I don’t want to overly simplify what is really a very complex subject but in the interests of a discussion piece my basic thoughts are these. [*]
What really makes it interesting is how the two countries dealt with it. We in New Zealand chose an open door approach, which opened up the economy to market forces and drew in massive amounts of FDI (foreign direct investment) and restructured the way government departments operated to accommodate it. The outcome is there for all to see.
- First world.
- Although a small economy, but with low levels of unemployment.
- Generally good standards of education and health, which are as good if not better than most countries around the world.
- The country consistently appears in the top 20 best places in the world in almost any list of positive things you see.
Here, in the Philippines, they seem to have used the exact opposite tactic. They closed the doors, battened down the hatches and tried to ride it out by cost cutting, reducing expenses, and trying to export its talent to pay the bills rather than import FDI, new ideas, and innovation.
What caused these crisis’s, in my view? In the case of my country it was a decision to pay out subsidies to the farming and agricultural sector to try and get over the fuel crisis of the early 70’s that led to us running up massive debt and our getting into strife. The government of the day I guess felt that eventually it would sort itself out as we are a food basket and people need to eat and they pinned their hopes on eventually being able to pay down the debt. This crisis also led to some other poor decisions by the government of the day such as trying to go it alone in terms of building massive infrastructural projects which further added to the debt. The ideas were good but the timing was bad in my view. And although subsequently they were proven to be valuable, at the time they added to the problem.
As in all things, timing is everything.
Further study suggests similar poor decision making by Marcos and his supporters which also fueled massive debt, which as we all know is unsustainable and eventually what brought down his regime. The corruption in the Marcos days did not help either, with allegedly billions of dollars simply vanishing. But what followed of course just compounded the problems. Rather than open the doors of the country, and freeing up the economy, the people pushed into power by the EDSA1 revolution did the exact opposite and therein in my humble opinion is where the wheels well and truly fell off.
So sure Marcos and his decision making processes did not help. Yet the real killer was what happened subsequently.
Pretty much, the country suffered badly under Marcos, and of that there is little doubt. But when the time came to free themselves from his shackles the subsequent decision making was equally as poor. And in some ways, only worsened things when compared to the Marcos era. The decisions to do the opposite to what everyone else was doing, included using the excuse that it was foreign debt and the evil foreigners who funded Marcos as being the cause. Therefore their decision to block that from happening any more, was about as dumb as it gets.
One can argue this was a vastly different scenario in the Philippines because of it being preceded by 20+ years of dictatorship. And there is some truth in that, but there is also the argument that outcomes are more likely to be decided by how one reacts, as opposed to how one acts. If faced with a bad situation, one can be negatively closed minded and defensive, such as what happened with the Philippines. Or one can be positively open minded and aggressive and formulate new structures and ways of doing things as did Singapore, Australia, and New Zealand have, to name a few.
I will let you be the judge of which delivers the best outcomes.
[*] Originally posted as a series of comments in Facebook, by: Trevor Bailey