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Ethics: Black, White (or Gray)?

IN celebration of the Golden Jubilee Year of Financial Executives Institute of the Philippines, FINEX launched an ethics book entitled Ethics: Black White (or Gray)? which gathered essays and actual cases from 50 well-known personalities from the government, banking and private sectors.
Last May, Zondie Garcia, FINEX Ethics Committee Chair, asked me to sub-chair the committee of the Ethics book. I immediately accepted because I believe in the project, more so that conflict of interest as a topic was hugging the headlines at that time. Ethics, instead of being simply black (wrong) or white (right) was getting blurry or even gray. And so, an ethics book is relevant and timely.
The book has articles from the Bangko Sentral ng Pilipinas (BSP) — no less than BSP Governor Nestor Espenilla, Jr. (“Continuity Plus Plus: BSP’s Strategic and Ethical Bedrock”), Monetary Board Member Jun de Zuniga (“Rising Above Conflict of Interest”) and Deputy Governors Chuchi Fonacier (“Managing Conflict of Interest: Walking on a Thin Line”) and Diwa Guinigundo (“The Ethics of Being Ethical”); former Securities and Exchange Commission Chairs Tess Herbosa and Fe Barin; from the Institute of Corporate Directors, Dr. Jesus Estanislao who also wrote the preface, and Francis Estrada; from banks: Bankers Association of the Philippines President Nestor Tan, former BSP governor and Philtrust Head Jimmy Laya, ING Head Hans Sicat, Ding Pascual, RPT committee chair of PNB; FINEX members led by 2008 CFO of the year Baby Nuesa (“When Ethics Collide with Culture, We Must Rediscover Shame”); and SharePHIL Chair Evelyn Singson (“The Protection of Minority Shareholders’ Rights”).
Writers from the academe include Miriam President Charito Lapus, UA&P Professor Bernie Villegas and former UP president Fred Pascual; from the insurance industry, Allianz PNB Life President Olaf Kliesow and Sunlife’s Riza Mantaring (“When Doing Right by the Client Hurts”); from former government officials, Communications Secretary Sonny Coloma (“Is There a Right Time to be Ethical?”), Agriculture Secretary William Dar (Ethics and Agriculture — the Right to Food), former Finance Secretary and now Philippine Stock Exchange Chair Jose Pardo (“A Heart for Doing What is Right”).
As most articles were pretty serious, we also have an article from Laurie Jimenez (“When No One is Looking”), GMA 7 director, about when she was still in school and didn’t go with the flow of cheating. From the Filipina circle of CEOs, we have Carol Dominguez, social entrepreneurs Chit Juan (“Can You Do Business with the Poor and Get Rich?”) and Chiqui Escareal Go and accounting head Sharon Dayoan.
A section on the digital space titled Ethical Views on Technology was coordinated by Reynaldo C. Lugtu with articles from PLDT’s FINTQ Lito Villanueva (“Ethical Imperatives in Transformation”), Amihan’s Winston Damarillo, and Urban Chair Tito Ortiz, now a reinvented blockchain advocate. These are just some of the writers and more.
The Ethics book was launched at the BSP (thank you to our dear Governor Nesting!) with DG Chuchi Fonacier as guest speaker. Attendees were mainly the writers/contributors of the book.
Ethics: Black White (or Gray)? hopes that through the stories, examples, and experiences of the writers, it will be a good guide to all of us to decide on what is black or white, what is right or wrong, and not fall in the gray area.
The book, to be distributed to FINEX members and school partners, is dedicated “to everyone who wants to be ethical and do the right things right.”
Of the Ethics book, Dr. Jess Estanislao writes, “the battle for the observance of proper ethical standards is a continuing task of a lifetime. This volume is an invitation to bring integrity and ethics into our daily decisions and actions.”
Bro. Armin Luistro says: “During these turbulent times when our moral compass seems to be misled, the FINEX book on ethics is a must-read.”
 
Flor G. Tarriela is the Chairman of Philippine National Bank. She is former Undersecretary of Finance and the First Filipina Vice President of Citibank N.A. She is Go Negosyo 2018 Woman Intrapreneur Awardee. She is a FINEX Foundation Trustee and an Institute of Corporate Directors (ICD) Fellow.

Where is Dubai crude headed?

Where is Dubai crude headed?

How PSEi member stocks performed — October 18, 2018

Here’s a quick glance at how PSEi stocks fared on Thursday, October 18, 2018.

 
Philippine Stock Exchange’s most active stocks by value turnover — October 18, 2018

NFA import deals face rebid as sellers hold out

THE National Food Authority (NFA) awarded only three rice import contracts on Thursday accounting for 47,000 metric tons (MT), a small fraction of the 250,000 MT it was authorized to order, as most of the 14 bidders made offers far above the agency’s reference price.
Thai Capital Crops Co. Ltd. was awarded 18,000 MT at $426.30 per MT to be landed in Batangas. Vietnam Southern Food Corp. (Vinafood II) won the bid for 15,000 MT at $427.68 MT per MT, to be landed in Tabaco, Albay; and Vietnam Northern Food Corp. (Vinafood I) obtained an order for 14,000 MT at $427.50 per MT to be landed in Iloilo and Bacolod.
NFA’s reference price was $428.18 per MT, while most offers were at $458 to $478.48.
According to NFA Deputy Administrator Judy Carol L. Dansal, the agency will rebid the remaining contracts, subject to discussions by the governing NFA Council.
“We have to report to the Council to address this. We need rice and we need to act immediately. We will have to rebid for the remaining volume,” Ms. Dansal told reporters.
The government has authorized the import of 750,000 MT of rice this year in three batches of 250,000 MT to help bring down rice prices and after typhoon Ompong (international name: Mangkhut) damaged rice-producing areas in Regions I to IV-A and the Cordillera Administrative region.
“It is not a failed bidding. It’s just that not all the volume was taken,” Ms. Dansal said.
The NFA was allocated a total of P6.1 billion to procure 250,000 metric tons of rice earlier this year but in April it rejected bids from Vietnam for 50,000 metric tons of the 15%-broken variety $540/MT, and Thailand for 120,000 MT of 25% brokens at $530/MT.
The NFA reference price was $483.63 for 15% brokens, and $474.18 for 25% brokens.
The rejection of bids depleted the NFA rice inventory, emboldening sellers of more expensive commercial rice. Subsidized NFA rice is typically sold to poorer consumers in order to keep their expenditure on food under control.
Meanwhile, Agriculture Secretary Emmanuel F. Piñol announced that the suggested retail price (SRP) scheme for rice will be implemented by Oct. 23.
Mr. Piñol said 15% brokens will be capped at P40; 25% brokens at P37; domestic regular-milled rice P39; domestic well-milled at P44. The price for so-called premium rice is still under discussion while special rice will have no SRP.
“We really have to rationalize the whole thing and it is really for the protection of the consumers,” Mr. Piñol said.
“There will be no more use of Sinandomeng, no more Dinorado, no more Super Angelica,” according to Mr. Piñol, referring to some names of rice varieties on sale.
An SRP on chicken and pork is also expected to be imposed, but remains under discussion.
“The standard will be farmgate price plus P70 for pork regular cut,” according to Chester Warren Y. Tan, chairman and president of the National Federation of Hog Farmers Inc (NFHFI), noting that the SRP for choice cuts will be determined on Friday.
“The implementation will follow after we agreed to one common SRP to regular cut and choice cut. DA and private sector will also have a meeting with DTI (Department of Trade and Industry) for finalization,” Mr. Tan added.
United Broiler Raisers Association (UBRA) President Elias Jose M. Inciong said: “Our position is farmgate plus P50. It may be implemented next week.”
Chicken farmgate prices currently range from P77 to P84. — Reicelene Joy N. Ignacio

BoI-registered investments rise 19% in first 9 months

PROPOSED projects registered with the Board of Investments (BoI) were up 19% in the first nine months, led by energy projects, Trade Secretary and BoI Chairman Ramon M. Lopez said in a statement on Thursday.
BoI-registered investment during the period totaled P455 billion, against P381 billion a year earlier.
Mr. Lopez said the investment climate received a boost from the upcoming release of the implementing rules and regulations (IRR) for the expanded Ease of Doing Business Act of 2018 and investment road shows in support of the Strategic Investment Priorities Plan (SIPP).
Power projects accounted for P168 billion, up 49% from a year earlier.
Manufacturing followed with P104 billion, up from P36 billion a year earlier.
Transport and logistics projects accounted for P102 billion, up from P15 billion previously.
“Investor confidence in the country remains high. The Philippines continues to attract more investments because the economy is strong enough to withstand challenges on both the domestic and international fronts,” Mr. Lopez said.
The BoI said it remains confident it will achieve its target of 10% investment growth after a record 2017.
“After the record-breaking investment approval figure of P617 billion in 2017, the agency is still pretty confident of hitting its investment target of P680 billion for this year,” Mr. Lopez said.
He added that September investment pledges are at two-thirds of the 2018 target “and the rest of the year should be pretty exciting and challenging due to the deluge of big projects in the pipeline.”
Another measure of investment, foreign direct investment, totaled P37 billion during the period, up from P12.5 billion a year earlier.
The British Virgin Islands accounted for P15.2 billion of the total. This was followed by Indonesia at P6.4 billion; Malaysia, P2.9 billion; Japan, P2.6 billion; and China, P1 billion.
“Our FDIs are clearly feeding off on the momentum of actual FDIs as monitored by the Bangko Sentral ng Pilipinas (BSP),” Undersecretary and BoI Managing Head Ceferino S. Rodolfo.
According to the BSP, actual FDI totaled $6.7 billion in the seven months to July up, 52% from a year earlier.
Pulangi Hydro Power Corp.’s P38 billion project proposal led the power sector. It involves the construction of a 250-megawatt hydroelectric power plant in Bukidnon.
The manufacturing sector’s totals were boosted by Petron Corp.’s P82 billion investment in a condensate processing complex at its refinery in Limay, Bataan. Another major project is the P62.6 billion Liquefied National Gas terminal project of FGEN LNG Corp. in Batangas City with a capacity of 5 million tons per year.
Other manufacturing projects include Bio Renewable Energy Ventures’ P1.8 billion coconut methyl ester and glycerin facility in Misamis Oriental; Biotech Farms, Inc.’s P151 million fiber egg tray project in South Cotabato; and Conibo Organics, Inc.’s P60 million coconut coir project in Camarines Sur.
Totals for the transportation and logistics segment were boosted by Philippine Airlines, Inc.’s purchase of six Airbus A321NEO aircraft worth P19 billion.
The P11.8 billion investment of Cebu Air, Inc. also invested P11.8 billion for five Airbus A321NEOs.
Meanwhile, new hospitals and expansions received strong investment “on the back of strong wellness demand in the provinces.”
Among these are Allegiant Regional Care Hospitals, Inc.’s new P710 million facility in Lapu-Lapu City; Allied Care Experts (ACE) Medical Center’s new P1 billion hospital in Bohol; Healthcaremax Inc.’s P658 hospital unit in Batangas; and Good Shepherd Hospital’s P362 million project to expand its hospital in Panabo City, Davao del Norte.
Central Luzon accounted for P163 billion worth of investment during the period. Calabarzon (Cavite, Laguna, Batangas, Rizal and Quezon) followed with P126.3 billion and the National Capital Region was third with P61 billion. — Janina C. Lim

Suspension of fuel excise hike still on, but doubts creep in

THE GOVERNMENT will continue with its plan to suspend the scheduled increase in the fuel excise tax in 2019, the Department of Finance (DoF) said, although volatility in the oil futures market is strengthening the hand of officials who want the tax increase to go ahead.
Tax reform legislation permits the suspension of the fuel excise tax hike if Dubai crude, the price benchmark for Asia, averages $80 per barrel or higher for three months.
The benchmark was exceeded starting late September, prompting the government to call for the suspension of the increase even before the three-month trigger period, an indication that it was under pressure to act on rising inflation. Since the suspension was first proposed, futures contracts for Dubai, crude, the benchmark for Asia, have occasionally dipped below the $80 level.
The DoF presented data on Wednesday showing the Dubai futures contracts for November and December delivery falling below $80 per barrel, an indicator of possible price trends for the commodity. The spot price was above $80 at mid-October.
Socioeconomic Planning Secretary Ernesto M. Pernia said on Thursday that in light of the price movements, economic managers are now looking to review the decision to suspend the fuel tax hike.
“Maybe it’s better if we don’t suspend it. We really have to study it seriously first,” he told reporters in a chance interview on Thursday in Manila when asked whether the government will rethink its decision.
“We’ll talk about it,” he said.
Finance Assistant Secretary Antonio G. Lambino II said on Thursday that the decision still stands, although Malacañang has yet to announce the suspension formally.
“The recommendation to suspend stands. We are anticipating a formal announcement from OP (Office of the President). The review will happen at some point next year after the suspension is implemented,” he said in a mobile phone message
Republic Act No. 10963, or the Tax Reform for Acceleration and Inclusion Act (TRAIN), which took effect in January, raised fuel excise taxes by P2.50 per liter this year and is scheduled to add P2/liter and P1.50/liter in 2019 and 2020, respectively, totaling P6/liter. — Elijah Joseph C. Tubayan

DoF says profitable firms enjoyed P86B worth of incentives in 2015

THE Department of Finance (DoF) said profitable companies availed of tax incentives worth P86.3 billion in 2015 while smaller companies paid the full 30% corporate income tax, as the department built its case for rationalizing incentives as proposed in pending legislation.
The DoF said companies that received a total of P86.3-billion worth of tax incentives in 2015 also paid out dividends worth P141.8 billion to their shareholders, based on data from the Securities and Exchange Commission (SEC) and the various investment promotion agencies (IPAs).
“This means that while SMEs (small and medium enterprises), which employ about 65% of Filipino workers in the country, have to pay the steep CIT of 30%, the favored big corporations get sizeable tax breaks that enable them to award huge dividends to their stockholders,” Finance Undersecretary Karl Kendrick T. Chua said.
“Filipino taxpayers are, in effect, subsidizing the lion’s share of the profits earned by a select group of corporations that enjoy already redundant incentives under our convoluted CIT (corporate income tax) system,” he added.
“Such data showing that certain enterprises declared dividends that are way above the incentives they receive from the government prove that many of them are inherently profitable and no longer need such perks for their businesses to prosper here in the Philippines,” he said.
The DoF said in a statement that about 90,000 small and medium-scale enterprises (SMEs) and hundreds of thousands micro enterprises pay the 30% corporate tax rate, which is the highest in Southeast Asia.
It noted that SMEs in the services sector received P31 billion in income tax incentives but only paid out P47 billion in dividends to their shareholders during the same period.
The DoF said that about 645 registered enterprises continue to receive tax incentives after more than 15 years, “proving that investment perks given usually to big or multinational firms — many of them are inherently profitable — have become redundant and unnecessary.”
The DoF is backing the Tax Reform for Attracting Better and High-quality Opportunities (TRABAHO) bill, which rationalizes the incentives regime. It was approved by the lower House on final reading on Sept. 10 but pending at committee-level in the Senate.
The bill seeks to cut the corporate income tax rate gradually to 20% by 2029 via a two-percentage-point reduction every other year starting 2021.
Fiscal incentives will be limited to industries identified in the Strategic Investments Priority Plan (SIPP) and will make them subject to performance benchmarks. Incentives will be harmonized into a single menu, including: a three-year income tax holiday, after which, a special net income tax rate of 17% will be charged starting 2021; deductions for labor, research and development, training, and infrastructure development expenses; and some customs duty exemptions for up to five years. Following this, companies will be taxed at the prevailing corporate tax rate.
Currently, income tax holidays can be as long as nine years, with locators enjoying a 5% tax on gross income earned in lieu of all other taxes in perpetuity.
The DoF said that only 43% of the firms registered with IPAs are “worthy” of receiving tax incentives.
In 2016, the government estimates P178.56 billion in forgone revenue from tax incentives given out to 3,102 firms registered with various IPAs, according to the DoF, a total which is expected to rise 9.77% to P196.02 billion in 2017. — Elijah Joseph C. Tubayan

LGUs need upgraded technical skills to fight climate change — professor

SCIENTIFIC proficiency at the local government unit (LGU) level is required to help them deal with climate change, an academic said.
In a presentation at the 6th Asia-Pacific Climate Change Adaptation Forum held at the Asian Development Bank on Wednesday, Juan M. Pulhin, a professor and former dean of the University of the Philippines Los Baños (UPLB) College of Forestry and Natural Resources, said LGUs need to be capable of employing technology to come up with proper assessments in their jurisdictions.
“Science has the ability to look forward which may be beyond the local knowledge experience. The challenge is how integrate science tools and local knowledge to improve assessments,” Mr. Pulhin said.
“The LGU is at the forefront in battling climate change at the local level. They’re the intermediary between the national government on one hand and the community on the other,” according to Mr. Pulhin.
In an interview with BusinessWorld, Mr. Pulhin said capacity development should be implemented in all LGUs by giving technical training and increasing the number of specialist staff among the LGU’s regular job holders.
“On one hand, we have to use science, and some of our LGUs are not really trained on that aspect… At the same time, you also have to integrate it with local knowledge and experience and again some of our LGUs do not have the capacity to do that,” Mr. Pulhin said.
Mr. Pulhin said continuous capacity development among LGUs is needed to keep up with scientific developments to help LGUs assess their vulnerability to drought and flooding.
“Even more advanced LGUs need some capacity development because climate change is also a moving target and there are a lot of developments on the science aspect. There has to be continuous capacity development among LGUs in terms of assessing what we call risk and vulnerability,” Mr. Pulhin said.
“A concerted effort is needed at the barangay level. The challenge for LGUs, in addition to funding, is human resources. Many of them are very limited and they are performing many tasks,” Mr. Pulhin said.
Asked to comment on the deadly landslide in Itogon, Benguet in September, Mr. Pulhin said LGUs should be able to come up with a plan for the “new normal” of climate-triggered calamities.
“In Itogon, they said there were no landslides in that area for some time, and then suddenly we had continuous rainfall, which reached saturation point. We are now living with what we call the new normal, and that is climate variability. We should always plan for a new normal which is a departure from business as usual,” Mr. Pulhin said. — Reicelene Joy N. Ignacio

Hungary, PHL to hold first joint economic meeting in early 2019

DAVAO CITY — The governments of Hungary and the Philippines will hold the first meeting of their Joint Economic Committee (JEC) in the first half of 2019, according to Hungarian Deputy Chief of Mission David Ambrus.
Mr. Ambrus, who was recently in Davao for the opening of an Honorary Consulate in this city, said the JEC was established through the bilateral Agreement on Economic Cooperation (AEC) signed on March 28, 2017 and ratified by both sides.
Mindanao Honorary Consul Mary Ann M. Montemayor said the Davao office indicates the southern island’s role in the economic cooperation of both countries.
“It is our ardent hope that Davao could provide valuable opportunities in deepening the economic engagement of Hungary in the country and develop a mutually rewarding partnership,” she said during the formal opening of the consulate.
Ms. Montemayor, a businesswoman from the food and indigenous crafts industries, said tourism will be one of the focus areas for cooperation.
“As a tourism practitioner, I take great joy in reporting to Ambassador Jozsef (Bencze). We look forward to exciting times in strengthening ties, facilitating trade, investment and goodwill between Hungary and Mindanao,” she said.
One group of around 40 from Davao will be visiting Hungary in April. Another group is being organized for October.
“As Davaoeños explore the charm of Hungary, we hope that a reciprocal visit could likewise be received by our city,” said Ms. Montemayor, president and general manager of Villa Margarita Catering Services and president and chief executive officer of Davao Ecocrafts Association.
She also serves as the Mindanao coordinator for the GO Negosyo program. — Maya M. Padillo

Party Loyalty?

The filing of certificates of candidacy for those aspiring to capture political seats in the 2019 midterm elections has just finished and as expected by most of the Filipino populace, the same names and faces surfaced. But the trouble is the usual confusion for those who have identified certain candidates with particular political parties and those they are allied with. The colors red, blue, orange and yellow have not emerged but a combination of everything and everyone — the usual list as they say.
This glaring phenomenon of political turncoatism has been a traditional hallmark for Philippine politics and governance. Once enemies, now friends. Once a family, now rabid competitors for power. This pattern of electoral behavior has been lingering for decades — from the American era up to the present. The switching from one political party to another, depending on who seats in the Palace, has been a legendary tale of old.
While numerous efforts have been exerted by well-meaning academics, NGOs, political strategists and even election watchdogs to educate, expose and transform this tradition of party-switching, the malaise remains. Because our voters are used to popularity-driven, personality and patronage-based politics, the culture of our political parties continues to further engender and perpetuate the same.
With no ideology, concrete action plan nor basic principles, these parties simply recruit those who they believe “will be winnable.” Worse, there is no clear coordination and cooperation between national and local-level supporters. Horse-trading is not frowned upon but encouraged under the mantle of “practical tactics.” Because of a sheer lack of an organizational framework, rules on recruitment of party members, paucity of mechanisms for dismissal or discipline and accountability for party assets and funds, there is no group or entity, at present, which can claim to be an honest-to-goodness, genuine political party.
What we have are “momentary” coalitions that serve only for the purpose of installing one or two stellar candidates in public office. Even the party-list system, which was envisioned to espouse particular causes and advocacies, has failed to become game-changers, as they were also gobbled up by the traditional politicos. Anyway, winning seems to be the ultimate goal. Or perhaps, the only goal.
This reality has been recognized by some proposed bills in the old and new congresses. But nothing spectacular has moved so far. So refreshing is the news that the Consultative Committee which drafted the new Federal Constitution included a new provision that prohibits turncoatism. The latest version was finalized on May 2, 2018. The suggested changes include prohibitions for candidates and party officials from shifting parties two years before and two years after an election and for members of a political party elected to public office from changing parties during their term. Violations will lead to cancellation of the parties’ registration and the violators shall lose the post to which they have been elected, cannot be appointed and barred from running again in the succeeding elections, among others. Based on recent pronouncements, it appears that even the Comelec has a role to play in ensuring that the political parties shall have a clear political platform and agenda.
If a prohibition against political switching becomes enshrined in the new Constitution, this is a significant step in changing the mindset of our current political players.
The road map for institutionalizing a more democratic, transparent, and competitive political party and electoral systems will pave the way for a more enlightened and discerning citizenry. They will vote on the basis of belief, principles and, hopefully, value-laden agenda. The party that wins will make both the winning candidates and voters proud of their choice. And the elected officials would be accountable to deliver the commitments that were offered by their political parties.
There lies, finally, the beauty in politics.
 
Ariel F. Nepomuceno is a management consultant on strategy and investment.

The passing of elite democracy

democracy
The filing of certificates of candidacy (COCs) by those running for the Senate ended two days ago on Oct. 17. As usual, the media focused their attention on high-profile and so-called “nuisance candidates.” But they failed to mention that the outcome of the May 2019 elections, particularly for the House of Representatives and the Senate, will be crucial to the survival of this rumored democracy.
At stake is the fate of the opposition indispensable to the imperative of frustrating the ruling regime’s authoritarian ambitions. The results of next year’s elections will either complete the destruction of the system of checks and balances on which it has been focused since day one of the six-year term it wants to extend beyond 2022, or strengthen opposition forces and influence in government enough to prevent the further abuse of executive power.
The first result would be another nail on the coffin of the protracted democratization process that began with the Revolution of 1896. The second could help enhance the quality of politics and governance that is sorely needed in a society once again trapped in another acute stage of the centuries-old Philippine crisis.
Only a government — if not the sum of it, at least some of its parts — capable of rational thought and intelligent planning can craft and implement the measures needed to address the multitude of problems the country is facing. But that has not happened, among other reasons, because the Duterte regime has so debased public discourse that its profanity, simple-minded solutions to complex problems, lawlessness and violence, non-accountability, and the demonization and dismissal of critical thought have dumbed down rather than enlightened what would otherwise have been the informed citizenry needed for the survival and development of any nation.
In keeping with its primitive concept of governance in which power has no purpose other than itself, the Duterte regime is fielding, and has encouraged, candidates whose election to the Senate is unlikely to raise the already basement-level quality of congressional deliberations. Their names are better forgotten, but they include a Duterte gofer who has been campaigning for months without any sense of propriety, and who, once in the Senate, is likely to be even more abusive. There is as well a throwback from the Stone Age who has no program of government other than his obsession with restoring the death penalty and lowering the age of criminal liability to nine years old, and who has practically admitted that he knows nothing about anything else.
As alarming as the possibility of their adding to the less than distinguished majority in the Senate already is, an alleged lawyer is also in the same company. One of his most violent advocacies is the total extermination of the entire Muslim community. In the aptly named Lower House, among the party-list candidates is one of the country’s leading purveyors of false information (“fake news”) online who has done more harm to the rational discussion of public issues than a roomful of cheap lawyers.
The continuing threat of despotic rule, the ongoing ruin of the system of checks and balances — and, overall, the urgent need for a semblance of intelligence in government — have driven a number of men and women who are committed to the defense of human rights, the rule of law, and the people’s welfare to declare their own candidacies. But because most of them don’t have the billions of pesos, the political machinery and the name-recall needed to win elections in this “democracy,” only a very few, if at all, are likely to emerge victorious in May, 2019.
Despite their many flaws, elections in this troubled land continue to be regarded by many as the sure signs that democracy is alive and well, despite the many threats posed to it by both past regimes and the current one. The unchallenged assumption is that the ultimate expression of the rule of the people — their supposed capacity to decide upon whom they have chosen to delegate their sovereign powers — is every three years revalidated through “fair” and “generally peaceful” elections in which “only” a few dozen people are killed.
The reality is far from the ideal. The people’s capacity to express their sovereign will is premised on both their freedom from fear and their being adequately informed. But Philippine elections have always been decided by money, intimidation, violence, and the command votes controlled by local warlords and political dynasties.
The information the voters receive — on the issues that confront the nation, the backgrounds and the track records of candidates, their platforms of government, if any — is either incomplete, inaccurate or distorted, thanks to, among other factors, a mass media system that thrives on revenues from political advertising every three years.
The capacity to pay for media exposure either through overt advertising or its less than evident versions, such as a candidate’s paying to be interviewed as part of a radio or television news program, and, in this Internet Age, the mobilization of an army of keyboard trolls, is of course premised on how limitless or minimal are a candidate’s campaign funds.
The result of this anomaly is evident in the election to office of those who have the money but who do not have the country and its people’s interests in mind, as well as the vision, wisdom, knowledge and skills public office demands. Instead of enabling anyone with these qualifications to be in government, every election has reinforced the dominance of the handful of families that have monopolized political power in this country since Commonwealth days.
If there is at all any democracy in these isles of contradictions, it is the elite kind in which only a few personalities and their families, although they speak and act in the people’s name, have the public visibility, the opportunity, and the means to win political power.
The phrase “elite democracy” sounds like an oxymoron, or a contradiction in terms. Democracy after all means the rule of the majority, while the word “elite” refers to the handful of men and women whose special attributes — whether in skills, knowledge, or, in the Philippine case, in wealth and power — make them dominant within a particular population.
Despite the seeming contradiction, however, the phrase aptly describes what has passed for democratic rule in this country from 1946 to 1972 and from 1986 to the present: it is the rule of the few rather than of the many.
As challenging as an election is to those aspirants for public office who do have a vision of an alternative state and society, it should nevertheless be an opportunity to enlighten citizens on their responsibilities, the governance issues that should concern them most, and the need to look beyond the dynasties for solutions.
Elections should also broaden the involvement of the citizenry in their own governance so as to change the rule of the political elite into the rule of the majority by putting in office those individuals who can truly represent them and fight for their rights and interests. But as limited as it already is, even Philippine elite democracy has been severely damaged over the last two years by a thoroughly reactionary regime focused on its total destruction through the elimination of all opposition. The elections of May 2019 can either help delay or halt its impending demise, or complete its transformation into something far worse: a de facto tyranny.
 
Luis V. Teodoro is on Facebook and Twitter (@luisteodoro). The views expressed in Vantage Point are his own and do not represent the views of the Center for Media Freedom and Responsibility.
www.luisteodoro.com

Kavanaugh and the welcome death of the ‘living constitution’

For progressives, Brett Kavanaugh’s true alleged sin is not sexual assault. Rather, were they sincere, his crime is actually much much more horrible: Kavanaugh is a lawyer who believes and upholds the textualist and originalist schools of constitutional interpretation.
In the Philippines, those terms may not be well known, at least when compared to their more fashionable foil, the “living constitution” theory, of which many of the Metro’s “prestigious” law schools adhere to.
Considering our constitutional system, this column (as well as the University of Asia and the Pacific’s law program) has vigorously sought to inform the Filipino public about originalism and textualism.
Actually, re-recognize.
For originalism/textualism was the norm, the “living constitution” being a mere 20th century creation by progressives to ram through their preferred policy agendas.
The difference, by the way, between textualism and originalism, although arguably in the same camp, is that the former seeks to understand the constitution through the ordinary meaning of the words, with the originalist arguing that “ordinary” meaning should be that at the time a constitution was enacted.
Progressives tend to adhere to the “living constitution” for tactical reasons: what they cannot push democratically in the legislature they can do so surreptitiously in the judiciary, unhampered by what actually a constitution says, as the words therein (they argue) should be interpreted as the times require.
Thus, for social issues like entitlement welfare, gay marriage, divorce, sexual orientation/gender identity (SOGI) “rights,” abortion, contraceptives — all of which are not mentioned either in the US or Philippine constitutions (except for the latter, which prohibits abortions), a democratically elected legislature has the discretion to reject such measures. Generally for the US Congress and definitely in the case of the Philippines (so far) that has been true. In which case, progressives then try to get around such by resorting to the courts.
But they can only do so if two things occur: a) the judges must vociferously adhere to “judicial activism,” and b) for that to happen, the “living constitution” theory must prevail.
Frankly, the confirmation of judges (and justices) should not be a matter of political spectacle. It’s a cut and dried matter, a selection of craftsmen. The judiciary, after all, does not make policy. They are only supposed to apply the law.
But because of the “living constitution” theory, gleefully taught here by activist law faculty and social justice lawyers, the judiciary has been transformed into a major political player, making the ideological leanings of the judge (or justice) to be relevant when it shouldn’t be.
Witness Kavanaugh’s confirmation: “The reason for these increasingly hard-fought and closely decided Supreme Court battles is that the last four nominees have been originalists and textualists who threaten the progressive doctrine of the Living Constitution. xxx Any restoration of constitutionalism and of the separation of powers depends on control of the Court.” (Check out Matthew Continetti, “The judicial wars are just getting started”; Free Beacon, October 2018.)
The weird thing is that (see for example Eric Posner’s analysis of Kavanaugh’s legal writings), there is really no evidence Kavanaugh is an originalist of the Scalia brand. Textualist, likely.
The other is that people equate originalism with conservatism, which is not necessarily accurate. Originalism is simply the honest read of a constitution as written. What is controlling is what the people actually wrote in the Constitution.
Many local pro-lifers enthusiastically cheered Kavanaugh believing he is an originalist and thus will automatically uphold pro-life advocacies. Which is not true. Were Kavanaugh truly an originalist, he will apply the US Constitution as written regardless of what the pro-lifers want.
In the case of the Philippines, for example, a textualist/originalist reading of the Philippine Constitution may very well likely support rulings in favor of:
Marcos’s burial in the Libingan ng mga Bayani;
Martial law in Mindanao;
Quo warranto as a proper mode of removal of a Supreme Court justice; and
Assertion of Philippine sovereignty over international organizations (e.g., the UN or ICC).
Gratifyingly, the textualist/originalist thought in constitutional interpretation has gathered force. The Philippine Judicial Academy recently witnessed a lecture by Dean Pacifico Agabin (Taking Text and Structure Seriously: Two Approaches To Constitutional Interpretation), where he stated that:
“It is submitted that the textual method should be the preferred approach to interpreting the Constitution aside from the fact that we are essentially a civil law country. Since our Constitution is only 31 years old, our Supreme Court has to abide by originalism, which specifies textualism and helps our Justices arrive at definite interpretations of the text even when it is ambiguous.”
This bodes well, not only for the legal profession but also for the Philippines. To paraphrase another great legal mind, Justice Florentino Feliciano, what we do not want is to “propel courts into the uncharted ocean of social and economic policy making.”
For that way lies judicial oligarchy, a violation of the separation of powers that our Constitution zealously protects.
 
Jemy Gatdula is a senior fellow of the Philippine Council for Foreign Relaions and a Philippine Judicial Academy law lecturer for constitutional philosophy and jurisprudence.
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