To err is human; to correct, more divine
For the error of pork tariff reduction, which includes in-quota minimum access volume (MAV) expansion, it is divine to forgive, but even more divine to correct.
When the 18th century poet Alexander Pope wrote “To err is human; to forgive, divine,” he knew that this would benefit the transgressor. The transgressor would get some relief from guilt. However, in a sense, forgiving also benefits the victim. He will not have the resentment that will continue to hound him.
But hold on! The story should not end there. If the wrong is not corrected, and if the the transgressor can still correct the wrong, the victim should try to have it corrected for the sake of justice. If not, then the picture of divinity will change into a picture of cowardice.
Should we forgive the Office of the President for the error of tariff reduction which will seriously harm our hog producers, 70 percent of whom are backyard raiders? How about the absurdity of losing the P11 billion in foregone government revenue (P8 billion from tariff reduction and P3 billion from MAV expansion) and giving it to importers and traders who do not need it, instead of to the hog industry and COVID-19 victims, whom are told there is not enough money for them?
How about the scandalous wrong of giving these same importers and traders an additional free P45 million gift for freezers in wet markets that they can fund themselves with their huge profits?
Perhaps—especially if the decision was the result of poor judgment based on wrong information, rather than “corruption in aid of elections,” as some claim—the President can undo it since he made the decision. What has brought us to this unfortunate situation? The logic was correct, but the premises were wrong. Since we need to fill the pork supply gap, it is logical to import. It also seems logical that lower import prices from tariff reduction would ordinarily motivate more importers.
But here is where the premise is wrong. It was believed that importers would not fill the supply gap because they were not making enough money to do so. Facts should be determined first before a critical decision is made.
The Alyansa Agrikultura (AA) did research on this. Along with others, AA submitted their findings to the Senate and the House of Representatives. Apparently, these numbers were credible, because both chambers of Congress passed resolutions opposing these tariff reductions. AA has been writing weekly to the Agriculture Committee chairs of both the Senate and the House of Representatives, as well as to specific Senators and Congressmen in the last two years.
One of the people AA sends information to weekly is Representative Joey Salceda. His numbers are not far from those AA has submitted to Congress. Two questions have to be answered to make a good decision on tariff reduction. Below are Salceda’s answers to these questions.1. Do we need to reduce tariffs and expand MAV to motivate importers to fill the gap? Salceda said: “The price difference between imported pork at about P190 after duties and the retail price of about P300-P400 per kilo is enough incentive to import without tariff cuts.” He had earlier said that the gross margins for the importers were up to 110 percent. If we assume a monthly turnover using the same investment, the profit would increase to 12 times as much. Salceda added, “Even at a tariff rate of 100 percent, there would still be an incentive to import.” In other words, the current 40 percent is already too low. To further bring it down to 5 percent is difficult to accept.2.If we did cut tariffs, how much would the consumer benefit? Salceda replied: “We’ve run the numbers. Our findings are that, at the levels DA (Department of Agriculture) is trying to propose for importation, the tariff reduction will only impact average consumer pork prices by 50 centavos. This is not worth the pain it will cause farmers.”
Yes, we can forgive errors, specially if they are caused by faulty assumptions that do not check the reality of the situation. But we must also take the next step of trying to correct the error. Last Sunday, AA suggested that if the President’s advisers remained intransigent, courageous Senators can file for a two-thirds vote to oppose this tariff reduction error. Though the effort might fail, the votes of each Senator would be recorded as a guide for farmers to use for the next elections. We think this will not be necessary. We believe that the President will use humility and wisdom to correct this tariff decision, thus being more on the side of divinity rather than infamy. INQ
The author is Agriwatch chair, former Secretary of Presidential programs and projects and former undersecretary of DA and DTI. Contact is [email protected].
