INFLATION reports bring to mind a story Todd Buchholz wrote in his book “New Ideas from Dead Economists.” While visiting his old economics professor, a business owner sees and begins to read an exam on the professor’s desk. It shocks him that it was the same exam he’d had to sit through some 15 years ago. “Aren’t you afraid the students are just going to track down old tests?” he asks. “That’s OK,” the amused professor reassures him. “I do keep the same questions. It’s the answers I change each year.”
Last Friday, the Bangko Sentral ng Pilipinas (BSP) announced that consumer prices had risen for the ninth consecutive month. At 6.7 percent, it was the highest since February 2009.
In Central Visayas, the inflation rate reached 7.0 percent in September this year, from 6.3 percent in August. We belong among 11 regions where inflation rose faster than the national average. The three regions where inflation in September rose fastest are Bicol (10.1 percent), Autonomous Region in Muslim Mindanao (9.0 percent), and Ilocos (8.6).
Those, by the way, are headline inflation rates. Core inflation was 4.7 percent in September, from 4.8 percent in August, the Philippine Statistics Authority (PSA) reported last Friday. Core inflation, which leaves out food and energy because their prices are volatile, is supposed to help us understand purchasing power better. As a consumer, I don’t find it particularly comforting, since leaving out food and fuel from the family’s monthly purchases isn’t an option.
Stopping by a gas station a few hours after last Friday’s inflation report, I was again reminded that the same amount of money that pushed the needle on the fuel gauge close to “F” this time last year bought only enough fuel to bring the needle just above the halfway mark. So far this year, the price of gasoline has gone up by P10.40 per liter, according to the energy department’s monitoring. It’s almost enough to make one consider drowning inflation-induced sorrows in some wine or beer, except that the prices of alcoholic beverages also went up by 21.8 percent in September. And health care was at least 4.1 percent more expensive than it was in the month before. Do not imbibe, for the sake of your liver and wallet.
The Duterte Administration’s economic managers had less judgmental advice: Stay on guard against profiteers. “We are working swiftly to temper the rise in the prices of goods and offer relief to those most affected,” they added in the statement posted also last Friday on the finance department’s website. They said there were “clear signs of easing” and that they remained confident inflation would taper off within the year. They had hoped the arrival of imported rice would keep food prices from going up fast, but Typhoon Ompong damaged P26.8 billion worth of crops and agricultural facilities, and doused such hopes. Last month, the Office of the President ordered government agencies to make it easier to import fish, sugar, and other agricultural products, as one way to boost supply and pull prices down.
Can you remember how your family coped in February 2009, when inflation was this high? Memory offers few tips we can recycle, and these are the obvious ones like tightening our belts, living as simply as we can, and stocking up on non-perishables, if possible. For that matter, how did Filipino households cope with 8.2 percent inflation in 2006, 9.2 percent in 1998 or 50.3 percent in 1984? What did government do to ease the pain? I don’t know if telling people that 6.7 percent inflation will make “no big difference,” as one Cabinet official did, is a Keynesian or monetarist’s answer, but it helps no one. To the recurring test of inflation, all of us could use more practical answers, or at least less callous ones.
(On Twitter: @isoldeamante)