Tuesday, December 22, 2015

“Arrogance of success”

“. . . [L]ike what he did in Makati City . . .” [Binay unfazed by Duterte lead in survey, vows to reduce poverty in PH, Maya Jajalla, Inquirer Visayas, 7th Dec 2015] “He vowed that his administration would prioritize poverty alleviation and uplifting the lives of Filipinos, particularly in Negros Oriental, considered the poorest province in Central Visayas. He also promised to continue the cash dole out program of the government for poor families — the Pantawid Pamilyang Pilipino Program (4Ps) — and improve it to ensure better and efficient services as well as provide financial assistance to the senior citizens like what he did in Makati City.”

Of course we can afford dole outs. Beyond Binay and Makati, consider: “12 Filipinos in Forbes’ 2015 billionaires’ list,” Rappler.com, 4th Mar 2015.

But can we do better than dole outs? “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; colleague of Einstein in Manhattan Project]

Not surprisingly, we rank poorly in the Global Innovation Index, behind Singapore, Hong Kong, China, Malaysia, Vietnam, Thailand and India. We may be ahead of Indonesia but how could we lag Moldova, for instance? Those of us ensconced in gated communities won’t even imagine living in Moldova – a nation of less than 5 million people with a GDP (PPP) per capita of $5,000, even lower than our $7,000.

Granted we’re moving up in the various global rankings, let’s distinguish the low-hanging fruit from honest-to-goodness transformation. In other words, so long as we take as sacrosanct elements of our way of life we shall always be blindsided – that will reflect and reinforce the absence of community and the common good in Juan de la Cruz? And proud as we are, our 12 entrants to the Forbes’ list cannot enlarge the PH pie. That is why a critical measure of development is not the 1-% but the size of the middle class.

And it’s not about focusing on populist measures either. Fundamental in economics is the scarcity of resources. And the response is not “crab mentality” but priority setting. The evidence? Beyond poverty we can’t fix such basic problems as electricity, the jeepney and, of course, traffic. Priority setting comes not from an inward- and backward-looking bias but an outward- and forward-looking mindset. And from where visionary and strategic leadership is derived. To keep postponing the inevitable means spiraling down the abyss – a race to the bottom!

“[I]n the city of Sirjan, decisions long postponed have begun to impose themselves on local officials, forcing them to make difficult choices in allocating scarce water supplies.” [Scarred Riverbeds and Dead Pistachio Trees in a Parched Iran, Thomas Erdbrink, The New York Times, 18th Dec 2015]

“Wedged between two newly built neighborhoods of five-story apartment buildings, a convoy of water trucks waited in line to fill their 5,000-gallon tanks. Under a deal with the local water management company, up to 400 of these trucks a day draw water from the city’s main well and head to the Golgohar iron mine, the largest such mine in the Middle East. It employs over 7,000 people, many of them from Sirjan, and a water shortage has compounded an already difficult situation brought on by collapsing iron ore prices.

“It is internationally unprecedented to carry water with tankers, but we have no other way . . . If water is not taken to the complex, projects are stopped, and many people will lose their jobs.

“Kerman Province remains one of the largest producers of pistachios in the world, but its irrigation methods are frequently outdated. In one field, a farmer, Ismael Alizadeh, opened an eight-inch water pipe during the middle of the day, under the burning sun, flooding a field of pistachio trees. ‘We have always done it like this,’ he said with a shrug.

“He blamed the government for keeping energy and water prices low . . . covering his huge pump and 20 employees. ‘It’s ridiculous,’ he said. ‘And while we have no water, its price is also dirt cheap.’”

It’s delusional? Which is also what we suffer in PH?

The fact that Bongbong Marcos has the gall to talk down on Marcos critics speaks volumes, and brings to mind Peter the Great who was supposedly a reformist. But having lived through martial rule we know firsthand that power corrupts – and absolute power corrupts absolutely. Does it explain the chutzpah?

Yet, is it only Bongbong or Binay who is delusional? Power resides as well in the elite class and where we are today as a nation speaks volumes. We have been corrupted as well!

And the writer can commiserate with the NEDA secretary who sees the economy growing at 6% despite a slower 3rd quarter. Because even at 7% growth it would take us a generation to move up to developed-nation status, confirmed by the international institutions.

Comes our next delusion. That because we are the fastest growing country in the region we should be thankful and in celebration mode. But that’s of no moment because our average income can’t mask our being a Third-World country; and with it comes the levels of poverty we talk about incessantly.

Indeed we have a structural deficiency – effectively a cancer – and yet we like to look at the symptoms like our 6% or 7% growth rate? OFW remittances and the BPO industry by themselves can’t build up this economy. Nor the series of credit rating upgrades, with due respect to the CB. The financial community does not necessarily examine the building blocks of an economy. The evidence? Look at how they brought the world down to its knees, the Great Recession!

The fact that we are nowhere near an industrialized economy says we can’t be an economic powerhouse. Singapore is tiny population-wise, among others, and can easily be a service-economy powerhouse like Switzerland. But 100 million Filipinos need more than a service economy. And we like to talk up demographic as our “sweet spot” – that a big and young population equals a dream economy and attractive to investors? Another delusion? China and India had bigger population and the world was witness to their poverty until they pursued economic reforms – and attracted FDIs. Yet we like to believe FDIs come like manna from heaven? 

We need enormous investments that must be funneled to critical industries that will raise PH competitiveness. And that means setting priorities like the 7 industry winners teed up by the JFC because they will attract FDIs, generate employment in a major way and appreciably raise economic output, including exports. Except that it goes against the grain especially when our favorite industry is not among the winners. And when political patronage and oligarchy are behind the “crab mentality,” we can only kiss FDIs and PH industrialization and competitiveness goodbye? And which has been the case for the longest time!

And even more fundamental, to attract investment, we must accelerate infrastructure development. And that means we can’t take the focus away from Metro Manila while we do what must be done in the other major metro and even rural areas. And our dreadful traffic is only a symptom. It is again about Pareto. We have to accelerate infrastructure development in Metro Manila given it is the engine of the economy.

Americans can focus on Iowa to demonstrate a culture of inclusion it being campaign season but that doesn’t mean Cuomo can ignore the infrastructure challenges of New York – or those of California c/o Brown. Or could they stop prosecuting errant politicians – like those in Albany.

On the other hand ‘Pinoy abilidad’ is telling us to prioritize the low-hanging fruit like making business registration more efficient or lowering taxes to encourage consumption or focusing on MSMEs. There is nothing wrong with all of them. Except that they are focused on “the activity” as opposed to “the outcome.” Sadly, they are a reflection of the absence of visionary and strategic leadership?

But then again, visionaries are few and far between. Even Steve Wozniak could not figure out his friend Steve Jobs that they had a falling out. Wozniak was focused on “the activity” of creating a computer but Jobs’ vision was to change the world. And indeed that was way beyond human comprehension.

To Wozniak Jobs was perhaps delusional?

And if an Iranian farmer acknowledges their own delusion, what about us? We may be successful as individuals but have we set this nation down a slippery slope? And that is more than shameful?

Being a churchgoing people, what role should we wish the Philippine church play so that we – especially the elite class – begin to dig deep and figure out what Rizal and peers saw over a century ago? And there is Francis if we need guidance? Our shortcomings aren’t new as historians would point out – and we have a bigger challenge than we’ve recognized?

In the meantime, “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]

“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]

[My family joins me in wishing one and all a blessed Christmas and a healthy and prosperous New Year!]

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