Standard and Poors rating upgrade

To everyone bristling over SP saying we need more taxes: Relax.

They said that not as a commandment but merely a statement of opinion. They have standards as to the economic characteristics of an investment grade borrower. They think one way we could meet the standard is to raise taxes and increase the tax base.

We definitely need to improve our tax effort. We know why but the political will is not there. I think it would be more productive to focus on this aspect despite the difficulty. The poor collection performance is a disorder in the system. I'd rather have order there than have new taxes. It's like putting more gas into an engine that needs a tune up. It would be better if the engine were maintained than to keep wasting gas.

CC: Economy Update 1

I started checking on point one: the economy grew over 10 years. Apparently, the figures being referenced were GDP figures. I started to dig and wrote down GDP for Erap, P-noy and GMA. There definitely was a big improvement during GMA's term.

The main question is, where did the economic growth come from? At first I suspected OFW Remittances and Business Process Outsourcing. In pursuit of more data I visited the NSCB site. This is what greeted me:

I almost fell of my chair. P-noy's economic performance is being hampered because he's not spending as much as the previous administration. I'll dispense with the economic debate over pump priming, Keynesian vs monetarist and what not. Here's the point. Government services is recorded when the funds are spent. P-noy is spending less than Gloria. Gloria disbursed more funds out of the national coffers.

Now, how effective was that spending?

Right. I don't know either.

What I do know is that P-noy is cutting cots by using a zero budgeting program. Redundant and ineffective projects are being denied funds. We can suspect there's politics involved, that P-noy is punishing his political adversaries, but that just makes the follow-up question all the more pointed. Does it mean he is spending less on his political allies than Gloria?

So even if GDP did grow, so long as it came from government spending we will always ask if the money was used wisely. The next step would be a check on all the projects done during GMA's term. Did those projects push through and were there any snags? I think I have to leave that path for now maybe until I get my broad answers for the rest of the points.

note: I'm using the acronym CC: Economy for this challenge. Here's my first post for the Citizen's Challenge: Economy

Children's Parties may cause Hearing Loss

Ever wonder how loud those children's parties are? I remember countless times I've attended one where the PA system's volume was set so high you couldn't have a conversation. That's dangerous. And yes I'm talking about you McDonalds, Jolibee, KFC and Shakeys. And it's not just restaurants. Other retailers can be guilty of this too.

Here's some info from Dangerous Decibels

• A typical conversation occurs at 60 dB – not loud enough to cause damage.

• A bulldozer that is idling (note that this is idling, not actively bulldozing) is loud enough at 85 dB that it can cause permanent damage after only 1 work day (8 hours).

• When listening to music on earphones at a standard volume level 5, the sound generated reaches a level of 100 dB, loud enough to cause permanent damage after just 15 minutes per day!

• A clap of thunder from a nearby storm (120 dB) or a gunshot (140-190 dB, depending on weapon), can both cause immediate damage.

Prolonged exposure to loud noises can cause Noise Induced Hearing Loss or NIHL. If I find that personal conversation is drowned out by the music or the announcer's voice I ask that they turn down the volume. It's obviously above 60 dB and I don't want  to risk it being at 85 dB. Aside from me there are children in the room. Their ears, especially those of babies, are not as developed as adult ears. I don't want to be responsible for their hearing loss.

And now I have an idea of why service is sometimes poor in this country and why people keep asking you to repeat yourself. Maybe people just don't hear to well.

References:
http://www.dangerousdecibels.org/education/information-center/noise-induced-hearing-loss/
http://www.sciencedaily.com/videos/2008/0304-dangerous_decibels.htm
http://www.gcaudio.com/resources/howtos/loudness.html
http://actrav.itcilo.org/actrav-english/telearn/osh/noise/noiseat.htm

Water Hyacinth and Floods

The rains provided the water, the Water Hyacinths provided the flooding. Some waterways in Cotabato were clogged with the aquatic  plant preventing proper flow. The waterways swelled and flooded the city. Amidst televised stories of woe and political recriminations was a backdrop of people laboriously dragging plants out of the rivers.

Like past flooding, quite a bit of this disaster seems to be man made. Although water hyacinth is a prolific invasive species, it grows better when fed. Sources say waste from human activity provides ample fertilizer for their growth. Also, they don't grow overnight, which means this problem had been building up over some time.

Citizen's Challenge: Economy

He said, She said
The camps of President Aquino and Gloria Arroyo have been trading barbs these past days. The most recent exchange focused on claims of a decline in economic strength. The Gloria camp point to these economic data:

• 10 years of uninterrupted growth despite a global recession. 7.9% growth rate at peak. 
• Low inflation
• a recent rise in self rated poverty in opinion surveys
• foreign investments down by half according to NEDA

(For now, I will ignore the claims about automated elections because it's not directly connected to economics.Perhaps another time we should check on the claims automation drastically helps the elections)

Here's the Challenge

Can an average person actually verify this using only publicly accessible information especially information over the internet? Can we actually get enough data to form the basis for analyzing the economic strength of the country then and now? This means no exemplary effort to gather the data. No calling up buddies in NEDA. No hiring researchers. Definitely no playing golf with BSP personnel!

The point is to see how much access to crucial information is available to the common pinoy. Freedom of information is an important element of democracy. It empowers citizens, allowing them to bring anomalies and errors to light.

The analysis and conclusions may not be as important as going through the process of research.

Batanes Pine Wine

The Batanes Pine or Batanes Tree is an ubiquitous sight in that province. It grows anywhere and people there are fond of it. What we did not know was that the fruits of the Batanes Pine or Arius can be made into wine. Dr. Roger G. Baltazar of the Batanes State College and his research team have been developing products such as wine, jam, jellies and pastilles from the fruit. Prior to this discovery the fruits were left to drop and litter the ground.

I certainly hope the research yields considerable returns to the people involved. I've long suspected that we have a wealth of untapped resources that remain ignored or underutilized. The reason is that we simply don't know what they can be used for.

It's ironic that unemployment and malnutrition are a problem when we can alleviate both by doing agricultural research and then commercializing the discoveries. It's also equally important that such information be available. As an aside, maybe we should enhance the research skills of our populace so they know how to look for said information. Get all the ingredients together and you can make a dish, otherwise it's just odds and ends on the kitchen table.

Don't Just Modernize the Military

Over the past few day's there have been calls to modernize, to upgrade our defense capabilities so we can attain more security. All the talk may be an illusion as dangerous as having no armed force.

Modernizing per se is not the magic amulet that saves us all. Just for illustration, lets say we modernized and got 10 state of the art tanks. Lets say we come up against an  enemy that had 100 state of the art tanks. Who has the advantage? Numerically that would be the side with 100 tanks. At times though it's the side that knows how to use the stuff they have that prevails.

How to conquer the world

During the 1940s Japan conquered its Asian neighbors to fuel its desire to become an imperialist power. Even the casual students of world history know the end result of that. Japan was nuked. The country suffered under horrid conditions until it managed to recover 20 years later. Then in another 20 years it was set to conquer the world again via finance. Again people feared the loss of property and assets to a foreign power. Then its economy unraveled thanks to unconventional banking practices, collapsing asset prices and the Asian Crisis.

Despite all this Japan still managed to conquer the  world. Back in the 90s anime started landing on foreign shores. This cultural export captured the imagination of many people. There were others, technological marvels that they shared with the rest of the world. Interest in Japanese culture increased. Subsequent sympathy for Japan increased as well. Now when disaster strikes, people band together to help Japan. Even those it warred against. What they couldn't get by taking they got by giving. 

For aspiring conquerors, it's an easy lesson. Transmit culture. Give away part of your identity. Be inclusive because that builds sympathy and rapport. There is nothing more binding than a shared identity. Or to be more flippant: make anime not war.

Cerebral Farming

Bodybuilding is a very physical activity. But even that requires some study and skill. You don't just start heaving barbells around without preparation. That's a sure recipe for injury.

Farming, despite the manual labor involved, also benefits from brain power. A skilled and knowledgeable farmer will perform better than one who just relies on brute force. If you don't believe me then try planting without doing research on what you're putting in the ground. You might get by if you plant malunggay but the chances of thriving are slim.

Encouraging Farming: Microbusiness Perspective

Conventional wisdom says the Filipino is allergic to farming. One article claims that only 3 out of 100 agriculture graduates return to the farm. Others prefer a white collar job as researcher, consultant, teacher or government bureaucrat.

I think there is some degree of romanticizing involved whenever we think of the situation. I'd imagine people decrying the loss of a tradition. People often use the farmer as the epitome of hard work and perhaps some people think other forms of work are not as noble as manual labor. Perhaps people complain of the softening of the Filipino for favoring more cerebral work.

Independence Day 2011

If there's one thing I don't like about Independence Day it's that I keep thinking of all the things that still need to be done!

Fact is we're in this hole. Whether it's because of us or someone else doesn't really matter as much as what  we are doing about the problem. We don't even need to compare ourselves to other countries. Let's just compare ourselves to what the nation was like yesterday then figure out where we want to be tomorrow. Then lets just go there.

This would also be a nice time to have a platform even if it's just a personal platform. It makes comparing the goal and the reality much easier. Perhaps what I'll be doing is revising my personal platform to incorporate any new learnings or adjusting for altered conditions. I'll think of it as my Independence Day ritual.

Jeepneys are Unsustainable

A recent World Bank report concluded that the Jeepney was an unsustainable transport solution for Cebu. I'd like to read a copy of that report. I suspect the same judgement applies to other cities as well. We all have a first hand experience with the effect of jeeps on the road. The constant weaving, slowing and stopping hinders traffic flow. When traffic density is low the effect can be ignored. At higher densities, the effects tend to compound.

The question then is: what do we do with the Jeep. Should we keep it around and suffer the consequences? Do we get rid of it and lose a part of our culture?

Solar Energy Kit from Lopez Company

Lopez owned Lopez First Philec Solar Solutions (FPSS) will be launching a solar energy kit by the end of the year. It will offer 3 versions: off-grid and grid tied 1kw systems and a larger 10kw off-grid system.  The company claims the 1 kw kits can generate about 4-5 kw of electricity in a day effectively replacing 15% of household consumption. The kits start at P300-350,000.

Is it worthwhile to get this system? Lets do the math:

P300,000 cost
4 kw per day
operational 300 days a year
kit lasts 20 years

(cost / years)/(kw per day*number of days operational)
(300000/20)/(4*300)
=P12.5/kw

Compare P12.5 with the cost on your energy bill. It may be higher or lower depending on where you live. Take note that also includes the weather in your area. Places prone to storms and rain will likely generate less solar energy. Just adjust the figures based on your own conditions.


references:
http://www.gmanews.tv/story/222373/technology/lopez-group-launches-home-solar-energy-kits
http://business.inquirer.net/3126/lopez-company-brings-solar-power-to-homes

DOT's Domestic Tourism Campaign Logo

And Here it is!

Fortunately for us, this is for the domestic tourism campaign. That means the use of colloquial Pilipino is only appropriate, in fact it's downright necessary for certain market segments.

What I can't wrap my head around is the design. Domestic campaign or otherwise, this design is not that appealing. Check the comments under the Yahoo article. A number of our countrymen find it too juvenile. A couple of people called it dated, appropriate for the 80s. According to some online papers this is supposed to be from Perceptions, Inc. which is, according to Perception's website:

Bus Rapid Transit 2

The BRT may be coming to the Philippines sooner than we think. In September 2010, the government of Cebu said they planned to undertake a BRT project with the help of the World Bank. In November 2010 Ayala Land announced a planned redevelopment of Makati which includes the implementation of a BRT system. Studies on the BRT have been around since 2005 and as far back as 2007, there have been talks about implementing such a transport solution in the country.

The Bus Rapid Transit System as a Traffic Solution

I think a lot of columnists bought a copy of Newsweek's Royal Wedding Commemorative. At the back of that issue is a mention of the bus-based rapid transit system. The BRT is similar in concept to train based systems in that both are mass transport systems with their own dedicated route and space.

White Space for Water Ways

I encountered the term white space after reading Malcolm Gladwell's Blink. White Space is a security concept that essentially means room for action. White Space is any condition that allows a person more time to react to a situation. White Space thus includes keeping crowds away from VIPs or cops standing behind a stopped driver instead of beside the driver-side window.

This concept should be included in our design paradigms for managing public spaces. Part of our enforcement problem is the lack of space to detect and deter wrongdoing. Poorly lit areas and twisty alleyways provide cover for criminals. A lack of convenient pedestrian walkways encourage jaywalking. Residences directly abutting streams and rivers encourage pollution.

GSIS goes local

GSIS has PHP32 B in offshore investments. They have recently announced plans to move those funds to local vehicles paying special attention to companies in priority sectors. The setors mentioned included energy, power, telecoms, retail. I'm not exactly sure what they mean by the consumer sector but that's included as well. If they mean consumer goods like food, beverages and clothing it means the GISIS is looking at nearly everything.

I'd like to assume that the GSIS will choose investments prudently instead of engaging in a misguided show of nationalism.

Fight vs Malnutrition

I find it apalling that the incidence of malnutrition in this country should be so high. We have several local plants containing numerous nutrients that it should be easy to gain access to them.

Take the malunggay. This plant grows well in the country, tolerating most local soil and weather conditions. It propagates quickly. It packs a lot of vitamins and minerals in its leaves and fruits. A whole tree can grow from one branch. Cut branches quickly regenerate. We had a few trees in our garden and we tried to incorporate it into our diet. Despite the frequent cuttings, the tree still grew too fast. Eventually we had to cut them down to size or the top branches would be too high to reach. Within a few days, new shoots emerged from the cut trunk.

Politicians without Pork

This is a list of Politicians who did not avail of their discretionary funds aka the pork barrel. I am writing this down for posterity. The article came from the Phiilippine Star 7 May 2010. Just in case it becomes an issue in the future we can have a reference as to how some people behaved when they were in power.

In total these people gave up P1.6Bn

Criminals In Plain Sight

Three members of the nefarious Abbu Sayyaf  were arrested recently. What's shocking is the circumstances of the arrests. One of them was working as a security officer in at a high end condo Taguig. I can assume that would be somewhwere in Fort Bonifacio: global city. You know, that city being touted as the next CBD. The same one where the International School is located..

The other one was equally interesting. He was on a date at a mall. It was a pretty large mall too - Robinsons Mall in Manila. there werer further reports he even owned a money changing business.

The last one was competing in a motocross competition in Isabela.

Live Sharks Are Worth More

Palau declared its terrotorial waters as a shark sanctuary and for good reason. The Australian Institute of Marine Science and the Uniiversity of Western Australia estimates that one thrasher shark is worth $2m throughout its lifetime. That's tourist revenue  for the country of Palau. (National Geographic Article)

That's a huge tourist draw. Plus the shark is a self generating resource so long as we let them breed. It's like people visiting a tree in your back yard and generating two million dollars over 20 or so years. And they make more of themselves!

I want to spread the word because we have similar resources, the most well known being the Donsol Whale Sharks. That resource needs to be protected from ignorance and greed:

Osama bin Laden dead

Last night I got word that US forces killed Osama bin Laden. We watched the televised speech given by US President Obama and the resulting reaction. Crowds gathered along Pennsylvania Avenue and Ground Zero to celebrate. Details trickled in but we decided to skip them, opting to hear more concise reports later in the week.

Hopefully, all that jubilation won't blind people to the fact that very violent groups continue to organize and will continue to find ways to disrupt our lives. In short, bin Laden's death is not the end of the problem. Other people may take his place in al qaeda. Other will create their own groups.

Obviously we can't get at the roots of all the things which incite these people. However, we should pay attention to those that we can get to. Political and economic problems are the root of the insurgencies in this country. Just because insurgents have a different point of view does not mean their complaints are invalid. If those are addressed and they still insist on violence then it should be obvious their goals lie elsewhere.

Budget Deficit down 80%

This is significant. Past performance had us believing that the deficit was an unkillable beast. We rejoiced at improvements of 10% to 20%. While some PHP10.0 billion is substantial it's a far cry from 80 billion pesos. Lets check that again: 80 is greater than 10.

Considering the performance, I wonder how the P-Noy team managed when other administrations did not. Some point to the increase in revenues from the BIR, but that's about 1 billion in improvement leaving 79 billion to account for. Customs seems to account for a similar amount. Could it have been the zero based budget policy?

Simply put, zero based budgeting means all budget items get reviewed not just incremental increases. Programs that did not deliver had their funding cut. Check the Wikipedia definition of zero based budgeting. It may seem minor but I suspect it has a psychological impact. Program proponents must show results thus encouraging them to become efficient or at least effective. Corruption has a diminished impact. Even the corrupt have a  reason to serve well - if they don't they lose their kickbacks. 

It would be useful if we could see where the deficit improvements came from. Then we can concentrate on these targets. Citing another efficiency theory, the Pareto Principle, most results come from only a fraction of our activities. This is sometimes called the 80/20 Principle. Studying the recent results could be a gold mine of efficiency information. It may be one of the few chances we'll get in a long while.

Porsches and Champagne

P-Noy keeps getting flak because of his penchant for fast cars. Everyone's favorite is, of course, the Porsche. It;s pretty obvious why. The Porsche is iconic; everyone knows what it is and that it is expensive. It makes a great target.

Reconsideriing the subject, I realized that letting the president have one isn't as bad as it sounds. Don't believe me? Then get ready for a ride.

First off, P-Noy's Porsche was bought with his own money. He's rich and so is the family try as he might to hide that. Next, that Porsche was bought second hand from a local. Assuming the papers are in order some taxes and fees would have been paid to bring it over. That's money for the country. The people handling its transportation get paid as well. That's employment. Some of the maintenance would likely be done here as well. I'm sure they wouldn't ship that car overseas for an oil change and a tank of gas. I can add that local spending has a multiplier effect on the economy especially when that money gets invested locally.

Compare that to the president having dinner in the US. The money spent would have come from taxes. That tax money does not return to the country unless the restaurant sources a lot of ingredients from the Philippines. Last, I checked though, we don't produce French wine. If the restaurant staff were mostly Filipinos maybe some of them would have sent money home.

So the Porsche doesn't sound so bad. We just need to make sure the president and his allies don't eat out too much.

Nuclear Energy in the Philippines

Proponents of nuclear energy say the power source could save us from high energy prices. It produces the most energy for the fixed and variable costs and requires less land to put up. Detractors fear a nuclear meltdown thanks to incompetence and inefficiency thanks to corruption.

Senator Miriam Santiago wants us to reexamine our nuclear policy. Despite my opposition to the use of nuclear energy, I think this would be a good idea. If anything, I'm convinced it will be a reminder of why we shouldn't pursue this technology.

What I fear is that we have only demonstrated marginal ability in handling the operations of the country. Are we prepared for a regional responsibility? I say nuclear energy is not just about us because a large incident will affect our neighbors. Even something that gets into the local waters will spread to affect wildlife in South East Asia. If we're not afraid for ourselves then maybe we should have some consideration for our neighbors.

What I'd like to see before we start playing with nuclear energy are government agencies and infrastructure that reach an acceptable level of efficiency. 

We can start with really simple things like jaywalking and littering. Then we can move on to larger things like implementing safety procedures on construction sites. How about being less selective in enforcing the building code? Maybe one day we can be efficient enough to handle our garbage problems and prevent the pollution of rivers, overfishing in lakes and illegal logging. Maybe we can have efficient planning and communication so rescuers actually have rubber rafts during a storm and police have an idea of how to handle hostage situations. Are you getting the picture now?

Just because someone would benefit from a car and is capable of buying a car doesn't automatically mean he should be driving one.

Radiation Prank Texts

On March 14,2011 there was a text message making the rounds that claimed radiation from Japan would reach the Philippines by 4pm. I checked the supposed source of the information, the BBC, and found no mention of a massive radiation leak. The Nuclear Research Institute and the International Energy Commission also did not have any warnings. The text was a prank.

It's times like these that I'm glad we don't have a nuclear power plant in the country. I can imagine the panic when a text like this would mention a national nuclear plant. Given the trouble Japan's having over the endangered nuclear plants, I think we should seriously reconsider our ideas. We can barely respond properly when storms and motor accidents strike. Remember Ondoy? Nobody had rubber rafts despite the fact it rains yearly. How about the settlers on the banks of rivers that often flood. Or the incident where dam authorities released water and forgot to tell local governments. Can you imagine that comedy of errors in a nuclear incident?

We're Number 1!... for most expensive electricity

The Philippines now has the most expensive electricity in Asia. As reported in the local papers, independent think tank International Energy Consultants said energy in the country cost an average of 18.1 US cents. By comparison Japan's electricity costs 17.9 cents. Further, household consumers pay the most, averaging 10 pesos per kWh or about 25 US cents. They offer a multitude of explanations for this - paying too much for Malampaya gas, lack of government subsidies, privatization.


Whatever the reasons, obviously the situation is detrimental to the country. There are a lot of solutions we can pursue. The obvious ones - renegotiating Malampaya prices, government subsidies, reverse privatization - may cause even more problems. Once again it will demonstrate that the government does not think straight and will reverse its decisions whenever politically convenient. That fosters an environment of uncertainty. Uncertainty discourages long term investment whether the investment is international or local in origin.


Perhaps a better solution would be to encourage energy conservation and small scale production. That's in line with the thrust towards privatization and the encouragement of small scale industries. Remember, privatization was undertaken to avoid the inefficiencies of public governance, potential for graft and the growing debt burden. The idea of encouraging small scale enterprises was to provide jobs and harness the potential of small scale entrepreneurship.
If we marry the two and pass laws encouraging small scale energy production we'd be hitting more than two birds. Suppose we implemented net metering. People with solar panels can sell back their excess usage to the energy company. More residents will be encouraged to install panels not just to save money but to produce income by generating more energy. More energy, higher incomes, lower prices, cleaner power.

Suppose we give tax breaks to small scale renewable energy investments. Farmers will have an additional source of income. What if we gave subsidies to small scale power generation? Maybe people will develop areas with less fertile soil if it can be used for energy production. Perhaps more readily available energy will make marginal farms more profitable as well. Solar, for example, could be used to power irrigation pumps or small desalination plants. If anything, we should be spending more effort into this instead of just focusing on oil efficiency.
.

AFP in Hot Water

Corruption in the Armed Forces. We've heard the whispers and rumors since the time of President Cory Aquino. One of the pet theories about the numerous coup attempts she weathered was that the corrupt members of the military were afraid she'd dismantle their schemes.

I'm actually surprised that our senators act like this is news.For one, given the history of our senators its obvious they'd know there were shenanigans. For another, The intelligence funds were always a source of suspicion especially during the time of President Gloria Arroyo. Given the above, mugging it for the media seems unnecessary. The citizens aren't that naive.

I'm just wondering if this will turn out to be another ZTE where the hearings proceeded with bombast then fizzled with little result. I'm hoping it won't turn out like the Garcia case where collusion is now suspected between the defense and prosecution.