Saturday, December 28, 2013

Crab mentality . . . is anarchy

We window-dress it with words like comprehensive, holistic, inclusive and the like yet the outcome for PHL has been anarchy? Google: “anarchy – a state of disorder due to the absence of authority; lawlessness, nihilism, chaos, tumult, turmoil; the absence of government and absolute freedom of the individual . . .” Thus beyond the good intentions of our “kuro-kuro” we have unwittingly brought the nation to a grinding halt? The evidence: the restrictive economic provisions of the Constitution (and thus PHL is the least attractive to FDIs, and technology); neglect of basic infrastructure (from energy onwards); bypassing industrialization; and the inability to support the JFC’s seven industry winners, among others? Question: how can we be other than a poor nation under those conditions? Pope Francis must have asked a similar question:  how can we be true to our faith when we take faith and mercy for granted and are doctrinaire; and thus he “has expressed an intention to reorganize and overhaul the Roman Curia, the bureaucracy that governs the church.” [Pope replaces conservative US cardinal on influential Vatican committee, the New York Times, 16th Dec 2013]

And given our cacique, hierarchical system and structure; and because of the state of lawlessness in our midst, those at the top lord it over Juan de la Cruz – i.e., PHL is a culture of impunity, indeed! News items: Cartelized power; SMC seeks power monopoly in Bicol; Power cost surge to hamper PH economy; House to revisit EPIRA; and 20 lawmakers, 4 govs told to vacate posts . . . 

Why are we poor? Because we have yet to grow up and own up? As my Eastern European friends have learned, freedom and democracy presupposes maturity, hard work – and then some. And just like them, we could use the following prescriptions – instead of dismissing outside views outright and looking elsewhere to lay blame on for our shortcomings?

From: Report| McKinsey Global Institute; A new dawn: Reigniting growth in Central and Eastern Europe; December 2013: “From the early 1990s until the onset of the global financial crisis, in 2008, the economies of Central and Eastern Europe established a record of growth and economic progress that few regions have matched. Emerging from decades of socialism, [these countries] became standout performers in the global economy. Their inherent strengths were unleashed as state-owned industries were privatized and labor reforms implemented, attracting a flood of capital and foreign direct investment that drove productivity improvements and per capita GDP growth.”

“Yet these economies—like the United States and Western Europe—have struggled to regain momentum since the end of the recession. Despite their underlying intact strengths, such as highly educated yet inexpensive labor forces, they need to modify their economic models to restore the . . . annual growth rates of the pre-crisis years. The region must emphasize investment-led growth, expand high-value-added exports, and increase both foreign direct investment and domestic savings. For this strategy to succeed, the nations of Central and Eastern Europe will also need to build the foundation for growth, including infrastructure improvements, accelerated urbanization, regulatory reforms, institution building, investments in labor-force skills, and efforts to encourage R&D and innovation. In addition, these economies must address the aging of the workforce by raising the labor-participation rate of women and younger workers.”

“The new growth model: The global recession exposed certain weaknesses in the growth strategy that had propelled Central and Eastern European economies before the crisis. These weaknesses included very high consumption (on average, about 80 percent of GDP from 2005 to 2008) enabled by unsustainable levels of borrowing. Easy lending standards helped create real-estate bubbles . . . ; prices . . . rose by three and a half times from 2000 to 2007. Moreover, since at least 1995, overall savings in these economies failed to cover investment: national savings rates averaged 19 percent of GDP, while investment generally hovered at around 24 percent. The region depended on foreign direct investment, which collapsed during the crisis and has only partly recovered. In addition, trade was overly concentrated on Western Europe and a handful of categories, such as autos. And despite strong flows of foreign direct investment, outlays on machinery and technology were modest in many sectors.”

“A new growth model would expand exports of higher-value-added goods and services, increase productivity in lagging domestic sectors, and finance growth with renewed foreign direct investment and higher savings . . .”

That is what “the end in view” ought to be for this region of the world. But in PHL we have yet to learn – and practice – to move beyond linear thinking? In the meantime, we have descended into anarchy because we sincerely believed crab mentality is Christian-like – i.e., comprehensive, holistic, inclusive? Wrote a New York Times columnist: “[Pope Francis] had lifted the church ‘above the doctrinal police work so important to his predecessors.’ Well, they didn't get the memo in the suburbs of Philadelphia,” read: the Philippines? [Frank Bruni, The New York Times, 14th Dec 2013] “Don't let the perfect be the enemy of the good,” says Pope Francis.

What about AEC? Where are we? Where do we want to be? How will we get there?

“There we go again” comes to mind after reading a columnist that threw in the glass-is-half-full argument? Didn't we say that with OFW remittances – as we bypassed industrialization? This blog was inspired by my Eastern European friends that have lived through the EU economic integration. And the above McKinsey Report says a mouthful, but nothing about the glass is half full. “Attracting a flood of capital and foreign direct investment” was the first benefit of the EU to these countries because they opened their economies! And where is PHL in attracting FDIs? We remain the least attractive to FDIs and we know the reasons why yet we've kept our head stuck in the sand! But The Lord will provide? We've been taking the name of The Maker in vain since Padre Damaso? That is where we are? We have a handful of companies that are geared to be regionally competitive but Singapore, Malaysia and Thailand control regional trade to the extent of 70%! While we haven't even demonstrated the resolve to support the JFC's seven industry winners, for example! That is where we are? These Eastern European countries have fast-tracked infrastructure development and we have not! That is where we are? 

Where are we, again? If we can't look in the mirror, how can we establish where we are? And how can we figure where we want to be given the chaos and the lawlessness around us? Ergo: we are clueless how to get to where we want to be because we haven't even defined it in the first place?

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