Posted tagged ‘social capital’

LARGE CLASS IN UNIVERSITIES: OUTDATED, AUTHORITARIAN!

November 8, 2015

LARGE CLASS IN UNIVERSITIES: OUTDATED, AUTHORITARIAN!

Erle Frayne D. Argonza

It’s late afternoon as I write this piece, and it’s the longest day in the northern hemisphere too (summer solstice). I will devote this piece to the matter of large university classes that are the mode of instruction in many academic institutions across the globe.

Large classes are a thing of the past. The large class modality was referred to as ‘Great Man pedagogy’ in Europe, and was critically challenged by the youth and professors during the stormy youth heydays of the 1960s and ‘70s.

The human psyche is rapidly evolving towards greater individuation. As we humans become more individuated, the educational instruction fit for us is one that should account for and enable our individuality, even up to the point of providing ample space for eccentricity in each one.

In the olden days, when the Herd Mind or folk mind was the characteristic psyche of the people, the modality of instructions was one that would fit them well. Large classes evoked the ‘Herd instinct’ (Nietszchean label for the same), and unconsciously provided a semblance of community for peoples of those ancient times who were cut off from family & village to study in the university.

The coming of the Industrial Age, right after the conclusion of the 30 Years War (1618-48), ushered the ‘assembly line’ of mass production of articles of manufactures. The ‘assembly line’ method found its concomitant equivalent in the Great Man pedagogy which churned out collegiate graduates like commodities for sale in a rapidly expanding labor market.

Up until the late 19th century, during the Victorian Era that is the nadir of the modern age, Great Man pedagogy was a largely unquestioned modality of instruction. As the crisis of the early 20th century set in, the same pedagogy found perfect compatibility with the nascent totalitarian ideologies and systems of that era (fascism, Nazism, communism).

Indubitably, the success of ‘assembly line’ classes was effective only insofar as the psyche remained as more folk-mind or herd-oriented. As the psyche mutates to more individuated type, it will militate against anything that brings it back to the Herd: subject to manipulation and shaping by authoritarian if not sociopathic interest groups and persons.

Sure enough, as the youth rebellion of the 60s set in, the students of the Sorbonne in Paris burst out in revolt against the Great Man pedagogy circa 1968. Other universities quickly caught up the fiery flames of the revolt and followed suit in a tempo of upheavals that were largely unplanned and spontaneous.

Accustomed to bureaucratism and pork barrel largesse that went with mainstream political power, the French Communist Party was caught flat-footed by that revolt. Tailing behind the event that indicated its being mired in intellectual bankruptcy and betrayed its archaic mindset, the communists lose relevance almost overnight.

Had the communists grasped that event quickly and seized the opportunity by siding with the anti-large class youth, the sociopolitical landscape of France and Europe could have changed forever. A social revolution of a new kind, bred by a fusion of working class militancy and youth revulsion against archaic pedagogy and culture, could have been registered in the annals of history as worth our positive valuation.

It is shocking to find out that the large class modality is still around with us today. It is anathema to the goal of human liberation, even as it could be a launching ground to breed new ‘boot camp’ babies for certain interest groups of a fascistic/authoritarian nature.

The Industrial Age had now passed away, and the Post-Industrial/Postmodern Age has brought along with it an erasure (sous rapture) of the dividing line between Reason and Madness. Fascism is resurgent worldwide, and before we’d notice it a global state would be in the offing that is orchestrated by an ideological force of global Bonaparte.

If the large class modality is re-introduced in any university whatsoever, it should only be on an interim phase. It is a regressive move, and running counter to the gamut of psychical individuation, it will erode in time and be abolished across the globe.

Should there be a youth revolt against this antiquated pedagogy in my own home country, I will be glad to make my presence in the barricades to be set up.

‘LATE’ CAPITALISM CRASHING DOWN ITS DEATH BED

September 25, 2015

‘LATE’ CAPITALISM CRASHING DOWN ITS DEATH BED

 

Erle Frayne D. Argonza

 

Good evening!

The events in the Eurozone are now getting to be more alarming. Forecasters are now claiming that another round of recession is in the offing, as the bubble burst that began in Greece will spread to Spain, Ireland, and other member-states of the EU.

Will liberal capitalism continue to live a life that seems to hang in the balance? Or will capitalism need to restore itself through totalitarian means? What’s so wrong with the system that it just can’t be sustained enough?

Let me share to you past blog writings about the subject: ‘mad economics’ and the ‘demise of liberal capitalism.’

[Philippines, 23 May 2010]

‘LATE’ CAPITALISM ENDS IN CRASHING BLOW POST-‘MAD ECONOMICS’

 

Erle Frayne Argonza

Good afternoon!

At this moment, I’m sipping coffee contained in a pack that is sold for worth P130, or $3.00. The pack is one of the domestic brands of brewed coffee blends, ready for the drip coffee maker, of the Arabica and/or Robusta varieties. In economic parlance, this coffee is a commodity because (a) it was intended for exchange and not for the coffee producer’s consumption alone, and (b) money was used to acquire (purchase) it.

I have such deep fondness for coffee, as I acquired my coffee-drinking behavior as a childhood habit yet. In my hometown of Tuguegarao (city), Cagayan province (North Philippines), coffee beans were grounded into powder form and sold right inside the ‘wet’ market, was brewed using the local decoction techniques, and was consumed by people of all ages from pre-school to senior’s age. That was then, and that was how I learned to drink this beverage at age 5 more or less. I was hooked to the habit since then, even as I continued to drink milk that I still do till now.
Both coffee and milk are among my health formulas, and both are commodities.

The question I’m asking now is, will commodity-based economics survive the times ahead? Both coffee and milk will survive for sure, but will the money economy that underpins them survive as well? As to the broader world system of capitalism, will it survive too or is it in fact on its death knell today?

Capitalism was the last of the world systems that embodied the ‘money economy’ to which it properly belongs. With the opening of the 20th century, the socialist world system appeared on the social landscape and attempted to serve as an alternative to capitalism, but this experienced its early demise as its implementers found out that it cannot be sustained after all. Both capitalism and socialism are embodiments of the ‘money economy’ as it later turned out to be, they are just but two sides of the same coin: the ‘money economy’.

Socialism is gone, and no matter what attempts there may arrive to survive it in some other forms, this variant of the ‘money economy’ is gone. Now capitalism is all alone, and it is getting more real than virtual that it too is bound to crash a catastrophic end, and with its demise, the “last of the (economic) Mojicans” is bound to disappear (my apologies to Mojicans if my note sounds ethnically incorrect). And with capitalism’s demise, the whole of the ‘money economy’ folds up like unto a book that had reached its last chapter, and deserves more to be consigned to the archives of history.

The Frankfurt school thinkers, notably Jurgen Habermas, cogitated that capitalism’s life span was extended somehow, and was dubbed as ‘late’ capitalism in this last phase of the world system. In this phase, state planning and interventionism were infused into the system to extend its life. Before ‘late’ capital came the mercantile, free enterprise, and monopoly phases of this world system. Will there be another phase to capitalism after ‘late’ capital?

Before I answer that extension of life span, let me stress that ‘late’ capitalism shall end in the following process and manner:

· The re-introduction of liberalization—of free market and free trade principles—into ‘late’ capital shifted engagements away from production, the real foundation of the economy, to the sphere of predatory finance, thus producing the gargantuan ‘bubble economy’. The ‘physical economy’ of production transmogrified into the ‘virtual economy’ that produces no real value other than imaginary or delusional values. It is ‘mad economics’ in operation, no longer the ‘rational economics’ of mercantilists, classicists and neo-classicists.

· The ‘mad economics’ led to the yawning gap between actually produced values and the aggregates of financial derivatives and debts combined, to the extent that the former shrinks at a rapid rate relative to the latter. As bubbles burst from one commodity sector to another, leading eventually to a crisis of gargantuan proportion, all the more will production shrink, unable to produce values that can input into the demand functions for fresh money to pay for aggregate credits, primary debts, secondary debt obligations, and so on.

· The crisis will then move on to the further shrinking of production, tightening of credit sources, and hyperinflationary situation in utilities (notably gas & power), food, base metals and other vital commodities. Total economic collapse results from the foregoing.

· The economic collapse then leads to social unrests, turmoil, upheavals, civil wars, food wars, water wars, and possibly intercontinental wars such as another 3rd world war. The clash of world powers and their surrogate emerging markets will become the flames of a possible long war akin to the 30 Years War (c.1618-48).

Let me now end at that instance. Suffice me to proclaim that the death knell of ‘late’ capitalism and the whole of the ‘money economy’ of the last 2000 years or so are ending. The ‘non-cognitive economics’ of the Roman to feudal era, the ‘rational economics’ of the Renaissance to monopoly capital era, and the ‘mad economics’ of ‘late’ capital were markedly the underpinning mediation processes of that entire 2000-year epoch. The epoch and its last phase of capitalism is rapidly drawing to a close.

[Writ 22 August 2008, Quezon City, MetroManila.]

CAPITALISM’S DEMISE: WHAT WENT WRONG?

Erle Frayne Argonza

To all fellow men and women out there who may have deep fondness for the liberal capitalist model of economic adaptation, I hope that you can make some adjustments in your cognitive banks. Capitalism is not a permanent facet of human life, but merely one among various epochs that will come to pass. Only impermanence is sacrosanct in the cosmos, so please refrain from singing hallelujah to a world system that is on its death knell as I articulated in a previous article.

And please refrain from swallowing hook-line-&-sinker the contentious propaganda of Francis Fukuyama about the ‘end of history’, that accordingly history had concluded with the galvanization of liberal capitalism, that history makes no more sense. Fukuyama’s theory is a slapstick narrative of hyper-valuation of the ‘mad economics’ of late capitalism and hypo-statization of reality that has no relation at all to the real in the world out there. Fukuyama had taken as ‘real’ what is actually ‘virtual’, and froze time much like unto a fairy tale of timelessness, of history-less Nietzschean moment that is fit more for infants than for adult humans.

Fukuyama epitomizes the ‘mad economics’ of all those Pied Pipers of the global oligarchy for whom he works, and his discourse is akin to the ‘mad discourse’ so described by the late Michel Foucault. The ‘mad economics’ of Friedman, Hayek, Fukuyama, and all those technocrats who serve as processors and bagmen for the global oligarchy, is precisely symptomatic of that colossal ailment of a world system, and as we all know, madness can never salve ailments but rather hasten the system’s death. Caput! Blow your horns, prepare dirges to this Dead One!

Unless that you yourselves have become maddened by the seemingly infinite monies flowing unto your purses as you are among the beneficiaries of ‘late’ capital, unless that you are indeed now suffering from combined maladies of sociopathy and schizophrenia, unless that sanity had departed from thee forever, please heed the last plea of your own conscience where sanity had retreated: CAPITALISM IS DEAD! No amount of propagandizing, of contorted interpretations, can ever change the course of history at this juncture, as we are all headed for a TOTAL SYSTEM COLLAPSE in the months ahead. Read that please: MONTHS AHEAD, not years ahead.

What went wrong with capitalism? I’m sure all of you fellows knew what went wrong, do I even need to answer that? Your previous thinker mentors, among economists and sociologists, forewarned you all of the forthcoming demise of capitalism, but you paid nary an attention to those brilliant minds as you were so engrossed in your ‘conspicuous consumption’, behaving more like some infantile EATERS or as anthropoids rather than as thinking and spiritually evolving humans. You are all very much human, so please consistently behave like one, and begin by listening to the Inner Voice of your conscience, for that voice is your soul’s.
Let me summarize the diagnostics, forewarnings and/or prophecies of our thinker mentors from the West, and I’d stress WEST because there are some other thinker mentors from the EAST and SOUTH whose peregrinations are so recondite they are not so easily digestible. Let me just stress the WEST as this is what is common to us all. So let me re-echo the thinkers and their theories:

· Karl Marx & Friedrich Engels: The internal contradictions between the private nature of capital (ownership of means of production) and the social nature of production. The ‘crisis of overproduction’ and the ‘law of the falling rate of profit’ are attendant patterns. Social revolution results, then the alternative society will be constructed.

· Max Weber: Industrial capitalism’s granite product, the bureaucracy, led to dehumanization. He never forecast though whether this dehumanizing system can be sustained—but please read between the lines. (His contemporary Emile Durkheim had a similar observation about ‘anomie’ or normless state of urban/industrial society.)

· Thorsten Veblen: The end-phase of industrial capitalism is markedly pathological. ‘Conspicuous consumption’ is the disease of this phase, the toxic behavior from the ruling class that later filtered down to the emerging middle class.

· Joseph Schumpeter: The internal contradiction between the desire for profit and the revolutionary character of innovation. The demise of capitalism will see the possibility of the technical class taking over society and build that alternative system later.

· Daniel Bell: The ‘post-industrial’ society had already been born right inside capitalism. A distinct modality in itself, post-industrialism will eventually prevail in a system that isn’t capitalist (or money economy) but rather knowledge-based. The ‘service worker’ had arrived on the social landscape, the prototype class of the future.

· Theodore Adorno, Jurgen Habermas, Herbert Marcuse: ‘Late’ capital is characterized by the pervasiveness of ‘instrumental reason’, where reason is used to justify the non-rational (‘madness’ in Foucault’s argot), where state planning/intervention was infused into a system that scorned intervention.

· Alvin Toffler: Both capitalism and socialism are based on hoarding, both are variants of the same industrial society of yesteryears, both are based on ‘2nd wave’ capital-intensive technologies and non-renewable energy sources. The ‘post-industrial’ society is altogether distinct, isn’t based on hoarding, production-consumption (‘prosumer’) is based on ‘3rd wave’ knowledge-intensive technologies and renewable energy sources, knowledge cannot be hoarded.

I need not articulate further, do I? They all converged on one theme: capitalism is transitory, it bred social maladies (alienation, dehumanization, anomie, conspicuous consumption,…), is systemically flawed, and will be dismantled at sometime in the future.

No matter how delimited their theories maybe, as they all proceeded from certain perspectives (they were all ‘paradigm’-based in the jargon of Thomas Kuhn), they all proclaimed—in either tacit or explicit fashion—the coming demise of the system. They weren’t as silly as Fukuyama who popularized seemingly ‘satanic verses’ (distorted precepts) about a non-changing, permanent economic landscape called ‘liberal capitalism’, but were rather so adroit at social forecasting that they saw a vision of the future as they were articulating on their empirical observations of the present society.

So, fellows out there, prepare for the months and years ahead. We are headed towards those stormy months, years, maybe even decades. How the future society will come to shape is not easy to forecast. “Something blurs the Force, darkens our sight of the future,” declared a Jedi Master in the Star Wars cinema fame. Let me end right here.

[Writ 22 August 2008, Quezon City, MetroManila.]

NEO-NATIONALISM’S PREMISES & CONTENTIONS / Shift intervention from the ‘provider state’ to the ‘enabler state’

January 28, 2015

 

NEO-NATIONALISM’S PREMISES & CONTENTIONS / Shift intervention from the ‘provider state’ to the ‘enabler state’

Erle Frayne D. Argonza

The failure of neo-liberal policy regimes does not mean that the state should go back to a full interventionist role, performing a guardian regulator and ‘provider’ for all sorts of services. The problem with the excessive ‘provider’ role is that it had (a) bred rent-seeking on a massive scale among market players, (b) reinforced dependence among grassroots folks who have since been always expecting for a ‘Santa Claus state’ to provide abundant candies, (c) produced new forms of rent-seeking, with civil society groups serving as the beneficiaries, and (d) further reinforced graft practices in both the public and private sectors. Thus, the ‘provider state’ further reinforced the patron-client relations in the various spheres of life (‘feudalism’ is the term used by Maoists for clientelism), consequently dragging all of our development efforts into a turtle-paced sojourn.

In the new intervention mode, the state, armed with a leaner organization and trimmed down budgetary purse, performs a superb catalytic role. It engages various stakeholders in the growth & development efforts, challenges them to directly embark on development pursuits, and demonstrates unto them how welfare can be accessed to through alternative means other than through the state’s baskets. As the state continuously engages the stakeholders through dialogue and cooperation, institutions will also become strengthened along the way. The state will gain its esteem as an ‘activist state’, while at the same time receive acclaim as a truly ‘modernizing state’ as it propels society gradually away from clientelism towards a context marked by rule-based (modern) institutions, citizenry and dynamic/autonomous constituencies.

However, within a transition period from ‘maximum provider’ to ‘maximum enabler,’ the state should continue to perform a provider role in such areas as education, health and such other human development concerns that are, in the main, crucial to building national wealth. Combining state regulations and at the same time giving ‘fiscal autonomy’ in tertiary education and vocational-technical level would remain to be a fitful strategy of ‘minimal enabler’. A similar strategy will have to be applied to some other economic sectors to be able to advance gender equity, by recognizing rights of marginalized gender to education, employment, representation in managerial positions and other related concerns.

[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.]

SOCIAL CAPITAL FOR MINING

December 9, 2013

SOCIAL CAPITAL FOR MINING

Erle Frayne D. Argonza

[Note: The author is a political economist and social development consultant. The paper was delivered in a panel lecture at the Kamayan Forum, Kamayan Restaurant, Manila, 12 noon-2 pm, 19 November, 2004. See also: http://raefdargon.blogspot.com]

This paper advocates for an alternative framework regarding mineral resource extraction. It begins with the contention that mining must be considered as primarily a community undertaking, whether the community be national or local. As such, mining must necessarily depart from market-driven models of extraction, or from state-centered models of development, and proceed to a community-oriented or constituency-based engagement.

To be able to comprehend the theme of this paper, let me begin with a story. About four (4) years ago, a former university student of mine at the University of the Philippines Manila informed me that a mining engineer wished to establish a (mining) foothold in the Cordillera. Accordingly, the engineer heard about my mystical background, and was interested to know if there are indeed precious metals in the proposed project site. That is, the engineer expected me to communicate directly to the invisible elemental entities in the area and ask their permission to establish a mining project.

Not only that. Having heard about my background as a political economist, with diversified interest and studies in indigenous culture, the mining firm he represented wanted to know what acceptable methods to employ in flushing out the indigenous people residing in the area.

To cut the story short, I declined the offer, even as I registered my vehement opposition to the sordidly profit-oriented venture of this engineer. If mining has to prosper at all, it must begin with the reality that there are people who have been settled for many epochs in the area of extraction. A win-win solution to the mining problem must be executed, not by expelling the local residents but precisely by involving them in the venture.

Let me now share to you another story. In 1998, at the height of the Asian financial crisis, my consulting firm then, the Phoenixkonsult, contracted a project with a client. The project was about yellow clay extraction, with Bicol as the project site. In a small town in Bicol is found yellow clay, a rare material that has various industrial applications as well as aesthetic uses. Incidentally, the area also has some Aeta-related residents as well as marginal peasants.

Being then the board chair of the corporation, or being in a central position to direct the developmental strategies of the firm, I strongly proposed that the project involve the residents in a number of ways.

First of all, in the feasibility study preparation, the residents can be tapped as eco-scanners to identify possible sites where the material was highly concentrated. Also, the same residents will be constituted into a cooperative, properly trained in social entrepreneurship, and invited to be co-investors in the mining project through their cooperative. A third involvement would be to tap those residents who are physically capable enough as human resource for the extraction and production activities.

Such a scheme is what social scientists and development practitioners like myself refer to as tapping ‘social capital’. Mining should not just be regarded as investment capital, but should also consider the vast wealth of social networks—‘social capital’—that can wield tremendous powers of production. Studies in comparative political economy have shown that developmental pursuits that tapped ‘social capital’ ended up more appreciably better than those that failed to do so.

The development experiences of Brazil are particularly instructive. As documented by such social science luminaries as Peter Evans (see Evans’ works on ‘state-society synergy’), those projects in agriculture, irrigation and urban-based infrastructure and housing in Brazil where a state-civil society partnership was consistently used, turned out really good in results. On the other hand, those projects that were largely state-centered or market-driven and insulated from the community networks eventually faltered, as indicated by typical experiences in most Third World economies.

In today’s evolving global context, state-centered development has become ridiculously passé. In this old framework, the state performs the role of a ‘provider state’—giving out everything such as candies and shelter units to helpless people waiting for the ‘Santa Claus’ dole outs. Such a framework had proved to be disastrous in results. Not only did it reinforce a strong dependency syndrome among the people, it also led to vicious poverty instead of eradicating this malaise. It need not be stressed that much money went to the pocket of state officials and contracting firms’ managers through this old framework.

The new framework delimits the state’s role to that of an ‘enabler state’. In this framework, development efforts are properly the tasks of market players, who possess the investment capital, and civil society players, who possess the vast social networks of ‘social capital’. The state then builds the policy environment and strong institutions that can support and sustain various developmental efforts.

I strongly contend for a ‘social capital’ approach to mining. In this approach, the first thing to do is to recognize the institutional capacity building efforts of people who live in the areas of resource extraction. Stewardship agreements must be concurred between market players and community or social enterprises of the folks, with the state serving as a mediator or facilitator. I am very optimistic about the positive results of this scheme, compared to market-driven and state-centered approaches.

You see, when people, through their social enterprise groups, are motivated to co-direct development projects, the people themselves will do so much to zealously guard and monitor the entire project or enterprise venture. The bonus for indigenous peoples is that they have easy access to the spirit world, to the nature beings in the area (called ‘elementals’ by mystics), beings that can also be tapped to guard the project.

Now, go back to the cranky old models (market-driven and state-centered), and remove the indigenous peoples from the scene of a gargantuan development effort. What will you have?

It would be instructive to recall the Celophil and Chico dam projects, both Cordillera-based, that proceeded from the old frameworks. The disastrous offshoots of the projects became the fuel for insurgent groups, largely peopled by the I.P.s, to wage zealously bloody campaigns against the colossal projects.

There is no further reason today for the likes of the Celophil and Chico projects to be repeated. We must have learned lessons from their failures at this juncture. But it seems that those who now wish to revive a mining sector that has been in the doldrums for two (2) decades to go the route of Celophil and Chico.

I wish not to further highlight the folly of any idea today that wishes to pursue development by expelling people like they were deadly toxins. Many advocates of win/lose pursuits are well placed in government even as they dominate the corporate sector. They simply couldn’t see the folly behind their antiquated approaches, blinded as they are by greed.

As a final statement, let me declare that the framework elaborated in this brief paper is not an official policy framework of state. Rather, it is a policy framework that should be discussed among various quarters and social sectors, the state included. The state after all comprises of a plurality of framework trends operating in a vast array of bureaucratic mechanisms. There is no such thing today as a monolithic state with a singular framework dominating the policy environment. Rather, the state is a fluid field for contestation by various interest groups that are all aiming to influence the shaping of the policy environment.

But this I am optimistic about: if given a chance to prosper, a ‘social capital’ framework for mining will sell like very hot cake. I am very sure about this forecast. And may the communications enclaves allow this idea of ‘social capital’ for mining to germinate and percolate, because whether we like it or not this will be the direction of resource extraction in the foreseeable future. Bar it from crystallizing, and the result will be more resentments leading to more vicious insurgencies. Permit it to galvanize, and the whole nation becomes heroic in the eyes of the international community for setting new precedents. So, which option is the better choice?

 

FIND LIGHT & PEACE IN BRO. ERLE ARGONZA’S BLOGS

May 8, 2008

FIND LIGHT & PEACE IN BRO. ERLE ARGONZA’S BLOGS

Gracious Day to all friends, partners in development, fellows in the Path!

 

You’re all invited to relish moments of Light-seeking reflections, call to relevant actions and self-development thoughts with me, through my blogs:

 

Development, Economics, Better World: https://unladtau.wordpress.com

 

Seekers’ Lessons, Freethought, Yoga, Self-Development:

 http://erleargonza.blogspot.com, http://raefdargon.mysticblogs.com

 

Poetry for Inspirational Living: http://erleargonza.wordpress.com

 

Happy Reading!

 

Bro. Erle Frayne Argonza / Guru Ra Efdargon

SOCIAL CAPITAL FOR MARGINAL SECTORS IN RESOURCE EXTRACTION

April 28, 2008

Erle Frayne D. Argonza

 

[Writ 23 March 2008, Quezon City, MetroManila]

 

I have always supported a ‘social capital’ framework for advancing the interests of marginal sectors in resource extraction industries. Particularly affected are the indigenous peoples and the slash & burn planters. The New Nationalism article emphasizes this point clearly.

 

I also had advanced this contention in some other articles. In a speech before environmentalists held in late 2004, I advocated for co-stewardships of mining sites with the same marginal sectors. As an official in the presidential palace, I also wrote a policy paper that stipulated the possibility of such agreements which, to my own surprise, can be legally supported by the Mining Act. This Act, to note, met enormous flak from civil society groups here.

 

The laws of a particular country may already provide entitlements for marginal sectors in the said areas, and may only need to be highlighted via research. In the USA for instance, the native Americans were able to procure concessions to co-own and manage leisure and tourism businesses that are located in their sites, and so far the concerned beneficiaries were jettisoned from out of marginalization to middle class life by this co-stewardship arrangements.

 

I am thankful to all those thinkers who argued for mainstreaming the marginal sectors via ‘social capital’. The likes of Antonio Gramsci, Mahatma Gandhi, PR Sarkar, Paulo Freire, Robert Putnam, and Peter Evans come to mind. They practically echoed the same theme: the significance of trust as galvanizing force for building social networks that can serve as ‘social capital’ for development purposes.

 

All it needs to take is political will and some ingenious methods of accounting to be able to quantify the ‘social capital’ potencies of a group of people in an area. This can be coupled with a calculation of the ‘human capital’ potencies of those who can be involved as laborers and experts of site-related industries.

 

The basic contention culled from the New Nationalism article is reflected entirely below.

 

Concur co-stewardships with communities affected by extractive industries.

 

Our mining sector had been in the doldrums for quite some time now. The production levels of both (a) base metals and (b) precious metals have surely been at lackluster levels. Meantime, logging has been totally banned to arrest further deforestration and its accompanying desertification and soil erosion. It is only in the energy sector where extraction has been impressively high, and the sector is appreciably a very dynamic one even in terms of R&D considerations. We are now at the crossroads concerning such sectors as mining and forest resources, where a revivified extraction is in the pipelines but couldn’t move because of constitutional and/or statutory constraints.

 

Note that most of the country’s natural resources for extraction are habituated by (a) tribal peoples and (b) migratory slash & burn peasants. Such populations have long ‘guarded’ the resource-rich habitats. It would surely be a faulty policy to drive them away—hidden under the euphemism of ‘relocation’—in order to give way to a mining concessionaire. Likewise would it be unsound to merely integrate some of their members as wage laborers for the extraction operations. Such actions, derived from regarding the people as ‘high disutility’ entities, are plain reactionary, even as they push the populations to the limits, leading to the folks to constitute hostile millennial movements and rebel separatists. The moves are reactionary as they contribute to the weakening of the nation, to the fragmentation of the national community.

 

The most pro-active path to address the concerned issue is to design and concur stewardship arrangements with the said populations. Three things are addressed by the stewardship: (1) the people will stay in the area, with better housing and amenities, who in turn will monitor and safeguard the entire operational sites; (2) where necessary, the same folks will be employed in the operations and administrative jobs where applicable, on a first priority basis; and, (3) the people will be co-owners of the firm, with equity/stock participation derived through a calibration of their productivity potency, historical role in stewardship of the area, and other variables. It is argued that this stewardship path is the win/win formula for the state, investors (market), and the communities concerned (‘social capital’/civil society). Consequently, the contribution to the GDP through resource extraction jumps up to a historic high level.

DOMAIN OF WEALTH OF NATIONS: BOTH DOMESTIC & OVERSEAS

April 28, 2008

Erle Frayne Argonza

 

[Writ 23 March 2008, Quezon City, MetroManila]

 

 

The antiquated debate regarding which domain should be the main source of national wealth—whether domestic or overseas—is still alive today. In the article of New Nationalism, I argued that in the emerging context of post-industrialism, this debate has become futile and unproductive. Instead of stressing a domestic versus international mindset, I argued for a both/and frame.

 

Admittedly, the overseas domain as a source of wealth is as palatable as it used to be during the era yet of the city-states of Northern Italy (Venice, Florence). This has become the backbone of mercantilism, which in turn became the backbone of nationalist economics. Old Nationalism henceforth carried the pro-mercantilist banner of seeking wealth primarily from international operations. But this time around, this position has to be revised in the light of import-substitution success.

 

In the Philippine case, we have been having it both ways. On the one hand, our manufacturing sector’s products are largely consumed 86% of the time for the domestic market, indicating the optimization of the import-substitution aspect of our development efforts. On the other hand, our overseas employment and investments have been churning out a whopping Net Factor Income from Abroad or NFIA worth 11% of the GDP.

 

New Nationalism, to my mind, should rather have it both ways, as culled from this and other parallel experiences in emerging markets. At this time particularly, Foreign Direct Investments or FDIs by Philippine-owned or controlled companies has begun to take off and contribute to our national coffers. Add to this our exports worth 40% of GDP, and remittances from labor export of worth 10% of GDP, and one can see the broad picture of the potency of the overseas domain as source of national income.

 

Below is the entire subsection on the domains of wealth production culled from the New Nationalism article.

 

Generate wealth from both external and domestic markets.

 

Various stakeholders in the past were divided along the question of what should be the driver of growth & development (demand-side discourse): the external, or internal market? The followers of the ‘externalists’ were the ones behind the export-oriented development strategy, whose rationalizations for massive exports were quite poor recycles of the mercantilist contention that wealth should be produced more from out of the external markets (colonies during the time of empires). The ‘internalists’ were the ones behind import-substitution strategies, whose rationalizations were poor photocopies of Keynesian demand-side formulations.

 

In today’s context, it is wiser to view both the external and domestic markets as synergistic spheres for accumulating national wealth and meeting head-on the demands for delivering welfare. The external market discourse can work only in circumstances where a domestic demand has failed to develop, which in our case was the pre-1990s economy. By the late 1990s, it was clear that a significant change had taken place on the demand side of our economy, as folks were buying a lot of articles of commerce at a time of crisis. The middle class population is rising relative to the entire population, whose households’ needs have become more differentiated and have leaped beyond the bounds of ‘rice-and-galunggong’ expenditures. Today, Filipino families purchase around fifty-three percentum (53%) of their household needs from supermarkets, malls and large retail centers, even as the wet markets and sari-sari stores are declining in importance. These changes are real, and we cannot be blind to them by continuing to harp on an export-driven growth.

 

We must then fast-track large-scale redistribution schemes, such as to witness the rise in purchasing powers of our own people. This cannot be done outright during the next three (3) years, as we face a fiscal dilemma of crisis proportions. But beyond 2007 lies new opportunity fields. The fiscal route to stabilization will have been solidly achieved by then, and the nation can embark on more ambitious endeavors aimed at increasing incomes, reducing unemployment and poverty and increasing domestic consumption.

 

As the domestic market catches up in stabilizing the economy and producing national wealth, stakeholders shouldn’t be remiss in improving the competitiveness of our export products. Our great advantage is that we have ample supplies of skilled labor, with wages still relatively low. The power sector is also quite rich in supply of electricity, even as new projects are now being planned to neutralize possible supply problems in the short run. Hopefully, power supply would stabilize and electricity cost would decrease, contributing thus to rendering our exportable articles more competitive enough. Save for capital goods and petroleum, large volumes of which our producers continue to import, the other factors of production are within our hands to control and manipulate, inclusive of rent and interest rate. It is hereby argued that, with such factors controllable enough, we can optimize conditions for rendering our exportable articles maximally competitive and continue to permit the external market to be a source of substantial wealth. What more if we produce all of our essential capital goods, thus further bringing down the cost of production, given that the price of other factor inputs also go down?