In Defense of the PAP (Part 1)

When did this happen? It used to be that if you spoke up against the PAP, you feared for your life. But now online sentiment for the PAP has turned so overwhelmingly negative that I'm afraid to post this!

But what’s of note in this election is that my friends have the courage to stand up and say what they believe in, so I must do the same.

I am pro-PAP, but not a member. I am an entrepreneur, an employer. I am 42 years old, a father of 2. I live in a HDB flat. I previously worked in the finance industry for 11 years and was at one time a licensed investment adviser in Singapore, Hong Kong and Malaysia. I have written on economics, business and politics in various publications.

This is my defence of what the PAP has done. At the end though, I present my main criticism of the PAP.

Foreign Workers

Forget the “Swiss standard of living”, we are fighting for our survival. We are surrounded by third world countries with cheap, hungry and hard-working labour. In the 1990s, businesses were leaving Singapore in droves to set up in Malaysia, Vietnam and China. The business owners complained that Singapore was too expensive to do business in. Singaporeans wanted “lifestyle”, and eschew late hours, low pay and hard work. We want to be paid a high salary, and yet leave at 6pm to have work-life balance. We want to sit in air-con offices and not sweat in the sun. We want benefits for mothers, fathers and older workers. We want companies to provide child care, medical care and long (paid) compassionate, maternity and paternity leave. We want a lot of things. It is not wrong to want these things. But from the point of view of employers and investors, their response was basically this: “No thanks, Singapore. I’d rather set up in some other country and maybe hire a few high value Singaporeans to move and work there. Maybe.”

So the PAP government said “Please still come to Singapore. We’ll let you hire the low cost, hard-working foreign workers that you need, and give you land subsidy, tax incentives etc .” And the businesses came back. Some of those that are more labour-intensive ended up with a higher percentage of foreign workers. But a good number of higher value jobs, those in the air-con offices, like marketing, accounting and finance, legal, design, operations etc., went to Singaporeans.

This is at the low end. At the high end, the foreign businesses said “Look, Singapore has got some good people, but not those at the very high end. Not the mold-breaking engineers, not the Nobel Prize winners, not the think-outside-the-box industrial designers. We need these people.” So the PAP said “OK, let’s bring in these foreign talents (FT) as PRs. They will impart skills to our people. We will also change our education system, add more universities and research facilities, to try and achieve this. In time, we hope to produce our own Nobel scientists.” And so the high end MNCs came also.

Many Singaporean SMEs benefitted from the presence of these MNCs by providing products and services to them, creating more jobs for Singaporeans and opportunities for Singaporean entrepreneurs.

It is not the PAP who has suppressed wages for Singaporeans. It is global competition. The third world, hungry low cost worker, is suppressing wages and causing jobs to be lost in the U.S., Europe and Japan, not just here. If we do not offer some low cost workers, and do all we can to woo these multinationals or even simply to persuade our OWN local companies NOT to set up their operations overseas, we will lose a lot of Singaporean jobs.

Who are these foreign workers? They are construction workers, ship-builders, domestic workers, nurses, cleaners, garbage collectors, chambermaids etc. How many Singaporeans can we find for these jobs? Singaporeans are getting more and more educated and all of us want to be supervisors and managers, and this is good. But who would we manage and supervise? Yes, the FTs have taken away some jobs that otherwise could have been done by Singaporeans, it’s hard to finely calibrate these things; but on balance, their presence ensures that businesses, and cushy, well-paying jobs, remain here and create plenty of opportunities for local SMEs.

Housing policy and overcrowding in MRTs

The cause of the increase in prices for HDB flats is shortage of supply. The demand has gone up with more people on the island, but the HDB has only just started building flats. The solution is to create a lot more supply, and this is already in the works. With higher supply, prices should mitigate.

Many economists will tell you that in the short term, there are often imbalances between demand and supply which will lead to distortions in prices. I believe that the price distortions will swing in the other direction in 3 years time, when there would be too many houses to meet demand (particularly if demand is being curbed, following the elections, if foreigner inflows are curtailed). Over the long term however, the government’s policy should be geared towards managing these swings, match supply and demand, and ensure a slow, and affordable increase over time.

Could the increase in foreigner inflows and the number of flats be better coordinated? Perhaps. But it is very fast to approve foreign worker permits, particularly when key MNCs are pressurizing the government for them, and especially when the financial crisis was upon us, whereas it takes a few years to build flats. This mismatch has caused prices to skyrocket.

It is the same with the MRTs. More lines are being built,
but they take a long time.

Investment losses by the GIC and Temasek

It is not right to pinpoint a specific year when it comes to investment performance. The long term performance needs to be considered. Even Warren Buffet, the world’s greatest investor, lost billions in 2008, like GIC and Temasek did. But he continued to invest, just as GIC and Temasek did, and they  recovered their losses when the recovery came in 2009 and 2010. The long term performance of GIC and Temasek has been commendable (based on the data that they released). An NSP candidate did a simple calculation on Citigroup’s share price and concluded that the government lost billions on that share alone. This is incorrect. Citigroup went through a complex share dilution in 2009 which caused its share price to plunge. But the Singapore government got a sweet deal and made billions in profits from it. Maybe the issue here is more transparency on what GIC and Temasek does, but let the issue be transparency, not making losses.

Flooding and escape of Mas Selamat

I believe these to be civil service lapses, not political ones. As it is with the Nicoll Highway collapse, electrical outages, and the likes. Heads have rolled at the civil service, as we’ve read, but I’m not clear what some opposition parties want. Is it that we must have ministerial resignations for these mistakes? The international community and most Singaporeans would feel very unnerved if a minister resigned every time some mistakes like these occur.

Cost-of-living increases

A lot of the increase comes from the increase in prices of food, oil and other commodities in the global marketplace, which we import. A part of the reason is the tremendous liquidity that has been created by world governments to combat the financial crisis. Some of this liquidity found its way into the prices of some commodities. Climate change and fuel substitution also contributed. The MAS is trying to mitigate this by letting the Sing Dollar strengthen. Perhaps the issue is how we help the lower income cope, rather than say that the PAP has caused the increase.


The ministry overspent on this; that is fact. The question that has been asked is “where is the accountability?” I’m wondering, “what kind of accountability should there be?” The ministry has already offered all the facts. In my view, it was the first time this thing called a YOG was organized anywhere in the world, our most important priority was to pull it off properly. In this case, it resulted in overspending. But compare this to the F1. It was also the first time a night race was held anywhere in the world, and there, the results were better than we projected. I appreciate the risk-taking nature of our government in these events. We want our government and our children to be adventurous and entrepreneurial, we must accept that mistakes will be made. Under-budgeting, as any entrepreneur will tell you, is very real in any new, untested venture. Are we telling our government to only do things when they have 100% confidence, and not risk making any mistake? That’s what kiasu is, and we don’t want that.

Main criticism of PAP

For a lot of my friends, it’s the arrogance. They may believe that the PAP is the best party to run the country, but they are voting opposition anyway because they have had enough of the arrogant PAP style. That’s heart over head, but that’s what we are like as human beings. Our minds will be closed to the best logic if our hearts are not there. We will accept the most perverse logic, even to our deaths, if our hearts are won. And politics is about winning hearts, not minds. So for my friends whose hearts are lost to the PAP, even if Pullitzer prize winning arguments are presented here (or estate upgrading), it is of no use.

That arrogant style was actually appreciated by an earlier generation of Singaporeans, who were less educated. It wasn’t called arrogance then. It was called strength of conviction, it was called leadership. It was called decisiveness and resolve. In the 60s to the 80s, we needed those qualities in a leader, in our leaders.

But the electorate is a lot more educated now, and there are a lot of well qualified people who can run the country very well. Their response is “look, if you cram another hard truth down my throat, I am going to stand up and take away the ruling mandate away from you.” And that is precisely what a few very qualified candidates are trying to do now, representing all the other Singaporeans who have had it up to here with the “I-know-it-all, you-just-listen-to-me” style. For the previous generation, the PAP may have been the only answer. It is not so with this generation.

Can the PAP be less arrogant? I think PM Lee is trying, as we can see from his apology yesterday. Is it too little too late? Will the PAP really change in the future? I believe in PM Lee’s resolve, but that’s just me.

What are my views about the opposition? On an overall basis, I don’t think that a multi-party parliament is necessarily a better one. In fact, when we look at parliaments around the world, the multi-party ones are more often than not mired in disagreement, unable to move forward. The evidence just isn’t there. Having said that, however, I am a fan of Sylvia Lim (WP), Pritam Singh (WP), Michelle Lee (SDP) and Nicole Seah (NSP) and hope to hear them speak more often.

So what am I saying? What is my conclusion? I am not persuading anyone to vote PAP. That would be arrogant of me. I want to defend some of PAP’s past policies, especially if they were, in my mind, done right and with the interests of Singapore at heart but which have been misperceived. A few of my friends, who know me to be pro-PAP, have actually asked me to defend the PAP. Perhaps they are sitting on the fence and struggling with the decision and want to hear a different side from what is mainly circulating online now. I hope this helps.

Overall, I hope Singaporeans will vote who they honestly believed to be the best candidates for them. If this is done, I think that we, as a country, should be ok. I fear the Singaporean who says “I think the opposition candidate in my constituency is crap, but I will vote him anyway because I think the PAP is arrogant.” I cannot agree with that.

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