Friday, April 29, 2011

On intellectual property abolition, part 3

A number of libertarians call intellectual property rights (IPR) as intellectual monopoly rights. They argue that IPR is "evil because granting artificial rights to non-property restricts everyone else’s property rights."

One such article is by Jock Coats in the Adam Smith Institute blog. Coats' short paper today, Intellectual property: an unnecessary evil, argues further that

..."intellectual property" is a contemporary conceit to conceal crude market interference through state granted privilege with the flimsiest gossamer of respectability. The primary origins of patents lie in maintaining the state’s coffers, and of copyright in state censorship of ideas.

Property rights arise from a desire to prevent conflict over scare resources. Ideas, patterns, recipes and processes are non-scarce. Intellectual monopoly laws impose different time periods and restrictions...

19th century libertarians ranked Intellectual Monopoly as state created privilege that impoverishes the majority. We should heed them: they are still destructive, unnecessary, statist and evil.

It was a friend in facebook, a young German liberal thinker, who posted that article. I mentioned to him that top anti-IP libertarians like Stephan Kinsella want the abolition of all forms of IP -- copyright, patent, etc. They argue that ideas can never be owned. If I am an aspiring rock or rap star, I composed several good rock/rap songs, then I cannot say "I own" those songs. My friend replied,

You will still be recognized as the producer of that song and be able to make money with it, even without IP protection (contract law is sufficient). And with modern technology it is becoming increasingly difficult to protect IP and in the process of protecting them you are causing more harm to the principles of liberalism/libertarianism than otherwise. And by composing a rap song you will undoubtedly use some other form of IP in the process and should you not pay royalties to the inventor of rap? That seems absurd. And your song won't be scarce, if I copy it, I'm not taking anything away from you. Earning money will be more difficult for you, I grant that. But doesnt that create an incentive for quick production of new IP? This will create more dynamism and make it more difficult for monopolies to emerge, a major criticism of market-sceptics. And physical property - which must be protected - is being attacked on by protection of IP, as the ways you can use the former can be limited throuh IP protection.

I suggested in my earlier paper, On intellectual property abolition, part 2, that
it should be up to the IP owner if he wants to share his invention for free to all, or to be protected. Very often, the cost of enforcement is much much larger than the benefits of full enforcement, say of fighting song piracy, so many IP owners, except the big ones like The Beatles and U2 perhaps, won't bother full enforcement of their IPR.

I think the bigger debate on IPR is on expensive inventions like drug molecules. If the cost of inventing a new beer molecule (or compound of molecules) is not very high, then the new beer inventor/s may not press for full IPR protection. But in the case of drug molecules where the average industry cost of producing one successful molecule (successful meaning safe, hurdled dozens of clinical trials, and effective as killer of a particular disease) is up to $1 B, then such inventors will try to seek full IPR protection whenever possible.

One big opposition to IPR by the libertarians, liberals, anarchists and other shades of free marketers, is that it is a government (usually the Intellectual Property Office) that gives IPR. If that is a big problem for them, then it can be solved by having a private entity, say a federation of industry players, that can give such IPR. I discussed this in my other paper, IPR and medicines, part 7.

Do the anti-IP people consider a molecule or an atom as "non-tangible"? I still have to dig about this. But for me, a newly-invented molecule (or compound of molecules), say a drug molecule, tire molecule, beer molecule, etc. are tangibles. Water is a tangible object, it is composed of 2 atoms of hydrogen and 1 atom of oxygen (H2O). See also my other paper on the different molecules currently in R&D stage to treat prostate cancer alone, IPR and medicines, part 8.

The more directly related to health a molecular invention is, say a new anti-cancer drug, a new weight-loss food supplement, a new skin whitener, etc., the bigger the cost of inventing them. Inventors and manufacturers have to entertain the possibility that they can be sued someday by their customers if the latter will suffer some adverse health results, or at least if the promised "miracle" did not happen. If there is huge costs in the R&D of such drugs or food supplement or ointment, if there is huge costs in possible future legal battles over the safety of such new products, then the inventors and manufacturers need to price their new invention at a higher level, via the temporary monopoly period (a patent, copyright, etc.).

Some anti-IP libertarians can unwittingly merge ideologically with the leftists and socialists in arguing for the eradication of IPR in drugs. The higher price of new and patented drugs compared to off-patent and older ones is, for them, proof of the evil of IPR. And this is another dangerous mistake that free marketers from whatever shade should avoid committing. Pricing is a private property right. It can never be communal or government right.

Thursday, April 28, 2011

APTU meeting in Bangkok, April 2011

The Asia-Pacific Taxpayers Union (APTU) will hold its annual meeting in Bangkok, Thailand, late this week, April 29-30. Venue will be the Rembrandt Hotel. I am supposed to be a part of this meeting, but I could not find a local sponsor to finance my trip.

APTU is the regional "branch" of the World Taxpayers Association (WTA). Members of APTU and WTA are taxpayers' associations or organizations or unions in various countries that fight for low and simple taxes, accountable government and taxpayers' rights. Minimal Government Thinkers, Inc. which I represent, is not exactly a member of APTU because MG is a think tank, not a taxpayers' movement. But we got into the APTU network because "small government, small taxes,..." are among our major advocacies.

This is my favorite picture in the WTA network. Bjorn, the Secretary General of WTA and Chairman of APTU (left), Grover Norquist, President of Americans for Tax Reforms (ATR), and me. This was during the 3rd Pacific Rim Policy Exchange held in Singapore in late September 2009. WTA and ATR are among the major sponsors of that big conference. ATR is also a member of WTA.

Among the members of APTU are the Korea Taxpayers Association (KTA), represented by its President, Mr. Kim Suntaek, 2nd from right, and the Mongolians for Fair Taxes and Wise Spending, headed by Jargal Dambadarjaa, right. KTA is perhaps the biggest taxpayers movement in the whole of Asia as they have several hundred thousands of dues-paying members. This picture was also taken during the Singapore conference in 2009.

Another affiliate of APTU is the Lion Rock Institute (LRI) in Hong Kong, headed by Peter Wong, here speaking. Some LRI fellows and members were the founders of Momentum 107, a taxpayers' movement in HK.

Some may wonder why HK, having among the lowest tax rates around the world, would need a taxpayers movement, or a free market think tank. Precisely the point, as there are moves by some HK politicians, to raise certain taxes, to expand government, to provide more welfarist programs, to enact interventionist policies like having a minimum wage law and creating a new bureaucracy, an Anti-Trust Commission. LRI and Momentum 107 are among the vocal groups that oppose such moves, to remind the HK government that HK progressed because of free market, not because of government interventionist policies.

Another important member of APTU is the Japanese for Tax Reforms (JTR) headed by Masaru Uchiyama or simply "Mr. You", leftmost. Mr. Raymond Ho, rightmost, is the the head of Momentum 107-HK, rightmost. Picture taken during the 4th Pacific Rim Policy Exchange in Sydney in late September 2010. Beside Mr. You is Khalil Ahmad, the head of Alternate Solutions Institute, Pakistan's real free market think tank, based in Lahore. AS Institute is not a member or affiliate of APTU yet.

I wish Bjorn and the participants from various Asia-Pacific countries, success in holding the annual meeting and conference.

Wednesday, April 27, 2011

Fiscal irresponsibility 10: Rich countries' public debt

The overall trend in gross debt of general government among rich countries as percent of their GDP, say from 2000 to 2010, is rising. Only a few have managed to reduce this ratio.

The IMF released its World Economic Outlook (WEO) 2011 Report this week. I usually go to the database section immediately to search for my favorite topic then, GDP size based on purchasing power parity (PPP) valuation of country GDP.

This time, I searched the public debt of many governments to see if they are learning to live within their means or not. My quick suspicion is that the answer is NO. And here's what I got for the rich countries (click on the table to see a larger image):


Except for Belgium, Israel, Switzerland, Denmark and Sweden, all of them have rising ratio of debt/GDP. Well, some have very low debt ratio, like Australia, Luxembourg, Russia and Hong Kong.

These numbers are generally understated. For one, they do not include debts of their local governments (states, provinces, cities or counties). Two, they do not include contingent debts and liabilities, or debts by local governments and private entities guaranteed by the national or central government.

I was also surprised to see the high debt ratio of Singapore, 105 percent of GDP in 2009. But like Japan, the bulk of their public debt is from local sources, from their own citizens and local banks. So there is no immediate foreign exchange risk adjustments in debt payment someday.

Easy for so many governments to keep bloating their public debt. The current administrations simply inherit the wastes, inefficiencies, if not robberies and other forms of fiscal irresponsibility, of the past administrations. Thus, their tendency is to get a new round of debts on their own and let the future administrations worry how to pay them later.

Tuesday, April 26, 2011

Fiscal irresponsibility 9: ATR and the soul of limited government

There is an on-going protracted debate whether to raise taxes in the US to reduce the fiscal bleeding of the US federal government each year, caused by past and present fiscal irresponsibility by the occupants of the White House and the leaders in Capitol Hill. But such debate is not so much between the Republicans and the Democrats, but within or among Republicans themselves and their supporters.

Dan Mitchell of Cato wrote today a good article, Tax increases are political poison for the GOP, about the debate between Sen. Tom Coburn (R-Oklahoma) and Grover Norquist, the head of the Americans for Tax Reforms (ATR). The former is arguing that Republicans should accept some tax hikes and compromise with the Democrats to reduce the budget deficit, the latter is arguing that such compromise will result in even bigger government, not smaller, in the future. Dan Mitchell wrote,

From an economic perspective, there are all sorts of important issues:

1. What is better for the economy, lower spending or higher taxes?

2. Is it possible to balance the budget without higher taxes?

3. Would tax increases be used for deficit reduction or more spending?

The US federal government is projected to have another double-digit budget deficit this year after a similar deficit of more than 10 percent of GDP last year. Chart is from The Economist, Buy now, pay later, April 13th 2011 issue.

Politicians, even from a political party that is supposed to advance limited government, fiscal responsibility and free market, are generally easy to be hoodwinked into believing that more taxes, not more spending cuts, will promote more economic growth and more job creation (and reduce poverty) over the long-term. It is important, therefore, that independent and private think tanks and citizen pressure groups which are not organizationally part of any political party -- like the ATR -- exist and do their work of reminding elected politicians of their pledge to the voters when they were still campaigning.

There is no way that more taxes, more transfer of money from the citizens' pockets to the state and politicians' whims, will promote fiscal and personal responsibility. Where there is fiscal irresponsibility, personal irresponsibility would quickly follow. When government for instance, would subsidize healthcare even for unhealthy lifestyle-acquired diseases, then more people will become less watchful, less responsible, about their personal health.

Grover and his staff at ATR are doing their job well. But even their best effort will not be enough to block politicians' populism and its slow slide towards more statism, more welfarism, and ultimately towards the "big bang" of a real fiscal crisis. Ordinary citizens -- Americans, Europeans, Asians, and so on -- should realize that surrendering their personal freedom to state or collective freedom will be counter-productive.

Independent and free market-oriented think tanks like ATR and Cato can only help provide the philosophical guideposts and economic studies. The ordinary people, aware of the limits of government and their individual potentials, will have to put the future into their hands now.
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Related topics here will be

Fiscal irresponsibility 4: US public debt, and

Fiscal irresponsibility 5: US entitlement spending.

Monday, April 25, 2011

Asian free market websites, part 2

If improvement in alexa's global traffic ranking is one of many indicators if the free market perspective is gaining in Asia or not, then I can say that somehow we ARE gaining.

I again checked today alexa.com the global traffic rank (out of possibly a billion or more blogs and websites worldwide) of the websites of our fellow free market think tanks and groups in Asia. The geographical audience reference is a direct quote from alexa. Here they are.

1. www.cfe.org (Center for Free Enterprise, Seoul, S. Korea)
1 month 301,481
3 month 588,476

2. www.newasiarepublic.com (NAR, Singapore)
"… We estimate that 83% of the site's visitors are in Singapore, where it has attained a traffic rank of 3,529."
1 month 784,742
3 month 852,105

3. www.ccsindia.org (Center for Civil Society, Delhi, India)
"... The site has attained a traffic rank of 91,915 among users in India, where about 91% of its audience is located."
1 month 863,822
3 month 866,094

4. www.unirule.org.cn (Unirule Institute of Economics, Beijing, China)
"…We estimate that 75% of visitors to Unirule.org.cn come from China, where it has attained a traffic rank of 174,933."
1 month 1,450,959
3 month 1,028,386

5. www.freemarket.kg (Central Asian Free Market Institute, CAFMI, Bishkek, Kyrgyztan)
1 month 1,759,160
3 month 2,994,808

6. www.deas.org.my (Institute for Democracy and Economic Affairs, IDEAS, KL, Malaysia)
"…. Almost all visitors to the site come from Malaysia, where it has attained a traffic rank of 29,258."
1 month 2,991,200
3 month 2,264,898

7. www.lionrockinstitute.org (Lion Rock Institute, LRI, Hong Kong)
1 month 3,924,339
3 month 4,134,017

8. www.minimalgovernment.net (Minimal Government Thinkers, Manila, Philippines)
"...Roughly 77% of the site's visitors are in the Philippines, where it has attained a traffic rank of 73,906."
1 month 4,089,115
3 month 5,223,079

9. www.akademimerdeka.org (Freedom Institute, Jakarta, Indonesia)
1 month 5,074,539
3 month 5,953,841

10. http://azadliqciragi.org (Free Minds Association, Azerbaijan)
1 month 5,220,866
3 month 1,734,774

11. www.readtheboss.com (The Boss, Kathmandu, Nepal)
1 month 6,140,892
3 month 4,428,197

12. www.asinstitute.org (Alternate Solution Institute, Lahore, Pakistan)
1 month 6,194,792
3 month 6,183,338

13. http://efnasia.org (Economic Freedom Network-Asia, Bangkok, Thailand)
1 month 10,695,861
3 month 19,171,202

14. www.doimoi.org (Reform and Development, Hanoi, Vietnam)
1 month 15,816,260
3 month 15,130,801

15. www.indefenceofliberty.org (Liberty Institute, Delhi, India)
1 month -
3 month 22,635,351

16. www.ebi.mn (EBI, Ulaanbaatar, Mongolia)
1 month -
3 month 25,668,140

Those with "No Data" yet, but are definitely free marketers:

1. http://feijapan.wordpress.com (Free Economy Institute, Tokyo, Japan)
2. www.samridhi.org (Prosperity Foundation, Kathmandu, Nepal)
3. http://lgn.org.np/ (Limited Government Nepal, Kathmandu, Nepal)

Now, comparing their global rank last April 5 this year, see my earlier review, Asian free market websites, here are the sites that jumped high in global 1-month rank in just three weeks:

a. CFE, Korea: from #562,219 up to #301,481!
b. CCS, India: from #935,512 up to #863,822
c. CAFMI, Kyrgyztan: from #3,487,932 up to #1,759,160
d. LRI, HK: from #5,327,369 up to #3,924,339
e. MGT, Philippines: from #6,521,950 up to #4,089,115
f. The Boss, Nepal: from #7,335,497 up to #6,140,892
g. FI, Indonesia: from #9,321,814 up to #5,074,539
h. ASI, Pakistan: from "no data" up to #6,194,792

Congratulations, Chung-ho Kim (CFE), Parth Shah (CCS), Michu Namazaliev (CAFMI), Peter Wong (LRI), Charu Rizal (The Boss), Luthfi Assyaukanie (FI), and Khalil Ahmad (ASI)!

A few friends' sites suffered some minor decline though.

a. NAR, Singapore: from #727,229 down to #784,742
b. Unirule, China: from #934,154 down to #1,450,959
c. FMA, Azerbaijan: from #4,726,623 down to #5,220,866
d. RD, Vietnam: from #13,856,101 down to #15,816,260

More updates in the coming weeks.

Provincial notes 1: Negros Occidental

(Note: I wrote this in my now inactive travel blog, http:travelpinoy.blogspot.com, last August 8, 2006. The photos I just added today)

Negros Occidental is the Philippines' 3rd or 4th most populous province outside of Metro Manila. And while many of the 80 provinces in the country do not have a single city yet, Negros Occ. has 13 cities.

The province is generally flat, but 2 huge mountains can be seen from a distance, especially from a plane preparing to land in Bacolod airport -- Mt. Silay on the left and Mt. Kanlaon on the right. Mt. Silay is an old volcanic formation that has remained inactive. It has a number of summits, which are bounded by many cities in the northern part of the province – the cities of Silay, Victorias, Manapla, Cadiz and Sagay. Mt. Kanlaon on the other hand, is an active volcano and communities and villages on its foot are occasionally threatened with forced evacuations whenever the volcano is rumbling. The mountain’s summit is bounded by a number of cities and municipalities of the 2 neighboring provinces of Negros Occidental and Negros Oriental.

(Photocredits: Mt. Silay, http://www.oocities.org/siba_ph/Silay2.html; Mt. Kanlaon, http://www.travelphilippinesnow.com/tag/mount-kanlaon)

Sugarcane plantations make the 2 provinces look green from above, especially from a plane. To unfamiliar eyes, those sugarcane plantations look like the wide rice plantations in Central Luzon and Cagayan Valley regions in mainland Luzon.

Until about 3 years ago, you will seldom see idle lands. Something like if you travel 70 kms. north of Bacolod, passing by the cities of Talisay, Silay, EB Magallona, Victorias, Manapla, Cadiz, and Sagay, the chances that you will see idle lands of at least half an hectare area for every 5 kms. was about 3%. That is, for every 5,000 meters say on the right side of the road, there are about 150 meters combined length of idle lands. Now, you'll see idle lands of about 5-7% for every 5kms. This might seem a near-doubling of idle lands, but compared to other provinces, in fact to all 79 other provinces, Negros Occidental still has the most optimal land use (or the least hectarage of idle lands).

Idle lands develop through a series of land conversion: originally from forest land to sugarcane land, to vegetable farms and fruit orchard, to temporarily idle lands, later to residential or commercial lands. With the on-going construction of an international airport in Silay City (about 16 kms. north of the current airport in Bacolod), plus the emergence of high-end real estate projects developed by Ayala Land in Talisay and Silay, speculation for more real estate projects in surrounding areas is higher.

Roads from Bacolod northwards are generally in bad shape. The main culprit are the hundreds of heavy trucks that carry sugarcane to various sugar milling companies. Among the biggest are Victorias Milling Co. (VMC) in Victorias City, and Philippine-Hawaiian Sugar Milling Co. in Silay City. A six-wheeler truck could be carrying around 12 metric tons (MT) of sugarcane + truck body weight of at least 2-3 tons. Ten-wheeler trucks could be carrying around 20+ MT sugarcane + their body weight, while haulers, those 18-wheeler long trucks could carry some 30 MT+ of sugarcane + their body weight.
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Addendum: April 25, 2011

I thought of re-posting this as a follow up to my earlier article, Back to our roots.

In relation to agrarian reform program in this country, or the forced land redistribution with no timetable, the sugar plantations in Negros and a few other provinces are perhaps the clear example that medium- to large-scale farming are often more preferable to micro- or small-scale farming of one hectare or less. Land cultivation and preparation for the next cropping are done by big tractors and machines, not carabaos (water buffalo) or hand tractors, increasing the pace of planting while reducing the cost of production.

I say "land redistribution with no timetable" because while forced land reform in Taiwan, Japan and S. Korea were successfully implemented in just 1 to 3 years many decades ago, agrarian or land reform in the Philippines is now almost 40 years, counting only from former President Marcos' PD 27 or land reform law in 1972, and no definite timetable yet of when it will finally be stopped and closed.

Going back to our roots

I was born and grew up until high school in a barrio (village) in Cadiz City, Negros Occidental province, in Western Visayas region. Negros island is divided into two provinces; Neg. Occidental or western side is mainly Ilongo or HiIligaynon-speaking, Negros Oriental or eastern side is entirely Cebuano-speaking. The capital cities of Occidental is Bacolod, of Oriental is Dumaguete.

The major economic activities in the two provinces are fishing and sugarcane farming. In Negros, you can look far away and as far as your eyes can see, up to the foot or midlands of big mountains, there are vast sugarcane farms and plantations.

There are many big sugar milling companies (or “sugar central”) in the two provinces. The most famous of which is Victorias Milling Co., midway between Bacolod and Cadiz City.

The nearest sugar central to our place is Lopez Sugar Corporation. The Lopezes here would be related to the Lopezes of the ABS-CBN TV network.

Huge trucks carrying heavy loads of sugarcane, from at least 10 tons to possibly 60 tons excluding truck body weight, are normal scenes in our roads. And they travel round the clock, morning till evening, either with cargo or empty.

The road system is heavily stressed with those heavy vehicles. Although most roads are strong enough to withstand them, some roads are heavily victimized by government corruption, substandard materials were used, so that after several months of road repair, huge cracks and potholes would re-appear.

Cadiz is the northernmost city of Negros island. A major livelihood for many city residents is fishing. Huge fishing boats and trawlers are parked in the city’s port and private docking.

Lower picture, very long fishnets are being repaired by workers on both sides of the road.

I like my birthplace, my family especially. They are my roots. But since moving out of my province after high school and studied at the University of the Philippines (UP) in the 80s, I have been going home less often.

Upper photo is my parents’ current house. Lower photo is the flower garden that my elder sister maintains. It is relaxing to see the house where I was born more than four decades ago. Well, this is actually a “new” house on the same location as the old one has been slowly replaced, from the living room to bedrooms to the kitchen. We are lucky that my other elder sister is rich enough to finance all the home improvement.

My mother is now 77 years old, my father is 83. Both are already weak and sickly. Sometimes the hospital would be their “second” home. This picture was taken last year. I brought my only child then, Elle Marie, who was 3+ years old.

Elle was holding a sugar cane, on a cargo truck. When we were young, we had few neighbors, a sugarcane farm is just a few meters away from our house. We would go in and out of the sugarcane field to play hide and seek, to find spiders, or simply to unload poo-poo. Now we have several new neighbors, but the sugarcane fields are still not far.

I went home a few days ago, last week, brought my wife and two daughters. Here, my mother and her 6+ months old granddaughter, Bien Mary. They are almost four generations apart.

Going back to my roots, my parents, siblings, relatives. Then leave them behind as the short visit is ending. We were preparing to leave in this picture, go to Iloilo to visit my in-laws. Elle Marie (held by my wife) is now 4+ years old.

I told my Papa and Mama that we will be coming home again this December. Seeing my parents getting older and weaker makes me sad. But life is a cycle.

Parents should think forward, “When my kids grow up and mature someday, will they be proud of us or consider us as their roots?” And kids should also think forward, “Have I been thankful and proud of my parents, my roots? Would I wish my own kids someday to treat me the way I treat my parents now?”

Building a just and peaceful society is all about personal and parental responsibility. It has little to do, sometimes nothing to do, with government responsibility. It’s about building solid roots that will bear solid and morally upright kids and branches someday.

I am proud and thankful of my roots. I will work hard so that my kids will be proud of their roots someday too.

Sunday, April 24, 2011

Filipino Religiosity 2: Iloilo Holy Week Procession

I took the succeeding pictures last Good Friday, April 22, 2011, in one barangay of Lapaz district, Iloilo City. My in-laws live in Lapaz.

They have 2 groups of procession. The first is the group of the Independent Catholic or Aglipay. Their number is not so big but they have many carriages of the different statues of Jesus. The lower picture here for instance is a big carriage portraying the Last Super.

The flower decorations of the carriages and statues are beautiful and very colorful. Devotees really spend time and money to produce a beautiful procession. It should reflect their religious faith.

I took these pictures as they were still assembling for the procession that would start at 6pm. Those carriages have big and bright bulbs to lighten Jesus’ statues when the procession would drag by evening.

A group of devotees in black wardrobe and carrying various symbols of Jesus. Note the old man in maroon wardrobe, with thick moustache and long hair. He would look like Jesus and would be carrying a huge wooden cross.

They would be following the carriage of Jesus carrying the huge cross.

The black wardrobe men with green headscarves.

A group of mostly senior women who recite certain prayers and novena as they walk.

This is the head of the Roman Catholic procession. Young boys in white dress, walking in praying position.

They would be followed by some senior men in dark suits with colorful addendum to their attire. Turned out that the man in the middle was one of our wedding sponsors  I did not immediately recognize him, he approached me after I took the picture, and I bowed before my Ninong.

The Roman Catholic really pack with tens of thousands of devotees and participants. The procession has not started yet, but the crowd was so thick, it was difficult to pass through. I think many have been standing there since 4pm or earlier and waiting for the procession to start.

Another huge carriage of the Last Super. This was put in a small truck.

I think the Catholics in Iloilo are among the serious devotees to the religion. I say this because this huge number of participants represent only a fraction of Lapaz, which in itself is just one of the many districts in Iloilo City, and this city is just one of the many cities and municipalities in Iloilo province.

I don’t know, I may be wrong because I did not see the other processions in other cities and provinces. But the huge turn-out in the annual procession during Good Friday shows how strong the Catholic religion is in many parts of the country.

(See my earlier photo-essay, Filipino religiosity part 1)

Saturday, April 23, 2011

Lent and the crucifixion of climate science

(This is my article yesterday in thelobbyist.biz)

Today is Good Friday, the day that Jesus was crucified and nailed on the cross, based on Catholic teaching. And today is also the “Earth Day”, the day that people should remember to “save the planet”, that our planet is in a crisis, is in danger. From whom?

The continued alarmism on “man-made warming” or its cousin, “man-made climate change”, is proof of continued crucifixion, of continued torture and bastardization of climate science. According to this cult, there is no such thing as global cooling, there is only “unequivocal” or definite global warming. There is also no such thing as natural climate cycle of warming-cooling-warming-cooling, there is only “unprecedented” climate change.

Below are the graphs of sea ice extent and satellite pictures, of the Arctic on the left and Antarctica on the right, as of April 21, 2011.

Years covered in the graphs are from 2002-2011 in the Arctic, and 2003-2011 in Antarctica. All data are from WUWT’s sea ice reference page, http://wattsupwiththat.com/reference-pages/sea-ice-page/

The above graphs are simply saying that the polar ice in both the Arctic in the north and Antarctica in the south, are simply on a regular cycle of melting-growing each year. There is no such thing as “ever-melting” or “melting faster than usual” ice in both ends of planet Earth.

As of this week, there are some 13 million sq.kms. of ice in the Arctic, a slight decline from its peak of some 14 million sq. kms. as of early March this year. Antarctica has around 7 million sq.kms. of ice, recovering after its annual low of some 2.5 million sq.kms. as of late February this year.

The two satellite pictures simply show the actual size of the ice in both ends of the planet as of this week.

The “ever-melting” polar ice is among the central fear-mongering campaign of the man-made warming cult, because that would mean rising ocean level, the flooding and inundation of so many cities and several small, low-lying countries. Which in turn will create hundreds of millions of “climate refugees” in so many countries around the world.

I am here in Iloilo City as I write this. I came from Cadiz-Bacolod cities yesterday. Two days I was there, it also rained on those two days. It is refreshing to have regular rains, or at least cloudy sky like here in Iloilo, even in late April.

What is ridiculous in the claims of the man-made warming cult is that when there are less rains and prolonged drought, it is due to man-made warming. When there are more rains and more flooding, it is also due to man-made warming. Whatever climate or weather we have, humanity and its modernization is evil for “destroying” the planet.

And that possibly represents the height of idiocy, and continued crucifixion, of climate science until now. Courtesy of the United Nations, many governments and the rent-seeking environmental NGOs.

Friday, April 22, 2011

Fiscal irresponsiibility 8: Finland's dislike of EU and bail-outs

The European Union (EU) is perhaps the biggest bureaucracy in the planet on a per capita basis. The bureaucracy's penchant for almost all sorts of subsidies, welfare and regulations is costing taxpayers from member countries lots of money.

While the EU is imposing certain fiscal "disciplines" like the budget deficit of member-economies should not be more than 3 percent of GDP on any given year, I think almost all governments of member-countries, except Norway, have regular budget deficit. Meaning they live beyond their means; they spend more than their annual revenues (taxes, fees, etc.).

Now many voters of Finland have supported a political party with harsh words against the EU, against the additional bail-out money to Greece and Ireland, and against heavy subsidies to many refugees. The voters are saying that they've had enough of more fiscal irresponsibility, of bailing out highly fiscally irresponsible governments like those in Greece, Ireland and Portugal.

There is one good news report today in NYT, Finland’s Turn to Right Sends Shivers Through Euro Zone
By SUZANNE DALEY and JAMES KANTER
Published: April 21, 2011

Mr. Soini... who is 48 and has been active in politics since he was 17 — repeatedly lashed out at the European Union. (He is fond of calling it “the heart of darkness.”) A true democracy, he has said, is “only possible in individual states.”

“Soini talks ordinary language with ordinary words,” said Ville Pernaa, the director of the Center for Parliamentary Studies at the University of Turku in Finland. “He told the voters that they were wasting money paying for other people’s debts. Why should they pay for that when we need more doctors in the small towns of Finland?”

Perttu Pouttu, a retired worker for a Helsinki energy company... “Of course the bailouts raise questions,” he said. “Will we get that money back? Where are the banks? This is their problem.”

At the same time, Mr. Pouttu said he was worried that Finland had admitted too many refugees. “It does not touch me personally,” he said. “But it bugs me that by law we have to give them apartments. When I retired, no one gave me an apartment.”


Mr. Soini, leader of the True Finns Party, may be urged to soften his attack of the EU and the proposed additional bailout money for some highly troubled European economies. But if he does so, then the voters who supported him and his party may get angry too.

It is a good start that a small but rich country like Finland will remind many European governments and the EU bureaucracy, that fiscal irresponsibility and ever-growing government size is wrong.

Wednesday, April 20, 2011

On intellectual property abolition, part 2

After writing On intellectual property abolition yesterday, it attracted 3 comments. See my reply to them in the comments section of the article.

I also posted yesterday that link in the comments section of Stephan Kinsela's article, The Four Historical Phases of IP Abolitionism. There were several other comments after I posted mine. I post 3 of them below:

(1) Edgaras, April 18, 2011

Who argues that nonsense? To argue, that people should be forced not to act with their property as they see fit just because some “scientist” had this precious idea first and would like that no one used it in his “way” – that is dictatorship. Owning ideas is owning other people. And this is argued by most of the IP proponents. Or at least, it’s a logical conclusion of their ideas.

(2) Stephan Kinsella, April 18, 2011

They aren’t forced to share it. If they want to keep it secret, fine. but if they decide to make it public–for example by selling it–then they cannot whine when others use the information.

(3) Edgaras April 19, 2011

Abolishing IP won’t prevent producers from producing. Reality debunks such inane claims by thousands of examples. I hope I don’t need it to mention… Take for example all the open source and creative commons music. Take for example free books by many authors who profit from donations. Jeez.


Below are my rejoinders to those comments.

On #1. "Owning ideas is owning other people." I find zero connection between the two. I say for instance, "I own this blog." Did I own other people, or did I control their lives? They too, can also start and own a blog of their own, it's fast and free, courtesy of blogger, wordpress and other sites.

On #2, by forcing the abolition of IP, proponents are forcing the sharing of ideas that some idea owners may not be happy to do without some compensation or even citation. Owners of idea -- a song composition, a picture or cartoon, a new drug molecule, a new tire molecule, etc. -- decide whether they want their ideas to be shared for free with the rest of humanity, not some ideologues or government bureaucrats. If idea owners want their intellectual output be used publicly in exchange for compensation, say a new drug or a new tire, then they should be respected. IP abolition proponents want total disrespect for ownership of ideas.

On #3, "Abolishing IP won’t prevent producers from producing." True. But keeping IP will also encourage actual and potential producers to produce more. Rock band A composed and produced 500+ songs, all copyrighted. Rock band B composed and produced 400+ songs, all copyrighted. Rock band C composed and produced 75 song, all copyrighted... Rock band Z produced and composed 200+ songs, and so on.

Currently, people are allowed to say, "I composed that song, I own it. But other people can also sing it, play it, knowing that it was me who originally composed and sang it." The IP abolitionists argue that ideas, like a song composition, cannot be owned. Thus, no one can say that "I composed that song, I own it." To me, that is unfair.

Meanwhile, below are portion of the long comments made by Paul, who is a friend and owns Colorful Rag blog. He wrote,

...I would maintain that ideas are not ownable. Hans Hermann-Hoppe points out that IP is not only illegitimate, but it is actually CONTRARY to physical, scarce property rights. When you claim ownership of an idea, what you are doing is actually claiming control over what other people do with their physical property. This means a person is unable to truly exercise their control over their computer when prohibited from downloading this or that. Or, one does not actually have control over certain owned physical materials meant to be used to create medicines, because of IPR restrictions...

I also mention in the book I gave you that the logical inconsistency of IP as property is quite apparent when an architect is commissioned to build a house. If we are to be consistent with the belief in IP, this would mean that the very house he is designed to make is his to control. Only by some logical wrangling does the actual owner retain title.


If I am a struggling rock artist and I hope to earn some stable income (if not become rich) someday by composing and singing more rock songs on more subjects, then I wish that some protection be given to me so that I can be compensated for my ideas, for my effort. The IP abolitionists say that I am not entitled to claim ownership of my own song compositions. Implying that every Tom-Dick-Harry can sing any or all of my songs, perform rock concerts or do big product endorsements on my songs, and not a bit of originality and authorship can be traced to me.

One implication of this proposal is to encourage plain copying and laziness in innovation. Why innovate and invent on some useful products like a new life-saving medicine or a new race track-hugging tire, which requires huge amount of money, research work, multiple clinical trials, and take many years to finish, when the inventors cannot even be allowed to claim ownership of their own inventions?

An architect who designed a house can only claim ownership of the design, the one on paper, not the house itself. But since the owner of the house already paid the architect, it is the house owner who will decide later whether he will follow all the designs made by the architect, or introduce new revisions, or throw away the design and commission another architect or other artists to do the job. Whatever the house owner will decide later, the architect can afford to be indifferent as his idea, the house design, was already compensated for.

I repeat, private property is private property. It is not communal or government property, whether physical property or intellectual property.

Climate cycle and forecasts

There are lots of climate data and graphs that are freely available on the web. And what's more, they are updated monthly or weekly, if not daily. The peddlers of "man-made warming" or its more popular cousin, "man-made climate change" cannot show those graphs and data because the data also say that there is such as thing as "global cooling" aside from "global warming." And that what we really have are "natural climate cycles" and not "unprecedented man-made climate change".

Here is the latest data on the status of La Nina in equatorial Pacific. Above is for Nino region 3.4, below it is Nino region 4. The sea surface temperature (SST) anomaly as of April 17, 2011 in both regions was still in the negative territory, around -0.4 C.

The current La Nina is now 11 months old, SST anomaly went negative in May 2010. Data/graph is from Australia's Bureau of Meteorology, http://www.bom.gov.au/climate/enso/indices.shtml

Here is the medium-term SST anomaly record for Nino 3.4. Above graph shows data from mid-2006 to present. This (upper) graph shows data from 2000 to present. Cooling in 2000-2001, warming in 2002-2005, slight cooling in 2006, slight warming in 2007, cooling in 2008 - early 2009, warming in mid-2009 to mid-2010, then current cooling.

Lower graph shows the area where those Nino regions 1 to 4 are. Region 3.4 is the biggest or widest area, situated in the middle of equatorial Pacific Ocean. Nino 4 is the one closest to East Asia like the Philippines. These 2 graphs are from WUWT's ENSO page, http://wattsupwiththat.com/reference-pages/enso/.

For those in the Philippines, Vietnam, Thailand, Indonesia and other parts of East Asia, they will notice the colder-than-normal (or colder than the average) breeze and air temperatures, especially at night time. Why?

One explanation could be that as La Nina slowly retreats from equatorial Pacific, the warmer-than-normal sea water that La Nina pushed down and showed somewhere else (like in South China Sea) is also slowly coming back. Data is from http://www.osdpd.noaa.gov/data/sst/anomaly/anomnight.current.gif.

Forecasts: when will the current La Nina end? Upper graph is from CFS-NOAA as of this week. The various lines represent the various forecasts from different climate models. The black broken line is the average for all forecasts. They show that the current La Nina will persist until the end of the year and possibly beyond.

Lower graph is from Japan Meteorological Agency (JMA) and European Meteorological Organization (ECMWF). I got it from Joe Bastardi's No no El Nino (till 2012). The consensus or average forecasts say that La Nina will persist until end-2012 or beyond.

These 2 or more forecast graphs above speak well of the "reliability" of the UN IPCC and Al Gore climate models. If current climate models cannot predict with high certainty the temperature range just 3 to 10 months into the future, how can the IPCC models predict with certainty the world's temperature 90 to 100 years from now?

And why do we believe those far away temperature forecasts and guesses, when all weather forecasting agencies from all countries around the world that also use the latest and most sophisticated tools and techniques, cannot predict with high certainty the weather 3 days or 1 week from now? That is why the weather forecasts are updated and revised everyday, every 12 hours, or even every hour.

Tuesday, April 19, 2011

On intellectual property abolition

One thing that I find strange among some free marketers, especially among certain camps in the libertarian movement, is the rabid campaign to disrespect and abolish intellectual property rights (IPR).

One of the most important basis of individual freedom and personal liberty is the protection of private property rights. Your cellphone is yours and yours alone. It cannot be a cellphone of your neighbor or your friend or your city mayor or President of your country. If other people can say that "Your cellphone is also my cellphone; now, give it to me and I will use it the way I want to use it", then there will be no peace in society. Bullying and stealing is the rule of the game. And society can stagnate if not revert back to barbarism.

A group of libertarians argue that intellectual property (IP) is different from physical property. A song composition (an idea) is different from a cellphone or laptop; a blog article or magazine article or book (an idea) is different from shoes or pants or a tv set. The latter is physical property to which past and present laws and regulations on property rights apply. Thus, IP on song composition, on book (copyright) ownership, on drug molecule, should be abolished, partly because such property right was created and granted by government anyway.

There is one ideologue in the libertarian blog, http://blog.mises.org, Mr. Stephan Kinsella, who consistently argues for IP abolition. Of course there are many libertarians who also take his position.

I have argued before and I will repeat it: an idea is private property. This blog, or at least this particular blog article, is owned by Nonoy Oplas, and not by any leftist or centrist or rightist or what have you ideologue. Now it is up to the idea owner whether he/she wants his/her ideas to be shared to others for free, or be protected. If he wants to share it for free as it is part of his educational advocacies, then fine. If he wants the use of his ideas, his composition and invention, to be protected somehow, then it should be respected.

To argue that owners of ideas, composers of famous songs, authors of fantastic scientific or academic papers, inventors of important drug molecules, should be coerced, should be forced and arm-twisted, to share their inventions for free to other people, is plain dictatorship. How can such attitude be considered as advocating individual liberty?
------

Related and most recent article here is IPR and medicines, part 8.

Filipino Religiosity 1: Baclaran and Quiapo Churches

It’s Holy Week this week. Filipino religiosity, especially among the Catholics, is at its peak. The Philippines, being the only former Spanish colony in Asia, is also the only predominantly Christian and Catholic country in Asia.

This is Baclaran church, one of the big and famous churches in Metro Manila and in the country. I took this photo last Saturday late morning, so there was no mass, and there were few visitors to the church. But on regular mass hours, the church is overflowing with thousands of believers.

Many people go to the church to ask for some divine assistance and intervention to many personal and household issues and problems, especially related to livelihood and health, like one family member is on a 50-50 medical crisis situation.

A touch on the statue of Jesus on the cross gives some extra strength and hope to people that they can tackle their problems, with the help and support of Jesus.

Here are some of the merchandise being sold outside the church. Various designs, sizes and colors of the rosary; various sizes of the baby or young Jesus, statue of some saints, food and drinks, and so on.

Quiapo church, definitely a very popular church among millions of devotees around the country. The Black Nazarene is the most famous statue there, attracting hundreds of thousands during its annual parade.

When people become desperate and almost hopeless, many do not run to the government and the politicians or other rich people. They look inward and seek positive intervention by their God. Their faith is either tested or strengthened.

Some ideologues question the habit of people who turn to their God for assistance, instead of facing whatever problems squarely on their own and do practical solutions that are available and feasible. Believers counter that they are not becoming complacent when they turn to their God. They find solutions on their own, but there are certain factors that are better left to luck or divine intervention and turning to their God is a wise move both for their intellectual and spiritual improvement.

Filipino religiosity is relatively unique compared to most Asians who are mostly Muslim or Buddhist. Nonetheless, regardless of the religious belief that people hold, it’s the teachings of doing good to other people, of not causing harm to others, that help societies survive and modernize.

Monday, April 18, 2011

Labor Econ 3: Wages and Marginal Product of Labor

(This is my article today in thelobbyist.biz,

With the continued rise in the prices of oil, fare, electricity, food, other products and services, there is the usual clamor for a government-imposed wage hike across sectors. And the government announcement should preferably be done on Labor Day or two weeks from now.

This logic is faulty for two important reasons. One, employment in the private sector is a contract (wages, social security benefits, bonuses, leave with pay, etc.) between employers and employees, government is outside of this contract and thus, government imposition of wage hike is a distortion of this private contract. And two, wage is not a function of the changes in prices (increase or decrease) of oil, electricity, food and other goods and services; wage is a function of the productivity of labor in each firm, in each sector.

Consider this illustration and two graphs. A firm producing chairs, is deciding how many workers it should hire. Just 1, or 2, or 6 or more? There are fixed costs in the firm like office rental, average electricity bill, etc. The variable costs include number of workers (more workers, more costs, but hoping that it will also result in more sales and more profit).

The marginal product (or extra output) of each laborer is derived by deducting total output of say, 3 workers, with the output of 2 workers, and so on.


This illustration is suggesting that the firm should have only 3 or 4 employees, not 5 or 6 as the marginal product (MP) or extra output of the 5th and 6th workers are already low, if not zero. The MP curve (lower graph) is showing that a firm can make maximum profit with just 2 workers, but hiring a 3rd and possibly, 4th worker, can still increase the firm’s total product and hence, total revenues.

And that is how firms decide in how many workers to hire at what salary for each worker. The more skilled the worker, the higher is the wage plus other benefits.

If there is a pressure from the workers themselves, say through their labor union, to demand higher pay due to the rise in the prices of oil, electricity, food and other commodities, the employers and management may grant the wage hike demand, but that MP of each worker is also expected to rise. Thus, instead of producing an average of 8 chairs per day, workers will be expected to produce 9 or more chairs per day, through better tools and continuing training and skills improvement.

The more that people will think that the solution to economic problems is politics, the more politics and politician interventions they will get, and it will be counter-productive.

Wage and related benefits are mainly a function of, or determined by, labor productivity, not by the price of oil and other commodities nor by the number of children and dependents that a worker has.
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See also:

Thursday, April 14, 2011

Filipino free market blogs, part 3

Now the tide is slowly moving towards the free market, individual liberty movement in the Philippines!

Why do I say so?
Less than two weeks ago, only 4 out of around 13 free marketer Filipino bloggers that I know of, have global rank in alexa.com. Meaning the other 9 blogs have "No data" for their 3-month global ranking.

Today, 8 have global ranks already. Blog numbers 5 to 8 below just jumped from "No data", meaning they could be somewhere in the 30 million+ global rank, up to 14 million + in last 30 days global ranking. Aren't those huge jumps? Which means that more and more people around the world are reading the ideas of Filipino free market intellectuals.

The #1 free market blog in this country is no longer this blog, but Prudent Investor Newsletters. The owner of that blog, Benson Te, is a friend and I am very happy for the huge jump in his global viewership. Benson is the most prolific writer among us, he posts about 3 articles a day on average including weekends. Me, I can write only 1 to 2 articles per day on average. Benson is a specialist on finance, commodities and other economic topics.

Well, I personally know and have met all the owners of the 13 blogs here, except Aristogeek. The philosophical leanings of the guys here range from the miniarchists (small, limited government) like me, to the anarchists (zero government, only purely voluntary and private organizations and enterprises) to the objectivists (Ayn Rand followers) and the relatively populists (toying with government intervention sometimes).

Ok, here's the list. The sentences in italics are alexa's assessment of where the bulk of their readers are coming from.

1. Prudent Investor Newsletters, http://prudentinvestornewsletters.blogspot.com

1 month 1,009,957
3 month 1,287,941
Prudentinvestor.blogspot.com has attained a traffic rank of 365,433 among users in the US, where we estimate that 50% of its audience is located.

2. Government and Taxes, http://funwithgovernment.blogspot.com

1 month 1,469,091
3 month 2,091,554
We estimate that 46% of the site's visitors are in the US, where it has attained a traffic rank of 545,578.

3. The Vincenton Post, http://fvdb.wordpress.com

1 month 2,630,963
3 month 2,322,103

4. Colorful Rag, http://colorfulrag.blogspot.com

1 month 2,907,062 -
3 month 5,727,885
Roughly 45% of visitors to the site come from the Philippines, where it has attained a traffic rank of 71,230.

5. Perpetual Cycle of Life, http://ctapang.wordpress.com

1 month 14,838,574
3 month 27,051,180

6. Laissez Faire Filipino, http://filipinofreedomfighter09.blogspot.com

1 month 14,839,428
3 month 27,052,216

7. HarryLeaks, http://harryleaks.blogspot.com
1 month 14,840,124
3 month 27,053,050

8, This is Joshua Speaking, http://joshualipana.wordpress.com
1 month - -
3 month 23,236,729

Other Filipino free market blogs but have no alexa global traffic ranks yet:

9. Acts of the New Commonwealth, http://libertadfilipinas.wordpress.com

10. Aristogeek, http://aristogeek.wordpress.com

11. A Second Look at Everything, http://professionalkibitzer.wordpress.com

12. Elevic Pernis - The Road to Weirdom, http://elevicpernis.com

13. Foundation for Economic Freedom, http://econfreerp.blogspot.com
--------

Here are the earlier global ranking:
Part 1, March 28, 2011
Part 2, April 6, 2011

Energy rationing 4: Anti-coal, anti-nuke hysteria

In one of my discussion googlegroups today, someone posted a campaign, "Please sign: Stop sacrificing the environment and the people's welfare on the altar of profit". Portions of the campaign said,

We, environmental advocates, members of the clergy and churchworkers, citizens, and leaders representing various organizations committed to defending the Philippine environment, unite to declare publicly our growing dismay over the state of ecological destruction and human rights violations under the administration of President Benigno Aquino III....

We challenge President Aquino to stop this sacrifice of the environment and the people's welfare on the altar of profit. We assert our calls for a genuinely pro-people, pro-environment and progressive policy of stewardship over our natural resources by pursuing the following specific demands:

1. Stop the liberalization of the Philippine mining industry.
2. Stop the killings and human rights violations of environmental advocates.
3. Cancel the permits and operations of big commercial logging firms in addition to the logging moratorium.
4. Impose a moratorium on the construction of new coal power plants.
5. Reject the proposal to revive the Bataan Nuclear Power Plant.
6. Scrap the Japan-Philippines Economic Partnership Agreement.

The writers and endorsers of this campaign possibly forgot that the President came from the Liberal Party, not from the Socialist Party or a Nationalist or Anti-globalization Party.

A liberal, in the classic liberal tradition or even the current European liberalism philosophy, respects the free enterprise system, not more business regulations, more prohibitions.

On their specific demands:

1. Stop the liberalization of mining industry -- and leave the industry only to local politicians and companies? Among the best practitioners of sustainable mining practices are the big multinationals which have global corporate brands and have modern mining and geological technologies to optimize mining with minimal damage to the environment. If we prohibit them from coming in, the mineral potentials of the country at the time that prices of important commodities and mineral products are very high, as well as the creation of many locals jobs, will not be optimized.

2. Stop the killing and human rights violations of environmental advocates -- I support this, we should support this. And not only environmental advocates, all political killings and human rights violations of ordinary citizens should be stopped. Especially by political warlords like the Ampatuans.

3. On commercial logging ban -- and leave the forests to carabao logging, local politicians logging? People need wood, whether we like it or not. The poor especially as they cannot afford the steel and cement housing, or aluminum/steel/glass furnitures. No commercial logging means zero supply of wood from legitimate sources, wood prices shoot up, and the bigger the temptation to do illegal logging by local politicians and carabao logging to take advance of the high prices of wood.

Commercial logging, supervised by licensed foresters and connected with long-term business contracts, practice sustainable logging. A logging concession area is divided into several blocks. For a 20-years cycle for instance, only 1/20th of the entire logging area is cut and cleared for a year, the remaining 19/20th of the area has thick forest, forever. It is to their business interests that there are trees to cut every year, so they keep planting every year.

4. Moratorium on the construction of new coal power plants, reject nuke power plants -- and what else to prohibit, natural gas plants, petrol oil plants? And what will the new houses, new factories, new schools, new offices, new shops and malls use, candles and firewood?

Many environmentalists advocate the renewables like wind, solar, biomass, etc. That's why we have the RE law, and the business cronyism associated with it as it gives lots of incentives and guaranteed profit for the wind farms, solar farms. Our already expensive power prices will soon become even more expensive due to mechanisms like feed-in-tariffs (FIT) and renewable portfolio standards (RPS).

I discussed the cronyism of the RE law here, Energy rationing 2: The Renewable Energy (RE) law. Dr. Willie Soon and Barun Mitra also produced a paper questioning the global energy rationing polices that restrict access of the poor to cheaper energy sources here.

5. Scrapping of Japan-Philippines EPA -- and go back to the old trade protectionism? That EPA is not exactly a free trade agreement (FTA) but it is better than going back to high protectionism.

The petition also mentioned the "Earth Hour". As I posted in Earth Hour lunacy, part 2, I wrote to the top 2 honchos of WWF-EH, Atty. Ibay and Mr. Yan where I sent them my article why the EH is a lunatic idea, they have one standard reply: silence of the lamb. Then I wrote a comment at the EH website comment section, they censored it. I consider the WWF as a bunch of noisy but coward environmental activists.

If the WWF officials and other environmentalist groups will protest my assessment of them, then I am open to any public debate with them on climate science and policy, anytime, anywhere. Leave a note of challenge at the comment section here.

Meanwhile, here is the latest data on global air temperature, composite for northern hemisphere (NH), tropics and southern hemisphere (SH). The lower troposphere temperature anomaly for March 2011 was -0.10 C. That is, the temperature in March 2011 was -0.1 C colder than the average temperature for all March from 1979 to 2010. Zero global warming, only global cooling trend now.

Here are the values, satellite data:

GLOBAL / NH / SH / TROPICS

2010
January 0.542 / 0.675 / 0.410 / 0.635
February 0.510 / 0.553 / 0.466 / 0.759
March 0.554 / 0.665 / 0.443 / 0.721
....
November 0.273 / 0.372 / 0.173 / -0.117
December 0.181 / 0.217 / 0.145 / -0.222

2011
January -0.010 / -0.055 / 0.036 / -0.372
February -0.020 / -0.042 / 0.002 / -0.348
March -0.099 / -0.073 / -0.126 / -0.345

Data and graph source is Dr. Roy Spencer of the Univ. of Alabama in Huntsville (UAH).

Wednesday, April 13, 2011

Telecom oligopoly 2: Slow internet in the Philippines

Where there is lack of competition, there is generally lousy service and/or expensive prices. A monopoly (single producer) or oligopoly (few producers) have little incentive to really improve their service or bring down prices. Consumers have little or no option anyway but buy from them, so why spend big money to innovate hard?

There's a good article by a friend, Harry Santos, in his blog today, Why is the Internet Slow in the Philippines. I went to his primary data source, netindex.com and here is the ranking of 170 countries covered as of April 11, 2011. Click on the picture to get a large image.


South Korea has the fastest internet connection all over the world with a whooping 36.64 Mbps. It is followed by Sweden, Lithuania, Aland Islands, Romania, Latvia, Netherlands and so on.

Among other Asian countries, here are their ranks and internet speed, in Mbps:

16. Singapore, 16.48; 17. Japan, 15.94; 23. Taiwan, 13.58;
45. Vietnam, 7.99; 48. Macau, 7.60; 65. Thailand, 4.97;
72. Mongolia, 4.60; 74. China, 4.38; 93. Malaysia, 3.00;
95. Brunei, 2.96; 124. Nepal, 1.98; 125. Philippines, 1.98
129. Cambodia, 1.83; 137. Pakistan, 1.54; 139. India, 1.53;
144. Indonesia, 1.41; 150. Sri Lanka, 1.28, 153. Afghanistan, 1.17;
156. Laos, 1.07; 164. Bangladesh, 0.78.

So one will naturally ask, Why are internet speed in S. Korea, Singapore and Japan, much faster than in the Philippines? Aren't we supposed to have fast internet connection because we are gunning to be no. 1 worldwide in business process outsourcing (BPO) business?

Harry said that S. Korea has 29 competing internet service providers (as of 2002) fiercely competing with each other. The Philippines has only 6 major players, 3 of which are owned by the Manny Pangilinan group -- Smart, PLDT and now SUN. See my related article, Telecom oligopoly 1: Smart takeover of Sun.

I've been suspecting that Pangilinan and his companies are now the new cronies of the past and present administration. Our economy is structurally allergic to fierce competition due to the 1987 Philippine Constitution that disallows the entry of foreign investments and players in many sectors of the economy, and the legislative franchising system for utilities and media. Then add the strong protectionist lobby by various local vested interests, from business groups to NGOs and media, business cronyism is not difficult to happen.

For NGOs, other civil society groups and academic institutions that seek corporate funding for many of their activities, be wary when those corporate interests that thrive on cronyism will be asking for certain "favors" from you later on.

Related article will be UN bureaucracies -- too many, part 2, it's about the plan of some bureaucrats and bureaucracies at the UN to regulate the internet.

Migration and Freedom 7: Restrictions to OFWs

A friend based in the Middle East, Cynthia D., commented to my earlier discussions now contained in Nanny state 2: Entrepreneurship vs. bureaucracies. She made the following observations on new regulations by the Philippine government that make it more difficult and more costly for aspiring overseas Filipino workers (OFWs) to be hired abroad. She wrote,


Hi Noy,

You are unfortunately correct about our country steadily becoming more of a nanny state. So many of the things that are done supposedly for 'the good of our people' end up either reducing our freedoms or are simply ruses to line different official's pockets. One of the things that has really bothered me over the last two years are the continual additional items that our immigration personnel at the airports require for people to travel out of Philippines. About a year ago, for travelers to the Middle East, the airport authorities started wanting an approval certificate from the Phils. Embassy in the country people are traveling to which stated that the people are legally invited and their expenses will be taken care of while there. To obtain this certificate a foreign company or one of us living in that country has to write a letter to the embassy stating they will provide support and of course pay a fee to obtain the stamped and sealed certifcate. Each time I have people travel for interviews or visits since then the immigration people have steadily wanted more and more documents to the point that I can never be sure if the people will be refused from their flights for some new document. Of course they will let people through for a small gift of money but I always insist our visitors don't play these games.

The problem is that the people enforcing such requirements claim they are protecting our poor and 'ignorant' population from human trafficking or from being taken advantage of... If a person has a ticket and a visa to visit a country that is not on the banned list they should be allowed to travel, but according to our nannies, that is not necessarily the case...

It is especially frustrating when I come across a really good job that I would love to see filled by a kababayan but am constantly frustrated by the endless obstacles placed in our path by our own government. When I question our officials all I get told is "we are protecting our citizens from human trafficking..." Unfortunately they are often preventing our citizens from getting good paying jobs since others can deploy an Indian IT tech or an aircraft mechanic much faster than I can bring a Filipino.

Sometimes I can bypass the system by bringing the person on a visit visa instead and then starting the paperwork processing after he or she arrives, but with these rules limiting travel that becomes more difficult. What is a shame is that I find these rules can all be 'bent' if I go through an 'agent' who has a friend in the management of the POEA but who wants to charge 2 months salary to make that happen. That's not small when some of these salaries are $5000 or $6000 a month.


If those observations are not nightmarish yet, here's another government regulation -- requiring OFWs to have mandatory insurance -- that was implemented last year.

A report from The Standard in HK last November 10, 2010, Maids on the shelf as new insurance charges hurt said,

..More than 100 residents have shelved plans to hire helpers, it was claimed yesterday, as a push to revoke a new law on insurance picked up steam... The law, revealed by Manila last week, makes workers carry policies costing US$144 (HK$1,123) to cover a two- year contract, with premiums paid by employers or recruitment agencies.

Coverage includes US$15,000 for death in an accident, US$10,000 for natural death, and US$7,500 in case of permanent disablement. There are about 130,000 Filipino domestic helpers in Hong Kong affected by the law.

"The new measure was hastily adopted by the Philippine government with no transparency," Lau said. "The Philippine officials involved have not considered the responses and feelings of overseas employers."

Under SAR law, about 280,000 employers take out insurance costing about HK$900 every two years. But many employers have voluntarily purchased comprehensive insurance of about HK$800 to HK$1,000 a year to cover medical expenses on top of compulsory labor insurance, Law said....

The same issue was carried in the local media BusinessMirror that same day, HK employers hit law on insurance. It reported,


... The new policy, an amendment to the Migrant Workers Act of 1995, took effect on November 8 and requires employers or agencies to pay $144 as insurance for every worker they hire.

...Deputy Consul General Kira Christianne DaƱganan-Azucena said, “The reaction was significant, so we’re responding by making sure that their sentiments reach the proper authorities in Manila. There are still some things not clear. Their questions is if this mandatory insurance apply to Hong Kong-bound domestic workers, considering the employers have to pay already some kind of insurance for every worker they employ under Hong Kong law. What happens to the worker if terminated? Is the insurance transferable? Can the person who paid the premium get back the money? Details like that.”  

She said while the law explicitly says that workers will not be made to bear the cost of cover, it is not clear if the employer or the recruitment agency should carry the burden of paying premiums.

Azucena said the consulate was not consulted before both houses of Congress passed the law. According to her, what was asked of the post was a certificate noting that Hong Kong has existing labor laws that protect migrant workers.

These new laws and restrictions that were passed with little or no transparency, were likely trigged by cronyism by certain Philippine legislators and POEA officials in the local insurance industry.

Employment, whether local or foreign, is strictly a private contract between an employer and an employee. Government is outside of the picture. Only when one of the parties, employer or employee, breach the contract, then government can come in to enforce the rule of law. Like when the employer does not give the stipulated salary and other benefits, or when an employee has caused physical harm to the employer and his/her family. Government comes in after the breach or non-obedience of contract, not before. Because if government will intervene in each and every employment contract with ever-rising regulations and restrictions, then a hell of bureaucracy is slapped on everyone, including the law-abiding employers and employees.

The usual reason of "protecting our OFWs from human trafficking and abused by foreign employers" is a catch-all alibi to create new restrictions and rackets that are in fact indirect robbery. To require for instance that the employment agency will get one or two months of an OFW's salary on top of other fees for facilitating a private contract between a foreign employer and an OFW is tantamount to robbery sanctioned by the government. And to require another round of work insurance when foreign employers are already required by their own governments to provide insurance for the OFWs that they hire, is simply raising the cost of employment, and reducing the chance of employment by Filipinos who want to try their luck abroad.

See also
Part 3, Remittances and Guest workers, March 25, 2008
Part 4, Filipino entrepreneur in Germany, June 04, 2009
Migration and Freedom 5: Conferences on Liberty and Migration, October 19, 2010
Migration and Freedom 6: Passport and People Mobility, November 30, 2010

Tuesday, April 12, 2011

Welfarism 11: Bureaucratizing Entrepreneurs

The main problem with government-sponsored population control measures like the proposed RH bill is that it starts from the premise of a nanny or welfare state: education is government responsibility, healthcare is government responsibility, housing is government responsibility, credit, public works, justice, traffic, cash transfer, etc. are all government responsibility. So the bigger the population, the bigger the public spending for social and economic services. So to reduce public spending and the high public debt in the future, controlling fast population growth is also government responsibility.

Theoretically, it is possible to have 3 or more kids and be an irresponsible parent. Why? government has feeding program, it has free education from elementary to high school, and cheap/highly subsidized uninversity education, even free if one is a government scholar; there are lots of mass/social housing, there are free medicines, free healthcare for the poor, cash transfer for the poor, agrarian reform for the poor, and so on.

One adverse effect of all these nannyism is the corruption of parental values. Why assume more parental responsibility when there are lots of government responsibility that are already in the laws and are regularly budget every year? So drink and party as often as possible, smoke as many cigarettes as much as possible. If their internal organs get dilapidated, they can run to the state because "health is a right".

Most problems related to high unemployment, high poverty, are caused by government through bureaucratism, high taxation, lots of prohibitions and regulations. Corruption is just an icing on the cake.

Take this report, Doing Business 2011: Philippines produced annually by the WB and IFC. For average companies in the Phlippines: To start a business, it will take 15 procedures (with various government agencies) in 38 working days, costing nearly 30 percent of the per capita income. Take note that the assumption here is zero corruption. If certain bureaucracies will insist on getting bribes, otherwise the waiting period will not just be 38 working days but 2x or 3x that period.


Paying taxes for an average corporation, 47 different taxes and fees per year(!) that will require 196 hours (or 24.5 working days or more than 1 month). Profit tax is 21.3 percent, but when various mandatory or obligatory labor and social security contributions are included, the total tax rate would rise to 45.8 percent of a corporation's profit.

So government creates lots of direct taxation, mandatory contributions (which are indirect taxation) and other forms of regulations and prohibitions (one is prohibited by law to conduct any business unless those regulations are obeyed and followed). When these restrictions and prohibitions are enforced, many people and entrepreneurs will be forced to kneel and bow before certain government officials, pay bribes or what just to hasten a supposedly non-criminal, non-prohibitive action like putting up a small business, or hiring new workers.

(I took this picture of various government permits in a water purifying/distilling shop near our place in Makati). If the poor and the lower middle class want to stand on their own and not depend on government welfare, they put up a vulcanizing shop or barber shop or carinderia or fishball/barbeque stall, the government officially says NO. Unless the trying-hard entrepreneur will first get barangay permit, sanitation permit, garbage collection permit, fire department permit, mayor's business permit, DTI permit, SSS permit, BIR permit, Pag-IBIG permit, etc. Most of the "underground or informal" economy that we see are tolerated by some national government agencies but not by the local govt and local police. That is why "arkabala" and bribes to certain city hall or police officers are practiced.

After succeeding to create lots of poverty and high unemployment, government and its multilateral patrons (the UN, WB, EC, ADB, etc.) would blame high population growth.

Government would rather see the poor begging for more welfare, more subsidies, because the endless welfare programs -- education for the poor, healthcare for the poor, housing for the poor, credit for the poor, cash transfer for the poor, condoms and ligation for the poor, etc. -- will be continued and all the hundreds of billions of pesos of annual budget and new loans (and ever-rising interest payment) to the foreign aid banks will continue.
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See also:
Welfarism 9: Conditional Cash Transfer (CCT), November 12, 2010
Welfarism 10: Spanish Problem, the Euro or the State?, December 01, 2010