Wake Up, Philippines!

From greed to green

Posted in Business, Energy, Environment, Finance, Global Financial Crisis, Greed by Erineus on February 11, 2009

If there is a silver lining to the increasingly ominous specter of a global financial meltdown and the far-reaching implications of Great Depression-like scenarios, it should be the opportunity to move from “greed economics” toward a global green economy. Global capitalism as we know it has imploded with the collapse of Lehman Brothers, Bear Sterns, Merrill Lynch and such other giant investment and insurance houses, and the future is frighteningly uncertain.

But if out of this mess the global economy is more decidedly weaned from the financial world’s propensity to “make money from the movement of money” (what, pray tell, do “derivative contracts” and other exotic futures instruments mean to the average citizen?) and shift it to the creation of new, real value — new technologies, innovative materials and industrial products that sustainably meet energy needs and address eco-efficiencies — then there is hope for economic renewal, and, indeed, a real chance to curb global warming. Jacques Attali, founding president of the European Bank for Reconstruction and Development, would call it a “Global New Deal.”

Countries with powerful reserves — China, Russia and other oil-producing countries — could well finance “greener” infrastructure projects, especially in sustainable and renewable energy, in the developing world to be built among others, by leading American companies. This would ignite broad growth in the “real economy” of actual production and human invention, argues Attali, who recently wrote the trenchant book “A Brief History of the Future.”

It is time leaders took the Herculean challenge of restoring balance in the larger economy and the underlying factors of ecology with the “urgency of now.” The $700-billion bailout of Wall Street is touted by the Bush government as “pivotal for Main Street jobs and homes.” But as several scientists would propound, such a bailout sum — or a fraction of it — will go a long way in “bailing out nature.”

Just think what wonders a hundred billion dollars can do to repair damaged ecosystems, restore biodiversity loss, curb pollution, support technological innovations and renewable energy use, and put in place mitigation measures for climate change — especially in the vulnerable regions of the developing world. Such environmental threats to human health, food security and continued access to clean water, after all, are inextricably tied to poverty indices and the incapacity of millions around the world to meet basic needs and attain higher standards of living.

The contradictions of global capitalism have led to the crisis of overproduction, or as social scientists would have it, “overaccumulation” and “overcapacity” — the buildup of “tremendous productive capacity that outruns a population’s capacity to consume,” given widespread poverty and inequalities around the world that limit purchasing power and reduce overall profitability. Moreover, the financial economy of unbridled speculation or “squeezing value out of already created value,” as sociologist Walden Bello would describe it succinctly [Read Bello’s column], has only exacerbated volatilities in the world economy, such as crippling oil and food price crises; and have ultimately added to the ruin of the earth’s vital life-support systems of fresh water, clean air, the seas, forests and land.

In the wake of the largest financial collapse since 1929, this crisis should perforce move economic planning and activity toward what environmental/eco-efficiency advocates Dan Esty and Andrew Winston refer to in their book “Green to Gold”: the locating of sustainability and new green technologies at the center of business strategy and government policy. The future of humanity surely depends no less on how society embarks on a sustainable track with regard to both energy needs and environmental requirements.

This requires nothing short of folding environmental stewardship into corporate culture and the running of businesses. This likewise calls for increased and more effective global governance mechanisms and, yes, supranational responses. By necessity, governments and civil society actors will have to take larger roles, and what may have been a heretofore near-absolute faith in the self-correcting nature of free markets will require serious revisiting.

These interventions will have to come in various forms — whether in terms of clear country and regional targets for the United Nations Millennium Development Goals or the accountability and commitments of nation-states and governments in global stewardship instruments like the Kyoto Protocol, among others. The world’s economies and the world’s six billion inhabitants deserve no less.

Only then will new social contracts emerge, or a Global New Deal forged, with greed economics supplanted by a global green economy that drives long-term growth … and heals a battered planet.

Neric Acosta was Liberal Party congressman of Bukidnon province from 1998 to 2007 and principal author of the Clean Air Act and Clean Water Act; he is now a professor at the Asian Institute of Management.

By Neric Acosta
Philippine Daily Inquirer
First Posted 02:39:00 10/04/2008

Credit Culture

Posted in Banking, Business, Finance, Global Financial Crisis by Erineus on February 11, 2009

MANILA, Philippines—The crisis that has pushed the American financial system to the brink of disaster is spawning its own moral economy. The new object of fixation is blame-worthiness, rather than credit-worthiness.

The high-flying executives on Wall Street who invented those ingenious financial instruments known as “derivatives” are being singled out for special flogging. Not too long ago, they were the celebrated and highly compensated geniuses of the US economy. Today, there is not a corner in hell that seems punitive enough for them, no penalty that can conceivably equal the magnitude of their greed and recklessness.

But this blame game is ultimately a futile exercise. It’s like blaming culture for the way people are. It may be morally gratifying, and perhaps even politically unavoidable. But it brings Americans no closer to understanding the complexity of their highly-leveraged economy. Credit is not just the lifeblood of the US economy; it is its heart and soul. It is the only way Americans do business. In such an economy, one’s credit record is all that is needed to open doors. It is the center of gravity of one’s identity in the larger society.

A foreigner visiting the United States for the first time will not fail to note the centrality of credit in everyday transactions. Hardly anyone pays with cash, except for the smallest purchases. If someone forks out a hundred dollar bill to pay for a cup of coffee, as Filipino tourists are sometimes wont to do, the cashier will likely take a second look at him and at his money. In this economy, the use of a credit card or even a check to pay for a meal at McDonald’s is the most normal thing in the world.

In hierarchical Philippine society, we measure a person’s worth by his family background, his educational attainment, his profession, his connections, and his visible wealth. In less hierarchical America, a person’s worth is roughly equivalent to what he can borrow from a bank, or how much he can buy on credit. It is one’s credit standing that matters; it is the measure of almost everything else that is regarded as valuable. It attests to a person’s capacity to pay back, which is all that is important. If one habitually pays with cash, there is no way he can build a credit history, the most important basis of economic identity, and one’s principal claim to citizenship in the market.

Credit cards and housing loans are the two most important indices of the average American’s economic standing. It is fairly easy to get a credit card, but also quite easy to lose it if you do not meet the minimum monthly payments. But housing loans used to be different — a steady and adequate income was required to access them. It wasn’t until the early 1990s that the dream of owning a house became possible for almost every American family, notably for those whose incomes did not normally qualify them for such loans. Thus were subprime mortgages born. They were hailed as democratic, rather than devious; equitable rather than exploitative.

It was the time of the economic bubble. Banks and other financial institutions were awash with money that needed to make more money. And so they started giving out loans with little regard for the risks of not being paid back. They were focused on interest payments. Borrowers who were enticed with initially low interest payments found themselves trapped in schemes that carried adjustable interest rates and high penalties for pre-payment. But the spiraling housing demand drove prices through the roof and gave homeowners the assurance that what they were paying out was more than offset by the rising market value of their homes.

It is an aspect of the inventiveness of finance capitalism that when the subprime housing mortgages began to turn sour, the investment houses, instead of being alarmed, bundled these mortgages with credit card debts and sold them as mortgaged-back securities. There was a time when responsible borrowers, still the majority, were seduced with offers to re-finance their mortgages. This meant borrowing more money against the equity they already paid, money they could use to upgrade to a bigger home, or to buy a new car or go on an expensive holiday. These were offers that were too good to ignore, and they were perfectly consistent with the entire logic of the American way of life.

I remember how my US-based sisters and their husbands carefully calculated the benefits of having money to invest in the Philippines against the risks of refinancing under new adjustable repayment terms. They were not alone. Many Filipinos took the money and bought properties in the Philippines, instead of moving into a bigger home or buying an additional car. But many others were not as conservative. The more access they had to borrowed money, the freer their spending habits became. Surely, they must accept some blame, and they are paying for it. But it’s not entirely their fault. They are after all only a small part of a system that has created a reality so complex that it spins one contingent state after another, rendering its self-stabilizing operations totally useless. It is an amazing time.

One good thing that I see in all this for us in the Philippines is that it will finally put a stop, hopefully permanently, to local banks’ annoying practice of issuing unsolicited credit cards in order to spur credit spending. A consumerist culture driven by credit is the last thing we need in these times.

* * *

Comments to public.lives@gmail.com

By Randy David
Philippine Daily Inquirer
First Posted 02:35:00 10/04/2008

Financial crisis timeline

Posted in Banking, Business, Finance, Global Financial Crisis by Erineus on February 11, 2009

PARIS—Key developments on Friday in the world credit crisis:

• Markets wait on news of a new vote in the US Congress, where Representatives are to consider a new version of a $700-billion (Є500-billion) bailout plan.

• The European Central Bank renews loans of $50 billion (Є36 billion) to commercial banks in what has become a regular effort to keep cash flowing on distressed interbank money markets.

• Trading on Russia’s main stock market is suspended after stocks plunge ahead of the vital vote by US lawmakers.

• European stocks edge higher, despite steep losses in Asia where Tokyo matched Wall Street by striking a three-year low.

• Switzerland’s biggest bank UBS says it will cut 2,000 more jobs as it repositions its investment bank which had been blamed for massive asset write-downs after the US subprime crisis.

• The Bank of Japan says it injected a further ¥800 billion ($7.6 billion) into the financial system as it tries to keep cash flowing.

• The chief executive of troubled Franco-Belgian bank Dexia says he will forgo a “golden parachute” payoff after resigning following a government bailout.

• The US bank Wells Fargo agrees to buy its distressed rival Wachovia for $15.1 billion in stock, ending a deal between Wachovia and Citigroup.

• Britain increases its government guarantee for bank deposits, following a similar move by Ireland.

• The leaders of France, Germany, Italy and Britain prepare to discuss the crisis at a mini-summit on Saturday despite disagreements that killed off talk of a Europe-wide bail-out package.

Agence France-Presse
First Posted 22:18:00 10/03/2008

Public to pay for BNPP revival—solons

Posted in DOE, Energy, Social Issues/Concerns by Erineus on February 11, 2009

MANILA, Philippines – The public will partly shoulder the cost of reviving the mothballed Bataan Nuclear Power Plant (BNPP) that is being pushed at the House of Representatives as an alternative and cheaper source of energy for the country.

House Bill 4631 or the “Bataan Nuclear Power Plant Commissioning Act of 2008″, authored by Representative Mark Cojuangco, intends to raise as much as $1 billion, to be sourced from the 10-centavo per kilowatt hour surcharge of the total electric power generated and which would be collected from consumers and international or domestic loans.

On Tuesday’s hearing at the House of Representatives, members of the committee on appropriation engaged anew in debates on the funding for the plant’s rehabilitation, decommissioning, and commercial operation.

Albay Representative Edcel Lagman questioned why funds should be sourced from the General Appropriations Act, or the annual budget, to be able to operate the plant again.

Cojuangco agreed to delete that contentious portion, but maintained that Section 22 of the bill, which provides the 10 centavos surcharge and the loans, should stay.

“Section 22 is still unacceptable because of the surcharge and the international and domestic loan agreements. The surcharge will be levied to consumers even before the plant starts running. … We heard from the Department of Finance that the government is still financing for the principal and interest of the BNPP . . . it’s not even fully paid for. . . . So it would be like throwing good money after bad,” Akbayan partylist Representative Risa Hontiveros told the committee.

Bayan Muna Representative Teodoro Casiño said removing the section of the source of the funding would be “deceptive and misleading” since it would still be the government that would impose the 10-centavo surcharge.

And when government borrows, Casiño said that payments would be made through automatic appropriations, which would, in effect, mean getting the money from the annual budget.

Cojuangco countered that having the plant as a source of energy would save the public P2 per kilowatt hour. And shelling out a measly 10 centavos per kilowatt hour would make the consumers owners of the plant.

With the P2 per kilowatt hour savings, the consumers will save at least P9 billion annually, Cojuangco added.

The committee will hold another hearing to vote on the “appropriation language” of the bill, but Hontiveros vowed to block it, saying the revival of the plant will need further study.

Pope against nuke for power

Posted in DOE, Energy, Graft and Corruption, Social Issues/Concerns by Erineus on February 11, 2009

MANILA, Philippines—It appears the pope and another ranking Vatican official were misquoted on the use of nuclear energy by a local politician.

Pope Benedict XVI supports the use of nuclear energy but only for improving the medical field and helping the poor but not for generating electricity, Balanga Bishop Socrates Villegas said Tuesday.

In an e-mail to the Philippine Daily Inquirer, Villegas refuted Pangasinan Rep. Mark Cojuangco’s claim the Pope and Renato Cardinal Martino, president of the Pontifical Council for Justice and Peace, supported the use of nuclear energy to produce electricity.

“This is not about nuclear power for electricity generation but nuclear science to promote medicine and help the poor and the sick,” Villegas said.

The bishop highlighted the part of the Pope’s statement made in July 2007 where he said “to support the use of peaceful and safe nuclear technology for authentic development, respecting the environment and ever mindful of the most disadvantaged populations, is always more present and urgent.”

“The statement is not about nuclear power plants but nuclear science for the benefit of medicine. The perennial question about storage and disposal of nuclear waste is still unresolved and poses a threat to the environment which the Pope warns about,” Villegas said.

Vatican statements

Cojuangco is campaigning to have the mothballed Bataan Nuclear Power Plant opened and has a bill pending in Congress to do just that.

Villegas, Lingayen-Dagupan Archbishop Oscar Cruz and Manila Auxiliary Bishop Broderick Pabillo have condemned the plan.

On Monday, Cojuangco visited the Inquirer offices and, quoting Pope Benedict on the 50th anniversary of the International Atomic Energy Agency in July 2007, said the Vatican fully approved and supported the IAEA’s mandate “to accelerate and enlarge the contribution of atomic energy to peace, health and prosperity throughout the world.”

The lawmaker also quoted from Cardinal Martino’s statement which followed the Pope’s message: “Nuclear power could be part of a balanced energy mix alongside forms of clean energy. With maximum safety requirements in place for people and the environment and with a ban in place on the hostile use of nuclear energy, why should the peaceful use of nuclear technology be barred?”

Using the statements from the Vatican, Cojuangco said he was able to convince Cruz (but not Villegas as earlier reported) to be open to the possibility of having the BNPP put into operation.

Villegas said Cardinal Martino’s statement was made in the context of the situation in Italy and not in the Philippines.

“The commendation of nuclear power was based on two premises: First, that maximum safety requirements are in place and, second, that the ban on the hostile use of nuclear energy be in place. Is the first premise present in the Bataan nuclear power plant? Geologists and nuclear experts say otherwise,” Villegas said.

“This comment was made in the context of Italy. The Philippine geological context is certainly very different. The corruption situation in the Philippines is so bad that corrupt politicians are very likely to make money again from the rehabilitation,” he said.

By Philip Tubeza
Philippine Daily Inquirer
First Posted 06:03:00 02/11/2009

Shift to CFLs, avert 2nd BNPP disaster

Posted in DOE, Energy, Environment, Social Issues/Concerns by Erineus on February 11, 2009

Recent environmental disasters around the world have only succeeded in driving home the urgency of addressing climate change and global warming — and the food security problem in their wake. Note the rampaging floods in Australia’s northeast and the killer bush fires in the south, the severe drought in central China and the snowstorms that recently battered the United Kingdom. These natural calamities are being blamed on climate change.

In an interview we taped for radio dzRH this Sunday at 8 p.m., Presidential Adviser on Global Warming and Climate Change Heherson Alvarez stressed that increasingly severe natural disasters and the see-sawing of oil prices make it more imperative than ever to develop clean, renewable energy sources. But he also pointed out a most encouraging development: the successful founding conference and first session of the preparatory commission of the International Renewable Energy Agency (IRENA) in Bonn, with the Philippines as one of the signatories.

After four years of global negotiations led by Germany, world leaders finally agreed to create this new international agency to push the development and use of renewable, climate and resource-friendly technologies throughout the world, such as wind, solar, hydropower and biomass energy. IRENA will act as a reliable advisor and partner for its members, networking closely with them, in the realization that, to quote Germany’s Federal Minister for Foreign Affairs Frank-Walter Steinmeier, “only with global structures can the world achieve secure and sustainable energy supply.”

* * *

Alvarez says Germany comes with good credentials to lead these efforts, and the Philippines, which is now being tempted to flirt not only with nuclear energy as a concept but with operating the defect-riddled “Monster of Morong,” could learn a lot from it. He notes that Germany is the world’s biggest user of wind energy, with 18,000 installed wind turbines contributing 6 percent to its total electric power.

Germany also accounts for 39 percent of the world’s total power from wind energy. It’s surpassing even the US in terms of producing power from renewable sources and is fast closing in on Japan as a leader in the use of solar power as well. Together, wind and solar energy provide more than 10 percent of Germany’s electricity and this is expected to double by 2020.

What’s good for developing countries like the Philippines to remember is that, as presidential candidates Barack Obama and John McCain repeatedly stressed in their campaign, there are plentiful jobs in these new energy forms. In Germany 60,000 people are employed in the design and manufacture of equipment for wind and solar energy.

* * *

Alvarez joined the delegation led by Energy Secretary Angelo Reyes, armed with Republic Act 9513, the Renewable Energy Act, signed last month by President Gloria Macapagal-Arroyo and said to be the most comprehensive renewable energy law in Southeast Asia. It aims to accelerate the exploration and development of renewable energy sources.

Right now, there’s the Bangui Bay Project in Ilocos Sur province, the first commercial capacity wind farm not just in the Philippines but in Southeast Asia, with a 33 megawatt-capacity equivalent to the reduction of 62,951 tons of greenhouse emission gases per year. Moreover, the Philippine delegation carried President Arroyo’s support for an 80-percent reduction of global greenhouse gas emissions by 2050, first expounded by Alvarez at the UN Climate Change Conference in Poznan last December.

* * *

For the Philippines, the founding of IRENA is timely. As Alvarez puts it, “Hopefully it would draw us away from the temptation of using ‘Star Trek’-like technologies’ like nuclear power, and develop instead alternative energy sources of which we have a lot.” Speaking of the Bataan Nuclear Power Plant (BNPP), which a group of House members wants to operate without considering its state of unfitness, Alvarez opines that if the nation were to shift to CFL bulbs for light, which is a $31-million project now being implemented by the Department of Energy through a loan from the Asian Development Bank, about 500 megawatts of electricity would be saved each year, which is nearly equal to the BNPP’s capacity, but without the problems of site dangers, expensive fuel, waste disposal, decommissioning, etc. I suggest that Alvarez begin his campaign for renewable energy in homes, schools, offices, civic clubs and the media with the punch-line: “A shift to CFLs helps avert BNPP’s second disaster. “

* * *

Last Tuesday, I wrote about the Cebu-based Women’s International League for Peace & Freedom (WIL) which has undertaken the “aesthetic enhancement” of the Cebu City landscape. Their major project is to clean up and restore Colon Street, the country’s oldest street, founded by Miguel Lopez de Legazpi in 1565. Networking with the old families in Colon, WIL put up 52 historical markers that are now part of its “Heritage Walking Tour,” at a cost of P15,000 per marker with lamppost.

An example is the marker in front of Mariano Albao Cuenco’s residence, Imprenta Rosario, which details how he founded the Cuenco newspaper dynasty with his “Ang Camatuoran” (The Truth). With Mariano’s early death in 1909, his widow, Doña Remedios Diosomito Cuenco, took over the family printing press on the ground floor of their Sanciangco Street residence and reared children who became publishers in their own right: the future Archbishop Jose Ma. Cuenco, the future Sen. Mariano Jesus Cuenco and Rep. Miguel Cuenco. From this clan also sprang Cebu City Rep. Antonio Cuenco.

Intramuros could also use similar markers memorializing the lives and achievements of many illustrious families who resided in the Walled City, never mind if World War II destroyed virtually all their homes.

Philippine Daily Inquirer
First Posted 00:51:00 02/12/2009

Inhaling flattery

Posted in Books, DECS, Education by Erineus on February 11, 2009

“A little flattery hurts no one,” Adlai Stevenson often said. But he’d tack on a caution: “Don’t inhale.”

Did anybody inhale after Education Secretary Jesli Lapus ladled out a left-handed compliment for those battling error-studded textbooks?

Lapus complimented former academic supervisor Antonio Calipjo Go for waging an uphill campaign against flawed books, the Philippine Daily Inquirer reported. [Read story] But did Lapus have a choice? His department ordered schools to ban defective books that Go had pinpointed. Reluctant publishers trotted out correction pamphlets, but these are often ignored.

“Some people pay a compliment as if they expected a receipt.” And Lapus’ receipt? Why didn’t Go sit down with publishers? he suggested. After all his critique, “Burn after reading,” included “lines of ungrammatical poetry taken out of context”?

Go’s new review, “Lengua estopido,” however, ferreted out additional mistakes in both grammar and fact in the “English for You and Me” language textbook for Grade 6.

“Heidi’s family went on a vacation to the province of Paoay,” the book says. Paoay is an Ilocos Norte town, not a province. The country’s best-known “earthquake baroque church” is located there. Construction of St. Agustine started in 1694. The church, completed in 1710, is included on UNESCO’s World Heritage List.

“The Tausugs, who live in Jolo, are described as warlike people but most are friendly, peaceful and hospitable,” the book claims. “They are completely attired only when they sport weapons around their waists. They believe in black magic, sorcery, voodoo and love potions. The Koran, their Bible, forbids the eating of dead meat.”

Go’s previous review nailed samples of splintered grammar. “Make some magic for me!” the book reads. “‘Abracadabra, Sssh! Boom!’ Bobby shouted. He ran to his uncle. ‘Looked here, Uncle,’ he said. His uncle looked like an invisible man.”

There are one-liners that double up the reader: “The engine of the tractor is sleeping.” “Turtles squirm independently.” “A ferryman worked hard as transport chief of the rafts.”

The new critique turns up more of the same: “Many can be learned from reading books.” “He resembles the knight in a shining armor.” “Under the bed lay the robbers, as quiet as a mice.” “A smile is something that you give it away.”

But what about “ungrammatical poetry taken out of context” that had Lapus all steamed up?

“Love one another and let them express / For life is short and leads to an end / So feel the touch and moving caress / And may God be the divine witness.” “She lives in a place that is drowned in mystery.”

Wait, there’s more: “I got a butterfly with flower-designed wings.” “He lifted his soul because of loneliness.” “The grass seems to wink at me.” “Even the birds laughed at him!”

“I am aghast at the education secretary’s defense of errors in ‘English For You and Me’ as poetry,” e-mailed Dr. Jaime Ong of De La Salle University. Ong, who has a PhD from Stanford, adds: “Good heavens, I teach poetry — Shakespeare, in fact — and ‘the engine of the tractor is sleeping’ is not poetry, or verse. It’s a strained and graceless metaphor… I, therefore, welcome [Viewpoint’s] support for Antonio Calipjo Go.”

From Dammam, capital of Saudi Arabia’s eastern province, Fred Roda e-mailed. Here’s a quick translation of his message in classic Tagalog:

“I read, on Inquirer’s net page, your column, ‘Nitpicker? Or gadfly?’ I followed news accounts of Go and his advocacy regarding textbook anomalies. Errors in grammar and facts, plain misinformation at ano pang ek-ek in these textbooks can be traced to corruption in producing these books.

“But what do journalists in TV, print and radio want to convey with stories like these? Is it to reach citizens, like us, about unsavory things happening? Is it to inform those influential personalities about unacceptable practices in public as well as private schools?

“How many more Acsa Ramirezes, Jun Lozadas and Major Marcelinos must be made to suffer? There are too many to count now. Add to that, journalists who have lost their lives because they wrote the truth.

“Will journalists, like you, write articles for citizens, like me, so we’re filled with fury over what is happening at home? Or will Filipinos like you and me become ‘nitpickers or gadflies’ to foster reform?”

“Even those who aren’t being criticized can tire of the constant stream of complaints,” the British Broadcasting Corp.’s feature on “The Gadfly” warns. “Sometimes, they wish the gadfly will accept life as it is, and just get on… But one thing that keeps the gadfly on his task is the knowledge he is right. And the world would be a much better place if everyone else realized it.”

Antonio Calipjo Go and others painfully learned that being a gadfly is not for the faint of heart. “They must pick a cause they’re passionate about,” the BBC feature stresses. “Be content with small victories in the beginning. And work up from there… They will have to swim against the current … [But] they can take heart from all the gadflies who have gone before. Know that you’re part of a proud tradition.”

Must our school kids settle for what Lapus’ glib defense of “ungrammatical poetry”: “Stop, look, listen! / A car is roaring, too.”

Meanwhile, don’t inhale.

By Juan Mercado
Philippine Daily Inquirer
First Posted 00:59:00 02/12/2009