Hello! Welcome back to the blog. After a long hiatus (I graduated!), I wanted to share an essay I wrote while in a Developmental Econ class during my undergrad. Without further ado, please enjoy the Singapore Success Story! Originally written 11/20/2020
You know where I’ve always wanted to go (ever since I became interested in it a few years ago)? Singapore. My wife lived there for a bit and it still lingers on in her loving memory as a place we may end up moving to after college - or at least to visit. While the closest I’ve ever been to the city state is the island republic of the Philippines, I’ve been fascinated by Singapore because of its incredible transformation from a swampy port town to a shining metropolis. I’ve never fully understood how they did it. In my head, I expected that Singapore’s success story is the same as our favorite American Dream, but on a national level - that through hard work, dedication, and withstanding the communist pressures of the Cold War, anyone can carve out a place for themselves on the world’s stage. As I dove in to research their transformation, I expected to see that they were uniquely equipped with some sort of rich economic history that helped them persevere through rough times of poverty and communism while the countries around them succumbed to the same threats and were held back economically until today. I expected that Singapore’s development could be attributed to two things: their economic history, and their governmental institutions.
For our first question, we need to look back at Singapore’s humble origins. During the 1800s, Singapore was briefly a port for the East India Company and was rivaled by Hong Kong. The French occupied it for a short while, but Singapore continued on under British rule. Their time under Britain, I believe, was the highlight of their economic history. Because Britain still had military installations there after World War II, Singapore was receiving somewhere in the neighborhood of $200 million per year in economic stimulus. Britain was holding on to Singapore in an effort to maintain their status as a world power. It seems that Singapore already had a pretty good foundation in capitalist Britain with years of seeing for themselves what the Invisible Hand could do for them.
This is when we get more into the effects of the Cold War. When Britain finally pulled out of Singapore, the jobs and livelihoods of many Singaporeans were threatened. It was time to find a new patron. While the USSR and America fought a proxy war in Vietnam, Singapore set itself up as a headquarters of sorts for American businesses who were hoping to perpetuate the American War Machine without the cost of overseas transport and shipping. In addition to their land’s close proximity to Vietnam, Singapore was able to offer goods and services in tin, rubber, and the refinement of petroleum. True to form, when asked to make a choice between the Americans and the Soviets, Singapore doubled down on their capitalist history and started making money. It would have been hard for the USSR to have swayed them to communism without conquering them outright.
Next, we need to look at Singapore’s institutions. According to Eugene Dili Liow (of the National University of Singapore), Singapore is what’s known as Neoliberal. Basically, this means that they put the market first, privatize state enterprises, and focus heavily on deregulating the market so as to promote a more free trade - moving away from Keynesian economics (the gov can and should push money around to stimulate the economy) and more towards Hayekian (hands off, gov! Let the market handle it). To me, this raises a question of ethics. As I discussed in my podcast (Eekonomics Podcast - “Government Regulations: Good or Evil?”), there needs to be some sort of regulation at all times. If the government doesn’t step in to regulate some aspects of the market, you’re going to have a wild west, street justice sort of society where anything - and I mean anything - can be bought and sold for the right price. An extreme example would be the supply and demand for hitmen. While there may certainly be a market for this, it is the definition of unethical. Whether or not a decision can improve one’s economy has no bearing on whether or not it should be done morally.
While we’re on the topic of questionable morals, let’s take a look at one of Singapore’s most beloved leaders, Lee Kuan Yew. We just can’t study their institutional history without Yew. In 2015, the nation mourned for the loss of their foremost founding father with the Economist on the scene to try and capture Yew’s legacy. In his own words, Yew said that Singapore itself was his legacy, and rightly so. He had seen it through its independence in 1965 and stayed in governmental power in one way or another from prime minister to senior advisory figure right up to 2011. Lee Kuan Yew was known for his pragmatism (if you’re like me you had to look that word up - it’s basically the very practical attitude that if something works, it must be right), his constant effort to do right by Singapore, and of course, his belief that he knew best for his country. Another notable trait of his was his flexibility; he was not afraid to abandon policies that just were not working, no matter how hard they had been pushed for in the past.
Some criticize Yew’s more authoritarian tendencies, and indeed he had a bit of a streak there. By his own admission, Yew locked up many of his political opponents without due process of law. He explained that these opponents of his were communist and were set on destroying Singapore’s democracy as they knew it. This once again raises the question of ethics in Singapore’s government, but in the spirit of pragmatism, we can see quite plainly that it ultimately proved to be in the best interest for the country. I may be wrong to draw a connection here, but while learning about Yew, I couldn’t help but think of the Marvel Cinematic Universe’s Thanos and his undying commitment to his goals and the greater good of the universe as a whole - no matter the personal cost or damage to his reputation. Yew had the strongest will to do what needed to be done and as he passed away in 2015, he was able to look over his grateful country, proud of the nation he had sculpted for his people.
I’m not afraid to admit that my expectations were a little off. It seems the economic history of Singapore was more a foundation on which Yew built a nation and not an anchor to which they clung while communism and capitalism fought around them. I expected to see Singapore march forward against all odds as a little island underdog, but instead I found them in the middle of the Vietnam War profiting off of American lives. I suppose I should have expected this in part. We’re all human here on this earth, and we all make questionable decisions. It was unrealistic of me to expect Singapore’s success was a perfect one when that has never been the case for any successful nation. That in mind, I believe I am ready to identify the main factors of Singapore’s success while other countries around them are still quite a ways off from the same standard of living. First, I identify their patrons. Britain’s unwillingness to let go of the little island kept Singapore’s pockets full, then American business moving in during the War helped fill the economic void Britain left when finally pulling out of Singapore. Second, I identify their fearless leader, Lee Kuan Yew. Yew did whatever it took to see his nation happy, safe, and successful. No other country in Southeast Asia had that combination backing them. Having learned all this about Singapore and Lee Kuan Yew, I’m already thinking of how other leaders have affected their countries and while I’m curious and eager to get started, that’s a topic for another essay.
Works Cited
History of Singapore - https://www.britannica.com/place/Singapore/Singapore-since-1990
Singapore and the Cold War - https://thediplomat.com/2017/03/lee-kuan-yews-singapore-bloomed-in-the-shadow-of-the-cold-war/
Yew Transformed Singapore - https://www.youtube.com/watch?v=PsPsMuaJOZg
Neoliberal-Developmental State - https://journals.sagepub.com/doi/pdf/10.1177/0896920511419900
Eekonomics Podcast - “Government Regulations: Good or Evil?” - https://open.spotify.com/episode/2BgvX3E5zZAKMsLUfjGZDx
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