ECQ extension most logical approach to saving lives, economy

April 12, 2020

House Ways and Means Committee chairman Joey Sarte Salceda (Albay, 2nd district) has hailed President Duterte’s decision to to extend until April 30 the Enhanced Community Quarantine  over Luzon, stressing that “history and economics do not show that extension is a trade-off between lives and economic growth”. 

“Even modified lifting of ECQ is like choosing disaster twice in both health and in economics: It implies losing more lives of what you save; in economics it means losing more in the long run. If you extend ECQ, you save more lives and actually recover faster in the future,”  Salceda explained 

His statement is a reaction to proposals from some quarters for a modified or selective lifting of the ECQ, if not its total termination.

“If anything, the more lives we lose and the more panic this virus creates if it gets worse, the less our chances are of any quick recovery. Our people and our confidence – these are the two greatest resources in any economy, and they are the only irreplaceable ones,” he said.

The Albay lawmaker cited a recent paper by American economists Correa, Luck, and Verner (2020) which points out that, “during the 1918 flu pandemic, American cities that had longer lockdown periods reduced mortality rate and increased employment rates in the medium-term.” The paper, he said suggests that “NPIs (no-pharmaceutical interventions such as lockdowns) play a role in attenuating mortality, but without reducing economic activity, and that cities with longer NPIs grow faster in the medium term”.

In a media interview, Salceda said “the historical evidence says that if you use time wisely to build capacity, improve your system of care, and avoid making mistakes, such as premature lockdown lifting, you reduce mortality rate and facilitate faster recovery”.

“I know that from experience because my zero-casualty doctrine in Albay enabled us to go from a poverty rate of 28.7 percent when I took over in 2007, to 17.6 percent in 2015 just as I was about to leave as Governor (of Albay). That’s the lowest in Bicol, and a full 10 points below the regional average,” said Salceda, an economist and known disaster risk reduction expert.

“Disasters which are common in Albay, are not a hindrance to growth. If anything, our paradigm reassured Albayanos that their government values them more than anything. And human capital is the most valuable resource in economics,” he added.

As early as January, Salceda filed a bill seeking to create a health emergency framework that would have included the establishment of a Center for Disease Control in the country. By February 4, he had written an aide memoire to the House leadership on economic countermeasures to Covid, including the expansion of health facilities. 

A week before the ECQ, he called for a lockdown of Metro Manila, just as community transmission was discovered. He had also written President Duterte a five-page report on how subsidies could be released to the public before the Bayanihan to Heal as One Act was passed, and a 12-page report on mass testing and post-ECQ measures.

“More often than once a week, we submit some detailed reports to the government and the House leadership. Our reports are wild speculations. They are based on the best available statistical models, from research, and from my experience as a crisis manager, both in 2003 when we were in very bad fiscal shape, and when I was Governor of the most disaster-prone province in the country,” he shared.

Salceda said that based on his policy team’s monitoring, infections are still accelerating.

“Doubling time for the number of confirmed cases is currently at 4.7 days. That means we will see the number of cases doubled by Friday if things don’t slow down. That doesn’t look like a peak to me, or frankly, to any doctor, public health expert, or data scientist who looks at it.” he pointed out.

“Even some of the most credible voices in economics are saying we should go for an extension, and use that time to beef our efforts up. Former BSP Deputy Governor Diwa Gunigundo says ‘An extended lockdown precisely serves the cause of a more sustainable economic growth in the long run,’” he said, adding that the Economist magazine, arguing against preemptive lockdown liftings across the world, also says “a government trying to privilege the health of its economy over the health of its citizenry would in all likelihood end up with neither”.

“I know that we will have to intensify strategies while in the extension period. That’s why we have submitted a 12-page plan to the President that highlights mass testing, increased isolation of confirmed and suspected cases, and boosting our health care capacity and protecting health care workers. ‘Hindi po ito basta lang’ (This is not idle thinking). We’ve studied it, and the studies have been submitted to our leaders,” he added.

The lawmaker also stressed that “to minimize the economic costs, the most important thing is to keep the lights on to maintain the pre-COVID  structure of the economy with as little loss in jobs as possible. That’s why it’s important to lend cheap credit to businesses, provide subsidies to the people, keep our logistics moving, and retool manufacturing towards essential goods,” he further explained.

“We have to rationalize our supply chain and our system of checkpoints and controls. I recommended to the President a coordinator for production and logistics to handle this matter – something like a Minister of Production during wartime. Economic growth is always in the future. We have many economic tools to restore economic growth, but no economic tool has ever succeeded in bringing the dead back to life,” he added.