A developing country?

The past has consequences for the present, so as I gape at what the United States of America (USA) and the People’s Republic of China (PRC) are doing to each other, I can only hope that the Philippines will not be caught in the crossfire. Take a look at a globe, not a flat map, to see how the God-given location of our archipelago is central to the zone of conflict, so much more than Indonesia, New Zealand, and Australia.

As the USA confronts the PRC, “economic nationalism” has become the battle cry of President Donald Trump and his national security adviser, Steven Bannon. I was amazed to hear that repeatedly on You Tube. To think that the phrase “economic nationalism” has fallen into disuse, it has become downright archaic since the advent of the GATT and WTO. Yet, thanks to POTUS (president of the United States), it has recently acquired a strong contemporary resonance. I have watched POTUS spew what used to be an arcane phrase — economic nationalism — with fire in his eyes, baring fangs and claws. How weird to hear that from an American president in the 21st century.

Many of us have heard that phrase before. It was the battle cry of our political leaders like Senators Claro M. Recto, Lorenzo Tañada, and Jose Diokno, eminent economists like Alejandro Lichauco, Manuel Yap, Walden Bello, historians like Hernando Abaya, post-war entrepreneurs that included Salvador and Vicente Araneta, journalists like I. P. Soliongco, Teodoro Locsin, Sr., Carmen G. Nakpil. No other president except Carlos Garcia has audaciously advocated a “Filipino First” policy.

I have lived long enough to remember that in those days, it was inconvenient to expound on “economic nationalism.” One could be accused of being subversive, a communist, a purveyor of that totalitarian, godless ideology, a secret agent of the USSR. During the first Cold War, China was not the enemy, it was a mere side show as it wielded no economic or military clout.

Economic nationalism was taboo because the Philippines’ designated role in the international division of labor was that of a supplier of raw materials and a market for the products made out of those raw materials it exported to industrialized countries, mainly the USA. The 1930 Dodd’s report affirmed that industrialization was not for us. Yet, Filipino entrepreneurs persisted in fabricating goods — from hair pins to office equipment, agricultural tools, furniture, toys, etc. —  all for domestic consumption — but sooner than later, those fledgling industries were smothered by unequal treaties and a flood of cheaper imported products.

“Domestic market” was another concept that provoked suspicion. To nourish it and promote its growth meant to address the disparity of wealth and to strengthen the purchasing power of the marginalized sectors — that implied social justice. As a development objective, it was deemed detrimental to free trade, to market forces. To my surprise, it is a current mantra of the USA in its confrontation with the China. POTUS declared that all American companies installed in China are subsidizing a totalitarian form of government, so they should immediately pull out and return to the USA to revive the domestic market. America first! (President Carlos Garcia, wherever he is, must be having the last laugh!)

I am amazed that all those American companies were allowed, if not encouraged, to invest in China without demanding regime change. There were no attempts to remove Deng Xiaoping; nor are there plots to overthrow his successor, President Xi Jinping. Neither were threatened with Bay of Pigs type of covert operations like Cuba was in the late 1950’s and more recently, Venezuela. No economic embargoes have been imposed on China nor its trading partners. Obviously, the bottom line of savage capitalism is not regime change but access to cheap labor that redound to inflated profit margins.

So, President Trump and his cronies have come to the conclusion that the PRC is no longer a Third Word country. I think that is obvious. But, when the USA and China disengage and decouple, will the USA be demoted to a developing country? That remains to be seen.