The Parable of the Good Father and National Five-Year Plans

A good father went against his instinct and let his second son go out on his own, out of the protective confines of his (the father’s) world, into the world outside. He would not have done so, knowing how cruel and difficult it was to learn the pitfalls of life on this earth. But his second son was so much independent than his first, and he felt that he had imparted enough character into this one for him to survive on his own. So let go he did.

The first son, who followed his father’s footsteps, was successful in the beginning, running the family business as he was trained to do. When the good father died, however, he lost his bearing and could not make decisions. Instead of doing something in most business situations, he waited for something to happen. Eventually, he drove the business to oblivion. The second son, as it turned out, also prospered on his own, founding his own empire that lasted beyond his lifetime. The father’s fears about the second son turned out to be unfounded.

Now the above is just an anecdote, and half of it is fictional. (I am thinking of the defunct Wang Labs for the non-fictional half.) My purpose here is simply to illustrate that, in the trainable animal universe as much as the human one, once an offspring has attained enough character (good habits and survival instincts), it is better to leave that offspring alone to make his/her own decisions. It does not matter how much natural talent she has, once an offspring gains the freedom to decide and learn lessons on her own, her success is almost assured. Protecting the offspring, or getting involved in planning his/her future, only serves to ease the parents’ worries, but does not really help the offspring in the end.

Whenever we intellectuals talk about the welfare of people in our country, we are like parents. Our instinct is to protect and plan, and thereby control. The five-year plans we propose consist mostly of what the government can do to the people, not what control it can phase out in an orderly manner. We propose to have the government encourage, initiate, or even build industries, as if we have the magical powers to decide correctly which industries would be good. We believe, for example, that the export industries was what made Japan and Taiwan successful, so we decide on behalf of the people that the government must be active in favoring export industries.

My idea of government is that it should do NONE of these. It should focus on its proper role, and for me the proper role of government is summarized in the Bill of Rights, which fortunately is also part of the 1987 Constitution. It should respect and enforce contracts, it should protect individual freedoms, it should resolve conflict among citizens whenever it is called upon to do so. It should refrain from being too benevolent. It should follow the rule of law not only when resolving conflicts, but also to control itself.

Many have argued that that is what we have been doing in Pinas, that we have had enough freedoms, and it has not worked. Many of us just cannot understand how restrictions on foreign investment are a big drag, that the process for starting a corporation is too cumbersome, that business in itself is generally beneficial. I agree wholeheartedly that our immediate goal should be to change our Constitution, in order to remove restrictions on foreign investment. I can see the near-term benefit of increased job opportunities, but that would not be my long-term goal. My long-term goal is to increase economic freedoms: not just the freedom for individuals (and thereby also corporations) to accept foreign investment, but also to engage freely in any business that is not harmful to anybody. For example, some intellectuals would impose controls to direct investments to certain industries (as is the practice now). Such controls are not necessary. If I want to engage in an import business to satisfy the need for some imported product, I should be allowed to do that. Too many of us are against this because it would appear to be detrimental to local industries producing the same product. This is the instinct of intellectuals even in developed countries. If my import business prospers, there will be more such businesses, which can only benefit the people, because of competition. How can we determine that an import business is not beneficial? The people themselves determine that, by not buying the imported product. Too many of us would rather that the government decide, which then grants those in government enough power on the people. I wonder why it is difficult for most of us to see that by itself, this power over the people is corrupting.

If we freely allow imports, not just of capital but also of any commodity (just as Hong-Kong does), I predict that the prices of commodities would track international prices. This has already happened with the liberalization of fuel imports. Gas prices at the pump in Pinas now mostly track international prices, despite incessant complaints from the public utility industry. It will only remain a political headache if we continue to insist on price controls on jeepney and other public utility fares. In other words, liberalizing one industry is not enough, we have to liberalize across the board as much as politically feasible. This is why I have also concluded, independent of Mr. Orion Perez Dumdum, that our first immediate priority is to do away with practically all parts of the 1987 Constitution except the Bill of Rights.

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What is Freedom?

I challenged a discussion group, whose members are graduates of my alma mater, to think about why our motherland Pinas is behind in a lot of areas. Somebody responded that may be we need to be more generous, and really care for the poor.

I am generous, and I see what he is saying, but I have a different view of what is virtue, and therefore of what is good for the country. I have just re-read Rizal’s Noli Me Tangere and El Filibusterismo, hoping to see in Rizal’s ideas something similar to my own. I do admire the stories told in these two great novels, but I did not see exactly the ideas I was looking for. May be it’s there and just did not see it.

What I am looking for is a definition of what is freedom. To the communists, the ideal is that everybody gives, not to the poor, but to a ghost called “the common good”. Their big problem is that if someone doesn’t get it, doesn’t get the ideal, he is punished for it, and punished heavily. In the end, the freedom from want that is sought, for the common good, leads exactly to the opposite, which is total control of a whole population.

God gave each one of us the means to survive: we have our own limbs for making food and building shelter, our own minds to make decisions for ourselves, and our own stomachs to feed. Of course, there are some who are unfortunate, and I would love to spend time with them not as a benefactor but just to chat. But the unfortunate ones are an exception as much as those brimming with talent are also exceptional. God equipped us mere mortals of the means to survive. God did not equip us with a giant stomach to which we are all connected to get sustenance. He gave each of us our own digestive system. He did not create us with only one brain shared by everybody, and so I believe that what He has in mind is freedom for each of us.

What kind of freedom is most appropriate for us? I don’t think it is freedom from basic wants. We all aim for an abundant society, but none of our basic needs can just come down as manna from heaven. If we define freedom as freedom from want as opposed to the freedom to work towards our purposes in life, purposes that do not harm anybody else, then we will gain neither the former nor latter type of freedom.

Many people confuse freedom with the absence of rules. The absence of rules leads to anarchy and therefore also loss of freedom. Freedom is simply allowing people to do good, to be the best in what they do, while not harming anyone else in the society they live in. Instead of the common good, I think it is much more virtuous to think of the primacy of the individual. Rules are there to protect the individual from society, and it is only in fewer cases where we need to protect society from the individual. After all, there are much fewer criminals than good citizens in Pinas. For me, the term “rule of law” is meant to limit the government instead of constraining the individual. The ideal situation is that in which the government is simply a mechanical signal light, unforgiving and indifferent in its application of the rules; but as a functioning traffic signal light, it prevents us from colliding with each other. It does not tell us where to go, it just prevents us from running into and harming each other.

And so by building our ideas (of how people should live in society) on the foundation of the primacy of the individual (as opposed to the common good), I believe we will gain more freedom and prosperity. The system that we come up with will not guarantee equality of outcome and freedom from want, but it should guarantee equality with respect to application of the rules. In Pinas we have always strived for equality of outcome, but for as long as I can remember we have always had the poor getting poorer and the rich getting richer, and it is not too often that we find equality before the law either. The common good is not good for everybody after all. The common good is just a figment of a politician’s imagination, but you and I as individuals are real.

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What is Money?

The love of money is the root of all evil. 
1 Timothy 6:10 (King James Version)

He had heard people speak contemptuously of money: he wondered if they had ever tried to do without it.
W. Somerset Maugham
Of Human Bondage.

Very few people understand the digital and radio technology that makes cell phones possible, and yet practically all of us use it. Very few people understand what is money, and yet all of us earn and spend it on a daily basis.

Why was money invented? Why did it have to come about? If we can answer this question, we can begin to understand what is money. Let’s go back to pre-historic times when there was no money.

Peter was a caveman. He was good at making stone tools. In his cave he had stashed several arrowheads which he had carved from pieces of stone. David, Peter’s next cave neighbor, was good at picking fruits and drying them. In David’s cave, one could find baskets of dried fruits. David had to protect his dried fruits from nasty robbers, and for that purpose he needed a weapon like a bow and some arrows. Peter, on the other hand, needed dried fruits to feed his family. David and Peter then did what is now called “direct exchange” or, in simple terms, barter: some quantity of David’s fruits for one of Peter’s arrowheads. In this case, money was not necessary, and direct exchange in fact means “no money”.

Now Mary came along. She was good at making baskets. She offered the baskets to David, but she didn’t need fruits. David did need the baskets. Would Mary have any use for arrowheads? If she did, direct exchange would still be possible: David could give Peter some more of his fruits for one of Peter’s arrowheads, which Mary could then accept in exchange for a basket. What if Mary had no need for arrowheads? Then no direct exchange could have been possible among the three, and this was the situation that necessitated the use of money. Money in this case was what Peter, David, and Mary recognized as valuable, convenient, and could be exchanged for any of the other valuables: fruits, arrowheads, and baskets. And so it happened that David told Mary: “I have these beautiful shells which I have collected, would you accept two of these for one of your baskets? You can take these shells and exchange them for anything else you might need.” And that’s how money came about.

Money allows for specialization of labor. I do not have to plant my own rice or corn if I can exchange money for rice or corn. I can specialize in making baskets because I can exchange the baskets for money, and that money can be exchanged for anything else. Money also allows me to be free to decide how much to produce and how much to receive. If I were a slave and am told to produce a certain number of baskets, I would do so only because I have no choice. Being a freeman in a society that allows the use of money, I can choose both what to produce and how much of it to produce. Money allows for an alternative societal organization that does not require the use of force to make people act.

As more people used money, as technology advanced, and as human organizations became more complex, the thing used to represent money became more sophisticated. Metals like copper and silver were used, and also gold. The need for money preceded the need for government, but eventually government took over the administration of money.

Soon it became necessary to store gold in banks. It used to be that all the banks did was store money in the form of gold. But paper and ink allowed the banks to more than just store gold: each owner of gold stored in the bank was given a certificate of gold ownership. This certificate eventually became the medium of exchange (in addition to its other functions, like in the transfer of value from one generation to another). It was more convenient to hand a piece of paper to the seller of that horse than take a certain amount of gold from the bank. The horse seller, in turn, used the certificate for other transactions, with the tacit understanding that the certificate was worth a certain quantity of gold stored in the bank. Banks soon discovered that they too can just issue certificates to lend to borrowers or pay their dues. It did not matter which bank people used because all of the banks recognized each other’s certificate. Paper money thus came into being. The story differs from one country to another, but in general it can be said that when paper money came along, most governments were not involved.

As with anything new and untamed, paper money was abused by some banks. Some banks overprinted and lent paper money, many more times worth than gold that was stored in their vaults. This went unnoticed as long as only a few people claimed gold in exchange for the paper they were holding, but if enough people claimed gold for paper money, a bank inevitably collapsed. The collapse of one bank can have a domino effect and collapse other banks as well. Whenever this happened, it was a major disaster and people suffered.

The government had to step in and reign in the banks. Laws were promulgated to limit the ability of banks to print money. This did not fix the problem of inflation and runs on banks, however. And soon, for lack of a better alternative, lawmakers thought it was best for the government to take over all matters pertaining to money. Now practically all nations have central banks charged with regulating all other banks, and the value of paper money has been completely dissociated from gold. Central banks can print paper money (“fiat money” because it is all based on our “trust” of the government) as much as they see fit. The only constraint in most countries is that they do it to improve employment levels and to refrain from doing it when there is too much inflation.

Free market advocates like me believe that there is too much power concentrated in governments for managing the value of money. Whether inflating or deflating, sudden changes in the value of money reduces its effectiveness as a feedback signal that determines how much of any commodity is produced. Moreover and more importantly, inflation of the value of money serves as a vicious hidden tax on the people. When inflation occurs, it is very easy for politicians to blame businesses for the increase in prices, when in fact it is totally the government to blame for mismanaging the value of money. We all suffer when fiat money loses a lot of value, and most of us blame the wrong people for it.

Is it possible to remove money from the clutches of government? Do we really need government to assure us that one peso or one dollar is worth something? We will soon find out because there are now several attempts afoot to use computers and theInternet to introduce a new form of money. One is called BitCoin, a completely digital money system devoid of any government guarantee.

I see several problems. One problem is the classic chicken-egg dilemma: I could only use Bitcoin if stores accepted it, and stores would accept it only if there were a lot of people using it. The stores would only equip themselves with the necessary hardware and software to be able to accept Bitcoins if there were customers wanting to use it, on one hand. On the other hand, customers would use it only if the stores were so equipped.

It is not enough that I trust that nobody can tamper with my money stored as Bitcoins.

I think what is needed is for some established business, ideally a very big and reputable company, to back Bitcoins. Such company will only do it if it gains something out of doing so. And even if such company decides to go for it, there is no guarantee that the government will not intervene. And so then we’re back to where we did not want to go.

I believe we are still far from a viable solution to the money problem.

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To All Filipino Intellectuals

You and I both want Pinas to progress. We may not agree on the exact destination, but I think we can both agree that the current state of the country is deplorable. I have visited Malaysia and Indonesia, and have lived in both Japan and the U.S. We are way behind in terms of modernization, and by that I mean the same kind of modernization that Mahbubani in his book “The New Asian Hemisphere” meant: abundant jobs, sanitary toilet bowls, clean and peaceful cities, a government that does its job, etc.
 
For me, the question to ask is “what is the way to progress?” Not “what should we change in the Filipino people (so they can march towards progress)?” The first question does not imply that the Filipino people needs to change first before progress happens, the second certainly does. There is nothing wrong with the Filipino people: nothing wrong with our desires, nothing fundamentally wrong with our habits, nothing wrong with our will to change either. My proof to you is all the Filipinos who live and work outside of Pinas. Most of the millions of us who live and work outside are working hard to improve the lives of our families back home. We do not depend on dole-outs, we do not depend on anybody else to sustain us, we depend on ourselves to earn our living. Why is it that we have to go outside of Pinas in order to progress (in some cases, in order to survive)?
 
What is there in other countries that we lack in Pinas that we have to get out and get? The answer is simply: jobs. We do not have enough jobs in Pinas. Why is this? Why is there not enough jobs in Pinas? Is it because we are overpopulated? The answer is not as simple as that, and in fact, my position on population is that we are in no way overpopulated. We are smaller than Japan in terms of population per hectare of arable land.
 
Jobs do not come from governments, although in Pinas a government job is certainly desirable for its stability. Only a very tiny proportion of jobs are government jobs, and to increase it by more than its proper share would not be good for the economy (because a government job is not a job that produces, by definition). Jobs come from the private sector. And this is where I think a large part of our problem lies: our private sector is weak. Our laws mostly discourage business and the emergence of new business. We do not have enough capitalization, which can mostly only come from the outside.

Let’s compare ourselves to our neighbor China. China started changing its ways in the 1980’s. We were ahead of them in the 1980’s, and look where we are now compared to them. They instituted free market principles then, while we enacted a socialist constitution in 1987. Our 1987 constitution has constrained our progress, while China’s reforms have catapulted them from a languishing giant to the second biggest economy in the world.
 
Now China can change its course so easily because they are a dictatorship. I agree with you that it won’t be so easy for us, not because my ideas are lofty, but because we are a democracy. Now I am not saying that democracy is bad. In fact, democracy is one thing that China does not have that they now need badly. It won’t be easy for China to be truly democratic, and I’m sure that it would be easier for us to institute free market principles than for them to turn democratic overnight. In our case, all we need to do is change our ideas of progress. In their case, they have a mountain of a job to dismantle the stranglehold of the communist party in their government. It may require a bloody revolution in their case; in our case, all it requires is years of planting seeds in intellectuals like you.

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On Reading Jose Rizal

To write is to lay bare one’s soul, in so many words, for all to see. To read a book, then, is to look into the soul of its author.

I have just finished reading Leon Maria Guerrero’s highly readable English translation of Rizal’s “Noli Me Tangere” and am now moving on to its sequel “El Filibusterismo”. My purpose in this, to look into Rizal’s soul, is to inquire about his ideas on freedom. I want to see how Rizal’s ideas of rights and freedom match either the socialist or capitalist notions of rights and freedom. Rizal wrote these novels in the late 19th century, about a couple of decades after Karl Marx’s “Das Kapital” and about a century after Adam Smith’s “Wealth of Nations”. Was Rizal more influenced by “Das Kapital” more than by “Wealth of Nations”? Or was it the other way around? This question requires another blog piece, which I will write later.

The premise I start with is that Rizal was a genius, but like all of us mere mortals he was a slave to ideas he had been exposed to. Many people claim that they are practical and are not influenced by any abstract idea, not realizing that by going to church or watching any movie, they are influenced by one intellectual or another who is in turn influenced by an original thinker. The fact is that every belief we hold can be traced to an original thinker who has written about it in the past. Even great thinkers themselves had to start from truths already established before they contributed their own original ideas.

Imagine that you are an actor or actress in a movie. You assume the personality of a character, and every word that comes out of your mouth follow a script. In real life, we also follow our own scripts. We live our daily lives according to our script, a dynamic script that itself may or may not change slowly as we experience our existence. Life is a script, but we have the power to change that script. We can author our lives to be either contrived to be tragic or designed to be triumphant. Rizal has authored both his life and Noli Me Tangere to be tragic, but his genius is that deep within his tragedy is hidden a seed for hope and eventual triumph.

Small minds, in an attempt to hide their limited expanse, reduce the stature of great minds by focusing on the wrong aspects of a great person’s life. The documentary film “Bayaning Third World” focuses on the wrong questions as to lose the meaning of Rizal’s life altogether. One question that the film focused on is whether Rizal retracted all his writings just prior to his execution. One cannot retract full contents of books in a page of denunciations: it requires books to retract one’s soul laid bare in prior books. What exactly was being retracted? What logic was followed to arrive at an opposing conclusion? Rizal’s alleged retraction, even if it were true, is relatively an insignificant event compared to the structural beauty of his plot and the grandeur of the characters in his novels. Instead of focusing on his warts, we should rather be focused on Rizal’s outpouring of his soul in his novels and other writings.

Reading a book written by somebody who lived some time ago is like listening to a dead person, who comes alive through the pages of that book. Digital technology can help us push this idea of dead persons talking one step further: what if we can freeze Rizal’s script and play it in the present world? “Bayaning Third World” uses a literary tool in which a character in the present talks to another character in the past. Aside from the fascinating effect of making a dead person come alive, this poses in fact a real possibility with the advent of digital computers. When we Google a phrase, we are basically asking a question for all of the Internet to answer. Google basically searches the whole Internet to find answers to questions. We can come up with a smart program (smarter than the Google search engine) that embodies all of Rizal’s written materials, including all the logic employed in his thinking. This program can then be a static representation of Rizal’s thinking (by “static” I mean no emotions and no maturation process), a static version of the script by which our national hero lived. We can then ask this automaton (who thinks he is Rizal himself) any question we want. My very first question would be not about his retraction, but about his ideas on freedom.

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Mahbubani’s “The New Asian Hemisphere”: a review

There are two aspects to this book. On the one hand, the book does a very good job of narrating exciting history that is unfolding here and now.  It lucidly tells how both India and China have adopted free market reforms to jumpstart their economies. It talks about the modernizing effects of the free market in terms of dramatic improvements in physical comforts of billions of Asians like flushing toilets, cell phones, cars ,etc. On the other hand, the book also offers a prescription for the West (U.S.A. and Europe) to fix their inability to continue to lead the world in peace and prosperity.

I have no problem with the first aspect of the book. I agree wholeheartedly that free market principles, even when applied from the top down in a previously command economy, can work. My beef is with Mahbubani’s prescription for the West. He advocates what he calls “geopolitical pragmatism”. In Mahbubani’s view, the West is intellectually stuck in its superiority complex and cannot put aside its ideology even for a moment. The foreign policies of China and India, on the other hand, are held up as exemplars of effective geopolitics.

The book was written in 2008, the dawn of the Obama regime in the U.S. Let’s review some of the more important policy prescriptions recommended by Mahbubani, determine whether Obama is following each one or not, and check the results so far:

Engage with Muslim Fundamentalists

India is more effectively dealing with the problem of Muslim fundamentalism by its humility (although it has not been spared from Muslim terrorist attacks). China has been equally silent in its diplomacy towards fundamentalist countries, eschewing the use of any propaganda construct such as Bush’s “axis of evil”.

Obama’s foreign policy is 180 degrees out of phase with that of Bush. As Mahbubani has prescribed, “Obama has consistently said he is willing to meet, without preconditions but with preparation, the leaders of Iran” (source: Obama-Biden website). He delivered a speech in Cairo in June of last year that was clearly in line with what the book says America should do: admit the West’s failings, praise the merits of the Muslim faith, and even sprinkle the speech with quotes from the Koran.

There is no evidence that Obama’s foreign policy is improving relations with Muslim countries. In fact, there is evidence for the opposite effect: a couple of polls have indicated that hatred for America among Muslims has not abated. Terrorist attacks have not decreased either. Could it be that the Muslim religion is irreconcilably incompatible with prevailing Western ideals? Mahbubani, like Obama (and even Bush himself), would not even entertain this possibility.

Strengthen the United Nations

Mahbubani reminds the West that it is the bearer of the wonderful gift in the form of the U.N. Charter, and that it only makes sense for the West to continue to uphold the charter and strengthen the U.N. The West has instead ignored the U.N. Charter by imposing its will through the Security Council.

Obama is also in favor of strengthening the U.N. and agrees with Mahbubani that the U.S. has been inconsistent with regards to its objective of spreading democracy. In a September, 2009 speech to the U.N. General Assembly, Obama declares that “Democracy cannot be imposed on any nation from the outside. Each society must search for its own path, and no path is perfect. Each country will pursue a path rooted in the culture of its people and in its past traditions. And I admit that America has too often been selective in its promotion of democracy. But that does not weaken our commitment; it only reinforces it. There are basic principles that are universal; there are certain truths which are self-evident — and the United States of America will never waver in our efforts to stand up for the right of people everywhere to determine their own destiny.”

Bush has left the Iraq war in much better shape for America than at any time during his tenure. When Obama took over, out of respect for the sacrifices made by American soldiers, Obama should have used America’s unquestionable influence in Iraq and made sure that the last election resulted in a stable government. Instead he focused on drawing down the number of troops (as he promised) and so until now there is no clear leader in the Iraqi government. Terrorists have taken advantage of the situation and have killed scores of civilians while the draw-down is occurring. Obama’s policy here is consistent with standing up “for the right of people everywhere to determine their own destiny”. However, he is himself inconsistent in this regard because he has clearly intervened in the case of the Honduran coup d’etat when his administration sided with Zelaya and ignored the judgment of the Honduran supreme court.

Give Up Stranglehold on the IMF and the World Bank

The capital initially used for IMF and World Bank loans came from the West, and so it made sense for the West to require that the heads of these institutions be either European or American. However, Mahbubani claims, after borrowing countries have repaid their loans, leadership of the IMF and the World Bank should now be based on meritocracy without regard for country of citizenship. The money in these banks now consist mostly of interest paid, and the original capital has diminished its ratio with respect to the total, thereby also diminishing the right of the West to assign executive leadership.

Judging from how much importance the Obama administration has given to the G-20, we can surmise that they are in favor of this policy prescription.

This has not happened yet, and so the result is unknown at this point.

Amartya Sen

Mahbubani subscribes to the ideas of Amartya Sen. He views freedom in layers, with freedom from want elevated as the most fundamental freedom: “A human being who cannot feed himself or his family cannot possibly be free.” This view is clearly the neo-liberal view, at odds with the classical liberal definition of freedom: basic individual rights protected by the state. Before any human being can feed himself or his family, the food he needs has to be produced first. History has shown us that if the state is given the power to distribute the fruits of labor in any society, production can diminish to famine levels.

Obama is a neo-liberal and likewise can certainly agree with Amartya Sen.

The result of this policy, although applied domestically in the U.S. and not as part of foreign policy, is Obamacare. Obamacare is a horrible usurpation of one-sixth of the U.S. economy by the government. It will eventually lead to rationing of health care.

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Long Term Potentiation

Long term memory in the brain is realized partly by weakening irrelevant connections and strengthening relevant connections among neural cells. Connections that become strong can still become weak if not exercised. Our long term memory is not like computer Read-Only Memory that can be burned once and then assumed to hold forever.

Why this foray into neurology? It took me some time to understand some ramifications of the dictum that “we are creatures of habit”.

We now know that, although difficult during adulthood, bad habits can be broken, and good habits can be formed. Good parents know that good habits are easier to form in kids than among adults, but even adults can regress. We also know that, as much as there are good and bad habits, there are also good and bad ideas. I was of the impression that good ideas, once discovered and elucidated, can speak for themselves. Surely, some kids already know what is bad from good, so why do they still do bad things? It was not clear to me that certain habits like angry reaction can make us forget what is good and what is bad. Good ideas need defending. Good ideas need reminding. You can program a computer once and expect it to behave exactly the way you programmed it. But humans need periodic memory “refresh”.

I also thought that history should have taught us what we know today. After all, we do have collective memory in the form of books (and now also films and the Internet). I expected the world to have learned the lessons of how dictators come into power, and not make the same mistakes again. But dictatorships have come and gone again and again, causing a lot of suffering and the subjugated people to lose decades in their march to progress. The fact is that good ideas and lessons learned are not points in history to be checked and simply assumed to be henceforth practiced. Good ideas like freedom need constant vigilance. Good ideas like liberty and the free market need to be defended from one generation to the next.

We can only wish that we can build an infrastructure for freedom and assume that it would continue to exist without nourishment. But the institutions for freedom that we build are not static structures, they are more like plants that need constant nourishment and care.

I feel very excited because these thoughts have led me to decide to participate in the battle of ideas, defending freedom, property rights, and the rule of law. A year ago, I looked at myself as simply a beneficiary of free market ideas, an entrepreneur in technology. My idol was Bill Gates, and I prided in being practical and so have pursued a career in software engineering. Now I realize that there are heroes out there more worthy of emulation than Bill Gates. Right now my idol has become Jose Rizal: he fought for freedom in his time, and even died for it. I am now into the eighth chapter of Rizal’s “Noli Me Tangere” and have been jumping around chapters of two other books (Dr. Palmer’s “Realizing Freedom” and Mahbubani’s “The New Asian Hemisphere”). I feel that my life has just started, and I believe I can make a difference.

Have I turned into a Quixotic idealist? The Philippines has long been mired in intellectual purgatory. The ideas of “social justice” still prevail,and only Nonoy Oplas’s Minimal Government has recently challenged it. Ideas have consequences as evidenced by the pervasive intrusion of government into people’s lives, in spite of debilitating incompetence on the part of government tentacles like the police. We are only to blame for this because we continue to believe that the government is the answer to any problem. I aim no less than to change this intellectual climate. This is not a short-term objective, to be completed in a year or two. It may take decades, but I have proven myself to be persistent.

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Osmosis

Local communists and other rabidly anti-American elements claim that American influence on Filipino culture is so pervasive but subtle that we ourselves are not aware how most of our personal decisions are symptomatic of a culture vanquished by imperialist America. Never mind that “imperialist America” is a vaguely defined term because for communists, anything capitalist is imperialist. Such terms can never be defined precisely owing to the communist’s view that even word definitions (nay, language itself) are influenced by one’s material condition.

The process whereby one culture influences another does occur, but it certainly does not conform to Marxist theory. First, there has to be osmotic pressure in order for the process to even start. Osmotic pressure exists when one society is clearly superior to another, so that the two different levels of societal evolution create a potential difference. For example, we can say that the United States is a superior society not in one outward aspect but many: it has the most powerful military in the world, it leads in commerce, it has the highest concentration of gold in the world, it has the most successful technology companies, and so on. China was similarly superior during the centuries before Christ came, so that Japan was highly influenced by China in most of its early history.

What’s most interesting about the intellectual osmosis between China and Japan is that in this particular case the process was highly selective. In other words, rather than imitate just the external ramifications of Chinese superiority, the Japanese made a conscious and deliberate adoption of Chinese culture, politics, and commerce.

Like the Japanese in much of its history, I think we Filipinos have to be selective in what we adopt from American thinking, or American politics and culture. By this I do not mean that the government ought to select what we adopt by law: the intellectuals should be vanguards in this regard, outside of the power of government to coerce.

For example, with regards to the arts, it saddens me to see dance and song shown daily on Filipino TV that are clearly influenced by the American style. I see little originality; and things like hip-hop and rap imitated here are just pure copies. Even fashion is similarly influenced: I can’t imagine how some pop music bands and dancing teams can bear to wear jackets in this hot and steamy weather just so they look like their American counterparts. In architecture, we are similarly blindly influenced: I can’t stand to live in my rental place because it’s as Western as it can possibly be: all walls are solid concrete, designed such that the place is uninhabitable without air conditioning. I would much prefer designs with open walls, which is most appropriate in this tropical climate.

Intellectually and ideologically, it saddens me to see that, we are influenced more by the Democrats (liberals) than by the Republicans (conservatives). In this we are very much like the people of India with respect to the British: Milton Friedman observed that because socialism was prevalent in England at the time of India’s struggle for independence, socialism has become part of the Indian psyche until today. At the time of our struggle for independence, we were similarly influenced by American liberal ideals of equality of outcome and other socialist concepts.

As an example of liberal influence, the current Philippine constitution (1987) requires that the State “protect and advance the right of the people to a balanced and healthful ecology”. This vague provision which clearly resulted from an environmentalist influence has been judged inoperative by no less than the Supreme Court.

As another example of liberal influence, I would have very much wanted to reform the 1973 constitutional concept of property rights which is that of a “stewardship” (an untenable Christian Social Justice idea) rather than that of full-pledged, inalienable, primary rights protected by the constitution itself. Alas, this stewardship concept has remained in the 1987 constitution. Property rights are therefore subordinate to the “common good”. This has far-reaching consequences: like Robin Hood, the government is given the power to grab land from one citizen to another under the so-called “land reform” laws; land titles are not sacred documents, but can be revised according to one’s influence in any local office of the registry of deeds; squatters are given almost equal rights to land they occupy as the original owners; land price depends as much on the defensibility of its title as on its physical location; and other sad results.

Excessive regulation is another liberal influence in the Philippines. I have just started to setup a local corporation to do business. The contrast between the American process for corporations and the Philippine process is night and day: I spent less than an hour to fill up a form and less than $200 to setup a corporation in Washington state; while here in the Philippines I have spent countless hours talking to a lawyer and drawing up the necessary papers and complying with SEC reguirements, and I am just starting.

I have several unanswered questions about the Philippine process for setting up a corporation:

  1. Why does the Securities and Exchange Commission (SEC) have to be involved at all? In the U.S., as long as a corporation does not sell its shares to the public, SEC registration is irrelevant. In the Philippines, SEC involvement centralizes the administration of all corporations, and thereby increases red tape.
  2. Why does the SEC require a minimum investment with respect to authorized number of shares and subscribed number of shares? This basically amounts to price control of startup shares. No matter how innovative an idea as reason for setting up a corporation, the same price is given: from the most mundane corporatization of real-estate assets to the most high-tech of startups. This removes the incentive to establish startups for highly innovative ventures. It also expands the power of the SEC over banks, because banks are being used to enforce the minimum paid up capital requirement.
  3. Why can’t I start a corporation by myself? Why are four other incorporators required? Why not six? Why not ten? What’s special about the number five, the minimum number of incorporators required? This rule is so arbitrary that it defies any explanation. In the U.S. any person of legal age can establish a corporation by himself.
    Both the minimum capital requirement and the minimum number of incorporators required make it highly improbable that a corporation based on new ideas is formed in the Philippines: no Microsoft, no Intel, no Google, no Facebook, or even Baidu for us.
  4. Why is the SEC also in charge of naming corporations? The SEC requires that corporate names are unique nationwide. The SEC website features a name registration facility that’s supposed to check for name uniqueness, among other things. This name registration is required, and it comes with a small fee. However, it doesn’t seem that the uniqueness facility works. I reserved the name “Centerus Cebu”, and paid for it at a local bank. I checked on my reservation, and the name did not appear as a reserved name under my account. I tried reserving it again, and the system allowed me to register the same name again.
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Metamorphoses

Warning: this is long and may be troubling.

met·a·mor·pho·sis [met-uh-mawr-fuh-sis]
1. Biology. a profound change in form from one stage to the next in the life history of an organism, as from the caterpillar to the pupa and from the pupa to the adult butterfly.Compare complete metamorphosis.
2. a complete change of form, structure, or substance, as transformation by magic or witchcraft.
3. any complete change in appearance, character, circumstances, etc.
4. a form resulting from any such change.

I remember reading a short story, as part of my literature class at Ateneo de Manila University, about a man who suddenly found himself transformed into a cockroach. I don’t remember the author, but the title is still in my mind: “The Metamorphosis”. Now imagine how scary it must be to find yourself transformed into something that is one of the lowest forms of animal. Sometimes I feel that kind of scare in me. I’ve had a good life, and everything has been so easy and rewarding for me, but sometimes being back here in the Philippines feels like being transformed into a lower form of animal and dropped in a dark forest.

Why am I opening up my soul here by writing about my deepest feelings? Today I attended a service at my friends’ Evangelical Church here in Cebu. During the singing I felt a metamorphosis, one of a spiritual kind, occurring in me, and I told myself I was going to write about it.

Ever since man learned to speak, we have had the urge to tell stories, just to declare our existence. Ever since man learned how to write with indelible ink on paper, the urge to write has lived in us. Not so long ago, man discovered that writing on a piece of paper is very comforting, not so much because he knows somebody will read it someday, but because he feels alive when he writes. This blog feels much the same to me. It is more therapeutic than exhibitionist. I do not write for the sake of writing, however; I would rather send what I wrote to friends, than just tear it apart and throw it in the wind.

I consider myself lucky and proud that I’ve lived my younger years at a time when there has been a great upheaval in the history of man. In a small way, I have been part of the magnificent personal computer revolution, and then the Internet revolution shortly after that. Like an old soldier who wears his medals proudly, I can say I’ve worked for Intel at the dawn of the personal computer age. I was a soldier in the great campaign to spread the use of the micro-computer chip. I was involved in spreading the use of protocols that allowed the Internet to transport video packets and telephone audio signals across the world. I did my part in announcing the advent of web services shortly after XML was introduced. I have also been a software engineer in the largest software manufacturer that ever existed, Microsoft.

I do not consider myself lucky with regards to my family life, however. Due to my own shortcomings, I’ve had the worst thing that can happen to a family, happen to my family: ten years ago I lost my second son, and then my wife divorced me. Even though I have since remarried and am happy living with my second wife and two kids here in Cebu, it still feels like a curse. Don’t get me wrong: I am not superstitious, and I would rather blame myself for bad things that happen to me.

I wish I believed wholeheartedly in God just so I can explain to myself what happened. Alas, I am a lost soul, and my story has its twists and turns.

Like millions of Filipinos, I was introduced into the Catholic Church at an early age, and I was a devout Christian all through elementary and secondary school. When I finished high school, I even applied to a seminary to be a priest, but was rejected. During college, I lost my faith after readings on Karl Marx and novels by Ayn Rand (nothing could be as diametrically opposed, but Ayn Rand won me over and I still hold the same Capitalist ideas). One day, during Holy Mass in a retreat, I decided to do an experiment: how would I feel if I took the Body of Christ during communion and chewed on it? Since my first communion, I have been taught to hold the Body of Christ on my tongue and let it melt there. As soon as I chewed the Body of Christ, something happened to me psychologically: I became happier and I never felt as free as that moment. I lost all intellectual inhibitions, and my world view changed completely. I remember it was a triumphant and happy metamorphosis.

I continued experimenting even with my kids in my first family. What if I never introduced the concept of a God to my kids, and I myself behaved like an Atheist? They both grew up just like any other kid in the U.S.: with a lot of freedom, but very confused during their teen years. I had very heated arguments with my second son. He had clinical depression, and has had several suicide attempts starting at an early age of ten. Now this part is very difficult for me to write about, and I still find myself crying even just thinking about it: One day, out of my anger, I said something unforgivable to him. I blurted in his face that if he tried killing himself again, he better do it right the next time and do it all the way. My second son was fifteen when he took his own life. My first wife divorced me not long after that.

Now I have resolved that with my second family, it is not a good idea to keep my kids from being introduced to the idea of God. They may still lose their faith when they grow up (just as I lost mine after being devout), but at least their ethics would be correct. I myself have changed my stance: instead of an Atheist, I am now an Agnostic. There is one big difference between Atheists and Agnostics: whereas Atheists are so sure of themselves and arrogantly declare that there is indeed NO God, Agnostics are much more humble and only say that there is an envelope or a limit as to what we know, and the question of God is unknowable. An Atheist looks down on believers, but an Agnostic can admire religions and those who practice them devoutly and peacefully.

I now say prayers in the evening with my two kids, Kristin 6 and Careu 5. Every evening before going to bed, we say the Our Father together, and then I ask them what they are thankful for about the day that just passed. We have been doing this for several months now, and it has become a habit like brushing one’s teeth. However, sometimes I do get in trouble: kids can discern one’s sincerity. I can feel that my explanation of what the Our Father means is lacking; and although they do their part in thinking about the good things that happened to them during the day, the good things that my wife and I would tell them were not really coming from our hearts.

Today, however, was great. I was really thankful for being at the Evangelical Church, and I suppose Kristin could feel that I was sincere. She surprised me by saying that she liked being at the Sunday School too. I was surprised because when we rejoined them earlier just after the Sunday service, she told me she did not like Sunday School at all.

I feel that by trying to be sincere to my kids, I am opening myself also to the Lord. I still feel uncomfortable writing about opening myself to the Lord; but today after the Sunday service, my nagging fears all went away. I feel I can survive here if I stopped worrying about myself and focus on serving others. I think a slow inner metamorphosis is happening, and may be with the help of my friends and more regular participation at the Bardford United Church of Christ, I can regain my faith.

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Thoughts on Philippine Elections

After enjoying half of my life in the U.S., I came back to the Philippines with the idea of starting anew. After more than a year living here in Cebu, I say I love it here. I like the warmth of my friends and the sweat running down my sun-soaked skin every time I go to the beach or go sailing.

I have to work harder to earn a living, but I still think it’s worth it if only because I have not paid one centavo in taxes. So far my earnings are still in dollars deposited at a U.S. bank, and that’s the reason I have not been taxed yet. Soon I will start earning in Pesos, and will experience first-hand how it’s like being taxed like a slave. On the other hand, living expenses here are much cheaper than in the U.S., so probably I shouldn’t complain.

If only the taxes were two-thirds lower, then this country would really be the paradise it’s destined to be.

Politically you may classify me as a Libertarian, but I’d vote Republican anytime. I love Rush Limbaugh, and I also listen to Glenn Beck and Michael Medved.

Last week, while shopping at the Ayala Center Mall here, I surprised myself by conversing in pure Cebuano with a toilet attendant. He started it: “So who are you going to vote for in the coming election?”

“Manny Villar”, I responded with no hesitation.

“You believe he is really good for the poor?” He asked.

“Yes, I think what Manny will do will be good for the poor.”

“How will it be good for the poor?”

The question startled me, coming from a toilet attendant. Normally, the level of skill required to be a toilet attendant does not include asking How. I was then already washing my hands, and I wanted to get out of there quickly because I didn’t have change for the tip. It occurred to me that replying to the question would be worth much more than any tip. “Well”, I said, “Manny Villar will make it easier to start any business. He will change things so money will start coming in from other countries. With businesses and money flowing to those businesses, we will get more jobs. YOU will get a better job than just attending to this toilet. I know you are here only because there are no other jobs available, and I know that you have to fight for this job before you got it. Is this true, what I am saying?”

“It’s true.”

“With Manny Villar running things, I, Carlos Tapang, can personally promise you that in a year’s time you will get a better job because I know you work hard and you deserve it.” With that, I stepped out without waiting for a reply.

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