With respect to Leaves of Economic Grass, while he has made some valid points, his context is somewhat narrow. The same goes for Noor Yahaya Hamzah whom, I find, seems to understand some things well but fails to see the larger picture. These two are obvious graduates that are articulate and have some strong fundamentals but do not see the whole picture.
The real culprit for our foreign labour problem is productivity. Without higher productivity, there is no way one can start to move away from cheap labour. A more productive general economy in specific sectors cannot only afford but also demand higher wages for services including for menial jobs. This is where Noor Yahaya Hamzah is correct.
However, without higher productivity in general, demand would be lacking and increasing wages would only lead to economic stagnation or destruction of those sectors.
In that sense Leaves of Economic Grass is correct in his ultimate conclusion that the NEP is much to be blamed. The NEP is the biggest drag on productivity in this country. It is the core of problem with subsidies, low labour productivity, low investment in higher productivity activities, addiction to cheap capital and its overemphasis on capital investment.
If you want to go to the crux of it, then the real truth is that our politicians are incapable of solving our productivity problem because of their politics. What that means is that the racial equation of our economy is a drag on its productivity.
Without that productivity, there is no way to end the addiction to foreign labour and the longer the drag is there, the worst the situation becomes just to keep the economy going.
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