What did Singapore have to do after 1965 to ensure its political and economic survival? How important was Asean to Singapore?
"Singapore, under the rule of the PAP, has made much progress in many fields…Every Singaporean knows that all these are the achievements of the people of Singapore under the leadership of PAP since 1959." Ong Teng Cheong made the above bold statement in the parliament in 1984 before the elections. By a large extent, he was historically correct. However, what did Singapore achieve to warrant such a statement? Was it achieved at the expense of other ideologies such as democracy?
On the other hand, while Singapore strives hard to avoid being the ‘third China’ in Southeast Asia, it is no mystery that there are antagonisms between Singapore and her neighbours. Can Singapore use ASEAN as a vehicle to promote regional co-operation and at the same time minimises her friction with her neighbours?
This paper will attempt to analyse how Singapore managed to solve its political and economic crisis when it was separated from Malaysia. Throughout the period of 1965-1985, Singapore leaders depended on three important ideologies to motivate its people and formulate its domestic and foreign policies vis-à-vis ASEAN. The paper also attempts to take one step further and examine, in an increasing affluent Singapore, the potential problems such ‘useful ideologies’ might give.
In the period immediately after separation on 9th August 1965, Singapore was gripped by uncertainty of survival. Tapping into this fear, PAP effectively adopted this into their main political ideology: national survival. This issue becomes an important rationale for internal and external policies. Three points underpin this survival ideology; firstly, a creation of a society that is flexible enough to accept new values, attitudes and perspectives, secondly, maximum mobilisation of a tightly organised society and finally, nation building.
Pragmatism flourishes in this arena of survival uncertainty. While it is pragmatic to advocate pragmatism, such decisions are often undemocratic in certain ways. The only ideological justification for such pragmatism is the need to survive. Nevertheless, the question remains: How far will an increasingly affluent Singapore accept the dishing out of pragmatic policies? Moreover, any lack of overt endorsement from the people (1984 elections) was seen as ‘freak’. As PAP views its policies as pragmatic, it is only natural that it should receive the fullest support. PAP’s reaction reveals its deep scepticism towards common people’s ability to make rational choices.
In the pursuit of survival, the government plays up the ethos of ‘rugged individualism’. Lee Kuan Yew acknowledges the importance of such a spirit in industrialisation. Meritocracy becomes the logical conclusion of the twin ideology of pragmatic and survival ideologies. Founding fathers such as Rajaratnam commented in 1985, that that without meritocracy, there is no other way to run a modern society. This unapologetic meritocratic explanation on inequality highlights the increasing discrepancies between the rich and the poor. Between 1959-1970s, a lion share of the nation’s per capital income fell to a small group of people, political, executive and commercial elites, whence real wages of workers only increased by 5%. Socialism, thus becomes a casualty in this pursue of excellence.
With the nation’s ideologies singled out, it becomes easier to understand the path Singapore took in the years between 1965-1985. PAP viewed the demise of a common market with Malaysia with dismay. Although the separation had promised co-operation in economic areas, Malaysia sought to protect their economy by bypassing Singapore’s ports and rising tariff walls. Dr Albert Winsemius, Singapore’s economic adviser described the PAP’s attitude, then as ‘beaten dogs’. Winsemius had as early as 1962 predicted the unfeasibility of the common market and had advised accordingly. He believed that the island could develop independently of the main land. The key was to go global.
The economic ambivalence was excruciated by Britain’s decision in January 1968 to pull out all her military presence from Singapore by spring 1971. In 1966, Britain had already produced a White paper proposing a gradual pull out in the 1970s, but the 1968 decision was top down based on Britain’s financial woes, without consultation with Singapore. On the balance sheet, Britain’s presence accounted for 20% of the young nation’s GNP and provided 25,000 jobs island wide. This orgy of 25,000 unemployed citizens might well constituted a political problem. The furious Lee Kuan Yew initially wanted to ‘disrupt British shipping, insurance and trade privileges’ in retaliation, but decided otherwise since only Singapore would suffer. Goh Keng Swee and Lee Kuan Yew flew to London and strongly presented their case against this unethical pullout. With the intervention of Confederation of British Industry and like commercial lobby groups, Singapore managed to get a soft loan of £50 million, a postponement of pullout to November 1971, obtain the naval docks free and retraining programmes for the unemployed.
To go global, a conducive industrial climate had to be created to attract business investment. Industrial peace must be restored and wages held down. PAP fanned the public fears of an impending economic crisis and shrewdly called for an early election in April 1968 to gain a new mandate for implementing tough measures in anticipation of unemployment problems. This election made history as PAP swept up all the 58 parliamentary seats and returned as a single party government. In August, the government passed the Employment and Industrial Relations (Amendment) Act. This piece of legislation single handily restored the manager’s right to manage. This proved to be important in Singapore’s new role as an export orientated economy. Although, the legislation was tough on employees, it also provided for increased employers’ contribution to employees’ CPF, first time sick leave and unemployment compensations. Consequently, there were no strikes in 1969.
With industrial peace at hand, the government set about shifting the economy from an import substitution policy to an outward-looking export-orientated policy of industrialisation. As there was no natural resource base from which exports might have been derived, opposition was non existent. It rejected nationalisation and welcomed MNCs into Singapore. There was, however, massive governmental participation in business through wholly owned and partially owned companies. Goh Keng Swee explained the government’s participation as a means to help and stimulate relevant industries, but more importantly, it served as a check against foreign control and ownership.
The Economic Development Board (EDB) was responsible for the successful wooing of foreign capital. Acting under the Ministry of Finance, it initiated projects and financed them by loans and equity participation. It had by then become not only a sales organisation selling Singapore for the promotion of industry, but acted as a catalyst for industrial organisations which after they had become large enough, could expand on their own. Foreign investors were attracted by the improved labour situations and by such incentives such as tax relief for up to five years and unrestricted repatriation of profits and capital in certain government favoured industries. United States firms flocked to invest in Singapore, accounting for 46 percent of new foreign capital invested in 1972. Companies from Western Europe, Japan, Hong Kong, Taiwan, Malaysia, and Australia also invested capital, and by 1972 one quarter of Singapore's manufacturing firms were either foreign-owned or joint-venture companies.
Just as luck would smile on those who helped themselves, Singapore’s industrialisation came in the midst of boom conditions contributed by escalation of Vietnam War and exploration of oil in Indonesia. Singapore became s supply centre for American forces and provided ship repairs. She capitalised on the former King George VI dock, turning it into Sembawang Shipyard and offered free registration for foreign ships and created a national shipping line, Neptune Orient Line. Another attraction of Singapore for foreign capital was the region's petroleum resources. Singapore was the natural base for dozens of exploration, engineering, diving, and other support companies for the petroleum industry in nearby Indonesia, as well as being the oil storage centre for the region. By the mid-1970s, Singapore was the third largest oil-refining centre in the world.
In the aftermath of the OPEC crisis, the government with its survival mentality congratulated itself for its farsighted wage policies. As early as 1972, the National Wage Council imposed artificially low wage increases for the next 5-6 years. Although Singapore’s manufacturing was badly hit, she managed to pull through partly due to the above measure and partly through the efforts of Housing Development Board which became the main employer of thousands of people, building cheap flats for her people and providing timely increase in public expenditure.
However, Singapore became aware that her neighbours such as Hong Kong, Taiwan and South Korea who had mechanised, was achieving a growth of 7%. This spurred Singapore to adopt high wage (20%), high skill policy that was a better long-term measure. It aimed at imposing a heavy cost penalty on labour component and forcing capital to be used for high-technology manufacturing. This ‘second industrial revolution’ improved productivity despite greater labour cost. Redundant overseas low skilled labour could be sent home.
The main casualty was mainly local small firms who had to move operations elsewhere. The MNCs were aided by the Skill Development Fund to help train workers. At the same time, EDB was active in providing industrial training through its Industrial Automation Training Unit and providing funds for its Research and Product Development Assistance Scheme.
As demonstrated in the financial crisis in Southeast Asia recently (1998), Singapore could not ill-afford to depend on foreign capital or short-term loads alone, as it had no natural resources to mortgage on. A more effective way to gain a cheap financing without inflation and cutting down social expenditure is certainly the Central Provident Fund (CPF). Introduced in 1955, it was enforced with the CPF Regulation on April 1972. Combining both contributions from the employers and employees, in 1983, Singaporeans contributed S$3,901.4 M. 75% of these were channelled into government bonds and the rest were placed as deposits with the Monetary Authority of Singapore. While economically it provided a cheap source of development funds, politically, by allowing citizens through legislation (1968) to purchase flats and Singapore Bus Services’ shares, the government increased the stakes citizens held in the country.
Thus, by mid-1970s PAP pragmatic strategy had succeeded in creating a suitable economic climate of necessary infrastructure services and financial facilities. It had also curbed the militant labour conditions. It was also quick responding to the changing fortunes of the world economy especially in the OPEC crisis. One will now turn to the political facet and see how the same ideologies applied.
PAP’s domination of the parliament was made possible by the inherent power structures. The British’s constitution vested strong powers in the parliament. It was by default that Singapore became a one-party system, since Barisan Sosialis voluntarily withdrew from parliamentary politics. In addition, PAP was generally cool towards the recommendations of the Constitutional Commission (1966). It threw out the suggestion of a referendum, postponed the appointment of an Ombudsman and turned the Presidential Council into a Presidential Council for Minority Rights. All these were possible because people were more concerned with survival than the intricacies of their constitutional rights.
Singapore’s early political arena resembled Darwinian theory of natural selection and evolution where only the strongest survived. In 1963, Operation Cold Store effectively deprived Barisan Socialis and the trade unions of its leaders and secured for PAP victory in the 1963 election. Instead of consolidating their limited position, it boycotted the Parliament (and again in November 1965), thus eliminating the only bases of legality it had. This was to be the first of a series of fatal strategic errors. In the aftermath of the separation fiasco, it failed to cash upon the failure of the merger and called the independence ‘phoney’. It alienated popular support when it called for the early pull out of the British military presence which was indirectly a source of employment for 25,000 people. Its ‘back to the streets’ strategy of mass political agitation was the biggest blunder made by Dr Lee Siow Choh as it failed to elicit a favourable mass response. Its quitting of parliamentary politics also enabled PAP to win all the 51 seats uncontested in 1968. The demise of Barisan Socialis also spelled the end of a viable opposition for nearly two decades.
In the industrial scene, PAP was largely successful. With most of the main trade union leaders (mostly Barisan Socialis) out of the way in 1963 and the New Trade Union Act of August 1966 which forbade strikes, any fire in trade union was doused by the Employment and Industrial Relations (Amendment) Act of 1968. The value of labour and the right to bargain openly and maximally is being radically undermined. Bargaining and protest are expressed through channelled access laid down by PAP.
PAP backed National Trade Union Congress (NTUC) advocated mutual trust and co-operation with employers and initiated breaking down of large unions, reducing their collective strengths. In addition, the role of NTUC was made redundant by the formation of National Wage Council. Wages became a national policy and this disillusion was reflected in the falling union membership in1968, 1969 and 1970. NTUC hastened to enter the world of co-operatives, insurance and business to attract new members. Nevertheless, there was a reversal in the low recruitment trend because the workers realised that this unsatisfactory choice was the only bulwark against the exploitative labour market. Against foreign criticism, PAP was to again use the ideology of pragmatism and rebutted that most critics were concerned with principle without acknowledging the actual material gained by the workers as the result of economic growth.
PAP was initially left with hardly any grassroots support when Lim Chin Siong split from PAP. He brought away with him an exodus of supporters (August,1961). Learning from its mistakes, PAP was determined not to repeat that. Community Centres was used ‘to resist and overcome the communalistic policies of the various opposition parties, notably the Barisan Sosialis.’ Thus, it became powerful channels for mass mobilisation. PAP cleaned the stables by reorganising Community Centres under the People’s Association. Citizens’ Consultative Committees are also set up in every electoral constituency. Although, touted as political participation at grassroots level, transmissions were always from top down and it was treated as functionaries of the political structure.
PAP’s stance is adamantly harsh on any vestige of racial chauvinism, understandably so as the country’ national identity and survival is based on a multiracial, multilingual secular society. This national policy means that socially, racial cultural practices were pushed to voluntary bodies and politically, racial question is pushed out of the front-line. Universal recognition is given to racial tolerance, but any racial differences are restricted to festivals. Political questions that are interpreted as benefiting any specific racial groups is immediately seen as chauvinism and subjected to Internal Security Act.
For example, in October 1965, the Chinese Chamber sought a constitutional guarantee of the status of the Chinese language as one of the official languages in the state. Lee Kuan Yew reacted swiftly by calling a meeting for the members of the various racial chambers of commerce and firmly admonished them not to raise the language issue in politics.On the other hand, when Malay leaders suggested in 1970s for Malay language as a compulsory subject, Lee Kuan Yew rebuked them, "If any government is mad enough to accept this proposal, it can only provoke the Chinese-educated to hostility."
On a firmer note, on 2nd May 1971 Nayang Siang Pau’s four editors were arrested on charges of fanning Chinese chauvinism. Eastern Sun was closed when it was accused by the government to be a front for the communists. Next in line of fire was Singapore Herald, guilty of causing disruption and destabilising the country. Political pressure was put on her bankers to withdraw funds for the already liquidity troubled press. In one year alone, PAP through the closure of three newspapers showed that they alone have the right to shape consensus among different racial groups. In 1974, the government strengthened press control through Newspaper and Printing Presses Act. This coercion was so effective that hardly any murmur of discontent was uttered when Nanyang University’s medium of instruction was changed to English in 1975.
In the 1960s, by using the Suitability Certificate (1964) the government managed to control the Chinese-educated students of Nanyang University and Nee Ann College. Hence, PAP had to swallow a bitter pill when Tan Wah Piow, President of the University of Singapore’s Student Union, staged a protest against the deportation of Malaysia and Hong Kong students (1974). Dissent coming from the corner who had every thing working for them shocked PAP into changing the constitution of the Students’ Union.
These actions against the newspapers and a English educated student leader persuaded the younger generation that political involvement and discussion might jeopardise their careers as the government had a monopoly on power and opportunity in a small state and the party could easily co-opt the willing and suppress dissenters. The adverse effect was the general indifference towards ideological politics and the genuine desire to accumulate wealth and material comfort. However, the people will register their protest against any encroachment into their chances of upward mobility and this was amply demonstrated in the 1984 elections.
Events leading up to the election of 1984 could be summarised by a comment by a Minister, "We just can’t always be telling them to compare their situation to that of the 50s and ask them to be grateful." PAP’s monopoly ended when J. B. Jeyaretnam of Workers’ Party won Anson through by-elections in October 31, 1981. PAP thought that it would be an easy fight and put a nonentity, Pang Kim Hin as candidate. Secondly, Pang did not relied on Anson’s grassroots leaders for his campaign and lastly, residents of Blair flats were not given priority for HDB flats when their flats had to make way for a new container complex for PSA. Thus, the residents of Anson cast their votes with a vengeance.
The significance of the ’84 election was that it broke a number of new grounds. It was the first election run by successor generation and had around 215,000 new voters. It also violated PAP’s rule of one-year moratorium on unpopular policies. Experienced old guard was shoved into retirement. Equally damaging was the threat that opposition wards might suffer cuts in benefits. Such bureaucratic arrogance was not suffered gladly by the people.
The opposition finally hit upon a responsive chord in their campaigns after so many years: the government was arrogant, elitist and unfeeling. PAP again lost Anson and lost a second seat, Potong Pasir to Chiam See Tong (Singapore Democratic Party). The most painful fact was that popular vote went down by 12.6%. In face of pragmatic policies, Singaporeans responded with a conclusive ‘no’. It was a protest against ‘PAP’s government’s trespassing beyond the invisible but real line between the citizen’s own prerogatives and his own definition of national interests.’
Paradoxically, the new generation of electorates wanted ‘to have their cake and eat it’. Although, for PAP to remain in power is mandatory they also wanted opposition to check on the government. Their response was a logical conclusion of a better educated, less compliant (possibly being English educated), economically secure and intrigued by the Western liberalism. While the earlier leaders had faced the problems of radical left wing unions and economic problems and proven their mettle, the new leaders had not obtained such mandate. This ‘fairly homogeneous bunch’ inherited an electorate that questioned their credibility. It was to the credit of PAP that it quickly reacted with a consultative form of government. Although the electorate responded with cynicism, after all it had been subjected to years of little say in public policies, PAP must realise that consultation process cut both ways. It meant that this process could no longer be withdrew without sound justification.
Singapore’s pragmatic ideology also plays an important role in its formulation of her foreign policy vis-à-vis ASEAN. Singapore seeks develop ties that would enhance regional trade. It believes that the only way a small country could have a fighting chance for survival is for it to develop economically. Prophetically, Singapore held the view that the economic stagnation and collapse within the region would threaten ASEAN’s survival. In the Bali meeting (February 1976), this economic view was acceptable by the rest of the countries and it was hoped that ASEAN would be able to project a united front to negotiate with developed countries.
Although there were some success in terms of tourism projects such as "Visit ASEAN Lands", differences in national growth such as infrastructure and technology impede any further realisation. Trade with foreign powers continues to outgrow internal regional trade, as there is a need for foreign capital and technology. Moreover, Singapore’s rapid economic development led the other countries in ASEAN to look upon Singapore with irritation as her wealth was a source of ‘political embarrassment in the region.’. Indonesia and Malaysia sought to divert their dependence on Singapore’s ports. To make matters worse, Singapore abrasive leaders tend to give unsolicited advice vis-à-vis economic matters.
Nevertheless, ASEAN’s co-operation as a negotiation bloc with developed countries is a success. American treats ASEAN under Generalised System of Preferences agreement, despite the fact that Singapore’s economic wealth disqualified her from the concession. Another example could be seemed from how ASEAN confronted Australia over discriminatory policy against ASEAN airlines, especially Singapore Airlines. Australia had to bow down to united ASEAN pressure. Consequently, ASEAN’s presence does benefit Singapore’s economic progress.
From the onset, Singapore wanted ASEAN to pursue a foreign policy of non-alignment and national ideology of countries should not be held accountable for refusal into ASEAN’s membership. This stance was displayed by Singapore’s refusal to join ASPAC, an anti-Communist alliance. Singapore’s reluctance to let political and security matters dominate ASEAN, as she fears a powerful foreign neighbour (USSR) would dominate its agenda. Singapore insists that internal political stability is best dealt internally and Southeast Asia’s regional stability should be the role of major powers concerned and ASEAN should not take sides.
But due to a decade of diplomacy in ASEAN’s framework and its effectiveness in resolving regional disputes, for example; Malaysia and Philippines resumed diplomatic ties and in 1973, Lee Kuan Yew paid respect to the two executed Indonesian marines, a certain sense of cohesion was achieved. Following communist’s victory in Indo-China; members in ASEAN decided to sign a Treaty OF Amity and Co-operation to enable them formulate a system to deal with regional conflicts. Although, ASEAN has turned into a political organisation, it is one aimed at stability of the region and this boosted foreign investments in the region.
Realism imbues Singapore’s perception of international politics. The nature of conflicts might change to that of economic, political and intelligence activities, but super powers would continue to seek for control in this non-alignment lake. Tun Abdul Razak might picture ASEAN ‘to be a zone of peace, freedom and neutrality’, but Singapore preferred the assurances of an American presence. When Vietnam invaded Cambodia and Soviet was interested in Cam Ranh Bay, Singapore was insistent that America honoured her Manila Pact and the Khonam-Rusk agreement of 1962. So long as conditions in Southeast Asia was unfavourable, Singapore desired a continuing American military presence.
Singapore’s leadership in denouncing Vietnam’s invasion brought Singapore international prominence despite its size. Singapore perceives ASEAN as a body that it can actively participate in international affairs. She also envisions ASEAN as a co-ordinating body for Asia foreign affairs. However, Indonesia and Malaysia saw the long-term threat from China and not Soviet and both countries in a Kuantan meeting in May 1980, preferred accommodation with Vietnam. They believed that Vietnam should be left to deal with her neighbours herself so long as it did not threaten Thailand. Therefore, there might be some disagreement over certain details, but Singapore aims at nudging ASEAN towards areas of ‘closer regional security and co-operation’ especially one, which is in line with Singapore’s national interest.
In conclusion, pragmatism has served Singapore well in terms of economic progress and in battering pro-Communist influence, but problems could be detected from the result of the 1984 elections. Such problems, such as the desire from a generally affluent society wanting an increasingly louder voice in the making of government policies, paradoxically arise from the success of Singapore’s economic policies. Timely gradual change by second generation leaders seemed to be working, but influence of western liberalism on younger votes dies hard and the presence of opposition parties in parliament can well be a permanent fixture in domestic politics.
The importance of ASEAN to Singapore is without doubt. Whether it is in terms of economic bargaining power with the developed countries or bigger role in international politics, Singapore stands to gain. Lee Kuan Yew’s wise decision in being the last ASEAN country to have diplomatic relationship with China reflects the future nature of Singapore’s foreign policy. Any actions taken by Singapore must be sensitive to the feelings of her neighbours.
Perhaps what Singaporeans can expect of the future can be summarised by a speech given by Lee Kuan Yew, "What we have achieved is not enough to see us through the next 30 years. That we have succeeded in the last 31 years is proof that we had the capability to adjust to the changing circumstances of that period."
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