While busily arguing with the Workers Party, Mah slipped up and uttered a blooper. He said that he was "proud" of Singapore's asset enhancement policy.
People who understand this topic will remember Mah's statement, long after the 2011 elections are over. For this statement is a very naive and foolish one.
If you are too young to know what the AE policy is all about, just click here to read Tan Kin Lian's old post. His explanation is simple, short and sweet.
Essentially, the AE policy makes HDB flats more expensive. According to Mah, this is a good thing because your home becomes more valuable.
For most Singaporeans, this statement is largely nonsense. That's because people need homes. If you cash out by selling your flat, you still have to buy another home. If you buy a similar home, it will cost as much. So obviously, the AE policy is not making you rich.
(God, this Mah person drives me crazy. To think that I have to explain such obvious things on my blog).
The real danger of the AE policy is that it will seriously drain your CPF savings. First, let's get back to basics. Recall that the main purpose of the CPF is to help you to save for your own retirement.
This is especially crucial in Singapore, because the government here (unlike most developed countries) has no safety net for the old. You have to look after you, in your own old age.
However, the government also encourages you to use your CPF to pay for your HDB flat. In fact, after all these years of stagnant wage growth, many Singaporeans would not be able to pay for their HDB flats, if they were not allowed to use their CPF.
Now, as the AE makes HDB flats more and more expensive, what does that mean? You will be forced to use more and more of your CPF money to pay for your HDB. In turn, that means you have less and less money for your retirement.
That is why older Singaporeans are often said to be "asset rich, cash poor". They have a roof over the heads, and it might even be a very nice roof. But they have little money to meet their everyday needs, and many of them will have no viable option to monetise their home.
(Please note that I do not consider selling your home and living in the void deck as a "viable option").
That is also why in recent years, the government keeps reiterating that you need to save more for your retirement, and that your CPF money is not going to be enough, for your old age.
For it is true. The asset enhancement policy (which Mah is so proud of) is steadily making the CPF system a failure.