Why are Singaporeans not discontented despite a big wealth disparity? Communitarian democracy as a social glue in face of wealth inequality

Posted on December 7, 2017

0


by Jerrick Wee

“For indeed any city, however small, is in fact divided into two, one the city of the poor, the other of the rich.” Such is Plato’s observation in the Republic two thousand years ago on the divisive effect that wealth inequality has on the social cohesion of citizens in a city. Curiously, Singapore, while having a significant wealth disparity, appears exempt from this divide. Having one of the highest adjusted-Gini coefficient among developed countries, Singaporeans do not seem to consider wealth disparity as a pressing issue in the country, and instead are more concerned with other public issues, such as the increasing cost of living and the inefficiencies of certain public services. The central question guiding this essay is this: why is wealth inequality not a major source of discontentment in Singapore despite the empirically clear wealth disparity? I argue that the state ideology of communitarian democracy characterised by Chua Beng Huat allows the Singaporean government to prevent the dissent that arise from wealth disparity by two mechanisms of communitarian democracy—the communitarian aspect and the democratic aspect—that effectively nullifies the social divide of wealth inequality amongst Singaporeans.

A popular way to measure wealth inequality in a country is through the use of the Gini coefficient, a metric that measures the dispersion of wealth among citizens. A figure of 0 means perfect equality while a figure of 1 is perfect inequality. As of 2016, Singapore has a Gini coefficient of 0.458 and the adjusted Gini coefficient after accounting for government transfers and taxes is at 0.402 (SingStats, 2017), one of the highest figures in the developed world. Almost all developed countries in the Western world have a Gini coefficient of above 0.4 (OECD, 2017), but the key difference between Singapore and these countries is that the developed countries in the Western world have income redistribution or welfare policies that reduce the adjusted-Gini coefficient substantially. For example, Germany has a Gini coefficient of 0.504 and an adjusted figure of 0.295 after taxes and transfers (OECD, 2017). The real inequality for these countries are in effect low, and hence not a source of discontentment among the citizens. On the other hand, a city like Hong Kong with the highest adjusted-Gini coefficient among developed nations of 0.537 (OECD, 2017) nations faces social stresses and political instability from the wealth disparity. Singapore’s ability to maintain its social and political stability despite having similar wealth disparity levels as Hong Kong is hence an interesting case to study.

I argue that Chua’s characterisation of the Singaporean state ideology of communitarian democracy provides a convincing explanation of the phenomenon. The state ideology of communitarian democracy characterised by Chua allows the government prevent the dissent that arise from wealth disparity by two mechanisms: first, the communitarian aspect of communitarian democracy allows the government to distribute equitably key material goods for basic living with a slight illiberal touch; and second, the democratic aspect of the communitarian democracy provides a strong feedback mechanism for the government to respond to unhappiness within the state. These two mechanisms effectively nullify the divide of wealth inequality of Singaporeans.

Let us begin with the first mechanism of communitarian democracy. Chua (1991), in his article “Towards a non-liberal communitarian democracy”, identifies a few salient features of Singapore’s democracy. The most notable trait for Singapore’s democracy is the “absence of western liberalism”: the set of principles which centres around the individual and sees the constitutional protection of individual’s rights. Singapore, while a democracy and has an open economy, is de facto non-liberal—the protection of civil liberty is not the government’s main purpose. Instead, Chua (1991) describes that for the government, “the centrality of the ‘collective’ well-being and ‘communitarianism’” is placed “against the centrality of the individual and individualism”—that is, the community is placed above the individual. The centrality of the collective well-being has various corollaries in the state, notably the way the law is employed by the government. While the rule of law is a crucial tenet in liberal democracies—in which the law prevents the state from arbitrarily exercising power over its citizens—the law has a slightly different use in Singapore. The legal system in Singapore is an instrument for the government to exercise control over social behaviours, in what Chua calls, in his article “Liberalism Disavowed” (2017), a “rule of/by law”—the Singapore government uses the law to rule, instead of ruling within the law.

The non-liberal communitarian feature of Singapore’s politics manifests itself most crucially in land management in the country. One of the most important law to have ever passed is the 1966 Land Acquisition Act, which provides the state the legal authority to acquire private land for public purposes. In other words, the state could, provided that the state determines a certain landholding is vital to national interest, acquire any private property in Singapore. Such a use of the law is clearly antithetical to liberal values regarding private property rights, which is only possible in a state where liberalism is not the main political value. The Land Acquisition Act afforded an equitable distribution of the most necessary and scarce resources in the country—land—for the citizens of the country. Through the Housing Development Board (HDB), the public housing program allowed more than 85 percent of the population to own a home by the 1990s. More than just providing homes to citizens, the ability to acquire more than 90 of the state’s land allows the government an effective urban planning, further providing high quality public goods like the Mass Rapid Transit (MRT) system. The universal provision of public housing has the side effect of turning citizens to become politically conservative as they try to protect the values of their houses.

Psychologically, the public housing program eliminated the most painful consequence of wealth disparity: the drastic, visible difference in standard of living between the rich and the poor. Since between the first to the eighty-fifth percentile of the population live in a somewhat homogenous standard of living, wealth disparity is kept private, to within the flat, and does not show ostentatiously. The estates in Singapore are uniform in that they all carry the same service provision required by the government: a playground in each precinct, shopping malls for each neighbourhood, a town centre, a MRT station, fast-food centres, schools, government-built polyclinics, sports facilities, and other religious buildings (Chua, 2017). In Chua’s own observation, “all towns and their residents are equally served without discrimination” (2017). Singaporean estates have no analogy to 90120[1] in Beverly Hills of California, or Forbes Park’s rich-slum divide in Makati City of Manila, where the rich conspicuously show off their wealth. The rich in Singapore are tucked away in the 10% of the private housing estates in the country, most of them in hard-to-access areas in Bukit Timah and off the island of Sentosa. The effective urban planning for housing and public goods creates a common Singaporean experience that is shared among 90 percent the population, veiling the economic inequality in the society and preventing potential discontentment of highly disparate levels of wealth (Chua, 2017).

The second most salient feature of Singapore’s democracy is the government’s ability to receive and respond to feedback and grievances effectively through the quinquennial general elections and its openness to consultation on public issues from interest groups (Chua, 1991). While the PAP government has an ambivalence to general elections[2], the general elections historically has always worked in their favour: the PAP has received overwhelming electoral support since they have come to power in 1959, conferring them a strong political legitimacy. More importantly, in addition to various consultation channels from the electorate to the government, the elections are the most effective feedback mechanism for the PAP government: a vote for the opposition is usually not an endorsement for the opposition, but a vote against the PAP.

Take the case of the 2011 General Election for an example. The PAP garnered the lowest number of votes in Singapore history—only 60.14% of the electorate voted for them—and it was the first time the PAP lost a Group-Representative Constituency (GRC) to an opposition party despite having the highly-popular then-Foreign Minister George Yeo to contest in the GRC. Coincidentally, the period since 2008 also saw the highest wealth inequality in Singapore’s history due to the aftermath of the 2008 financial meltdown (SingStats, 2017). The government response to the obvious unhappiness among the electorate was swift: the government instituted policies that directly addressed almost all of the concerns of Singaporeans: for the poorest, the Singapore government created the GST voucher scheme; for the low wage earners, the government provided the Workfare Income Supplement (WIS) scheme[3]; for the richest, the government increased tax on them; for the elderly, the government created a SGD 8 billion healthcare package; and for the ministers, they all took a pay cut. Key to a communitarian democracy, the Singaporean government grew to be more flexible: while the government has been staunchly anti-welfarist in the 20th century, it allowed for welfare policies like the GST voucher scheme, which gives cash somewhat indiscriminately to 880,000 households without requiring any income information from its citizens.

I have so far argued that the two salient features of Singapore’s communitarian democracy—the non-liberal emphasis on the community’s well-being and a strong feedback mechanism from elections and consultation—diminishes the discontent of wealth inequality in Singapore. Two objections can be raised for each feature. First, are there not many other factors that come into play that reduces the people’s potential to be discontented at their lives besides the universal provision of housing? And second, while the government does swiftly enact policies to address grievances, the wealth disparity in Singapore in 2016 is still one of the highest in the developed world even after accounting for government transfers and taxes—how could people be content with what it seems like policy of limited effectiveness?

It is true that the universal provision of housing and public goods are not the only factors that diminishes discontentment over wealth inequality among the citizens. One can point to the overarching control the government has over its citizens as causes for the lack of discontentment. The strict control of the press allows the government to promote the idea of a growing, increasing wealthier middle class, and also to suppress any demagogic intentions to use wealth disparity as a political topic. Furthermore, the philosophical emphasis on meritocracy as a reward system in Singaporean institutions (most notably in education) also helps people to believe that the wealth inequality is caused by the lack of one’s merit, rather than structural socio-economic causes. These forces might contribute to the overall lack of discontentment, but I think the greatest impact Singaporean’s communitarian democracy has on Singaporeans is the universal provision of high-quality housing, which homogenises the Singaporean way of life. The pains of wealth inequality in Hong Kong is especially acute due to the government’s ineffective public housing policies, caused by a proper commitment to private property rights, and also highlights the physical difference in standard of living between the rich and the poor.

Furthermore, it is also true that the policies post-2011 have little overall impact in reducing the wealth inequality—the adjusted-Gini coefficient is still one of the highest in the developed world. Yet, this is one of the instances where economic metrics do not necessarily reflect the effectiveness of social policies. The schemes that the government instituted post-2011 is aimed to directly reduce the pain of the growing cost of living. The SGD 8 billion pioneer package, for example, is not funded by increased tax from the richest but from the sovereign reserves, and hence has little impact on the Gini coefficient. While the tax rate for the richest did increase, it affects only a small minority of the population at a rate insignificant to affect the Gini coefficient. It is beyond the scope of this essay to determine if the lives of the electorate have improved in the post-2011 measures, but one could see the electorate’s contentment with the PAP government with the results of the 2015 General Election, where the PAP garnered an almost 10% increase in their vote count. While there has been no significant increase in wealth redistribution, the divisive nature of wealth inequality seemed to have been kept a bay with PAP responses to crises with novel policies.

 

 

 

Citations

Chua, B. (2017). Liberalism Disavowed: Communitarianism and State Capitalism in Singapore (Vol. 1). Singapore: NUS Press.

Chua, B. (1995). Communitarian Ideology and Democracy in Singapore. London: Routledge.

Organisation for Economic Co-operation and Development (OECD),. (2017). OECD Income Distribution Database (IDD): Gini, poverty, income, Methods and Concepts. http://www.oecd.org/social/income-distribution-database.htm

Statistics Singapore (SingStats),. (2017). Key Household Income Trends 2016. Singapore: Department of Statistics. https://www.singstat.gov.sg/docs/default-source/default-document-library/publications/publications_and_papers/household_income_and_expenditure/pp-s23.pdf

 

 

[1] “90120” is a popular culture reference to the zipcode of a certain neighbourhood in the city of Beverly Hills which houses the most expensive homes in the county of Los Angeles, California, United States.

[2] The late prime minister Lee Kuan Yew often laments general elections in that the government have to cater to the sometimes whimsical demands of the electorate, but also praised electoral democracy as the only political arrangement which allows for the nonviolent transition of power.

[3] The WIS Scheme is a novel “negative tax” system that provides cash incentives for low-wage worker to work and attending skill-upgrading courses at the same time, supplementing cash for the low-wage worker to keep up with the growing cost of living in Singapore.