Freedom

What Does It Mean When Wealth Flees Democracies for an Authoritarian City-State?

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Singapore
Eustaquio Santimano

It's probably not news to anybody who followed the soap opera over Eduardo Saverin's renunciation of U.S. citizenship or who knows that Jim Rogers decamped with his family from the land of the free, but Singapore has become a haven for wealth. The Wall Street Journal has a fascinating piece up on just why that is — why people are flocking to the city-state to maintain current fortunes or to make new ones. The Journal's Shibani Mahtani compares Singapore's magnetic attraction for wealth to the Gilded Age, and it's true New York City and London were once centers of wild and flamboyant prosperity just like the city-state is today. But the United States and United Kingdom of the 1880s were centers of increasing democracy and personal freedom in both the civil and economic spheres — certainly by contrast to the alternatives. By contrast, Singapore of today is known as a not-so-democratic state where civil liberties are kept in sharp check. That these qualities seem to be the draw should be of concern to anybody who thinks that free elections and open debate should offer a better path to the future than one-party rule.

As Mahtani writes:

But what really checks all the right boxes for many of the world's ultra-rich is Singapore's obsession with order, predictability and control, all of which give comfort to individuals whose fortunes have recently gone down the drain in many parts of the world. It doesn't hurt that Singapore has some of the lowest taxes in the world, including none on capital gains and most foreign dividends. But it also has relatively secretive private banking laws and zero harassment from paparazzi or protesters, whose activities are narrowly proscribed by Singaporean authorities, further creating an aura of order and stability. Ronen Palan, a professor of international political economy and an expert on offshore wealth and tax havens at City University in London, believes that while Switzerland is "clearly suffering" from the pressure put on its private-wealth sector from the European Union and the U.S., Singapore is a "very secretive location" where many—Asians in particular—believe their wealth will be spared scrutiny from Western regulators.

It's worth emphasizing that authoritarianism in and of itself isn't an attraction. Mahtani points out "[t]he Chinese alone are reportedly exporting billions of dollars, saying they no longer trust their government and want to put their money elsewhere." The Singapore regime is seen as trustworthy and respectful of economic freedom even as it clamps down otherwise. So money flows there from unpredictable authoritarian regimes, "rambunctious—and some say, corrupt—democracies" like India and Indonesia, and also established democracies like those in Europe and North America that are seen as high-tax, overregulated and no longer welcoming to business and wealth creation.

America's tax laws have made it increasingly unattractive for people with jobs and business interests around the world to remain U.S. citizens. And France has made itself an international laughingstock by pushing euros and wealthy citizens toward the exit. Many of the world's best-established democracies seem to have lost the knack for allowing their citizens to build and enjoy prosperity.

That doesn't mean that Singapore is necessarily the anointed successor. Mahtani points out that Singapore's political leaders are under pressure from citizens to build more of a tax-hungry welfare state, and from other countries to compromise the city-state's status as a wealth haven.

But, for now, money and moneyed people are flowing out of relatively free democracies that used to excel at encouraging economic opportunity along with civil liberty and into an authoritarian enclave that bans chewing gum and muzzles the press — but allows considerable economic freedom. That's an unpleasant commentary on the road down which democratic governments have wandered, and it can't be a good sign for the future.

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  1. Singapore is authoritarian, definitely. But is it really “not so democratic?” I’m not sure. I think that the People’s Action Party wins elections repeatedly pretty fairly.

    1. I think that the People’s Action Party wins elections repeatedly pretty fairly.

      Yes they do. They have held power since 1963. But they have done a bang-up job for the country.

      1. People’s Action Party

        Yes, and anybody that comes out against them will get PAP smeared.

        1. Really? You people know how hard it is to come up with a legit pap smear joke and you all just walk on by.

          [sob]

          I don’t even know H&R anymore.

          1. Sorry, sloopy, your joke was clearly just pap designed to go down well with these fools. I mean us fools.

  2. Wealth can buy civil liberties or at least enough cover to exercise them.

    1. Get a load of mister class envy over here. Go occupy something, hippie.

    2. Exactly. Somehow I doubt that a billionaire has to worry about the Singapore authorities coming down on him for chewing gum.

      People with a ton of money can buy the same cover in the US, but will have vastly more of their money stolen from them. Why wouldn’t they choose Singapore?

      1. Why wouldn’t they choose Singapore?

        Because you’re a piece of shit? I dunno, I’m just spitballing here.

        1. It’s a fair cop. Coprophilia, that is!

          1. I feel like that should count as a pun, for purposes of you hating yourself, but not for purposes of me thinking puns are awesome.

            1. It’s not a pun, it’s a reference to JJ calling me a piece of shit. Why am I not surprised you couldn’t grasp that? And by grasp, I mean handjob. Which is a reference to sarcasmic’s comment below. DO YOU GET IT NOW?

              Puns are evil.

          2. I started a rumor in the MLs that, in celebration of No Trolls Friday, you’re giving out handjobs to anyone who doesn’t respond to Tony.

            Now it’s time for you to pay up.

            1. Your Troll-Free Friday prize was remarkably sexist considering it’s International Women’s Day, sarcasmic.

            2. It took me a second reading of your post to try and figure out what the fuck major league soccer had to do with anything you were talking about.

            3. I’ll be in the bathroom in stall three, come in any time.

              “Dennis, if I was looking for safe, I wouldn’t be sticking my dick through a wall.”

              1. I hope you have the long, dexterous fingers of a pianist, so that you can reach through that hole in order to pleasure Nicole when she pushes her hideous, writhing mass of bristle-wire hair, stinking of rotten cheese, pulsating mound up against that wall. It would be sexist not to give her pleasure as well on Women’s Day.

                1. Thanks, Jim, it is now officially too late for me to have any pleasure at all on Women’s Day as I’ll be spending the rest of it vomiting.

                2. Did you say something, JJ? I couldn’t hear you over your mom’s moans.

                3. THIS IS WHY THERE ARE NO FEMALE LIBERTARIANS.

                  /Schultz

              2. Kids these days. If one is getting a handjob through a glory hole, one is doing it wrong. There best be an orifice of some kind on the other side of the stall wall.

                1. This is literally the best chain of comments I’ve ever read on an article about Singapore.

  3. By contrast, Singapore of today is known as a not-so-democratic state where civil liberties are kept in sharp check.

    The wealthy don’t normally have to worry about any of that. Not until they least expect it.

    1. If the democracy is infringing on civil liberties that you hold dear, while the authoritarian state is infringing on civil liberties you don’t care about, the authoritarian state may seem more appealing, right?

  4. I’ve been told there is no distinction between civil and economic liberty – that they are inextricably tied together. Singapore is proof that this is not the case.

    All in all, I prefer Hong Kong.

    1. All in all, I prefer Hong Kong.

      I know. As you so eloquently put it in this blog post that should be read by everyone here.*

      *Except for any of you that may have recently graduated from a NYC high school. In your case, Warty will come over and rape you read it to you.

      1. Man I’d forgotten about that.

        How droll of you to remind everyone.

        Also, how’d it go w/ the kid?

        1. Fine. Kara gave birth a little over three months back.

          1. OMG show him the pictures!

          2. I knew she gave birth, dumbass. I was talking about the medical issues I’ve read about in some of your comments over the last week or so.

            1. Well the surgical team from Stanford concurred with our original one and so we’re gonna be waiting quite some time for her surgery. They say 9-12 months, which is fine with us now that we got a few things explained in some more detail.

              1. Well as long as she’s going to be alright, that’s all that matters.

    2. I’ve been told there is no distinction between civil and economic liberty – that they are inextricably tied together. Singapore is proof that this is not the case.

      I think Singapore is proof that if you have one locality with economic liberties, and one with civil liberties, it is possible to arrange things so you get both.

      Or, if you have an extensive enough estate, bans on chewing gum in public are irrelevant since you will be on yours or someone else’s private property most of the time.

    3. I’ve been told there is no distinction between civil and economic liberty – that they are inextricably tied together. Singapore is proof that this is not the case.

      There really is not and you can turn around and use Singapore to disprove it.

      Economic *liberty* means voluntary exchange. And when the authorities restrict the object of exchange, or what kind of business you want to run, you can show that there is no distinction between economic and civil liberty.

      Even if the exchange were “free”, as in not involving currency units, it is still an economic activity because you are doing it for psychic gain.

  5. Freedom for money attracts money. Freedom for people attracts people. So, freedom is attractive, but there are different types of freedom.

  6. There is no relationship between democracy en se and economic policy outcomes — a policy will have a certain effect regardless of whether it is a democracy or an autocracy that implements it, if the regimes are similarly situated (i.e., stable, rules-based democracy compared to stable, rules-based autocracy).

    Of course, democratic input is a good way of avoiding certain extreme tyrannies and some instabilities.

    1. For forms of Government let fools contest,
      Whate’re is administered best is best?

    2. a policy will have a certain effect regardless of whether it is a democracy or an autocracy that implements it

      My bat-signal went off. What?

  7. Freedom is more useful for becoming rich than it is for staying rich. So it’s not suprising that principless people back freedom when they’re earning their fortunes but then want to crack down on any potential competition once they’ve made it big.

  8. Exactly how is Singapore infringing on civil liberties? I’m curious if the rep reflects reality.

    1. Exactly how is Singapore infringing on civil liberties? I’m curious if the rep reflects reality.

      They have very harsh drug and gun laws, for two. Freedom of speech is also somewhat restricted. The big one is they have national service, i.e. the draft. But from what I have seen of the US, it isn’t much different in practice.

    2. They also limit/censor television broadcasts and the internet to keep out some porn and other things they consider offensive. It’s actually a pretty regimented life. I didn’t really care for it. It’s like being in NYC, if there was a cop on every streetcorner enforcing every law. You feel like there’s always someone watching, waiting for you to miss the garbage can with a wrapper so they can kick your ass.

    3. Oh and if you think the US has draconian drug laws, Singapore doesn’t fuck around – execution.

  9. Singapore, night life, four floors of whores, or so I’m told.

    1. four floors of whores

      Only in Geylang.

  10. But it also has relatively secretive private banking laws and zero harassment from paparazzi or protesters, whose activities are narrowly proscribed by Singaporean authorities, further creating an aura of order and stability.

    I’ve never ‘heard the right to be left alone enforced by the state’ expressed in quite that way before.

  11. United Kingdom of the 1880s were centers of increasing democracy and personal freedom in both the civil and economic spheres ? certainly by contrast to the alternatives. By contrast, Singapore of today is known as a not-so-democratic state where civil liberties are kept in sharp check.

    I think that there can be clear divisions between a country that respects “civil liberties” in the specific sense, and general freedom from regulation in another. And I suspect that’s what we see with Singapore.

    It’s an authoritarian regime that might not give you unfettered freedom of speech, if you get accused of a crime, you may not have the protections of the fifth amendment (for one example), but you can start a business, invest in ideas and move wealth around fairly freely.

    Do the wealthy entrepeneurs moving there really care about doing provocative live nude performance art? Are they really concerned about the internecine political squabbles going on between obscure political parties, or do they want to set up a data center or open a manufacturing facility without all the onerous OSHA requirements and labor laws, wage restrictions and healthcare mandates that you find in the west?

    I suspect it’s the latter. Those more technical civil liberties only come to the fore after living in a place for years or decades.

    1. No fourth or fifth amendment really get to me. People don’t think about them alot, but even in truncated form, they’re a scary thing to be without.

      1. Yeah, I mean without them, the government could just detain people without charge and/or investigate them without cause or warrant. IOW, it would be just like today.

        1. I know, I know. But at least it creates a basis for challenging those sorts of things, as opposed to the actual written law being, “We can do whatever we want and fuck you!”

      2. Absolutely, but that’s not first and foremost in the wealthy entrepeneur’s mind.

        Scenario: Co-founder of facebook gets fed up with the regulated west, does some research, finds singapore to be super-friendly to movers and shakers who build businesses from the ground up. So he moves there. Along the way, he hears that they execute drug dealers in that country. Laughing, he says, “I’ll be sure to avoid starting a drug-dealing business”.

        Ten years into his wildly successful time in Singapore, he has a kid with his American wife. The seventeen-yr-old acts like the typical privileged 17-yro, decadent, smokin’ weed, living the lifestyle of an over-privileged youth everyone comes to expect.

        At some point, he crosses paths with the wrong authorities, gets nicked for drugs and is looking at life in prison. THEN Facebook co-founder dad becomes concerned about civil liberties.

        1. Ten years into his wildly successful time in Singapore, he has a kid with his American wife. The seventeen-yr-old acts like the typical privileged 17-yro, decadent, smokin’ weed, living the lifestyle of an over-privileged youth everyone comes to expect.

          What most likely happens is when the kid hits 18 and has to go into NS, he has a choice; do the two years or renounce citizenship.

          At some point, he crosses paths with the wrong authorities, gets nicked for drugs and is looking at life in prison execution if greater than 15 grams. THEN Facebook co-founder dad becomes concerned about civil liberties.

  12. Authoritarian countries can be wonderful for wealthy people so long as the government is reasonably corruption free and you don’t bother those in power.

    Russia is great if you are one of Putin’s Kleptocratura, but hell for anyone else, wealthy or not.

    Also, authoritarian countries can turn viscious very rapidly.

    There is a lot of stuff that the electorate likes that I don’t – such as high taxes – but I will take a country with high taxes over one with secret prisons any day.

    1. but I will take a country with high taxes over one with secret prisons any day.

      Doesn’t the US have both? I prefer a country that is up-front about its character.

      1. We are pretty open about our prisons in the US – I am sure that some other countries would not mention they have a “Supermax’ like we do out in CO.

        1. We are pretty open about our prisons in the US – I am sure that some other countries would not mention they have a “Supermax’ like we do out in CO.

          I was talking more about the off-shore, rendition prisons the US operates via the CIA. All countries have their good and bad points.

          1. Um, not all. North Korea has no good points.

              1. Right wing idiot! Average wages for Zimbabwe are hundreds of dollars an hour. Check your facts hater.

                1. Check your facts hater.

                  Hah! That was last week. It’s thousands of dollars an hour now.

                  1. See! Zimbabwe is so far ahead of us. They’re poor, but the people make money. But here, people make less money but there is more money so therefore the coporations are hording it all. Proably in vaults.

                    1. “Proably in vaults.”

                      I hope so. Just like Scrooge McDuck and his vault of gold coins.

              2. They have a really nice lake.

            1. Um, not all. North Korea has no good points.

              It can serve as a bad example, so that is good, yes?

              Other than that, you are correct.

            2. It’s not much, but their beer is better than South Korea’s. Even the Southies themselves admit it. I’d put in links to relevant articles into the previous two sentences, but I can’t figure out how to insert external links on this site, so pretend that these are up there:

              http://www.economist.com/news/…..oring-beer
              http://www.koreabang.com/2012/…..rised.html

              1. Being better than SK at making beer is a really low hurdle. I have lived the Hite Life and it’s turrible.

                1. Hite isn’t that bad. They sell it cheap in Atlanta’s Korean supermarkets.

                  1. It tastes bad and is more likely to give me a hangover than other beers. I’m not seeing an upside.

      2. The US is actually pretty low tax as far as OECD economies go.

        And as LTC(ret)John points out, the US is pretty open about it’s prisons.

        Further, the Bill of Rights is generally observed in the US. (Granted the BoR is being weakened and there are many breaches, but there is at least a good chance of redress for violations.)

    2. Authoritarian countries can be wonderful for wealthy people so long as the government is reasonably corruption free and you don’t bother those in power.

      Depends on what you mean by “corruption”. If harsh unlibertarian laws can be sidestepped with a few bribes, then that corruption can be a good thing.

      1. William Roper: So, now you give the Devil the benefit of law!
        Sir Thomas More: Yes! What would you do? Cut a great road through the law to get after the Devil?
        William Roper: Yes, I’d cut down every law in England to do that!
        Sir Thomas More: Oh? And when the last law was down, and the Devil turned ’round on you, where would you hide, Roper, the laws all being flat? This country is planted thick with laws, from coast to coast, Man’s laws, not God’s! And if you cut them down, and you’re just the man to do it, do you really think you could stand upright in the winds that would blow then? Yes, I’d give the Devil benefit of law, for my own safety’s sake!

  13. economic liberty tends to breed prosperity, which helps you buy (or at least, rent, other liberties). In Singapore’s case, sounds like they want people to be free to make money and be successful without having to fund a massive welfare state or deal with Occutard-style trustafarians.

  14. What Does It Mean When Wealth Flees Democracies for an Authoritarian City-State?

    It means that, when it comes to financial liberties, the democracy is likely more authoritarian than the city-state, however much better the democracy may (or may not) be regarding civil liberties.

  15. It doesn’t hurt that Singapore has some of the lowest taxes in the world, including none on capital gains and most foreign dividends. But it also has relatively secretive private banking laws and zero harassment from paparazzi or protesters, whose activities are narrowly proscribed by Singaporean authorities

    Private banking laws — the government not being allowed to pry into one’s personal finances — is the opposite of authoritarian.

    Muzzling the paparazzi, not so much so, though if the press has devolved into a bunch of statists agitating for higher taxes and more business regulation, I could see the attraction of that too for people who want the government and its allies to leave them alone.

  16. So who cares about all that stuff anyways

    http://www.PrivateWeb.da.bz

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