Piracy is Almost Impossible to Defeat Thanks to the Filipino First Policy

Disney

Let's face it piracy is hard to combat, right? For Filipinos, it's time to be honest that people have been engaged in piracy in some form. It may be pirated video games, CDs, VCDs, DVDs, etc. There are laws passed against piracy. However, one must ask why piracy is so hard to combat. Piracy bypasses through legalities. It's a common practice to have a pirated version of this and that application, because of the price. Installing MS Office and Windows 11 can be costly. It can cost PHP 7,000.00 for Windows 11 Home and PHP 5,400.00 for MS Office. Back in college, people would do anything to get the MS Office and Windows 11 because they needed it for their projects. It doesn't help that some well-to-do boomer are stingy instead of thrifty. It doesn't help either that some people just can't afford to buy the original software--given their income bracket. 

It's easy to raise the Filipino First Policy by saying, "Tangkilikin ang sariling atin!" or "Enjoy our very own!" In the 1990s, I remember how Values Education class even talked about patronizing local products because they're local (read here). Civics textbooks even try to glorify Carlos P. Garcia as if he was a hero because of the Filipino First Policy. In a chilling irony, Garcia's body is now beside Ferdinand E. Marcos Sr.'s body at the Libingan Ng Mga Bayani (Graveyard of the Heroes). What's the use of hating Marcos' protectionist government while loving Garcia? That's why I even wrote an article debunking the idea that Marcos was a "neo-liberal" when he was running a protectionist-based government.

If we take a look at the Filipino First Policy, we can read these words by Garcia:

The ”Filipino First” policy of this administration re­ceived a resounding popular indorsement in the last election. Politically we became independent since 1946, but econom­ically we are still semi-colonial. This is especially true in our foreign trade. This policy is therefore designed to regain economic independence. It is a national effort to the end that Filipinos obtain major and dominant participa­tion in their own national economy. This we will achieve with malice towards none and with fairness to all. We will accomplish this with full understanding of our inter­national obligations towards our friends of the Free World. We will carry this out within the framework of our special relations with the United States to whose citizens we granted until 1974, by Constitutional provision, equal rights as Filipinos in the exploitation of our natural resources and public utilities, and to whom we also granted trading parity rights under the Laurel-Langley Agreement. Under this policy we will welcome friendly and understanding foreign capital willing to collaborate with us in the exploitation of our vast natural resources preferably on joint venture basis.

There are noble intentions. However, aiming that Filipinos should be the majority holders of businesses. The result is that while the Filipino First Policy doesn't prohibit FDI per se--it's still discouraging them from entering the country (read here). Who in the right mind would want to rent a space but they have to give up 60% of their ownership (and therefore, 60% of their net profits) to their lessor (read here)? Some say it's because the profits will go to the FDI. Please, simple accounting will show that the only profits FDIs will keep are from net profit after taxes. I'm afraid that Pinoy Pride Economics is confusing revenues for profits (read here).

The real problem with the Filipino First Policy is that in aiming that Filipino businesses will be the "major and dominant participants, has limited job production. In limiting the job production, one can see the consequences. Some people rally every day asking for #SahodItaasPresyoIbaba--meaning to raise salaries while lowering the prices of goods. I don't need a PhD in economics or business management to understand salaries are part of the cost of production. 

Graph taken from CFI

As we look further into the consequence of Filipino First Policy--it shouldn't require a PhD in economics or business management from Ateneo De Manila or the University of the Philippines, to understand the fundamentals. I wrote an article on the relationship between the supply/demand in the job market with salary rates. If we're going to get into basic details (and this can be taught in middle school and high school), the Corporate Finance Institute gives this detail on salary rates:

Supply and Demand in the Job Market

Similar to the markets of goods and services, job markets also follow the supply-demand mechanism. When the quantity of workers demanded is equal to the labor force available (the quantity of supply), the job market reaches its equilibrium point, and wages can be determined.

The wage level rises when the demand is greater than the supply and lowers when the supply exceeds the demand for workers. However,wages cannot always move freely. There is often a floor determined by the government, which is known as the minimum wage.

When the equilibrium wage is above the minimum wage level, introducing a minimum wage will not lead to a major impact on the job market. When a minimum wage is established at a level higher than the equilibrium wage, the quantity of demand will fall as businesses will instead try to control their labor costs by reducing the number of employees.

The quantity of supply increases as there are more active job seekers motivated by the higher wage level. It forms a gap between supply and demand and thus, leads to unemployment. Despite this drawback, the minimum wage policy can provide both economic and social benefits. By increasing the wages of low-income workers, the government can reduce its spending on social programs to support these individuals and relieve the economic inequality at the same time.

Since the Filipino First Policy has reduced the number of jobs, we can expect the demand for workers to decrease. Workers are also subject to supply and demand. There's more supply of laborers than there is a demand for labor. How can we have a demand for labor? Not all Filipinos are business-inclined. If we say, "Filipinos should just try on their own to establish their own businesses." Can that kind of thinking be done? The late Lee Kuan Yew even stressed that if he waited for Singaporeans to "straighten up" then they would've already starved even further. In short, we can't really just raise or decrease salaries at a whim. Salaries are dictated by the supply and demand in the labor market. People can't change the fundamental laws of economics by insulting others (read here).

The result is that salaries will be low because the supply of labor is high and the demand for labor is low. Let me stress it again how can you expect a higher demand for labor of there are barely any employers? How long will it take for Filipinos to build their own businesses to sustain the Philippines? Even worse, some people are saying that opening the Philippines to FDI will make more Filipinos look for jobs abroad, that foreigners will buy the country, and whatever paranoid claim might suit their fancy. Did what they say happen to the neighboring ASEAN countries? Please, Singapore opened its doors to FDI and got it out of poverty. Some Singaporeans only moved out and went to Malaysia because housing in Malaysia is cheaper. Housing in Singapore is expensive because it's a small city-state! Again, where's the analysis of supply and demand there? Malaysia has a bigger supply of housing because it's a bigger country. Singaporeans aren't moving out because of FDI, as some person I'll dub as Madame Whale. Madame Whale has been interacting with that fat person I dub as Porky Madugo. Porky is too self-absorbed to even look into basic economics

As a result, lower-income people end up buying pirated goods because it's much cheaper. If they bought the original goods--it may rob them of eating three meals a day or their ability to pay rent. Even more, some people are breadwinners who barely can make money. Talk about people who are working for probably 18 hours (or more) just to make ends meet. With piracy being hard to combat, it's time to ask, "Do people really have the money to buy the original goods?"