No Mavericks Among Economic Top Guns

June 15, 2022

by Sonny Africa

The testosterone superfest “Top Gun: Maverick” is breaking box office records at the same time that incoming president Ferdinand Marcos Jr’s economic team is being hailed for its competence and credibility. Under the shadow of his dictator father’s reputation for picking stellar economic technocrats, Marcos Jr has eased anxiety about his economic agenda when he returns to Malacañang.

Not that there was any real or widespread anxiety about the incoming administration’s economic team.

Perhaps the fraction of 1% of the population who use government decisions or laws to boost their economic interests were wondering whether or not the choices would be in their favor. But even then, this would’ve just been about whether they will be profiting a little or profiting a lot in the next six years. For the remaining 99% the choice of economic team is just insight into the restored Marcos presidency, or doesn’t really matter at all.

Things would be different if unionist Leody de Guzman had won – then the 1% might’ve worried about radical reforms tilting economic power away from them, even if only ever so slightly. The 99% would also really have had something to be interested in and look forward to.

The incoming planning secretary said that the next administration’s economic agenda will be fully presented at the state of the nation address in July. There are hardly any specifics yet. Still, the tidbits emerging can be interpreted against the team members’ individual track record and especially in the context of the long arc of neoliberal thinking that has defined Philippine policymaking over the last half century.

The next six years will be disappointingly conventional and defined by the orthodox thinking that is the reason for so many of the country’s enormous socioeconomic problems to begin with. The desire for change stirred so much emotion in the last elections – but the continuity we’re getting only promises more of the same.


The president is at the end of the day still the chief manager of the economy. For the next six years it will be someone who failed to get his economics degree, has not shown any real interest in economic issues in his long undistinguished years of public service, and did not even bother to come up with an economic platform or team while campaigning for the presidency.

Incoming president Ferdinand Marcos Jr is not bringing any clear or much less original vision for the economy. The bombast of his predecessor at least included socialist rhetoric. Whatever fragments of ideas Marcos Jr might have will most likely be driven by the impulse of historical distortion or for populist appeal. He will be extremely dependent on his economic team for coherent thoughts and analytical heft.

The team is virtually complete save for a few minor members. His choices are by all accounts well received for their reputed skills and expertise, diligence and experience, and integrity and professionalism.


Bangko Sentral ng Pilipinas (BSP) governor Ben Diokno, 74, is coming in as finance secretary. Before taking the helm of the BSP he was two-time budget secretary under Marcos Jr allies, presidents Duterte and Estrada, and with many years of teaching economics in the academe. As budget undersecretary under Pres. Corazon Aquino, he was among those who pushed for introducing value-added tax (VAT) in the country.

The official mandate of the Department of Finance (DOF) is raising and managing government financial resources from domestic and foreign sources – which includes implementation of fiscal policy – aside from being in charge of government corporations. However, the actual influence of the finance secretary goes far beyond this official mandate as the de facto head of the economic team setting the direction and specifics of national economic policy.

Philippine Competition Commission (PCC) chairperson Arsenio Balisacan, 65, returns as head of the National Economic and Development Authority (NEDA) which he already helmed under Pres. Benigno Aquino III. He has decades of experience as a highly-regarded economist and academic including as dean of the University of the Philippines School of Economics (UPSE). As agriculture undersecretary in the early 2000s, he was the country’s chief negotiator in agricultural talks at the World Trade Organization (WTO) and other free trade deals.

NEDA’s expansive mandate is to oversee social and economic development planning at the national level down to the country’s regions and across all its sectors. This portfolio potentially allows Balisacan to push for his long-standing advocacies on agriculture and poverty reduction. In practice, NEDA provides technical staff support to the finance secretary-dominated economic team where, too often, politically-driven decisions can trump staff work.

BSP Monetary Board member Felipe Medalla, 72, will be BSP governor. Medalla is also a former planning secretary under Pres. Joseph Estrada and former dean of the UPSE. He has chaired the free-market advocacy group Foundation for Economic Freedom (FEF) and held positions in the Philippine National Oil Corporation (PNOC), Metro Pacific Tollway Corp., and Asia United Bank.

The BSP is the country’s central monetary authority formally autonomous from the national government. It famously has sole authority to issue the national currency, but its vast powers go beyond this and includes: supervision over the banking and financial system; lending to banks; oversight over the payments and settlement system; managing the money supply; and maintaining the country’s international reserves.

BSP assistant governor Amenah Pangandaman will be the budget secretary with powerful influence over the planning, programming and allocation of the national government’s multi-trillion peso annual budget and other resources. The budget department also administers a national system of fiscal controls and monitors the financial operations of local governments and government corporations.

Other members of the team include: academic, banker and public-private partnership (PPP) finance expert Alfredo Pascual as trade and industry secretary; oligarch Ramon Ang’s trusted San Miguel Corporation (SMC) Tollways president and CEO Manuel Bonoan as public works and highways secretary; allegedly pork barrel controversy-linked former Abono partylist representative Conrado Estrella III as agrarian reform secretary; Bienvenido Laguesma returning as labor secretary after previously also serving as such under Pres. Estrada; and overseas Filipino worker advocate Susan Ople as migrant workers secretary.


Marcos already called the economic team’s first meeting which the incoming finance, planning, budget, public works and labor secretaries attended. No details were shared although the photo release claimed that he “outlined his priorities and issued his marching orders that were mostly designed to tow the economy out of the woods after being severely battered by the still lingering COVID-19 pandemic.”

In any case, the most important officials have already made statements to the media about their initial thoughts in the run-up to taking office next month. They are familiar and actually for that very reason aren’t encouraging. Accustomed orthodox measures can’t fix problems caused by the same orthodox thinking.

The economy has huge problems dating from before the pandemic. These only worsened with the Duterte administration’s over-reliance on lockdowns to contain COVID-19 and its counterproductive fiscal tunnel vision.

Among the most important things the next government should fix are agriculture and manufacturing falling to virtually historic lows; the economy’s corresponding inability to create enough domestic jobs which forces so many Filipinos abroad or into poor quality work; the concentration of wealth and power in a few while the majority fall further behind; and unchecked destruction of the environment.

The orientation is so important. It would have been refreshing to hear the incoming economic team, first, acknowledge these problems and then, second, propose bold solutions. This could have started from a less elitist view and looking at the economy from the perspective of the majority rather than from a few large corporations including foreign firms.

Instead, in interview after interview, we hear the same tired shibboleths that the outgoing economic team is so fond of: infrastructure; credit ratings; and foreign investment. These have been repeated so often that many take their benefits as an article of faith. However, if these will be the overriding concerns of the Marcos Jr administration, as is likely, then the economy’s basic problems will continue albeit obfuscated behind a growing cloud of economic disinformation.


Speaking about infrastructure is often enough to trigger an endorphin rush. Outgoing president Duterte and incoming president Marcos Jr both understand and exploit the power of bold promises that seem intuitively correct but actually just manipulate positive feelings.

The economic multiplier and job creation benefits are hugely overstated. This isn’t surprising, considering how so much of project budgets are either spent on imports or line the pockets of corrupt politicians and their contractors.

The heavily transport-oriented projects increase the profits of a few favored real estate developers, mall owners, container port operators, and low value-added foreign firms in ecozones. The development gains from infrastructure are however dubious – and even less meaningful since the pandemic and more urgent social priorities.

Some tweaking to the Duterte administration’s puffed-up Build, Build, Build program is possible under the incoming administration. There is some talk of increasing PPPs in infrastructure despite the hazards of putting public services in private profit-seeking hands. There has also been mention of using PPPs purportedly to expand health services.


The stress on credit ratings is unsurprising but no less disappointing. The fetish has long been the reason for imposing higher consumption taxes and repressing public spending. Since the pandemic hit, it has been a major driver of fiscal conservatism and insufficient public health measures, emergency cash assistance for families, and support for informal and smaller enterprises.

Underscoring creditworthiness so early confirms that economic decisions will be overly defined by what is acceptable to creditors and credit ratings agencies – which is simply that debt be promptly repaid, and nothing else.

But this is actually counterproductive. A larger deficit and even more debt are justifiable because larger and more well-designed government spending today will ensure more rapid recovery, greater revenue generation, and easier debt management. Unfortunately, when the economic team sees a conflict between social development and so-called financial strength, it’s the latter that prevails.

The misguided obsession with credit ratings will soon be on full display. The projected Php5.27 trillion national government budget for 2023 is a meagre 4.9% increase from this year. This is the smallest increase since 3% in 2003, or in nearly two decades, and not even half the average 10.4% increase annually over the 2002-2022 period. The miserly increase may not even keep up with inflation and will only dampen aggregate demand and growth just when this is so urgent.

The economic team has been careful to avoid saying that there will be new taxes. In practice, “new taxes” generally means more consumption taxes on poor and ordinary Filipinos, such as the notorious VAT and oil excise taxes. Yet their obsession with cutting deficits and debt to please creditors with austerity budgets will, sooner or later, mean more taxes especially when growth and revenue generation weaken.

The outgoing team leaves behind a package of proposed tax measures targeting the consuming public thinly disguised as a “fiscal consolidation and resource mobilization” plan. The conservative economic team much prefers these regressive measures to the immensely more rational billionaire wealth tax or higher income taxes on wealthy families and large corporations.


The obsession with foreign investment as if it’s some kind of magic bullet for development is also expected. Even as BSP governor, the incoming finance secretary has been among the strongest advocates of the Retail Trade Liberalization Act (RTLA), Foreign Investment Act (FIA), and Public Service Act (PSA) amendments. He echoes relentless hype that these are somehow “game-changing” reforms. He also recently gushed about how these will make the country a “preferred investment destination” and “sustain growth”.

The rest of the team are of the same mind. The incoming planning secretary, trade and industry secretary, and BSP governor have all lauded these investment liberalization measures. Yet for all their expertise, this is based on dogmatic belief more than evidence.

There’s more than enough evidence that hyped foreign investment hasn’t developed the Philippines and that it isn’t decisive for national development. Just here in Asia, the last real industrializers, South Korea, Taiwan and China, actually had less foreign investment in their periods of economic take-off than the Philippines does today.


The incoming team knows that growth was slowing even before the pandemic and that lockdown-induced scarring and the volatile global situation weigh heavily.

They will, however, keep speaking of economic growth because it has a feel-good effect like “unity” does. Yet the Philippines has more than enough experience with jobless growth to show that “growing the economic pie” is just a tired platitude.

In the real world, the quality and pattern of growth matters. Is the growth creating decent work with more jobs and higher wages? Is it coming from more farms and Filipino factories – and are they more productive? Do productivity gains actually go to farmers, workers, and the domestic economy – or to rural elites, corporate bosses, and abroad? Are the civil, political, social and economic rights of communities being violated? Is growth fueled by reckless environmental ruin?

Unfortunately, posturing of being focused on economic growth is often just a pretext for focusing on doing everything to increase corporate profitability even at the expense of human rights, social development, and the environment.


The economic team has already mentioned pieces of other ideas about the economy. Many are the usual, correct things to say – prioritize agriculture and manufacturing, support micro, small and medium enterprises (MSMEs), improve social services like education and health, and reduce poverty. There’s no arguing against motherhood statements.

The policy framework is, however, underwhelming and recycles the obsolete pro-market and business- friendly thinking of so many decades now. This has failed for that long and will continue to fail in the next six years.

Marcos might personally push some non-market economic measures to burnish his populist image such as Php20 rice or food subsidies and self-sufficiency. Still, even if the economic team might relent on some aspects, the incoming economic policy-challenged president will by and large hew to the neoliberal script.

The inevitable desire to stay in power may also drive charter change though where, with the concomitant removal of the last vestiges of economic nationalism, Marcos Jr completes the trajectory of neoliberalism started by his father half a century ago.

The real priorities of the next administration will still be infrastructure, creditworthiness, and foreign investment. Most times, these will be mentioned as if they were development ends in themselves – but they’re not. Sometimes, they will be justified as essential means to development – but they also aren’t. If anything, the fixation will constrain real development.

Infrastructure spending will take away from vital social spending. Chasing creditworthiness will mean insufficient government spending on urgent public health measures, cash assistance for families, and support for informal and smaller enterprises – and higher consumption taxes on ordinary Filipinos. Courting foreign investors will make them profitable but forego gains from letting them invest in the country.

The real development ends of policymaking are jobs, livelihoods, and social services so that there are no poor Filipinos, and building an equitable, stable, self-reliant and sustainable economy. None of these can be left to market forces as current dogma so stubbornly insists.

What is likely to result? Growth will slow. It was already slowing in every year of the Duterte administration even before the pandemic. Agriculture will continue to degrade and manufacturing will become even more shallow and foreign-dominated. Joblessness including poor quality work will worsen. The latest labor force data already shows employment falling aside from being increasingly just informal, part-time and self-employed.

Family incomes will stay repressed and, in the absence of decent work, the poorest will be made ever more reliant on chronic cash transfers. Wealth will stay concentrated in real estate developers, utilities, and importers of the food and goods that we can’t produce for ourselves. Filipinos will be merely cheap labor for foreign capital in the country or exported abroad.

Despite bluster by the outgoing economic team, the Philippines is one of the poorest performing economies in the region.

What should be done? Infrastructure spending should be realigned to much more urgent social protection and social services. Poor and ordinary Filipinos will immediately feel the benefits. Deficits and debt should be addressed with a wealth tax on the country’s handful of billionaires and real stimulus spending to spur revenues and growth. Foreign investment should be regulated to ensure long-term benefits for the economy.

Beyond these, strategic thinking about structural economic changes and meeting social needs while ensuring protection of the environment is absolutely essential. Domestic agriculture and Filipino industry need to be protected, supported and promoted in green directions. This is the only way to create enough work in the country.

Public schools, health services, housing and utilities should be improved and expanded. There must be deliberate and aggressive action to reduce economic inequalities, as well as the power imbalances that buttress these.

Ultimately, it’s simply a matter of turning the bias of economic policymaking away from foreign capital and domestic oligarchs towards the majority of ordinary working class Filipinos. The incoming president is not going to do this. He is supported and surrounded by the same old business elites, and he will also work hard to assure foreign investors that the status quo remains.


Some have already observed that much of the incoming economic team are a little bit along in years. The real problem though is not that any of them are old but rather that they have old ideas. The outgoing team has much younger members also burdened with the same old ideas.

In particular, the notion of the free market and globalization being some kind of harsh but necessary medicine for development is particularly obsolete. This has been peddled for some four decades now. Yet while pockets of prosperity have been created, the majority are still systematically left behind.

The close-mindedness of the theory is glaring. Persistent free market dogma is uninformed by rich thoughts from even just the development state, structuralist and institutionalist perspectives – much less the increasingly rediscovered Marxism. The economic team is clearly of the view that Philippine poverty and underdevelopment is unrelated to wider social, political and economic contexts, or to the country’s historical trajectory and insertion in global processes.

But the problem is clear even without going into the theory of it. To begin with, it should be conspicuous that there hasn’t been a breakout industrializing country from so-called free market policies anywhere in all that time. The Philippine deindustrialization experience is just one among those across the global South. Globalization prevents industrial progress.

Global policy trends have also already been going in the opposite direction for almost a decade and a half now led by the advanced capitalist powers. For instance, since the global financial crisis in 2008, there have been 34,505 protectionist trade policy interventions worldwide compared to just 7,363 liberalizing measures. Similarly, the number of changes towards restrictiveness in national investment policies has been increasing versus a downtrend in liberalizing measures over that same period.

It isn’t the age of the team that’s making them look anachronistic – it’s their policies. There is a genuine sense where the team is composed of competent folks. Unfortunately, this is largely as competent functionaries mechanically implementing obsolete neoliberal policies that petrify an elitist anti-development economic system.

Without any mavericks in the room, there won’t be any change for the better.