2 ‘asecs,’ 2 senators, and the tobacco lobby

The reader’s indulgence is begged, as yours truly cannot resist comment on three issues, two of which have made the headlines, and the third of which seems unfortunately to be underplayed in the news, thanks to a very strong lobby.

A Tale of Two “Asecs”: There is Virginia Torres, chief of the Land Transportation Office, with the rank of assistant secretary, and there is Carlos Gadapan, deputy director general of the Philippine Drug Enforcement Agency (PDEA), also with the rank of assistant secretary. Both of them are career civil service, or whatever the term is for people who have been working as civil servants before their appointments as “asecs.”

Torres was involved in very high-profile controversies that resulted in investigations by the Department of Justice, which in turn resulted in recommendations by the DOJ for her dismissal and/or for administrative charges to be filed against her.

Gadapan was not involved in any scandal/controversy—at least, nothing that got him in the newspapers (until his relief as asec). He claims that he was never involved in any scandal, nor was he ever the subject of any government investigation.

And yet it was Gadapan who “lost the confidence” of P-Noy, and was summarily relieved of his post for that reason, while Torres continues to enjoy P-Noy’s confidence. Go figure.

The Palace defense is that “all presidential appointees are aware of the fact that we all serve at the pleasure of the President and that you can be relieved at any point.” But surely the underlying assumption there is that the pleasure of the President is based on the exercise of good judgment and solid evidence, one way or the other. Surely the assumption is that the President will never give in to whim and caprice, the way an absolute monarch, say, will do.

In the Labor Code, by the way, loss of confidence—arising from fraud or willful breach of trust by employees—is a just cause for termination of employment (Art. 282). But the jurisprudence arising from that article decrees that the breach of trust not only has to be willful, but must also be supported by substantial evidence. The employer cannot get away by claiming loss of confidence based on whim and caprice.

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A Tale of Two Senators: It is very clear that the fight between Senators Juan Ponce Enrile and Antonio Trillanes was started by the latter, when in a privilege speech he named Enrile as the reason he was quitting the majority bloc in the Senate, complete with attacks on the quality of Enrile’s leadership (supposedly dictatorial at the very least) and motives (alleged lackey of Gloria Arroyo).

What is not clear is whether Trillanes actually knew what he was getting into—because he seemed genuinely surprised and upset when Enrile rose to give back at least as good as he got. And Trillanes then made matters worse by walking out of the session hall, giving Enrile the opportunity to add cowardice to his list of Trillanes’ supposed failings.

What then transpired raises questions in the public mind as to the level of Trillanes’ intelligence, or at the very least the soundness of his judgment. The Brady report, assuming it is an accurate depiction, certainly shows an inflated sense of self-worth and importance, the desire for power (also, remember Oakwood), pointing to more than a hint of megalomania. He credits himself for all the so-called successes (frankly, I don’t see any) in the Sino-Philippine contretemps, and thinks he knows more than Foreign Secretary Albert del Rosario—or at least is more effective, and shows disdain for Enrile’s “Let the people decide” attitude.

That Trillanes seemed to be afraid that the Camarines Sur gerrymandering would succeed, by the way, is more an indictment of his colleagues in the Senate than of Enrile himself—because the implication of his statement is that they could be railroaded by the Senate President.

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A Tale of Tobacco: The tobacco lobby is pulling out all the stops in trying to keep the excise taxes on its products low. Its arguments, and the quick answers: 1. Taxes on the tobacco industry are larger than on any other industry in the economy. That is unfair. Answer: That’s the natural consequence of its product being a “demerit good” with a lot of negative externalities, which the tax seeks to internalize, or which aims to curtail its consumption. But as a matter of fact, the proposed excise taxes on tobacco are not excessive, and will only bring the rates on par with those imposed by other countries.

2. Increases in the excise taxes will only lead to more smuggling. Answer: Simple statistical tests on the data that the JTI (a tobacco company) presented to support this assertion actually show that the relationship between smuggling and a reduction in “affordability” is not significantly different from zero, and that affordability accounts for only 5 percent of the variations in smuggling activity. The point is that smuggling will take place if it pays to smuggle, period—i.e., where efforts to curtail smuggling are (deliberately?) weak.

3. The poor should pay lower taxes than the rich. Answer: This argument implies that the poor should be given more chances to kill themselves than the rich.

4. Increasing the excise taxes on tobacco will hurt the sari-sari  store owners and other vendors, because their income from tobacco sales will go down. Answer: Even assuming this is true, it is also true that their income from the sales of other products will go up, as buyers shift from tobacco to other products.