Unless you live in a perfect country, chances are great that there is economic inequality where you live. While you may think you fully comprehend the growing gap between the wealthy and those below the poverty line, what you may not know is that it is continually growing—and at a fast pace. A great case study to observe would be Singapore. While on the outside Singapore appears to have one of the strongest economies of this decade, it too—like most countries—has its own problems.
To an outside investor, or someone looking at the information provided, Singapore appears to be the best place to be for economic success. It has a low unemployment rate, 1.9%; it has an “ease of doing business rank” of 1; a GDP per capita of $60,799, third overall in the world; and has a Standard & Poor’s, Moody’s, and Fitch, AAA credit rating. With 1/6 people living in Singapore having millionaire status, statistically, you have a better chance of being a millionaire in Singapore than in any other country. One-in-six are rolling around in millions of dollars, using their Krisflyer card to jet set around Asia, and living high on the hog; however, there is a growing gap that the other five-in-six are becoming very concerned about.
It comes as a surprise to most that a country this prosperous is the second-most unequal economy in the developed world. While the government has started to take notice, many believe that they aren’t moving quickly enough. Part of the problem is that the government doesn’t publish data on wealth inequality. Without this information, it makes it very difficult to take proper steps to bridge the gap. Another problem is that Singapore does not have a government-defined poverty line.
Earlier this year a report was published by the Singapore Management University’s Lien Centre for Social Innovation, which stated:
“The process of identifying a poverty line ... will generate greater public support for efforts to address the needs of vulnerable communities ... It will also focus the efforts of the government, social sector and philanthropists according to common indicators arising from locally identified needs.”
Furthermore, they believe that “most Singaporeans are not aware of the scale and depth of poverty in Singapore.”
As more and more Singaporeans become aware of the poverty and acquire class consciousness, the Singapore government will be forced to change their current standing on economic and social positions. In most capitalist countries, the wealthy do their part to help out by paying taxes (commonly referred to as “their fair share”). However, as Singapore does not take taxes on capital gains or estate duties, many people believe that the government is missing out on ways to help eradicate Singapore’s poverty problem.
I’m as much for capitalism as the next guy; capitalism incentivizes people to work harder. That being said, it also breeds wealth inequality. As we look back on history, there is a common pattern that occurs when a country experiences wealth inequality and class consciousness. From the 18th century French Revolution to the ongoing Arab Spring, the gap between the prosperous and the poor must be resolved or it will lead to bloodshed.
Jess Cammerman
TRS Contributor