The Obvious Answer to Cheaper Hawker Food

I’ve just seen an article in the Today Newspaper entitled “Keep hawker food affordable.” The article is essentially a complaint about how basic hawker food has shot up in price and as with most Singaporean letters to the press, the implicit message that the government should do something about it – which in this case was a call for the National Environment Agency (NEA) to regulate the price of hawker food. The article can be found at:

https://www.todayonline.com/voices/keep-hawker-food-affordable

I agree that hawker food should be kept affordable. Speaking as someone who has spent seven-years of his life in a Western Restaurant, I can easily say that hawker food is one of the best things about living in this part of the world. If you go to the right stall, you can get an exceedingly tasty meal for a few bucks.

For me, the hawker symbolizes what Singapore should be – a small time businessman delivering a magical product out of nothing (a former guardian of mine once said he was not impressed with the man who could cook fillet steak, the meat is so good you got to be clever to mess it up. By comparison, the man who cook kway teow – its just a bunch of noodles, shit clams and yet taste like magic.). These are the guys who make Singapore tick.

What I disagree with is, the solution of the government telling business people what they can and cannot charge. We live in a capitalist system where setting up a business is a costly time-consuming exercise. We preach that anyone who sets up a business face to bare the very real possibility that they are doomed to fail and lose their shirts but if the business succeeds, they should reap the rewards. We recognize that people who set up businesses ad value to society by doing things like giving society a product or service and for employing people. A businessperson has to bare certain costs and how much they make above their costs (assuming they can make above costs) depends on what people are willing to pay. Getting the government to tell businesses what they can charge should be an anathema to most normal people, particularly when the said government is not about to make the costs of doing any business lesser.

Perhaps the question is not so much keeping hawker food affordable but asking us how we can make running a hawker stall more affordable. Unfortunately, the question won’t be addressed because the most obvious place to start is the rents that businesses pay. After working in liquidations for the last five-years, one tends to notice that the landlord is inevitably one of the largest and most powerful creditors. If there is a cost that will never go down, its inevitably going to be the rent.

To be fair to Singapore’s landlords, there is an obvious business case. Singapore is a tinny place with lots of people. Land is scarce and as a scarce product, its inevitably doing to be expensive. In fairness to Singapore’s government, they’ve been pretty good at allocating land for the various sectors in society. Despite being densely populated, Singapore has open parks and spaces, which the population density might not suggests. The price of land in Singapore is like pretty much elsewhere that happens to be small and dense. Hong Kong also has high rents and houses are tinny.

However, there is one issue that nobody seems to be addressing – namely the fact that the government in Singapore is the largest landlord – thus the areas used by many businesses are inevitably under the control of an organization that does not rely solely on rents from small time stall holders.

What’s more interesting is the fact that the government in its role as landlord to businesses, owns most of the land that the hawkers operate in.

If there is a solution to rising costs, it would be to hold down rents. Holding down the rents for hawker stalls would help to keep costs lower for hawkers and other small enterprises. It would help make life more affordable for businesses and the public at large. This would go further than one of payments in the budget. The simple act of not raising rents in areas controlled by the government would have great benefits for society – government would inevitably gain to as a more prosperous citizenry would have more taxes to pay to the government. The landlord with the power to do the obvious, should do it.