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11/09/2008

Equal misery?

I just read Gerald Giam's article on axing staff by companies to boost profitability. Down sizing is always a last step in a company's list of options to cut cost as its impact on the affected employees is more than just losing a job. It is something that responsible management should think very carefully before doing. Maybe the trade unions should take a stand on this issue. Companies that are still making profits, though lower, should not be allowed to axe staff. Such a measure can only be supported by the unions when the company is going into the red. A few years of lower profits or even no profit is not something that is intolerable. And just a play on numbers. If companies are paying 12 mths or more bonuses, by halving the bonus payout is equivalent to cutting the staff by a quarter. And to cut a 10% workforce, the company could simply reduce the bonuses by 20 or 30%. No need for desperate measures like retrenchment. Companies have a social obligation to their employees and to society to avoid such drastic and destructive measures. Do companies resort to retrenchment to protect their big bonuses?

28 comments:

Anonymous said...

Brace for more jobs cut that are comming around the world.

Anonymous said...

What about the rights of shareholders? Who fights for their rights to profit for their investment? It is very well saying that retrenchment is the last avenue, but in business the objective is profit. If not for profit, why go into business? Sometimes retrenchment is for the good of the company and for the welfare of the remaining staff.

redbean said...

the shareholders have been more than adequately compensated for many years. a couple of years of lower profit or no profit should be taken as part and parcel of doing business.

only in paradise when there is monopoly that businesses demand to make profits every year. this is the artificiality of our economic system.

even with the retrenchement, dbs will be making lots of profits just like the smrt.

Anonymous said...

Few months down the road DBS may be hiring again, at lower salaries of course. It is an old trick, but you can't fool an old horse.

Anonymous said...

At the end of the day,when it has been all said and done, it is the shareholders that must come first. Without the share holders there will not be a DBS. Without a DBS there will not be any jobs for anybody. Therefore the bottom line and the shareholders' profit that must come first.

Anonymous said...

Yes, yes it's true. Without DBS there will be no jobs for anybody. Same argument as: without the oracle there will be no Singapore. Same argument as: without foreign workers, Singaporeans will have no jobs.

redbean said...

you people are learning extremely fast. stop parroting can?

Anonymous said...

Go and let your PAP MP see you and give him or her an earful!
I am furious! I cannot believe the extent of uncompassion among
Singaporeans, those holding good jobs and good income. Not a cent
from them to the lower income groups. While the low-income earners
are working long hours to the point of sickness, bus drivers with 3
kids to feed only take 1 day off per month, the PAP politicians go merry making, giving talk, and unsolicited advice to tell the educated to have more children or the less educated to have less children. It is none of his and his father freaking business to tell others to have children. Just mind his own
and his kids business. I cannot believe it when I know it. Singaproeans
with good income refuse to give a single cent to charity, why serve free national service for these hypocrites politicians!!!!

Anonymous said...

public library users cannot keep their noise level down, must be repeatedly told to do so by librarians. shows the extent of the ungraciousness in Singapore

Anonymous said...

PAP/ISD is tapping telephone conversation, smses and other communication in Singapore to know what Singaporeans is talking about, the level of surveillence is amazing

Matilah_Singapura said...

Here we go again with "the world owes me a living" entitlement-welfare mentality.

> Companies have a social obligation to their employees and to society to avoid such drastic and destructive measures. <

In your dreams pal.

Companies have no such obligation - regarless of the hallucinations yoiu might be experiencing.

Companies can internally decide how they are run: who to fire and hire, who to reward with bonuses, and why.

Companies are private property and therefore are under no obligation except to agreements made by voluntary contracts.

Anonymous said...

daily-wage income earner see no pay increase but prices all around keep increasing, PAP politicians just stand by and watch people die, no only that PAP put fear in others to stop people from protesting, oppressing the people

Anonymous said...

matilah, stop your insensitive comments at the wrong time, your ar always making insensitive comments at the wrong time when others are furious, make people angry further

Anonymous said...

leisurely PAP politician intelletual discussions while the low-income earners are suffering like hell
this is currently the extent of suffering on the ground level, the Singapore mass media is totally pro-PAP until crazy, like the totalitarian communist mass media, I cannot believe the extent of media control here in Singapore, let all this out so more people know

Anonymous said...

even my internet traffic also monitor, what I type into google and yahoo also monitor, to try to scare me, right? no way!

Anonymous said...

read this news report:
http://www.channelnewsasia.com/stories/
singaporelocalnews/view/388696/1/.html

>>Speaking to reporters later, Mr Heng said
the downturn will affect job growth and security.

talk is free, talk and talk, can PAPP talk the problems
away, I cannot believe the tactlessness of the PAP politicians
its as if the workers do not know that

Anonymous said...

frakking shareholers... greedy idiots. without the ants and bees (cheap labour) how the frak you get wealth... inheritance is it or robbing like the ceo, just because you have some wealth doesn't make you intelligent, do you employ people or run a businees(wrst thief ceos). you the shareholders sound like a person who make money by investing money(however you come to it, smart) has no rights. boo hoo hoo, cry me a river.

Matilah_Singapura said...

What is so insensitive about letting people know what the truth is?

Private companies are private property. They didn't get rich over night. The people in the companies — owners and workers — had to work very hard for a long time to grow the companies. No one gets mega-bonuses unless the company was big enough to afford such pay outs anyway. Do you think this "growth" happens instantly?

Instead of moaning and groaning about "morality" this and "ethics" that, why don't some of the losers here try to grow a business from scratch — risk their own property, work without pay for years, perhaps even lose money... and prevail.

Then they can talk.

Anonymous said...

Maybe some posters here could come up with a petition, for state enterprises to cut down on profit - even making losses - and employ more workers. Order people to dig holes along the beach, or something.

Living in lofty quarters, it's easy to be enamoured with Marxist ideas.

Anonymous said...

Haha, they are saying we will have a expansionary budget next year. Then maybe the idea of employing people just to dig holes along the beach may come true.

You know, there seems to be a habitual digging and tiling going on in various places encircling Hougang, sometime don't know what the dickens for, like for fun. It's the resident's money being spent on unneccessary beautification to gain political mileage.

Matilah_Singapura said...

the PAP cadre will be singing songs of "solidarity"so that everyone is "equal" in their misery.

State-owned enterprises will get bigger, stronger and continue to suck the life out of the sheeple.

Anonymous said...

The official verdict on the financial crisis is that capitalism and free markets have failed - so the sheeple are clamouring for a return to under fascism. Being under the watchful care of Big Brother gives a sense of security.

Man, I so want a Swiss citizenship.

On the bright side, it takes a Carter to get a Reagan.

Matilah_Singapura said...

anon 503

Yes, that is absolutely true. Not just in S'pore, but all over the world — especially the developed world.

One can excuse people from bum-fucked countries to blame "exploitative" capitalism — because if these impoverished people figured out capitalism they wouldn't be shit-poor in the first place; but one would think that people in the developed world ought to know better. i.e. it is CAPITALISM which made them rich(er), not the state. The state was there to provided the rule of law, so that people could produce and trade with (relative) freedom.

If it wasn't for capitalism in the first place (i.e. free production and trade under the rule of law), these lefties and other socialists would have the technological tools to express their ideas. The fact that there is cheap and readily available food means these ignoramuses don't have to hunt and prepare their meals — all because of free enterprise and a planet-wide market economy.

The old Republican joke It took a Carter to get a Reagan is cute, but not 100%. One could also say it took a Stalin to get a Lenin, though that eventually led to a Gorbachev ;) And one could also say, as I'm sure they are in the Democrats It took a Bush to get us an Obama — who now has "messiah" status, a few notches up from his "rock star" rung.

A few posts ago I played devil's advocate on the eventual collapse of the dollar — I alluded to it not probably happening. I am not so attached to that opinion now.

The possibility of people to completely lose faith in the USD as a global reserve currency and universal medium of exchange is getting stronger. The fiat money, state-controlled central bank system of global currency might indeed collapse. All governments are inflating more (even China and the EU — up to lately sensitive to inflation), and the US and other countries like AUS are contemplating creating more currency.

But most of the people love it. And there has not been too much protest about nationalisation of private enterprises.

There is little doubt that the political compass being pulled toward fascism, and it is my belief that we are going to get it — to what degree, I'm uncertain.

But there is hope, there always is. Some of us know markets will fail if they are interfered with. In that way we are forwarned, which means we can prepare to seize opportunities present by failure which are CERTAIN.

I would say between 2012 and 2016 we are going to have an even bigger, more spectacular system-wide failure, due to the world's fiat money systems.

Anonymous said...

re: matilah_singapura

Krugman had an article today entitled 'Franklin Delano Obama?' vouching for a new New Deal. Obama in fact hinted that he'll be taking his cues from the New Deal in his victory speech.

I don't understand these Keynesians - I believe it was Einstein who said that the definition of stupidity is doing the same thing over and over again yet expecting different results. How can mainstream economics be so wrong?

It's a matter of time we'll see a new monetary system i.m.o. - personally I don't think it's far-fetched to envision a one-world fiat paper standard issued by a one-world central bank (e.g. Keynes' bancor idea). The Europeans were conned into believing the necessity of a European paper currency after all. So long as you push the right buttons at the appropriate moment, the idea will be an easy sell.

btw as to when things will actually collapse, a lot still depends on individual players i.e. governments and central banks. I don't really understand why they are doing what they are doing - having short-term fixes while ignoring long-term consequences, addressing the symptoms but not the fundamental cause.

But here's hoping that I can enjoy my haute cuisine and beers for a little while longer ;)

Anonymous said...

"I don't understand these Keynesians - I believe it was Einstein who said that the definition of stupidity is doing the same thing over and over again yet expecting different results. How can mainstream economics be so wrong?"

And it was Goh Keng Swee who once said those who indiscrimninately applied Keynesian ideas were 'lesser minds'.

Matilah_Singapura said...

I think it is best to move away from ad hominem attacks on Keynesians. I can understand the frustration of people like Goh KS, and thus understand an outburst of his, but labelling your intellectual opponent "lesser minded" is hardly a valid argument.

That also doesn't mean I'm innocent of labelling people. Hardly. I have a very foul mouth. When comes down to seriously defending ideas which I think are correct — i.e. grounded in causal reality and the nature of the universe, then I would say clear reasoning — cold, hard and calculated is the only way to the objective truth.

I always hold the belief that one should try to understand one's opponent in order to beat him. Keynesians, socialists and statists never win their arguments over those who hold individualism and capitalism as accordance with reality because those Keynesians, socialists and statists don't understand the nature of the universe, and the concomitant laws derived from that immutable nature.

To adhere to the Randian (Aritotlean derived) "tennets" of logic and reason, all arguments are based on premises. Therefore one has to identify the premises made by Keynesians and judge them as false or true. If B derived by reason follows A, but A is a false premise, then B is definitely "broken".

I lump Keynesians, socialists and staists together as part of a group I call "anti capitalists". There are many other "groupings" which are members of this large group of anticapitalists. They might have religious roots, or be tribal grounded in mystical tradition, or simply a bunch of your avergae school children who are brain-washed by their brain-dead public school teachers. (ad hominem? you betcha!)

Thus 2 reasons for anticapitalist opinion might be generalised:

1. Ignorance
2. ENVY


Remember, ENVY is a powerful emotion. It does often cloud reason. Many people, due to the failings in their own life, and the unwillingness to take personal responsibility, simply HATE and ARE JEALOUS OF those who have "achieved" in life, especially financial success.

"Hating the rich guy" is such a common personal opinion held by many people in society. They might be envious because of their lack of understanding too. The public schools are no help — the role of public schooling is not to encourage you or support you educationally on how to be wealthy, but instead to be dependent on the state, be kiasu, be submissive to authority, trust authority without question and you're encouraged to engage in petty "intellectual" competition with your peers in the form of exams.

Exams are are important. They test the subjects' knowledge and understanding. But to turn exams into mindless competition between students simply MISSES THE POINT of getting an education.
Two publications of interest (freely available on the net):

1. Ludwig von Mises The Anti Capitalist Mentality

2. Freidrich August Hayek Theory of Knowledge In Society

I've stopped despising Krugman. I simply laugh at the guy now. In fact I cackle at what the NY Times has become... the (so-called) "Newspaper of Record" (not!).
Krugman has earned his monicker: The most anti-free market free-market economist in the world. You simply can't make any meaningful sense of what he says. Utter nonsense. But it has a funny side.

"What? Me Worry?"

Just to allay the fears of those who might feel a bit "uneasy" in these times: no need to worry. As long as you can produce something marketable and trade it reasonably freely, it will be alright. Even if the currency collapses, alternative mediums of exchange will be almost immediately "discovered" — just so mankind can live. No production, no trade ==> DEATH on a large scale.

WEALTH is more a state of mind than one's physical possessions and "net" money-worth. To "feel wealthy" you actually have to "be wealthy". And we all know from 1st principles in economics wealth is produced primarily by TRADING. The goods deemed as "tradeable" by the market determine the allocation of resources for their PRODUCTION. i.e. it is pointless producing goods which no one wants — unmarketable.

Therefore, always trade to be wealthy: trade your time and commitment for friendship, your integrity and reputation for trustworthiness, your good humor and nature for a magnificent social life — family and friends. These tradable goods require ENORMOUS resources, but these goods are of immense value and demand for them is always heavy — recession proof.

What the anti-capitalists fundamentally don't realise is that nothing — including the "highest" philosophical value — love — is "free". It has to be produced. Then traded in a free market.

The anti-capitalists also don't know or accept that because of the market, division of labour and specialisation, we are all dependent on each other — and no govt force is require for this to occur. Through our own very existence and the fact that we all are acting all the time, we are connected through the market by our actions i.e. I produce A, you produce B, ..., M produces the nth. good or service but we all trade to satisfy our individual needs — from food, to medicines to iPods and massages. To exist in a modern world, no one on earth can produce everything which he alone needs.

To the extent the anti-capitalists agree with the need to produce goods for human existence, they reason that it is The State who should determine and ultimately control what goods are produced to prevent "wastage of resources". As if a central planner has that kind of intellectual powers.

Many anti-capitalists are highly "educated" i.e. they have fancy degrees from lefty Ivy League universities. And remember that many fine educational institution, even the private ones, have ties to government. Therefore, there is a strong showing of tenured state intellectuals, most of whom are very much anti-capitalist.

Sad to say, even in his brilliant genius, Einstein leaned toward socialism.

Which only proves to me that no one can be "smart" in every single area of human ideas.

Anonymous said...

I'm fortunate enough not to be acquainted with any hardcore Keynesian (birds of a feather flock together I guess). And my anonymity allows me to do some verbal sniping online without due consequences =)

Keynes might have reeled in horror had he known of Krugman's doctrine i.m.o. Unfortunately Krugman has a Nobel as well as MIT/Princeton attached to his CV - which allows him to throw his weight around quite a bit.

And yup, humans have always trade and will continue to do so under whatever circumstances.

I'm aware of the arguments against public education, but I'm not comfortable with abolishing it. Every kid deserves a 'fair go' i.e. access to educational opportunities regardless of means; that he gets a chance to improve his own lot in life whatever his background.

Of course, you'd say where is the justice in taking other people's money to support the kid - but like it or not, not everyone brings children up in an environment of personal responsibility. Looking at some private colleges, I'm not convinced that private education provides quality assurance either.

I had a chat with a UChicago prof (also ex-IMF chief economist) - it's scary how he suggested that a greater, more stringent, regulatory framework should be created to prevent such debacles from happening again (which are intrinsic to our monetary system). Some of the ideas were patently absurd e.g. having the private sector to set aside 'funds' during boom times to cope with such crises, stipulating size of companies, etc. I suspect these Ivy League types have a certain ego - as with all central planners - that you could somehow financially 'engineer' things.

Matilah_Singapura said...

anon 933

Re: the public vs private education argument.

It boils down to the compact of whether or not systems deemed "public goods" can be supplied by private enterprise acting in a free market. In my belief they not only can be, but should be.

We can all agree that many (not all) "public goods" do confer benefits to individuals and society as a whole. (I'll give examples of negative public goods or public bads later).

Thus there is no argument of the importance of educating children, and they do indeed need a "fair go". However, the question is whether or not it is moral to force peaceful individuals minding their own business to give up their rightfully-owned private property (pay tax) to fund a public good? Also, if the state can take and spend, it can also determine the content and the infrastructure of the resulting system, in this case the public education system. Is it wise and moral to allow the state to determine what goes into your child's head, and to a large extent influence the development of his character and personality -- both very personal aspects of every human being.

If you look at the public universities in other countries, you will find that they are incredibly politicised -- why? Because they get their funding from the state, and are supported by certain politicians and their parties (both left and right, but noticeably more left)


The idea of "private educational institutions" in an area so dominated by the state is a complex one. Private schools still have to conform to regulations and standards set down by the state. To become a doctor or lawyer, for e.g. you have to apply for a license from the state. Then the states decide how many of each profession should be "produced" in the schools, and you end up with centrally planned lives -- to a greater degree than if you didn't have central planning. Plans are important. But they are best left to individuals and to voluntary associations of individuals to do, not by an elite central "authority" who presumes to be "better than" non-elite Joe or Jane Blo.

Singapore is a poor example of public education, because the people who emerge from school, although generally speaking blur, are at least able to read, write and do math. In other poorer countries, the public education system really sucks. I'll use India as an example.

In India, public education is by and large hopeless and many people simply cannot afford to go to school because they have to work. Enter private enterprise -- companies who in their self interest need educated people to work. Indian (and I suspect international) corporations have set up their own schools to educate kids and to then employ them.

Critics of this system say it's "exploitation". This is nonsense. The coporations take big financial risks to educate the kids. There is no guarantee all the kids are going to be employable or are even going to hang around. It is YEARS before the corporations can realise their investment into education. So far, it is working. These kids are learning all the high tech stuff, and have to keep up with it... compare that to an Indian govt public village school. [There is an audio article on this at the CATO.org website]

No one can predict how the free market will solve a human need, but if left alone, it will happen.

Re: financial engineering

The state is so much in control of the financial industries that nothing shocks me anymore. And whenever I hear "Ivy League", the warning lights go off.

Almost all the people I know -- family and friends -- are Keynesians. Some of the richest towkays support socialism and fiat money -- which they love to borrow. Funnily enough, my friends who "struggle" all wish the govt would get out of their way. The ones who are "ok" (at least on the surface) love the welfare state, taxes -- especially "sin" taxes, champion public education and health care, and get weepy-eyed when it comes to funding the arts so that those "poor starving artists" get (govt) help.

I don't even bother arguing with these folks. I prefer to have a good time with them at parties and social gatherings. Politics, economics and religion divide people.