PHOTOGRAPHS FOR TIME BY JOHN STANMEYER/VII

The highrise office buildings of Singapore's central business district are symbols of the city-state's recent prosperity

The Lion In Winter
	After years of prosperity, Singapore's economic success formula is failing—and citizens of the "nanny state" are being told it's time to leave the comfort zone
	By Simon Elegant Singapore

Posted Monday, June 30, 2003; 21:00 HKT
Simon Toh seems to have it all. he's sitting at the dining table in a spacious two-story house patiently helping his six-year-old, Samantha, with her spelling homework. His wife, Dilcy, whose barely swollen belly and slight glow are the only signs she is expecting their third child in a few months, sits watching a soap opera on a huge rear-projection TV. Their youngest, Stephanie, scampers around the living room while an Indonesian maid unobtrusively serves cold drinks and clears dishes. From the neat garden outside—a rarity in crowded Singapore—comes the soothing sound of a waterfall.

But despite his prosperous and settled appearance, this 39-year-old management consultant is being buffeted by forces far beyond his control. Toh, whose last steady job was with one of the world's largest consulting firms, PricewaterhouseCoopers, hasn't worked in nearly a year. Squeezed for cash, he was forced to sell his apartment and move his family in with his in-laws. He says he has sent out hundreds of résumés and had scores of job interviews, but even though he is ready to try anything, he is considered either too qualified or not qualified enough. Solid jobs with big-name firms such as PricewaterhouseCoopers—or Deloitte Touche Tohmatsu, another huge multinational Toh once worked for—have dwindled in Singapore, and Toh worries they are gone for good. "I'm not pessimistic, just realistic," he says. "We just might not have the resources, either personal or national, to go forward."

To the casual visitor flying into Singapore, such gloom seems absurd. The wealthy city-state still thrums with technocratic efficiency. But beneath the gloss of its modern skyline, an unprecedented economic downturn has produced the worst identity crisis since the traumatic 1960s, when the island gained independence from Britain. The body blow the economy took from SARS—Prime Minister Goh Chok Tong recently warned of a possible recession in 2003—has confirmed Singaporeans' worst fears about their future. Accustomed to defining themselves by their country's extraordinary commercial successes over the past four decades, they now confront the possibility that hard work and talent may not be enough, that history and geography can rob a nation of its wealth as fast as it was earned. "It sometimes seems as though Singapore's best days are over," one Singaporean accountant in his late 20s says. "Now we have to run as hard as we can just to stay in the same place."

The country's famously farsighted but heavy-handed leadership is all too aware of the challenges the nation faces in struggling to invent a new economic formula. "If you can't evolve, big as you are or prosperous as you may be, you die like the dinosaurs," Prime Minister Goh tells Time. "We have got to sound a warning, to get Singaporeans to be aware of what's going on around them, and then to change and adapt." Of course, other Asian economies face tough challenges, too. The war in Iraq and SARS have weakened key sectors, such as tourism and retail. And economies from Japan to Malaysia are under competitive pressure from China, the world's rising manufacturing superpower.

But many Singaporeans believe their troubles go beyond transient business-cycle fluctuations and threaten the very foundation on which this "artificial nation," as one senior Singaporean politician puts it, was built. Once consistently among the world's fastest-growing economies, Singapore has stumbled in and out of recession since the Asian financial crisis of 1997. Despite having kept its financial house in order—free of corruption and boasting huge trade surpluses, vast foreign-exchange reserves (some $80 billion at last count) and minimal public or private debt—Singapore has been sideswiped by the economic transgressions of neighbors such as Indonesia, a major trading partner. Then, two years ago, just as the country finally appeared to be recovering, the technology bubble burst, causing a precipitous drop in the market for Singapore's main product, electronics. This catastrophe was swiftly followed by another: roiling uncertainty caused by the terrorist attacks of Sept. 11, 2001.

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