MANILA, January 29, 2004 (STAR) POSTSCRIPT By Federico D. Pascual, Jr. - CIVIL WAR THREAT: With due respect, we think former President Joseph "Erap" Estrada acted rather irresponsibly when he declared that a civil war could break out if his friend Fernando Poe Jr. were disqualified from running for president.

This is no idle threat. We’ve seen how Erap loyalists – who have linked up with Poe fans – staged violent marches whenever some official action or ruling was not to their liking.

As presidential candidate, Poe has to say if he subscribes to the resort to street protests for resolving legal disputes. His continued silence means either he is unable to form an opinion on the matter or he agrees with street-brawl solutions.

As rival candidate Raul Roco has noted, Poe should snap out of his dangerous illusion (engendered by his one-plot movies) that problems can be solved speedily, in two hours flat, with fast fists and blazing guns.

* * *

REDS BACK POE: Most people have not noticed that the communists, the NDF/NPA, have openly endorsed the candidacy of Poe and his running mate Loren Legarda.

As Poe has not indicated that he frowns on or is rejecting the avowed support from the Left, we assume that an entente cordiale of sorts or even a modus vivendi exists between Poe’s camp and the communists.

It is unlikely that the United States, the country’s most important ally and investment source, would be comfortable with Poe’s leaning to the left. The inflow of American investments and foreign aid could slow down under a Poe administration.

Neither can Japan, a major trading partner, and other American allies in the fight against global terrorism be comfortable with a president who is cozy with rebels already tagged as terrorists.

* * *

R.P. NEEDS HELP: This is no idle point since foreign investment and outside assistance, in accelerated levels, are crucial to our economic recovery.

Using our own limited resources, which are dwindling at an alarming rate, we cannot jumpstart the sputtering economy. Without foreign assistance, the renowned resilience and the talent of the Filipino for improvisation would prove ineffectual.

As it is, we keep borrowing more millions, some of it from foreign lenders, just to pay the interest on loans falling due. The public debt keeps growing.

The budget deficit (P200+ billion) and the ballooning public debt (P2.3 trillion) are chomping away at the revenues that the finance department is able to collect from a people already taxed to the bone.

* * *

DWINDLING COLLECTIONS: Revenue collection has been declining. While it was 17.5 percent of the gross domestic product in 1997, it is now only 13.5 percent and there is no indication it will go up sharply.

More than 30 centavos of every peso in the national budget go straight to paying the interest (making no dent on the principal!) on our public debt. From what is left, some 25 centavos of the budget peso is swallowed by the bureaucracy as wages.

Then billions in pork barrel and graft money are pocketed by corrupt officials and their cohorts, leaving only a tiny stipend for meaningful capital expenditures and development projects. Clearly, we need substantial help from outside.

* * *

P75 = U.S. DOLLAR: Can somebody like Poe, the supposed frontrunner in popularity surveys among presidential candidates, revive the economy by relying mainly on his hordes of fans shouting in the streets?

Already, the peso’s exchange value keeps dropping with every indication that Poe’s candidacy is gaining ground. Threats of street violence add to the instability.

A sick joke has it that Filipinos laboring abroad and their families would go all out for Poe, because they expect daw their dollars to fetch something like P75 to the greenback once Poe captures Malacañang.

With surveys heralding a Poe victory and a heavier debt burden looming, Moody’s Investors Service has downgraded by one notch the country’s sovereign rating. The rating of our foreign currency long-term bonds and notes fell from Ba1 to Ba2. The foreign currency bank deposit ceiling was lowered from Ba2 to Ba3.

Bonds rated Ba are considered to have speculative elements. A downgrading increases the government’s cost of borrowing. An increase in the cost of money will push up domestic interest rates, thus slowing down growth.

* * *

POE A DISASTER?: Foreign investors and businessmen we have talked with view a Poe presidency as a disaster, despite his reportedly surrounding himself with a topnotch economic team. Most of them said they saw a repeat of the Estrada fiasco.

They expressed fear that Poe may not be competent to evaluate the possibly confusing advice of his consultants who hold varied views and some of whom may be pushing ulterior business and political interests.

Poe’s continued silence on how he intends to manage the economy has not been helpful in allaying these fears. While he reportedly "charmed" businessmen the last time he met them, there is a chasm between social charm and hard performance.

Rather than gamble with an uncertain future, many foreign businessmen indicated they would settle for a more predictable, though badly bruised, administration that has learned the hard way.

* * *

FM DISEASE BANISHED: Reminds us of the Foot-and-Mouth disease that once broke out in livestock farms during the martial law regime of Ferdinand Marcos.

The free press (i.e., free to say "yes, sir" with a bow before pressing the "print" button) had a holiday regaling readers about the "FM Disease," abbreviated in the headlines as FMD, taking its toll throughout the land.

It didn’t take long for the dictator to sense what some recalcitrant elements in the media were trying to do, probably with a vengeance. Wherefore, he decreed that henceforth, that blasted FM disease shall be erased from the books and replaced with Hoof-and-Mouth Disease or HMD.

PS: Of course there was/is another disease called Foot-in-the-Mouth disease afflicting many politicians, but no cure has been found for it.

Reported by: Sol Jose Vanzi

All rights reserved