"Societies must be flexible in re-inventing and refining their economic system," Lee told his listeners in San Francisco. "The strength of the American system is that it has always embraced change and creative destruction." Lee Kuan Yew, CREATIVE DESTRUCTION CITY, Asiaweek, March 24, 2000 Vol. 26 No. 11,
Before everyone gets carried away with the seeming volte face of Singapore's impending "creative destruction", so wistfully touched upon by Lee Kuan Yew, I think that one has to remember that it's easy to talk the talk about paradigm change but can the PAP walk the walk?
The excitement generated by paradigm change makes me recall Tony Tan's 1980s speech to the creme de la creme of Singapore's civil service, the administrative service. Tony Tan singled out Pulitzer Prize winning historian Barbara Tuchman's THE MARCH OF FOLLY, that discussed turning points in history illustrating the very heights of folly of government: the Trojan War, the breakup of the Holy See provoked by the Renaissance Popes, the loss of the American colonies by Britain's George III, and the United States' persistent folly in Vietnam.
Tony Tan told Singapore' civil service that one should never be afraid to change a policy or point it out to their political masters, that is clearly erroneous or appears to be a folly. To a large extent that is true with the dissolution of the graduate mothers scheme and the extrication from Suzhou.
Tempering the brouhaha that Lee's comments engendered, there is already the customary caveat as evidenced by George Yeo's statement in the same ASIAWEEK article that change will not be revolutionary but "more evolutionary, the result of a new generation educated after Independence."
But this incrementalist approach to management change is too little for the alienated and too late for those already enlightened who would have moved to Silicon Valley with their stock options. I guess that in spite of it all, the PAP still does not get it. In Net-terms, waiting out a thirty-year real time generation period, once hot technologies would have been obsolete and interred as an exhibit in the Smithsonian after thirty years. It's business at the speed of light!
What the Singapore government apparently has not learnt is that the government should leave business to private business and if the government can't get it, it should get out of the way. It may be hoping against hope that the Singapore government will not only internalize Tuchman's thesis but also apply it, since the government's exploits in the broader economic playing field outside of Singapore has been far from encouraging.
Not surprisingly, the US-based Heritage Foundation's 2000 INDEX OF ECONOMIC FREEDOM succinctly characterized the PAP's past management of the economy as "dilettante central planning in which the authorities strive to be first but at the cost of efficiency and the ultimate well-being of the (Singapore) people."
The Heritage Foundation's report did highlight MIT's Alwyn Young's seminal thesis 1992 'TALE OF TWO CITIES" which was popularized by Krugman's more accessible 1994 "THE MYTH OF ASIA'A MIRACLE". Now, these articles had laid the writing on the wall in the early 1990s way before the Asian Financial Crisis of 1997. What did the Government or the civil service do? They poohed poohed it, doubted the numbers and spouted the greatness of Asian values yadda yadda yadda - the rest is history they say.
Ironically, for all the grief that the Heritage Foundation's report card seems to have given to Singapore, it still ranked her at the top of the economic freedom scale. But the caveat is Singapore owes her premier ranking "not only to their (Singapore's) own good policies, but also to the greater policy errors of other governments" and the top score of 1 is a goal that even " governments of imperfect men and women can attain". But more worryingly, the Heritage Foundation notes that governments elsewhere "adopting policies that promote economic freedom and long-run economic growth" so Singapore has to stay nimble on her feet.
If our civil service really had taken Tony Tan's Tuchman speech to heart when he made it in the 80s, Singapore Inc.'s managers could have taken these considered economists' opinions about the dangers underpinning the South-East Asian economies and reconsidered investments in other areas. There was a need for retooling Singapore's investment policies then or at least used reconsidered S'pore Inc.'s holdings in the SEA economies but history has shown the hubris and we are now mopping up the milk of human folly that has been spilt.
Lost out in the discussion is that for all the talk about loosening the government's hold on the economy, there is a direct relationship with the PAP's political hold on the country. In knowledge-based economy - information is power and so long as there is no political will to loosen the control on information, the knowledge economy cannot run very way on the best of expectations or pure adrenaline and especially not empty jargon and sloganeering.
There are institutional and attitudinal political changes to be made. These institutional changes include the abolition of the political control of the local/foreign media (gazzetting), setting up Freedom of Information regulations, the abolition of the ISA or the reinstatement of judicial review of Ministerial decisions to issue such orders of arrest, and other tools facilitating transparency in the governing process are necessary are non-starters in this paradigm change.
The restrictions of the local and foreign press (with previous gazetting of the ASWJ, TIME, FEER) are a clear and present danger to Singapore's global competitiveness.
Again the Heritage Foundation's report said that the PAP's continued hankering of the PAP's primacy media restrictions contribute to a potential economic Achilles heel. "A modern market economy depends on the free flow of economic and commercial information. .... Even if it were Singaporeís policy to censor only political material, in a modern economy it would be impossible in practice to censor the political without inhibiting the economic flow of information and opinion."
Moreover with the mutual symbiosis of Singapore Inc's heavy hitters where most of these government linked companies are intertwined in one way or other - economic information is almost always political information - hence exacerbating further the inner contradictions of having to grapple with openness in a knowledge-based economy and the political control of such knowledge.
Major surgery is sorely needed. But the flaccid palliative currently on offer is a licensed Speakers' Corner. Even in an age of diminished expectations, this is scrapping the underside of the barrel. There is still no political will to give up the monopoly of information and access to the decision-making process.
Attitudinal changes? Well therapy may be too much to expect but the arrogance, the know-it-all and belief of infalliblity has got to go. But the main problem is that the PAP may have won the pocketbook of many Singaporeans (1997 election promise of HDB upgrading for voters who vote for the PAP), the PAP appears to have given up on winning the hearts and minds of Singaporeans. But to expect that the civil service to change without the political leadership to showing the way is not only counter-productive but also more alienating.
What has to be understood is that the singular driving mantra of the PAP's pragmatism in power is not only to hold on to power but to use current political power to perpetuate it.
This is the pure realpolitik and management theories or the lack thereof are but instruments of this policy. For all the shorthanded jargon that is bandied about like "reinventing", "paradigm change" or "creative destruction" - it may very well be just that.
Doesn't it make you wonder that the same people who can muck up in commerce/business aren't exactly infallible in all areas of government which is why there are checks and balances. For goodness sake, even the Pope (the paradigm of infallibility) has apologized for Catholic Church's excesses like the Spanish Inquisition, persecution of reform Christians and Jews. When talks about paradigm change, the paradigm includes the whole kitchen sink.
Whenever someone comes up with alternative ideas, the PAP and their apologists attack the messenger - What's his motive? Foreigners can't comment on Singapore issues? yadda yadda yadda. Solution? Stop attacking the messenger & listen to the message. The messenger may be imperfect but the truth of the message will set you free.
I have never questioned the PAP's ability to govern correctly some of the time or even most of the time, but one can never govern correctly ALL the time. Unless, the government levels the political playing field, it can talk the talk but it can hardly walk the walk of paradigm change.
John Tessensohn in Osaka, Japan