In many free market literatures, a very important concept is the “rule of law” to mean that the law, rules and regulations apply to all players and citizens, no exception. The law applies equally to unequal people, and rulers cannot make exemption (for themselves, their friends and allies).
The opposite of rule of law is the “rule of men”, government politicians, administrators and leaders create laws that favor certain sectors and penalize or exclude others from such favoritism; they selectively apply the law to certain people while others are exempted from the restrictions and punishments of those laws.
The term “weak state” is heard more in academic discourses on political economy. As the term implies, it is an opposite of a “strong state”.
A friend for 2+ decades now, F. Kennedy Coronel, aka “Citizen Kori” in our frequent discussions and debates in pilipinasforum yahoogroups made a presentation during the Mining Conference 2012, I make some quick comments in his presentation, the full 29-slides powerpoint is found here.
For the definition of a “weak state”, he adapted Alex Magno’s definition,
• “porous to vested interests, powerful lobbies and populist constituencies. . .
• “Its policies shaped by short‐term interests rather than long‐term good, by particular benefits rather than the larger welfare
• “transactional…responds to particularistic political stimulus from specific constituencies…
• “vulnerable to political accommodation, compromising the integrity of policies to suit immediate contingencies…that are insistently noisy rather than ideas that are fundamentally sound”‐ A. Magno, 2012
As I mentioned above, these characteristics refer more to the “rule of men” and not “rule of law.” State leaders allow certain exemptions to the restrictions of the laws, very often to their families and friends, political allies, supporters and financiers. For non-friends or non-allies of state administrators, the restrictions of the laws fully apply, woe unto them.
A corollary to the “weak state” is the weak regulatory capability, defined by Kori as:
- “Complex regulatory regime… highly informal which influences lack of transparency, accountability, and increases legal and policy uncertainty and regulatory overlap and conflict, thus reinforcing the poor performance of the regime.” — Dr. Vl dao Vi lvoa
- Regulatory agencies have limited budget, personnel and equipment; EO 366 imposes limits to hiring by agencies, Regulatory agencies losing people to the private sector.
- MGB needs to hire technical staff.
The term “orphan industry” means an industry that has no political parents, populist politicians do not want to be associated with being too friendly with or supportive of, large-scale corporate mining.
Then he discussed the uncertainties in the sector, the new opportunities.
The options and strategies for the private sector to combat the “orphan industry” and general public dislike of large scale mining, according to Kori, are the following.
- Come with clean hands
- Build constituencies
- Avail of institutional remedies
- Engage stakeholders
- Build on platform of transparency
- Build a strong local team
- Communicate to stakeholders
Come with clean hands mean (a) Consistency in words and deeds, corporate behavior must reflect policies and principles, (b) Ensure that corporate conduct is all above board and no skeletons to surprise you, (c) Good housekeeping provides support in managing issues – Environmental responsibility and accountability, Fairlabor practices, Good corporate citizenship.
Build constituencies mean (a) Identify sectors critical to a project, seek ways of connecting, (b) Seek common grounds – Community development, Environmental awards, No to bribery, Be a preferred employer.
Avail of institutional remedies mean (a) Seek relief and clarification from the Courts, (b) Engage the AFP, PNP on security issues based on community development principles, engage in confidence‐building programs, and (c) Work with the Commission of Human Rights to assist the State in promoting human rights.
Engaging stakeholders have three elements: Genuine attitude, Consistency of approach, Manage expectations.
The last three strategies:
His suggestions for government reforms that are doable in the short term, meaning no need for a new legislation and much less a take over of government by any bleeding heart group are…
Cool and doable suggestions. The Diwalwal anomaly — so many “small scale mining” and political fiefdoms engaged in gold mining, paying zero national tax, doing almost zero forest rehabilitation or near-zero mine tailing impoundment, etc. — is one clear example of the rule of men. Mining laws and regulations apply only to large-scale metallic mining but not to “small scale” mining.
Kori’s concluding notes:
Bad news — Mining will happen with or without government action. If not managed, can result to more issues.
Good news: (1) Pursuing a quality mining project even under the current weaknesses of governance institutions is feasible. (2) Governance reforms on-going are essential to providing a supporting environment for L-T mining development, and will provide clarity of rules and stability of fiscal regime, allow effective regulation that builds trust.
Amen to his conclusions.