Sunday, September 17, 2017

70 years of underdevelopment … history

That is over two generations of “que sera, sera” and translates to a vote of confidence for the status quo. Sadly, it comes instinctively to us and why cultures pass from one generation to the next.

Even sadder, because we’re way behind the times, the challenge of innovation and competitiveness remains at the intellectual level. And has yet to come down to the heart and the gut. And why a growth mindset eludes us. Growth is about living in the real world like tots learning to crawl and then walk. And in the process tripping and falling a few times. And how unreal is it to grow up sheltered?

While a culture can be akin to a vicious circle that gives us no break – it just goes on … and on and on … It does not open itself to be challenged like an ideology. And ideologues don’t truly problem-solve. Recall the scribes and the Pharisees. And why the blog references Padre Damaso time and again.

We’re in the 21st century where innovation doesn’t reside in hierarchy nor is it confined to an expertise. And why the blog brings up Design Thinking (developed at Stanford University) which is an iteration of brainstorming – where different disciplines are pulled together to tackle problems big and small, at the micro and macro levels.

From a more pragmatic standpoint, winning is about survival. [Dr. Walter B. Cannon, Harvard University, 1915.] Think back to tribal times … And winning is a habit; conversely, without transformation, losing is a habit as well. [Charles Duhigg, Pulitzer-prize winning author.] And tribes like winning teams can beat the odds. [the Roseto phenomenon; Roseto borough, Pennsylvania.] 

How can we be enlightened? Faith, with due respect to the Church, didn’t do it. Beyond being the regional laggard and poverty-stricken, ours is a culture of impunity.

Should we be surprised that the Dalai Lama goes beyond religion and into science? Because religion cannot be a barrier in the search for truth, as he would claim.

Science presupposes knowledge which comes from education. But we lag in university rankings … And what are we doing about it if what plays out in the media represents who and what we are? The status quo is our mirror image. 

If his Holiness the Dalai Lama is out to seek the truth, how does Juan de la Cruz recognize and acknowledge its import? What if we hear from a Franciscan priest, Richard Rohr, who comes out with his daily meditation like this one on 12th Sep 2017? “Prophets, by their very nature, cannot be at the center of any social structure. Rather, they are ‘on the edge of the inside.’ They cannot be fully insiders, but they cannot throw rocks from outside either.

“They must be educated inside the system, knowing and living the rules, before they can critique what is non-essential … Jesus did this masterfully (Matthew 5:17-48). This is what Martin Luther King, Jr. taught the United States, what Gandhi taught British-occupied India, and what Nelson Mandela taught South Africa.

“Only with great respect for and understanding of the rules can a prophet know how to properly break those very same rules—for the sake of a greater purpose and value. A prophet critiques a system by quoting its own documents, constitutions, heroes, and Scriptures against its present practice. This is their secret: systems are best unlocked from inside.

“After Christianity became the established religion of the Western Empire in the fourth century, the priestly mentality pretty much took over in both East and West, and prophets almost disappeared. When the Church held so much power, prophets were too threatening to the status quo. The clergy were at the top of the hierarchy in the full company of their patrons—kings and princes—and even began to dress like them. Emperors convened and presided over the first seven Councils of the Church. What does this tell us?

“St. Francis of Assisi saw this problem in the thirteenth century and called people to live on the edge—of the Church, of economy, of patriarchy, of the ‘system’—through universal solidarity and chosen simplicity. Pope Francis is evoking the same Gospel spirit … What a surprise that the ultimate establishment figure took the name of such a radical saint. It shocked the world because we do not expect prophecy from popes.”

On the other hand, why do we have to wait for 3 young people to die before we wake up to the folly of EJK? The death of thousands is acceptable? It is naked impunity! But then again, leader-dependency and hierarchy and subservience ... all are elements of our proud culture.

And so … we accepted the war on drugs as the key to development – and the war on poverty.

But then again, because of our parochial and insular bias, we take the rest of the world for granted. From the economic miracles of the Asian Tigers … to the UN Millennial Development Goals – and its latest version, the Sustainable Development Goals. Translation: The world owes us nothing and will not wait for us to get our act together.

And do we see a ray of hope?

“While President Duterte has expressed support for removing [the] economic restrictions in the Constitution, Constitutional change may take a long time. Fortunately, there is another initiative, supported by the administration, which included it in their priority legislative agenda, and that is to amend the Public Service Act and to let Congress define what the term ‘public utilities’ is under the Constitution that is subject to the 40% ownership limit to foreigners.

“If this bill also passes the Senate and becomes law, it will be the most significant and consequential economic legislation ever in the history of the Republic. It clarifies the distinction between ‘public services’ and ‘public utilities,’ which terms are often confused and makes ‘public utilities’ only a subset of ‘public services.’ It states that only the following industries may be deemed ‘public utilities’: electrical distribution, electrical transmission, water pipeline and sewerage distribution. For an industry to be classified a ‘public utility,’ it must pass a criteria, which includes being a natural monopoly, distribution to the public of a commodity or service through a network, the commodity or service must be necessary for the life and occupation of residents, and the commodity or service must be provided to the public on demand.

“A consequence of this amendment would be to remove telecommunications and transport from the list of “public utilities,” and therefore no longer subject to the Constitutional provision restricting ownership and operation to companies or entities with a majority Philippine ownership.

“The economic benefit will be huge. It will improve competition in ownership and operation of strategic industries; facilitate technology transfer; increase efficiency, reduce costs, and improve service of telecom and transport companies. Also, it will greatly improve the foreign investment climate. This would lead to increased foreign investments that will generate jobs, promote innovation, and more importantly, finance the growing current account deficit.

“It will also promote good corporate governance since the restrictions would no longer result in ‘adverse selection,’ wherein only those foreign investors willing to skirt the law, will come. (It’s an open secret that the telco duopoly are effectively owned and controlled by foreign companies using legal legerdemain.) Furthermore, those foreign companies that were scared to tie up with local companies because of their host countries’ strict foreign anti-corrupt practices laws, will finally come.” [Dismantling the Post-EDSA order, Calixto V. Chikiamco, Introspective, BusinessWorld, 11th Sep 2017]

While the writer keeps his fingers crossed [and why he is committed to maintain the blog] that the foregoing initiative will come to life, he has lived long enough to recognize how we bungle things. 

For example, we can’t seem to connect the rule of law amongst the dots in the journey from poverty to prosperity. Absent foresight, creativity has no prayer. And consequently, innovation and competitiveness – and winning – too.

Consider the milestone-decisions we made over decades just to name a few: import-substitution; the sugar industry; the coconut industry; the garment industry; OFWs deployment; the BPO industry; the once white elephant we call NAIA 3; etc.; etc. [And there is no doubt you can make your own list. For example, kicking out the occupants of Clark and Subic yet the US military remains despite our posturing toward China and Russia.]

What is their common denominator? Beyond national defense, the absence of foresight both in infrastructure development and industry. And with industry there are two parts to it: (a) rent-seeking by oligarchy; and (b) the inability to move up the value chain for the rest of industry. [See above re learning to crawl and then walk.]

And when we superimpose tyranny, we are not only shooting ourselves in the foot. Are we digging our own grave? Ask the folks of the three-young people that had to die that finally woke us up?

“Why independence, if the slaves of today will be the tyrants of tomorrow? And that they will be such is not to be doubted, for he who submits to tyranny loves it.” [We are ruled by Rizal’s ‘tyrants of tomorrow,’ Editorial, The Manila Times, 29th Dec 2015]

“As a major component for the education and reorientation of our people, mainstream media – their reporters, writers, photographers, columnists and editors – have an obligation to this country . . .” [Era of documented irrelevance: Mainstream media, critics and protesters, Homobono A. Adaza, The Manila Times, 25th Nov 2015]

“National prosperity is created, not inherited. It does not grow out of a country’s natural endowments, its labor pool, its interest rates, or its currency’s value, as classical economics insists . . . A nation’s competitiveness depends on the capacity of its industry to innovate and upgrade.” [The Competitive Advantage of Nations, Michael E. Porter, Harvard Business Review, March–April 1990]

“Learning and innovation go hand in hand. The arrogance of success is to think that what you did yesterday will be sufficient for tomorrow.” [William Pollard, 1911-1989, physicist-priest, Manhattan Project]

“Development [is informed by a people’s] worldview, cognitive capacity, values, moral development, self-identity, spirituality, and leadership . . .” [Frederic Laloux, Reinventing organizations, Nelson Parker, 2014]

Sunday, September 3, 2017

Leadership, not analysis-paralysis

Can we paddle our own canoe? There is no free lunch, in case we have forgotten. But is our “kuro-kuro” culture akin to Washington DC punditry? And why one that many assumed had leadership – that he could create jobs being a businessperson – was elected president?

Leadership as the blog has argued was demonstrated by the likes of Lee, Mahathir and Deng. Did it matter whatever was happening elsewhere in the world? Not even ideology, in the case of Deng.

Recall that “The four Asian tigers have consistently maintained high levels of economic growth since the 1960s, fueled by exports and rapid industrialization, which enabled these economies to join the ranks of the world's richest nations.

“Hong Kong and Singapore are among the biggest financial centers worldwide, while South Korea and Taiwan are important hubs of global manufacturing in automobile and electronic components as well as information technology, respectively.” [Investopedia]

We can’t rationalize our underdevelopment – like a truant student. We must instead take the bull by the horn and press forward. We must challenge our mindset – aka “Pinoy abilidad” – and learn from others. The harsh reality we must accept is that we don’t have a track record in development.

For example, while the Neda’s Ambisyon Natin 2040 speaks to “where we want to be,” it does not stress “where we are”! We must first recognize and acknowledge our reality otherwise we fall into the trap of analysis-paralysis. It is not the first time the blog has raised Kurt Lewin’s ‘Force-field analysis.’ “Force-field analysis is an influential development in social science. It provides a framework for looking at the factors (forces) that influence a situation, originally social situations.

“It looks at forces that are either driving movement toward a goal (helping forces) or blocking movement toward a goal (hindering forces). The principle, developed by Kurt Lewin, is a significant contribution to the fields of social sciencepsychologysocial psychologycommunity psychologyorganizational developmentprocess management, and change management … He used theory, mathematics, and common sense to define a force field, and hence to determine the causes of human and group behavior.” [Wikipedia]

A case in point: We can’t keep beating the Constitution black and blue if we don’t address the power of oligarchy to keep us away from any effort to amend it. Likewise, our inability to learn from the Asian Tigers speaks volumes, that of our parochial and insular instincts.

Consider: “The UN Millennium Development Goals (MDGs) sought to reduce poverty among UN member-states between 1990 and 2015. There were 10 MDGs. The most significant MDGs were the ‘halving’ of poverty and inequality levels by 2015.

“The Philippines failed to achieve both. The National Economic and Development Authority (Neda) admitted, in the Fifth MDG Progress Report (2014), that inequality barely changed—from 0.48 Gini coefficient in 1991 to 0.47 in 2012.  In fact, some commentators even assert that inequality has worsened, with some 40 richest Filipino families lording over a nation of over 100 million.

“Now the MDGs have been replaced by the Sustainable Development Goals (SDGs), as approved by the UN General Assembly in 2015. This time, the SDGs are more ambitious, with zero hunger and zero poverty targets by 2030. The SDGs are collectively called the ‘2030 Agenda for Sustainable Development.’

“However, one of the goals can also be an instrument for the realization of the other SDGs.  This is SDG 9, which commits nations to ‘build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation.’

“According to Dr. Manuel Montes of the South Centre in Geneva, SDG 9 re-introduces industrialization as a goal in the UN development agenda (see Montes, “Industrialization, inequality and sustainability”, Policy Brief 44 of South Centre, August 2017).

“This requires pro-active industry policies and a revival of ‘state leadership over key economic actions’ … So, what kind of industrial policy is needed? First, industrial policy must create the economic space and means for new economic activities and livelihoods to grow. For example, it is not enough for a developing country to link its national growth to the export market by participating in the global value chains (GVCs) of the multinationals of developed countries … Developing countries, while participating in the GVCs and the global export market, must find ways to develop national technology, upgrade skills and diversify their economy.

“Second, industrial policy must nurture domestic innovation and productivity across all sectors—industry, agriculture and services. This includes growing new ‘industries’ in these sectors and looking for ways to grow these industries ... Third, industrial policy must address development questions related to the choice of appropriate technology and the efficient scale of production.

“Fourth, industrial policy must enable the rise of a strong domestic enterprise sector that can compete with foreign investors in a level playing field and supply the requirements of a growing domestic market … Fifth, industrial policy must promote policy coherence and coordination among different agencies.

“As amply articulated by Montes in the case of SDG 9, the SDGs can be a weapon for growth and sustainability. The point is how to fulfill the SDGs through a more pro-active and forward-looking national development program.” [SDG 9 commits PHL to ‘inclusive, sustainable industrialization,’ Rene E. Ofreneo, BusinessMirror, 30th Aug 2017]

It is worth repeating: “However, one of the goals can also be an instrument for the realization of the other SDGs. This is SDG 9, which commits nations to ‘build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation.’”

In other words, infrastructure development, industrialization and innovation … will pave the way for the realization of the other goals. And they are all within our control except that we have yet to step up to the plate – while constantly engaged in analysis-paralysis?

It takes foresight to confidently map out and pursue infrastructure development. And the Metro Manila traffic we are screaming and kicking about mirrors our shortsightedness. Which also explains our inability to industrialize. Absent both these elements there is no way [Jose!] we could be in the game …  innovation- and competitiveness-wise.

Yet, we aren’t keen to learn from others? For example, the blog has discussed “From Poverty to Prosperity: Understanding Economic Development,” a program offered at Oxford University … Learn about the role of government and the key political, social, and economic processes that elevate any society from poverty to prosperity. [In case we miss that, it says “any society” – irrespective of what we seem to believe is our destiny.]

“The Program discusses and examines the following topics: The role of government and the key political, social and economic processes that affect development; Why societies need polities that are both centralized and inclusive, and the process by which these polities develop; The social factors that are necessary for development, including the importance of identities, norms, and narratives;

“The impact of economic processes on development, including discussion about how government policies can either promote or inhibit the exploitation of scale and specialization; The external conditions for development, including trade flows, capital flows, labor flows and international rules for governance.”

This body of knowledge acknowledges that even anarchy is not a barrier to development and that nations can progress from anarchy to a centralized state and on to inclusive states. The premise: “economic development needs alignment between power and identities.”

And that growth is achieved through urbanization and industrialization, i.e., economic development depends upon exploiting scale and specialization.

Sadly, “Pinoy abilidad” is too smart for our own good! At the end of the day, we can’t paddle our own canoe because of our way of life? Parochial and insular; hierarchical and paternalistic; political patronage and dynasties; and oligarchic. And why we have yet to produce a leadership like Lee or Mahathir or Deng.

And for AmBisyon to have a prayer, Neda must engage Juan de la Cruz on this gut-level issue, that is, our culture. A culture is not cast in stone given this world is best characterized by impermanence – as we learned from our faith and why we believe in the afterlife.

As well as there is a body of knowledge that recognizes the superiority of a growth mindset over intelligence that is undermined by a fixed mindset. Which we demonstrate in spades but have yet to acknowledge? If we would pause, hold our breath and scan the contents of local media?

“Why independence, if the slaves of today will be the tyrants of tomorrow? And that they will be such is not to be doubted, for he who submits to tyranny loves it.” [We are ruled by Rizal’s ‘tyrants of tomorrow,’ Editorial, The Manila Times, 29th Dec 2015]

“As a major component for the education and reorientation of our people, mainstream media – their reporters, writers, photographers, columnists and editors – have an obligation to this country . . .” [Era of documented irrelevance: Mainstream media, critics and protesters, Homobono A. Adaza, The Manila Times, 25th Nov 2015]

“National prosperity is created, not inherited. It does not grow out of a country’s natural endowments, its labor pool, its interest rates, or its currency’s value, as classical economics insists . . . A nation’s competitiveness depends on the capacity of its industry to innovate and upgrade.” [The Competitive Advantage of Nations, Michael E. Porter, Harvard Business Review, March–April 1990]

“Learning and innovation go hand in hand. The arrogance of success is to think that what you did yesterday will be sufficient for tomorrow.” [William Pollard, 1911-1989, physicist-priest, Manhattan Project]

“Development [is informed by a people’s] worldview, cognitive capacity, values, moral development, self-identity, spirituality, and leadership . . .” [Frederic Laloux, Reinventing organizations, Nelson Parker, 2014]

Monday, August 28, 2017

Impunity to the nth degree

How are we as a people responding to our reality? Here’s a promising one, “[T]he menace of illegal drugs is real and destructive … Let us save the lives of people most people vulnerable to drug dependency: the youth, the poor and unemployed. Words of solidarity without tears and acts of compassion are cheap.

“But my own personal interpretation is that Cardinal Tagle’s main message is a request for unity and a national dialogue. He writes: ‘Let us invite families, national government agencies, local government units, people’s organizations, schools, faith based communities, the medical profession, the police and military, recovering addicts, etc. to come together.’ He then makes this offer: ‘The Archdiocese of Manila would be willing to host such a multi-sectoral dialogue.’” [Spare a Life, Elfren S. Cruz, BREAKTHROUGH, The Philippine Star, 24th Aug 2017]

What if we look outward, say, to South Korea? How are they dealing with impunity? “Samsung Heir Is Found Guilty of Corruption in Blockbuster Trial,” Jeyup S. Kwaak and Paul Mozur, The New York Times, 25th Aug 2017.

“Public perception in South Korea toward the country’s biggest family-controlled business empires has changed in recent years as scandals have mounted and as the economy has matured, making them less appealing in an era of entrepreneurship and start-ups. In the wake of the corruption scandal — which led to the impeachment of Ms. Park — the current president, Moon Jae-in, campaigned on holding South Korea’s corporate empires to account.

‘We hope this will be the first step in cutting the stubborn ties of corruption between politics and business, which has been a roadblock to progress in our society,’ said Yoon Young-chan, senior secretary at the Blue House, the South Korean president’s executive office and residence.”

That is not to say that the effort of Cardinal Tagle for a multi-sectoral dialogue is not to be applauded. We as a people must seize the opportunity and actively participate in undertakings meant to move PH forward – which is the object of the post and the blog’s reason for being – going 8 years … and counting.

Likewise, we must recognize and acknowledge that our culture of impunity demands of the Filipino people to transform. Otherwise our seventy-year old problem of underdevelopment – and the poverty that comes with it, and worse, being the laughingstock of the region, if not the world – shall define what and who we truly are: “mahinang klase, hindi de kalidad.”

Consider: What is the flipside of our high-growth economy? That we are the OFW-economy, and they include graduate nurses and teachers that realized to be maids and servants overseas was the best option to support the needs of their families. And why the blog has discussed the implication of our worldview, i.e., “a foolish man builds upon the sand”!

Yet we celebrate it … with a little help from Forbes, “Duterte’s infrastructure dev’t drive impacts Philippine tycoons’ fortunes,” re Krista A. M. Montealegre, BusinessWorld, 25th Aug 2017. “HENRY SY, Sr. of the SM Group has remained the country’s wealthiest man on the ForbesPhilippines’ 50 Richest List for the tenth straight year, with the economic policy of President Rodrigo R. Duterte playing part in dictating the fortunes of the country’s business magnates.

“Eighteen Filipino billionaires led by Mr. Sy made it to the elite club this year, down from 21 in 2016, as half of the country’s top 50 tycoons saw their net worths take a hit because of the flat performance of the benchmark Philippine Stock Exchange index and the weakness of the peso against the US dollar, Forbes said in a statement.”

While we may be concerned about the weakness of the peso, what about the weakness of our character? Who can we still believe? On one hand, “Paolo never asked for special favors,” Manila Standard, 25th Aug 2017; on the other, “Lacson’s son is a smuggler,” William Depasupil, The Manila Times, 25th Aug 2017.

And consider: “Peace and order situation worries foreign investors,” Roy Stephen C. CanivelPhilippine Daily Inquirer, 24th Aug 2017. But we have Build, Build, Build – though that is to brush aside its own flipside: “After the infra projects, what (?),” Raul J. PalabricaPhilippine Daily Inquirer, 14th Aug 2017. “While it is true that these projects, once completed, would create some economic activities in their peripheries, e.g., mom-and-pop stores and service outlets, these are not the types of businesses that would make the projects worth the money spent on them.

“These projects deserve something more substantive than small and medium scale enterprises or activities that are in the league of export processing zones that can generate thousands of long-term jobs.”

For example, “Arangkada forum to explore PHL industrialization,” Elijah Joseph C. Tubayan, BusinessWorld, 24th Aug 2017. “[T]he JFC said that it will take on issues like opening up foreign investment, boosting value-added merchandise exports, incentivizing agriculture growth, tourism, infrastructure, mining, as well as the expansion of the BPO industry.

“The basis for economic growth is currently narrow, according to Julian H. Payne, president of the Canadian Chamber of Commerce of the Philippines, as its drivers remain to be the BPO industry and overseas remittances ... ‘To join the ranks of all the industrialized countries, you’re going to have to diversify the economy considerably. That means really picking up agriculture, really picking up manufacturing, and diversifying it geographically,’ he said.

“Benjie Garcia, executive director of the Australia-New Zealand Chamber of Commerce Philippines, Inc. (ANZCHAM) for his part, said that the Philippine BPO sector has reached maturity, raising the need to attract new investors and retain those currently here ... ‘They added that BPO firms should also look into developing capacity in the non-voice and knowledge sector, noting increasing competition within the region.

“Mr. Payne … called for increased infrastructure and technology to accommodate small-scale family farms and help them evolve to more efficient commercial operations. ‘I don’t think we’re going to be able to make huge progress in agriculture without addressing the need for larger, more efficient farming operations with appropriate infrastructure,’ Mr. Payne said.

“The business groups also said that backward and forward integration is the ‘key to success’ in the mining industry, and urged the government to open refineries that will process extracted minerals, enabling the industry to capture more value added. ‘If you want to develop mining, you have to develop in parallel an open environment to foreign investments to manufacturing, and encourage manufacturing,’ Mr. Payne said.”

But why aren’t we truly open to foreign investments? “Senator Manny Villar says oligarchy is the reason why attempts to amend the economic provisions of the Constitution have failed – three presidents (Fidel Ramos, Joseph Estrada and Gloria Macapagal Arroyo) tried to amend the Constitution in the past 15 years, to no avail.

‘We’re still an oligarchy run by a few families,’ Villar says. ‘They’re happy with the present setup now and they will not allow the Constitution to be tampered with.’

‘The media, from what I’ve seen, is also controlled by groups that do not want to change the Constitution,’ the former Senate president adds. ‘And that is why any proposal [to amend the Constitution] will be killed right away.’” [Filipinos to remain at the mercy of oligarchs, Nick Legaspi, Third World Resurgence No. 251/252, July/August 2011, pp 3-5]

What can we learn from South Korea, again? “We hope this will be the first step in cutting the stubborn ties of corruption between politics and business, which has been a roadblock to progress in our society.”

And as the blog has argued, the impunity we live with is a consequence of our way of life: Parochial and insular; hierarchical and paternalistic; political patronage and dynasties; and oligarchic.

Can we transform Juan de la Cruz? For instance, the Dalai Lama goes beyond religion and into education. Which explains why he engages in dialogues with scientists – religion cannot be a barrier in the search of truth, as he would explain. Simply put, he is not an ideologue. Which we can also say of Francis, and why elements within the Curia can’t stand him? Yet Pope Pius XI established the Pontifical Academy of Sciences – learning a lesson after the Roman Inquisition wronged Galileo. Did Padre Damaso wrong Juan de la Cruz too?

How much science should the Philippine Church promote a la the Pontifical Academy of Sciences? Recall the Philippines – the only Christian nation in the region – “lags in Asian university rankings.”

To recap: We can build on Neda’s AmBisyon Natin 2040 and a good starting point is to answer the questions: (a) Where are we? (b) Where do we want to be? (c) How do we get there?

“Why independence, if the slaves of today will be the tyrants of tomorrow? And that they will be such is not to be doubted, for he who submits to tyranny loves it.” [We are ruled by Rizal’s ‘tyrants of tomorrow,’ Editorial, The Manila Times, 29th Dec 2015]

“As a major component for the education and reorientation of our people, mainstream media – their reporters, writers, photographers, columnists and editors – have an obligation to this country . . .” [Era of documented irrelevance: Mainstream media, critics and protesters, Homobono A. Adaza, The Manila Times, 25th Nov 2015]

“National prosperity is created, not inherited. It does not grow out of a country’s natural endowments, its labor pool, its interest rates, or its currency’s value, as classical economics insists . . . A nation’s competitiveness depends on the capacity of its industry to innovate and upgrade.” [The Competitive Advantage of Nations, Michael E. Porter, Harvard Business Review, March–April 1990]

“Learning and innovation go hand in hand. The arrogance of success is to think that what you did yesterday will be sufficient for tomorrow.” [William Pollard, 1911-1989, physicist-priest, Manhattan Project]

“Development [is informed by a people’s] worldview, cognitive capacity, values, moral development, self-identity, spirituality, and leadership . . .” [Frederic Laloux, Reinventing organizations, Nelson Parker, 2014]

Wednesday, August 23, 2017

Like a carousel, PH is running ‘round in circles …

We have a seventy-year old problem, do we need adult supervision? “All right, so maybe we should be allowed to pop some corks. But after we’re done congratulating ourselves, the question to confront is whether the episode can be sustained.

“After all … growth accelerations are not as rare as one might think … [F]or example, Thailand had two episodes of growth acceleration (1957, 1986), as did Indonesia (1967, 1987), Malaysia (1970, 1988), South Korea (1962, 1984), and China (1978, 1990).

“[China] could add a few more, and an early one could probably be booked for Vietnam as well (1989). The Philippines is an outlier in that it took almost seventy years before it experienced the current — and only — one.”

“[T]he real question is whether the current direction of ‘Dutertenomics’ protects the economy against a possible collapse or renders it more vulnerable … That’s where the picture becomes decidedly mixed — or one might say, clearly murky. Even as we mark a completed growth-acceleration episode, the ‘change that is coming’ in its wake is unsettling.

“Until recently, a current-account surplus — even in the face of rapid growth — used to distinguish us from neighbors like Vietnam, Indonesia, and even India.

“Now however the country is about to experience its first current-account deficit in 15 years and anticipates a balance of payments deficit to boot. No surprise, therefore, that the peso has depreciated to its lowest level in more than a decade, well out of line with its peers and global trends.

“But this trend has been encouraged by the administration’s own fiscal signals. (Remember the twin-deficit formula.) It has clearly announced its willingness to widen the fiscal deficit to as much as 5% of GDP.

“At the same time, it seeks to convince Congress to raise new taxes to support an ambitious infrastructure plan — which is itself bogged down in ‘absorptive capacity’ problems (Gerry Sicat) alias ‘execution problems’ (Boo Chanco) involving procurement, right of way, and inadequate planning and design skills in government.

“Let’s see, so on the one hand, the Dutertenomists have indicated their willingness to loosen the purse strings, even as they signal (no, demand) that new funds shall be forthcoming … Meanwhile, it is common knowledge that actual infrastructure spending will inevitably fall short of what is planned.

“The predictable effect is to encourage populist proposals in aid of election or patronage: free irrigation, free college tuition (et tu, Bam Aquino!), increased retirement pensions, new rice subsidies to 4P beneficiaries and to uniformed personnel and so on — not to mention fat unaudited intelligence funds to reward those incorruptible and human rights-loving police.

“To be sure, none of these events or doubts is likely to be fatal in a single year. But can or will these directions be sustained over six to eight more years? One cannot help wondering then if Dutertenomics has not started out on the wrong foot.

“What if the Dutertenomists had focused instead on improving the investment climate, particularly direct foreign investment? What if, rather than antagonizing the US, the EU, and the UN, the administration had instead simply reaffirmed its traditional economic and political partnerships, even as it vigorously encouraged trade and investment deals with new actors like China and Russia?” [Growth accelerations, Emmanuel S. de Dios, Introspective, BusinessWorld, 21st Aug 2017]

“Constitutional amendments needed to boost FDI,” Elijah Joseph C. Tubayan, BusinessWorld, 18th Aug 2017. There we go again … how long have we been talking about amending the Constitution? Do we look like a carousel that just keeps running ‘round in circles?

“THE GOVERNMENT needs to amend the constitution to open up industries currently restricted from foreign participation, to unleash the economy’s full growth potential, economists said.

“[F]ormer Socioeconomic Planning Secretary Cielito F. Habito said that efforts to open up new sectors for foreign direct investment (FDI) require comprehensive efforts to amend the charter, noting that current tweaks to redefine ‘Public utilities’ to allow more FDI will have only a temporary impact.

“The reason we continue to lag behind our neighbors, despite dramatic improvements already made, is still because of these legal constraints to more foreign participation in our industries.” [Tubayan, op. cit.]

“[W]hat if — rather than pursue the ‘war on drugs’ — they had immediately resumed and championed the Bangsamoro peace process and ratified the Bangsamoro basic law?

“Would we then have seen a stronger, more varied wave of foreign direct investments that could have covered the incipient deficits in the current account and the BoP?” [de Dios, op. cit.]

“President Duterte has had the majority of the people at his back since the beginning of his war against illegal drugs. Even while sometimes expressing great apprehension at the methods used and, more specifically, the conduct of the police, strong support has been reasonably consistent during the past year.

“The shooting to death by the police of Kian Loyd Delos Santos may be the turning point in the people’s trust of Duterte and his policies.

“MalacaƱang better realize very quickly that a failure of trust about the war on drugs will negatively affect the public’s view about all of the president’s initiatives, from foreign policy to local transportation. A lack of trust in a person is not confined to the immediate matter at hand. If a company cannot trust an executive about a small expense account item, can it trust that same person not to reveal trade secrets?

“Presidential Spokesman Ernesto C. Abella, describing the killing as an ‘isolated’ incident, is, perhaps, the weakest possible answer to this potential crisis of trust and confidence. The next few days and weeks, as the investigation into the killing continues, may well determine what the next five years of the relationship between the President and the people will be and whether his presidency will be a success.

“The President and his advisors are at a crossroads. Any indication of a lack of transparency in the investigation or attempts to diminish the seriousness of this potential crime will be met with increasing outrage. Someone once said, ‘Trust is like a vase. Once it is broken, though you can fix it, the vase will never be the same again’.” [Losing trust, BusinessMirror, Editorial, 21st Aug 2017]

Don’t we take pride in our being the only Christian nation in the region – the solitary country without divorce, and takes reproductive health as evil? How could we for a moment imagine that EJK exemplifies our values?

Didn’t we say “power corrupts and absolute power corrupts absolutely” … in the case of Marcos? Yet we are poised to add insult to injury, setting the stage for Bongbong Marcos to assume the throne? Who cares if this family fits the PH culture of impunity to a tee?

Like a carousel, PH is running ‘round in circles … We have a seventy-year old problem, we do need adult supervision? Could we learn from the Joint Chiefs despite the US president being the commander-in-chief? Not if we can’t toss our leader-dependency and subservience, a consequence of our hierarchical and paternalistic instincts?

“They were speaking directly to the force and to the American people: to the force to make clear that that kind of racism and bigotry is not going to stand inside the force. And to the American people, to remind them of the values for which we stand in the U.S. military, which are reflective of the values of the United States.

[In other words, the Joint Chiefs are providing the 71-year old boy occupant of the White House adult supervision.]

It's rare for active high-ranking members of the military to engage in political statements, and especially to publicly appear to distance themselves from the president.” [Joint Chiefs Denounce Racism After Trump's Comments, James Doubek, npr.com, 17th Aug 2017] 

If such is a rarity even in America, recall that in a previous post the blog spoke to transformation. And the Dalai Lama comes to mind. Can we instead learn to turn away from our self-regard and wipe the tears from the eyes of another – as in community and the common good? Our inward-looking bias makes it counter-intuitive, but it’s the true secret to joy per His Holiness and Archbishop Tutu. [The Book of Joy, with Douglas Abrams; Penguin Random House]

“Why independence, if the slaves of today will be the tyrants of tomorrow? And that they will be such is not to be doubted, for he who submits to tyranny loves it.” [We are ruled by Rizal’s ‘tyrants of tomorrow,’ Editorial, The Manila Times, 29th Dec 2015]

“As a major component for the education and reorientation of our people, mainstream media – their reporters, writers, photographers, columnists and editors – have an obligation to this country . . .” [Era of documented irrelevance: Mainstream media, critics and protesters, Homobono A. Adaza, The Manila Times, 25th Nov 2015]

“National prosperity is created, not inherited. It does not grow out of a country’s natural endowments, its labor pool, its interest rates, or its currency’s value, as classical economics insists . . . A nation’s competitiveness depends on the capacity of its industry to innovate and upgrade.” [The Competitive Advantage of Nations, Michael E. Porter, Harvard Business Review, March–April 1990]

“Learning and innovation go hand in hand. The arrogance of success is to think that what you did yesterday will be sufficient for tomorrow.” [William Pollard, 1911-1989, physicist-priest, Manhattan Project]

“Development [is informed by a people’s] worldview, cognitive capacity, values, moral development, self-identity, spirituality, and leadership . . .” [Frederic Laloux, Reinventing organizations, Nelson Parker, 2014]