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| ON THE OTHER HAND |
| The Failure of Revolution By Antonio C. Abaya Written Nov. 08, 2005 For the Standard Today, November 10 issue Or The Revolution of Failure. Either title is appropriate for this piece, which is occasioned by a reaction to my article �Leftists and Communists� of October 18, from Reader Ferdinand Anno, who gave his address at Union Theological Seminary, Dasmarinas, Cavite. In that article, I had written that one of the questions that Filipinos in 2005 should ask is: why does a communist insurgency still persist in this country when it had long been extinguished in Indonesia, Malaysia, Thailand and Singapore, and was never allowed to rear its head in Taiwan and South Korea? I wrote that it would require an entire column or more to discuss it. Reader Anno, who is either a communist or a pro-communist, has dared me to answer that question. His letter appears in full in www.tapatt.org under the article in question. If you remove the gratuitous and sarcastic personal insults in it, what you have is an angry outpouring from a true believer whose core beliefs, founded on a fundamental ignorance of economics and global developments, and a na�ve view of human nature, are being questioned. The basic reasons why the Philippines is still plagued by a communist insurgency long after our neighbors � who were much poorer than us up to the 1960s � had overcome theirs are largely economic. But there are also political and social reasons for it. First the economic. As I explained in my article �Why Are We Poor?� (Dec. 14 2004), and other, earlier articles (all archived in www.tapatt.org), our economic malaise can be traced to the late 1950s when the Philippine Congress passed the Minimum Wage Law, a minor monument to American social liberalism. As a member of the Social Order Club in the Ateneo then, I can, with hindsight, admit my participation in the misguided pressure to have this law passed as we joined strikers� pickets organized with the help of labor priest Fr. Walter B. Hogan SJ. Misguided because, in the 1960s, when American companies started to move their manufacturing facilities to the Far East, most of them chose Taiwan or Hong Kong; relatively few chose the Philippines. Why? Because wages then, believe it or not, were lower in Hong Kong and Taiwan than in the Philippines. And, more importantly, Hong Kong and Taiwan had no minimum wage law; the Philippines had one. This despite the fact that most Filipino workers spoke or at least understood some English, while most Chinese workers in Hong Kong and Taiwan then did not. Despite the other fact that Filipino managers were already familiar with American business practices, while most Chinese managers then were not. So our competitive advantages were nullified by the bottom line: the cost of labor. Because our labor was more expensive and because we had a minimum wage law, we began to lose out to Hong Kong and Taiwan as early as the 1960s. Our initial statutory wage was, believe it or not, seven pesos a day. But since the rate of exchange then was two pesos to one dollar, that amounted to US$3.50 a day. In 2005, the statutory minimum wage is P325 in Metro Manila. But since the rate of exchange now is about P55 to the dollar, that is equivalent to only $5.91 a day. So in US dollar terms, our statutory minimum wage increased from $3.50 to $5.91, or by only $2.41 in 48 years, or a measly average of only five cents every year, discounting inflation and the fluctuating value of the dollar. Only the insurmountably stupid and the hopelessly uninformed will conclude, as Mr. Anno�s comrades no doubt will, that the Filipino �elite� have no feelings for the �poor� and deserve to be pulled down to the dust. What the niggardly small annual increases in our daily minimum wage, in dollar terms, really means is that there were not enough economic activities in this country during those 48 years, to drive wages up significantly, in dollar and, therefore real, terms. Wages do not need any artificial boost from Congress to go up if there are frenetic business activities in an economy. Entrepreneurs, impelled by their own self-interest, will push wages up as they bid higher and higher for the workers and employees that they need to man their companies, from a pool of unemployed and underemployed that shrinks smaller and smaller. (The pursuit of private profit does drive wages up, Mr. Anno, but you and your comrades may not appreciate that because you have been conned into believing in Marx�s theory of surplus value, that profit-making is synonymous with exploitation.) No more dramatic proof is there of this than our own economic history compared to Taiwan�s and Hong Kong�s, as cited above. Without the help of any minimum wage law, wages in Taiwan and Hong Kong, initially lower than the Philippines� in 1957, have climbed up and are now 15 to 20 times higher than ours, to the same level, or close to it, as Southern Europe�s and Australia-New Zealand�s. In Malaysia, they passed a minimum wage law in the 1980s. Without being later raised by parliamentary fiat, wages have climbed up way past that minimum, as Malaysian and foreign entrepreneurs bid higher and higher for workers and employees from a continually shrinking pool of unemployed and underemployed. If Mr. Anno and his comrades were to set up a company in Malaysia to manufacture, say, hammers and sickles, and were to magnanimously advertise that they were going to pay the statutory minimum wage, nobody will work for them as people know that they can easily get much higher-paying jobs elsewhere. Without the statutory minimum wage being raised. Does this mean that the Malaysian, Taiwanese and Hong Kong �elites� have a greater compassion for the �poor� than the Filipino �elite� do? Of course, not! It merely means that there is, was and have been more business activities in Malaysia, Taiwan and Hong Kong than in the Philippines, and even the most stupid and uninformed comrade can tell that from even only a one-hour flying visit to Kuala Lumpur, Taipei and Kowloon.. Now, the question is: why have there been more business activities in these other countries than in the Philippines? And the answer, largely, is poor choices in economic strategies. In 1965, when East Asian countries were exporting mainly agricultural and extractive commodities, the Philippines was the leading exporter, aside from industrial giant Japan. Resource-rich Philippines� exports that year totaled $769 million, while those of resource-poor Taiwan and South Korea were only $446 million and $175 million, respectively.. But in the 1970s, Taiwan and South Korea, along with Hong Kong and Singapore, deliberately geared their economies to the export of manufactured goods. The Philippines did not, or at least not to the same extent that the four original tigers did. In 2003, South Korea�s exports totaled $201.3 billion, Taiwan�s, $143 billion, Singapore�s $142 billion (from a population of only 4.3 million people). Hong Kong�s were also in that vicinity, but are now incorporated into China�s.. The Philippines exported only $34.6 billion worth of goods in 2003 (from a population of 80 million), having chosen a �nationalist� economic policy of import substitution, rather than the export of manufactured goods. In the 1980s, Malaysia, Thailand and Indonesia also geared their economies to the export of manufactured goods, in addition to their traditional exports of commodities. The Philippines again continued to pursue the dead-end path. In 2003, Malaysia�s exports totaled $98.4 billion, Thailand�s $76 billion, Indonesia�s $63.9 billion, all way ahead of the former leader, now laggard, Philippines� $34.6 billion. No one, Mr. Anno, neither the IMF nor the World Bank nor the evil Americans, forced us to pursue our dead-end policy. This was the sovereign choice of our own national leaders, helped along by the agitprop activities of the communist movement, your comrades, whose ideologues argued against an export-oriented economy and whose KMU militants staged strike after strike (demanding even the dismantling of US military bases!) against the hapless locators in the Bataan Export Processing Zone in Mariveles � Marcos� initial feeble attempt at the export of manufactured goods � until they got fed up and left and moved their export-oriented factories to other countries in the region. More about this in the succeeding article. What do these export figures have to do with endemic poverty and a persistent communist insurgency? Plenty. Because of a poor choice in economic strategy, we have not been able to create the jobs needed, in the numbers needed, to rescue millions of our people from poverty � as South Korea, Taiwan, Hong Kong, Singapore, Malaysia, Thailand and, to a lesser extent, Suharto�s Indonesia successfully did for their people. Their success, achieved largely through the export of manufactured goods, spelled the failure and early demise of the Communist Revolution in these countries. On the other hand, our impoverished people, who do not know any better, have become easy prey to the blandishments of communist agitators, who had deliberately blocked the very economic strategy that created the economic success of ALL our significant neighbors, and absent which we have fallen into our economic rut. The tunnel vision of your comrades, Mr. Anno, is as much directly to blame for our economic failure as the corruption and incompetence of the trapos and the supposed greed of the elite. (To be continued). ***** Reactions to [email protected] or fax 824-7642. Other articles in www.tapatt.org OOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO |
| Reactions to �The Failure of Revolution� I guess your premise on high wages must be correct because you are from Ateneo. Anyway let me know what you think of the ideas of two guys who seem to know a little about economics. See links. One of the pieces has a good rationale of why smuggling is prevalent in a third world country. (informal sector) It is so current most especially with the VAT controversy ongoing. Price arbitrage and all that. It is also a good link to learn about monetary or financial capitalism as evolved from industrial capitalism. http://www.project-syndicate.org/commentary/stiglitz31 http://www.project-syndicate.org/commentary/stiglitz29 http://www.project-syndicate.org/commentary/rodrik12 http://www.project-syndicate.org/commentary/rodrik5 http://www.project-syndicate.org/commentary/rodrik4 By the way, maybe you can answer this simple question. It was propounded by Peter Drucker. Which comes first civil society or neo-classical economics? Does the free market create civil society? P.S. Did you know that China has a minimum wage (including benefits) as high as ours today? Do you know the effects of a managed currency and managed capital costs. Have you ever heard of depreciation in state industries? It is so nice to be able to talk to God. R. Hiro Vaswani, [email protected] November 09, 2005 MY REPLY. The Chinese minimum wage is news to me. Where can I access information about it? I will ponder the questions you posed. In the meantime, when talking to God, please remember to grovel. wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww Tony, There is a minimum wage law in China implemented in the mid 90s, but what is such a law in a communist country? It's useless. The poor are still taken advantage by cheap labor law. If in a democratic nation the labor law is one of the most violated law , what more in a communist state? The minimum wage in China is really very minimum, almost useless. From http://www.lehmanlaw.com/FAQ/faq/HR.htm Is there a minimum wage requirement in China? The Labour Law provides a minimum wage requirement, which is determined at a provincial level. The 1993 Regulations on Minimum Wages in Enterprises (amended in October 1994) require all provinces, autonomous regions, and directly administered municipalities to set minimum wage standards and report them to the Ministry. Employers that fail to meet these standards may be ordered to compensate employees for the difference, pay other compensation, or both. Employers must also deduct and withhold employee individual income tax, social security and related payments. China's minimum wage is $60-$73 a month. The Philippine minimum wage is still higher (a bit more). Nonoy Ramos, [email protected] Pennsylvania, November 16, 2005 wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww I agree fully with your writings on communism. I hope you would write more so that the masses will be appraised of its evil. (No name given), [email protected] November 10, 2005 wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww (Copy furnished) I must say, that was my stand on that issue before i graduated from school However, there are several ideas that I want to get across 1. that even though it was largely due to economic reasons, our policy on population helped create a larger pool of workers which grew faster than economic activity could grow. Even with the minimum wage law, economic activity could still raise wages if it grew faster than our population growth. 2. our minimum wage law does not really reflect the cost of living and this is really unethical because that is really exploitation. How will a worker raise his productivity if he is unable to buy enough food to eat for three times a day? 3. I do not think that only wages are the reason(s) for setting up a business although it was one large factor before due to more labor-intensive industries before than capital-intensive industries. --I must agree that yes, the 1950's-1970's in this country would have been more competitive if labor was cheaper --However, in today's world, labor is no longer the major factor and therefore, minimum wages cannot be "the" reason why we are poor until now even if we factor historical mistakes in economic policies 4. how long will it take for the trickle-down effect economics raise the income of the classes D and E? This nation is never patient. Kaya tayo may lotto..It�s one reason why a forward-looking attitude is not a culture among us. Lagi gusto natin, now na 5. when will Filipinos ever learn to save?? But in a way, how will one save if the wages are not enough to cover the cost of living? Feedback very much welcome.. Just got into the labor force, I am getting a bit higher than minimum wage and I know how it feels that before I get to the next pay day, I don�t have enough money to save for myself. That already includes not enjoying weekends thru gimmicks with friends. I tell you it�s hard for me also, much of my expenses go to commuting alone. Add food and that�s more than 70% of my pay.. GOvvin <[email protected]> wrote: Read what Tony Abaya says regarding the law on minimum wage in his Manila Standard column today. http://www.manilastandardtoday.com/iserver?page=antonioAbaya_nov10_2005 Frederick Evan Chua, [email protected] November 10, 2005 wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww Dear Tony, Wages may have been cited as one of the reasons that keeps the communist movement alive in the Philippines. The other reasons are the cost of doing business in the Philippines, political instability, etc. The manufacturing portion of foreign companies have been pulled out of the Philippines; they (companies) hire a larger number of employees whose wages are easily eroded by inflation. I can relate to this because I worked for Johnson & Johnson before migrating to the USA for quite a number of years. Communist insurgency, I suspect, is like a weed being sustained by other forces rather than ideology. Don't despair, Tony, because English proficiency of Pilipinos will lead them to the service sector of the economy. Nestor Baylan, [email protected] New York City, November 10, 2005 wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww Tony, Another excellent piece. I am sure that your point about the introduction of a minimum wage is very pertinent, and also at the end of your article you allude to the fact that "corruption of the trapos " cannot be wholly blamed for the economic problem in the Philippines. Indeed I would suggest that corruption 'per se' is not the fundamental problem at all. It is what form the corruption takes and what else goes on at the same time that seems to matter. Corruption occurs everywhere, (and although, I suppose, morally undesirable) in many instances it is what 'oils the wheels' of economic expansion. Taking a 'backhander' from an entrepreneur to help him get permits/contracts etc. etc. so that he can more rapidly expand his business contributes to the increase in jobs and of wages etc., but taking 'backhanders' from established trapos-associated businessmen to put artificial obstacles in the way of the 'new' entrepreneurs to 'prevent the competition' has the opposite effect. Maybe the Philippines has too much of the later and not enough of the former. On the same general subject, but on a slightly different tack. Virtually the only email that I receive from the Philippines is yours, but my inbox is full of emails from Indonesian, Malasian, Chinese etc. businessmen inviting me to import their manufactured goods into Europe.. Similarly, the European TV and News Papers are full of adverts trying to attract tourists ( from any countries� point of view, a wonderful earner) to all the different Far East countries you can think of, except the Philippines. Have you, Tony, any suggestions why this should be? D. John Adams, [email protected] United Kingdom, November 12, 2005 MY REPLY. I wrote an article on the Philippines� tourism industry: �Wow, Philippines!� (July 08 2004) which you may find relevant to your question. wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww Thank you. The comments are also informative: Blame the 'Yanks' for distorting history!! Blame the positioning of the Lapulapu statue . What tourist cares who was Lapulapu, you can still pose for a photo in front of him!! The balikbayans will come anyway. Look for 'real' holiday maker tourists. D. John Adams, [email protected] United Kingdom, November 13, 2005 wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww I follow with great admiration articles posted by this fine author, who possesses a vast reservoir of knowledge. I applaud his continued lecture in this forum, especially to the red ones who caused the drag in the Philippine economy, the very groups that authored all the hardships to our brother and sister Filipinos; long been subjected into perdition. Along with communist and socialist riding high with duped mental landscape in the sea of hope, theirs are attitude of victim, trying hard to victimize the whole country. Woe to all of them and their avid sympathizers, like followers of hound dogs, pack of wolfs dressed in barong searching packs of followers from the gutters and among the mountain of trash! Our poor country, hijacked by political "trapos" and socialist minions, trying very hard to send all the living Filipinos back home to their untimely death and waiting graves! Paul Dalde, [email protected] Houston, Texas, November 13, 2005 wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww Dear Tony: Why there are still communists in the Philippines? The answer is simple and straightforward. There is no true justice in the Philippines for private citizens which are composed mostly of the poor notwithstanding the fact that sovereign majority and sovereign rule rest with them according to Article II, Section 1, of the Philippine Constitution. To provide justice for them, they should be made part of the sovereign deciding authority in justice by instituting the Grand Jury and Trial Jury Systems. By the decision of the poor people in our justice systems, they would be able to send all election cheaters and government grafters and their front liars to jail without firing a single bullet. For more details, the reader of this email is requested to browse the web site below: http://anticorruption.homestead.com/Justice1.html Currently, justice is the exclusive monopoly and property of crooked almighty government officials specially by the presidency and its cohorts for their personal enrichment and twisted empowerment. Marlowe Camello, [email protected] Homeland, California, November 13, 2005 wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww Dear Mr Abaya, I say Bravo to your excellent piece. I recall that in the 1970's Marcos attempted to gear the Philippine economy for exports. Back then I was working in the Board of Investments promoting export oriented industries. BOI then was the implementing arm of RA 5186 and RA 6135, which was copied by Thailand. But why did the attempt of Marcos fail. With the copied RA 5186, Thailand attained a degree of success. In the industries I visited, I witnessed the activities of militant KMUs and some other federations. They were not for the protection of labor. They used those organizations for political agendas. I saw many companies closed down and never opened again because of strikes abetted by these unions . Pity the workers in those export-oriented industries who at one time in their lives had the opportunity to improve their lot, but for the activities of those union federations lost that opportunity when their companies closed down. China, Korea, Taiwan and other developed Asian neighbors must have gone through the period of starvation pay for their workers. How they managed the unrest that attended those low pays is something to be studied. Was it by initial authoritarianism? Or was it due to some character of their people that our own people should have or should emulate? It will be interesting to explore further this area. Jorge Matanguihan, [email protected] November 13, 2005 wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww Mr. Abaya, What an article!!! I couldn't agree with it more. Very well articulated. Thanks. M. G. Espaldon, [email protected] Ayala Alabang, Muntinlupa, November 13, 2005 wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww The question to ask is how communistic the so-called "Communists" in the Philippines are. I have actually met a lot of Joma Sison's comrades-in-arms when they used to come here to solicit donations from sympathizers in the leftist movements in Japan, using Philippine problems like the problems of the OFWs, but I am not impressed. There are more devoted Communists in Japan than there are in the Philippines, the dye-in-the-wool followers of Karl Marx, Lenin, et al, who are far from being the "tulisan" that the followers Joma Sison have been reduced to, and who have become useful stabilizer in curtailing graft and corruption, and maintaining order in the state of affairs of this tiny island nation that has become an economic giant I have not met Joma Sison nor bothered to try to understand his Maoist ideology much less swallow it, simply because I am not enamored with the Chinese much less embrace their Chinese brand of communism especially when I saw what Communism did to China before the US started patronizing it and turning it into a giant capitalist of the 21st century! By political affiliation, I am a socialist, which is different from the communist contrary to what most ignorant Filipinos think they are the same just because no one in that seemingly forsaken land now ruled by a suspected criminal has bothered to give formal recognition to the former members of the HUKBALAHAP, who were outlawed after WWII just because Filipinos were not wiser enough to think that the US brand of democracy would not work on a people who had been used to slavery! Now, what you see in the Philippines is simple stereotyping of those who call for the removal of a suspected violator of the Election Code of the Philippines that is no different from stereotyping Filipino women in Japan as prostitutes who have earned the unpalatable name "Japayuki," a derogatory term applied only to Filipino women deployed as entertainers and engaging in prostitution in Japan. I guess this is also one of the reasons why a lot many Filipinos especially those adversely affected by bad policies of the graft and corruption riddled Philippine government hesitate to join the rallies and demonstrations now being led even by a former VP and some crusading members of the Philippine Senate and Congress. I feel sorry for Filipinos who have really not learned nor enjoyed to the fullest basic freedoms supposedly guaranteed and stated in the Preamble of the Philippine Constitution, especially the one that we used to recite in school there ages ago. Most Filipinos, especially in shantytowns, do not know that they have a right to demand freedom even from want. Those who do regrettably are lumped up with the communists! Yuko Takei, [email protected] Tokyo, Japan. November 13, 2005 wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww Excellent and concise. Well done! Dondi Joseph, [email protected] Cebu City, November 14, 2005 wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww Dear Mr. Abaya, The failure of Communism is moot and academic. You will have greater mileage for your pen if you will shift your pitch on what must be done by the Philippines to get out from the economic quagmire and catch up with its neighbors in the Asia-Pacific region. JMC Nepomuceno, [email protected] November 14, 2005 wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww Dear Mr. Abaya, You are absolutely correct in stating that wrong policy choices are largely responsible for dragging the Philippine economy down. Take the case of agriculture, where fertility and climactic conditions generally favor us. Even if we are considered an agricultural country, that term is only a label to signify that we are not yet in the industrial stage. However, we are not really an agricultural country in the sense that we are agriculturally productive. If we were, we would not only be producing enough food for our own needs, we would be exporting our excess production as well. But as it is, we are not even self-sufficient in our staple food, rice. And we have to import a large percentage of our other food requirements as well (wheat for our pandesal, meat for our karne norte, vienna sausages and Jollibee hamburgers, corn and soya meal for our hogs and poultry and, yes, even vegetables and concentrates for our salads, sauces, ketchups and juices). Unlike our Southeast Asian neighbors like Thailand and Malaysia, we only pay lip service to agriculture. In the 1950's and '60's, we were agriculturally superior to Thailand and Malaysia. We even had the best agricultural school in Southeast Asia in U.P. Los Ba�os, home of the Asian "Green Revolution", where the International Rice Research Institute was based. Thailand and Malaysia sent their agronomists to learn from Los Ba�os. And they profited more from Los Ba�os than we did. What went wrong with the Philippines? Why did Thailand and Malaysia become such strong agricultural economies and leave us behind? The answer is that Thailand and Malaysia developed long-term agricultural policies and stuck to them. They focused on productivity and infrastructure instead of being distracted by agrarian strife. They focused on crops they knew they could produce more efficiently, instead of being side-tracked by quarrelling over the Sugar Quota windfall or the Coconut Levy swindle. Thailand concentrated on rice, corn, tapioca, fruits, flowers and aquaculture. Malaysia concentrated on oil palm, rubber and cocoa. Because the proper infrastructures and facilities were in place (farm-to-market roads, certified planting material, water-impounding and irrigation facilities, credit facilities, post-harvest facilities, market mechanisms), farming became a viable enterprise and raised the income levels of the urban population. Now, Thailand is one of the world's largest exporters of rice, corn, tapioca, fruits, flowers and shrimps. Malaysia controls the world markets for lauric oils and rubber. Thailand produces rice, corn and most other agricultural products at significantly larger volumes, and much lower cost, than we do. They are globally competitive because they set up the infrastructure to make themselves more productive. Thailand has far outpaced us in agriculture and tourism, two sectors where we had built-in advantages. Because of proper planning and implementation, Thailand is enjoying the fruits of a booming economy. Due to research and improvements in planting material, Malaysia has been able to improve palm oil production, on a per hectare basis, almost tenfold since the 1970's. One hectare of oil palm produces up to 7 tons of palm oil per year. It's closest competitor, Philippine coconut oil, is produced at the rate of 1 ton of oil per hectare, per year (practically unchanged since the time of Magellan). Malaysia exports almost 10 million tons of palm oil annually, the biggest player in the world lauric oil market by far. The Philippines, which once controlled this market, now exports less than 1 million tons, thanks to senile and uncared-for coconut trees.. Malaysia also controls almost half of the world's rubber market. With high fossil fuel prices, these commodities are booming in world markets due to the bright prospects of biological fuels and the high cost of synthetic substitutes. And to think that, not too long ago, Malaysia was derided by Leftists in our academe and our media for being a "plantation economy". Agriculture provided Malaysia a big boost towards industrialization. Today, with a well-to-do rural population, Malaysia has its own internal market for industrial goods and finished products. It is well on it's way to NIC-hood. Agriculture, which once was the backbone of its economy, now only accounts for 12% of GNP. Now, who is having the last laugh? In the Philippines we were too short-sighted, mistaking the trees for the forest. First of all, we were too focused on primarily four crops, which were rice, corn, sugarcane and coconuts, all of which became heavily politicized. Rice and corn, being staples, were seen primarily as food for the masses. When rice and corn-producing areas became hotbeds of agrarian conflict, few investments were made on these lands and they became dependent on government projects for improvements to infrastructure and production. While yields in other countries soared, ours did not. Our fields and our agricultural practices became outdated. And, because government soon realized that rice and corn shortages were more politically explosive than concentrating on production, it became more politically expedient to import these staples. Sugarcane was hampered by the American sugar quota which gave Philippine sugar preference in the U.S. market. This created a sector that was characterized by political dependence, lethargy and lack of imagination. Sugarcane producers became complacent and focused on this single crop. When other countries began producing sugar at lower costs and U.S. subsidies were cut, sugarcane farmers were lost. A large segment of our agricultural sector was in limbo. Coconuts were easy to care for and to harvest, making for a reliable cash crop. But coconuts did not maximize the productivity of the land and were subject to volatile market conditions. More than 3 million hectares of what could have been more productive land were planted to this "lazy man's crop". Yet, instead of guiding the sector and helping it to diversify, Ferdinand Marcos and Danding Cojuangco made it into a convenient cash cow and bled it, imposing the multi-billion peso coconut levy whose proceeds are still under litigation. Secondly, we focused too much on land ownership. Had there been less focus on ownership, and more concentration on productivity and stewardship of the land, more production, jobs, and incomes would have been created in the countryside. The rural population would have been better off and there would have been less urban migration and crime. Agrarian conflict, incited by the Communist movement, killed private initiative. And demands for revolutionary taxes, coupled with harassment by the NPA, only discouraged further investment in agriculture. The lack of initiative caused the middle class gentry to abandon the countryside, while the ones left to till the soil had no know-how or capital to make farming productive. The Communists have a lot of "farmers" and "fishermen" at their beck and call, but these are more adept at staging mass actions, and issuing press releases, than at making farming or fishing more productive. Just like the politicians, Communists pay lip service to agriculture. But they do not have the interest of furthering agricultural productivity. They only have their political agenda in mind. But, having seen what happened in the Soviet Union, North Korea and Mao-era China, it comes as no surprise. Communism is such a bankrupt ideology that it cannot produce enough food for its own masses. Unfortunately, this short-sighted Communist focus on land ownership and class struggle influenced government to place the horse before the cart. For political expediency, and to appease the Leftists within her cabinet, Cory Aquino and her cabal of trapos enacted a land reform program before the proper infrastructures and facilities were in place. Not only was Cory's land reform program doomed even before it was implemented, it dragged down Philippine agriculture as well. Can we still save Philippine agriculture? The land is there, but there's a lot of work to be done in putting up the system and infrastructure in order to make farming a viable way of life. There's always hope, but do we have the political will to set narrow and vested interests aside? It is such a shame, because even the 1987 Constitution proudly proclaims that agricultural development will be the springboard to industrial development. We are so used to saying things we do not mean, that Lip Service is even enshrined in our Constitution. Carl Cid S.M. Inting, [email protected] Cebu City, November 14, 2005 wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww Dear Mr. Abaya : If indeed there is a Mr. Ferdinand Anno, perhaps you could point out to him, that the zeal and energy of true believers of the communist or even ultra leftist/socialist core line being mouthed by locals like him, may be better redirected to positive efforts instead of destructive activities (like the protest for protest sake of the trapos). Isn't it obvious to them that they are being taken for a ride by their alleged leaders who live in comfort in Holland while their foot soldiers make-do with the proverbial scraps from the table - but these scraps in reality are ill-afforded meager resources extorted from the poor rural people, the very ones whom they claim they want to "liberate" from poverty and oppression by the wealthy? Tony Elica�o, [email protected] November 14, 2005 wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww Mr Abaya is seeking a refuge that is not there. He must realise that he cannot ignore what�s local by going global. Locally, what he irresponsibly tags as �Communists� (irresponsibly as this labelling amounted to death warrants, and casualties continue to mount), the legal left formations like Bayan Muna, Gabriela, Partido Manggagawa, AnakPawis, Akbayan, etc. are �winning� and he�s not. (Just because they are legal fronts does not make them less communist. Joma Sison himself likened the CPP to a Warrior who uses both a Sword (the NPA) and a Shield (the fronts of the NDF) to wage revolution against the bourgeois state. When swung with sufficient force, a Shield can be as lethal as a Sword. ACA) There is one bond that connects Mr. Abaya to Norberto Gonzales and Alex Magno, and that is, their Failure to neutralise their Leftist nemesis� discourse and political advance. That�s why they resort to name-calling, because they�re failing. Mr. Abaya also said I�m either a Communist or pro-Communist. Doesn�t he realise the implications of that line? Is he handing me over for execution? Had he not heard of one Jovito Palparan on a prowl for �commies� prey? (By romanticising communist militants and gleefully awaiting their victory, you have labelled yourself pro-communist without any help from me. ACA) My only point in that comment I made was to give Edgar Jopson, Rudy Romano, Leima Fortu, Edison Lapuz, Lean Alejandro, Romy Sanchez, Filomena Asuncion, Macliing-Dulag a little respect. They may not share the vision of Mr Abaya and the grand designs of moneymen, but they sure know better the people in the ground and their needs. (Why should I show any respect for na�ve true believers who died believing and insisting that the Earth is flat, despite the evidence worldwide that the Earth is round? Pity, not respect, is what they deserve from me.. ACA) Na�ve view of human nature? I deeply believe in the creativity of the human. But are we going to confine human creativity within just the bounds of free market and the dynamic of consumption? Is that all that is there to human creativity, or to human nature? Is that not an all-too na�ve view of human nature? (No, that is not all there is to human creativity or human nature, since there is also art, music, philosophy, science, technology, etc. But since we are discussing economics, I can insist that the profit motive is the best incentive for economic activity, and denying it, as Marxist Socialism does, is a na�ve denial of human nature. It is up for you to disprove that by showing me ONE, just ONE, communist country that was/is an economic success while denying the profit motive. ACA) I can read that Mr. Abaya simply is at a dead end as Fukuyama of the �end of history� fame. There is simply no world to them beyond the boardroom of global moneymen and their political enforcers, and more philosophical apologists. To these moneymen and their small global circle humanization is all about a mass queuing for those �trickles�. To them, to complain when �trickles� are not coming is �na�ve�. (You never heard of co-operatives? They are enterprises �beyond the boardroom of global moneymen and their political enforcers.� Very popular and very successful in Western Europe. Not allowed in the Soviet Union until 1988, just before the SU collapsed, because of ideological concerns about �profit-making.� Do yourself a favor and educate yourself. ACA) But what amazes me no end is Mr. Abaya�s isolating the making of the Philippine crisis from the suddenly benevolent empires, when even these very empires� stewards themselves publicly acknowledge complicity [talk of their efforts to find ways to humanise their mode of wealth creation]. (The Philippine crisis is NOT isolated from the rest of the world. It just lingered here longer than in the rest of the world due to several reasons, among which is the stupidity of the complicit Philippine media in giving the communist movement more publicity than it deserved. In the other countries near us, communists and pro-communists were thrown in jail and left to rot there. Or worse. ACA) And how can Mr. Abaya liberally delete the global factor, or the cold war politics behind the then seeding of Taiwan and Hong Kong�s drive toward progress? How can one think that US companies were simply looking for cheaper labor, and that the US government suddenly turned apolitical and uninterested in China and the Communist advance at the suppose peak of its �domino-ing� of Asian realities. Either Mr. Abaya is na�ve or intellectually dishonest, or incapable of sensing historical deja vu. (You have a fertile imagination to attribute the choice by US companies of Hong Kong and Taiwan over the Philippines to US government efforts to change China into a capitalist country. What does your fertile imagination say was the reason the Philippines failed to adopt an export economy and failed to attract millions of tourists? The US government wanted to turn the Philippines into a communist country? ACA) Ferdinand Ammang Anno, [email protected] Union Theological Seminary Pala-pala, Dasmarinas, Cavite, November 14, 2005 wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww Hi Tony- Mr. Anno's response to you is clearly off base, both personally and substantively. It�s also pretty clear that the Philippines went wrong with import substitution rather than a manufacturing and processing export orientation.. And that the early minimum wage law reduced the country's competitive advantage. However, there is another crucial element to the story which you may not have thought about, and which allowed many of those other countries you mention to pay such low wages. And indeed it was Communist China that I think got it right first. That was early, serious, and successful land reform. China, followed by Taiwan and Korea, were able to offer both their home grown and foreign manufacturers lower wages than the Philippines because they quickly engaged in real and comprehensive land reform. This meant that rural families had a reasonable piece of land of their own on which they could grow at least their subsistence crops, perhaps some commercial crops as well, and build a house of their own. They did not have to give half their crops to a landlord, and most of the rest to a pre-harvest buyer. Nor did they need to pay rent. As funds and labor became available, they could sensibly add to their homes, and there were lots of basic consumption goods they did not need to purchase. And because lots of industries were decentralized to the rural areas, industrial workers in the family could live cheaply in their rural home. Thus while their wages were comparatively low in dollar terms, the basket of goods they could purchase with that money was substantial. At the same time it meant that manufacturers and processors could keep their wage bills down during the crucial initial years of building up their capital, markets, experience, and entrepreneurial and technical skills. It also meant enlarged domestic demand for somewhat more expensive processed (as opposed to imported) goods. Land reform in Taiwan and Japan were, of course, not done by communist governments. However, both regimes were almost certainly prompted to carry out their massive land reform programs in fear that if they did not do so, their own people would follow the Chinese route. Communist North (and now South) Vietnam also did massive land reform but its effects were of course hampered by the continuing wars. Malaysia, didn't push it quite so far, but did provide huge subsidies to the rural Malay population after the 1969 riots, with much the same effect. Even relatively landless Hong Kong and Singapore represent much the same principle. Neither had land to reform, but they did the next best thing: they provided nearly free public housing for masses of their people. Again, because their people paid nominal or no rent, their employers could reduce their wages by the usual 20-25% which normally goes to rent. Their workers could survive, still having a solid roof over their head, and could develop their skills on the job At the same time their employers could undercut their foreign competitors. Through the "danwei" system, the major cities in China did much the same thing. Thailand and Indonesia did not make these same kinds of quite so dramatic (and effective) moves and thus it is not surprising that while still ahead of the Philippines, they are towards the bottom of your exporting list. In all these case, if you compared not just dollar conversions, but purchasing power parity, workers in these other countries were better off than their "higher paid" Filipino counterparts. Land and housing (and often schools and medical services), were provided for free or close to free by the state so that even when paid lower dollar wages people could still have a relatively meaningful life and reasonable prospects. None, or very little of this happened in the Philippines - and I think it accounts for a great deal of the country's continuing malaise. It�s also possible that it links to your other concern; out-of-control population growth. There is at least anecdotal evidence that the lack of security from state sources encouraged people to have lots of kids, in the hope that at least one of them will somehow "make it," and support the rest of the family. In any event, I think a reasonable conclusion to this story is that serious land reform - a redistribution of productive assets, a basis for a family to build its assets, as well as a marker of social justice, and an indication that the state, the government, the elites, etc., have some real concern for the people and for development - can make a huge difference. And of course serious land reform has never/("hardly ever") happened and been sustained in the Philippines. You undoubtedly know the cases and the reasons for that better than I. But I do think it is one domain in which the Communists did indeed lead the way. David Szanton, [email protected] Durban, South Africa, November 15, 2005 MY REPLY. Very good point, David. In 1992, when presidential candidate Miriam Defensor-Santiago asked me to draft her program of government, I proposed, and she accepted, that her flagship program would be a massive program for low-cost housing for the poorest of the poor, to be built by student volunteers. The housing beneficiaries would then be organized into manufacturing co-operatives to produce items for which there is a real need and demand, starting with the elements that go into housing. (See my articles on housing in www.tapatt.org.) Unfortunately, she lost. Or she won, but she was cheated in the counting. As for land reform, I calculated, in 1992 when Miriam was secretary of agrarian reform, that if the total available arable land were divided into the total number of landless tenants, each one would get only about half a hectare. Not enough to sustain even one family for one year. I visited Taiwan in 1995 and was given a briefing by the land reform agency. I was told that the trend in Taiwan in 1995 was to consolidate small holdings into bigger farms because small farms were just not economical or competitive. In the light of that, it may be better to just give landless peasants the cash equivalent of half a hectare each and then organize them into manufacturing co-operatives. Most peasants are not really attached to farming; they were just born into that milieu and do not know any other. By the way, I do not belong to an hacienda-owning family. But we have to outgrow GMA�s ideological commitment to free trade and globalization. From the start of her presidency, GMA has deliberately downplayed the importance of manufacturing as job-generator, because this would conflict with the apparent assigned role of the Philippines as a service economy and an exporter of labor, rather than as a manufacturing center. But in a one-on-one with her in September 2001, I argued that a hectare of agricultural land cannot sustain even one family for one year. But if converted into a manufacturing center, that same hectare can sustain hundreds of families. Her reply was evasive: �The debate between agriculture and industry is a 19th century debate.� Or words to that effect.(See my article �GMA: the best there is, but�.�, also in www.tapatt.org) wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww Dear Mr. Abaya,I have no idea on how you got my e-mail address as your letters justpopped-up from my e-mails.At any rate, I do appreciate your doing so and for sharing with me your views regarding communism and your opinions of this "Inang bayan of ours." I am just an ordinary employee who is trying to earn an honest living. It pains me to know that once again, our "communists comrades" are again very active in this part of the country where I work. As a start, the Filipinos were confronted with the same problem - poverty. Only, we had different solutions. The communist chose to change the government, while the rest of us chose to work to earn a living. The communist chose to change the form of government through an armed struggle, while we chose to change thehearts of men through sharing the word of God. Today, after more than 30 years of the communist movement, we are still wallowing in poverty as a people, and those who chose the struggle are still in the mountains. For us, who chose to work, well, at least, we have improved economically from where we have started and with God's help, we will overcome these communists.God bless you! Clarence Martinez, [email protected] November 15, 2005 wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww I am certain it won�t be the last time just like when I was guest of Tina Monzon on Talk Back with Rep. Joey Salceda on the EVAT and the consumers reaction. I appreciate your viewpoint expressed on the opinion of the commie writer. Though I agree with your points which is quite plausible even from a non economist like me, it is my humble view that there are other factors which pulled down the Philippines. The present government manipulated and politically controlled justice system is peppered with corruption and bribery of the men in robes, from the (also government prosecutors) lower court to the chambers of the justices of the Supreme Court. Bribery has evolved as a matter of fact tradition. That is why I advocated a lifestyle checks of all prosecutors,judges and justices even in the Supreme Courts. Philippine justice is in reality justice for sale. There is absolutely no accountability as a result of the complacency and acceptance of the quality of justice delivered. Only the poor gets the long arm of the law. The rich and the powerful are above the law or immune from it since every one could be bought (even justices who read the bible every morning and meditate like me � a Dominican bred social democrat. For that matter, the Sandiganbayan and Ombudsman are very good organizational decorations, just like the CHR and the various electoral tribunal. They are all mere paper tigers. For many decades now, there is no accountability in the Philippines especially for the rich and the powerful politicians so we are all helpless mute witnesses to politicians' shameless plunder of public funds becomes an accepted tradition for those in allaspect of government bureaucracy and public service. We are in bottom pit in the region because of this. It is my view that the real culprit is traceable to the present government controlled system handed by the Americans when we earned our independence. The early so called pinoy statesmen then were Amen boys who accepted every system the colonizers gave them, not the system they enjoyed in their homeland � the Jury System. We were duped because they deprived us of the American Jury System where the public (even pinoy immigrants and blue collared workers) participate in jury duty). You don't have to be a lawyers or a bright individual to be a member of a jury. You must just be a district registered voter for both the Grand Jury and the Jury Trial which is fast and accurate, down to the very core of the factual evidences. No confusing of issues or technical dilatory tactics which is the hallmark of the fraudulent Philippine justice which last for decades and generations which remain unresolved. The Jury Justice System is the basic pillar of an authentic democracy. Without it democracy becomes a myth. Justice must be riveted on truth otherwise it is an impossible dream. In America the jury system works perfectly fine for many many decades. Actrually, I have prepared szince lat year, an enabling bill and submitted this to both Senators and Congressmen, the present leadership and the men in judiciary. They won�t touch it since it will remove their inherent immunity and power over the justice system because the prosecutors up to the justices of the Supreme Courts are political appointees, and owe their total loyalty and allegiance to these political power. The utang na loob literally make them vassals in the justice system. Gad willing, with the justice system shifting to the jury system, we can expect everyone to toe the line, the high and the mighty, small entrepreneurs ands multinational giants like Pepsi Cola (please visit www.pepsi349.com) which duped thousands of Filipinos and laughed it off despite losing its corporate respectability before the world (American are not that bright and smart after all), the Muslims will no longer separate as well as the reel secessionists would come down and join the main stream society because real justice after all will work . The present People's Court is actually the embryo of the American jury system. Its not a commie invention or model but it is actually the principal anchor of the greatest democracy in practice today - the United States. It is the formula which made the US great. I have prepared other strategies like a public referendum offered (or People's Initiative Law) within the present system. I hope you would discuss this in your column to stimulate reaction from all stakeholders . I am just too dense at the moment to remember the exact number of RA at this time - 4 AM. I have great faith in our country so I still come back to it as often as I could. .As a matter of fact we are building an emergency public hospital for the poor in a lot owned by Fil-Am PInoys. The hospital would have state of the art facilities, to be funded and sustained by a Fil-Am foundation where donations become US tax deductible. We intend to replicate this template in other remote poorest communities in the countryside. This is my pro bono work. No even a centavo goes to our pocket. Vic del Fierro Jr., [email protected] November 14, 2005. wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww Tony on TV (8) Oh please. The president was being mild. Philippine Media should stop smoking it's own dick. They are the reason for a lot of their own (and our) problems. The only people rushing out to defend the media right now is the media itself. Carlos Celdran, [email protected] November 12, 2005 wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww Hi Tony, I normally receive all my e-mail early in the morning so have missed your TV appearances up until last night when I happened to catch it by accident as your notice didn't reach me until this morning. I enjoyed your discourse and you look younger than what I thought you would be according to your picture in the papers. Keep up the good work and I appreciate being on your e-mailing list. Jack Gesner, [email protected] Baguio City, November 12, 2005 wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww Dear Tony---Listened to you on TV. It was very interesting. Showed your knowledgeability . Josie Lichauco, [email protected] November 13, 2005 wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww Dear Tony, I heard the interview. It occurred to me, isn't everybody jumping to conclusions when they conclude Garcillano disappeared to save GMA's skin? All he could have done however, if indeed he received theP300 million Micaelangelo Susi said he had seen being turned over to him by Bong Pineda, was deny he received any money from Pineda. After all, Susi's was only hearsay. What, however, if Bong handed over to him P300 million and he gave away only 2 or 3 millions of the 300 for GMA's men to tamper with the election returns and kept the bulk to himself? Then he'd have to disappear to save his own skin from the wrath of GMA. That's all conjecture, I admit, but so is conclusion that Garci's disappearance had been stage managed by GMA.. Nati Nuguid, [email protected] Germany, November 14, 2005 wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww |
| Dear Mr. Abaya: Even if we didn't have any minimum wage law, it won't make any difference. Our Constitution prohibits foreigners from owning more than 40 per cent of voting stock in corporations. This Constitutional limitation has been pointed out by many as one of the drawbacks in attracting foreign investment in our country. The 1971 Constitution continued the Constitutional policy of not allowing foreigners to owe more than 40 % of the voting stock in corporations and the 1987 Constitution included this also. I am glad now that President Arroyo has taken responsibility in asking Congres to amend the Constitution directly and not to rely on any Constitutional Convention to do this. The power to decide the levels of foreign equity participation in our country should be left to Congress. Ramon A. del Gallego, [email protected] November 26, 2005 MY REPLY. You are saying, in effect, that South Korea, Taiwan, Singapore, Malaysia, Thailand and Indonesia overtook us because they allowed foreigners to own more than 40% of the capital stock of domestic corporations. But you offered no evidence to support that contention OOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO |