Striking at the root of the problem in SMRT

November 29, 2012

Consider this simple Simon question: Was it such a great idea to privatize the trains and buses? Well if we go by the capitalist manifesto, it would appear so. After all, in an age of budgetary constraints, privatization makes an excellent argument that’s hard if impossible to set aside. For starters the sale piques the interest of taxman. He walks away with a big bone. From a business standpoint, privatization even manages to fufill the criteria of sustainability, since it’s able to recruit the profit motive along with revivifying the old – in theory, at least, the service improves, commuters benefit, the state rids itself of a millstone, investors profit and life is sweet.

The happy days unfortunately is not what SMRT seems to be enjoying. And let’s not not even get into the case of disgruntled commuters who have to regularly impersonate sardines during rush hour. Along with perhaps mainland bus drivers who have been pushed so far that they have even decided to go on strike.

Now please don’t misunderstand me. I am not suggesting ALL state assets would never benefit from privatization. Most do as historical accounts seem to support the contention flabby state owned steel mills, coal mines, car factories et al do benefit dramatically from privatization – but where the theory lags behind the reality is when privatization is directed to public services, specifically the essential services e.g transport and healthcare. And one reason why essential services have never ever been great revenue generators is simply because they’re lousy business models – since they usually cost more to provide and maintain than they could ever hope to attract in revenue – for starters (without a single exception) they all seem to suffer from the paradox of capitalism i.e for a public service to be managed well, it may actually need to be as inefficient as possible. To put it another way, essential public services such as SMRT cannot possibly chase profit without doing violence to the whole idea of providing a great service along with perhaps fulfilling the aspirations of it’s employees.

I understand what I am forwarding here may well be a paradigm shift in the traditional way in which we all make sense of the world – but do bear with me. Consider this, if the goal of a public service such as trains is to deliver value to it’s shareholders – then why not just convert every station that has the lowest user frequency into a food court cum bumper car ride theme park and keep only the short inner city routes which have the highest frequency of commuters? Do you see my point? As one reason why essential service are all without a single exception flawed business models is because once the focus shifts from providing to efficient essential service to chasing profit, then what can only happen is the whole idea of public service can only be relegated to second place. Whenever this happens a form degenerative disease creeps in. One that we see so often from the endless travails the seems to mire SMRT – mind boggling preventive lapses along with the recent strikes of PRC bus drivers having to work and live under conditions of slavery – I wonder could this be the reason why Britian, Spain, France, Japan and even China regularly subsidize their rail service – their bureaucrats even seem to derive a “perverse” pride for losing money occasionally whenever they run into the red. Why? As what constitutes a well managed essential service such as public transport or healthcare is essentially a function of how one goes about defining a well managed enterprise. Keep this in mind. As it will all connect beautifully as you read on my dear perceptive reader.

The second argument against the privatization of essential services such as SMRT is, it creates a moral hazard. As the only reason (I can think of) why private investors such a Temasek would even be prepared to make a business case out of running an essential public service is because they know only too well – in the event of a fuck up, the government can always be counted to stand in as the de factor guarantor to eliminate the exposure of the operator from the risk of a fold up (wonder no more why SMRT got a billion dollar cheque from the govt) – to exacerbate matters since the operator now has to foreclose on an all together impossible mission of generating a respectable profit along with providing commuters a reliable means to get from A to B – it is compelled to induce a split personality bordering on schizophrenia that can only arise from having to serve two diametrically opposing masters -that is trying to generate profit for private share holders while at the same time trying its best to provide an essential service – and since this cannot possibly be sustained from a business standpoint without something giving way – the state needs to step in from time to time like a demented Jack in the box to bail out the operator from hot soup – wonder no more why we see govt intervenion galore such as in the bus driver’s strike, subsidies in the form of writing blank cheques to justifying the case for another price hike –  result: private services are no better than what they used to be when they were run by the state. To put it another way, what we have today when we look a SMRT is a outfit that embodies the FORM without the complimentary CONTENT of a private enterprise – and this should prompt the preceptive reader to ask: why even privatize an essential service when it brings absolutely no discernable benefits to taxpayers? Why even go through the bother of putting up an elaborate pretense of trying to make an essential public service anything other than what it should be, an essential public service that should at best break even and if possible lose money, IF the imperative is to provide commuters with a safe, reliable and efficient means of transport – along with possibly creating jobs that nourish the idea of dignity of labor along with fashioning itself as a model employer to help wean SME’s from their opium addiction to cheap foreign labor. 

And last but not least and perhaps the strongest case that militates against privatizing public services is they simply cannot be left to the vagaries of the free market – not without producing so many undesirable fall outs and abberations that we regularly see coming out from a basket case like SMRT. As when essential services are handed lock, stock and barrel to businessmen – the default position is government has divested their responsibilities all together to a taxpaying public in perhaps the way same an irresponsible parent puts a child on the door step of some home – and when that parent is confronted by a baffled crowd, all they can really do is exclaim, “don’t look at me, that’s not my baby.”

To which the wise and responsible can only say – “Why are you so fucking irresponsible?”

Darkness 2012


“Let me ask you all a simple question Gentlemen. If you run a SME enterprise and you hear that a big juggernaut firm like Temasek is running an outfit where workers are stacked in a dorm infested with bed bugs and rats. They aren’t even paid a salary at parity with their co-workers by sheer fact that they are of a different nationality although they do essentially the same work and put in the same amount of hours. On top of that these people have been put in position where they even feel that they have to resort to striking to be heard as no one really asked them, hey is anyone taking care of your rights? – then how seriously do you think any SME owner would take the governments clarion call for change? I don’t think any reasonable businessman can take these people seriously – as there is really no basis to take their advisory seriously – after all they aren’t even walking the talk themselves – their house is in a right mess! In my honest opinion all they seem to be doing is churning out feel good platitudes by forwarding the illusion that they seem to be serious and committed about putting an end to the narcotic of cheap labor – so as a SME owner why would you even take what those buggers have to say seriously? As for me, I wouldn’t even give them one minute of my time to these people. If Sim Ann came to visit me, she would even get through the first parameter gate – I will just treat them like the Singaporedaily – they are irrelevant and there is no basis to take them seriously at all, and. That gentlemen is a very big problem. Do you all see the broader rammifications of this bus driver’s strike now?”

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