Tuesday, March 14, 2006

Transnationals versus Mass Education for Democracy

Democracy and Education
Noam Chomsky,Mellon Lecture, Loyola University, Chicago

Noam Chomsky, long-time political activist, writer and professor of linguistics at MIT, is the author of numerous books and articles on U.S. foreign policy, international affairs and human rights. Among his many books are
Year 501, Keeping the Rabble in Line and World Orders, Old and New.

WHAT WE FILIPINOS SHOULD KNOW : Beginning with his Dictatorship, Ferdinand Marcos implemented the dictates and plans of the International Monetary Fund/World Bank/Asian Development Bank (IMF/WB/ADB) as to the direction of our public school system (PSS) and/or national educational system as a whole; that is, to provide apolitical, cheap and trained labor to transnationals (TNCs).

Stressing only technical professions/vocations, though practical since they put food on the table, will only lead to the dumbing of the new generations of Filipino minds; to failure in developing critical thinking, especially as it applies to socioeconomic and political issues; thus unable to comprehend their misery which in turn lead to perpetuation of the present socio-economic and political predicaments.

The new generations of Filipinos, who were just growing up and/or born during and after the Dictatorship, are therefore more prone to losing and lacking in social consciousness, feeling of national unity, national dignity and sovereignty, in short, sense of nationalism; and instead are trained and conditioned to become more selfish and individualistic (which we already are for a variety of reasons) oblivious of his society, his community.

Any concerned, thinking Filipino today can perceive this greater lack of and/or absence of nationalism; an absence sometimes replaced with hostility to such attitude or sentiment (a few even proudly proclaiming their being "internationalists," which I find amusing), especially among us so-called educated in present society.

Hereunder is a greatly perceptive discussion by Noam Chomsky on the ideas of democracy and education, on what they should be about; and how corporate capitalism really see and do about these ideas......

(please see also:
http://thefilipinomind.blogspot.com/2005/12/dumbing-down-audience-by-ralph-nader.html )

"What luck for rulers that men do not think" - Adolf Hitler

“EDUCATION is a better safeguard of liberty than a standing army.” - Edward Everett, 1794-1865, American Statesman, Scholar

“According to this conception, the sole function of EDUCATION was to open the way to thinking and knowing, and the school, as the outstanding organ for the people's EDUCATION, must serve that end exclusively.” - Albert Einstein, 1879-1955, German-born American Physicist

“On the EDUCATION of the people of this country the fate of the country depends.” - Benjamin Disraeli, 1804-1881, British Statesman, Prime Minister

"The selfish spirit of commerce knows no country, and feels no passion or principle but that of gain" - Thomas Jefferson, 1809

Democracy and Education

The topic that was suggested, which I'm very happy to talk about, is "Democracy and Education." The phrase democracy and education immediately brings to mind the life and work and thought of one of the outstanding thinkers of the past century, John Dewey, who devoted the greater part of his life and his thought to this array of issues. I guess I should confess a special interest. It just happened that this was for various reasons, his thought was a strong influence on me in my formative years -- in fact, from about age two on, for a variety of reasons that I won't go into but are real.

For much of his life, later he was more skeptical, Dewey seems to have felt that reforms in early education could be in themselves a major lever of social change. They could lead the way to a more just and free society, a society in which in his words, "The ultimate aim of production is not production of goods, but the production of free human beings associated with one another on terms of equality." This basic commitment, which runs through all of Dewey's work and thought, is profoundly at odds with the two leading currents of modern social intellectual life, one, strong in his day -- he was writing in the 1920s and 1930s about these things -- is associated with the command economies in Eastern Europe in that day, the systems created by Lenin and Trotsky and turned into an even greater monstrosity by Stalin. The other, the state capitalist industrial society being constructed in the U.S. and much of the West, with the effective rule of private power.

These two systems are actually similar in fundamental ways, including ideologically. Both were, and one of them remains, deeply authoritarian in fundamental commitment, and both were very sharply and dramatically opposed to another tradition, the left libertarian tradition, with roots in Enlightenment values, a tradition that included progressive liberals of the John Dewey variety, independent socialists like Bertrand Russell, the leading elements of the Marxist mainstream, mostly anti-Bolshevik, and of course libertarian socialists of various anarchist movements, not to speak of major parts of the labour movement and other popular sectors.This independent left, of which Dewey was a part, has strong roots in classical liberalism. It grows right out of it, in my opinion, and it stands in sharp opposition to the absolutist currents of state capitalist and state socialist institutions and thought, including the rather extreme form of absolutism that's now called conservative in the U.S., terminology that would have amused Orwell and would have caused any genuine conservative to turn over in his grave, if you could find one.

I need not stress that this picture is not the conventional one, to put it rather mildly, but I think it does have one merit, at least, namely the merit of accuracy. I'll try to explain why. Let me return to one of Dewey's central themes, that the ultimate aim of production is not production of goods but the production of free human beings associated with one another on terms of equality. That includes, of course, education, which was a prime concern of his. The goal of education, to shift over to Bertrand Russell, is "to give a sense of the value of things other than domination, to help create wise citizens of a free community, to encourage a combination of citizenship with liberty, individual creativeness, which means that we regard a child as a gardener regards a young tree, as something with an intrinsic nature which will develop into an admirable form given proper soil and air and light." In fact, much as they disagreed on many other things, as they did, Dewey and Russell were perhaps the two leading thinkers of the twentieth century in the West, in my opinion.

They did agree on what Russell called this humanistic conception, with its roots in the Enlightenment, the idea that education is not to be viewed as something like filling a vessel with water, but rather assisting a flower to grow in its own way. It's an eighteenth-century view which they revived, in other words providing the circumstances in which the normal creative patterns will flourish. Dewey and Russell also shared the understanding that these leading ideas of the Enlightenment and classical liberalism had a revolutionary character, and they retained it right at the time they were writing, in the early half of this century. If implemented, these ideas could produce free human beings whose values were not accumulation and domination but rather free association on terms of equality and sharing and cooperation, participating on equal terms to achieve common goals which were democratically conceived.

There was only contempt for what Adam Smith called the "vile maxim of the masters of mankind, all for ourselves, and nothing for other people." The guiding principle that nowadays we're taught to admire and revere as traditional values have eroded under unremitting attack, the so-called conservatives leading the onslaught in recent decades. It's worth taking time to notice how sharp and dramatic is the clash of values between on the one hand the humanistic conception that runs from the Enlightenment up to leading twentieth century figures like Russell and Dewey and on the other hand the prevailing doctrines of today, the doctrines that were denounced by Adam Smith as the "vile maxim" and also denounced by the lively and vibrant working class press of a century ago, which condemned what it called the "new spirit of the age, gain wealth, forgetting all but self." Smith's vile maxim. It's from 1850 or so, from the working class press in the U.S.

It's quite remarkable to trace the evolution of values from a pre-capitalist thinker like Adam Smith, with his stress on sympathy and the goal of perfect equality and the basic human right to creative work, to contrast that and move on to the present to those who laud the new spirit of the age, sometimes rather shamelessly invoking Adam Smith's name. For example, Nobel Prize winning economist James Buchanan, who writes that "what each person seeks in an ideal situation is mastery over a world of slaves." That's what you seek, in case you hadn't noticed. Something that an Adam Smith would have regarded as simply pathological. The best book I know of on Adam Smith's actual thought (Adam Smith and His Legacy From Capitalism) is written by a professor here at Loyola, Patricia Werhane. That's Adam Smith's actual views. Of course, it's always best to read the original. One of the most dramatic illustrations of this new spirit of the age and its values is the commentary that's now in the press on the difficulties we face in uplifting the people of Eastern Europe. As you know, we're now extending to them, our new beneficiaries, the loving care that we've lavished on our wards elsewhere in Latin America and the Philippines and so on; with the consequences that are dramatically clear and consistent in these horror chambers but also are miraculously free of any lessons about who we are and what we do. One might ask why.

In any event, we are now proceeding to uplift the people liberated from communism as we've in the past liberated Haitians and Brazilians and Guatemalans and Filipinos and Native Americans and African slaves and so on.The New York Times is currently running an interesting series of articles on these different problems. They give some interesting insight into the prevailing values. There was an article on East Germany, for example, written by Steven Kinzer. It opens by quoting a priest who was one of the leaders of the popular protests against the communist regime in East Germany. He describes the growing concerns there about what's happening to the society. He says, "Brutal competition and the lust for money are destroying our sense of community, and almost everyone feels a level of fear or depression or insecurity" as they master the new spirit of the age in which we instruct the backward peoples of the world.

The next article turned to what we regard as the showplace, the real success story, Poland, written by Jane Perlez. The headline reads "Fast and Slow Lanes on the Capitalist Road." The structure of the story is that some are getting the point but there are also some who are still backwards. She gives one example of a good student and one example of a slow learner. The good student is the owner of a small factory which is a "thriving example of the best in modern capitalist Poland. It produces intricately designed wedding gowns sold mostly to rich Germans and to that tiny sector of super-rich Poles." This is in a country where poverty has more than doubled since the reforms were instituted, according to a World Bank study last July, and incomes have dropped about thirty percent. However, the people who are hungry and jobless can look at the intricately designed wedding gowns in the store windows, appreciating the new spirit of the age, so it's understandable that Poland is hailed as the great success story for our achievements. This good student explains that "people have to be taught to understand they must fight for themselves and can't rely on others." She is describing a training course she's running that's trying to instil American values among people who are still brainwashed with slogans like, "I'm a miner. Who else is better?" They have got to get that out of their heads. A lot of people are better, namely people who can design wedding gowns for rich Germans. That's the chosen illustration of the success story of American values.

Then there are the failures, still on the slow lane on the capitalist road. Here she picks one as her example, a forty-year-old coal miner who "sits in his wood-paneled living room admiring the fruit of his labour under communism: a TV set, comfortable furniture, a shiny, modern kitchen, and he wonders why he's at home, jobless and dependent on welfare payments," having not yet absorbed the new spirit of the age, gain wealth, forgetting all but self, and not "I'm a miner. Who else is better?" The series goes on like that. It's interesting to read and to see what's taken for granted. What's happening in Eastern Europe recapitulates what's gone on in our Third World domains for a long time and falls into place in a much longer story. It's very familiar from our own history and the history of England before us.

There's a recent book, by a distinguished Yale University labour historian, David Montgomery, in which he points out that modern America was created over the protests of its working people. He's quite right.Those protests were vigorous and outspoken, particularly in the working class and community press that flourished in the U.S. from the early nineteenth century up until the 1930s, when it was finally destroyed by private power, as its counterpart in England was about thirty years later. The first major study of this topic was in 1924 by Norman Ware. It still makes very illuminating reading. It was published here in Chicago and reprinted very recently by Ivan Dee, a local publisher. It's very much worth reading. It's a work that set off a very substantial study in social history. What Ware describes, looking mostly at the labour press, is how the value system that was advocated by private power had to be beaten into the heads of ordinary people, who had to be taught to abandon normal human sentiments and to replace them with the new spirit of the age, as they called it. He reviews the mainly mid-nineteenth century working class press, often, incidentally, run by working class women. The themes that run through it are very constant for a long period.

They are concerned with what they call "degradation" and "loss of dignity and independence, loss of self-respect, the decline of the worker as a person, the sharp decline in cultural level and cultural attainments as workers were subjected to," what they called, "wage slavery," which they regarded as not very different from chattel slavery, which they had fought to uproot during the Civil War. Particularly dramatic and quite relevant to today's problems was the sharp decline in what we call "high culture," reading of classics and contemporary literature by the people who were called the factory girls in Lowell and by craftsmen and other workers. Craftsmen would hire somebody to read to them while they were working because they were interested and had libraries. All that had to go. What they described, quoting from the labour press, is "when you sell your product, you retain your person. But when you sell your labour, you sell yourself, losing the rights of free men and becoming vassals of mammoth establishments of a monied aristocracy that threatens annihilation to anyone who questions their right to enslave and oppress. Those who work in the mills ought to own them, not have the status of machines ruled by private despots who are entrenching monarchic principles on democratic soil as they drive downwards freedom and rights, civilization, health, morals and intellectuality in the new commercial feudalism."

Just in case you are confused, this is long before Marxism. This is American workers talking about their experiences in the 1840s.The labour press also condemned what they called the "bought priesthood," referring to the media and the universities and the intellectual class, that is, the apologists who sought to justify the absolute despotism that was the new spirit of the age and to instil its sordid and demeaning values. One of the early leaders of the AFL, about a century ago, late nineteenth century, expressed the standard view when he described the mission of the labour movement as "to overcome the sins of the market and to defend democracy by extending it to control over industry by working people."All of this would have been completely intelligible to the founders of classical liberalism, people like Wilhelm von Humboldt, for example, who inspired John Stuart Mill, and who very much like his contemporary Adam Smith regarded creative work freely undertaken in association with others as the core value of a human life. So if a person produces an object on command, Humboldt wrote, we may admire what he did but we will despise what he is, not a true human being who acts on his own impulses and desires. The bought priesthood have the task of undermining these values and destroying them among people who sell themselves on the labour market.

For similar reasons, Adam Smith warned that in any civilised society governments would have to intervene to prevent the division of labour from turning people into "creatures as stupid and ignorant as it's possible for a human being to be." He based his rather nuanced advocacy of markets on the thesis that if conditions were truly free, markets would lead to perfect equality. That was their moral justification. All of this has been forgotten by the bought priesthood, who have a rather different tale to tell. Dewey and Russell are two of the leading twentieth-century inheritors of this tradition, with its roots in the Enlightenment and classical liberalism. Even more interesting is the inspiring record of struggle and organization and protest by working men and women since the early nineteenth century as they sought to win freedom and justice and to retain the rights that they had once had as the new despotism of state-supported private power extended its sway.

The basic issue was formulated with a good deal of clarity by Thomas Jefferson around 1816. This was before the Industrial Revolution had really taken root in the former colonies but you could begin to see the developments. In his later years, observing what was happening, Jefferson had rather serious concerns about the fate of the democratic experiment. He feared the rise of a new form of absolutism that was more ominous than what had been overthrown in the American Revolution, in which he was of course a leader. Jefferson distinguished in his later years between what he called "aristocrats" and "democrats." The aristocrats are "those who fear and distrust the people, and wish to draw all powers from them into the hands of the higher classes." The democrats, in contrast, "identify with the people, have confidence in them, cherish and consider them as the honest and safe depository of the public interest, if not always the most wise."

The aristocrats of his day were the advocates of the rising capitalist state, which Jefferson regarded with much disdain, clearly recognising the quite obvious contradiction between democracy and capitalism, or more accurately what we might call really existing capitalism, that is, guided and subsidised by powerful developmental states, as it was in England and the U.S. and indeed everywhere else.This fundamental contradiction is enhanced as new corporate structures were granted increasing powers, not by democratic procedures but mainly by courts and lawyers who converted what Jefferson called the "banking institutions and monied incorporations," which he said would destroy freedom, and which he could barely see the beginnings of in his day. They were converted, mainly through courts and lawyers, into "immortal persons" with powers and rights beyond the worst nightmares of pre-capitalist thinkers like Adam Smith or Thomas Jefferson.

Half a century earlier, Adam Smith already warned against this, though he could barely see the beginnings of it. Jefferson's distinction between aristocrats and democrats was developed about a half a century later by Bakunin, the anarchist thinker and activist, actually one of the few predictions of the social sciences ever to have come true. It ought to have a place of honour in any serious academic curriculum in the social sciences and the humanities for this reason alone. Back in the nineteenth century, Bakunin predicted that the rising intelligentsia of the nineteenth century would follow one of two parallel paths. One path would be to exploit popular struggles to take state power, becoming what he called a "Red bureaucracy that will impose the most cruel and vicious regime in history." That's one strain. The other strain, he said, will be those who discover that real power lies elsewhere, and they will become its bought priesthood, in the words of the labour press, serving the real masters in the state-supported private system of power, either as managers or apologists who beat the people with the people's stick, as he put it, in the state capitalist democracies. The similarities are pretty striking, and they run right up to the present.

They help account for the rapid transitions that people make from one to the other position. It looks like a funny transition, but in fact it's a common ideology.We're seeing it right now in Eastern Europe with the group that's sometimes called the Nomenklatura capitalists, the old communist ruling class, now the biggest enthusiasts for the market, enriching themselves as the societies become standard Third World societies. The move is very easy, because it's basically the same ideology. A similar move from Stalinist commissar to celebration of America is quite standard in modern history, and it doesn't require much of a shift in values, just a shift in judgment as to where power lies.

Independently of Jefferson and Bakunin, others were coming to the same understanding in the nineteenth century. One of the leading American intellectuals was Charles Francis Adams, who in 1880 described the rise of what is now called the "post-industrial society" by Daniel Bell, Robert Reich and John Kenneth Galbraith and others. This is 1880, remember. A society in which, Adams says, "the future is in the hands of our universities, our schools, our specialists, our scientific men and our writers and those who do the actual work of management in the ideological and economic institutions." Nowadays they're called the "technocratic elite" and the "action intellectuals" or the new class or some other similar term.

Adams, back in 1880, concluded that "the first object of thinking citizens, therefore, should be not to keep one or another political party in power, but to insist on order and submission to law." Meaning that the elites should be permitted to function in what's called "technocratic isolation," by the World Bank -- I'm being a little anachronistic here, that's modern lingo -- or, as the London Economist puts the idea today, "policy should be insulated from politics." That's the case in free Poland, they assure their readers, so they don't have to be concerned about the fact that people are calling for something quite different in free elections. They can do what they like in the elections, but since policy is insulated from politics and technocratic insulation proceeds, it really doesn't matter. That's democracy.

A decade earlier, in 1870, Adams had warned -- they were worried then about universal suffrage, people were fighting for the right to vote -- he warned that universal suffrage would "bring the government of ignorance and vice, with power in the hands of the European and especially Celtic proletariat on the Atlantic coast," those horrible Irish people, "an African proletariat on the shores of the Gulf and a Chinese proletariat on the Pacific."Adams didn't foresee the sophisticated techniques that would be developed in the twentieth century to ensure that policy remains insulated from politics as the franchise was extended through popular struggle and to guarantee that the general public would remain marginalised and disaffected, subdued by the new spirit of the age and coming to see themselves not as free people who have a right to dignity and independence but as atoms of consumption who sell themselves on the labour market, at least when they're lucky. Adams was in fact expressing an old idea.

Eighty years earlier Alexander Hamilton had put it clearly. He said there was the idea that your people are a great beast and that the real disease is democracy. That's Hamilton. These ideas have become ever more entrenched in educated circles, as Jefferson's fears and Bakunin's predictions were increasingly realised. The basic attitudes coming into this century were expressed very clearly by Woodrow Wilson's Secretary of State, Robert Lansing, attitudes that led to Wilson's Red Scare, as it was called, which destroyed labour and independent thought for a decade. Lansing warned of the danger of allowing the "ignorant and incapable mass of humanity" to become "dominant in the earth," or even influential, as he believed the Bolsheviks intended. That's the hysterical and utterly erroneous reaction that's pretty standard among people who feel that their power is threatened.

Those concerns were articulated very clearly by progressive intellectuals of the period, maybe the leading one being Walter Lippman in his essays of democracy, mainly in the 1920s. Lippman was also the dean of American journalism and one of the most distinguished commentators on public affairs for many years. He advised that "the public must be put in its place so that the responsible men may live free of the trampling and the roar of a bewildered herd." Hamilton's beast. In a democracy, Lippman held, these "ignorant and meddlesome outsiders" do have a "function." Their function is to be "interested spectators of action" but not "participants." They are to lend their weight periodically to some member of the leadership class, that's called elections, and then they are supposed to return to their private concerns.

In fact, similar notions became part of mainstream academic theory at about the same time.In the presidential address to the American Political Science Association in 1934 William Shepard argued that government should be in the hands of "an aristocracy of intellect and power," while the "ignorant, the uninformed and the anti-social elements" must not be permitted to control elections, as he mistakenly believed they had done in the past. One of the founders of modern political science, Harold Lasswell, one of the founders of the field of communications, in fact, wrote in the Encyclopedia of Social Sciences in 1933 or 1934 that modern techniques of propaganda, which had been impressively refined by Wilsonian liberals, provided the way to keep the public in line. Lasswell described Wilson as "the great generalissimo on the propaganda front." Wilson's World War I achievements in propaganda impressed others, including Adolf Hitler. You can read about it in Mein Kampf.

But crucially they impressed the American business community. That led to a huge expansion of the public relations industry which was dedicated to controlling the public mind, as advocates used to put it in more honest days, just as writing in the Encyclopedia of Social Sciences in 1934, Lasswell described what he was talking about as propaganda. We don't use that term. We're more sophisticated. As a political scientist, Lasswell advocated more sophisticated use of this new technique of control of the general pubic that was provided by modern propaganda. That would, he said, enable the intelligent men of the community, the natural rulers, to overcome the threat of the great beast who may undermine order because of, in Lasswell's terms, the ignorance and superstition of the masses.

We should not succumb to "democratic dogmatisms about men being the best judges of their own interests." The best judges are the elites, who must be ensured the means to impose their will for the common good. Jefferson's aristocrats, in other words. Lippman and Lasswell represent the more liberal, progressive fringe of opinion which grants the beast at least a spectator role. At the reactionary end you get those who are mislabelled conservatives in contemporary newspeak. So the Reaganite statist reactionaries thought that the public, the beast, shouldn't even have the spectator role.

That explains their fascination with clandestine terror operations, which were not secret to anybody except the American public, certainly not to their victims. Clandestine terror operations were designed to leave the domestic population ignorant. They also advocated absolutely unprecedented measures of censorship and agitprop and other measures to ensure that the powerful and interventionist state that they fostered would serve as a welfare state for the rich and not troubled by the rabble.The huge increase in business propaganda in recent years, the recent assault on the universities by right-wing foundations, and other tendencies of the current period are other manifestations of the same concerns.

These concerns were awakened by what liberal elites had called the "crisis of democracy," that developed in the 1960s, when previously marginalised and apathetic sectors of the population, like women and young people and old people and working people and so on, sought to enter the public arena, where they have no right to be, as all right-thinking aristocrats understand. John Dewey was one of the relics of the Enlightenment classical liberal tradition who opposed the rule of the wise, the onslaught of the Jeffersonian aristocrats, whether they found their place on the reactionary or the liberal part of this very narrow ideological spectrum.

Dewey understood clearly that "politics is the shadow cast on society by big business," and as long as this is so, "attenuation of the shadow will not change the substance." Meaning, reforms are of limited utility. Democracy requires that the source of the shadow be removed not only because of its domination of the political arena, but because the very institutions of private power undermine democracy and freedom. Dewey was very explicit about the antidemocratic power that he had in mind. To quote him: "Power today" -- this is the 1920s -- "resides in control of the means of production, exchange, publicity, transportation and communication. Whoever owns them rules the life of the country, even if democratic forms remain.

Business for private profit through private control of banking, land, industry reinforced by command of the press, press agents and other means of publicity and propaganda, that is the system of actual power, the source of coercion and control, and until it's unravelled we can't talk seriously about democracy and freedom." Education, he hoped, of the kind he was talking about, the production of free human beings, would be one of the means of undermining this absolutist monstrosity. In a free and democratic society, Dewey held, workers should be the masters of their own industrial fate, not tools rented by employers. He agreed on fundamental issues with the founders of classical liberalism and with the democratic and libertarian sentiments that animated the popular working class movements from the early Industrial Revolution, until they were finally beaten down by a combination of violence and propaganda.

In the field of education, therefore, Dewey held that it is "illiberal and immoral" to train children to work "not freely and intelligently, but for the sake of the work earned," in which case their activity "is not free because not freely participated in." Again the conception of classical liberalism and the workers' movements. Therefore, Dewey held, industry must also change "from a feudalistic to a democratic social order" based on control by working people and free association, again, traditional anarchist ideals with their source in classical liberalism and the Enlightenment. As the doctrinal system has narrowed under the assault of private power, particularly in the past few decades, these fundamental libertarian values and principles now sound exotic and extreme, perhaps even anti-American, to borrow one of the terms of contemporary totalitarian thought in the West. Given these changes, it's useful to remember that the kinds of ideas that Dewey was expressing are as American as apple pie. They have origins in straight American traditions, right in the mainstream. Not influenced by any dangerous foreign ideologies. In a worthy tradition that's ritually lauded, though it's commonly distorted and forgotten. And all of that is part of the deterioration of functioning democracy in the current age, both at the institutional and at the ideological level, in my opinion.

Education is, of course, in part a matter of schools and colleges and the formal information systems. That's true whether the goal of education is education for freedom and democracy, as Dewey advocated, or education for obedience and subordination and marginalization, as the dominant institutions require. The University of Chicago sociologist James Coleman, one of the main students of education and effects of experience on children's lives, concludes from many studies that "the total effect of home background is considerably greater than the total effect of school variables in determining student achievement." Actually, about twice as powerful in effect, he concludes from a lot of studies. So it's therefore important to have a look at how social policy and the dominant culture are shaping these factors, home influences and so on.That's a very interesting topic.

The inquiry is much facilitated by UNICEF study published a year ago called Child Neglect in Rich Nations, written by a well-known American economist, Sylvia Ann Hewlett. She studies the preceding fifteen years, the late 1970s up through the early 1990s, in the rich nations. She's not talking about the Third World but about the rich countries. She finds a sharp split between the Anglo-American societies on the one hand and continental Europe and Japan on the other hand. The Anglo-American model, spearheaded by the Reaganites and Thatcher, has been a disaster for children and families, she says.The European model, in contrast, has improved their situation considerably, from a starting point that was already considerably higher, despite the fact that the European societies lack the huge advantages of the Anglo-American societies. The U.S. has unparalleled wealth and advantages, and while the United Kingdom, Britain, has severely declined, particularly under Thatcher, it has the economic advantage, at least, of being a U.S. client as well as being a major oil exporter in the Thatcher years. That's something that makes the economic failure of Thatcherism even more dramatic as authentic British conservatives like Lord Ian Gilmour have shown.

Hewlett describes the Anglo-American disaster for children and families as attributable "to the ideological preference for free markets." Here she's only half right, in my opinion. Reaganite conservatism opposed free markets. It did advocate markets for the poor, but it went well beyond even its statist predecessors in demanding and winning a very high level of public subsidy and state protection for the rich. Whatever you choose to call this guiding ideology, it's unfair to tarnish the good name of conservatism by applying it to this particular form of violent and lawless and reactionary statism. Call it what you like, but it's not conservatism. It's not the free market.

However, Hewlett is quite right in identifying the free market for the poor as the source of the disaster for families and children. And there isn't much doubt of the effects of what Hewlett calls the "anti-child and anti-family spirit that's loose in these lands," in the Anglo-American lands, most dramatically in the U.S., but also Britain. This "neglect-filled Anglo-American model based on market discipline for the poor has largely privatised child rearing while making it effectively impossible for most of the population to rear children." That's been the combined goal and policy of Reaganite conservatism and the Thatcherite analogue. The result is, of course, a disaster for children and families.Continuing, Hewlett points out, "in the much more supportive European model, social policy has strengthened rather than weakened support systems for families and children." It's no secret, except of course as usual to readers of the press.

As far as I'm aware, this 1993 study, rather critically relevant to our current concerns, has yet to be reviewed anywhere. It's not been, say, featured in the New York Times, although the Times did devote last Sunday's book review section largely to this topic, with sombre forebodings about the fall of IQ, the decline of SAT scores and so on and what might be causing it. Say, in the city of New York, where the social policies that have been pursued and backed by the Times have driven about forty percent of the children below the poverty level, so that they're suffering malnutrition, disease and so on. But it turns out that is irrelevant to the decline in IQ, as is anything that Hewlett discusses in this Anglo-American neglect-filled model. What's relevant, it turns out, is bad genes. Somehow people are getting bad genes, and then there are various speculations about why this is. For example, maybe it's because black mothers don't nurture their children, and the reason is maybe they evolved in Africa where the climate was hostile. So those are maybe the reasons, and this is really serious, hard-headed science, and a democratic society will ignore all this at its peril, the reviewer says. Well-disciplined commissars know well enough to steer away from the obvious factors, the ones rooted in very plain and clear social policy. They are perfectly evident to anybody with their head screwed on and happen to be discussed in considerable detail by a well-known economist in a UNICEF study that's not likely to see the light of day around here.The facts are no secret. A blue-ribbon commission of the state boards of education and the American Medical Association reported, "Never before has one generation of children been less healthy, less cared for, and less prepared for life than their parents were at the same age." That's a big shift in an industrial society. It's only in the Anglo-American societies where this anti-child, anti-family spirit has reigned for fifteen years under the guise of conservatism and family values. That's a real triumph for propaganda. It's one that would very much have impressed even "generalissimo" Woodrow Wilson, or probably Stalin and Hitler.

A symbolic expression of this disaster is that when Hewlett wrote her book a year ago, 146 countries had ratified the international convention on the rights of the child, but one had not: the U.S. That's a standard pattern for international conventions on human rights. However, just for fairness, it's only proper to add that Reaganite conservatism is catholic in its anti-child, anti-family spirit, so the World Health Organization voted to condemn the Nestle Corporation for aggressive marketing of infant formula, which kills plenty of children. The vote was 118 to 1. I'll leave you to guess the one. However, this is quite minor compared with what the World Health Organization calls the "silent genocide" that's killing millions of children every year as a result of the freemarket policies for the poor and the refusal of the rich to give any aid. Again, the U.S. has one of the worst and most miserly records among the rich societies.

Another symbolic expression of this disaster is a new line of greeting cards by the Hallmark Corporation. One of them says, "Have a super day at school." That one, they tell you, is to be put under a box of cereal in the morning, so that when the children go off to school it says, Have a super day at school. Another one says, "I wish I had more time to tuck you in." That's one that you stick under the pillow at night when the kid goes to sleep alone. [laughter] There are other such examples. In part this disaster for children and families is the result simply of falling wages. State corporate policy has been designed for the last years, especially under the Reaganites and Thatcher, to enrich small sectors and to impoverish the majority, and it succeeded. It's had exactly the intended effect. That means that people have to work much longer hours to survive. For much of the population both parents have to work maybe fifty to sixty hours merely to provide necessities.

Meanwhile, incidentally, corporate profits are zooming. Fortune magazine talks about the "dazzling" profits reaching new heights for the Fortune 500 even though sales are stagnating. Another factor is job insecurity, what economists like to call "flexibility in the labour markets," which is a good thing under the reigning academic theology, but a pretty rotten thing for human beings, whose fate doesn't enter into the calculations of sober thinking. Flexibility means you better work extra hours or else. There are no contracts and no rights. That's flexibility. We've got to get rid of market rigidities. Economists can explain it. When both parents are working extra hours, and for most on falling incomes, it doesn't take a great genius to predict the outcome. The statistics show them.

You can read them in Hewlett's UNICEF study if you like. It's perfectly obvious without reading them what's going to happen. Contact time, that is, actual time spent by parents with children, has declined forty percent in the last twenty five years in the Anglo-American societies, mostly in recently years. That's actually ten to twelve hours a week of eliminating contact time and what they call "high quality time," time when you're not just doing something else, is virtually disappearing. Of course that leads to the destruction of family identity and values. It leads to sharply increased reliance on television for child supervision. It leads to what are called "latchkey children," kids who are alone, a factor in rising child alcoholism and drug use and in criminal violence against children by children and other obvious effects in health, education, ability to participate in a democratic society, even survival, of course decline in SATs and IQs, but you're not supposed to notice that. That's bad genes, remember.

None of these things are laws of nature. These are consciously selected social policies designed for particular goals, namely enrich the Fortune 500 but impoverish others. In Europe, where conditions are more stringent but policy is not guided by the same anti-family, anti-child spirit, the tendencies are in the opposite direction and the standards for children and families are much better. It's worth mentioning, and let me stress, that this is not just true in the Anglo-American societies themselves. We're a big, powerful state. We have influence. It's very striking to notice what happens when other countries within the range of our influence try to undertake policies that benefit families and children. There are two striking examples. The region that we control most completely is the Caribbean and Central America.

There are two countries there that did undertake such policies: Cuba and Nicaragua, and with considerable success, in fact. Something which should surprise no one is that those are the two countries that were primarily targeted for U.S. assault. And it succeeded. So in Nicaragua, the rising health standards and the improvement in literacy and the reduction in child malnutrition have been reversed thanks to the terrorist war that we fought in Nicaragua, and now it's proceeding to the level of Haiti. In the case of Cuba, of course, the terrorist war has been going on a lot longer. It was launched by John F. Kennedy. It had nothing to do with communism. There weren't any Russians around. It had to do with things like the fact that these people were devoting resources to the wrong sectors of the population. They were improving health standards. They were concerned with children, with malnutrition.

Therefore we launched a huge terrorist war. A bunch of CIA documents were just released recently filling in some of the details of the Kennedy period, which was bad enough. It continues up to the present. Actually, there was another assault just a couple of days ago. On top of that there's an embargo to try to ensure that they'll really suffer. For years the pretext was that this had to do with the Russians, which is completely fraudulent, as you can see by what was going on when the policies were instituted and as is demonstrated conclusively by what happened after the Russians disappeared. Here was a real job for the bought priesthood. They have to not notice that after the Russians disappeared we harshened the attack against Cuba. Kind of odd if the reason for the attack was that they were an outpost of communism and the Russian empire. But we can handle that.

So after the Russians disappeared from the scene and it really became possible to strangle them, the conditions got harsher. A proposal was sent through Congress by a liberal Democrat, Representative Torricelli, calling for a cutoff of any trade with Cuba by any subsidiary of any American corporation or any foreign corporation that used any parts produced in the U.S. That is so obvious in violation of international law that George Bush vetoed it. However, he was forced to accept it when he was outflanked from the right by the Clintonites in the last election, so he did then allow it to go through.That went right to the United Nations, where the U.S. position was denounced by just about everybody. In the final vote, the U.S. could pick up only Israel, which is automatic, and they got Rumania for some reason. Everyone else voted against it. The U.S. position was defended by no one. It is an obvious violation of international law, as even Britain and others pointed out.

But it doesn't matter.It's extremely important to carry out our anti-child, anti-family spirit and our insistence on highly polarised societies everywhere we can go. If any foreign country under our control tries to go that way, we'll take care of them, too. That's now continuing. It's the kind of thing you can actually do something about if you like. In Chicago there is the Pastors for Peace and the Chicago-Cuba Coalition has another caravan going to Cuba to try to undermine the embargo and bring humanitarian aid, medicines, medical books, powdered milk for infants and other assistance. They're in the phone book under Chicago-Cuba Coalition. You can look them up. Anyone who is interested in countering the anti-child, anti-family spirit that reigns here and that we're exporting by violence elsewhere can do that, just as they can do plenty of things at home.

I should say that the effects of this latest Democratic proposal, which went through, to strangle Cuba, have recently been reviewed in this month's issues, October, of two leading American medical journals, Neurology and the Florida Journal of Medicine, which simply review the effects. They point out the obvious thing. It turns out that about ninety percent of the trade that was cut off by the Clinton-Torricelli bill was food and humanitarian aid, food, medicine and things like that. For example, one Swedish company which was trying to export a water filtration device to create vaccines was blocked by the U.S. because there's some part in it that's American-made. We really have to strangle them badly. We have to make sure that plenty of children die. One effect is a very sharp rise in infant mortality and child malnutrition. Another is a rare neurological disease that's spread over Cuba that everyone pretended they didn't know the reasons for. But of course they did, and now it's conceded. It's malnutrition, a disease which hasn't been seen since Japanese prison camps in the Second World War. So we're succeeding in that one.

The anti-child, anti-family spirit is not just directed against kids in New York, but much more broadly.I stress again that the difference in Europe -- it is different in Europe, and there are reasons for it. One of the differences is the existence of a strong trade union movement. That's one aspect of a more fundamental difference, namely, the U.S. is a business-run society to quite an unparalleled degree, and as a result the vile maxim of the masters prevails to an unprecedented extent, pretty much as you'd expect.These are among the means that allow democracy to function formally, although by now most of the population is consumed by what the press calls "anti-politics," meaning hatred of government, disdain for political parties and the whole democratic process. That, too, is a great victory for the aristocrats in Jefferson's sense, that is, those who fear and distrust the people and wish to draw all power from them into the hands of the higher classes.

By now that means into the hands of transnational corporations and the states and quasi-governmental institutions that serve their interests.Another victory is the fact that the disillusionment, which is rampant, is anti-politics. A New York Times headline on this reads, "Anger and Cynicism Well Up In Voters As Hope Gives Way. Mood Turns Ugly as More People Become Disillusioned With Politics." Last Sunday's magazine section was devoted to anti-politics. Notice: not devoted to opposition to power and authority, to the easily identifiable forces that have their hands on the lever of decision-making and that cast their shadow on society as politics, as Dewey put it. They have to be invisible to the commissar class. The Times has a story today again about this topic where they quote some uneducated person who doesn't get the point. He says, "Yeah, Congress is rotten, but that's because Congress is big business, so of course it's rotten." That's the story you're not supposed to see. You're supposed to be anti-politics.

The reason is that whatever you think about government, it's the one part of the system of institutions that you can participate in and modify and do something about. By law and principle you can't do anything about investment firms or transnational corporations. Therefore nobody better see that. You've got to be anti-politics. That's another victory. Dewey's observation that politics is the shadow cast on society by big business, which was incidentally also a truism to Adam Smith, has now become invisible. The force that casts the shadow has been pretty much removed by the ideological institutions and is so remote from consciousness that we're left with anti-politics. That's another severe blow to democracy and a grand gift to the absolutist and unaccountable systems of power that have reached levels that a Thomas Jefferson or John Dewey could scarcely imagine.

We have the usual choices. We can choose to be democrats in Thomas Jefferson's sense. We can choose to be aristocrats. The latter path is the easy one. That's the one that the institutions are designed to reward. It can bring rich rewards given the locus of wealth and privilege and power and the ends that they very naturally seek. The other path, the path of the Jeffersonian democrats, is one of struggle, often defeat, but also rewards of a kind that can't even be imagined by those who succumb to the new spirit of the age, gain wealth, forgetting all but self. It's the same now as it was 150 years ago when there was an attempt first to drive it into the heads of the factory girls in Lowell and the craftsmen in Lawrence and so on. Today's world is very far from Thomas Jefferson's. The choices it offers, however, have not changed in any fundamental way. October 19, 1994

"The glory of the United States is business" - Wendell L. Willkie, 1936

"What else do bankers do -- walk-in and turn-off the lights in the country." - William Slee, 1978

"I sincerely believe that banking establishments are more dangerous than standing armies." - Thomas Jefferson, 1816

“The HISTORY of an oppressed people is hidden in the lies and the agreed myth of its conquerors.” - Meridel Le Sueur, American writer, 1900-1996

“Nations whose NATIONALISM is destroyed are subject to ruin.” - Colonel Muhammar Qaddafi, 1942-, Libyan Political and Military Leader

"We shall be better and braver and less helpless if we think that we ought to enquire, than we should have been if we indulged in the idle fancy that there was no knowing and no use in seeking to know what we do not know..." - SOCRATES

"Upang maitindig natin ang bantayog ng ating lipunan, kailangang radikal nating baguhin hindi lamang ang ating mga institusyon kundi maging ang ating pag-iisip at pamumuhay. Kailangan ang rebolusyon, hindi lamang sa panlabas, kundi lalo na sa panloob!"--Apolinario Mabini La Revolucion Filipina (1898)


Anonymous said...

To Bert Drona and Satur Respicio, who are trying to save the Philippines.

Satur and Bert, this is an essay about rice versus cars, and also about false leftist nationalism.

Rice and false nationalism won't save the Philippines. Rice is not even 1/5 of 1% of world exports that now stand at $9 trillion. We won't earn even $500 million from exports of it. We need big dollars--about 2,000 times as much--or $1 trillion-- to finance imported power plants, university labs, roads, ports, factory machines, better schools.

The biggest exports markets are electronics, transport, machines, appliances, instruments, consumer staples, toys, chemicals, knick-knacks: in other words industrial exports, 85% of world trade.

Agricultural products are a trivial part of world trade--less than 7% of it. So too energy--coal and oil and gas-- less than 10% of world exports.

See below how China is making inroads at cars. China's car exports could easily reach $100 billion annually-- or 200 times as big as any Philipine possibility at rice exports!

If we prepared to succeed at cars, we could capture a $25 billion share in world car exports in 15 to 20 years, why not? If we truly prepared for it, we and China, Brazil, India, and Mexio would wipe out the American, European, Japanese and South Korean car industries--with Americans, Europeans, Japanese and South Koreans as our allies at that creative destruction, as is now happening in China.

Car exports could be one of the major products saving the Philippines. Such exports would also mean radio exports, CD exports for these are parts of cars. So too, coconut coir exports, for they could be incorporated in the seats.

My other comments follow satirizing Philippine leftists and nationalists who think that working with multinationals is a dangerous activity good only for powerful imperialists and bad for Third world dupes.

(It is terrible that American and Japanese imperialists are modernizing China. That will destroy China's good old days of poverty. Thank the Lord that Filipino nationalists leftists like Walden Bello, Jo Ma Sison, Bert Drona and the ghost of Renato Constantino, are warning us about multinationals and will keep them out, ensuring that Filipinos lack electricity, water, telecom, and modern factories. Thank to them that we will remain poor and innocent in our rice fields in the Philippine Garden of Eden. Riches corrupt, and great riches corrupt greatly. Poverty keeps our thoughts clean...and serpents our overlords. )

This is bad news--Chinese picking up technology and rising to the top in their own country at industy. Please, please... bring back the good old days of Chinese rice-growing peace and grovelling to white and Japanese masters.)

When annual production will get to be 46 million units, which would be commensurate with China's population size, of which exports will be 20 million per year, exports will have a value of $250 billion (!) at today's average export prices).

(Also the way Germany and Japan, whose factories were destroyed after World War II, built new factories that started killing America at cameras, radios, TV, steel, machine tools, by the 1960s and 1970s).

(wow! Touring China, Bill Gates was blown away by the energy of Chinese workers, running to get things done compared with easy ambling in America.)

Multinationals are irreverent, corrupting China with modernity. The Middle Kingdom must be preserved. Or, better, it must siddle back to the agricultural purity of ancient times, like the Philippines, hearkening to those first farming days of 10,000 yeas ago.)

So Filipino leftists are wrong? When they are not blocking multinational entry, they demand the most advance technologies from them?)

No, no, I protest these just-in-time systems that Satanic Japan originated. Why must the Middle Kingdom modernize? It is already heaven!--like the Philippines, devoid of the temptations of modern industrial progress and loyal to Eden and bucolic agrarian dreams.)

How terrible: young people are finding a bright future. Whatever happened to the good old days of stagnation?)

See how corrupting modern times is. Walden Bello is a better thinker. He says no to exports, no to the world. We must heed Walden, loyal to the good old Philippine days of no global ambition. Thank God, he is a professor of the University of the Philippines!)

Satur Respicio: the leftist nationalists I am laughing at are: Walden Bello, Jo Ma Sison, the late Renato Constantino, Crispin Beltran, and Bayan Muna congressmen who are global innocents.

(I am also teasing the leftist Ramon Ramires and the agriculturally oriented Alex K. and Satur Respicio-- all fraternity brother engineers who are would-be nationbuilders with weak ideas.

(Satur, Mon, and Alex, I also want to be constructive. Please understand that rice, coconuts, bananas, mangoes won't save the Philippines. They are trivial in world trade--less than $15 billion annually (less than 1.7% of world exports), and the Philippines will caputre less than 10% of it-- less than $1.5 billion annually. We need exports 700 times as high, and global agricultural markets are too small make it happen for us !

World industrial export markets are 12 times as large as the farm export market. An Asian "nation" states that we could capture 16% of that industrial export market--equal to $1.1 trillion of industrial export products-- so we prosper.

This Asian "nation" has a smaller population than ours but now has a 16% share of world industrial export markets. It rose to that level from from near zero in 1960, using smarts that Filipinos and certain fraternty brothers have lacked. Its wages are 12 to 19 times as high as ours. That is, our wages are only 5% to 9% as high as its wages. That means that we could succeed as well it in world markets, including stealing the industrial exports of this Asian nation.

That Asian "nation" has four provinces:
Hong Kong (population 7 million; projected 2006 exports $340 billion);
South Korea (population 48 million; projected 2006 exports $330 billion);
Singapore (population 4 million; projected 2006 exports $230 billion);
Taiwan (population 23 million; projected 2006 exports $190 billion).
Summary: HoKorSinTa, population 82 million, projected exports $1.1 trillion.

Philippines, population 88 million, 2006 exports $43 billon

Filipinos were also at near zero at industrial exports in 1960, and are still at near zero in 2005!--their share has risen to only 1/2 of 1% of that market as of 2005.

That percentage is far below the Philippine share in world population of 1.5%, which means that Filipinos are underachievers in world markets.

The problem is not that Filipinos spend too much time making babies. The problem is that the heads of Filipino intellectuals--Joma Sison, President Arroyo, Gringo Honasan, Pimentel, Cojuangco, and our billionaires are stuffed with inferior ideas centered on:
Agriculture not earning dollars;
Gawad Kalinga pig pens dissipating dollars;
Land reform dissipating dollars;
"Nationalist industrialization" with small factories geared only to the home market and hemorraghing dollars to import components to assemble;
Microfinance and rural bank projects not earning dollars,
NGOs doing everything but earn dollars,
Livelihood, backyard projects not earning dollars;
Futile anti-corruption crusades without bugging devices and other imported electronic devices to track, eavesdrop on, and catch corrupt people unaware;and
other globally-trivial programs like that, such as decentralizing gov't offices to the provinces which is another plan that will not earn dollars, or such as Federalization or Parliamentarization that again won't help much, if at all, to earn dollars.
Satur, please get out of your rice binge. Please tell Alex Kho and Mon Ramirez to do same. Help save the Philippines. You are now keeping it poor through too much attention to inferior projects like rice.

Let's do rice later, after succeeding at industrial exports. Then we can import tractors to build dams, and chemicals to kill farm devils, and pumps to manage water, and tractors to build rural roads, and ventilators for granaries, and freezers for meat processing, and ships, trucks, oil to transport farm products. Without these industrial inputs, Masagana is a useless seed. So too, the palay harvest from the Lim seed will be low. An incomplete industrial approach to rice growing and agriculture would make rice gods and farmers die.

If we were succeeding at industrial exports, we would have the dollars to import tractors, steel, ventilators, trucks, ships, oil, granary elevators, compressors, chemicals, pumps. Then and only then would Lim or Masagana seeds lead to any significant success.

Think completely, Satur, Mon, Alex....while trying to save the Philippines. Incomplete thinking is dangerous.

Shortcut: Learn my approach, master my data, and propagate them. Make them yours and succeed with them...

I am not egotistical, and am simply asking for your help, Satur and Alex, since I am lazy.

I request you to do the work of using my ideas to make the Philippines rich and prosperous industrially, so that lazy old me will retire to my bahay kubo planting sitaw, bataw, patani and rice in the bukid, and learning and teaching Tagalog and Cebuano.

I am not trying to put you down, Satur, and I surely appreciate the achievement of Mr. Lim at rice seed development. But, you are turning a rice plot into a Sierra Madre. Not valid.

And, U.P. alumni must grow to become great leaders in other fields that will in ultimately be far more significant to our future than rice.

Norman Madrid
in the Garden State of New Jersey and the Big Apple of New York

(so-called because NJ is a Garden of Eden teeming with industrial plants, and NY is brimming with Apple computer stocks that are shooting up in Wall St.)

Bert M. Drona said...

Hello Norman,

Thanks for suggestions on how to save our homeland.

I'll think the way you do.

So, Pass the hat for capitalizing on projects based on "blue sky" ideas, remember we're bankrupt with $56+ billion (60% of GNP)in foreign debt.

A short and simple look-see of our BSP statistic shows we import more than export, i.e. thus our trsde balance is (-)$5.428 bllion for 2004, latest year available with complete data.

Our OFWs remitted %8.55 billion for same year Y2004.

On second thought, the simplest solution that comes to my mind at this instant seems to be for our government to send 2-3 times more of our natives to be OFWs and force them to not come back home but to continue remitting all their earnings. That should give us at least $17-27 Billion each year!!

With that amount,who needs to work in the homeland, who needs foreign investors. We can keep all our remaining natural resources intact too!

While you can stay and have your beer and barbie in NJ while watching the daily Business Report!
That would be great for you and all! Right?


Anonymous said...

Hi Bert,

You say that with $56 billion+ of debt ($67 billion is the latest estimate), the Philippines is bankrupt and lacks the funds to build a strong economy. You must rethink this statement.

It is not the $67 billion debt that is our problem. The problem is much smaller though significant. It is the $6 billion of annual debt service that must be paid for interest and principal to amortize the debt. This challenge is easy to meet with good thinking: use Asian Tiger policies that will soon bring in $5 billion to $10 billion of export-oriented foreign investment dollars and rising up to 20% annually, and that would enable us to double exports every three to four years.

With Tiger policies, Malaysia and Thailand sometimes attracted $5 billion to $7.5 billion annual foreign investment inflows while we were getting morsels of $250 million to $2.5 billion, usually $1 billion.

Likewise, Tiger Hong Kong, Singapore, Taiwan were easily attracting $5 billion to $8 billion of foeign direct investment inflows in the late 1980s/early 1990s while Tiger China has been pulling in $50 billion and higher amounts in recent years.

With an initial $5 billion to $10 billion of annual foreign direct investment inflows invested in infrastructure- and export-development, and with those inflows growing 10% to 20% annually, our exports could rise as follows:
Exports today (2006) $ 42 billion
In 2009, after 3 years $ 84 billion
In 2012, 3 more years $ 168 billion
In 2015, 3 more years $ 336 billion
In 2018, 3 more years $ 672 billion
In 2021, 3 more years $ 1,344 billion
In 2024, 18 years hence $ 2.7 trillion
That trajectory would be miraculous, as in the Asian Tiger economies otherwise known as miracle economies.

Since we can achieve the miracle though good thinking, you should not poison the Filipino confidence with false alarms. You should instead teach the nation to understand its potential and have the positive, efficient, and confident spirit to realize it.

The likelihood is that in the next 18 years, world exports will double every six years and would rise to $72 trillion, up from $9 trillion today. So, the "miraculous" $2.7 trillion of Philippine exports in 18 years would imply a nearly 4% Philippine market share in world exports. Since Filipinos are expected to be at most 1.8% of world population by then compared to 1.5% now, the nearly 4% Filipino share in world exports would signify that Filipinos have started to become overachieivers at world trade, which is good.

Do you pooh pooh such a rapid rate of Filipino export expansion--doubling every three years-- as a Blue Sky fantasy? Don't. Even President Ramos achieved a 3.5-year doubling rate. Exports grew more than 22% annually under him, rising from $9.8 billion in 1992 to $29.5 billion by 1998.

To realize or potential, we will need to promote Free Trade and Open Door economic policies.

The economy should be opened up liberalizing five laws: 1) Article 12 of the Constitution re utilities; and the 2) banking law, 3) port law, 4) retail trade law, and 5) media law. In these fields, foreigners should be allowed majority ownership control up to 100% control.

When foreigners apply to invest in the Philippines, our response to them should be like Hong Kong's in recent years, and I don't exaggerate. Hong Kong sounded, and may still do sound, like this:
"Go Ahead, build your business today, at once, and come back next month or two to follow up on your application. If you will be common-sensical and will not pollute or endanger Hong Kong, then of course your application to invest will be approved. But, if you will have been careless and violated regulations and basic standards of safety, hygiene and cleanliness, and are doing hazardous or illegal stuff, then you will be closed up or prosecuted! Of couse you could appeal our decision to a court. We will not abuse our powers."
Getting such a practical response, foreign investors moved fast but carefully to get established in in Hong Kong. They opened businesses big or small that obeyed local rules. With real estate costs high, they selected globally-profitable businesses. Thus, Hong Kong boomed. Employment soared. It dominated or was a significant player in the world at textiles, cameras, toys, watches, knick knacks, as well as in banking and financial dealings, which are very profitable enterprises.

Now, the Hong Kong that was poorer than the Philippines in the early 1960s, is the 8th richest economy in the world in income per capita (measured in purchasing power parity dollars)! It caught up with, and then surpassed all major Western and Asian economies including Japan, Germany, Switzerland, Italy, France, the UK, and Canada, except Luxembourg, America, and Norway.

If we had an Open Philippines, then low Filipino wages will be the magic wand that would conjure an economic miracle. First, builders of utilities and infrastructure will come in big, salivating over their Philippine potential with valid reasoning as follows:
"If we built or improved Philippine ports, railways, airfields, warehouses, and water, power, and telecom systems, then the world's exporters would flock to the Philippines to avail of the new faciliteis and low cost Filipino labor. They will do so our of greed and fear. The greed to competitively kill rivals worldwide with efficient new infrastructure and low Filipino wages. The fear that their multinational rivals will think the same way and move faster to the Philippines to kill them. So, every multinational will race to invest in the Philippines to have lunch, or else themselves become lunch. They will become our great customers making us builders of utilities and infrastructure rich.

"We don't worry that if we build in the Philippies, multinationals won't come to patronize them, going instead to China. where wages are lower than in the Philippines. Fact is, Chinese wages won't be low forever. And, China, in any case, cannot win all global markets to itself. There will be room for Filipino victories against Asian Tigers and Westerners. So, we foreign utility guys, and port and railway builders and warehouse owners and airport operators will build in the Philppines, and expect to make much money as multinational exporters flood in."
You worry that at the foreign investment inflow and export process, the Philippines will forever be only an exploited provider of cheap labor. Here, you must evolve your ideas to learn how workers will get rich in the process, yet still be a competitive part of the global scene.
As billions of dollars of infrastructure and export-oriented investments flow in, jobs will multiply and the local economy will get stimulated. Gross Domestic Product will grow 8% to 14% annually, which is known as Tiger economic growth for 20 years or more.
It would take lots of workers to produce the soaring output of export and local products. Jobs would grow 5% to 6% annually, as happened in Tiger Asia, far outstripping the 2.6% to 2.8% growth of the labor force. The current 12.4% unemployment rate would plunge to less than 2% in 5 years, while the more than 20% of hidden unemployment would take just a little bit longer to go away--9 more years.

With the tighter labor market, every firm will have to steal workers from other firms, pushing wages faster than profits. So, income distribution will improve. The competitive open market, Adam Smith, and the Invisible Hand will be the necessary and sufficient Holy Trinity assuring tha just result.

If labor will be tight, capitalists will be forced to invest in more capital per worker so as to continue to capture global market profit opportunities. Thus, productivity per worker will rise. So, firms must pay higher wages for their more productive workers or their competitors will steal the workers away.
This dynamic process that pushes up worker wages occurred in every booming economy and without making workers necessarily uncompetitive in world markets. When wages only move up with rising productivity, the original labor cost advantage is preserved. Hence it is that Hong Kong, Japan, Westerners do continue to hold on to respectable global market shares and maintain their riches despite their high wages, except that those wages are no longer rising as fast as before. So, Philippine workers will get rich but will still continue to look cheap relative to their productivity.

The other advantage from working with multinationals at exports will be that in their efficient factories and offices, Filipinos will aquire technological and business knowledge approaching levels in the advanced economies. Filipino workers will become globally able ad "bankable". They will be able to acquire loans or investment asset to develop business that will become new successes at world trade!

With progress like that, the nation's foreign debt could disappear in less than 15 years, replaced by zooming foreign exchange reserve accumulations, as experienced by all globally-successful nations in the world!

So Bert, do improve your thinking on our future. With better policies promoted by you and me, the nation will prosper. Let us develop a globally confident and able people. Let us abandon forlorn, defensive, comlaining, isolationist, defeatist thinkers like Recto, Renato Constantino, Jo Ma Sison, Walden Bello, Crispin Beltran, and Bayan Muna.

If you think Gloria is an incompetent leader, I agree.

Exports have grow less than 1% annually during her term, falling from $40 billion in her first year (2001) to $37 billion in 2003, and recovering to only $41.5 billion this year. Foreign investment under her has been falling, too, to a level less than one-half as high as when she started.

But, she is the elected leader! The polls before the election showed she would win, and exit polls suggested the same thing. That she cheated to ensure her victory is morally wrong, but, set it aside--she feared cheating by the other side. That means that we must suffer her until the next Presidential election.

We could ask her to resign, but, with a VP worse than Gloria, and with the opposition as incompetent as Gloria, that would be unwise. In this situation, let us ignore Gloria and her opposition. Instead, let us focus on what we can do while suffering Gloria, suffering the opposition, and suffering wannabe coup leaders. We should do the following:
Organize a move to force through a liberalization of the Constitution's Article 12 and the port, banking, media, and retail trade laws.
Find investors with whom to set up mutual funds that make more than 20% annually in global stock markets. Then the funds could attract much wealth to manage--perhaps $1 trillion to $1.5 trillion, which is the size of the global portfolios of UBS, JP Morgan Chase, Barclays, Fidelity, and Vanguard . We could then invest billion dollar sums in 50 or more multinationals and push them to the Philippines to become our foreign allies for victory at export wars!
Thus, we would make the Philippines boom despite incompetent Gloria and the incompetent opposition.

I hope I have given you some useful ideas to work with. Do you think you can teach the equally incompetent Walden Bello and Jo Ma Sison to grow up using the material here?

Can you also access the ghosts of Recto and Renato Constantino to rewrite their terrible speeches?

Do you have a reliable medium to work with? I'd like to bring in Deng Xiao Ping, Queen Elizabeth 1, Peter the Great, Park Chung Hee, and Catherine the Great, along with Adam Smith, as spirits helping to lead the Philippines.

Re sending more OFWs abroad to uplift the Philippines, that won't work. They'd only send $30 bilion of sterile inflows to the Philippines to support consumption and homebuilding and non-dollar-earning backyard projects. That won't make the nation productive. By contrast, when $10 billion of foreign investor comes in, it comes with machines, technologies, and efficient, productive investor brain power. The nation would become more productive.

Another thing: OFW inflows to America and most rich countries are subject to a quota. We can't double or triple the OFW outflow at will.

I know you are joking with the 2X to 3X idea. Am only making sure that others don't take you seriously.

Norman Madrid

Bert M. Drona said...


It would be nice if you can highlight in detail the specific machines, technologies and brainpower foreigners brought in. There must be a lot of industries (not just service providers like call centers, fast food restaurants,etc.) by now in our homeland, right?

Our successive post-WW2 government administrations, technocrats have had practically made an "open-door" policy to foreigners, mostly "investing" and using local savings since then.

More so, the IMF/WB-WTO "agreements" to which then President Ramos aided by then Senator Gloria Macapagal-Arroyo and his technocrats signed on should have made our country "take-off." did we?

Show me the beef/money, as they say.

- Bert