Aralin 3: Ang Katangian at Kahalagahan ng Yamang Tao

The last person who download a soft copy of the lesson got zero in the test. As I always say, download it at your own risk.

Don't tell me you haven't been warned.

Aralin 3: Ang Katangian at kahalagahan ng yamang tao ng Pilipinas

Aralin 1: Ekonomiks sa Paglipas ng Panahon

"You can lead a horse to the water, but you can't force it to drink." So goes a proverb. Download, or leave at once.

Ekonomiks sa Paglipas ng Panahon

Aralin 19: Produksyon at Kita ng Pambansang Ekonomiya

Download the slide presentation of our lesson here: Produksyon at Kita ng Pambansang Ekonomiya

3rd Grading: Reviewer

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Merry Christmas.

Study at your own risk!

To my fourth year students. If you want to pass, click this Reviewer_AP IV that I made. But if you don't because of some strange reasons, just forget about this.

The pursuit of nostalgic goals

Published in Mindanao Times 8/31/08

“The world is full of people whose notion of a satisfactory future is, in fact, a return to the idealized past.” —Robertson Davies, A Voice from the Attic

Casual or not, talks in our family seldom happened. Not that we are all reticent or mute, it maybe just one of the few consequences when most members in the family work or study. You come home, they’re already asleep; they wake up, you’re still asleep.

But when talks do happen, they often drifted to my parents’ good old days. They would recount, enthusiastically, those times when their few centavos could already buy Nutri Bun (a bread triple the size of our pan de sal today), when prices of rice and other basic commodities were way below than today, etc.

Then these recollections would end up in a rather strange desire to revive those times. “Unta ibalik katong mga panahon nga barato pa ang mga palaliton, dili unta magkalisod ang mga tao karon,” my mother would sometimes yearn.

Politicians also have the same nostalgia for the things of the past. They are profoundly conditioned by social nostalgia in solving present problems. To solve the present problems, they’ll say, past programs/solutions, which were proved to be successful, should be revived.

Nograles should heed the 'blinking red lights'

Per Speaker Nograles' logic, the only way to attract foreign investors is to change the restrictive economic provision of the Constitution---a move that obviously calls for Charter Change.

But these are no halcyon days on the economic front. The world is suffering from a global financial meltdown. And experts say, the more exposed a country's economy is to "international capital flows", the more likely it will be affected by crisis that is gripping the world.

"As globalization spread in recent decades, the pace of world economic growth picked up. Open economies, it turns out, can grow faster than closed ones," New York Times noted. "But now, as the financial crisis has turned to an economic one, it appears that those running a closed economy may be in better shape to weather the storm."

The Times added: "Kenneth S. Rogoff, the Harvard economist, noted at the International Monetary Forum in Davos, Switzerland, last week that India, which has “comparatively stringent restrictions on international capital flows,” also seemed to have the most optimists and seemed to be in line for economic growth in a year when few countries are.

“Thank heavens for the strong regulatory framework we have in our financial system,” he quoted one Indian corporate executive as saying."


Lest his cure might prove to be worse than the disease, Speaker Nograles should heed the "blinking red lights," as Mr. Rogoff put it.

It's not the Constitution, idiots!

[caption id="attachment_228" align="aligncenter" width="324" caption="Proponents of Cha-cha must be cooking something besides further opening up our economy to foreign investors. (www.bulatlat.com)"][/caption]

If we were to believe our venerable Representatives, the only reason they want to change our Constitution is to further open up our market to foreign investors. No more no less. It isn’t a ploy to extend GMA’s or any other incumbent officials’ terms. By opening up our economy, foreign investments will be flooding in.

“I am asking for an economic provision na 60-40 tatanggalin natin dahil ito palagay ko naiiwan tayo ng ibang Asian countries dahil sila open for foreign investment samantalang tayo limited ang foreign investments natin,” Speaker Nograles, the pride of Davao, was reported to have said. Apparently, he’s trying to allay fears that the administration-sponsored Cha-cha is a pretext to further GMA’s hold on power.

What a noble cause!

But the recent Cha-cha moves provide excellent case study of dogs (read: sleazy Representatives) barking up the wrong tree.

Rex C. Drilon II’s exposition (Cha-cha and foreign investment) said it all: The idea that opening up our economy so foreign investments may flow is a wrong notion. Proof of this is that Philippines has neighbors with far more restrictive economies but whose foreign direct investments are far higher than ours:

The Philippines has a neighbor, a non-English speaking, communist country where there is no freedom of speech nor free press, no religious freedoms, no judicial and legal system as we know it, no code of commerce nor code of corporate governance. It received more than $9 billion in foreign direct investments (FDIs) last year. It is a restrictive economy.

The biggest country in the region with similar sociopolitical and economic environment received $60 billion last year in FDI in spite of human rights violations, use of child labor, tainted products and is probably the world’s biggest violator of intellectual property rights. This year, its FDIs are expected to reach $115 billion. It, too, has a restrictive economy.

On the other hand, we who have been christened as the bastion of Christianity in Asia, praised for our Edsas, proficiency in English etc. only received “a little over $2 billion in 2007 and as of October 2008, we are told we are down 58 percent and will be lucky if we get $1 billion.”

So why is Philippines so aloof to foreign investors?

Our venerable Congressmen want us to believe it’s the Constitutional provision that restricts foreign investors from investing. But people like Rex C. Drilon II thought otherwise. “Corruption, uneven playing field, ineffective governance and leadership, changing rules, no sense of urgency for reforms and a negative country image, among others, are the reasons why.”

Can Cha-cha solve them all?

Time for smart government

Gone are the days when debates over the role (if at all) of the government vis-à-vis the economy centered on whether markets need big or small government intervention. With the whiplash of global economic crisis expected to hit badly by 2009, arguing if there’s a necessity—nay, urgency— for government interventions is simply not advisable. Economists of different persuasions believe that governments should. Why? Because as those who have gone through Economics 101 (Principles of Economics) with the assistance of Prof. Gregory Mankiw’s textbook know, Principle No.7 says that “The government can sometimes improve market outcomes.”

Now isn’t the time to cry over spilled milk either. Rather, it’s time to think of ways how we can get out of this—alive and kicking. Prof. Cielito Habito, for instance, argued that there is a way out of crisis if only the government acts smartly.

Relevant economics

Everyone's decision is somehow guided, if not totally governed, by economics. It is thus important to study economics to make a sound decision, one that is built on solid foundations. But the study of economics tends to divorce the theories and principles of economics from real life. And this has led countless students in the past as well as in the present to debate the relevance---or the lack of it---of studying economics.

Principles such as "People think at the margin," "Law of Diminishing Marginal Returns," to name just two, are the usual stuffs students learn in elementary economics (Econ. 101). These are useful economic tools students can use even in dealing with their own realities and dilemmas. But oftentimes students do not see this fact, partly because economics teachers don't show how economics can make our complex lives manageable. When economics teachers start to teach, they create, unconsciously I believe, a comfortable distance between what they are teaching and what is currently happening in the world.

One of the ways to address this problem is to require students to read an article that, say, attempts to marry or shows how theory and practice go together.

For starters, the teacher can recommend to students  Why Barriers Don't Matter by Barrett Sheridan to make them appreciate how time was not able to render the Law of Diminishing Marginal Returns obsolete, especially in international trade.