After years of dynamic growth and impregnable self-confidence, Singapore has hit the doldrums. The island's economic growth rate -- 9.7 percent at the beginning of last year -- is now negative, Prime Minister Lee Kuan Yew told Singaporeans at the Aug. 9 National Day celebrations.
Major areas of the tiny island's economy -- construction, oil-related industries, finance -- have slowed significantly. And, Mr. Lee warned, the next couple of years could be difficult ones.
But what the government fears most is not a temporary downturn in the economy but a loss of will on the part of Sin- gaporeans, a lapse in the concentration necessary to keep Singapore going. The present economic problems, in fact, seem to have increased the government's doubts about the desirability of parliamentary government.
Lee and the ruling People's Action Party have long had these doubts, but they were deepened by the results of last December's general elections. These brought a 13 percent swing against the government.
The opposition doubled its seats in the Parliament -- from one to two. The People's Action Party has 77 seats.
Most governments would have shrugged this off, but it worries Lee and his party.
The People's Action Party equates its continued rule with political stability and economic responsibility.
Recently, in much quoted speech, the first Depty Prime Minister, Goh Chok Tong, made it clear that he would have no regrets if the party remained in power for the next 25 years, ``better still for the next 50.''
Singapore's leaders feel that their little island of 375 square miles and 2.6 million people is engaged in a constant struggle for survival.
It has no hinterland and no natural resources.
If Singaporeans have survived and prospered so far, the government feels, it was because they were more skilled and disciplined than the competition.
Singapore enjoys one of the highest standards of living in Asia -- with a per capita income of over $5000 -- and three quarters of the population live in government-built housing.
But, observers of Singapore society say, Singaporeans today are probably less grateful to the government, less unquestioningly obedient than they were years ago.
And according to many observers, the government feels that the growing appeal of opposition politics is only the tip of a dangerous iceberg.
Leaders of the People's Action Party regularly remind the public of the bad, old days -- the hard and sometimes violent political struggles that followed the granting of limited self-government from Britain in 1959.
The bad, old days ended abruptly in 1962 when Lee's government rounded up over 100 opposition leaders on the eve of a general election.
Many of these opposition leaders were held captive well into the 1970s, some even later. Lee has claimed that if his rivals, whom he links to the underground Communist Party of Malaya, had taken over, they would have been far less lenient toward their opponents.
The bad, old days could come back, Lee and his colleagues feel, if, for example, Singaporeans become too enamored with a parliamentary opposition.
Even now, People's Action Party leaders, especially Lee, make no effort to hide their distaste for political opposition. It is a luxury they would prefer to do without.
At the moment, the government limits itself to rather heavy-handed efforts at discouraging the practice of voting for opposition candidates.
Last March, for example, the government announced that public housing in areas represented by People's Action Party members of Parliament would receive priority when it came to repair and maintenance.
Further steps in this direction will probably depend on how the economy fares over the next few years. The government apparently hopes that the bad, new days will provide the sort of challenge that toughened an earlier generation of Singaporeans.
The present economic problems stem from a variety of foreign and domestic factors.
Singapore is one of the regional centers for the petroleum industry -- it refines oil and builds and services oil rigs and ships. But the oil industry is in a slump at the moment.
The island has also concentrated on electronics -- until recently a major money earner. But this industry, too, has suffered from the reduced demand from the United States market.
But, Lee said in his Aug. 9 address, a major factor has been the island's ``loss of international competitiveness.'' The costs of doing business, including wages, have simply become too high.
To regain its competitiveness, Lee said, Singaporeans ``must increase productivity and reduce costs.''
Much of the responsibility for the rethinking of economic policy has gone to the younger generation of Singaporean leadership -- men like deputy Prime Minister Goh Chok Tong and Lee's own son, Lee Hsien Loong.
The younger Lee resigned from the Army last year as a 32-year-old brigadier general.
He entered Parliament last December and was given the position of junior minister in two key ministries -- trade and industry, and defense.
The younger Lee's chairing of a special economic committee which has been examining the island's problems has increased speculation that he may be his father's chosen successor.
The older Lee has often talked of retiring at age 65, three years from now. But it is unlikely that he will become totally inactive.
This time last year he was toying with the idea of transforming the purely ceremonial position of president into a more active one.
The president could be directly elected, he suggested, and have powers of veto over some key policy areas. Such a president would have to be a veteran politician, Lee said.
The assumption is that he was thinking of himself.