In other words, if the Philippines were a car, are we a lemon?
“What Qualifies as a Lemon? For a vehicle to be considered a lemon, the car must 1) have a ‘substantial defect’ that occurs within a specific time after purchase, and 2) continue to have the defect after a ‘reasonable number of repair attempts.’
“Substantial Defect. A substantial defect is a problem that impairs the car’s use, value, or safety. The defect must be covered under the express warranty and affect a serious function or expectation of the car. The legal line drawn between ‘substantial’ and minor problems isn’t always clear and varies from state to state. No matter what state in which you reside, the defect must occur within a specific period or a certain number of miles.
“Reasonable Number of Repairs. If your car has a substantial defect, the dealer or manufacturer – or both – is then given a reasonable number of attempts to repair the problem before the car can be declared a lemon.” [findlaw.com]
Consider: “Owning up to policy failure: Why does it matter (?),” Anne Lan K. Candelaria, Blueboard, BusinessWorld, 12th Apr 2021. Candelaria, Ph.D., is the Associate Dean for Ateneo de Manila University’s Loyola Schools’ Graduate Programs. She is also an Assistant Professor at the Department of Political Science.
“Statistics and numbers can’t explain the impact of policy failures on the lives of ordinary Filipinos. There is no perfect policy; therefore, they do indeed fail. But for failure to matter, it should be seen as a learning opportunity. All policy failures should induce policy change through a learning process — we often call this ‘reform.’ Chris Agyris’ work on Organizational Learning is helpful at this point.
“Like human beings, an organization can learn, too, and it does so in two ways. First, when we know what does not work, we can make the necessary adjustments and improve the policy tool (i.e., single-loop learning). Second, an organization can also learn from failure by rethinking the fundamental assumptions and values that support the policy’s logic (i.e., double-loop ‘learning’).
“Perhaps the hesitancy in admitting that policies fail is because in doing so, leadership must take the blame. When the regime opens its legitimacy to challenge, the most rational decision will be politically feasible rather than scientifically sound.
"In schools, we teach our students to embrace failure as this is the greatest of teachers. In life, leadership is not about being right all the time; but learning from mistakes. The point is that unless policymakers acknowledge that there is indeed policy failure, learning cannot take place.
“And the soonest they do this, the better. It takes both courage and humility to accept failure, most especially if one’s reputation as a politician and policymaker is at stake.
“In the end, a crisis brings out the best and worse in both people and government. The quality of decisions made are narratives of the ailments of our political institutions and processes. It is, therefore, part of our collective duty as citizens in a democracy to speak about policy failure.
“Because it is only through the storytelling of failure can the learning process of people, organizations, and institutions begin.
“Public policies are complex, and so are the factors that affect their implementation. There are several reasons why a ‘policy’ is considered a failure. For example, incomplete information at the time of the decision, the changing circumstances across its period, and the inability to think of ‘policies’ interconnectedness,’ i.e., designing something narrow and shortsighted).
“And then there are failures from factors that are structural — such as when the causal theory (i.e., what causes ‘Y’) that is the basis of the ‘policy’ is not sound, and when political institutions break down.
“The former refers to the extent upon which policymakers consider and use accurate and reliable evidence to inform their decisions. On the other hand, the latter is the magnitude by which political power takes policymaking hostage.
“In both situations, policy failures are not just the result of the limitation of information, technology, or even cognition; but it is a product of our ailing political institutions and systems which affect our political processes including policymaking.”
Let’s do a recap: The two overarching reasons why a policy is considered a failure are (1) the incompleteness of information at the time of the decision, the changing circumstances across its period, and the inability to think of the interconnectedness of policies – and therefore, designing something narrow and shortsighted; (2) brought about by structural factors — such as when the causal theory (i.e., what causes 'Y') that is the basis of the policy is not sound, and when political institutions break down.
Simply put, a policy can be (a) shortsighted, (b) structurally unsound, or (c) both.
Let’s pause right there.
Recall that several years ago, we were celebrating what we called a manufacturing uptick. Yet, as the blog has argued, we have a structural problem and why our problem-solving has been (a) shortsighted, (b) structurally unsound, or (c) both.
They are no different from our celebrating (a) the OFW phenomenon, (b) the comprehensive agrarian reform, or (c) the 4 Ps.
Consider: “One of the advantages we had relative to many other comparable economies as we entered the pandemic crisis last year was a strong government financial position. Our public debt-to-GDP ratio was relatively low at 40 percent, compared to well over 100 percent for other economies, including Singapore and the United States. We thus had ample leeway to borrow funds through the crisis without endangering our fiscal stability. We ended the year with government debt reported at P9.8 trillion or 54.5 percent of GDP, up from P7.7 trillion in 2019.” [“Doing stimulus right,” Cielito F. Habito, NO FREE LUNCH, Philippine Daily Inquirer, 13th Apr 2021]
Can we again pause and ponder?
With due respect to Ciel, are we better off than Singapore or the US if only we do the stimulus right?
Isn’t the reality that we were the regional laggard and inferior to Singapore before the pandemic, let alone the US?
Why? Because our problem-solving has been (a) shortsighted, (b) structurally unsound, or (c) both.
That is why the blog often speaks to the Asian Tigers. On the other hand, we keep trekking along with our problem-solving informed by our worldview or instincts.
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, until we move beyond a consumption-service economy and into an investment-industrial economy, we will not overcome our structural deficiencies.
Fiscal and monetary policies within our economic model – of a consumption-service economy – can make us a strong two-stroke engine but will never be a Formula-One racer akin to that of the Asian Tigers.
Put another way; the inability to think of the interconnectedness of policies explains our dilemma.
We can put two or more modern international airports, dredge Pasig River, connect the North and South expressways – get a few of our tycoons on the Forbes billionaires list – and we will still be the regional laggard.
If we can’t see the reality of our inferior position – as in our top companies can’t match one Vietnam’s enterprise among others – we will sink deeper into the abyss, with or without Covid-19.
If the Philippines were a car, we are a lemon – and stuck in a defective economic model.
Gising bayan!
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