Foreign Labour & the Singaporean “Free” Market

Ask any MOM official why no concrete action has been taken to overhaul the migrant labour economy, and the consistent, candid answer is, “Leave it to the free market.”

Ah, yes. The fabled free market, land of the holy invisible hand of Adam Smith and inevitable economic outcomes that are blasphemous otherwise. The free market, the sweet automatic mechanism of unrestricted supply and demand powered by self-interest, freeing the state of the burden of command saddled by information asymmetry. And the free market, with the assigned implicit socio-economic function of bringing about an equitable outcome of optimal benefit for the least cost to all agents in the economy.

What they fail (or more accurately refuse) to see is the unassailable existence of free market distortions – particularly the asymmetry of power.

Economic theory assumes that all economic agents are free-willed and fully disposed to pursue the self-interested objective of maximising utility; economic reality shows that not everyone has the capacity to do so.

Capacity of the individual is at the crux of societal and transactional power dynamics. Disempowerment is at the crux of power dynamics and disempowerment precipitates from information asymmetry, access to resources, dependency and poor social skills.

Case in point: a Burmese migrant worker working in Singapore for the first time, dazed by culture shock, language barriers, inability to understand local legal codes and desperation for an income (any income for that matter), is in absolutely no position to demand for higher pay or better working conditions from an employer. Conversely, the employer unhindered by poor enforcement of labour laws, is every way fully capable of exploiting his worker for maximum utility at the most minimal of costs. The failure of the employer to realise that better treatment of his worker may give rise to better work morale and hence great productivity, arises from information asymmetry and this begets inefficiency.

Conclusively, these unchecked free market distortions has rendered the free market far from free but also retarded by inefficiency and inequality.

Beyond just cerebral economic terminology, these problems have immense socio-economic effects that us civil society groups have been trying to fight for so long against all these spurious economic arguments you throw at us.

Your fabled free market is one rife with market failure.

Suck it up, big guy with the iron rice bowl. Time to wake up and stop with your self-preserving, buttock-saving stop-gap measures.

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