Yet another instance of ignorance about our own history from our political leaders, this time from Lawrence Wong. “If you look at our history in Singapore, we have never failed in restructuring our economy before,” he says (http://www.straitstimes.com/…/major-infrastructure-projects…).
Singapore’s “Second Industrial Revolution”, which lasted from 1979-1985, attempted to restructure our economy, moving away from reliance on cheap labour and competition with other low-wage economies to a higher technological level of production.
The PAP legislated mandatory wage increases, provided incentives for high technology industrial capital, and intensified its control over labour.
The PAP soon learned it could not unilaterally alter the terms of its alliance with foreign capital. Foreign capital investment declined by 40%, demand plunged, and GDP growth fell by 10% from 1984 to 1985 (into a recession). The PAP abandoned attempts to improve productivity and our technological level of production, and fell back to low cost wage labour.
It would be more accurate to say that the PAP has failed far more times at restructuring Singapore’s economy than it has succeeded. I worry that the ignorance that our politicians display about our history is having a real and very negative impact on their policy making.