Battle Hymn of the Tiger Country: The Story of Singapore

My latest read was From Third World to First, the story of Singapore’s transformation from a developing to a developed nation. Written by Lee Kuan Yew, the first prime minister of Singapore, this book recounts his experiences governing Singapore during its rapid rise to become an Asian Tiger.

In 1819, what we now call Singapore was just a small island home to a few dozen fisherman. The strategic position of the island made it attractive to the British, who absorbed the island for use as a shipping outpost. For the next 146 years, Singapore remained an outpost of the British Empire until its independence in 1965.

Yew took the helm when Singapore became independent; he ended up ruling Singapore from 1965 to 1990. In his book, he details the struggles of the early years. With the exit of the British, Singapore had to build up its own military to protect against hostile neighbors. There was also the issue of violent race riots that threatened to split the country into Malaysian and Chinese regions.

After getting through the rough start, Yew's focus turned to economic issues: Now that the social and national security problems were largely under control, how could this tiny resource-poor densely-populated country sustain itself?

All in all, From Third World to First is a great read for anyone interested in a rags-to-riches story where the sympathetic protagonist is a country. Yew takes the magic out of the rise of this Asian Tiger, though that doesn't make Singapore's progress less remarkable.

In Singapore, government involvement in economic development is extensive. The Singapore government took the lead in spurring new industries with public-private enterprises. The deep public-private ties would be anathema to many a Western free-market capitalist. One example is Singapore Airlines, a highly-profitable and globally-competitive subsidiary of the Singapore Government with extensive oversight by government officials. When you compare Singapore Airlines to the flop of Air Canada, you begin to wonder how the Singapore government succeeded where the Canadian government failed. Yew places much credit on the success of Singapore’s private-public enterprises on that fact that government officials in charge had a clear mandate: Make it Profitable, or Shut it Down.

Yew also emphasizes the importance of selecting a high-quality civil service. As he puts it, "The key to [Singapore's] success was the quality of the people in charge." In Singapore, government officials are extremely well-paid (by our standards), which Yew argues attracts recruits and reduces corruption. Candidates for important positions are extensively analyzed: Their academic record, achievements at work and “character” are all vetted. Yew mentions that he decided to evaluate “character” through the use of psychological testing after watching Apollo 13. Apparently, Yew was impressed with how calm the Apollo 13 astronauts were in spite of their peril; this impelled him to adopt NASA-style psychological testing to government recruits.

On social issues, Singapore has government intervention that would be anathema in the Western world. At one point, Singapore banned the importation and sale of chewing gum in order to combat "gum wad" vandalism. Another time, the government created a "Social Development Unit" to facilitate socializing between male and female graduates in the hopes of encouraging marriage; Yew had been concerned that "male graduates who married less-educated women were not maximizing the chances of having children who make it to university".

In terms of governing style, what impressed me about Yew is that he was never a prisoner to any theory. When he made decisions, he did not ask what could work, he asked what did work. And to learn what did work, Yew did not shy from learning from those who got it right. As he put it,

"I discovered early in office that there were few problems confronting me in government that other governments had not met and solved. So I made a practice of finding out who else had met the problem we faced, how they had tackled it, and how successful they had been."

This statement reminds me of an article on healthcare reform by Atul Gawande, where Gawande wonders if maybe the best way to discover the "best" healthcare system for America is too run a bunch of small-scale experiments with different models to see what works.

Singapore's development is impressive, and much of its success is attributable to Lee Kuan Yew's political and analytical skills. At the same time though, I wonder how portable Yew's lessons are to a larger state. A lot of the wildly successful economies in Asia have been the city-states: Taiwan, Hong Kong and Singapore. Are the good practices of Singapore workable in a country on the scale of America, or even Canada? Besides size differences, social, cultural and geopolitical differences may have played a key role in Singapore's success, though that’s an issue for an economics thesis.


Software patents and shorter Marty Goetz

Shorter Marty Goetz: Software is valuable, therefore it should be patentable.

Goetz was the recipient of the first U.S. software patent ever awarded. In this ZDnet article, he defends software patents, where his basic argument is that software deserves patent protection because software development is a billion-dollar industry. For several reasons, Goetz fails to make a persuasive argument for software patents.

To begin, why do we even have a patent system? The patent system gives the inventor of a useful device a limited right to use the government to protect against unauthorized copying. The benefit to society is that patents encourage innovation: people are more likely to invent if they know a competitor can’t free-ride on their efforts. The limited term of a patent ensures that today’s protections do not prevent tomorrow’s inventions.

Going back to Goetz’s article, in some sloppy sense, yes, patents are meant to protect things that are "valuable": They should cover socially desirable inventions that are unlikely to come about without protections against free-riding.

But things are not that simple when it comes to software patents. First, it is unclear whether patent protection would encourage innovation in the software industry. Programmers might write useful software even without patent protection.

Even if patents could spur software innovation, the system may be too difficult to administer. If writing a piece of software and reducing it to practice is easier than making a physical widget, software patents will add to the patent office backlog. If figuring out whether software is novel, useful and non-obvious is more difficult because of the abstract nature of programming, software patents will add to the court dockets.

Software patents may also hinder future innovation. A great weakness of software patents is the difficulty of due diligence: There is no easy way to determine if a program is infringing on earlier patents, and the risk of litigation may deter innovation.

These are just a few issues ignored by Goetz, though any argument for software patents should address them.

The closest thing Goetz has to an argument is his point that because "software and hardware circuitry are interchangeable", it makes no sense to allow patents for one and not the other. For example, there are many functions that can be implemented in both software and hardware, such as FFTs in cell phones. Goetz argues that because the same amount of effort goes into the software and hardware implementation, patents should be available for both.

What Goetz ignores is that a patent issued on a hardware implementation does not cover the mathematics behind it. The patent protects only the physical device from copying, not the abstract ideas that make it work. One benefit of limiting patent protection to a physical device is that it makes it easier to define the bounds of the invention. The clearer the boundaries, the less litigation.

A more subtle benefit of tying patent protection to a tangible product is that it increases the likelihood that the invention is truly novel. The more abstract the patent, the more likely the device was independently invented, and vice-versa. Reducing an idea to physical form requires additional effort that narrows the field of possible inventors.

In sum, Goetz doesn’t make a strong case for software patents. Of course, there are alternative ways to protect software from free-riding: Most notably, via trade secrets and copyright. Whatever approach is chosen, let’s hope it relies on a more compelling argument than "software is valuable, therefore it should be patentable".