GLOBAL BALITA

by Manuel F. Almario
Spokesman, Movement for Truth in History

In his article, How did we get to where we are?, published by the Philippine Daily Inquirer on Sept. 12, 2009, Dr. Bernardo M. Villegas of the University of Asia and the Pacific blamed our nation’s economic failure on the adoption “for 30 long years after World War II” of “inward-looking, import substitution industrialization based on protectionist, anti-market and ultra-nationalist ideologies.” This is a distortion of our history.

In fact, this policy was in force only for 11 years from 1949 to 1960. The policy, featured by import and exchange controls, was first instituted by President Quirino in 1949 following a severe financial crisis that hit our country. It was continued through the decade of the 50’s by Presidents Ramon Magsaysay and Carlos Garcia. Garcia added the policy of “Filipino-first” whereby Filipino entrepreneurs were given priority in the allocation of foreign exchange to finance imports.

It was during this period — the 50’s decade — that the Philippines rose second only to Japan in level of economic development and industrialization.

James M. Putzel, a PhD from the University of Oxford, wrote in his book, Captive Land (1992), that the “imposition of import and exchange controls in the late 1940s had a significant impact on the economy [of the Philippines]. In the first four years, from 1949 to 1953, 5,000 industries sprouted. The industrial sector’s contribution to GNP rose from 8 percent in 1949 to 17 percent in 1960. Industry grew by 12 per cent per annum between 1950 and 1957.”

The rise of employment opportunities also caused the real wages of workers to go up. They started to fall and has not recovered since President Macapagal (father of Gloria) upon becoming president in 1961 scrapped the exchange and import control policies, as well as Garcia’s Filipino-first policy.

“During Macapagal’s term, the US pushed a policy of ‘liberalization’ and ‘free enterprise’ where foreign investment and export-oriented production were to generate growth,” wrote Putzel, who was a visiting lecturer at the University of the Philippines from 1988-89. He was also associated with the Center for Developing Area Studies of McGill University, Montreal.

These policies were the same ones pursued by the Marcos, Aquino, Ramos, Estrada and Arroyo administrations up to the present, a period of 48 years (1961-2009). It was during this period that our country fell to the bottom of the heap in Southeast Asia. The huge loss of jobs caused by the shutting down of our factories after the abandonment of import substitution in favor of export orientation and liberalization caused the mass exodus of our increasingly surplus labor resulting in acute social problems and a costly brain drain at home.

Villegas had it upside down, using his theory to cloak reality. His distortion of history misleads our people, causing much suffering and undermining our future.

(From Letter to the Editor, published by PDI, Oct. 13, 2009.)