Ministeria​l pay – a view from the outside

Dear Straits Times,

I refer to the 16 Jan 2012 letter by Mr David Grant.

Mr Grant offers Singaporeans an outsider’s view of the political wage issue. What Mr Grant offers is not the general outsider’s view but one American’s perspective only. There may be countless other Americans who think otherwise. Even if it is the typical American perspective, it may not be the Swiss, German, Dutch, Finn, Danish, Swedish, South Korean, Japanese, Taiwanese or Hong Konger perspectives.

Mr Grant claims that most outsiders see Singapore as a well-run company with fortunate citizen shareholders. Unless Mr Grant has commissioned an independent survey to seek the views of outsiders, not just outsiders dependent on Singapore jobs, he is better off speaking for himself. He regards our prime minister as the CEO of the company that is Singapore with fellow MPs as board of directors. Mr Grant’s analogy, while deceptively appealing, distorts the truth about the relationship between the prime minister and MPs as well as their contributions. While the CEO kowtows to the board of directors, the prime minister doesn’t kowtow to the MPs. Also, while the CEO presides over everything in his company, the same can’t be said of the prime minister. Does the prime minister preside over what happens in Cold Storage or 7-11? Furthermore, even if we say that the prime minister can influence the decisions of government linked companies, he can only do so through his wife, the CEO of Temasek Holdings. At most, we can only say that the prime minister is the CEO of the civil service and associated statutory boards. To put the issue in US terms, it is like saying that Barrack Obama is the CEO of the US and that he used to employ Steve Jobs. Even though Steve Jobs is now gone, there is no need for people all over the world to mourn his death because Apple Computers can continue to seek direction from the CEO of CEOs, Barrack Obama. That is how preposterous Mr Grant’s ‘outsider’ view is.

Mr Grant claims that Singaporean shareholder value has increased through higher home prices, better wages, better opportunities and international recognition. Mr Grant should understand that increase in home prices is on paper only. If all 1 million HDB owners were to cash out on their higher home prices now, where are we to find another 1 million Singapore households to buy those flats? If all 1 million HDB owners want to sell their flats now, home prices would simply crash. All 1 million HDB flats can be sold eventually, albeit to future generations. Thus, higher home prices if ever realised, is not wealth created but wealth transferred from future generations to present generations.

For the bottom rung, real wages hadn’t been better. For the middle rung, real wages hadn’t been significantly better. Perhaps Mr Grant is referring to the Singaporean top echelon when he refers to better wages. Same goes for better opportunities. Mr Grant should also understand that Singapore was already well-known internationally as a bustling port city even during colonial times.

Mr Grant claims that it is a bargain to receive a 40% discount in ministerial pay. As with many discounts, the price is jacked up before discount so that the seller ends up with the last laugh. If the price was jacked up 300% and then discounted 40%, consumers end up paying 180% instead. There is no real discount at all.

Mr Grant claims that it is better to have ‘clean wage’ pioneered by Singapore compared to money politics handcuffing Western democracies. He supports his claim with the American example of corporate lobbying in the US. The American example is not exemplary of Western democracies because corporate lobbying is less serious in Europe. The notion of ‘clean wage’ is meaningless as long as the amount is not fair. What constitutes a fair amount should be decided by the people, not a committee that comes mainly from privileged backgrounds.

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2 Responses to “Ministeria​l pay – a view from the outside”

  1. johor Says:

    alright then, let the personal income and company taxes in S’pore be double and you can be sure that most of the companies (big and small) in S’pore will be relocating to malaysia within 6 months. are you happy now ?

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