Sharing of common sense and wisdom…

18 April 2012  Wed

by:   Coffeeshop Observer



most practical viewpoint so far...

I read about the above article by this guy 伊修良 (Yi XL) and find it very enlightening.  Also read about the other opinions posted on the press which was posted on this blog – Provoking Thoughts (16 Apr); and in comparison with 伊’s argument extracted as above, so far 伊 provides the best argued case.

Simply put, many people out there are adopting “crying wolf” syndrome, trying desperately to shoot down, at first instance  Prof. Lim’s proposal for increasing lower income groups wages over the next 3 years in order to narrow the gap of widening wage disparity in Singapore. 
What these people trying to do is to blur the context of the issue and close the case, using the two “sacred cows” (inflation and productivity) for their defence. But not in the right context. What business community want is simply hope for lower wage labour (low costs) environment to be continued, they argue on the ground of free-labour market.

伊修良 is right to point out that, as to productivity, the lower income groups are employed mainly in the low-tech and cleaning type of labour work. There’s hardly any last drop of productivity to be squeezed out from such work condition.  In reality, productivity drop over the years is because of companies here kept hiring very low wage foreign labour. 

Many people also used inflation as a reason to shoot down Prof. Lim’s proposal for low income group. The fact remains, this group of low wage earners can never affect core inflation hike because they can’t afford to upgrade their housing nor buying cars. They also can’t afford on Orchard Road retails spending and cause inflationary pressure. This is using wrong context for their argument.
Interestingly, it is the middle income group’s economic behaviour that contributes to inflationary pressure, besides monetary policies.

Therefore, many people have missed the context of this issue, too quick to jump the gun and follow textbook answers. 

No wonder not many people really undetstood what Paul Krugman (US famous economist) trying to point to the core issues and context of US economic dilemma. Because what he says aren’t conforming to textbook argument. 


what does this means to low income groups?


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