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I’m writing this in response to the recent controversy that has erupted following Lim Tean’s comments on a Vietnamese girl’s post and the attempt by the PAP to paint the Opposition as nativist and xenophobic. I’m certainly not in that camp but that shouldn’t stop us from applying the rules of cost benefit analysis to iimmigration in the Singapore context. Since the 1980s, when a shortage of labour meant rising wages which threatened to slow down the growth rate, the PAP have adopted a corporate friendly policy of allowing the import of foreign labour to add to what what was already a fairly open and unreciprocated policy of allowing in expats fairly easily at the executive end of the market. I have written about this frequently in the past and characterised it as a logical extension of W A Lewis’s simple model of Economic Development with Unlimited Supplies of Labour, which was the basis of the policies that Singapore adopted in the 1960s as advised by WInsemius, the Dutich economist.

Most studies have shown that immigration is a net economic benefit since if immigrants work and pay taxes they are a net contributor to government revenues. But the benefits have to flow to all sections of society and particularly the less well off. Providing existing citizens’ welfare is safeguarded through such measures as a minimum wage, employment protections, affordable and comprehensive healthcare, basic pensions regardless of CPF savings and unemployment and disability insurance, then I am unreservedly in favour of immigration.

However in Singapore the benefits from immigration have largely not been shared with existing Singaporeans. Government revenues and the reserves have benefited not only directly from the rise in the foreign workforce and the direct and indirect taxes collected but also from the enormous rise in property prices driven by population increases. This increases the value of the state’s land reserves and land sales revenues. The Government say the reserves must be safeguarded for future generations yet refuse to tell us how much the reserves are or how rapidly they are increasing.

The PAP are also being disingenuous when they talk about the welfare of future generations since our Total Fertility Rate is now below 1 (a TFR of 2.1 is necessary to maintain the population at current levels). If our population is not to decline precipitously future generations will likely consist of first generation immigrants. We can easily afford to do a lot more to improve the lives of ordinary Singaporeans. I have calculated that the financial reserves must be at least $3 trillion (with the value of state land being many times that). We can surely easily afford to spend another $60-90 billion a year without adversely affecting future generations.

In any case when the PAP talk about “safeguarding future generations” what they really mean is that they do not believe in sharing the benefits of the huge surpluses and phenomenal rise in the reserves driven by population and economic growth with you. They don’t believe you deserve to share. Their Social Darwinist philosophy can be summed up by LKY’s comments in an interview in 2009 with National Geographic when he said that “we’ve got ethnic Chinese and ethnic Indians here. The settled ones have become less hard-driving and hard-striving and we’ve got recent migrants, they are hungry, they’re determined to succeed having uprooted themselves and they’re doing better.” and then as to why existing Singaporeans are les hard-driving, “I think the spurs are not stuck on your hinds”. The PAP sincerely believe that Singaporeans must not be made too comfortable lest they grow fat and lazy. This mindset has not changed in the years since LKY’s death. This was demonstrated recently when the disgraced Speaker, Tan Chuan Jin, was caught in Parliament by the mic swearing and muttering “effing populists” in response to calls from Jamus Lim to spend more.

So while we should always welcome immigrants, particularly when they proclaim their love of their new homeland, we must also ensure that our own people are taken care of and that the benefits are shared with all income strata. Instead we have a situation in which the PAP see importing new citizens and PRs as a superior alternative to investing in our own,

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