6/09/2009

What charity or charity from who?

While some quarters of the population are heaving a sigh of relief with the handouts from the govt, one may want to ask what charity and where were the money coming from? From taxation, profits from ministries, stats boards, GLCs? From CPF? Imagine a pool of 2 million workers contributing an average of $500 pm to the CPF, from both employer and employee, this will come to $1b a month or $12b a year!(on a 12 mth basis). And this money is to be kept almost forever, or at least some, till the contributor is dead. Put it another way, it is the people lending money to CPF/govt. After knocking out the interests of 2.5/4%, if there is a profit of 2%, that is $240m annually. Ok, after the recent debacle, there could be negative profits or even losses. But if there is no unduly high risk investment, a 2 or 3% profit over the interest payable to the contributors should not be an issue. The point I am making is that the people is contributing to their own charity just by the CPF contribution alone, not even touching on the revenue of the state which is also the people's money.

22 comments:

Wally Buffet said...

On a macro level, this is how the economy works. The government cannot give something that has not already been taken away from you in the form of taxation, direct or indirect, levies, duties etc. The difference between good governance and bad is how the surpluses are deployed for the benefit of the people. On a scale of 10, I give this government a 7. Those banana republics around us? A 3 or at most 4.

Anonymous said...

Charity begins with self !

And ends at home !!

Take care of yourself and your families and You will not need charity and so will other families !!!

Kaffein said...

I've told many people that CPF is actually a tax. Very few believed. The return of the tax you pay to the government is so little. No safety net, no public health service, etc. The losers are actually Singaporeans themselves.

Kaffein

Matilah_Singapura said...

redbean, I think you are confusing your definitions.

The govt (the territorial agency which has a monopoly on taxation) cannot give charity. This conforms to the law of identity: 'A is A'

...unless you live in your own universe where A can be A and Not-A at the same time, which would definitely not allow your computer to work (Boolean logic will not work, and therefore computing is impossible) and thus will not allow you to have a blog and post on the internet. ;)

Anonymous said...

Can someone explain or interpret?

Matilah_Singapura said...
This comment has been removed by the author.
redbean said...

matilah, this time you are too cheem for me too. i also catch no ball.

Matilah_Singapura said...

It would help if you provide more information on what it is specifically you require explanation/ interpretation on.

Matilah_Singapura said...

Simply put:

The govt takes money. It may give money (redistribute) — i.e. the money it took from X and gives to Y, but that act of giving is NOT charity.

By writing what you wrote:

> one may want to ask what charity and where were the money coming from? <

... you are making the ASSUMPTION that whatever the govt gives out is CHARITY.

This is completely false.

redbean said...

ok, now i understand you and the govt. after giving away hundreds of millions, the govt is honest to say that all these are not charity, we are not a welfare state. make sense. the money is the people's money and only returns back to the people or taking from those who don't need it to pass it to those who need it. like robin hooh huh.

Matilah_Singapura said...

Yep. Wealth redistribution, by a central-all-powerful-monopolistic agency.

Don't forget corporate welfare. People moan and groan about the welfare state and how the useless needy people get money for being fucked-up.

Well folks, that is peanuts compared to the welfare queens of the corporate world. Fucked-up companies are bailed out, executives who have run the company to the ground get rewarded, and the "good" companies who have been responsible get TAXED to pay for the fucked companies.

A "needy" person might get a few hundred bucks from the govt, but the executives of failed corporations that have taken people's money and blown it... gets a BONUS, usually millions of dollars per executive.

Wally Buffet said...

Hi Kaffein,

CPF is actually forced savings. You can use it for housing, medical and approved investments. Without CPF, the public housing scheme in Singapore would not be as well developed as it is now. CPF helps to pay for the two main concerns which is housing and medical. If you are investment savvy, you can enhance your CPF balance. Without CPF, many households would be hard pressed to pay their monthly mortgage.Therefore, I don't think it's a tax in the true sense of the word from the point of view of the worker. But it may be a tax from the employers' side because it is a written down cost and adds to the payroll. Doing away with CPF places more disposable income in the hands of the population but inflation would escalate.

Typically, countries with a very high savings rate, for example Japan, gets very little yield from such savings. Too much money chasing after too little borrowers.

Anonymous said...

like we have the biggest tontine operator in the world. 12b guaranteed deposits per annum for peanuts ROI. and wow, a brillant deferred repayment scheme, to postphone repayment.. like forever?

Anonymous said...

CPF savings help to pay for housing, medical and investments, no questions about that.

The big question everyone is asking and afraid to know the answer is, is the money still there and sufficient to pay those reaching 55 years old (not that there are many who can withdraw large amounts).

If not, will they think of further schemes to prevent people from withdrawing until they have nothing left to withdraw.

Lucky are those who have taken their money out at 55. Good luck to the rest.

Lost Citizen

Wally Buffet said...

If it is of any comfort to you, Singapore still enjoys a Sovereign Credit Rating of AAA a rating enjoyed by only one of the G7 countries.

And I put my money where my mouth is. Although I am fully entitled to withdraw my CPF, I think it is safer and yield more if left where it is rather than depositing it in a bank.

Wally Buffet said...

As a further reassurance to you, the chances of the CPF going bankrupt is as good as your HDB apartment block collapsing. That's how remote it is.

In any case, either one of the scenario means that your money is gone because in Singapore, your money is either "invested" in your HDB apartment or the CPF.

Kaffein said...

Wally Buffet wrote:
"CPF is actually forced savings. You can use it for housing, medical and approved investments..."

Sorry I disagree. It is never a savings because the factors against it usually bring it below par. It does not grow with inflation, you are stuck with the interest determined by the government.

Not only, factors like land cost in building HDB flats are variable in which you will never actually know how much the house is worth. Medical? You must be joking. Approved investments? Only GLCs, or rather the big hoo-ha on Singtel.

It is a disguise of forced savings. Now there are rumors that the interest gained in CPF may actually dip. Because somebody's wife played in the stock market and got burnt. We are paying for the mistakes.

Kaffein

Anonymous said...

With Wally's confidence in the CPF I will tell my kids, friends and relatives to sleep soundly at night. I hope I am right.

Hey, didn't they say AIG (among other big institutions) could never collapse. Of course it did not, and that is because the US Government says it is too big to fail, so they prop it up. I hope we also have people who believe in the 'too big to fail' mantra and prop up our CPF when the inevitable happens.

As far as ratings go, some institutions go from AAA to lower or even junk status in a short time. Bettter take them with a pinch of salt.

Lost Citizen

Wally Buffet said...

Hi Kaffein,

"Medical? You must be joking."

Sorry, I lost you. Pray explain?

"Now there are rumors that the interest gained in CPF may actually dip. Because somebody's wife played in the stock market and got burnt. We are paying for the mistakes."

Not so. Please read article on Page B8 of today's Straits Times. You will get more for your Medisave, Special and Retirement accounts.

I really empathize with all the old folks who took out their nest egg from the CPF. Splurge it on China women and park a portion of it in Banks at a LESSER rate of interest.

Wally Buffet said...

Hi Lost Citizen,

However large AIG was, it is still a corporation. We are talking about Sovereign Credit Rating ie Credit Rating of a Country.

In my humble opinion, the CPF has served us well. Had there been no such scheme, I doubt I would now have the little modest roof over my head to shelter me from the scorching sun. Grrrrh!

No worries. Even if my little dollop of a nest egg is lost, it is nothing to lose sleep about. We came here in our baby suit and in like fashion we will have to leave.

Hehe.

redbean said...

i don't think we should dismiss those uncles who spent their monies on their desires. we throw our monies in different things as long as we are happy doing it. some call it indulgence, some hobbies, some squandering, some as past times.

we need to make ourselves happy now and then, pamper ourselves a little.

did you get your digicam, willy?

Wally Buffet said...

You are absolutely right but I would add a word of caution for our more gullible peers:

1. Never be fooled by all the sweet talk and compliments that you are a "Don Juan". As far as they are concerned, you can even be the hunchback of Notre Dame for all they care, if the money is good.
2. Be aware that you are not the only man splurging on her. There could be as many as five or more lau heelou doing the same, on different days!
3. They are here only for the money so that they can have a better life back home. Earn here enjoy back home. So forget about the follow ups once they leave.
4. Everyone of them is a 90% possible HIV carrier so be adequately shielded. The consequence is the same if your computer gets bombed by a virulent virus. Everything gone. Kaput!
5. All the young ones have got husbands, boyfriends or "xiao bai lians" back home so cut out all the romantic crap and go straight to the "desire" business at hand.

Redbean about the digi cam. When my daughter-in-law heard I wanted a beginner's camera, she said don't buy first, use hers to get a feel of the technology. Later, when I have a better idea of what I want, then shop for a real good one. I ended up with her Sony Cybershot T200. Now I am figuring how to use the contraption. But it sure looks nice!