Go East, young bureaucrat

Sunday, April 17th, 2011

Go East, young bureaucrat, urges The Economist, and learn from Singapore:

The Singaporeans argue that they have the perfect compromise between accountability and efficiency. Their politicians are regularly tested in elections and have to make themselves available to their constituents; but since the government knows it is likely to win, it can take a long view. Fixing things like ITE takes time. “Our strength is that we are able to think strategically and look ahead,” says the prime minister. “If the government changed every five years it would be harder.”

There is more truth in this than Western liberals would like to admit. Not many people in Washington are thinking beyond the 2012 presidential election. It is sometimes argued that an American administration operates strategically for only around six months, at the beginning of its second year — after it has got its staff confirmed by the Senate and before the mid-terms campaign begins.

Yet even assuming that voters are happy to swap a little more efficiency for less democracy, Singapore still seems a difficult model to follow. Not only is it manageably small, but balancing authoritarianism and accountability comes down largely to personal skills (and even the opposition admits that the two Lees have been extremely good at it). More generally, Singapore’s success as a planning state has a lot to do with the sort of people who run it.

One thing that stands out in Singapore is the quality of its civil service. Unlike the egalitarian Western public sector, Singapore follows an elitist model, paying those at the top $2m a year or more. It spots talented youngsters early, lures them with scholarships and keeps investing in them. People who don’t make the grade are pushed out quickly.

Sitting around a table with its 30-something mandarins is more like meeting junior partners at Goldman Sachs or McKinsey than the cast of “Yes, Minister”. The person on your left is on secondment at a big oil company; on your right sits a woman who between spells at the finance and defence ministries has picked up degrees from the London School of Economics, Cambridge and Stanford. High-fliers pop in and out of the Civil Service College for more training; the prime minister has written case studies for them. But it is not a closed shop. Talent from the private sector is recruited into both the civil service and politics. The current education minister used to be a surgeon.

Western civil services often have pretty good people at the top, but in Singapore meritocracy reigns all the way down the system. Teachers, for instance, need to have finished in the top third of their class (as they do in Finland and South Korea, which also shine in the education rankings). Headmasters are often appointed in their 30s and rewarded with merit pay if they do well but moved on quickly if their schools underperform. Tests are endemic.

How much strategic intervention takes place in the economy? The Lees have dabbled in industrial policy, betting first on manufacturing and then on services. Temasek manages a portfolio of S$190 billion ($150 billion). The country is now trying to push into creative industries, with limited success thus far, as ministers admit.

These attempts at dirigisme have made Singapore a more reserved, less entrepreneurial place than Hong Kong with its feverish laissez-faire. It certainly has far fewer larger-than-life billionaires. But it is hard to hail Singapore as a success of top-down economic management in the way some Chinese seem to think. Indeed, the core of Singapore’s success — its ability to attract foreign multinationals — owes far more to laissez-faire than to industrial policy.

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