FT : Inequality Is Center Stage In Singapore Election

Full center-page article in today's FT on the Singapore elections on May 6.  Looks like the dissenting comments are getting bolder and bolder.  Quoted are web-based chatroom comments on Lee Kuan Yew like "He should have retired in 2001 already.  Then I would have still respected him as an elder statesman.  Or retire when son becomes PM and reject the ridiculous title of MM."  I would check my CPF balance if I was this guy.

SOME STARTLING STATISTICS FROM THE ARTICLE

• Although unemployment is low at 3.4%, the rate is nearly double for those over 40 with little education. 
• A recent government survey showed that the income of the poorest 20% fell nearly 15% in nominal terms between 1998 and 2003 to an average of US$505 per month.
• Although Singaporeans have one of the world's highest rates of home ownership, at more than 90%, house prices have fallen by 30% since the mid-90s, meaning many are sitting on paper losses.
• Households in the top 20% earned about 21 times as much as those in the lowest 20% in 2000, a government survey shows. 
• In 2004 Singapore had the world's sharpest rise in the number of millionaires at 22%, according to the latest World Health report by Merrill Lynch & CapGemini. 
• Days before the elections, the PAP distributed S$2.6bn in cash as "Progress Package" payments with a focus on the needs.

SOME NOTEWORTHY EXCERPTS FROM THE ARTICLE

Singapore prides itself on a predictability born of efficiency.  Elections are no exception.  The long-ruling People's Action party, which holds all but two of the 84 parliamentary seats, will be returned with another thumping majority when the city-state goes to the polls on Saturday.  But there will be tension in the outcome nevertheless.  The near-certainty of PAP victories has turned general elections into something more akin to plebiscites gauging the public mood – and, this time, there is a new starkness to several social fault-lines that cleave Singaporean society.  Much of the PAP's success rests on 5 decades of economic achievement, which have made Singapore a model (combining an open economy with stern political control) for aspiring Asian countries, not least China….. 

The government has traditionally been sceptical about welfare spending.  The Central Provident Fund (CPF)…has proved to have weaknesses.  Many Singaporeans are asset-rich but cash-poor, since much of their CPF savings are tied up in housing…..And as those now elderly were paid low salaries when they contributed in the 1960s an 1970s, their CPF payments have failed to keep up with the cost of living.  Grandmothers, rather than teenagers are a common sight staffing the counters at fast-food outlets.  Income inequality has become a dominant issue…..

Lee Kuan Yew, who as PM from '59-'90 eradicated large pockets of poverty and developed the economy by attracting foreign manufacturers…points out that Hong Kong & the US, which per capita are richer than Singapore, have wider income disparities.  But he acknowledges that the income gap is a "very serious challenge" adding that "the country has to find a solution that doesn't go the European way" in terms of lavish social security….."If we can find a balance between not too divisive a society because of the disparity, but still stay competitive and not too highly taxed, and people keep trying to accumulate wealth and create jobs, then I think we'll be alright.  If we can't strike a compromise between those two conflicting forces, we would be in trouble."