Money

This is unsettling: all the talk of money being distributed to the nation’s legislators in exchange for their votes in the heated speakership race.

A few weeks ago, people expressed disgust at the rampant vote buying that happened on the eve of elections. It was the only way electoral contestants could go around the instant counting enabled by the automated system.

The speakership contest, it seems, opens an opportunity for the winning politicians to recover the money they had so freely distributed in the streets. This time, it is their votes as congressmen that are on the bidding block.

Pantaleon Alvarez first broke the news about the money on offer in the mad contest for Speakership. He quoted estimates ranging from P500,000 to a million being distributed to win support from legislators.

Alvarez, who is lamely posturing for the post, has the credentials to speak on the role of money in winning support in the House. During his shortened term as Speaker, public works projects were lavished on loyalists and denied opponents despite the ban on pork. Money was his means for winning allegiance.

The deployment of money to influence legislative behavior is not news. During the Noynoy years, billions in public funds were distributed to legislators through the outlawed Disbursement Acceleration Program (DAP) in the frenzied effort to oust then Chief Justice Renato Corona. Except for Joker Arroyo, Miriam Santiago and Bongbong Marcos, all the other senators saw their pork richly supplemented through the DAP. The conviction of Corona leaves an ineradicable stain on our institutions.

The distribution of project money – presumably to be processed by the likes of Janet Lim Napoles – is one thing. The distribution of cash in fat envelopes in exchange for legislative votes is quite another. It reeks of sheer crassness.

As if the revelations of Alvarez were not shocking enough, Rep. Aurelio Gonzales of Pampanga now tells us the money on offer has just escalated to P7 million per congressman. Multiply that by the 150 or so votes to secure a majority in the House and we arrive at a rather astonishing sum.

The higher quotation is almost unthinkable. One suspects this has to be a ploy to raise expectations among the honorable congressmen out to sell their votes. If one cannot stay in the game, the next best option is to alter the rules so that the game becomes unplayable.

Still, even that higher quotation is not completely implausible. Many of the incoming congressmen spent over a hundred million to win their seats and give them a speakership vote they could use to recover some of their expenses.

The alleged vote-buying at the House is the fruit of the money politics we call “democracy.” As this becomes all the more pervasive, the roles played by visions, programs and statesmanship are perilously diminished.

Safeguards

The case presented by the domestic cement industry during the recently concluded hearings of the Tariff Commission is compelling by every measure.

Although free trade is the norm, local cement manufacturers have made a strong case to argue that unmitigated importation of cement could bring local industries to the point of distress. Republic Act 8800 provides for the imposition of safeguard measures if a surge in market share of an imported product may cause serious injury or impair local industry.

There is reason for this provision. Building our industrial base requires large investments and time to mature. That industrial base must be safeguarded against the vagaries of momentary trading opportunities. If we lose our industrial capacity, our economy will be vulnerable.

Local cement manufacturers presented evidence before the Tarff Commission about the investments they have made to make the industry most efficient and lower costs for consumers. It will take time for these investments to bear fruit.

The local industry likewise offered evidence to show that it has enough capacity to meet domestic demand notwithstanding the construction boom and government’s ambitious infrastructure program. The industry accounts for a significant share of the gross domestic product and provides gainful employment for tens of thousands of Filipinos.

The Tariff Commission’s own figures show that cement importation (mainly from obsolete plants in Vietnam) rose from negligible amounts just a few years back to 1.7 million metric tons in 2016. That represents about 7% of the domestic market.

Despite provisional tariff barriers, the share of imported cement rose to 12% of the market in 2017 and then to 17% the following year. That rise in market share is astronomical. It was made possible by “pure” importers who have made no investments in plant capacity and employ no workers. They are simply cashing in on the construction boom, taking advantage of the absence of any safeguard measure.

The rise in the share of imported cement brought distress to local manufacturers. Profitability has dropped dramatically. New investments in modern plant facilities face market risks.

The DTI, for its part, assured the Tariff Commission that total current capacity of local manufacturers, at 34.5 million tons, sufficiently covers the 32.5 million tons of domestic demand. Any safeguard measure designed to ensure the growth of local industry will not result in shortages.

The price advantages of cement imports are negligible in the short term. But they could cripple domestic capacity in the long term. Our national interest lies in painstakingly building up our manufacturing and technological capacity so we could match international quality and price standards down the road.

Significantly, the “pure” importers presented no counter-arguments to those made by both the domestic manufacturers and the DTI.