A10 Friday, December 7, 2018 • Editor: Angel R. Calso
Opinion BusinessMirror
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editorial
November inflation
T
HE Philippine Statistics Authority (PSA) reported this week that the year-on-year increase in prices rose more slowly during the month of November to an inflation rate of 6 percent. The headlines were quick to point out that this was the first drop in 2018. Since everything must have a political spin, pro-administration folks were wondering why if President Duterte were to blame for increased inflation, then he should be credited with a decrease in the rate of increasing prices. Trying to keep both sides of the political agenda narrative in context is difficult. Presidential Spokesman Salvador S. Panelo “attributed the lower inflation to the President’s ‘empathy to public clamor’ and his ‘decisive action’ to stabilize the prices of agriculture and fishery products at reasonable levels, as well as keep their sufficient supply in the markets.” To a certain extent, he is correct as this helped break the inflation psychology that has developed over the last months. The Nikkei Asian Review had this to say: “Slowing food and oil prices were the main contributors to the inflation slowdown. This stems from Duterte’s measures, which range from the easing of restrictions on food imports to the lifting of non-tariff barriers to boost supply. The fall in oil prices also contributed to the drop.” How nice of them to mention that falling oil prices contributed to the inflation rate decline. Consider this. On October 15th, the average price of gasoline in the Philippines—as calculated by GlobalPetrolPrices.com—was P60.87. As of November 26th, the average price was P52.90 or 13 percent lower. According to the Department of Energy, the common price of “unleaded gas” in Metro Manila fell from P59.15 to P49.15 or by 17 percent. Looking at the details of the internal data of the inflation report reveals both the impact of the increase in taxes earlier this year and the impact of changes in oil prices. The conclusion is that—as has been said repeatedly—oil prices are a critical inflation driver both higher and lower. Further, the inflation number has been “distorted” by the tax increase and while prices are significantly higher because of higher taxes, the inflation rate hopefully will return to “normal” by the end of the first quarter 2019. Of the 11 “commodity groups” that are measured to chart inflation: education, communication, clothing, recreation, furnishings, housing and utilities, health care, and restaurants all recorded a 4.5-percent increase or less. These purchases were affected only slightly by the tax increase. “Transport”—up 8.9 percent—felt price pressure from both taxes and oil prices. Food and nonalcoholic beverages—up 8 percent— was also hit by taxes, oil prices, and, in some cases, supply problems. But alcoholic beverages and tobacco prices again skyrocketed by 21.8 percent over the same period in 2017 due to the excise tax increase. The “inflation basket weighting” of the various categories is not equal, and while beer and cigarettes are not as large a purchase as food and soft drinks, the increase in excise taxes will be smoothed out in a few months. We will not see that 21.8 percent inflation next March. However, the government decision to raise fuel taxes is not going to help keep prices steady and certainly not lower. If the administration is adamant on increasing these fuel taxes then inflation is going to be a continuing problem regardless of President Duterte’s “empathy to public clamor” and his “decisive action”. We all better hope that global crude oil prices continue to fall or at least stay at current levels. Since 2005
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James Jimenez
SPOX
D
ESPITE the breathless coverage given to the matter, the Commission on Elections (Comelec) isn’t looking to regulate social media per se. Campaigning will still be allowed online, and everybody can still post and share political content with practically no restriction. However, this doesn’t mean that the political online environment exists in a complete regulatory vacuum. While the use of online platforms is mostly free, the fact remains that the degree of interaction with the audience—likes, reposts, etc.—and therefore the effectiveness with which the platform is being used, inevitably depends on what the user shares on those platforms. On social media, content is king. While some of the best content are essentially produced at next to no cost, those success stories are actually few and far between. Inevitably, reliable and consistently good content of the kind that propaganda campaigns need costs money. This places social media use for political purposes squarely within the mandate of the Comelec to monitor campaign spending—specifically in the areas of content production, the use of post-boosting services offered by various social-media platforms, and the use of social-media operatives—more unkindly referred to as “troll farms.” Needless to say, it is on those three areas that the Comelec is turning its sights.
Content production IF content is king, then the king of content is video. Studies have shown that social-media posts with images or video consistently outperform those posts that have neither. It follows, therefore, that those who want their social-media accounts to pop tend to invest heavily in producing good audio-visual content. In today’s hypercompetitive online world, even amateur bloggers or v-loggers are likely to have equipment that only professionals used to have—things like digital single lens reflex cameras, cardioid condenser microphones, and a staggering range of ring-light sizes. All of which goes to show that the standards for online content have moved way past the old benchmarks. And looking at the content being pushed out, it’s pretty obvious where the money goes.
Boosting
BOOSTING posts, or paying to have the social-media platform “push”
We’re already seeing how the playing field is being skewed by the failure to close the gaping premature campaigning loophole. And certainly, we must all be painfully aware by now that politicians will take advantage of every kind of unregulated behavior. specific posts to a larger number of accounts than would ordinarily see those posts, is a common enough occurrence. Small businesses do it, celebrity fandoms do it, and startups swear by it. It is a cost-effective way of getting your message out to a great number of people. As such, it is a natural fit for political campaigns; except that you can probably expect that political campaigns will be boosting posts on an industrialstrength level, compared to your neighborhood florist. In other words, serious money could be invested in boosting a political campaign’s posts; and again, where there’s money being spent, there should be some measure of regulation.
Troll farms
THE most contentious aspect of what the Comelec is trying to achieve—and certainly the most difficult—is the monitoring of expenses for the use of socialmedia keyboard jockeys. How do I even begin describing the challenges inherent in wrangling this fabulous beast? First of all, the job itself is so new there isn’t even a universally accepted job title for it yet. Social-media operator?
INF is just another unenforceable treaty
Lorenzo M. Lomibao Jr., Gerard S. Ramos Lyn B. Resurreccion, Efleda P. Campos Dennis D. Estopace
Online Editor Social Media Editor
Chairman of the Board & Ombudsman President VP-Finance VP Advertising Sales Advertising Sales Manager Group Circulation Manager
Wet feet
Leonid Bershidsky
BLOOMBERG
A
S important as it is, the great nuclear power quarrel over the Intermediate-Range Nuclear Forces (INF) Treaty of 1987 is about more than any particular agreement. The dispute raises the question of whether treaties remain relevant when some leaders are unwilling to be held to any obligations and others are too weak to challenge them. On Tuesday, Secretary of State Mike Pompeo demanded that Russia comply with the INF treaty within two months or face a US withdrawal from the treaty. Specifically, the US and its North Atlantic Treaty Organization (Nato) allies want Russia to scrap a missile known as the SSC-8 or 9M729, which, they claim, has a longer range than is allowed under the treaty. Russia says the missile
has a shorter range and complies with the agreement. In addition, Moscow accused the US of violating the treaty. According to the Russian Foreign Ministry, the Aegis Ashore weapons systems, elements of both the US anti-missile defense and its drone program don’t comply with the INF’s letter, spirit or both. Moscow isn’t about to make concessions and seems to believe the
Moscow isn’t about to make concessions and seems to believe the treaty is already dead. On Wednesday, Valery Gerasimov, Russia’s chief of general staff, told foreign military attachés in Moscow that if the US abandons the treaty, Russia will target any country where US intermediate-range nuclear missiles are deployed.
treaty is already dead. On Wednesday, Valery Gerasimov, Russia’s chief of general staff, told foreign military attachés in Moscow that if the US abandons the treaty, Russia will target any country where US intermediate-range nuclear missiles are deployed. That threat could lead to a standoff much like the 1980s confrontation between the Soviet Union and European Nato members that agreed to house US Pershing II missiles. But these tensions obscure a more troubling general picture. Both the ultimatum and the tough response
Digital operative? Professional commenter? And perhaps most tellingly, hardly anyone—least of all a candidate for public office—will admit to actually using the services of these individuals whose paid-for output largely consists of posting comments on social media. However they’re called, the bottom line is that their employment represents a potentially significant item of expenditure for political campaigns, which must be ripe for regulation. Surprisingly, despite all of these strategies having been deployed to great effect in the 2016 elections, I have yet to find a single Statement of Contributions and Expenditures from that period reflecting payments made for any of them. Considering that the coming elections will only see an escalation in the use of online campaign materials—not to mention the inevitable improvements in the quality of the content being produced—failing to do anything to remedy that situation strikes me as being incredibly lazy at best. We’re already seeing how the playing field is being skewed by the failure to close the gaping premature campaigning loophole. And certainly, we must all be painfully aware by now that politicians will take advantage of every kind of unregulated behavior. Then it should be fairly easy to understand that allowing social media to keep on being a hospitable haven for illicit campaign spending is simply unacceptable at this point. There will be difficulties ahead, of that there can be no question. But it is time to get the Comelec’s feet wet.
are about optics: The US wants to be able to say it gave the Russians fair warning, and Russia, in turn, is trying to persuade the world that the US has long since made up its mind to tear up a treaty that constrained it too much. Substantively, however, the dispute is about both sides’ willingness to comply with any mutual constraints at all. Russia’s president, Vladimir Putin, has shown time and time again that expediency is more important to him than any preexisting agreements. The land grabs in Ukraine and the obstacles Russia puts up for ships headed to Ukrainian ports on the Sea of Azov are, in Putin’s mind, justified by geopolitical or security considerations. These justifications take priority over pieces of paper signed by his predecessors. Whether Putin will stick to a deal depends on whether he can get away with not complying. That makes it difficult to negotiate anything with him: The Russian See “Bershidsky,” A11