How Many MORE Unmitigated Typhoon Disasters Before Filipinos Realize That the Filipino First Policy is FAILING Them?!
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For die-hard defenders like Atty. Hilario G. Davide Jr. (who will turn 90 this December 20) or Atty. Christian Monsod (who's 89 this year), they're prone to saying that it's just a matter of implementation. However, whether we want to admit it or not, the 1987 Constitution is built on a series of contradictions. In fact, one of the biggest contradictions ever done within the current law is Article XII of the 1987 Constitution. Sure, we can read this:
Section 1. The goals of the national economy are a more equitable distribution of opportunities, income, and wealth; a sustained increase in the amount of goods and services produced by the nation for the benefit of the people; and an expanding productivity as the key to raising the quality of life for all, especially the underprivileged.
The State shall promote industrialization and full employment based on sound agricultural development and agrarian reform, through industries that make full of efficient use of human and natural resources, and which are competitive in both domestic and foreign markets. However, the State shall protect Filipino enterprises against unfair foreign competition and trade practices.
In the pursuit of these goals, all sectors of the economy and all region s of the country shall be given optimum opportunity to develop. Private enterprises, including corporations, cooperatives, and similar collective organizations, shall be encouraged to broaden the base of their ownership.
However, the big problem is that while it's indeed proper to protect Filipino enterprises, it must be against, again, unfair competition. The introduction is pretty noble, but it creates one huge problem, namely continuing and enshrining Carlos P. Garcia's Filipino First Policy, which sadly made it Philippines last in ASEAN. These idiots say, "It's just corruption! Let's get rid of the corrupt officials!" Please, it's not just corruption, but also a lack of funding, too! Corrupt officials are the symptoms; the root cause is corruption within the constitution. It's like an outdated antivirus couldn't deal with the latest digital virus!
I dare those who want to enshrine the "wisdom" of Davide and Monsod to prove that it's just a lack of implementation. It's like that, some certain annoying fat guy I ran into on Facebook even said, "If you want to know what's best for the Philippine economy, ask the Monsods, not some foreigner." How ironic to be saying that statement on Facebook!
A failure to understand why other countries are doing better
It's crazy, but some people's virtue signalling on social media (Facebook and Twitter, for example), is saying, "Oh, Japan is so much better! Japan has its underground cathedral!" However, I start to say that even if Japan's constitution is still the 1946 constitution, it doesn't contain the overly restrictive provisions of Article XII of the 1987 Constitution of the Philippines! Please, Japan has long abandoned imperial control, the Tokugawa Era (during the time when Japan was in an isolationist state, until the Meiji Era), and it's a foreign investment-friendly place. Japan is far more friendly to FDI than the Philippines, as any protectionist measures are only through legislation, making it easy to set up measures like tariffs as only legislative. That means when Japan restricts the economy, it's through legislation, not a permanent fixture in the constitution!
The same goes for Vietnam and its flood control. Some may say that Vietnam is an example of the success of self-industrialization. However, Doi Moi's history has proven that wrong! I don't need a PhD in economics from the "elite universities" like Ateneo De Manila or the University of the Philippines to understand that Vietnam didn't self-industrialize. I don't need a summa cumlaude either, given the poor quality of education in the Philippines! Vietnam's aggressive pursuit of FDI has allowed better funding for flood control projects. Vietnam's aggressive pursuit of FDI without the ridiculous ownership restrictions made it more favorable for FDI than the Philippines' highly restrictive, overpriced rent model!
However, the Philippines is still "nganga" (mouth open) because it only blames corruption, but doesn't see beyond corruption
I'm not saying we shouldn't pursue investigations of substandard flood projects. What I'm saying is that while corruption is indeed a problem, the Filipino First Policy has caused us, again, to be more left behind and more corruption to fester. When you leave power in the hands of a few--you are really encouraging corruption. Sure, one could say that Carlos P. Garcia, the poster boy for the Filipino First Policy, created the Presidential Anti-Graft Committee. What good did it do if it comes to conflict with power in the hands of a few? In doing so, it has allowed corruption to fester, because cronyism becomes more or less, the inevitable result.
As we look into it, the Filipino First Policy, by demanding a 60-40 overpriced rent model, has significantly caused supply to go down, and the demand to still steadily increase. This has also caused an outdated technology. As Andrew J. Masigan stated in the Philippine Star, this should be a somber warning:
I would never undervalue the 1987 Constitution. It dismantled the legal framework of a repressive regime and established the democratic institutions we enjoy today. For this, I am grateful.
The 1987 Constitution was crafted with the best of intentions. It sought to put the Filipino first in all aspects of governance and to level the playing field amongst sectors and peoples. But it is far from perfect. It failed to consider the importance of foreign capital and technologies and the stiff competition we would have to face to obtain them. In short, its economic provisions were short-sighted.
So despite the Constitution’s patriotic bravado, reserving certain industries exclusively for Filipinos (or a Filipino majority) worked to our peril. It deprived the nation of valuable foreign investments, technology transfers, tax revenues, export earnings and jobs.
The Constitution’s restrictive economic provisions stunted our development for 36 years. From 1987 to the close of the century, Singapore, Malaysia and Thailand leapfrogged in development on the back of a deluge of foreign direct investments (FDIs). During that period, the Philippines’ share of regional FDIs lagged at a pitiful 3 percent in good years and 2 percent in normal years.
From the year 2000 up to the present, Vietnam and Indonesia took their fair share of FDIs, leaving the Philippines further behind. The country’s intake of foreign investments is less than half of what Vietnam and Indonesia realize. No surprise, our exports have also been the lowest among our peers. The lack of investments in manufacturing capacities have left us no choice but to export our own people.
Imbedded in the Constitution are industries in which foreigners are precluded. These include agriculture, public utilities, transportation, retail, construction, media, education, among others. Further, the Constitution limits foreigners from owning more than 40 percent equity in corporations. Foreigners are barred from owning land too. These provisions caused us to lose out on many investments which would have generated jobs, exports and taxes. Not too long ago, we lost a multibillion-dollar investment from an American auto manufacturing company that chose to invest in Thailand instead. We lost a multi-billion smartphone plant by Samsung, who located in Vietnam.
Sure, the Public Service, Foreign Investment and Trade Liberalization Acts were recently amended, allowing foreigners to participate in a wider berth of industries with less rigid conditions. But it is still not enough. The Philippines remains the least preferred investment destination among our peers.
Our flawed economic laws are the reason why our agricultural sector has not industrialized and why food security eludes us. It is also why our manufacturing sector has not fully developed. It is why we lost the opportunity to be Asia’s entertainment capital despite our Americanized culture (Netflix located its Asian headquarters in Singapore, Disney in Malaysia, MTV in Hong Kong and Paramount Studios in Taiwan). It is why our education standards are among the lowest in the world. It is why many industries are oligopolies owned by only a handful of families.
It may be best to ask ourselves questions like, "Would we rather let Filipinos drown, waiting for a Filipino to save them from a flood, than to accept that we may need foreigners to save Filipinos from drowning?" It's because many times, a lot of irrational decisions are made with Pinoy Pride Economics rather than practical logic.
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