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Two Presidents, one GDP track

July 21, 2019


Benigno S. Aquino 3rd, when he was President, never appeared to be given to the idea of broadly-shared prosperity; his paeans to inclusive growth — a routine, insincere verbal scam.

When he set out on his grand agenda of sustained growth, all he minded was how to achieve increases in gross domestic product (GDP) at impressive rates — and sustain that over six years. In a sense, he was after a paper chase: nice growth charts.

If people’s lives on the margin were lifted up by the gains obtained from such growth trickling down, fine. If not, no single night of sound sleep would be lost. GDP growth for Mr. Aquino never implied across-the-board sharing of the gains. It was growth-for-growth’s sake.

He was truly an agnostic when it came to the impact of growth on human lives. His era of rising tides lifted the yacht owners and sank the rickety boats.

We all know what takes place under such environment of GDP growth pursuit. His growth charts were, indeed, impressive, but beneath the nice growth numbers was a dark story:

Capital sucked up most of the income gains; very little went to the labor component. The top 1 percent of the people vacuumed up an estimated 60 percent plus of the gains from sustained growth. The next 9 percent gained a substantial portion. The 90 percent had to make do with the crumbs.

After his term ended, Philippine society was transformed: the Aquino administration has created a class of dollar billionaires out of the traditionally wealthy. He just propped up the wealth of the traditional elite. The thin and fraying middle class was essentially the overseas Filipino workers (OFW) sector, which could not really function as the traditional political center because of its physical detachment. Then, below that — the massive, impoverished bottom.

There are ways to rein in such skewed trajectory of economic gains, which is not even rocket science. Mr. Aquino could have used the power of his office to do two things, starting with pre-redistribution — through forceful policies that would compel capital to share its enormous gains with labor. Acts like profit-sharing, participation of workers in the corporate boards, acts of noblesse oblige, which should have the force of law.

Then redistribution — such as soaking the rich in taxes to use the revenues for education and health programs for the poor, for infrastructure build-up, for the better and fairer administration of justice, and other acts of using revenues wisely to pull the vulnerable into the mainstream of society.

Mr. Aquino would have none of that. He cared for nothing beyond his nice growth charts.

Davao Mayor Rodrigo Duterte was swept to power in 2016 on the grand proposition that he would be the opposite, an anti-Aquino figure of sorts. That was to be on the backs of the voting masses disillusioned by the Social Darwinism of the Aquino administration.

Duterte’s promise to end the widespread problem of illegal drugs became secondary to his commitment to lift the lives and the lot of the underclass. It would not be a government with the kind of agnostic growth, but growth rates dedicated to easing the brutal wages of the Great Divide.

But even the grandest and loftiest of plans go awry. He compartmentalized his government. The drug war and the political components were his and his alone. His economic team took care of the economic component of his government. He left the economic side to the experts, but without the instructions to make growth and instrument of broadly shared prosperity. And there was a rub.

The economic managers of Mr. Duterte, with no exception, were aligned fully with Mr. Aquino’s growth-for-growth’s sake philosophy, which also rendered the underclass almost invisible. The same obsession with sustained GDP growth. The same deeply held belief that if GDP growth transformed the lives of the vulnerable, fine. If not, no one would lose a good night sleep.

If an imperative social program, like increasing the pay of public school teachers would get in the way of the promised fiscal soundless, kill it. Mr. Aquino vetoed the token Magna Carta for the

Poor on the ground that it would bust his beloved budget. Same here with the refusal of the Duterte economic managers to greenlight a small pay increase for the overburdened public school teachers.

The obsession with nice economic charts was on full display with the passage of the Rice Tariffication Law. It was a death sentence on 3 million small rice farmers. But Mr. Duterte went along with that policy because he had given his full support to his economic managers who were solely focused on a nice inflation figure.

We can say this again and again and again: You can replace the entire economic team of Mr. Aquino with Mr. Duterte’s own people and nothing would change. The same focus on growth, the same obsession with sustained GDP growth, the same agnosticism of their kind on growth, the same total lack of disregard on who gets the gains from years of sustained growth.

On July 22, Mr. Duterte would again address the nation. Take note of the portions that will be dedicated to the economy.

There would be token references to inclusive growth. But the part about “Build, Build, Build” as the pathway to game-changing growth will take centerstage. We all know what the program is all about — a giveaway to the country’s plutocrats.

Nothing has changed. The same obsession with GDP figures, the same focus on supposed fiscal probity, the same paper chase. Two Presidents, one economic track. Nothing for those who have been left behind.

Credit belongs to : www.manilatimes.net


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