THE BLOG

Benigno Aquino: Transformational or Transitional Leadership?

Without a doubt, the Philippines is finally on the move -- and well on its way to regain its long-sought place of pride among Asian nations. After decades of stagnation, political uncertainties, and anemic economic performance, the country has emerged from the ashes of despair, confidently riding on a wave of cautious optimism.

Today, the country has one of the world's fastest growing economies, one of Asia's most bullish stock markets, a constantly improving credit rating, a booming real estate, and a strong currency that is helping an increasingly mobile and confident consumer class.

Despite its reputation as Asia's 'sickman,' or even a regional basket case as others have suggested, the Philippines hasn't been a stranger to success -- definitely far from being a lifetime laggard. Back in the '50s, the country was one of the world's fastest growing economies, relishing Asia's second highest per capita income after Japan. Manila's soft power lied in its status as a regional hub of fashion, commerce, travel, and culture. It was a beacon of democratic capitalism in the whole Asia -- reflecting the relatively benign colonial legacy of America.

However, over succeeding decades, the Philippines found itself steadily falling behind its regional peers. First came the Newly Industrialized Countries (NICs) of South Korea, Taiwan, and Singapore. Then, the Philippines watched with much envy the likes of Malaysia and Thailand overtaking it. By the early 21st century, Vietnam and Indonesia -- to Manila's horror -- began outdoing their Filipino counterpart. With Myanmar opening up its economy, some commentators have sardonically suggested a new competition for the Philippines.
There is nothing romantic about a former high school jockey watching all his classmates cruising past him.

So, why has the Philippines -- a former regional leader -- fallen behind its Asian peers? Why does it suffer from one of the highest rates of underemployment, malnutrition, inequality, and poverty in Asia? Well, basically because of a lethal cocktail of bad policies, cultural complacency, and weak (if not bad) leadership.

The issue of culture is a tricky one. In his award-winning essay, 'A Damaged Culture,' veteran journalist James Fallows suggested that a culture of dependence, complacency, corruption and ineptitude lies behind Philippines' dramatic decline in the latter half of the 21st century. Yet, the problem with 'culture arguments' is that they have a static analytic approach, failing to understand the dynamic and mutually constitutive interaction between culture, on one hand, and the broader political economy, on the other.

Modern history is replete with examples of how so-called 'backward societies' -- described as lazy and savage by status quo powers -- have been transformed into one of the world's most innovative and progressive nations. After all, at the beginning of the 19th century, who would have thought that the feudal-agricultural Japan would rise -- thanks to the 'Meiji Restoration' -- as a global industrial power? Or, at the beginning of the 20th century, who would have imagined that relatively isolated Scandinavian states such as Sweden and Finland or resource-poor Northeast Asian countries such as Singapore, South Korea, and Taiwan would leapfrog to the top of global indices, in terms of infrastructure, innovation, science, and technology? This is where policy and leadership come into the picture.

In southeast Asia alone, if there is one thing that the likes of Malaysia's Mahathir or Singapore's Lee Kwan Yu could teach the Philippines, it is the fact that culture is malleable; it can change and be shaped along a particular vision -- thanks to information technology, universal education, and varying forms of state indoctrination and/or mainstreaming.

The very concept of 'nation-state' is in itself a construct, so when we say 'national culture,' we are also describing a specific construct. Thus, I find it a bit 'orientalist' to ascribe an essential cultural trait to a particular country, especially one as globalized and cosmopolitan as the Philippines.

In short, the maladies of Philippine society could be traced back to decades of bad leadership and wrong polices, which have failed to create the conditions for sustainable economic growth and political stability along democratic lines. For decades, a combination of corrupt leadership and technocratic incompetence has given birth to crony capitalism, oligarchic politics, and concentrated economic growth.

This is where the second question comes in: So, why is the Philippines re-emerging? Well, largely because of the new leadership of President Benigno Aquino III. When one starts from a relatively low base -- high rates of poverty, corruption, cronyism and political indifference -- it simply takes a clean, credible, and sincere leader such as Aquino himself to a) restore a measure of trust in state institutions and b) calm nervous markets.

Banking on his larger-than-life pedigree, Aquino's main focus has been to rid his country of corruption, especially in the upper echelons of the state. Staying true to his campaign promises, he has successfully pushed for the impeachment of leading magistrates (tied to the previous administration), who have been accused of public misconduct and corruption -- paving the way for the execution of Aquino's ultimate plan: to put former President Gloria Arroyo in jail for good.

Since President's Aquino's economic policies are not significantly different from his predecessors, the current economic resurgence is largely a reflection of growing market confidence in the leadership's ability to maintain political stability, shun draconian regulatory reforms, and provide a measure of macroeconomic predictability, especially in terms of interest rates and inflation.

Even rebel groups such as the Moro Islamic Liberation Front (MILF) have been encouraged by Aquino's sincere leadership, precipitating a historic 'framework peace agreement' that was signed between the rebels and the Philippine government -- potentially ending decades of conflict in southern Philippines. Overall, the Philippines' resurgence is not so much about Aquino's technical expertise as it is the good will expressed in his actions.

However, Aquino is yet to propose an economic agenda that will reverse Philippines' highly unequal, unsustainable, and concentrated patterns of growth. He has also been criticized for his lack of support for important transparency-boosting measures such as the Freedom of Information (FOI) bill.

This is why Aquino is perhaps more of a transitional rather than a transformational leader.

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