Holy cows

At the Manila Overseas Press Club Forum yesterday, Finance Secretary Gary Teves, Trade Secretary Peter Favila, acting Internal Revenue Bureau chief Jojo Bunag and Customs Bureau head "Balong" Arevalo gave the kind of no-nonsense presentation of plans and programs meant to assure one and all that the government was not at all hobbled by GMA’s political crisis.

There is little question of their competence and professionalism. Nor can their sincerity and commitment to do good jobs be doubted. Gary and Balong have been in government service for a long time and have the rare distinction of being liked by both sides of the political fence, not because of acquired skills in boot or ass licking but because of their indubitable commitment to public service and the national interest.

Peter and Jojo cut their professional teeth in the private sector, Jojo as a respected legal practitioner and Peter in the banking and securities industries. Both emerged with enviable track records. None of these four can be said to be naïve about or unaware of the challenges they face in their respective new jobs.

Which was why I thought it was necessary to do a bit of a reality check on them. The assumption of most everyone, of course, is that our new economic managers will be able to conduct business as usual, or that the people they deal with, whether they be taxpayers, importers, foreign creditors and bondholders, or foreign investors, will be both supremely understanding and unfailingly supportive.

The implication is that everyone will pretend that the President’s current political crisis does not exist, or at least can be relegated to a somewhat minor irritation with no fundamental impact. Moreover, the thinking that a constitutional resolution is best, is indeed gaining ground. Hence, we still have the luxury of time or the "breathing room" to get needed reforms in place.

Some would even optimistically insist that GMA’s fate, whatever it may be, has been "discounted" by the market. Business leaders, in other words, have supposedy decided that their fortunes are not inextricably bound with the incumbent administration and that their time is therefore better spent looking out for themselves.

All of this is entirely possible, of course. But if you ask me, it is wishful thinking. Unfortunately for us, politics still drives many aspects of our national life, including, or most especially, our economy.

In raising this issue, I cited a Supreme Court Justice’s sage observation that the awful thing about the Damocles Sword is not that it falls but that it hangs. And, I usually add editorially, and hangs… and hangs. If we look at the current political environment, the dreaded Sword seems poised precisely above our collective heads.

There is no immediate resolution in sight, in view of the President’s refusal to resign. Many agree that impeachment is the proper remedy under the Constitution. If the House Justice Committee endorses the impeachment complaint to the full body, after finding the complaint sufficient in form and substance, one-third of the full House may then refer the complaint to the Senate for trial.

The time line in the Senate will then depend on how quickly the Senators can complete reception of evidence, both testimonial and documentary. No one I’ve talked to is prepared to put a deadline on when a decision one way or the other will be reached.

The other scenario is a short-cut where the objective will be to skip the House Committee on Justice and force the full House to immediately dismiss the impeachment complaint or refer it directly to the Senate. That will depend on the numbers. If the opposition has at least 79 votes, it will itself ask that the complaint be brought directly to the full House where, naturally, the endorsement to the Senate will be expedited.

If the opposition falls short of the required 79 votes for endorsement, then the majority will likely cause either a full but time-consuming discussion in the Committee on Justice before killing the complaint in the full House, or a direct referral to the full House for immediate extermination of the complaint. This will depend on the administration’s evaluation of whether immediate termination or a comprehensive discussion of the complaint’s sufficiency in both form and substance, is more politically palatable.

What does all this have to do with Teves, Favila, et al.? Well, remember the Damocles Sword. For as long as closure of the crisis is not obtained, it will hang. If an apparent closure is obtained, but is widely viewed to have been a whitewash, the Sword will drop a little but still hang. If the trial stage is reached in the impeachment process, the Sword will hang for an indefinite period.

While it hangs, will our economic management team be able to do what they know they have to do? Or will GMA’s survival mode so dominate as to render all other considerations, even economic survival, secondary? When the support of key players is assiduously sought, will compromises be made in economic and trade policy to promote business interests of those players?

Will revenue-raising measures be implemented, including EVAT, when in so doing, the President risks more public outcries by the long-suffering poor and a diminishing middle class? Will our national budget be diverted to ensure the pivotal votes of certain senators and congressmen?

Will Jojo Bunag be able to go hammer and tongs against tax evaders, a commitment that is on record, if the alleged evaders also happen to be among the most reliable contributors to campaign and "crisis management" coffers? Will Balong Arevalo keep his promise "to meet targets" if to keep them means he will have to go against known big-time but well-connected smugglers, those he calls not sacred cows but "holy cows?"

Before the MOPC members assembled and quite distinguished guests, all the new economic managers, particularly the strategically-situated Jojo and Balong, affirmed that they would rather resign than cave in to inappropriate political pressures. The gathering was suitably impressed and genuinely wished them well.

Several months from now, or earlier if rude lessons in political reality should intrude, we will know. By then, the Damocles Sword will either recede into mythology, or it will fall.