Friday, 14 May 2010

RH Bill a dead issue

Manila Bulletin

Whoever gets elected as the next President of the Philippines, he would be well advised to assign the lowest priority to population management or population control among his immediate concerns during the first 100 days of his mandate. In fact, I would even say he should dismiss it as a dead issue. There are more positive, direct and effective solutions to mass poverty and unemployment that are free from controversy. Although I respect economists and other experts who strongly support population management as a means of combatting mass poverty, the truth is that there is absolutely no consensus among leading economists both here and abroad about the correlation between population growth and poverty. There are Nobel laureates and other leading international and national economists on both sides of the debate. The jury is still out about whether or not promoting the use of artificial contraceptives could be a major solution to mass poverty.

As a long-standing critic of population control, let me summarize here why a legislation like the RH Bill could be economically counterproductive.

The most recent evidence that a large population is an asset and not a liability to a developing country like the Philippines is what I call the "VIP phenomenon." During the Great Recession we have just experienced, only three countries in East Asia (with the exception of China) avoided a recession.

These are Vietnam, Indonesia and the Philippines (the VIP countries of the ASEAN). A key explanation for the resilience of these three countries is their large domestic markets that partly insulated them from the depressive impact of a shrinking world economy. Even if they also experienced large declines in their exports like the tiger economies such as Singapore, Hong Kong, South Korea and Taiwan (which all suffered a recession), their large populations served as strong domestic markets for their business enterprises, both large and small. In the next ten to twenty years, the countries with large populations such as China, India, Brazil, Indonesia and others will be the engines of growth, eclipsing the aging OECD countries who, with the exception of the United States, are all suffering from the devastating effects of the demographic winter.

Another strong argument against population control is the peculiar case of Thailand. Even prescinding from the ongoing political unrest, Thailand's still relatively large population of over 60 million did not enable it to get into the list of the Next Eleven emerging markets that will dominate the global economy. Because of a very aggressive population control program in the last century, Thailand is in serious danger of growing old before becoming rich. Despite its extraordinary success in improving the productivity of its agricultural sector by investing wisely in countryside infrastructure, Thailand is still far from being a developed country. But its aging population is now growing faster than its labor force, threatening to engulf the country in a demographic winter too prematurely. To make matters worse, the aggressive distribution of condoms in the last century has made Thailand the worst victim of HIV-AIDS in East Asia, with some one million people infected with this dreaded disease. Being once considered our non-identical twin, Thailand should be a model for us in the area of agricultural development. But we should avoid literally like the plague its population control experience.

The next President knows very well that the most serious challenge to his Administration will be to raise government revenues in order to reduce the fiscal deficit, while still spending large amounts in infrastructures and in improving the quality of public education. Time and again, we have been told by international agencies, both public and private, that 400 billion pesos are being lost to corruption every year. About half of this is due to those who cheat the Government by not paying their taxes. This is private sector corruption, with the connivance of BIR officials. The other half is due to corrupt government officials in the Department of Education, Department of Public Works and Highways, Department of Agriculture and others who channel public funds to private pockets. By aggressively going after these corrupt people, as President SBY of Indonesia has done in his first five years, the next Administration will be able to significantly reduce the fiscal deficit while still having enough revenues to continue improving our physical infrastructure and the quality of education.

It would really be foolish for the next President to assign any importance to the RH Bill which can only divide the country needlessly and not even promise an immediate solution to the pressing problems of the national economy. As I have written so often, there are dozens of tried and tested solutions to mass poverty in the Philippines, solutions that can easily generate consensus. Among them are building farm-to-market roads, irrigation systems and post-harvest facilities; providing microcredit to the poor; developing small and medium-scale enterprises; putting up vocational and technical schools for the out-of-school youth; financing social housing for the poor; and teaming up with the private sector to assist returning OFWs in starting sustainable small businesses in which they can invest their savings. Let us ignore the voices of those in the new Congress who will try to resuscitate a dead horse, the very controversial RH Bill. For comment, my e-mail address is

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