“Gloria Arroyo’s father won as President by exploiting the high price of rice during the Carlos Garcia administration. President Garcia decided not to import rice prior to the elections, which caused his defeat.”
by Ducky Paredes
If the price of rice goes up to P40 a kilo will that be the end of Gloria Arroyo or can we survive an oil price of $120 a barrel and rice at over P50 a kilo?
A paper from Philippine Institute for Development Studies (PIDS) written by Ponciano S. Intal, Jr. and Marissa C. Garcia, indicates just how much importance the price of rice has become as a determinant of political winners and losers.
Prior to Martial Law, according to the study: “The ruling party always used its control over rice supply and distribution in order to gain more votes from the electorate. The opposition party, on the other hand, often capitalized on recurring rice crises in order to discredit the incumbent administration.”
The authors have noticed that rising rice prices preceded periods leading to presidential elections in the late 1950s up to the latter 1960s.
This scenario of rising rice prices would often mean long queues for the government’s low-priced but inadequate rice stock.
The opposition usually pounced on this failure of the administration’s rice policy. Usually, this meant a victory for the opposition.
Gloria Arroyo’s father won as President by exploiting the high price of rice during the Carlos Garcia administration. President Garcia decided not to import rice prior to the elections, which caused his defeat. Faced with a surging Ferdinand Marcos as an opponent, President Diosdado Macapagal went into heavy importations of rice in 1965 but lost anyway:
“The electoral defeat of President Garcia in 1961 and President Macapagal can be attributed in part to…spikes in rice prices during the run-up to the presidential elections. “It is to be noted also that for the 1965 elections, the Macapagal administration increased substantially the level of rice imports (in 1964-1965) apparently in an attempt to dampen the price of rice before the elections but to no avail.”
In 1992 (Ramos won) and 2004 (GMA victory), the price of rice favored the incumbent administration; thus, the administration’s candidate was elected into office.
This, says the study, “is consistent with the hypothesized direction of the political impact of rice in presidential elections in the Philippines.”
The one exception was 2008, when an opposition candidate (Joseph Estrada) won despite stable rice prices leading up to the elections!
“By the sheer magnitude of its contributions to the country’s economic development as well as the diverse and conflicting economic impacts it has on various segments of society, the sustainable supply of rice at low and stable prices has been the government’s overriding objective,” the paper said.
The government’s efforts have shifted towards protectionism, which has not at all helped domestic production. Protectionism has, in fact, worked against the poor:
“In fact, the shift to rice protection since the 1980s has failed to stabilize domestic rice prices and has effectively penalized the poorer households. This has been traced largely to the failure of the National Food Authority to provide timely, accurate, and appropriate intervention in the country’s rice market.”
What the authors call “nominal protection rates (NPRs)” show a trend towards even more protectionism.
NPR is the percentage difference between domestic and border prices. High NPRs indicate high domestic prices, which should benefit producers while lower NPRs mean low domestic prices, which favors consumers.
It has not worked that way. According to Intal and Garcia: “These high rates of protection, which are expected to encourage output growth of domestically produced rice have yet to show substantial positive results.”
Between 1995 to 1998, when NPRs were considerably higher, rice production moved at an average of negative 6.7%. It hardly changed, at 3.3% from 1995-2002 compared with 3.2% from 1970-1994, when NPRs were significantly lower.
Instead, our national policy on rice has worked against us. It has made us more of a rice importer from being a marginal exporter until the early 1990s. This means that the gap between production and consumption further widened while dependency on the external rice market to meet local food requirements has risen, putting food security at forefront of the country’s many problems.
How should we handle rice, then? According to Ponciano S. Intal, Jr. and Marissa C. Garcia, we should do two things:
First, is to set up a tax expenditure fund ceiling for all subsidies to government- owned and- controlled corporations (GOCCs), which will limit the budgetary cost to the government.
Second, adopting a more aggressive support for productivity enhancing investments in the rice sector such as irrigation and better varieties and improved farming practices through agricultural research, development, and extension.
The first suggestion is a good one but the immediate effect on the price of rice may not be too apparent; as for the second suggestion, one notes that the government, for many years now, has been talking the talk on this one. The problem, of course, with many things that involve government is that it often has no answer when one asks the impertinent question: “You talk the talk, but can you walk the walk?”
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“That cruelties have been inflicted; that people have been shot when they ought not to have been; that there have been in individual instances of water cure, that torture which I believe involves pouring water down the throat so that the man swells and gets the impression that he is going to be suffocated and then tells what he knows, which was a frequent treatment under the Spaniards, I am told - all these things are true.” – William Howard Taft, testifying before a congressional committee on the conduct of the Military Campaign against the Philippine Insurrection. (Testimony that, under our present Supreme Court, would be covered by “executive privilege” and would not be heard!)
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hvp 03.27.08)
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