Monday, September 13, 2004

Crisis Psychology

Crisis psychology

Updated 00:52am (Mla time) Sept 12, 2004
By Randy David
Inquirer News Service



Editor's Note: Published on page A15 of the September 12, 2004 issue of the Philippine Daily Inquirer


PRESIDENT Macapagal-Arroyo's dilemma was whether to acknowledge the full magnitude of the country's fiscal and debt crisis, or to continue her pre-election policy of finessing it by reducing the problem to a simple budget deficit.

Confronted by a paper from University of the Philippines economists, which showed that the country faced a serious fiscal and debt crisis in the next three years if nothing decisive was done, the President responded that we were already in the midst of the crisis. This admission puzzled even Ms Arroyo's own economic managers.

But it allowed her to do several things. Despite the risks of frightening investors and creditors, the acknowledgment of the crisis gave her the right to demand that Congress now focus on the urgent task of adopting the solutions she has proposed rather than on debating the causes of the crisis. But more than this, she saw in the crisis the opportunity to consolidate her hold on the presidency by dismissing lingering doubts about her electoral mandate as trivial distractions in a time that commands national unity.

When a family is hit by a crisis, its members feel morally obliged to set aside their bickerings so they may face their collective problems squarely. They rally around the head of the family, take orders without question, and agree to put the interests of the whole family ahead of their own. Ms Arroyo assumed the stance of a strong moral matriarch at her appearance before the Manila Overseas Press Club recently. She issued a stern warning: "If these vested interests believe they can destabilize or sabotage our efforts, they better think twice. Our people are behind me. I have their mandate, and I am here to serve that mandate for our nation's best interests."

The reference to "mandate" is interesting. I am sure she meant to say that, with the elections behind us, she was now ready to be a tough "non-political president." But ironically, the word "mandate" also instantly reactivated images of the dubious manner in which she was proclaimed winner in the last elections. This explains Sen. Nene Pimentel's caustic remark the other day: "The President's declaration that the country was in a fiscal crisis was nothing but a ploy to cover up her lack of mandate, as well as the illegal use of public funds for her election campaign and the massive electoral fraud committed by the administration."

Faced with a fiscal crisis, the nation now seems so far away from the defective electoral process that gave Ms Arroyo a new six-year mandate. The parallelism between the Philippine president and the US president is uncanny. The "crisis" is to Ms Arroyo what the "war" is to George W. Bush Jr.-a warrant to close ranks behind a strong president and a reason to be grateful that we have this president and not the other. This line makes people forget that this is the same president that brought them to where they are today-in our case, the very same one who, says Sen. Joker Arroyo, caused the government to lose money in order to be popular and incurred more debt for the country in three years than in all the preceding years under Ramos and Estrada.

It is not to say the fiscal crisis that the country faces today is not real. It is as real as the war that America has brought upon Iraq, upon the Islamic world, and upon itself. There is no question that national unity is important during such times. But it would be a tragedy to suspend one's critical faculties at a time when what is needed most is judgment. The war against the fiscal and debt crisis, like America's "war against terror," is being used to discredit all criticism and to secure a quick consensus around certain measures that will make the general public absorb all the burden created by the irresponsibility, corruption, and greed of a few. This kind of mass psychology exploits communal solidarity and feeds on public insecurity.

I have heard many middle class Filipinos say, "Thank God that at a time of economic hardship like this, we have a doctor of economics rather than an ignoramus at the nation's helm." The equivalent of this illusion in America today is "Thank God that at a time of war like this, we have a decisive president rather than a wimp at the nation's helm." The basis for such tacit faith is more imaginary than real. Both presidents are nothing but skillful role-players without any real experience. You feel like crying when you see how desperately people want to believe in their leaders.

That the country is in a serious fiscal and debt crisis can no longer be denied. Ms Arroyo and her allies tried to conceal this in the months before the elections. Now that the extent of this mess is slowly becoming clear, Ms Arroyo wants to end the debate and, in the name of communal patriotism, focus instead on the quick-fixes she is offering.

It's funny how Bush and Ms Arroyo are so alike. Bush wants to end the Iraq war by spending more for the war. Ms Arroyo wants to end the debt problem by borrowing more. Buried in the business pages the other day was the news that the Philippines has successfully raised another $1 billion to finance Napocor's debts by issuing sovereign bonds in the world market. The new IOUs consist of $300 million worth of bonds maturing in 2015, and another $700 million payable in 2025. My granddaughter Julia, who will be 25 years old by then, will be starting her own family saddled by this new debt, in addition to the old ones unpaid from the past. That's not funny.

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