Posted tagged ‘poverty’

LAISSEZ FAIRE VERSUS DIRIGISM: PARADIGMS AND FAIRY TALES

December 18, 2014

LAISSEZ FAIRE VERSUS DIRIGISM: PARADIGMS AND FAIRY TALES

Erle Frayne D. Argonza

Across the continents, where markets have predominance in the economic sphere, there has always been the antipodal tendentialities of laissez faire and dirigisme. The bone of contention has been the state’s role in the economy. These tendentialities have surely represented two (2) hard-line oppositional streams.

Mercantilism, the progenitor of dirigism, contended that regulation should govern production, distribution, consumption and exchange. The (interventionist) state should be at the center of regulation, with the central goal of all economic pursuits being the accumulation of the wealth for King. Old Nationalism had held on to this contention, with the revision that wealth should be accumulated for the nation as a whole and no longer merely for the King, wealth that is correspondingly allocated to the folks in the form of wages and welfare (this ‘wealth for nation’ line is admittedly a concession to the Smithian physiocracy, a competitor discourse). Only the state, not the market, can best perform redistributive responsibilities for welfare, jobs and wages. Necessarily, development should be undertaken with strong state regulations in the four intervention areas mentioned. The Keynesian revolution revived the dirigist contention, using a demand-side premise, and held sway across the globe for around half a century since its inception.

Laissez faire, whose earliest articulators were the physiocrats, opposed dirigist doctrines with extreme zeal. Accordingly, the state should only intervene in matters of defense, justice and public works, and should keep its hands off the market. Accumulating wealth is a matter of private sector concern (industrialists and landlords), while free trade must be the condition of international exchange and distribution. Even matters of welfare must be left to market mechanisms to provide. Development efforts, i.e. the ones undertaken by ‘3rd world’ economies, must follow the laissez faire path. The logic behind the contention is that the market will produce the entrepreneurs who will be enticed to embark on bold ventures should they be left on their own to take off ‘infantile enterprises’.

The problem arises when, due to the predominance of non-market mechanisms, such as clientelist relations and redistribution-based exchange systems (haciendas, latifundia), development could hardly take off at all. In cases where entrepreneurs are of residual numbers, such as the one demonstrated by Philippine experience, laissez faire strategies would prove pathetic in results. This entrepreneurial scarcity had justified the adoption of dirigist policy frameworks, the principle ones being those that guided the ‘import substitution industrialization’ of 1947-1968. Various 3rd world states have sponsored the dirigist path, employing diverse models (socialist, mixed market-socialist), with fairly good results for many of them. The articulators of such states have argued that no country had ever prospered thru the laissez faire route, and that laissez faire can only work out when development had reached a highly mature level when consumerism propels growth, and where economic fundamentals are very strong and stable.

Many developing economies actually encountered tremendous snags as their states chiefly sponsored development efforts. Rent-seekers of every kind appeared on the scene, serving as barriers to the effective entry of possible investors from among potential competitors. In the Philippine case, asset reform in the agrarian sector had been a perennial failure, thus further complicating the already complex maize of structural problems. What happened, according to the defenders of laissez faire doctrines, was that dirigisme made the ensconced patrimonial groups become further entrenched, thus leading to a vicious cycle of slow growth, high poverty, high unemployment, and relative stagnation.

Such a situation served as the impetus for embracing neo-liberal reforms over the last twenty-five (25) years by the developing economies, the Philippines included. Laissez faire returned with a vengeance, popularizing free trade in the international sphere, and structural adjustments in the domestic sphere and public sector, to note: liberalization, deregulation, privatization, liberalized currency markets/devaluation, down-sizing, minimal/residual fiscal stimulus & budgets for social services, tax reforms and decentralization. Such a policy regime of ‘structural adjustments’ were instrumental in integrating national markets into a globalized one where there is freer flow of tradable goods, investments, information and labor. Not only that, the antipathy of foundational physiocracy towards manufacturing (biased for agriculture) returned, as cheap imports (owing to liberalized trade) destroyed established industries leading to ‘de-industrialization’.

Where are we twenty-five (25) years after instituting market reforms under the aegis of ‘structural adjustments’ (note: we began through the ‘structural adjustment loans’ of the World Bank, c. 1979)? National income continues to grow at dismally low rates, poverty had increased during the latter phase of the reforms (decreased only recently), unemployment remains high amid positive growth, and our developmental stage continues to be stuck up in the ‘growth stage’ (failed to reach ‘maturity’). Globalization, with its attendant ‘structural adjustment’ policies, has weakened nations, even caused fragmentation in others, a fact that had likewise been replicated in the Philippines with its separatist movements. Free trade had destroyed domestic industries (the USA case was hit so hard by this one), as some had to fold up (Marikina shoes exemplifies the Philippine case) and transfer elsewhere (Procter & Gamble-Philippine is an example). With weak or nil ‘safety nets’, chances are that many producers (e.g. fruits, vegetables) will lose against cheaply-priced imports. One thing is clear for the case of many developing economies, including the Philippines: market reforms failed miserably to get them to development maturity, even as it set back the development path of others.

So if both dirigisme and laissez faire have been failing in making life better for the nation and the majority of the people, what discourse than can work out to salve the ailments of most developing states? Expectedly, a ‘renaissance of nation-states’ has become the wave of the present, with many of its articulators defending a return to dirigisme in its old form—in its highly protectionist form. I used to be among such articulators, even as I now argue that Old Nationalism can have deleterious results when pushed to the extremes. We can’t wish globalization away, it is here to stay and galvanize some more, even as it challenges us all to path-find the opportunities that it can offer while neutralizing the threats that could result from it. In other words, re-echoing Herr Reich’s and Mdm Arroyo’s elucidations on the subject, I am now wont to advocate for a New Nationalism or neo-nationalism, a discourse that advances beyond the narrow confines of extremist dirigisme and laissez faire.

Let me move next to the key premises and contentions of ‘new nationalism’-Philippine style.

[From: Erle Frayne D. Argonza, “New Nationalism: Grandeur and Glory at Work!”. August 2004. For the Office of External Affairs – Political Cabinet Cluster, Office of the President, Malacaňan Palace.]

Advertisements

PACQUIAO VOWS FIGHT VERSUS POVERTY

May 18, 2011

PACQUIAO VOWS FIGHT VERSUS POVERTY

Erle Frayne D. Argonza

Good morning from the Pearl of the Orient!

Manny ‘Pacman’ Pacquiao, world’s best boxer pound-per-pound and the greatest boxer of the century, just defeated California’s prized fighter Mosley. The fight didn’t only highlight the prowess of the world’s best—and that best could extend to being the world’s top athlete today—but more importantly it heralded Pacquiao’s vow versus poverty in the Philippines.

“Boxing isn’t the greatest fight of my life,” declared the Pacman in front of media. “More than boxing, the greatest fight of my life is to end poverty in the Philippines,” he succinctly proclaimed. For a man who originated from the ‘poorest of the poor’ and who rose like a phoenix in a meteoric ascent to global fame and glory, he knows what he is talking about.

I am optimistic the Pacman will give muscles to his words, walk the talk, and redistribute wealth through two sources: (a) the personal wealth he gained from boxing, entertainment, and modeling for commercial products, a wealth that will continue to accumulate in the years ahead; and, (b) national budgetary appropriations, which he will partly approve as a member of the House of Representatives.

Truly one of the most colorful personalities of this century, Pacman’s value formation seems to have molded him well. From out of his personal wealth, he shares bounties to the poor folks—from the athletes who became poor with their decline from fame, to the underclasses who receive benefits through his foundations. He is a compassionate fighter and citizen, making him one of the exemplars for our youth all over the planet.

Poverty and hunger are ailments that been badly addressed in the Philippines across the many decades of development (the development programs began in 1948 yet). Now a middle class economy, the Philippines just might be trapped in the middle class category as it continues to falter in addressing mass poverty.

The factors contributing to poverty & hunger are complex, as they range from the public policy through institutional strength factors. And there’s the demographic factor of rapid population growth, as 2,000,000 new babies are born each year in the country alone (that doesn’t include those born to the 10 Million overseas Filipinos). Such factors continue to drag down PH esteem as it suffers from unimpressive credit ratings, high corruption index, low global competitiveness, and related global ratings.

Sometimes a country would need some superhero types to shore up the drive to salve lingering ailments. And for the Philippines, luck had struck it as one such exemplary figure, the Pacman of the planet, is dipping his hands to enable the achievement by poor folks of the Impossible Dream.

[Philippines, 12 May 2011]

@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@
Come Visit E. Argonza’s blogs & website anytime!

Social Blogs:
IKONOKLAST: http://erleargonza.blogspot.com
UNLADTAU: https://unladtau.wordpress.com

Wisdom/Spiritual Blogs:
COSMICBUHAY: http://cosmicbuhay.blogspot.com
BRIGHTWORLD: http://erlefraynebrightworld.wordpress.com

Poetry & Art Blogs:
ARTBLOG: http://erleargonza.wordpress.com
ARGONZAPOEM: http://argonzapoem.blogspot.com

Mixed Blends Blogs:
@MULTIPLY: http://efdargon.multiply.com
@FRIENDSTER: http://erleargonza.blog.friendster.com
@SOULCAST: http://www.soulcast.com/efdargon

Website:
PROF. ERLE FRAYNE ARGONZA: http://erleargonza.com

LIBERAL COÑO POWER & RISING POVERTY

April 20, 2011

LIBERAL COÑO POWER & RISING POVERTY

Erle Frayne D. Argonza

The Liberal Party is now up in power and neo-liberalism, the same ideology espoused since after the rise of FVRamos, continues to ravage natural, human, and physical resources to enlarge the pockets of billionaires and global oligarchs.

Neo-liberal policies of privatization, deregulation, liberalization comprise the trilogy of evils that have led to a great divide between haves and have-nots in the entire planet. So did the same policies unleash the greater elite powers to slam bang middle and lower classes who would have to satisfy themselves with bread crumbs.

As I’ve been saying in my articles, liberalism is just one step away from fascism. It is in fact a mask used by the same elites to conceal their plutocratic, top-down social control engagement done in the pursuit of their greed. It is a subterfuge for gangland power and warlord power in countries such as PH, the latter being the base of primal-sadistic power by elites in the North.

[Philippines, 17 April 2011]
%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%
LIBERALISM: MORE POVERTY & CORRUPTION

Prof. Erle Frayne D. Argonza
University of the Philippines

Good afternoon, fellows!

The Liberal Party in the Philippines has been bandying lately the good governance agenda. Philosophically bankrupt, the dogmatists of the party could at best parrot the verbiage of university academics who, in reductionist fashion, associated the development problems of the country to bad governance.

Poverty had alarmingly risen from 25% in 2001 to 32% today, as per government statistics. This came at a time when the economy doubled, GDP-wise, and the country had been dubbed as an ‘emerging market’. Can poverty be factored solely to bad governance, as liberal quacks now claim?

Whether the so-called ‘think-tank’ of the Liberal Party or LP possesses the comprehensive grasp of the country’s problems is doubtful. A ‘think-tank’ that is theoretically bankrupt could at best be a coterie of mediocre dudes whose sense of originality in problem-solving engagements is nil.

There surely were episodes in our economic history when poverty expanded. We can concretely site the following periods: 1983-1996, when poverty incidence rose from 35% in ’83 (Marcos era) to 49% in ’89 (Cory Aquino era) to a 60% peak in ’95 (Ramos Era); and, after a period of radical drop, moved up again in 2001 through 2009, from 25% (‘01)to 28% (’04) to 32% (‘09).

The 32% poverty incidence may not even be accurate. As Prof. Cielito Habito (Ateneo University) sited in his newspaper column, the figure could be a high 35%. My own intuitive assessment is that the figure could be much higher at around 45%.

Those high-poverty episodes were actually periods when the country was under the IMF programs’ tutelage. They were times when liberal policy reforms were radically implemented in the country, to note: liberalization, privatization, deregulation, tax reforms, reduced budgets for social services, currency devaluation, wage freeze, and increased utility prices.

Not only did we witness the expansion of poverty during the same episodes, we also saw the rise of corruption. Weak regulatory frameworks at a time of rising total budgets redound to liberalizing graft as well, resulting to larger largesse for bureaucrats & legislators (returns from pork barrel allocations).

Let’s take the case of trade liberalization. As soon as tariff reforms were implemented in full during the Ramos Era, a whopping P300 Billion+ worth of import duties were wiped out, thus reducing revenues so drastically. With nil safety nets in implementation, the tariff reform saw millions of affected small planters, fishers, craftsmen, and farm workers experience large-scale income drops, thus instantly leading to larger poverty incidence.

As commitments to tariff reforms are now binding upon our state, based on signed treaties (ASEAN, WTO), regulatory frameworks for executing projects remain weak. This bad situation ensures the perpetuation of the take of bureaucrats on projects, from the past 10% ‘s.o.p.’ circa 1980s, to the gargantuan 40% today and higher rate tomorrow. E.g. a road project worth P1 Billion will be priced/budgeted at P1.4 Billion, with P400 Million allowance for the grafters (they call it ‘for the boys’).

Note that during the periods of extensive liberal reforms, Hacienda Luisita escaped agrarian reform’s surgical operations. Of course, the regulatory and executory frameworks of the agrarian reform law were so weak, so much that President Aquino’s family estate was accorded special treatment that it enjoys till these days.

Ipso facto, liberal reforms practically destroyed the already weak regulatory frame that we Filipinos have struggled so hard to build since the time of the 1st presidency yet (Aguinaldo, 1898-1900). Curbing poverty and graft, which indeed go together, requires draconian tactics of state interventionism or dirigism, not liberalism.

It is all too easy a kindergarten stuff to forecast that under a liberal regime, poverty will swell to higher incidence (beyond 40%). As budgets and projects increase, so will graft move up, probably eating as much as 60% of total appropriations at certain junctures.

The ‘walang korupsyon’ (no corruption) flaunted by the liberal quacks is nothing but empty propaganda. Bereft of creative approaches to diminishing corruption, the ‘walang korupsyon’ line merely re-echoes an age-old line of traditional politicians or trapos desperate to gain electoral victories by duping a gullible electorate.

‘Walang korupsyon’ isn’t even liberal nor populist a line, but hyper-conservative. Conservatism serves the interests of Big Business, Big Landlords, Big Church (biggest landlord in the Philippines), and foreign capital.

We are therefore not surprised that the leaders and groups representing Big Business, Big Landlords, Big Church (Jesuits, Opus Dei, bishops), and foreign capital have openly supported Noynoy Aquino & the Liberal Party.

The LP of the Philippines now appears more as a copycat of the fascistic Liberal Democratic Party of Japan. Don’t ever be surprised that both parties are good friends within the Liberal International league.

A liberal regime will most likely be saddled with enormous graft and poverty problems that, within a couple of years of its incumbency, patriotic soldiers and populist groups would alternately shake it down to rubbles. A veteran of civil society campaigns myself, I would most likely be marching the streets again to oppose moralist pretenders who are in fact greedy crocodiles.

Liberalism doesn’t represent the interest of the nation and people, and should be rejected in the coming polls and the next ones to come.

[Philippines, 13 April 2010. Prof. Erle Argonza is an economist, sociologist, and international consultant. He’s a member of the very prestigious Eastern Regional Organization for Public Administration or EROPA.]
@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@
Come Visit E. Argonza’s blogs & website anytime!
Social Blogs:
IKONOKLAST: http://erleargonza.blogspot.com
UNLADTAU: https://unladtau.wordpress.com

Wisdom/Spiritual Blogs:
COSMICBUHAY: http://cosmicbuhay.blogspot.com
BRIGHTWORLD: http://erlefraynebrightworld.wordpress.com

Poetry & Art Blogs:
ARTBLOG: http://erleargonza.wordpress.com
ARGONZAPOEM: http://argonzapoem.blogspot.com

Mixed Blends Blogs:
@MULTIPLY: http://efdargon.multiply.com
@FRIENDSTER: http://erleargonza.blog.friendster.com
@SOULCAST: http://www.soulcast.com/efdargon

Website:
PROF. ERLE FRAYNE ARGONZA: http://erleargonza.com

COÑO POWER IN AQUINO GOVERNMENT

April 19, 2011

COÑO POWER IN AQUINO GOVERNMENT

Erle Frayne D. Argonza

Coño kid Noynoy Aquino is now president of the Philippines for almost a year. During the campaign period yet, I was already apprehensive of the handiwork of coño operators who were born with a ‘golden spoon’. They are those kinds who went to school with the purpose of displaying wealth and flashy cars, and were subjects of my scorn as a college student.

Just recently, P-Noy bought a sports car worth millions of pesos. Though supposedly a used car, just sporting that kind of vehicle would already raise eyebrows in many quarters. For accompanying that car is the lifestyle that goes with it. It is the lifestyle of lotharios, drug addicts, socialites, and every kind of derelict person you can think of out there, who surely live it dirty.

Now that the coños are in power, what have you to say? Will the same coño socialities throw cakes to the poor in order to solve poverty, as Marie Antoinette believed was the correct solution to pauperism?

[Philippines, 14 April 2011]
##########################################

VILLAR: EMBODIMENT OF ‘PHILIPPINE DREAM’

Prof. Erle Frayne D. Argonza
08 January 2010

The social forecaster J. Naisbitt, among the sharpest observers of cultural innovations worldwide, declared in his book Megatrends Asia that the ‘Asian dream’ is the global dream of the moment.
Realizing this gigantic power shift, Naisbitt challenged the youth of the West to “go East!”

If we were to localize the global trend of ‘Asian Dream’, we can find this in the capsule term ‘Philippine Dream’. This is the dream of any struggling child to live a future of abundance, a dream that was once championed in America (‘American dream’) but which has been lost along the way, a dream that has found root finally in our own motherland.

My contention is that, if the Philippine state would refurbish its nauseating image as a ‘weak state’, it would find a fresh start in electing a president who is an embodiment of the ‘Philippine dream’. Luck of all luck, the Nacionalista Party’s own top leader, Manny Villar, fits squarely into this ‘Philippine Dream’ mold.

The Manny Villar narrative is practically saying to our compatriots that nobody has to leave the country for overseas job in order to live abundance in everyday life. Stake it out in the country, live to learn well, be daring to be innovative and pioneering, and one will rise like a phoenix from the ashes of poverty.

Do not wait for opportunities to drop from the sky like ripe guavas descending on the mouth of a proverbial Juan Tamad. Build the opportunities, and be daring to re-engineer yourself in the process to keep on bringing you up to the next level of success.

Such is the sterling truth exemplified by the Villar narrative, which is indeed splendidly impressive and worth a plethora of accolades. Only Villar fits this mold among the couples of presidential candidates, most of whom are the typical coño kids who treat the poor folks as utilitarian objects for vote-gathering purposes. Not only did Villar soil his hands in creating opportunities for housing and urban development, he was also among those noblesse legislators who built enabling measures to widen the latitudes of social equity and economic prosperity. And yet no coño kid is he amid his abundant life!

I remember the coño kids on campus as highly scorned spoiled brats who are in the university largely to display wealth and who condescendingly regard their schoolmates as lizards and rats. A few of them did I make friends with, those who can be remolded to a life of social relevance, even as I was among those self-supporting students (I was a full scholar) and grew as a militant activist. Well immersed among fellow intellectuals, I only had but expletives reserved for the coños.

Today I am among those who ask: what right has a coño to be president of the republic? A person who grew up in a mansion and couldn’t soil his hands in work deserves to be a leader of colonial era government, and such an era is long gone!

I would ask the same for a vice-president: what right has a coño to be vice-president of the country? Isn’t Loren Legarda, who now teams up with Manny Villar, the most fit for the job since she embodies the ‘Philippine dream’ and all the sterling qualities of a talented and competent Pinoy who has risen from the hovels and lead a prosperous life?

An emerging market such as the Philippines has most to gain from electing highly competent top officials who embody the ‘Philippine dream’ and/or ‘Asian dream’. Conversely, it would be disastrous to elect Inquisitionist coño kids who in fact are mere smokescreens for crocodiles.

I am a firm believer in the ‘Philippine dream’ or ‘Asian dream’, and I go for a Villar-Legarda team for 2010.
@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@
Come Visit E. Argonza’s blogs & website anytime!
Social Blogs:
IKONOKLAST: http://erleargonza.blogspot.com
UNLADTAU: https://unladtau.wordpress.com

Wisdom/Spiritual Blogs:
COSMICBUHAY: http://cosmicbuhay.blogspot.com
BRIGHTWORLD: http://erlefraynebrightworld.wordpress.com

Poetry & Art Blogs:
ARTBLOG: http://erleargonza.wordpress.com
ARGONZAPOEM: http://argonzapoem.blogspot.com

Mixed Blends Blogs:
@MULTIPLY: http://efdargon.multiply.com
@FRIENDSTER: http://erleargonza.blog.friendster.com
@SOULCAST: http://www.soulcast.com/efdargon

Website:
PROF. ERLE FRAYNE ARGONZA: http://erleargonza.com

POVERTY: PH LINGERING ACHILLES HEEL

April 14, 2011

POVERTY: PH LINGERING ACHILLES HEEL

Erle Frayne D. Argonza

Let me follow through on the hunger report by reflecting on poverty once more. Ph is an economic boom episode and its chief exec Noynoy Aquino has been in power for almost a year since installation. Yet hunger grows amidst relative abundance!

Government statistics has to be massaged anew so as to make it appear that poverty has been going down. The ‘doctorates of statistical massage’ should better do their jobs well, as the latest survey of the Social Weather Stations clearly show a hunger rate of 20%. It’s so self-evident that poverty breeds hunger, so the growing hunger means poverty is growing too, isn’t it? Commonsensical a stuff!

Below is an article on poverty that I wrote while the election period was still going on last year. Since last year, poverty hasn’t shrunk!

[Philippines, 08 April 2011]
#########################################

POVERTY: PHILIPPINES‘ ACHILLES HEEL

Erle Frayne D. Argonza

Poverty is the Achilles’ heel of the Philippine state, and will be so for at least two (2) more decades. Amid the appreciable growth the economy has sustained so far, with the national economy doubling in just eight (8) years during the incumbency of president Gloria Arroyo, poverty remains very high.

If we go by the yardsticks of the United Nations Development Program (UNDP) and the World Bank, the Philippines has been performing fairly well on wealth production as a whole, so much that the country graduated to a middle income status by the turn of the century. No more a poor economy by world standards, yet the country’s poverty increased from 28% in 2001 (when Arroyo took over the presidency) to 33% today (per latest government statistics).

Paradoxical, come to think of it, that while the economy has been growing and had moved to middle income status, more people have become poorer. Tough, very tough, is the task of mining for the ‘gini in the bottle’ that would reduce poverty considerably to a negligible 5% or less, a level that is easily manageable and where state and communities can simply decide to fully subsidize the remaining poor.

Whether the Philippines can meet the UN’s Millenium Development Goal of cutting poverty by half in 2015 seems much clearer now to social forecasters: the dream is elusive and unattainable. Not even if the economy will double again from mid-2009 to 2015 which is a most likely development.

The Philippines’ poorest happens to be the rural populations, notably the fisherfolk sector where malnutrition runs the highest rate (2/3 of children/families). Rural population is now down to 34% or 1/3 of the population, while the urban peoples comprise 66% or 2/3. Urban to rural poverty ratio is 1:2.5, meaning that for every 1 poor person in the cities & towns, there’s an equivalent of 2.5 persons in the countrysides.

The message is clear to the next government (formed by the new president after the May polls this year) that the attack zone on poverty should be the rural population. Both antipoverty and anti-hunger programs should be initiated at very high levels in the countryside to be able to bring down total poverty by a large degree.

Failure to solve rural poverty in the long run redounds to perpetuating insurgency. Even if the present insurgent groups would concur peace pacts with the state, new insurgent groups will emerge again in the foreseeable future should the rural folks remain paupers.

Urbanization is now moving up, and with its growing eminence has come the rise of new cities. Citification has seen the incomes of communities treble by leaps and bounds, thus permitting the same communities to spend on infrastructures and social development.

Left to themselves, without massive migrations from rural folks, the cities can accumulate enormous income surpluses to solve unemployment, poverty, and malnutrition (both hunger and obesity). Philanthropic groups consequently rise from civil society and market players, and boost surplus production for solving poverty.

However, such is not the case even as the migration of the poor from the countryside to the cities continues in steady waves. So this brings us all back to the challenge of solving poverty right at the backyards where the poorest are most concentrated. This means that the food producers shouldn’t be left out in the development game, even as rural development should be brought to its next level.

Goal-wise, the realistic target is to reduce poverty from 33% in 2009 to 25% by 2015, or an average of 1.33% reduction per annum. Means-wise, an appreciable mix of good governance, right socio-economic policies, and strengthening of institutions would do a long way to bring down poverty altogether in the short run.

Urban population will grow to 70% around 2015, while rural population will go down further to 30%. With lower rural populations to manage by then, there is no more reason for government not to be able to do something to solve poverty. And we say government, because the increase in poverty largely came from governance-related factors such as poor absorptive capacity (to handle large budgets), inefficiency, graft, poor inter-governmental coordination, and low political will to pursue audacious solutions to daunting problems.

In 1989, this analyst wrote an article “Prospects of Poverty Alleviation in the 1990s,” a piece that I delivered as a symposium lecture at the University of the East (Prof. Randy David was also a speaker). At that time, poverty was a high of 49%, while urban to rural poverty was 1:2.1.

Since 1989, we have seen poverty reduced from 49% to its present level of 33% (a 5% increase since 2001 though), although rural poverty moved up paradoxically during the same period. Poverty reduction is not really impossible, as evidenced by the huge reduction across a 20-year period. Bringing it down further to 25% by 2015 is a doable target.

So let us see how the nation will fair under the next government of the republic (after May polls), when we see a new set of political leaders and cabinet members installed to power. As I’ve mentioned in earlier articles, my standpoint is that a nationalist coalition, such as what the present candidate Sen. Manny Villar, is most equipped with policy paradigm and tools to deal with the Achilles heel of pauperism, aside from the competence and visionary acumen of the noblesse senator.

By nationalist, I mean that of moving towards a regulated market and fair trade, with high propensity for ‘physical economy’ policies. We can no more return to the days of liberalization policies that saw the economy crash down in ’83-’85, stagnate for a time and grow again before hitting the next recession in ’97, and finally move up to middle income status only after a turtle pace struggle taking three (3) decades.

Liberalism and its propensity to be pro-Big Business and Big Landlord is a big no in our fight against poverty, whether in the Philippines and other nations of the globe. In my country, nationalism is the antidote paradigm and social technology watershed to reverse decades of liberal policies and solution to poverty. I’ve been echoing this theme since my teenage years yet, and remains steadily anchored on it.

[Philippines, 20 March 2010]
@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@
Come Visit E. Argonza’s blogs & website anytime!
Social Blogs:
IKONOKLAST: http://erleargonza.blogspot.com
UNLADTAU: https://unladtau.wordpress.com

Wisdom/Spiritual Blogs:
COSMICBUHAY: http://cosmicbuhay.blogspot.com
BRIGHTWORLD: http://erlefraynebrightworld.wordpress.com

Poetry & Art Blogs:
ARTBLOG: http://erleargonza.wordpress.com
ARGONZAPOEM: http://argonzapoem.blogspot.com

Mixed Blends Blogs:
@MULTIPLY: http://efdargon.multiply.com
@FRIENDSTER: http://erleargonza.blog.friendster.com
@SOULCAST: http://www.soulcast.com/efdargon

Website:
PROF. ERLE FRAYNE ARGONZA: http://erleargonza.com

POVERTY: PH LINGERING ACHILLES HEEL

April 11, 2011

POVERTY: PH LINGERING ACHILLES HEEL

Erle Frayne D. Argonza

Let me follow through on the hunger report by reflecting on poverty once more. Ph is an economic boom episode and its chief exec Noynoy Aquino has been in power for almost a year since installation. Yet hunger grows amidst relative abundance!

Government statistics has to be massaged anew so as to make it appear that poverty has been going down. The ‘doctorates of statistical massage’ should better do their jobs well, as the latest survey of the Social Weather Stations clearly show a hunger rate of 20%. It’s so self-evident that poverty breeds hunger, so the growing hunger means poverty is growing too, isn’t it? Commonsensical a stuff!

Below is an article on poverty that I wrote while the election period was still going on last year. Since last year, poverty hasn’t shrunk!

[Philippines, 08 April 2011]
#########################################

POVERTY: PHILIPPINES‘ ACHILLES HEEL

Erle Frayne D. Argonza

Poverty is the Achilles’ heel of the Philippine state, and will be so for at least two (2) more decades. Amid the appreciable growth the economy has sustained so far, with the national economy doubling in just eight (8) years during the incumbency of president Gloria Arroyo, poverty remains very high.

If we go by the yardsticks of the United Nations Development Program (UNDP) and the World Bank, the Philippines has been performing fairly well on wealth production as a whole, so much that the country graduated to a middle income status by the turn of the century. No more a poor economy by world standards, yet the country’s poverty increased from 28% in 2001 (when Arroyo took over the presidency) to 33% today (per latest government statistics).

Paradoxical, come to think of it, that while the economy has been growing and had moved to middle income status, more people have become poorer. Tough, very tough, is the task of mining for the ‘gini in the bottle’ that would reduce poverty considerably to a negligible 5% or less, a level that is easily manageable and where state and communities can simply decide to fully subsidize the remaining poor.

Whether the Philippines can meet the UN’s Millenium Development Goal of cutting poverty by half in 2015 seems much clearer now to social forecasters: the dream is elusive and unattainable. Not even if the economy will double again from mid-2009 to 2015 which is a most likely development.

The Philippines’ poorest happens to be the rural populations, notably the fisherfolk sector where malnutrition runs the highest rate (2/3 of children/families). Rural population is now down to 34% or 1/3 of the population, while the urban peoples comprise 66% or 2/3. Urban to rural poverty ratio is 1:2.5, meaning that for every 1 poor person in the cities & towns, there’s an equivalent of 2.5 persons in the countrysides.

The message is clear to the next government (formed by the new president after the May polls this year) that the attack zone on poverty should be the rural population. Both antipoverty and anti-hunger programs should be initiated at very high levels in the countryside to be able to bring down total poverty by a large degree.

Failure to solve rural poverty in the long run redounds to perpetuating insurgency. Even if the present insurgent groups would concur peace pacts with the state, new insurgent groups will emerge again in the foreseeable future should the rural folks remain paupers.

Urbanization is now moving up, and with its growing eminence has come the rise of new cities. Citification has seen the incomes of communities treble by leaps and bounds, thus permitting the same communities to spend on infrastructures and social development.

Left to themselves, without massive migrations from rural folks, the cities can accumulate enormous income surpluses to solve unemployment, poverty, and malnutrition (both hunger and obesity). Philanthropic groups consequently rise from civil society and market players, and boost surplus production for solving poverty.

However, such is not the case even as the migration of the poor from the countryside to the cities continues in steady waves. So this brings us all back to the challenge of solving poverty right at the backyards where the poorest are most concentrated. This means that the food producers shouldn’t be left out in the development game, even as rural development should be brought to its next level.

Goal-wise, the realistic target is to reduce poverty from 33% in 2009 to 25% by 2015, or an average of 1.33% reduction per annum. Means-wise, an appreciable mix of good governance, right socio-economic policies, and strengthening of institutions would do a long way to bring down poverty altogether in the short run.

Urban population will grow to 70% around 2015, while rural population will go down further to 30%. With lower rural populations to manage by then, there is no more reason for government not to be able to do something to solve poverty. And we say government, because the increase in poverty largely came from governance-related factors such as poor absorptive capacity (to handle large budgets), inefficiency, graft, poor inter-governmental coordination, and low political will to pursue audacious solutions to daunting problems.

In 1989, this analyst wrote an article “Prospects of Poverty Alleviation in the 1990s,” a piece that I delivered as a symposium lecture at the University of the East (Prof. Randy David was also a speaker). At that time, poverty was a high of 49%, while urban to rural poverty was 1:2.1.

Since 1989, we have seen poverty reduced from 49% to its present level of 33% (a 5% increase since 2001 though), although rural poverty moved up paradoxically during the same period. Poverty reduction is not really impossible, as evidenced by the huge reduction across a 20-year period. Bringing it down further to 25% by 2015 is a doable target.

So let us see how the nation will fair under the next government of the republic (after May polls), when we see a new set of political leaders and cabinet members installed to power. As I’ve mentioned in earlier articles, my standpoint is that a nationalist coalition, such as what the present candidate Sen. Manny Villar, is most equipped with policy paradigm and tools to deal with the Achilles heel of pauperism, aside from the competence and visionary acumen of the noblesse senator.

By nationalist, I mean that of moving towards a regulated market and fair trade, with high propensity for ‘physical economy’ policies. We can no more return to the days of liberalization policies that saw the economy crash down in ’83-’85, stagnate for a time and grow again before hitting the next recession in ’97, and finally move up to middle income status only after a turtle pace struggle taking three (3) decades.

Liberalism and its propensity to be pro-Big Business and Big Landlord is a big no in our fight against poverty, whether in the Philippines and other nations of the globe. In my country, nationalism is the antidote paradigm and social technology watershed to reverse decades of liberal policies and solution to poverty. I’ve been echoing this theme since my teenage years yet, and remains steadily anchored on it.

[Philippines, 20 March 2010]
@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@
Come Visit E. Argonza’s blogs & website anytime!
Social Blogs:
IKONOKLAST: http://erleargonza.blogspot.com
UNLADTAU: https://unladtau.wordpress.com

Wisdom/Spiritual Blogs:
COSMICBUHAY: http://cosmicbuhay.blogspot.com
BRIGHTWORLD: http://erlefraynebrightworld.wordpress.com

Poetry & Art Blogs:
ARTBLOG: http://erleargonza.wordpress.com
ARGONZAPOEM: http://argonzapoem.blogspot.com

Mixed Blends Blogs:
@MULTIPLY: http://efdargon.multiply.com
@FRIENDSTER: http://erleargonza.blog.friendster.com
@SOULCAST: http://www.soulcast.com/efdargon

Website:
PROF. ERLE FRAYNE ARGONZA: http://erleargonza.com

HUNGRY FOLKS GROW AMIDST PLENTY

April 10, 2011

HUNGRY FOLKS GROW AMIDST PLENTY

Erle Frayne D. Argonza

The Social Weather Stations or SWS just recently conducted its regular national survey on hunger, with the alarming conclusion of growing poverty incidence. A 20% hunger rate was the bleak turn of the survey, which is indeed gruesome to the stomach given the economic boom years.

It seems that the only people benefiting from the economic boom are the likes of SMC’s Ang, PLDT’s Panganiban, Noynoy cronies and intellectual prostitutes, and the likes. It’s almost a year now since Noynoy Aquino was installed to the presidency, and so we may need to begin to assess whether His Excellency’s dispensation had fared well in alleviating poverty and in putting an end to insurgency that has been caused by hunger and poverty among all causes.

I am reflecting back on the agenda expectations I had during the campaign period, chief of which was the physical economy as crux of campaign. Do we have a physical economy frame that takes down hunger effectively, or do we have a hodge podge economy so badly integrated and managed by incompetent prostituted intellectuals?

[Philippines, 08 April 2011]

########################################
PHYSICAL ECONOMY IN RP’S 2010 POLLS

Erle Frayne D. Argonza

The debates by presidential candidates have been reverberating the media audiences in the country for couples of weeks now. The issues have ranged from those that are social policy-oriented (subsidies to poor, health, education, housing, jobs) to macro-economic policies (sustaining growth, accelerating development) and moral policies (corruption, reproductive health). Some articulations of foreign policy were also heard from the competing gentlemen.

Seemingly confusing in their broadness, somehow the various forums for the debates (not actual debates but simply presentation of each one’s opinion about policy questions) did give a semblance of information-based campaigns by enthused candidates. This is already quite a departure from previous polls when debates were sparse and superficial, and should be lauded by observers.

What this analyst, who is a public policy expert, wishes to see clearly in the debates is the economic issue of whether to highlight the physical economy policies versus the virtual economy in the management of jobs and wealth creation by the next government. I raised this same question in the last presidential poll in the USA that pitted Senators Obama and McCain in a neck-to-neck fight. I shared my own assessment then that Sen. Obama resonated nearest to a physical economy inclination and should be supported by USA’s voters.

To reminisce a bit, the national economies saw the radical ascent of Reaganomic policies of privatization, deregulation, liberalization, and reinforcing policies beginning in 1980. Such policies led to the rapid integration of nations into a global economy, liberalized the cross-border flow of financial and monetary assets, and eventually led to the predominance of the ‘virtual economy’ based on predatory finance.

In the mid-90s, the Philippines saw its investments structure alarmingly imbalanced, with 86% or 6/7 of total comprising of portfolio capital, and only 1/7 or barely 16% in real or physical economy investments inclusive of FDIs (direct foreign investments). As early as 1989, I already raised the alarm bells that excessive radical liberalization of the economy could jeopardize the financial sector in the short run and lead to an economic collapse that could be far worst than the 1984-86 Depression of the Marcos era.

When a situation comes that the virtual economy dominates over the physical economy (agriculture, industry, S & T, transport) and subordinates the latter, a bubble is created. A bubble economy is one that grows on the basis of speculations in stocks and predatory operations of financial derivatives (secondary debt papers traded in the global market), and is bound to collapse when a burst comes since it isn’t based on tangible goods.

Surely enough, when the bubble burst in Thailand in June 1996, the ‘butterfly effect’ of a mini-flapping of wings created a storm across a vast region. We then dubbed that crisis as the ‘Asian financial meltdown’. The economies and financial institutions that had the greatest exposure to portfolio finance suffered the most.

The worst was yet to come though, as the USA had to wait for 2007 before it would experience its own crash, a catastrophic crash that spread to Europe and Japan (twas barely out of a decade-long recession). The same bubble economy and its predictable burst led to the crash, a recession that hasn’t fully retreated yet. Europe is still in flames today (watch the financial flames in Greece, Spain, Finland), while Japan remains as flat as it was during its 10-year crisis (1994-2004).

The fact of the matter is that, in a virtual economy, the predatory financiers (bankers included) gain the most, while the people pay the price for the collapse. And the payment comes in the form of ‘stimulus package’ that are derived from tax revenues. So the equation is that financiers run away with the massive loot, and the people pay for the cost of the looting crime. The culprits then run away largely unpunished, while the people face the punitive flames of massive business closures, retrenchment, unemployment, and bad debts.

In my book Fair Trade & Food Security (Kaisampalad publication, 2005/07), I emphatically stressed that we have to reverse the free market and free trade policies to be able to regain economic wellness. Reversal means we have to go back to the principles of regulated economy (production, trade, distribution, consumption), and replace free trade with fair trade in our international trade.

Strong regulatory frameworks, coupled with strong institutions and good governance, will redound to bringing back the physical economy into place. With the economy based on the physical or real economy, this country and any country for that matter will weather any economic storm both local and global. There is ample funds to pay national debts, balance the budget, fund social programs, create jobs, and increase wages.

Among all presidential candidates, only that of Senator Manny Villar so far resonates the strongest in terms of echoing the physical economy. This resonance could be explained by the fact that the noblesse legislator immersed himself in housing & infrastructures for the longest time of his life as an entrepreneur, and only fractionally engaged in speculative engagements. Besides, he was witness to the maelstrom on the realty sector caused by the bubble burst of ’97, a burst that wasn’t of his own making as it was the maneuverings of George Soros & pals via currency attacks (monetary markets) that led to the meltdown.

I hope you would agree with me that the slogan for this year’s polls would be: “It’s the physical economy, stupid!”

[Philippines, 19 March 2010]
@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@
Come Visit E. Argonza’s blogs & website anytime!
Social Blogs:
IKONOKLAST: http://erleargonza.blogspot.com
UNLADTAU: https://unladtau.wordpress.com

Wisdom/Spiritual Blogs:
COSMICBUHAY: http://cosmicbuhay.blogspot.com
BRIGHTWORLD: http://erlefraynebrightworld.wordpress.com

Poetry & Art Blogs:
ARTBLOG: http://erleargonza.wordpress.com
ARGONZAPOEM: http://argonzapoem.blogspot.com

Mixed Blends Blogs:
@MULTIPLY: http://efdargon.multiply.com
@FRIENDSTER: http://erleargonza.blog.friendster.com
@SOULCAST: http://www.soulcast.com/efdargon

Website:
PROF. ERLE FRAYNE ARGONZA: http://erleargonza.com