Last week Singapore's founding leader Lee Kuan Yew passed away.
In the same week across the world, Brazilian private equity firm 3G made a $49b or twice the GDP of Uganda, for foods giant Kraft Foods Group. About the bid later.
Yew's place in history was long been cemented with his stewardship of a small city nation that went from third world to first in one generation. The journey is well documented in his book "the Singapore story" arguably a template for how under developed country's should go about their own development processes.
Of course the context of the time meant Yew could do somethings it would probably be hard to do now among them his crackdown on communist parties, which would now be read as harassment of the opposition, but he grappled with security threats, abject poverty, disease and ignorance like all his contemporaries.
What probably gave the whole project a chance was the vision he had his contemporaries had to see Singapore attain per capita GDP equivalent to that in the UK. They then went about reverse engineering the results and voila, half a century later Singapore is the envy of the third world and has been accepted at the high table of the first world.
It wouldn't be a big deal had the dozens of third world countries especially on our continent made a similar leap -- especially since Singapore was worse off than, say Uganda, when Yew started his mission in 1965.
"There really are no excuses for why Singapore is where it is and where we are now....
People argue that Singapore is strategically located in key shipping channel, but that was the case even before Yew came along. People argue that Singapore did not have to grapple with security threats and instability as we did but they had to live with the real threat of being swallowed up by Malaysia from whom they had broken away from. Diplomatic finesses coupled with political pragmatism averted that event but committed a lot of resources which would otherwise be used to push development. People even argue that the Cold War and the decision to align with the free market made the difference but a study of the development of Singapore shows they used what they could from both sides of the ideological divide to achieve what they did.
Yew was not a saint -- no politician is, but his leadership in helping raise the standard of living of his people cannot be taken away from him. However his example means there is no excuse for leaders anywhere in the world not to lift their populations out of poverty.
Which brings us back to the multi-billion dollar bid for Kraft foods.
This bid audacious in its execution is more noteworthy, in my mind in what it says about the US development experiment.
Unlike Singapore, which had a somewhat centralized planning system, the US has developed over the last two centuries not by design but organically, the people going about making it happen by responding to the circumstances as they arose.
Given what the US has achieved it comes as a surprise that they do not have a planning ministry, neither have they dabbled in five-, ten- or even 100-year development plans along the way.
So how did they pull this off, without everyone pulling in different directions and making the whole experiment collapse on itself in a mess of civil war, competing political egos and general chaos?
Political gridlock is not unusual in Washington and people who work with the system are often frustrated at how long things take to get done, however when things are agreed they often stay that way or don't divert much from the mean because wide agreement has been attained, assuring business a level of predictability that can not be enjoyed in many places around the world.
Maybe the US development process is the best case of Adam Smith's invisible hand, that individuals working in their self interest advance the well being of the society in general.
"The one thing that is clear in both development models, is the identification of a vision to aim at. On one hand championed by determined individuals while on the other driven by societal consensus...
The danger with the former is that once the individuals move aside can the momentum be sustained? While the US biggest contradiction is that their development process, which suggest widespread agreement, has the highest wealth inequalities in the developed world, meaning more and more people are being left behind.
The suggestion is that big business and other powerful interests have gamed the system to ensure the rich get richer and the poor get poorer, a possible cause for future implosion. Who knows ?
No comments:
Post a Comment