Friday, August 29, 2014

The 2014 National Day Rally: An impression of significance

Wed, Aug 20, 2014

Yahoo News


Devadas Krishnadas is the Chief Executive Officer of Future-Moves Group, a strategic risk consultancy. The views expressed below are his own.

According to the mainstream media, the 2014 National Day Rally was a big success and signals significant policy changes ahead. The theatrics of high definition graphics, the Prime Minister playing reporter and financial planner and displaying his singing skills was certainly crowd pleasing to the gathering of party faithful.

Announcements about changes to the policy on the Central Provident Fund (CPF) and a rethink on the relative merits of experience versus education played to the gallery of public opinion. But what was the real significance of the latest rally? What does it tell us about the today as a political age?

Seven pillars of a good retirement savings system

Aug 29, 2014

If it ain't broke, don't fix it. Just improve it. The Central Provident Fund, that is.

By Joseph Cherian For The Straits Times

THERE is a famous American South saying that goes, "If it ain't broke, don't fix it". In the more enlightened North, branding gurus and academics would prescribe a rebranding exercise for ailing entities.

Let me explain why the Central Provident Fund (CPF) system ain't ailing nor broke (no pun intended), and why we should actually be celebrating the fact that some folks from the pioneer generation almost 60 years ago had the foresight and extraordinary prescience to come up with a mandatory, fully-funded, defined contribution social security savings system that is able to provide for our basic retirement expense needs with assurance.

Ain't broke...

A DEFINED contribution (DC) plan - like the CPF, the 401(k) programme in the United States and Australia's Superannuation scheme - is one in which the employee, along with the employer in many cases, make contributions to an employee's individual retirement account on a monthly and tax-advantaged basis.

In a defined benefit (DB) plan, the sponsor promises to provide the retiree with a pension income, which is usually a function of her salary, tenure of service and so on.

The CPF savings scheme, along with CPF Life, an annuity plan with a clear schedule of benefits, is almost a hybrid of the two plans. But that is where the similarities end.

In America, many DB plans are going broke or are grossly underfunded, which means they are making promises to future retirees that they cannot keep.

As a consequence, the trend around the world is for systems to move towards a CPF-like, hybrid DC/DB retirement savings system - that is, with fully-funded individual accounts that cumulate over one's working years, with some (but not a large) amount of investment and withdrawal flexibility, and that converts to a life annuity upon retirement.

The beauty of the CPF system is that it has been practising this for many years, with savings rates of up to 5 per cent per annum. There is also the recent CPF Life annuity scheme, both fully-guaranteed by the Government. There is an employer-matching and tax-advantaged supplementary retirement scheme to boot.

The CPF offers 3.5 per cent interest for the first $20,000 of Ordinary Account savings, and 2.5 per cent for sums above that in the OA. It gives 5 per cent on the first $40,000 of balances in the Special, Medisave and Retirement Accounts (SMRA) and 4 per cent for sums above that in the SMRA.

What's significant is that these are guaranteed rates devoid of risk. This is in effect the Government's "borrowing rate" from CPF's members.

One may rightly ask why any sound government would borrow at 4 to 5 per cent when it could go to the public debt markets and borrow at around 2.9 per cent over 30 years.

In effect, the Government is providing a healthy "subsidy" on our Retirement Accounts. Hence, the call to increase the riskless savings rate any further is not prudent.

One common criticism of the CPF is that the Government stands to enjoy higher returns from the CPF monies, which are pooled and handed over to investment agency GIC to be invested. GIC returns are sometimes higher than what CPF pays.

But we have to realise that it is preferable that a retirement system is not subject to the kind of risk borne by the GIC. The Government, on the other hand, guarantees the CPF savings rates, irrespective of market cycles or global financial crises.

What the Government does with the money it raises by issuing Special Singapore Government Securities is part of its business of running government, as long as it is managing its assets and liabilities prudently. To subject CPF members' savings, which is less than the Minimum Sum, to the (risky) returns of the GIC may not be prudent.

Neither is the call to increase the risk-taking appetite on our CPF savings - at least for savings not in excess of the Minimum Sum, as the volatile recent stock market experience, circa 2008- 2009, informs us.

Lastly, simple financial mathematics tell us that at our current expected mortality and discount rates, the estimated $1,200 payout for CPF Life from the cumulated Minimum Sum of $155,000 is an extremely reasonable payout.

Whether this $1,200 is enough for now, or more importantly in our twilight years where the threat of rising prices is real, is another matter.

Needs fixing

WHILE the overall system is anything but broken, that's not to say some parts of it don't need fixing.

As the Government looks into improving the CPF system, it can learn from the good and bad experience of many other countries, as well as academic studies, so that we do not unnecessarily change a system that works. And rather, make a good system even better.

Here are some important considerations:

  • Back to basics: A good retirement savings programme is focused on basic retirement and medical expenses. Keeping to this objective is key.
  • Resist temptation: The temptation to dig into one's retirement pot excessively for current needs, be it for housing, medical expenses or education, can lead to severe underfunding consequences down the road, which is when you need the money the most.
This phenomenon, which anecdotally seems fairly prevalent in Singapore, may be the reason why a recent HSBC Insurance "Future of Retirement - Singapore Report" Survey indicated that only 57 per cent of survey respondents in Singapore felt that they had enough money to live on in retirement.

That said, most experts agree that withdrawals for severe emergencies and exigencies should be allowed.

In my view, we should not allow CPF retirement savings to be used for housing, medical and education needs. Like in the United States, these should be run as separate programmes with appropriate tax incentives to encourage savings.
For life: Life annuities are a necessary and prudent retirement product for meeting one's basic retirement and medical expenses, or more. Given that it is a life product, the more guaranteed the better - after all, it would be very painful to find out in 20 years' time that one's insurance provider of a life annuity has gone from being "AAA"-rated to a ward of the state overnight.
CPF Life, with payouts guaranteed by the Government, is hence the right basic life annuity product for all. Where it can be improved upon though, is the ability to cover inflation. CPF Life should be inflation-indexed, to take into account rising costs of living over the years.
Several default funds: For accounts that allow for it, giving too much investment choice is not a good thing as it leads to "investor paralysis" (not knowing what to invest in amid too many choices).
What is instead needed is a few well-diversified and low-cost asset allocation funds that members, who wish to seek more risk-adjusted returns, can pick from.

The default asset allocation fund, for those who do not need or want the additional options, should be the most conservative one. The call to introduce private pension plans is in sync with this idea.

These higher-risk investment strategies, however, should be available only to those who have met - or show the potential via their current savings level to meet - say, a Minimum Sum, which in itself should convert to a guaranteed life stream of payouts for basic life needs at retirement, like a CPF Life.

This part of the programme can be managed by the CPF Board, government-linked entities, the private sector, or a combination of all three as a private-public partnership.
Limit lump-sum withdrawals: Lump-sum withdrawals at retirement could be sub-optimal irrespective of your religion, race, nationality and education level.
To a certain extent, financial theory and anecdotal evidence in the United States suggest that the temptation is to spend lump sums, especially if one is cash-strapped, not realising there may be too little left for one's retirement needs until it is too late.

This is the reason why many advanced nations are introducing inflation-indexed life annuities into their retirement programmes.
Monetise flat: A leasehold apartment, which is not expected to stay for generations within a family, is a perfect asset to monetise so as to supplement and enhance our income for life's basic needs, leisure and pleasure in retirement.
To that end, the Housing Board has various home monetisation programmes available for CPF members. Again, such programmes should be kept simple for the layman to understand and participate in, with minimal equations, mathematical inequalities, and with shelter for life assured (preferably in one's own apartment).
Public education: Basic financial and retirement savings education for all is necessary and an imperative, but it is not the panacea for our retirement planning woes. Some fundamental decision-making with respect to our retirement savings has to be handled benevolently at the state level.
In summary, the CPF system is not broke or badly designed, although it may need certain improvements, as the Prime Minister himself has admitted recently.

Indeed, he mentioned he will be charging a committee to look into all this.

With one's housing to rely on, and the additional support of Workfare, Silver Support, and other prudent financial support schemes from the Government, Singapore should be in good shape to weather retirement.

The writer is a practice professor and director of the National University of Singapore Business School's Centre for Asset Management Research and Investments.

Putting out China’s financial fire

By Yu Yongding -
August 28

Earlier this year, rumours of China’s impending financial doom — triggered by either a housing-market crash or local-government debt defaults — were rampant. But in recent months, the economy has stabilised, leaving few doubts about China’s ability to grow by more than 7 per cent this year. Given that the government had ample scope for policy intervention, this turnaround should come as no surprise. But the moment of financial reckoning has merely been postponed, not averted.

Thursday, August 28, 2014

Emerging 'mini-bloc' within Asean a concern

Aug 28, 2014


By Pavin Chachavalpongpun For The Straits Times

IS SOUTH-EAST Asia witnessing an emergence of a bloc comprising Thailand, Myanmar and Cambodia, which could pose a danger to the unity of Asean?

It all began with the coup in Thailand on May 22 which overthrew the elected government of Prime Minister Yingluck Shinawatra.

After the coup, the National Council for Peace and Order, the governing body of the coup-makers, sought to lessen the effects of sanctions imposed by some Western nations. In doing so, Thailand quietly slid into the warm, embracing arms of China. But China is not the only friend in need for Thailand.

On July 4, Myanmar's supreme commander, Senior General Min Aung Hlaing, paid a visit to Bangkok, making him the first top leader from Asean to meet the Thai junta after the coup. He held a discussion with coup leader Prayuth Chan-ocha, to strengthen ties between Thailand and Myanmar.

Disturbingly, Gen Min Aung Hlaing praised the Thai junta for "doing the right thing" in seizing power. He also compared it to his country's experience during the political upheaval that took place in Yangon in 1988, when the tatmadaw - Myanmar's army - launched deadly crackdowns against pro-democracy activists. The general is a rising star in the tatmadaw and a possible candidate in the running to be the next president of Myanmar. Amicable relations between the two countries suggest a new alliance of quasi-democracy being established in the region.

Such an alliance soon welcomed a new member, Cambodia. On May 31, Cambodia's Deputy Prime Minister and Defence Minister, General Tea Banh, visited Bangkok and expressed his confidence in the leadership of the Thai military in bringing peace and order to Thailand.

Wednesday, August 27, 2014

35,000 older workers earn less than $1,000

Aug 25, 2014

Many work because they can't depend on children, but new govt schemes provide relief

By Radha Basu Senior Correspondent

The number of older workers taking home less than $1,000 a month has doubled to nearly 35,000 over the past decade, according to figures from the Ministry of Manpower.

That number has outpaced the natural ageing of the population, which had slightly more than 400,000 residents aged 65 and above last year, up 60 per cent from around 250,000 a decade earlier.

More elderly people may be working because there are fewer children to provide support, or the children themselves may be struggling with rising costs, said Assistant Professor Ng Kok Hoe of the Lee Kuan Yew School of Public Policy.

"Studies have shown that fewer parents are living with children and fewer are receiving cash transfers from them," said the social policy expert, who has published a paper on how poor Singaporeans may not be able to depend on their children as the primary source of retirement income for much longer.

"So some older folk may have no choice but to turn to work to make ends meet."

Although there are twice as many low-income elderly workers now, there was some good news in the statistics - only one in three earned under $1,000 last year, compared with one in two just five years earlier.

This could be the result of several recent government incentives to get more of the elderly into the workforce, said labour economist Randolph Tan of SIM University.

Companies get a Special Employment Credit to hire older workers. The tightened foreign worker tap has led to more jobs in the cleaning and service industries.

[Not sure if we should be happy that old people CAN work as cleaners if they HAVE to work as cleaners in their old age. But I guess we can be happy that there are jobs for them if they NEED it, but we should be concerned that they HAVE to work and NEED to work in their silver years.]

The unions have also pushed for the implementation of National Wages Council recommendations for a minimum $60 hike in the pay of older workers who earned below $1,000.

"Given the tight labour market, companies are being motivated to pay higher wages than before to woo Singaporean workers back to the workforce," said Associate Professor Tan.

In 2003, only about 12 per cent of those aged 65 and above worked; last year, that proportion doubled to 24 per cent.

Workers appear to be willing too. "They can now supplement take-home pay with Workfare, which has become an important pillar of social support," said Prof Tan. "So there are more incentives to work than before."

Workfare payments are made quarterly and not factored into calculations of gross monthly wages. A worker aged 65 who earns $1,000 a month, for instance, can get $350 in cash and $525 in Central Provident Fund grants every quarter from Workfare.

Prime Minister Lee Hsien Loong announced in his National Day Rally speech last weekend that the Government planned to institute an annual "Silver Support" bonus to help low-income Singaporeans aged 65 and above.

Member of Parliament Lily Neo, whose Tanjong Pagar constituency is home to many who are old and poor, said she hoped the bonus would be paid not just to retirees but also to working low-income Singaporeans.

Among them is mother of five Lee Soon Chiew, 67, who told The Sunday Times she works as a cleaner because she does not want to be a burden on her children. "They all have their families and don't earn much. I have no choice but to work," she said.

Hawker centre assistant Yip Chin Foon, 77, a sprightly single who works five hours a day, five days a week, said: "I do not want to depend on the Government. I just want to work as long as I can."

Tyre makers race to turn dandelions into rubber

August 20

MUENSTER (GERMANY) — Dutch biologist Ingrid van der Meer often meets with disbelief when she talks about her work on dandelions and how it could secure the future of road transport.

The reaction is understandable, given most people regard the yellow flowers as pesky intruders in their gardens rather than a promising source of rubber for tyres.

“People just think of it as a horrible weed and ask how can you get enough material for tires from just a small root,” she said.

Her research team is competing with others across the world to breed a type of dandelion native to Kazakhstan whose taproot yields a milky fluid with tyre-grade rubber particles in it.

Global tyre makers such as industry leader Bridgestone and No 4 player Continental AG believe they are in for rich pickings and are backing such research to the tune of millions of dollars.

Monday, August 25, 2014

5 incidents of public nudity in Singapore

Aug 08, 2014

[For the record]

Penang police are investigating a video showing 18 nudists, including Malaysians and four people from Singapore, taking part in nude events at a beach in Teluk Kampi, Penang National Park.

In Singapore, people have also been caught for being naked in public.

In an interview in 2010, Adam Road Medical Centre consultant psychiatrist Ken Ung said exhibitionists get a sexual thrill from the look of shock and horror on their victims' faces. Or, he added, they can be exposing themselves just to attract attention.

Those found guilty of appearing nude in public, or in a private location, but visible to those outside, face a fine of up to $2,000 and up to three months in jail.

When in China, never ask 'why'?

Aug 24, 2014

By Rachel Chang

Something has been in the air in Beijing recently. Or more accurately, not.

For the past two weeks, the air quality index has hovered below 100 - "moderate" - and sometimes even dipped below 50 to "good" territory, a reading as rare as a polite taxi driver in Beijing.

The broad, blithe explanation for this delightful state of affairs among Beijingers has been the Asia-Pacific Economic Cooperation (Apec) summit that China is hosting.

But that's in November. More importantly, if the government can make the air good at whim, why isn't it just good all the time?

Here, I suspect the answer has something to do with the ecological and likely unhappy side-effects of shooting silver iodide into the sky, which is how they make it rain so that the air is clear. Is it one of those awful trade-offs where every unit of silver iodide equals one dead bat somewhere far away?

Complexity: When 1 + 2 becomes 4

Aug 25, 2014


If you search for fix-its only after nasty surprises arrive, it may be too late. Singapore has leapt into the world of trend-spotting with more centres dedicated to finding ways to reduce its vulnerability to future shocks in today's highly unpredictable world. This is the first of a five-part series on experts in Singapore tackling the future today.

By M. Nirmala Senior Writer

MR JAN Wouter Vasbinder understands complexity science and tries to make it simple.

Think of a boy playing with sand on the beach, he says. The boy dribbles sand particles and starts to make a pile. He builds it higher and higher until, suddenly, it collapses.

The intricate connections and collisions between nature, human beings and systems are like that pile of sand on the beach, says Mr Vasbinder, 68.

And he points out a paradox - it was instability that first held the thousands of sand particles together, and it was also instability that caused the pile to crumble at some critical moment.

"Just one particle of sand can cause the pile to collapse. The trouble is, no one can predict when and which particle will cause the collapse," he says.

3 questions and answers on the Minimum Sum and retirement

Aug 17, 2014 

Sunday, August 24, 2014

Elderly poor need more than just a 'bonus'

Aug 24, 2014

As families shrink and fracture, children may be unable to be first line of support

By Radha Basu Senior Correspondent

I met Dr Alexandre Kalache back in 2011 and something he said then has stuck with me ever since as Singapore grapples with issues related to the rising number of old people.

The former head of ageing issues at the World Health Organisation pointed out that while Singapore had done exceedingly well in increasing life expectancy, it had miles to go in helping its elderly age with dignity.

Men and women in their 70s being forced to clean tables at hawker centres, scrub apartment blocks or slog in the hot sun as security guards were not signs of "active ageing", said the epidemiologist, who drafted two manuals on the issue and spent 15 years crafting ageing policies at the WHO.

He pointed out that much of the developed world already had "non-contributory pensions" - or handouts - for low-income older folk, saving them the indignity of hard labour at a time in life when many may want to retire and rest.

"I am all for active ageing, but if you have never had a decent job, don't know what job satisfaction is, to make you work till you practically drop dead is not human," he said.

Most expensive cities for expats - according to Mercer LLC (BBC news)

By Ye Eun Charlotte Chun

Working abroad may seem like a dream come true, but it can become a financial burden as corporate packages cover less. While Amsterdam, Hong Kong and Dubai have ranked as some of the most popular expat destinations, they also rank among the top 50 most expensive cities to live.

A recent survey by Mercer LLC pegged Luanda, Angola as the most expensive destination for expats. Based on factors such as currency fluctuation and availability of imported goods, some of the priciest cities might surprise you.

Large Dams Just Aren’t Worth the Cost


AUG. 22, 2014

THAYER SCUDDER, the world’s leading authority on the impact of dams on poor people, has changed his mind about dams.

A frequent consultant on large dam projects, Mr. Scudder held out hope through most of his 58-year career that the poverty relief delivered by a properly constructed and managed dam would outweigh the social and environmental damage it caused. Now, at age 84, he has concluded that large dams not only aren’t worth their cost, but that many currently under construction “will have disastrous environmental and socio-economic consequences,” as he wrote in a recent email.

Friday, August 22, 2014

The fiscal policy debate: Austerity versus stimulus


AUGUST 21, 2014

It is hard to believe, but almost six years have passed since the fall of Lehman Brothers ushered in the worst economic crisis since the 1930s. Many people, myself included, would like to move on to other subjects. But we cannot, because the crisis is by no means over. Recovery is far from complete and the wrong policies could still turn economic weakness into a more or less permanent depression.

In fact, that is what seems to be happening in Europe as we speak. And the rest of us should learn from Europe’s experience.

Before I get to the latest bad news, let us talk about the great policy argument that has raged for more than five years. It is easy to get bogged down in the details, but basically it has been a debate between the too-muchers and the not-enoughers.

Thursday, August 21, 2014

Experts worried about retirees squandering CPF monies

By Xue Jianyue and Linette Lim

20 Aug 2014 07:10

The Government has to find a “judicious balance” between ensuring sufficient funds for members’ retirement and allowing them to enjoy the fruits of their labour, MPs say.

SINGAPORE: While they acknowledged the need to provide flexibility in Central Provident Fund (CPF) withdrawals, especially for those who need cash for necessities, experts cautioned that allowing lump-sum withdrawals – albeit with limits – could lead to members squandering their retirement savings.

Wednesday, August 20, 2014

5 things to remember about Dakota Crescent

JUL 25, 2014


Bidding farewell to a precious piece of Singapore's history is always difficult.

Dakota Crescent, one of Singapore's oldest public housing estates, will be vacated by the end of 2016 to make way for new developments under Mountbatten's estate renewal plans.

The cosy block of flats just off Old Airport Road has been a sleepy refuge for the Singaporeans who call it home.

We look back at some of the features of Dakota Crescent.

CPF changes do not go far enough

Aug 19, 2014


By Hui Weng Tat, For The Straits Times

THOSE Singaporeans who have been anticipating announcements of significant changes to the Central Provident Fund system to improve retirement financing may be forgiven for feeling disappointed by Prime Minister Lee Hsien Loong's National Day Rally on Sunday.

While the Silver Support bonus payment for poor elderly is to be applauded, the other announced changes do not address the fundamental source of concerns about retirement adequacy.

The extension of the Lease Buyback Scheme to four-room Housing Board dwellings would increase the number of households which are eligible by another 363,000. This compares with the approximately 230,000 three- room and two-room HDB dwellings currently eligible for this scheme.

However, it is not clear if this will make any significant difference to the popularity of the scheme. The low take-up of the current Enhanced Lease Buyback Scheme already provides strong hints that the typical Singapore family would prefer to have the option of bequeathing their property to the next generation.

Rituals for babies who didn't make it

Aug 20, 2014


SHE was in the shower when her mobile phone rang. When she went to the phone and saw the number flashing on the screen, she knew her worst fear had come true.

"I just stood (there), shivering. The shower was still running behind me as I froze, shampoo dripping down my hair and body," Pearlynn Yip, 31, recalled with a shudder.

"I knew then that my baby boy had died."

Ten months have passed since the death of Madam Yip's premature twins, a girl and a boy.

Tuesday, August 19, 2014

Staying nimble, closing loopholes

Aug 19, 2014

MAS' move to regulate alternative investments is a welcome start, but it needs to respond more quickly to the evolving world of innovative financial products

By Yasmine Yahya, Assistant Money Editor

WHEN the Monetary Authority of Singapore (MAS) said last month it would start regulating two types of alternative investments, the move was praised by pundits and investors alike.

But in the same breath, some wondered why it had taken the regulator so long to embark on the initiative.

It has been years since thousands of Singaporeans lost money through these two categories of investments: collectively managed investment schemes and precious metal buyback schemes.

To those who have already been burnt, the current efforts of MAS are cold comfort. But for the sake of all other investors, these expanded regulatory powers are increasingly necessary.

Past experience has shown that no matter how many Singaporeans lose money through dubious deals, there are always more willing to bet their life savings on the next "sure thing".

China’s localised subprime risks

August 18
It is now widely accepted that the recent global financial crisis was actually a balance-sheet crisis. Long periods of negative interest rates facilitated the unsustainable financing of asset purchases, with high-risk mortgages weakening national balance sheets. When liquidity in the key interbank markets dried up, the fragilities were exposed — with devastating consequences.

Today, the rapid expansion of Chinese financial institutions’ balance sheets — which grew by 92 per cent from 2007 to 2011, alongside 78 per cent nominal gross domestic product (GDP) growth — is fuelling predictions that the country will soon experience its own subprime meltdown. Is there any merit to such forecasts?

Monday, August 18, 2014

Public must accept rise in hawker food prices

Aug 15, 2014

By Elizabeth Bennett For The Straits Times

FROM 2009 to 2010, I studied hawker centres in Singapore while on a Fulbright Fellowship. Before I even arrived, I came across articles suggesting that first-generation hawkers were dying or retiring, but their children were not taking over. These articles focused on the loss of certain foods and did not consider the potential effect on hawker centres. During my research, I concluded that hawker centres were endangered, though everyone I spoke with believed they would always exist.

Since 2010, there have been positive signs: The Government has improved stall rental policies, developed a training programme with master chefs and is building the first new hawker centres since 1986.

How hard disk drive sector lost its mojo

Aug 17, 2014

Twenty years ago, Singapore accounted for up to half the hard disk drives shipped across the globe. Soon, the last hard disk drive assembly plant will shut down. The Sunday Times traces the rise and fall of the industry and the lessons it holds for the electronics sector.

By Chia Yan Min

It was a perfect match: a small nation with no natural resources seeking compatible new industries for a long-term relationship and a cutting-edge technology looking for hard-working, reliable partners to help it take the next step forward.

It was the 1980s, and Singapore and the hard disk drive industry looked made for each other.

Their relationship moved quickly. From 1986 to 1996, Singapore accounted for up to half of the hard disk drives shipped across the globe and employed around 80,000 people in the industry. One academic called Singapore the "single most important location in the world for hard disk drive assembly".

Sadly, that match made in cyber heaven has hit the rocks.

Saturday, August 16, 2014

Three areas where CPF could be changed

Ng Jing Yng

August 16, 2014

The Government is reviewing the Central Provident Fund (CPF) system and all eyes will be on the National Day Rally, during which Prime Minister Lee Hsien Loong is expected to, among other things, outline measures to improve the system. Since President Tony Tan revealed in May that the savings and annuity schemes under the CPF system would be improved, Singaporeans have had much to chew on, with various suggestions mooted by experts and Members of Parliament.

TODAY senior reporter Ng Jing Yng looks at three areas where changes may be afoot.


At an Institute of Policy Studies (IPS) forum last month, Manpower Minister Tan Chuan-Jin said the Government was studying how CPF returns could keep up with inflation, while noting that current interest rates of between 2.5 per cent and 5 per cent across CPF accounts act as a buffer against inflation to some extent.

Tuesday, August 12, 2014

Income cap may help reduce inequality



Concern about rising wealth and income inequality has generated all kinds of solutions, often focused on improving the lot of the people at the bottom with measures such as minimum wages. But instead of putting a floor on what people get, why not put a ceiling on how much they get to keep?

The idea of a cap on income sounds crazy and most economists find it unthinkable — as evidenced by the cries of incredulity Oxford professor Simon Wren-Lewis recently elicited when he brought up the idea in an academic discussion. The obvious response is that anything of the kind would automatically kill economic creativity by destroying the wealth incentive that drives entrepreneurs to start new businesses.

But is this really true? Or does this way of thinking merely lack imagination? Maybe there is a clever way to design an income cap that would not deter business at all.

One idea comes, unexpectedly, from Mr Tony Hawks, a British comedian and writer. He is best known for the bestseller Round Ireland With A Fridge, a recounting of his effort to win a £100 (S$210) drunken bet by hitchhiking around the circumference of Ireland with a medium-sized refrigerator (he did it). He later wrote another book, Playing The Moldovans At Tennis, about his quest to track down, play and beat each of the members of the Moldovan football team one-on-one at tennis (he did that, too).

The poverty Mr Hawks encountered in Moldova, though, made him rethink the value of the wealth and fame he had achieved. He decided to donate 50 per cent of the royalties from his second book to a trust fund for beneficial projects in the country. A few years later, after the money had paid for a new care centre in Chisinau for children with cerebral palsy, Mr Hawks had an epiphany.

“I met the children and their parents, saw their smiles,” he recalled. “And the experience really enriched my life. I now actually feel good about myself. Undoubtedly, I feel happier since I did this.”

Mr Hawks’ realisation that doing good could prove far more valuable to him than the foregone 50 per cent of his royalties led to an idea: An income cap that would apply to money, but not to wealth in the broadest sense.


Suppose that people, after paying ordinary income taxes, would be allowed to keep up to, say, US$500,000 (S$625,000) of their income. They would then be obliged to give away the rest to charities of their choice — or, if they like, to a charity of their own design and creation.

Such a policy would encourage a rapid proliferation of philanthropic organisations competing to attract the money — much like the amassing of financial wealth has fuelled the money-management industry. More people would be able to find jobs doing good things and society would benefit from their efforts and resources.

The wealthy, too, would benefit. Many studies have shown that the more money one has, the less happiness one derives from each added dollar of income. This may explain why many of the super-wealthy, such as Mr Warren Buffett and Mr Bill Gates, ultimately turn to philanthropy — making yet more money matters little to them in comparison with what they can get back by helping others.

With Mr Hawks’ income cap policy, the wealthy would end up competing not only to earn the most money, but also to outdo others in making wise and useful gifts to the best charities, or to start and manage charities reflecting their values. A virtuous circle would be created. The philanthropic activity generated by such a policy might significantly decrease the need for many taxpayer-funded government programmes, reducing the need for income taxes.

The idea actually resonates quite well with the spirit of capitalism. Huge taxes on the rich do not work: They naturally breed resentment and stifle creativity. Governments are often very bad at redistributing the money efficiently. Besides, people should not be punished for working hard and being successful. They should be rewarded and encouraged.

People care about more than money and our policies should harness this fact in a smart way. Mr Hawks has at least the nub of a very good idea. It might not be the ultimate answer, but it has the seeds of something very clever in it. We need to work harder at imagining what might be possible with policies that encourage the better parts of human nature, rather than merely channelling people towards gaining as much wealth as possible.

As a result, they might be happier.



Mark Buchanan, a physicist, is the author of the book Forecast: What Physics, Meteorology and the Natural Sciences Can Teach Us About Economics.

Monday, August 11, 2014

Winning every battle but losing the war

 Aug 11, 2014

Israel's military superiority has become its Achilles heel, causing the Jewish state to lose the public opinion war.

By Jonathan Eyal, Europe Correspondent

WHEN Israel comes under attack, all its leaders draw together, and their first instinct is to reach for the gun.

So, even a moderate politician like Mrs Tzipi Livni, who as leader of the opposition frequently argued for a negotiated settlement between Israel and the Palestinians, said recently that the "fanatical movements" which Israel is currently battling "need treatment, and not of the psychological variety".

That's precisely what Israel has done in Gaza: it has pummelled the impoverished Palestinian land strip, using all the sophisticated weapons it can muster.

And the result was predictable: As in all of Israel's previous wars, Palestinian casualties were numerous, the international community was shocked but did nothing, ceasefires were negotiated and then promptly broken.

Singapore’s fight against the 3Cs


AUGUST 11, 2014

Many in our pioneer generation remember World War II, as we had lived through a harrowing three years and eight months in the early 1940s under Japanese Occupation. The war hardened the will of a new generation of leaders in Malaya and Singapore to end colonialism. They were determined to achieve independence so their people could decide their own destinies. In doing so, they had to overcome three major political challenges, or what I call the 3Cs — colonialism, communism and communalism.

Today, fresh from celebrating 49 years of independence, it is useful for all of us in Singapore to remember the fight against the 3Cs and the lessons it holds for a nation at a crossroads.

Sunday, August 10, 2014

Are US-China relations beyond the tipping point?

 Aug 06, 2014

By Mark J. Valencia For The Straits Times

MANY analysts in both the United States and China have warned of a "tipping point" in China-US relations beyond which the two nations conclude that conflict is unavoidable and begin preparing for it in earnest while trying to hide their true intentions.

This is different from hedging in that there is no easy way back. Beyond the tipping point, the national mindset and policy decisions inexorably flow towards conflict.

Such a clash of titans would not be a new phenomenon. In classic realist theory, established powers strive to preserve their position at the top of the hierarchy and view emerging powers as potential threats. Rising powers, on the other hand, feel constrained and strive to stretch the sinews of the international system.

Rising powers also fear that the dominant power will try to snuff them out before they become an existential threat. Athenian historian Thucydides described this process with respect to the relationship between Athens and Sparta as inevitably leading to war. Today, the situation is known as the "Thucydides trap". The international relations question of our age is: "Can China and the US avoid it?"

The situation really is serious, and growing worse by the day. It is now clear that China expects to play a major role in global affairs. It wants to be a new rule maker and an old rule breaker in order to become an "exceptional" country like the US. The accommodation of such a role for China by the US is what President Xi Jinping presumably meant when he proposed a new type of major country relationship at his Sunnylands summit with US President Barack Obama in June last year.

But as Mr Ashley Tellis argues in his new book, Balancing Without Containment: An American Strategy For Managing China, "the loss of primacy to China would fundamentally undermine the national security interests of the United States in the most comprehensive sense imaginable".

Already, it seems, we may be witnessing a fundamental US foreign policy failure in East Asia. The US has not been able to unify Asean against China, stem China's assertiveness or even enhance stability in the South China Sea. Its "pivot" towards East Asia has only made the region more unstable and a point of contention between it and China. Washington's attempts to impose an interim solution to the disputes there have so far failed.

The chairman of the US Joint Chiefs of Staff, General Martin Dempsey, believes the risk of war in Asia will increase over the next 10 years as the US military technological edge over China erodes. One indication of a change in Washington's mindset was a move by the US Air Force to deploy significantly more B-2 stealth bombers and advanced B-52H strategic bombers to Guam.

In a clear allusion to China, a frustrated US Defence Secretary Chuck Hagel told a security conference in May this year that "the United States will not look the other way when fundamental principles of the international order are being challenged".

Mr Tellis proposes that "the US pursue policies that simultaneously increase China's stake in the existing global system and raise the costs of abusing its power". His strategy would also require the US to support states around China by increasing "cooperation" with them.

This is already happening. According to Mr Daniel Russel, US Assistant Secretary of State for East Asia and the Pacific, "we joined EAS (East Asia Summit) because, as an Asia-Pacific nation, we want to be at the table for a strategic discussion about how we build and shape the institution over time".

Another element of this strategy is the enhancement of the US military as a deterrent, in a way that reassures US allies and convinces fence-sitters to lean towards it while dissuading China's assertiveness towards its neighbours. The last element is to promote "the highest velocity of technical change possible across the spectrum of civilian to military endeavours" - essentially to out-create and out-think China technically and economically. This is the key to US dominance.

China, however, sees the tectonic plates of the global international political system shifting, with the US and China on opposite sides of the divide - and perhaps history. The US is yesterday's and today's sole superpower but its credibility, legitimacy and ability to impose its will are fast eroding.

Indeed, America no longer rules the global system. As Mr Eric X. Li, a venture capitalist in Shanghai, put it in a recent New York Times commentary: "The US is deeply in debt; its middle class is crumbling; its industries have been hollowed out; its infrastructure is in disrepair; its education system is badly underfunded; and its social contract is in shambles." It is also squandering blood and treasure as it tries in vain to sustain its dominance.

China's leaders believe China represents the future, not just in hard power but also in economy, culture and values. Many of its neighbours are keenly aware of this distinct possibility, and are thus hedging and trying to manoeuvre between the two.

If the US wants to avoid direct conflict - or at least postpone it - (it is not clear that the US is trying to do either) it has to accommodate to some degree China's international interests and aspirations by sharing power. When and how to do this, and on what issues, are challenges for US government thinkers to ponder. For its part, China needs to prove by its actions that it will not use force to settle disputes.

The two nations have fundamental differences and conflicting national interests. Perhaps the tipping point has already been breached. If so, all we policy analysts and policymakers are doing now is akin to rearranging the deck chairs on the Titanic.

The writer is an adjunct senior scholar at the National Institute for South China Sea Studies in Haikou, China.

[See also, "China's Bad Dream", for a perspective from the other side.]

Friday, August 8, 2014

US judge hands Indonesian wine forger 10 years' jail

08 Aug 2014

NEW YORK: Disgraced wine dealer Rudy Kurniawan was sentenced to 10 years in prison on Thursday (Aug 7) after he was found guilty of manufacturing fake vintages and selling them for nearly US$30 million.

The Indonesian-born 37-year-old, once considered one of the top five wine collectors in the world, was convicted in December of blending hundreds of bottles in his kitchen and selling them as rare vintages.

"This was a very serious economic fraud, a manipulation of US and international markets," said Judge Richard Berman. Donning glasses and blue prison garb, Kurniawan was motionless as he heard his fate. "I'm very sorry for what I have done," he muttered in an almost inaudible voice.

Thursday, August 7, 2014

Russia’s Eurasian vision



The escalating conflict in Ukraine between the Western-backed government and Russian-backed separatists has focused attention on a fundamental question: What are the Kremlin’s long-term objectives?

Although Russian President Vladimir Putin’s immediate goal may have been limited to regaining control of Crimea and retaining some influence in Ukrainian affairs, his longer-term ambition is much bolder.

That ambition is not tough to discern. Mr Putin once famously observed that the Soviet Union’s collapse was the greatest catastrophe of the 20th century. Thus, his long-term objective has been to rebuild it in some form, perhaps as a supranational union, like the European Union (EU), of member states.

Why Israel vs. Palestine Is Different This Time Around


Because the conflict that seems like old news is actually very different this time around.

Israel-Palestine, erupting again. This feels like very old news.

From a distance, the current fighting between Israel and Hamas — the Palestinian faction that rules the small and highly populated Gaza Strip — seems much like the hostility the region has known for decades.

But this time, it’s different — because this time, the two are at war just as the surrounding Middle East descends into total turmoil. And when everything abates, the two sides will end up even further from an agreement than they have been for years.

Wednesday, August 6, 2014

China’s bad dream



Since his first address as China’s President last year, Mr Xi Jinping has been espousing the so-called Chinese Dream of national rejuvenation and individual self-improvement.

But the imperative of addressing the unprecedented amount of debt that China has accumulated in recent years is testing Mr Xi’s resolve — and his government is blinking.

The Chinese government’s uncertain ability — or willingness — to rein in debt is apparent in its contradictory commitment to implement major structural reforms while maintaining 7.5 per cent annual gross domestic product (GDP) growth.

Given that China owes much of its recent growth to debt-financed investment — often in projects such as infrastructure and housing, meant to support the Chinese Dream — any effort to get credit growth under control is likely to cause a hard landing.

This prospect is already prompting the authorities to delay critical reforms.

Putting on ‘veil of ignorance’ for a just society

By Teh Hooi Ling -
July 18

We live in a diverse world — one that always has been, and always will be diverse. Today, communities are made up of people with different cultural backgrounds, religious beliefs and value systems.

How do we negotiate our differences so that everyone can live with respect and equality, and is valued as individuals free to make informed and responsible choices about their lives?

Going with the majority is not always a wise approach. In ancient Rome, some Christians were executed as common criminals — some were fed to the lions in the Colosseum to much delight and amusement of the crowd — for refusing to revere the Roman gods.

If we were to live during ancient Roman times, no doubt we would want to be able to practise a faith different from the majority, should we choose to, without being persecuted.

Doing things the Beijing way

20 Jul 2014

By Rachel Chang
For all its gleaming trappings, by the standards of global cities, Beijing is still a closed-off place.
Even for a Singaporean, whose ethnically Chinese physical appearance and grasp of Mandarin should suggest a relatively seamless entry, it's unexpectedly difficult.
For one, life is designed with only a monolithic Chinese nation in mind. Participation in everyday activity in modern Beijing - buying subway tickets from the machine, setting up an Alipay account (China's version of Paypal), using taxi-hailing apps - still assumes the possession of a Chinese identification card.
The passport is sometimes accepted, but they reveal this fact to you and how to proceed as grudgingly as the Chinese government issues visas to foreign journalists.
Then there's the fact that when it comes to the Internet - basically the thing that's more important than all other things in everyone's lives - there is The Internet, which connects the whole world, and then there is China Internet, which connects the whole of China and divides it from the world.

Why Nanjing never forgets

Jul 20, 2014

Japan's decision to let its troops engage in armed conflict has again inflamed anti-Japanese sentiment in China, especially among survivors of forced labour during the Sino-Japanese War and people in Nanjing, where the memory of the 1937 massacre looms large. They tell The Sunday Times why they cannot forgive and forget.

By Rachel Chang

Nanjing native Lu Yanfa, 52, remembers well the stories of Japanese wartime aggression that he heard as a boy on his grandmother's knee.

When Japanese troops invaded China in 1937, she was a teenager, a dangerous age for a girl in wartime. So she and her sisters would smear ash across their face to avoid attracting the soldiers' lustful attention.

"This history is in our blood, not from textbooks or TV. That's why we are so worried about what is happening in Japan," said Mr Lu, a security guard with a daughter, 19.

"First, they denied what happened in the war, the massacre and the comfort women. Now they are letting their troops fight wars again. We don't want war, but China can never let what happened in Nanjing happen again."

[Not to be insensitive, but the best way to prevent what happened in Nanjing is to ensure that China (or Nanjing) has proper defensive capabilities to fight off any would-be invaders, no?]

Monday, August 4, 2014

Warning: Prams ahead

Aug 03, 2014

By Jeremy Lee

Step into any shopping mall in Singapore on a weekend or public holiday and one faces a battle of epic proportions.

Apart from the usual hordes of shoppers, there lurks a greater menace: Prams.

But before a ruckus erupts on how insensitive a childless person like me is to parents who are doing their Singaporean duty of going forth and multiplying, let me just slip in the small observation that most of these prams that I have seen… do not actually have babies in them.

I feel that some parents' overuse, and misuse, of prams is a truly distressing social ill.

I have encountered criss-crossing convoys of prams bearing down walkways, their pushers using them as battering rams to clear the crowd before them, leaving those who just have their own two legs desperately trying to avoid being mowed over.

Sometimes, the pushers don't even have the decency to utter words of contrition.

A friend once had his foot rather painfully rolled over by a pram, with its pusher only spewing sounds of annoyance at the foot that dared to get in its way.

Worse, these pesky perambulators also contrive to take up much space in the lifts. The buggys have now turned into luxury models, with more bells and whistles than Chitty Chitty Bang Bang.

The wait for a lift on a busy weekend can already be interminable, but finding yourself unable to get in after waiting for ages, due to one of these "S-Class" prams, can literally drain the colour from your face.

I have seen such monsters and their associated adornments take up space in a lift that could have fit four people. Such a small human being, but it takes up so much space, I always think.

More annoyingly, though, a great number of prams I have seen in public seem to be used for nothing more than as shopping carts, with the children that they're meant to be transporting often being carried or merrily skipping alongside the hefty purchases.

Some other prams I've seen do actually have humans in them, but I do not consider them "babies" as it's obvious that they are old enough to actually walk.

In my humble opinion, as soon as a child can walk without falling flat on his face, he's too old to be pushed around by his loving but perhaps misguided parents.

Unfortunately, many parents don't seem to share my view. Once, in Orchard Cineleisure, I saw a girl who looked to be close to primary school-going age sitting in a pram pushed by a struggling young woman. The girl was wearing heels and absorbed in her iPad, oblivious to the world. If the girl can wear heels, surely she can walk in them? Or perhaps she's too busy playing Candy Crush to actually pound the pavement?

The root word of "perambulator", which "pram" is a contraction of, is "perambulate", which means "To walk, wander, or travel from place to place", according to the Oxford English Dictionary.

"Perambulate" is, in turn, derived from "ambulate", which means "to walk". Isn't it ironic that a pram now ensures children don't walk?

As far as my memory serves me, I was running everywhere at the age of three or four , and it was my parents who got tired trying to keep up.

My mother tells me I never sat in a pram as soon as I could walk. Are the children nowadays somehow weaker or less healthy? Or was I just special, imbued with almost-superhuman reserves of energy?

A good friend of mine, a kindergarten principal with about 15 years of teaching experience in the childcare and kindergarten industry, has seen many children who have been energetically running and climbing all day only to hop into a pram when their parents arrive to pick them up.

Did they suddenly and inexplicably become very tired as soon as their parents appeared with a pram or did the appearance of the "mothership" induce a reverential stupor?

I fear that we are doing more harm than good to the next generation by mollycoddling them. I'd rather my children build up their muscles, take a few knocks even, so they can get used to using their limbs at a young age, rather than become fully grown "invalids".

And if people can't help but push their children around, is it too much to ask that they do it with a little more graciousness and sensitivity towards the people around them who are inconvenienced, rather than just expecting the world to give way?

One of JFK's Secret Service Agent's story

Not exactly news, but interesting account of a historical event.

Join Date: Jun 2004
Location: At the Diogenes Club
Posts: 47,418
Meeting one of JFK's Secret Service agents

On June 23, I had the chance to meet retired U.S. Secret Service Special Agent Paul Landis.

He spoke at a northeast Ohio courthouse and was introduced by a judge who knows him and is personally interested in President John F. Kennedy's life and times. Landis, who served in the Secret Service from 1959-1964 and is now retired, spoke to a crowd of about thirty.

He is a quiet, slim man who gives an impression of diffident sadness. In the late 1950s, he had a friend who worked for the Secret Service and who encouraged him to apply after his graduation from Ohio Wesleyan University. The Secret Service at that time did not require any previous law enforcement experience, just a college degree. He underwent a thorough background check and training, and was sworn in as a Secret Service special agent in 1959. He started work in the Cincinnati field office but, within six months, was assigned to guard the grandchildren of President Dwight D. Eisenhower in Gettysburg, Pa. (Agents today may spend up to seven years in other posts before being assigned to protective duty, he said).

In October 1962, he was assigned to the White House Detail – the youngest person up to that time, he thinks. He was assigned to protect First Lady Jacqueline Kennedy and the two Kennedy children, Caroline and John Jr. (“the Kiddie Detail,” as it was known). He got the assignment just before the Cuban Missile Crisis, and he remembers three Marine helicopters being flown to the South Lawn of the White House to evacuate the President, First Lady and key staff in the event of an incoming Soviet nuclear attack. He asked what he should do if an unauthorized person tried to get on the First Lady’s helicopter and was told, “Just shoot ‘em, and we’ll worry about the consequences later.” Fortunately, it never came to that. He later accompanied Mrs. Kennedy on a trip to Ravello, Italy, and to Greece with her sister, Lee Radziwell. He still remembers the “opulence like you couldn’t believe” of Aristotle Onassis’s yacht, including its gold fittings, disco and swimming pool. He was assigned to Mrs. Kennedy when she gave birth to Patrick Kennedy in the fall of 1963; the baby died soon afterwards.

Landis was assigned to the fateful November 1963 Presidential visit to Texas. It was the first time he’d been on motorcade duty, although he’d trained for it. He was on the advance plane for Love Field in Dallas on November 22, and helped his friend and fellow agent Clint Hill guard Mrs. Kennedy as she greeted well-wishers along the fence at the airport; the President was further along the same fence. Consistent with Landis’s training, he would look at hands and faces, watching for any weapon or threat. In the motorcade heading into downtown Dallas, he was in the followup car directly behind the Presidential limosine. The crowds got so big, overflowing into the street, that the Dallas Police motorcycle outriders sometimes had to drop behind the limo. “It was like driving into a funnel,” Landis said.

The motorcade had to slow down considerably when it entered Dealey Plaza, making two turns, to the right and then to the left. The limo’s and the followup car’s bumpers almost touched. After the final turn, as the motorcade headed towards the triple overpass and the School Book Depository dropped behind them to the right, he heard what he immediately recognized to be a gunshot (from his many years of hunting) from behind him and to the right. He looked over to his right, but saw nothing threatening in the crowd. He looked forward again and saw President Kennedy slump in his seat. After a brief pause, he remembers two more shots following in quick succession, still behind and to his right. Landis was looking directly at Kennedy from “about 15, 20 feet” behind him, when “I saw the President’s head explode [and knew] no way could anyone survive that.” Clint Hill jumped off the followup car, ran forward and climbed onto the back of the President’s limo, and covered the President and First Lady with his body as the motorcade accelerated out of Dealey Plaza. Landis saw Hill look back and give a thumbs-down, indicating that the President’s condition was bad. Landis shouted to the driver of the followup car, “Go, go, go!”

The motorcade sped to nearby Parkland Hospital. Landis ran up to the Presidential limo and saw that Mrs. Kennedy was shielding her husband’s badly-wounded head. Hill took off his suit coat to cover it and persuaded her to let hospital staff take the President inside. Landis carried Mrs. Kennedy’s famous pink pillbox hat into the hospital but doesn’t know what became of it after that (it has since been lost). He stayed with the First Lady at Parkland, as he had been assigned. He went with her briefly into the trauma room twice. He was there when other Secret Service agents insisted on removing the President’s body to return to Washington, even though local police and the Dallas coroner insisted it had to remain for an autopsy there under Texas law. “It got a little tense,” he said, “but we said we were going, and we did.” He helped put the coffin in the hearse, and then rode in the hearse as it took Mrs. Kennedy and the President’s body back to Love Field. Once the former First Lady was settled into the back compartment of Air Force One, he went forward and found a seat, where “I just broke down.” He was very sad but knew he still had a job to do. When Mrs. Kennedy attended Lyndon Johnson’s swearing-in as President, he was standing in the doorway nearby.

Air Force One returned to Washington, of course, and he now remembers little of the trip; it seemed he was in shock. He was there when the coffin was removed from Air Force One and was taken by Navy ambulance to Bethesda hospital. He stayed with Mrs. Kennedy while the autopsy was underway, and then returned with her and the body to the White House. He guarded Mrs. Kennedy for another six months but quit after she took an impromptu trip from Chambersburg, Va. to Palm Beach, Fla. with her friend Bunny Mellon. He didn’t have time to pack clothes for warmer weather and decided he had just finally had enough of the frequent travel that Secret Service work required (being on the road an average of 300 days a year). Hill said, “You’ll never quit,” but Landis submitted a one-sentence resignation letter the next time he was in Washington. Hill called him within the hour and said ruefully, “You really did it, didn’t you?”

Landis purposefully didn’t read anything about the President’s death until the recent 50th anniversary of the assassination. He has long been reluctant to talk about it, and still seems haunted; he and his fellow Secret Service agents had a mission in Dallas that day but failed to carry it out, he said. He has since spoken to Clint Hill often, and they mutually realized the problems they’ve had over the years were in part because they’d never had the chance to talk through what they saw and experienced in Dallas. He and Hill are now in touch every week or so, and both contributed to the books Mrs. Kennedy and Me and The Kennedy Detail. Landis meets yearly with the association of retired Secret Service agents, and agreed to take part in a Discovery Channel special on the agents who had been in the Kennedy detail, tied to Hill’s book.

There were some skeptics of the Warren Commission's findings in the audience. During Q&A, Landis was adamant that the President’s body was not secretly removed from the plane, tampered with and then taken by another route to Bethesda naval hospital, as some conspiracy theorists suggest. Landis submitted a written report to the Warren Commission but wasn’t interviewed by Commission staff, which surprised him at the time. Landis believes that Lee Harvey Oswald was the sole assassin, as alleged by the Commission (“Three shots and Oswald”), but said he did not personally believe the “magic bullet” theory, given Texas Gov. John Connally and his wife’s testimony as to when and how he was hit.

He denied that the agents he was with had been drinking the night before the assassination. They got to their hotel in Fort Worth around 11pm, were starving and went looking for something to eat, but did not consume alcohol. He said the Secret Service had no individual radios or walkie-talkies in 1963, but agents relied on hand signals to communicate with each other. They wore sunglasses to shield their eyes and also to keep others from seeing where and at whom they were looking. They were issued standard police revolvers and had some Army surplus M-1 carbines, one of which he carried in a golf bag while protecting President Eisenhower on the links in Gettysburg. It was at his suggestion that the Service got one of the new AR-15 machine guns for field testing, and one was in the followup car in Dallas (and can be seen in the hands of an agent in photos as the motorcade sped towards the hospital).

Landis thought very highly of the President and Mrs. Kennedy, who were always friendly and warm with their agents. The first time he saw JFK, he held a door open as the President walked down the Rose Garden colonnade towards the White House residence. The President nodded pleasantly at him and smiled. The next day, when Landis again held the door, JFK asked, “And how are you today, Mr. Landis?”, so the agent knew the President had asked someone who he was and had remembered his name. Landis knew, going to Dallas, that there was considerable hostility towards the President there, but thought, “What’s not to like? It’s personal, not political.” He simply nodded wryly when asked if there were tensions between the Kennedys and the Johnsons, and their respective staffs, as well as between the Secret Service, the FBI and CIA.

He has been back to Dallas just twice, the first time in 1983, twenty years after the assassination. He later visited the Sixth Floor Museum with Hill and they quietly joked, “What would these people think if they knew it was us looking around up here?” It was very difficult for him to go back, and he “tried to convince myself there was nothing I could have done” to prevent the assassination. He now believes that averting the tragedy would have been an “impossibility,” given what was known at the time, the President’s outgoing nature and his often-stated reluctance to be surrounded by an imposing phalanx of guards. JFK once jokingly asked, after a group of agents were clustered on the back of his car, for “those Ivy League charlatans” to back off. The bubbletop cover of the limo, which was not bulletproof but might at least have obstructed Oswald’s view or deflected a bullet, was not put on that day given the good weather and the President’s desire to be seen by the Dallas crowds

Landis did not keep in touch with Mrs. Kennedy or her children after leaving the Service. He bumped into her on a New York City street around 1970 or so, by happenstance, as her limo pulled up at the salon of Mr. Kenneth, her hair stylist. She was very friendly and greeted him by name. He lived and worked in New York for awhile for a firm which produced TV commercials, and later was briefly a realtor in Massachusetts. He moved back to northeast Ohio in 1975, and is now retired but for his security work for a local historical society.

I had the chance to shake his hand, speak briefly with him, and thank him for his service.

Sunday, August 3, 2014

Singapore's forgotten islands

Aug 03, 2014

Balik Pulau exhibition offers rare glimpse into nation's past and ways of life long lost

By Ho Ai Li

Kusu, Sudong and Lazarus. Even if you have never set foot on these outlying islands of Singapore, chances are you would have heard of them. More so Ubin, Tekong and Sentosa.

But what about Rabbit Island or Pulau Sakra, Sebarok or Sekudu? They don't even exist "on the margins of our mental landscapes", as organisers of the ongoing Balik Pulau (Return To The Islands) exhibition at the National Museum of Singapore so piquantly put it.

Many of the outer islands didn't exist for me until I visited the exhibition recently. Yet, Singapore once had as many as 77 islands, and still has about 40.

Before Singapore became a key node in Britain's global shipping empire, its identity was anchored in a network of islands in the Riau Archipelago.

A series of heritage activities and a Drama Box play this year have helped Singaporeans to reclaim some of these forgotten isles - dozens of which have been lost to the tides of history - and to reimagine Singapore's identity and position.

One significant island lost to us is Pulau Seking. As big as 10 football fields, it was home to the last southern island kampung community before it gave way to a landfill.

Many islanders were said to be descended from the nomadic Orang Selat, or People of the Straits. For centuries, they fished or built boats, although many later became wage-earners as technicians on nearby Pulau Bukom.

Seking had a Malay primary school that closed in the early 1980s, after which its pupils had to commute by motorised sampan to the main island for classes.

By 1994, the last residents - nearly 200 in all - had been relocated from their sea-facing kampung houses on stilts to high-rises on the main island. On their island, there had been no roads, no cars, just a lot of goats.

Provision shopkeeper Teo Yan Teck, 83, was one of the few Chinese on Seking. Interviewed on camera by organisers of the mu-seum exhibition, he was asked how he felt about leaving the island. His face crumpled, and he could only utter a silent cry.

Seking has since been joined to an adjacent island to form Pulau Semakau, a huge landfill for rubbish.

I knew nothing of Seking until I attended a recent talk at the mu-seum, held as part of the Singapore Heritage Festival.

Temasek Polytechnic lecturer Normala Manap, who did an anthropological study on Seking in 1982, said at the talk: "The fact that we have let Seking become a landfill (means) we have lost a big opportunity to get insights into Singapore's roots and history."

Old and young, the islanders had a deep sense of the history of Seking, which got its name from a fable about its founder Yang Meleking. Goats were released by Chinese devotees as an offering to the benefactress, who is said to have battled pirates to found the isle.

As documented in The Sea Nomads by cultural geographer David Sopher, the Riau Archipelago was home to nomadic seafarers, who lived with their families on boats and sailed from one mangrove coast to another. Some were also pirates.

As Ms Normala put it, Seking's residents looked to a wider Malay world than Singapore.

Anthropologist Vivienne Wee, who studied Seking previously and was a panellist at the same talk, said many of its residents would go by sampan to Pulau Pangkil in Bintan to attend relatives' weddings.

Most younger Singaporeans do not know about Seking, partly because there was hardly any public discussion about whether it should be preserved - unlike in the case of Pulau Ubin, home to Singapore's last surviving village community.

Dr Wee noted that former Nominated Member of Parliament Kanwaljit Soin was the only one to question the move to destroy the settlement in Seking, in Parliament in 1993. Dr Wee said turning the island into a landfill was a "demolition and rubbishing" of its history.

Another significant isle whose history could be better known is Pulau Senang. Now known largely as the location for military live-firing exercises, it was a penal settlement from 1960 to 1963, and the site of a bloody riot that took place in 1963.

Older Singaporeans know the incident well, but most younger people do not. I certainly didn't before May this year, when I watched the Drama Box play Senang, about the experimental prison without bars.

In this dramatic retelling, British warden Daniel Dutton experiments with hard work as a way to reform the detainees on Senang. But he becomes increasingly severe in his demands, forcing them to build a jetty in harsh weather on one occasion. An uprising by the detainees on July 12, 1963, led to the deaths of four officers, including Superintendent Dutton, and brought the shutters down on the experiment.

Senang is a reminder of how the islands were natural sites for imprisonment and exile.

Sentosa the tourist magnet used to be called Pulau Belakang Mati and was once a military base.

In 1970, it was renamed Sentosa, which means "peace and tranquillity", from the Sanskrit word Santosha. Long-time political detainee Chia Thye Poh, arrested in 1966, was confined to Sentosa from 1989 until his release in 1992.

Sentosa as we know it today is an amalgamation of several smaller isles, just as petrochemical hub Jurong Island is made up of islands in the Ayer Chawan archipelago.

A short film shown along with the exhibition sums it up well, noting: "The story of Singapore's islands is one of growth, in size and economic significance, and loss, in numbers and nature, as habitats and homes give way to the needs of a modern city."

In 1998, long after many of Singapore's islands had disappeared, then Indonesian president B.J. Habibie dismissed Singapore as being no more than a little red dot.

Singaporeans have since embraced that nickname, using it to underline how this little island nation has transcended size to take its place on the world stage.

But a red dot doesn't show context. Zooming in on our many islands past and present allows us to see mudflats and porcelain shards, and ways of life long forgotten, yet still part of our history.

Wanted: A new CPF vision

Aug 03, 2014

Tweaks over the years got in the way of original aim of providing for old age

By Han Fook Kwang, Editor At Large

What is it about the Central Provident Fund (CPF) that has attracted so much public discussion lately?

You would have thought that one of Singapore's most enduring social policies with an almost 60-year history would be well understood and accepted by now.

But debate and misunderstanding persist about its core purpose, how it works and how it affects different people, growing louder and more pronounced in recent months.

The Government has had to give repeated assurances that CPF money belongs to the people even if there are rules about how much can be withdrawn after retirement.

There are advertisements in the newspapers daily explaining how and why the scheme works the way it does.

Yet, talk to people and many don't seem able to grasp what it all means.

Saturday, August 2, 2014

Guaranteed rates of CPF due to GIC pooling of funds

If the GIC managed CPF funds as a separate pool, and not together with other government assets, the interest rates that the Government has committed to would be unsustainable, Deputy Prime Minister Tharman Shanmugaratnam told Tuesday’s CPF forum. Mr Tharman was responding to questions from blogger Roy Ngerng, who is being sued by the Prime Minister for defamation. Mr Ngerng fired off four questions and Mr Tharman, who is also Finance Minister, answered them in turn. Here is an edited transcript of the exchange.

Jul 25, 2014 

ROY NGERNG: Now that we know that the CPF is invested in the GIC, is it also possible to know what is the interest earned in Singapore dollar terms since inception?

Second, Temasek Holdings has said that they do not invest our CPF. The GIC was set up only in 1981, so prior to 1981, how was the CPF used and was it invested in Temasek Holdings?

Third, how much has the Government earned in absolute monetary terms from the excess returns of the CPF and will the Government consider returning some of them to Singaporeans?

Finally, the GIC has said before June this year that they do not know if they invest our CPF because it is not made explicit to them. But in June, the Government admitted that they do. So in the public interest, is it possible to know why the Government made an about-turn?

DPM THARMAN: You asked some factual questions. Did Temasek manage the CPF funds in the past? No. It has never managed CPF funds. Temasek started off with a set of assets which were transferred by the Government at the time of inception – I don’t have the exact figure in my head – but about $400 million worth of assets in the form of a set of companies. It has never received CPF monies to invest.

Before we amended the Constitution in 1992, CPF monies, which were invested in Special Singapore Government Securities (SSGS), could be used by the Government to finance infrastructure – such as road infrastructure, Singapore’s economic infrastructure and social infrastructure. Just like (other) Singapore Government Securities (SGS), the Government was allowed to use borrowings in addition to the revenues it got in its Budget, to finance infrastructural investments. That was the old system.

That changed in 1992. Together with constitutional amendments, we introduced the new Government Securities Act, which disallowed the Government from using borrowings for spending. From then onwards, all borrowings – the SGS, SSGS – have had to be invested.

How are they invested? Prior to the formation of the GIC, it was the MAS (Monetary Authority of Singapore). It was an old-fashioned, central bank investment system. Dr Goh (Keng Swee) changed that, explained why, explained that these are basically longer-term assets, and we should invest them for the longer term. And a significant chunk of reserves that were managed by the MAS was passed back to the Government, which then had the GIC manage them.

After the GIC was set up in the early eighties, it was essentially the GIC that managed CPF assets, but not as CPF assets. It is managing government assets: all government assets put together.

GIC knows it is managing government assets. That is the Government’s mandate for the GIC. The mandate is irrespective of the source of funds it manages, which comprise the SSGS, the SGS, government surpluses, the proceeds from land sales – all government funds. The GIC (hence) pays no regard to what the source of funds is. It just has to meet its mandate: to invest for the long term, take risks, in the hope of achieving good long-term returns, significantly above global inflation.

And that is a real strength of our system, that besides the CPF, we have unencumbered government assets – government assets that don’t have liabilities like the CPF. If the GIC was just managing CPF funds as a CPF fund manager, it would be managed quite differently. To provide a guaranteed interest rate of 4 to 5 per cent of the Special Account, or 2.5 to 3.5 per cent of the Ordinary Account, capital guaranteed and interest rate guaranteed, it would be a very different fund that it would be managing. It would be invested largely in bond securities, and earning returns that are very different from what it is able to earn by investing for the long term in higher-risk assets. Plus, it would mean the interest rates that the Government has committed to would be unsustainable, because it is no longer possible to earn these interest rates on a guaranteed basis, using a bond portfolio. It’s very difficult.

So the GIC manages a pool of government assets, irrespective of sources of the funds. It is the Government that then takes the risk. The Government takes the risk that the performance of the GIC from year to year, sometimes even over five-year periods, may not be adequate for it to meet commitments to the CPF. 

The strength of the system is we have assets that exceed our liabilities, that enable us to meet our commitments. And that’s why we’re not just triple-A rated, but we’re able to provide CPF members with a very fair return on a guaranteed basis.

Next question had to do with excess returns. The GIC publishes five-year, 10-year, 20-year returns, and they are easily computed into Singapore dollars. Over the last five years it earned 0.5 per cent in Singdollar terms, over the last 10 years it earned 5 per cent in Singdollar terms, over the last 20 years it earned 5 per cent in Singdollar terms. So those are the facts, but that’s not returns gained from investing CPF monies. That’s returns gained from investing all government assets, including the unencumbered assets. It’s returns gained from investing in higher-risk portfolios for the long term. If it was just CPF monies, it will be a different portfolio and a different set of returns. Every serious financial professional knows that.
[The best part of this all? Roy doesn't understand any of it.]

Party like there's no tomorrow?

Jul 27, 2014

That's the surest way to a self-fulfilling outcome; better if people will the future

With flags going up on buildings, aeroplanes buzzing above our heads and streets being closed for parade rehearsals, it's that time of the year when we bring out the red-and-whites for National Day.

Many have also started to think about how to mark the big 5-0 next year, when the Republic celebrates five decades of independence.

Should Singapore party like there's no tomorrow in 2015, as suggested by Professor Kishore Mahbubani, dean of the Lee Kuan Yew School of Public Policy at the National University of Singapore, in a recent column in this newspaper?

He made the case for a year-long national jamboree this way:

"Why be happy for this one year? The reason is simple. We have had, by any standards, an extraordinarily successful first 50 years. The chances of us being equally successful over the next 50 years are practically zero.

"Since we have had a good run and are about to embark on a more difficult run, let us rest and celebrate before the hard slog. A mountaineering metaphor comes to mind. We have reached a good base camp. Before we climb to higher and more difficult altitudes, let us drink teh tarik and celebrate how far we have come."

No doubt, Prof Mahbubani is right not to underestimate the challenges we face, and to remind Singaporeans not to assume that the road ahead will necessarily be anything like what we have traversed so far.

But as I read his thoughtful column, it also made me pause to ponder: What if the pioneer generation of Singaporeans had taken a similar view? What if they too had looked ahead in 1965 and concluded that the chances of a better future were "practically zero"?

Mind you, this would have been an entirely rational conclusion at the time. Singapore faced a bleak future, with no resources, no hinterland, no defence, and no clear idea of how to make its way in the world after independence was thrust on it out of the blue.

Thank goodness they did not choose to sit back and party for a year or more, but hunkered down instead to the task of eking out a living and securing their future, against all odds. If they had done otherwise, we would not be contemplating how best to mark our 50th National Day.

So it seems to me that for Singaporeans today to look ahead with the notion that their best years are past them is the surest way to ensure a self-fulfilling prophecy.

Put another way, unless we believe in a brighter future and will it to happen, it simply will not.

To be fair to Prof Mahbubani, the flip side of this is also true, of course, and no less worrying. That would be for Singaporeans to look ahead and assume, rather complacently, that continued success is assured, almost our birth-right.

To turn an expression on its head, failure is not an option, and Singapore will prosper, simply because it has always done so.

Both scenarios - assuming that the future can't get any better, or can't possibly be worse - are equally flawed, and risky. They point to the critical importance of getting the national narrative right in the minds of people, both here and abroad, as these could shape our future prospects.

This might best be illustrated by way of a football metaphor. Consider the much lamented 2014 Brazilian World Cup football team.

Despite being the favourites to lift the prized golden trophy, they crashed spectacularly out of the tournament at the semi-finals, in one of the biggest shockers in soccer history.

Here was a team with great football pedigree. Their hopes were buoyed by success at the Confederations Cup the previous year. As hosts, they had homeground advantage, with millions cheering and willing them to victory. Having spent billions on some fine stadiums, the people were expecting a few weeks of dazzling football to culminate in the Cup being lifted by the home team for the first time on Brazilian soil. Failure, in other words, was not an option.

With their talismanic player Neymar injured and their respected captain Thiago Silva disqualified after the quarter-finals, the pressure mounted on the team. They knew they had to win, to give their people the prize they craved. Never mind whether the team had the skill, stamina and mental strength to get the job done.

We all know how this sad story ends. The team choked, and suffered a humiliating 7-1 drubbing by the well-oiled German juggernaut, in front of millions of stunned fans at home and abroad.

The same might be said of the star-studded Spanish team, the defending champions who were humbled 5-1 in their opening game, another result no one saw coming.

How does this apply to Singapore? Well, in some ways, the Republic bears a resemblance to those well-regarded teams. It has had a long run of success, with an enviable record of economic progress and good governance that even other governments talk about. People here and abroad have come to expect Singapore to keep going on and on with its lucky winning streak.

So it might be worth asking the awkward question: Is Singapore at risk of facing the political, economic or social equivalent of an unexpected 7-1 drubbing when we least expect it? How would the country react if this were to happen? Would it be shocked and split, thrashing about in defence, and bewildered as to how best to counter-attack?

No doubt, for many these questions will be uncomfortable, even odd. For the idea that Singapore might falter, flounder, and even fail seems fanciful, perhaps the work of overwrought imaginations or those given to political scaremongering.

Yet, if truth be told, this is a dangerous illusion that some experts have labelled "false certainty".

Of course, such false certainty applies equally to the idea that Singapore cannot fail or that the next 50 years are unlikely to be better than the last.

The best antidote to such misguided sureness, or smugness, about the future would be for Singaporeans to look squarely at their past, rather than sugar-coat it in celebratory fashion, assess their present strengths and weaknesses rationally and dispassionately, while also dreaming big about where they might take the country, provided they have the wit and will to make these plans a reality.

Next year's 50th anniversary is a good opportunity to do just that and many interesting events are being planned. But as I see it, simply partying as if there is no tomorrow is not the best way and instead, the focus of any celebrations should be to achieve three things:
  • Help people reflect on what it takes for Singapore to succeed, and how it can continue to have the collective courage, commitment and cohesion to keep alive that old dream of forging "one united people, regardless of race, language or religion, to build a democratic society, based on justice and equality''.
  • Provide a lasting legacy to show future generations how we got here. I have proposed previously the idea of creating a Jubilee Park, stretching from the steps of City Hall, across the Padang and all the way to the Esplanade by the Singapore River, with streets closed off to allow people to walk through monuments and markers of the scenes of so much of Singapore's shared history. 
  • Give people a sense of why and how they might keep up the effort to take Singapore even further, by not only showing the possibilities for better lives in the years to come but also inviting ideas from all on how best to do so.
In the end, the big jubilee jamboree would have been worth the bother if, when asked the questions - Zero chance of doing better than we have done? Or zero chance that we can do no worse? - Singaporeans will answer quite simply, but with quiet conviction: "We will the future."