11.4% of the households in Singapore are millionaires

I just returned from a trip to Singapore. Up until a few months ago, I wouldn’t have been able to locate Singapore on a map, but I’ve always been interested in exploring this country which is often touted as having the highest percentage of millionaire households in the world—a whopping 11.4% of the households in Singapore are millionaires!

After coming home to Los Angeles, I can’t help but feel that America has already lost its place as the world’s most industrious and dominant superpower.

What factors have contributed to Singapore’s economic miracle over the last few decades? and what lessons can we learn from them?

Infrastructure

Singapore’s Changi Airport is frequently rated as #1 in the world (Hong Kong is usually a close second). The MRT system takes you everywhere you need to be. Taxis are everywhere and more affordable than New York cabs. Traffic isn’t that bad because the government taxes car ownership heavily (you have to pay $45,000 SGD for the right to buy a car). Singapore’s universal healthcare system is ranked among the highest in the world. Their legal system is based on the British common law system. Everywhere is ridiculously clean. The demographics are a colorful mix of Chinese, Indians, Malays, with the occasional western expat. People speak very good English and everyone is civil; I went to their New Years countdown party and was surprised how sober and orderly everyone was—if it had been in LA, there would have been drunks rioting and looting for sure!

Small business taxation

Small businesses and entrepreneurs like to setup shop in Singapore because they have especially friendly tax policies for startups. For qualifying startups, the first $100,000 SGD of profits are tax exempt for the first 3 years. Profits above that are taxed on a relatively low (by American standards) sliding scale. Any entrepreneur will tell you that getting the ball rolling is what makes or breaks you—Singapore welcomes corporations with open arms, and has put policies in place to help businesses succeed.

Public housing

Singapore has the most expensive real estate in the world. I learned that most Singaporeans live in public housing called HDB flats. In America, when we think of public housing, we think of “the projects,” Section 8 housing, slums, ghettos, etc. But HDB flats are affordable high-rise apartments with high quality finishes and responsible tenants. I don’t know exactly how it works, but somehow their government has been able to make it possible for its own citizens to live affordably and comfortably even though real estate prices are astronomical. This is definitely a model that other governments and policymakers should study.

Food and welfare

I’m fascinated by the hawker centre food culture in Singapore. Even though Singapore is regarded as an expensive place to live, the food is actually much cheaper and exponentialy tastier than what we are used to in America. A generous plate of Singapore’s world-famous Tian-Tian chicken rice goes for about $2.50. You can’t even get a big mac for $2.50 in America. I really admire how Singaporeans of all social classes and ethnicities can get together in an un-airconditioned hawker centre on a sweltering hot day and enjoy their meals together.

As we have seen by the recent food riots in Algeria, Tunisia, India, China etc, the lack of affordable food invariably leads to social unrest. America has yet to endure a food riot, but only because our domestic food problems are masked by food stamp programs, and food stamp usage is at an all time high. There is no doubt that if it weren’t for the welfare and food stamp entitlement programs, there would be rioting and looting all over the country. Singapore, on the otherhand, has no welfare entitlement programs because they advocate personal responsibility… and they seem to be doing fine.

Conclusion

Anyways, here I am, back home in LA. LAX is still a crummy 3rd-world airport. Unemployment is still up. Food is expensive. Gas is expensive. Millions are on welfare and food stamps. Many municipalities are rumored to go bankrupt this year. Unrest is starting to manifest itself.

Are we just going to sit here and let our standard of living go down the hole?