Unsettled

See what happens when you open your mouth without understanding what you’re saying. You could be saying yes to rape, or you could rattle the markets by hinting at debt repudiation.

And to think opposition presidential candidate Fernando Poe Jr. was often spotted nodding off or doodling at a forum last Tuesday with business leaders where he talked about debt restructuring. The candidate was probably dead tired from barnstorming. And who wouldn’t nod off when the topic is debt management? Only economic analysts, and even they don’t have all the answers to our massive problems.

With less than two months left to election day, President Arroyo’s rivals aren’t worrying too much about the impact of their pronouncements on the nation. Why, it could even work in their favor if the economy collapses before May 10 and the peso becomes Mickey Mouse money, because such developments will be blamed on the President.

So who cares about Standard & Poor’s or Fitch Ratings? The only ratings the candidates are watching are those polled by Social Weather Stations and Pulse Asia. And those numbers are worrisome for the President’s rivals.

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That a statement from Poe elicited such a reaction from the market indicates that he is still seen as a likely winner in May despite the latest surveys.

Poe’s economic advisers better give him a crash course on getting to know Fitch and Standard & Poor’s. His handlers insist Poe is a quick study, so someone should also tell him about Brazil and the financial panic leading up to the election of Luis Inacio Lula da Silva as president on Oct. 27, 2002. The popular candidate of the left-wing Workers’ Party won the elections by a landslide. But in the six months to the elections, the Brazilian currency, already weakened by financial contagion from Argentina, further shed its value while the Sao Paulo stock index plunged.

All because the markets, cowardly even under normal circumstances, were worried about Lula’s previous pronouncements in support of debt repudiation.

Lula’s predecessor, Fernando Henrique Cardoso, had accumulated a massive public sector debt during his incumbency. Possible repudiation by Brazil rattled sectors that were already worried about debt service in emerging markets.

Servicing a trillion-peso debt could require certain bitter pills — medicine that only a popular president who is no longer standing for re-election can make the masses swallow. That was among the early pitches for Poe of those who pushed him to seek the presidency.

Instead what the credit rating agencies are hearing is debt repudiation, despite clarifications from the Poe camp. Until yesterday the Bangko Sentral ng Pilipinas and Malacañang were still scrambling to reassure the markets that the nation intends to honor its debts.

If the markets are unsettled even with Poe slipping in the surveys, think of what will happen if he gets elected.

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To be fair, Poe is not the only candidate guilty of dangling such measures to voters. Raul Roco, who is supposed to know better, is wooing the squatter vote by promising a one-year moratorium on evictions. One day legislators will have to muster the political will to pass laws that will prohibit anyone without a fixed address from voting.

Yesterday Roco vowed to push through with the tax on text and use the revenues to build houses for the poor. He must have also been nodding off and doodling when he said that — too much heat and barnstorming can get to you. Or else no one has told him how many people have become addicted to text messaging in this country. Are there more squatters than cell phone users in these islands?

President Arroyo herself is governed in policy-making these days by what is popular. She puts her foot down on a request by jeepney operators for an increase of P1 in the minimum fare, worried that it could trigger inflation in the crucial weeks before the elections. She lifts the number-coding traffic scheme for buses on EDSA to blunt a similar demand for a fare increase, even if it means aggravating the traffic mess. Her administration leans on the oil companies to freeze fuel prices or cut diesel prices.

Certainly the public isn’t complaining – for now. But there’s a price to pay for such popular measures.

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For now you can almost see Gloria Macapagal-Arroyo the economist ticking off the numbers in her head: How many jeepney drivers and operators are there, compared to those who will be affected by inflation? How many supporters does her predecessor Joseph Estrada still have compared to the critics?

The President is ready to risk the ire of her original supporters by showing compassion toward Erap, short of admitting that she’s short-circuiting the judicial process. And she’s not going to change her stand now, what with the Iglesia ni Cristo and El Shaddai issuing a joint statement supporting the administration’s treatment of Erap.

Not saddled with being Erap’s bosom buddy, candidate GMA can show compassion toward him without raising suspicions, like Poe, that she intends to free Erap if she wins in May. And even if she forgets to consult her legal advisers again and promises Erap something that’s impossible under our laws in case she wins, she already has a track record for changing her mind and going back on her word.

Poe, on the other hand, can shout himself hoarse that he will let justice take its course in the case of his friend. But people will still suspect that if Poe wins, he will not just release his friend from detention but also move to clear the deposed president of all criminal charges.

Poe is in a quandary when it comes to his friend. You can’t campaign on a platform of transparency and good government when you are seen as a virtual brother to a man accused of plunder.

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Thus FPJ deems it prudent to keep his mouth shut in the case of his friend. Okay, FPJ’s mouth is often shut. But what, not even a public thank you for Erap’s public endorsement of FPJ’s presidential bid?

Erap will remain a hot potato for candidate FPJ, so expect Poe to stick to safer topics such as debt repudiation.