Sunday, January 17, 2021

WHY LEFTISTS REJECT FOREIGN INVESTORS

 WHY LEFTISTS REJECT FOREIGN INVESTORS

 

Before I answer the question, let me first define what I mean by “leftists.” I refer to the advocates of nationalist democracy (NatDem) and socialist democracy (SocDem), who knowingly or unknowingly, may have been influenced by teachings of the communist movement, specifically the Communist International (Comintern) of 1919-1943.[i]

 

The Comintern was an international organization that advocated world communism.[ii] It was determined to "struggle by all available means, including armed force, for the overthrow of the international bourgeoisie and the creation of an international Soviet (i.e. council) republic as a transition stage to the complete abolition of the state."[iii] Comintern “accepted the revolutionary potential of nationalism in the colonial world.”[iv]

 

Notably, the communist ideology was rooted in Marxism and similar schools of thought, that concerned itself only with the poor worker class, the rich capitalist class, the conflict between the social classes, the inevitable social revolution, and the goal of common ownership of the means of production.[v] In other words, it was NOT concerned with nationalities, ethnicity or race.

 

Nonetheless, in order for the ideology to penetrate the colonial world (then ruled by the capitalist powers of Western Europe and North America), the Comintern adopted the strategy of agitating the colonized to rise up against the colonizer under the banner of “nationalism.”

 

Thus, their adherents were indoctrinated about the “evils” of foreign owned businesses (which were mostly from the Western capitalist powers), and thereafter sent on global missions to uproot and destroy them. Once the Western colonizers were weakened if not defeated, the pure communist ideologues can come in to establish a new world order.

 

Looking back at my law school days, where I joined a SocDem group called Sandata, that was affiliated with a larger coalition called Bandila, I guess I was among those indoctrinated with ideas of “nationalism” that was basically anti-foreign. In fact, in our course on constitutional law, we were made to believe that limitations and restrictions on foreign investors under the Filipino First policy, was “nationalist” and therefore patriotic.

 

Today, the communist movement for global hegemony has dissipated, but its anti-foreign doctrine lingers on among “leftists” of different shades. I guess they have forgotten, or maybe they never got to know, that the anti-foreign doctrine was merely a strategy to penetrate the colonial world for the eventual entry communism.

 

I for one no longer believe that foreign investors are almost always predators, who are simply out to exploit the country and its people. Rather, I see them as simply businessmen, like any other, who are willing to invest capital and buckle down to work, in exchange for reasonable profits.

 

If we take a survey of workers or employees in the country now, I guess many if not most of them, will prefer to work for a multinational company (owned by foreign investors), instead of a purely local company (without any international exposure). This is because from what I have seen, multinational companies generally offer higher salaries and benefits.

 

Just to be clear on this point, this is not because these foreign investors are benevolent. It is simply because their foreign owners and management are used to much higher salaries and benefits in their home country. On the other hand, if we look at the local investors who are used to hardship, I guess it follows why they are also hard about salaries and benefits.

 

As I look now at the Filipino First policy, that by law restricts or limits the entry of foreign investors into the country (thereby creating a captive local market), I see that it makes the fundamentally wrong assumption that the profits earned by Filipino businessmen, will “trickle down” to the Filipino workers and consumers.

 

On the contrary, economic experience shows that enterprise owners on one hand, have contradictory interests in relation to enterprise employees and customers on the other hand.  See Theory of the Firm: Managerial behavior, agency costs and ownership structure, by Jensen and Meckling (1976). https://www.sciencedirect.com/science/article/pii/0304405X7690026X. Law of Supply and Demand, by Chappelow (2019). https://www.investopedia.com/terms/l/law-of-supply-demand.asp.

 

The enterprise owners will simply flow as much profits to themselves, unless or until the enterprise employees and customers push back, whenever they can. The same motivation for profit of course applies, regardless of the foreign or local ownership of the enterprise.

 

Today, the biggest dollar earners of the country are the OFWs (overseas Filipino workers) who work for foreign employers overseas, and the BPOs (business process outsourcing) that are generally owned by foreign investors.

 

Ironically, industries dominated by enterprises majority or wholly owned by Filipino businessmen, have the worst performance. We have the highest power cost (i.e. power distribution), slowest internet (i.e. telecommunication), expensive transport costs (i.e. mass transportation), unpredictable water supply (i.e. water distribution), highly politicized mass media, and largely untapped mineral and energy resources.

 

As I see it now, the Filipino First policy is nothing but a Businessmen First policy, where the Filipino workers and consumers are last priority. They will need to get jobs overseas if they want better pay. Otherwise, they will have to swallow the high domestic consumer prices, because there’s no other choice locally.

 

Notably, some associations of big businessmen join hands with the indoctrinated “leftists” to block the entry of foreign investors that they fear will challenge their monopoly or oligopoly of the local market. I guess their motivation is obvious, and there’s no need to write another article about it. They simply seek to perpetuate their stranglehold of the local market, legalized by no less than the constitution and the laws, and maintain their artificially high market prices, without having to worry about new players that will force them to compete like hell.

 

 

Atty. Dindo B. Donato, General Counsel

Tanggulang Demokrasya (Tan Dem), Inc.

16 July 2020. Makati City, Philippines.

 

Disclaimer: The views and opinions expressed in this material are those of the author

and do not necessarily reflect the official policy or position of TanDem.

 

 



[i] https://en.wikipedia.org/wiki/Communist_International.

[ii] Id.

[iii] Id.

[iv] Id.

[v] https://en.wikipedia.org/wiki/Communism.

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