Monday, December 31, 2012

Christmas Notes 8: The 12 Days of Christmas

During the Christmas Party of the DLSU Political Science Department faculty members and staff middle oif this month, I sang this during the Karaoke and singing session. My wife teaches at the department. Many if not all faculty members there are pro-RH bill, now a law, so note the 5th day -- satire for me, not a praise :-)

The 12 Days of Christmas

On the __ day of Christmas government said to me:

1st -- More taxes to pay public debt.
2nd -- More borrowings, and 
3rd -- P2 trillion budget...

(So the last part of the song would look like this)

12th -- Fight climate change
11th -- More Congress districts
10th -- Cyber crime law
9th -- More sin taxes
8th -- K-12 for students
7th -- Philhealth for the poor
6th -- CCT the poor
5th -- Viva RH bill
4th -- Condoms for the poor
3rd -- P2 trillion budget
2nd -- More borrowings, and 
1st -- More taxes to pay public debtr

I attended only a few Christmas parties this year, something like six: with Gina L, Ozone A, other friends; the UPSE alumni reunion party,  my sister's auditing firm, DLSU Pol Sci., my rotary club, and my own family on the 24th evening. 

It's good that it has been rather cloudy if not wet on many days of the month.  

Preparing for the new year. Hope it will be better than this year.

CSOs and State 17: UP Pahinungod and Typhoon Victims in Mindanao

The main characteristic of "civil society organizations" (CSOs) is volunteerism. In contrast, the main characteristic of government and the state is coercion. This makes the two rather a substitute, not complement, for each other.  There are several instances where they collaborate with each other, and that's because government agencies, from local to national, are so many that CSOs and other volunteer individuals have to work with them to minimize duplication of certain functions.

Civil society is a state of society where citizens are mature and responsible enough to run their own lives and that of their communities with minimum coercion, restrictions, regulations and prohibitions. So in cases of calamities for instance, solidarity with the affected people and communities is instant and spontaneous. There is volunteerism in almost everywhere, the willingness to help, without being told or being coerced by a strong force under threats of penalties if no one will help, is there.

Below is an account by a physician from UP, during the UP Pahinungod assistance to victims of typhoon Bophia, locally named "Pablo" by PAGASA. A friend from "Taga UP Diliman ka kung" (TUPDKK), Dr. Elaine Nisperos, shared this in my facebook wall. I like the story, hence reposting it here.

On a side note, the Philippines is the only country in the world that gives local names to tropical storms with international names already. Countries in western Pacific including the Philippines contribute two names a year to international storms yet to come, for easier identification. So names that were given by PAGASA can be used internationally and yet when those storms enter the Philippines area of responsibility (PAR), PAGASA ignores these international names and use local names, which I think were names of children of PAGASA officials, or kids of their friends or relatives. Really unnecessary. But I digress...

by Dr. Digie Talens

On the night of December 4, 2012 Davao Oriental and Compostela Valley were ravaged by the strong winds of Super typhoon Pablo. In the darkness, families were awakened as the strong winds carried their roofs, and shook their homes. In some areas, flood waters rose without warning while in others, the wet soil gave way and fell upon people’s homes. Glass breaking, walls collapsing, one can only imagine the horrors as the families groped their way in the wet dark night. Parents used their bodies to shield their children from falling debris as moans and cries from helpless victims are heard through the night. The winds were relentless even as the first light of dawn showed a glimpse of roofs flying, branches falling and homes breaking apart.

Hundreds perished in those few hours. To those left behind, heartache and despair await. 

As news of the devastation reached Manila, my husband, as the director of UP Ugnayan ng Pahinungod (which is Cebuano for “offering”), and chairman of the disaster response of UP Manila, started to mobilize his staff to see how the UP system can extend some help to our countrymen. He is not alone in his altruism. His office was soon deluged with inquiries from the UP Manila Chancellor, UPPGH Director and the UP Padayon Group, as to what they could do to help.

The Ugnayan ng Pahinungod, being the volunteer arm of the UP Manila for various outreach projects (including medical missions), immediately contacted the Local Government Units (LGU) of the affected area. On initial consultation with the Office of the Governor of the Compostela Valley to determine the type of help that UP volunteers can render, nothing specific was determined. To be able to promptly and effectively use the limited resources that the UP System can acquire, a more detailed plan had to be established so, the UP Alumni in Davao were mobilized to give a more accurate view of the situation. Soon, the remote area of San Isidro in Baganga, Davao Oriental was identified.

The task of getting funds for the relief distribution and medical mission did not prove too difficult. On Dec. 6, in a Christmas party of UPCM batch 85, the class decided to donate part of their fund so that UP Pahinungod can immediately set their plans into action. Some batchmates added more money from their own pockets. 

Pledges soon came pouring in from both domestic and foreign sources. The problem was it took too long to convert the pledges to cash. The batch 85 donation was instrumental in bringing relief early to the families in the affected area. 
A team of 3 doctors, an EMT, an information officer and the mission coordinator (also a dentist) from Manila, met up with UPCM alumni in Davao City. The latter facilitated the search for a place for the team to stay, transportation from Davao City to the affected area and coordination with the locals. 

Baganga was allegedly a 6 hour drive from Davao City but with difficult roads, it turned out to be at least 8 hours from the city. As the team travelled to their destination, the devastation revealed itself to them.

Hectares of land, once filled with towering coconut trees that provided a livelihood for the families are reduced to a wasteland of uprooted trees strewn like matchsticks on the ground. Vast banana plantations just recently filled with fruits ready for harvest, are barren now, comically appearing to have had a haircut done by a crazed barber. The beautiful green mountain has been replaced by a big brown mound. 

The road although still passable, is filled with pieces of glass, nails and debris from the houses and buildings destroyed by the storm. Many tires have been ripped by this debris, making access to the municipalities difficult. Along the road, families have made make-shift shelters, with materials gathered from their uninhabitable homes. 

The school, stadium and the municipal center were in shambles. Even large houses were roofless and most were abandoned. According to the locals, those with relatives elsewhere were gone. Only those with no other option were left to rely on the relief goods and help that outsiders can offer. 

The team was housed in a relatively large house owned by a local engineer. They were given two rooms whose roof was spared by the storm. Another volunteer group, Balsa Mindanao, joined them at the house. The latter group was given the living room, dining room, and basement to “camp in” but as rain fell once again on San Isidro, the UP team had to share their space with the Balsa Mindanao group and their soaked belongings.

Ironically, the rain continued but there was not enough usable water. The only source of water was a “sapa” a few minutes away from the house. Bathing was a luxury even the UP team could not afford. 

The UP team, brought with them food and drinking water. They had enough for the few days they would be staying but the supply of food in the area is very limited. They have been briefed by their local contacts and the Balsa Mindanao group to resist the urge to give their food to the (once proud) people now begging for some relief from their hunger. 

In a lot that has been cleared of debris, tables, benches, and tarpaulins attached to wooden posts were set up to form the clinic. Medical supplies were gathered in tables that served as the “pharmacy”. The UP team worked hand in hand with the Balsa Mindanao group. Patients were seen and treated with their families. The air was heavy with the pain of loss but there were smiles as wounds were treated, and food and medicine were distributed. Before dark, 576 patients were seen and treated by 4 doctors, close to 500 families were given relief goods as well as medical advice. Still, this was not enough. 

The families have lost their loved ones, their homes and their source of livelihood. In the midst of this despair, the people need some glimmer of hope. Perhaps when others see their plight, people will reach out to help them. Perhaps, the government will finally get organized and provide them with the basic services that are non-existent at this point. From the initial out pouring of pledges from various sectors, we know that there is no shortage of generosity. If only the donations and relief goods would reach the people that need them the most. 

The Ugnayan ng Pahinungod is planning another relief and medical mission to this area on the second week of January. Volunteers and donations are most welcome.

Saturday, December 29, 2012

Climate Tricks 18: Severe Tropical and Winter Storms as Proof of AGW

Two days ago, I posted this blog article from NTZ in my fb wall, and I noted that while there are storms in the Philippines and other parts of the tropics, there was white Christmas in many parts of the US and Euurope, and now a deep chill in continental Asia, down to -57 C in Siberia. These are indeed "proof of intensifying man-made global warming."

Then there are more related news reports and stories.

Terrible case of global warming slammed India too. Delhi's temperature dropped to 7C, and in Rajasthan, down to 3.8 C. Could be due to more people, more cars and buses, more malls and houses, more coal power plants, that contributed to this global warming, India version. See

In the US, they have some interesting stories there.

From WUWT,  61.4 percent of the US covered by snow this week, vs only 18.6 percent last month. Way back in 2000, a senior researcher from the Climate Research Unit (CRU) in UK said that "snow  would be a rare view in the future".

And another heavy winterstorm this week,

In Europe... temperatures in Russia were 10 to 15 C colder than average, 83 deaths in Ukraine, 49 in Poland in just one day,

Friday, December 28, 2012

Business 360 2: Free market means free individuals

* This is the paper that I submitted to Business 360 for its second issue, published early this month in Kathmandu, Nepal. The publisher, Ms. Charu Chadha, is a good friend of mine.

Free market means free individuals

Nothing in the world would attract people’s passion and attention more than individual freedom. The freedom to explore their surroundings, communities and countries; the freedom to read and express their ideas and observations. The freedom to raise a family and interact peacefully with friends and strangers. The freedom to pursue an artistic or sports or entrepreneurial activity. Or even the freedom to bum around and be lazy.

So there is great misconception when people would object to free market, fearing that markets are ruled only by giant players and corporations, of monopolists and oligopolists who have connivance with government regulators and bureaucracies. Far from it.

All markets are made of people, rich and poor, young and old, men and women, sellers and buyers, producers and consumers. Whether we talk of the labor market, capital market, housing and education market, food and healthcare market, there are producers and consumers. So when we say free market, it simply means free individuals.

The pursuit of individual freedom is an end in itself. People have the freedom to be industrious and responsible, or the freedom to be lazy and irresponsible. The freedom to be efficient and excel, or the freedom to be lousy and mediocre. Hence, people should be allowed to do what they want, including what to do with their own body, provided that they do not prevent other people from pursuing their own liberty by inflicting or threatening physical harm and violence.

The imposition of external coercion and prohibition should be kept to the minimum.  People cannot avoid coercion as it is a matter of degree. Parents coercing their children to turn off the tv and do their school assignment may look undesirable for the kids, but it is within the rights and power of parents exercising their parental freedom and responsibility for their family.

When government prohibits killing and murder, shooting and stabbing, stealing and land grabbing, rape and kidnapping, and uses its armed and coercive powers to implement this type of prohibitions, then it is expanding individual freedom as the productive and efficient people can do their work in peace.

It is the imposition of various other regulations, restrictions and prohibitions by government that ultimately limits if not kills individual freedom. If people are prohibited from starting a food or bakery shop, a beauty parlor or computer shop, unless they get various permits and certificates from different government bureaucracies first, pay various taxes and fees first, then such coercion is limiting individual freedom. Or if people are scared of honestly speaking their minds about the affairs of government and society, otherwise they might land in jails or be executed, then such coercion is limiting or killing individual freedom.

The main function, the raison d’ etre, the reason for existence, of government is to promulgate  the rule of law, the law against various crimes and aggression, and to protect private property rights and the citizens’ right to self expression. All other functions like running banks and hotels, casino and lottery, tertiary hospitals and universities, are either secondary or unnecessary.  Of what use to a person that he gets free or highly subsidized education, healthcare, housing and other services for his family, if the fruits of his labor and hard work can easily be stolen and taken away by bullies, either from the private or government sector? Or his kids can be abducted or murdered easily and justice is too far out to be rendered?

People should assume more responsibility in running their own lives, their households and their communities. Having solidarity and compassion with the less fortunate people, the victims of calamities and accidents, does not need legislation and coercion. It is within human nature and rationality, directly or indirectly, that such solidarity and charity can happen naturally and spontaneously.

By assuming more personal, parental and civil society responsibility in running their own lives, people can rightly assert that their income and savings are theirs and theirs alone. Taxation will be retained to finance a limited and lean government that is focused on doing its basic function as outlined above. One or two consumption-based taxation should be sufficient to finance government.

Where there is more responsibility, there is more freedom. The great Austrian economist and legal philosopher Friedrich Hayek advised that “Freedom and responsibility are inseparable. People who are afraid of responsibility are afraid of freedom itself.”

See also:
Busiiness 360 1: Nepal and the Philippines, November 26, 2012
Fat-Free Econ 33: Institutions and Why Governments Fail, December 09, 2012
Lion Rock 4: Leftism and Populism by Intellectuals, November 05, 2012
Pol. Ideology 38: Central Planning vs. Free Market, October 30, 2012

Wednesday, December 26, 2012

Lion Rock 5: Free Will vs. Power Over Others

It's nearly two months now since the Lion Rock Institute (LRI) "Reading Salon 2012" in Hong Kong was over, there is still some sort of discussion "hang over" from some of us participants. The other day, discussion moderator Simon Lee of LRI sent us a message, below. I borrowed the title "Free will vs. power over others" from Simon's message.

After the conference, I further meditated on the subject on the future of the ideological battle, with all the insights shared by you.

The ideological battle has been fought since time immemorial.  I see it as a battle between free will and power over others.  On the one hand, it is the trust and respect of other as individuals with free will.  And on the other, it is our innermost urge to control and harness the power of the collective mass for a predictable and hopefully better outcomes.

The battle lines advance and retreat.  In the first half of the twentieth century, the ideological battle was about totalitarian, corporatist, central planning experiment versus free enterprise.  At the end of the day, objective reality rules.  The system produces more and more efficiently prevails.

After the two world wars, there is a new movement.  A kind of mutation.  Some fractions of the believers of collective powers abandoned their wish to take over the state apparatus.  These believers of collective powers are more pragmatic than they seem.  If they can take over the control over the means of production bypassing the state, they should.  I am not saying they do not rely on the coercive power of the state, but they go beyond simply using legislation and state bureaucracy to achieve their goals.

Who are these mutated new left?  What are their strategies?  Alinsky captures the essence of the action of the new left while Hayden drew the blue print.  

The new left takes actions toward corporation without real clear agenda but to gather the crowd.  After successive assaults sometimes they find the sore points.  This is the Alinsky model simplified.

Tom Hayden laid down the plan to take over the commanding heights of the new morality: media, higher education, and other institutions of the new left movement.  Look at the campuses, and the rent seekers of the so called CSR industry.  The new left has taken a stronghold in these institutions.  They have been defining the new ideological battle and leveraging the resources from free enterpries to propagate their agenda.

There are new left around us and they do not even realise that they are under the spell of the propaganda.  Wordcrafts in our system are inevitably under the spell - HR, PR and CSR so I call the unholy trinity of corporate suicidal impulses.  One of the most important and urgent tasks is to define clearly the functions of these business operations, so businesses can focus on contributing by creating values instead of conforming to the faux-morality put forward by the new left.

Another major battle ahead of us is to counterforce the propaganda coming from both the higher education rent seekers and the media-entertainment industry.  Fortunately, the internet has provided a near ideal platform which is by definition free from bias except of the audience's own.  The question is whether campaigners of our side of the ideological battle are equipped with the right skills and techniques.  Their advantage is quite obvious: they have wordcrafts and discouraged artists.  But what do we have?  Yes, we have entrepreneurs!  I always see the lights of hope.

-- Simon

I like Simon's reflections above. It's a big challenge for us who believe in more individual freedom, more personal responsibility, how the other and much bigger camp, can impose their will on the rest of us. While we believe in voluntary collectivism and diversity, the other camp wants forced collectivism and forced equality, they dislike high diversity and spontaneity among people. That is why they create volumes upon volumes of regulations and restrictions, to "flatten" out the outliers like the super-efficient and super rich on one hand, and the super-inefficient and super lazy among the people.

Below, after dinner food and drinks of Day 1, also hosted by LRI in the same venue, Harbour Plaza Resort Hotel, at the Northern territories. Barun Mitra of the Liberty Institute in Delhi replied to Simon's message, below.

The Reading Salon is still alive in my mind. I particularly liked the structure that allowed us to integrate theory and history, to current affairs. My one suggestion would be to have a shorter reading list in future, so that most participants would be able to do the reading before the Salon.

One quick thought on the eternal battle between individual freedom, and collective control. The divide is not always very clear, and sections of the lines may be in flux. For instance, at the moment we are trying to work on the issue of land rights of rural poor. And in that we are trying to approach some on the far left to join our alliance. Particularly, those who may have discarded their ideological aversion to private property. For the past few months I have been going around India speaking about property / land rights of the poor, and meeting quite a few people from the Left who are surprised at my formulation. And a few of them may align with us on this issue. I think we should always look out for tactical alliance!

-- Barun

Barun is an engineer by academic training who shifted career to promoting liberty and freedom for about  two decades now. His insights above somehow shows his engineering training, finding innovative solutions to old problems. Most free marketers would give up reaching out to the far left because of their deep hatred of the free market, of capitalism and the profit system, of private property ownership, but Barun is able to reach out to some guys in the far left in India. Fantastic mind.

Below, after the drinks at the restaurant which closed at past 10pm, we continued the discourse at Barun's room in the hotel, we ended past 12 midnight :-)  Simon is 3rd from right in the upper photo, beside him is Barun. LRI Executive Director Peter Wong is beside me.

On Simon's points, I agree that many civil society organizations (CSOs) have been drastically and generally co-opted by the state. I have been using Andrew Work's term a few times, from NGOs to GFOs or government-funded organizations. Or simply lovers of more government regulations, welfarism and endless subsidies.

One example I can cite, is the recent debate on the Reproductive Health (RH) bill which will soon become a law. This is clearly government-sponsored and taxpayers-funded  population control but the RH camp would never admit it as population control but only "expanding choices" for couples.

Majority of the NGOs, academics, media, other CSOs especially in the health sector, have supported that bill. The main opponent to that bill was the Catholic Church. But there are other smaller camps who opposed that bill other than the religious argument, and these are the small free market groups here including MG Thinkers, the libertarian anarchists, the Ayn Rand/Objectivist group. The main basis of our opposition is that we do not believe that people are liabilities, that multiple government coercion, prohibitions and taxation, along with government failure to promulgate the rule of law, are the real liabilities in society.

On Barun's suggestion to limit the reading list. I support that. In 2005, Atlas sponsored a similar reading salon in Phuket, and we discussed only one book, Friedrich Hayek's "The Constitution of Liberty", several chapters. That reading-discussion was very helpful for me, it deepened my understanding about individual liberty and the rule of law, as opposed to the rule of men.

I wish to see LRI continuing the Reading Salon in the coming months and years. Not necessarily involving me  always as there are other bright young minds in the Philippines and Asia who should be given the opportunity to participate in this exercise. 

Thursday, December 20, 2012

Drug Innovation 8: Treating Men's Cancer

My elder brother died of prostate C a few years ago, then my mother's first cousin in Cebu. Nationwide, prostate C I think is among the killer diseases for men. My HMO or private health insurance told me once to undergo a test of prostate C as it might be hereditary in our family but I have done it yet. 

Today, there is a news report from on men's cancer, that by 2027, the Cancer Research UK foresees that one-half of our gender worldwide will have one form of cancer developing in our body. Not a scary thought for me actually because I will be in the mid 60s by that time. But then any cancer cell can multiply anytime in one's body as one ages and as one's immune system gets weaker.

Here's portion of that news report:

LONDON - A man's lifetime risk of developing cancer is set to reach one in two by 2027, according to new figures released by the Cancer Research UK on Wednesday.

This prediction means that within 15 years 50 men out of every 100 are likely to be diagnosed with cancer at some point in their lifetime as opposed to 44 out of every 100 in 2010.

The research body predicted that women's lifetime cancer risk is also increasing and is predicted to rise from 40 to 44 out of every 100 women by 2027.

But it is still optimistic about cancer surviving thanks to better techniques.

"Cancer survival has doubled in the last 40 years thanks to research developing better techniques to detect the disease and improved treatments to increase survival," it said.

"So while the risk of being diagnosed with cancer is rising, the overall chance of surviving it is improving."

It held that age is the biggest risk factor for cancer and the increase in risk is largely due to more people living longer. As our lifespan increases more people will reach an age when they are more likely to be diagnosed with cancer....

Thanks to modern medicine and the life sciences. Human understanding of various diseases keeps improving. Understanding of a disease, how it starts and how it expands, is a prerequisite to developing a treatment, both in lifestyle change and in medication.

In an article this year in BusinessWorld, Medicines in Development for Cancer, Reiner Gloor of PHAP wrote,

Meanwhile, more than 30% of cancer could be prevented through healthy lifestyle, which includes non-tobacco use, a healthy diet, being physically active and moderate use of alcohol. Furthermore, the chances of beating cancer become higher each day with early detection, vaccination and a steady stream of innovative medicines.

The solid commitment to patients and the advancement of science are at the core of the sustained progress in the fight against cancer. Biopharmaceutical researchers are now developing 981 medicines for all cancer types. Many are high-tech weapons to fight the disease, while some involve innovative research into using existing medicines in new ways, announced the Pharmaceutical Research Manufacturers of America (PhRMA).

In its 2012 Report on Medicines in Development for Cancer, PhRMA revealed that several cutting-edge approaches are being employed in search for better treatments for cancer.

The report said that medicines in the pipeline include a drug that interferes with the metabolism of cancer cells by depriving them of the energy provided by glucose. Also in development is a medicine for acute myeloid leukemia (AML) that inhibits cancer cells with a mutation found in about a third of AML sufferers. The list likewise includes a therapy that uses nanotechnology to target the delivery of medicines to cancer cells, potentially overcoming some limitations of existing treatments, said the report.

In a bid to address major types of cancer, the report said that there are 121 medicines in development for lung, lymphoma (117), breast (111), colorectal (66), ovarian (63), and stomach (23) cancers among others. In addition, there are 94 medicines and vaccines in the pipeline for prostate cancer. Meanwhile, "orphan drugs" are being developed for rare cancer types that affect less than 200,000 people.

Researchers are also working on treatments for cancer types that affect children. There are medicines in development for brain cancer affecting the young for neuroblastoma, glioma, and glioblastoma.

Many of these candidate drugs have entered clinical trial, or the phase in research and development (R&D) that perform human testing involving up to 5,000 individuals to establish the safety and efficacy of the medicines.

Meanwhile, some medicines in development for leukemia have been granted fast track status or are considered orphan drugs.

Healthy lifestyle like avoiding excessive use of alcohol, tobacco, fatty food and drinks, having a more active rather than sedentary life, is still the best and cheapest defence in preventive healthcare. But should cancer cells or other diseases come in, the use of modern medicines should be tapped whenever possible. 

It is important that public policies and government regulations that tend to inhibit or discourage more medicine innovation, more innovative healthcare schemes under a competitive environment, should be avoided. There is money in healthcare, the same way that there is money in education and housing, in food manufacturing, hotels and restaurants, IT and telecomms, and there is even huge money in politics and excessive government spending. Different players in the pharmaceutical, biotechnology, molecular biology and other life sciences will come in when their risk-taking and health innovation will be properly rewarded, not demonized by politics and heavy government regulations like IPR busting and price control.

Fat-Free Econ 34: Rise in Unemployment Rate Not Exactly Bad

* This is my article yesterday in TV5's news portal,
The National Statistics Office (NSO) released the October 2012 quarterly labor force survey (LFS) results, the last for this year.  What was highlighted was the increase in unemployment rate from 6.4 percent in October 2011 to 6.8 percent this year.

This did not conform with the high economic growth in the third quarter, when the Philippines' gross domestic product (GDP) grew a surprising 7.1 percent, the second highest in Asia. If growth was high, it means that there were lots of economic activities that occurred over the last quarter and hence, more jobs must have been created, whether temporary or permanent. So what went wrong?

In the table below are the numbers over the past three years. We show both the actual numbers and percentages. Take note that in the fifth column, the increase or decrease in absolute numbers from October 2011 to October 2012.

Source: NSO,

Here are the notable points:

a) There were 1.08 million new Filipinos who entered the labor force, whether looking for work, already working, or still studying.

b) Labor force participation though has declined by 0.76 million, meaning less people are actually working or are seeking work, or more people have retooled themselves by going back to school and postponed entering the labor force. The significant decline in labor force participation rate from 66.3 percent to 63.9 percent also shows this.

c) Employed people - whether employers, employees, self-employed or unpaid - declined by 0.88 million.  And whether fully employed or underemployed, which is a bit worrying.

d) Underemployed people also declined by 0.22 million, which implies that the fully employed people declined by 0.66 million.

e) Unemployed people increased by 0.12 million. We will have a longer discussion of the term “unemployed” below.

f) Unemployed and underemployed combined declined by 0.1 million people.

From a layman’s perspective, points (b), (c) and (e) are bad news, while points (a), (d) and (f) are good news. 

We now compare this year’s numbers with those two years ago: (a) employment rate is higher, (b) underemployment rate is lower, and (c) unemployment rate is lower. This means the labor force data are better this year compared to two years ago, but mixed compared to last year.

The NSO has defined the unemployed people as: “persons who are 15 years and over as of their last birthday and are reported as: (1) without work and currently available for work and seeking work; or (2) without work and currently available for work but not seeking work for the following reasons: ( a) Tired/believed no work available, (b)  Awaiting results of previous job application, (c) Temporary illness/disability, (d) Bad weather, (e) Waiting for rehire/job recall.”

This does not easily conform with the layman definition of an unemployed as someone who is “seeking work but is not hired”, as the above definition includes people who are “not seeking work” because of the five reasons given. Which means that many of the unemployed are people who generally have chosen to be unemployed temporarily. Someone who is offered to work at say, P30,000 per month gross pay has chosen to be unemployed temporarily because he is awaiting possible employment in another company that will give him P40,000 or higher per month in gross pay.

In this case, to be “unemployed” is not exactly a bad situation. It is “unemployment by choice” and not due to structural problems in the economy.

It is highly probable that many Filipinos have opted to be unemployed temporarily, say at the time the survey was conducted because they were awaiting job placement or hiring abroad. They want to be ready to leave any day without the hassle of seeking management permission to resign, get office clearance and related burdens.

The figures for OFW remittances seem to conform with this hypothesis: $19.24 billion in 2009, $20.74 billion in 2010, $22.35 billion in 2011, and projected to reach $24-plus billion this year. There is  generally higher pay abroad than here, despite the continued appreciation of the peso relative to the US dollar and other major currencies.

In short, a higher “reservation wage” abroad or here - as a result of anticipated faster economic growth and more business activities - is among the reasons why many Filipinos have opted to be temporarily unemployed. An increase in unemployment rate from 6.4 to 6.8 percent does not appear to be bad after all.

See also:
Fat-Free Econ 30: BPOs and Obama, November 14, 2012