Good Governance Is Hard to Find

GOOD GOVERNANCE IS HARD TO FIND

OUR BIGGEST BLOCK

By: Cielito F. Habito - @inquirerdotnet

Philippine Daily Inquirer / 05:22 AM August 03, 2018

Politics is like cholesterol. It can be good or bad, but it’s the latter that gets all the attention because its effects are far more conspicuous and damaging. I have long been describing politics to be our national malady. With the way bad politics and bad politicians pervade in this country, “pestilence” may be the more proper term.

A recent Inquirer editorial concluded: “If the country doesn’t look out, politics may yet again prove to be the economy’s undoing.” It quoted Moody’s Investors Service in pointing to the administration’s push for federalism as a “downside risk” for the economy. Moody’s had added that President Duterte’s “contentious policies on law and order,” along with various political controversies, are harming the Philippines’ attractiveness to financial and real investors alike.

I’m often led to conclude that politics, especially the deeply divisive kind that our current leaders seem to be foisting on us on a daily basis, has been the greatest obstacle to strengthening our economy and building our national character. The political sideshow that accompanied the President’s recent State of the Nation Address put in stark focus the dark side of our politics, played out in a vital political institution by self-serving individuals claiming to be representatives of the people.

As I continue moving around Mindanao on work to track the economic outlook for the island region, I encounter much cynicism about its economic future in the face of the persistent prominence of politicians of the wrong kind. We’ve heard the typical stories time and again.

There are local chief executives whose first question to a would-be large investor in his municipality is “What’s in it for me?”—and throws hurdles in the latter’s way if the answer is not to their liking. There are those who demand having some stake in the business of the prospective investor. And there are those who systematically acquire businesses in their locality while in power, through means both fair and foul, and end up controlling most key businesses in the town or province by the time they complete the maximum three terms as chief executive. There are those who use the annual business permit renewal as leverage to extract favors from the firms they host, in the form of supply contracts, jobs for close relatives, cronies or friends, or, at worst, outright bribes masquerading as arbitrary and spurious fees and charges.

One dictionary defines politics as “the activities associated with the governance of a country or other geographical area, especially the debate or conflict among individuals or parties having or hoping to achieve power.” Politics need not be a bad word, then, the way it has come to be widely regarded. I remember how, as adviser to past presidential candidate Eddie Villanueva, I would hear him express the need to transform “politics” from being a bad word in the Filipino vocabulary, to one that carries a positive connotation.

What the country and its people have long needed is principled politics—the kind built on the principle that power is to be wielded in pursuit of the common good, and that power ultimately resides in the people, not in the leaders they vest with it.

We need political parties that are not mere labels and vehicles for self-serving politicians to attain and maintain power, but proponents of distinct and consistent principles and philosophies to guide our collective pursuit of the common good. We need a leader who can rally the people he serves in a unified pursuit of their shared ideals and aspirations—not one who imposes his peculiar preferences, prejudices and personality quirks in an errant pursuit of dubious goals.

Politics must complement sound economics, and not get in its way, toward uplifting the common good. It’s not the government structure that needs to change; rather, it’s our dysfunctional politicians and the bad politics they foster. Unless and until we have politicians who put the common good above self-gain, politics will remain our biggest block to creating far more jobs and livelihoods, and sustaining vibrant growth in an economy that draws from everyone’s energies and uplifts the wellbeing of all.

cielito.habito@gmail.com

Read more: http://opinion.inquirer.net/115082/our-biggest-block#ixzz5NpA4mZED

“Political economy” has been described by The Oxford Handbook of Political Economy (2008) as “interdisciplinary studies drawing upon economics, sociology and political science in explaining how political institutions, the political environment, and the economic system—capitalist, socialist, communist, or mixed—influence each other.”

It is distinguished from “economics,” which is the analysis of the economy absent from social and political considerations (to the extent that is at all possible).

We cannot separate the economic performance of the Philippines from the influence of political activity and systems and from issues of good governance. All are inextricably—even intimately—related.

DUTERTENOMICS IN PERSPECTIVE

By: Richard Heydarian - @inquirerdotnet

Philippine Daily Inquirer / 05:05 AM July 03, 2018

We live in interesting times. Over the past week, I have had the distinct privilege of having to respond to a relatively strident press release from the Department of Finance (DOF) on a recent article of mine published by the Tokyo-based Nikkei Asian Review (June 21).

Thus, my decision to dedicate this week’s article to the Philippine economy, postponing the second part of my planned articles discussing what I believe is lacking in Vice President Leni Robredo’s political narrative. The economy is also a timely topic as we enter the third year of Mr. Duterte’s presidency.

Surely, the economy isn’t in total “doldrums” (June 24), as President Duterte recently claimed. Our Gross Domestic Product (GDP) growth rate is well within the 6-7 percent target, making the Philippines among the faster-growing economies in the world. Our infrastructure spending as a percentage of GDP is set to breach the 5 percent milestone, a historic high. And revenue generation has also improved, as new tax measures gain pace.

But the overall story is a bit more complicated. In my June 21 piece, I raised concerns over the Philippine peso (weakest in nearly 12 years), rising inflation (breaching the 4 percent target of the government) widening current account deficit ($2.5 billion, highest in 18 years), and the drop in new foreign investment pledges (down by 51.8 percent in 2017 and 37.9 percent in first quarter of this year).

The DOF alleged that my piece was based on “generalizations [that] are erroneous and not backed up by accurate statistics.” Yet they didn’t rebut the veracity of even a single figure I used in my article.

All the figures and data used in my column were thoroughly fact-checked (anyone who writes for world-class publications should know this) and, crucially, are based on data provided by the Philippine government itself, namely the National Economic and Development Authority, Bangko Sentral ng Pilipinas (BSP), and Philippine Statistics Authority.

Interestingly, it was the DOF’s own statement that appears to have escaped proper fact-checking. It got the currency picture flatly wrong (Philippine peso was at P55.57/$US1 in 2003, not in 2013!). This was subsequently corrected, likely after I and others pointed it out to them on their website.

Gladly, however, some senior DOF technocrats reached out and shared alternative and additional data to me to pitch a more nuanced picture of the Philippine economy. Our economic managers gave the assurance that the inflation picture (average of 4.1 percent in first half of this year) is still manageable to below the 4-percent upper limit before the end of the year, despite the recent upsurge which had prompted new interest rate adjustments by the BSP.

Of course, I also agree that a weak currency has its advantages, that’s why mercantilist nations artificially and deliberately undervalue their currency. But, in the case of the Philippines, I would be glad to see how exactly this has helped our export sector, which has suffered four consecutive months of contraction this year so far.

Moreover, a weak currency raises the cost of food and energy imports as well as foreign-denominated debt. This, combined with new taxes, may partly explain our inflationary upsurge in recent months.

According to London-based BMI Research, “the Philippine peso continues to be the worst performing currency in the region,” while London-based Capital Economics has warned about a “big increase in inflation [f]ollowing the increase in taxes at the start of the year.”

The DOF is correct to highlight the increase in “approved” FDI recently, a record-high $10 billion in 2017 and growing by 44 percent in the first quarter of 2018. Yet, “pledges” of investments are also an important indicator of business confidence in the country; our officials, after all, make a big deal of it whenever President Duterte secures huge “pledges” of investments on his trips to China, Japan, South Korea, etc.

A weakening currency, rising inflation, the drop in investment pledges—all these can’t be explained by exogenous factors alone. So what explains these strains on our economy?

In its latest report, Capital Economics argued that “a longer term concern is Duterte’s erratic and crass leadership style, which is showing signs of putting off investors.” That’s an almost exact echo of the concern I raised in my Nikkei Asian Review article. I wonder if Capital Economics will receive a press release, too.

jrheydarian@gmail.com

Read more: http://opinion.inquirer.net/114328/dutertenomics-in-perspective#ixzz5NpB8KvgO

Question: “So what explains these strains on our economy?”

Answer: BAD GOVERNANCE

GRUMPY OLD MEN

By: Manuel L. Quezon III - @inquirerdotnet

Philippine Daily Inquirer / 05:26 AM July 11, 2018

The week began with an analysis in the Financial Times that says the peso is likely to weaken some more, with two trends contributing to this weakening. The first is a slowdown in the growth of remittances from abroad (remittances from the Middle East have actually been decreasing); and, second, a similar slowdown in the growth of the BPO sector.

A weaker peso also drives up the costs of manufacturing, affecting exports, while imports are expected to increase if government manages to embark on the infrastructure it’s promised, widening the trade gap. Companies that borrowed when the peso was stronger, and foreign currency cheaper, now have added interest costs. And if the central bank increases the cost of lending to counter inflation, there’s less credit to be had, slowing down business expansion.

The Financial Times analysis says rising prices has hit the poor the hardest, while the middle class has been “cushioned” from the effects of price increases due to the reduction in income tax under TRAIN 1. But if anecdotal evidence is any guide, talk in business circles of an increase in the repossession rate of cars suggests that this cushioning may be more theoretical than real. What is less a matter of conjecture and more of an observable trend is that investment pledges are down, as expansion plans or new projects are put on hold to see whether TRAIN 2 (which the business community seems to widely oppose, at least in terms of the components that would scrap investor incentives) pans out or not.

As it is, business, which had been interested in political proposals only to the extent that they help or hinder the economy, can’t be too happy about the consultative committee on Charter change appointed by the President. The committee essentially retained the economic provisions that business had wanted scrapped. Without any loosening of the economy, all a new constitution would signal to business is that, aside from the extortions of the national government and mulcting by the local government, a third level—the regions or federal states—would now enter the picture, eager to milk the already sore udders of businessmen large or small.

And this, in fact, is the realization that’s dawning on business people: Where formerly people could discount political risk because it was considered divorced from commercial risk, we’re sliding toward a lose-lose situation where political and commercial risks are increasing.

Over the past couple of years, there used to be a kind of conventional wisdom that was applicable to domestic events. However chaotic, crazy or disruptive the political players seemed to be, the economic managers, according to this conventional wisdom, were prudent, responsible and dedicated to continuity. In other words, this thinking went, the country had the best of both worlds: an administration whose president knew how to play to the gallery, thus maintaining national morale, but who had the fortuitous combination of ignorance and lack of interest in economic matters to leave well enough alone.

This belief began to be shaken when the President began using the economic team to help in his political agenda, and when the economic team incautiously used the President as a blunt instrument to accomplish its plans. Mighty, Mile Long, TRAIN, to name just a few incidents, might still be excusable, except success in these fronts seems to have fostered a sense of infallibility that began to manifest itself in what business considered weird behavior on the part of the economic managers.

A particularly disastrous performance—because unsettling, with its perceived petulance and angry old man unreasonableness—by the secretary of finance in Singapore, combined with similarly blithe, antique behavior on the part of the budget and economic planning secretaries, began to make businessmen think the conventional wisdom all along was wrong. The country is neither prudent, nor all that responsible, nor committed to continuity.

We’re entering uncharted waters, politically and, to a certain extent, economically, under increasingly erratic, geriatric command.

mlquezon3@gmail.com

Read more: http://opinion.inquirer.net/114528/grumpy-old-men#ixzz5NpC7cse6

IS KILLING PEOPLE AN ACCOMPLISHMENT?
By: Rufa Cagoco-Guiam - @inquirerdotnet
Philippine Daily Inquirer / 05:04 AM July 16, 2018

If so, then President Duterte and the people he has appointed to implement his war on drugs can rightly claim to have put up a stellar performance last year, which might even be surpassed this year. This deserves rousing applause if he lists this as his top accomplishment in his forthcoming State of the Nation Address this month.

As of Nov. 27, 2017, the Philippine National Police reported it had killed 3,967 drug “personalities” and arrested 118,287 individuals after conducting 79,193 “legitimate” antidrug operations. Human rights groups dispute this number; they put the number of extrajudicial killings in the name of the war on drugs to be at least six to seven times more than the PNP’s figures.

…From 2013, the allocation for so-called “confidential and intelligence funds” remained stable at only P500 million until the end of former president Noynoy Aquino’s term. But starting 2017, President Duterte was given a whopping P2.5 billion for the same purpose. In one year, the amount of “intelligence” funds Mr. Duterte’s administration spent was equivalent to what his predecessor spent in six years.

Trust is important in the use of such huge funds; the Commission on Audit cannot subject them to the same stringent scrutiny it applies to all other government expenditures.

…After the Marawi siege had dragged on for five months, government spokespersons reverted to a lame excuse—that there was a “failure of intelligence” in miscalculating the terrorists’ armed strength and geographical range.

So was the use of the “intelligence” funds intelligent, in the real sense of the word?

Killing people, many of whom may not be guilty of what they were suspected to be, is a distorted measure of performance or accomplishment, especially for an administration with such a huge “intelligence” budget. Maybe it is high time to rename the funds. That money could be better used to support serious, genuinely intelligent studies on why the number of people in the drug trade has not abated, and why there is terrorism in the first place.

Read more: http://opinion.inquirer.net/114631/killing-people-accomplishment#ixzz5Nqfne42j

MINDANAO’S STOCKHOLM SYNDROME

By: DLS Pineda - @inquirerdotnet

Philippine Daily Inquirer / 05:20 AM July 11, 2018

Signs seem to point to a looming nationwide martial law. Mayors are being shot in broad daylight; the inflation rate is at 5.2 percent; the Consultative Committee has turned in a draft charter that might, for its largely secretive and suspicious nature, only cause further disorder and alarm; and, ultimately, we still have a loose cannon for a President.

Ask, however, almost everyone here in Agusan, and they’ll tell you that there’s nothing wrong with martial law; in fact, it should be declared everywhere else in the country.

They’ll tell you it’s peaceful here. Fewer “tambays” and “adiks,” and more men in uniform. Mindanao, an island that, historically, has hardly felt the national government and has at some points even thought of breaking away from the country, has finally felt Manila showing it tough love with a declaration of an overstaying martial law. Pretty soon, Mindanao, sick with Stockholm syndrome, will be the first to support the President’s formal declaration of a nationwide martial law. It will pat Luzon and the Visayas on the back and say, “It’s gonna be okay.”

But the “peace” martial law has provided us is really no different from the “peace” we’ve had for quite some time now. The “lumad” remain under the close surveillance of the military and mining companies. The same swift and quiet silencing of opposition figures, dissenters and activists exists. It’s basically a rerun of the scenario of the poor getting poorer and the rich getting into office. Martial law hasn’t brought us the change our Davaoeño President promised.

…There are many things wrong with martial law here in Mindanao, but not many will—or can—talk about it. For a lot of us, it’s just that new checkpoint at the city border, or that spot inspection by men with guns who search your bag for whatever they might find suspicious. These are but minor inconveniences. But the opportunities that we no longer allow ourselves to take now are opportunities gone from us forever. It is through this fear that martial law reigns.

Many Manileños argue that, even without Duterte’s formal declaration of martial law over the entire Philippines, it’s already in place now. I differ—it will be worse. On our 408th day under martial law, I’ve realized how imprisoning it is, this imposition to say yes to whatever our government says. It’s a whole lot of fluff and much less talk, and, pretty soon, you’ll hear nothing from us.

DLS Pineda teaches at Father Saturnino Urios University, Butuan City. After finishing his undergraduate and master’s degree in UP Diliman, he decided to reside in his father’s hometown in Agusan del Norte.

Read more: http://opinion.inquirer.net/114522/mindanaos-stockholm-syndrome#ixzz5NqhNV1Xp

“Degrade the rule of law and reap the consequences of a lawless society.”

“Under a tyranny the law is misused as an instrument of injustice, persecution, repression, and oppression.”

“Correctly construed, the rule of law protects and upholds human rights and our God-given freedoms.”

“The rule of law creates, builds, and sustains just societies.”

“The law used to perpetrate crime and to sanction impunity for crime is the misrule of law.”

“The government that lacks transparency evades accountability and in all probability has something to hide.”

“Genuine democracy, which subsists in the democratic values and principles internalized by the people, is subverted when criminal leaders controvert the laws embodying the people’s deepest aspirations for freedom from tyranny.”

“A government of values and principles is degraded by a regime of patronage and corruption.”

“Populism is an incomplete and degenerate form of democracy.”

“Democracy is a work in progress, fascism a work in regress.”

“Good governance is hard to find.”

Link: https://poetryofgonzalinhodacosta.blogspot.com/2018/07/politics.html

Why can’t some people accept the fact that NOT ALL OF US Filipinos belong to the two tiny, self-centred camps of “Dilawan” and DDS. The vast majority of us Filipinos only want the best for our country, and couldn’t care less about your petty partisan politics.—Richard Heydarian, May 18, 2018

Link: https://twitter.com/richeydarian/status/997678182277959681?lang=en