SOME OBSERVERS have pointed out that the rice scarcity has allowed President Gloria Macapagal-Arroyo to divert public attention from the corruption scandals besetting her administration.

This is not a profound observation, but the rice deficit and the price spiral it has generated have already pushed to the backseat the high-profile Senate investigation into the high-profile ZTE national broadband network (NBN) deal. Relief from the venomous ZTE-NBN investigation in the Senate is the least beneficial effect of the change of focus.

Whatever the President does to avert the catastrophic fallout of the looming crisis, she will be skewered, and there will be costs to the public, and other sectors, including rice producers, retailers and traders. The least effective measure the administration can use to combat the rice deficit and the skyrocketing rice prices is police action, which seems to the weapon of choice, to stop rice hoarding and profiteering.

At the Cabinet meeting last Tuesday, the President, impersonating Joan of Arc in full shining armor, said, “I am leading the charge to crack down on any form of corruption by public or private officials who would divert supplies or pervert the price of this essential commodity in any way.”

She also said, “Anyone caught stealing rice from the people will be thrown in jail.” There was no “William Tell Overture” by Rossini to serve as background music to the charge.

Taking a swipe at the congressional investigations on corruption and the media for highlighting corruption stories, she said, “We need food on the table, not headlines.” Some cases being investigated by the Senate have something to do with the rice production shortfalls.

The Senate, in a shortsighted approach to the perennial rice shortages, has not yet examined the policy aspects of the administration’s food production program in its investigation. A recent study, however, has pointed out that the P3-billion fertilizer scam is one of the important reasons for declining rice production. A December 2005 report by the Senate joint committees, chaired by then-senator Ramon Magsaysay Jr., concluded that the P728-million fertilizer fund intended for farmers was diverted by then-undersecretary of agriculture Jocelyn Bolante to the 2004 electoral campaign of President Arroyo.

Speaking at the commemoration of the “Araw ng Kagitingan” [Day of Valor], the President said, “No endless investigation will put rice on the table, computers in classrooms, or clinics in ‘barangays’ [villages].” This is a cheap shot. Food does materialize on the table of the poor—who are being hit hardest by the spiraling rice prices—by creating scapegoats on whom to turn the anger of the hungry people when rice supply runs short in the coming lean months of September-December.

Unless the supply deficits are met immediately, we face a dangerous harvest of wrath from hungry masses storming the warehouses of the National Food Authority (NFA) rather than a bumper crop. By creating scapegoats of unscrupulous and rapacious “alien” (read: Chinese) rice traders, the government is trying to preempt the rage from exploding in its face and to redirect it to its targets.

The rice deficit and prices present the most exacting challenge yet to President Arroyo’s crisis management skills and reserves. From the initiatives she has launched so far, she has not proved to be innovative. The old approaches have been taken out of the shelves and dusted off—including massive rice importation to fill the domestic production shortfalls, monopoly of subsidized rice sale by the NFA, and new commitment of money to increase rice production on short notice. There is no reason to be confident that, in the face of the skyrocketing rice prices, these stop-gap measures can arrest the escalating unrest over food scarcity and high prices from becoming the flashpoint of rioting by the hungry, as had happened recently in Indonesia and Egypt.

Natural calamities—such as typhoons, flooding, earthquakes—draw out the presidential capacity to mobilize resources to alleviate distress. They put a president on the frontline. This role casts even unpopular presidents with rock-bottom public satisfaction rating in a favorable light. They provide leadership with political capital to regain some popularity.

For every move the government makes to head off the unrest in the streets over rice prices, there are costs to pay, whether it is massive importation of rice, allowing the private sector to import rice, not leaving the import entirely to the NFA, cutting by half the tariff on rice imports, or raising the price of government-subsidized rice (at P18.24 a kilogram), to provide incentives to local rice producers and also to reduce its huge losses on the subsidies. This last mentioned, intended measure is a formula for sparking public unrest, as it would put up the price above the current NFA ceiling.

The government intervention to stabilize rice supply, it was pointed out by Credit Suisse, is $1.3 billion—nearly one percent of the gross national product. This puts the government in a bind. You make happy the rice producers, you make angry the consumers—mainly the poor who comprise 60 percent of the beneficiaries of NFA rice. It is the volatility of rice prices that we have to track in the next three months for signs of hungry and angry masses marching in the streets.

Commercial rice, not NFA rice, is the catalyst. Already the NFA has cut rations from three kilos to one kilo to prevent shortage. Already commercial rice price has shot up to more than P40 a kilo in three months, and is expected to reach P50 before the new harvests arrive.

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