Corruption, authoritarianism and other excuses

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THERE are countries that prosper because they keep the spirit of their people alive, keep them working harder than others and keep on making them learn.

Corruption and authoritarian practices, according to many nongovernment organizations and think tanks schooled in or supported by the West, are the key causes of the Republic of the Philippines falling behind other countries. The republic ranks as one of the lowest in terms of education scores, near the lowest in direct foreign investment, among the highest in poverty levels in the region and so on.

Filipino citizens don’t want corruption or authoritarianism, but having failed to get rid of these for centuries, can Filipinos still succeed in eradicating these menaces?

Who would disagree that corruption drains a country’s civil service systems, diminishes the value of projects meant for the people and causes injustices to civilians, companies and everyone? Who wants a dictator? What does the empirical and historical evidence show?

Why do some nationals and nationalities benefit from and prosper with authoritarianism, corruption, coercion and occupation while others suffer and even disappear? Some Filipinos use these same toxic practices as excuses for lagging behind in improving education and reducing poverty.

To answer, it would be good to examine the validity of these reasons regularly cited.
Authoritarian periods are arguably times of great economic progress for a number of countries in the world. In modern times, Germany reputedly grew fastest under Bismarck, who after consolidating the hundreds of German states and municipalities, imposed policies that earned him the name “Iron Chancellor.” Singapore reportedly grew fastest under Lee Kuan Yew, who started off as a dictator and led Singapore to a per capita of close to $65,000 today. South Korea, Japan and Taiwan allegedly progressed under authoritarian rule. Franklin Roosevelt steered America through the Great Depression and the Second World War, extending to 16 years.

Corruption, favoritism, monopolies or unfair competition have, to a certain degree, helped some groups in some countries build themselves into economic powerhouses. Germany supported favored companies in steel, cement and chemicals that became pillars of German industry. For a century, Germany was one of the most powerful economies in Europe. Following the German model, Japanese monopolistic zaibatsus (conglomerates) created similar international trading and manufacturing powerhouses that later developed into Sony, Toyota, Mitsui and Sumitomo. South Korea started with $80 per capita after the Korean War (over $31,000 per capita in 2019), developing chaebols (conglomerates), which grew into LG, Hyundai and Samsung that turned out consumer electronics and now giants in chip and technology. The development model of creating champions through anticompetitive practices of US “robber barons,” decentralized planning and industrializing the US economy by consolidating and streamlining railroads, steel plants, energy and finance, building foundations of US industrial dominance in the world. Edison Energy spread black propaganda to beat Tesla. The corruption of the Japanese, Korean, Indonesian, Vietnamese and many other business models did not stop them from becoming highly competitive.

Meanwhile, central planning and communism can also be successfully competitive. Granted that the collapse of the Soviet Union’s economy and the poverty experienced in earlier Vietnam, Laos, Cambodia and North Korea has convinced the US and many other countries that communism is a dead system; perhaps some forms of communism are clearly not viable. However, hybrid models of central socialist planning evolved with capitalist enterprise appear capable of unheard-of speeds of progress. Through the new communism, China progressed not only in building its economy, but also in managing health and reducing poverty ‒ debatably the biggest in world history. Even the World Bank estimates at least 800 million Chinese nationals in the last four decades have escaped it. The communist country has also become a science and technology leader. To attribute China’s achievements to cheating - while there may be cases of such as is true with the US and other countries ‒ is to ignore that many of the biggest US companies such as Apple, Walmart, General Motors chose to do business with China and grew wealthy in the process.

China maintains that technology is not a field where one can cheat its way through for sustained progress and insists that the most successful corporate model is centrally directed.

Even the US and other progressive countries pick and subsidize prioritized enterprises in agriculture, technology, health research and communications, and doing so makes sense.
Meanwhile, there are democracies that are repeatedly failing and languishing in poverty or debt, proving that the economic success of democracy or communism is circumstantial and, therefore, should not be force-fed to others.

Countries and citizens can work with and benefit even from parties with which they are in dispute; even those that have slighted or subjugated you. Japanese industrialists learned the best practices in Western manufacturing and the dichotomy of building economic empires or else have one’s economy empirically overtaken. The Land of the Rising Sun opened itself up not only to the “extoritions” of the US government’s Perry Expedition but also to Western technologies that allowed Japan to become a world power.

Conversely, China was crushed while attempting to resist yet falling under foreign coercion. Previously, its economy progressed greatly even under Mongol rule in the 1200s. After the devastation under Genghis Khan, China expanded massively into world trade with Marco Polo and into manufacturing with Kublai Khan, who revived and protected the Silk Road and promoted the use of paper currency. China was invaded again and fell under Manchurian rule in the Qing period. China became wealthy enough to entice eight world powers to try and divide it up despite massive corruption and coercive Western trade.

Under US coercion, the Philippine economy did well while under Spanish occupation, it did not. Today, former coercers and the formerly coerced engage in beneficial trade and invest in each other’s economy. The Philippines trades with the US, Spain and China while China continues to engage in commerce with Vietnam, South Korea, Japan and the West.

It is good to keep in mind that such partnerships were not always possible. There was no stopping the Western powers from decimating the populations of the Indians of North America and South America in order to take over the land permanently. Westerners also coerced, caused upheavals and stripped Southeast Asia and China of its treasures and markets.

Even Asian countries such as Japan have coerced to devastating effect neighboring countries, namely the Philippines, South Korea and Taiwan. Yet, Taiwan learned industry from the Japanese and became the manufacturing hub for the war effort of Japan. South Korea built beneficial industrial infrastructure under Japan but refuses to acknowledge this as a positive because of the attempt of the invading Japanese forces at the time of obscuring Korean culture and history by disallowing the use and teaching of its language.

How did the citizens of countries succeed economically even under coercion, subjugation and invasion? One answer is literal: by not getting killed, by picking their battles, by living to fight another day when advantage could be won, by not getting killed uselessly and by avoiding genocide as a whole. Another answer is practical: by working industriously, by having motivational resilience and by being productive even under duress for long periods and under unfair deprivations.

Perhaps the best answer is by learning and adapting all the time while retaining faith that opportunities will arise. These are what will make a nation eventually prosper and gain respect against all odds and over long periods.

While others give up because of difficulties, some nations and nationals such as the Koreans, Chinese, Vietnamese and Jews have been motivated by their centuries-old hardships that have taught them to adapt and change course whenever necessary. This shows the spiritual resilience and creativity of a given culture that, among other possible outcomes, eventually translates into a strong economy.

A popular Chinese proverb says, ““The best time to plant a tree is 20 years ago; the next best time is now.”

Join Webinar Sept 1 (Tuesday, 2 to 4pm) “Quo Vadis? US-China Hybrid Wars, Duterte, SCS-WPS, Fake News, Digital Revolution… How Pinoys can Benefit!”. Economist Prof Butch Valdes, HuaweiPH Karrie Buenafe; Geopolitical Analyst George Siy. (RSVP: idsicenter@gmail.com)


New Worlds by IDSI (Integrated Development Studies Institute) aims to present frameworks based on a balance of economic theory, historical realities, ground success in real business and communities and attempt for common good, culture and spirituality. We welcome logical feedback and possibly working together with compatible frameworks.

**Also published in: https://www.manilatimes.net/2020/08/30/opinion/columnists/corruption-authoritarianism-and-other-excuses/760982/

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