Investment risks: natural and otherwise

Media

Part of The American Chamber of Commerce Journal

Title: Investment risks: natural and otherwise
Language: English
Source: The American Chamber of Commerce Journal Volume XXV (No. 4) April 1949
Year: 1949
Rights
Abstract: Editorial
Fulltext: those elements in China which draw their inspiration from Russian “communism” rather than from the free democracy of the West. China’s troubles and sufferings, and the world’s difficulties over China, do not come so much from faulty Western diplomacy, however, or even from any present lack of Western power to aid, as from the fact that China is still, in the international political sense, a virtual vacuum. With the threat of conquest from one direction eliminated, a threat from the other direction immediately develops. If the government which at present seems to be slowly forming can fill the vacuum, that may be a positive gain wherever the immediate ideological in spiration may come from, for there remains the hope that the Chinese “Reds” are, first of all, Chinese. America is not interested in winning for itself the control of China, and never was. Adams’ state ment that the struggle for the control of China must decide the control of the world, is to be doubted. He gemony is not determined by areas or populations, but by power. But America is deeply interested in China being controlled by the Chinese rather than by the Russians, acting for themselves or through pup pets. If the Chinese “Reds” are not puppets, then per haps America in due time could take certain mea sures, — of friendship and aid, to keep them from ever becoming an advance guard for further Russian penetration, imperialistic or ideological. As in the days of John Hay, fifty years ago, are we too prone to consider ourselves impotent and to accept in advance a prophesied result of current dev elopments, seeing no way to prevent this? Is there today a John Hay who, through some bold stroke, will wrest another chance for the Chinese people out of the welter and ruck of the present con fusion? Indian Home Minister Patel at New Delhi re cently pointed a distinction that may prove of value in clarifying the present world conCommunism tention over communism. and Commu- In warning the Indian commu nist parties nists that the Government would suppress violence, he said that it would not seek to exterminate the ideology under lying communism, but that it would have no alter native to suppressing the Communist Party “if it persisted in exploiting every situation in order to cause chaos.” There are no doubt numerous idealistic people in the world, outside of Russia (perhaps more outside than in), who, if not believers in the whole commu nist system, see a possible social gain in the abolition of the private ownership of the “means of produc tion,” — a gain in exchange for which they would as sume the risks of the consequent tremendous increase in the arbitrary powers of government. Many would favor such a development outright if the change from private to public ownership were progressively and always legally and ethically effected, as seems at pre sent to be happening in Britain. But even these people, — not hostile to commu nism as such and even convinced or half-convinced that a communist economic system would be prefer able to capitalism, are outraged and rightly execrate the means adopted by present-day Russia allegedly to promote world communism, and deeply distrust and flatly impugn its motives and aims, as a world power, as well. By what right, under any code ever lawfully framed by man, may the Russian oligarchy, through the conspiracies it foments everywhere, sap and de stroy the chosen institutions of other peoples, creat ing dissention and tumult and riot, disloyalty, betray al, crime, and treason? Is disintegration and chaos the road to a new and better order? Can hatred prepare the way for love? Does evil turn to good? Is not the Russian so-called communism plainly the satanic thing which its measures at home and abroad, show it to be? The ideology of true communism we can study and reason about. Present-day communist parties should be dealt with for the criminal organizations which they are. President Quirino, in his remarks on March 4 before the conference of the 81st District of Rotary International at the Manila Hotel, Investment deigned to make a good-natured Risks — Natural reference to the editorial in the and Otherwise February issue of this Journal in which we spoke of his wearing rose-tinted glasses when he delivered his address on the State of the Nation before Congress. He admitted that he was an optimist. He de clared that he does not propose to be a crape-hanger and that in addressing Congress he was not presid ing at a wake or leading a funeral. That was good rhetoric. He honored and pleased the assumed writer of the editorial by dubbing him a “very good friend of our people,” but implied in his speech that this writer was among those who are sour seekers of disaster, frightened by bugbears largely self-created. We are hesitant about taking advantage of Mr. Quirino’s condescension to enter into public argument with him. We would take no pleasure in proving him wrong, especially on the topic which he chose to speak on to the Rotarians, — conditions in the Phil ippines as they relate to American capital invest ment. We wish he were right and that our fears, so-called, were only self-created. But a wish is not a conviction, and we are sorry to say that Mr. Quiri no’s arguments were not convincing. Dropping all idea of arguing with the President, may we not simply advance a few reflections that oc curred to us in reading a report of what he said? In the first place, we do not believe the country is doomed because of import control. We do not be lieve that the country is doomed at all, though we do think that the country’s advancement is being serious ly retarded and that we may all come in for much needless suffering as a result of this. And not alone because of import control, but because of the ever extending autocratic government control over every phase of the country’s economy. And not only be cause of that, but because of the discrimination throughout much of this control against so-called alien enterprise, which, only to mention the Flag Law, goes so far as to deny the right to ownership of the smallest tract of land to aliens. Enacted legislation has been definitely handicapping established business and much of the projected legislation threatens to handicap it further, especially in the fields of corpo rative organization and of labor-capital relations. 141 The President suggested that American capital was not deterred from developing the American West because of the risks, the hardships and dangers of frontier life, including the menace of the savage In dian tribes, and said that he could not believe that American capital has lost its pioneering spirit and will fail to come to the Philippines because conditions here are believed to be “not attractive, not easy, not secure.” If we may quote: “I like to believe that American capital, as a potent ins trument of industrial progress for the advancement of de mocratic liberties and social amelioration wherever it has taken root, is still true to the spirit of Americanism which makes America the leader of the world today. I like to be lieve that being morally strong by tradition and inheritance, it does not have to rely solely on special privilege for itself, that it is not easily intimidated into retreat by mere chal lenges to its genius for adjustment in a new setting to justify its leadership of free nations.” This prompts the thought that the Indians, at first, at least, had only bows and arrows, knives, clubs, spears, and tomahawks, later some guns; they never had the mace of governmental authority,— executive, legislative, and judicial. And shooting members of Congress, judges, and department and bureau directors and other government officials, or putting them on reservations, can’t be done! American capital here asks for no “special privi lege,” but only for equal opportunity and freedom from arbitrary governmental intervention in the pro cesses of production, investment, and trade. The President bracketted “planning” and “na tionalization” together when he said: “Planning and nationalization are a dynamic political and social reality, spelling resistance to unregulated free enter prise and possibly keeping its rewards within humane and civilized sanctions.”. We are sure that American capital is not looking for anything outside such sanctions as the President mentioned, and there is no objection to national plan ning. “Nationalization,” however, is another thing. One certainly can not expect foreign capital to come into a country where the general trend is toward a rapid “nationalization,” — that is, where legislation is deliberately being framed to discriminate against such capital and to impair the capitalist’s control over it. “It is to be observed,” said the President, “that the systematic nationalization going on in England has not discouraged the billions of dollars that Ameri ca is pouring in there.” May we observe that these billions constitute gov ernment loans and not private capital investments? And that these loans- are being made as a part of the Marshall Plan for all of Europe chiefly for political and strategic and to some extent for humanitarian reasons, and certainly not for profit in the business sense ? The President said that he did not want an as signment as an undertaker, a mortician, for the Re public. If he and other leaders would only realize that the country has already had to bury some of its high hopes, — among them that during the past three years or so following the liberation American invest ment capital would come in in volume. That it has not is largely due to the fact that conditions have been more or less deliberately rendered less favorable and less propitious than they might have been. However, the very fact that Philippine leaders are showing signs of sensing this, is an important step in the di rection of the ultimate correction we still hope for. The general aim of present government policy is natural enough. As the President said: “We want our own people to have a proportionate share in the enjoyment of our economic opportunities.” American capital would not question this as any thing but commendable. But when the means adopt ed become frankly discriminatory, there can be but one result. Putting the matter in the simplest language: American, or any other, capital will accept natur al risks as a part of all capitalistic enterprise, but it does not choose to operate under a deliberately dis criminatory sovereign government. President Quirino pointed to a distinction which is important in a democracy, — that between leaders and bosses, in his address at the comLeaders mencement exercises last month of the and Bosses Philippine Women’s University. He said, in part: “Bossism is not real leadership. It is a corruption of leadership... If we are loyal to our democracy we must as sess our leadership in terms other than those of bossism... .We must believe in the common man’s right and capacity to think... The idea that the common people are gulls, useful pawns in the political game.. .belongs to the past... The people do not need anyone to whip them into line... Their will becomes clear... It is a sound government that recognizes and accepts its authority... A real democracy is where the people create the leaders...” In United States political slang, a boss (from the Dutch baas, master) is a “professional politician who controls a large number of votes in a party organi zation, or who dictates, unofficially, appointments and legislative measures”. A boss heads a political “machine”. The diction ary defines this word in that sense: “The committees or other working bodies, often under the power of a boss, especially in a political party, through which its policies and activities are directed and its nomina tions and patronage are often largely controlled, for private rather than for party or public end." Lincoln Steffens, author of the book, “The Shame of the Cities”, has told that when at the turn of the century he was visiting the various big cities whose corrupt governments he exposed, his first ef fort always was to discover not who was the mayor or the chief of police or who any of the other im portant officials were, but who the boss was. Some times this man held office, but often he did not and skulked in the background. There have also been such state machines, but, city or state, when they became too openly corrupt, the people revolted, “turned the rascals out” at the elections, and often sent the bosses to jail. Leaders of the American federal government have rarely been charged with graft, and the national party organization in the United States has, indeed, always been loose and without the compactness re quired for a regime of corruption. A distinction must be made between legitimate party organization anywhere, and the political ma chine of a boss or “ring” of public grafters. Political parties are natural to a democracy. They are broad divisions of the electorate, standing for certain dif ferences in ideals and policies of government. They naturally seek to influence the voters and to get their own candidates elected. But they do not resort to 142