Wednesday, August 24, 2005


I was playing the "spot-the-fallacy" game with Tiglao's piece.

If he was talking about the sound economic performance, then the use of the following indicators are fallacious:

Jobs generated annually, measured by year-on-year increases in the number of employed persons, have seen the biggest number under Arroyo.

Of course, as the labor force itself has grown continuously since the Aquino administration, nothing of substance can be concluded from this statement.

Similarly his observations about the stock market index and exchange rate trends don't mean much:

Take the case of our stock market's performance, compared to those of others in the region. We're the third best performer this year... During Erap's crisis that started mid-2000, the peso's exchange rate fell from P43 to the dollar to P51, a huge P8-loss in our currency's value, foreboding a chaotic period unless Estrada was ousted. That certainly convinced the elite to junk him ASAP. In contrast, since the current turmoil started in June, the peso's exchange rate has held steady at the P56-level. This, despite the fact that crude oil prices have zoomed up to their highest levels in 20 years, putting tremendous pressure on the peso's value.

The problem is that these indicators carry an inherent volatility; snipping off any particular brief episode (as he does) as an indicator of economic robustness is a futile exercise, at best. (Anyway, if the exchange rate does depreciate starting tomorrow, how much would you bet that he'd be blaming oil prices or speculation?)

Then he talks about the most sensitive issues - economic growth and poverty.

The economy registered its highest growth under Arroyo's presidency compared to the preceding three administrations; inflation, the lowest. There is an unmistakable economic momentum. Growing only 1.3 percent in the first quarter of 2001 when she assumed office, the GDP growth rate has accelerated to 6.4 percent by the first and second quarters of 2004, slowed down this year only by the oil crisis.


The economic growth under Ms Arroyo has helped the poorest. Poverty incidence has gone down, from 27.5 percent in 2000 to 24.7 percent in 2003. This means 1 million Filipinos getting out of the poverty quagmire in just three years. Wealth distribution has also improved, as shown in the percentage changes in the shares of the different economic groups in the national income. Under Arroyo's watch, the percentage share of the richest 10th decile has declined by 1.5 percent, with the nearly corresponding increases in the share of the poorest deciles.

At first I thought he was claiming causation. Then he would be perpetrating the "non sequitur" fallacy - mistaking a correlation for causation. I noted however that he is not claiming causation. In fact looking over the article, he nowhere claims GMA-causation for any of these fine trends. He's too smart a journalist and logician (undergrad major philosophy) for that. (I too will not launch into an analysis of causation either - I'm a bit antsy about perpetrating fallacies myself.)

So if these trends may or may not be attributable to GMA's policies, why cite them? Well, first, his explicit objective is to demonstrate that the economy is doing well, hence the President's position is robust. I think on this part he's right. It's interesting though to note that the fate of presidents hang by the vagaries of the business cycle. Scary.

Second is Tiglao's implicit objective. It's clear that he's grasping for a vindication-by-association. And this implicit fallacy is the foundation of all hype and image management. Like politicians hugging babies and fulminating against corruption. In short, his article is nothing more - and nothing less - than spin.


Sef said...

I guess the question is: did the economy improved under Arroyo? If it did, then there should have been no need for Tiglao to speak up - for we know anyway what he is going to say.

Econblogger said...

Going by economic growth, poverty measures, and some other indicators, the answer is Yes. Whether the President should take credit for this improved performance is another issue. I think whether the answer is Yes or No, Tiglao will talk - implicitly claiming credit in case of Yes, explicitly blaming external factors in case of No.

These spinmasters will try to have their cake and eat it too.

Anonymous said...

if anything goes wrong in the country the president is the one ultimately blamed; so if the economy shows growth and improvement she should be the one given credit because she is actually the proverbial captain of the ship.

with the barrage of negative articles bombarding the media, it is only right that tiglao post his views to give the public a balanced perspective on developments happening in the country.

Econblogger said...


You are correct, if the president can steer the economy the way a captain steers a ship. However the president does not exert this level of control over the ship of the economy.

I do agree that we need a balanced perspective, what with all the GMA-bashing about. I'd rather have Tiglao's cool sound bite than say Lacson's rants. But this is all style and no substance.