A FUNDAMENTAL QUESTION—CAN GOVERNMENT WORK?
AND WHAT TYPE WORKS BEST?
SINGAPORE’S LEE KWAN YEW IS DEAD
The nation, reflected the man: efficient, unsentimental, incorrupt, inventive, forward-looking and pragmatic.
“We are ideology-free,” Mr. Lee said in an interview with The New York Times in 2007, stating what had become, in effect, Singapore’s ideology. “Does it work? If it works, let’s try it. If it’s fine, let’s continue it. If it doesn’t work, toss it out, try another one.”
His leadership was sometimes criticized for suppressing freedom, but the formula succeeded. Singapore became an international business and financial center admired for its efficiency and low level of corruption.
One of the widely touted lessons of the Soviet Economy is that a centrally planned economy cannot work—and that, therefore, unfettered capitalism has to be the best solution. This argument is extended by quoting a whole string of economies—from the Asian tigers to sundry former Soviet clients which have prospered—and are continuing to boom—under American-style capitalism.
This view is widely believed in the U.S. where anything that smacks of central planning is eschewed. It just doesn’t happen to be true. In fact it is a serious distortion of the reality and mainly serves as validation for egregious corporate power and the current American Business Model—which notably fails to deliver adequate economic benefits to most Americans.
A few ultra-rich do extraordinarily well. A significant minority—who are politically active—do well enough not want the status quo to change (partly because they don’t know any better). The majority struggle. The Middle Class shrinks. Economic insecurity and fear are widespread.
The track record—now proven over a wide range of economies of all sizes and nationalities (and over considerable time) is that a centrally planned mixed economy works best—by far. This is especially true if the basic needs of people such as healthcare, housing, education, an adequate pension system, and a social safety net are factored in. In short, you need a centrally planned, socially just, mixed economy where execution is largely de-centralized—and mainly carried out by the private sector.
It also needs to be pragmatic not ideological. The main criterion about an initiative should be solely: Does it work?
It is widely argued in the U.S. that such social ‘nannying’ of people reduces the willingness to work, innovation, and the entrepreneurial spirit.
The evidence is virtually all to the contrary. Entrepreneurship, for instance, in the highly risky U.S. economy is actually in decline.
I am prompted to write about this by the recent death of Lee Kwan Yew at 91. His achievements in transforming Singapore were just plain remarkable—and his influence has been worldwide.
Was he a democrat? Not by American standards—but then neither is the U.S. right now. We retain the trappings of a democracy but we are functionally a plutocracy that doesn’t deliver the kind of economy that most Americans need.
We need to think about all this a great deal more than we do. The evidence and the answers are out there—and they are best not viewed through a veil of ideology.
VOR words 511.