First 75 days

The first few weeks of Marcos II gave us reasons to feel hopeful. He appointed capable and respectable people to the most important positions in his Cabinet. Indeed, his Cabinet looked better than that of Duterte.

It helped, too, that his sister, Sen. Imee Marcos said something to the effect that their principal objective is to redeem the honor of their family name.

Pardon me for snickering. If only tigers can change their stripes, they may just surprise us and behave well enough to moderate expected greed or even better, just focus on fixing what’s wrong with the country.

On that score, there are a lot to fix. The country is in a mess. The succession of post-Edsa administrations not only neglected long festering social and economic problems, they also made a lot of things worse.

We are now facing shortages in sugar, salt, garlic, onion, and maybe soon, rice, because past presidents miserably failed to fix our agriculture.

So, as much as we should try to see a half full glass as Junior starts his term, we cannot escape from the reality that he is inheriting a mess and Junior is a typical Filipino politician.

If Junior wanted to start with a loud bang to serve notice he is different, he should have said something about letting Leila de Lima free and giving back the franchise of ABS-CBN. Those are two obvious political vendetta of his predecessor and he wouldn’t want those to taint him.

But as Teneo, a New York-based consultancy firm observed in a memo to their subscribers, Junior seems to be “showing some political risk-aversion early in his term.” While this could be simply the result of a new administration attempting to find its footing, it may also be a problematic sign…”

Could it be that Junior is incapable of going against powerful vested interests?

We will know soon enough, Teneo observed, “if the positive expectations for policymaking that were given a boost by the appointment of several technocrats to the Cabinet could be an overshoot.”

Unfortunately, Junior flunked his first test, sugar importation. It is a fairly simple domestic issue involving powerful politicians and vested interests.

The retail price of sugar has roughly doubled over the past year and independent agricultural experts warn of shortages by the fourth quarter. Junior appears to have caved to the powerful sugar lobby and their political allies, including the Senate President who protested the government’s planned importation.

A respected technocrat was sacked after he was accused of authorizing importation without Junior’s knowledge and consent. The technocrat denies that. He claimed Junior was in on the import decision all along until the Senate President stepped in.

For a while it seemed that ABS-CBN and Channel 5 received a green light from the new administration to jointly operate or they wouldn’t have boldly announced the deal. But the threat of a congressional investigation from Duterte minions in Congress led to the collapse of the investment agreement.

The attack was clearly political, but Junior avoided taking any position and missed a chance to strengthen his democratic credentials. Junior could have signaled that he was unwilling to allow politics to intervene in business affairs.

Since the Duterte minions threatened the related businesses of Channel 5, potential investors are on notice that political risk is ever present when doing business in our country. There goes our FDI dreams out the window!

Teneo also correctly observed that even as we are pinning a lot of hope on Junior’s economic team, his relationship with this group of technocrats is not yet clear. Worse, it was muddled quite a bit with the sacking of Agriculture Usec Leo Sebastian.

Will Junior listen to powerful vested interests over the advice of his technocrats? If so, there will be more uncertainty for businesses who are not well connected.

The sad fate of Usec Sebastian, the first technocrat to run afoul of a powerful politician, must have surely made the other technocrats in the Cabinet feel more insecure. For one, Sec. Arsi Balisacan, who is a noted agricultural economist, was eerily quiet on the sugar issue.

We may no longer depend on the technocrats to boldly take strong positions on critical issues. Decisions will be delayed as they wait for signals from Junior. And delays will cost the country dearly in this era of one crisis after another.

Hopefully, Teneo concludes, Junior will realize that yielding to his economic team on difficult issues will be his best option. “For now, however, this is more a hope rather than an expectation.”

Global Source, a New York-based think tank, told their subscribers that “the credibility of the new administration’s economic recovery program rests mainly on the good name of the economic managers.”

“Businessmen who have sat through presentations and meetings with senior officials of the new administration’s economic program have gone away satisfied with its coherence, adherence to market principles, and promise of returning the economy to its pre-pandemic growth path.”

Global Source, however, warned that “on the political front, the President’s seeming misstep in handling a major controversy in the agriculture sector, where he is serving concurrently as agriculture secretary and thus is in direct line of fire, is being closely watched as the possible canary in the coal mine of how he makes decisions in situations where narrow short-sighted political interest and broad public interest conflict.”

The success of Junior’s economic program, Global Source believes, also lies in the administration’s readiness to engage with the private sector

But there are inherited problems from Duterte in attracting the private sector to help via PPP projects. Junior has to overcome perceptions of regulatory inconsistency, crucial to these long-gestating projects that span several administrations, Global Source observed.

These are early days, but we are starting to see patterns and indicators of how the next six years will look like. We had our hopes somewhat higher than we expected in the first two weeks, only to be bashed over the last month.

Our situation today, to paraphrase a quote from Oscar Wilde is, we are all in the gutter, but some of us against our better judgment are desperately looking at the stars.

Boo Chanco’s email address is [email protected]. Follow him on Twitter @boochanco