Is Your Best Source that FDI is Bad... CHISMIS?

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A few days ago, I wrote an article where I talked about whether or not the best source for anti-reform Filipinos is well—chismis? This time, with the news from Business World that Taiwan plans to build a $1-B plant in Clark City, I felt the need to write a "follow-up" to my article on the best source being chismis. 

THE Bases Conversion and Development Authority (BCDA) said company is building a $1-billion manufacturing facility in New Clark City (NCC), Tarlac.

The agreement has been signed and an advance payment was made, BCDA President and Chief Executive Officer Joshua M. Bingcang told reporters last week.

He said the facility will be located within Filinvest Innovation Park in New Clark City, Tarlac, making it one of the biggest locators in the estate.

Mr. Bingcang said the facility will specialize in technology-related manufacturing, without providing details or identifying the company.

However, this article will not focus on the business opportunity with Taiwan yet, until the name of the firm or company is released. Instead, my focus would be on attacking one of the favorite sources of the marites crowd. I even remember writing about the MARITES School of Business and Economics. This time, I want to ask whether or not the best sources that people get against FDI are actually generated by one common line—chismis!

Examining the sources of chismis against FDI 

It's easy to say that, "Well, we have our sources." We have the Just Because Fallacy, which is described as:

(also known as: trust me, mother knows best fallacy, because I said so, you’ll see)

Description: Refusing to respond to give reasons or evidence for a claim by stating yourself as the ultimate authority on the matter.  This is usually indicated by the phrases, “just trust me”, “because I said so”, “you’ll see”, or “just because”.  The just because fallacy is not conducive to the goal of argumentation -- that is coming to a mutually agreeable solution.  Nor is it helpful in helping the other person understand why you are firm on your position. “Just because” is not a reason that speaks to the question itself; it is simply a deflection to authority (legitimate or not).

It can start with parents establishing their authority because they are the parents. If anybody used to believe Santa Claus exists, the "best source" was the parent, right? This is also the fallacy of appeal to authority.  The same goes when people play the credentialist fallacy when convenient. For example, they start citing their favorite echo chamber sources, such as:

1. The constitutionalists, such as Atty. Hilario G. Davide Jr. and Atty. Christian Monsod. Or for economics, Atty. Monsod's wife, Prof. Solita Collas-Monsod! This made me ask a rhetorical question about whether or not Filipinos should only rely on local economists.
2. The IBON Foundation, which I just can't take seriously as an economic think tank.
3. Makabayan Bloc, such as Bayan Muna Partylist members (examples are Teodoro A. Casiño, Atty. Neri Colmenares), Kabataan Partylist, League of Filipino Students, and Gabriela Women's Partylist (where Rep. Sarah Jane Elago is now, due to age), to name a few. 
4. Maybe I should also include the most absurd source, which is from the Catholic Bishops' Conference of the Philippines. I usually understand that the majority of Filipinos are Roman Catholics. However, I must gag whenever someone like Bishop Broderick Pabillo or Bishop Socrates Villegas is mentioned; they are best considered the Padre Damaso School of Business and Economics. So much for credentialism! In fact, I even have to laugh it off whenever they tell me that they heard FDI is bad, from a Filipino Catholic priest. 

Taking a closer look at IBON as to why I can't really take them seriously, as a business administration graduate

I thought about this claim by IBON, by its executive director, Jose Enrique "Sonny" Africa, and honestly, if only he could back up his claims:

Rebel nation

Economic Cha-cha flat-earthers insist that Philippine economic progress depends on revising the Charter. However, it isn’t the Constitution that is the binding constraint to progress. The much bigger problem is that economic policymaking is fettered by obsolete free market globalization paradigm and does not have a vision for national industrialization.

The nationalism of the 1987 Constitution was exactly what the economy needed when so-called free market globalization started getting underway in the 1980s. The protectionism and state interventionism in South Korea and Taiwan, for instance, were by this time already bearing development fruit.

The charter’s call for a self-reliant and independent economy could have been an effective measure for developing Filipino industry. Instead, the economy kept on being opened up to foreign trade and investment which caused manufacturing to fall to its smallest share of the economy in 75 years and agriculture to its smallest in the country’s history.

The Constitution wisely called for industrialization and gave the means for this such as protection of Filipino firms, regulation of foreign investment, agrarian reform and rural development, and more.

Unfortunately, consecutive administrations bought into the globalization hype and went in the other direction. They spent more time finding ways to subvert the nationalist economic provisions instead of implementing them. This hollowed out the economy and is the reason for such chronic joblessness, poverty and underdevelopment.

The 36-year-old Charter recognized the need for active government intervention to transform the economy’s structures and make it more industrialized, equitable and sustainable. It doesn’t need to be updated and is more relevant than ever. If anything, it’s the series of laws passed to subvert the nationalist and protectionist spirit of the Charter’s provisions that need to be changed.

The 1987 Constitution’s foreign investment restrictions are time-honored and in no way obsolete. This is why so many other economies in the region still have foreign equity restrictions in ordinary law. Unlike in other countries, the drafters had the boldness and confidence to hard-code these in the Constitution. What they didn’t foresee though is the determination of economic Cha-cha flat-earthers and their creativity in using ordinary laws to bypass the charter.

The Marcos clan’s Cha-cha offensive today is driven by the arrogance of power. The effort of every president that has tried to extend his or her hold on political power always floundered as the people and the public stood firm. There’s every reason to expect that similar defiance today will be as successful in blocking what is ultimately just petty and self-serving ambition.

This is crazy that IBON still acts like the constitution isn't the problem. Also, we need to realize that South Korea and Taiwan didn't become economic powerhouses through some autarky model or nationalistic pride. In fact, history has proven that South Korea and Taiwan didn't develop through hardcoding protectionist measures in the constitution. Instead, South Korea and Taiwan use legislative measures. Neither South Korea nor Taiwan has economic restrictions within their individual constitutions! Any protectionist acts, like tariffs, are put under legislation. After all, protectionism is sometimes needed when the country gets overheated from too much economic activity. 

Closing words

If the best source against FDI is IBON (or any of the other sources like Davide, Monsod, Bayan Muna, etc.), then all I can say is, "No thanks!" It's been the same echo chamber for many years. Empirical evidence is necessary in research. A Blogspot or WordPress post that has cited several different sources to defend a stand is better than a paid domain website that just writes random nonsense. 

Honestly, I'm better off reading books written by the likes of Mahathir Mohamad (condolences to him for being widowed recently), the late Lee Kuan Yew (who wrote the book From Third World to First), Kishore Mahbubani, or, for local sources, I have a huge respect for Filipino economist Andrew James Masigan, as he saw the need for economic charter change.