Early last week I read an article by a local political analyst Mr. William Esposo of the Inquirer-GMA 7 website and found it initially repugnant. Since your prudent investor analyst do not want to succumb to confirmation biases, with an opened mind I digested the thesis that the Philippines is in an advance state of anarchy let me quote some important quips of Mr. Esposo’s arguments:
“The lethal combination of the most extreme poverty and runaway consumer prices, graft and corruption, public disillusionment over the political system coupled with the total absence of an inspiring leader-model and topped with an all-encompassing fiscal crisis lead to only one conclusion: we are headed for a period of anarchy…
“I’ve said in previous columns that this nation is already in revolt, in the psychological sense. In contrast to our previous political crises, people have become too disenchanted to even see hope in the changing of the guard. The people want a system overhaul. The yearning to change the system becomes even more intense as the pressures mount….
“More and more people I talk to have told me that they find an authoritarian regime an acceptable alternative to the present system. In his column several weeks back, my friend and Inquirer columnist Randy David wrote about Washington Sycip and F. Sionil Jose expressing support for an authoritarian regime and a revolution, respectively. Five years ago these mild-mannered gentlemen would have found these radical views unthinkable.
Writing as an investor, for a state that is on an initial phase of ‘revolt’, as Mr. Esposo suggests definitely is unworthy of investments. But is the country truly in a state of anarchy? Or is anarchy simply confined to the mindsets of political analysts with blinders and experts banking on controversial hugging headlines? While it is true that problems such as extreme poverty graft and corruption, public enchantment does exist, does this suggests that the
Well for Mr. Esposo arguably it is, hence their radical call for an authoritarian regime. This is sharp contrast to what foreign analysts think of our economic health as I have shown you lately. Warts and all analysts from Credit
“Wealth distribution in
On the plus side Mr. Lian cites of a possible domestic investment boom which is of course is virtually impossible to the likes of Mr. Esposo. Mr Lian says, “Both Malaysia and the
Morgan Stanley is bullish on Asia and the Philippines not only in its outlook but it puts its money where its mouth is according to Bloomberg’s Hui-yong Yu “Morgan Stanley, raising $3 billion for its fifth global real estate fund, got a commitment of as much as $440 million from Washington state’s pension fund to invest in Asia and Europe… Morgan Stanley…is betting on economic recoveries in Asia and
In addition the latest news is the mining front is that Dr Marc Faber who sits in the board of Canadian Mining Ivanhoe Mines is in talks with local mining heavyweight and
Now if the
To suggest the likelihood of the return of authoritarianism is equally revolting. Name me a Latin American country (which has patently a similar culture to the
The usual argument for a return to authoritarianism is predicated on virtuous of discipline and central control. And this is premised largely on model leaders that would be ideal or in Mr. Esposo’s words ‘inspiring leader model’. And in most occasions, the premier model would be Mr. Lee Kwan Yu of
The best parallels could be seen with Indonesia which also underwent a plentiful horrid years of Dictatorship (1967-1998), yet if one notices in economic terms according to World Bank 2002 the Philippines ranked 133rd against Indonesia’s 145th based on GNI Atlas methodology per capita income, as measured in Purchasing Power parity the Philippines ranked 126th against Indonesia’s 140th.
In terms of corruption according to Transparency International the
The additional list of most corrupt leaders includes Mobutu Sese Seko of Zaire, Sani Abacha of Nigeria, Slobodan Milosevic of Serbia/Yugoslavia, Jean Claude Duvalier of Haiti, Alberto Fujimori of Peru, Paulo Lazarenko of Ukraine and Arrnoldo Aleman of Nicaragua. Now note, most of these most corrupt leaders were tyrants. In other words, authoritarianism breeds corruption rather than slays them. Corruption under an authoritarian regime is and has been the rule and their much touted
In terms of Business conduciveness, World Bank’s Doing Business shows that the Philippines has a more attractive business environment COMPARED to Indonesia it takes 25 procedures 380 days and costs about 50.7% as percentage to debt to set up a business in the Philippines compared to the Indonesia’s 34 procedures 570 days and 126.5% of costs. So if there was any country that needed a revolution it would have been
And for one to believe that a country can emerge as immaculate is delusional according to Director of Global Governance at the World Bank Institute, Daniel Kaufmann, “there is no such thing as zero corruption, even in countries that rate at the highest levels in terms of ethics and the control of corruption.” This not to mean that your analyst would be tolerant of these malfeasance this is to say that reforms are required and not some iconoclastic actions that would exacerbate rather than alleviate our present predicament.
But of course, these local revolution inciting analysts have their self-serving agenda, either they bear an irresolvable personal difference with the present administration or they seek other agendas such as outmoded left leaning political paragons or have personal interests on an alternative government or are simply dolts engaged in oodles of tarradiddles.
Finally I would like quote Mr. Lew Rockwell of the Ludwig Von Mises Institute about the corruptions of governments, “In a free market, big isn't the same as corrupt or inefficient. Bigness is the reward of market success. If you give the consumers a good product or service at a price better than the competition, your business tends to grow. No matter how large the firm, its managers are always accountable to the public. Moreover, no market position, however exalted, is permanent. Private business must earn its keep every day, or suffer losses and even bankruptcy. This is what makes market institutions accountable; the watchdogs of the system are investors and consumers with their own property at stake.
“In government, the opposite is true. Big and corrupt go hand in hand. The worse the government is, the more it grows at public expense. So long as the coerced revenue pours in, government can disregard the public interest, and go about its usual business of rewarding its friends and punishing its enemies. Rules, regs, and whistle-blowing that attempt to keep conflicts of interest at bay work about as well as prison bars of thread. For mankind has never discovered a method for keeping the robber state from acting according to its nature.”
To diminish corruption we need less government not more.
For a sample of the horrors of Authoritanism read the Economist article about Myanmar "Forced and other customs"