Yellow Pad

I address this to the pro-Duterte partisans and to President Rodrigo Duterte himself. I wonder whether President Duterte has weighed the costs and benefits of having Maria Lourdes Sereno removed as Supreme Court Chief Justice.

Methinks Chief Justice Sereno’s ouster is not for Duterte’s good. Why?

First, the impeachment trial puts on the back burner Duterte’s ambitious but promising legislative reform agenda. Second, it is likely that the Senate will clear, or not convict, Chief Justice Sereno. Third, even without Sereno, Duterte will not be better off.

The impeachment process is a distraction, in fact an impediment, to a legislative reform agenda that Duterte himself wants passed. Big progressive reforms have to be made — the Bangsamoro Basic Law (BBL), Universal Health Coverage (UHC), and the completion of the comprehensive tax reform package, to name a few.

These are reforms that will benefit the people. If passed under Duterte’s administration, they will become his legacy.

The said reforms are transformative, and their passage is absolutely necessary.

The BBL is the key to resolving the protracted armed conflict in Muslim Mindanao. Similarly, it is the institution that will effectively deter the alarming growth of terrorism disguised in religious fundamentalism in Mindanao. In addition, it provides the impetus for the rapid development and modernization not only of Muslim Mindanao but also of all Mindanao regions.

UHC is likewise a revolutionary reform.

As the authors in the House of Representatives wrote in their approved bill: “The State will adopt a whole-of-system, whole-of-government and whole-of society approach… for the universal health coverage.” This entails compulsory health insurance coverage of 100% of Filipinos. At present, coverage is 92%, and hence the challenge is to reach the so-called last mile. Health care benefits will be expanded, including for primary or preventive care (in the current system, the main beneficiaries are inpatients). And the value of health care benefits will increase, thus substantially reducing out-of-pocket expenses. The Senate has to act on this bill.

The comprehensive tax reform program remains incomplete.

What has been approved is the first package. Among others, it consists of the reduction of the individual income tax rates, the adjustment to inflation of the excise tax rates for oil, the lifting of many unnecessary exemptions on the value-added tax (or VAT), the increase in the excise tax for automobiles, and the introduction of an excise tax on sugar-sweetened beverages. But because of the compromises, some structural problems remain, and the revenue yield falls short of what government wants. Thus, the Executive is relentless in pursuing other tax measures.

Congress is set to tackle a second package of tax reforms.

It features the rationalization of fiscal incentives in tandem with the lowering of the corporate income tax and the further increase in alcohol and tobacco taxes. It goes without saying that this package is as equally challenging as the first.

However, the opportunity to pass the abovementioned reforms is narrow and limited. Political and economic analysts have observed that the passage of critical but hard reforms has to be done in the first half of any administration’s term. This is when the administration’s political capital remains relatively high and when the election-related issues do not hobble politicians. In the concrete, that means the critical legislative reforms must be secured in 2018. Their passage in an election year (2019) or in a more politically difficult second-half of Duterte’s term gets dimmer.

But having given priority to the Sereno impeachment, the Duterte administration has in effect sidelined its legislative reform agenda.

Once the submissive House of Representatives impeaches the Chief Justice, the Senate will devote much of its time to the trial. In short, Senate is compelled to shelve what should be urgent bills.

Indeed, we have seen how slow Congress has been in tackling the key reforms. Congress is perhaps fettered by the political brouhaha. Or maybe, taking advantage of the political distraction, it has deliberately slowed down the reform process to favor vested interests. Nothing significant has happened on the crucial reforms enumerated above in the first quarter of 2018.

But the Duterte’s forces fear the defeat of the impeachment in the Senate. That will be a terrible political setback.

Although the Senate has accommodated the Executive, the fact remains that it is sensitive to public opinion and pressure. It is very hard to muster a two-third vote in the Senate to remove Chief Justice Sereno, especially when she is being tried for unimpeachable offenses. The indication of a weak impeachment complaint is that it has taken the House of Representatives a long time to vote on the complaint. It is aware of the likelihood that the Senate will reject the infirm case.

That has led ugly minds like Solicitor General Jose Calida to pursue other legal tactics like petitioning the Supreme Court for quo warranto. This gives the Supreme Court power to remove its Chief Justice. The legal profession, including the Integrated Bar of the Philippines, is opposed to Calida’s petition. In the words of the lawyer and Inquirer columnist Oscar Franklin Tan, “this is a flying kick in a boxing match.” It breaks all rules. It violates the Constitution.

To change the metaphor, this is letting the genie out of the bottle. It destroys the separation of powers and creates disequilibrium in government. Giving such power to the Supreme Court has serious negative consequences. The unintended consequences can likewise haunt the current members of the Court and Duterte himself.

The political crisis that it will trigger will spill over to the economy and investments.

Why then does Duterte have to play a high-risk game when he really gains nothing from removing Chief Justice Sereno? The presence of Sereno in the Supreme Court does not alter the fact that Duterte still controls the Supreme Court. Within the Supreme Court, Sereno is isolated. Sadly, even her allies like Senior Associate Justice Antonio Carpio and Associate Justice Marvic Leonen are critical of her.

The only payoff for Duterte is a delight that he has been able to remove a disobedient but politically harmless Chief Justice. But the costs are high for the institutions, for the people, and even for Duterte himself.


Filomeno S. Sta. Ana III coordinates the Action for Economic Reforms.