“What are we doing in this god-forsaken place?”

The wife would express the lament during the early days they were coming to Eastern Europe. They were brought to their knees after decades under Soviet rule, became the most impoverished country in Europe. The writer’s friends kept saying, “The mentality of our people needs to change. They can’t see the way forward.”

The words came back from reading the following about the Philippines: (1) ‘My world stopped spinning’: Life on hold for millions of overseas Filipino workers; Reuters, inquirer.net, 23rd Jul 2020; (2) Lost momentum, Cielito F. Habito, NO FREE LUNCH, Philippine Daily Inquirer, 28th Jul 2020; (3) ‘Optimism and hope’(?) Editorial, Philippine Daily Inquirer, 29th Jul 2020.

“He had a visa and just the job – six months of work at sea and thousands in pay to send home. Then the virus struck. And like millions of other migrant workers who leave the Philippines to work abroad and send their earnings back, a whole family saw its lifeline cut.

‘I was broke. Things were not easy for my family and me. I badly needed to go back to work at that time, so I was looking forward to that trip. My world stopped spinning,’ Carlos Salvador Jr., 33, who has been a sailor for nine years, told the Thomson Reuters Foundation by phone from the Iloilo province.

“His cousin, a deck officer on another ship, was similarly caught up in the lockdown and grounded.

“Remittances by overseas Filipino workers reached a record high of $33.5 billion last year. But as global coronavirus cases keep climbing, up to 400,000 OFWs were projected to lose their jobs or take a pay cut this year.

‘This year’s projected remittance totals may be the steepest decline in Philippine, 45-year migration history.’

“The Philippines needs these remittances more than ever.”  [Reuters, op. cit.]

“We have also been seeing significant and accelerating declines in our foreign direct investment (FDI) inflows for three years now, since peaking at $10.3 billion in 2017. That was a year when we outpaced Malaysia and Thailand owing to their political troubles then. Indonesia had twice, Singapore had nine times, and Vietnam had $4 billion more than we got.

“Since then, these comparable neighbors, except for still troubled Thailand, have seen their FDI inflows increase, cashing in on the reported exodus out of China induced by the trade war. But our FDI record shows a disheartening -4.1 percent decline in 2018, a much steeper drop (-23.1 percent) in 2019, and an even more precipitous drop of -36.2 percent as of first quarter of this year.

“Meanwhile, Thailand’s FDI jumped more than five-fold in the same quarter. If you’ve seen their promotional video explaining what they’ve done to reopen their economy, you’d understand why. Our FDI slide, then, is an internally inflicted problem, not externally driven.

“For decades, we’ve known what’s wrong in our country and with the people who lead and live in it, and perennially hope for change that must start within us. We discuss our woes endlessly, but in the end, do nothing to change it.” [Habito, op. cit.]

In the meantime, where is Philippine leadership?

“Threats and a full-frontal attack marked President Duterte’s fifth State of the Nation Address on Monday. But there was nothing to chew on what was most awaited:

There was no straightforward presentation of where the nation stands in the fight against COVID-19.

And the administration’s strategy to address the pandemic.

And the massive unemployment – particularly the poor – that is now choking the economy.

“In the meantime, the Department of Health’s daily bulletin registered an uptrend while Mr. Duterte delivered his speech. That updated count served as a damper on his opening lines — ‘Let us not despair, a vaccine is around the corner’— and on his assurance that the Philippines was now in ‘a better position to weather’ the public health crisis.

“He didn’t say what constituted that better position. The promised optimism and hope didn’t come.” [Editorial, op. cit.]

Wasting no time, “Senate Minority Leader Franklin Drilon rebuked President Rodrigo Duterte after he accused him of defending the owners of shuttered media giant ABS-CBN.

‘I was defending the freedom of the press, not the Lopezes. The closure of the ABS-CBN sent a chilling effect,’ Drilon said in a statement.

‘As I said before, for democracy to thrive, we need a free press and allow journalists to exercise complete freedom to do their mandate of reporting facts without fear,’ Drilon went on.

“He said he was also defending the 11,000 ABS-CBN employees who are in danger of losing their jobs in the middle of a pandemic and not the Lopezes. ‘In the face of a pandemic, we need more access to information,’ Drilon said.” [“Drilon rebukes Duterte: I was defending press freedom, not the Lopezes,” Christia Marie Ramos, Inquirer.net, 27th Jul 2020]

What to do? Our challenges are not new. Why haven’t we learned from experience instead of confirming Einstein’s definition of insanity?

We can’t get off the insanity paradigm because of what we call our values. We wanted to address rural poverty and assumed the comprehensive agrarian reform was the answer. Instead, we undermined economies of scale and ceded competitiveness. We championed overseas employment instead of pushing industrialization. Worse, we didn’t break the back of poverty as our neighbors did. And families are paying the massive social costs with the breadwinners based overseas.

In the meantime, we kept bragging about the economy when OFW remittances and BPO revenues principally drive it.

They reveal where we are in human development, unable to move up to “relativism” – from “absolutism or dualism.” But then again, it is a function of the lack of experience in progress and development. [And we continue to struggle with “experience being the best teacher”? Look at Singapore and Vietnam. The former is more competitive than the US, while Vietnam is outpacing Singapore. The science of metacognition supports that given.]

“For decades, we’ve known what’s wrong in our country and with the people who lead and live in it, and perennially hope for change that must start within us. We discuss our woes endlessly, but in the end, do nothing to change it.” [Habito, op. cit.]

With due respect to Ciel, if we knew what’s wrong, how did we celebrate our GDP growth rate of 6%-6.5%, counting several years? We know what’s driving the economy and that we’re stuck as a service-consumption economy. But we chose to brag about our fiscal and monetary efforts.

Consider this news item seven years ago: “BPOs should work to move up the value chain, says tech investor,” ABS-CBN News, 13th Feb 2013.

In other words, one of the economic drivers suffers from suboptimization as well.

And with OFW remittances to contract, it confirms that we have been living on borrowed time with our two-income streams. But we never lifted a finger. To add insult to injury, we celebrated them when they were meant as stopgaps until we attained industrialization.

So, where are we? Or can we even figure out where we are? 

Consider this perspective: “The role of profits, Elfren S. Cruz,” BREAKTHROUGH, The Philippine Star, 30th Jul 2020.

“If a business is ready to transform its corporate purpose from stockholders to stakeholders, it must ask three questions. First, for whose benefit does the enterprise exist? To what extent are the expectations of each stakeholder met? What is the priority among stakeholders?

“If there is a conflict among each stakeholder's priorities, does one prevail over the other? Only when the stakeholders' priorities have equal weight can we say that the business is now socially responsible.”

Let’s hold it right there. Recall why the blog presented the challenge of replicating what Vietnam did to be poised to overtake Singapore. 

Vietnam attracted two of the most notable global brands, businesses with a track record in global competition, Samsung smartphones, and Apple AirPods. Global players, with their history, create and sustain a dynamic business model. In the Philippines, our perspective is otherwise, especially in a worldwide economic slowdown. It boils down to our inexperience in foreign trade and relations.

Samsung Vietnam generates more revenues than the combined output of our eight biggest companies. And the aggregate of their exports is roughly four times ours.

Even more damming, they are high-value manufactured electronic devices and yield much higher margins than our computer chips. Who is in a position to pay higher wages? 

Does it surprise us then that Vietnam has broken the back of poverty? What to do? That we must pay higher wages? This dilemma we face should haunt us for celebrating our 6%-6.5% GDP growth rate.

The reality is that we remain the regional laggard with over 50 million impoverished Filipinos. That while on paper, we are a fast-growing economy, our per capita income has not lifted us above a third-world country. We need a much bigger pie or GDP from an industrial-investment economy to generate high-value products and services, beyond our consumption-service economy, driven principally by OFW remittances and BPO revenues.

If we can’t internalize that, expect the Philippines to be the laughingstock of the region, if not the world.

Recall that the blog argues that undertakings must answer these simple questions: Where are we? Where do we want to be? How do we get there? The object of the exercise is to create an ecosystem that is a virtuous circle.

We readily see the obvious and the present but can’t visualize a virtuous circle. Recall the photosynthesis phenomenon and Maslow’s hierarchy of human needs. They are tools to facilitate forward-thinking. They are great examples to explain creativity and introduce innovation and lateral thinking.

Sadly, while neuroscience tells us that the chamber of the brain that does creative thinking is untapped in most people, we in the elite class – because of our bunker mentality, aka caste system – take it as unfounded.

But then again, why are we the regional laggard? Because our efforts continue to yield suboptimization.

Benchmark. Benchmark. Benchmark.

If we can’t overcome a static world view and instead accept that there is one system that matters, we won’t gain new insights.

Conflating our problems with the world – especially the wealthy nations in the West that are today going through post-industrialization, while we in the Philippines are yet to industrialize – can take our eye away from the ball. And we will mix apples and oranges.

It is similar to employing monetary and fiscal interventions that well-developed economies do as a matter, of course. We keep forgetting how our neighbors – once third-world like us – became wealthy nations. They did more than what classical economics preaches; they begged for Western money and technology. [And we can’t figure that out? We need lots of practice in forward-thinking, prioritizing, and leveraging Pareto – and overcome the crab mentality, as in teeing up all of 42 industry road maps.]

Unsurprisingly, our neighbors leapfrogged development. In contrast, we assumed that we could prosper by staying a service-consumption economy and adhering to monetary and fiscal cures.

If New York because of Wall Street can claim to be the center of the universe as a service-consumption economy, why not us?

We are an underdeveloped nation and are yet to create the ecosystem of an economy that is a virtuous circle. If we are to be serious about benchmarking, we must focus on our neighbors. That is comparing apples and apples, not apples and oranges.

Consider: The New York metro area (aka the Tri-state area) is home to over 20 million, with a GDP per capita of $85,000 – even much more than Singapore – producing goods and services to the tune of $1.718 trillion.

It is one of the most expensive places to live and do business. Real estate prices are way above average that shuts out even native New Yorkers from owning their homes.

Like any universe, there are the marginalized sections of the economy. That is why it is a blue state where social programs are more generous than those in red states, including subsidized housing and rents, unemployment insurance, and food stamps. Visitors will notice how public transportation caters to PWD.

Is everyone happy? Not following the financial crisis of 2008 and the Global Recession it yielded. 

Because the human condition we call greed is beyond any system – even in Eden. Any system? Recall what the Romanians did to Ceausescu? Romania did not suffer from an unfettered free market.

It is not an ism that is the answer to the challenges nations – rich or poor – face. As the wife expressed during the early days, they were coming to Eastern Europe, “What are we doing in this god-forsaken place?”

Let’s get back to “dynamism.”

Here’s a quote from a prior posting. “Why is our status as members of different political parties seem more potent than our shared love for America, our many areas of agreement, and our shared responsibility to solve problems and get results? Why are we more often opponents than colleagues? Why are we collectively allergic to the compromise and teamwork required to do what Americans expect of their Congress? Why can’t we get big things done for the American people?

“Because the system will tear us apart as it were. In American politics, winning isn’t winning unless the other side is losing and losing badly. That shouldn’t be – and it doesn’t have to be. This book proves it.

“Katherine and Michael argue that ‘it’s the system.’ Most important, they propose specifics on how we can fix it together. Their prescription is powerful. It is nonpartisan. What’s more, it’s doable.” [“The Politics Industry: How Political Innovation Can Break Partisan Gridlock and Save our Democracy,” Katherine M. Gehl, Michael E. Porter; Harvard Business Review Press, 2020.

“And the prescription by the authors of the above-referenced book is for the US to innovate again.”

Note they are not prescribing another “ism” for America but for the US to innovate again, aka dynamism.

For example, there is a movement comprising billionaires that are lobbying to simplify the tax code and eliminate the tax breaks that give the wealthy and corporations undue advantage. As Buffett says, he is paying lower taxes than his secretary.

Separately, there is the effort led by Buffett and Gates for billionaires to give away half if not more of their wealth. 

But let’s get back to the challenge we’re facing in the Philippines.

It is easy to prescribe a cure, especially an “ism.” But that reveals our static impulses – given that we value hierarchy and paternalism but not personal responsibility – even when no human-made system is perfect. For example, we cannot just pull something out of a shelf and plant it in the Philippines.

The Scandinavian countries’ systems can’t be transplanted – say to the Philippines – and operate as though in a vacuum. Recall how the German ambassador to the Philippines explained their federal system. That individual states had a heritage – and history – of self-government. Germany did not impose Federalism on a people that valued hierarchy and paternalism. Nor did they rely on political patronage and oligarchy.

Let’s pause once more. If Filipinos can’t embrace the ethos of “personal responsibility,” given our instincts, either Juan Tamad or Bondying will be our namesake, not Juan de la Cruz.

Benchmark. Benchmark. Benchmark.

Instead of an ism, we better learn how to adapt to other nations’ best practices. See above; the socialism of Romania ended up as a failure. And the much bigger folly was the Soviet empire.

Russia, for example, remains a developing country dominated by the oligarchy. If the Philippines is yet to industrialize, so is Russia. It is dependent on oil. It remains a communist that supposedly embraced the free market, but it can’t show its spoils as China or Vietnam are doing.

In other words, isms aren’t as universal as people assume. People can undo Eden as Adam and Eve did.

Unsurprisingly, the US system is likewise imperfect. But we must comprehend the ethos of “personal responsibility” if we want to dissect it. We cannot measure it armed with our instincts of parochialism and insularity. And our values of hierarchy and paternalism. And reliance on political patronage and oligarchy. And with a culture of impunity.

With due respect to Elfren, even with Bernie Sanders and AOC in the socialist school, it doesn’t follow that the average Joe is. The choice of a middle of the road guy like Biden to go up against Trump says it all.

On a personal note, the writer has spent most of the last 17 years living and working with people born and raised as socialists under Soviet rule. Today, these people live the life of an MNC with Romania, Bulgaria, and Ukraine as their most important markets, while New York, Germany, and the UK are the fastest-growing ones.

How deep do Sanders and AOC understand the ism they are preaching? They can’t even explain how America can pay for the social programs they offer, given they come from assumed knowledge and zero experience. 

Recall the US spends $700 billion for defense. That is how the US navy can patrol the South China Sea, among others. Despots won’t disappear anytime soon, and so the world needs a hegemon. Despite Trump’s attempt at a quid pro quo, Congress continued to fund the needs of Ukraine.

The wife and writer had an intimate dinner with the ex-president of Bulgaria and another Bulgarian couple. Given their background – under and after Soviet rule – can distinguish the realities between an ism and dynamism.

Problem-solving is not about adopting an ism. It is about dynamism. The object of the exercise is to create an ecosystem that is a virtuous circle. The effort is ceaseless, given the universe is a 24/7, dynamic phenomenon.

There is no free lunch. Otherwise, we can only be lamenting, “What are we doing in a god-forsaken place like this?”

Gising bayan!

“Here is a land in which a few are spectacularly rich while the masses remain abjectly poor. And where freedom and its blessings are a reality for a minority and an illusion for the many. Here is a land consecrated to democracy but run by an entrenched plutocracy, dedicated to equality but mired in an archaic system of caste. 

“But the fault was chiefly their own. Filipinos profess the love of country, but love themselves – individually – more.” [Ninoy Aquino, Foreign Affairs magazine, July 1968; Stanley Karnow, New York Times Magazine, “Cory Aquino’s Downhill Slide,” 19th Aug 1990.]

“Why independence, if the slaves of today will be the tyrants of tomorrow? Moreover, 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]

“True social reform has little to do with politics. To unmoor ourselves from the burdens of the past, we must be engaged in the act of continual and conscious self-renewal. All men are partially buried in the grave of custom. Even virtue is no longer such if it is stagnant.

“Change begins when we finally choose to examine critically and then recalibrate the ill-serving codes and conventions handed down to us, often unquestioned, by the past and its power structures. It is essentially an act of imagination first.” [David Henry Thoreau; American essayist, poet, and philosopher; 1817-1862]

“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]

“You have to have a dream, whether big or small. Then plan, focus, work hard, and be very determined to achieve your goals.” [Henry Sy Sr., Chairman Emeritus and Founder, SM Group (1924 - 2019)]

“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]

“Now I know why Paul dared to speak of ‘the curse of the law’ (Galatians 3:13). Law reigns and discernment is unnecessary, which means there is little growth or change in such people. When you do not grow, you remain an infant.” [Faith and Science, Open to Change, Richard Rohr’s Daily Meditation, 23rd Oct 2017]

“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]