We’re Going to Hell

WE’RE GOING TO HELL

ECONOMIC MANAGERS CITE RISKS OF FEDERALISM

By: Ben O. de Vera, DJ Yap - @inquirerdotnet

Philippine Daily Inquirer / 07:00 AM August 09, 2018

The Philippines’ investment grade credit ratings, which make it cheaper for the country to borrow money, will “go to hell” if the proposed shift to federalism proceeds, Finance Secretary Carlos Dominguez III told the Senate finance committee on Wednesday.

The shift will also be too costly for the government and may disrupt the economy’s growth momentum, Socioeconomic Planning Secretary Ernesto Pernia told the committee scrutinizing the government’s proposed P3.757-trillion  budget for 2019.

…Confusing fiscal provisions

Answering questions from senators on the committee, Dominguez said that instead of the ambitious “Build, Build, Build” infrastructure program going on full swing, the big-ticket projects in the pipeline may instead be “build minus three,” or derailed by federalism.

Dominguez said he was “very confused” with the fiscal provisions of the draft federal Constitution.

Under those provisions, which call for a 50-percent share of the regions from the national government’s revenue collections, Dominguez said the government may incur “a very large” budget deficit.

“So what will happen to our credit rating?” Sen. Ralph Recto asked.

“Oh, it will go to hell,” Dominguez replied.

“And when the credit rating goes to hell, what happens to the Philippines?” Recto asked.

“Everybody pays higher interest rates” of up to 600 basis points, or about 6 percent,  Dominguez answered.

Creditworthiness

Credit ratings are a measure of a country’s creditworthiness.

As the stability of state finances is also related to its performance, credit scores serve as a proxy grade for the economy.

Improved ratings allow the government to demand lower rates when it borrows from lenders and those rates translate into lower interest rates for consumers and businesses borrowing from banks using government-issued debt paper as benchmarks for their loans.

The Philippines currently enjoys investment grade ratings from the top three debt watchers—Moody’s Investors Service, Fitch Ratings and S&P Global Ratings.

Dominguez told the senators that during recent discussions, the major credit rating agencies expressed concern about the proposed shift to federalism, which they considered an “uncertainty” and a “political risk.”

“So there’s nothing to gain [from federalism], so to speak?” Recto asked.

“From that point of view, yes,” Dominguez replied.

Disruption of growth

As for the Duterte administration’s infrastructure program, Dominguez said it may be derailed by the shift to federalism.

Under the program, the government plans to roll out 75 flagship projects alongside spending up to P9 trillion on hard and modern infrastructure until 2022.

But the shift to federalism will directly cost the government P120 billion, not including costs such as disruption of government projects, Pernia told the committee.

“Our rough estimate in Neda [National Economic and Development Authority] is P120 billion but this is just the direct cost,” said Pernia, who is also the head of Neda.

The amount “does not include disruption to projects and other things that would be [taken into account],” he said. “Maybe our growth momentum will be disrupted also.”

Pernia’s estimate was more than double the figure given last month by Rosario Manasan, senior research fellow at the Philippine Institute for Development Studies, who calculated that the additional bureaucratic cost of the shift to federalism could reach P55 billion.

Breakdown of expenditures

Sen. Francis Escudero prodded Pernia, Dominguez and other economic managers to give a breakdown of the expected expenditures to be shouldered by the government should the shift to federalism happen.

Escudero said he wanted the matter clarified considering how the Senate was “being pushed and cajoled into discussing” the move to revise the 1987 Constitution for a change to federalism.

Dominguez said it was difficult to make calculations based only on the draft federal Charter.

“The draft, as it is right now, does not lend itself to financial analysis,” he said.

“I’ll give you an example: I sat with a member of the [consultative committee] and discussed how they see the national debt will be paid, as well as military, foreign affairs … they said, ‘Oh no, don’t worry about that. The split will be done after national expenses,’” Dominguez said.

“I said, ‘No, it’s not in the draft.’ How can we compute the costs? We don’t know what the final road maps are going to look like. I had a long discussion with them and I [was] more confused than when we started,” he said.

Not wise to prioritize

The reservations expressed by Pernia and Dominguez prompted Sen. Loren Legarda to say that it might not be a wise idea to prioritize the federalism proposal in the Senate.

“It’s clear: It’s confusing. There’s no need for more confusion in the country. We don’t need more confusion and chaos. We need order and progress, and jobs for people in the grass roots,” said Legarda, chair of the finance panel.

“But do we prioritize this? We don’t want to slow down projects,” she said.

Dominguez replied: “I agree.”

Legarda said: “We cannot confuse the people anymore. It’s a time for national unity and to surge ahead. When we use taxpayer money for information dissemination, we need a careful comprehensive study that derives respect from our constituents.”

Read more: http://newsinfo.inquirer.net/1019366/economic-managers-cite-risks-of-federalism#ixzz5PF0e2dlb

DUTERTE WANTS A SUCCESSOR TO PROTECT HIM ONCE OUT OF MALACAÑANG

Ellen T. Tordesillas

VERA Files

August 17, 2018

It’s easy to believe that President Duterte is tired and weary.

He is 73 years old and not the healthiest person on earth. The two years as chief executive of the country showed that he does not have what it takes to be a national leader.

But he will not resign. For the simple reason that he has to make sure that he doesn’t end up in jail for all the crimes that he would be charged with once he is out of power.

That’s why he wants to make sure that his successor is someone who will protect him. And that’s former Senator Ferdinand “Bongbong” Marcos or Sen. Francis Escudero for him.

http://verafiles.org/articles/duterte-wants-successor-protect-him-once-out-malacanang

THE WORST KIND OF CHARTER CHANGE

Bryan Dennis and Gabito Tiojanco

new mandala

24 August 2018

Constitutions live or die by their first few words.

“We, the sovereign Filipino people,” begins the 1987 Philippine Constitution. Whatsoever else comes after this assertion, the most important thing is that enough citizens believe it is true: that it is the People themselves who had promulgated or at least have accepted their own fundamental law. Without widespread faith in its sacred sanction, the Constitution becomes a standard script of political tragedy. Inevitably it would fail to constrain partisan politics and eventually become its plaything.

It is for this reason that the revision of the Philippine Constitution which Philippine President Rodrigo Duterte is now pushing for would be the worst kind of charter change.

Bruce Ackerman identifies three kinds of modern constitution-making. The first, revolutionary constitutionalism, happens when a broad coalition of government outsiders successfully mobilises to fundamentally alter the way things are—i.e., the status quo.

The second, insider constitutionalism, happens when government insiders effectively respond to wide-scale popular mobilisation by enacting the publicly-clamoured-for changes to the status quo themselves.

The third, elitist constitutionalism, happens when ascendant elites resort to constitution-making to either entrench a tenuous status quo, or make it even more favourable to them going forward.

Because either the catalyst or engine of the first two kinds of constitution-making is popular mobilisation, we can group them together as people-powered constitution-making. In contrast, little or no popular mobilisation motivates elitist constitutionalism; they are mostly if not entirely elite-driven.

The present push for charter change in the Philippines is a textbook example of elite constitutionalism.

…it is possible for an incumbent president to abusively brazen through a charter change which fundamentally changes the status quo. In fact, that is precisely what former Philippine President Ferdinand Marcos did in the 1970s to legalise his dictatorship.

Such brazening through is inherently unstable. The anti-Marcos struggle leading to the dictator’s overthrow in 1986 had dramatised this. Even if all groups were sincere in their commitment to constitutionalism, politics would remain unstable because such an imposed charter would likely bring about nagging disagreement regarding the fundamental norms which would be acceptable to most. Machiavelli had long ago warned that in such circumstances, force and cunning would displace civility and social norms. The brutality of the Marcos years is a cautionary tale of what often happens when this occurs.

…What makes the proposed charter even worse is that it seeks to replace a constitution which was a product of people-powered constitutional politics. As Dressel’s account of Thailand’s recent political history cautions, such an elite-driven revision of a people-powered constitution could facilitate a liberal democracy’s decay toward illiberal authoritarianism.

…The proposed federal charter, therefore, would only make the country’s presently resilient constitutionalism unstable. This risks turning Philippine politics into a populist playground.

http://www.newmandala.org/worst-kind-charter-change/

Duterte is stacking the Supreme Court in order to replace Leni Robredo with Bongbong Marcos in the position of Vice-President, a High Court outcome in the electoral contest case that Duterte seeks to protect himself from prosecution and conviction in case he has to step down in 2022.

Bongbong will possibly become president—Duterte will step down—and stack the administration with Bongbong henchmen, besides plundering the treasury and buying off—or killing and incarcerating—anyone who opposes the grand conspiracy.

Another reason for stacking the Supreme Court is to install the Federalism constitution in the instance that any case concerning it is brought before the High Court, which will also protect Duterte from prosecution and conviction because the new constitution will extend Duterte's hold on power, whether in the position of president or something else.

The quo warranto ruling illegally and unjustly removing the Chief Justice from her position is just another step in the undisguised plot to terrorize, plunder, and through dictatorial means decimate the nation.

***

“Wickedness will worsen when it is motivated by the underlying fear of retribution.”

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

“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.”

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

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