The COVID-19 pandemic highlights the folly in how entire generations had been indoctrinated in the concepts of hooking up to the bigger global market rather than maintaining local self-sufficiency. Even the United States with its decades-long wanton “outsourcing” binge ultimately shot itself in the foot. It created manufacturing powerhouses like China that are now racking up surplus upon surplus while globo-“sourcer”, the US, sinks further into deficit oblivion.
Just how fragile these inter-dependencies among nations had become now comes to light as entire supply chains grind to a halt while international travel plummets. Countries are now forced to become more self-sufficient, finally recognising the network of economic and social insecurity globalisation created. In the best position to survive and crawl out of this deep hole — even thrive — are societies with strong scientific, technological, and industrial traditions. These are nations that are net capital exporters. At risk of catastrophic collapse are net capital importers — countries dependent on imports for even the most basic durable products such as can openers. These societies are woefully dependent on foreign expertise and, yes, dependent on foreign investment to even just survive.
The Philippines, a Third World country then as it is now, remains one such country encouraged to “open its markets”. But open up the market to foreign capital and foreign goods in a society that inherently lacks a track record of innovation and suffers a deficit of entrepreneurial inclination to begin with, and you get an addiction to all things foreign (foreign capital, foreign incomes, foreign substance) and a vision for developing an indigenous capability to create these things atrophied beyond all hope of recovery. Not all societies are created equal just as not all people are destined to be wealthy.
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Whatever the case and whatever the excuses of the past, the COVID-19 pandemic and the unprecedented economic crisis it is creating brings back home a clear message. Third World countries like the Philippines need to work at becoming truly independent. Specifically, the Philippines needs to learn to sustain its population primarily through domestic production and investment. Can’t do that they say? Well that just means there are too many Filipinos than can be sustained by their domestic product. Tough luck, right?
Indeed, the enormous population of the Philippines itself is a product of foreign capital. It is sustained by imported food, imported medical technology, and imported incomes. It is sustained by money merely passing through the country and not money generated by wealth created within its shores through productivity gains brought about by innovation and its conversion into capital that is employed in producing things domestically.
Ordinary people being led to believe that they are entitled to own unnecessary stuff and consume excessively has long been a problematic status quo. Corporations have all but convinced people that they can have things right here and right now. There is something not right about societies that believe in that philosophy. Self-importance seems to be a human condition that shrewd marketing had so effectively exploited. There is of course a price to pay for getting things fast and cheap. We are seeing the effects of our fast and cheap way of life today now that COVID-19 has come around to tell us the party is over.
Unless a vaccine for COVID-19 is discovered, entire economies will have to operate in relative isolation over the foreseeable future. The Philippines is no exception and it will need to find a way to take care of its own in a world of dwindling foreign “help”. Perhaps it can survive on producing more nurses for export as rich countries beef up their healthcare infrastructure and drive demand for such professionals. But that’s just the same poverty trap that will keep the Philippines stuck in an insecure state of dependency and a chronic lack of a solid industrial and capital foundation to build a truly independent and resilient economy.
benign0 is the Webmaster of GetRealPhilippines.com.