The Law of Diminishing Returns

One of the fundamental laws of economics, taught to us even in high school, is the law of diminishing marginal returns. Basically, what it says is that when additional inputs of a factor of production, say, labour, is added to a fixed amount of another factor of production, say land, the amount of additional yield that the additions of input is able to generate, diminishes in time. So, if adding one more labourer to the fixed amount of land produces, say, 5 tons of crop yield, the third labourer may yield a disproportionate 3 additional tons. The law also applies to factory input-output ratios. At some point, adding more workers will produce less than the previously utilized workers. For non-economics students (even if you were not taught by Dona Gloria, misma), try reading more about the law from Paul Samuelson’s Economics.

The law of diminishing marginal returns could also apply to other inputs, be it genuine fertilizer, organic or chemical. It will not apply though to fake foliar liquid fertilizers applied to land, whether in the irrigated ricefields of Iloilo since converted into subdivisions, or in Norzagaray, Bulacan. Obviously it won’t, because the fertilizers are fake, or at best, diluted several times over with water. For better understanding of the ratio of fake fertilizers and the incremental output in rice yield, if any, the authority is of course one of the most celebrated icons of corruption, Jocjoc Bolante, mismo, the candidate for governor of Capiz of Sen. Manuel Villar.

The law may well apply to political spending as well. If the beautifully-crafted Money Villarroyo campaign ad and anthem (Alexander Syfu or Louie Morales? for creative advertising, as in a signature Christian Louboutin for ladies shoes or a Testoni for Don Jose Miguel Arroyo) which exploits Baseco children to proclaim Manny’s signature poverty (kuno) earned him a powerful January surge, will now the law of diminishing marginal returns begin to apply?

Signs there are that marginal returns are diminishing. The Pulse Asia survey findings based on field work done February 21-25 and released on March 5 tell us that from a 2 point whittled-down lead in its January figures (Noynoy 37, Money 35), Noynoy now has 36 compared to Money’s much reduced 29, for a spread of seven points. Has the magic spell created on the D and E classes by “Nakaligo ka na ba sa dagat ng basura” worn off, such that hundreds of millions poured into that poverty anthem, plus Dolphy’s testimonial to Money, plus millions spent to buy “free” media, now become the object of the law of diminishing marginal returns?

And is this the reason why Money’s creative people have switched to another anthem, the one you see and hear on television these days? Now the same Baseco (or is it Isla Puting Bato?) kids are utilized (did you compensate them properly, Money?) to sing a paean to the poor man’s dream, with Money Villarroyo, but of course, as the icon of hope. Except that this time, the kids are singing about getting rich “sa malinis na paraan”. Now is that being defensive on C-5, on San Pedro, on Iloilo, on Norzagaray, on NHMFC and Pag-ibig funds, on Daang-Hari at Daang Reyna, on Molino and Paliparan, on SSS and GSIS funds, ad nauseam, or all of the above? A deep-seated guilt complex working on the Money Villarroyo camp?

The new, improved (?) anthem, like the re-launch of Tide or Safeguard, even invokes the Lord God Himself, as in “nagtiwala sa Maykapal”. Hindi na kayo nangilabot?

But will throwing bad money after bad money on advertising, no matter how visually appealing, no matter how memorable the sound, keep the numbers going up? Or has the law of diminishing marginal returns caught up with the excessively obscene use of money by Money? And have the Baseco kids become subjects of that other economic law called the law of diminishing marginal utility?

Again recalling what Paul Samuelson and not Gloria Macapagal Arroyo taught us, a person’s satisfaction over the continued use of a product (or continued exposure to such, as in a TV commercial), declines in time as he consumes more and more of that product (or listens to it over and over again). The “marginal utility” of product, service or advertisement to the consumer declines as he partakes more or is exposed more often. The Tagalogs have a term for it --- “nakaka-umay”, or “nakakasawa”.

When “umay” or “sawa” sets in, then the product or service becomes a “dis-utility”, and the producer of said product or service becomes, well…inutile.

Now pray ask, when Money Villarroyo loses the election, what will happen to those poor Baseco kids? Like the junk and the garbage that their parents probably forage for survival, their plight will be discarded. They have been used. And their marginal utility to Villarroyo diminished to in-utility. For that is how it is with users.

Going back to the latest Pulse Asia reading, the trust survey of Villar seems to have nose-dived by 11 points. In January, thanks to the Baseco kids plus Dolphy, Money’s trust ratings went up, eclipsing Noynoy’s by 6 points. In the February 21-25 field research, Villar goes abysmally down by 11 points. Porque?

Has C-5 and his cowardice to face the Senate of his peers finally gotten enough traction, and the people are now beginning to realize the kind of person that he truly is? Is that why Noynoy is up by a whopping 16-point lead over Money in the National Capital Region? And despite Money’s strength in Regions 1, CAR, Eastern Visayas, Caraga and ARMM (the last three being the poorest regions of the country), Noynoy’s lead widened to 7 points over January’s statistically dangerous 2 points?

Truth is, it may be too early to tell, especially in a campaign where the search for truth is hostage to an obscene amount of ill-gotten money by Money. Take note of that humongous crowd that greeted Willie Revillame and his sexy and scantily-clad dancers as they gyrated in a fabulously set-up stage in Cabanatuan the other night. Money Villaroyo and Loren Legarda were Willie’s co-stars, and Money’s caboodle of senators Willie’s extras. The crowd roared with each Revillame inanity, and the males lapped up the sight of bare flesh. Whether these would endear Money Villarroyo enough for them to forget the way he has gypped the poor farmers of neighboring Norzagaray, we will not know until May 10, 2010.

Meanwhile, also in Cabanatuan, many of the poor people with whom Manny Villar claims he feels kinship, went there not to be regaled by the antics of Revillame and company, but to bring their medical prescriptions, or ask him for financial aid to defray hospitalization costs. A 17-year old teen-ager, convinced by the Villar commercials, went there to experience the candidate’s pro-poor sincerity. He raised 300 pesos by carrying sacks of rice for a neighbour, and used it to travel from a far-away town to Nueva Ecija’s center. He was just used.

And so, while the law of diminishing marginal returns should be operative, one can never accurately predict how an avalanche of that input called money could affect public perception as much as a secret benediction by Gloria Macapagal Arroyo can affect the outcome of the elections in favour of, or against --- Money Villarroyo.

* * *

In just about a month’s time, two of the most dedicated lady public servants passed to the Great Beyond. The first was Josie Lichauco, former transport secretary, a mentor of mine when I first entered government service in 1986. Josie was a feisty crusader against bad governance and corruption most gross, and has been at the forefront of the struggle against the present national leadership.

Last Monday afternoon, another dear colleague in the FSGO (Former Senior Government Officials), Emily Boncodin, succumbed to renal failure which triggered a cardiac arrest. Emy was one of the most competent budget secretaries the country has ever had. Her dedication and efficiency was legendary, but more than these, her integrity and simplicity was outstanding. And when she had enough of the scandals hounding the president who appointed her as DBM secretary, she resigned quietly, and went back to the UP academic community.

One would wish these two ladies could yet advise a new president cloaked with requisite moral character, so that finally we may be led out of the morass we find both polity and society entrenched in. Now, we can only pray for them, and wish they too are praying for the benighted land while in the company of the Almighty.

(banayo_at@yahoo.com)

LITO BANAYO
MALAYA Column for Thursday, 18 March 2010