The Singapore Model?

[Roy L]

Hong Kong and Singapore have the least regulated economies.

HK and Singapore prosper because they don't try to give such large welfare subsidy giveaways to landowners, as capitalist countries do. In Singapore, most land and housing are publicly owned. In HK all land is publicly owned. Recovering a large part of the publicly created rent of land for public purposes and benefit is the main reason HK and Singapore are so successful.

 

[Becker]

HK and Singapore prosper because they don't try to give such large welfare subsidy giveaways to landowners, as capitalist countries do. In Singapore, most land and housing are publicly owned. In HK all land is publicly owned. Recovering a large part of the publicly created rent of land for public purposes and benefit is the main reason HK and Singapore are so successful.

I honestly didn't know that.

You mean, land which has no housing? Or farm land? Does the government own land because it's scarce?

 

[Roy L]

You mean, land which has no housing? Or farm land?

All the land. I doubt there is much farming in either place.

Does the government own land because it's scarce?

It owns the land because there is no mechanism by which land could ever rightly have become private property.

 

[Blueskies]

markflowchatter Marc Lehman
@herbgreenberg It's offiicial Rodman Renshaw that KO'd investors in the chinese scams drops cov'g in all the names $HOGS, $SCOK, $AUTC etc

China fraud.

 

[eworthington]

HK and Singapore prosper because they don't try to give such large welfare subsidy giveaways to landowners, as capitalist countries do. In Singapore, most land and housing are publicly owned. In HK all land is publicly owned. Recovering a large part of the publicly created rent of land for public purposes and benefit is the main reason HK and Singapore are so successful.

The lack of a private renting class, I would surmise, also drive private capital into other commercial ventures; i.e., trade, production, etc.. The success of those countries is probably a rather good indicator that Henry George was on to something.

 

[Becker]

All the land. I doubt there is much farming in either place.

It owns the land because there is no mechanism by which land could ever rightly have become private property.

in other words, you can only own houses but not land? What about golf courses?

 

[Becker]

The lack of a private renting class, I would surmise, also drive private capital into other commercial ventures; i.e., trade, production, etc.. The success of those countries is probably a rather good indicator that Henry George was on to something.

so now I'm hearing that Singapore is a "free market" where land is NOT privately owned?

 

[eworthington]

so now I'm hearing that Singapore is a "free market" where land is NOT privately owned?

Becker, I don't think anybody is claiming that Singapore is a free market utopia; most are saying that overall, Singapore has a freer market than many countries. While private property rights are protected; the government largely owns the land, and land is, someone correct me if I am wrong, subdivided among developers who purchases titles/leases from the government; the land is then developed and sold in a fashion that, while adhering to zoning rules, optimizes profit for the developers. Government control in the area of actual land is probably more than what most Americans are accustomed to, but in most international rankings, property rights are well-developed and contracts are typically honored or adjudicated in court.

 

[Becker]

Becker, I don't think anybody is claiming that Singapore is a free market utopia;

Just wait until you hear somebody cite the Heritage Freedom index. Where they rank #2 (US #9)
http://www.heritage.org/index/
Compare that to Legatum Prosperity Index, where they are overall #17 (US is 10)
http://www.prosperity.com/rankings.aspx

most are saying that overall, Singapore has a freer market than many countries.

At price most Americans (certainly nearly all here) are willing not to pay. Chewing gum, death penalty, land ownership, drug prohibition, low birth rate.

While private property rights are protected; the government largely owns the land, and land is, someone correct me if I am wrong, subdivided among developers who purchases titles/leases from the government; the land is then developed and sold in a fashion that, while adhering to zoning rules, optimizes profit for the developers.

You mean to tell me the government can actually zone, develop and optimize?

Government control in the area of actual land is probably more than what most Americans are accustomed to, but in most international rankings, property rights are well-developed and contracts are typically honored or adjudicated in court.

Thanks. Heresy to the ears of ancaps. Let's hear their excuses.

 

[eworthington]

Just wait until you hear somebody cite the Heritage Freedom index. Where they rank #2 (US #9)
http://www.heritage.org/index/
Compare that to Legatum Prosperity Index, where they are overall #17 (US is 10)
http://www.prosperity.com/rankings.aspx




At price most Americans (certainly nearly all here) are willing not to pay. Chewing gum, death penalty, land ownership, drug prohibition, low birth rate.



You mean to tell me the government can actually zone, develop and optimize?



Thanks. Heresy to the ears of ancaps. Let's hear their excuses.

I am not defending the government of Singapore's actions Becker. The loss in personal freedom is not simply worth it. Regarding the land issue, if you misunderstood what I wrote I apology. From what I understand, in Singapore land is sold/leased to developers, and they, the developers, build and lease/see on the land they purchased. It is a very close, uncomfortably close in my opinion, government-business partnership.

One thing about the Legatum index is that I did not see how it takes actual property rights into consideration. Heritage's list at least does. Singapore isn't a perfect place, but if you don't really care about their social rules, and you just want a peaceful place to do business, it seems to be a pretty good country.

 

[fisharmor]

All the land. I doubt there is much farming in either place.

It owns the land because there is no mechanism by which land could ever rightly have become private property.

We ought to remember that in most US jurisdictions we don't own land either.
The moment we stop ponying up the yearly rent to the county, they kick us out and find a new renter.

 

[Becker]

I am not defending the government of Singapore's actions Becker. The loss in personal freedom is not simply worth it.

Ok. I'm sure many Americans currently in debt and foreclosure would say otherwise.

Regarding the land issue, if you misunderstood what I wrote I apology. From what I understand, in Singapore land is sold/leased to developers, and they, the developers, build and lease/see on the land they purchased. It is a very close, uncomfortably close in my opinion, government-business partnership.

I didn't misunderstand you, sounds good to me. Where's that Rothcap voice going "yeah but the market is more efficient!"

One thing about the Legatum index is that I did not see how it takes actual property rights into consideration. Heritage's list at least does.

Does Heritage tell you how they measure freedom? Do they consider income taxes?

Singapore isn't a perfect place, but if you don't really care about their social rules, and you just want a peaceful place to do business, it seems to be a pretty good country.

my point exactly.

 

[Imaginos]

Very good point Seraphim.
I believe Peter Schiff and Jim Rogers are absolutely correct about China.
There will be hard landing for China.
But they will handle it, unlike America.
Peter Schiff's main point is, although China has its share of bubbles but fundamentally, it is production based economy.
America is borrowing and spending based economy.
When a country actually work and produce, they can get over setbacks.
But when a country just borrow and spend by exporting its currency, they CANNOT get over setbacks.
That is the key point of Peter Schiff.
We should listen to Peter Schiff and Jim Rogers and start to get back to work instead of just exporting fiat currency and spending like there's no tomorrow.

I was not making a THIS TIME IS DIFFERENT comment.

I was making a CHINA IS DIFFERENT THaN THE USA comment.

Once the USA's debt is factored in, real income levels are much lower then their nominal values.

On the other hand, China's massive savings rates makes their lower income levels less relevant when it comes to absorbing systemic shocks.

1.5 Billion people. 1.5 billion people.

China IS different - avoiding that truth gets you nowhere.

Look, I have ZERO invested in China...Long or Short.

I could care less...I'm just giving my point of view.

 

[Blueskies]

Very good point Seraphim.
I believe Peter Schiff and Jim Rogers are absolutely correct about China.
There will be hard landing for China.
But they will handle it, unlike America.
Peter Schiff's main point is, although China has its share of bubbles but fundamentally, it is production based economy.
America is borrowing and spending based economy.
When a country actually work and produce, they can get over setbacks.
But when a country just borrow and spend by exporting its currency, they CANNOT get over setbacks.
That is the key point of Peter Schiff.
We should listen to Peter Schiff and Jim Rogers and start to get back to work instead of just exporting fiat currency and spending like there's no tomorrow.

I used to believe this. However, Schiff's logic is based on a number of assumptions which aren't necessarily true at all.

First, let's say you have 1k factories that can produce widget A, and I have no factories at all. If the market is demanding widget As, well then clearly you have an advantage.

However, lets say the demand for widget As drops to 0 and the market now demands widget Bs. Also, lets say the cost of converting a factory from producing widget As to producing widget Bs is more expensive than building a factory to produce widget Bs. Who has the advantage now? We're on equal footing.

China has a bunch of factories orientated around producing cheap goods Americans want. When the demand for this dries up, there is no guarantee that these factories can be easily switched over to producing other kinds of goods. Schiff makes a huge assumption by saying that they can, but the truth is, when Americans run out of the money to buy cheap plastic toys and clothes at Walmart--China's entire manufacturing base may be hopelessly obsolete.

Further, production is every year becoming more and more mechanized and less labor intensive. In five years it may be cheaper to build a factory that can produce goods almost exclusively with robots than it will be to use China's factories. Again, in this instance the Chinese have no advantage.

One other assumption Schiff makes is that the Chinese can just switch over to making goods their people want and start consuming them. I've already dealt with the idea that they can just "switch over" easily, so let's touch on the other assumption.

Its like theres some bias against the service sector economy. By definition, half the economy should be service and half should be production. Service is an entire 50%. You can't just pull that out of nowhere overnight. You need a system of transporting the goods, you need a system of warehouses, of selling, of getting consumers financing to purchase and on and on. Schiff assumes that its easier to create a service sector part of the economy than it is to create a producing sector. This is a huge assumption and may not be true at all.

 

[Becker]

I used to believe this. However, Schiff's logic is based on a number of assumptions which aren't necessarily true at all.

be careful saying this kind of stuff here.

 

[silverhandorder]

I used to believe this. However, Schiff's logic is based on a number of assumptions which aren't necessarily true at all.

First, let's say you have 1k factories that can produce widget A, and I have no factories at all. If the market is demanding widget As, well then clearly you have an advantage.

However, lets say the demand for widget As drops to 0 and the market now demands widget Bs. Also, lets say the cost of converting a factory from producing widget As to producing widget Bs is more expensive than building a factory to produce widget Bs. Who has the advantage now? We're on equal footing.

China has a bunch of factories orientated around producing cheap goods Americans want. When the demand for this dries up, there is no guarantee that these factories can be easily switched over to producing other kinds of goods. Schiff makes a huge assumption by saying that they can, but the truth is, when Americans run out of the money to buy cheap plastic toys and clothes at Walmart--China's entire manufacturing base may be hopelessly obsolete.

How do you imagine that it costs more to retool a factory than building a new one?

Besides we have an example with Japan which shows that it is relatively easy to retool. They were in place of China recently. Once they got wealthy enough they started to produce high quality products.

Further, production is every year becoming more and more mechanized and less labor intensive. In five years it may be cheaper to build a factory that can produce goods almost exclusively with robots than it will be to use China's factories. Again, in this instance the Chinese have no advantage.

This been happening since men started to use tools. With every new technological innovation more and more jobs are made. Agriculture used to employ 80% of people, now it is 2%.

One other assumption Schiff makes is that the Chinese can just switch over to making goods their people want and start consuming them. I've already dealt with the idea that they can just "switch over" easily, so let's touch on the other assumption.

Its like theres some bias against the service sector economy. By definition, half the economy should be service and half should be production. Service is an entire 50%. You can't just pull that out of nowhere overnight. You need a system of transporting the goods, you need a system of warehouses, of selling, of getting consumers financing to purchase and on and on. Schiff assumes that its easier to create a service sector part of the economy than it is to create a producing sector. This is a huge assumption and may not be true at all.

Service sector relies on industrial sector. It is costs less to build your own service sector then to employ service sector from somewhere else. So once Chinese are rich enough they will need something else from us then just our services.

It is easier to create service sector because service sector needs to live in the country. The Chinese can't exactly ship in a doctor every time someone gets sick or fly to an American mall when they need to shop.

 

[amy31416]

I used to believe this. However, Schiff's logic is based on a number of assumptions which aren't necessarily true at all.

First, let's say you have 1k factories that can produce widget A, and I have no factories at all. If the market is demanding widget As, well then clearly you have an advantage.

However, lets say the demand for widget As drops to 0 and the market now demands widget Bs. Also, lets say the cost of converting a factory from producing widget As to producing widget Bs is more expensive than building a factory to produce widget Bs. Who has the advantage now? We're on equal footing.

China has a bunch of factories orientated around producing cheap goods Americans want. When the demand for this dries up, there is no guarantee that these factories can be easily switched over to producing other kinds of goods. Schiff makes a huge assumption by saying that they can, but the truth is, when Americans run out of the money to buy cheap plastic toys and clothes at Walmart--China's entire manufacturing base may be hopelessly obsolete.

Further, production is every year becoming more and more mechanized and less labor intensive. In five years it may be cheaper to build a factory that can produce goods almost exclusively with robots than it will be to use China's factories. Again, in this instance the Chinese have no advantage.

One other assumption Schiff makes is that the Chinese can just switch over to making goods their people want and start consuming them. I've already dealt with the idea that they can just "switch over" easily, so let's touch on the other assumption.

Its like theres some bias against the service sector economy. By definition, half the economy should be service and half should be production. Service is an entire 50%. You can't just pull that out of nowhere overnight. You need a system of transporting the goods, you need a system of warehouses, of selling, of getting consumers financing to purchase and on and on. Schiff assumes that its easier to create a service sector part of the economy than it is to create a producing sector. This is a huge assumption and may not be true at all.

Here's the thing--it would be incredibly difficult to switch an industry from widget A to widget B here in America. Why? Regulations.

OSHA, FDA, EPA, minimum wage, child labor laws, etc.

Would that be difficult in China? I doubt it.

The advantage they have is that they can say, at any time, "screw all of this, we're taking over this plant and making it produce whatever we want." There are no "true" regulations. They do not have a worker base, unionized or not, who can say squat about it.

I think Schiff is right in not assuming that the Chinese "leadership" (dictatorship?) is not stupid. US manufacturing switched from consumer goods to war goods in no time flat, so could the Chinese. We ain't special in that regard. And given that China has a massive population advantage and a lot of desperate, hungry people who would love to ingratiate themselves to the powers that be, while we don't, they could certainly make things happen.

Never underestimate people.

 

[Blueskies]

The advantage they have is that they can say, at any time, "screw all of this, we're taking over this plant and making it produce whatever we want." There are no "true" regulations. They do not have a worker base, unionized or not, who can say squat about it....I think Schiff is right in not assuming that the Chinese "leadership" (dictatorship?) is not stupid.

Hi. I'm the economic calculation problem. What's up?

A group of 12 men decides what direction their economy should go in, and then they go that way. So far its been working.

But a basic reading of Mises tell us that this always ends in failure. I do not know why I have to defend Mises 101 to you people.

Also, some other problems the Chinese have that people don't talk about:

1) Their education system is terrible. Its copy-paste, doesn't encourage any creativity, and there are reports that Chinese educated PhDs are less trained than our basic bachelor's holders.

2) Their demographics--what people like to consistently tout--are actually working against them. Because of their one child only policy, their population is rapidly aging and will be old before their economy reaches its full potential. Japan, Europe, and now the US have consistently demonstrated that an aging population leads to a stagnate economy.

3) Going off of 2, they are mutating their populace into one that has many more men than women. As a former bar manager, I can tell you that this a recipe for disaster. I expect widespread civil unrest because of it.

Honestly, in the long run, India is in a much better spot to challenge the US for economic superiority, and they are not close to being ready. US economic hegemony is here for two or three more decades at the least. The US economy might collapse, but the Chinese will not be in a position to fill that void.

 

[Roy L]

in other words, you can only own houses but not land?

Right.

What about golf courses?

The land is leased, the improvements are owned.

 

[Roy L]

so now I'm hearing that Singapore is a "free market" where land is NOT privately owned?

Some land in Singapore is privately owned. In HK none is. There can never be a free market where land is privately owned, as landowning inherently requires a welfare subsidy giveaway to the landowner, and subsidies are not compatible with free markets.