Singapore Economy: Martin Soong Interviews PM Lee Hsien Loong

Singapore Economy: Martin Soong of CNBC interviews PM Lee Hsien Loong on his views on the Economy

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http://www.propertybuyer.com.sg/viewnews.php?article=85

BIG Stimulus packages included tax cuts and things such as Jobs credit.

First, we think Tax cuts are not really good, because it depletes Tax revenues. Only profitable companies pay taxes, as a result it is tantamount to giving away money to companies that do not yet need it. The benefit is not immediate and of direct benefit to the economy.

Second, we think that the Jobs credit scheme in which it gives a subsidy to the companies with Local and PR employees.
http://www.iras.gov.sg/irashome/jobscredit.aspx
However when faced with a demand slump, the choice of firing an employee or using Jobs credit is clear. The company will fire the employee as jobs credit only probably delay the retrenchments by a while at best. While the jobs credit scheme gives money to companies that are profitable.

MOST WORRYING

Heng Chee Howe said, Jobs credit scheme created employment as Sheng Siong Supermarket expanded 1 more outlet and employed more staff. He seems to imply that Jobs Credit creates employment.

This is the MOST worrying in our opinion. It simply shows that he does not understand the underlying economic issues!!! Job credit does not create employment as employers will go ahead to expand if they think there is demand. If there is no demand, that won't stop them for retrenching workers unless they see the demand fall off as temporary.

We would have bought his argument if he argued that Jobs Credit will give strong companies cash for them to tide over the coming recessions and uncertainty while there are other plans and schemes for helping those companies in trouble.

The fact that he didn't understand that worries us to bits as these are going to be the people that lead us out of recession. Oh god help us.

What have these MPs been up to? Can they even spell the word "Economy"?