CPF: Can the government protect stupid people from their own stupidity?

Hello everyone. I have had a lot of traffic to my blog further to my last post on the CPF minimum sum issue, I would just like to do a follow up and answer a question by someone who left a comment on the TRS website where my article was reproduced. Now allow me to categorically state that I am not attacking or criticizing Jonathan Ng who made this suggestion, I think that it is a very good thing that he is actually trying to come up with solutions and new ideas rather than simply accept the current situation as an inevitable conclusion. I wanted to respond to his suggestion to demonstrate just how tricky the situation is - so here is Jonathan's suggestion to kick us off.

"To be honest, we have to look at matters from different perspectives. Of course, the money will come in handy to families that wanted to send a child for overseas studies (due to not meeting the local Uni standards), medical bills (which i feel the government can try to subsidizes further for major illness), etc. But greed of some will harbour on those who have these excess funds, whereby when these funds is depleted, it will be like the mentioned Indian lady example. When numbers are overwhelming, it will becomes a social problem, whereby people will start to blame the government again. Suggestion is that CPF will need to adopt a case by case basis whereby the needs of their MEMBERS to deem whether the withdrawal of excess funds is allowed for this reason, whereby i reckon will be more appropriate."

"Please sir, may I make a withdrawal from my CPF?"

Okay, so what Jonathan is suggesting is that there should be a panel of people employed by the government who should decide on a case by case basis whether their request to withdraw their funds is justified and reasonable - who should sit on such a panel then? On what basis should they base their decision then? If you're not happy with their decision, who can you appeal to in that case? Let me give you an example to illustrate how tricky this situation can be, even if you do have the very best of intentions to protect the interests of the citizens by safeguarding their life savings.

Jonathan mentioned the example of a family who wants to use their CPF funds to send a child overseas for university as the child is unable to gain admission to a local university. Let's run with that analogy, after all, education is important to everyone, right? Surely it is the right of every parent to help their child get a decent education, to go to university so that the child can get a good job, right? It may seem simple, but allow me to present a tricky situation for you to look at. Suppose we have one such Singaporean family and the son "Ah Boy" has done really badly for his A levels and has no hope of getting into a local university. Hence Ah Boy has applied to universities in the UK and because his grades are so bad, the only university willing to grant this student a place is Bolton University, which is ranked 121st out of 123 universities in the UK (2014 rankings). It is a dreadful university. Do you approve this application for a CPF withdrawal, knowing that Ah Boy's degree from Bolton university is not going to be worth the paper it is printed on?

Should you go to university at all costs? Even Bolton University?

Let's put some figures on it, I refer you to this link as my source for my figures. A three-year programme at Bolton can cost approximately £18,759 a year (fees + living costs) and that works out to £56,277. Oh and we haven't added flights to and from Singapore yet. Let's add three return flights to Singapore and round that figure up to £60,000. That is S$126,000 - not a huge amount of money for a rich family (heck, rich families will not even need to dip into their CPF to spend that amount of money to buy a car, for example), but for a poorer, low-income family, S$126,000 could represent many years of savings. Furthermore, it doesn't matter whether you're going to Oxford or Bolton University, you don't get a discount just because you're going to a crap university at the bottom of the league table  Let's imagine if Ah Boy's family is a low-income family, his parents work in a hawker centre and that S$126,000 represents a sizable chunk of their CPF, would you still allow them to spend it on a useless degree for Ah Boy? Or would you say no and ask them to consider alternative options for Ah Boy's education? 

If the decision maker was genuinely trying to protect the interests of Ah Boy's parents and safeguard their CPF savings, can you see how they would find themselves in a moral dilemma? Ah Boy's parents really want their son to have a degree at all costs and are willing to make sacrifices for it - they do realize that Bolton university isn't a reputable university but they still want to go ahead with it.  If this application was for the child to go to a very good university at the top of the league tables like Oxford or Cambridge university, then fair enough (one would say yes immediately), but what about Bolton? Furthermore, if you knew that the child wanted to study somehing useless like art history, philosophy or any of the ridiculous degrees listed here, these are course with very poor employment prospects: would this colour your judgement, knowing that this degree is not going to help the poor kid find a job? 

Will your degree help you get a good job? It depends on which university you went to.

Or, am I simply being elitist here? Am I doing the 'get out of my elite uncaring face' routine here?  Am I discriminating against students who are not academically gifted and simply cannot get straight As? Do students with poor grades have the right to pursue a degree at a less demanding university without the rest of us telling them that they are simply wasting their time and money? Should parents have the right to send their children to whatever university they desire without a third party passing judgement on whether it is a good or bad decision? Whose decision should that be when it is ultimately the parents (and not the state) paying for their child's degree?

Let's run with this analogy: imagine if the decision was to allow Ah Boy's parents to use their CPF money to send their son to Bolton university, he uses up S$126,000 of their savings and returns to Singapore three years later. Ah Boy's degree is useless and he is unable to get a job and is still financially dependent on his parents for years. His parents then complain, "why didn't the CPF board stop me from making that bad decision, from spending my hard earned money on a useless degree for my son? I work in a hawker centre, I am not educated, I don't understand how universities in Britain work - I expected the people at CPF board to have stopped me from making a bad decision like that! Why didn't they stop me from making that mistake? I want my money back, give me back my $126,000! How am I supposed to retire now if my son cannot find a job with that degree? I have to keep working to support my son now, instead of him being able to support his two elderly parents!" Oh dear. Talk about a tricky situation, eh? 

If you have a crap degree, don't expect it to help you find a job.

This presents a moral dilemma for anyone trying to make a judgement call on this case. Perhaps Bolton University is a rather extreme example - how about South Wales University (ranked 100th out of 123), Chichester University (ranked 76th out of 123) or Dundee University (ranked 49th out of 123)? Who gets to decide where you draw the line? You can't win either way - simply because you cannot treat education as a monolithic entity. A degree from Bolton university is not worth as much as a degree from Oxford or Cambridge but are you prepared to tell Ah Boy's parents that they are about to make a very bad decision and face their anger, because you're denying their son a chance to get a degree? Would the government want to put themselves in such a position? Clearly not. 

Let's deal with another one of Jonathan's suggestions: allowing Singaporeans to use their CPF for medical bills. Surely medical bills - that has got to be less controversial than education, right? Well what kind of medical bills then? Imagine if Mrs Pui is very fat and she wants to use her CPF savings to get liposuction to shed all that fat overnight, she literally wants the plastic surgeon to suck all that fat out of her so she can be thin. Her doctor has told her that she can lose weight the normal way: by simply adopting a far more healthy diet and exercising daily - liposuction is but a cosmetic surgery and it is an expensive option that Mrs Pui can't afford without dipping into her CPF. However, Mrs Pui hates the idea of diets and loathes any kind of exercise - she would much rather just go for liposuction. So, should Mrs Pui be granted the right to use her CPF savings for this expensive liposuction operation? Would you say yes or no to Mrs Pui's request? Let's make the case more complicated - what if Mrs Pui had to lose weight urgently otherwise she would put her health at risk, being so severely overweight. Would that then make her plea for liposuction more justified, or would you still insist that she eats only beansprouts and goes swimming for a few hours everyday? 

Should Mrs Pui be allowed to get liposuction with her CPF savings?

In both cases, there are no simple answers: it would be very difficult decision to make. Any government who puts themselves in that kind of position would risk becoming extremely unpopular if they started saying no to people like Ah Boy's parents and Mrs Pui, even if it was done with the best intentions to protect their CPF savings. So imagine if the government said no Ah Boy's parents, there would be a huge public uproar about discrimination and elitism. But if the government then caved into pressure and said yes to Ah Boy's parents, then what is the point of such a panel when you still allow people to waste vast amounts of money on useless degrees like that? 

This then becomes a thankless task which puts the government in a very difficult position, it is a game that they simply cannot win and will not play. It's as simple as that - it will not win them votes, it will not help them gain popularity. I know what Jonathan is thinking - he wants to protect stupid people from their own stupidity. We have all seen the example of the Malaysian widow squander a million dollars just like that but my point is simple: no, you cannot save stupid people from their own stupidity. This has nothing to do with your noble intentions, it has got to do with the nature of stupidity.

It's not a question of wrong or right, but rather what you can practically achieve.

In the case of this Malaysian widow, the bulk of her windfall was wasted in a bad investment - she had invested in her brother's transport business which turned out to be a complete failure. So you see, even in this case, it isn't that straight forward at all - her justification was that if the business turned out to be a success, she would become a business owner and would be able to reap the profits for years to come. That business could potentially generate a steady stream of income for her children for many years, if it was successful - her reasoning seemed to have made sense on the surface. Now it is evident that her brother had a poor business plan, that is why his business went bust - but where do you draw the line then? Do you propose that the Malaysian government (don't forget the widow is a Malaysian citizen) should have stopped her from investing in her brother's business? Or that her brother should have been prevented from even starting a business venture in the first place? When does protecting stupid from their own stupidity become an infringement on their freedom?

In the case of the Malaysian widow - there was no evil crook out to swindle her of her insurance money. Her brother was guilty of no more than sheer stupidity, there was no malice on his part. Despite his best intentions, his business plan failed and neither him or the widow made any money out of the failed transport business. These were two stupid people with no business acumen, making poor business decisions without a decent business plan and whilst it was a recipe for disaster, there were no evil villains involved here. Guess what? When you have two clueless people trying to start a business like that, you don't need an evil villain for things to go very, very wrong. Such is real life for you - so as I have mentioned in my previous post about the Chee Koh Pek, Singaporeans are creating a villain in the form of the foreign gold digger when really, such a villain does not exist. It is easier for Singaporeans to pretend there is an evil villain to be defeated, rather than to tackle the challenges of saving stupid people from their own stupidity.

Singaporeans like to create a villain to blame for their woes.

It is hard for Singaporeans to get their heads around a problem like "stupidity" - in fact, it is almost socially taboo to talk about stupidity or even to use the word stupid. I had offended one of my dear readers Winkingdoll last year when I chose to use the word 'stupid' in one of my posts and she got really very angry about it (despite the fact that I was not directing that word at her, but simply using it to describe some people I had encountered). For her, my use of the word 'stupid' it was so offensive it was on par with homophobia or racism, it was blatant discrimination against people of lower IQ. Her attitude is not unique, it does make it very hard for us to deal with the issue of helping (for want of a better word) 'stupid' people if we can't even mention the word 'stupid'.

Can we solve a problem like stupidity? No. Can we save stupid people from their own stupidity? You can try, but it won't be easy.Such it human nature - you can't eradicate stupidity. Should you treat everyone like a complete idiot, incapable of managing their own finances and base your CPF rules on the most stupid idiot in Singapore? Certainly not - that won't be fair to the vast majority of Singaporeans. Besides, even stupid people have feelings too and stupid people get to vote as well, imagine if the government starts vetoing the decisions stupid people want to make in their private lives to save them from their own stupidity, how would that make make them feel towards the government? Jonathan, don't take it personally when I say that what you have proposed (setting up a panel to judge each CPF withdrawal on a case by case basis) is impractical and simply not feasible The vast majority of Singaporeans are perfectly capable of making sound, rational decisions when it comes to their own money and neither welcome or need the intervention of the state when it comes to their decisions. Being stupid is a bit like being dead: you're not aware of it but everyone else around you is. Likewise, did you think that this Malaysian widow was aware of just how bad her decisions were? No, she clearly didn't otherwise she would have acted differently. It was only hindsight that revealed how terrible her mistakes were. 

Fact of life: stupid people exist. Mother nature created them.

Well what about the stupid people then? How about a dose of reality here: no, you can't help them. Not like that at least. Not through the CPF system. They will suffer from their own stupidity and you cannot expect the state to step in and function like their parents. It is just not feasible or practical on any level - mostly because it would make the government extremely unpopular. You wanna help poor people - great, there are plenty of charities that help the underprivileged and you can help contribute to those charities. Direct your help at those who are poor, but don't treat everyone as if they are idiots who are incapable of making rational decisions. 

Furthermore, you cannot impose your help on those who do not want your help. They will only protest, resent your interference and hate you for trying to intervene when they clearly do not want any external help. You can bring a horse to water but you cannot make it drink - likewise, in the case of the Malaysian widow who squandered her million, she did receive excellent financial advice from Changi Airport Group (CAG) financial adviser who told her exactly what she ought to do with the money she was give. She wasn't just given a million bucks without any financial advice, she was even able to recall exactly what she was advised when interviewed by the ST journalist. 

"The CAG financial adviser advised me to divide the money between myself and my four children. After allocating $200,000 to each of my four children, I was left with $150,000," she said. A CAG spokesman told The Sunday Times the CAG had arranged for a family counsellor for Madam Pusparani and had also engaged a financial services adviser to help her with the money she received, including setting up an annuity plan for her children. "I was told not to touch my children's money as it was meant for their future," she said, adding that the financial adviser also suggested she could use the remaining money to set up a small business in Malaysia.

Did she follow the good advice she was given? No, she squandered the money instead. This is a clear example of how you can't help someone who doesn't want to accept your help and there are many people like this Malaysian widow. What can you do about them? I don't blame the government. I don't even blame the stupid people for being stupid. This is just life - c'est la vie, some people will be born quite stupid and are incapable of making intelligent decisions. I simply accept that life isn't fair, society isn't going to be equal and I certainly do not expect the government to try to go out of their way to protect stupid people from their stupidity. That is a highly unreasonable demand to make on the government and I would never expect my government to solve problems like that - especially in a place like Singapore. Allow me to show you the view from my living room window on this sunny summer's day - quite a nice view eh? 

Yes you may be able to pick out some of London's famous landmarks like the Shard, Big Ben and the London Eye in the distance - it is a magnificent view of central London from the 15th floor. When I showed my mother this view (via Skype), she was shocked. "Aiyoh so dangerous!" And I was like, what the hell are you talking about, what is dangerous? Why your window no grille one? So high up you must have grille!" I explained to her that because I was on the 15th floor, only Spiderman could climb into my window if I had left it open - it was very safe. I had imagine window grilles to have been necessary perhaps in HDB flats where you have windows facing the corridor, but in my case, my block was not built that way and I didn't need window grilles.

"No lah, what if you fall out of the window? Can die one leh." My mother persisted. And I was like, come on, what are the chances of me falling out of my window? I have lived here for 10 years and have enough common sense not to even put myself in a position where I risked falling out of the window. I certainly have no desire to fall 15 floors to my death, that is enough motivation for me to behave in a sensible and responsible manner, so I don't need window grilles to protect me. My mother was not convinced though, "but better safe than sorry lah, what if got stupid people live in your block and they are careless, then they lean out and fall out and die then how?" Great. Is that how you Singaporeans think? Treat everyone like idiots just because idiots exists? Are you willing to be treated like an idiot just because idiots exists? This reminds me of that great "stupidity tax" speech by Edina Monsoon from the comedy Ab Fab.

Eddie: Yes, Yes!... Why, oh why, do we pay taxes, hmmm? I mean, just to have bloody parking restrictions- and BUGGERY-UGLY traffic wardens, and BOLLOCKY-pedestrian-BLOODY-crossings?... and those BASTARD railings outside shops windows, making it so difficult, so you can't even get in them! I mean, I know they're there to stop stupid people running into the street and killing themselves! But we're not all stupid! We don't all need nurse-maiding. I mean, why not just have a Stupidity Tax? Just tax the stupid people!

Patsy: [stands up] And let them DIE!

Eddie: Yes!

I clearly don't agree with the CPF minimum sum but I can clearly see why the government cannot use Jonathan Ng's suggestion of considering withdrawals on a case by case basis. Why? Because you can't deal with stupid people like that. Whilst I want to encourage Singaporeans to try to come up with alternatives to what the PAP is proposing, I want to point out that you're facing a huge challenge here and you cannot make ridiculous, unreasonable demands on your government. It almost seems ironic that it appears that I, of all people, am defending the PAP on the issue of CPF - but when people like Jonathan Ng come up with such ridiculous suggestions, that's the PAP's cue to say, "see lah? Alamak. How on earth is that ever going to work? Aiyoh. What a dumb idea. This is why the PAP knows best," 

Come on people, you wanna take on the PAP, you have gotta try harder than that. If you think you can come up with any better ideas, then please, that's what the comments section below is for. Thank you very much for reading.