Tuesday, June 8, 2021

Habits are too hard to break.

And that is universal. Be it in Europe, the US, or the Philippines.

And I can relate to the articles below, being a resident of all three locations.

From Europe: (1) “Europe is now a corporate also-ran. Can it recover its footing (?),” The Economist, 5th Jun 2021; (2) “Europe’s history explains why it will never produce a Google,” The Economist, 13th Oct 2018. They were written three years apart and confirm that habits are too hard to break.

And from the US: “You Should Learn the Truth About the Tulsa Race Massacre,” Tom Hanks, The New York Times, 4th Jun 2021. That happened a hundred years ago. Is denial a habit that is too hard to break that it took a hundred years for someone to step up to the plate?

Now, let’s go the Philippines: (1) “Duterte-Duterte tandem a 'final stop' in the decades-long rise of dynasties — analysts,” Bella Perez-Rubio, Philstar.com, 4th Jun 2021; (2) “The Mandanas Ruling, Bayanihan III, and the pandemic: Imperative for devolution,” Luisito V. Dela Cruz, BusinessWorld, 3rd Jun 2021; (3) “Reviving domestic industries,” BERNIE CAHILES-MAGKILAT, EDITORS DESK, Manila Bulletin, 4th Jun 2021; (4) “Brownouts: Disaster-in-waiting for PH’s economic recovery,” Editorial, Manila Bulletin, 3rd Jun 2021; (5) “Learning crisis and complementarity,” Edilberto C. de Jesus, BUSINESS MATTERS, Philippine Daily Inquirer, 5th Jun 2021.

Are we still surprised about the political dynasties in the Philippines?

Recall our instincts that the blog never fails to raise: We are parochial and insular. We value hierarchy and paternalism and rely on political patronage and oligarchy that ours is a culture of impunity.

In other words, despite our proudly professed faith, our habits have kept us in the dark, i.e., what this faith means.

And why the blog keeps reminding us that democracy is the mirror image of Christianity, i.e., the imperative of personal responsibility for the common good.

Unsurprisingly, we invoke paternalism to define “inclusion.” What are we missing? That paternalism explains our crab mentality because the common good presupposes personal responsibility.

Is that why we are talking about reviving domestic industries? Question: What industries are they?

Have we forgotten that we are a consumption-service economy, and the OFW remittances are driving the economy?

What are we missing, or is it a manifestation of denial?

Did we not applaud Arangkada because we knew we had to move beyond a consumption-service economy to an investment-industrial economy? Sadly, by the end of the Duterte administration, we would have wasted a dozen years (including the Aquino administration) in pursuing industrialization – and we’re still languishing. And that is why we want to keep the Duterte dynasty?

Didn’t our neighbors demonstrate to the world how to traverse poverty to prosperity? Is that how we overcome our narrow definition of our challenge, i.e., of addressing poverty? Can we reconcile our bias for inclusion to the imperative of traversing poverty to prosperity?

It is more than semantics – as in the distinction between orthodoxy (correct belief) and orthopraxy (proper conduct.) Recall Padre Damaso and why the blog often raises the difference. Or binary or dualistic thinking versus relativism. Or unity instead of uniformity.

That’s why the blog challenged our worldview. Should we embrace dynamism and interdependence instead of hierarchy and paternalism? And all we need to do is to benchmark against our neighbors. It is not rocket science.

Consider: If it is not “tubig” that we howler about, it is “kuryente”!

We’ve had this problem even before the family relocated to New York over three decades ago.

And it does not stop there!

“A World Bank forum added weight to the appeal sounded by PBEd (Philippine Business for Education) last year for action on the country’s learning crisis. The pandemic damaged and continues to degrade the educational system. Both public and private schools have suffered, adding greater urgency to the goal of promoting greater complementarity between them. But the learning crisis predated the pandemic.” [de Jesus, op. cit.]

Rizal was hoping that “the youth is the hope of our future.” Not if we have a learning crisis – on top of a culture of impunity courtesy of political dynasties and oligarchy and an underdeveloped economy that can’t provide Juan de la Cruz his basic physiological needs.

That is not to promote socialism but to demand replicating what our neighbors have achieved – traversing poverty to prosperity.

And that is how our worldview, courtesy of our instincts, consigned us to regional laggard.

Here’s a quote from an earlier posting: “Can Juan de la Cruz embrace a worldview characterized by dynamism and interdependence?

“It is not if we stick to our caste system, i.e., to preserve hierarchy and paternalism – aka dependency.

“When we come down to it, we confirm Rizal’s worst fears: He who submits to tyranny loves it.

“And that is how autocracy continues to thrive in many countries and why the world remains a tinderbox.

“Consider: We are parochial and insular. We value hierarchy and paternalism and rely on political patronage and oligarchy that ours is a culture of impunity.”

Recall that Samsung Vietnam generates more revenues than the Philippine top eight companies combined.

“I received this e-mail from a senior Korean business executive who was reacting to a column I wrote on Vietnam and how it overtook us in economic growth.

‘Your column on 12th Feb was quite instructive for me. I’ve been thinking it over, and I suggest you write another column on ‘Why Samsung Electronics went to Vietnam.’

‘In 2008, the big boss of Samsung was here in the Philippines to evaluate the business conditions on which country is the best for them. But finally, Samsung chose Vietnam. Not the Philippines.

‘This is quite an interesting story because the Philippines still has the same way of thinking as in 2008. There are many restrictions and limitations on foreign investors here in the Philippines. Under these restrictions, I am sure no big Korean investments will come.’” [“Filipino last (?),” Boo Chanco, DEMAND AND SUPPLY, The Philippine Star, 7th Jun 2021]

Beyond our neighbors, can the Europeans’ challenge teach us – the Philippine elite class and the chattering classes – lessons too?

“Nearly five decades after Steve Jobs founded Apple, it is now worth more than the 30 firms in the German blue-chip DAX index combined. Its value is not far off that of all 40 companies in France’s CAC index. Apple’s success has been notable, but it is the decline of corporate Europe that is truly striking. At the start of the 21st century, 41 of the world’s 100 most valuable companies were in Europe (including Britain and Switzerland but excluding Russia and Turkey). Today only 15 are.

“How did European companies fall behind their American competitors?

“The first reason is that its firms are lackluster. Look at firms competing in the same sector over the past 20 years, and incumbent American companies more often than not went on to churn out more significant profits and are better positioned for future success than their European counterparts.

“There are many exceptions to this rule. But by and large, it has been better to bet on Nike of America over Adidas of Germany, JPMorgan Chase in New York over Credit Suisse in Zurich, or America's Walmart over France’s Carrefour. Their advantage in terms of profits and sales growth is often tiny but compounds over time.

“A second reason Europe fell behind in recent decades is that its biggest firms are in the wrong industries. The sectors European firms dominated 20 years ago, such as insurance or telecoms, have grown slowly. Even if European firms did well, as many did, they mattered less as the world moved on. America, by contrast, had already made significant inroads into software and e-commerce, industries that would soon redefine the global economy and generate trillion-dollar valuations.

“The third, and most striking, reason Europe has fallen behind is the lack of newly created firms in its blue-chip indices. Many of the biggest companies in America, such as Amazon, Netflix, Tesla, or Facebook, are young enough to be run by their founders. In Europe, old names prevail.

“Of the world’s 142 listed firms worth over $100bn, 43 started from scratch in the past half-century, 27 in America and ten in China. Only one was in Europe: SAP, a German software group founded in 1972. Half of Europe’s richest ten billionaires inherited fortunes spawned long ago; in America, nine of the top ten are wealthy solely because of companies they founded.”

What is The Economist demonstrating? That they, the Europeans, must benchmark against the best in the world.

But we Filipinos struggle to distinguish patriotism – which in its extreme spawns fascism – from the common good. Is that why it distressed Rizal – that we submit to tyranny because we love it?

Consider: Is The Economist disloyal by demonstrating how Europe must benchmark against the world’s best? Or are we doing a disservice – as in ours in a culture of impunity – to Juan de la Cruz by our value of hierarchy and paternalism – i.e., that we rely on political dynasty and oligarchy?

Let’s give the final word to Tom Hanks: “America's history is messy but knowing that makes us a wiser and stronger people. 1921 is the truth, a portal to our shared, paradoxical history. An American ‘Black Wall Street’ was not allowed to exist, was burned to ashes. More than 20 years later, we won World War II. That was despite institutionalized racial segregation; more than 20 years after that, the Apollo missions put 12 men on the moon while others were struggling to vote, and the publishing of the Pentagon Papers showed the extent of our elected officials’ willingness to lie to us systemically. These lessons chronicle our quest to live up to the promise of our land. To tell truths that, in America, are meant to be held as self-evident.”

Yet, it took a hundred years before someone stepped up to the plate.

Habits are too hard to break.

And that is universal. Be it in Europe, the US, or the Philippines.

But do we wish to see Juan de la Cruz the laughingstock of the region, if not the world?

Gising bayan!

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