Capability is What Remains
By Karl M. Garcia
For decades, countries have been placed into categories: First World, Third World, developed, developing, emerging.
But labels tell us less than a simpler question:
What can a country reliably do?
Can it educate its people, build and maintain infrastructure, produce competitively, connect its regions, operate complex systems, respond to shocks, enforce its rules, defend its interests, innovate and improve what it has already built?
More importantly:
Does that capability accumulate over time?
That is a more useful definition of development.
A high-capability Philippines would not need to be perfect or dominant in every sector. It would be a country whose people, institutions, businesses and infrastructure can repeatedly convert resources into productive outcomes—and learn from experience well enough to perform better the next time.
Development is not the accumulation of projects. It is the accumulation of capability.
From Laws and Projects to Capability
The Philippines is not short of legislation.
It has laws covering education, agriculture, industry, energy, environment, transportation, maritime affairs, investment, taxation, local government, digital technology, social protection and national security.
It will need more. Laws remain necessary when government lacks authority, when legal gaps must be closed or when public interests require institutional protection.
But the central question should not simply be:
What law should we pass?
It should be:
What are we trying to accomplish, what is preventing us from accomplishing it, and what combination of law, policy, resources, institutions and capability will remove that constraint?
That distinction matters.
A law can establish authority and direction. A budget provides resources. Agencies administer programs. Workers provide skills. Infrastructure provides physical capacity. Technology provides tools. Industry provides investment and productive capability.
Citizens ultimately experience the result.
Good governance connects these pieces.
The actual chain of public policy is therefore closer to:
Problem → diagnosis → policy design → legal authority where necessary → financing → institutions → people → systems → infrastructure → implementation → measurement → results.
Legislation is one component of that delivery system.
A national program may also require appropriations, personnel, procurement, regulations, facilities, data systems, technology, supply chains and coordination across institutions.
A law creates the framework. State capability makes the framework work.
Start With the Constraint
Government should begin with the outcome, not the instrument.
What are we trying to accomplish?
What is stopping us?
If authority is missing, legislate.
If funding is inadequate, address the budget.
If procurement is the bottleneck, fix procurement.
If skilled workers are scarce, train and recruit.
If infrastructure is inadequate, build it.
If regulations conflict, simplify them.
If information is fragmented, connect the relevant systems.
If several institutions must act together, strengthen coordination.
Often, the answer is several of these at once.
Consider shipbuilding and ship repair. A stronger industry cannot be created by legislation alone, but neither can it develop without an appropriate policy and regulatory environment. It requires investment, competitive costs, skilled workers, technology, shipyard infrastructure, financing, efficient government processes, supply chains and access to markets.
The same principle applies to the Blue Economy, energy, agriculture, digital infrastructure, transport, healthcare and defense.
A coastal community needs more than a policy declaration. It needs infrastructure, finance, technology and market access.
A marine researcher needs more than a mandate. The researcher needs vessels, laboratories, equipment, data and sustained funding.
An investor needs more than an industry strategy. The investor needs predictable rules, infrastructure, skills and commercially viable conditions.
A military needs more than platforms. It needs trained personnel, doctrine, logistics, infrastructure, information, maintenance and industrial support.
This is the difference between policy ambition and state capability.
An Asset Is Not a Capability
A bridge is an asset.
Reliable connectivity is a capability.
A hospital is an asset.
Effective healthcare is a capability.
A patrol vessel is an asset.
Maritime awareness and enforcement are capabilities.
A digital platform is an asset.
Reliable digital government is a capability.
An aircraft is an asset.
The ability to sustain air operations is a capability.
A radar is an asset.
The ability to detect, interpret, communicate and act on information is a capability.
Projects end.
Capabilities must be staffed, financed, maintained, measured and improved.
The question after every major investment should therefore be:
What can the Philippines do after this that it could not do before?
If the answer is merely that another asset exists, capability accumulation may be limited.
If the answer is that Philippine institutions, workers and companies can now perform new functions reliably, the investment has begun to compound.
Specialization Without Fragmentation
One of the recurring weaknesses of government is fragmentation.
Government is organized by agencies.
People experience systems.
A commuter experiences the transport network, not the separate mandates of road, rail, traffic and local-government agencies.
A farmer experiences the entire value chain, not separate agencies for agriculture, roads, ports, finance and trade.
A coastal community experiences the watershed-to-ocean system, not separate mandates for fisheries, pollution, drainage and disaster response.
A cyberattack can affect banks, hospitals, telecommunications, ports and government systems simultaneously.
A maritime confrontation can become a defense, diplomatic, transportation, energy, fisheries, law-enforcement and economic problem at the same time.
The problem does not respect the organizational chart.
But specialization is not inherently bad.
It is how complex states develop expertise.
The Coast Guard should remain a Coast Guard. The military should concentrate on national defense. Diplomats should concentrate on diplomacy. Energy institutions should understand energy systems. Disaster-management institutions should understand disaster risk reduction and emergency coordination.
Specialization is not fragmentation.
Fragmentation occurs when specialized institutions cannot function together when the problem crosses their boundaries.
The answer is therefore not automatically to merge them.
It is to build the capacity to integrate them when necessary.
A capable state needs different operating modes.
In ordinary conditions, agencies should operate primarily within their specialized mandates.
As risks rise, coordination should increase.
During a major emergency, interagency mechanisms should become more active.
During war, national mobilization may become necessary.
After the emergency, extraordinary arrangements should be reduced as conditions permit.
The objective is not permanent emergency government.
It is scalable government.
The state should be able to change gears without rebuilding itself.
Interoperability Is a Capability
The PNP Maritime Group, Coast Guard and Navy do not need identical mandates simply because they operate at sea.
They need interoperability.
They should know who responds first, who has jurisdiction, who supports whom, how information is shared, how an incident is handed over and what happens when the situation escalates.
The sea does not care which department owns the vessel.
The same principle applies across government.
Integration should occur at the level where the problem requires it—not automatically at the level of the organizational chart.
A maritime incident may simultaneously matter to the Coast Guard, Navy, PNP Maritime Group, BFAR, MARINA, Customs and national-security institutions.
If each sees only its own information, government possesses several partial pictures.
If relevant institutions can share authorized information through interoperable systems and agreed procedures, the state can develop a common operating picture.
That does not mean creating one giant database accessible to everyone.
It means connecting systems where connection is necessary while maintaining appropriate security, access controls and institutional responsibilities.
The principle is simple:
Many institutions. Shared situational awareness. Clear authorities.
This requires preparation before a crisis:
- clear command and coordination relationships;
- interoperable communications;
- shared information standards;
- joint exercises;
- cross-agency liaison arrangements;
- common crisis scenarios;
- continuity-of-government arrangements;
- preplanned logistics and resource-sharing mechanisms; and
- clear legal authorities for emergency action.
These arrangements may appear unnecessary on an ordinary day.
That is precisely why they must be built on an ordinary day.
You cannot improvise an interagency state in the middle of a national emergency.
Defense Modernization Is a Capability Test
Over the past decade, the Philippines has built a stronger defense foundation.
The Armed Forces of the Philippines has acquired newer aircraft, ships, radars, communications systems, unmanned platforms and other capabilities. Training, exercises, infrastructure and international partnerships have expanded.
The country is no longer where it was.
But modernization now faces a more important question:
How does capability accumulate?
An aircraft is an asset. The ability to sustain air operations is a capability.
A ship is an asset. The ability to maintain maritime presence, surveillance, deterrence and response is a capability.
A radar is an asset. The ability to detect, interpret, communicate and act on information is a capability.
A drone is an asset. The ability to turn persistent sensing into decisions is a capability.
Every platform sits inside a larger chain:
People → Training → Equipment → Information → Operations → Maintenance → Learning.
If a critical link is missing, the platform’s potential is reduced.
Modernization should therefore measure availability, readiness, integration and sustainment—not simply deliveries.
Buy capability, not merely equipment.
The same principle applies to national resilience.
Defense readiness depends on infrastructure that rarely appears in acquisition headlines.
Ships need ports. Aircraft need airfields. Units need roads. Communications need power and connectivity. Data systems need networks. Bases need fuel, water, medical support and logistics.
Civilian infrastructure can also contribute to resilience without becoming military infrastructure.
A commercial port can provide logistical options. An airport can provide transportation alternatives. Fiber networks can provide communications redundancy. A resilient power system can sustain critical services.
The objective is not to duplicate everything.
It is to avoid excessive dependence on a single critical point.
A blocked port should not stop an entire region.
A damaged bridge should not permanently isolate a community.
A failed communications system should not eliminate all communication.
A disrupted supplier should not automatically stop a critical service.
Resilience is the ability to keep the system functioning when one part of it does not.
MRO Is Where Ownership Becomes Capability
Maintenance, repair and overhaul may be less visible than procurement, but this is where ownership becomes sustainable.
The progression should be:
Operate → Maintain → Repair → Modify → Integrate → Selectively produce.
The Philippines does not need to manufacture everything.
Self-reliance should not become autarky.
It should mean having enough technical and industrial depth to understand what the country operates, maintain what it reasonably can, repair critical systems, manage supply risks and reduce dangerous dependence.
The objective is strategic competence.
Defense modernization can build national technical capability through engineering, fabrication, software, cybersecurity, inspection, maintenance, logistics and other support functions where economically viable.
The same principle applies to civilian strategic industries.
Acquire → Learn → Certify → Localize → Sustain.
The critical question for every major technology partnership is:
What Philippine capability exists after the contract that did not exist before it?
That is the difference between buying a service and building capability.
People Are the Capability That Must Compound
Equipment can be delivered in months or years.
Deep expertise takes decades.
A country can have thousands of engineers and still lack enough people with repeated experience in nuclear safety, aerospace systems, naval architecture, advanced manufacturing, specialized quality assurance or other complex fields.
A degree produces education.
Repeated professional practice produces expertise.
Some expertise takes decades to accumulate.
When capability is scarce, the country should be willing to pay for scarcity—but specifically for the combination of scarcity, competence and strategic value.
The objective should be:
Acquire → Transfer → Localize → Retain.
Bring in experienced specialists.
Put Filipino professionals beside them.
Create deputies and successors.
Document procedures.
Build laboratories and standards.
Develop local suppliers.
Transfer progressively more responsibility.
Then reduce dependence as domestic capability grows.
Filipinos already working abroad should be part of this strategy. They do not necessarily have to return permanently. Visiting appointments, technical rotations, research collaborations, project participation and remote advisory work can turn brain drain into brain circulation.
But talent will not stay simply because government asks it to.
People follow opportunity.
A world-class engineer will leave if the country has no industry capable of using that expertise.
Talent policy is therefore industrial policy.
Build the Ecosystem, Not Just the Facility
Strategic projects should create opportunities for Philippine companies in engineering, fabrication, inspection, maintenance, software, cybersecurity, logistics and other supporting functions where they can meet required standards.
Localization should be progressive, not artificial.
Import what must initially be imported.
Train people to international standards.
Certify local suppliers.
Bring Philippine firms into supply chains.
Increase local participation as competence grows.
The objective is not to claim that everything can immediately be made domestically.
It is to continuously expand what the country can competently do itself.
Nuclear power illustrates the principle clearly.
A reactor requires much more than a reactor. It requires regulation, safety culture, engineering, quality assurance, trained operators, emergency preparedness, security, maintenance, fuel arrangements, waste management and a capable industrial and institutional ecosystem.
The question should therefore not merely be:
Which reactor should we buy?
It should be:
What must the Philippines be capable of doing to safely own, operate, maintain and eventually replace it?
The same question applies to sophisticated ships, aircraft, satellites, semiconductor facilities, energy systems and other complex technologies.
Ownership of equipment is not ownership of capability.
Institutional Memory Is Productive Capital
Capability also fails to accumulate when experience disappears.
A retiring officer may carry decades of expertise in command, intelligence, logistics, engineering, maritime operations, communications or training.
A technician may possess specialized knowledge of a platform that took years to acquire.
If that knowledge disappears at retirement, the country loses part of its investment.
Retirement should therefore be treated as a transition, not a cliff.
Where appropriate and subject to security and conflict-of-interest rules, experienced personnel could move into credentialing, teaching, technical work, reserve service or advisory roles.
The objective is not to guarantee every retiree another career.
It is to prevent avoidable loss of human capital.
The same principle applies to institutions.
Democracy should permit governments to change priorities. It should not require the state to forget what it has already learned.
Bad programs should be terminated.
Weak programs should be redesigned.
New priorities should be added.
But strategic direction, institutional knowledge, standards, productive assets and accumulated capability should survive political transitions.
Otherwise every administration begins another cycle of planning, reorganizing and rebuilding.
The country becomes experienced at starting over rather than building forward.
Institutional memory is therefore not bureaucratic nostalgia.
It is productive capital.
Scale What Works
The Philippines can produce an excellent pilot project.
The harder question is whether it can work ten times larger, in another region, with ordinary personnel and sustainable financing.
Scaling is institutional engineering.
The sequence should be:
Pilot → Measure → Standardize → Adapt → Scale → Institutionalize → Evaluate → Improve or Terminate.
Government should scale evidence, not enthusiasm.
Best practice is not automatically best fit.
Standardize what must be standardized. Adapt what should be adapted.
A successful project is not yet a national capability.
It becomes one when the country can reproduce the result reliably.
Build a Capability Architecture
The Philippines does not necessarily need another grand plan.
It needs existing plans to accumulate.
Every major national initiative should make its logic visible:
National Outcome → System → Program → Project → Responsible Institution → Budget → Output → Outcome → Evaluation.
The operating discipline should be:
Set Outcomes → Map Systems → Assign Ownership → Build Platforms → Pilot → Measure → Scale → Institutionalize → Evaluate → Improve.
For scarce strategic expertise:
Acquire → Transfer → Localize → Retain.
For national resilience:
Prepare → Coordinate → Integrate → Mobilize → Recover → Improve.
For ordinary government operations, institutions should remain specialized.
For cross-cutting problems, they should become interoperable.
For crises, they should be able to change gears.
These are not competing models.
They are different operating requirements of the same state.
Measure What Remains
The most useful modernization metrics are therefore not limited to the number of laws passed, projects completed or platforms purchased.
Measure readiness: How much of the capability is actually available and deployable?
Measure sustainment: Can it be maintained and repaired reliably?
Measure people: How many qualified specialists, instructors and successors exist?
Measure interoperability: How quickly can relevant information and resources move between institutions?
Measure resilience: What happens when a critical facility, route, supplier or system fails?
Measure reserve: How much civilian expertise can actually be mobilized?
Measure industry: What can Philippine firms now design, maintain, repair, integrate or produce?
Measure learning: What lessons have been institutionalized?
Measure continuity: What survives retirement and changes in administration?
Measure delivery: What measurable improvement did the law, budget or program actually produce?
For strategic expertise, ask how many Filipino specialists were developed, how many successors were trained, what standards were institutionalized, what suppliers became qualified and what functions became locally sustainable.
For whole-of-government readiness, ask how quickly agencies can establish a common operating picture, shift responsibilities, mobilize resources and sustain essential services under stress.
That is how state capacity becomes measurable.
The Country We Plan and the Country We Build
The Philippines has a Country We Plan—development plans, master plans, laws, budgets and strategies.
It also has a Country We Build—roads, ports, factories, schools, hospitals, farms, cities, digital systems and security capabilities.
The gap between the two is the real test of governance.
The objective should therefore be neither endless planning nor endless construction.
It should be accumulation.
Every major investment should leave behind something more valuable than the asset itself:
better people,
better institutions,
better systems,
better suppliers,
better data,
better standards,
better maintenance,
and greater capacity to do the next thing.
A law that cannot be implemented is incomplete policy.
A project that cannot be maintained is incomplete development.
A technology contract that leaves no local competence is incomplete transfer.
An agency reorganization that destroys specialized expertise is not necessarily reform.
A successful pilot that cannot be reproduced is not yet national capability.
An administration that leaves no institutional memory forces the next administration to pay again for lessons already learned.
From Labels to Capability
The Philippines does not need to master everything.
No country does.
It needs to identify what matters strategically, where its advantages lie, where critical gaps exist and which capabilities will generate the greatest economic, social and national-security returns.
Then it must build those capabilities deliberately.
That means:
Specialize without fragmenting.
Integrate without unnecessarily consolidating.
Scale what works.
Preserve what has been learned.
Pay for scarce expertise when necessary.
Transfer that expertise to Filipinos.
Build domestic suppliers.
Create industries capable of retaining talent.
Prepare institutions to change gears before a crisis arrives.
Measure what remains after the project, contract or administration is gone.
The development discipline becomes:
Define the outcome. Identify the constraint. Choose the instrument. Assign responsibility. Fund it. Build capability. Implement. Measure. Correct. Institutionalize what works.
Sometimes that requires a new law.
Sometimes it requires better regulation, budgeting, procurement, infrastructure, training, technology or coordination.
Often it requires several at once.
That is not a criticism of legislation.
It is recognition of its proper place in nation-building.
A good law establishes authority and direction. Good governance connects the machinery. State capability turns both into results.
The state does not become capable because its agencies are merged.
It becomes capable when specialized institutions can work together without losing the expertise that makes them valuable.
The real test of institutional design is therefore not how government looks when everything is normal.
It is what happens when normality disappears.
Can the state recognize the problem?
Can it establish who leads?
Can it share the necessary information?
Can it move resources?
Can agencies support one another without fighting over jurisdiction?
Can it sustain essential services?
Can it shift from routine administration to national action—and eventually return to normal?
If the answer is yes, specialization becomes a strength rather than a weakness.
If the answer is no, another merger will not necessarily save the system.
The Philippines needs a state that can change gears without losing its institutional memory, specialized expertise or capacity to deliver.
Build the connections in peace.
Exercise them before they are needed.
Clarify authorities before they are contested.
Share information before everyone needs it at once.
Acquire scarce expertise when necessary—and turn it into domestic capability.
Then make sure the next administration inherits more than the previous one inherited.
Because when a national emergency arrives, the country will not have time to reorganize the bureaucracy.
It will have to use the state it already built.
And the ultimate measure of that state is simple:
Can the Philippines do more, together, than it could do before?
That is capability.
And capability is what remains.
“The sea does not care which department owns the vessel.” LOL, I laughed at the truth of this. The opposite of capability is incompetence and that is very much a people thing, as capability is a people thing. Yet the goal is to make it a systematic, unemotional, mundane, persistent thing without human fallibilities: like greed, arrogance, politics, favoritism, emotionalism, and risky uninformed judgments.
Plus, capability presumes self-control in a world out of control: natural disasters, China, Trump, pandemics, and potentially AI.
So it’s a tough road ahead.
The Philippines needs more honor, or personal ethics, in national and local leadership. People who are able to put skills and productivity ahead of greed, favoritism, and all that. Knowledge is less a problem today than last year thanks to AI. Anybody can be smart enough. The question is, are they honorable enough.
The vanquishment of Trumpism looks like it will finally begin this November. Districts that are Trump +15 are at risk, ruby-red states like Kansas(!) and Alaska(!) are in play, and MAGA is in a complete panic.
I have been watching with alarm (and in preparation of my post-election Ukraine trip) at the rise of the European far-right and far-left/Islamists. In Paris on the Avenue Des Champs-Élysées, a few blocks from my cousin’s house, it is being burned by the far-left and Islamists claiming to protest “school conditions” not long after Pope Leo traveled down the same route weeks ago — the real fear in France is that the far-left under Le Pen (neo-Nazis) will win next year’s elections. In the UK the Green Party has lost their minds over performative Palestine, endangering the fragile Labour Party hold of Parliament according to my Liberal British cousins — the far-right Reform UK could very well win in the nearing elections. In Germany, where I will be staying for a few days like last year before heading to the Poland-Ukraine border, the far-right AfD (neo-Nazis) took over control of the Saxony-Anhalt government. In Spain the leftist government has been a complete governing failure — giving rise to the far-right Vox Party (neo-fascist). I don’t know, I’ve told my cousins that I may just proceed directly to Poland rather than trekking overland through Western Europe.
What do all these events have in common? Principally Russian disinformation which is moving away from the US and to Europe now that Trumpism has been a disappointment for Moscow. I suspect in a few years the excesses of MAGA will seem like child’s play compared to what may come to Europe. The US has had multiple periods of upheaval then righting herself without war; Europe does not, and my worry is that the post-WWII Pax America allowed Europeans to forget how Europeans traditionally handled societal disruption… through continental war…
Talked to a Fil AM Reservist Army Major if he still supports Trump, unfortunately he still does even with this war. I just told him to enjoy his retirement which is almost soon
The infiltration of MAGA into the US military occurs mostly at the junior enlisted level and mid-grade and below commissioned officers (like your major friend who will retire soon without advancing) who have hit a wall in advancement. The US military draws members from all walks of American society and do not have restrictions on political views as long as it doesn’t bleed into professional conduct. There are conservatives as well as liberals in the US military. What matters is their Constitutional Oath regardless of personal politics. I have high confidence that the US military senior, general, and flag officers adhere to the Constitution and will continue to do so. There will be a time for political reckoning for those who break their Oaths, which godwilling will come soon.
I doubt if reservist will tell you what he really really thinks, have to stay loyal to his chief, or his head will be on the chopping block. o baka isama pa siya to the one who is about to face the firing squad!
No, if a US Military service person or public official is “loyal to the chief” they are already breaking their Oath. The Commander-in-Chief is temporary — the Constitution is not. Enlisted need to obey lawful orders from the President. Commissioned Officers only obey the Constitution (Article VI). Of course during Trumpism there are some servicemembers who disregarded their Oath and instead pledged political allegiance, sometimes brazenly. Obeying unlawful orders is not a defense. They will be dealt with in time as Oathbreakers. The US Military, through the Army, existed before the Confederation (predecessor of the US) existed.
Officer’s Oath:
Enlisted Oath:
when trump was asked if he has to uphold the constitution, he said he dont know.
Well, he is a traitor to his country after all. Something many MAGAs are waking up to as well.
Off tangent to this convo
Re US ship building playing catch-up to China???
By Karl M. Garcia
There is an irony in the United States spending $6.6 billion to help rebuild its submarine industrial base.
For decades, Americans were accustomed to thinking of the United States as the world’s unmatched industrial and military superpower. Yet China now possesses an enormous advantage in commercial shipbuilding capacity, while America’s ability to build even its most important naval platforms has become constrained by aging facilities, workforce shortages and fragile supply chains.
The new Anduril facility in Maryland is therefore about more than another defense contract. It is an admission that military power ultimately depends on industrial capacity.
And this raises an uncomfortable question: Is the United States now playing catch-up with China?
In shipbuilding, increasingly, yes.
China can produce commercial vessels at a scale that the United States cannot match. America’s nuclear-submarine production is concentrated in only two shipyards, and those yards are struggling to meet desired production rates. The problem becomes even more consequential when Washington simultaneously wants to modernize its own fleet and fulfill commitments under AUKUS.
The response is revealing. Rather than simply ordering more submarines, the United States is trying to rebuild the ecosystem behind them—components, suppliers, automation, skilled workers and production capacity.
This brings us back to another distinctly American warning: beware the military-industrial complex.
The warning, associated most famously with President Dwight Eisenhower, was not that America should have no defense industry. It was that a permanent alignment between the military establishment and defense contractors could acquire excessive influence over national priorities.
But the current problem exposes the other side of that argument.
An underdeveloped defense industrial base can also become a national-security vulnerability.
The answer, however, cannot simply be to spend more money on defense contractors. That would risk creating exactly the system Eisenhower warned about: ever-growing expenditure without necessarily producing greater strategic capacity.
The real challenge is different: Can America rebuild industrial capacity without allowing the defense industry to become the master of defense policy?
That means measuring outcomes rather than contracts. It means competition rather than protected monopolies where possible. It means investing in the workforce and supplier base, not merely buying finished weapons. And it means recognizing that shipyards, machine shops, steel, electronics, software, logistics and skilled labor are all part of national defense.
China’s rise has therefore produced an uncomfortable lesson for Washington.
The military-industrial complex is not simply too powerful.
In some critical areas, the industrial base may actually be too small, too concentrated and too fragile.
America’s challenge is to rebuild it without recreating the very dependency and political distortion that Eisenhower warned about.
That may be the real race with China: not who can announce the most weapons, but who can build the industrial system capable of producing them at scale.
india seems to be the next major economic power, outpacing china’s gross domestic products. kaya pala, when india’s prime minister modi was last in china, he left before he can view the show of might, the parade of chinese armaments at the square showcasing the power of china’s military arsenal. not all leaders of the world are awed with china’s opulent display.
A lot of reasons for this, but basically: during the Peace Dividend both the US and Europe reduced or eliminated state subsidies for ship building and the steel industry, where under the following free market with the US focusing on highly-complex naval vessels and the EU focusing on highly-complex commercial vessels (like luxury cruise ships). China, Japan, South Korea still pour massive state subsidies into their shipyards, but this mostly is in the area of commercial shipbuilding so the sophistication of naval vessels is still far behind the US.
Friendshoring Meets the Donroe Doctrine
By Karl M. Garcia
Friendshoring was built on a relatively simple assumption: in an increasingly uncertain world, supply chains should move away from geopolitical rivals and toward trusted partners. The Biden administration did not invent the idea, but it made “friendshoring” a central expression of economic security.
The emerging Trump-era framework changes the calculation.
What analysts have called the “Donroe Doctrine”—a reworking of the Monroe Doctrine around stronger U.S. primacy in the Western Hemisphere—is not formally a U.S. doctrine in the legal sense. It is an analytical label used by Eurasia Group to describe a broader pattern of American policy: greater willingness to use economic pressure, security leverage and bilateral bargaining to secure U.S. interests in the hemisphere.
The important shift is therefore not that friendshoring has been officially banned. It has not. The deeper change is that friendship itself is becoming insufficient.
Mexico illustrates the problem. The United States continues to negotiate with Mexico under USMCA, including rules of origin and economic-security provisions. But Washington has simultaneously increased pressure over Chinese transshipment and the structure of North American trade. The White House has even identified Mexico, Canada, Japan and other countries as routes through which Chinese goods can circumvent U.S. tariffs.
This produces something closer to conditional friendshoring: you are a friend, but only if your supply chains satisfy our definition of strategic alignment.
That is materially different from the earlier logic.
Friendshoring sought resilience through a network of trusted economies. The emerging model seeks resilience through control over the network.
That distinction matters globally.
Companies can no longer assume that moving production from China to Mexico, Vietnam, Indonesia or another politically friendly country automatically creates durable access to the American market. Rules of origin, Chinese content, transshipment, tariffs and strategic-sector restrictions increasingly become part of the investment calculation.
The consequence may be an unexpected form of reverse friendshoring: instead of simply diversifying production among friendly countries, companies may increasingly diversify away from dependence on the United States itself.
That does not mean abandoning the American market. It means building optionality—more suppliers, more markets, more regional production and fewer assumptions that geopolitical friendship guarantees commercial stability.
For countries such as the Philippines, this is an important lesson.
The objective should not be to choose between Washington and Beijing. It should be to become useful to multiple economic systems without becoming dangerously dependent on any single one.
The world may be moving from “friendshoring” to “strategic optionality.”
In that world, the most valuable country is not necessarily the one with the most powerful friend.
It may be the one with the most choices.
There is a big gap in this output (which I wonder could be closed if model higher effort is applied, but that would use 3-5x tokens):
The US consumer market is a 100-ton gorilla that no one can ignore, not China, not the EU, and certainly not the Philippines whose global export share is something like 0.35-0.40%.
The distastefulness of Trump’s rhetoric aside, one needs to separate what certain politicians (Canadian, Mexican, non-UK European) say for domestic nationalist purposes (all these countries except for Canada and Germany have an even bigger post-imperial chip on their shoulders than the US ever will have), and what their actual actions are. For all the political talk of moving away from the US, their actions show they are in fact bear-hugging the US even more tightly.
The fact of the matter is the Trump tariffs principally hurt Americans (mainly MAGA voters who tend to be more poor) who continue to want to buy stuff that every other country exports, and that won’t change. Friendshoring is an entirely different thing that should be separated from Trump tariffs — friendshoring is a China de-alignment that is in the interest of every free and democratic country in a time of rising global authoritarianism led by China and Russia.
Aside from tariffs, Deportations removed farmers cleaers and the help.
MAGA is ok if they are doing it correctly not MAGA vs WOKE America first and foremost…
The Wokes are mostly affluent, mainly White, Americans who preach morals based on stolen Black ideas from their bubbles disconnected from any reality of others’ lived experiences. Filipino “Starbucks wokesters” are just the same.
MAGA is quite like DDS — they believe that some vague “bad people” are doing “bad things” not here but “over there” and thus must be disciplined, but the odd thing is MAGA can be very protective and upset when non-White neighbors who are part of their communities are taken away even if those neighbors are illegals who barely speak English. And like DDS, MAGA is mainly a grievance movement built on resentment that they did not get to partake in what they perceive as others getting richer (whether that is true or not). Russia has been quite expert in turning us against ourselves by exploiting differences, first trialed in the Philippines then the rest of the world.
https://newsinfo.inquirer.net/1558298/fake-news-persists-in-patient-zero-ph-lies-live-in-too-many-ways/
The only way out is to produce better economic outcomes for more people.
Crazy times, making the development of competence a bit chaotic.
crazy times give opportunities for the adventurous. there are people who thrive in chaos and make billions in their wake. business can be predatory but maybe that is the nature of money. competence one day, super competence the next until next cycle comes along and it’s back to square one.
While I am fairly confident that even under Trump 2.0 the US intensely values the Philippines as an ally and partner in a way Canada, Mexico and the EU are unfortunately not, there is still a lot the Philippines can do. It’s not about asking for assistance from the US and new partners beyond the US — the assistance is to help speed things up that the Philippines already started. The thinking needs to move away from the Build-Operate-Transfer-style paradigm which may temporarily increase capacity but does not develop long-term competence nor capability.
I am increasingly convinced that the only way to change the hold of political dynasties that perpetuate the patronage system is to convert either the dynasty or their constituents. The only way I can see that is available is to increase the number of enclaves of good governance and economic zones where rules-based performance and competence can be demonstrated for all to see. M4GG are enclaves of good governance. Special economic zones and freeports are economic enclaves directly supervised by the President (PEZAs can be declared by the President while the other two require Acts of Congress). In 1989 there were 6 special economic zones; today there are 437 (with rapid growth starting under PNoy, a lull under Duterte, then growth again under Marcos Jr.). Eventually the benefits from these enclaves will diffuse out and force political dynasties to either adapt or be replaced.
Hopefully that is what will happen.
Time to bring back the deserving meaning of honorable which is becoming cliche.
If it begins at home, it must not stay at home.
yeah, like the dishonorable senator na pati inodoro tinanggal, e. left the office na parang tinamaan ng bagyo! the floor tiles all taken away, light fittings included. he should have left the office the way it was when he 1st take over it, or if he has any honor left, he needs to return the previous fittings and fixtures. he can remove all his personal effects natural lang yan, but leaving the office with not a stitch on goes beyond the pale. else charge him vandalism.
Normal daw yun eh…. parang pinganak kahapon ang Senate media kung maniwala sila.
tutuo pala, his mother yata did not teach him manners. it is normal for him to act in such an abysmal manner, but not normal for us who were brought up to be considerate to others. even at poorly equip public schools where almost anything goes, our hapless and overworked teachers instill in us to show compassion, to say thank you and to be respectful of others.
sabi dating boy scout daw yang napaka priveleged na senador, sus maria! kung ganyan lang pala ang mga boy scout nuon, ah, baka boys kawat ang ibig sabihin, haha.
pero, seriously, he should have left the office the way it was when he 1st move in: habitable for next occupant.
so now maybe, senators will draft a bill called jinggoy’s law forbidding a losing incumbent to thrash the office and leaving the next incumbent to shoulder the hefty cost of refurbishment.
“The opposite of capability is incompetence and that is very much a people thing, as capability is a people thing. ” – JoeAm
Well said, and I agree. It is not a law thing, a rules thing, an infrastructure thing, an integration thing, etc. etc. It is a people thing. Competent people bring about the laws, rules, infrastructure, integration, etc. etc. and incompetent people fail to do so.
Karl, just a minor quibble: Third World only picked up the “poor” connotation at the late stages of the Cold War. Originally the definitions were First World (free democratic countries), Second World (communist bloc), and Third World (non-aligned countries). For example Sweden, Finland, Ireland, and Switzerland were defined as “Third World” by nature of their Cold War association with the Non-Aligned Countries (which is distinct from the Non-Aligned Movement of most but not all post-colonial states).
Still wrapping things up at work, but I have written down skeleton notes which I will elaborate on and post later.
P.S. the Philippines was a member of the First World due to its alignment with free democratic countries during the Cold War.
A very important quibble because until your comment I was wondering about Second world and of it is like second class which is a far second
To be fair, the communists talk about the definitions a lot more than liberals do. It seems the communists resented being placed into the “Second World” category, even though the categories are purely political system categories and not economic at all. Post-Cold War communists and global far-left are particularly fixated on “Third Worldism,” for example. It gets into esoteric territory fast, mostly involving communists fighting each other about what means what.
The Philippines is arguably highly successful in producing high human capability: nurses, doctors, engineers, maritime professionals, and so on. The Philippines does not have a problem with generating human capability; rather the Philippines does not have sufficient ability to absorb capability. This lack of absorptive capacity is a structural failure of incentives — incentive alignment failure.
In developmental economics expanding human capability is a prerequisite to accumulating productive knowledge which in turn increases economic complexity. In the Philippines, elite capture has always been resistant to the complex industrialization that absorbs generated capability (i.e. graduating professionals).
This has led to the rise of the OFW sector since Filipino families still need to feed themselves. Excess human capability that cannot be absorbed by the Philippines is exported as skilled, service, and intellectual labor building the capability of the OFW’s host country while remittances sent back home became one of the crucial legs that prop up the Philippine economy. Remittance-driven consumption feeds into a cycle that reinforces elite-capture by enriching retail and real estate rent-owners while perpetuating a Dutch Disease condition whereby inflows of foreign currency overvalues the Philippine peso thus starves domestic exporters of global competitiveness that prevents further development of industry. It’s not just my own joke that Philippine oligarchs would rather make money off of their import licenses and real estate — it is reality.
In order to create change in the existent paradigm, state capacity is needed. State capacity requires fiscal power, a bureaucracy with administrative independence that outlasts one administration, and the ability to discipline capital with industrial policy. However as explained by Hutchcroft’s Booty Capitalism, the Philippines has essentially been captured by elites (real estate and landowning families along with commercial oligarchs). The Philippine elite capture model rather than using state subsidies to discipline capital and incentivize behavior towards the export model, instead entrenched domestic monopolies, imposed tariff walls against imports that threaten domestic monopolists, and steered tax incentives towards sectors that cannot be exported (e.g. malls, telecoms, real estate, energy, etc.). If one wonders why there are so many malls in the Philippines, well, that’s the primary reason.
The famous Philippine institutional reset with each administration is a function not a bug of a system where wealth extraction depends on political access to captured rents rather than market competition. Philippine liberals, misunderstanding the system they live in from within their enclaved subdivisions, constantly complain about how each incoming administration immediately rolls back all their predecessor’s policies creating an institutional reset. The reality-informed may see an institutional reset as instead a re-awarding of concessions to those who align with the new administration (regulatory rules, infrastructure and industrial concessions). Again, a function, not a bug — in a spoils system, to the winners’ the spoils.
The biggest chance for re-alignment is what developmental economics call exogenous shock — e.g. war, pandemic, economic collapse, reversion to independence or democracy which temporarily breaks elite capture to allow room for a paradigm shift. Obviously exogenous shocks are undesirable for the suffering it may create. The Philippines also squandered multiple exogenous shock episodes throughout the last 130 years. The only choice is incrementalism that builds durable change. The CREATE Act is an attempt to re-align incentives in order to increase state absorptive capacity for Filipino human capability. In many ways the CREATE Act is incomplete and imperfect, but it starts to provide a blueprint of incrementalism that might start incentivizing rent-seekers by laying the groundwork for a globally competitive industrial policies. Time will tell if this strategy will last across the 2028 political transition.
Many thanks Joey for all your thoughts and insights.
Capability benchmarks in the BPO industry measured in office space absorption.
https://bilyonaryo.com/booking-years-ahead-ph-office-leasing-heats-up-as-demand-jumps-33/
One of my bosses love to say You cannot rise above your operating environment. have to slowly upgrade our operating environment. bit by bit we will increase capability.
Indeed!