I admire Roy Ngerng. I admire Roy Ngerng not for what he said, though I generally agree with what he said. I admire Roy Ngerng because he spoke out willing to accept the risks of speaking the truth. Much of the time when I write about Singapore, I feel like a fraud because I am not generally in harms way when writing about the enormous financial discrepancies. Roy Ngerng who faces much greater risk than I do has accepted that risk and calling.
Though I generally do not read comments on my work, I happened to browse through the comments section at TRemeritus.com a few months back and a reader asked me to write about specific issue that has haunted me ever since. To paraphrase with my interpretation, what will rouse Singaporeans from their apathy in determining their course as free men and women with God given rights?
The English philosopher John Stuart Mill stated that “Bad men need nothing more to compass their ends, than that good men should look on and do nothing.” People make calculations on the risks of speaking out and too often decide to remain silent, allowing bad men to compass their ends. This attitude of cynicism and self interest permeates views about those who accept risks. One Chinese youth was quoted as saying people don’t do things for ideals. The world is a sad and lonely place when people do not hold ideals and the people that do are considered lunatics.
I do not believe it is my place to advise Singaporeans who to vote for or what specific policies you should implement. However, I strongly believe you should demand transparency, openness, and accountability from any government of your choosing. I strongly believe you have the right to criticize your government or any other government without fear of retribution. I strongly believe Singapore and Asia need more men and women like Roy Ngerng who are willing to accept the risks of speaking truth regardless of consequence.
Too often we think of doing the right thing as earning reward and benefits when frequently the reality is the complete opposite. Doing right may earn scorn, derision, and retribution. During my five years in Asia, I have met many wonderful people and found them insightful and thoughtful. I have however found too many people unwilling to stand up for what they believe is right. Consumers and citizens are more informed now than ever before and instead leadership creates fear and infantilizes them insisting “you wouldn’t understand.”
Roy Ngerng has met his fundraising objective of paying for the fine, but go further by attending the Return our CPF meeting at Hong Lim park on June 7th. Maybe I will come as just an innocent bystander to observe the proceedings. There is nothing about CPF, Temasek, GIC, or Singaporean finances that I can say that will make people stand up and make their voice heard. The bigger question is whether the good men and women of Singapore will stand by and do nothing.
Brief Specific Points on the CPF (as I have already written much on the topic):
1. There is no interest rate guarantee. As I have long noted, there is no guarantee because you cannot guarantee yourself. The government guarantees CPF funds and Singaporean tax payers are the funders of the government. The Singaporean tax payer is “guaranteeing” itself. This is the equivalent of buying life insurance from yourself and promising to put the payment in a separate account so that based upon your expected death, there will be the same amount for your children. If there are ever problems with CPF and Singapore government finances, guess who will be footing the bill for this guarantee? Singapore taxpayers will be paying for their own guarantee. If something goes wrong and you have to bail yourself out, that is not a guarantee.
2. If the government via any means is legally mandating citizens provide it revenue: that is a tax. The CPF is a significant form of wealth taxation on Singaporeans. In the MOF response, they state that they keep all funds above the “guaranteed” rate meaning they are imposing an implicit form of taxation. A government simply cannot pass a law requiring citizens that confiscates money and not call it a tax.
3. Please raise your hand if you would rather have the guaranteed CPF rate of 2.5% (a total weighted 3.67% based upon all CPF funds) or the unguaranteed GIC rate of return of 6.5% in USD terms? What about the 16% of Temasek primarily holding historical Singaporean state owned firms? Anyone? Anyone?
4. As I have noted before, as a matter of prudence, I support raising the guaranteed requirement. However, to achieve those ends it would be better to let Singaporeans share the benefits of the GIC and Temasek through any number of various proposals, rather than make it that much harder to meet the minimum standard. Temasek is comprised primarily of historically state owned firms and GIC, by the governments own admission, is comprised of public investment capital. The people of Singapore should share this bounty rather than being forced into indenbtured servitude.
Christopher Balding
* The writer is a professor of business and economics at the HSBC Business School at the Peking University Graduate School. An expert in sovereign wealth funds, he has published in such leading journals as the Review of International Economics, the Journal of Public Economic Theory, and the International Finance Review on such diverse topics as CDS pricing, the WTO, and the economics of adoption and abortion. His work as been cited by a variety of media outlets including the Wall Street Journal and the Financial Times. Prof Balding received his Phd from the University of California, Irvine and worked in private equity prior to entering academia. The article first appeared in his blog, http://www.facebook.com/baldingsworld.