Threats against Philippine economic recovery and growth

There are three threats to Philippine economic recovery and growth. First, the immaturity and backwardness of the Philippine political system. There is no continuity in terms of State policies. The implementation of policies depends on the whims and caprices of the sitting Power. This explains why, when a Policy opposed by a majority of the People is implemented, the next available option is an action leading to destabilization. Some sectors hold the idea that change can only happen if the present administration is abolished and replaced by one more sympathetic to their Cause.

Presently, there is no institution of governance in the Philippine State that has a stable policy platform. Every institution is built like a fiefdom, where the whims of the appointed or elected Head is the ultimate policy. Even in the Supreme Court, the legal decisions which define the laws of the land and jurisprudence, are now blurred and are threatened by newer views and opinions which were previously expressed, but now, attaining ascendancy due largely by political influence, not by Law.

Translate that to several other agencies of government below the Executive Office, and you will find that every agency has its own interpretation of the Law, due again, largely by the dictates of the appointed Power. There is no symmetry, no clear and dominant View, only opinions based either on political or business interests. Hence, transactions with these agencies remain personal, not professional. Those who are socially up there in the strata enjoy more privileges than those below. Credit that to the weak leadership being exercised by the Chief Power.

This holds true in Congress where we see transactional politics at its worst form. Instead of the dominant view that Legislators are accountable to their constituencies to work hard and dispense laws that benefit all, the more ascendant view is that legislators work for their own interests and for their stay in power. Hence, there is no clear continuity in terms of policies, no clear direction as to where the country is headed and no validation of majority views if these conform with existing needs or not.

The second threat to the Philippines is the continuing corruption in several government agencies, something which should have been addressed by this administration, but because of the involvement of close associates of the President, being largely ignored and glossed over. Smuggling is still a big issue. Red Tape has lessened but continues to affect investor and business perception.

The last threat to the Philippines is the continuing dissolution of the Opposition. The continued fragmentation of civil society is dangerous. What follows after fragmentation is the strengthening of the State and eventual exercise of its Powers to further violate civil liberties. This is most evident with the passage of the Cybercrime  law and the State's continuing opposition to the passage of the Freedom of Information bill.

In sum, yes, the Philippine State is slowly liberalizing itself economically, and continues to reap excellent results. However, the lack of improvement in the political sphere and the continuing fragmentation of a credible Oppositive force threatens the very growth of this country into Asia's powerhouse.

Yes, the goal is to transform the Philippines into an Open Democratic society. What we have achieved so far is the liberalization of the economy, not the institution of measures which would further democratize our institutions. The expectation is while the economy opens itself up, other institutions or levers of power also benefits from this by modernizing which is not being seen.

The contrary is being achieved---while we attain economic maturity, our other institutions within the State superstructure continue to lag behind and worse, either decaying or being killed by efforts of the State to further widen its Powers and further strengthen its hold over the citizenry.

While we, or some sectors claim to have achieved tremendous economic gains, the State is slowly building its strength and is slowly making measures for its preservation by culling civil liberties.

Answer to Ling Pao: Open Democracy or Seven Points in Re-Imagining the Philippines

"7 Points in Re-Imagining the Philippines"

I would like to answer Ling Pao's question with an essay. There are seven points to structural re-engineering.

First, a true recognition of what the concept of a "Filipino Nation" really means to all of us. Is this "Filipino Nation" only comprised of Malays or Austronesians? Or this Nation is a conglomerate of different races: Chinese, Japanese, Indians, Persians, Arabs, Malays, Thais and Western, all existing co-equally in Austronesian terms?

If we recognize that this Nation has, since its birth, been dominated by Chinese and Indian economic systems, adopted Islamic or Arabian political belief systems, and inculcated with Asian mainland cultural values, that is one step towards the right direction. There should be a re-examination of what this term the Filipino Nation truly is before we embark on the more serious structural re-engineering.

And granted that we already did, the second recognition should be that any other system, other than capitalism, will not genuinely prosper in this country. Why? Because from the very beginning of our History as a Nation, we have always seen and adopted free enterprise as our economic system.

Yes, there are structural imperfections brought about by this system, but these are mostly political by nature and hence, can be corrected politically.

The institutional imperfections of our system are organic features of the economic system that we adapted. However, we can modify this economic system to suit the political system we want. And that's the beauty of modern capitalism.

Modern capitalism thrives in all forms of political systems: be it republican, democratic, or undemocratic. We have seen how undemocratic systems were allowed to co-exist with other systems provided that the main thesis of capitalism: open markets are allowed to exist.

We all know that capitalism now exists side by side with socialism. Socialism is an economic theory but it is not an open and shut case. It can evolve and exists beautifully as a political theory rather than purely economic in the sense that man can mold it in whatever way possible based on his current needs.

Some may argue that both systems: capitalism and socialism are anathema to each other that they clash. I will not cite further examples here of how certain societies have successfully put together the fine features of Socialism with those of an existing capitalist system without getting into a serious mess.

China, for example, recognizes two economic models, both modifications of Socialist and capitalist thought: the Guangzhou model and Chongqing. Both models advocate free enterprise yet views political openness in contrasting styles.

Guangzhou model advocates for both economic and political liberalism while Chongqing is advocating the basic party line of conservatism preserved inspite of fast-tracked free enterprise.

In the case of the Philippines, we are still observing and studying what applies to a system like ours. We adopted American-style market economy while our laws are basically a mixture of Castilian and Anglo-Saxon precepts. Our laws are like a synthesis of Guangzhou and Chongqing in the sense that we tend to think liberally in certain things while being strict in others. This is good if we know or we have a sense of what is good and what is not good for us, in the first place.

Let us re-examine the past and recognize that these lands were once thriving free enterprise zones. There is no dominant economic hegemon, only political administrators who see to it that traders are allowed unhampered use of the lands and give the political powers the respect it deserves. In the first years of human habitation in these lands, no one claims to own them, except powerful families of old who rule not as economic dictators, but of administrators whose primary responsibilities are to keep the peace and observe the communal laws.

Third, we must recognize that the only viable political system for us is not Western models with its attendant problems, but Asian democratic.  I am not saying that we totally overhaul the political system because doing so at this point, is more destructive than beneficial.

What we need to do, as what we have done over the past few years, is enact legislation that is more attuned to our prevailing cultural norms and values and prune away old political concepts inculcated by us by our former Western colonial powers. It is time to strip away the thick layers of Western influence and try to see problems based on our own perspectives, rather than using Western lenses to solve Asian problems.

We are in the position to do this now because even if we don’t declare it before the world, our policies are becoming strictly nationalistic. That is why some governments argue with us, and even protest our ways because we mix political policies with economic ones. It is time to disengage politics with economics and just allow free enterprise and open markets to exist without overbearing them with politically sensitive policies.

Fourth, we must recognize that our social values differ from others, and these values should be institutionalized. We must start building a definite social value system that we will slowly inject into the State through the bureaucracy. The Bureaucracy should be the first laboratory for this.

Some may argue that we already have a Code of Conduct and Ethics for every singular profession in this country, so, what’s the use of another one? The problem with these codes is that they are unobservable, since the prescriptions there were made to address experiences of other nations or systems.  We must try to institutionalize what we in the corporate world term as “values stream”, definitive actions designed to achieve added value to a system, process or service. Example would be our concept of corruption or bribe. In the olden days, bribery is not morally wrong. It is given to speed up processes. In values stream analysis, we take away bribery as a concept entirely without giving morality as a basis for its extraction; rather as an ordinary course of business, we take away bribery and make it a fixture in the system but transforming it as an additional levy or tax. Those who want, say, speed up the delivery of their cargo, should pay extra to government. Those who don’t, well, they are levied the normal fees.

Fifth, we must recognize what our order of priorities is as a People. For us to determine what order this is, we must recognize that most of our problems are structural; therefore, solutions lie also on re-imagining structures. Graft and corruption, we say, is a structural problem. The solution is not piece-meal legislation or Executive action; but structural. How do we address this? First, change the penal provisions of laws punishing grafters. Second, change the penalties and punishments attendant to violations of the anti-graft code. Third, blind justice and effect the law against big-time corrupters and violators then admonish the small fries.

Sixth, we have laws and we must all follow them. Laws are useless concepts if society does not follow them. Laws are meant to keep the peace. However, if the law is being interpreted this way and that way and follows only the dictates and wiles, and whims of a definite class or clique in society, then, we must change those who interpret the law and even punish those who implement them without blinders. No one is unassailable or infallible in human 

institutions.

Lastly, we must recognize that we should continually evolve our institutions and our cultural value streams. We must recognize that as time goes on; our institutions must attain a higher level of goodness and achieve higher strata of development.  The ideal is, the more developed our institutions are, the lesser those structural imperfections become. 

Are we about to lose our democracy?

Are we about to lose democracy to a bunch of greedy misfits again? After living in a democracy for twenty three years, we are now on a verge of losing it again. Why?

Are we on the verge of another paradigm shift? Some of those in power desires for more power. While those without desires for more slavery.

Those who push for the restoration of despotism and elite domination all lived and thrived under the fascist dictatorship of Ferdinand Marcos. They tasted power back then. They were the first born of a dictatorship committed to the fascistic concept of domination. These people think its their birthright to lead the charge and restore the very monster we slain over twenty years ago.

I think of our situation as like that of Cory Aquino's. She's down with an illness, many considered fatal. She lost her appetite but trying to hold on. She and her family have all surrendered her fate to God.

Like Cory, our people have lost the appetite to fight and instead, have left it to God to determine their fates. Are we about to lose the very thing which Cory and a host of other patriots sacrificed their lives for? What did we do to deserve such a dishonor?

The very fact that, for the last couple of years, our situation got worst simply justifies some people re-imagining the model for governance. More and more people are believing that democracy is not for us and the right one is a system where we let the elites decide for us. That thing called parliamentary is actually elite domination in another form. In such a system, we just lost our right to decide for ourselves since we will all leave the decision-making to a bunch of rich kids.

Do we deserve this? No.

We deserve a better government. We deserve leaders that think and act with all respect for other people's rights. We deserve a system that rewards our good deeds and punish us when we commit bad deeds. We don't deserve a plutocracy or even an aristocracy, no.

We deserve democracy. For all its flaws, democracy remains the very aspiration of our forebears. It is therefore, our responsibility to preserve and defend democracy whenever it is being threatened by the forces of fascism.

A Call to Arms

Last night's session of the Lower House is more of a challenge for relevance rather than a provocative act to resolve what they think is a justiciable matter. The Lower House arrogated full legislative powers to spite the Senate and provoke it to show its relevance in the scheme of things. This is now, a power struggle, between a House composed of feudal lords with concrete constituencies with that of a House that has a conceptual national constituency.

Hence, this should not provoke another action that would involve the Supreme Court. No. Oppositors of this move should never involve the Supreme Court since this will be playing in the hands of those who planned this in the first place. If they file a case before the Court, that would complete the dastardly plan of these devils in barongs, infecting the High Tribunal and dragging it into the controversy.

If the High Tribunal is dragged, that would leave only the executive branch as a true power, and justifies more actions that aim to consolidate the full powers of the State into one institution.

It is critical for those who love democracy to meet this challenge by NOT RESORTING TO A LEGAL REMEDY. The Lower House challenged the Senate to prove its relevance by using an extra-constitutional route. Let the Senate do the same by marshalling the forces of change and seek remedy through a show of People Power.

Let me elucidate further

New AKBAYAN partylist Rep. Walden Bello is right. The passage of Resolution 1109 weakened the fine balance among the democratic institutions of governance in our country. By provoking what Rep. Luis Villafuerte called a constitutional question, the effects of it is worse than the intention. Why do I say that?

Because we now face a constitutional anomaly. And it is ill-timed and ill-advised to say the least.

At a time when we need political stability to insulate us from the ill-effects of a global recession, here we face these rampaging devils in barongs, creating a constitutional scandal, worst than those sex tapes of an infamous doctor maniac. These power-hungry cursed sonafabitches created a fine diversion for us to forget the damning graft scandals and led us to an uncertain future.

And did, they, even, succeeded in creating a justiciable issue? No. For a justiciable issue to occur, it must be very clear that the court can actually take jurisdictional cognizance of the same. If the court feels that it cannot offer such cognizance, then, it cannot be a justiciable matter.

The infirmities of Resolution 1109 are procedural and substantive, therefore, outside the scope of judicial determination. For example, the question of voting can actually be resolved by the Legislature themselves, seeing that the wording of the Constitutional provision on amendments and revisions is not infirm but firm in its spirit that the House votes separately, not jointly, and that this 3/4 vote is actually not joint, but separate voting. The letter of the Law is clear. And when the Law is clear, there should be no other construction than what the intent of the framers of that Law is.

What these devils did was create a controversy as a diversion, a bogey, so to speak, to allow their true intention to surface.

They're justifying their action by saying that all they did was to initiate debate and give the Court an opportunity to clarify what they think is a
fussy judicial issue.

There is no debate because the intent of the framers of the Constitution is very clear---no proposals for amendments nor revisions are to be entertained without the participation of the Senate.

What the Lower House did was a dictatorial move, a coup so to speak, that allowed them to arrogate full legislative powers for themselves. It is the first phase for a full shift into a parliamentary form of government. IN one fell swoop, they succeeded in diluting the substantiveness of the bicameral paradigm of governance and rendered the Senate as a useless, albeit, toothless tiger.

Last night's session was more of an exercise to resolve an itchy theoretical question, and that is, what would happen should one House arrogates full legislative powers inspite of the Senate? In a scenario like this, the Senate should exercise a realistic showing of its strength. And what is that?

The Senate should spearhead a movement that would force the Lower House to self-censure. It is not advisable that the Senate resort to filing a case before the Supreme Court. No.

This matter can be resolved by the Legislature itself. Senators and all those who love democracy should not fall into the trap set by the Lower House.

The Senate should show the world of its relevance as an institution by marshalling all the anti-charter change forces under its tutelage. It is now a question of who holds true power---those legislators with specific and concrete constituencies or those with a theoretical national constituency.

If the Senate fails to show power and strength, the Lower House will definitely proceed, opening the Charter and literally roughshodding everything.

That's why, this is a struggle for the preservation of democracy, of the things we so love and cherish and of the things we hold dear.

This is a fight, a challenge put forth by the demons of this regime against all those who love the Motherland. This is a time when we must, prove to all that we do have the strength to establish a society of Truth, Justice and Peace.

This is a veritable call to arms for those who love democracy.

Crush evil wherever and whenever necessary. It is our responsibility as Filipinos to stand up and face this monster with oure eyes open and our hands clenched.

The Filipino People is being challenged. Meet this challenge with bravery and fortitude of Spirit.

And call on the thousands of New Patriots and arm them with the Spirit of the Revolution.

Let these Patriots rise and defend the Motherland from these demonic rapists.

I also call on my colleagues over at the Open Democracy Foundation. Help us. Help the Filipino People. Let us marshall our forces and defeat these counter-democratic forces that threaten the very lives and futures of every Filipino.

Check out OpenDemocrat blogsite for 30 days

Check out my other blog: its at opendemocrat.rsfblog.org. You'll find something interesting there also. Open Democracy is something which I espouse right now. Having studied Marx, socialism, capitalism, philosophy and all the other "isms", I find Open Democracy principles to be a distillation of these pre-IT industrialized age that it's a concept that should be applied here in this country.

In a flat world like ours, Open Democracy aims to create open societies. What's the concept of being "open", check it out yourself. What I do like about this concept is its ability to marry the beneficial elements of global capitalism with the somewhat social effects of socialism. If you remember, Marx predicted the eventual state of Man beyond socialism, which others misinterpreted as Communism. If you re-study his writings, you'll find that Marx actually left the concept nebulous or not entirely clear. Why? Because, dialectical materialism presupposes that the future creation of man depends on the objective conditions of his environment. No one can really say what form of governance we will have in the future because that's precisely what dia-mat or Marxism aims to achieve. Ergo, based on current objective conditions, the elements of Open Democracy seems to reflect the direction the objective conditions would go in the future.

Soros hand in recent Philippine events

There was a surprising revelation that escaped everybody's attention during the ZTE hearings. I remember one senator (I think its Senator Enrile---just review the transcripts) asking Joey de Venecia who'll back him up financially in the NBN deal. Without batting an eyelash, Joey retorted the magic word: “Soros”.

Ah, Soros.

We all know who George Soros is. For those who don’t, three words to remember about him---Open Democracy (which I espouse), Asian Financial Crisis and Billionaire. He’s the Richard Branson of the financial world. Singaporean Prime Minister Lee Kuan Yew once blamed him for the Asian financial crisis. Malaysian Prime Minister Mahathir Mohammad once accused him of manipulating world markets for his own ends. I remembered FVR telling everybody that George Soros' hand was behind the spate of coups during the Cory Aquino regime.

Who's Soros?

Soros heads the Soros Management Fund, a global operation which essentially promotes open societies. You can check Google or the website http://www.soros.org or www.opendemocracy.net for more details.

Various sources describe him as a Financial speculator, a political activist and even a philosopher. He was once a student of Karl Popper, the philosopher credited of having created the concept of Open Democracy.

Actually, Soros pushes for Open Democracy. However, some sectors attribute sinister political motives behind every Soros' action. Soros hates despots. He was once a victim of fascism. He experienced it first hand when, as a young Hungarian Jew, he suffered first-hand atrocities under Hitler’s regime.

Soros’ stake in the Philippines

Soros is known to finance revolutions. He did it at EDSA. He did it for the Rose Revolution in Europe. For some societies, his participation proved to be crucial. Others, like his part in the repudiation of Bush re-election campaign, was a failure. His 80 billion dollar empire stretches “ in the farthest reaches, in the ends of the earth”, so to speak.

Why finance a revolution in the Philippines?

Obviously, current political reality dictates that changes in the present political structure is in order. The Arroyo administration is slowly becoming despotic. Former US President Bill Clinton’s remark about his former classmate as being “the most feared woman in the Philippines” tells you a lot about how Americans perceive Arroyo’s regime. Analyzing the Philippine situation, there are five (5) things that justifies a regime change.

1. The Arroyo administration’s militarization of the state. The Philippine state is a garrison state, ruled by a chosen few, chosen more for their subservience to the Arroyo clique than anything else. Just looking at the Cabinet and their underlings says much about this administration. Retired generals populate sensitive posts, appointed more on their capabilities at producing financial results to the Arroyo clique than anything. Undersecretaries are mostly business associates of the First Gentleman. Other posts, like the Supreme Court, the Ombusman and even the COMELEC have been given to puppets of the clique.

2. Tendencies in centralizing economic gains. The “improving” economic condition of the Philippines is not a miracle. Globalization has opened the doors of free trade to Asia-Pacific economies. Philippine economic fundamentals remain strong, buoyed by overseas remittances and strong foreign portfolio investments. However, the vertical growth of the economy has not resulted to horizontal development because economic gains failed to redound or spill over to sectors at the middle and bottom rungs of the economy. The reason is simple---a chosen few, the elites, have cornered most of the economic gains. The middle class—the prime motor of economic growth in other countries— remained stagnant. There is limited social movement in this class because of the concentration of wealth. Worst, large chunks of this class have fallen to the lower rungs of the economic strata. Pitifully, the proletarian class has likewise stagnated and remained slave consumers, powerless, and unable to progress to the higher stage of development. This concentration of wealth to a few breeds dissent from disfranchised sectors, creating an inevitable revolutionary situation.
3. Increasing human rights violations. Critics of this administration have suffered most of the brunt of human rights violations, perpetuated by state security agencies. As expected, the ruling oligarchs and their political allies will protect their economic wealth against the counter-elite. Those outside of the politico-economic circle of influence, will, undoubtedly, move to grab this concentrated wealth for themselves. Quite expectedly, force from the counter-elite (dubbed “destabilization” by the ruling elite) will also be met with equal or stronger force as a form of self-preservation or self-defense by the state’s ruling clique. Violations of basic rights are therefore, expected from this power struggle, with underlings suffering the most.
4. Contracting, instead of expanding. With continued destabilization, the state slowly closes its doors to counter-elites, forcing it to isolation. Isolation dictates that trust should only be given to subservient interest groups. Favors, will therefore be dispensed to those who pledge allegiance to the clique. The state in this situation contracts, and this contraction will also affect not only the political realm but also in the economic realm. This is quite evident in the ZTE deal. The administration gave the deal to the Chinese because it was supported by a strong financial ally (Razon) and a political wheeler-dealer (Abalos). Such situations can never be avoided under the current state of affairs. The weakness of this administration is exploitable because it is being forced to give in to economic favours to maintain status quo. The continued destabilization coming from a disfranchised counter-elite forces slowly weakens the state and thus, as a natural reaction, the state tries to gain strength by expanding its support bases, which, in this case, can only come from members of the economic community and the political operators.
5. Weakening state security. GMA’s decision to scrap the ZTE deal due to political noise tells you a lot about this administration. It has been decisively weakened. It has exposed its weakness by bowing to political pressure. Yes, this blogger encouraged GMA to stand down, because, following political strategy, that’s the most logical survival tactic available to her. The explosive nature of the controversy could force her ouster. However, her decision actually resulted to prolong her rule only for a few weeks or months, not years. The state’s weak state will affect not only her administration, but will definitely affect even the economy.

Indications of an impending regime change

1. Strengthening of the peso. Reports say that the peso will hit 40 or even 37 by year’s end. Is this good or is this bad? Obviously, it’s very bad. The peso’s comfortable exchange rate is around 40-41 pesos for a dollar. Some sectors are spreading the rumour that it could hit 37 or even 30 by 2008. This is bad because a strong peso will undoubtedly affect the export sector. You will have a situation where hundreds of small and medium sized export enterprises will be forced to close down because of this. You’ll have a situation where families relying on remittances will receive lesser amount of money than before. When you have a strong peso, you’ll be lessening the purchasing power of the middle class and the remittance-dependent lower classes, resulting to increased poverty. And, you’ll also find thousands of Filipinos out of work because hundreds of export companies will be forced to close shop. When you have that kind of situation, you are creating a replica of what happened in Argentina many years ago.
2. Demoralization among the soldiers’ ranks. The AFP admits this. Reports say, Esperon will file coup d’etat charges against six lieutenants. Note that those involved here are lieutenants, not colonels and definitely, not generals. This indicates a massive number of demoralized soldiers and when you have that kind of situation, you definitely have a serious issue at hand. Defeats in the Southern arena of war continues and GMA’s trusty military puppets will definitely have a hard time convincing troops to remain loyal.
3. Increasing dissent in the disfranchised sectors of society. The ZTE deal exposed a raw nerve in the Filipino psyche. It fueled hate. It fanned the flames of paninibugho (for a lack of an English translation, I wrote the Filipino term here---my apologies), a feeling more serious than the Western concept of hatred.
4. Losing political base. There’s a split in the ruling clique brought by the ZTE deal. Concessions were granted to other members of the clique to the consternation of other loyal subjects of the clique. This sprawn a division which could lead to ouster of the head of the clique. Far worst, this shows a permanent crack in the relationship, which obviously, was a patron-client one. The lost of a stable political base further led to a weakening, which, in this case, puts the regime in a serious state.

Soros knows this. Expect a heightening of tensions between inter-elites which could lead to an implosion. This implosion will fuel destabilization which will lead to disintegration of existing relationships and possible ouster from power possibly in the first quarter of next year. Or even earlier.