“The more things change, the more they remain the same.”
With under a week before the presidential turnover, I thought we might reminisce about what we will “miss” from the outgoing Administration and what we might look forward to in the incoming one.
In the broad arc of history the Duterte presidency will be remembered for its War on Drugs, the scar it permanently inflicted on tens of thousands of marginalized families and its failure – admitted by PPRD himself – as an initiative that we were promised would be completed in six months. Today drugs are still the scourge they were in 2016.
Then there were the massive frauds in Philhealth, Pharmally, the over-pricing of medical equipment and so much more largely undocumented. No one has been criminally prosecuted.
There was some good news. Duterte single handedly handed Maria Ressa the Nobel Peace Prize, tax accusations and all.
The economic legacy of the Duterte Administration is mixed marred as it was by three years of COVID. Sonny Dominguez was the economic OIC even as he did not oversee the health restrictions that stifled the economy. With one hand behind his back Sonny had through COVID the delicate balance between holding the country’s finances in check and the need to keep the economy afloat and millions of Filipinos from hardship through direct fund support. Sonny leaned towards the former even as most countries chose the latter, to blow out their deficits on economic and humanitarian grounds. As a result and together with the IATF stranglehold, the Philippines underwent some of the worst economic and human suffering and is expected to be one of the last to recover among our neighbors. On the positive side we retained our investment grade rating despite more than doubling our sovereign debt. It was a tough call for Sonny, there was no correct answer to his policy dilemma. To his credit he held firm to his conservative fiscal beliefs in an environment he did not totally control.
Congress sought to reform our tax structure through TRAIN 1 & 2, CREATE and other acronyms. These lowered personal and corporate income taxes in an effort to promote local and foreign direct investments (FDIs). The timing of these measures is questionable and the DOF now argues for their reversal or deferral in the face of looming deficits. The tax cuts also did little to promote their stated purpose. JP Morgan cites the Philippines as the least attractive for FDIs among our neighbors and there is no visible new investment by local businessmen.
Duterte had other reforms like the Rice Tariffication law which replaced the quota system for importing rice with free market access and a 35% tariff. The result was to replace the corruption by quota holders with smuggling by the new private importers proving the problem is not in policy or the law but in their execution.
The President eased foreign ownership in strategically important areas like telecommunications, shipping and aviation. The employment impact of this initiative is arguable while potentially ceding control of our vital infrastructure and transportation industries to possibly unfriendly foreigners; thus adding to our other national security concerns like the West Philippine Seas and looming food shortages. As a nation we have undressed ourselves to the world without even having been or ever being paid for our services.
Despite the sins and omissions, President Duterte will end with a high popular note. This is tribute to his charisma and the nation’s desire for strong leadership. The latter will not be lost on the new President.
What can we look forward to in the new Administration? “Looking forward” may be somewhat strong an expression given how little we are told of what to expect other than the usual testaments to unity, hitting the ground running and such. With a mandate from 31 million Filipinos and an unprecedented majority vote, it is remarkable how little excitement there is in the air for the new Government. Certainly there is not the buzz that accompanied the Cory, Noynoy and even Duterte’s ascension into power. But who knows we might still be blown away by BBM’s Inaugural Address on June 30 at the National Museum.
BBM and his family will be settling in for a long stay in Malacanang. He is starting with a record political capital which he must dispense judiciously in the battle against the forces of social unease. The first priority is to prevent the economy from stalling.
Fiscally the new Government is inheriting a ton of debt and an economy nominally recovering but now facing severe headwinds in inflation, rising interest rates, potential food shortages and slowing world growth. The peso is around 54.50/USD from 50/USD not so long ago; and dropping. The situation could have been worse had Sec. Dominguez let go of the financial spigot. The incoming DOF Sec. Diokno, a protege of Sonny in the BSP, has said our finances are “easily manageable” but then he did have to say that.
BBM is not prone to the hyperbole and sensationalism of his predecessor nor does he command high prose. He is disciplined and business-like in his messaging which accounts for the absence of anticipation to his presidency. Going forward I expect Malacanang pronouncements will be measured and on a need-to-know basis. It will be a closed and stealth presidency. It is management by memo, not a continuing discourse with the public as with PPRD’s weekly TV monologues. Like Teddy Roosevelt BBM prefers to speak softly but carry a big stick.
There is also no hint of a vision or a quantum change in direction for the country that will stir our hearts. BBM is ideologically conservative. This is reflected in his economic team which while competent represents just more of the same. The plus side of this is his Administration will be predictable if possibly boring but boring is good if it means dispensing with the jet skis to the Spratleys and just getting down to work and delivering on the promises to the people.
We see signs of this in BBM’s decision to appoint himself concurrently as Secretary of the Dept. of Agriculture. The new President has the courage and conviction to be accountable for a sector that has been paid lip service in the last 30 years yet has lagged behind others. With BBM in charge agriculture will finally be given the budget, executive and local Government attention it deserves. Bravo, Sir.
In terms of social justice we see the BBM Government as right wing. This is reflected in his choice of DOJ Secretary Boying Remulla. It would be a mistake if this should translate to an attack on human rights activists, food kitchens and online news services as Commies existentially threatening our Republic. Our Communists are outlaws posing as an ideology that has been abandoned even by Russia and China. Communists are invariably hauled out as a national security threat by Governments in need of a distraction and by the military in need of a budget. With 31 million in political capital BBM does not need this bogeyman. If he wants to truly eradicate the Left his best weapon is to improve the economic plight of the poor.
An unanswered question will be what will the incoming Government do about the sins of the outgoing one, specifically whether certain high officials will be held accountable for their crimes in the DOH and other agencies. Sara would have an interest in this since they were her nemesis and arguably influenced her decision not to run for what was a sure presidency at the time. Will she press BBM to live up to what could have been a condition of their partnership? What BBM finally decides will tell us much about how accountable he will be in his term.
At the risk of being stoned by the Pinks I wish BBM’s presidency well for the sake of the nation. He is cognizant of the legacy he bears and hopefully of that he will leave behind. He will thread gingerly at least until he secures his footing knowing the world is watching. This is good for the beneficiaries of the status quo, less so for those seeking major changes in our culture, values and economic inequality.