Bad idea to lower cost of land

Dear Mr Mah,

I refer to the 17 Apr 2011 Straits Times report of your comments on the Workers’ Party manifesto.

You said lowering cost of land is taking money from Singapore’s reserves. But in the first place, who paid for the high cost of land that fed government coffers? It is the people. The people ended up bearing the high cost of land. So the government has been taking lots of money from the people by charging a very high price for land. Since the people have been charged a very high price to begin with, lowering the cost of land is merely returning money that the government has overcharged to the people.

The cost lowering can be gradual so that its impact on resale flat price can be slow and gradual. Notice that the Workers’ Party did not advocate a sudden return of price back to normal. Contrast this with the PAP track record of allowing property prices to shoot up like a rocket in a matter of just two, three years. Shoot up like crazy can, go down slowly cannot. The reason is clear. You want the price to keep going up because that will allow the government to squeeze more money from the people to feed government coffers which end up being wasted by our state investment agencies anyway.

You said it would cost the government billions to lower the prices from current levels. Doesn’t that in turn tell us that the government has been making billions from the people by hiking prices to their current levels? You seem to be telling the people that government taking billions from the people is okay but government returning billions back to the people is not okay.

You said lowering prices means home owners’ assets cannot grow over time. Are you telling the people that asset values can miraculously grow over time without having anyone to pay for it? You are telling people that money can drop from the sky out of nowhere. Money cannot drop from out of nowhere. Growing asset values means growing asset prices that will be borne by our children and our children’s children. You are robbing our future generations to pay for the present and past generations. You are irresponsible.

You said money from land sales goes into our reserves and is therefore not money from left pocket to right pocket. But PM Lee has just dipped generously into the reserves during the recent crisis. So the reserve is another pocket that the government can slip its hands into. No doubt the government has to ask the President permission. But has the President ever said no?

You claim that the Workers’ Party’s plan of abolishing the elected presidency is a grand plan to ‘raid’ the reserves. But PM Lee has already ‘raided’ the reserves during the recent crisis. With such an accommodating president, why is there a need to abolish the elected presidency just to raid the reserves?

You want the opposition to make clear how they are going to get the money to reduce home prices. But you never seemed to see the need to make clear how the government is getting all that money from the people by jacking up home prices.

Thank you

Ng Kok Lim

Source : TheTemesakReview – 30 Apr 2011