It is important to name and face the threat of rising inequality in Singapore (Inequality is a threat - name it, and face it; Feb 18).
We must adopt a rational approach in tackling inequality.
First, we must be careful not to compromise economic growth for the sake of tackling inequality.
In economist Arthur Okun's 1975 seminal work, Equality And Efficiency, he identified a trade-off between equality and efficiency - the latter serving as a means to growth.
Traditionally, drastic attempts to reduce inequality, for instance, through excessive redistributive taxation, have been correlated with a negative effect on growth, such as through the flight of talent and capital.
Ultimately, the most sustainable solution to inequality is actually economic growth - growth gives us the resources we need to tackle inequality. Solutions to tackle inequality must, therefore, also have a positive effect on growth. Investing heavily in education and training is an example of such a policy.
Second, we must recognise that, rationally, those who are privileged would not wish to give up their privileges without something in return; such is human nature.
Opinion editor Chua Mui Hoong raised the example of primary school admission. Consider whether any parent, having obtained an advantage for his child, would want to give up that advantage for the sake of social equality.
Given the "kiasu" nature prevalent in Singapore, I highly doubt so.
Thus, privileges can be forcibly removed or voluntarily exchanged only for something else. In either case, the Government must try its best to get as much public approval as possible for its policies.
Third, we must not let legitimate attempts to tackle inequality spiral into the politics of envy, especially during elections.
In some developed countries, opportunistic candidates have exploited the resentment of the rich to drive their own agendas, often worsening social stratification.
Not only will the poor resent the rich more, but the rich will also feel less inclined to assist the poor. We must never let policies to alleviate class divide create a political system based on class divide.
If inequality were so easy to solve, we would have done it long ago. I believe we still can do so, but we must proceed cautiously and rationally.
Ng Chia Wee
