science and politics 1: Nobel physicist David Jonathan Gross

During the holidays in January, I had the chance to exchange a few words with Nobel physicist David Jonathan Gross during his visit to Cebu. One of his more striking observations was that the lifestyles in the West (the so-called developed world) were not sustainable in the light of the growing evidence that human activity is in the main responsible for global warming of recent years.
But what struck me more was his observation that politics often trumps science but that the major problems of the world could not but be solved through politics (broadly defined), ultimately.
The visit was not covered well in the press, national or 'provincial'. That's why I'm publishing here my feature which was published in Cebu Daily News Jan. 21.

Hard Science not enough to solve mankind's contemporary problems---Nobel physicist

In a country where hard science is usually trumped by political 'science', the lecture by David J. Gross, one of the Nobel laureates for physics in 2004, on “The Lessons of Science” at the University of San Carlos College of Architecture and Fine Arts (CAFA) Jan. 11 was not only appropriate but serendipitously helpful. The lecture was part of a series under the auspices of the “Bridges---Dialogues Toward a Culture of Peace” program of the Vienna-based International Peace Foundation headed by Dr. Uwe Morawetz.

We say appropriate and helpful because protagonists in two major developments in Cebu and environs--- the offshore oil exploration in the Tañon Strait, and the proposed Cebu trans-axial highway--- are resorting to 'scientific' arguments to buttress their positions. At the national level, a debate is raging over the net environmental impacts of the widespread production and use of biofuels, and Filipinos are finding it difficult to sift through the so-called evidence and claims in regard to the Glorietta blast in October last year. In all these cases, preconceptions and political biases get in the way of objective evaluation of phenomena and the indentification of cause and effect.

But Dr. Gross himself accepts the limits of hard science and the need for politics in addressing mankind's most challenging contemporary problems, among them widespread hunger and the potentially catastrophic consequences of human-induced global warming. Far from being the stereotypical 'mad scientist' people tend to associate with genius, the well-groomed physicist looked more like the John Lithgow character in Third Rock from the Sun, often incredulous at the practices and beliefs of earthlings. The global character of these problems, he said, required internationalism and effective global government envisioned by Albert Einstein.

The Lessons of Science

The announced title of the lecture was “The Coming Revolutions in Fundamental Physics” but Dr. Gross thought that the time allotted would not do the subject justice. Also, he was unsure about the nature and interests of the audience. The core of the scientific method, 'discovered' about the same time USC was established over 400 years ago, according to Dr. Gross, is observation and experiment, and the only authority scientific ideas 'bow' to is agreement with nature itself, and not to “political power nor religious faith.” “All theories are provisional...(and are refined by continuing verification guaranteed) by 'making findings available to all.' The implications of the scientific method go beyond scientific research because a healthy scientific culture requires an open society. Science promotes tolerance and democracy because in scientific inquiry, all are considered equal, he said.

In his one-hour lecture, Dr. Gross briefly traced the development of science and emphasized how young its branches are: physics, 400 years; astrophysics/cosmology, 100; biology, 150.

Perils, predictions, and guarded optimism

The standing arsenals of nuclear weapons with the potential to end all life on earth within hours constitutes a continuing scandal, Dr. Gross said in response to a question on nuclear proliferation posed by this writer during a press conference shortly before the lecture. Checking the spread of nuclear weapons remained difficult if the superpowers held on to their stockpiles which, he said, were utterly useless. The physicist reiterated the nuclear threat in his lecture, where he warned that science can and has been used for both good and bad.

But the overwhelming theme of the lecture, however, was optimism over the future of mankind. Dr. Gross boldly predicted that in the next 100 to 1000 years, the human lifespan---which has doubled in the last two centuries--- would be ten times what it is now and that human life would spread to other areas in the universe. Closer to the present, he said, the behavioral sciences would achieve the status of 'real science' in the next 50-100 years.

It takes a Nobel-class physicist to re-inspire awe in what is already well accepted in the scientific community: that humans are puny creatures in one planet revolving around a sun which is one among a 100 billion in our galaxy, which is among 100 billion galaxies in the universe that is said to have started with the Big Bang 13.7 billion years ago. What was behind the Big Bang? When and how did time begin? Dr. Gross would not hazard a guess as to when these questions would be answered. Science, after all, continues to leave us with “informed, intelligent ignorance,” “We' ve learned that all of our concepts are provisional...subject to continuing questioning, challenging...and improvement.”

A feather for San Carlos

Dr. Gross, together with David Politzer and Frank Wilczek, received the Nobel for Physics for his theory on the strong force, the nuclear force that binds quarks, the smallest buildiing blocks of matter, and that binds the nucleus of the atom. He was conferred the San Carlos Borromeo Award by Fr. Roderick Salazar in behalf of the University.

The 400 year-old USC was one of two venues outside Metro Manila (the other was Ateneo de Davao) chosen by the International Peace Foundation for its continuing Bridges lectures,which promotes international understanding, among others, through visits by Nobel laureates that share its vision. Prior to the recent series in the Philippines, all of the lectures were held in Thailand. When USC president Fr. Roderick Salazar was first contacted by Dr. Morawetz, elation readily gave way to organization. It was Fr. Rod who chose Dr. Gross from the foundation's roster. It is not well known that science, physics and chemistry in particular, is a flagship program of USC. The Commission on Higher Education (CHED) has in fact recognized USC as a center of excellence in chemistry. Fr. Rod told me that preparations for the lecture begun early last year and that the university was asked to shoulder the business class tickets of Dr. Gross and company. The exposure of Cebu academia to Nobel-class high theory, and not just the prestige for USC, was well worth the expense, Fr. Rod said.

Two internationally recognized Filipino physicists, Christopher C. Bernido and Maria Victoria C. Bernido of the Research Center for Theoretical Physics at the Central Visayan Institute Foundation in Jagna, Bohol were on hand for the lecture. Christopher introduced the guest speaker while Marivic moderated the open forum. The CVIF is known for putting the Philippines on the world map in theoretical physics and has brought a number of Nobel physicists to the Center without fanfare.

The Bridges 2008 lecture series resumes in the Philippines February 4-8 with Prof. Finn Erling Kydland, Nobel economics laureate 2004, slated to discuss “Peace and economic development in the age of globalization” February 8 at the same venue in USC.

(Our thanks to N-ding Mission of the USC Library System for providing us with dvd's of the lecture and open forum. As USC apparently has no plans of transcribing the proceedings, I will take the trouble of doing that myself. The transcripts wil be made available here in due time).

Corrruption and inefficiency in Philippine Rural Electric Cooperatives

The conventional wisdom is that the major reason for inefficiency and corruption in rural electric cooperatives in the Philippines is the lack of incentives for good management. Because there is no group of private stakeholders large enough to care how an REC (rural electric cooperative) performs, the managers are left to their own devices, especially if their pay is not linked to such performance. While the coop members elect the boards of directors which in turn supervise the managers, that is pretty much where their participation ends, which is why it has been said that the RECs are cooperatives only in name.

REC elections are also said to be well-contested because the boards exercise tremendous political power; in some cases even more so than local government elections. In fact, the party-list party of the rural coops, APEC, has always been a top vote-getter in national elections owing to a large bloc of ‘command votes.’

Occasionally a group of members might have enough community spirit to exercise vigilance over management while the rest of the members simply ‘free-ride’ on their efforts. This is also why the standard (and perhaps even dogmatic) prescription is to encourage the entry of private capital imbued with a profit motive to lower costs. But that is just one solution to enforce greater accountability and efficiency, by encouraging greater membership participation.

This is what this account of graft and corruption in BATELEC II (Batangas Electric Cooperative II) illustrates: member vigilance and heroic management. The board, elected in 2003, is facing charges of corruption brought by some members (in 2005) for approving and awarding a P75 million computerization contract to I-Solv, a company based in Metro Manila, with a paid-up capital of P62,500 and organized just a few days before the contract award in April 2004.
The graft charges were presumably lodged after the National Electrification Administration (NEA) audit, at the instance of the same group of members, found the whole project irregular for lack of the proper technical study and bidding. Furthermore, the board had usurped the authority of the bids and awards committee, the audit said. It also found that the board approved a 100% overprice of 10 boom trucks. In this controversy, general manager Marlyn Caguimbal has been on the side of the members.

It is unfortunate that PDI reporter Marlon Ramos ends his account with developments way back in 2005 and thus leaves us wondering on the status of the case and what other actions, if any, the NEA has taken against the board.

About nine years ago, I had occasion to visit the offices of BATELEC I, the other REC serving Batangas, and was impressed by the professionalism of management. The REC had been chosen for a brief historical case study, excerpted in a chapter of The Challenge of Rural Electrification, Strategies for Developing Countries, edited by Douglas Barnes and recently published in May by Resources for the Future (RFF) and Energy Sector Management Assistance Program (ESMAP). I co-wrote the chapter on the Philippines “Power and Politics in the Philippines” with Gerald Foley.

Taxi strike: unfare?

Philippine taxi drivers are generally a friendly lot, though there are many horror stories associated with rogue drivers who reject fare, short-change passengers, collude with robbers, and eject customers midway through trips. (The last shows cab drivers know their economics and the value of time, because some would even give up the registered fare simply because going further would result in a loss---in other words, they think in terms of 'net incremental benefit.'

They are are also a bit talkative and need little provocation to lecture you on politics and philosophy, and many of them in their 60's would still even hark to the 'good old days' of Marcos and the period of discipline and (false) sense of national purpose. With a little provocation they'll even tell you whom they voted for in elections and subtly try to sway you to their position. I have always used their stories as a vane to give me a sense of the social weather. In one unforgettable ride not too long ago, a driver, having eavesdropped on my conversation on politics with a friend, butted in politely and eventually confessed he was an 'intelligence agent' of the armed forces. No, his cab driving was not a front but genuine moonlighting, though that was not really reassuring. And cell phones were not affordable then. In fact, at about the same time in 1995, I was amazed that my cabbie in HK handed me his handset to call a friend to ask for directions. And no, his name was not Vidal Doble.

Once, in my early 30's, I was mistaken by a cabbie as of his age. After I complained about the metallic rock on his radio, he gently reminded me that things were a lot different in 'our time.' I didn't protest that because I had much earlier accepted having been born old and grumpy. But then, in another ride, while I was waiting for change, this young driver insisted he recognized me as a lead member of a local rock band.

I don't know the status of renewed efforts to finally enforce the requirement in the tax code (circa post-Marcos 80's) that cabs should issue receipts to passengers as part of enhanced tax-revenue generation. I guess government has balked again. I agree with the measure but recognize government has to be fair to both cab companies and drivers but fairer to drivers and to passengers. Clearly there is a lot of room for improved regulation of behavior. The economic fact is that drivers merely respond to the so-called incentive structure of the system, like free 'profit-maximizing' agents who take all the demand risk, because they pay a fixed rent regardless of kilometers travelled or fare volume. Bus drivers, on the other hand, get a share of revenues. But in congested thoroughfares, the resulting behavior results in disastrous consequences for both passengers and air quality (I digress too much, as usual).

I travel fairly often and fairly wide and know that Philippine taxi rates are among the cheaper in the world, and have spent large sums because of my habitual laziness and addiction to door-to-door delivery. An absolute increase in fares resulting from regulation might do a lot of good all around, most of all by encouraging more mass transit patronage. With some caveats, mainly for people like myself, who, as a lazy patron, also use cab drivers to attend to other addictions. When I was a beer-drinker and smoker, and whether alone or with guests, but as lone occupant in a single male-headed household, I would call the nearest cab company to request delivery of beer and cigarets.

Do cabbies generally overcharge? I don't think so. Rates are much higher in areas where entry is either regulated or banned, especially airports. That is because the entry regulator is usually corrupt but justify the regulation as part of ensuring passenger safety. Hell, they could do that by simply charging a parking fee and enforcing a monitoring system.

Without much ado, local cab companies have been shifting to alternative fuels like liquefied petroleum gas (there is an LPG filling station just a few hundred meters from where I live) because it makes financial sense. It also results in less harmful emissions.

This brings me to the implications of this news article from the New York Times, New York Taxi Strike:

Fare increases in 2004 and 2005 — totaling some 25 percent — were contingent on taxi owners installing global positioning systems and credit-card machines. Drivers were desperate for the increase — the first in eight years — and accepted the terms. That was the deal they made, and they should stick to it. The city had an equal obligation to make sure the mandated technology is functional, up-to-date and serves both driver and passenger. So far, the results are not encouraging.

It is not surprising they are talking about GPS and credit card payments while we are arguing about receipts. After all, we are in the Philippines. But our level of economic development, I should say, does not really indicate our comparative level of civility.

Electricity and Philippine Growth: amateur detective work

I can understand why the recent GDP growth figure of 7.5% has elicited a lot of skepticism and hostile criticism , and most of the justification has to do with the fact that even the middle class, especially in Metro Manila don’t feel better off compared to last year.

Let me first disclose that I am confident about the professionalism and integrity of the people who compile and estimate the growth statistics. I have worked for long periods with NEDA assistant director general Estrella Domingo, mainly in the nineties, and mostly in regard to estimating the environmental impacts of growth. She and her people are competent and open to criticism and suggestions, especially in regard to methods.

First let us grant that the statistics are correct. The natural questions to ask are where did the growth come from, which sectors and which regions?

Growth in electricity consumption

My preferred method of validating economic growth figures is through looking at electricity consumption. So I examined the sales figures of Meralco for the first semesters of last year and this year. The second row of the following table shows percentage growth in kilowatt-hour consumption by customer class. The Meralco service area comprises about 60 percent of value added (GDP) in the Philippine economy.

Residential	Commercial	Industrial	C+I	Others	Total
3.02	5.78	3.59	4.83	-1.80	4.18

From the figures above, here are my initial observations, not necessarily in order of importance:

The NSCB claims growth is consumption-led. Clearly growth in residential consumption is much less than overall growth, and is also less than growth in personal consumption expenditures of nine (9) %.. Thus the elasticity of demand for household electricity is less than 1 (0.33), which means an additional peso of income creates much less demand for electricity in the Meralco area. This could be higher in areas outside MM (AOMM)., which is intuitive because these areas are starting with less electricity consuming appliances.

1. But looking at C+I in electricity consumption in Metro Manila, which is much less than growth in the value added of the service and industrial sectors (8%) per NSCB nationwide, I can only surmise that growth in these sectors must be happening in AOMM. Unfortunately, the NSCB does not provide a spatial disaggregation of value added and growth. But this is the most likely explanation I can find.
2. If we assume that GDP growth in Metro Manila is the same for the rest of the country, it would mean that the elasticity of demand for electricity overall with respect to GDP growth would be .56, which is contrary to historical experience and incredible.

From the above, if we assume the NSCB figures are correct, these can only be explained by higher growth in AOMM.

To whom is credit due?

Here I will allow myself some political bias, which you might agree is justified. The effects of policy always come with a lag, and it would be fungus-faced (to quote my favorite senator) for the Arroyo administration to claim credit for the growth figures. It is probable that phenomenal growth occured inspite of its incompetence and erratic responses to threats of its survival. One thing I can concede, without offering empirical proof, is that the value added tax did and does lead to a higher growth trajectory.

Equity and skepticism

Among the more reasoned essays with respect to equity and healthy skepticism published in cyberspace recently are those of Ricky Carandang and Manolo Quezon.

On the matter of equity, the Central Bank used to publish a disaggregation of GDP into returns to capital and labor but it stopped doing this sometime in the 1980’s. A simple way of ascertaining whether growth is equity-enhancing would be compute the growth in the ratio of labor's share per capita (simply divide the labor share of value added by population growth). Unfortunately I have no method to estimate this, though I suspect that if domestic demand is fueled by OFW income, growth, and if consumption growth accrues to sectors in the economy with market power, growth might be inequality enhancing. Note that I am not sure about this.

For those interested in the structure of the economy and the growth figures click here. The NSCB has one of the better government sites, but please write the webmaster and demand that it present data files in downloadable format.

wiretaps in aid of effective electricity spot market regulation

A funny thing happened on the way to a competitive electricity market in the Philippines.

Let me start again. A funny thing happened when the electricity regulator was investigating anti-competitive behavior of the state-owned utility. The regulator said there was no prima facie case even after the market operator furnished them with affidavits admitting such behavior. This is one for the books, but not surprisingly because the country lacks a history of anti-trust litigation.

Let me start again. In September last year, the Philippine Electricity Marketing Corporation (PEMC) lodged a case with the ERC accusing the PSALM of market manipulation. The investigator of the ERC did not even have to call Jack Bauer of CTU. The affidavits of the PSALM agents are clear that they bid to get a desired price.

Then the ERC dismissed the case for lack of prima facie evidence.

It seems like the ERC was looking for legally wiretapped conversations which could have gone this way.

Hey Juan, at the peak demand, we should tweak our bids this way and that.

Unfortunately for consumers, ERC was not forward-looking enough to install bugging devices in the rooms of PSALM and the ERC or NPC. What a pity.

So the spot market celebrated its first anniversary in the first week of August without fanfare because PSALM was demanding a to collect P9 billion, the difference between spot rates and administered prices imposed by PEMC for two months last year.

If you read the ERC decision you'll know that the investigator didn't need to call Jack Bauer of CTU because the PSALM affidavits were quite candid and in themselves incriminatory.

The continuing decline of energy sector institutions

Just had dinner with a reliable newly elected congressman who quoted other neophytes requesting anonymity in aid of obscurity. The buzz in the House is that the unpalatable Michael Defensor is being groomed to be energy secretary. From good to acceptable to bad to worse. What say you?

'extra-judicial killings'

You have to give it to the intrepid Ricky Carandang of ANC. He always manages to interview the most unlikely guests, and last night’s were truly exceptional: Chief Justice Reynato Puno and Associate Justice Adolf Azcuna. Listening to the justices reassured me that the judicial branch has at last and at least have been seized by the problem of extra-judicial killings, actually an inappropriate phrase since we no longer have the death penalty, and for good reason, and thus we cannot have judicial killings. The two justices were only being diplomatic in refraining from publicly castigating the two other branches---especially the executive---for their inaction and perhaps, even complicity in the murders and disappearance of political activists. Our alleged president would not have shown any concern had not human rights organizations mobilized international opinion on the spate of killings and disappearances. One can only wish that the supreme court had the power to fire justice secretaries, because the one we have does not know the meaning of shame.

Azcuna enlightened mewith a discussion of the Minnesota protocol, where, if the victims are last seen with military or state agents, it is the burden of the latter to explain and extricate themselves. After all, it is the state which is supposed to have a monopoly of the gun. This protocol becomes more relevant in the case of a government which has taken Donald Rumsfeld’s logic: the absence of evidence is not evidence of absence. Thus, the state can arrest you, torture you, and bomb other countries to kingdom come on mere suspicion of terrorist inclinations.

I don’t know if the justices volunteered to be interviewed, but if they did, they chose the interviewer well. Carandang is competent, prepares well in advance, and has exemplary interviewing skills. More likely it was he who approached them and the justices could not refuse. In any case, the interview was to bring attention to this Monday’s summit on extra-judicial killings and one can only hope it succeeds.

Also yesterday, Conrad de Quiros discussed his frustrated search for the movie ‘Missing’ which affected me too. It was played not too long ago in one of the cable movie channels. I think it is available from the many movie websites abroad.

And before I forget, I really appreciated The Big Picture’s interview with the officials of the National Statistical Coordination Board (NSCB) and former economic planning secretary Felipe Medalla on problems with the estimates of GDP growth. Unfortunately, this was not carried intelligently by the national papers. Among the respectable columnists, only Ciel Habito mentioned the problem and the discussion but he did not have the space for a satisfying follow-up. ( I asked my niece Charo Logarta whether she found the latest estimates credible and her response was to the effect that these were not estimates but ‘actual’ figures as she understood them from a press conference. I had to remind her that figures based on a survey or sample should be treated as estimates.)

I will say my piece on these issues some other time.