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    A Solid Foundation For Inclusive Growth

    22 February 2017 Message at the FEF Monthly Fellows Meeting, Foundation for Economic Freedom

    Thank you so much for inviting me to join you today. It’s such a privilege to share my thoughts with you tonight, but I hope this evolves into a conversation, whether now or in the future. Many of you are economists, former cabinet secretaries, and public officials that I’ve admired from afar.

    Secretary Felipe Medalla, if I’m not mistaken, was one of the authors of the fearless white paper from the UP School of Economics published in June 1984 that was such a big part of my political and economic awakening.

    For you who are not familiar with the UP Economics white paper, it came out two years before the EDSA revolution. It gave us a real picture of what is truly happening. The administration then was trying to paint different picture of our economy and these UP professors were brave enough to tell what really is happening.

    As I have said, the UP Economics white paper painted the true picture of the Philippines’ economic status at that time, and illustrated how truth triumphs over lies. I find that knowledge highly comforting, in this day and age where the whole world grapples with alternative facts and fake news, and truth has become a rare commodity.

    Speaking of truth, please allow me tell you of a reality I saw when I went to Surigao City in the wake of the 6.7-magnitude earthquake that literally rocked the city. Much of the city’s infrastructure was damaged by the quake and several families fled their barrios to seek shelter.

    When I arrived, what I saw was grief and destruction. A large bridge connecting a barangay to the city had buckled under the force of the quake. What was once a commanding structure looked like a small row of collapsed dominoes. I walked with the villagers as they pointed out the damage: walls turned to rubble, twisted iron bars jutting out from the wreckage.

    Through a crack in one wall, I spied a child’s bed with fallen debris resting on it. A young mother wept to me: her son had to be rushed to the hospital after a wall fell on top of him. Not only did she lose the house the family worked hard for. Now, the future of her son was uncertain. On our way back to the city center, a humble bungalow caught my attention.

    The quake had lifted the house clean of its foundations, so it stood broken and lopsided. On a large piece of cardboard, its owner had written, “Vice President Leni, we need your help.” Later, I realized that this cry for help wasn’t just meant for me as Vice President. It was a cry for help addressed to fellow Filipinos.

    Surigao City’s vulnerability is not unique. We suffer many calamities and it is almost guaranteed that we will see more lives on the line as climate change takes its toll on our planet. In disasters, what is often highlighted is the role of the local government—whether it has the capacity and the resources to respond quickly. Often, local governments fall short, becoming dependent on the national government.

    The trouble doesn’t end when calamities leave. Because many of our LGUs lack the capacity for effective governance—and because wealth distribution remains uneven across the country—federalism seem to have become an attractive option.

    Perhaps to many, federalism may be a plausible solution to our country’s problems. But what form? Which model? There seems to be confusion. But there is something more important to consider.

    If federalism is the answer, what is the question? What do we want to achieve by it? Is it devolution? Is it progress for Mindanao? Is it inclusive growth and reduction of poverty?

    There is no question that we need all three for sustainable and inclusive progress. In a country as fragmented as ours, meaningful devolution is key to inclusive growth. For too long, only the biggest urban centers of the Philippines enjoyed continuous wealth, while rural communities and smaller provinces lagged behind. Truly, it’s time to change this.

    But the tougher and more sensible questions are these: is federalism the only way the Philippines can save itself? Is the Philippines ready for federalism? Can the Constitutional Assembly be trusted to act in the people’s best interests?

    A successful federal government is dependent on certain factors: that LGUs have the capacity and competence to handle so much authority and that systems of patronage do not dominate politics on the local level.

    Practical experience tells us that we enjoy neither. Many of our LGUs are poorly positioned for greater responsibility. And patronage politics continues to hold sway, influencing the outcomes of elections, making public office the business of dynasties.

    Is federalism the only solution to the conflict in Mindanao? Is it the long-awaited cure for persistent oligarchies? Is it the only way to assure equal wealth-sharing among our provinces?

    At this point, I feel that there are more questions than answers. And we need to be sure we are asking the right questions. This means we need more introspection on the fundamentals of the issues we face. We need an elevated national discourse devoid of politics and agendas.

    When I began my term as Vice President, the fundamentals of nation-building were exactly what we looked at. Despite economic growth, millions of Filipinos continued to languish in poverty. Growth has not been inclusive. But we cannot wait for the dividends of progress to trickle down to the poor. We need to act quickly, so we can arrest poverty before it is passed to another generation. Unlike Congressional hearings on the proposed Constitutional Assembly, the suffering of vulnerable Filipinos cannot wait to be solved.

    That’s why in our first month the Office of the Vice President launched a program called the Angat Buhay initiative. It means to do exactly as it says: to uplift the lives of Filipino families in the margins—those who have been unheard, unseen, and neglected.

    Angat Buhay is a movement not just for the welfare of the poor, but also for restoring their dignity and humanity through empowerment and people participation.

    We are piloting Angat Buhay in 50 different local governments. Our focus areas have tremendous relevance for poor Filipino families. These are maternal and child health care, food security and nutrition, quality secondary education, rural development, and women empowerment. Although I am no longer with HUDCC, housing remains a priority focus, as well as rehabilitation of drug dependents.

    Let me, however, train the spotlight on a silent crisis in our country today. Ninety-five Filipino children die every day because they don’t have enough food to eat. Just think about that for a minute. One cup of rice, nutritious vegetables, and some protein can save a child’s life.

    It is an outrage for this many children to lose their lives due to hunger because we have enough food on the planet to meet mankind’s caloric needs. Plus, unlike certain problems like battling disease, we don’t need new technologies or huge resources to produce a bowl of nutritious food to save a child’s life.

    Now, if these children do survive hunger, but do not have enough to eat between birth up to their second birthday, or within the first 1,000 days of their lives, they become stunted. That doesn’t just mean a life of physical disadvantage. It also means mental, psychological, and emotional difficulties. They won’t be able to learn well in school or be gainfully employed.

    Figures from the government show that more than 33% of children under five years old in the Philippines are stunted. A Save The Children study released just last year pegged the combined cost of education and productivity losses due to this level of child undernutrition at P328 billion in 2013, or 2.84% of GDP.

    Aside from the obvious disadvantages this brings to our economy, like the drain on our resources because these children are bound to be repeaters in school, this silent crisis will make it difficult for us to harvest the benefits from our demographic story.

    As you well know, the only way for us to grow at the 7% GDP bracket or higher for the next 30-40 years is for majority of our population to be at their most productive stage during that period. If our children now are undernourished, stunted, and wasted, this growth path could be derailed.

    We need to do something about hunger now. Not tomorrow. Today We are doing our best to check the hunger situation in all our 50 adopted municipalities, as well as their performance in the other development areas we have chosen. Joining us in these efforts are groups in and outside government, our partners in the private sector, development, and civil society.

    We chose these local governments not just on the basis of poverty incidence, but also on their governance style. You see, we want to encourage better leadership among our local governments. As poor as these LGUs might be, we find in their local leaders an authentic regard for honest and accountable governance, as well as a willingness to innovate. We want to see more of that across the country, and Angat Buhay is one incentive towards that goal.

    As you know, the Office of the Vice President cannot implement its own programs and honestly, we don’t have much resources. My role now is to be a conduit of change and a convenor of reform. In doing our work, I hope to see Filipino families break through the barrier of poverty—not just for a short while, but for the rest of their lives.

    As we strive to look for answers to the Philippines’ most urgent issues, we are called upon to be ambitious in our dreams, and to be hopeful despite every difficulty. But let our ambition not cloud our judgment.

    What changes should be made in the structure of our government so we can serve our people better? Is our tradition of public service built on a strong foundation of principle?

    In pursuing drastic solutions, we must proceed cautiously and intelligently, without losing sight of the people’s interests. We must not forget: when the lives of every Filipino are at a stake, there is no room for error. Thank you very much, and a good day to you all!

    Posted in Speeches on Feb 22, 2017