Thursday, April 28, 2016

Sheer insanity

If we believe President Aquino was a mediocre manager, what about Juan de la Cruz, were we any better – as citizens? And with the coming change in administration, together with those that were ones the navigators if not the captains of the ship we call PHL, we are all coming out with our two cents on how to right the ship? But what paradigm is guiding us? If it is same old same old, what should we expect? Insanity?

Thankfully, it is now accepted that the two major income streams – OFW remittances and the BPO industry – we were so proud of don’t make for a competitive PHL. But what lesson must we learn? They were classic “pwede na ‘yan”? They had a common denominator which equated to a comparative advantage for PH, English-speaking young Filipinos.

Yet we know from economic development that while the starting point may be agriculture, wealth generation – which we call GDP – demands higher value-added products and services. And that means evolving into industry. It does not mean totally abandoning agriculture but complementing it. [And this blog gave the example of cacao farming being complemented by branded chocolates like premium Belgian chocolates or closer to home, Nescafe in coffee farming.]

And in the 21st century comparative advantage has evolved into competitive advantage. And it is simply the ability to move up the value chain – which is not a static but a dynamic state. Because the human need is a continuum. It is not about consumerism – which is a cop out when our innovation quotient is suspect.

Man is made in the image and likeness of his Creator – who is both human and divine. In other words, “pwede na ‘yan” is not God-like. For man to expect progress and development is not evil but evolution, i.e., a human right.

And which as Francis declared is not incompatible with creation. “[S]pecies survived through a process called ‘natural selection,’ where species that successfully adapted to meet the changing requirements of their natural habitat thrived, while those that failed to evolve and reproduce died off.” [Charles Darwin, Biography,] It is the Pinoy backwardness that is off base?

Competitive advantage presupposes continuing investment, technology, innovation as well as people development, product development and market development. But then again, as we now know, industrialization demands a platform, that is, infrastructure development.

How can there be sustainable much less competitive industry when power is dubious to begin with? Should we pause and ask ourselves why we allowed Juan de la Cruz to be a victim of such shortsightedness – yet our elite class are talking up business as usual? Because they’re making a killing behind our infrastructure backwardness? It’s sheer insanity! Not surprisingly, once upon a time, the lone voice in the wilderness (Rizal) had to be hanged?

How do we pull the above elements together? That is where leadership comes in. Visionary and strategic leadership. We need a president who can craft and articulate a vision and, as important, to harness the people behind the common good. A visionary leader by definition will have a sense of the kind of team he or she wants to put together. And will not be driven by KKK.

For example, it is not about intelligence or rank per se especially given our culture of impunity – personified by vested interests on the one hand and crab mentality on the other. And how PPP is held hostage? And because of our split-level Christianity (remember Fr. Bulatao?) the sense of community and the common good must be a mandatory – from the vision to strategy to execution.

Thus Juan de la Cruz, in our desire to offer our two cents, must be very conscious of the new paradigm that must define the leadership team of the nation. And more to the point, they cannot be (a) representing vested interests and (b) pandering to populist demands. But do we even have a prayer when these two dimensions of our reality feed on each other – it's spelled paternalism?

“The Christian is not merely ‘alone with the Alone’ in the Neoplatonic sense, but he is One with all his ‘brothers [and sisters] in Christ.’ His inner self is, in fact, inseparable from Christ and hence it is in a mysterious and unique way inseparable from all the other ‘I's’ who live in Christ, so that they all form one ‘Mystical Person,’ which is ‘Christ.’

“There is no other form for the Christian life except a common one. Until and unless Christ is experienced as a living relationship between people, the Gospel remains largely an abstraction.” [Richard Rohr's Daily Meditation, Center for Action and Contemplation, 17th Apr 2016]

What must we learn about community and the common goal – which in nation building is reflected in PH economic development?

For example, Marcos versus Park. From Daron Acemoglu and James Robinson; When nations fail, The Blog, 2nd Jan 2013. “As we noted in our last post, there is a far more charitable account of the Marcos dictatorship after 1972 in the Philippines than brought to mind by Imelda’s 3,000 pairs of shoes. 

“Marcos himself argued that the move to autocracy was needed to discipline the oligarchs and discipline them he did.

“The Lopez family was one of these. Before martial law Marcos had Fernando Lopez as his vice president as part of a strategy to co-opt the oligarchs. But after 1972 Marcos discarded him and expropriated his assets, sugar estates, media empire and power generating plants. He cowed the rest of the sugar oligarchs into submission. He also centralized the state and embarked on an attempt to promote industrial exports.

“In these strategies and aspirations Marcos was quite similar to Park Chung-Hee in South Korea. Park rose to power in a coup in 1961 and one of his first acts was to arrest and lock up business oligarchs on the grounds that they were ‘illicit profiteers’. Park similarly abandoned the attempt to keep himself in power through elections in 1972, just as Marcos did. He also famously launched an ambitious export-driven industrialization plan.

“The difference between the Marcos and the Park experiences, however, is that while the latter was a huge economic success, the first collapsed into an orgy of rent seeking and looting of the state. Why the difference?

“This takes us back to the history and in particular the history of the construction of the state. As we saw in our previous post, the state in the Philippines was built from the bottom up in a way which facilitated its capture by the oligarchy. This captured state was highly patrimonial, largely lacking meritocratic recruitment and promotion of the bureaucracy for example. Appointments were made on the basis of political criteria, for example, ability to help win elections.

“The history of the state in South Korea was very different. As Peter Evans pointed out in his seminal book on comparative economic development, Embedded Autonomy, the Korean state developed by Park was able to tap into a rich history of meritocracy dating back to an examination system which the pre-colonial Korean state had adopted from imperial China. Both Park and Marcos tried to build the state, but they worked in the context of very different historical legacies and contemporary politics. In Korea, land reform had obliterated much of the traditional elites.

“Ultimately, both Park and Marcos attempted to launch what we call ‘extractive growth’ in Why Nations Fail. This was a success in Korea but not in the Philippines because Marcos did not have the type of state that was capable for generating economic growth from above. In Korea, Park was able to create hard budget constraints, and credible rewards and punishments for economic success and failure. Marcos had no such option with his captured patrimonial state. Perhaps the looting started because he realized that Korean style industrialization was not an option in the Philippines (though in fact there is evidence that it dates back to the 1960s).

“All that being said, as we also point out in Why Nations Fail, even Korean growth could not have been sustained without the transition to inclusive political institutions and away from Park’s authoritarian regime.

“But equally importantly, the Philippines experience also suggests that extractive growth is not even a transitory option for countries lacking the type of centralized state that Park inherited and strengthened.”

This blog has talked about the imperative of an ecosystem, both hard and soft elements, that is demanded by a well-crafted and articulated vision. Since we don’t have that heritage, for example meritocracy that undergirds institutions, all the more we need visionary and strategic leadership that values community and the common good.

In short, Pinoy “kuro-kuro” and retail politics or a reactive psyche would be way too feeble an effort to right the ship we call PHL.

“Alas! The Filipino people are running out of patience. And reason is losing its grip on public consciousness. The Philippines will either have to create a genuine democracy or (once again) fall into an autocratic trap.” [The end of Philippine democracy, Richard Javad Heydarian,, 11 Apr 2016]

“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]

“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]

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