Friday, August 29, 2014

The Lipa declaration: An urgent call for national transformation



August 27, 2014 11:47 pm
Adopted on August 27, 2014 by groups demanding the resignation of President Benigno Aquino 3rd.
We are Filipino citizens of different personal, professional social and economic backgrounds and political persuasions and religious beliefs. We have gathered here in Lipa City on this 27th day of August A.D. 2014/ 2nd day of DHU AL-QA’DA A.H. 1435, under the auspices of the National Transformation Council, to reaffirm our deeply held convictions and beliefs about the common good and our highest national interests, in the face of the most pressing challenges.
We invite all our compatriots everywhere to reaffirm with us the same convictions and beliefs.
We believe that:
A crisis of unprecedented proportions has befallen our nation. The life of the nation is in grave peril from the very political forces that are primarily ordained to protect, promote and advance its well-being, but which are aggressively undermining its moral, religious, social, cultural, constitutional and legal foundations;
Unbridled and unpunished corruption and widespread misuse of political and economic power in all layers of society have not only destroyed our common conception of right and wrong, good and bad, just and unjust, legal and illegal, but also put our people, especially the poor, at the mercy of those who have the power to dictate the course and conduct of our development for their own selfish ends;
Far from preserving and defending the constitution, as he swore to do when he assumed office, the incumbent President Benigno Simeon Aquino has subverted and violated it by corrupting Congress, intimidating the judiciary, taking over the treasury, manipulating the automated voting system, and perverting the constitutional impeachment process; President Benigno Simeon Aquino 3rd has also damaged the moral fabric of Philippine Society by bribing members of Congress not only to impeach and remove a sitting Supreme Court Chief Justice but also to enact a law which disrespects the right to life of human being at the earliest and most vulnerable stages of their lives, in defiance not only of the constitution but above all of the moral law, the customs, culture, and consciences of Filipinos.
Therefore, faithful to the objective moral law and to the universally honored constitutional principle that sovereignty resides in the people and all government authority emanates from them, we declare that President Benigno Simeon Aquino 3rd has lost the moral right to lead the nation, and had become a danger to the Philippine Democratic and Republican state and to the peace, freedom, security and moral and spiritual well-being of the Filipino people.
We further declare that we have lost all trust and confidence in President Benigno Simeon Aquino 3rd, and we call upon him to immediately relinquish his position.
And we call upon the National Transformation Council, (Hereafter the council), to assume the urgent and necessary task of restoring our damaged political institutions to their original status and form before we begin to consider electing a new government under normal political conditions.
The role of the council will not be to succeed President Aquino, but solely to prevent the total destruction of our political system, and to rebuild and nourish its institutions back to health so that all those interested could join the political competition later, without the dice being loaded in anyone’s favor.
Like a crew whose task is to put everything in order before a commercial carrier, which had earlier developed some problems in midair, is cleared again for takeoff, the council’s duty will be only to repair the battered tripartite system and to make sure that the people are once again able to freely and intelligently elect their own leaders.
In this connection, we welcome the council’s proposal to open broad public consultations on the need to modify and strengthen the presidential system or to shift from the Unitary / Presidential system to a federal / Parliamentary System, endowing such structure with:
A totally independent judicial department, free from any kind of intimidation or bullying by either the Executive or the Legislative Department, and with the sufficient wherewithal to clear the backlog of the courts and fast-track all cases;
A merit-driven, professional civil and military service;
Totally transparent government budgeting, procurement, disbursement, accounting and auditing systems and procedures; and
An irreproachably independent and completely dependable electoral system, free from the virus that has corrupted the Automated Voting System Since 2010.
Whatever the final form of government the citizenry decide to adopt, absolutely indispensable are the integrity and independence of the courts, and the existence of an incorrupt electoral system by means of which we, the people, are able to freely and intelligently choose our own leaders in free and honest elections. Without these, we cannot speak of a normally functioning democratic and thus we fully support the council’s position that until we have such a fraud-free electoral system, we should refrain from holding any farcical election. But once we have it, we should encourage the best qualified men and women in the country to participate in the open electoral process so that together, we could put an end to the stranglehold exercised by the corrupt and incompetent political dynasties upon our elections.
Finally, we support the council’s proposal that with political reform there must go hand in hand comprehensive economic reform. With one strong voice, we must now say a vigorous “NO,” as Pope Francis has suggested, to an economics of exclusion and inequality, coming from a misguided vision of the human being and of society harmfully acted upon through myopic laws, policies and programs.
As the council prepares to embark upon the necessary reforms, we call upon the Armed Forces of the Philippines, as the constitutional “protector of the people and the state,” to extend its protective shield to the council, and not to allow any armed group to sow violence, disorder or discord into its peaceful ranks.
Adopted in Lipa City, this 27th day of August A.D. 2014 / 2nd day of DHU AL-QA’DA A.H. 1435.

Wednesday, August 27, 2014

Costly mistakes in our nation-building



Costly mistakes in our nation-building

Big mistakes in nation-building arise out of unwise decisions. Small mistakes that serially get repeated are big mistakes.
I have often dealt with such mistakes in my discussions of policy reforms. Today I will be blunt and talk of them as bad decisions. They cost our nation a great deal of distress and pain. They deter and alter for the worse our march toward economic and social progress.
Reasons for mistakes.” In general, there are three dominating reasons that explain how a mistake is committed: a bad decision could be the result of (a) wrong reasoning; (b) incompetence; and (c) emotions arising from self-righteous indignation.
It is possible that all three contribute to the making of a bad decision. This convergence would not happen all the time.
Yet, a nation’s political system should be able to insulate the leaders from making such terrible mistakes. In our young democracy, the absence of feedback on the errors that we commit in nation-building, the weakness of the country’s economic and political institutions, the lack of sufficient debate on important issues, and the cult of personality contribute to the failure to make sound decisions that help promote the common good.
Let us draw up a list of these mistakes and discuss why they have proven costly to the nation.
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Restrictive economic provisions in the Constitution concerning foreign investments.” I have put this problem as the most costly blunder in our nation-building. I did write about it about two years ago, and the essay is reproduced in my book, Weighing In on the Philippine Economy and Social Progress (Anvil, 2013, pp. 186-7).
Large economic and political interests benefit from mistaken policies, for they acquire more power from the benefits that they derive. Hence, any moves to rectify mistaken policies could be thwarted by these interests. This is one reason why it is difficult to change the said constitutional provisions.
For a while, there was a strong move in Congress to undertake a reform of these economic provisions through “charter change” (cha-cha). This economic cha cha, however, is now under some jeopardy.
The recent indication that the president now is partial toward seeking a second term of office requires cha-cha to amend the political provisions on term limits. This development inevitably snarls us back to the political cha-cha as the trade-off toward getting an economic cha-cha.
Thus, the reform on economic provisions is held hostage again to political developments.
No to nuclear power.” The decision to scuttle the nuclear power project was the result of self-righteous outrage of the new president. Cory Aquino associated the nuclear power project with corruption. And the object of hate was Marcos.
The nuclear power project cost the nation some US$1.2 biliion dollars at its cost then. It was thought to be over-priced and large commissions had changed hands. To demonstrate moral outrage, the project was discontinued. The cost of the decision impoverished the nation in several respects.
For one thing, the investment was associated with foreign debts incurred to finance it. Eventually, these debts had to be paid out of the nation’s coffers. That decision burdened us with enormous debts without a single ounce of new productivity (no electrical output).
Hence, it reduced the nation’s capacity to service its debt from this act alone! It also plunged the nation into a power crisis over a prolonged period, the nation’s economic inefficiency rose.
The economic loss from this mistaken decision is a large multiple of the cost of the project. There was economic loss from this mistake in terms of year-to-year output (or GDP) forgone.
Then compare it to the investment already made. It was stopped when it was ready to be commissioned for service! Therefore, it was almost ready to go. The economic loss to us was certainly a grand multiple of the investment cost.
The investment cost to us was real. It was sunk investment. By Cory Aquino’s decision, we had to continue servicing the loans incurred in the project and swallow the other expended construction costs as lost
Yes, other reasons could have provoked the decision – safety, cost, Three Mile Island, Chernobyl. Other countries with nuclear power projects knew better. They tightened their safety requirements (as we did.) The wrong calculus of welfare for the nation was used.
What have we got to show, because of the Cory Aquino decision? It’s not only the empty shell of a wasted investment in the power structure that lies today in Bataan. We got the 1990s energy shortages that cost the nation a lot of foregone industrial progress. In part because of high power costs, many foreign investments have gone to tour neighbors in Southeast Asia.
Moreover, we wasted practically the whole six-year term of a very able president, Fidel Ramos, who spent most of his time repairing the damage left behind by the energy deficiencies that the country suffered. Because he had to cure the problem in the shortest possible time, he got us into fairly high cost contracts for generated electricity that was made available to the nation.
“Our nuclear neighbors.” At the start of the nuclear power project, we were alongside major countries that embraced nuclear power as a source of electricity at the time. In our region, South Korea, Taiwan and Japan initiated their nuclear power projects after the energy crisis during this period.
It brought to their industries higher technological sophistication. Their manpower complement in engineering and scientific capacity rose toward a new level.
Today, China is on a high course of nuclear power development along with other energy projects. The dogged determination of Iran, a country with enormous supply of petroleum and gas resources, to have a nuclear industry can be gauged in part by the leap in technology that this industry would bring to this nation.
If only Cory Aquino did not make the mistake concerning the nuclear power project in 1987, we would be dependent on nuclear power on a broader scale today, like Taiwan and South Korea, now two very highly developed countries, whose growth paralleled ours during the early post-war years.
Possibly too, we might have followed a different path toward progress. Such experience could have also induced us to become much more competitive economy.
My email is: gpsicat@gmail.com. Visit this site for more information, feedback and commentary:http://econ.upd.edu.ph/gpsicat/

Tuesday, February 18, 2014

"When injustice becomes law, resistance becomes duty." 

Thomas Jefferson

Saturday, December 21, 2013

It's all about Competition


http://correctphilippines.org/competition/

It’s all about Competition

Posted on January 28, 2012
by Orion Perez Dumdum

Competition forces you to shape up, or ship out!
It is well-known that the concept of healthy and fair competition has the effect of an “invisible hand” that essentially results in benefits and improvements for everyone.
We CoRRECTors and other advocates of Constitutional Reform do not subscribe to the idea that human beings have to be saints so that things will get better. Humans are fallible and make mistakes. Instead, it is clear that when people have to compete, that’s when people improve: because competition forces people to shape up or ship out. Whenever there is healthy competition, unscrupulous behavior ensures that one’s competitors will eventually win. When there is competition, lousy service and lousy products lose out as consumers prefer to buy the better products & services.
CoRRECT™ – Constitutional Reform & Rectification for Economic Competitiveness & Transformation is really all about Competition, Competitiveness, Competence, and Choice.
Let us review the Three Point Agenda:

Companies compete against other Companies for Employees
With economic liberalization, we allow more investors into the economy, whether they be foreign or local. It is very possible to have local players comprised of talented local Filipino technology gurus (who unfortunately do not have their own cash) who are supported and funded by foreign venture capitalists’ seed money.
We will have more foreign investors and foreign companies coming in – instead of having to send Filipinos abroad to work for foreign companies in foreign lands – so that Filipinos can earn and learn (foreign multinationals often have good skills and personnel training programs) while being with their families, and not needing to work as migrant workers and OFW’s abroad.
With more economic players, there is more competition. Companies will compete against each other and will thus be forced to provide better goods and better services to the end consumer. Simple Law of Supply and Demand: Companies will be forced to compete against each other in hiring the best employees, dangling higher wages or benefits just to attract applicants to choose to work for them and not for a competitor.

Filipino workers will see that more jobs also means higher wages, with the highest wages going to the most competitive, skilled, and hardworking workers. Many workers will thus seek to improve themselves and compete against others, by learning new skills, and making themselves more attractive to employers in order to command higher wages.
Compare a situation that has an abundance of competition versus a situation that has a lack of it.
Without competition, you end up with lethargy & laziness. You end up with Despair. People feel resigned to the fact that no matter what they do, they’ll continue to earn low wages and they can’t find alternatives. And when they try to go into business, they also realize they don’t have much capital to begin with (and with the 60/40 constitutional provisions, generous foreign venture capitalists and angel investors are nowhere to be found) and even if they do, they may find that while there are many people, only a few have jobs that pay them enough to allow them to afford whatever it is they’re selling.
Clearly, competition is better. Economic Liberalization ensures competition, and economic competition improves our economic lives as wages improve.
The Philippines’ OFW problem is really nothing but a serious manifestation of the obvious lack of competition in the economy and lack of companies and jobs, forcing Filipinos overseas either as overseas workers, or as full-fledged emigrants.

When jobs are scarce in a country, people are forced to look for jobs overseas.




2) Region-based Decentralization (Evolving Federalism) 

Regions Competing Against Other Regions in attracting Investors
With Region-based Decentralization, the regions will be empowered to make their own economic and business-related decisions so that they themselves can decide how they want to attract investors to come over and set up companies in the regions.
Instead of a centralized unitary single monolithic entity such as Imperial Manila, we end up with empowered autonomous Regions who can compete with each other in trying to best attract investors and businesses. Whether it be by providing lower taxes or creating better policies, or it could even be by simply improving the efficiency of their own regional bureaucracies, the simple point here is that by making the empowered Regions compete with each other, they are forced to improve themselves in order to attract economic opportunities and businesses because in turn, the more businesses go to regions, the higher their revenues, the better the region’s infrastructure, and the more respectable the region’s leaders become.

If certain regions succeed in making themselves richer by successfully attracting so many investors and multinational companies as well as national companies originally headquartered in Manila, since they are autonomized and empowered to keep a bigger share of the tax revenue that they collect and are also empowered to make their own regional decisions, they may even decide to raise the salaries of their own government employees and leaders, thus making it unnecessary to resort to graft and scraping little kickbacks just to decently raise families. Regions will compete against each other and thus try to lessen their inefficiencies, lessen corruption, lower taxes, improve infrastructure, etc.
Competition clearly improves things, not just in a corporation versus corporation type of competition but also in a region versus region type of competition.

Parties competing against other parties to provide better results
In the current Presidential System, there is no real competition based on competence and platform. Instead, the competition is based on name-recall and popularity: both of which are irrelevant when it comes to delivering results.
But in a Parliamentary System, real competition that makes sense happens.
It’s a competition of Party versus Party (as opposed to personality versus personality).

In parliamentary systems, there is intra-party competition where the best members move up to the top, the best one becoming party leader. Parties also compete against each other on the basis of platform and performance
Notice also that in Parliamentary Systems, party leaders (who are in the running to become Prime Minister if their respective parties win majority of all seats or if their parties form coalitions where they have the most seats within the coalition) campaign using the pronoun “We.” They speak more collectively about their party’s platforms and their party’s past performance by always referring to “Our Party” or “My Party” unlike in Presidential Systems where presidential candidates use the pronoun “I” all the time.
Parties will be forced to compete against other parties by presenting their platforms to the public and showing that their platforms are more responsive to the needs of the people. More importantly, parties will be forced to compete against each other by choosing the best members among themselves to be the senior members of the party, the best of whom will be the party leader.
In a Parliamentary System, unlike in a presidential system, the Prime Minister and his majority bloc are always in competition against the Leader of the Opposition and his minority bloc. Active Debates ensue. The Leader of the Opposition tries to show that the Prime Minister does not know what he is talking about. The Prime Minister, on the other hand, must always be on his toes to show that indeed, he does know what he is talking about and has the facts to prove his point…
In a parliamentary system, there is an intense system of competition where the Majority’s “Government Cabinet” is always being challenged by the Minority’s “Shadow Cabinet.”

In a Parliamentary System, the competition between the Opposition versus Government during parliamentary debates ensures that the Government is on its toes
The Minister of Finance from the Government Majority is always on his toes and must always prove himself as the Shadow Minister from the Opposition Minority always challenges him and questions his decisions. In fact, since every single decision that the Minister of Finance makes within the Ministry of Finance regarding budget and other concerns is always done in the presence of the Opposition Shadow Minister of Finance, everything is above board, everything is transparent.

In a Parliamentary System, the Majority Government faces off in a highly competitive confrontational seating arrangement against the Minority Opposition
In fact, even the seating lay-out of a Parliamentary System (particularly the Westminster and Spanish systems) force the Majority and the Minority to face-off against each other in a face-to-face debate. The Government side sits on one side of the parliament hall directly facing the Opposition who are on the other side. Compare that with the Philippine legislative chambers’ seating lay-outs where all members of the House of Representatives and even the Senate all face the front where the presiding officer (Senate President or Speaker of the House) is seated.
There is no real sense of “competition” between the two sides. As such, this obvious issue of the physical seating lay-out in the legislature is also why there is a very poorly-developed sense of party cohesion in the Philippine setting. If the Philippines shifted over to a Parliamentary System where the seating lay-out features direct face-to-face confrontation between Majority versus Minority, this institutionalized competition between both sides will actually force the development of an improved party system: It will force parties with similar philosophies and platforms to coalesce or merge and prevent the proliferation of too many fractured mini-parties, while it will cause parties with very different ideas to become distinct as far as their platforms and policy proposals in concerned.
Most of all, forcing Majority and Minority to face-off in debates as a result of such a seating layout fosters the kind of greater competition that results in higher transparency and lower corruption.
In such a system, you don’t need to hope and pray that your government’s leaders are extremely honest people. Instead, the competition between the Minority Opposition and the Majority Government keeps them honest, as the Minority-Opposition essentially keeps close watch over the Government’s dealings and decisions. The Majority-Government, on the other hand, will try its best to ensure that it is able to deliver on its promises and thus enable it to gain the trust and confidence of the voting public for the next general elections.
In the presidential system, the decisions made by presidents and their cabinets often tend to be done behind closed doors, without any observation or scrutiny unlike in a Parliamentary System where the intense competition between Majority Government and Minority Opposition blocs forces the opposition to scrutinize the Government in the minutest detail.
Knowing this, it is thus no wonder that countries using parliamentary systems dominate the top ranks of Transparency International’s CPI listing (Corruption Perceptions Index) of the Least Corrupt Countries of the world, while presidentialist countries (and semi-presidentialists and dictatorships) dominate the bottom tiers.

In a Parliamentary System, there is Competition everywhere. There is Competition among parties and competition within parties.
Among parties, the parties try to outdo each other by executing policies better and producing better results than their opponents, and presenting better planned projects, better planned policies, and better platforms and manifestos to the general public.
Within parties, party members compete against each other to show who embodies the party’s principles and who is worthy to move up the ranks and eventually take on important roles within the party and within government in case the party wins a majority and forms the government.

A lousy debater who cannot articulate his thoughts properly, cannot think on his toes, has poor knowledge of history, poor knowledge of geopolitics, poor knowledge of policy, poor knowledge of economics, etc can never rise up the ranks in a parliamentary system. In a parliamentary system, the higher you go, the more exposed you will be to heated debates and intense scrutiny by the opposing side.
Not everyone in a party can do this. And certainly, because of this, not everyone aspires to become a party leader (and therefore only a select few ever really aspire to become Prime Minister).
Becoming a Prime Minister, a deputy prime minister, a minister, or some other senior member is clearly not for the faint-hearted and especially not for the weak-minded. To be a Prime Minister, you must be better at debates than your own party mates. You must be the “go-to-guy” or “go-to-gal” that everyone relies on when there is a difficult question. You must know all the relevant facts and figures in order to support your statements and often, you will not have notes or teleprompters helping you out when you extemporaneously respond to questions during debates and Question Time. There is no such thing as “Teka muna, tanungin ko muna advisers ko” in parliamentary debates.
The parliamentary system is all about healthy competition. It’s the kind of competition within parties that ensures that the best and most competent member in a party becomes its leader.
Competition between Minority bloc versus Majority bloc ensures that Corruption is kept very low as scrutiny of government is very intense.
Competition between Parties ensures that parties come up with solid platforms and solid plans of action.
Clearly, competition forces the best in everyone in a parliamentary system.
Sadly, the Philippines is presidential, that’s why we continue to be mired in mediocrity.