Fairyland all over again

Even from her sickbed, Gloria Arroyo doesn’t stop. The full-page ad boasting of her achievements does it all over again. She made similar preposterous claims in January last year and we destroyed them in an article entitled “Fairyland”. I guess we have to do it all over again.

But let’s start with the most basic: Honesty. Arroyo had 18 (that we counted) questionable deals under her term, four of them are now being investigated. Aquino has none, and doesn’t seem too likely to have them.

The high-profile scandals include:

• IMPSA extension (amount involved, $ 2 million)

• Megapacific -COMELEC poll modernization contract (P1.3 billion)

• Diosdado Macapagal Boulevard (P600 million)

• “Jose Pidal” ($200 million)

• Venable contract (contract designating a U.S. law firm to lobby in the United States government to release funds to finance Cha-Cha bid in the Philippines, $1million).

• Bolante Fertilizer fund (P728 million)

• Northrail project ($503 million)

• Southrail project ($70 million)

• “Hello Garci” (no less than our democracy at stake)

• Palace cash gift (alleged pay-off to LGU officials ranging from P200 thousand to P500 thousand each, reportedly to thwart the impeachment bid vs. Arroyo, P120 million)

• NBN-ZTE deal ($329 million)

• Cyber-Ed project ($460 million)

• Irrigation fund (P3 billion)

• Swines (P5 billion)

• OWWA funds (P550 million)

• Midnight pork barrel (PAGCOR “pabaon” to GMA, P345 million)

• PCSO intelligence funds (P325 million)

• ARMM kickbacks (P200 million)

We can now add to that the helicopters Iggy Arroyo says he leased at the incredible cost of $500,000. That works out at $100,000 per helicopter per year. We checked the normal lease rate for that kind of chopper and it’s around $50,000/year. So either he was conned, or is extremely generous, or, shudder the thought, lying. No doubt he’s got a simple explanation.

But let’s get back to the list of achievements. Mrs. Arroyo compares the wonders of her nine-year rule with one quarter of Aquino’s. One quarter, that just by chance I’m sure, had a base of a quarter in 2010 that was at the height of her profligacy in an attempt to win the election for her people (an attempt that failed dismally). Anyway 1Q 2010 was not a usual quarter, it was an inflated one. 1Q 2010 was just getting back to normal. So a more reasonable comparison would be to the Arroyo nine-year average.

But I’m not going to do that, I’m going to make a much fairer comparison. I’m going to compare her nine years to nine years in Vietnam, Indonesia and Thailand. That’s a much fairer comparison because it covers the same period and the three countries were sufficiently similar in their development, people locality (all in Asia), and potential to grow.

The significant difference was the leadership, which one did the best job at improving the lot of its people. Which is what it’s all about. And on this one, Arroyo failed dismally, ever so dismally. When she came into power, 34.4 million Filipinos earned less that US$2 a day. In 2006 (latest World Bank data available) 39.2 million were poverty stricken—4.8 million MORE had to survive on less than P100 a day.

Social Weather Stations data, meanwhile, showed that the number of families experiencing involuntary hunger “at least once in the past 3 months” reached 3.5 million in 2009 from 1.7 million in 2000.

In Vietnam in 2000, some 68.7 percent of the population or 53.3 million subsisted on less than US$2 a day. This improved significantly to 38.5 percent or 32.7 million in 2008, or 20.6 million less.

The number of Indonesians living on less than US$2 a day also dropped from 141.6 million in 2002 to 117.8 million in 2009.

When Mrs. Arroyo came to power, 3.5 million Filipinos were without jobs. By the end of 2009 around 4.2 million (using the old definition of unemployment) were unemployed or 700,000 MORE.

In Thailand, unemployment fell from 1.2 million in 2000 to 572,000 in 2009. Some 628,000 LESS.

I consider this a massive failure of leadership. Filipinos were worse off after nine years of Arroyo’s rule; our neighbors’ people were better off.

She succeeded, though, in improving the country’s Gini coefficient (an indicator which measures the income inequality in a society; a figure closer to zero indicates a more equal income distribution) from 0.481 before her presidency to 0.448 in 2009. Still, that’s far worse than Vietnam’s 0.378, Indonesia’s 0.394, and Thailand’s 0.425. Income distribution is more equal even in least developed Laos (0.326) and Cambodia (0.407).

I could really stop here. But she didn’t, so neither can I. I won’t cover every single one of the 68 points she made, just enough to demolish the nonsense published.

Take: “GDP grew by 2.23 times since 2001 in peso terms”. Vietnam’s grew by 3.8 times in Dong terms and Indonesia’s by 4 times in Rupiah.

Or “GDP/capita increased by 89% in 2000-2008”. Current GDP per capita has in fact increased from $907 in 2001 to $1,746 in 2009. The figure, however, is just less than half of Thailand’s $3,945 or 75 percent of Indonesia’s $2,331. Even Vietnam whose GDP/Capita was not even half of RP’s in 2001 had risen to two-thirds of it by 2009.

In real terms, the average growth in the country’s GDP per capita was a sluggish 2.7 percent. Again, we were outdone by Thailand, Vietnam, and Indonesia. In fact, from 2001 to 2008, the Philippines recorded the SLOWEST annual growth in real GDP per capita amongst the Asean 5.

“GDP peak growth of 8.3% in 2Q 2007 is the highest in 30 years”. Yes, and lasted one quarter. A flash in the pan, a one time in 38 quarters. She averaged 4.1 percent during her term. Vietnam averaged 7.3 percent while Indonesia did 5.1 percent.

“Average inflation lowest since 1996”. Much of the control of inflation is the role of the BSP (central bank) where an excellent governor kept control. He is independent of the machinations of the Executive branch. The ad boasted of “Pump priming for continued economic growth despite global recession”. And then went to criticize the Aquino administration for underspending. Well, this underspending was a major reason the economy grew slower in the 1st quarter but President Aquino had to because all the projects had to be checked for possible corruption, and that takes time. Mind you, I think Aquino needs to speed up these investigations, we need more money spent to stimulate the economy.

Mrs. Arroyo makes the incredible boast of having lower gasoline and diesel prices, as if the Philippine government, any government had anything to do with oil prices. The world dictates the price, we pay it.

Glaring was the omission of key indicators for long-term economic growth: foreign direct investments and gross capital formation. FDI under Arroyo reached $14.1 billion, trumped by Vietnam’s $34 billion. During the same period Indonesia attracted $32.8 billion while Thailand cornered $61.8 billion.

The country is also way behind in terms of gross fixed capital formation (i.e. investment spending). From 2001 to 2009 investment spending increased by an average of 1.1 percent. In the comparable period, Vietnam recorded an average investment spending growth of 12.7 percent, Indonesia 6.8 percent, and Thailand 6.5 percent. –Peter Wallace, Manila Standard Today