Singapore succeeded exceptionally well not because of original thinking, but because Dr. Goh Keng Swee, the founding deputy prime minister who inspired me said, "Kishore, no matter what problem Singapore encounters, somebody somewhere has solved that problem for sure. There's nothing new in history." So he said, "If we encounter a problem, let's go and find the solution, and then what we do; we copy the solution. So, Singapore has succeeded by being the best copycat country in the world. [Voiceover: This is Endgame] Hi friends, today we are having my best friend, Prof Kishore Mahbubani. He has very good knowledge in many problems, issues, and dimensions. He is a former dean of Lee Kuan Yew School of Public Policy in Singapore. And he has been in a lot of professional position in many countries. Hi Kishore good to see you.
- Good to see you, Gita. Thanks for having me. - Thank you, it's a real honor for you to be on our podcast, you know we've had this podcast for only a little over two and a half months. I wanna just
basically get started with asking you a simple question on how you actually started out. Your parents were from India, and they migrated to Singapore. Tell us.
- Well, my parents were, I mean, were Hindu Hindis when they were alive. And they were born and brought up in Sindh which is now in Pakistan, right? And as you know there was a very tragic painful bitter partition between India and Pakistan in 1947, and as a result of that, both of them landed up in Singapore in 1947, and I was born here in 1948. So that's how I ended up not being born in Pakistan but in Singapore.
- Okay. And what shaped your your academic interest all along in your early years?
- Well, actually, you know, I had no academic interest in my ideas. You know, in fact we had no books in the house. I mean right now, as you can see I'm surrounded by books. Because my parents had no education at all. My father, sadly his father and mother passed away within the first year of his life, and so he was brought up by his sisters. And unfortunately was not given any opportunities, and he must have stopped school probably at the age of 12. And at the age of 13 he came to work in Singapore in 1933 as a peon earning five cents a day. So, he had a very hard life, in fact he started smoking, drinking, gambling from the age of a teenager. And then of course he had an arranged marriage with my mother. And she must have had up to primary sixth, I guess, or a bit old secondary school education. But she came nowhere close to any kind
of high school or university education. So, there was no dream, no aspiration to go to university or any such thing all through my childhood.
- Did they try to basically have a different approach with you that it was important for you to pursue tertiary
education? - Absolutely not. - Really? Wow.
- I mean, they see that I ended up in university completely by accident. I see it, luckily for me, I did well in the
school exams, I seem to do well in exams. So, I would, after all, levels at the
age of 16, I got a bursary, that's how I ended up doing my a-levels at the age of 17 and 18 high school. And then when I finished high school the age of 18, I did what all Sindhi boys did at that time. I started working as a salesman in a textile shop earning 150 dollars a month. But then what happened was that by completely out of the blue, a complete surprise, I was offered the President's Scholarship which paid 250 dollars a month. So my mother said, "250 dollars a month is more than a hundred dollars a month so why didn't you go to university?" That's the only reason why I went
to university. - Oh my god, oh my god. And when you went to the university, what hooked you, what interested you?
- Well, I mean, luckily for me what really saved my
life is that at the age of about nine or ten, very young, I discovered the public
library in my neighborhood. So I began reading lots and lots of books from a very young age, you know, just, but they were all borrowed books from the library; novels, you know, fact fiction, and fact-based books. So the love of reading carried me into
university and of course the the most enchanting moments I had in the university was literally sitting between two like racks of books on the floor and reading philosophy books, and of course I studied philosophy in university. And I felt passionately in love with what I
was studying, and so as a result of that you know I never had any problems doing
well in university or in exams, and in fact for someone who came from a relatively poor family with no tutoring, no guidance, I ended up topping the faculty results at the end of university.
-You've done okay. You've done okay. Now who would have been your most or one of your most favorite philosophers throughout your study?
- Well even I did philosophy both at undergraduate and masters level and at the undergraduate level by far, the the philosopher I studied the most was Ludwig Wittgenstein who's Austrian German philosopher.
And then when I went to do my master's in philosophy at Dalhousie University in
Canada, I did a comparison of the concepts of freedom and equality in the writings of
John Rawls and Karl Marx. And I must say I enjoyed reading Karl Marx a lot, he's an amazing writer and with amazing insights into the human condition. - Okay. Why Nova Scotia of all places?
- Very simple, again by accident. The head of my department, and seriously it's all by accident no there's no plan at all. and I'll tell you a funny story about going to Nova Scotia because I had no idea where it was, what happened. - You know I've never been there,
but you know it's a place I want to go to one day. - Yeah I know it's really remote, I'll
tell you my story will explain how remote it is. I ended up in Nova Scotia because the
Head of the Department of Philosophy in Singapore Roland Puccetti an Italian American left the Department of Philosophy in Singapore and ended up becoming Head of the Department of Philosophy in Dalhousie University in Halifax, Nova Scotia So he gave me a scholarship, so I said "Okay you give me a scholarship, I go." So I went as a result of that, and I had no idea where it was, so I looked at the map, and the map according to my world map it seemed very near New York, so I flew to New York on arrow float, very cheap economy class. And when I arrived in New York, I took a bus.
- Oh my God.
- And the and the bus two and a half days. I mean, I was, I didn't know, I said,
according to me so near, but it's ... you know and it's greyhound. So, every every few hours you change and you know it was a quite an interesting journey.
- Wow wow. Hey I wanna digress a bit. I know you're a big fan of Mohammed Rafi, the famous Indian singer, right? What got you hooked with Mohammed Rafi? - Well, when I grew up as a child ,of course we had no ... the only instrument of leisure we had was the radio and radio Singapore would play for one hour in the morning and half an hour in the evening a song from Indian movies, and so Mohammed Rafi was on all the time. and what's interesting I find, you know, I can only write today at the age of 72 or even the last 10 years if I listen to Mohammed Rafi, and I have a of course a very amateurish theory that the songs in my childhood that I'm listening again now seem to be igniting some childhood neurons in my brain and making it easier for me to write. And
there's a huge difference between the quality of my writing with Mohammed Rafi and the quality of my writing without Mohammed Rafi. And there's no way I could have written, published seven books seven books in the last 10 last 15 years without Mohammed Rafi.
- Wow throughout the writing of each book, you had it on, you had more Mohammed Rafi on?
- Always, without fail. Otherwise if my brain doesn't work.
- I see. Well, I mean you know your brain is working fine under any circumstance. But did you
ever play musical instrument pulse the radio era? - No unfortunately. You see we don't forget and we had a very basic education yeah and we never had access to any kind of extracurricular learning or extracurricular activities so no musical learning no music no sports training
nothing uh just just regular school. - Okay now I'm just curious you had
Rafi then you had Marx's you know philosophical ideas in your head, right?
- Yeah absolutely.
- How did those two shape your thinking about where Singapore ought to go forward in the 60s? - Well I think in the case of Singapore I must say that looking back now, and I ask myself why have I been able to be relatively productive, I mean producing seven books in 15 years, and I think it's a result of the fact that I learned a lot without being aware that I was learning a lot from the three geopolitical masters I worked with, they were of course Lee Kuan Yew the founding prime minister, Goh Keng Swee the founding deputy prime minister, and Rajaratnam the foreign minister. And I spent a lot of time with them and
I think it was their constant curiosity questioning, challenging, asking, that
in one way or another I absorbed in my brain. And so I continued basically using their methodology of always asking questions and of course you don't get answers unless you ask questions. And they taught me how to ask
the right questions and so without them I don't think I could have written as much as I did
- Wow. Well, I mean I don't mean to peel the onion the wrong way, but how many episodes of you're asking the wrong questions would have been there?
- I'm sure they're ...
- Probably zero, right? - No. Well, as you know we are all human, we make mistakes and I've made lots of mistakes in my life, so you know and of course I've gone down the
wrong track hit a wall, and turn around, and come back.
- Okay, look, let's fast forward, okay. I've
read all your books, the latest one of which is "Has China One", you want to talk about that and what inspired you and you're thinking about Asia and the world over?
- Well I think it was very clear to me even four or five years ago that the biggest geopolitical contests that would rock the world will be the one within the current world's number one power which is the United States of America and the world's number one emerging power which is China and I could see even in Obama's time especially in the second term, a growing
misunderstanding developing between U.S. and China and of course it became much worse under Donald Trump, and so I told myself that clearly this is going to be the big issue of the day why not try to explain the structural causes of this conflict to everyone and also but the goal of the book is not just to explain but to also provide a path for the U.S. and China to climb down from their growing confrontation with each other so the the the goal
of my book hopefully is a noble one to prevent a major catastrophe from happening and I'm glad that at least the serious people who have read it, like it a lot. So Fareed Zakaria read it, and liked it a lot, made it the book of the week. Martin Wolf for the Financial Times read it, liked it a lot, and immediately agreed to provide me with a very generous endorsement of the book, you know. So i've been very fortunate that a difficult book like this has been understood and appreciated by many people. - Look, I mean it's if one reads just the
title of the book, it's easy to misconstrue this book as being pro-China, right? I'm trying to help with the sales of your books here. What what would be the one or
two things that you want to tell the Indonesian people so that they can
actually read the book and have a much broader based understanding of where China and the U.S. stand?
- Well, I think Indonesia definitely will also be affected right directly ordered directly by a major geopolitical contest because all countries around the world will be affected, but the key message even despite the title, this is not a pro China book, right? Paradoxically is
my American friends who have reacted far more enthusiastically to the book than my Chinese friends. And by the way, it has not even been published in Chinese in
China because of course, it contains of China, but the key message
of the book is that there are profound misunderstandings between the United States and China, and I'm trying to explain to both sides how profound these misunderstandings are so just to make two big points about the book. The first is of course that I explained the
structural forces that are driving this contest. The first structural force is that
the world's number one power for 2000 years is always try to push down the world's number two power, that's normal behavior. And the second structural force no one talks about which is the fear of the Yellow Peril and in the western psyche there has been a fear of the yellow man ever since the Mongols almost took over Europe 800 years ago. And then you have a third structural force
which explains the bipartisan consensus inside the United States against China and this the structural force was an expectation on the part of the Americans that if they opened up China economically China would then open up politically, and China would become a liberal democracy like America and they could live happily ever after because that there never happened at all. And of course future historians when they look at this American expectation will be very
puzzled that a country like America with only less than 250 years old with one quarter of the population of China it believed that it could transform a country like china which has got four to five thousand years of history and four times the population. So he showed you how naïve this American belief was, but even more dangerously the Americans have misunderstood in a very profound way because they keep thinking that this contest with China is a bit like
the old contest between United States and the Soviet Union which of course the United States won handsomely. And in the old contest it was a contest within a dynamic democracy in America and a rigid communist party in Soviet Union, so the democracy defeated the rigid communist party system. What I do in my book is I dig deeper and explain how the dynamic democracy of America has functionally become a plutocracy in America where all the decisions are being made not to benefit the people of America by the top one percent, and the bottom 50 percent in America have seen the average standard of living go down over a 30-year period. And that's why you have a sea of despair among the white working classes that has led to the election of trump the election of Trump could have been anticipated by this structural change in America and in the case of China instead of a communist party system in China. China has become the world's largest and most effective meritocracy where they managed to get the incredible people of incredible quality of mind to serve at the highest levels of Chinese government. And to get into the highest level of Chinese government is as competitive as getting into McKinsey where I believe you got into or as competitive as getting into Harvard University. And as a result of that the current
performance of the Chinese government is much better than the current performance of the American government, and this has been confirmed by Covid-19 where even though the the virus began in China, if they've had a few thousand deaths only, and if America had the same number of deaths per capita as China, then instead of having 240.000 deaths
in America, they would have had less than 1.000 deaths if the American government
had reacted as competently to Covid-19 as the Chinese government had done. So so it shows you so dramatically how this contest is no longer between a dynamic democracy and a communist party system, is between a plutocracy which has become dysfunctional right and a meritocracy and I say in a competition between plutocracy and meritocracy. Meritocracy can win, and that's why I
say the book is called "Has China Won?" - Wow that's that's very compelling and deafening. I mean going, you know, alluding to your naivete argument and alluding to your plutocracy argument, it's rather obvious, then where things are going to end up, right?
And how do you think this will dovetail into the global order and how
it dovetails into ASEAN? I'm just curious. Well, I mean, you know, in my book, in
the very first chapter, I have a fictional memo written by one of the colleagues of President Xi Jinping to President Xi Jinping saying "Dear comrade Xi, we have begun a great contest with America, of course, we will win the contest, but China must never underestimate America." And that's a key point I make in my book also. Because as Winston Churchill said, "You can always count on the United States to do the right thing after it has explored every other option." So, right now the United States is getting it all wrong. And that's why my book is actually a gift to America because I'm explaining to Americans these are the mistakes you're making in dealing with China, and at some point, I think hopefully they'll wake up with their mistakes and realize that they have been very naive in the way, that they're managing China.
- What are the chances that they'll wake up to this call? - Well, right now, unfortunately, you know, the great paradox about America something which I find difficult to understand is that they have the largest number of strategic think tanks. They spend hundreds of millions of dollars on strategic think tanks in Washington DC, and the rest of the United States of America. And then they have the poorest strategic thinking in the world and I'm not even exaggerating, it's really awful strategic thinking in the world, and of course as you know I mentioned in my book, I had a one-on-one lunch with Henry Kissinger who confirmed a critical point that I make
in the book that the United States has launched this geopolitical contest against
china without first working out a strategy and that's the stupidest thing you can do, right? But that's what the United States has done and at the end of the day for us in Southeast Asia in ASEAN, the best thing we can do is to have private conversations with our American friend, and tell them that nobody in Asia wants to take sides against China. Nobody. You know, I devote a whole chapter in my book to explain that even though we have concerns, obviously we have concerns about china becoming so strong, so powerful, and I explained it in a very simple way. You know I believe when I began this conversation with you 20 minutes ago there was a little cat sitting there very quietly purring away, I was very happy. Then after my conversation with you in 20 minutes, I turned around the cat has become a tiger. Of course you get very nervous, you know, you get very worried. And so in China has gone from being an economy that was 10% of the United States in 1980, to having an economy that's a larger in PPP terms. So clearly the cat has become a tiger and you've got to deal with the tiger differently from dealing with a cat, and that's why you got to change your attitude towards China. That's a reality and you cannot that China is not going to go back to becoming a cat anymore. China's going to be a tiger, and of course we are worried about the tiger in our neighborhood, but we got to find ways and means of managing this tiger. And unfortunately to be fair to China also, China has not fought a war in 40 years, China hasn't fired a bullet in 30 years. So, you know it's quite remarkable that the Chinese have been very strategically disciplined and by contrast the United States even in the last year of the Obama administration and Obama won the Nobel Peace Prize in the first year of his presidency. He dropped 26.000 bombs on seven countries. a lot of people And so the United States as a friend of America, you know United States America has spent five trillion dollars fighting post 911 wars. Five trillion dollars, if that five trillion dollars had been given to the bottom fifty percent in America, we've seen their standard income go down each citizen in the bottom fifty percent will receive a check for 30.000 dollars. That's a lot of money. Why burn it in fighting wars when your own people are suffering. And so this is where I think again as a friend of America I'm trying to give advice that will benefit the American people. - You know there's a lot of wisdom in what you've just said. I mean I'm just trying to think whether Donald Trump was the wake up call or Joe Biden is the wake-up call, unfortunately you see the United States still has not woken up
yet either with Trump or with Biden. Because there's a denial over the
biggest fact of the American condition that it has become a plutocracy. Now in theory you can walk, you can change a plutocracy, and walk away from it, but what's happened is that the very wealthy have been able to use their money to influence political decisions that create
tax regimes that benefit the top one percent as you know the carried interest prohibition that benefits hedge fund managers. And by the way the guy who warned against this is one of my favorite philosophers whom I mentioned earlier; John Rawls. And if you read his book "A Theory of Justice", you know it's amazing how prescient he was, you know he said, John Rawls said, "Categorically, if you allow money to determine politics then you will get political decisions that favor the wealthy." And that's exactly what happened and he warned against it. He John Rawls warned against this clear, and you know I met John Rawls in person. Amazingly enough when I spent a sabbatical in Harvard in 91-92 and all I'm asking Americans to do is go back and listen to American thinkers, American philosophers, and see where you went wrong. - You know it's pretty systemic, right? If I've been making the same case you have just now in many classrooms, the inflation of financial assets has gone up much more disproportionately higher than the inflation of real economies particularly that of the U.S.
- Absolutely yes. And I don't see this as being fixable
in the near foreseeable future, right? So as much as you think or we think that there could be a wake-up call, I'm not sure if that wake up call is going to be enough to fix that systemic issue, right?
- Yes and you're absolutely right. And the key word is systemic, and a systemic issue requires a systemic solution, and not a change of individuals from Trump to Biden that makes no difference at all because the system is still in place and at the end of the day the fun you know the as as I cited Martin Wolf in my book, the fundamental mistake was a decision made by the supreme court which treated companies as individuals and they could give as much money as they wanted to the political process and the net result of that obviously was that money was going to determine political outcomes in the United States. And that's exactly what has happened. You know in the U.S. for example, the pharmaceutical companies can lobby the congress to pass legislation that prevents the U.S. government agencies from negotiating lower prices from U.S. pharmaceutical companies. Now if this happened in Singapore it's called
corruption.
- In my country too. - Exactly. If any pharmaceutical company lobbied the Indonesian government to say you cannot lower your price, you cannot ask for lower prices for the Indonesian people, Indonesian people will be very angry, but that's what's happened in America, but you can't stop it because it's money. - You know it's it's pretty scary, there
is a pattern here, right? In terms of how the corporates have been able to co-opt political wisdom if not democracy as of late I think the technology companies have been exercising their lobbying power with such might that you know it's just unthinkable
in terms of how they've been able, and how they're going to be able to continue
co-opting you know the democratic wisdom in the United States or many other
countries. What's your view on that? - Your question is about co-opting ...
- Democracy. You know you mentioned the pharmaceutical example, right? And I'm mentioning the technological example right? Because the technology companies have basically mobilized as much if not more lobbying you know in DC and even at the state levels. So I'm not so sure.
- Yeah you know but you're also right about the technology companies and I think the technology companies are being very unwise in trying to use their lobbying power to
pass legislation in their favor because there'll be a popular backlash against them, and that's already happened you know, but at the end of the day it's not just a technology companies or the pharmaceutical companies as you said is the whole system that has to be changed, and here frankly the most fundamental decision that the American people have to make is to say that the outcome of the democratic process should be decided by people and not by money. That's the most important decision they have to make, and so for example, in countries like like say Singapore, Australia, and other places, they're very strict regulations on how much money you can use when you go for elections, and that's also true of most European countries also because they want to make sure that the people with lots of money don't end up winning the the game. And but in the case the United States, the absolute opposite happened and the United States has become a country where money decides outcomes and not people deciding outcomes. So we in the rest of the world, I would say Indonesia as the third largest democracy in the world should carry out a study of how money has distorted the American political system and put in place legislation now to ensure that this doesn't happen in Indonesia. - I think we've done enough studies, we're
just waiting for the publication of the books those studies. Hey let's move on a more positive note, right. Intuitively with a Biden presidency assuming he's gonna get you know inaugurated on the 20th of January, intuitively there could be better hope for renormalization between the U.S and China. How do you think this will imply for Southeast Asia?
- Well, I think with Biden, the tone will change, but the substance will not change. Because Biden's hands are tied and his reason is that his hands are tied because there's a very strong bipartisan consensus in the United States today. This is the moment for united states to take China on and to defeat it. And I think it's also driven by you know there's a very powerful consensus in what is called the deep state, so in the pentagon state department, CIA, NSC, they all agree that number that China's the number one challenge. and while Biden will be courteous
and friendly towards President Xi Jinping and by the way, the one man who spent more time with Xi Jinping than any other leader is Biden. Because when Xi Jinping visited the United States, Biden was his host over four or five days and has spent more time talking to Xi Jinping than anybody has. So the personal chemistry between the two men will be good, but that doesn't change the rock solid consensus within the and and if Biden appears to be
too soft on China, he'll be massacred. So we in Southeast Asia should not think that the U.S. - China geopolitical contest is going to blow over soon that it will be carrying on, and so we should be ready, we should be preparing shock absorbers in Southeast Asia to prepare for the shocks that are going to come. And the best way to prepare a shock absorber is to make ASEAN stronger, because if all 10 of us stand together, it's easier for 10 of us to say no to China, or 10 of us to say no to America than for us individually to say no to them.
- Is there hope for that? We've had episodes where maybe one or two out of the ten might have thought differently in in the past few years? Is there more hope now?
- Yes. And I think I hope the Chinese learned a very important lesson from 2012, and as you know in 2012 this is now open information there was a lot of pressure on the Cambodian government to block any references to the South China Sea in the ASEAN communique. And as you know your friend Marty ... - I was a colleague of this at that time, I was still in the government.
- That's right. He saved the day. Marty saved the day by overcoming the Cambodian opposition by going around, flying around Southeast Asia, and getting agreement, and finally he managed to get an ASEAN joint communique out. I must say that was a heroic performance by Marty which I think has not gone unrecognized. - I know.
- He should win the ASEAN medal of honor for saving ASEAN at a very difficult time. But I think the lesson I hope the Chinese learn from that and I've repeated that in all several of my books now that it is not in China's interest to divide ASEAN, that was a mistake it's in China's interest to see a strong ASEAN because then you have a stable set of countries in your southern border. Because if ASEAN breaks apart then it provides opportunities for China's adversaries like United States to come in and use these divisions and use some ASEAN countries against China. And that's why by the way the Chinese made a very wise decision to go ahead with the signing of the RCEP
- Oh yeah fantastic. - this week and that's a very big deal, and that shows the recognition by China that they really need a strong ASEAN because RCEP is an ASEAN initiative, and not a China initiative that has been successful.
- I was one of the initiators in 2012. - Well you deserve to celebrate.
- No, no. But let's peel the onion here on RCEP. Okay, I'm off the view, I'm in complete
agreement with you on RCEP. I think it is not only is it the right framework for
ASEAN and China and of course the other countries of South Korea, Japan, New Zealand, and Australia. Unfortunately India you know didn't get a chance to join up, but I think it resonates a lot better with developing countries like Indonesia you know the framework of RCEP. And I used to be quite vocal about this in the sense that you know I was a little bit more hesitant about the TPP framework because it was a little too 22nd century as opposed to RCEP which I thought would have been more 18th or 19th century-ish, and geopolitically and economically it's easier to roll forward as opposed to roll backward time wise and it's worked out okay because it resonates with people in Laos, Cambodia, Indonesia and some others in Southeast Asia.
In contrast, I'm of the view that I think it's going to be very difficult for Biden to re-engage the world over with respect to TPP given the domestic Covid -19 situation, and where RCEP is going to go. I'm curious of your views on this.
- Yes I remember very well your
your statement that TPP was a 22nd century agreement and I was about to quote it to you when you said it, I remembered it very well and that RCEP was the 18th-19th century. I think I would say 20th century agreement. -Okay.
- But I must say that if you want
leading indicators of what the world of 2050 will be like, 2050, 30 years from now it's going to it has been made by decisions made in 2020. And the decision of the RCEP countries; China, Japan, South Korea, ASEAN, Australia, and New Zealand to sign RCEP means that when
there were three competing visions for this region, one was the Asia Pacific
vision captured by APEC, then you have the new Indo-pacific vision that the United States
is selling now to bring India in, and then now you have the third East Asia vision. And of these three possible outcomes for our region, the signing of ECEP and the walking away from the United States from the TPP has killed the Asia Pacific vision. The walking away of India from arsenal has killed the Indo-pacific vision, and that leaves the East Asia vision. And so that is very clear the shape of 2050 is being made by decisions made in 2020. And I can tell you India has made a huge strategic mistake in staying out of RCEP, and
what is puzzling, I mean ethnically an Indian. Okay, you know Deng Xiaoping
made one very important observation, he said, "Why is it Chinese are so successful everywhere around the world except in china?" And the reason for that is there's no economic competition inside China. The state was producing everything, so he brought in economic competition to China, and sure enough the Chinese in China became as competitive as the Chinese in outside China. So in the same way the Indians are hugely competitive everywhere in the world they go to and you know the most competitive laboratory in the world as you know Gita, is the United States of America. The best brains from all over the world go to the United States of America to compete and guess which ethnic group has got the highest per capita income United States is the ethnic Indians. And you know it's only Indians can run the world's largest corporations that Google is run by Sundar Pichai, and Satya Nadella and Microsoft, and and I had a private conversation recently
just to talk about the world also and the so you can see the Indians are inherently
competitive. So why is India frightened of economic competition in fact the rest of us paradoxically we should be frightened of India joining RCEP, instead of India being afraid of joining RCEP. So there's something is wrong here fundamentally and I hope that the in some some Indians
will go back and think very hard because the decision to stay out of RCEP.
This decision to stay out of RCEP sadly and I want India to succeed obviously right. I'm an Indian I want India to succeed, but India's decision to stay out of RCEP is going to damage India because at the end of the day the strategic dilemma that India faces
is that by staying out of our set we get short-term gain, right. But it gets long-term pain because the economy is not competitive whereas by joining RCEP they get short-term pain you get creative destruction of some industries, but you get long-term gain because you become competitive as an economy. This is fairly, this is not rocket science, you know this is very basic, and I'm surprised that and frankly the real story about India is that
there are vested interests in India that are also preventing competition from coming to India, and then that's unwise you know. - Yeah, but I don't know the little part of me says I think India is going to come back to the table. - I hope you're right.
- Well luckily we're not giving a time limit to India you know whereas other countries only have 18 months to join you know, so it's a free call option for India, and you know if they get their act together, I think they'll come to the table. - Yeah it's very wise to keep that window open for India, and I India wakes up and realizes that you'll be left out of the game if it doesn't join RCEP.
- Right. And I'm optimistic on the basis that India technologically speaking has been opening up to the Google of the world, to Microsoft' of the world, and the Facebook of the world, so that I think is a reflection of what's to come. I think they're gonna have to learn to open up, and yeah probably the first few years they're gonna be exposed to cheap Chinese goods and services, but you know they'll be very competitive as you have suggested earlier.
- Very competitive because they you know can say as an Indian that in my encounters with Indians I discovered they're not stupid at all. - It's like talking to yourself, right?
- In fact they're all super smart. - Hey you know I wanna pick one of your
many books that I've read, "The ASEAN Miracle". It says it has been an inspiration to me and to the people that I've taught in classrooms. Talk a little bit about this if you've
made the point in that book that ASEAN deserves a Nobel prize for peace for for having kept ourselves peaceful and stable please. - Absolutely and I think I must say it's
very sad that the Nobel Peace Prize is decided by a group of old Norwegian mostly gentlemen. Because I think many of them don't see what's happening in the non-western world, and don't understand what's happening in the non-western world and just to give you
another example, I thought it was very unfair for them to give the Nobel Peace
Prize for the Aceh Agreement to a wonderful Finnish gentleman who's also someone whom I know and met, instead of giving it to the Indonesian President SBY you know and ...
- Say it no more, Man. Say no more.
- I mean it was very unfair, very very unfair, but it
reflected the western mindset that only westerners deserve Nobel Peace Prizes. So, in the same way, the Nobel Peace Prize committee has done a huge disfavor by not giving ASEAN the Nobel Peace Prize when he celebrated his 50th anniversary in 2017. When I published the book "The ASEAN Miracle", because it's what ASEAN has done is absolutely amazing. I mean future historians write about ASEAN, they'll be amazed that an organization that was designed to fail in 1967. And it was designed to fail because its two predecessors ASA and Maphilindo died within a few years. And ASEAN is also by far the most diverse region on planet earth. I mean out of 650 million people here, 250 million Muslims, 150 million Christians, 150 million Buddhists, Mahayana Buddhist, you have Hindus, Taoist, Confucianists, and we even have communists. It is by far the most diverse region of planet earth, and if the most diverse region of planet earth, a group of developing countries can keep peace for so long with each other, surely they deserve the Peace Prize no other region even comes close. So I mean like even to, I mean it's wonderful to give it to the
world food program and so on so forth, but frankly if you're talking about peace, real peace, it's ASEAN that has delivered peace. And I think they at some point in time, I hope the Nobel Peace Prize committee will wake up and realize what a huge mistake they have made in not giving ASEAN the Peace Prize because no other organization deserves a Peace Prize more than ASEAN does.
- Wow that's that's very powerful. Thank you for vocalizing that again and again and again. Now let's ...
- At some point in time they will listen. - No, I think they will. Now let's
let's talk about ASEAN here. ASEAN has differential marginal productivities, right? And I always look at Singapore as the apex of marginal productivity, they've been able to prove to the world that they can produce in the most efficient manner, and this is largely attributable
to the fact that you've built such a fantastic meritocracy, right? And what is it that
you think some of the other or all the other countries in ASEAN could pick up from Singapore faster than in the last 60 to 70 years? - Well, actually what they need to pick up
from Singapore is a very simple principle, Singapore succeeded exceptionally
well not because of original thinking, but because Goh Keng Swee, the founding deputy prime minister who inspired me said, "Kishore no matter what problem Singapore encounters, somebody somewhere has solved that problem for sure. There's nothing new in history." So he said, "If we encounter a problem, let's go and find the solution, and then what we do; we copy the solution." So Singapore has succeeded by being the best copycat country in the world. Now if Singapore has spent the last 50 years copying best practices from other countries, why don't the ASEAN countries come to Singapore and copy from Singapore. So you know you don't have to, and I don't understand why they don't do it. I mean sometimes they do it, I mean the Malaysians were brilliant, you know. You know at one stage they wanted to get investment in Penang, and you know Penang been very successful, so they said how to get investment in Penang, they say okay, they look for the economic development board brochure from Singapore on why you should invest in Singapore, then they delete Singapore, they put blank. So everything else is same. Okay, why is you ..... "Oh we got good board, we got everything." So, guess what? Penang succeeded dramatically. - Oh my God.
- So all you got to do is copy. So you know if you want to do that in bottom, go and get the economic development board brochure why you should invest in bottom, and do it, that's all. You know it's actually and
everything we do, look at our education system, our education system is all copying other
countries you know, what they have done. And so in a sense all you have to do and that's why when I was dean of the Lee Kuan Yew School of Public Policy, I always told my students that all you got to do is you don't have to reinvent the wheel, go and find someone who solved the problem, copy. And Singapore's success as a copycat country. And by the way Singapore is not the first to do it. The first to succeed were the Japanese in 1860s with the Meiji Restoration. And that's why Goh Keng Swee studied the Meiji Restoration immensely to understand why the Japanese succeeded, you say, "Hey the Japanese succeeded by copying others, okay we will succeed by copying others too." And copying is actually quite easy. - Yeah. No no, I like copying you know success stories or best practices from other places, but you know I've attended so many ASEAN meetings, right? This sort of conversation should be more prevalent in the conversations amongst ASEAN, you know, call it friends or ministers or officials, and all that. I
just don't think it would have been enough conversationally and I do believe that
you know to some extent or to a lot of extent, this depends on the degree to which you have that culture of reading, and I struggle to get people around me to read books as it
is you know that I think is the second concern or problem. So anyway, I say all this ...
- And you're absolutely right about reading books though. I mean as I told you if I hadn't discovered the public library near my house, within a mile at my house, I would never have succeeded in my life. It was just reading reading reading that enabled me to succeed. So I completely I want to endorse if you if you want to help a poor child anywhere, give them books, and give them a chance to read. And then that sets the brain on fire, and then they progress.
- Yeah, yeah. Wow. Okay, let's go back to the China situation here, okay.
I want to push the envelope a little bit, okay. China has gone through a diminishing
scale of its current account, okay. It's been running at a surplus for 25
years in its current account, right? Last year and this year I think they're quite
exposed meaning their current account is going to go to a lower level and I think they run the risk of going into a deficit territory that basically reflects upon the degree to which they could export capital, right? I wanna see your views on how you think that will have implications on their belt and road initiative. - Well I think it's broader than it is the belt
and road initiative, but it's broader than that too. I think the Chinese have basically decided, and this is of course partly a result of the U.S. - China geopolitical contest, that the old model of relying on export that growth, and it was exports as you know that created the huge surpluses in their current account can no longer work because countries around the world will either refuse to accept more Chinese imports like India has for example, or the markets are not big enough. So the Chinese have made a major U-turn and gone from export that growth to what they call the dual circulation theory, so you rely on two legs now. You rely on exports, Chinese exports will remain quite strong still, and you have also a domestic consumer-consumption. And let me give you one statistic which I just learned yesterday which is quite stunning; the domestic market for retail goods in 2009, about 10 years ago, in the U.S. was four trillion dollars,
China was 1.8 trillion dollars. You fast forward to 2019, China's
retail good market has gone from 1.8 trillion to 6 trillion, and United states is still
somewhere double check that around 4 trillion or so. So it's gone from being half,
less than half of the United States to and so at the end of the day, if they can continue to push consumption up, that's going to become the engine of China's economic growth. And by the way that's good for us because we in ASEAN are also going to benefit tremendously from an increase of consumption in China. So the only growth engine that's really
going to pull ASEAN out of Covid-19 is China as a result of that and so but the belt and road initiative by the way, they still have about three over three trillion dollars in reserves, even if they set aside one trillion dollars, that's more than enough money for the belt and road initiative for 10-20 years, you know when you look at the rate of spending that they're doing, and they're also in the process learning quite a bit and learning how to
inject good governance, best practices, making sure that the money that they
lend out is safe and strong and healthy and you know if you look at the performances of these two banks; Asian Infrastructure Investment Bank and the New Development Bank, and you did an objective audit of them, and the management practices they are actually doing better than the World Bank. And the Asian Development Bank for example, in administrative costs the
AIIB has been able to cut down, I mean cost much more than ADB or World Bank, and as a result that of course you can lend more money right? More bang for the buck. And so the the Chinese are doing thing main things in many areas that are that I think are that are right and
and ensures the meritocracy, that china has developed.
- You know I'm encouraged by the fact
that China has been dramatically increasing their domestic consumptive propensity, you said it's going to be good for us because we can send goods and services to China, right? But I think at the same time, it's going to force us to better you know vertically integrate you know from a supply chain standpoint. You know, at this rate you know there's still some
countries in ASEAN that do not have the necessary capable manufacturing capabilities, right? But I think in time they're going to be forced to basically manufacture so that these goods and services are going to be you know consumed by the Chinese who will be consuming in great scale.
- And I would say the country that has the best opportunity to benefit from this is
Indonesia, because you know you're a young country you have a young labor force, I haven't followed closely your recent actions on your labor laws, but if the labor laws reform goes through, and there's a greater flexibility in the labor market, then I predict that that should bring in more investment into Indonesia, but you are a better judge of it than I am.
- Yeah yeah well it's it's moving uh in
the right direction. I'm optimistic that our investment climate is going to be better by way of the open-mindedness of the labor framework. I want to push on this since you brought up investment, right? If we take a look at the FDI on a per capita basis for a number of countries in ASEAN, Singapore is the Lebron James, right? They are attracting FDI at a rate of 19.000
per person whereas Malaysia is attracting FDI on a per capita basis at 270 dollars,
and Vietnam is at 160 dollars per capita whereas the Philippines, Thailand, and Indonesia are at a much more paltry amount of 91 dollars per capita, right? And this is a this is ironic in the
sense that you know we are witnessing tremendous amounts of liquidity sitting and floating around the United States, Western European countries, China, Japan, and South Korea waiting for
destinations or looking for destinations what is it that you think you know Indonesia, Thailand and the Philippines could do better to improve or move the needle from 91 dollars per capita of FDI to the level of Singapore? - By the way I have, again, you know I want to go back to my point about copying and I would say if I was an Indonesian, the first thing I would do is to ask a group of five or six economic professors to go to Vietnam and to look at where Vietnam was 30 years ago in 1990, look at the Vietnamese infrastructure,
look at the Vietnamese state regulations, look at the amount of investment
in Vietnam 1990; zero. Now 30 years later fast forward, why is Vietnam getting ... do you go by your figures per capita? So the question is "Why? That's all.
And so just going copy Vietnam. So if the Vietnamese can you know
create as you know industrial sites and develop everything like world-class
facilities and provide everything electricity, water, workers, everything
already. You go in there, boom, you take off. So I think in a sense Indonesia doesn't have to reinvent the wheel, let me forget everybody else, just focus on one country Vietnam. So whatever Vietnam does today, you do tomorrow, that's all. - Okay I want to push on this okay because I think to some extent this relates to the political system of the respective countries or economies, right? I'm always off the view that you know at the rate that you are multi-party, you're somewhat shackled in terms of your ability to think long-term, right? Because you're always shackled by the cycles of five years or four years of political processes and especially if you've got a dozen political parties whereas Vietnam does not have that kind of a scenario, Singapore similarly does not have that kind of a scenario, right? So would you have any political wisdom or advice for us in countries like Indonesia?
- Well let me amend
my proposal, don't send five economics professors, send the leaders of all your political parties to Vietnam. I'm serious.
- Oh yeah okay. - And then show them the charts in 1990; where Vietnam was, where Indonesia was, then 2000 and 2010 and 2020, that's all. just show them, and but you must take them physically there and see what they have done and then see the the poverty reduction rates in Vietnam. And by the way the Vietnamese had to go through a very painful transition
in dealing with foreign investors, and it was Mr. Lee Kuan Yew who described this very well; the Vietnamese got so used to being guerilla fighters against the Americans in the Vietnam war. So they saw foreign investors also as foreign invaders that they should use girdler tactics on them, and so they would negotiate a deal with the foreign investor, and then after the agreement is signed. The next day when the foreign investor came to implement it, they said, "Sorry, deal change." "Excuse me, I just signed yesterday." But I said, "That's yesterday, this is today." So they went, and then of course the investment dried up in Vietnam as a result of that. So Lee Kuan Yew had to personally tell the Vietnamese leaders, "Excuse me, this is not, these foreign
investors are not foreign invaders, these are the people you got to get into your country and you got to respect the agreement you signed." And for the Vietnam is very painful. Very painful you know because they saw suddenly the foreigners making so much money, yes, but they're also creating jobs in Vietnam you know. So it's a question of seeing that you've got to learn the whole process it wasn't easy for Vietnam. But I must say the the Vietnamese story is just completely inspired. You know, no country ... - I'm with you, Man.
- ... has failed, has fought wars as long as Vietnam has. Vietnam was in war more or less continuously...
- From the thousands of years.
- from 1940 they were occupied by China. But from 19 would say roughly from the beginning of World War II you know, remember they were also invaded by the Japanese and all that from 1939 to 1989; 50 years none stop fighting you know, and fighting not against small countries. They fought the French and defeated them. They fought the Americans, they defeated them. And they fought the Chinese, and also defeated them on the battleground, but they had to concede after that subsequently. So you can see the Vietnamese despite fighting wars for so many years when they suddenly realize, "Hey now the game is you're not going to win the game by fighting wars, you're going to win the game by getting foreign investors to replace foreign invaders", and then you got to be nice, you kick the foreign invaders in the teeth, you cannot kick foreign investors in the teeth, you got to smile and be nice to them. Very painful. Well the Vietnamese very euthan, and I'm amazed. I tell you if you had asked me 30 years ago "Would Vietnam succeed in economic
reform and development?" I would have said "No way, these are guys that don't want
to fight, they don't know how to trade." - They've defied many of us, they've defied the odds. I mean you're coming from a developed first world country and you have gestured so much humility in and basically you know there's
stuff to be learned from Vietnam and I come from a developing
country, right? And I can tell you there's still quite a few of us out here who probably don't see Vietnam as a place that we could learn from and I think is the mental block for us in terms of you know development forward, so that that I think is ... Sorry,
go ahead.
- I know I was going to say that you know as you know China developed because they sent hundreds of mayors to learn from Singapore, right? You know what, now Singapore is sending people to China. I mean why Shenzhen
- Oh my God. - so much more successful than Singapore, why? I mean the economic growth rate in Shenzhen is absolutely amazing. I saw Shenzhen
in the 1980s, there was nothing there. Rice fields and everything, nothing. And now you go to Shenzhen, it's amazing you know. So you know that we all, the only lesson I've learned in life is that you cannot stop learning. And so every day, every country should be
copying best practices from other countries. Every day. And by the way, the most, this idea of learning from others was the western habit that we learned, but the west has lost that habit of learning. And as you know the reason why I'm
so critical of the west is that the further west for Europe for example is mismanaging Covid-19 so badly. Has any European government sent one delegation to learn from East Asia? Zero. So the Europeans themselves are so proud the idea that they can come and learn from Asia, they cannot buy, but they're being very stupid, right? It's very stupid and it's stunning. So we in Asia therefore must show the rest of the world that when it comes to learning, we are number one.
- Yeah, absolutely, no disagreement. Alright, let me push on a button called tourism, you talked about it in a couple of your books right? How we can basically develop you know in terms of projecting soft power by way of getting more people from the international community to visit. I always struggle to justify why only 14 million people visited Indonesia last year, whereas you know close to 40 million people visited Thailand, and over 20 million people visited Singapore last year, and the last time I checked we have more islands than Thailand and Singapore do. So yes can you give us some tips and and how this thing will .... yeah - Absolutely because, I mean it's actually quite amazing again this is a little known fact Bangkok
gets more tourists than any city in the world. And this is despite its traffic jams, and despite all the problems of flooding, and this , and that, you know it's not a developed city you know, but the the Thai people are just so welcoming. You know how they ... I don't know how to describe it, they're so friendly it's a friendliness. And frankly the Indonesian people are equally friendly, right? Equally friendly. And so actually I think that the the industry, the one industry that
can really take off Indonesia very fast is tourism, and more and more people I
think want to go to Indonesia, but you need to develop the infrastructure. And I must say the wisest thing that Indonesia can do is to sign as many open
skies agreements with countries because when you send a sign in open, when you said you interviewed Tony Fernandes, when Tony Fernandes flies his aircraft into Indonesia, he's bringing tourists into Indonesia, and Indonesia benefits from it. So I
say that that's the easiest thing for Indonesia to do, and I can tell you when I
go back to Dr. Goh Keng Swee, you know Dr. Goh Keng Swee, right? Is it why are
tourists coming to Singapore? There's nothing you see in Singapore, right? And Singapore is so small, right? I mean look at it, I mean as you know I always tell my friends a story,
in Indonesia you have one mountain, on top of the mountain you have a lake lake Toba, in the middle of that small lake there's a small island, and that small island is bigger than Singapore. I mean so you can see Singapore is so stupidly ridiculously small, why come to Singapore? So Dr. Goh had a big study and they said we don't know why.
- Well, someone said Toba do not yet have Orchard Road, right? But at such time when we have Orchard Road out there, I think it's gonna get more tourist than Singapore.
- But it's not just the consumer
side. I think, I predict that the fastest growing tourism sector will be eco-tourism, and people want to go and see natural places and natural forests. So and I think
that's something that Indonesia can aspire to be number one in the world in terms of eco-tourism, and this is something that will bring in investors very quickly, who will want to invest in resorts in remote places. And as long as people can fly, there they will go there. And that's a tremendous advantage that Indonesia has, you know. And I
was told by Ali Alatas once that the legend yeah the legend, oh he was a very good friend of mine, I learned a lot from good very good friend, a very good man, I
liked him a lot, I was very fond of him, and he said there was once Indonesia
produced a series of programs about Indonesia, and he said millions of Indonesians
watched it because Indonesians themselves did not know what a beautiful country Indonesia was, right? And you have these amazing places in Sulawesi, in Sumatra. So you're an amazing country. I would say that you know post Covid-19 the best way to jump start
the Indonesian economy is to really open up your doors to flight from anywhere, and just allow a bit of chaos, it's okay to happen. And then in the process of chaos, more and more people will come and discover Indonesia. - You know I've been hypothesizing or asserting as of late that there's no reason for Indonesia not to get 150 million tourists internationally a year with 17.000 islands now. I want to go back to your earlier ...
- And just as a small aside, in 2019, China sent out 130 million Chinese. The Chinese love to go to United States of America. The United States of America is going to
become unwelcoming for Chinese tourists that creates a market opportunity, you see? this is an example of strategic thinking. And therefore, set up a department
in your ministry of tourism just for Chinese tourists. And I tell you I was shocked you know when I went to the Maldives, I thought in Maldives only the orangutan will go there, right? Only the or only the westerners like this beautiful nature and all that. I was stunned by the number of Chinese tourists in Maldives, because the Maldives government set up a special unit to bring in Chinese tourists. You see, you can copy. You know we went there, my wife and I, and when we landed, I can tell you if I looked left and right, sixty percent
of the tourists were from Mainland China. I mean I was shocked shocked by that.
- And you know how you take the seaplane from the capital city to the
island, right? And you know it seats about 15 people, we were the only Indonesians you know, and the remaining 13 were Mainland Chinese. - Yes, that's quite stunning.
- It's staggering, but ...
- And by the way India is much nearer, and there's so few Indian journeys going
to Maldives, but you see that there's a huge market and you see don't forget, I forget the term for you, I think there's an economic term for it, there's a tipping point where people can suddenly, when they suddenly have what they call disposable income.
- Correct.
- They all their lives, they just have enough to go kidnap the kid with enough to keep going, and now the Chinese per capita income has reached a tipping point when not only suddenly hundreds of millions of Chinese now have a few thousand dollars in spare cash that they never had before. And by the way, a few thousand dollars in spare cash is all you need to get to Sulawesi you know, or get to Papua or ... and you know I can tell you as soon as Covid-19 is over, one of my dreams is to go travel to all parts of Indonesia. - You let me know, Man. I'll be happy to be your tour guide.
- I want to come and play on your golf course in Bali.
- Hey, you alluded to the eco-tourism
okay, I want to push on this environmental button right. I'm absolutely in agreement with you, you know at the rate that we have a finite amount of fossil fuel to burn and emit, there is no choice for humanity but to basically gravitate to a renewable energy. And
it's it's just amazing if I talk to the generation Z members still not a whole bunch of them you know are engaged in conversations on preserving the planet. What is your view
in terms of being in the context of ASEAN or the world's basically embracing this framework? Call it the Paris Accord or call it whatever it takes for us to basically be able to preserve the planet.
- I think fortunately among the young people all over the world there's a growing awareness and understanding that we live in a small in parallel planet earth you know and we have to come together, and that's why you know in the closing paragraph of my book "Has China Won?" I say that if U.S. and China keep fighting while global warming is happening, future historians will describe them as two tribes of apes who are fighting each other while the forest around them was burning, and we think only the apes are so stupid as to do that, but we human beings are being very stupid in not coming together to stop global warming but the young people understand that increasingly and the good news is that China is being ecologically responsible is the first country in the world to create the concept of ecological civilization, and I wish the united states would copy the concept of ecological civilization too. And then the Chinese people as a result are becoming much more environmentally aware of what's happening. And so I
expect that the Chinese people will also buy this idea of eco-tourism. And I think the what you should do of course is to try a few experiments of marketing it in various Chinese cities, and I'm reasonably confident that you will succeed very well.
- I'm actually optimistic about China's playing a very proactive role in preserving the climate and the planet if we take a look at how they have been so resolute in reaching peak you know carbon emission in the year 2030, and how they've been able to embrace electric vehicles for transportation purposes, how they've been pretty I think consistent in reducing you know dependence on coal, and all that good stuff. If there is any country that's been
proactive towards you know this big goal of climate change I think China, and I actually see it, I see China as having a positive impact on how we behave in Southeast Asia, and then you could you know allow that to imply on eco-tourism but I think it could imply on to many other
things that we do out here in Southeast Asia. Do you have any views on that?
- No, no. I agree and I think it's such a tragedy that The United States always says "China is the largest emitter of greenhouse gas emissions." But that's only if you count the current flow, if you look at the stock that the United States has put in the atmosphere, the United States has put far more greenhouse gas emissions in this atmosphere than China has. And it's shocking that it is China which is still relatively speaking a developing country has announced a carbon neutral goal of 2060, and United States hasn't announced a carbon neutral goal. That's terrible. The world's richest country should also be
the world's most responsible country, and it's shocking that United States is
not doing so, and therefore we from outside should apply greater moral pressure on United States and say the United States must lead the way in setting an example in terms of responsible behavior towards curbing global warming. - Alright I want to move from the environment. We've got a few minutes left, I want to move from the environment to technology, okay. I've been saying in a number of occasions how individual democratization has not led to the right kind of equality. I've also been saying how market democratization neoliberalism has not led to the right kind of equality. And as of late I've been saying how data democratization has not
led to the right kind of equality that the world needs. I'm curious as to what your views are with respect to data democratization or technology? - Well, you know I emphasize to you that
the copying is the best way of learning. And I copy uh a man called Amartya Sen
as you know Nobel prize winner in economics, he said for countries to succeed you need the invisible hand of free markets, right. Which is what the U.S. and U.K. have been focused on, but you also need the visible hand of good governance. So in all the sectors that you mentioned,
if you have very smart people in technology, and if you have very smart people in data, you must have equally smart people who are regulating this technology or regulating this data. Because if the guys are doing the data and technology are much smarter than the regulators, then they run circles around the regulators, and that's how they end up getting monopolies and
they steal the level playing field in their favor and so on and so forth. And so that's basically what the problem in the United States is. Because the regulators in the United States are not as smart as the people in Silicon Valley. And so the people in Silicon Valley
run circles around the regulators. And so it's very important, I mean the biggest strategic mistake that the United States made was to listen to Reagan's, Ronald Reagan's advice, he said, "Government is not the solution, government is the problem." So as you know the United States has been defunding, delegitimizing, demoralizing government
agencies and therefore like even the FDA and CDC performed badly in response to Covid-19. That's what happens when you attack government agencies and defund them and demoralize them. So we must learn from again to copy, we must learn that the countries that succeed, and frankly like Singapore has done that very well. We have the invisible hand of free markets, but our regulators are smarter than the people in the markets, and therefore they can make sure that the companies don't run, promote their own self-interest, and sometimes undermine the national interest. - Sure there is a structural
issue in some countries, right? From a compensation standpoint, right. The guys in the private enterprise are making a million dollars a year whereas the guys in the public enterprise are making twenty five thousand dollars a year. To compound that issue, you've got the
exponentiality of the problem in the private enterprise or private sector and you've
got the mere linearity of the solving capabilities or resolving capabilities within the regulatory framework. So it's pretty systemic, right? I think it takes
open-mindedness to fix this you know at the leadership level until such time that
gets fixed. I think you know we're going to be exposed.
- Yeah right. But I hope that
there are enough people in most societies who have actually made enough money and who can then devote part of their lives to also doing some public service you know. And there are ways and means of creating informal vehicles to bring in people who who are super smart in
the private sector. So for example, again copying from Singapore; every ministry, the minister will have a group of advisers, they're often from the private sector often making lots more tons of money, but who like the idea of doing some public service and
advising, and so there are people like that you can bring in and say, "Hey you know this sector very well, what's your advice to us? What what do you do and get?" Of course you make sure you balance, you get a variety of advisors not all those who think the same way or from one company and so on and so forth, then you can get ways and means of doing that. And
by the way when Singapore started off, the government salaries in Singapore were very low you know, and despite that they're lucky and we were just Singapore very lucky by accident we've got three brilliant men; Lee Kuan Yew, Goh Keng Swee, Rajaratnam who also very honest. Completely incorruptible. Just very bizarre. - Yeah it was a blessing.
- And their salaries did not go up until the 1990s. So when when Lee Kuan Yew became prime minister in 1959, his salary was the same as any developing country salary.
- Yeah, okay, alright. I'm gonna end this session with a few rapid fire questions.
- Sure. So you want short answers?
- Short answers or it can be long you know but the question will
be very quick. Mohammed Rafi or Amitabh Bachchan? - Mohammed Rafi.
- That's too easy, that's too easy. Okay I'II make it a little bit harder. - I love Mohammed Rafi, and the reason why my brain is functioning is because of Mohammed Rafi. - Okay, okay. I'm glad to hear that because you know I used to be a musician. The next one would be code of conduct for the resolution of the South China Sea or otherwise. - Code of conduct. I think that's something that China should try to reach an agreement with the ASEAN countries as quickly as possible because it is in China's national interest to do so. The South China Sea is the number one
weapon that the United States will use to embarrass China globally, and if China
can conclude a code of conduct with ASEAN, then the United States is going to shut its mouth on South China Sea.
- Great. The next one is you foresee ASEAN having its own currency?
- Zero chance.
- Okay. explain. I mean I'm with you, but I want you to articulate the answer.
- Absolutely zero chance. Because I think the big lesson that the ASEAN countries have learned from the European Union is that sometimes you can go too far in integrating yourselves, and the ASEAN countries are better off preserving their sovereignty, and then cooperating where there is
in their common interest to do so in most cases without sacrificing their
sovereignty. And of course if you have a common currency, you're gonna have a common monetary policy and a common fiscal policy, and you can no longer have budget deficits even in your in a major crisis. And so therefore it is not wise for ASEAN countries to give up their sovereignty for a common currency.
- Alright. This is going to be the second last rapid fire question. What is it that Singapore could have done differently? To make it better. I mean not that it's not
good, already it's great.
- The Singapore government has been very good in handling the hard
challenges faced by Singapore especially the economic challenges. The Singapore government has not been very good in handling the soft challenges that Singapore is facing like for example the question of a national identity and Singapore as you know is a multi-racial country; 75% Chinese, 15% Malay, 6-8% Indian like me. Until today we still talk about our ethnic
identities. At some point in time the tipping point will come, and the Singaporean will
say I'm a Singaporean first, an Indian second, you know. Therefore the common
Singaporean identity needs to flower and emerge. And for it to flower and emerge, it needs an enabling environment a greater diversity of voices richer how do you say production of literature; novels, poems, and so on so forth, you know. So that dimension of Singapore society, the softer side has not done as well as the harder side. And I think we should spend more time on the softer side.
- Alright. The last one, Man. how much longer do you think ASEAN will
have to wait to get its Nobel Prize? - It depends on whether or not you can
replace the Nobel Peace Prize committee and have an international committee, a jury to select the Nobel Peace Prize rather than a group of Norwegian gentlemen as I say primarily, gentlemen maybe some ladies there to select the Peace Prize. Because what's
happened is that it's becoming very clear that the 200 years artificial period
of western domination of world history is ending, and the 21st century will be an Asian century. So this idea that a group of old men or old people from one society can understand the Asian century and where the new success stories are coming from. I think it's a bit hard to believe. And I would say if there's one simple indicator that the Nobel Peace Prize committee can give that they have woken up to the new world, they should begin by showing the new understanding by giving ASEAN the Nobel Peace Prize sometime in the next 10 years.
- Wow on that note I'm hugely encouraged. Kishore, it's been fascinating,
and it's a pleasure and an honor to have you on our show. Thank you so much.
- My pleasure. Thank you very much for having me. That's Professor Kishore Mabubani, our close friend from Singapore. Thank you. [Voiceover: This has been Endgame]
