Grieving Lee Kuan Yew's Passing

I go through the news at least twice a day every day. For those who frequent this blog, I am sure that it will not surprise you when I say that I have tailored my newsfeed to focus on news stories that are focused on business, finance, and economics.

However, I saw a news story pop up the other day, the kind that doesn't usually appear on my newsfeed, which grabbed my attention.

It was a headline from The Wall Street Journal – Singapore Former Prime Minister Lee Kuan Yew’s Condition Worsens.

At age 91, Lee Kuan Yew has certainly lived a long life, and it is only natural that sooner or later, death comes for saints and sinners alike. And just this morning, I saw that he has finally passed away. No one lives forever, and though his passing was expected, I still feel a deep sense of sadness knowing that he is gone.

I was fifteen years old when I first read Alex Josey's book Lee Kuan Yew: The Critical Years (1971-1978) in my school's library. As I read about the political challenges that Lee Kuan Yew had to face – striving to have Singapore become accepted and then eventually being expelled from the Malaysian Federation, the conflict with the communists, the delicate balancing act that was needed to ensure Singapore's multicultural population did not devolve into ethnic strife, the establishment of an institutional and legal order that were needed to transform Singapore from a former backwater colony to a developed nation – my respect and admiration for him knew no bounds.

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It was right around the time when the conflagration that came to be known as the Asian Economic Crisis engulfed so many lives when I first read about Lee Kuan Yew. Although Brunei, the country where I was living at the time, was not considered as one of the countries that was directly affected by the crisis, when the indirect effects of the crisis merged with Brunei's own internal problems at the time – which involved a playboy prince who had misspent billions of the country's money to maintain a hedonist lifestyle (see here, here, here, and here) – Brunei's economy went into a tailspin.

As I compared him to other Asian leaders who were in power at the time, many of them now disgraced and/or forgotten, I felt bitterly angry that there wasn't anyone else who possessed the determination, the vision, the self-confidence, and the intelligence that Lee Kuan Yew possessed. I thought that Lee Kuan Yew was a giant among men and that he was the kind of leader that Park Chung-hee could have been; the kind of leader that world leaders ought to emulate.

Then for many years after that, I had stopped thinking of Lee Kuan Yew, until now. The simple reason for it was that despite the ravaging effects of the Asian Economic Crisis and Amadeo's implosion, life still went on. I went on to graduate from high school, went on to college and then graduated from college as well, learned and experienced new things, gotten jobs, quit jobs, paid bills, accumulated debt, went through personal hardships, overcame some of them, and learned to adapt to those that I could not overcome. Life has a way of moving on, it seems, and making us forget even things that we once held most dear.

As the years passed by, after being influenced by Milton Friedman's eloquent arguments for economic freedom, Friedrich Hayek's seminal book The Road to Serfdom, and Ayn Rand's philosophy of Objectivism, my views changed dramatically. And I stopped believing that Lee Kuan Yew was the kind of leader that others ought to emulate.

I rejected Lee Kuan Yew's tribal notion of “Asian Values” – the implication that “Western-style” democracy is somehow not applicable to Asian nations because of the particular sets of culture that Asians are born and raised in. I rejected the notion that culture determines an entire people's societal structure into perpetuity.

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The United States' military adventures in Iraq and Afghanistan and its subsequent failures to “impose democracy” on those societies might have somewhat exonerated Lee Kuan Yew's belief that cultural differences could cause an imposition of democracy on those societies to become a failure.

However, comparing Asian countries – such as South Korea, Japan, Taiwan, Hong Kong, and Singapore, which have developed their economies, social structures, and their political values since the 1950s – to Iraq which had been ruled by a fascist dictator and to Afghanistan that had been ruled by the Taliban for decades is a clear attempt at academic dishonesty. As the former countries' economies transformed from labor-intensive economies to capital-intensive economies to technology-intensive economies, people's priorities, thoughts, beliefs, and political views have changed.

The idea that people's culture is static is wrong. And it is clear that Lee Kuan Yew could not have failed to have known that. In other words, his notion of “Asian Values” was no more than a bald-faced attempt at retaining his own hold on power.

I also rejected Lee Kuan Yew's reliance on Orwellian social engineering programs and Machiavellian politics to curtail social vices that range from chewing bubble gum to caning people for drug-related charges. His use of the Internal Security Act, Singapore's version of Korea's National Security Act, as well as his penchant for bankrupting his political opponents (see here, here, and here), which effectively banned them from participating in politics due to the country's Bankruptcy Laws, was just as abusive, if not more so.

I also found it hypocritical that his government intruded so much into Singaporeans' daily lives despite his proclaimed belief that “the ruler or the government does not try to provide for a person what the family best provides.” The extent that is Singapore's Nanny State is especially glaring considering the fact that over 80% of the Singaporean population lives in public housing.

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However, Lee Kuan Yew's most lasting legacy, which will last into the future long after he is gone, is that he was the intellectual voice behind the foisting of authoritarian capitalism. He succeeded where Park Chung-hee failed. Unsurprisingly, Singapore has long been China's source of inspiration in its plans to develop its political structure as well as its socio-economic engineering programs (see here, here, here, and here).

Considering China's economic might, it is possible that the authoritarian capitalism that Lee Kuan Yew advocated and championed will define the twenty-first century as much as liberal capitalism defined the twentieth century, which would seemingly nullify Francis Fukuyama's theories in his book, The End of History. If Lee Kuan Yew's version of capitalism replaces the liberal form of capitalism in much of the world's zeitgeist, which I think it could, the social changes it could bring to the world will be enormous, in both good and terrible ways.

It has been many years since I thought that Lee Kuan Yew was the kind of leader that world leaders ought to emulate. As I said earlier, I stopped believing that a long time ago. Now, I have lost all faith in the benefits of concentrated political power even if it is in the hands of wise and benevolent leaders of whom I know none.

Although I now stand firmly against many things that Lee Kuan Yew stood for despite my youthful dalliances with authoritarianism, I am still grieving now that Lee Kuan Yew has breathed his last. Although I have come to stand opposed to his leadership style and philosophy, and dearly hope that his legacy will not be as widespread as I fear it will be, what no one can deny is that he was still an intellectual giant among men who had achieved more than most can even dream. Though perhaps not goodness, he has certainly achieved greatness and immortality in his own right. As Richard Nixon once said, had Lee Kuan Yew “lived in another time and another place, he might have attained the world stature of a Churchill, a Disraeli, or a Gladstone.”

Though I am grieving his passing, I do not grieve the authoritarian that he became. Rather, I am grieving the man that he could have been – an intellectual titan who might have attained the world stature of a Locke, a Jefferson, or a Tocqueville – a man who, above all else, might have used his staggering and formidable intelligence to champion the cause of freedom and liberty.

Unless you are on your deathbed
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Trickle-Down Economics Redux

The Straw Man Argument is a type of argument that is used to misrepresent someone else's argument, by way of exaggeration or misrepresentation or complete fabrication, with the intention of making the other person's argument easier to attack. It is a dishonest method that almost always undermines rational debate.

As such, almost everyone hates this form of argument. However, many people still resort to this kind of argument on a daily basis – some deliberately, while others unknowingly. And one of the most prominent Straw Man Arguments that have been used so excessively that many people have come to accept the Straw Man as gospel truth is the concept of Trickle-Down Economics.

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It is very easy to find arguments against trickle-down economics.

President Obama referred to it as “thinly veiled Social Darwinism.”

Senator Elizabeth Warren said that trickle-down economics “devastated U.S. workers while propping up the wealthy.”

Pope Francis pontificated against it, calling it a “a crude and naïve trust in the goodness of those wielding economic power and in the sacralized workings of the prevailing economic system.”

(I am not sure if Pope Francis is the right person to talk about naïveté or the idiocy of faith. See here and here.)

Economists have argued against it, too. For example, Paul Krugman said that trickle-down economics is “being nice to the wealthy and cruel to the poor.” And Robert Reich says that it is one of the “big lies” conservatives promise voters.

The OECD released a report that said that “the benefits of growth do not automatically trickle down across society.”

Trickle-down economics has also been attacked and criticized by thinkers, academics, politicians, activists, and journalists in Korea as well (see here, here, here, here, here, and here).

The case against trickle-down economics is clear. It is also clear that it has some very powerful enemies.

Not a friendly face in sight...
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But who actually supports trickle-down economics? Who is actually championing giving more to the rich? The answer is “No one.”

As I already said in a previous post:

Trickle-Down Economics does not actually exist. It is a lie. “Trickle-Down Economics” was a phrase that was devised in the United States in the 1980s when the Democratic Party needed a a catchy zinger to attack President Reagan's economic policy. The phrase was a remarkable political slogan as it painted Reagan and other advocates of tax reduction as sycophants who had all been bought and paid for by greedy billionaires at the expense of the poor and the middle class.

One of the most prolific economists of our time, Thomas Sowell, once challenged anybody “to quote any economist outside of an insane asylum who had ever advocated this “trickle-down” theory.”

To date, no one has ever adequately answered that challenge.

Quoting Thomas Sowell again:

Let’s do something completely unexpected: Let's stop and think. Why would anyone advocate that we “give” something to A in hopes that it would trickle down to B? Why in the world would any sane person not give it to B and cut out the middleman? But all this is moot, because there was no trickle-down theory about giving something to anybody in the first place.

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Those who advocate lower taxes, of which I am one, have never made their case by supporting the idea of transferring wealth from the masses to the rich. Rather, they emphasize the creation of additional wealth and jobs when businesses are not hampered by burdensome regulations and steep taxes.

However, even that is only half of the argument. Those who champion lower taxes do not support lowering taxes only for the rich, but also for everyone else. Crazy as it may sound, no free market capitalist has ever claimed that society would become wealthier because the rich would spend more. Rather, they argue – correctly – that tax cuts in general would stimulate the economy. That is because lowering taxes is based on the idea that if the government lowers taxes, the people – both rich and poor – will have more of their own money and will, therefore, tend to engage in more economic activity.

What is undeniable is that reducing taxes does help the rich more than it helps the poor. However, that is incidental. After all, the rich pay far more than their “fair share” of taxes. Therefore, it becomes all too easy to caricature any tax cut as “tax cuts for the rich.”

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Tax cuts might help the rich more, but it also helps the poor. After all, there are only four ways to spend money:

• Spend your own money on yourself.
• Spend your own money on somebody else.
• Spend somebody else’s money on yourself.
• Spend somebody else’s money on somebody else.

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Therefore, the phrases “trickle-down economics” and “tax cuts for the rich” are nothing more than the inventions of a desperate political mind that did not have the ability to debate the merits of an opposing viewpoint. After all, what easier way can there be to “win” a debate than to invent a viewpoint that no one holds, attack that viewpoint, and then claim intellectual victory?

This is not to say that there is no need for a real debate about which policies are needed in order to promote economic growth. With all due respect to Grover Norquist, God knows that lowering marginal tax rates alone is not a panacea (see here and here). That debate is badly needed. Unfortunately, however, demagogues are far too busy trying to slay the imaginary “trickle-down” dragon.

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