OVER the past several days, I have been desperately searching for episodes of intemperance, indiscretion and moral failure that involved two of the greatest central bankers so far this century: Mario Draghi and Mark Carney. These two men, who went into public service after their stints as central bankers, are known for not suffering fools gladly, and I wanted to know if there was even an instance that they had turned their dislike for fools into very public acts of unrestrained rage.
They are also human, yes, and they can have their moments of indiscretion.
So far, I found none involving Draghi, who, during his time as head of the European Central Bank (ECB), uttered these unforgettable words: Whatever it takes. That meant strategically and deftly deploying every tool in the overall monetary toolkit to save the European Union, the world’s third-biggest economy after the United States and China, from a looming financial disaster. After his ECB stint and his tenure as prime minister of Italy, Draghi wrote a paper that answered the question on what should the EU do to effectively compete with other major economic powers, such as the US and China. Today, the so-called Draghi report remains a hot topic in economic circles.
Ditto for Carney, now the much-admired prime minister of Canada. He once led his country’s central bank, and was later tapped to head the Bank of England. He led both with a breathtaking competence that, in central banking lore, was only overshadowed by Draghi’s stewardship of the ECB during a perilous time for the EU. I once wrote a column with the headline “PH needs a Mark Carney; first declared presidential candidate is Sara Duterte.” I should have revised it as “first declared presidential candidate is tragically Sara Duterte.” Did I fail to mention that his speech at the World Economic Forum in Davos, Switzerland, last January received a rare standing ovation and is now considered one of the most consequential speeches since World War II? In that speech, Carney admitted the end of the rules-based economic order and urged the “middle powers,” including Canada, to chart an independent course.
The admirable central-banking and post-central-banking lives of Draghi and Carney are recalled because of a current debate over certain accusatory statements. Bangko Sentral ng Pilipinas (BSP) Governor Eli Remolona Jr. made this statement at a recent Senate hearing on the depreciation of the Philippine peso: Filipinos do not save enough. Hence, the savings-investments imbalance that, in turn, builds up a current account deficit, which, in turn, weakens the Philippine peso. “Mayabang tayo, eh. May consumption culture na tawag” (We’re arrogant. It’s called consumption culture), he said then in response to a senator’s question on the weakening peso.
The accusation of profligate spending got an immediate clapback from IBON Foundation Executive Director Sonny Africa. Ninety million Filipinos, said Africa, are in the low-income middle class, the low-income class, and the poorest of the poor. Nothing is saved because there is nothing to save. For 70 million Filipinos, their living wage is not even enough to meet their basic needs. What can be saved if the living wage is not even enough for basic survival?
That statement of mayabang and consumption culture is one coming from a man who is “astoundingly entitled, bordering on willful ignorance,” said Africa. A man who is the highest-paid official in the government, receiving P53 million a year. Labor groups also slammed Remolona’s statement for its alleged lack of awareness on the economic struggles of most Filipinos. “Insensitive and out of touch,” said the Nagkakaisa labor coalition, while Gabriela Party-list Rep. Sarah Elago called it “tone-deaf.”
The usual suspects came to Remolona’s defense: economic journalists, bankers, the pillars of the business establishment and pundits. “Bad delivery buries good policy,” said one headline. The defenders admitted the statement’s “clumsy delivery” but countered that it was the accurate macroeconomic analysis of the national savings-investments requirement gap. As expected in a country where the corporate income tax rate is lower than the tax on wages and corporate malfeasance is unfettered, the defense excitedly played by the mainstream media overwhelmed the protestations of the usually voiceless and marginalized organized labor.
Still, one question lingers amid the debate on the BSP chief’s statement: Why can’t the not-so-great Remolona act the way Draghi and Carney did during their years as central banking giants? Carney and Draghi — this is one thing missed by the financial media in defending Remolona — proved that great central bankers can be great human beings. Extraordinary central bankers with public lives marked by extraordinary civic virtue. And humility.
From us, the peons of the nation, this is the shared consensus: there is no excuse, absolutely none, for Remolona’s condescending statement.
But wait. Is it not in the tradition of Filipino poohbahs, especially people associated with banking, to carelessly throw around words that denigrate of the huddled masses?
In 2023, a year marked by surging rice prices and inadequate supply, then-trade secretary Alfredo Pascual, whose background is in banking, suggested a shift to root crops. I remember a newspaper column that reacted to that Marie Antoinette moment from Pascual. Its headline was “Let them eat camote.”