MANILA, OCTOBER 3, 2003 (STAR) DEMAND AND SUPPLY By Boo Chanco  - We have heard often enough that our country is hopelessly sick. Well, a doctor has just the remedy to get us back on our feet: Bayani Fernando. The doctor happens to be Dr. Raul Fabella of the UP School of Economics. I chanced upon an extremely long academic paper he delivered recently that attempted to diagnose what’s wrong with this country. Cutting through pages of his paper that is fairly difficult to read in a hurry, Dr. Fabella says the problem is the "powerless state."

That sounds like the Strong Republic rhetoric of Ate Glo as ghostwritten by Bobi Tiglao, only better. "When the state is powerless," Dr. Fabella asserts, "power effectively passes into private hands. It means that governance, which should be the sole prerogative of the state, becomes effectively balkanized." That pretty much describes to me our condition today.

"Enforcement, regulation, and rule-making," Dr. Fabella continues, "become fiefdoms of private interests in or out of government. This is also called the ‘capture of the organs of the state.’"He continues: "When state power is effectively privatized, it can be bought and sold in a krypto market brokered by ‘rents’.

"The powerless state is at the heart of a decentralized market for power over rules and enforcement. Where power, centralist or otherwise, is for sale to the highest bidder, rents replace value creation as the dominant source of wealth. Since value-creation is the true and only wellspring of economic progress, the economy languishes."

A powerless state, according to the eminent economist, was bound to founder in the shallow waters of unending legal, or worse, legitimatical challenges. "To function effectively, a state requires both carrot and stick – carrot where the stick does not work and vice versa. Having no stick, however, it can only move forward with carrots, otherwise called payola. And payola only sows a harvest of futility, which cannot trigger a leapfrog of the contradictions of EDSA ’86."

The doctor’s prescription: Bayani Fernando. I don‘t think Dr. Fabella wrote his dissertation to campaign for our good friend who is running for vice president. In fact, I asked BF and he has not even seen the Fabella paper and I doubt if he even knows Dr. Fabella well enough, if at all. BF just caught the attention of Dr. Fabella who was studying precisely why our country is not moving despite all the favorable trappings of democracy and even with what Lito Camacho and Romy Neri love to trumpet as our "good fundamentals".

What apparently caught Dr. Fabella‘s attention is BF‘s stubborn determination to reclaim lost state power. "Commonwealth Ave., QC, from Quezon Memorial Circle up to the Litex Road is experiencing a transformation that can only be considered a revolution. It appears like the dawn of a new order. Whence is this transformation? Why suddenly this beachhead of order where disorder was once unchallenged?"

"For starters, the prohibition of left turns and the provision of U-turn slots have reduced travel time through the stretch by about 50 percent or more (40 minutes to 20 or less minutes on average). To complement these innovations, the islands around the Quezon Memorial Circle were removed to allow a free flow of traffic.

"Trees were balled and removed to the chagrin of tree lovers. But one suspects that the net environment impact of faster traffic flow is positive. The proper way to address the tree-controversy is not by absolute cost or absolute benefit but by a balance sheet of both.

"The system is now largely self-enforcing, a feature which has reduced the number of visible MMDA traffic agents from a dozen on rush hours at each intersection to two or three to monitor the U-turn slots. The cost savings implied is of the order of magnitude of a major technical innovation in manufacturing and must be valued similarly.

"This is the time compression phenomenon that transformed East Asia in the last three decades of the 20th century. In those fateful decades, the travel time from downtown Bangkok to Bangkok Airport dropped from two hours to 30 minutes or less. Travel time from QC to NAIA, by contrast, had risen from 30 minutes to one hour and 30 or worse in the daytime.

"In 1970, bus travel time from Tutuban Station to Baguio City was six hours and you could set a lunch date at your arrival time. In 2000, bus travel from Manila to Baguio lengthened to between eight hours to 12 hours and the actual time of arrival is a throw of a dice. We have a national artery in Central Luzon where tricycles and funeral processions dictate the speed limit as it ambles through town and barangay centers.

"This is where we missed the East Asian miracle boat. National competitiveness is a joke until we can begin to properly run our highways and collect our garbage. Which is why what is happening in Commonwealth Ave. (CA hereafter) is more crucial for nation-building than 20 years of endless blab in the nearby Batasang Pambansa."

The second part is the clearing and demolition of illegal structures and squatters along Commonwealth Ave. The burgeoning squatters along CA and other public corridors essays 20 years of decline of QC presided over by a series of inconsequential and feckless mayorships which delivered the capital city to filth and squalor. In one inspired moment of courage and resolve, the shoulders of CA were cleared.

"An interesting sidelight of the clearing must be told. When the left-hand shoulder of CA was being cleared, the right-hand shoulder squatters, realizing this clearing was inexorable, began dismantling on their own. Gone was the tire-burning traffic-jamming defiance that stopped half-hearted demolition of old.

"The majesty of the law has its uses. Singapore is one material evidence. None was spared who illegally encroached – rich or poor. Now, CA is being remade and looks poised to become a modern artery fit for the 21st century.

"How did all these come to pass in a ‘powerless state’? Why was this force not trumped by an endless barrage of TROs and coddling and nattering politicians which are the normal fixtures of these events? How did the ‘powerless state’ suddenly gain muscle during the Commonwealth episode?"

The focal point of these miracles, for this UP economist, is Bayani Fernando. "When BF accepted the MMDA chair, he was already ‘bigger’ than the office. He could demand and exercise a hand free from customary endless meddling. He could ‘say no.’ He could also, if overly meddled with, step down and not be diminished.

"BF had clearly demonstrated to all and sundry that power re-concentrated can be employed sometimes brutally if fairly in the service of the law. Power need not always be pressed in the service of the heavily escorted Explorers and F150s or of Swiss bank accounts. Power can be employed to deliver tangible public goods."

Dr. Fabella had more to say in his case study of Bayani Fernando than I have space in this column. Suffice it to say at this time that the doctor is also afraid that if BF is for real, the immune system of the powerless state would reject BF precisely because he is seen as a threat to the established disorder. In the end,. Dr. Fabella hopes and I am sure we all share his hope, that Filipinos work hard to deserve democracy; to complete EDSA; to finally become "worth dying for."

Reported by: Sol Jose Vanzi

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