Nothing can justify a dictatorship

Certain words have a distinct aura to them that immediately arouses a specific response from
people. Take the word dictatorship, for example. Use it and people immediately think of Hitler
and Stalin and Idi Amin. It is a most distasteful word, to be avoided by a leader at all costs.
Former President Ferdinand Marcos was accused of exercising dictatorial powers during the
martial law years when there was no Congress of respected political leaders and no free press to
take issue with him. But he would never have called his rule a dictatorial one. After he officially
lifted martial law in 1981, he replaced it with what he called authoritarian government. It was,
therefore, surprising to hear President Dutertes presidential legal counsel Salvador Panelo
proposing what he termed a constitutional dictatorship. It would be constitutional, he said,
because the absolute powers would first be made part of the Constitution.He assured that since
the President is a man of integrity, beyond corruption, he can be trusted with all possible
powers, including those exercised by the Legislative and Judicial departments, the two
departments of our democratic system co-equal with the Executive. Ifugao Rep. Teodoro
Baguilat Jr. fumed at the presidential legal counsels suggestion. Claims of a state of
lawlessness, the supposed pervasive drug problem, and the desire to hasten the speed of reform
do not justify the rebirth of a dictatorship, he said. President Duterte himself has chosen to
ignore the suggestion for a constitutional dictatorship. He does not need additional powers; he
is doing very well with the powers he now has under our Constitution and our laws. He may
have been criticized by international observers who fear human rights are being violated but he
has quite capably responded to the criticisms and, more important, he continues to enjoy the
support of the people.He wants to amend the Constitution to carry out the goal of more equitable,
a more balanced development of the various regions of the country through a federal system of
government. But not to a mass more powers for a constitutional dictatorship. He does not need
additional powers. And he would not relish being known as a dictator constitutional or not.
Davao tragedy
We must not lose sight of the central, crucial, fact: 14 persons died and 67 others were wounded
in the Davao explosion late Friday night. All of the victims were innocents, out to enjoy the
citys popular night market. In the wake of inevitable speculation and confusion, it is important
that we focus on the plight of the victims, and support the citys immediate and valiant efforts to
bury the dead with dignity, ease the pain of the survivors, and pursue justice.Much still remains
to be determined, but initial findings show that a mortar round filled with shrapnel may have
been the explosive device behind the blast. This rules out one of the early hypotheses, that an
LPG tank had exploded; it also confirms the suspicions of many that the Sept. 2 explosion was
an act of terrorism.If it is true that the Abu Sayyaf bandit group or its allies were in fact
responsible for the explosion, then the choice of target was a deliberate challenge to President
Duterte. Davao City is the Presidents hometown, where he served as mayor for more than two
decades, and where his daughter is serving her second term as mayor. It is where the President
tries to spend as much time as possible, and where in fact he was spending the weekend. The
Abu Sayyaf gang had at first claimed responsibility, and then later pointed to another, allied,
group. These claims need to be verified, but there is no lack of excuse for the terrorists to target
Davao. The Armed Forces of the Philippines has deployed several thousand troops to Sulu in a
massive offensive against the Abu Sayyaf; it is the largest such operation in over a decade, and
while it has not yet cut off the head of the terrorist group, it is succeeding in restricting the

groups scope of operations. It was inevitable that the terrorists would strike outside of their
usual territory, at least as an attempt at distraction, or as a strategy to prove that the military
offensive had not undermined its capacity to foment terror.The Philippine National Police, to be
sure, has not given up on the possibility that disgruntled vendors at the night market were
behind the explosion. But the Abu Sayyaf has proven before that it can send its agents into
Davao and its environs. Just last year, Abu Sayyaf terrorists kidnapped a party of four in Samal
Island, just off Davao City. It is unlikely that government investigators will discard historical and
recent proof that the Abu Sayyaf has reached into Davao.Unfortunately, the decision of the
President to declare a state of lawlessness in the wake of the Davao explosion has been
attended by a lack of coordination on the part of Palace officials. The result has been
unnecessary, and unnerving, confusion.There should be no dispute that it is well within the
commander-in-chief powers of the president to call out the Armed Forces to conduct law
enforcement operations. This is squarely within the graduated scheme of powers contemplated
by Article VII, Section 18. To be sure, the Constitution uses the phrase lawless violence, while
both President Duterte and his advisers continue to use lawlessness to describe the condition
that allows the exercise of the calling-out power. But the jurisprudence on this power clearly
holds that the actual declaration of such a condition of lawless violence is actually unnecessary;
the President can order the Armed Forces to help the police, and that is that.But the sequence of
events last Saturday created confusion rather than the clarity the President needs to rally the
country behind him. The scope of the declaration of the state of lawlessness was at first
nationwide, then limited to Mindanao, then widened to the entire country again; the defense
department was reported to have suggested that the scope be limited to those areas in Sulu and
Basilan where the Abu Sayyaf is massed; the current status is nationwide yet again. Various
spokespersons for the Duterte administration were also heard from, and they did not speak in one
voice. We trust that, from today onward, the administration will clarify the use of the Presidents
calling-out power by speaking in unison. Too many voices help drown the central, crucial, fact:
This is a tragedy, and we must prevent it from happening again. One way to ensure that is to look
after the victims and their families, and to pursue justice with the full force of the law.
Lower income tax
Of the reforms promised by President Duterte, the campaign pledge to lower the income tax rate
has generated much interest. Ordinary taxpayers had long clamored for tax relief, given that the
Philippines has one of the highest corporate and individual income tax rates in the region, but
alltheir pleas had fallen on deaf ears.This time looks different as Mr. Dutertes economic team
has already drawn up a comprehensive tax reform package, with the lowering of income tax rates
an integral part of it. By 2019, it is also expected that there will be a simpler, fairer and more
efficient system for all taxpayers.The importance given to the lowering of income tax rates is
manifested in the fact that it will be the first of the four components of the tax reform package to
be implemented starting 2017. Targeted for passage in January, or just five months away, the first
tax policy package will adjust personal income tax brackets, reduce the maximum rate for
personal income tax to 25 percent from the current 32 percent over a number of years (except for
the highest income earners), and eventually shift to a simpler, modified gross system.The
proposal is that those earning up to P250,000 a year will be imposed an income tax of just
P2,500. Under the current system, those earning P250,000 a year are taxed P22,500 plus 25
percent of P110,000 or P27,500, for a total of P50,000. This is because the P250,000 taxable
income falls under the more than P140,000 but not over P250,000 income bracket, which is

slapped a tax of P22,500 plus 25 percent of the excess over P140,000. This will translate to tax
relief of P47, 500. Those earning more than P250,000 to P400,000 will pay P2,500 plus 20
percent of the excess over P250,000; more than P400,000 to P800,000 will be charged P32,500
plus 25 percent of the excess over P400,000; more than P800,000 to P2 million will pay
P132,500 plus 30 percent of the excess over P800,000; more than P2 million to P5 million will
be levied P492,500 plus 32 percent of the excess over P2 million; and more than P5 million will
be charged P1.45 million plus 35 percent of the excess over P5 million.This proposed structure
provides tax relief to the majority who get P400,000 and lower a year, and this will include the
millions of minimum wage earners. Under the present system, those with a taxable income of
P400,000 pay P95,000 in taxes because they fall under the income bracket more than P250,000
but not over P500,000, which is levied P50,000 plus 30 percent of the excess over P250,000.
Under the proposed reforms, the tax will be P2, 500 plus 20 percent of the excess over P250, 000
(or P30, 000), for a total of P32,500. This will translate to tax relief of P62, 500. Actually, the tax
break is for most income brackets. For instance, the current system is such that those earning,
say, P1 million is taxed P125, 000 plus 32 percent of the excess over P500, 000 (or P160, 000),
for a total tax of P285,000. Under the new system, this will be reduced to P132, 000 plus P50,
000 (25 percent of the excess over P800,000), for a total of P182,000.The other good news is that
the reduced tax rate for people earning P250, 000 and below annually, which accounted for 83
percent of all taxpayers in 2013, will be kept in the second year onward, while the tax rates for
the five other income brackets will have downward adjustments every year until these are
brought down to 25 percent (for those earning up to P5 million a year).The government is
expected to incur P139 billion in foregone revenues from this tax component, but it has lined up
compensating measures. These include the expansion of items to be subjected to the value-added
tax mainly by limiting exemptions to raw food and other necessities like education and health.
The excise tax on gasoline and other petroleum products will also be increased and a new tax on
so-called sugary products will be imposed. The proposed excise tax on sugary products
domestic raw sugar, refined sugar, as well as imported sugar and sugar substitutesat P5 a kilo
will generate P18.1 billion. In terms of revenue impact, the first package will actually result in a
net gain of P220.7 billion.Given the fact that President Dutertes allies control the majority in
both chambers of Congress, we see no reason why lowering the income tax rates will not be
implemented this time around.
Cleaning up Marcos
On September 11, the Official Gazette of the Philippines decided to mark the 99th birth
anniversary of the late dictator Ferdinand E. Marcos, by releasing a graphic. What could possibly
go wrong? As it turns out: Almost everything.
The graphic produced by the Gazette carried a photo, a quote, and a caption. Under sustained
social media criticism, the caption went through three editionseach one deeply problematic
both because of what was included and what was left out.
The first version stirred controversy because it failed to describe Marcos for what he was, the
architect of what he himself was proud to call constitutional authoritarianism. In other words,
there was nothing in the graphic to suggest that Marcos was an authoritarian who changed the
Constitution to entrench himself in power.Instead, we got euphemisms like this: He was the
longest-serving President of the country for almost 21 years. Withering feedback on social
media channels was quick to point out that Marcos had engineered the declaration of martial law
in 1972, just before his second and final presidential term under the old Constitution was up.

THAT was the reason he became, in the new Official Gazettes view, the longest-serving
President. The first version referenced the military rule that allowed him to serve until 1986.
In 1972, he declared Martial Law to suppress a communist insurgency and secessionism in
Mindanao. This is only partly true. The communist insurgency he used as an excuse was but an
incipient movement; by 1986, the insurgency had spread throughout the country and grown to
24,000 regulars. The Mindanao secessionist movement was provoked by Marcos own
interventionist plan. Marcos own diaries revealed that he was planning the imposition of martial
law from the start of his second presidential term, all the way back in 1969.
The first caption also offered a version of history that manages to praise the dictator. In 1986,
Marcos stepped down from the presidency to avoid bloodshed during the uprising that came to
be known as People Power. This is the exact opposite of what transpired: Marcos did not try
to avoid bloodshed. In fact, he called on the military to attack the mutineers and their civilian
supporters on Edsa. Also, he did not step down, but wasin the chaos of a Palace surrounded by
protesters and enveloped by panic, on the long night of Feb. 25, 1986ousted.
The second version of the caption removed the mention of avoiding bloodshed (perhaps because
the video and documentary record is clear that Marcos gave orders to attack). But this attempt at
airbrushing history was seen, too, and denounced.
Finally, a third version of the caption was tried; the second paragraph on the declaration of
martial law supposedly to suppress the communist insurgency and the third paragraph on
stepping down from the presidency were deleted. The first paragraph was tweaked to include
the following last sentence: He was the longest-serving President of the country for almost 21
years, declaring Martial Law in 1972 then went to exile to the United States in 1986 at the height
of the People Power Revolution. And a new one-sentence paragraph was added: He was
succeeded by Corazon Cojuangco Aquino.
The third version managed to correct one error present in the two previous versions. Marcos
started his first term as president in 1965, not 1966. (In those days, elections were held in
November and presidential terms began on Rizal Day, Dec. 30.) But other infelicities remained.
The main problem persisted, too: The Official Gazette had failed to take the full measure of the
Filipino politician characterized in both law and jurisprudence as an authoritarian leader, whose
regime was marked by thousands of extrajudicial killings, tens of thousands of human rights
abuses and the wholesale plunder of the economy. The neutral-seeming language the Gazette
chose to use is a clumsy way to clean up Marcos image: He was not the longest-serving
President, but rather a dictator who kept his grip on power; it is not true that he went to exile to
the United States (sic), he was SENT into exile, by a popular uprising.
Now why would the Official Gazette under an administration that seeks to remember the
atrocities of the Americans a hundred years ago attempt to cover up the atrocities of the Marcos
regimewhen these happened only a generation ago?
Non-political reasons
PRICES OF local stocks fell sharply in August, prompting some analysts to claim that the
honeymoon period between Philippine stocks and the new administration was over. When the
weakness persisted at the start of September, foreign media said the mounting stock market
losses were somehow due to President Dutertes controversial war on drugs and foul language.
The Philippine Stock Exchange index (PSEi), the main barometer of local stock prices, rallied
when then Davao City Mayor Duterte won the presidency by a landslide in May, hitting a 15-

month high on July 21. It was downhill from there and, last Friday, the PSEi closed at 7,581.79,
down 1.11 percent for the day and off by 6.42 percent from the July 21 peak. For the year,
however, the PSEi was still up by 9.06 percent.
There are many reasons for the markets weakness last month, and the Presidents constant
cussing is not among them.A fund manager interviewed by Bloomberg summed up what
happened in August and continues in September: He made good money in the Philippines by
coming in before the surge last July, took some profit, and moved to other regional markets that
give him more value and growth.
Price is probably the biggest consideration for an investor when buying stocks; risk is a close
second. The Philippines has one of the most expensive stock markets in the region. The PSEi is
valued at more than 18 times projected earnings for 2016the highest in Asia, and compares
with the average for developing countries of 12.3 times. That makes other stock markets
attractive in terms of price. August is also considered the weakest month for stocks. It is called
the ghost month, and many Chinese investors avoid making financial moves like investing in
stocks during this period because of the belief that it will bring bad luck in the future. It is also
the time when many global fund managers from Europe and the United States take their annual
summer vacation. When fund managers are absent and wealthy Chinese investors from Asia are
not active in trading, the stock market is expected to weaken due to a lack of demand.
Globally, investors are also starting to factor in not only the increasing probability of an interest
rate increase in the United States happening as soon as September, but also the market
uncertainties brought by Britains decision to leave the European Union. Announcements like
these cause fund managers to take out investments from riskier emerging markets like the
Philippine stock market and shift to dollar assets such as risk-free US Treasuries.
Locally, certain economic policies or biases that investors tend to view negatively are causing the
stock market to weaken. An example is the clampdown on mining following the appointment of
ant mining advocate Gina Lopez to head the Department of Environment and Natural Resources.
This has led to the decline in the stock prices of listed mining companies. Another is the
announced policy bias against gambling or gaming, which led to declines in the prices of some
listed firms like Philweb. A pragmatic assessment is offered by BPI Securities chief executive
Michaelangelo Oyson, who views the market reversal as technical and not driven by foreign
investors dissatisfied with the foul-mouthed President: Keep in mind [that] the rally we saw this
year was not because of Duterte. It was largely driven by carry tradethat is, funds abroad came
rushing to the Philippines as they were looking for yields given the negative interest rates in
many [advanced] economies. By the same token, this flow reversal is not about Duterte. It is
about market concerns that the [US Federal Reserve] may raise rates soon, which will diminish
the yield attractiveness of the Philippines as the interest rate differential [narrows].
There is a positive way to view the current stock market slump. Many local stockbrokers agree
that this downturn provides a buying opportunity for local investors because the underlying
macroeconomic outlook of the Philippines has remained positive, global interest rates will
generally remain low, and monetary policies will be relaxed and supportive of equity markets. As
one local broker quipped, we should let the foreign investors cash in and leave and let local

investors take advantage of the dip and buy low. It will likely be profitable for them in the
months ahead.

Name: Brendan Andre D. Aguilar

ABM 2 G11

EAPP

Mr Jemson Delos Santos

Formative Assesment #1