Skip to main content

The Irony of Getting Mad at Agricultural Imports Then Complaining About Inflation of Agricultural Goods


I really must laugh at the stupidity of "thought leader" pages or the comments on Facebook. A good example is the one above where Rosendo So says that onion importation could've prevented the price surge of onions. However, just reading the comments (and there's so plenty I wouldn't bother replying to them all) keep demanding protectionism for local farmers. The illogical stupidity of the comments proves one thing--there's still a significant surge of economic illiteracy in the Philippines. What do you expect from people who demand stuff like higher wages while lowering the prices of goods? Simple cost accounting dictates that wages are part of the production process. If you start raising up prices then you can expect the prices of goods to increase as well. They even don't bother to analyze the supply chain along with operational costs as well.

I don't need a doctorate in economics to get it. Okay, I'll confess that I had a graduate degree from the School of Business and Economics (SBE) from the University of San Carlos (USC). I had three units of economics during my Associate in Computer Science (ACS) days. I had a total of six units of economics during my Bachelor of Science in Business Administration (BSBA) days. I had three more units during my Masters in Business Administration (MBA) days. Still, it's taught in basic economics that the law of supply and demand dictates it. If supply is low and demand is high then prices must go up. If supply is high and demand is low then prices must go low. It's all about regulating the free market. Also, if businessmen sell low during the high demand and low supply scenario--that would mean they'll have t close down sooner or later.

It's true that the Philippines is an agricultural country. However, if a country must export then it must also import. There are planting seasons and harvesting seasons. If it's not harvesting season then you can't force local Filipino farmers to speed up the process. Much care must be done by Filipino farmers to make sure their plants grow well. The obvious solution is to import. Somebody can argue Singapore must rely on imports because of its lack of natural resources. However, times of scarcity will hit. One country may have an excess while another has a scarcity. That's why it's important to have imports during scarcity and exports during excess.

I was reminded of times of drought. Back then, I had no idea why rice merchants had to sell imported food. Wouldn't that be detrimental to the local farmers? However, if rice merchants didn't buy imported rice (such as from Thailand and Vietnam) then they'd be focused on selling local rice at a very high price. Nobody would want to buy expensive local rice. Instead, people would opt to eat cheaper imported rice. The same goes for onions and other spices. If local Filipino merchants imported spices then they'd have something to sell. If there was an import of agricultural products then Filipino businesses can benefit. They will have more affordable items to sell or make their products with. A dessert maker could still produce rice cakes even if the rice was from Thailand or Vietnam. A bakery can still benefit from imported flour to make Filipino bread. 

An article I wrote was about if Filipino businessmen used imported equipment and materials (read here). It's because when I look at many booming local Filipino businesses--they're obviously using imported equipment. Don't tell me that Jollibee prospered without using imported stuff? Don't tell me local groceries can go on without selling imported stuff? So what if Filipinos actually used imported onions and garlic to cook a Filipino dish? Does that make the dish less Filipino? It wouldn't and I could care less if the stove wasn't made in the Philippines. What's important is that the Filipino dish was made with quality ingredients and equipment. There will be a mixture of local and imported. One could be cooking delicious pochero (Filipino beef stew) with beef imported from New Zealand, tomatoes from local farmers, ginger from Bicol, onions from Vietnam, and on a stove made in Japan. It's still delicious pochero nonetheless! It's still a Filipino dish and the imported ingredients didn't make it "less Filipino". 

The issue with imports is basically this. Filipino farmers need time to raise and grow their crops during planting season. Importing agricultural products isn't a threat to local industries. It's more about introducing competition plus balancing supply and demand. If there's a scarcity of local agricultural goods then importing is necessary. If there's an excess then exporting is the solution. The Philippines needs to stop babying its industries. Instead, let them grow with competition. 

As Deng Xiaoping would say, "It's not the issue of the cat being black or white. What I care about is the cat catches mice." Mao Zedong restricted a lot of imports and tried to create a protectionst utopia. I bet nobody abroad bought his inferior rice. The self-industrialization policy failed. As the late great Lee Kuan Yew said, "Let's stop trying to do everything ourselves." This is why I support removal of unnecessary tariffs. The only taxes I believe that foreign investors need to pay are income taxes. Let's stop crying, "Filipino First!" all the while it's done on American-made social media like Facebook or Twitter. 

Labels:

Popular posts from this blog

Venezuela as a Cautionary Tale on #SahodItaasPresyoIbaba, Nationalistic Pride, Welfare State Economics

The Sunday Guardian Years ago, I wrote about Venezuela's pride and protectionism , under a more "formal" style of writing compared to my latest posts. I decided to use an even "less formal" and "less academic" tone since I'm not writing a term paper. Instead, it's like how a professor and a student discuss the thesis using first person over third person, using contractions, etc., while the thesis doesn't use such tones. Back on track, I thought about the arrest of Venezuelan President Maduro can spark debate. Was it a violation of sovereignty? I'm no expert on international law. However, Venezuelans can be seen celebrating Maduro's arrest. Right now, I'm using Gemini AI and Google search to help me find some sources for this blog. It's because I don't want my blog to become another gossip central, but a place to discuss facts with my own personal opinions (making sure they don't  derail the facts).  I used Venezuela ...
Read more

Venezuela's Pride and Protectionism

The Telegraph Venezuela is an oil-rich country yet it's a very poor country. Somebody could go ahead and give every unthinkable reason such as "foreign investments caused it" (a blatant lie) and "It's because America had economic sanctions in Venezuela". Yet, the answer can be found in several causes such as corruption. Yet, China and Vietnam, which can be seen to still have a good amount of corruption, are far more successful. The answer also lies in one policy--economic protectionism . The very idea that a country that first world countries used "protectionism" to succeed is a lie as proven by Venezuela's ongoing crisis. A common-sense examination of one root cause of Venezuela's continuing crisis Forbes magazine mentions this in "What Do Investors Need To Understand About Venezuela's Economic Crisis?" by Nathaniel Parish Flannery on December 21, 2016: Venezuela is far and away the worst-managed economy in the Americas . Ad...
Read more

Davide vs. Mahathir: Which Lolo Should Filipinos Take Economic Advice From?

The real issue isn't that something is old or new. Instead, if something old or new still works, or doesn't work! Many modern laws are built on some ancient principles, while adjusting to the current times!  The Constitution of Japan is actually older than the 1987 Constitution of the Philippines. However, it's more effective for the reasons that (1) their constitution is silent when it comes to regulating economic activities (ex., protectionist measures), and (2) it's a parliamentary system. Honestly, it's a pretty straightforward constitution compared to ours! As Mahatir Mohamad turned 100 today, I would like to raise up Atty. Hilario G. Davide Jr. once again. The problem isn't Davide's age but his unwillingness to embrace change when needed (read here ). This time, it's time to bring up a contrast between wise old people and unwise old people. A young person can be right where the old person is wrong. A young person can be wiser because he or she lea...
Read more

From Lying About the Marcos Years Parliamentary System to Marcos Years Economic Liberalization?

Manuel L. Quezon III"s Twitter Account The first issue I've had is people saying on social media, "No to the parliamentary system because the first Marcos Administration was parliamentary!" It's really something because such people never bothered to do any further research. Please, knowledge isn't that expensive! Benigno Simeon "Ninoy" A. Aquino Jr. even stated, "We had a parliamentary form of government without a parliament." Later on, even Ferdinand E. Marcos Sr.'s own words showed that the Philippines was still presidential . Why would people still insist that it was a parliamentary form of government? Even more, I'm not surprised that some people are saying on Facebook, "Economic charter change is all about term extension." Even worse, it can be from the Philippine mass media. Sadly, the late Lee Kuan Yew was right to fall the Philippine press rambunctious in his book From Third World to First . I can refer the book t...
Read more

Ironically, COMMUNIST Vietnam Continues Improving FDI Conditions, Compared to DEMOCRATIC Philippines

Vietnam National University It's crazy how people don't realize the bigger picture between Communist Vietnam and the democratic Philippines (read here ). It's really crazy how Senator Joseph Victor Gomez Ejercito apparently thinks that delayed proceedings to Vice President Sara Duterte-Carpio's impeachment trial could scare away FDIs. Meanwhile, Atty. Renee Louise Co of Kabataan Partylist could talk about economics, all the while Kabataan Partylist is still against open FDI. It's amazing how Raoul Abellar Manuel, a cumlaude in applied mathematics, still believes in #SahodItaasPresyoIbaba economics! Meanwhile, the biggest picture is that Communist Vietnam , while it's under a One-Party State of the Communist Party of Vietnam, is has the better picture of how to invite FDIs. In fact, the Constitution of Vietnam  is rather silent on economic restrictions . The CPV chooses to impose economic restrictions through legislation rather than enshrining them in its Constit...
Read more