Budget Deficits For Whom, Deficit Spending For What

Reference to the News Article from the Philippine Daily Inquirer here:

5-month budget deficit hits P22.79B

There's cause and reason to be skeptical about this.... In principle, I am for deficit spending, and I made this argument when the PNoy administration registered a surplus in its first year in office. But then we have to ask: deficit for whom, and what for? I am all for deficit spending for boosting our mode of 'production' in employment-generating and job-creating projects, and also for the workers, the poor, and those vulnerable to become poor.

In this news article, it says that government spending has been primarily 'driven by MOOE' — that is, mainly for maintenance, rather than spending on new public facilities. My worry is that our government's economic managers are not Keynesians; most would in fact proudly claim to be neoliberals. As such, this evokes of the nightmare of the old Ramos-style justification for rampant privatization of state assets (i.e., private-public partnerships [PPP] under PNoy) to offset the deficits and that was said to be instrumental to the attainment of years of budget surpluses in the mid-1990s. 

As always, vigilance is necessary. 'Pessimism of the intellect, optimism of the will'.

Much is Expected from Merkel's Germany

With the impressive way Germany has been playing in the Euro 2012, winning won't be easy for its semis and finals(?) contenders. But, just like in life, sometimes all is needed is one good luck!

Anyway, while Merkel's tough stance and austere response on the crises in the Eurozone and EU members' sovereign debts is akin to Germany's government acting as if it's now the indebted countries' new colonial master, we should also not forget that the irresponsible, greedy, and inept political-business-financial-banking elites in Greece, Portugal, Ireland, Spain, and Italy should also be made accountable. As it's said, it takes two to tango - both creditors and debtors have caused the crises and in both of them also can we find resolutions to these crises. At this moment, however, most is expected from the strong, that is, Merkel's Germany. 

Oh well, if only football could effectively resolve the ongoing predicament....

Why the Philippines Has Remained Poor: An Important Reason

Reference to the news article here:

Henry Sy still tops Forbes 2012 list of PH’s 40 Richest

Here's one important reason the Philippines has remained poor.... 

Among many other socio-economic dimensions, this new Forbes' list of Philippine billionaires is telling about the relative backwardness of our country's productive and technological structures. Philippine capitalists are mainly merchandisers and marketers and not producers of industrial and technological goods. In effect, no productivity explosions, no technological innovation, no diversity of specializations, no huge division of labour, no high wage regime, no larger tax base for the government, etc. A country of SM or tobacco or condos won't be as rich as a country of Samsung, Toyota, or Silicon Valley!

P.S. These richest peoples in the Philippines are ethnically Chinese and Spanish. In a highly unequal, elitist, and exclusionary society like ours, it would be difficult now to catch up with the wealth of these blokes/families since they enjoy all the first mover advantages in business and the society as a whole. It's very easy for them to diversify interests and even overcome barriers to entry. We thus need a government with a vision and the will to build a mode of production conducive to wealth creation and the necessary institutions for serious asset distribution.

The Filipino Connection .... Congrats Miami!

At 4:50, there goes an expression of the Filipino connection.... Congratulations to the Miami Heat! To the Filipino-American coach Erik Spoelstra! And, of course, here's to the super LeBron James! :)

On the USD 1 Billion Pledge to the IMF: Irresponsible and Risky

Reference to a Philippine Daily Inquirer news article here: 
Palace: Philippines duty-bound to help poor nations

This issue is too important to be left to bureaucrats and technocrats. It involves people's money, especially from hard-earned OFW remittances where most of our foreign currency reserves come from. We work, we earn, we send remittances, and who are they to decide on this lending???? There must be a mechanism to democratize issues of finance (and the economy) in the country. 

Yes, Malacañang, we are duty-bound to be in solidarity with our fellow poor nations. But I'm afraid that this lending of the Philippine government of USD 1 billion to the IMF for the Eurozone is, among others, irresponsible and too risky.

Irresponsible. IMF and EU (especially Germany's) terms on Greece, for instance, will just deepen the sovereign debt crisis. It's not only debtors that are expected to be responsible, but creditors as well - the problem with Merkel's government is that it thinks the Greeks are the problem. If we do indeed care for collapsing economies in the Eurozone, we should have shared them lessons of our own traumatic experience when we have been painfully entangled in IMF and other foreign lenders' decades-long (and continuing) conditionalities and structural adjustments. 

Too Risky. My sense is that lending for sovereign debt crises is very risky especially for poor economies like ours with very limited reserves simply because there's always a big option and high probability for default. If Germany won't change its austere response or even to expand aggregate demand that Greece needs, the only way out of the crisis for Greece is to default on these onerous loans. Besides, indebted countries in Europe would only have to emulate how Iceland is managing the recovery well - through debt default, political will, and other reforms. 

The technocrats from Bangko Sentral are peddling lies that these reserves cannot be used for tangible national development projects.... Come on! Of course, you/we can! It boils down to political will!

Comparing Mahathir to Rizal: Disgraceful, Insulting!

There is this disgraceful and insulting commentary in the PDI today comparing our national hero, Jose Rizal, to the megalomaniac Mahathir of Malaysia. Within a week, Mahathir has been in the national dailies. On the 12th during our Independence Day, Mahathir criticized our democracy. Today, the birthday of our national hero, a Filipino veteran journalist simply misunderstood Rizal's social critique of colonial Philippines and completely misread Mahathir's racist/culturalist ideas and the political economy of development of Malaysia.

Lest our mainstream observers and media continue to extend blind adulation to the authoritarian, self-indulgent Mahathir, I'd rather post below Randy David's more grounded and reflective essays on Rizal's sociology and 'Indolence of the Filipinos'....

Here's a line in my thesis: " ... Mahathir remains an apologist for his perceived socio-economic and political achievements, putting the blame on a people’s culture without even questioning his own politics and economic policies."

And here's a paragraph from my thesis summing up the achievements of Mahathir's political economy:

"After two decades of neoliberalization, if the project had to be assessed of its progress vis-à-vis the overall NEP-NDP objectives as well as Mahathir’s vision for Malaysia’s capitalist development, the outcome would be frustrating and disappointing for Mahathir and the power bloc behind the project, and more so for the peoples of Malaysia who were unwittingly implicated in this particular accumulation process. Despite modest economic growth achievements for 20 years, interrupted by the crises and recessions in 1985-1986 and 1997-1998, this accumulation regime under the Mahathir government had been replete with missed targets, failures, malpractice, economic inequalities, and social injustice. NEP-NDP ownership restructuring target of 30% for Malays remained elusive (Gomez and Jomo 1997; Khoo 2001, 2006a). Big privatization projects led to renationalization (Jomo and Tan Wooi Syn 2005; Tan 2008). The BCIC and many protected Malay conglomerates failed to emulate the success stories and global competitiveness of the Japanese keiretsu and South Korean chaebols (Rasiah 1995, 1998, 2010; Jomo and Edwards 1998; Jomo 2000, 2001a, 2001b; Gomez 2009). Malaysia Incorporated had been ridden with serious issues of graft, corruption, rent-seeking, nepotism, inefficiency, and incompetence (Gomez and Jomo 1997; Jomo and Gomez 2000; Wain 2009). Both inter-ethnic and intra-ethnic inequalities deepened and widened (Jomo 2004; Khoo 2004; Jomo and Tan Eu Chye 2006). If it is any indication, Mahathir’s frustrations on the nonfulfillment of his ideals of progress and the disappointments on the Malay recipients of decades-long affirmative action have been well conveyed in a memorable speech a year before his retirement: ‘The New Malay Dilemma’, which is about ‘whether [Malays] should or should not do away with the crutches that they have gotten used to, which in fact they have become proud of’, whereas the ‘old dilemma was whether they should distort the picture a little in order to help themselves’ (see Mahathir 2002). Still, Mahathir remains an apologist for his perceived socio-economic and political achievements, putting the blame on a people’s culture without even questioning his own politics and economic policies."

Links:

• Randy David's 'Rizal's sociology of colonial society' (19 June 2010)
• Randy David's 'Rizal's "Indolence of the Filipinos"' (29 December 2007)

From OKC to Miami: Get it, Coach Spo!

Respect for these two wonderful players, LeBron and Durant.... Both deserve the championship ring - LeBron's competitive spirit and Durant's graceful artistry....

Initially, I wanted OKC to win, but I also realize that for the Philippine national pride, it would be better if the Heat's Filipino-American coach Erik Spoelstra got the championship this time around!

Some Good Prospects for the Philippine Economy

Some good prospects for the Philippine economy (i.e., 'newfound business confidence') featured in the first 4 minutes of this Al-Jazeera report....

Let's hope that the PNoy government, especially his economic team, does not squander the series of positive reviews that the country has been receiving these days from mainstream media and market pundits....

Well, I wish favourable perceptions could heal, rather than just conceal, poverty and underdevelopment....

On Mahathir's Authoritarianism and the Need for a 'Theory of Democracy for Development'

Reference to the ABS-CBN news article here:

Mahathir questions Filipino-style democracy | ABS-CBN News

Well, Mahathir has to! Democracy is dangerous to authoritarian leaders like him and his ilk! 

The more I study the political economy of Malaysia, the more I realize that there are so much to "unlearn" from its racist, elitist, corrupt, authoritarian, and unjust political relations and socio-economic development. 

But there's a very strong argument of Mahathir and all the other proponents of 'Asian Values' that I still am having difficulties to counter: that is, these guys have a 'theory of authoritarianism for development' (Why is authoritarianism conducive to capitalist development?). They also have strong empirical evidence to flaunt — Singapore, China, and Malaysia (and this may include Japan and South Korea during their catching-up period, as well as England and Western Europe during the colonial times). 

I have yet to find a 'theory of democracy for development' (Why is democracy conducive to development? Or, what does democracy have that is necessarily developmental?). What we have so far are 'normative' arguments (i.e., why should democracy come with development) like the one from Amartya Sen's 'development as freedom'. I believe this is an important theoretical and practical challenge for democratic forces to communicate with the people and show that democracy is indeed conducive to development so as to put an end to the false nostalgia of the Marcos regime which continue to arouse the imagination of countless Filipinos. 

Anyway, today is our Independence Day! Maligayang Araw ng Kalayaan, Minamahal kong Pilipinas! Tungo sa tunay na kalayaan sa kahirapan at kawalan ng katarungang panlipunan! Tungo sa tunay na demokrasya ng mga mamamayang Pilipino! 

Mabuhay ang Pilipinas!

Let sports be a sphere where natural talents bloom and refined skills contend!

Reference to the Guardian news article here:
Euro 2012: 'racism' mars Dutch training session - video

Bad day for world sports!!!
Earlier, capital accumulation in Las Vegas Boxing - "Using MANNY to make more MONEY"!
Oh well, tomorrow is another day....
Let sports be a sphere where natural talents bloom and refined skills contend!