WORLDWIDE WEB: STENGTHENING THE SINGAPORE NETWORK

In discussing the role of civil society in Singapore, we need first to look at the way the world is going for we do not exist in isolation. We are not an island. The world is going through a major transformation brought about by the revolution in information technology. The current Asian crisis, which is both economic and political, is part of it. Old structures are being undermined, while new structures have yet to crystallise. The transition is an exciting one, full of hopes, but also full of dangers. It may well extend many decades and will certainly define the first half of the next century.

We are moving from a hierarchical world to a web world. The dissolution of old hierarchies is taking place not only internationally but also domestically within each country. International trade and the global economy are important aspects of this web world.

The power of the state is weakening, especially the power of large states. Take an area like telecommunications. In the old days, local telephony and international telephony were provided by monopolies and cartels. Today, there is increasingly free competition. With satellite handphones, no government will be able to maintain its monopoly position. Even hotels which exploit their local monopoly position to levy hefty charges on telephone calls will be bypassed. The implications are far-reaching. One day even the Chinese government will not be able to control the evolution of the Chinese Internet.

Or take the growth of electronic commerce. Many of us are familiar with the cyber-bookshop Amazon.com. We are now able to bypass local book distributors by buying books on the Internet. On Amazon.com, one can buy books weeks before they appear in our local bookshops. But it is not only bookshops and book distributors who are bypassed; tax authorities are also bypassed because it is difficult to collect GST on small items which are brought in by parcel post. As electronic commerce grows, the ability of national authorities to levy taxes will be severely weakened. Capital and human talent are mobile as never before. Thus governments are forced to compete with each other in the level of direct and indirect taxes they levy because individuals and corporations will have more and more ways to bypass national authorities. Government authorities which try to tax their citizens worldwide like the US Government run the risk of wealthy individuals giving up their citizenships for other citizenships which impose lower levies. For all multinational corporations, international tax planning is a key corporate function.

In the financial industry, the bypassing of old hierarchies is called disintermediation. Disintermediation now applies not only to financial institutions but also to other economic structures, and to social and political structures as well. Monopoly positions are harder and harder to maintain. The ultimate monopoly being weakened is the state. It is said that the essence of the state is its monopoly of legitimate violence against those who live within its jurisdiction. This applies not only to criminals. It applies also to those who do not pay their taxes and to those who want their children educated in a different way. With the global market creeping into more and more areas of society, this monopoly power of the state becomes weaker. Either the state conforms to the market or the market will find ways to defeat the state. However, the state will not disappear. It will remain important but will be forced to compete internationally for financial and human resources.

An obvious example is the current financial crisis in Asia. Governments which were able for a long time to redirect investment and redistribute income have lost much of their power. To use jargon which has recently become fashionable, the market exposes and punishes crony capitalism. Of course, this is a process which has been ongoing for some time now. The welfare state is in crisis throughout the world, whether the Fabian-Keynesian model or the communist-socialist one. It was market disintermediation which led to the collapse of the Soviet Union and which forced China to integrate into the world economy. Affirmative economic action all over the world is called into question because of the distortion it causes to the market.

The collapse of the Soviet Union and its aftermath give us an idea of what happens when the hierarchical world becomes a web world. The Russian government today collects far less revenue than its predecessor. Some say it is less than 10% of GNP. No one is quite sure. Local authorities have become much more powerful in Russia. Legally possessing weapons, the army, the KGB and the police have become semi-autonomous power centres. Mafia groups have become rampant behaving like small governments. Life goes on. Moscow and St Petersburg today have become much livelier compared to the old days, but Russia has become a messier world.

Disintermediation will cause the whole world to become messier. The weakening of the state has not been fully counterbalanced, by a strengthening of regional and international institutions, most of which, like the IMF, were created in response to the challenges of earlier age. Below the level of the state, city-regions and cities have become more powerful. MNCs today are, in some ways, jurisdictions unto themselves. If they are domiciled in a particular country or listed in a particular stock market, it is not by force but by choice.

In the same way, civil organisations in each country will become stronger as the state loses some of its monopoly power. It becomes easier for them to find alternative sources of finance and create forge their own international connections. Their members are freer to travel and to meet their counterparts in international conferences. Thus, in all countries, including China and India, non-government organisations have proliferated. However, there is also a darker side to this phenomenon. Criminals, terrorists and paedophiles are also able to network in the same way.

What is the implication of all this on Singapore and on state-society relations in Singapore? In the coming decades, Singapore’s status as a city-state will probably be a great advantage to us. Compared to cities in big countries, we have greater powers of self-determination. This enables us to have our own laws and to keep out the slums. Without this ability, we will be hard put to solve urban problems like housing, traffic congestion, crime, education, health care and so on. The politics of a city-state are also much simpler. We do not have farmers and agricultural lobbies to worry about. Singaporeans know instinctively that the business of Singapore is business. If we do not work, we do not eat. If we are not competitive in the global market, we will die. Thus Singaporeans know we cannot take too many liberties with ourselves. Without this common focus, the PAP government could not have remained dominant for so long.

Last week, I met a group of senior journalists from India. They were full of praise for us. When I replied that Singapore is easier to manage because we are a small country, their reply was that being a small country is a great advantage. Their remark is worth pondering over. In the old days, Indians were proud that India was a big country. Today, they face the frustration of not being able to break out from India’s multiple hierarchies. This makes it difficult for India to adjust to new opportunities. Singapore, in contrast, can turn on a 5-cent coin.

Singapore would certainly be poorer off if it were a part of India, as we were from 1819-1867 under the British East India Company. Equally, Singapore today would not be better off if we were part of Malaysia, Indonesia or China. There was a time when an earlier generation of leaders believed felt passionately that Singapore could not survive on its own, which was why the PAP then fought for merger with Malaysia. The world has completely changed. Technology has changed in our favour and we are lucky to be in the position that we are in. To be sure, the pendulum of history may well swing the other way a hundred years from now on, but that would be a different story. In the meantime, we have become a web cluster in the worldwide web.

As for state-society relations in Singapore, it is also going through a major transformation. In the old paradigm, the state was hard while society was soft. In the web world, the state and society exist in parallel. The organisation of Singapore is becoming less hierarchical. In the public sector, we have reduced the core giving more flexibility to the rest. Government departments have been corporatised. Statutory boards have been privatised. Government-linked corporations have become more market-driven, increasingly operating outside the country. Even Government ministries have become autonomous agencies, each managing and optimising its own budget.

This phenomenon of decentralisation, which is a response to new necessities, extends across all of Singapore. In Parliament, the introduction of Nominated MPs has brought new life to the House and a greater diversity in political debates. Local governments have assumed greater responsibilities. Town Councils now play an important role in our lives. The nine Community Development Councils are working as government-sponsored civic organisations. We have progressively widened the circle of participation in local government.

Many government committees have become civic committees, like those involved in keeping Singapore clean and green, discouraging smoking, promoting healthy lifestyle and the speaking of Mandarin. This trend will continue. Singaporeans with the ability and desire to contribute are called to serve in one way or another. In some cases, the problem is of the same individuals being called to serve in too many areas, but that is not a bad sign. On the whole, we now have a diverse range of Singaporeans volunteering and they have steered many of these committees in new directions. I hope even more will come forward to lead.

Civil society is also flourishing in other sectors. The number of civic organisations based on religious beliefs have increased. Many are involved in running community hospitals, hospices, halfway houses and other welfare facilities. Those which receive direct or indirect government assistance are required to serve all Singaporeans, regardless of race, language or religion. Most are happy to do so.

Civic organisations based on ethnic affiliation and particular social causes have become more active. Clan associations are rejuvenating themselves with varying success. MENDAKI, SINDA, CDAC, the Eurasian Association and AMP have become important self-help groups. AWARE, the Roundtable and Sintercom encourage us to be more socially conscious. In the past, such organizations tended to be politically motivated sometimes causing them to clash with the state. In fact, some of them directed Singaporeans to their ancestral homelands and had to be restrained. Today, they operate within the bounds of the state and increasingly with a common Singapore starting-point. This does not make us monolithic. Singapore is a heterogeneous society and differences of opinion are natural. As our common consciousness grows, the bounds of debate will be relaxed but, realistically, we will always need an outer perimeter to hold our society together.

For example, our universities, polytechnics and schools have become livelier and more diverse. Alumni networks have strengthened considerably. Fund-raising has become a part of our lives. Ever so often, we are asked to sing, dance or eat for a good cause.

In the cultural field, we have also achieved some success. We now have a good range of art and heritage groups. They make a big contribution to our social and cultural life. Take, for example, the recent Singapore International Film Festival. It was the most successful ever and we are well on our way to becoming the Asian Film Festival centre. The Film Festival was not started by any government agency. It was conceived by a group of private individuals. It was only after the Festival showed promise that government agencies like EDB, NAC and STB gave their support. Recently, we established a Film Commission, consisting of members from the private sector, to promote the film industry, both Singapore as a movie hub and also the production of local films. Singaporeans are the world’s greatest moviegoers. I thought that as a result of the economic downturn, our cinemas would also suffer a drop in attendance. But the contrary happened. Cinema attendance went up, probably because it is a cheap form of entertainment. One other aspect of the Film Festival is also worth remembering. If we did not relax censorship and introduce film classification, the Film Festival would not have taken off. By a judicious pruning of the banyan tree, we have enabled a new plant to grow.

National service has also become a part of our civil society. Most SAFRA activities are now organised by national servicemen themselves. Singaporeans have become quite good at organising big events because of the training they receive in National Service. A point here is worth remembering. National Service can only work if Singaporeans themselves believe in it and are possessed of a voluntary spirit. Without that spirit of sacrifice, national service will break down, however draconian our laws are. If Singaporeans do not wish to fight for Singapore, they will be AWOL in a crisis and there is little the SAF can do about it. National Service is perhaps the most important expression of state-society relations. A state lacking self-confidence will never arm its own citizenry.

What we are now seeing is a new mutually reinforcing relationship between the state and society. While the Singapore state supports the growth of civic organisations, the state has not got total control over them. In fact, the state increasingly relies on them to do the things which government by itself is not good at doing. If the government asks a smoker to give up smoking, he may resent it. If his peers discourage him, it is a different matter. However, we do need more bottom-up initiative to achieve a better balance between state and society. Without top-down direction, many civic organisations are plagued by internal disputes. There are deep cultural reasons for this. The separation of powers is not a tradition in Asian society. Without central leadership, many Asian societies do not hold together naturally. Singapore society is half-Asian and half-Western. We have to strike our own balance.

Of course, old instincts sometimes die hard. Without top-down direction, many civic organisations are plagued by internal disputes. There are deep cultural reasons for this. The separation of powers is not a tradition in Asian society. Without central leadership, many Asian societies do not hold together naturally. Singapore society is half-Asian and half-Western. We have to strike our own balance. For example, some civic organisations have experienced difficulty in getting the requisite governmental approvals to do things. This is partly because united front activities in the past politicised many civic organisations, causing them to come under security scrutiny. This problem is much less now but we have to be watchful nonetheless. The more we share a common Singapore consciousness, the more civic society can flourish in a way which strengthens the state.

In the coming years, it is good state-society relationship which will enable Singapore to compete and survive in the web world. In a messier world, with multiple and overlapping jurisdictions, trust will become a very important quality. When larger systems break down, it is internal networks of trust which will enable trade to carry on and economic life to continue. In the web world, trust networks enjoy a high premium. The Singapore label today enjoys a high premium because others trust us. In a crisis, there is a flight to quality and a flight to trusted networks and jurisdictions. Our strength as a financial centre rests completely upon this intangible quality of trust, trust in the impartiality of our courts, trust in the fairness of our regulations and trust in the professionalism of our officers. This trust is reposed not only in the Singapore government but also in Singapore banks and companies. Indeed, this trust extends to Singaporeans as individuals. And also to foreign companies which are based in Singapore and individuals who are our friends and partners. For example, a listing on the Singapore Stock Exchange is highly desirable for many Mainland Chinese companies because it is a stamp of good housekeeping, thereby enabling such companies to raise capital at lower cost in the international financial market.

State-society relations in Singapore must achieve two things. First, it must reinforce the reputation of the Singapore label. The label is not something superficial. The label reflects the positive elements which Singapore represents. If our passport or banknotes were worthless, others would not try to fake them.

Second, our state-society relations should expand and extend the Singapore network into the region and beyond. Every civic organisation has its own international connections. Each maintains its own network of friends in the world. Collectively, the networks maintained by our private sector organisations, both economic and non-economic, are much larger than the formal networks maintained by the government through its various agencies. In every city around the world, we should promote the same state-society relations among Singaporeans and extend this network to our friends in that city.

Two weeks ago, when I was in Beijing to attend a conference, I caught a bad flu and thought I should see a doctor. But I did not know whom to consult. It chanced that the manager of the Shangri-la Beijing Hotel was a Singaporean and a good friend of our ambassador. He recommended a doctor in the hotel. The doctor prescribed me both western and Chinese medicines, none of which I was familiar within. The Singaporean manager assured me that he and other Singaporeans working in the hotel have taken the same medicines before without ill effects. So assured, I took the prescription and felt much better the following day. It is such networks, small and big, which augment our strengths overseas.

The Singapore International Foundation, which is a government-supported civic organisation, has done a lot to network Singaporeans around the world. In many cities in Asia, North America, Europe and Australia, we have Singapore clubs and student organisations helping us to maintain this international network.

We must however not confine our network to Singaporeans alone. We are too small to be of consequence otherwise. We need friends and, from among them, we should welcome new members into our community. Into Singapore now, we welcome 20,000-30,000 new migrants every year. This is a large percentage compared to the average of 50,000 babies that we produce. In addition, hundreds of thousands of foreigners work in Singapore on employment passes and work permits. In the opposite direction, we have more and more Singaporeans working overseas, working side by side with the locals in other countries. This is the way to multiply our strength and influence. Good state-society relations worldwide help to extend the Singaporean network of trust.

We are bound together by the Singapore idea. It is not easy to define what exactly constitute the Singapore idea. It involves both the heart and the mind, and probably includes aspects like good governance, civic responsibility, honesty, strong families, hard work, a spirit of voluntarism, and the use of many languages and a deep respect for racial and religious diversity. Each aspect by itself is neither remarkable nor exclusive to Singapore, but collectively they are powerful. When Singaporeans travel, they sense acutely the aspects which they miss. When Singaporeans board a SIA plane to fly home, they feel half way home even though they may still be hundreds or thousands of miles away.

In your conference today on civic society in Singapore, I hope you will be able to define more precisely what the Singapore idea is and find new and better ways to bind state and society together. For it is in working together that we optimise our position in the world. In the web world, the state is not completely above society. They exist together drawing strength from each other. If one unfortunate day, the state is destroyed, it should be for society to re-create it. This was how the German and Japanese states rose again from the ashes of the Second World War. Our challenge is to create such a society. Although Singapore society was largely created by the state, it has to be Singapore society which ensures the state’s long-term existence.

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