About a mpnth ago Shanmugam went on a rant against The Economist in response to a very mildly critical article published by their Banyan correspondent. While generally adulatory and undeservedly respecctful, Banyan had mentioned, to give one example, that young people in Singapore were concerned about the “gargantuan” reserves which have been accumulated and continue to be added to without the Government providing any clarity over how this would ultimately benefit Singaporeans. I found that amusing because Banyan had used exactly the same adjective I used in a blog post about a week earlier (see here). Banyan had also cited a “docile” press and severe restrictions on the Opposition, along with good governance, as reasons why the re-election of the PAP was a foregone conclusion.

In the past any criticism of Singapore, however miild, by The Economist or foreign newspapers, has usually sparked a dreary pages long diatribe from the Government which they are forced to carry in full or risk being banned or having their print circulation curtailed. Obviously this was more of a threat in the pre-internet age but nevertheless The Economist has always complied, prompting one memorable letter from an American subscriber asking why the Letters page was taken up with this garbage from Singaporean officials. Recently the Government threatened to cancel the visa of the Singapore correspondent over an article about Ridout Road pointing out that whatever the legalities of the situation the optics were terrible.

The Economist clearly learnt its lesson because there was no mention of Ridout in Banyan’s article. Nevertheless this did not stop Shanmugam from expressing his displeasure on his FaceBook page. His rant was full of fallacious arguments and the misuse of selective statistics to try to buttress his case about how well Singapore had performed compared to the UK since independence. Along the way he took sideswipes at the supposed corruption of Boris Johnson with false claims that this would never be allowed in Singapore. It’s extraordinary that Shan chose to call the former PM of one of Singapore’s major allies and enablers corrupt. This is particularly so given the PAP’s selective ban on supposed interference in domestic politics, which in practice is defined to only be coverage critical of Singapore or supportive of the Opposition.

Given that Shan’s tirade against the UK attacked the current Conservative Government, almost certain to be replaced by a Labour one at the next election, it’s plausible that he received help from a UK media consultant with links to the Labour Party, who would be delighted to see the Tories attacked as corrupt by a senior Cabinet Minister of one of the UK’s closest allies. I was suspicious when someone sent me a recent podcast by Alastair Campbell, Tony Blair’s former spin doctor, singing the praises of the PAP compared to the Conservative Government and in a display of sickening sycophancy, actually reading out Shanmugam’s post online. My questions were answered when I did a quick Google search. Thia revealed that Alastair Campbell is a senior adviser to (and presumably owns shares in) Portland Communications, a PR agency which has offices in Singapore as well as London and New York. It seems likely that Portland gets contracts from the PAP and state-owned companies in Singapore which would go a long way to explain Campbell’s unbridled admiration for a country that has no respect for human rights. While he is quick to condemn others like Boris Johnson as corrupt, until he reveals what revenues Portland receives from Singapore bus, it seems likely that he’s just the pot calling the kettle black.

So down to the specifics of Shanmugam’s rant. He claims that it’s somehow a merit that Singapore has had only 4 PMs since independence. In fact it’s only 3, since Lawrence Wong did not officially take over till 15 May. However he omits to mention that out of 59 years only 14 have been with a PM outside the Lee family. Furthemore it was already clear that Goh Chok Tong would only be an interim PM, a seat warmer to LHL, even before he took over and throughout his tenure he had the father, LKY, as Senior Minister, checking his every move. That’s why Singaporeans refer to them as “the Father, Son and Holy Goh”. If the length of tenure and lack of opposition is a merit then Campbell should praise Stalin, Mao and Putin. At least in both China and the Soviet Union their dictators didn’t try or were unable to establish dynasties. As a professed Socialist, it seems strange that Campbell should think dynastic rule and the Divine Right of Kings is a superior form of government to democracy.

Shanmugam goes on to say that Boris Johnson would have been charged in Singapore for accepting a holiday and renovations to his official residence paid for by a Tory donor. However he disingenuously fails to mention that both LHL and LKY received discounts, which were substantial amounts in today’s money, on the purchase of properties in Nassim Jade, from Ong Beng Seng’s company Hotel Properties Limited that were not available to the general public. They weren’t charged but paid back the discounts. However even without the discounts the price paid was pre-launch and the sale was not open to the general public, rather like an IPO price that is much lower than where the stock opens once it begins trading on the open market. On the subject of renovations, Shanmugam also got the government, not a donor, to pay for extensive renovations of approximately $500,000 when he rented 26 Ridout Road. I accept that Shanmugam has been cleared by the Corrupt Practices IInvestigation Bureau and that the Singapore Land Agency would have had to bear the cost of renovations no matter the identity of the renter. Similarly 10 Downing Street is not the UK PM’s private residence and the benefit of any reservations accrues to subsequent occupants, just as it does in the case of 26 Ridout Road.

Then Shanmugam cites Singapore’s growth in per capita GDP in Purchasing Power Parity (PPP) terms from US$500 in 1965 to more than US$80,000 now. PPP dollars are not something you can use in international trade so I would prefer to see a comparison at current market prices. On growth in per capita GDP at current prices, Singapore is beaten by Ireland whose per capita GDP, starting from almost identical levels in 1989 had risen to US$106,000 in 2024 while Singapore’s is estimated at US$88,000.

Ireland is a good counter to Shanmugam’s arguments because like Singapore it has pursued a strategy of attracting MNC investment by having very low corporate tax rates. Much of the booking of revenues is driven by tax avoidance strategies and doesn’t reflect real economic activity. Paul Krugman famously dubbed Ireland’s spectacular economic growth statistics as “leprechaun economics”.Previously Gross National Income (GNI) adequately captured the real national income of a county by adding in income from abroad but excluding income due to foreigners. However that’s no longer the case now that many MNCs have moved their legal HQs to Ireland (or Singapore). One solution is to exclude exports and imports and measure modified domestic demand. Another would be to exclude the retained earnings of MNCs but include international trade. This modified version of GNI (dubbed GNI*) shows the true size of the Irish economy to be only slightly over half that measured by GDP. I am unable to calculate GNI* but Singapore’s net trade surplus has risen to 37% of GDP in 2023. Excluding that would mean the true size of the Singapore economy would be less than two-thirds that measured by GDP. So a truer measure of national income per capita might be around 60% of the current level or US$53,000 rather than US$88,000.

This is corroborated by the figures for consumption which is a better measure of how well off the population is though still flawed. Recently I pointed out that the share of consumption in GDP had declined to 31% in 2023 from 37% in 2013. A global comparison of final consumption expenditures using 2015 prices from the World Bank shows Singapore to be well behind the UK, US, Switzerland, Norway, Luxembourg, New Zealand, Sweden, Iceland, Finland, Denmark, Canada, Bermuda, Austria, Australia, the US Virgin Islands and Hong Kong though ahead of Ireland and much of Europe while on a par with Israel and Germany.

Another reason why the comparison with Ireland is particularly apt since Ireland’s population is only about 5 million so about 10% smaller than Singapore’s. Singapore has no rural sector though so the comparison is already unfair. Shanmugam compares Singapore with the UK which has a population of about 68 million but still has a level of consumption that is substantially higher than Singapore’s. A fairer comparison would be of cities or metropolitan areas. Singapore’s GDP per capita is would place it outside the top ten US metropolitan areas and far behind San Francisco, San Jose, Seattle New York and Boston.

There are other reasons why Singapore’s GDP per capita figures should be taken with a pinch of salt. Because of the high number of migrant workers without dependents compared with other developed countries (nearly 40% of the total labour force), who will be sent home as soon as they lose their jobs, Singapore has an unusually high ratio of employed workers to total population. Coupled with the fact that Singaporeans work some of the longest hours in the developed world, only exceeded by South Korea, this exaggerates GDP per capita. It’s more relevant to look at GDP per hour worked. For 2019, Singapore’s GDP per worked adjusted for PPP was US$54 an hour, about the same as the UK but lagging well behind the US on $74 and less than half that of Ireland on US$125. Most of Europe came in above Singapore, even Spain and Italy. Singapore was ahead of Hong Kong, Japan, South Korea and Taiwan though if only the metropolitan areas of the latter three were taken output per hour worked would probably be much closer to Singapore’s. Ireland’s GDP per hour worked is inflated in the same way as its GDP per capita and GNI* per hour worked would be a more appropriate measurement. This would be about US$65 per hour while Singapore’s would probably be around US$32 or less.

Shanmugam’s boast about GDP per capita is even more ludicrous if one looks at the level of wages and purchasing power. Singapore has no minimum wage and competition from cheaper foreign labour ensures that many Singaporeans work for well below what would be minimum wage in other countries. For example in the UK the minimum wage works out to about $19 per hour. In many American cities the minimum wage is considerably higher. Singaporeans also pay more for most consumer staples than workers in the UK and much of Europe, as I showed here.

On media: Shanmugam conveniently forgets to mention that almost without exception Singapore’s media is all state-owned and tightly controlled with none of the independent safeguards that apply to the BBC, which the UK Conservative Government is forever accusing of anti-Tory bias and which faces a high level of competition . In Singapore the few non-state owned new sites are tightly controlled with a raft of repressive legislation including the Protection from Online Falsehood and Manipulation Act (under which I’m facing prosecution), the Foreign Interference Countermeasures Act (FICA), criminal defamation (abolished in the UK) and civil defamation laws and sedition. It’s especially ironic and hypocritical of Shanmugam to talk of media owners influencing “who gets elected” when state media basically functions as a re-election team for the PM and the PAP, paid for by the taxpayer now directly because it’s so disliked by Singaporeans that it can’t make money from sales or advertising. Democracy doesn’t even exist in Singapore yet Shanmugam arrogantly and hypocritically lectures other countries on cancers on democracy!

On the provision of public services. Shanmugam is equally disingenuous. While the standard of healthcare may far exceed that of the UK if you’re wealthy, that is certainly not true for ordinary Singaporeans. Despite having $120 billion in compulsory savings for healthcare, Singaporeans still find themselves paying out of pocket and can be bankrupted by a catastrophic illness. This leads some to forego treatment for things like dialysis and thus effectively elect to commit suicide. This was recounted in an article in state media recently and I wrote about this in a Facebook post.

As regards housing, I am at a loss to understand how Shanmugam can claim that Singapore leads. While the PAP tout the high level of supposed home ownership, Singaporeans don’t actually own their own homes but have to lease them from the state which owns 90% of the land and thus sets prices. Housing is just another tool used by the PAP to soak up Singaporeans’ savings, depress consumption and create a surplus for investment abroad. The PAP boast of housing “subsidies” to allow Singaporeans to purchase housing at artificially high prices but this is just a sham to divert money out of the Budget and away from welfare spending. In turn the HDB buys land from the Government at these high prices and the revenues go into the reserves. Most citizens of advanced countries, including Shanmugam’s bete noire, the UK, would not put with the small sizes of HDB flats, their lack of outside space and the high levels of noise. In contrast with the UK, where a majority of people own the freehold of their properties, Singaporeans will see their investment in property transferred to the state when the 99 year leasehold is up.

On education, while Singapore’s scores are at the top or near the top of the Programme for International Student Assessment (PISA) in maths, reading and science, it’s notable that these results are closely matched by those for Hong Kong, Macao and Taiwan. As in comparisons of GDP per capita it would be more useful to compare Singapore’s scores with those of similarly high income cities globally and correct for income differences within countries. As an example, Massachussetts, one of the higher income US states, achieved results much closer to Singapore’s in 2015 than the US as a whole. Tellingly the OECD report stated that, “In Singapore socio-economically advantaged students (the top 25% in terms of socio-economic status) outperformed disadvantaged students (the bottom 25%) by 112 score points in mathematics. This is larger than the average difference between the two groups (93 score points) across OECD countries.” This suggests that Singapore is devoting more resources to the best students despite the fact that income inequalities should be lower in a city than in a large country with a substantial rural population. I suspect that the lingering influence of LKY’s belief in eugenics is to blame.

A more significant statistic is that Singapore has not produced any Nobel Prize winners whereas the UK has produced the second largest number (137) after the US (411). Size alone is not a good explanation as Sweden, Switzerland, Austria, Israel and Ireland have all produced numerous Nobel laureates. As regards university rankings, the UK has 5 in the top 10 of the QS University Rankings (including the No.2 and 3, Cambridge and Oxford respectively, more than the US which has 4 while Singapore has only one, NUS, which only entered the top 10 in 2024. It’s strange that it would rank so highly since NUS has no academic independence like the other top universities but operates under direct Government control.

On law and order, Singapore may have a good record as regards public safety but it has a long history of financial frauds and, if not welcoming, turning a blind eye to money laundering by foreign criminals and state officials in the region. While Shanmugam may be proud of Singapore’s record of executing even people of subnormal intelligence for smuggling drugs (including a recent case where someone was sentenced to death for possessing about 500g of cannabis), Singapore’s judiciary and AG take a much more lenient approach to actual murder, particularly where the culprit is from a higher income strata. I have commented elsewhere on some of these cases. The Government refuses to disclose the inmates on death row but they are overwhelmingly poor and brown skinned foreigners or ethnic minorities, and there for drug related crimes not murder. While the Government doesn’t publish statistics, sentences seem much harsher if the person is from a lower income group or an ethnic minority.

As regards racism and social cohesion, Shanmugam brings up an isolated example from the UK, of someone who was not even a politician but omits to mention that the first PM of Singapore, Lee Kuan Yew, the father of Lee Hsien Loong, held extreme racist views. He frequently and forcefully stated, and had it published in the state media, what he said were hard scientific truths about the inferiority of non-white and non-Chinese races. Shanmugam said that a person who said what the Tory donor did, that Diane Abbott, a Labour MP, made him “want to hate all black women”, would have been charged in court. Why then was LKY not charged but instead his racist crackpot theories were held up as deserving of respect and called hard truths? There have been numerous other examples including a PAP MP who in the 1990s said in Parliament that Little India was already dark by 3pm on a Sunday because of the large number of migrant workers congregating there. This institutional racism has continued in the utterances of Lee Hsien Loong and DPM Heng Swee Keat that Singapore is not ready for an Indian PM as well as in the composition of government scholars who have been overwhelmingly majority race well beyond their percentage in the population. While the UK has an Indian PM, Singapore does not have a single ethnic minority or even woman in the 4G leadership team.

Shanmugam should not be allowed to get away with his disingenuous comparisons. The PAP have tried to fool Singaporeans and the world that GDP per capita should be treated as a proxy for the living standards of its citizens. Like the Soviet Union, which wanted its citizens to think that Dickens’ novels were an up to date reflection of living standards in the UK, the PAP Government tries to suppress or alter other measures which paint the purchasing power of our citizens in a less flattering light. For instance UBS were persuaded to drop Singapore from its survey of Global Cities after its statistics for purchasing power put Singaporean workers on a par with the workers of Kuala Lumpur and Moscow back in 2011. Supposed economic out performance has long been used as a justification for suppressing democracy and human rights and keeping secret basic facts like the amount of the reserves or even how much the PM’s wife was paid as head of the sovereign wealth fund, Temasek. Many in the West fall for these falsehoods, either through self-interest like Alastair Campbell whose company has an office in Singapore and undoubtedly gets government or state company contracts, or through a desire to use what they perceive as Singapore’s success to attack their political opponents or justify their bad decisions. Thus the Labour Party wants to use Singapore as an example of the success of what they see as socialism, with state ownership of land and most of the economy, while glossing over whether this has translated into higher living standards for the masses or curbed the rise of income inequality. The Conservatives have long misleadingly pointed to Singapore as an example for the UK after Brexit while conveniently forgetting that the lack of a minimum wage and employee rights coupled with the ease of bringing in foreign labour would make it electoral suicide for any party proposing it. Holding down Singaporeans’ consumption and channelling savings into the accumulation of foreign assets gives the PAP Government a lot of firepower into buying friends and admirers around the globe as does the ability to offer fantastic deals on tax breaks to MNCs. Hopefully my refutation of Shanmugam’s false and preposterous claims will set the record straight but unfortunately there appears to be much invested in the myth of Singapore’s exceptionalism under the Lee dynasty and the PAP.

Published by kjeyaretnam

I'm a Singaporean economist who became an opposition activist. I blog to provide an alternative to the porkies that the Pinkies tell. It just so happens that my alternative is the truth. That's why I've never been sued in any civil or criminal court no matter how hard hitting my criticism. I'm quoted and interviewed and asked to speak across the world but largely censored in Singapore in an effort to silence my political opinions. The left hate me because they think I split their vote and because I eschew their outmoded economic models. Models that don't work. The Right and the Conservatives hate me because I'm a liberal. I'm not sure what the middle think of me. I don't think there are more than a handful of people in the middle, here in Singapore. I'm a Singaporean born and bred, dual heritage, my parents Singaporean established here before the State of Singapore was created. I'm not Eurasian. I read economics at Cambridge and could be broadly described as from the Keynesian school but I believe in interventions. I was formerly a successful hedge fund manager. After economics and politics my greatest interests are history, film and Makan. I run but I run so I can eat like a Singaporean. View all posts by kjeyaretnam