Friday, February 13, 2009
GIC lost 41%? Accountabiliity please!
There are quite a few speculation about how much GIC lost in this crisis. As the GIC is directly under the charge of two heavy weights, Mr Lee Kuan Yew and Dr Tony Tan, it seems that such speculations are really "undesirable " and could well be kept as National Secrets forever.
Mr Lee Kuan Yew keeps saying that such investments are for "Long Term" but my question is, is it "Long Term" or "Wrong Term" already? Besides, with due respect, Mr Lee Kuan Yew is already at his ripe old age and many of his age would have enjoyed retirement life fully elsewhere in the world if they have his kind of wealth and social status.
Mr Goh Chok Tong's assertions about good governance keep ringing in my mind. He said a good government must be transparent and accountable, among other things like being clean. But how are we going to hold the present government accountable if whatever losses we suffer as a nation are being swept away as "Long Term" investment? Especially so when nobody knows whether one could live up to that definition of Long Term (which is not categorically defined as how long?), least a person of 80 over years old.
A WP member, Choon Yong, has an interesting account of what goes on in parliament. According to him, Madam Lim Hwee Hua uttered the figure 41% when Ms Sylvia Lim pressed for an answer to how much GIC has lost. This is really an interesting figure, though, not very surprising.
The PAP government has always claimed the figures of GIC as "National Secret". I am always very puzzled. If such important figures are being classified under "National Secret" how could accountability be exercised on the government itself? Well, I can understand that specific investment portfolio strategy is sensitive information but there is no necessity to keep aggregate figures as "National Secret" at all. Nothing to hide from there. If we are going to practice what good governance whereby accountability is a fundamental pillar, then specific figures and information should be made available. Figures like the amount of money in GIC and the percentage of gain or losses.
It is intriguing indeed. While the PAP government is ready to boast about how much GIC has earned in the past in a fascinating way (claiming to have how many percentage of return over how many years... etc), but when it comes to losses, it has suddenly become so secretive! It practically means that when it comes to claiming credits, PAP government is all too fast to claim it. But when it comes to take responsibility for lapses (well, do you remember Mas Selamat?) and losses, it suddenly sweeps everything under National Secrets!
If any figures are all National Secrets, then earnings from the past should be classified as National Secrets as well! Of course, that would basically mean that this PAP government does not believe in accountability at all. In Hong Kong, such critical figures would be available to public for scrutiny and it really makes me wonder why would Mr Goh Chok Tong go all the way to Hong Kong to teach something that PAP does not practice while Hong Kong government is already practicing! Without adequate information released, information that could well undermine PAP's leadership being hidden away, how could accountability be exercised at all?
Anyway, it is even more intriguing that the National Press has CONVENIENTLY omitted that "sensitive" figure 41% from their daily reports of the parliamentary debates! All is well when there are coordinated effort to avoid mentioning such potentially damaging data on National papers!
There was a report by foreign analyst that the amount of money that GIC holds initially could well be as high as $500 Billion. So if this magic figure of 41% is true, the losses of GIC alone would be $225.5 Billion! Although the official report of Temasek Holdings' losses is $58Billion at the end of 30 Nov 2008, but I guess this figure is grossly underestimated. This is basically because share prices has further tumbled in December 2008. The losses could be as high as $80 Billion by the end of last year.
Thus the total potential losses of GIC and Temasek holdings could well be $300 Billion! What does that mean? It means that it is a loss of $100,000 per Singapore citizen!
While PAP government has always been reluctant in setting up a formal system of social welfare for Singaporeans because it could squander off all our reserves, but it seems that the reserves could well be lost in a more dramatic and faster way in just one financial crisis like this one. The cruel truth is, such losses benefits no Singaporeans while at the very least, a social welfare system could at least benefit quite a number of Singaporeans, especially so in such economic crisis!
We have paid millions of dollars to PAP ministers annually for such mediocre performance which result in such losses that benefits no Singaporeans at all. Some may argue that such losses are "reasonable" because other funds around the world are making the same losses. BUT, please don't forget that we are paying our political office holders HIGHEST in the whole world but yet we are getting mediocre average results same as others? So the fundamental question is, are these "TALENTED ELITES of HIGHER MORTAL" value for money?
I believe this is not merely my ranting. Quite a number of people of middle class income came to my shop to ask me to make the same point. Our ministers are over valued. Their ministerial pay is just too ridiculous. These are not just normal ranting that we used to see in internet forums. These words are uttered by REAL Singaporeans on the street, some with very high qualifications.
This financial crisis has exposed the myth that PAP ministers are "extraordinary talents" that deserved to be paid millions of dollars per year. The PAP ministers may be highly qualified but they are just human, not "HIGHER MORTAL". Are they the "BEST"? Cream of the crop? I really doubt so. The reason being, the BEST and TOP people do not use monetary return as a value yardstick label to stick on them. These people know their limitations and would take responsibility and account for their mistakes. Obama is a good example. Ma Yinjiu is another good example.
I do not think with the present PAP mindset, we will be able to extract accountability from PAP ministers themselves. I do not believe that one could check on himself effectively without trying to shy away from responsibility. While billions are lost, not a single word of apology is heard from PAP ministers. The tightly controlled newspaper is still trying to trumpet it off as "better than others"! Of course, the usual rant that any losses are "temporary", no apology about that, no regrets about that but all for long term. While our children or even grand children in the far future "suffer" from such WRONG TERM investment, they wouldn't know who are the ones who are supposed to be responsible for these losses anyway.
So, this is the kind of accountability that PAP is teaching from their bible.
Goh Meng Seng