Jeff Oon (2014) summarized Sudhir Thomas Vadaketh’s article on wealth disparity in Singapore. According to Oon, Sudhir suggests that Singapore needs to make a risk assessment on wealth inequality today. He states the danger of extreme inequality, for example, it disrupts the citizen’s innate sense of fairness, can lead to several economic inefficiencies or threatens social stability. Sudhir had pointed out that citizens are paying more attention to wealth disparities in recent years. It is important to reduce wealth inequalities if Singapore wants to preserve Singapore’s core tenets of individual responsibility, equality of opportunities and meritocracy. Jeff Oon also stated Sudhir’s ideas to reduce wealth inequality. Base on his idea, the government should come out with a more efficient tax policy which taxes on the rich more, not the incomes of the middle class. And the government also need to build up the bottom end of people with more healthcare and finance support.
Indeed, there is also evidence that shows wealth inequality has grown exponentially in recent year. A global wealth report released by Credit Suisse in October 2013 showed that the richest 1 percent of Singapore population hold more than a quarter of its total wealth. Thus, it is good that Singapore can come out some better policy to reduce wealth inequality.
There are two most obvious parts when we think about reducing wealth inequality, are the poor and the rich. For the bottom end people of the country, healthcare and finance support do really help a lot for this group of people. However, the main point should be finding ways to help them and the middle-class families earn more. Investing in education may be one way to help them. In order to prevent or minimize the inequality across generations, it is very important to maintain education and school quality for every child. Investments in education may not increase family income immediately, instead it may create a new burden for the family. Nevertheless, in the long run, it helps to push up family income and total wealth. Singapore should continue to provide strong support for education and increase the publicity of student subsidies or other forms of education support to those families need more help. In addition, lower down the living cost and increase minimum wages are the two useful methods to boost poor families’ income.
On the other hand, pulling down people from the richest group is another essential way to reduce the wealth inequality. A strong tax policy is one of the most efficient ways to cut off the tops. As what Oon mentions in his summary, there are many reasons why wealthy people choose Singapore for living or doing business. This includes business convenience, social security and stability, good healthcare and education system, technology, travel, transportation and others more. Thus, the rich will not leaving Singapore, perhaps they would like to contribute to the society more by paying a higher tax. Hence, the government will have more money to benefit society, and all this will going into a healthy loop.
By now, it is clear that more inequality societies tend to have more problems (Porter, 2014). Singapore had done pretty well for equality of opportunities so far. There are many reasons behind the wealth inequality gap. Some of them can be controlled, like governments’ subsidies or tax refund. Some of them cannot be controlled, like globalization and capital owners getting richer by new technology (Thompson, 2013). It is better to have a good solution before the wealth inequality gap gets bigger.
