National Capital Region
Division of City Schools - Valenzuela
Valenzuela City School of Mathematics and Science
A. Pablo St., Malinta, Valenzuela City
Marcos Government’s Response to Inflation: Does It Seem Scanty?
Writing a Position Paper
Written Work
Submitted by:
Ramos, Donalyn P.
12-HOBBES
Submitted to:
Mr. Edison M. Lalimarmo, LPT, MA
November 23, 2022
Late in June, Ferdinand Marcos Jr., the Philippines' then-president-elect, took an unusual
action: he named himself agricultural secretary, in charge of the nation's food initiatives. Due to
supply constraints and high fuel prices, the Philippines, like many other nations throughout the
world, is experiencing rapidly rising food inflation. However, taking control on his own is
unlikely to provide Marcos more choices. In the medium term, especially in comparison to
nations like India, Thailand, and Vietnam, his options for policy are relatively constrained. Due
to its reliance on imported food to feed its growing population, the Philippines is the most food
insecure nation in emerging Asia, and Marcos' selection as president is a worrying omen for his
nation's food security in the face of an impending crisis. Presently, according to the findings of a
Pulse Asia Research, Inc. study conducted in September and made public in October 2022,
almost 42% of Filipinos repudiate the competence of the Marcos administration in managing
inflation. According to the Pulse Asia survey, which was conducted from September 17 to
September 21, 2022, combating inflation is yet again the most demanding national priority of
Filipinos today. The Marcos administration received the lowest rating from the general public,
which is another problem. All of these give way to the uncertainty of whether the Marcos
government truly had an up-to-mark performance in addressing most national issues, particularly
controlling inflation and poverty reduction. It's difficult to believe that the government's hands
are tied when it comes to rising inflation rates and their consequences. It can be argued that the
Marcos administration lacked the means to address the top national concern that the new
administration should deal first for a variety of reasons, including the acquisition of the highest
inflation rate, Marcos' receiving a negative rating in the polling firm Pulse Asia Survey, and,
most importantly, the president has a variety of other options to address the issue.
The Philippine Statistics Authority's most recent data revealed that the country's inflation
rate increased to 6.9% in September 2022, the highest level in four years. It was significantly
greater than the 6.3% August rate and the 4.2% September 2021 rate. Food, which accounted for
7.4% of the increase in inflation in September, along with housing, water, electricity, gasoline,
and other fuels, 7.3%, and fast food joints and lodging services, 4.6%, were the main
contributors. The subnational estimates for the geographic areas covered by the survey also have
the following error margins at the 95% confidence level: 5.7% for Metro Manila, the rest of
Luzon, Visayas, and Mindanao. This is because the pandemic's effects on supply chains are made
worse by a collapsing peso, which has been escalating inflationary pressures amid rising global
energy prices. The economic team has not yet provided any proposals for slowing down rising
inflation. When the Monetary Board meets in August, according to Bangko Sentral ng Pilipinas
Governor Felipe Medalla, the central bank will be ready to implement its first rate increase of 50
basis points since 2018. To help the poor cope with the impact of rising costs, the Duterte
administration announced continued cash assistance and fuel reimbursements. However, Marcos
may be forced to end the programs for the next year due to budgetary restrictions. Economic
managers thus anticipate a stronger and longer-lasting economic recovery in 2023.
2
Although Marcos made a remark after the Philippine Statistics Authority (PSA) revealed
that inflation in the country had risen that they would need to be cautious seeing as our economic
and monetary policies at the moment primarily rely on using interest rates to hold or control the
inflation rate, a nationwide survey of 1,200 adults from September 17 to 21 revealed that 42% of
respondents thought Marcos was doing a poor job of doing so, as reported by the Pulse Asia
polling firm. This resulted in a net approval rating of -11%, which is the only area where Marcos
had a poor performance evaluation. The net approval rating is the gap between the acceptance
and rejection scores. When reached for feedback, Anthony Lawrence Borja, professor of political
science at De La Salle University (DLSU) in Manila, stated that inflation appeared to be an
increasing threat to Marcos' reputation. The likelihood that Marcos would resort to populist cash
handouts to maintain his prominence would vary based on whether support for the government's
handling of other economic concerns implodes. This would be a serious obstacle for his
economic managers, who must strike the right balance between satisfying the administration's
short-term public demands and sustaining growth. But, the negative effects of this inflation on
Marcos' popularity might be weakened by: (1) the Filipinos' ability to absolve him by berating
other stakeholders, from economic managers to foreign entities; (2) the high authorization of
other vital socioeconomic issues, such as employment generation and salary increases; and (3)
their ingrained sense of fortitude and survival without the legislature.
Even so, a group of activists disagrees with the notion that the government is powerless
to handle the problem of increasing inflation rates and its impacts, asserting that President
Ferdinand Marcos Jr. has a number of options at his disposal. As the headline inflation rate for
October 2022 increased to 7.7 percent, Bagong Alyansang Makabayan (Bayan) stated on Friday
that the President can begin by designating as urgent the bill that seeks to decrease or eliminate
taxes on basic commodities in order to aid underprivileged communities. It is truly untenable to
claim that, in the face of rising costs and wage degradation, the government has no influence.
The government has an obligation to solve the people's escalating economic problems. The poor
inflation figures should motivate the administration to investigate populist measures like pay
increases. The state should be forced to look into the plight of ordinary workers who are trying to
make ends meet because of the 7.7% rate of inflation. Thus, it is now essential to have an open
discourse about increasing working people's pay and incomes and bringing down the cost of
necessities. Our legislators ought to be developing policies that would lessen the enormous
financial burden that the populace is currently bearing. The moment has arrived to assist the
working people who are in the clearest need. In the meantime, the crisis must be resolved by
increasing local output, which is hampered by a number of problems, including a dearth of
infrastructure connecting farmers and markets. Subsidies do not really solve the Philippines'
persistent problems with food insecurity; rather, they are just expensive band-aids that the nation
cannot afford. Even though Marcos cannot control the global supply shock, he still has the power
to stop the peso's decline. Improving agricultural production will be critical to sustaining his
country's rapidly expanding population and reducing the country's vulnerability to volatile global
pricing.
3
The Philippines is most inclined to combat food inflation through subsidies. This action
will be expensive for the state's finances, which are already depleted after investing in
construction and pandemic-related expenses. But while food protectionism grows, the nation will
remain at risk. The administration might increase interest rates to stop the peso's decline, but it
has made it clear that it is hesitant to do so and will only take action momentarily. Although
President Marcos strongly opposes the Philippine Statistics Authority's (PSA) headline inflation
rate, it is undeniable that the Marcos administration handled the inflation issue inadequately.
With that, it is advised to prioritize addressing concerns pertaining to the agriculture sector,
reducing inflation, and creating jobs or other sources of revenue for the effect of inflation on
Marcos' reputation would rely solely on whether there was or wasn't a clear, definite plan that
could allay public fears while giving the appearance of government activity, the overall and
envisioned effects of certain policies, the escalation or relief of external pressures, as well as the
inflation seeping into other domains of human security like poverty and food security, and the
presence of "scapegoats" that the Marcos administration could use.
4
References:
42% of Filipinos disapprove of Marcos gov’t response to inflation – survey. (2022, October 6).
RAPPLER.
https://www.rappler.com/nation/filipinos-disapprove-marcos-jr-administration-performan
ce-inflation-pulse-asia-survey-september-2022/?fbclid=IwAR3hg4Kv3lIrCaKgqgbYrC8
HNrcCioDjLUaA1FfTkeBpLvuZbnXbxx3kuPw
Cigaral, I. N. (n.d.). Filipinos unhappy with Marcos’ handling of inflation problem — survey.
Philstar.com.
https://www.philstar.com/business/2022/10/06/2214735/filipinos-unhappy-marcos-handli
ng-inflation-problem-survey
Lalu, G. P. (2022, November 4). Bayan: Gov’t not hand-tied with inflation’s effect, there’s a lot
Marcos can do. INQUIRER.net.
https://newsinfo.inquirer.net/1689527/bayan-govt-not-hand-tied-with-inflations-effect-the
res-a-lot-marcos-can-do
Marcos, who initially failed economics, disagrees with 6.1 percent inflation rate. (n.d.).
Ph.news.yahoo.com.
https://ph.news.yahoo.com/marcos-disagrees-with-inflation-rate-that-psa-reported-07390
7659.html
Morales, N. J. (2022, October 5). Philippines’ 4-year high inflation boosts chances of more rate
hikes. Reuters.
https://www.reuters.com/markets/asia/philippines-4-year-high-inflation-boosts-chances-
more-rate-hikes-2022-10-05/
Nguyen, T. (2022, July 13). Why the Philippines Is So Vulnerable to Food Inflation. Carnegie
5
Endowment for International Peace.
https://carnegieendowment.org/2022/07/13/why-philippines-is-so-vulnerable-to-food-infl
ation-pub-87467
Royandoyan, R. (n.d.). Filipinos want Marcos gov’t to tame inflation first, boost wages — Pulse
Asia. Philstar.com.
https://www.philstar.com/business/2022/07/12/2194852/filipinos-want-marcos-govt-tame
-inflation-first-boost-wages-pulse-asia
Share, Twitter, Twitter, & Twitter. (n.d.). PH inflation warrants “careful” handling: Marcos.
Www.pna.gov.ph. https://www.pna.gov.ph/articles/1178292
