When his ruling party won all but two of the 84 seats up for grabs in parliamentary elections nine years ago, Lee Kuan Yew, the founder of modern Singapore, declared: “Please do not assume that you can change governments. Young people don’t understand this.”

Fast forward to today, and things are changing in this high-tech city-state.

For one, people here are facing the prospect of a Singapore without Lee.

Now 91, the elder statesman was hospitalized with pneumonia at the beginning of February and placed on a ventilator. The office of the prime minister — Lee’s oldest son, Lee Hsien Loong — said Tuesday that his condition had worsened due to an infection and on Wednesday said that he had deteriorated further and he was critically ill in the intensive care unit.

Although Lee has been ill before and rebounded, there is a sense here that this time is more serious and that Singapore might, on the 50th anniversary of its independence, be marking another historic moment.

After becoming the south-east Asian island’s first prime minister in 1959, Lee oversaw its independence from Britain and Malaysia, then used a far-sighted economic vision and an iron fist to transform Singapore from a third-world colonial trading post into a glittering, multicultural commercial hub.

This was done by encouraging business with easy regulations and low taxes, and using big government to look after citizens. But progress was made at the expense of civil liberties, with the media stifled — often through libel suits — and political dissent barely tolerated.

Although his three-decade reign as prime minister ended in 1990, he held the advisory positions until four years ago and has continued to exert his influence both through his son, who became prime minister in 2004, and his People’s Action Party, which has a stranglehold on the parliament.

“Just like all the great men who built south-east Asia in the postcolonial period, Lee Kuan Yew is a presence for as long as he breathes,” said Ernest Bower, chair for south-east Asia at the Center for Strategic and International Studies.

“Singapore is now looking for change and evolution,” Bower said, “but they're not sure. I think there's a little bit of fear and anxiety about all of this.”

Even Loong, the current prime minister, acknowledges that Singapore is at an “inflection point”.

While older people here remember what life was like before the transformation and were willing to put up with the restrictions, people in their 20s and 30s are increasingly not.

“Previous generations had all their necessities taken care of and were happy with [Lee] when he was prime minister,” said Abdul Kadir bin Ibrahim, a Singaporean in his 50s who runs a clothing store in the Arab Street district.

The younger generation is more outspoken, he said. “Most of them are highly educated and they come from families where they have not had to struggle to survive and they have been more exposed to the outside world, so it’s inevitable that there will be some change.”

Carlton Tan, a local journalist, is one of those younger Singaporeans who has mixed feelings about the anticipated demise of a man he called a “likeable despot”.

“We simultaneously love and hate, respect and despise, cherish and abhor, the man,” he wrote in a recent column. “We are thankful for our decades of economic progress, but we wonder whether it was really necessary to sacrifice our freedoms. We are grateful for the stability and security, but we wonder whether we can maintain it without a strong civil society.”

Now, Singaporeans can honor their founding father by “asking tough questions, making hard choices, and imagining a different Singapore,” Tan said.

An opportunity to vote for a different Singapore is approaching.

During the last general elections in 2011, the ruling party lost six of 87 parliamentary seats — a result that was considered an omen of change. The opposition is expected to win more seats in elections to be held next year.

Political changes are being accelerated by economic ones as income disparities have widened. The number of billionaires is rising, while a quarter of the population lives below the poverty line and increasingly struggles to afford the basics.

Immigration is also a pressing issue. Foreigners comprise a third of Singapore’s population, and while many are working in construction and household jobs that educated Singaporeans do not want to do, there’s a growing sense that they’re also taking jobs they do want.

The government — perhaps with one eye on the similarly glittering, commercial island of Hong Kong, where calls for greater democratic representation resulted in protests last year — has seemed more willing to create some space for civil society.

Gillian Koh, a senior research fellow at the Institute of Policy Studies of the National University of Singapore, notes ground-up activism has resulted in tangible changes in recent years like the reform of the death penalty regime, the strengthening of harassment laws, and a major recalibration in social support policies.

The government’s responsiveness to concerns raised by civil society and citizen’s activism may influence the force of opposition politics, she said.

“The government’s efforts to engage civil society have resulted in policy changes and a more participatory governance equation. Even if there is political diversity, this could temper what traction opposition politicians might have,” Koh said.

But the departure of Lee could also have implications for the United States. Although Singapore is not a treaty ally,Washington has for decades relied on Lee to interpret events in Asia for it.

“Every president since Nixon has valued his counsel as a person who has been the world’s premier China watcher,” said Graham Allison, a professor at Harvard’s Kennedy School of Government and the co-author of a book on Lee, who he calls “the grand master”.

“He’s a person who can understand China and its leadership and its choices from the inside,” Allison said.

“There’s no person who could play this role, helping Chinese leaders really understand something about the U.S. and helping American leaders really understand something about China.”

But some analysts note that the Obama administration has lessened Washington’s reliance on Singapore.

While Lee used to visit the White House almost every year, his son has only been once during President Obama’s tenure.

This is partly due to better relationships with other Asian countries – and better intelligence about China.

But Allison said it would be foolish forWashington to distance itself from Singapore as the “Thucydidean challenge” of competing with a rising China becomes greater.

“I would say that we need someone like Lee Kuan Yew more than ever because, coming from a small, very successful city state, he can look to either a Chinese or an American like an independent, wise counsel.”