The last few days LHL’s personal propaganda broadsheets, given monopoly protection in order to keep him and his family in office and drawing millions, if not billions, from state funds in the world’s best welfare scheme, have been reporting on the all too common case in Singapore of a young couple who took $32 million in payments for luxury goods (Rolex and Patek Philippe watches, Hermes Birkin bags) and then never delivered the goods. The headline was ”Young couple ‘uncontactable’ after failing to deliver luxury goods worth $32m, 200 customers left in lurch” . The couple’s rented luxury landed property on Holland Road is now empty as is a shop they used. Of course the couple have undoubtedly long ago left Singapore and are probably lounging on a beach somewhere.

In hindsight it is of course easy to see how stupid those scammed were. Blinded by greed and what seemed like an easy arbitrage profit, they handed over huge sums of money directly to the couple with no safeguards. One of the victims was quoted as saying that he had dinner with the couple several times and how they had got on really well. Given that most of the victims seem to have been ethnic Chinese, it might be that cultural factors, such as a tendency to be overly trustful of people who look like you, might have played a role.

However while Singaporeans might laugh at the gullibility of those who fell victim to this particular scam, the majority of citizens are even worse. For while the victims of the watch scam thought they were cleverer than everyone else and found what seemed to be a guaranteed profit difficult to resist, the majority of Singaporeans have, by electing a government with no effectively no checks and balances on what it does with the money it collects , shown themselves to be even stupider. That is why I have rephrased the headline about the watch scam to reflect what Singaporeans have allowed to happen with the country’s reserves which have been paid for with years of austerity.

Since 1970 or even earlier the Government has run Budget surpluses every year with one or two exceptions. If we use the IMF definition of the Government surplus rather than the fake accounting used by the Finance Minister to hide the real surplus, these have been substantial. However this is only half the story as it does not include the wider Government surplus which adds the profits of Government owned companies and statutory boards such as Temasek, GIC, MAS, Changi Airport Group, National Healthcare and SingHealth, only dividends paid to the Government. Just the Government surplus alone has been at least $500 billion since 2000.

On my calculations, which I have set out elsewhere, the Government should have at least $2-3 trillion in assets net of Government debt. It was probably over $3 trillion before the market sell-off but may have fallen by 30% or so as a result but still should be over $2 trillion. That is over $500,000 per Singapore citizen. This figure does not include the value of the 80-90% of the land it owns in SIngapore. As the value of your HDB flat, missold to you as an asset enhancement strategy, goes to zero the loss to household balance sheets will be matched by a corresponding gain on the asset side of the Government’s balance sheet.

Yet Singaporeans have derived zero benefit from what should be huge reserves. Even using the Government’s deliberately fake definition of the balance in the Budget, which excludes any revenue from land sales and the reserves apart from the Net Investment Returns Contribution (NIIRC), surpluses, often substantial have been the norm. Heng, the then Finance Minister and my second-class degree holder colleague from Cambridge, claimed that the Government ran a substantial pandemic-related deficit in 2020. But this was largely fake and if the wider definition of the Budget balance was used, could even have been a surplus. As I have highlighted in past Budgets, the contribution from the NIRC has been bogus because it has been mirrored by transfers to Endowments and Trust Funds, which are not real spending and largely unaccountable. The Finance Minister has responded by reducing the transfers but rapidly ramping up spending on items like Health, where the Budget allocation has grown to close to $20 billion this year. This, as I have pointed out, represents almost as much per Singapore citizen as the UK NHS spends per capita. Yet Singapore requires its citizens to pay every time they visit a doctor or require an operation and severely limits what can be paid for with Medisave and Medishield, both of which are in substantial and growing surplus. I suspect but that inflating the Health Budget, and perhaps the Education and Defence Budgets as well, may be a means of transferring money fraudulently to Temasek and GIC or ensuring through round tripping transactions that take place on paper only that no money ever comes out of the reserves and only money goes in. perhaps to cover losses. If Ho Ching’s remuneration as head of Temasek was tied to the returns, then she was incentivised to take risks with your money. Temasek’s claim that she was the only the fifth highest earner in her last year as CEO may have been because her salary was deliberately stepped down while she took out billions in what private equity pros call carried interest, rolled up bonuses and the returns on them, from the Temasek pension fund.

The fact that year after year the Government takes from SIngaporeans and puts more money into the reserves, while no money ever seems to come out, suggests that the real scammers are not the couple who were only able to make a relatively paltry $32 million, but LHL, his wife and his Government, who have conned Singaporeans out of more than $3 trillion that should belong to them with the claim that their money is safe and being saved for a rainy day. It’s time to put an end to one of the greatest con tricks in history and find out what’s really going on with our reserves.

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