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RONALD MENDOZA

[OPINION] Good policies, bad execution, worse timing

May 27, 2020

We economists could use some of the same philosophical grounding of medical practitioners: "First, do no harm." We often justify our policy interventions to respond to "market failures" which include those that weaken competition and hamper collective action. But there is also such a thing as "government failure," and Harvard economist Dani Rodrik once quipped that just because there's a market failure, it doesn't necessarily follow that we need to compound it with a government failure. As experts who try to safeguard the economic health of countries, we economists have to make sure we don't end up creating even more distortions through failed government policies. This is how I see the conundrum faced by the Duterte administration's economic team (or more precisely, what's left of it) and its continued dalliance with TRAIN 2.

CIELITO F. HABITO

NO FREE LUNCH: Where do college grads go?

May 26, 2020

Our high school graduates appear to be making the wrong choices on their college courses, as they pursue degrees that do not lead to high-paying jobs - and yet earnings are their expressed primary motivation for getting further education or training. This contradiction is among the findings of the latest Graduate Tracer Survey, the fourth done in the Philippines on record. Covering college graduates who completed their studies within 2009 to 2011, the results are reported in a paper by Melba Tutor, Aniceto Orbeta Jr., and James Matthew Miraflor released by the Philippine Institute for Development Studies last December. The study further affirms the widely observed jobs-education mismatch in our labor market, usually examined from the point of view of employers and higher education institutions, this time from the perspective of the learners. This perspective is important, the authors argue, because it is the student who chooses the school, course program, and occupation s/he pursues, and the one who experiences the consequences of these choices. More than her/his school, it is s/he who can judge the adequacy and appropriateness of training received based on actual employment experience. And more than the employer, it is s/he who knows her/his level of job satisfaction, and whether expectations motivating their studies have indeed been met.

JUAN MIGUEL LUZ

[ANALYSIS] Don't confuse schooling with learning

May 26, 2020

News item: Deputy Speaker Aurelio 'Dong' Gonzales Jr. filed House Resolution 876 which seeks to postpone the reopening of classes in public and private schools until a vaccine against COVID-19 is developed and made available in the country. In support of this, a partylist congressman said, "The Department of Education (DepED) should just postpone the entire school year without any exception. Our policy should apply to all to avoid any confusion. We are unprepared for this crisis." Then, in the late night weekly report to the nation on the emergency Bayanihan to Heal as One Act, the President said in a mix of English and Filipino: "It's useless to be talking about the opening of classes. Para sa akin, bakuna muna. Pag nandyan ang bakuna, okay na (For me, the vaccine first. If it's available, then it's OK [to open schools]). Remember that." Before our leaders take such drastic measures such as postponing the start of the basic education school year, let us put this coronavirus in proper perspective.

EDILBERTO C. DE JESUS

[OPINION] Balik Marawi, bago balik probinsiya

May 23, 2020

Keeping them in the relocation sites is the problem that has turned many such programs into wasteful, white elephants. Government would not have to risk this problem with a project to bring Marawi IDPs home. And it can serve as a pilot for BP2. The government has yet to end the IDPs' now three-year exile. To give them priority over any group wishing to avail of the BP2 program would be both rational and just. If the government cannot deliver on this project, what would be our basis to believe that it can effectively implement a much larger, more complex BP2 program?

CIELITO F. HABITO

NO FREE LUNCH: Creative tax adjustments

May 22, 2020

Governments are now out to find ways to revive their ailing economies in the wake of the pandemic. It's already a foregone conclusion that the second quarter will show dire economic numbers on the incomes and jobs front. If government statisticians were able to proceed with the regular April round of the quarterly Labor Force Survey in the midst of lockdown, a drastic jump in unemployment (from 5.3 percent last January) up to the double digits is quite likely. The sobering fact is that many of the local jobs frozen by the lockdown will not return beyond the pandemic. Restaurants are just one example where downscaling of the workforce will be inevitable. Many other types of business where physical distancing forces scaled-down operations will similarly let go of workers, if not close down altogether. On top of that, tens of thousands of our overseas workers are expected to return home, having lost their jobs in their similarly affected host economies. We need to protect existing jobs, but we must create even more for the substantial numbers of displaced workers as well.

CHING JORGE

Toward sustained citizen-led aid-giving

May 20, 2020

The collective effort of citizen-led initiatives to make aid and support move faster and bring assistance to those disadvantaged by the COVID-19 pandemic has been critical in providing the first wave of support needed by communities and hospitals. Online donation platforms have become notably successful, encouraging participation in community building efforts while under quarantine. In the private sector, a synergy of various companies has produced Project Ugnayan, which has raised over P1.5 billion. The leadership organization Kaya Natin, in support of the Office of the Vice President, has raised P60 million. The arts community-led Bayanihan Musikahan, with the PBSP, has raised close to P62 million. Church, alumni, university, and community initiatives have also contributed to fund-raising efforts.

CIELITO F. HABITO

NO FREE LUNCH: The national ID saga

May 19, 2020

One of the many changes the COVID-19 pandemic has brought forth seems to be a shift in general public sentiment toward the idea of a national identification card. It's been nearly two years since the Philippine Identification System Act (Republic Act No. 11055) finally gave the national ID the legislative mandate that had eluded it for decades. Even so, the system remains unimplemented, when it could have been extremely useful in facilitating delivery of targeted government assistance to Filipinos adversely affected by the near economic standstill prompted by the pandemic. There were speculations that this led to the departure of former socioeconomic planning secretary Ernesto Pernia, who chaired the interagency council tasked to coordinate and implement the system.

CIELITO F. HABITO

Paying for it all

May 15, 2020

Governments the world over are fighting both the public health and economic costs of the COVID-19 pandemic by literally pouring money on the problem. It matters little whether or not the money is available. Under the circumstances, the question is not "can we afford it?" but rather, "can we afford not to?" It's like rushing a critically ill family member to the hospital; whether or not you have the money for the hospital bills is something to worry about later. Governments have had to spend much money on virus testing kits, hospital supplies and equipment, quarantine facilities, and more. They've also needed to spend for social protection to forestall possible social unrest and public breakdown. Further on, the economic shutdown necessitates funding to keep the economy afloat, including possible large subsidies for industries flattened by the pandemic, such as in travel and tourism. All these add up to a massive drain on government finances. How are we paying for all this?

ZY-ZA SUZARA, RUPERT MANGILIT, JC PUNONGBAYAN, LUIS ABAD, AND LANI VILLANUEVA

[ANALYSIS] Why we can't Build, Build, Build our way out of this pandemic

May 14, 2020

This preference for infrastructure has invariably shaped the government's COVID-19 response. The economic managers are now cordoning off the infrastructure budget, saying it will be "the last item that we will touch." But can Build, Build, Build really help the economy bounce back quickly? We doubt it. Even before the pandemic, Build, Build, Build proceeded at a glacial pace and was not as growth-inducing as trumpeted by the economic managers. If key agencies - notably the Department of Public Works and Highways (DPWH) and the Department of Transportation (DOTr) - can't deliver Build, Build, Build projects in normal times, what more in a pandemic? We also fear that Build, Build, Build might end up as a patronage tool by local officials and become bloated by non-essential, non-strategic infrastructure projects.

RONALD U. MENDOZA

Fighting COVID-19 in the Philippines: The Scalpel vs the Axe

May 14, 2020

Early evidence suggests the world's leaders in fighting COVID-19 include countries like Taiwan, Vietnam, and South Korea, which effectively flattened the curve and managed to minimize the damage to their economies. The key ingredients to their success include agile test, trace, and treat systems to counter any flare ups; strong public-private partnerships in the health industry; effective application of technologies for information dissemination and contact tracing; and all this with less dependence on draconian lockdown measures. Some of these countries have also invested heavily in their respective health sectors, enabling them to rapidly realign and ramp up absorptive capacities should the need arise. Meanwhile, in countries like the Philippines, social distancing and lockdown policies are not nuanced because of incomplete data, and health and social protection systems are still underdeveloped and not totally inclusive. Hence it is not possible to use a "scalpel" (i.e. nuanced social distancing, selective quarantine, and other health policy responses that allow for many economic activities to continue) and instead countries with weak systems turned to an "axe" (lockdown). Also, compared to a country like Vietnam, which was decisive from the start, the Philippines belatedly severed its link to the main source of the disease (China). So it seems the Philippines ended up having to resort to a stronger lockdown when compared to other countries. Put differently, the economic cost of saving lives in the Philippines is high because it has weak systems and institutions, granting it little agility in its response options.