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 learned from a wise old person!

If there's one thing worth noticing, it's that anti-reform boomers have been quoting Davide (as well as others like the Monsods) to defend their stand. If not them, they may also be quoting from the mouth of a CBCP priest. I'm not saying that the CBCP has no right to talk or criticize the government. However, the problem is that many Catholic priests, who are CBCP members, don't really bother to do research before opening their mouths! As the saying goes, the empty vessels make the most noise. I could expect circular reasoning that the CBCP will tell me to ask the 1987 Constitution framers, then the 1987 Constitution framers will tell me to ask the CBCP. Well, wait, don't they have any other sources to defend their claims, but each other? Talk about being stuck in an echo chamber!

Some time ago, I wrote an essay where I addressed choosing between Davide and Kishore Mahbubani. Why did I pick Mahbubani? IMHO, CoRRECT Philippines' contrasting Davide with the late John Gokongwei Jr., is apples and oranges. Gokongwei isn't a lawmaker, while Mahbubani is a public policy maker. Mahbubani is also the founder of the Lee Kuan Yew School of Public Policy, at the National University of Singapore. After Mahbubani, Davide should also be compared to Mahathir. Why did I select Mahathir? It's not necessarily because Mahathir is older. It's because Davide and Mahathir are old men beyond 80 years old. Davide is still known to be attending events even in his late 80s, and he's almost 90. Mahathir made a "grand comeback" at 90 years old, as Malaysian Prime Minister!

Davide's statements on FDI are hilariously out of the league

Back in 2018, Davide actually tried to defend the 1987 Constitution of the Philippines, to be the "best in the world". However, what comes out of Davide's mouth, is just out of his mouth, without anything to validate what he just said! What made me laugh so hard (and cringe at the same time) was when Davide mentioned that the Philippines could become a "colony of foreign businessmen" (and he told that to ANC, part of ABS-CBN family), and he couldn't cite any proof whatsoever!

MANILA - The provisions of the Constitution on foreign ownership should remain because amending it may lead to the Philippines being a "colony" of foreign investors, a former chief justice said Monday.

The Philippines has "one-fifth of the richest natural resources" and it was "designed that it should only be for Filipinos," said Hilario Davide Jr., a member of the commission that crafted the 1987 charter.    

"If you remove the Filipino citizenship requirement in the exploitation of natural resources, on the acquisition of public lands, or even in mass media, in education, you remove the solemnity of nationalism," he told ANC's Headstart.

Davide said lawmakers should be guaranteed to be incorruptible because Congress can be prevailed upon by foreign interests in order to favor exploitation of the country's natural resources.

"One country may have businessmen so strong because they have the money. If you are in Congress, there might be a temptation to agree to certain propositions, to reduce the limit, for instance, of Filipino participation and increase the participation of foreigners," he said.

"In the end, we will become a colony of businessmen of other countries," he added.

Davide said the 60-40 foreign equity ratio should stay also because the Philippine population is growing annually and they should have food security.

"What will you feed the people afterwards if all our assets here, natural assets, would be [granted] to foreign investors?...Congress should stick to it [60-40] and fully implement the same," he said.

The Constitution restricts ownership of certain areas of investments to firms with at least 60-percent Filipino capital.

The restriction also covers exploration, development, and utilization of natural resources through co-production, joint venture, or production-sharing agreements with Filipino citizens, or corporations or associations.

What Davide said is laughable. If ever Davide tells me, "Why not ask the CBCP?" then the chances are the CBCP will throw me back to Davide! I'm laughing, thinking about how Davide's statement reeks of ignorance! I wonder if Davide would have the nerve or guts to fly to Singapore (if his doctor permits), look for Mahbubani, and tell Mahbubani that? Would Davide dare to approach Mahbubani with that, if ever Mahbubani decided to visit the Philippines for an important trip, or even just for a vacation? I could imagine Mahbubani running into Davide at some hotel in Cebu, and Davide tells him what he just said to ANC. Mahbubani would startle and say, "Well, where's your proof? Look at Singapore!"

However, Mahathir, the old man, who never stopped learning, would beg to differ

I might need to buy Mahathir's book A Doctor in the House, before he passes away. Then again, I read From Third World to First sometime after Lee Kuan Yew died in 2016. I would like to give some quotes from Mahathir, the architect of Malaysia's economic book.

From page 308:

Nevertheless the increase in foreign investments helped to create jobs and so lowered the unemployment rate, which was high at the time. Our approach differed from those of Japan and Korea, where the preference was for acquiring foreign technology for investment by the locals. We did not have local entrepreneurs with the money or the willingness to invest in industries they were not familiar with. It was only after many years that the Malaysians acquired the knowledge and industrial skills to invest in manufacturing. Thus it was through FDI that we succeeded in converting our agricultural economy into an industrial economy and eventually solving our unemployment problem.

From page 334:

Managing a manufacturing industry is very difficult and there was no substantial industry in Malaysia at that time that we could take our lessons from. We went for foreign investments because we did not have locals who were willing to take the leap. Locals wanted to stay within their comfort zones. When there is no competition in the mix, it is easy to get away with low quality, bad management, dirty processes and inefficiency. But in a competitive environment, you must always be on guard. You have to look for ways to improve your product and be more cost-efficient. If you do not, you can be very sure that your competitors will be doing exactly that. Tax protection may provide some comfort but it should not make things too easy and discourage effort. It should certainly not cultivate bad attitudes and habits.

From page 372:

Creating jobs, especially by implementing policies that encourage the creation of private sector work opportunities, is the proper role of government. That was why when Malaysia invited foreign investment, we did not insist on immediately collecting taxes. We were prepared to forgo taxes if the investors created jobs for our people. In our view, no one who was prepared to work should remain unemployed. In fact, the Government was so successful in creating jobs that there are now more than two million foreign workers in the country. We cannot ourselves meet the demand for labour that our economic development has generated.

The difference between the Philippines, post-EDSA (which was still damaged by the first Marcos Administration), and Malaysia was in the economic policy.  Unfortunately, this part of Article XII is still built on Pinoy Pride Economics:

Section 2. All lands of the public domain, waters, minerals, coal, petroleum, and other mineral oils, all forces of potential energy, fisheries, forests or timber, wildlife, flora and fauna, and other natural resources are owned by the State. With the exception of agricultural lands, all other natural resources shall not be alienated. The exploration, development, and utilization of natural resources shall be under the full control and supervision of the State. The State may directly undertake such activities, or it may enter into co-production, joint venture, or production-sharing agreements with Filipino citizens, or corporations or associations at least 60 per centum of whose capital is owned by such citizens. Such agreements may be for a period not exceeding twenty-five years, renewable for not more than twenty-five years, and under such terms and conditions as may provided by law. In cases of water rights for irrigation, water supply, fisheries, or industrial uses other than the development of waterpower, beneficial use may be the measure and limit of the grant.

There are still people who keep praising the late Carlos P. Garcia, as if he were the "greatest president ever". However, the Filipino First Policy had only built foundations that would help worsen corruption. If there was any success in Garcia's anti-corruption campaign, it would be short-lived. The Filipino First Policy held back the Philippines. Another difference is that that the Malaysian constitution, which is again older than the 1987 Constitution, however, doesn't contain the ridiculous provisions of Article XII. Even some senile old man I ran into on Facebook, who thinks forms of government don't matter, still believes in deleting Article XII entirely. It's because protectionist measures should only be in legislation!

Mahathir didn't just say it, but he spoke it from experience. Alex Magno of the Philippine Star is right to say that Mahathir doesn't offer advice from an ivory tower. Mahathir had long been involved in seeing Malaysia rise to become an Asian Tiger. Unfortunately, the late Fidel V. Ramos' plans for a sustainable tiger economy failed. Ramos wanted charter change, but it was demonized. The CBCP probably played a ploy, taking advantage that most Filipinos are Roman Catholics, to get it moving. Again, CBCP has to be such a hypocrite to hate FDIs, but love it when foreigners help their causes, such as letting foreign priests run their parishes! Mahathir showed results, but what about Davide? Davide only talks. Please don't use the late Benigno Simeon "Ninoy" C. Aquino III as proof (read here). Was Noynoy's six-year rule all that perfect? The better question is how you can expect Noynoy's economic plan to really be sustainable when there was still unfinished work in 2016, and Noynoy only had one term? 

Mahathir ruled Malaysia for more than six years straight. Mahatir ruled Malaysia from 1981-2003--as a real prime minister! All the while, the Philippines was under a fake parliament where Cesar Virata was merely the head of the cabinet! Come on, what will ever convince those people that the Philippines never had a parliamentary system? Even funnier is that they quote sources, which actually point out why the Philippines was never a parliamentary system. That's why I post on Facebook that they should tell Malaysia or Singapore their claims. Mahathir was able to create a sustainable plan that would last long, even when he was no longer in power in 19781. Mahathir had a short return, but again, he probably stepped down due to age-related issues. He was 90 when he made a comeback.

Between Davide and Mahathir, my choice is clear. I'm more than willing to listen to Mahathir over Davide. As my late paternal grandmother would say, "Not everyone who grows old, grows old with wisdom." I got the same advice from my late English teacher, who also died of old age. The two showed signs of being left behind by the times. People can become resistant to change the older they get. However, we need to combat that. As Mahathir said, "Never stop learning! (read here)"