1 minute with: Dr. Steven Peng

 

Dr. Steven Peng, 43, is an economist. He does not wish to name the agency he works for.

 

Progressive Wage, minimum wage – so many wage models being discussed following the implementation of the Progressive Wage Model in Singapore by the NTUC.

We asked quizzed Dr. Peng over a quick lunch on his thoughts about wage models in the US and here.

FS: In your perspective, which wage system works best?
SP: There is no perfect wage system. I always see the world as, on one hand, we have minimum wage systems. On the other extreme, you have Collective Agreements (CA, legal agreements negotiated with management by unions).
CAs are definitely the best one can aim for, for it takes care of not just wages, but benefits as well. Singapore’s Progressive Wage lies somewhere in between these, as is the Australian system of industrial awards.

FS: How does a country like the United States raise minimum wage?
SP: The US system is definitely much more different than ours. Obama is thinking of pressing alone on this rather than seeking support from Congress which has 2 houses: the House of Representatives and the Senate. To pass a law, it has to pass through the 2 houses as well as the president’s office. With different parties “owning” the infrastructure now, this is not seen to be easy. They also do not have a structure with historic standing like the National Wages Council.

FS: Why can’t Singapore just follow the American wage model?
SP: This is a bit more nebulous. The economy composition is definitely different and it is very difficult to map the world’s largest economy with one of the world’s most open. The similarity is probably in terms of the financial market infrastructure, but this alone is meaningless to compare as the US also has strong agricultural and industrial production capabilities.

FS: So what works for them, may not work for us?
SP: I think the most important point from this article is that every country’s political, economic and social situations are different, and that purely asking for a transplant of a wage system from country A to country B is hazardous and illogical. Such issues are more like literature than maths. In maths, even for things that are infinite, we can agree on, eg. the value of Pi is universally taken to be 3.14 even though we cannot pin its actual value. But in literature, a phrase as simple as “If music be the food of love, play on” can be interpreted to mean different things to different people and yet all of the interpretations can be correct.

 

 

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