From Third World to First - book notes

Author - Lee Kuan Yew

Are you one of those people who can read a book once and remember every detail? In contrast, others struggle to recall even the central theme a few days after finishing. I am somewhere in the middle of the two extremes, which got me thinking about improving my reading, thereby remembering more so that I make better decisions. That's why I write book notes and store them in my Second Brain.

The following are my book notes for the amazing book, "From Third World to First". This is the first set of notes I have made public. These notes are extracts from the book (where it captured my interest and curiosity the most) along with bold italic text. Bold italic text is my observations and often unfinished thoughts and reflections. Added emphasis is mine throughout as well. My notes are 10k+ words long. The book condenses 30 years (1965-1995) into 700 pages and does a remarkable job.

Book notes don't replace the book - I recommend you go out and buy this book. It gives so much more context and meaning.

⚡ - Synopsis and main takeaways

LKY was the prime minister of Singapore for 30 years. He was their "prime squared minister", the first since independence from Britain and a failed merger attempt with the much larger country of Malaysia. He wrote this book for a younger generation of Singaporeans who took stability, growth, and prosperity for granted.

This book is his version of his 30+ years as prime minister. How he and his successive governments made a huge success of a small country of 640 square km with no natural resources and ultimately helped them thrive and not be dependent on the other larger countries nearby.

This is a book on how to build a nation. The ultimate founder?

✍ - Book notes

PART I - Getting the Basics Right

The first part of LKY's book was of the most interest to me as the themes focus on building something new, overcoming obstacles and challenging Western thinking. It is particularly relevant for founders, entrepreneurs, and leaders rebuilding or turning something struggling or failing around.

Chapter 1 - Going It Alone

LKY states that after pondering the major and pressing problems that a newly independent Singapore faced:

1 - To get international recognition for Singapore's independence, including membership in the UN.

2 - To defend their new state. They had no army. Their two battalions were under the control of a Malaysian brigadier.

3 - The economy. How to make a living for their people. Indonesia was standoff-ish. Malaysia, after the recent separation, wanted to bypass Singapore for trade.

4 - How was Singapore to survive when it was no longer the centre of the wider area that Britain once governed as one unit?

He concluded that an island city-state in Southeast Asia could not be ordinary if it were to survive. They had to make extraordinary efforts to become a tightly knit, rugged, and adaptable people who could do things better and cheaper than their neighbours (because their neighbours wanted to bypass them and render obsolete their role as the port city (entrepot) and middleman for the trade in the range).

Their greatest asset was the trust and confidence of the people.

The new government needed the political strength to maximise what use they could make of their few assets:

• A world-class natural harbour situated in a strategic location astride one of the world's busiest sea lanes.

• A people who were hardworking, thrifty and eager to learn.

• What about the English language?

To succeed, it was crucial to keep Singapore's multilingual, multicultural, multireligious society united and make it rugged and dynamic enough to compete in world markets.

Chapter 2 - Building an Army from Scratch

Singapore had to build a credible force to protect themselves - this was a short-term goal - that they had to resolve. Rather than focusing on longer-term aspirations.

At the same time, they challenged themselves to think strategically. They had to reorientate their population's minds to accept the need for a people's army and overcome their traditional dislike for soldiering. To achieve this, they set up national cadet corps and national police cadet corps in all secondary schools so that parents would identify the army and police with their sons and daughters. If they could change people's thinking and attitudes, they could raise a large citizen army like Switzerland or Israel. They gave themselves a decade to accomplish this.

• They established a national service for men and women (like Israel who, they modelled themselves where realistic)

• They also guaranteed jobs in the government, statutory boards or the private sector for those that enlisted as a full-time career.

• They identified their best officers for overseas scholarships.

National service had a profound impact on Singapore society over the 30 years. It has become a rite of passage for their young men and women and a part of their way of life that has helped to unify their people. They learn to live and work closely with each other regardless of race, language, or religion.

Singapore's limited size was a severe constraint. They had to find unconventional solutions to their problems.

A country's defence capability has to be continually upgraded as new technology is incorporated into weapons systems. This requires a sound economy that can afford to pay for new weaponry and highly educated and trained people who can integrate the various arms into one system and operate them efficiently and effectively.

Chapter 3 - Britain Pulls Out

Singapore badly needed the confidence British forces generated from being stationed there. If they were suddenly to leave before they could defend themselves, LKY didn't think they could survive. The British presence gave people a sense of security, without which Singapore would struggle to get investment or be able to export their goods and services. Both of which were essential to keep unemployment low. At that time, mid to late 1960's the contribution of British bases to the economy of Singapore was estimated to be 20% of GDP. Don't forget there was also a worry about communism in SE Asia (think Vietnam war etc.)

LKY invested considerable time to better understand British intentions and consequently counter the lobby for early withdrawal. His efforts focused on both the Conservative and Labour parties. LKY successfully got early access to British bases, bought equipment, and ensured the British didn't leave until the early 70's.

Chapter 4 - Surviving without a Hinterland

In 1965 there was no common market with Malaysia and confrontation by Indonesia. LKY feared unemployment would get to 14% and there would be social unrest. LKY's government used a Dutch economic advisor (Dr Albert Winsemius) who advised them to seek more favourable entry for Singapore manufactured goods in the US, UK, Australia and NZ. Winsemius played a crucial role as an economic advisor, serving for 23 years until 1984. He would visit twice a year, for about three weeks at a time. He would spend the first week speaking with officials, the next with executives from the large multinational companies investing in the country and the Singaporean ones, as well as union leaders. He would submit a report and recommendations to the minister of finance and LKY at the end of each visit. LKY would have a working lunch alone with him each time. Advisor, outside in perspective, independent sounding board, coach/mentor/consultant.

The future was bleak. They had been grappling with unemployment since 1959, confrontation by Indonesia continued, and Malaysia was still bypassing Singapore where they could.

One of their soft drink manufacturers suggested they promote tourism. It was labour-intensive (cooks, maids, waiters, guides, drivers etc.), and best of all, it required little capital. They formed the Singapore Tourist Promotion Board. Their efforts worked and helped reduce but not solve the unemployment problem.

To solve unemployment, they concentrated on getting factories started. It was an unpromising start. They had their fair share of failures, such as investing in water-intensive industries when short on water. In the early years, any factory was welcome.

The loss of the British military expenditure between 1968-1971 was a blow to the economy. It was ~20% of GDP, providing 30k jobs in direct employment and another 40k in support services. But Singapore was determined not to be aid dependent on Britain but rather emphasise the spirit of self-reliance.

The government sought the early handover of British military bases and buildings. Next, assistance should provide Singapore with jobs through industries and not make them dependent on perpetual injections of aid. LKY warned the workers

"The world does not owe us a living. We cannot live by the begging bowl."

After being in office for nine years and having settled policies to counter the loss of British spending, in 1968, LKY took a short sabbatical to recharge, get fresh ideas and reflect on the future. He went to Harvard. Continuous learning, best practices in other industries and regions, new contacts etc.

In LKY's first official visit to the US, he spoke about Singapore's philosophy of providing goods and services "cheaper and better than anyone else, or perish." The US audience responded positively to his "no begging bowl" approach. His meetings with US CEOs were successful because they looked for political, economic and financial stability and sound labour relations to ensure that there would be no disruption in production that supplied their customers around the world.

LKY crystalised his thoughts and settled on a two-pronged strategy to overcome their disadvantages:

First - was to leapfrog the region, as the Israelis had done. Since Singapore's neighbours (Malaysia and Indonesia) were out to reduce their ties with them, Singapore had to link up with the developed world - America, Europe and Japan - and attract their manufacturers to produce in Singapore and export their products to the developed countries.

The second - was to create a first-world oasis in a third-world region. If Singapore could establish first-world standards in public and personal security, health, education, telecoms, transportation, and services, it would become a base camp for entrepreneurs, engineers, managers, and other professionals who had business to do in the region. They had to train their people and equip them to provide first-world service standards.

They had one simple guiding principle for survival: Singapore had to be more rugged, better organised, and more efficient than others in the region. If they were only as good as their neighbours, there was no reason for a business to be based there. They had to make it possible for investors to operate successfully and profitably in Singapore despite their lack of domestic market and natural resources.

They created the Economic Development Board (EDB) in 1961, a one-stop agency so that an investor need not deal with many departments and ministries. This agency would sort out all an investor's requirements. The EDB was helped by their English-language education.

The government played a crucial role in attracting foreign investments. They built the infrastructure and provided well-planned industrial estates, equity participation in industries, fiscal incentives, and export promotion. Most importantly, they established good labour relations and sound macroeconomic policies, the fundamentals that enable private enterprises to operate successfully.

They welcomed everyone, but when they found a big investor with growth potential, they went out of their way to help it get started. Visiting CEOs used to call on LKY before they made their investment decisions. LKY thought the best way to convince them was to ensure that the roads from the airport to their hotel and his office were neat and spruce, lined with shrubs and trees. When they drove in, they would see right in the city's heart a green oasis, 90 acres of immaculate lawns and woodland, and a 9-hole golf course nestling between them. Without a word being said, they would know that Singaporeans were competent, disciplined, and reliable. Contrast this with the drive from JFK to Manhattan!

Chapter 5 - Creating a financial centre

Strong, robust, independent regulator (MAF) established a reputation for being thorough and uncompromising in admitting only financial institutions of repute.

Chapter 6 - Winning over the unions

In 1969, for the first time since before WW2, Singapore had no strikers or work stoppages. How did they do this?

LKY requested union leaders update their practices. He told the union leaders they must not kill the goose whose golden eggs were needed. The unions had been part of a political movement against the British. Political leaders including LKY had offered the workers the carrot of independence, and the promise must now be fulfilled. But to do so, they had to reestablish

1. Supervision

2. Discipline and

3. Working norms 

To drive efficiency.

The union practices forced employers to become capital-intensive, investing in expensive machines to get the work done with a minimum of workers. This created a small group of privileged unionised workers getting high pay and a growing band of underpaid and underemployed workers.

Singapore needed new attitudes, the most important of which was that pay must accord with performance, not time spent on the job.

The unions and workers were so shaken by separation and fearful of the prospect of British withdrawal that they accepted LKY's hard-headed approach. Never waste a good crisis.

LKY took care to meet the union leaders privately to explain his worries.

Besides getting rid of pernicious British-style trade union practices, the employers had to be fair to their workers if they wanted maximum effort from them. LKY told them (union leaders and employer leaders) that where the two sides were not in agreement on basic objectives, the result had been ruinous for the economy. He urged the employers to do their part so that the workers would put in their maximum effort to get maximum rewards, direct rewards in their wages and benefits, and indirect returns through government revenue by way of homes, health, education and social benefits.

Ultimately LKY built trust with both sides over long years of association, which helped transform industrial relations from one of militancy and confrontation to cooperation and partnership. For example, he encouraged union leaders to work with business leaders to introduce quality control circles, groups of workers who together put suggestions on how to improve work, save time and costs, and achieve zero defects.

Chapter 7 - A Fair, Not Welfare, Society

Initially, LKY believed in socialism, in fair shares for all. Later his government learned that personal motivation and personal rewards were essential for a productive economy. However, because people are unequal in their abilities if the marketplace determines performance and rewards, there will be a few big winners, many medium winners, and a considerable number of losers. That would make for social tensions because a society's sense of fairness is offended.

A competitive winner takes all society like colonial Hong Kong would not be acceptable in Singapore. To even out the extreme results of free-market competition, they had to redistribute the national income through subsidies on things that improved the earning power of citizens, such as education. Housing and public health were also desirable. But finding the correct solution for personal medical care, pensions, or retirement benefits took a lot of work. They decided on each matter in a pragmatic way, always mindful of possible abuse and waste. If they over (re) distribute by higher taxation, the high performers would cease to strive (or would leave). The difficulty was to strike the right balance.

LKY was troubled by the entirely urban electorate. He saw how voters in the city always tended to vote against the government of the day and was determined that Singapore's householders should become homeowners. Otherwise, he saw political instability in the future. A sense of ownership was vital for their new society which had no deep roots in a common historical experience.

The old colonial government had started the Central Provident Fund (CPF) as a simple savings scheme for retirement: 5% employee and 5% matched by the employer. As a pension scheme, it was deemed inadequate, so they decided to expand this compulsory savings scheme into a fund enabling every worker to own a home. 

Could we repurpose the NI payments that are kept track of here in the UK (by worker) and join with workplace pensions, SIPPS and ISAs? The UK and other western countries run giant unfunded Ponzi schemes that rely upon a birth rate above 2 children per family plus immigration to generate enough new workers and hence taxpayers to fund the retirement benefits of past generations. Western countries with some notable early problems, like Italy and Spain (also Japan), are not replacing their populations fast enough so expect population declines in the next 30-50 years. This situation is a slow-moving and visible train wreck. Could moving to individual schemes to pay for healthcare and retirement be the way forward to draw a line in the sand so the problem doesn't keep getting bigger, as opposed to the current approach of "kicking the can down the road" as this problem is too hard and large to try and solve?

They changed the CPF in 1968 and launched a revised home ownership scheme. Workers were allowed to use their accumulated CPF savings to pay the deposit for a home and service the mortgage.

LKY had discussed this plan with union leaders as it was necessary to fulfil the promise to the unions that every worker would be given the opportunity to own a home. LKY gave the CPF scheme his constant attention, making adjustments from time to time as market conditions affect wages, construction costs and the price of land.

Once workers got used to a higher take-home pay because of annual pay rises, LKY knew they would resist any increase in their CPF contributions that would reduce their spendable money. So, almost yearly, he increased the rate of CPF contributions, but such that there was still a net increase in take-home pay. It was painless for the workers and kept inflation down. The rate was raised from 5% to 25% contribution by 1984. This, therefore, was a 50% savings rate (along with the matching). It was later reduced to 40% (highlighting that it depends on economic conditions).

LKY was determined to avoid placing the burden of the present generation's welfare costs onto the next generation.

Another intractable problem was healthcare. LKY viewed the British belief that all people were equal and no one should be denied the best of medical services as idealistic but impractical and led to ballooning costs. The idea of free medical services collided with the reality of human behaviour.

• When free antibiotics were prescribed, patients took their medicine for two days, did not feel better and threw away the balance. They then consulted private doctors, paid for their antibiotics, completed the course, and recovered. Singapore implemented a small surcharge for attendance at outpatient dispensaries (to generate buy-in and hence commitment, which is missing when something is free and given to you).

• In 1977 they made all CPF members set aside 1% of their monthly income in a special account that could be used to co-pay medical expenses for themselves and their families (including grandparents, parents, spouses and children). This was gradually increased to 6% (I think this is called Medisave). An upper limit of $15k in 1986 was set and increased at regular intervals. Savings above the limit were transferred to the member's general CPF account.

LKY and his deputy's view was that generalised health insurance/provision was open to abuse, so making the individual responsible would reduce this risk. Singapore was determined to find its own solution. They wanted to provide good health services, with waste and costs kept in check by requiring co-payments from the user. Subsidies for health care were necessary but could be extremely wasteful and ruinous for the budget. This problem has existed for 30 or more years here in the UK. In 1990 they added optional health and employment insurance called MediShield.

They found that co-payments by patients did prevent waste. A patient in a government hospital pays fees subsidised at rates up to 80%, depending on the type of ward they choose. As incomes increased, fewer patients chose the lower-cost wards, which had the highest government subsidies and opted for wards with more comfort and lower subsidies - they had implemented a self-administered means test - rising incomes resulting in high Medisave savings made people feel wealthy enough to choose the better wards.

Another problem requiring a solution was retirement benefits/pensions when a worker became too old to work. LKY and his government viewed how America and Europe's systems work, where the pensions are paid for by the current taxpayers, as not the best solution. As we have seen before, LKY prioritised personal responsibility and not placing the burdens on future generations. They therefore decided that all workers should accumulate their own savings in the CPF for old age.

In 1978, they allowed the CPF to be used as a personal savings fund for investments. For example, they allowed people to use up to $5k of their CPF to buy public companies that IPO'd (SBS, the bus system initially). They encouraged the widest share of ownership so that profits would go back to the workers and the regular users of things such as public transport. The UK could do this for renationalised services such as water and rail. After the initial success, they opened up the CPF to allow investment in other things, funds, shares etc.

The CPF grew from 420k members in 1965 to over 2.8 million members worth $80 billion in 1998, excluding $80 billion withdrawn to pay for homes and investments in shares. Almost every worker carries their own pension fund. At death, the balance of a worker's CPF savings will be paid accordingly to the worker's written wishes without the delays and formality of applying to court.

To be clear: LKY's government and Singapore took a lot of flack from opposition parties and Western media for pursuing such "hard-hearted" policies. It was difficult to counter the seductiveness of welfare promises, especially as they needed time to build up substantial CPF savings and have many people own their homes. Only at that point would people not want their individual savings put into a common pool for everyone to have the same welfare "entitlement", own the same kind of home, or enjoy the same level of comfort in hospitals. How would a western government ever be given the time for this to "work"? To work a system like the CPF, an economy needs to have low inflation and interest rates above inflation rates (the CPF returns must >= to inflation). People must be confident their savings will not melt away through inflation or devaluation. In other words, sound fiscal and budget policies are a precondition for the success of the CPF.

LKY notes that when governments undertake primary responsibility for the basic duties of the head of a family, the drive in people is weakened. Welfare undermined self-reliance - people did not have to work for their families well-being. The government handout (funded by other taxpayers) became a way of life. The downward spiral is relentless as motivation and productivity reduce. People lose the drive to achieve because they pay too much in taxes (above 50%?). Then they became dependent on the state for their basic needs.

The CPF has made for a different society. People who have substantial savings and assets have a different attitude to life. They are more conscious of their strength and take responsibility for themselves and their families. They are not attracted to the "buffet syndrome", where, after paying a health insurance premium, you can consume as much in medical investigations and procedures as you or your doctor can think of.

The CPF has provided workers with a comprehensive self-financing social security fund without shifting the burden to the next generation of workers. It is fairer and sounder to have each generation pay for itself, and each person saves for their own pension.

There will always be the irresponsible or incapable, some 5% of Singapore's population. They will run through any asset, whether a house or shares. They tried hard to make them as independent as possible and not end up in welfare homes. More importantly, the government attempts to rescue their children from repeating the feckless ways of their parents. Help was available as a last resort which is opposite to a more liberal approach which actively encourages people to demand their entitlements, with no sense of shame, causing an explosion in welfare costs.

Chapter 8 - The Communists Self-Destruct

Communism was a regular and constant threat throughout the 1950s and 1960s. The chapter finishes with, "Despite ruthless methods where the ends justified the means, the communists failed, but not before destroying many who stood against them, and others who after joining them decided that their cause was mistaken."

Chapter 9 - Straddling the Middle Ground

LKY's People's Action Party (PAP) has won 10 successive general elections since 1959. It had not gone "flabby" or no longer capable of effective action. How did they do it? Initially, there were fearful clashes with the communists and then the Malay communists. Upon independence, they faced dire threats from Indonesia, confronting them and Malaysia bypassing them. This series of events forged a bond of trust between that generation of voters and the old-guard PAP leaders.

Their critics believed they stayed in power because they had been hard on their opponents. But LKY's view is that it is overly simplistic. If they had betrayed the people's trust, they would have been rejected. The PAP led the country out of the depths of despair in the 1960s into an era of unprecedented growth and development. They took advantage of the expansion in world trade and investments to move from Third World to First World standards in one generation.

To straddle the middle ground and win elections, you must be in charge of the political agenda. This can only be done by not being beaten in the argument with your critics. They complained that LKY came down too hard on their arguments. But wrong ideas have to be challenged before they influence public opinion and make for problems. Those who try to be clever at the expense of the government should be okay with LKY's replies being as sharp as their criticisms.

Overall sentiment and mood do matter (in politics and being successful and enduring), but the crucial factors are institutional and organisational networks to muster support.

One imperative for LKY was to confront directly those who accused him of corruption or misusing the power of his office. He has always met head-on all such allegations.

Chapter 10 - Nurturing and Attracting Talent

LKY, in his 1983 annual public address, said, "It was stupid for our graduate men to choose less-educated and less-intelligent wives if they wanted their children to do as well as they had done." The press named it "The Great Marriage Debate." OMG!

To put this outlandish comment into context, LKY's strong view was that talent is a country's most precious asset. And for a small resource-poor country like Singapore, with only 2 million people at independence in 1965, it is the defining factor.

LKY had realised that the more talented people he had as ministers, administrators, and professionals, the more effective his policies were and the better the results. An obvious statement, but do our main political parties really get this as it seems unlikely that the UK political parties attract the best talent to help them run the country, let alone their own parties effectively.

LKY goes on to explain why he "poked the hornet's nest" to create this debate. The 1980 census figures. They showed that Singapore's brightest women were not marrying and would not be represented in the next generation. He felt the implications were grave. Our best (smartest/highest IQ?) were not reproducing themselves because men who were their educational equals did not want to marry them. About half of their university graduates were women, and nearly two-thirds were unmarried. The "Asian man" preferred to have a wife with less education than himself. Only 38% of graduate men were married to graduate women in 1983. In addition, the number of children for university-educated women was <2 but >4 for uneducated women.

LKY was not going to allow this lopsided marriage and procreation pattern to remain unmentioned and unchecked, so decided to shock the young men out of their damaging prejudices. He was attacked from all sides. He shared the data from the 1960s, 70s, and 80s so everyone could have the same information.

They set up the new Social Development Unit (SDU) along with the Social Development Section (SDS) of the People's Association to help and encourage graduate matches. They faced severe headwinds internally and were ridiculed from abroad. But traditional methods of choosing marriage partners had been ruptured by universal education. The government had to provide alternatives to the family matchmakers of old.

Graduate women were incentivised to have more than 2 children by giving them the choice of the best schools. They subsequently removed this privilege (experiment, not get the desired result, try something different). Instead, they gave special income tax concessions to educated, married women to incentivise more children. Our tax systems are there to raise money but also influence our behaviour, e.g. mortgage tax relief, child benefits etc in the UK.

Since the 1983 speech, LKY has continued to regularly release the statistical analysis of parents' educational backgrounds of the top 10% of students in national examinations. Singaporeans now accept that the better educated and the more able the parents, the more likely the children are to achieve similar results. His 1983 speech was intended to shake up Singapore's young men and women and their parents. The open discussion it stimulated made some difference.

Subsequently, the difficulties with the talent pool were aggravated when the rich Western countries began to encourage Asian immigrants. LKY discussed the topic of experiencing a "brain drain" with his counterparts, such as the Malaysian PM, in the 1970s. Therefore they formed two new committees in 1980 to place Asian immigrant entrepreneurs, professionals, artists and highly skilled workers. They concentrated on recruiting Asia students because Singapore offered an Asia society with a higher standard of living and quality of life than their own countries, and they could assimilate quickly into the society.

Without foreign talent, Singapore would not have done as well. (In LKY's first cabinet of 10, he was the only one born and educated in Singapore.) The thousands of engineers, managers and other professionals who came from abroad helped them to grow. They are the extra megabytes in Singapore's computer. "If we do not top up with foreign talent, we will not make it into the top league."

Chapter 11 - Many Tongues, One Language

Singapore never had one common language. The British left people to decide how to educate their children. When Singapore first became independent, they realised that English had to be the language of the workplace and the common language. They would not make a living as an international trading community if they used Malay, Chinese, or Tamil. With English, no race would have an advantage. The greatest gift from British colonial rule? However, it was viewed as too sensitive an issue to make immediate changes, so they initially left four official languages - Malay, Mandarin, Tamil, and English.

Not wanting to start a controversy over language, they introduced the teaching of three mother tongues, Mandarin, Malay and Tamil, into English schools. This was well received by all parents. To balance this, they also introduced the teaching of English in Chinese, Malay and Tamil - also well received, with the exception of a hard core of the Chinese educated. There were protests (encouraged by the Chinese Chamber of commerce) and students protested and even clashed with the police. LKY says, "After I deported the leaders of the two demonstrations, student agitation diminished." Interesting approach …firm, no messing.

However, the opposition to English as one common language was unremitting (by this hard-core element). LKY had a favourable view of the best features of Chinese education - vitality, dynamism, discipline, and social and political commitment of the students in contrast to the apathy, self-centeredness, and lack of self-confidence of the English-educated students. The crux of the problem was that English was the only acceptable neutral language besides being the language that would make Singapore relevant to the world.

Bilingualism in English and Malay, Chinese, or Tamil is a heavy workload for their children. The three mother tongues are entirely unrelated to English. But without English, Singapore would not make a living in the world. But becoming monolingual with English would have been a setback in other ways as they would have lost their cultural identity. Despite setbacks and criticism, English as a working language has prevented conflicts from arising between Singapore's different races and given them a competitive advantage because it is the international language or business and diplomacy, of science and technology. Without it, Singapore would not have many of the world's multinationals and top banks in Singapore. Nor would their people have taken so readily to computers and the internet.

Chapter 12 - Keeping the Government Clean

LKY's team were sickened by the greed, corruption, and decadence of many Asia leaders. Fighters for freedom for their oppressed people had become plunderers of their wealth. Their societies slid backwards. This was seen more broadly, such as by customs officials, traffic officers etc.

"Petty power invested in men who cannot live on their salaries is an invitation to misuse that power."

Upon taking oath, even before independence, they had a deep sense of mission to establish a clean and effective government. All LKY's ministers were university educated (one exception) and were confident of getting by out of office - there was no need to put by something extra in case that happened. More important, most had working spouses who could support the family if they were imprisoned or not around. This helped shape the attitudes of the ministers and their spouses.

When ministers commanded the respect and confidence of the people, public servants could also hold their heads high and make decisions with confidence. It made a critical difference.

The principal agency charged with rooting out corruption was the Corrupt Practices Investigation Bureau (CPIB). LKY's government directed the CPIB's priorities

• Focusing on the higher echelons

• For the "smaller fish", they simplified procedures and removed discretion by having clear published guidelines and even removing the need for permits and approvals in less important areas. They tightened the law in stages. (Like Netflix's culture where they "reduce controls")

The most effective change made (in 1960) was to allow the courts to treat proof that an accused was living beyond his or her means or had property his or her income could not explain as corroborating evidence that the accused had accepted or obtained a bribe.

With the power to investigate every officer and every minister, the director of the CPIB, working from the Prime Minister's Office, developed a formidable reputation.

This type of federal agency would be essential should the UK devolve substantial powers to the regions of England + Wales + NI + Scotland for them to be held accountable. The accountability of our UK politicians is shockingly absent, and their self-policing is weak, and the monitoring by the press (think party gate during COVID "lockdowns") is either too slow or absent.

"Human ingenuity is infinite when translating power and discretion into personal gain."

Rather than normalising corruption (definition is … dishonest or fraudulent conduct by those in power, typically involving bribery.") Singapore had established a climate of opinion that looked upon corruption in public office as a threat to society. We could use that here in the UK - especially a robust federal agency that starts at the top with ministers, MPs, lords and mayors to publicise and stamp out the translation of power into personal gain.

CORRUPTION PERCEPTIONS INDEX: https://www.transparency.org/en/cpi/2021

Singapore is ranked 4th highest in the world. UK is 11. US is 27.

A precondition for an honest government is that candidates must not need large sums of money to get elected. The bane of most countries in Asia has been the high cost of elections. Having spent a lot of money to get elected, winners must recover their costs and accumulate funds for the next election cycle. The system is self-perpetuating.

Singapore has avoided the use of money to win elections. Voting is compulsory.

Western liberals have argued that a completely unfettered press will expose corruption and make for a clean, honest government. Yet uninhibited and freewheeling press and television in India, the Philippines, Thailand, Taiwan, South Korea and Japan have not stopped the pervasive and deeply embedded corruption in these countries. Who owns the press? What are their hidden motives?

LKY's first group of ministers were unique in that they established independence and put themselves at personal risk. Their successors would not replicate this as the conditions are now vastly different. Ministers become one as one of many career options, and often not the most attractive one. Suppose you underpay people of quality as ministers. In that case, you cannot expect them to stay long in office earning a fraction of what they could outside. The remuneration of politicians in the West hasn't kept pace with their economic growth (still hasn't). Most successful people in the US or UK are too busy and doing too well to want to be in government.

Chapter 13 - Greening Singapore

After independence, LKY searched for a dramatic way to distinguish Singapore from other third-world countries. He settled for a clean and green approach. If they had first-world standards, then business people and tourists would make them a base for their business and vacations.

The physical infrastructure was easier to improve than the rough and ready ways of the people. They worked hard to eliminate littering, noise nuisance, and rudeness, and get people to be considerate and courteous.

The key to removing petty crimes such as illegal street sellers and pirate taxi services being banished from the roads was to improve the bus services and provide the people with alternative employment. They licensed the cooked food hawkers from the streets to properly constructed centres with water, sewers and garbage disposal. It seems a logical approach and key to solving nuisance crimes more broadly.

To achieve first world standards in a third world region, they set out to transform Singapore into a tropical garden city. They planted millions of trees, palms and shrubs. Greening raised the morale of people and gave them pride in their surroundings. They taught them to care for and not vandalise the trees. They did not differentiate between middle-class and working-class areas.

Perseverance and stamina were required to fight old habits: people walked over plants, trampled on grass, despoiled flowerbeds, pilfered saplings, or parked bicycles or motorcycles against larger ones - knocking them down. To overcome the initial indifference of the public, they educated their children in schools by getting them to plant trees, care for them, and grow gardens - they brought the message home to their parents. So true and can be a force of good for so much more, e.g. basic house finance is another area.

Being courteous and friendly to foreign visitors and also to each other was a focus from 1971. The ministries of defence and education, along with unions, were encouraged to spread the word that courtesy must be their way of life, to make Singapore a pleasanter place for them, quite apart from the tourist trade.

One compelling reason to have a clean Singapore was their need to collect as much of their rainfall of 95 inches per year as possible. The plan took ten years to implement. They had to ensure all sewage, sullage and other soiled water from homes and factories emptied into the sewers. Only the clean water runoff from the roofs, gardens and open spaces was allowed into the open drains that flowed into the damned rivers. As part of this, they had to move unlicensed food hawkers and the rearing of 900k pigs on 8k farms because the waste polluted the streams. A resettlement unit assisted and this was a hazardous political task that unless carefully and sympathetically handled would lose them voters in the next election.

Noise pollution was also tackled.

From the 1970s, Singapore banned all advertising for cigarettes. Progressively they banned smoking from all public places - elevators, buses, Mass Transit trains and stations, and eventually all air-conditioned offices and restaurants. In the 1990's they banned chewing gum because of the mess and cost of cleaning it up - which attracted much ridiculing of being a nanny state from the western media.

Singapore would have been a grosser, ruder, cruder society had they not made these efforts to persuade their people to change their ways. They did not initially measure up as a cultivated, civilised society and were not ashamed to set about trying to become one in the shortest time possible.

1. First they educated and exhorted their people

2. After they had persuaded and won over a majority

3. They legislated to punish the willful minority.

Chapter 14 - Managing The Media

LKY's early experiences in Singapore and Malaysia shaped his views about the claim of the press to be the defender of truth and freedom of speech. The freedom of the press was the freedom of its owners to advance their personal and class interests. So true! For example, the leading English paper, the "Straits Times", became vehemently anti-PAP as they approached their first general election for a self-governing Singapore. The paper was being run for British interests.

It was the PAP's declared policy that newspapers should not be owned by foreigners. The point being LKY tolerated locally owned newspapers that criticised his government and their policies; he accepted their bona fides because they had to stay and suffer the consequences of their policies. How does this work now with the internet and global social platforms?

LKY, at the 1971 International Press Institute assembly in Helsinki, said he did not accept that newspaper owners had the right to print whatever they liked. Unlike Singapore's ministers, they and their journalists were not elected. Freedom of the press, and freedom of the news media, must be subordinated to the overriding needs of Singapore and to the primacy of purpose of an elected government.

LKY did not subscribe to the Western practice that allows a wealthy press baron to decide what voters should read day after day.

Think of the following here in the UK and US - all owned and directed by individuals, families or unaccountable boards. One never finds the few remaining investigative journalists delving into their owner's motives and influences … obviously.

• NYT - Ochs-Sulzberger family

• Washington Post owner - Jeff Bezos

• The Daily Telegraph - Barclay brothers

• The Times - Murdoch

• The Guardian - Guardian Media Group - The Scott Trust

In the 1980s, Western-owned English language publications became a significant presence in Singapore. Singapore has always banned communist publications, which no Western media organisations have ever protested. They had never banned any Western newspaper or journal. Yet they repeatedly refused the government the right to reply when they misreported them. In 1986 they decided to enact a law to restrict the sale or distribution of foreign publications that had engaged in the domestic politics of Singapore. How does this work today? One of the tests they applied was whether, after they had misreported, they refused to publish the Singaporean government's reply. There was no ban but a restriction on the number of copies sold.

In 1986 the US State Department expressed regret that AWSJ had restricted sales because of this law. But when pressed, the state department said it did not take sides. It was merely expressing concern because of its "fundamental and long-standing commitment to the principles of a free and unrestricted press" - which meant that "the press is free to publish or not publish what it chooses however irresponsible or biased its actions may seem to be."

In 1987 an American-owned publication was challenged as to why they published an article based on statements of a person not present at the meeting (in question) without checking with the two principal attendees. The editor's response was that a newspaper could legally print anything it wished, true or false, as long as it was able to quote a source who had actually made the statement. It was under no obligation to check its facts to satisfy itself as to the truthfulness of its source, or to verify the assertions with other witnesses, nor could it be held answerable for any lies and libels thereby published. I wonder how many readers truly appreciate that this is what journalism largely is today. Someone said something, therefore write about it.

At the end of the chapter LKY states that advances in technology will allow Western media to saturate their domestic audience with their reports and views. Countries that try to block the use (social platforms and internet more broadly) will lose. Singapore has to learn to manage this relentless flood of information so that the Singapore government's point of view is not smothered by the foreign media. They must work out ways to ensure that amid this cacophony of voices, that of the Singapore government is heard. It is important for Singaporeans to know the official position of their government on major issues.

Chapter 15 - Conductor of an Orchestra

LKY and his ministers remained friends and colleagues for 3-4 decades. Their commitment to a common cause and to each other was deep. (Think The 5 Dysfunctions of a Team and The Wisdom of Teams - most governments are likely groups rather than teams.) They had abiding political convictions, which enabled them to risk challenging the British, and the communists at the same time.

The 5 Dysfunctions of Teams

1. Absence of Trust

2. The Fear of Conflict

3. Lack of Commitment

4. Avoidance of (peer-to-peer) Accountability

5. Inattention to (collective) Results

Any differences in policy were kept within the cabinet until they had resolved them and reached a consensus. Then they would put forth a clear line which people could understand and accept. Once a decision had been made in the cabinet, "we made a point of abiding by it."

If only this happened here in the UK, or more broadly in business. Dysfunction #3 - Disagree and Commit.

Running a government is not unlike conducting an orchestra. No prime minister can achieve much without an able team. While he himself need not be a great player, he has to know enough of the principal instruments from the violin to the cello to the French horn and the flute, or he would not know what he can expect from each of them.

LKY's approach was to put the best person in charge of the most important ministry at that period, usually, finance. The next best would get the next most important portfolio. LKY would tell the minister what he wanted them to achieve and leave them to get on with the task - it was management by objective. This strikes a consistent tone with the Scorecard from the book "Who: The A Method for Hiring" with 1) The Mission being the manifesto the government were elected on, 2) the Outcomes being what LKY told the minister he wanted to achieve, 3) the Competencies being how one assess the best person for that position. LKY had regular meetings to review and catchup, with interventions necessary at times. Ultimately, responsibility for a government's failure rests with the prime minister.

Some examples of how the government supported and pushed for change and central insights into how they went about doing so:

Singapore Airlines at Changi Airport  LKY spelt out to all union leaders and top management the need for Singapore Airlines to be competitive and self-supporting. It would close down if it incurred losses. Singapore could not afford to run an airline just to show the flag as other countries did. From the beginning, management and unions understood that their survival depended on profitability. Cooperation between unions and management helped Singapore Airlines succeed.

Fighting Traffic Congestion - By trial and error, LKY learned that if he wanted to get an important proposal accepted at all levels, he should first float his ideas with his ministers (challenge group), who would then discuss them with the permanent secretaries and officials. After he received their reactions, he would have the proposal discussed amongst those who had to make it work. If like the transport system, it concerned large numbers of people, he would then get the issue into the media for public discussion. Hence, before they decided on an underground MRT, they had a public debate for a year on the merits of an MRT versus an all bus system. Note the order - Media is later, not leaked at the start. Seems like a good approach and relevant for something like CBDCs. The decision shouldn't be final until after the public concerns have been raised and where possible, addressed.

Delicate Malay Issues - In the 1980s, they created Group Representative Constituencies (GRCs) to amalgamate three or four single-member constituencies. These were contested by teams, which had to include one candidate from a minority community (Chinese, Indian or Malay depending on each GRC). This was largely to stop people voting for the candidate who spoke the same dialect or language and was of the same race, hence minority races never being elected.

Rule of Law - Singapore got rid of the jury system. Many Asian jurors were reluctant to take responsibility for severe punishments and so were more reluctant to convict. Therefore jury trials were abolished.

Small Steps Toward IT - LKY was an early enthusiast for the use of computers, which became an important factor in increasing Singapore's productivity. In 1984 he decided that all government employees would be paid electronically against many objections.

A Chief Justice, A President - LKY describes his success in hiring his successor and a chief justice but acknowledges his mistakes with the president. His chief justice turned out to be outstanding. He gave leadership to the judges and set a high tone for the bar. He reformed and updated the courts and their procedures and reduced the backlog and the delays in cases awaiting trial. He amended the rules and practices that lawyers took advantage of to procrastinate and postpone their cases. To cope with the increased litigation, he recommended the appointment of additional judges. His selection methods were systematic and fair. Their first president was, unfortunately an alcoholic and so was quickly asked to resign.

PART II - In Search of Space - Regional and International

This section was of less interest to me. Mainly because so much of it was historic meetings and names. My book notes for this section are, therefore, sparse compared to Part I. But still, there were several important insights that I took from it, such as the importance of (local) international diplomacy (security, trade and peace) in ASEAN.

Chapter 16 - Ups and Downs with Malaysia

Not spending more than Singapore collects in revenue has been a guiding principle from which no Singapore finance minister has departed except in a recession. (or war)

Malaysia forced Singapore to become more competitive.

They made Singapore repeatedly reexamine their competitiveness, improve its infrastructure, and work smarter to increase its productivity.

Chapter 17 - Indonesia: From Foe to Friend

At all the meetings between the PMs, they would always make time to meet empat mata (two people, behind closed doors), when they could have uninhibited free-ranging discussions, and LKY would test out ideas which his counterpart could reject without any embarrassment.

Chapter 18 - Building Ties with Thailand, the Philippines, and Brunei

Chapter 19 - Vietnam, Myanmar, and Cambodia: Coming to terms with the Modern World

Chapter 20 - Asea - Unpromising Start, Promising Future

Chapter 21 - East Asia in Crisis 1997 - 1999

Chapter 22 - Inside the Commonwealth Club

LKY, when discussing with (mainly) African leaders, thought it was unhelpful to talk in terms of racist divisions between white settlers and immigrants. Like the peoples in Canada, Australia, and New Zealand, "I was a settler". If all immigrants were racists, then the world was in for a difficult time. There were two alternative solutions to the problems created by migrations that had taken place all around the world: either accept that all people had equal rights, or to return to the rule of the strong over the weak. For coloured peoples of the world to demand retribution for past wrongs was not the answer to survival.

LKY was not optimistic about Africa. In less than 10 years after independence in 1957, Nigeria had had a coup and Ghana a failed coup. LKY thought that their tribal loyalties were stronger than their sense of common nationhood.

To rally their people in their quest for freedom, the first-generation anticolonial nationalist leaders had held out visions of prosperity that they could not realise. A population explosion had increased the burden on resources. Interethnic peace, which the colonial overlord had enforced, was difficult to maintain after independence with power in the hands of an ethnic majority.

The countries suffered as their ethnic minorities were squeezed out by rioting or legislation.

The layer of trained people was too thin, and new states reverted back to type as soft societies without the firm hand of an overlord and a strong framework of administration. Corruption set in and became a way of life. Military coups made things worse. But most of all, most governments had favoured economic planning and controls, which stifled free enterprise.

The African presidents whose countries were then better off wasted money on presidential aircraft. LKY wondered why they did not set out to impress the world that they were poor and in dire need of assistance. Singapore's permanent representative at the UN in NY explained that the poorer the country, the bigger the Cadillacs they hired for their leaders. So LKY made a virtue of arriving by ordinary commercial aircraft and thus helped preserve Singapore's Third World status for many years.

Chapter 23 - New Bonds with Britain

LKY's view was that welfarism, introduced by the Labour Party in the 1940s, and sustained by the Conservatives in a bipartisan consensus, had blunted the British people's motivation to exert themselves and excel, at the expense of the economy. Most leaders in the main parties were aware of the debilitating effects of welfarism. Still, no one tackled this problem until Margaret Thatcher became PM.

Chapter 24 - Ties with Australia and New Zealand

Chapter 25 - South Asia's Legends and Leaders

India has so many outstanding people in so many fields of scholarship, but for a number of reasons it has allowed the high standards the British left them to be lowered. There is less insistence now on meritocracy by examinations for top schools. Cheating at examinations is rampant. Universities allot their quota of places to MPs of their state, who either give or sell these places to constituents.

Perhaps the fault lies in the system. India has wasted decades in state planning and controls that have bogged it down in bureaucracy and corruption. A decentralised approach would have allowed more centres like Bangalore and Bombay to grow and prosper. Another reason could be their caste system. It has been the enemy of meritocracy - each caste demands its quota in all institutions. A third reason is the endless conflicts and wars with Pakistan that make both poorer.

Chapter 26 - Following Britain into Europe

Chapter 27 - The Soviet Union: An Empire Implodes

Chapter 28 - America: The anticommunist anchorman

Chapter 29 - Strategic accord with the US

Chapter 30 - America's New Agenda

Asian versus Western debate: LKY instead refers to Confucian (not Asia) values, the values that prevail in the cultures of China, Korea, Japan, and Vietnam, countries that used the Chinese script and have been influenced by Confucian literature.

There is no Asia model as such, but there are fundamental differences between East Asian Confucian and Western Liberal values. Confucian societies believe that the individual exists in the context of the family, extended family, friends, and wider society, and that the government cannot and should not take over the role of the family.

Many in the West believe that the government can fulfil the family's obligations when it fails, as with single mothers. East Asians shy away from this approach. Singapore depends on the strength and influence of the family to keep society orderly and maintain a culture of thrift, hard work, filial piety, respect for elders, scholarship, and learning. These values make for a productive people and help economic growth.

LKY stressed that freedom could only exist in an orderly state, not when there was continuous contention or anarchy. In Eastern societies, the main objective is to have a well-ordered society so that everyone can enjoy freedom to the maximum. Parts of contemporary American society were totally unacceptable to Asians because they represented the breakdown of civil society with guns, drugs, violent crime, vagrancy, and vulgar public behaviour. America should not impose its system indiscriminately on other societies where it will not work.

LKY stated in a 1994 interview in Foreign Affairs that many of the social problems in the US were the result of the erosion of the moral underpinnings of society and the diminution of personal responsibility.

American liberal academics began to criticise Singapore for their attitudes to the Western press circulating in Singapore. They were not following their pattern for development and progress, that as a country developed its free market economy and enjoyed prosperity, it should become more like America - democratic and free - with no restrictions on the press. Because Singapore does not comply with their norms, American liberals will not accept that the government, which Singaporeans have repeatedly voted for, can be good.

History teaches us that liberal democracy needs economic development, literacy, a growing middle class, and political institutions that support free speech and human rights. It requires a civic society resting on shared values that make people with different and conflicting views willing to cooperate with each other. In a civic society, between the family and sate, there are whole series of institutions to which citizens belong, voluntary associations to promote specific common interests, religious institutions, trade unions, professional organisations, and other self-help bodies.

Democracy works where the people have that culture of accommodation and tolerance which makes a minority accept the majority's right to have its way until the next election, and wait patiently and peacefully for its turn to become the government by persuading more voters to support its views.

Chapter 31 - Japan: Asia's First Miracle

Chapter 32 - Lessons from Japan

Chapter 33 - Korea: At the crossroads

Chapter 34 - Hong Kong's Transition

Chapter 35 - Taiwan: The Other China

Chapter 36 - China: The Dragon with a Long Tail

Chapter 37 - Deng Xiaoping's China

Chapter 38 - China Beyond Beijing

LKY, during the 1980s and 1990s, visited China almost every year to better understand its leader's motivations and ambitions for China.

Every province in China is different in geography, economy, education and standard of efficiency.

Chapter 39 - Tiananmen

Chapter 40 - China: To be rich is Glorious

Part III - Winding Up

Chapter 41 - Passing the baton

Hand over of power and choosing to go on your terms.

The single decisive factor that made for Singapore's development was the ability of ministers and the high quality of the civil servants who support them.

Because of Singapore's relentless and unceasing search for talent both at home and abroad to make up for the small families of the well-educated, Singapore has been able to keep up its performance. Their greatest task was to find the people to replace LKY's ageing ministers and himself.

LKY wanted to avoid being found wanting in finding their replacements. His government set out to recruit the best into government. The problem was to persuade them to enter politics, get themselves elected, and learn how to move and win people over to their side. It was a slow and challenging process with a high attrition rate. Successful, capable professionals and executives are not natural political leaders, able to argue, cajole, and demolish the arguments of opponents at mass rallies, on television and in Parliament.

LKY systematically scanned the top echelons of all sectors in Singapore - the professions, commerce, manufacturing, and trade unions - to look for men and women in their 30's and 40's whom they could persuade to stand as their candidates. Ability can be assessed fairly accurately by a person's academic record and achievement in work. Character is not so easily measured. After some successes but too many failures, LKY concluded that it was more important, though more difficult, to assess a person's character.

They put prospective PAP election candidates who had the potential to be ministers through psychological tests designed to define their character profile, intelligence, personal backgrounds, and values. These tests were not conclusive but they helped to eliminate the obviously unsuitable and were an advance on gut reactions during a two-hour interview. I can see how Hogan might be used here, thinking of the HDS derailers such as mischievous and moving against people cluster. But the suite as a whole HPI, HPS, and MVPI could be very helpful.

Chapter 42 - My Family

Chapter 43 - Epilogue

LKY and his governments never stopped learning because the situation kept on changing and we have to adjust our own policies.

LKY's colleagues forged their camaraderie under intense pressures. In successive crises, they had to put their lives in each other's hands. They trusted each other. They knew each other's strengths and weaknesses and made allowances for them. Trust is like salt, it makes everything better.

They did not take any straw polls to tell them what popular sentiment wanted them to do. Their task was to swing the people around to support what had to be done so that Singapore could survive as a noncommunist, noncommunal, viable society.

They learned on the job and learned quickly. If there was one formula for their success, it was that they were constantly studying how to make things work or how to make them work better. LKY was never a prisoner to any theory. What guided LKY was reason and reality. The acid test he applied to every idea or scheme was, would it work? This was the golden thread that ran through his years in office. If it did not work, or the results were poor, LKY would not waste more time and resources on it.

LKY discovered early in office that there were few problems confronting him in government that other governments had not met and solved. So he made a practice of finding out who else had encountered the problems they faced, how they had tackled them, and how successful they had been. He would send a team to visit and study those countries that had done it well. LKY preferred to climb on the shoulders of others who had gone before.

LKY learned to ignore criticism and advice from experts and quasi-experts, especially academics in the social and political sciences. They have pet theories on how a society should develop to approximate their ideal, especially how poverty should be reduced and welfare extended. No skin in the game!!