Why On|Offline’s discussion of xenophobia is pointless

P-K4 Project Editorial

How Singapore’s economy will pan out depends on the PAP ministers’ resolve to overhaul their current economic plan

To us medical ignoramuses at NAR, the field of pathology offers us a fascinating insight into how certain diseases affect our bodies and make us really sick. Broadly speaking, according to our friendly doctor, there is a causative agent, which can be a virus, bacteria or a cancerous cell which enter our bodies or arise from cells that have mutated (and become cancerous). In line with how Nature designs our body, the moment this disease-causing agent is encountered, a response is mounted against it, and it is this response that could make us sick. For example, if bacteria enter our bloodstream, our immune system reacts against it, but it can trigger a fever, which make us feel unwell.

Online|Offline is an initiative by bloggers to organise offline discussions on issues that matter to us Singaporeans. They debuted with a discussion on xenophobia, a term which elicits varied interpretations from different people, depending on who you speak to. The session featured Andrew Loh and Ravi Philemon who were joined by Zaqy Mohamad, a Member of Parliament (MP) from the People’s Action Party (PAP), Martyn See, who blogs at Singapore Rebel and Alex Au, who blogs at Yawning Bread. The session kicked off with an attempt at defining what is xenophobia, which unsurprisingly drew varied responses. And they were unable to reach a consensus on whether to take a collective stand against xenophobic behaviour online.

Which raises the question of whether this Online|Offline dialogue is a meaningful exercise at all? We perceive it as a pointless exercise, mainly attributed to how we perceive the source of the problem, and how the citizenry responds, and give rise to symptoms such as xenophobia, which isn’t the only one, as we will explain later, which will further convince you that this talk on xenophobia is really a meaningless exercise.

The best analogy that we can think of to describe the problem is to compare the country Singapore to a human body. The agent responsible for the pathology, or something that causes a disease, can be analogous to a bad policy, which in this case, we argue, are bad economic policies. The consequences of bad policies affect people, and how they respond to such, which results in a disease and its symptoms, and one of them is xenophobia. It is therefore conceivable that policy makers can play doctors to their countries, and mend it on the road to the recovery, or make the country worse off, as do some quack doctors or those who do not practise profession properly.

Economic policies – the causative agent

Before we dwell into a discussion regarding the economic policies that resulted in local problems, we would like to kick-start with an introduction to two very important economic models – exogenous growth model and endogenous growth model. Thus, what is endogenous growth model all about? It is a long run growth as a result of economic activity (within the economy) that creates new technological knowledge. To the endogenous growth theorist, rate of technological progress within an economic entity influences the long run state of economic growth. Technological progress manifests through new products, processes and markets, for instance through process innovation, firms acquire more production experience.

The second model, the exogenous growth model, also known as the Solow-Swan model attempts to explain economic growth attributable to factors outside the economy, as opposed to the endogenous growth model as discussed previously. A typical feature of the exogenous growth model is that frontier technologies are produced in advanced economies, and are then copied and adopted by “follower” countries, hence, this technology is exogenous to such countries. Such technologies can be harnessed to augment labour or capital, which is used in the production of goods and services. However, there are factors intrinsic to the countries that influence their ability to adopt and harness such technologies, for instance, the skills and knowledge of their workforce, which is an important theme of our argument that we will be alluding to time and time again.

What exactly is wrong with Singapore’s economic plan under the current PAP government? Paul Krugman has said it before, and we will elaborate further on it. Our economic planners had a choice between two roads – the high road and low road. The high road is about nurturing technological capabilities and facilitating innovation that leads to more efficient processes of production, new markets, etc. It is also about upgrading the skills of our labour force that they will be able to harness new technologies developed within Singapore or from more advanced economies (as what would happen in exogenous growth). Tan Jee Say’s economic plan which promotes the establishment of a creative industry is an instance of what an endogenous growth theorist would advocate, innovation, creation of new technologies and markets.

The low road is opening the flood gates to cheap foreign labour. These foreigners hail from developing countries. There are two ways to improve output of production, to harness improvement in technology which results in a more efficient production process or increase labour input, especially cheap foreign labour – the more head-counts you have in your labour force, the more output you can produce. Thus, what is the end result of this low road that the PAP government has taken? Simply put, improvements in productivity which can be served by technological progress or a work force skilled and knowledgeable in harnessing new technologies are placed on the sacrificial altar, in favour of a quickfire way to improve production output by opening the flood gates to cheap foreign labour.

There are two facets to this problem. First is the fact that Singapore has opened its floodgates to foreigners from developing countries, whose level of technological achievements lack behind even Singapore herself. Second is the replacement of Singapore’s local workforce who is trained in Singapore or in countries whose technological attainments are superior to Singapore by cheaper foreign counterparts from nations whose technological attainments are below Singapore.

We evaluated technological attainments in various countries reflected through one surrogate measure, attainments in technology and engineering by institutions of higher learning within those countries, i.e. universities. The Shanghai Jiaotong World universities ranking was selected as our data source as its ranking methodology focuses on attainments in research within various fields such as sciences, engineering, biomedicine, etc, which fits our criterion of a ranking system which reflects performance and attainments in selected fields. In analysing the rankings, we focused especially on the achievements of universities from the Asia-Pacific region. It will at least give us an idea about technological progress and advancements made in countries through their universities within the region.

2010 Rankings for Engineering/Computer Science/Technology – top 100 institutions in the world
23. National University of Singapore – Singapore
25. Tohoku University – Japan
31. Kyoto University – Japan
34. National Taiwan University – Taiwan
37. Tokyo Institute of Technology – Japan
39. The Hong Kong University of Science and Technology – Hong Kong
39. The National Cheng Kung University – Taiwan
43. City University of Hong Kong – Hong Kong
45. Tsinghua University – China
47. National Chiao Tung University – Taiwan
50. Korea Advanced Institute of Science and Technology – South Korea
52 – 75. Osaka University – Japan, Seoul National University – South Korea, Shanghai Jiaotong University – China, The Chinese University of Hong Kong – Hong Kong, The Hong Kong Polytechnic University – Hong Kong, University of Melbourne – Australia, University of New South Wales – Australia, University of Sydney – Australia, Zhejiang University – China
76 – 100. India Institute of Science – India, India Institute of Technology Kharagpur – India, Nanyang Technological University – Singapore, National Tsing Hua University – Taiwan, Pohang University of Science and Technology – South Korea, University of Tokyo – Japan

2011 Rankings for Engineering/Computer Science/Technology – top 100 institutions in the world
24. Tohoku University – Japan
29. National Taiwan University – Taiwan
35. Kyoto University – Japan
36. The Hong Kong University of Science and Technology – Hong Kong
39. Tokyo Institute of Technology – Japan
42. City University of Hong Kong – Hong Kong
44. National Cheng Kung University – Taiwan
45. Tsing Hua University – China
46. National Chiao Tung University – Taiwan
48. Korean Advanced Institute of Science and Technology – South Korea
52 – 75. Fudan University- China, National University of Singapore – Singapore, Nanyang Technological University – Singapore, Osaka University – Japan, Seoul National University – South Korea, Shanghai Jiao Tong University – China, The Hong Kong Polytechnic University – Hong Kong, The University of Queensland – Australia, University of Melbourne – Australia, University of New South Wales – Australia, University of Science and Technology of China – China, Zhejiang University – China
76 – 100. Harbin Institute of Technology – China, India Institute of Science – India, Monash University – Australia, The Chinese University of Hong Kong – Hong Kong, University of Tokyo – Japan, University of Sydney

As the rankings demonstrate, our two main local universities, National University of Singapore (NUS) and Nanyang Technological University (NTU) held their own against the rest of the other institutions in the world. NUS was the top Asia-Pacific university in the engineering/computer science/technology category for 2010, and NTU was also in the top 100 for the same category. Both local universities maintained their top 100 positions in the world in 2011.

There are also the usual suspects, Hong Kong, Japan, South Korea and Taiwan, whose institutions also fared well in the rankings, and consistent with their status as the more technologically advanced Asian countries. China is also gaining momentum in terms of technological advancements, as demonstrated by the performance of some of its institutions.

Now, assume a trickling down of knowledge of attainments in various departments of NUS and NTU, we could infer that our local graduates would have attained a comparable level of knowledge and skills to their counterparts from other advanced economies in the world. It is also significant that there are no other institutions from the Southeast Asia region which made it to the top 100, which makes NUS and NTU the best performing institutions from the region.

Although, we used institutional performance as a surrogate measure, the main problem is that we cannot assume every institution in the country will produce graduates with the same calibre as its leading institutions, i.e. not all universities in China is similar in calibre to Tsing Hua and Fudan. For Singapore, NUS and NTU are the two main universities producing graduates.

Now, the problem comes about with PAP’s open door policy, which allows foreign nationals (from Southeast Asia and elsewhere) whose knowledge and skill attainment (because their countries are less technologically advanced) are lesser than Singaporeans through our immigration gates, that means we do not screen these foreigners for their qualifications, e.g. those with a degree from a run-of-the-mill institution in China as compared to say an engineering degree from Tsing Hua. This has a detrimental impact on Singapore. Firstly, Singaporeans are displaced from their jobs by cheaper workers, even though, if we assume a local graduate, he would have been more competent knowledge and skills-wise.

With the displacement of the Singapore workforce by workers from less technologically advanced developing nations, we are looking at the “regressive” form of the Solow-Swan model – an exogenous input of labour of lesser skill and knowledge (we made up this part, there is no such Solow model, it is just to highlight the impact of an input of a labour force that is lesser skilled), which means it is less likely we will achieve the level of technological progress and process innovation to create new markets or products, and produce efficiently. Hence, Singapore will not make inroads in terms of productivity.

There is another significant problem caused by this open door policy. Apologists of the PAP government policies may mount the defence that Singapore has a low unemployment rate. The best rebuttal to this is that the devil lies in the details. Full employment does not mean job mismatch, i.e. the profession that we are trained in and the job we end up doing. An engineering graduate who ends up working as a security guard or frying “gao luck” is an example of a job mismatch. Yet, we read about a senior PAP minister who praised a local graduate who fried “gao luck” (chestnut) for a living, which is a crying shame. And more often, this is the case – Singaporeans who are displaced from their jobs by foreigners end up doing jobs they have not originally trained for. The ultimate losers are the graduate obviously, and the tax payers, who subsidise his education, but as a result of such mismatch, the opportunity costs can be substantial.

Even more damning is that our local universities are able to churn out graduates with the requisite skills and knowledge, and will be integral in the drive towards greater productivity should we choose the high road, but no, this potential remains disappointingly ignored. For all the talk of Singaporeans being precious human resources, it seems the PAP government chose the low road which led to the inability to utilise such resources.

Xenophobia, only one symptom, out of many which are more major

Why the talk of xenophobia is really just a mere sidetrack to the problem of PAP’s open door policy?

We will like reiterate, the problem can be perceived as a body falling sick due to a pathology, which in this case, is bad economic policies. This pathology can elicit a response from the body, which can result in some major symptoms, some more so than others. Let’s have a look at some of them.

• Job mismatch. Opportunity cost of education and lost opportunities. Lower job satisfaction and remuneration
• Sacrificing gains in productivity due to replacement of local work force with a foreign workforce that is less skilled and knowledgeable. See earlier arguments
• Depressing of wages, and inability to cope with the standards of living
• Transmission of diseases, due to crowding. There is an increase in number of TB cases because of foreigners bringing in whatever illnesses they have caught in their homeland
• A Singapore that is divided politically. As Tan Cheng Bock observed of the General Elections 2011, he finds that there is a political divide in Singapore, and was the motivation for his Presidency.
• Crime and vice activities. Some locals figure a way to make money out of this open door policy and con the poor foreigner into prostitution, and other things. It also happened the other way round, foreigners conning locals. Also, no prizes for guessing why Joo Chiat became a mini-Geylang – the open door policy.
• The housing problem, is there enough housing supply to house Singaporeans and foreigners?
• Crowded transport, can you even catch a bus or train during the peak hour?

Yes, xenophobia is one of the symptoms, but deserving of a 2 hour discussion? Hmm.

Profits to be made from the education market

The Singapore government has been eyeing the education market for some time, including inviting universities like the University of New South Wales, Australia, to set up a campus down here. It wants Singapore to be an education hub, as a destination for students from other parts of Asia to pursue their studies. Foreign students account for a proportion of the influx.

However, the government has much to learn from its Australian counterpart. Australia has a list of vocations that it is in demand, and will happily welcome migrants with such skills.

Australia has institutions known as Technical And Further Education (TAFE) institutions, which are no different from Singapore’s Institute of Technical Education and polytechnics. For internationals who want to migrate to Australia, going to a TAFE institution is one of the ways to get a visa and settle down eventually. TAFE institutes provide training in certain vocations, and ensure that its graduates are familiar with the Australian standards of performing within certain vocations. For example, a cookery student has to master the required level of hygiene standards within the kitchen. The Australian government also plays an active role in marketing its TAFE institutions.

Australia benefits in two ways. It gets migrants with the skills in demand, and the latter also stimulates the economy as a full fee paying student.

Thus, if Singapore is facing a dearth of skills in certain vocations, it can advertise its ITEs and polytechnics to foreign countries. Let the full fee paying international students come and we benefit both ways too.

For the PAP, it is about political survival from now

PAP’s results during General Elections 2011 told it all. 60.1% of the votes, which is already a critical percentage. Go below that, we will see the fall of more GRCs, and a near even distribution between PAP voters and non-PAP voters.

The results also told another story, the loss of George Yeo, which shattered the myth of the invincibility of a minister. Yet, during General Elections 2006, there was some talk of challenging Low Thia Khiang and Chiam See Tong to form a fantasy dream team and contest against Lee Hsien Loong at Ang Mo Kio. Now, after Yeo’s loss, even Lee looked beatable. A suicide squad from Workers’ Party managed 33.86% against Lee in 2006. In 2011, a crisis-plagued Reform Party managed 30.67% of the votes.

There are reasons for Lee to worry. 2011 saw the emergence of “A” category candidates – Chen Show Mao, Ang Yong Guan, Michelle Lee, Benjamin Pwee and Jimmy Lee. There is no doubt more will emerge for the next elections. Lee is lucky to face a suicide squad and a crisis-plagued party, which are hardly a test of his mandate. An “A” team will do far more damage for sure, possibly sacking him from Parliament.

For the PAP campaigns during the elections, it will be useful to talk of what they do not have, and what is absent is a real economic plan. While Tan Jee Say presented his economic plan, the PAP itself did not speak of any of its own.

Now, the PAP has to go back to the drawing board, maybe even discard its old templates in favour of newer economic plans that benefit Singaporeans. The PAP has to realise by now that if they do not organise an overhaul of their economic plan, there is a last card, and it is going to be a ‘bloody’ scenario for the party. Many readers think that Lim Chong Yah’s prescription on freezing wages for top earners and increasing incomes for the poorest is shock therapy, the one that is reminiscent of the electric shock therapy that they do for depressed patients to reboot their mental circuits according to our good doctor. The shock therapy we are talking about is the sacking of the entire PAP ministerial cabinet during an election, where the PAP now becomes an opposition party. This makes Lim’s prescription look like a mere pin prick. This one is Singapore’s economy rebooting.

Thus, now, it is either the PAP reboots, or the voters do the rebooting. The latter scenario may be “bloody” for the PAP as it will be facing inquests for policy failures and others. As Lee is the current steward of our economy, it is up to him to ring out the changes. Failure to do so, and if up against an “A” team during subsequent elections, he may need all the chillies and onions in this world not to ward off the rain, but to get into parliament.

Where the money is

They always say, whatever you do, go where the money is.

A discussion about defining xenophobia, and subsequent inability to reach a consensus to take a collective stand against xenophobia shows how pointless such an exercise is.

It is like approaching a patient with a cancerous mass on his jaw, and getting overly concerned about the cosmetic impact, fretting over whether he looked handsome or ugly. Yes, xenophobia is not handsome, we know that. An appropriate approach will be to focus on the cause, that piece of cancer that will probably kill the patient. The thrust of our concern is whether such poor economic policies will “kill” our country in the long run.

The Online|Offline talk probably achieved nothing much than giving more air time to the bloggers involved. This is a subjective statement, but most of us in the team have not ever seen most of them in action other than their photos.

The moral of the story is what the good doctor told us, the pathology is where the money is.

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Photo courtesy of Sheep “R” Us, Flickr Commons