to the right whose basic philosophy is to shift as much burden as possible to the sick and their families. It has been many years, many babies and many parents who struggle to provide care for these children with little help from the govt. The money is there ...we are not a poor country. But helping sick babies is too difficult for this govt to do - we need to wait, debate and ponder over it for decades.....but there are no big deal to just spend $387M on a sporting event or lose a few billion in western banks or spend money on expensive military hardware that has little relevance in a world where the threats have changed from all out war to low intensity conflicts. Minister Khaw needs to ask for more budget to cover those who have no insurance and take care of those who are now left out by the system. ...if we treat healthcare as important as defense, we can only get stronger as a nation because ultimately when the time comes and we are called to serve with our lives, we will remember how well we were taken care of in our time of need.

      Tuesday, October 26, 2010

      SGX takeover of ASX faces political opposition...

      SGX offer to buy ASX for S$10.7B looks like a good financial deal for the Australians. SGX is paying a huge premium of 37% above the price based on AGX's current stock market valuation. This reminds me of SingTel takeover of Optus which proved to be drag on its performance for many years. The new CEO of SGX perhaps feels pressured to impress with a big move given his other ideas like getting rid of the lunch time, high frequency trading and introduction of black pools have not been well received. The previous SGX CEO brought in many (sometimes crappy) Chinese companies known as S-shares which was great for SGX and its stakeholders i.e. brokerages but sometimes painful for small shareholders of S-chips. Singapore companies have had a number of major takeovers of foreign counterparts more often than not the outcomes are not positive especially so when Singapore companies overpay - what comes to mind are Shin Corp, Americal President Line (by NOL) etc.

      The ASX deal is opposed by Australian politicians who view the Singapore political system negatively:
      "Singapore is a state that tramples all over freedom of speech, democracy, the rights of oppositions, the ability for public discourse," -Greens leader Bob Brown told Dow Jones [Link]
      “(They) don't respect this nation in the way they should, they don't respect our aspiration for a more democratic and fair society, and have a poor track record in regarding Australians as equals." - Green leader Bob Brown
      "I have a desire some things in my country are left owned by my country. I do not wish to live in a country of serfs working for foreign landlords," - Independent lawmaker Bob Katter [Link]
      I think the deal is likely to be derailed given ASX is an Australian monopoly and it is clearly against their national interest to have it under the control of foreign company. Singapore political system is viewed as unacceptable by certain Australians politicians and they cringe at the thought of Singapore companies coming in to dominate various business sectors because of PAP's lack of respect of human rights and undemocratic ways. Bob Katter worries that such invasions by "foreign landlords" will result in a country of serfs working for foreigners. In Singapore we get to hear PAP's explanation that foreigners will create jobs for locals and there is nobody as powerful as Bob Katter around to warn us that we might turn into serfs in our own country and stop that from happening.

      Monday, October 25, 2010

      PMETs and cohesiveness in our society.

      I'm overseas and getting access to the Internet is not so easy in some places. A few days ago on the 19 Oct 2010, I wanted to post something on the 4th anniversary of the Wee Shu Min incident [Link] but couldn't get access to the Internet. For many Singaporeans, that incident was a wakeup call to the widening class divide in our society. The incident started when a blogger Derek Wee wrote about his worries about how the intense economic competition resulted in structural unemployment among Singaporeans and how we end up with the most having the "most highly educated taxi drivers in the world" because it is so difficult to get a job when you're retrench above the age of 40. You should read Derek's post[Link] and think about what he said and you may find answers to several questions - why people don't have children, why people leave, why our society is losing its cohesiveness. Before I discuss these issues, further I will tell you a story.

      4 weeks ago, I woke up late and had to take a taxi to get to work on time. I managed to catch a cab driven by a man in his early 50s. My brain must still be half asleep when I was in the taxi because I asked him a rather insensitive question - whether driving taxi was his part-time retirement job. He told me that 7 years ago, he went to work one day and was asked to leave because his performance was poor. He couldn't believe it because he had been with the company for 20 years and did not make any major mistake or had any discipline problems. He had been in his current managerial position for the 7 years doing the same thing year after year. He went to MOM to seek help and they told him there was nothing they could do and he would have to sue the company if he wanted his job back. There was no realistic chance of him winning a lawsuit given performance assessment is a subjective thing so he decided to move on and look for another job. After looking for 6 months, he couldn't find an employer who would hire him for the same type of job (probably due to age) so he ended up driving taxis - one of the few jobs still reserved for Singaporeans. While looking around for a job, he realised his former company probably decided to sack him because they could find someone younger to fill his job for 1-2K less pay per month. After years of annual increments, the company discovered they paid him "too much". However, instead of talking to him about a pay cut to help him keep his job, they decided simply to sack him. The company probably did not want to create potential "disgruntled employee" by keeping him around after pay cuts - finding an excuse to sack him then replacing him with someone cheaper was a lot easier to do under Singapore employment rules. There was extreme bitterness in his voice when he told me what happened to him.

      The above story is just one example of how companies get rid of older workers. Given the floodgates are opened for younger and cheaper foreign labour, companies have the option not to keep older workers. In the past when the labor market became tight during the good times, companies were more willing to give older workers a chance. However, now that the floodgates are open and companies have access to a large pool of cheaper younger foreign workers, it is hard for older workers to get a job that makes full use of their skills and experience.

      Strutural unemployment is just one of the problems in this ultra-competitive environment. The intense competition leads to a "take care of yourself first" mentality. The profit motive dominate the decisions of companies and the "hire and fire" without any social safety net and protection creates a constant sense of instability. People do not want to have children when they feel insecure. When you add this sense of instability to the rising income gap you get many people who are unhappy with the system. In addition to that, we have a group of elites who are groomed, protected in secure jobs, overpaid and are given the best opportunities available without facing the intense competition of the average Joes in our society. This is the source of intense resentment that broke out 4 years ago when the Wee Shu Min incident ignited hatred that spread beyond cyberspace. You can see this resentment everytime there is slip up by the political elites (YOG, Temasek Holdings losses, floods, Mas Selamat etc) - people just don't like the people running a system that makes life so insecure and tough for them. 4 years after the WSM incident and nothing has changed....Singaporeans understand nothing will change for them with the same people and system in place. The frustration will turn into action and we will see some of that in the coming elections.

      Tuesday, October 19, 2010

      Income Gap : Too Big to Ignore....

      The following is extracted from an article by Robert H. Frank [NYTImes - Income Gap : Too Big to Ignore] in the New York Times. He is working on a paper [working paper here] on the relationship between savings rate /expenditure and the income distribution..

      In a recent working paper based on census data for the 100 most populous counties in the United States, Adam Seth Levine (a postdoctoral researcher in political science at Vanderbilt University), Oege Dijk (an economics Ph.D. student at the European University Institute) and I found that the counties where income inequality grew fastest also showed the biggest increases in symptoms of financial distress.

      For example, even after controlling for other factors, these counties had the largest increases in bankruptcy filings.

      Divorce rates are another reliable indicator of financial distress, as marriage counselors report that a high proportion of couples they see are experiencing significant financial problems. The counties with the biggest increases in inequality also reported the largest increases in divorce rates.

      Another footprint of financial distress is long commute times, because families who are short on cash often try to make ends meet by moving to where housing is cheaper — in many cases, farther from work. The counties where long commute times had grown the most were again those with the largest increases in inequality.

      The middle-class squeeze has also reduced voters’ willingness to support even basic public services. Rich and poor alike endure crumbling roads, weak bridges, an unreliable rail system, and cargo containers that enter our ports without scrutiny. And many Americans live in the shadow of poorly maintained dams that could collapse at any moment.

      ECONOMISTS who say we should relegate questions about inequality to philosophers often advocate policies, like tax cuts for the wealthy, that increase inequality substantially. That greater inequality causes real harm is beyond doubt.

      But are there offsetting benefits?

      There is no persuasive evidence that greater inequality bolsters economic growth or enhances anyone’s well-being. Yes, the rich can now buy bigger mansions and host more expensive parties. But this appears to have made them no happier. And in our winner-take-all economy, one effect of the growing inequality has been to lure our most talented graduates to the largely unproductive chase for financial bonanzas on Wall Street.

      In short, the economist’s cost-benefit approach — itself long an important arrow in the moral philosopher’s quiver — has much to say about the effects of rising inequality. We need not reach agreement on all philosophical principles of fairness to recognize that it has imposed considerable harm across the income scale without generating significant offsetting benefits.

      No one dares to argue that rising inequality is required in the name of fairness. So maybe we should just agree that it’s a bad thing — and try to do something about it.

      Robert and his co-authors were looking at income inequality in counties in the USA but his findings are all too familiar and the negative effects of the big income gap is similar to what we experience in Singapore....perhaps with greater severity because there is only one developed country with an income gap higher than that of USA....that country is Singapore. With the large income gap, we cannot get the "net happiness" SM Goh talks about in a recent speech...it will always be "net unhappiness" and govt policy can only try to reduce the unhappiness.

      Saturday, October 16, 2010

      Seah Chiang Nee : Super-rich come to Singapore

      "Many of working class living in the heartland do not see much benefit from having so many rich people around – but they feel the pain of rising costs " - Seah Chiang Nee, The Star

      "'Supposing the world's richest man, Carlos Slim, comes to live in Singapore. The Gini coefficient will get worse. But I think Singapore will be better off. Even for the lower income Singaporeans, it will be better,"
      - PM Lee, 27 Mar 2010

      For ordinary Singaporeans to benefit from rich people coming here a few things have to happen - they are here to create well paying jobs (and not exploit cheap labor), they pay taxes under a highly progressive tax structure, and they do not drive up the cost of living for Singaporeans. What you don't want is have rich people come here to compete for limited resources such as housing and medical services - they will price out your own citizens and local Singaporeans will lose out. There was a good point made by an American writer Joel Kotkin said that Singapore should not try to expand the middleclass by importing it - it is only beneficial if it is created from within our own society[Link]. Importing richer higher skilled foreigners can result in the formation an underclass and ultra-underclass among native Singaporeans as the cost of living is driven up by a rate not that cannot be matched by the growth of their incomes.

      Very often importing foreigners makes the numbers look good e.g. Singapore is 4th highest in per capita wealth. You can get such achievements by attracting the likes of Jet Li, Jacky Chan and rich Indonesians by offering them a kind of tax haven to park their wealth here. However, this seldom translate to any benefits for ordinary Singaporeans less the few who work as investment bankers who are already overpaid for what they do thereby further widening the income gap even more.


      Super-rich come to S'pore [Link]
      Insight Down South
      By Seah Chiang Nee

      Many of working class living in the heartland do not see much benefit from having so many rich people around – but they feel the pain of rising costs.

      A LUXURIOUS 7,072 sq ft penthouse at a prime district has just changed hands for S$30mil (RM71.46mil) in one of the most expensive deals on a per square foot basis. The buyer was a permanent resident from Hong Kong and the seller an Indian tycoon who had bought it in 2006 for S$17.3mil (RM41.21mil).

      The cost of the triplex with five bedrooms and an 11m swimming pool worked out to S$4,242 per sq ft, a record in land-scarce Singapore.

      Last June, an unknown Chinese national snapped up a bungalow on Sentosa Island for S$36mil (RM85.77mil), the highest paid for a residence here. The PR holder from China had considered the price a bargain, according to the agent who handled the sale.

      These are among a rising number of wealthy foreigners – especially Chi­nese, Indians and Indonesians – who have made this city their family residence while doing business outside.

      Asia’s growing wealth, particularly from China and India, is slowly making its way into Singapore. More Europeans, too, are parking their money here.

      For a glimpse of a Singapore in, say, another 10 or 15 years, just take a picture of Monaca or Zurich and superimpose it on this island. What will emerge is a city of wealth – transient and abiding, a land of personal banking, celebrity-chef dinners, where Bentleys, Lamborghinis and Ferraris ply the street and branded goods will become daily items.

      An example of the foreign presence can be gauged at Sentosa Cove, one of Singapore’s most posh and expensive waterfront projects.

      More than 3,000 people now live there. They have come from 22 countries, the top five nationalities being Singaporeans (who make up 40%), Australians, Britons, Germans and Chinese.

      “Singapore has opened up a lot in recent years and we’re drawing foreigners keen to park their money as well as live here,” a developer said.

      The arrival of the nouveau riche has created new fortunes for Sing­apore’s upper middle class, but it has also widened the economic gap between the rich and the poor as few of the lower class derives much benefit from the phenomenon.

      For the upper class, the story is clear. Last year the number of millionaires jumped by 26%. Currently, 11.8% of Singaporean households have at least US$1mil (RM3.09mil) in investible assets (excluding property) each.

      Some recent headlines gave an indication of the change, good and bad.

      A Singaporean billionaire, Peter Lim, has just made a US$507mil (RM1.56bil) bid to buy England’s Liverpool football team. And two Singaporeans displayed their wealth less gloriously at the casino tables. One, a company managing director of a seafood business, lost S$26mil (RM61.95mil) in just three days, while the second, who was in the latest Forbes list of Singapore’s 40 richest people, dropped S$100mil (RM238.27mil). Easy come, easy go!

      Cashing in on it, Citibank last week launched an exclusive Ultima credit card for the super rich in Singapore where members must have S$5mil (RM11.9mil) and admitted only by invitation.

      Some of the nouveau riche came because of their children’s education. Among them is action star Jet Li, who bought a bungalow for S$19.8mil (RM47.15mil) last year. He took up citizenship and sent daughter, Jane to study here.

      Another new settler, US investment guru Jim Rogers, with a net worth of US$1.8bil (RM5.55bil), also came to send his daughter to the reputable Nanyang Primary School two years ago.

      To ensure she got a better chance, Rogers and his wife had performed 40 hours of volunteer work, something the locals do.

      Who are the richest foreigners living here?

      The Forbes’ list of top 40 ranks China-born Zhong Sheng Jian, 48, as the fourth richest man in Singapore with a net worth of US$2.5bil (RM7.71bil). And 47 year-old Indian-born Sudhir Gupta, now a naturalised citizen is ranked 13th richest. He has a personal fortune estimated at US$320mil (RM987.3mil).

      Seventeen percent of foreign buyers of high-end property in the first quarter are Chinese, and the number is rising. One out of five bought houses in prestigious multi-million dollar districts of 9 to 11, the Central Business District (CBD) and Sentosa.

      Some salesmen have reported cases of Chinese buyers paying the down payment with a bag of cash, leading to suspicion they may be keen to cover the money trail.

      Recently a growing number of foreigners have turned to buying landed properties.

      Under the law foreigners, including PRs, cannot buy any property on land or any apartment with fewer than five storeys – except with special approval. Under its strategy of attracting the wealthy and talented to settle here, the government appears to be loosening the screw.

      In the first half of this year, 150 such sales were allowed, most in the prime, rich areas.

      Local critics are protesting against such sale of precious landed properties. “It is like selling the country’s Crown Jewels to outsiders,” one blogger wrote.

      The influx of foreign wealth is not welcomed by all Singaporeans. Some see their cake becoming smaller and more expensive.

      Many of working class citizens living in the heartland do not see much benefit from having so many rich people around – but they feel the pain of rising costs.

      A polytechnic student asked: “And what happens to us when they suddenly take their money and go home?”

      Friday, October 15, 2010

      Overdose: The Next Financial Crisis

      Here's an interesting video that attempts to explain the recurring financial bubbles and crisis in the past 2 decades. A few months ago, Nobel Prize winner Paul Krugman warned that we may be entering a 3rd depression [Krugman : The 3rd Depression]. In the past few weeks a currency war threaten to break out as nations try to devalue their currencies to gain a competitive advantage[Time: Who would win a currency war]. It is hoped that the G20 summit next week[Link] will help to avert a currency war and prevent economic instability. In May this year, a sovereign debt crisis broke out in Europe and caused markets around the world to plunge. It is hard to say when the next financial crisis will occur but the potential for a crisis exists and according to the video the risks are increasing. While stock markets and property markets rally to new highs, it is so easy to become complacent and forget the risks.

      Thursday, October 14, 2010

      General Election on the way?

      There is speculation that the General Election is just around the corner (Dec 2010?) as Straits Times today (14 Oct 2010) reported that PAP MPs were asked to have their photos taken and prepare for rehearsal for speeches.

      I just want to show you something from the 2006 Election:

      "I am concerned about less-skilled Singaporeans, whose jobs and wages are under pressure. I worry for older Singaporeans too, living by themselves and having to provide for their medical and daily expenses. I am troubled that a terrorist attack will sow suspicion and discord among Singaporeans.We must respond boldly and creatively to these opportunities and challengesexpand our horizons and aim highWe will continue to restructure our economy to make it more productive and resilient. We should make our society more vibrant and cohesive. And our young must be imbued with the same can-do, never-say-die Singapore spirit that has brought us here"
      .– Prime Minister Lee Hsien Loong, his letter to Singaporeans, PAP Manifesto for General Election 2006.

      You remember this letter sent to you during the last election? I want to show it to you to remind you of PM Lee's promise in 2006 to "respond boldly and creatively" to the challenges faced by Singaporeans. That was 4 years ago. Just look at the above paragraph - right on top, he said "I'm concerned...about less skilled Singaporeans whose jobs and wages are under pressure". He sent this letter to all Singaporeans during the last election and after he got elected he opened the floodgates to cheap foreign labor and that increased the downward pressure on the wages of lower skilled workers. He increased GST - a regressive tax that would be most heavily shouldered by low wages earners. He increased the pay of his cabinet which was already the highest in the world prior to the increase.

      When the campaigning starts and the PAP men give their speeches and make their promises, remember what Lee Hsien Loong said in 2006 and what he has done since.

      Wednesday, October 13, 2010

      Lim Swee Say : Minimum wage has no place in Singapore....

      Having a union chief that believes minimum wage has no place in Singapore says a lot about what kind of system we have in Singapore. Minimum wage policy wherever it is implemented, whether in Europe long time ago or Hong Kong more recently, has always generated plenty of debate. However, you will never find a labor union chief in any other country that will speak out against paying workers a minimum decent living wage. Lim Swee Say speaking against minimum wage just shows us how lopsided and unbalanced the system is ....even more so than the absence of a minimum wage itself. Lim Swee Say, as labor chief, also urge workers to be "cheaper, better, faster" at a time when Singapore has the highest income inequality among developed countries.

      Lets get it clear, the debate on minimum wage in Singapore gained momentum because income gap has widened so much in the past decade and an significant underclass consisting of the bottom 20-30% of resident workforce has emerged. If the PAP govt had not pursued policies that caused the income gap to widen such as allowing the influx of cheap imported labor, regressive taxation policies and erosion of labor rights and benefits, the reasons for having minimum wage would be less compelling.

      Lim Swee Say recycles old arguments against minimum wage. He says it will erode competitiveness by raising business costs and cause unemployment. Labor is only one component of costs - rent, utilities, govt charges etc. You never hear Lim Swee Say urging landlords to keep rentals low or reducing CEO pay or suggesting that electricity tariffs which is 2nd highest in the world should be reduced to keep Singapore competitive - he believes in making workers "cheaper" to stay competitive as part of his CBF (Cheaper, better faster) strategy. Higher wages will actually provide businesses with incentives to automate and increase productivity which has been falling forthe past few years. Minimum wage only causes unemployment in economies that are highly dependent on cheap labor. We should restructure our economy and move away these industries otherwise we will have workers locked in a 3rd world wage structure coping with a 1st world world cost of living.

      If we believe a person working full time in Singapore should be paid decent wages , we have to make it happen with leadership that is determined to put in place the economic pre-conditions that make it possible. All developed countries other than Singapore have done it. Hong Kong has gone ahead and Malaysia is likely to implement it by next year. We, in Singapore, have a "cannot do" leadership that seeks to maintain the status quo because it best preserve its own interests and the interests of the large network of businesses to which it is linked. In such a system, inequalities can only expand....

      Minimum wage policy won't work: Employers, labour chief

      By Kor Kian Beng

      SINGAPORE'S labour chief and employers have come out strongly against the idea of a minimum wage and debunked recent claims it would be effective in helping the country's low-wage workers.

      National Trades Union Congress (NTUC) secretary-general Lim Swee Say and the Singapore National Employers Federation (SNEF) marshalled arguments to show that a minimum wage is hard to implement effectively and failure to do so would trigger negative effects on workers and bosses alike.

      The nasty consequences include raising business costs, driving up joblessness, pushing up costs of living and eroding Singapore's competitive edge, while doing little to lessen income inequality.

      Mr Lim, who leads 60 affiliated unions with more than 530,000 members, made it clear in an interview with The Straits Times last week that a minimum wage has no place in Singapore - now or in the near future, because 'it will not work'.

      He said there was no way to get it right: If the wage was set too low, it would serve no purpose as low-wage workers would continue to earn little. If set too high, it would trigger higher unemployment as companies would cut demand for labour or their investments.

      Based on Singapore's workforce of two million, every one percentage point increase in the unemployment rate would mean 20,000 low-wage workers losing their jobs, cautioned Mr Lim, who is also Minister in the Prime Minister's Office.

      He dismissed as well the idea of setting different minimum wages for each sector, depending on the type of work done by low-wage workers, as it would be hard to justify why workers in a certain sector should be paid a higher wage.

      In response to media queries, the SNEF said a minimum wage would raise costs and force bosses to respond in ways 'none of which are beneficial'.

      These include cutting headcount and trimming workers' benefits and training. Ultimately, a minimum wage would eat away at the competitiveness of the Singapore workforce, said the SNEF, which has 2,000 members employing more than 600,000 workers in total. It said: 'Jobs will be lost and fewer new jobs will be created as new businesses find the minimum wage an impediment and choose to start up elsewhere.' SNEF also cited research findings that showed a causal link between a minimum wage and negative effects on employment in countries like the United States. The robust response from the labour movement and the employers follows a debate on minimum wage last month. It began with opinion pieces by National University of Singapore economists Lim Chin and Hui Weng Tat - the former opposing, and the latter supporting the idea. This was shortly after Hong Kong, an economy often compared to Singapore, legislated a minimum wage in July, paving the way for its implementation by next year. A minimum wage sets a salary floor employers cannot breach. Its key aims are two-fold: Protect low-wage workers from potential exploitation and help them earn higher wages to cope with rising costs of living. In the latest debate, the idea of a minimum wage appeared to gain more support because of a widening income gap here. Official figures showed top managers earned four times more than cleaners and labourers at the bottom in 1998. It grew to 5.12 times in 2008. Lending support this time were Ambassador-at-Large Tommy Koh and Mr K. Kesavapany, director of the Institute of Southeast Asian Studies. Disagreeing, Mr Lim and SNEF believe the better way to help low-wage workers is to raise their skills through what Mr Lim calls a 'minimum skills' approach. Developed since the mid-1990s, this includes a training infrastructure with 46 centres islandwide, and a nationally recognised skills certification system. Over time, higher skills and productivity would lead to higher wages, instead of compelling employers to cough up the extra money through a minimum wage law, said Mr Lim. 'We believe the most effective wage ladder for low-wage workers is the skills ladder,' he said. Responding to Straits Times queries, the International Labour Organisation said a carefully articulated set of wide-ranging policies is needed to secure 'minimum income' for low-wage workers. It believes this holistic approach is 'at least implicitly reflected' in Singapore's recent policy measures. But this does not mean there is no need for a minimum wage here because it can help prevent abusive wage practices, it added.

      Saturday, October 09, 2010

      Wealth or Extreme Inequality?

      UPDATE: Abhijit of Pressrun has done an analysis of the Credit Suisse report[analysis here] and found that the median wealth in Singapore is the lowest among the 25 countries surveyed. The median wealth in Singapore is lower than in S. Korea, Taiwan, Australia and Japan. Due to the highly unequal distribution of wealth in Singapore, a typical (median) adult in all other developed asian countries has more wealth than a typical adult Singaporean. 

      Singaporean workers work the longest hours in the world[Link] and top the world rankings for stress[Link] yet the wealth generated in our society is concentrated in a small % on the top of the pyramid. This is the result of years of lopsided and unbalanced policies that created a 3rd world wage structure[Link] in Singapore. This elitist system is unfair and over-rewards a handful in our society while those who work the hardest and deserve a better life are made to struggle at the bottom.

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