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Cheong Suk-Wai
Monday, Aug 18, 2014

Singapore

Singapore shows the world the way ahead

The Straits Times | Cheong Suk-Wai | Monday, Aug 18, 2014

"Our Young Singaporeans" by businessman Poh Lye Kiat won the second prize at the Singapore My Home 2009 photo competition which was organized in conjunction with the National Day Parade 2009 theme of "Come Together". He gathered some children after a National Day event in Yio Chu Kang Community Centre for the photo.

There are few things as satisfying as an idea whose time has come.

For Singaporeans on the cusp of half a century of Independence, that satisfaction should come from knowing that everyone else now wants to learn their style of government for a better future, say The Economist's John Micklethwait and Adrian Wooldridge.

That model, as they outline beautifully in their new book The Fourth Revolution, is about having a bright and technologically astute corps of elites govern a country efficiently and productively - all on the leanest of budgets. In all, governing Singapore chews up only about 17 per cent of its gross domestic product, less than the 25 per cent limit proposed by British economist John Maynard Keynes, they add, calling the Singapore model "the Asian alternative" to the largely bloated, bumbling and bribe-happy governments elsewhere.

Crediting founding father Lee Kuan Yew as its creator, the authors laud his style as "tough love" which is "elitist and stingy", resulting in the greatest economic "miracle" of the past 70 years.

That, the authors argue, had a lot to do with his insistence on self-reliance, in the form of the Central Provident Fund where 90 per cent of what you get depends on what you put in, instead of social assistance, which he considers an "all-you-caneat" buffet, as practised most notably in welfarist Scandinavia.

Most significantly, they stress, China is learning all it can about Singapore-style governing. So, they note, while some may scoff at the city-state's ban on chewing gum and treating its citizens "like children", its mix of state-directed capitalism and city planning is being copied on a grand scale by China.

Micklethwait is The Economist's editor-in-chief, while Wooldridge is currently its management editor, writing the superb column Schumpeter on workplace concerns. They interviewed Mr Lee for this book in 2011, and devote Chapter 6 of their nine-chapter book to the Republic.

This book, their sixth outing together, focuses on what they call the coming "fourth revolution" in governance, claiming that this revolution, iconised by their Asian alternative, will be bigger than even communism.

This fourth revolution is nigh, they argue, because most people have grown contemptuous of those who lead their countries. The authors say this is largely because the free-wheeling Western version of democracy has led to increasingly demanding electorates which massive, clunky government machinery fails to serve well.

The first 31/2 revolutions in governance then, they argue, began in 1651 when Briton Thomas Hobbes published his tract Leviathan. In it, Hobbes proposed a social contract between rulers and the ruled, in which citizens would let rulers restrain some of their rights in return for protection. This gave sovereigns reason to build a bureaucracy to help them govern, transforming their fiefdoms into nation states.

The nation state was the dominant form of political control until The Enlightenment of the 18th century and the Industrial Revolution of the 19th century. Western thinkers in these two centuries unleashed the second revolution, arguing for greater personal liberty and smaller government. Chief among them were Briton John Stuart Mill, and his father James, who championed keeping the state out of most people's affairs as much as possible. Their views gained traction as they were buoyed by the growth of free trade and industry globally.

The 20th century, however, brought a backlash against such free-spiritedness, the authors note, as most people came to believe that it led to lots of physical and social diseases. This led to the third revolution in governance, when husband and wife Sidney and Beatrice Webb gave the world their blueprint for the welfare state, in which governments intervened in almost every facet of a person's life, especially in education and health care. Big government did not get bigger than this, and the Webbs' welfare state was embraced most famously by the Nordic countries.

The "half revolution" after this, say the authors, came in the person of American economist Milton Friedman. He militated against big government. Britain's Margaret Thatcher and United States president Ronald Reagan heeded him and forced their citizens to be more self-reliant, which was very disruptive as the latter had come to expect handouts from their governments.

The authors dub Friedman's mantra a half revolution because Friedman himself acknowledges that he has only partially succeeded, as bloat and inefficiency in government are back, and in some cases bigger than before. As the authors note, Friedman himself said in 2004: "After World War II, opinion was socialist, but the practice was free market. Now, opinion is free market, but practice is nearly socialist."

Singapore, as created by Mr Lee, they say, "is two parts Hobbes, one part Mill, with a dash of Asian values". The latter are defined as rooted in focusing on family, saving one's income, learning for life and having faith in mandarins. The authors, however, stop short of calling Singapore's governing style "ideal". That is only to be expected, because their vision of the fourth revolution is of a governing model in which citizens are freer to express themselves and innovate.

But here is where they seem to be running around in circles. Being freer, in the sense of unfettered individualism, is also a big part of what has led to present decay in most governments. As they themselves acknowledge in the book: "Politicians have done what the voters want them to do."

The authors try to argue their way out of those circles by saying that a ruling elite should think long term and use technology to tighten things at the national level, while letting the citizenry solve more of society's problems at the local level by innovating to, say, cut the cost of heart surgery from $100,000 to $2,000, as India's Devi Shetty has done.

This book is also important for firmly laying to rest the myth that Scandinavia has made a success of the Webbs' welfare state. As the authors see it, the Scandinavians went through massive credit crunches well ahead of the United States and its sub-prime mortgages, and the rest of Europe and its euro crisis.

For instance, the authors show, Sweden had to butcher its public spending programmes after its mortgage rate shot up to 500 per cent in the 1990s. "The streets of Stockholm are awash with the blood of sacred cows," note the authors. That was after the Danes were faced with a daily diet of potatoes only in the early 1980s.

The thing is, they stress repeatedly, the East is hungry for new ideas and willing to learn, whereas Western leaders are "like ostriches", burying their heads in the sand. As the authors point out: "If you want to look at the future of higher education, can you learn more from the United States and France, where 40 per cent and 25 per cent of the students drop out, or from South Korea, which beats the world in college enrolment?

"If you want to set up a pension system, would you look at America's Social Security system or Singapore's Central Provident Fund?"

suk@sph.com.sg


This article was first published on August 16, 2014.
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