Kenneth Jeyaretnam, Obama and Eric Hobsbawm

Kenneth Jeyaretnam, Obama and Eric Hobsbawm

I was surprised to learn Singapore does not have a minimum wage for workers.

The late Singapore opposition politician JB Jeyaretnam's son, Kenneth Jeyaretnam, a British-educated hedge fund manager who has joined his father's Reform Party, made an important point to The Online Citizen.

“Generally I think that the government focuses too much on GDP growth for its own sake where it should be focussing on things like GDP growth per capita and the incomes of ordinary Singaporeans,” he told the Singapore blog.

Whether the government focuses too much on GDP per se is open to question.

But it's true GDP growth is not an accurate measure of people's wellbeing.

It's possible for a country to have high GDP and a large low-income group at the same time. China is the most obvious example, the third largest economy in the world, but with a per capita GDP of less than $6,000 in terms of purchasing power parity. Singapore's per capita GDP is nearly nine times more.

However, the income gap is increasing in Singapore, according to the official Statistics Singapore:

"The Gini coefficient, which is a summary measure of income inequality, increased from 0.472 in 2006 to 0.485 in 2007."

That means Singapore has a greater income gap than Britain and America, which have Gini coefficients of 0.35 and 0.45 respectively, leave alone Scandinavia, France, Germany, Switzerland, Belgium and Austria and the Netherlands – countries with Gini coefficients ranging between 0.25 and 0.3, according to a UN-Habitat report.

The Singapore government is trying to help the people cope with the recession. So are governments in other countries – and for a very good reason. A country's economy depends on all its people.

It's interesting what Kenneth Jeyaretnam had to say about "GDP growth per capita and the incomes of ordinary Singaporeans".

He may sound a bit like his father.

But President Barack Obama also expressed a similar view in his inaugural address:

The success of our economy has always depended not just on the size of our gross domestic product, but on the reach of our prosperity; on the ability to extend opportunity to every willing heart -- not out of charity, but because it is the surest route to our common good.

As did the British historian Eric Hobsbawm in the Guardian two days ago:

Look at London. Of course it matters to all of us that London's economy flourishes. But the test of the enormous wealth generated in patches of the capital is not that it contributed 20%-30% to Britain's GDP but how it affects the lives of the millions who live and work there. What kind of lives are available to them? Can they afford to live there? If they can't, it is not compensation that London is also a paradise for the ultra-rich. Can they get decently paid jobs or jobs at all? If they can't, don't brag about all those Michelin-starred restaurants and their self-dramatising chefs. Or schooling for children? Inadequate schools are not offset by the fact that London universities could field a football team of Nobel prize winners.

The test of a progressive policy is not private but public, not just rising income and consumption for individuals, but widening the opportunities and what Amartya Sen calls the "capabilities" of all through collective action.

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