The Singapore Model?

[Becker]

Hmm Singapore has large population of Indian immigrants and even adopted their language as an official language...

Indian immigrants are 10% of the population, and the naturalization rules are very strict (I'm surprise they have one at all)
http://en.wikipedia.org/wiki/Singaporean_nationality_law

So I was wrong, it's not that they completely don't allow immigrants, or refuse citizenship applications, but they don't have a problem setting quota or using population density as an argument to reject applications.

 

[specialK]

Hmm Singapore has large population of Indian immigrants and even adopted their language as an official language...

"Large" is all relative. 28 percent Indian in the neighboring city to mine and growing daily. I wonder how well Singapore would function at those immigration levels.

 

[eworthington]

Singapore also has a mandatory savings scheme which, although I doubt most of us would agree with it on principle, it does lead to higher savings rate, and it probably helps the country avoid spending a lot on welfare during an economic downturn (something normal in the West). It is also, more-or-less, a right to work country, and from what I remember reading the cost of hiring and firing employees is very low. It is also open to trade with other countries; something that it has to do for survival due to its size.

Also, with regards to mandatory savings, it is also a strong deterrent for people to stay out of the work force because it would eat away at their own savings. Their health system also, if I am correct, relies largely on Medicare-like system with large co-pays and deductibles.

The so-called Singapore Model is essentially a free market with a large government stick forcing people to behave more responsibly. I'm not sure how it can be used against Austrian Economics since it performs better than our economy because, although it is a mixed economy, it is more in the direction of a free market economy than ours. It is further evidence that freer markets perform better.

If it validates more government intervention anywhere, it is not in the economic realm, but in regards to responding quickly and forcefully to criminal and deviant behavior.

 

[QE Is Theft]

Fuck Singapore.

They hang non-violent drug offenders.

 

[mainstream economist]

Some people think that Singapore is horrible.

I tend to agree. We complain about the Republi-crat de facto one-party system. Singapore actually has an open one-party system in which no one would find out about government corruption and the courts are stacked in favor of the ruling party... There's no evidence of corruption in North Korea either. I seriously doubt that is because there is no corruption.

 

[eworthington]

I wouldn't count myself a fan of Singapore's government either. I don't know if the one-party state is the biggest problem or even day-to-day corruption; they have conscription, and they do seem to use the death penalty for not terribly serious crimes.

That said, the country does seem to prosper in a relatively hostile environment; it has a large Malay minority, and it borders Malaysia -- a much larger country that has had it issues with Singapore. Not to mention the country survived some vicious race riots in a better state than we survived our "Civil Rights" era.

 

[Becker]

Singapore also has a mandatory savings scheme which, although I doubt most of us would agree with it on principle, it does lead to higher savings rate, and it probably helps the country avoid spending a lot on welfare during an economic downturn (something normal in the West). It is also, more-or-less, a right to work country, and from what I remember reading the cost of hiring and firing employees is very low. It is also open to trade with other countries; something that it has to do for survival due to its size.

Also, with regards to mandatory savings, it is also a strong deterrent for people to stay out of the work force because it would eat away at their own savings. Their health system also, if I am correct, relies largely on Medicare-like system with large co-pays and deductibles.

The so-called Singapore Model is essentially a free market with a large government stick forcing people to behave more responsibly. I'm not sure how it can be used against Austrian Economics since it performs better than our economy because, although it is a mixed economy, it is more in the direction of a free market economy than ours. It is further evidence that freer markets perform better.

If it validates more government intervention anywhere, it is not in the economic realm, but in regards to responding quickly and forcefully to criminal and deviant behavior.

very well put.

 

[ibaghdadi]

The so-called Singapore Model is essentially a free market with a large government stick forcing people to behave more responsibly.

This.

 

[alex_florida]

Singapore also has a mandatory savings scheme which, although I doubt most of us would agree with it on principle, it does lead to higher savings rate, and it probably helps the country avoid spending a lot on welfare during an economic downturn (something normal in the West).
Also, with regards to mandatory savings, it is also a strong deterrent for people to stay out of the work force because it would eat away at their own savings. Their health system also, if I am correct, relies largely on Medicare-like system with large co-pays and deductibles.

QUOTE] As far as I know, these mandatory savings are personified accounts but not a Ponzi sceme like Social Security, and funds from these accounts may be used for investment in securities and your real estates, i.e. they are more flexible to use than IRA accounts - nothing similar with SS or Medicare.

 

[Jeez]

"Large" is all relative. 28 percent Indian in the neighboring city to mine and growing daily. I wonder how well Singapore would function at those immigration levels.

You are comparing parts of America with whole of singapote, there areas in Singapore that have Indian and malay majority. Remember all the outcry when schools offered pre spanish classes, Singapore adopted Tamil as an official language.

 

[silverhandorder]

Singapore reminds me more of a monarchy then a democracy. Unfortunately for people that like democracy it also seems like a better system. Singapore's government has long term planing which to me looks like a product of having one party with the president that pretty much always gets reelected. So if someone tells you Singapore proves that government works better then capitalism (it does not but Singapore is not relevant to discussion in that respect) point out that it should also prove that democracy does not work.

 

[Liberty74]

Chinese bubble here

Can someone enlighten us what this Chinese bubble is all about?

It's called Ghost Cities where China built these massive cities where hardly anyone lives.

Check out the amazing pictures!

Bloomberg talks about the housing bubble in China.

 

[Seraphim]

There are two primary reasons why China does not have a housing bubble (correction needed however).

1) MOST houses bought are with 50% ish down payments. It's not a crazy debt driven bubble.

2) They have MASSES of poor and homeless people - the Chinese govt WILL get people in those houses/buildings. It's a matter of time.

It's called Ghost Cities where China built these massive cities where hardly anyone lives.

Check out the amazing pictures!

Bloomberg talks about the housing bubble in China.

 

[Blueskies]

The Chinese are communists. I don't know why people forget this. Just because they let us invest (a minority stake mind you) in their economy doesn't change that fact.

Remember, the communists in the USSR made Russia tremendously more wealthy from 1920-1980. However, they (as all central planners eventually do) ran into the economic calculation problem.

The Chinese, too, are going down because of the economic calculation problem. Their government drives their economy in the direction they feel is best. They thought that making products and exporting to the US was the best way for China's economy to go. So they encouraged manufacturing, saving, and manipulated their currency to focus on exports. Then, after the 08 crisis hit and the US didn't want to buy any more of their stuff (due to lack of funds) they began a tremendous Keynesian stimulus program where they built all kinds of cities and infrastructure projects that are completely uneeded.

It goes back to the age old master builder problem.

The Chinese will fall, they are on the verge. We are the last stand on Earth. Never forget that.

 

[Liberty74]

There are two primary reasons why China does not have a housing bubble (correction needed however).

1) MOST houses bought are with 50% ish down payments. It's not a crazy debt driven bubble.

2) They have MASSES of poor and homeless people - the Chinese govt WILL get people in those houses/buildings. It's a matter of time.

Bubbles don't have to be "debt driven" by consumers. If there was a market for these 38 million homes built by China and if the Chinese people can afford to put 50% down, the homes would be filled by now rather than completely empty. And if homeless people are put into these homes, who's getting paid? How?

 

[Seraphim]

Bubbles don't have to be "debt driven" by consumers. If there was a market for these 38 million homes built by China and if the Chinese people can afford to put 50% down, the homes would be filled by now rather than completely empty. And if homeless people are put into these homes, who's getting paid? How?

Yes, actually they do. All bubbles are driven by credit expanding within the market in question. As future demand rapidly increases in the form of I WANT IT NOW...credit becomes the means by which currently unavaible resources can be purchased.

What I was really getting at is that China is very centrally planned. They know damn well they have scores of people in need of homes. Many poor agrarians are flocking to cities and the massive change in population demographics will continue.

Even if real estate prices fall sharply in China, they produce enough income that any significant price drop in RE will see people swoop in.

These ghost cities will not remain ghost cities.

If this were the USA or a western country I'd be very much inclined to say POP GOES THE BUBBLE.

China is a different beast.

A correction, but not an implosion, is in the cards.

 

[Blueskies]

Even if real estate prices fall sharply in China, they produce enough income that any significant price drop in RE will see people swoop in.

How come this logic has not applied to the US?

These ghost cities will not remain ghost cities.

Some of them have been around for 10 years.

China is a different beast.

"This time its different."

Are you familiar with Jim Chanos? Look up some of his recent interviews. He was the guy who discovered the Enron fraud.

 

[Seraphim]

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.

How come this logic has not applied to the US?



Some of them have been around for 10 years.



"This time its different."

Are you familiar with Jim Chanos? Look up some of his recent interviews. He was the guy who discovered the Enron fraud.

 

[specialK]

You are comparing parts of America with whole of singapote, there areas in Singapore that have Indian and malay majority. Remember all the outcry when schools offered pre spanish classes, Singapore adopted Tamil as an official language.

No, I wasn't referring to America at all, actually. I don't live in the US.

Singapore is a city-state, I am therefore comparing one cosmopolitan city to another. They may as well adopt Punjabi as an official language where I am. The bank machines are in Punjabi, the government driving tests are in Punjabi, they have Punjabi language classes in public schools and many, many more examples.

When you import cultures, you import the good, the bad and the ugly. The bad and the ugly from developing nations can be particularly awful. If Singapore had a much higher rate of Indian immigration, things would not be quite so smooth.

 

[Roy L]

Tell them to wait 12 months. Singapore will go down in flames along with China.

No, it will not.

The market always, always wins.

Where is your evidence that the market is not already winning in Singapore?