The Inauthentic Sampan

By Aloysius Chia

What is it about a recent comment by PM Lee, relating Singapore to a ‘Sampan 2.0’, that makes it so baffling, and frustrating?

Could it be the poor analogy. Nobody really thinks Singapore as a primitive ‘Sampan’ anymore, with its kind of diversified economy.

Or could it be that suggestion that the boat has been upgraded to ‘2.0’, keeping it the same while changing all its features?

Or could it simply be the unrealistic characterization that everyone is on the same boat?

The same sampan that everyone is presumably on has seen an explosion in income divide that makes the analogy, frankly, quite laughable.

Recent articles, both by The Straits Times (26 October 2013 Saturday Section) and by prominent bloggers, has made stark this issue. Here, the income difference is as disparate between the middle class and the rich, as between the rich and the poor, all visible in data from the department of statistics (Singstats).

From 2009-2012, real incomes including CPF for each household (adjusted for inflation using 2009 prices) in the bottom tenth percentile saw their incomes increase by 6.8%, while those in the top tenth saw their incomes increase by 17.3%.

But if you compare this to the period 2000-2012, those in the top tenth saw their income increase by 47.6%, while those at the bottom tenth percentile decreased by 7.9%.

It is easy to see then the number of people who are left behind in the last decade, given the number of Singaporeans living in HDB 3-room flats or smaller has ranged from 23 to 30% in this period.

For the middle class (fiftieth percentile), their incomes rose by 11.4% during the period between 2009-2012; while rising 33.2% in the period from 2000-2012. Thus, even as the lowest income group gets left behind by the rest, the highest pulls away from the middle as well (33.2% vs. 47.6%).

This is all the more so considering that for every 1% increase for someone earning $2000 a month, it is $20, but for someone earning $20000 a month, it is $200. Each percent increase is ten times more for someone earning $20000 per month than for someone earning $2000 per month. What more to say when the lowest incomes actually went into negative territory.

Certainly, government assistance should be considered. Data for this has not been specific in the amounts. But from the source that I used, on a per household member basis, including government transfers would reduce the difference between the top and bottom percentile by 1.3 times, from 9.2 times without transfers to 7.9 times, in 2012.

But this is only a marginal increase in help from 2009, where the difference was reduced by 1.25 times, and from 2001, where it was reduced 0.9 times.

However the overall difference between the top tenth percentile and bottom percentile, the rich and the poor (including government transfers) actually increased between year 2000-2012, from 7.7 to 7.9 times. Thus, it would seem that the government transfers have not effectively reduced the income gap.

To use such an example as a Sampan is missing the fact that not everyone is perhaps on the same boat, or even in it. The unity of a singular boat betrays the fact that behind this fluffy scene of a consensus there is a different sea altogether.

To constantly emphasize and portray it as if there is complete agreement about how the future should be like, is to leave out the fact that there are many others who have a different take on it. In other words, it reflects how our leaders are, lamentably, out of touch.

If, understandably, there is a need to reply to a question, putting it in a more sensitive light would assuage concerns that at least this issue is in the minds of those in power. Unfortunately, it is sometimes questionable whether this interest of growing disparities is even there at all, and that the concerns of ordinary folk are taken into consideration.

The little blurb is just a reflection of a larger sentiment.

Perhaps a better analogy to put forward would be to compare Singapore to a ‘Titanic’, where the decks are aligned so as to reflect the different classes, and those who to get to escape, in an event of a disaster, are those who are able to pay first.

Statistical Sources: Key Income Household Trends 2012 (Singstats); Singstats website (for CPI)

Actual Figures: Real household income including CPF from 2000-2012 by percentile

Note:

• I use Household income including CPF, because it is a better gauge of households that have individuals dependent on one other, than using figures on a per employed person basis. This despite the fact that not everyone may be working in households with at least 1 employed persons.
• I include CPF as income because even though CPF money cannot technically be used for discretionary spending, it can be used as investments and very limited schemes, like the purchase of public housing and equities. Also, it should be considered as money earned because the income that cannot be immediately used still belongs to those who earn it.