Asian godfathers

I received a text from someone I know who flew by chopper to Baguio and back over the weekend. The person said “there is so much water in the fields of Central Luzon, especially the irrigation lines that feed off San Roque Dam. It’s like they’re releasing water. emergency powers?”

Emergency powers -first primarily meant to address a power crisis, now primarily aimed to address water problems- is precisely the headline today: House bill seeks ‘limited emergency powers’ for Arroyo:

La Union Representative Thomas “Butch” Dumpit Jr. said he would file the measure “on a limited scope” to address the problem, especially in areas mostly affected by the dry spell like La Union, Central Luzon, Metro Manila, Cagayan, and Ilocos region.

Dumpit noted that the entire provinces of La Union, Isabela, and Cagayan had been declared under a state of calamity by the President.

Now Dumpit makes certain claims that ideally, as he says, shouldn’t become a political football -if the claims are verifiable and come from an objective authority. This is where media, ideally, should enter the picture. Besides reporting, say, Dumpit’s proposal, and the opposition that will arise, media can clarify whether Dumpit’s claims have a basis in fact or not.

Which isn’t to say it will be easy, a hell of a lot of legwork from a hell of a lot of people will be required. Do the executive issuances Dumpit mentioned exist? Who recommended them? Is the extent of the drought as Dumpit says it is? Says who? Are the number of workers he claims as displaced, based on his own count or a credible count? And what of the recent rains?

Who has been tracking what’s going on in the management of water from San Roque Dam? An enterprising reporter would go and sniff around to see if water’s being released according to a plan, or, perish the thought, to lower the dam level and justify claims of an emergency.

I hope some of the more scientific-oriented readers of this blog might be able to help identify sources to help answer these questions.
I recently got a copy of “Asian Godfathers: Money and Power in Hong Kong and Southeast Asia” (Joe Studwell), as provocative a book as one can hope to read. I haven’t really started on it, though.

However, in Newsweek magazine, the author has an essay, Ties That Bind: Crony capitalism is stunting southeast Asia, where the author basically explains the argument of his book, which is that crony capitalism is stunting growth in Southeast Asia. His indictment is severe, and region-wide:

Despite now bullish stock markets in the region, the billionaires – with their lousy corporate governance and manipulation of local banks to provide cheap and easy alternative sources of credit – also have contributed to the worst long-term emerging-market-equity performance in the world. From 1993 – when the first significant international portfolio investments came into Southeast Asian bourses – to the end of 2006, total dollar returns with dividends reinvested in Thailand and the Philippines were actually negative. Returns in Indonesia and Malaysia were worse than leaving money in a London bank account. Singapore produced less than half the gain of the London or New York markets, with which only Hong Kong was comparable. It is a brave investor who thinks long-term equity returns will improve in the absence of structural economic change.

His particular axe to grind involves the ties between big businessmen, usually Chinese, and regional politicians:

When independence came, in the 1940s and 1950s, the region’s new leaders built on a system in which politics rules the economy. In Thailand, military leaders demanded substantial equity positions and a board presence in ethnic Chinese-run companies; the Malay political elite made its financial expectations of Chinese businessmen very clear, in what became known locally as “the bargain.” While the Thai and Malay elites stuck with established Chinese trader families, the two great Southeast Asian dictators of the postwar era – Suharto in Indonesia and Ferdinand Marcos in the Philippines – turned to unknown small-timers of whose absolute loyalty they could be sure. They were men like Liem Sioe Liong, a trader who in a few years became Indonesia’s top tycoon, and Lucio Tan, a man who once worked as a janitor but ended up as a Marcos billionaire.

I don’t know whether it’s refreshing or depressing to see a regional perspective marked by such a scathing indictment of regional billionaires and the politicians they’re cozy with.

I believe this article will make for a very interesting, and perhaps, constructive, discussion. One point Studwell makes, can be connected to the next I want to raise.

Studwell writes,

Most obviously, it is clear today that South Korea and Taiwan take political systems seriously as drivers of development. In 1997, Kim Dae Jung, a longtime democracy and human-rights activist, was elected South Korean president and set in motion the most effective reform process to have occurred in the main crisis countries. Reporting and compliance requirements in the Seoul stock market are now stricter than in Southeast Asia, and the judiciary has shown far greater independence and resolve in pursuing those whose actions contributed to the crisis. The families behind Korea’s chaebol are today much weaker than their peers in Southeast Asia.

The sort-of-related point I want to raise is in my column for today, Gerrymandering. In it, I refer to an old column by Juan Mercado titled Lilliputian Provinces, Pygmy Governors. In my column, No problem, I’d praised Cebuanos for deciding to keep their province whole. And I’ve been following Sonny Pulgar’s opposition to dividing his home province, something that seems to have become a kind of fait accompli.

For my column, I found the Administrative Divisions of Countries (“Statoids”) website invaluable. Look at the entry on the Philippines, and then compare it to our neighbors, such as Thailand, then Malaysia, and Indonesia, and even countries like India. They have been far less promiscuous at province- even city-making, than we have. This mania for gerrymandering has provincial residents like arnel cadelina asking tough questions.

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Manuel L. Quezon III.

89 thoughts on “Asian godfathers

  1. “Typically, there was a racial division of labor in which locals were political entrepreneurs focused on maintaining political power against indigenous rivals and, later, in partnership with Western colonists. Outsiders, often Chinese immigrants, were the economic entrepreneurs. So in Indonesia, the Dutch gave key ethnic Chinese traders both monopolies and pseudomilitary titles: majoor, kapitein, luitenant. The Spaniards who controlled the Philippines until 1898 named the top Chinese trader the gobernadorcillo de los sangleyes – the governor of the businessmen. In Malaya, the British and local royals sold trading, mining and other licenses to Chinese and Indian immigrants while encouraging rural indigenes to stick to farming.

    “While the Thai and Malay elites stuck with established Chinese trader families, the two great Southeast Asian dictators of the postwar era—Suharto in Indonesia and Ferdinand Marcos in the Philippines—turned to unknown small-timers of whose absolute loyalty they could be sure. They were men like Liem Sioe Liong, a trader who in a few years became Indonesia’s top tycoon, and Lucio Tan, a man who once worked as a janitor but ended up as a Marcos billionaire.

    “The lesson of the past decade has been that the relationship between political and economic elites in Southeast Asia is more enduring than almost anyone imagined.

    “As had happened long before in the Philippines, the businessmen overran the political system, blurring the traditional distinction between political and economic elites.

    “The difference is political choices that in one part of Asia are creating free societies and globally competitive companies and in another sustain a superannuated economic aristocracy.”

    TRANSLATION: imperyalismo, pyudalismo at burukrata-kapitalismo. (so Ka Amado, you could be as effective if you finesse your language just a bit).

    You say you want a revolution
    Well you know
    we all want to change the world
    You tell me that it’s evolution
    Well you know
    We all want to change the world
    But when you talk about destruction
    Don’t you know you can count me out
    Don’t you know it’s gonna be alright
    Alright Alright

    You say you got a real solution
    Well you know
    we’d all love to see the plan
    You ask me for a contribution
    Well you know
    We’re doing what we can
    But when you want money for
    people with minds that hate
    All I can tell you is
    brother you have to wait
    Don’t you know it’s gonna be alright
    Alright Alright

    You say you’ll change the constitution
    Well you know
    we all want to change your head
    You tell me it’s the institution
    Well you know
    You better free your mind instead
    But if you go carrying
    pictures of Chairman Mao
    You ain’t going to make it
    with anyone anyhow
    Don’t you know know it’s gonna be alright
    Alright Alright

    TRANALATION: “Let’s move on”

  2. “considering that, in our system of government, political power emanates collectively from the people, shouldn’t we each examine ourselves and wake up to the reality that we own the blame afterall?”

    Bencard, we’re not a true democracy. Just look at how people vote. If they’re not voting for money, they’re voting for someone with a gun pointed at their heads. Or, worse, an Artista.

    Tsk, tsk. We need a proper transitional period from a Spanish colony to a democratic republic. Where was that transitional period? The law exist, for most of our brethren, in an abstract state. Military and the police can kick your door and enter your house without warrant if they know you are a mangmang and the media is nowhere in site. We are a democracy on paper and by some magical marketing and PR management done by both government and haciendero-owned local media.

  3. Bencard,

    Besides, the powerful, the moneyed, the influential people in general are always more to blame than the masses. In all countries in the globe, this is true.

  4. I mean, apparently, except sa Pinas. Tsk, tsk, you have been victimized by the myth propagated by the elite. Binabaliktad nila pati natural na conclusion nang isang napasimpleng palaisipan.

  5. BrianB, be careful with “Spanish colony” because if you snoop closer during dinner time, those elites are more at home with Hokkienese. So if you want to get a real solution don’t be like Ka Amado. Finesse your language first. Say after me. “Fujian colony.”

  6. Here we go again,with the move on thingie,maganda na sana eh.

    SIGE NA NGA SPLIT NA TAYO.

    Seriously,who says that by going back to certain issues over and over, that we are in a standstill.

    For those calling us, the group..we are a diversified one, i have beliefs and convictions that differ from my other blogging friends here,yet we get along,somehow.
    it is all a matter of RESPECT.

    And lastly, I am speaking for myself.

  7. Watchful Eye,

    Rhetoric sometimes has the fault of not being too scientific or even logical, but only moral, righteous and truthful. Who cares what their race is, if he wears a Kastila hat, a Kastila Americana and drives a Kastila Beemer W, he’s a Kastila.

  8. cjv-

    “As i commented before in this blog, I believe that the two stage strategy of achieving social equality and then introducing market reforms as implemented in China and Vietnam (as well as South Korea and Taiwan) has a lot going for it in terms of track record.

    “…of course market reforms are part of the solution. China took off after Deng introduced market reforms in 1978. Same with Vietnam. India’s growth accelerated in the 1990’s after its own round of market reforms.”

    It should be pointed out though that the market reforms in China have predictably led to uneven development (spectacular growth in certain urban centers but retrogression in vast swathes of the countryside), replicating (but on another level of magnitude) the highly inequitable class structure of pre-revolution China. It’s quite possible that China will go through another period of revolutionary convulsions.

  9. “after that came our homegrown politicians who preferred a government “run like hell” by them than one “run like heaven” by the americans. then came the new oligarchs emerging from the rubbles of ww ii, with wealth and massive landholdings inherited from the masters of yesteryears (by hook or by crook). then as now, power goes where the money is, and these oligarchs made sure they monopolized the seats of power by keeping them within their own family as virtual chattels subject of heriditary succession. now, we have “big business” supposedly in some sort of unholy symbiotic arrangement with “regional politicians”.

    considering that, in our system of government, political power emanates collectively from the people, shouldn’t we each examine ourselves and wake up to the reality that we own the blame afterall?”

    so bencard, did you ask this same question when you sought exile and comfort out there at the height of the marcos regime, oligarchy and all its warts?

    just asking.

  10. renmin, that’s possible. China’s society is now more unequal than the Philippines. Nevertheless, the reality is that Deng’s market reforms have lifted 300 million out of poverty in 30 years. If growth continues at the current pace, then their remaining 700 million poor can enjoy the trickle down benefits and eventually become middle class in another generation. If it stops or slows down, then as you say, we may see another round of revolutionary convulsions.

    Supremo, the fact is, the Filipino Muslims are poor. As blogger caffeinesparks says:

    It suffers the highest incidence of hunger when it has vast tracts of land dedicated to agriculture. Six of the poorest provinces in the country are in Mindanao, four of them in Muslim Mindanao. – from Caffeinesparks, Why It Sucks to be a Filipino Muslim Friday, July 20, 2007

  11. “The billionaires avoid export manufacturing and its requirement for global competitiveness. Instead they prosper from concessions, monopolies and cartels in local service economies that define things like port handling, real estate, telecommunications and gaming”
    ======

    The funny thing is that stuff like this gets overlooked when times are good. Remember the boom-boom 90’s? That boom was pretty much driven not only by the massive exchange of funny money amongst the taipans controlling the assets across the above-mentioned industries (not to mention cheap money from overseas), but by rampant consumerism that pumped cash into these industries.

    It was all good for the average schmoe back then. Cheap money and cheap imports kept the average wannabe happy with lots of gadgets, malls, and ill-fitting designer threads.

    When the party came crashing down in the late 90’s, who else do we blame but the suddenly-turned-nasty taipans who over-extended, over-borrowed, and over-lent the economy to oblivion.

    We see the same parallels today — except that it is now our rapidly growing OFWs who are now funding an unsustainable consumrist class. Are we gonna demonise our OFW “heroes” too when THIS party comes crashing down too? It’s just a matter of time.

    Bottom two lines are these:

    (1) We merely latch on to one scapegoat after another as we “survive” one crisis after another.

    (2) We CONSISTENTLY fail to acknowledge the very nature of our character as a people that underpins our chronic failure to prosper.

    ======
    “so our society can do some transitional spring cleaning as a prerequisite for economic takeoff”
    ======

    This sounds too much like the primitive mindsets befitting the deeply frustrated psyche of a colonialised people. Touche. Remember how the Indonesian’s massacred many Ethnic Chinese in the wake of the 1997 currency crisis? Or how Zimbabwe evicted their European-descended landlors?

    In both cases, the aftermath merely highlighted how the indigenous people were all actually utterly clueless about what to do with all the assets abandoned by their traditional owners.

    The fact is, this sort of affirmative action doesn’t work. Mahathir found out about this the hard way when, after providing unfair opportunity to ethnic Malays, he found that even with education, ethnic Malays still tended to be less productive and less inclined to create and accumulate capital than their ethnic Chinese elites.

    Go figure. 😉

    The solution is not simple. It seems hollow-heads think that merely…

    (1) Storming the proverbial Bastille (destroyong the traditional asset owners); or,

    (2) Mandatory re-distribution of assets and capital (socialism);

    …will make a society prosperous.

    Money is not the solution to the chronic dysfunction of Pinoy society. Rich natural resources did not do anything for our society. What makes us think other assets will?

  12. renmin, your observation reminded me of one a colleague made recently, which is, that if you look at china’s recent decade of growth, it’s an eerie reenactment in a sense, of chaing-ka-shek’s prewar china.

  13. This sounds too much like the primitive mindsets befitting the deeply frustrated psyche of a colonialised people. – Benign0

    Yeah, it does sound primitive but you cannot deny the results in China and Vietnam (and even in Taiwan and South Korea who implemented genuine land reform). However, i agree that we have to go about it the smart way lest we end up like Zimbabwe. That’s why sound economic principles and real world lessons, not blind rage and racial bigotry should be the guide.

  14. Another point of digression….

    Quezon..the home province of my dad.My dad came from a very small town of Mulanay. I have discussed with devilsadvoc8 about integration and annexing,but come to think of it,just thinking of Quezon province,that won’t work.In short,in my humble opinion I am for dividing it to two for better administration.

  15. now as for those billionaire types just a week or two week old trivia. Bill Gates is no longer the richest man due to his philantrophy,now it it is a mexican who own’s conglomerates from construction to oil.

    Point is,rather than blame the Ayala’s and the Lopezes let us recognize the foundations they have set up for corporate philantrophy and corporate social responsibility.now if everyone did it it would be nice,right?

  16. “Point is,rather than blame the Ayala’s and the Lopezes let us recognize the foundations they have set up for corporate philantrophy and corporate social responsibility.now if everyone did it it would be nice,right?”

    Eh, tayo pa rin nag KoKontribute dyan sa mga charities nila. At hindi natin kailangan Charity; ang kailangan Opportunity.

  17. “I find it sad that there seems to be an abundance of racial and ethnic discrimination from all sides.”

    We’ve only just begun to defend ourselves. The sad thing is, I’m not even kayumangi and I’m sure none of the mestizo attackers here are kayumangi.

  18. “In both cases, the aftermath merely highlighted how the indigenous people were all actually utterly clueless about what to do with all the assets abandoned by their traditional owners.”

    Tsk, tsk. This Benign0 is a real racist.

  19. “Money is not the solution to the chronic dysfunction of Pinoy society. Rich natural resources did not do anything for our society. What makes us think other assets will?”

    It’s not the money or the assets; it’s the people. Didn’t you get the point of the Newsweek article? It’s these old families that are stifling economic growth. It’s natural for native talent and creativity to contribute to a country’s economy. You can included actual inventions and even minor innovations in business models. What’s happeneing in our country is that our MESTIZO CAPITALISTS distrust NATIVE INNOVATIONS. Pa-import import lang. Tapos ipagbibili sa mga poamilya nang OFW.

  20. “It’s these old families that are stifling economic growth. It’s natural for native talent and creativity to contribute to a country’s economy. You can included actual inventions and even minor innovations in business models. What’s happeneing in our country is that our MESTIZO CAPITALISTS distrust NATIVE INNOVATIONS. Pa-import import lang. Tapos ipagbibili sa mga poamilya nang OFW.”

    I agree with what you say about indigenous innovation contributing to economic development, although i might beg to differ a bit when it comes to the assertion that traditional capitalists (note that i use the more generic term “traditional” instead of a racially-based qualifier) “stifle” the economy.

    I’ve written at length about how our society and culture seems to lack an ability to create capital indigenously. Instead we rely almost entirely on foreign investment, foreign ideas, and the land-holdings-originated capital of former colonial masters to expand our economy’s capital base and realise productivity gains.

    (Note that when i refer to capital base, I use a broad definition of “capital” which encompasses physical, financial, intellectual, and cultural capital)

    Take our automotive industry for example. Whilst what were once nothing more than bicycle makers in Japan and Korea now build some of the world’s finest vehicles, our indigenous auto industry churns out the same old obnoxious jeepneys and ohnher-type jeeps that blight our streets.

    Our cinema industry (once the most prolific in the region) still churns out mediocre Tito-Vic-and-Joey style slapstick and pathetically cliched dramas).

    Don’t blame traditional capitalists. They merely put their money where the ROI is. Nothing personal. 😉

  21. my understanding is that our censuses haven’t tracked the racial composition of our population since independence. but if we’re going to go down the road of castigating mestizos, etc., i wonder if it’s either accurate or productive. in the first place, i’d think that compared to say, malaysia, our population is far more racially mixed than theirs. they can distinguish between malays, chinese, and indians; here at home going down the same road would be difficult. who is chinese, who is a spanish mestizo or (increasingly) an amerasian or eurasian? anecdotally, look at one of our favorite national pastimes, beauty contests: the products of mixed marriages dominate, and they’re the products of all sorts of unions, including that formerly most taboo of unions, blacks and filipinos.

    scanning studwell’s book, he is quite scathing about what he seems to consider chinese racial supremacists, calling lee kwan yew, for one, no different from the eugenics-obsessed racists britain’s upper class produced in the 19th and early 20th centuries; he says lee’s political views are quite similar to mosley’s british union of fascists ofd the 30s, except what lee believes in is chinese racial supremacy.

    that’s not the road we should be exploring. the point of potential, of opportunities, on the other hand, seems the productive thing to focus on.

  22. I think one strategic reason why we should not discriminate based on race is because the Philippines has great potential to be a cosmopolitan melting pot like New York. The Koreans have already started it.

    Once we sort out our political problems and become a genuine democracy, there’s no reason why we cannot attract the immigrants from China, India and other places. By that time, we will become the beacon of freedom as well as an environmental safe haven for the region. That’s why restricting the Filipino identity in terms of the color of one’s skin or any cultural affectation is self-limiting.

  23. Take our automotive industry for example. Whilst what were once nothing more than bicycle makers in Japan and Korea now build some of the world’s finest vehicles, our indigenous auto industry churns out the same old obnoxious jeepneys and ohnher-type jeeps that blight our streets. – Benign0

    If you read the book i recommended to you awhile back, you will find out that the automotive industry in Japan and Korea were a result of having real industrial policies. Compare that over here where instead of building up productive capacity, what largely takes place, in your own words, is the “the massive exchange of funny money amongst the taipans“.

  24. “my understanding is that our censuses haven’t tracked the racial composition of our population since independence.”

    The Spanish strain is not only hereditary; it’s also infectious. Genetically, according to wikipedia, only 3 per cent of Filipinos are of mixed race. Compare that to 30% in Malaysia.

  25. brian, that seems implausible. what’s their basis for saying so?

    although this essay provides food for thought?

    http://webcom.com/intvoice/emily24.html

    wikipedia mentions a genetic study “by Stanford University, indicates that 3.6% of the population have Spanish, Mexican or other European ancestries.” the numbers do not go into chinese, japanese, other asian, arab, etc. ancestries, which would enlarge the percentage, don’t you think?

    as it is, one of the related wikipedia articles:

    http://en.wikipedia.org/wiki/Filipino_mestizo

    points to a problem: “ccording to recent genetic study, 3.6% of all Filipinos possess Spanish, Mexican or other European ancestry, although the official amount of European origin among them was not specified. (It is interesting to note, however, that data gathered in the 1818 census suggests that 60% of all the inhabitants of Luzon possess foreign ancestry.[1]) These specific Filipinos would all be mestizo, since 1) the European contribution was made in the recent human history of the archipelago 2) it was not a generalised phenomenon in the overall population, and 3) the community resulting from the admixture became recognisably independent in ethnic identity, social standing, cultural practices, and linguistic heritage.”

    it would be interesting to look at where the last prewar census, of 1939, left off, considering that you would have had two additional admixtures of foreign genes: the japanese occupation, and the liberation era. add to that the postwar period of the bases.

    if this article:

    http://www.ier.hit-u.ac.jp/COE/Japanese/Newsletter/No.8.english/yoshiko.htm#(1)

    is any guide, though, making these comparisons will be difficult. it seems, according to this:

    http://www.census.gov/prod/www/abs/decennial/1940.htm

    the 1939 philippine results were included in the american 1940 results (note, based on the u.s. census, how they tracked race by population as well) but i haven’t checked it yet to see if we can find the data.

    digging around here might help:

    http://www.archives.gov/research/guide-fed-records/groups/350.html

    this is also interesting:

    http://globalnation.inquirer.net/cebudailynews/opinion/view_article.php?article_id=80221

  26. FWIW, if you want to know your genetic lineage, you can participate in the Genographic Project (by National Geographic and IBM). For USD 126.50, you can order a ‘Participation Kit’ which you can use to get and submit a sample of your DNA for processing. Unfortunately, it can only trace lineage from one side at a time (paternal or maternal).

  27. I think a more important consideration is how the Kastila genes spread through our population through psychological “infection.” I think one way of preventing infection is by taking away their right to free speech and introduce a compulsory garb that will hide their appearance. Much like a Burqa.

  28. brian, your advocacy of reverse-racism is sixty years too late. first franco sent the ships to repatriate spaniards in the 1940s. then the mass exodus of spanish mestizos to australia and america took place.

    they’re gone. much more importantly, they’ve sold out. their place has been taken by the chinese.

    but you may want to take stock of your views, which seem, to put it generously, pathological leading to dreams of genocide.

  29. “brian, your advocacy of reverse-racism is sixty years too late. first franco sent the ships to repatriate spaniards in the 1940s. then the mass exodus of spanish mestizos to australia and america took place.

    they’re gone”

    We really need to educate people about this.

  30. Wow. Manolo, those links that you provided are very interesting and informative for me. If only you can dwell more on the topics like these rather than Gloria nitpicking………….

  31. “brian, your advocacy of reverse-racism is sixty years too late. first franco sent the ships to repatriate spaniards in the 1940s. then the mass exodus of spanish mestizos to australia and america took place.

    they’re gone. much more importantly, they’ve sold out. their place has been taken by the chinese.

    but you may want to take stock of your views, which seem, to put it generously, pathological leading to dreams of genocide.”

    mlq3,

    This seems to be a much milder version of what happened to Indonesia and Zimbabwe. There was also a mass migration of ethnic-Anglos when South Africa reverted to black rule.

    “Sold out” is right. But that’s fair enough isn’t it? Capital is averse to instability and insecurity. In the end, there was wisdom in that capital flight in the 1940’s, the 1950’s and the mass mestizo migrations in the mid 60’s to late 70’s as is evident in the pathetic state of Pinoy society and economics today.

    That selling out of Pinoy society is not confined to foreigners and ex-colonials either. Today, the natives themselves are selling out and moving to places where their skills and capital can be put to more productive use.

    There was even a time shortly after the collapse of the U.S.S.R. that Russian hookers would come to Manila to seek their fortunes. Now they’re all in China, Singapore, Malaysia, and Thailand. Even to foreign prostitutes, Pinoy society is not an attractive investment.

    Kawawa nga naman talaga ang Pilipinas. 😉

  32. This sound pathological: “I think one way of preventing infection is by taking away their right to free speech and introduce a compulsory garb that will hide their appearance. Much like a Burqa”?

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