Yesterday, I wrote on the topic of the foolishness of wanting more affordable and better services while rejecting the need for foreign investors (read here). I would've wanted to take it a bit easy today but I felt that I needed to write this topic. This time, I felt like writing about the irony of demanding jobs while rejecting economic liberalization. Accepting foreign direct investments (FDIs) doesn't mean the economy solely relies on foreigners (read here). Instead, we're talking about mutual participation where both FDIs and local investors have their friendly competition.
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| Migrante International |
The irony of groups like Migrante International (above) is how they demand job creation at home and junk labor export. However, their kind (which also includes the likes of Bayan Muna, Kabataan Partylist, and League of Filipino Students) are still opposed to foreign investments. It made me laugh and cringe at the same time when the League of Filipino Students' spokesperson, Carwyn Candila, condemned the Public Services Act of 2022. Sarah Jane I. Elago of Kabataan Partylist also did the same. Neri Colmenares and Teodoro Casino continue to spread lies about FDI. There have been many scare tactics (read here) that can now be easily refuted even if I didn't get an MBA last 2014.
However, when these people are asked, "How do you want jobs to be produced? I've tried giving comments on their videos. Many times, either they can't give a solution or they give a solution that's not economically sound. I really must laugh or cringe at the silence or when they give their "solutions" that aren't solutions. One such solution is all about the demand for higher salaries, lower prices of goods, and handouts for everyone (read here).
Neither the local government nor the local investors are enough to produce the jobs demanded
It's often said that a nation must protect its industries. I remembered a Facebook page calling itself Heneral Luna. I really must laugh at the idea that first-world countries developed by protecting small businesses to create that "national industry". The view that we must let our businesses mature at first plan fails. The late Lee Kuan Yew stated in his book From Third World to First totally defeats that idea. Instead, we find these words on page 66 of the said book:
Our job was to plan the broad economic objectives and the target periods within which to achieve them. We reviewed these plans regularly and adjusted them as new realities changed the outlook. Infrastructure and the training and education of workers to meet the needs of employers had to be planned years in advance. We did not have a group of readymade entrepreneurs such as Hong Kong gained in the Chinese industrialists and bankers who came fleeing from Shanghai, Canton, and other cities when the communists took over. Had we waited for our traders to learn to be industrialists we would have starved. It is absurd for critics to suggest in the 1990s that had we grown our own entrepreneurs, we would have been less at the mercy of the rootless MNCs. Even with the experienced talent Hong Kong received in Chinese refugees, its manufacturing technology level is not in the same class as that of the MNCs in Singapore.
The very statement of Lee really makes sense. Singapore was in really bad shape. There were hardly any traders who could reach industrialist status. Plus, Lee really called the school of thought of protectionists to be a third-world mentality. Reading the book From Third World to First has been rather enlightening. I really agree with Lee's stated fact that protectionism is best left as a third-world mentality. If the Philippines expects to junk the labor export policy--it needs to end its protectionist regime!
Besides, we need to take a look at Filipino entrepreneurship. There are not enough Filipino businessmen who can generate jobs. Is there really a guarantee that everyone who passes through a Conditional Cash Transfer (CCT) program will ever become an entrepreneur? There are limits to the CCT program. CCT programs have a time limit. What happens is that some beneficiaries of a CCT program may have to fly abroad to look for a job due to the lack of jobs in their home country. Also, trying to force as many Filipinos to become businessmen can be as fatal as Mao Zedong's Great Leap Forward. Mao's program to try and create jobs only failed. Some people will remain poor even after the CCT program if they don't do their part either. It's because CCT programs will never create jobs. It's only an extension where the government helps the poor within a timeframe.
As Lee said, let's stop trying to do everything ourselves. Lee invited MNCs to be part of the Singaporean business environment. Deng and Do Muoi both did the same thing. As Kishore Mahbubani says in the VRPO documentary, The Singapore Economic Model, foreign investors create jobs, bring in capital, and teach new skills. It's all about filling in the gap. Besides, local investors too can benefit not just by by learning from competition but by benefiting from more services, suppliers, and customers (read here).
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