Jhe first lesson in economics is scarcity: there is never enough of anything to fully satisfy everyone who wants it. The first lesson of politics is to ignore the first lesson of economics. — Thomas Sowell, American economist, historian and social theorist
This article will quickly review some of the fiscal and economic performance of the three main presidential candidates in the upcoming elections on May 9 – Vice President Leni Robredo, former Senator Bongbong Marcos (BBM) and Mayor of Manila Isko Moreno. .
UPSE ALUMNI, STUDENT STATEMENT
Ms. Robredo graduated in 1986 from the University of the Philippines School of Economics (UPSE), before going into law. More than 400 of her fellow alumni and more than 150 students signed a manifesto expressing their support for her and her running mate Kiko Pangilinan for the vice presidency. The signature campaign was launched in early March and ended on March 31. Alumni range from batch 1968 to batch 2019.
The main reason given by the nearly 600 UPSE alumni and students for their support is that the Leni-Kiko pair is “subok na sa kakayanan in integridad in may track record. Yes VP Leni ay ekonomista at isang public interest lawyer…. Yes Kiko have abogado (UP Act lot 1993) to Batikang Senator (tested for competence and integrity and proven. VP Leni is an Economist and Public Interest Lawyer…Kiko is a Lawyer (UP Law batch 1993) and a seasoned Senator).
Vice President Leni has shown that having big agency budgets via big taxes and huge borrowing is no guarantee of real public service and improving the lives of ordinary Filipinos. The six-year budget (2017-2022) of the Office of the Vice President (OVP) was only P0.6-0.9 billion per year, still below P1B/year. The total budget for 2022 is 5 trillion pula, of which the PVO budget is only 0.71 billion pula, which is 0.0001 or 1% of 1%. So for every P100 of the total budget, the OVP budget is only P0.01 or 1 centavo. Compare that to the Office of the President (OP) budget of 8.24 billion pesos plus discretionary and intelligence funds and other offices of 65.1 billion pesos.
And yet Vice President Leni was able to inspire trust and transparency and attracted many private donations during the pandemic that enabled her office to provide PPE to many frontline health workers and COVID treatment kits to poor households.
In Table 1, Other Executive Offices (OEOs) under the OP include, but are not limited to, the Presidential Management Staff (PMS), the National Intelligence Coordination Agency (NICA), the National Security Council (NSC), and Office of the Presidential Adviser on the Peace Process (OPAPP).
THE FAILURE OF BBM AND PROGRAMS
Of public achievements over the past six years, BBM has virtually none. His own official website shows no private company involvement, no government positions, even as a consultant – 2016-2022 is empty. He has just spent the past six years campaigning and revising the history of the Philippines to say that the country had great economic performance, often referred to as “the golden years”, under his father’s presidency from 1966 to 1985.
So, in terms of achievements – zero. Yet he promises many social programs, bordering on socialism: 1.) free health insurance for all seniors, rich and poor; 2.) Subsidized food nationwide via permanent Kadiwa rolling stores in each barangay; 3.) free year-round EDSA Carousel rides; 4.) vaccination register and mass vaccination in each local government unit (LGU); and, 5.) energy rationing by killing all coal-fired power plants and using mostly renewable energy.
He and his running mate Sara Duterte also promise to pursue many of the current administration’s economic agendas. Well, the Philippines experienced a GDP contraction of -9.6% in 2020, the worst in Asia that year and the worst in Philippine economic history since post-World War II. Public debt has also increased significantly, from 8,220 billion pesos (real and guaranteed) in 2019 to 10,250 billion pesos in 2020, 12,150 billion pesos in 2021 and 12,510 pesos in February 2022. several taxes.
From 2016 to 2021, the Philippines had the lowest increase in per capita income among the ASEAN 6 – only 15%, while Vietnam had 37%, Singapore 28%, while Malaysia, Indonesia and Thailand had 19-22% (Table 2).
ISKO MORENO PASSING
While Vice President Leni’s office has an annual budget of only 0.6-0.9 billion pesos a year for the past six years, Isko Moreno, as mayor of Manila, has spent 30 billion pesos in 2021 and 71 billion pesos in 2022. He is the only mayor in the National Capital Region (NCR) to undertake annual, large-scale privatization of city assets. Here are the revenues or proceeds from the sale of city government assets: 90 million pesos in 2019, 4.936 billion pesos in 2020, 14.761 billion pesos in 2021 and 44.146 billion pesos in 2022.
So, with huge one-time revenues, he splurged on huge public spending. The final share of Manila city spending in the total RCN (16 cities and one municipality) increased from 10% in 2019 to 22% in 2022. (Table 3).
Let’s go back to the quote from Dr. Thomas Sowell. VP Leni is a public service practitioner with a very small budget and resources. BBM and Isko are the politicians who ignore the lesson of scarcity and simply spend huge sums or promise to spend on huge freebies. These spend-spend-spend politicians will also be the tax-tax-tax authoritarians when they splurge on public spending nationwide. Voters will take note of this when they vote in two weeks.
Bienvenido S. Oplas, Jr. is the president of Minimal Government Thinkers.