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The rich are different to us…..they have more money

Apr 19

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Yesterday I talked about the importance of democracy and inclusive political institutions to ensure inclusive economic institutions and prevent the adoption of policies that only benefit a narrow elite. These days one cannot pick up a government-owned newspaper or turn on the TV without  being told that PAP’s goal is to build an inclusive society.  However we will find it difficult to build an inclusive society whilst we continue to have non-democratic and non-inclusive political institutions.

The last few weeks we have been treated to tantalizing revelations about how important dynasties and family relationships are in China. In today’s FT there is an article about the downfall of Bo Xilai (Bo’s Downfall Sheds Light on Nepotism, http://www.ft.com/intl/cms/s/0/6be8993e-8962-11e1-bed0-00144feab49a.html#axzz1sUTm09iB). Both Bo Xilai and Gu Kailai are children of revolutionary generals and Bo’s father, Bo Yibo, was one of the “eight immortals” who ruled China behind the scenes in the 1980s and 1990s. Their other siblings all hold important posts in state-owned companies or have control companies that do business with the Chinese government. While Bo Xilai was the General Secretary of Chongqing his wife was a lawyer who set up and benefited from a number of business ventures both inside and outside China. In fact it was the threat that her financial dealings were to be exposed that allegedly led Gu Kailai to kill the British businessman Neil Hayward.

It is ironic that the Chinese Communist Party, which like the Soviet Communist Party, seized power with the tacit consent of the majority by promising to raise the masses out of poverty and eliminate inequality should be captured by a group of elite family dynasties.  Recently Bloomberg reported that the 70 richest delegates to China’s National People’s Congress were worth an aggregate of $89.8 billion, or more than a billion dollars each.

“In other countries children of politicians often get opportunities that others don’t but the problem in China is there is absolutely no transparency and there is also a strong sense of entitlement, that this money is their birthright,”   said one person with close ties to top political families in China.

“The problem for the Party is that exposing the Bo family businesses makes people realize that this is how it works for everyone.” (FT)

The importance in business of having family ties to or friendships with politicians is of course not a phenomenon that is confined to China. In Africa, Uhuru Kenyatta is reported by Forbes to be owner of Kenya’s biggest dairy company and one of Africa’s 40 richest residents. He served as deputy prime minister of Kenya and is the son of Kenya’s first president, Jomo Kenyatta. In the Mideast, the Bin Laden family made its riches through construction contracts for the Saudi government derived from the close relationship of Mohammed bin Laden and his sons with the Saudi royal family.* The former President of Egypt Hosni Mubarak’s family are reported to have accumulated a fortune of US$80 billion.  The family of the deposed Tunisian strongman are estimated by Al-Jazeera to have taken US$17 billion with them when they left the country while the Gadhafi family wealth is estimated at a seemingly implausible $200 billion by the new regime.

However one should not be surprised at this. After all non-democratic political institutions tend to be extractive and frequently serve just to maintain the power and privileges of an elite, whether a group of families as in China or a hereditary aristocracy as in Europe. A vicious circle develops in which dominance of  political power helps the elite to increase their economic power which in turn reinforces their political power. They have some interest in economic growth as long as it raises their wealth and they have to keep living standards for the masses either rising or not deteriorating enough to pose a threat to their rule. In this North Korea appears to be an exception, as the Kim dynasty is now into its third generation despite having reduced the bulk of the people to starvation and absolute destitution.

Here in Singapore “Inclusivity” will remain just another buzzword without  full democratic institutions to back it up.  As a former colony there was already a history of extractive political institutions.  The struggle to build new democratic ones was not helped by one party walking out and handing a walkover to the other so early in our post-independence history.

Our new buzzword should be transparency. While we have a Code of Conduct for Ministers that requires them to disclose their income, assets and liabilities to the PM upon taking up office – this does not go far enough. I propose that we need to  move to full annual public disclosure including the property and incomes of spouses and dependents. The same rules should be extended to senior civil servants, judges and senior management and directors of GLCs. This would only bring us in line with what public servants are required to do in democratic countries. For instance in the US, the Ethics Act requires annual disclosure of financial information by the president, vice president, members of  Congress, federal judges, presidential appointees, and other officials and employees earning at or above a specified pay-scale or with policymaking responsibilities. There are similar laws in Canada and many European countries while the UK has announced plans to make public ministers’ tax returns.

* http://dealbook.nytimes.com/2012/04/04/to-do-deals-nothing-helps-like-friends-in-high-places/

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We must move up the Value Chain rather than give up on Manufacturing.


The release of the unemployment statistics two days ago brought home the folly of current policy.

http://www.straitstimes.com/BreakingNews/Singapore/Story/STIStory_761247.html

While the government prided itself on creating 121 thousand jobs last year two-thirds of these went to foreigners. Manufacturing employment hardly grew while the bulk of job creation was in services and construction, where salaries and productivity are much lower than in manufacturing. The proportion of foreigners in the workforce edged up slightly to 37% of the total. This makes a mockery of the government’s avowed intention to restrict foreign workers to around a third of the workforce.

The figures for manufacturing need a close scrutiny. Policy proposals from some of the contestants in GE 2011 to phase out manufacturing would be a mistake if not disastrous. Rather than depending on cheap foreign labour, we need policies that move us up the value-chain, both in manufacturing and services. This is brought home by the latest statistics. These illustrate the absurdity of current government policies when two-thirds of jobs created last year went to foreigners and were in the service and construction sectors where average wage levels are much lower than in manufacturing.

Recently reading about the Republican primaries put me in mind of some of the more right-wing Tea Party candidates’ crazy ideas. One of the more notable themes has been attacking Obama’s bail-out of the auto industry in 2009 which prevented GM and Chrysler closing down and the loss practically of the whole US auto industry sector with hundreds of thousands of skilled high-paying jobs. Even a simple cost-benefit analysis of the losses in terms of lower taxes and higher welfare payments in the absence of the bailout would have outweighed the costs.

In addition a lot of research has gone into the positive externalities associated with clusters of particular industries in a specific geographic region and that the presence of complementary industries enhances entrepreneurship and start-up activity. If the companies had closed down then it is likely that there would have been a vicious circle of knock-on effects on related industries and the loss of a big part of the skill set to foreign competitors with the result being permanently lower incomes, employment and taxes. Sure there would have been new jobs created in other areas such as services but these would likely have been lower-paying.

If I was being sufficiently Machiavellian, the sheer stupidity of the objections might lead one to conclude that the Republicans advocating this strategy were Japanese, Korean or German agents. Obama’s recent advocacy of a strategy to reward companies manufacturing in the US and negate the advantages of transferring production to tax haven countries by imposing a minimum unitary tax are, besides being electioneering, a deliberate strategy to reverse the loss of high productivity jobs to countries which pursue a more active industrial policy.

In Singapore also there has been some debate about the proper role of manufacturing in the economy. During the GE one of the parties advocated the phasing out of manufacturing in Singapore and concentrating on services instead. The party also pointed out that the proportion of Singaporeans studying engineering is falling while claiming that most young Singaporeans prefer to work in the service industry. Again this is a failure of government policy not a reason for abandoning engineering as a discipline.  Certainly remuneration levels for engineering careers compare favourably with other career areas. Chemical engineers in the US now command the highest starting salaries. Also the preference of young people for service jobs, if correct, is probably the result of the government’s policy of subsidizing low-tech manufacturing through cheap foreign labour which has resulted in wage levels that are unappealing. Engineers are also highly sought after in the financial sector.

One of the more ridiculous ideas involved giving $10 billion to manufacturers to phase out their operations here and relocate them to neighbouring countries. This is worse than the current tax write-offs given in the US for closing down factories that the Democrats have rightly targeted to correct the bias against domestic manufacturing. While we need to stop the subsidies given to low-tech labour-intensive manufacturing which is reliant on cheap foreign labour this is not a reason for give up on manufacturing altogether. We just need to make sure we move up the value chain into high-tech high value-added industries. While the government was rightly critical of the idea of phasing out manufacturing, they of course ignored the fact that the government’s strategy continues to favour low-tech industry by allowing ready access to cheap foreign labour.

The government’s policy has always been of growing GDP in the easiest possible manner while neglecting its primary duty of raising the incomes and living standards of Singaporeans. Even its biggest recent success, in luring a big chunk of global pharmaceutical manufacturing to Singapore through tax breaks and holidays appears opportunistic. It will be interesting to see if it can be sustained in the long-term given the moves in the US to neutralize attempts to lure domestic industry away through tax breaks.

The UK government has also proposed the use of tax incentives to lure domestic industry back to the UK. I wrote back in 2009 about the dangers of a zero-sum game which ended up benefitting no one but the multinational companies (http://theonlinecitizen.com/2009/05/us-tax-rule-changes-and-implications-for-singapore-the-prisoner%E2%80%99s-dilemma/)

The worrying sign is that despite the solemn promises to phase out foreign labour during GE 2011 the PAP government is going the other way.  Just one example is the 26 new hotels slated to open by 2014 with 5,500 new rooms where the vast majority of the jobs will go to foreigners.

The inescapable conclusion is that we do not need this absurd over dependence on foreign labour to create prosperity for Singaporeans. We should not give up on manufacturing either, just ensure that we move up the value chain. It is true that modern manufacturing uses much less labour. Over the last ten years US manufacturing output has expanded by a third while the number of people employed has fallen by a third. However service industries are likely to see a similar “hollowing out” as advances in software permit rapid productivity gains. But do we need so many jobs? By reducing our dependence on foreign labour we could have fewer but higher productivity and higher paying jobs but a larger share for Singaporeans. In manufacturing we should aim to be like Germany rather than attempting to compete with China on labour costs. 

Dear Santa, I don’t like the cadre and secret cabal I got last year. Next year I’d like some openness, competition and democracy instead.

Dec 12

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Recently the PAP held their first Party convention post election allowing us to scrutinise the cadre system and the iron grip on power that it provides for.  AlexAuwrote about it in his blog (http://yawningbread.wordpress.com/2011/12/03/four-barriers-to-remaking-the-pap/) where he highlighted his opinion that the cadre system is one of four main reasons why the PAP would fail to learn any lessons from their setback in GE 2011. The rest of his reasons would be worthy of discussion in a separate article in their own right.  However as we look back at 2011 I will concern myself with a closer look at the cadre system and how it affects your ricebowl.

It is of course not only the PAP who employs the cadre system. For the benefit of those who may be unfamiliar with the term, a cadre system is one in which the leadership of the Party selects certain members to be cadres. The cadres are then the only members who have voting rights   and they elect the leadership. It is of course a completely closed system in which the leadership ensures its position by only selecting as cadres people who will be loyal to them. The cadre vote the leaders who select the cadre who vote the leaders who select ………………..and so on.

In her 1971 political science thesis, “Singapore’s People’s Action Party: Its History, Organisation and Leadership (Oxford University Press)”, Ms Pang Cheng Lian, who sits on the board of Temasek Cares, describes elections to the CEC by the cadres as a “closed system”, in which “the cardinals appoint the pope and the pope appoints the cardinals”.  Most of us Singaporeans know this system is employed by the men in white.  Sadly, as far as I am aware, every other political party in Singapore employs a variant of the cadre system. This includes the Workers Party, the SDP, the NSP and the SPP.  I have no information about the other new parties, the Justice Party the USD (does anyone remember them? ) and the new parties still to come  in 2012 but I believe it is safe to assume they all employ or will employ the same system.

Just as Alex believes the cadre system may explain why the PAP is incapable of learning new lessons so I believe that adherence to the cadre system may be partly responsible for the agonisingly slow progress of the Opposition parties and the dearth of new ideas or renewal.  It is certainly the culprit behind the endemic Party hopping which discredits all Opposition equally and has nothing to do with renewal of ideas. Party hopping is the same old faces, with the same old ideas but with new titles.   It would take a visionary to develop a party with a radically different structure. Or maybe a democracy veteran with no time left to lose who, looking back on his life’s work, realised that closed organisations can’t give birth to Open Societies. Yes, The Reform Party is the only political party in Singapore which is a democracy since it alone does not have a cadre system to protect the leadership and all members have voting rights.

The cadre system has its origins in the Marxist concept of the “dictatorship of the proletariat” and the “vanguard”. This meant that only a small elite group of individuals were fit to lead the Communist Party and the nation. The masses were not ready for democracy and it was better that they be led by those who knew best. The Communist ideal was one of eventual full democracy once the masses had been educated enough. Leninargued (Wikipedia, http://en.wikipedia.org/wiki/Vanguardism) the ideal vanguard party would be one where membership was completely open and its workings transparent, the “entire political arena is as open to the public view as is a theatre stage to the audience” (from What is to be Done?).  He seems to be acknowledging the benefits of competition though cannot speak its name when he goes on to say that a party that supposedly implemented democracy to such an extent that “the general control (in the literal sense of the term) exercised over every act of a party man in the political field brings into existence an automatically operating mechanism which produces what in biology is called the “survival of the fittest”.” This party would be completely open to the public eye as it conducted its business which would mainly consist of educating the proletariat to remove the false consciousness that had been instilled in them.

The cadre system went on to be adopted by both the Kuomintang and the Chinese Communist Party and by many other Maoist revolutionary parties throughout the world.  Lenin originally intended it to deal with the problems of controlling and maintaining the secrecy of the Bolshevik party which was seeking to overthrow the Czarist regime in Russia, in the face of infiltration by the Okhrana, the Czar’s secret police.  Ironically the goal of preventing infiltration, this time by Communist agents, is the oft-cited justification given by the PAP leadership as to why the cadre system was introduced. If so it does not justify its retention today when there is no longer a Communist threat. Even if there were the ideal way of combating it would surely be through more democracy not less.

Of course the Communist roots of the PAP are not a secret.  This is why the arbitrary arrest and detention of certain individuals on the grounds that they were Marxists and that they represented a secretive organisation is particularly ironic.

The fact that the PAP continue to maintain a cadre system shows how out-of-step they are with modern democratic parties and how little understanding they have of the benefits of competition and transparency and accountability. While they maintain a closed system which ensures that only people, who hold the leadership’s views, whether out of principle or self-interest, get to vote, it is difficult to see how any renewal can take place. Perhaps it is too much to expect the ordinary people of Singapore to understand the need for multi-million dollar salaries for ministers. They are afflicted with the false consciousness of a belief in democratic values and the equality of individuals. You need elite (the cadres) who are sufficiently intelligent not to fall prey to false consciousness to understand why servant leaders need millions of dollars as remuneration.  Hopefully the review board will be able to explain it to us shortly.

However the other parties inSingaporeclearly feel the same way as the PAP that democracy is a dangerous idea and power should not be entrusted to the ordinary members.  Or they merely aspire to be the PAP and adhere slavishly to their ideas and methods-PAP LITE, if you will.  Whatever the motivation, all of them maintain some sort of cadre system. The argument often given for the necessity of this is that it leads to “stability”. This is just another facet of the argument that democracy leads to gridlock and that the people are too short-sighted or stupid to exercise power responsibly. Even if a so-called extreme faction managed to be elected to the leadership, like the AWARE situation, ultimately democracy ensures competition. If the new leadership fails to reflect the will of its members or is unsuccessful at winning electoral office then it can be replaced.

It is genuinely worrying that so much of the Opposition shares the same mindset as the PAP. This begs the question as to whether their leadership are genuinely interested in change or representation or whether it is merely power that they seek.

To recap on what I said earlier, the only party that does not have a cadre system is the Reform Party.  The RP is thus the only genuinely democratic party. Instead of a closed system, the RP CEC is elected by the Party Conference which is made up of delegates.  Everyone, provided they fulfil basic criterion, gets a vote.  As a result the Party is the purest expression of the will of its members. The Party Conference promotes a free market in ideas as any member can put forward a motion. As it forces anyone running for office to be responsive to the views of the members, it represents the implementation at the Party level of the principles we are fighting for at the national level.  We refer to this as Conference being Sovereign. It is clear that when JBJ set up the RP he wanted to have nothing to do with secretive cabals and backroom deals and start a party that would exemplify the virtues of democracy. He learnt from bitter experience, when he was ousted as SG of the WP, how dangerous an unrepresentative clique is.  In a way a genuinely democratic party was his legacy to the nation and serves as a model of what we need to see at the national level.

Many are scared away from joining the RP because of the lack of a cadre system which they feel makes it inherently unstable.  Certainly its first three years have not been an easy ride.  But if democracy itself is something we seek and value then a truly democratic Party is a necessity.  As the RP is not a good long term bet for ironclad  power, it is less attractive as an option to those who are power hungry or egotists.  Why go to all that trouble to infiltrate a party to make it less radical, less viable as an agent of change, when you may be voted out in 2 years time and the Party may simply revert to its former state?  This is what we saw happen with Aware.  A group of women cleverly saw that getting like minded members in the organisation in sufficient numbers was key to changing its identity.  But ultimately Aware was strong enough and its original ideology and had been in existence long enough to shake off that challenge.

No doubt many initially joined RP in error not clearly realising the ramifications of the democratic nature of the constitution.   What a shock it must have been to them to realise that Conference is Sovereign and yes, they would actually need to get a majority vote from ordinary members to change the constitution and bring in a cadre system.  How much easier it was to simply do a deal for power and leadership elsewhere  in exchange for sabotage.  And how much more effective to do it in collaboration with the State media, ever hungry as they are for dirt.

But here is the surprising thing. RP as an organisation , as Aware did before them, similarly survived with its democratic nature intact and went on to field 11 candidates in GE 2011.  So maybe democracy is not the greatest weakness of a   political party but its greatest strength in the long term.  Certainly many commentators like Alex are now seeing the cadre system as responsible for hampering progress within the PAP and its greatest obstacle going forward.

What next in 2012?  Well the PAP cadres have concluded their convention and business goes on as usual within their closed circles.  There has been a lot of talk of Opposition parties joining forces in a grand coalition as well as of new parties being set up. However the important question for voters should be whether any of the parties are genuinely democratic. I would not wish the RP to merge with another party for example, unless that party were also to adopt a democratic constitution and abandon the cadre system.   My fervent wish for 2012 is that any new party set up will be Democratic and that through openness and with competition fostering progress we will go forwards as a Nation and not backwards. We need to change the old Singapore/PAP influenced Model so that we can have a better future.  As always I am daring to imagine a new rice bowl for an advanced Asian nation.

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You’ll be dead before you can spend it! Singaporeans enter the 20th year of unnecessary, self -imposed austerity.

Nov 29

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Watching the Euro-zone unravel has so far almost been like a moral fable for Singaporeans.   Be honest! Who out there isn’t feeling a sense of Schadenfreude? The original Greek or Irish problem on the periphery of Europe and investor flight from European sovereign debt has spread via Spain and Portugal, to Italy and even France, Austria, the Netherlands and Finland.

This moral fable could be said to illustrate the dangers of profligate governments who have bought electoral popularity with populist policies and high levels of welfare spending and are now paying the price.  As an economist I would say that the only certain moral to this story is, ‘beware the folly of entering a currency union without a fiscal union’.  The rest is open to debate.

In a desperate attempt to stave off default and unlock emergency funding from the ECB and latterly the IMF, those beleaguered states have agreed to scale back their generous social welfare programmes, increase existing taxes and impose new taxes. All of this results in an externally imposed, endless round of “austerity” budgets. As I write it is not only the financial axe that is being wielded.  The Euro-zone governments are discussing a solution which will essentially involve a loss of political and economic sovereignty by the countries facing insolvency.  This prompted one friend to say that the Germans, by having the most competitive exchange rate when entering the Euro (coupled with a high level of productivity and skilled labour) have achieved a mastery over Europe where Hitler failed.

However, the solution being imposed on the weaker economies would be likely to condemn them to years of lost output and slow growth as compared with higher levels of output and employment in the stronger countries. Without a true political union, which is unlikely to be acceptable to the richer Euro-zone countries such as Germany, it is difficult to see how the currency union can survive longer term.

According to the popular logic of the anti-populists such policies as free health care, free education and old age pensions, lead to a lazy workforce that demands uncompetitive levels of wages.  Thankfully for us our wise government has never fallen for the easy route of giving the people what they want (or need or deserve). On the contrary they have ensured that Singaporeans have been kept on an austerity diet almost since independence.   Pity the struggling European economies but don’t forget to look in your own backyard when you shed a tear.

We have very little welfare spending (except the ‘ give-aways’ at election time when the government throws around money away in an untargeted manner) and one of the lowest expenditures as a proportion of GDP in the developed world on education and health.  Let me repeat that.  One of the lowest public expenditures as a proportion of GDP in the developed world on education and health.   As we know the expenditure in terms of private money coming from your own pocket is very high indeed with exam success being directly correlated to expenditure on tuition. In Singapore we are proud to have developed a world class system of ‘hire ‘education. As well as the private financial burden we have the devastating personal social costs of long term medication and care required for old age, cancer, chronic illness or disabilities both physical and mental.

Despite the government’s harping on how this has resulted in low taxes for median-income Singaporeans compared with Europeans, these income groups are not really any better off. Europeans generally receive free health care and completely free education -which is mostly compulsory up to the age of 16. (a vital child protection safeguard).  Singaporeans have to pay for medical care with Medisave and Medishield and are often forced to top this up or go without treatment because of gaps in coverage or inadequate savings.  We also work up to 50% longer hours to achieve living standards on a par with the less affluent Euro-zone countries.

The end result of this scrimping and saving is familiar to all. The Government has run huge and persistent surpluses as a proportion of GDP(between 5% and10% of GDP though in 2007 it was considerably higher than this) for over twenty years. This includes revenues and receipts from current and past reserves as well as revenues from land sales and capital receipts. I believe it is misleading to exclude these revenues and receipts from the Budget.  The Government further disguises its exceedingly comfortable fiscal position by using an accounting convention of subtracting both current and development expenditure from current revenues. It then adds back only (at most) 50% of the revenues from the Sovereign Wealth Funds, Temasek and GIC.  Our Opposition needs to demand a proper accounting

The high levels of government saving are partly responsible for a current account surplus of over 20% of GDP. Because the MAS intervenes to prevent the Singapore $ rising too far, this is reflected in the growing holdings of official reserves and the overseas assets held by our Sovereign Wealth Funds, Temasek and GIC.  It is true that Singapore has avoided a situation where the Government has had to issue foreign currency debt and in fact has a substantial net asset position (particularly when its ownership of 80% of the land is included!). The benefit is that we have avoided the problems of the Euro-zone where the deficit countries are being forced to cut back on spending and raise taxes.

But is this a good thing and does it make our government fiscally wise? In a way that is like saying that a starving man has avoided having a starvation diet imposed on him by voluntarily deciding to impose it on himself first.   Some of you will be acutely aware that those holding the food supplies make sure they themselves have a very rich diet. The wonder is that whilst they earn  millions of dollars for cabinet roles you agree to tighten your belts, take on extra work, move dad into the corridor, rent out your rooms and die slowly without the dignity of care and medication.  If you are still feeling smug bear this in mind. Even with cutbacks the countries embracing austerity programmes will still have almost free public health and education while Singaporeans do not.

There is really no justification for the continual accumulation of reserves and government surpluses once these have reached a level sufficient to provide for a serious crisis. Our Government passed this level some years back but continues to insist on its necessity. Meanwhile CPF holders are being forced to take unilateral changes in the terms on which they can get their money back. This is despite the low returns on  CPF savings having been one of the major contributors to the growth in overseas assets. The present generation of Singaporeans has been robbed, supposedly to pay for a future generation of Singaporeans, despite accelerating technological change and productivity growth making all but certain that future generations will be much richer than the present one.

The big question is will we even benefit from our enormous overseas assets? I believe we are fooling ourselves if we think that by actually saving all this money we will get to spend it or that our children will.  GIC, Temasek and MAS have yet to come clean on how much it has invested in Euro-zone sovereign debt and how much it stands to lose should there be a debt default in the worst case or just a restructuring.  As I said before, there is no-one in Parliament willing or able to demand an account.

Presently the countries that have run large current account deficits for many years, such as the US and many members of the Euro-zone, are acutely aware that the counterpart of their deficits is excessive saving in the surplus countries, mainly China but also Japan, Korea, Germany and of course Singapore. They know this prevents them from being able to achieve satisfactory levels of growth, output and employment. The Euro-zone has already turned to China and asked the Chinese Government to buy more Euro-zone debt. This has allegedly infuriated many ordinary Chinese who complain about how poor they are compared with the average European. Their anger should be directed at their government which has held down consumption and domestic living standards to create a level of reserves far higher than necessary. This has allowed a situation in which they now find themselves held hostage to the debtor nations. It is likely that our Government faces the same pressures from the EU to invest in bailing out the insolvent members of the Euro-zone.

It would be far better if our reserves were spent on benefiting Singaporeans in the first place rather than hijacked by political considerations.  That is why I have consistently called for a reduction in our general budget surplus, measured as widely as possible, to a much lower figure, say under 1% of GDP over the course of an economic cycle. The funds could be invested in basic improvements to Singaporeans’ health and education as well as cutting taxes.

I have also called for the privatization of Temasek and GIC with the distribution of shares to Singaporeans. If they are owned directly by the people then it will be more difficult for them to be held hostage to foreign political pressures.

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