The Dole-Out King!
Is borrowing money at high interest rates safer than printing money out of thin air that could further devalue our already devalued currency and taxing the people? There are indeed only four ways for the Aquino administration to finance its welfare programs: 1) tax the people, 2) borrow money from foreign sources, 3) print paper money, and 4) rely on foreign relief and aid.
The Aquino administration did not invent or inherit massive government spending. It’s already part of our political system, ‘collective’ culture, and social identity. It is in fact an essential part of our semi-socialist 1987 Constitution. So if you oppose massive government spending on welfare programs like health care, education, transport, dole-outs, or any kind of freebies for the poor, the tendency is that the know-it-all hippies and the country statist intellectuals would tell you, “It’s in the Constitution.”
Yes, giving government dole-outs to the poor is legal and constitutional, which means it is also legal and constitutional to turn this country into a welfare state slave pen. This is the very reason why this country is poor and cannot achieve economic progress. Economic destruction is our only final destination as a nation. We only have ourselves to blame.
We are a welfare state. That’s a fact. Contrary to the traditional definition of this concept, welfare state is NOT a system. It is the result of a particular political and economic system, which is a statist system. Welfare state is the result of too much government intervention, regulations, and intrusive government roles and functions allegedly designed and implemented to serve the people’s welfare and needs. This source defines this concept as “a government that provides for the welfare, or the well-being, of its citizens completely”, and “such a government is involved in citizens’ lives at every level.”
There’s no tinge of doubt that the current administration is sustaining and upping the degree or level of the country’s welfare statism through its destructive policies and welfare programs like the Conditional Transfer Program. This system creates a cycle of dependence, and makes the President the overseer of a 21st century plantation in this country in which the people, particularly the poor which the system seeks to serve, become more and more dependent on the government.
Just recently it was revealed that the government obtained P120-billion to finance its welfare programs. Perhaps borrowing money even at high interest rates is more preferable to and safer than taxing the people since the administration is doing its best to save its already dwindling approval rating. The money will be used for the conditional transfer program, which is a by-product of previous and present administrations’ intellectual bankruptcy, mediocrity and realpolitik.
As I stated in a previous blog, conditional transfer is “one of the mediocre ways to allegedly combat poverty, as it negates/overlooks the role of the markets in poverty alleviation. But if we are to oppose this welfare statist program. Thus, it must be opposed on the following grounds:
- It’s an unjust tool of wealth redistribution. It’s like taking Pedro’s money in order to serve the welfare of Juan.
- Our current economist crisis was/is caused by the government through its failed economic policies, regulations, punitive taxes, protectionism, cronyism, etc.
- Poverty is an economic issue, NOT a political issue. The government cannot legislate extreme poverty and hunger because this statist strategy will only create more problems and make the existing problem/s worse.
- It can be a source of corruption. In fact, it is corruption from the very beginning since its clear and obvious purpose is to serve the current administration and its proponents. This program is being supported by the current administration because it can be used to prop up the dwindling popularity of our ratings-conscious President.
- Economically, it is anti-free markets, and, in reality, it cannot alleviate poverty. So why waste “public” money?
- If the government is to alleviate poverty, the only solution is to revise the charter and then focus on economic and even political reforms. The solution is to guarantee economic freedom by forever scrapping our current 60-40 protectionist arrangements, repealing regulatory measures and laws, abrogating the labor code, and eliminating income tax and other forms of taxes.
Fortunately, some people in the government raised objections and proposed to scrap this program by 2014. But why not scrap it this week, this month, or this year? Why wait until 2014 to totally get rid of this welfare state program? Well, perhaps these pinko, sell-out politicians clearly understand that they still need this program for the 2012 elections. Political self-preservation, as usual.
The House and the Palace plan to enter into a “compromise deal”. What’s clear is that President Aquino badly needs this program to save his dwindling popularity, while some lawmakers ‘somehow’ understood the program’s budgetary impact. So the House demanded that the CTP be scrapped by 2014, while the Palace proposed that it be extend until 2015. By that time, our country would be facing serious economic crisis as a result of the government’s failed economic policies, massive government spending, lack of foreign direct investment due to our protectionist policies, regulations and high tax rates, and bad governance.
What about the P120-billion in foreign loans that the government obtained to bankroll the cash grants over the next five years?
There’s Negros Oriental Rep. Pryde Henry Teves who somehow understood that something’s wrong with the program.
“We cannot allow this to continue if we would rely on foreign borrowing. The government has allocated P120 billion for the five-year program that would come from the World Bank and Asian Development Bank. The money is being released in tranches. We would be mired in foreign debt if we allow that,” Teves said.
Apparently to stave off possible public criticisms, Speaker Feliciano Belmonte Jr. and Majority Leader Neptali Gonzales II said the government has already inputted the “exit plan” in the 2012 budget.
Here’s an excerpt of this news report:
The House contingent to Mexico, led by Teves and Batangas Rep. Mark Llandro Mendoza, recommended the abolition of the P21.9 billion conditional cash transfer program by 2014 or the government “just like Mexico may never be able to get out of it.”
Agham party-list Rep. Angelo Palmones wanted the recruitment of recipients halted at 2.3 million this year, and the budget allocation kept at P21.9 billion to be able to have a decent phase out by 2014.
Social Welfare Secretary Corazon Soliman has proposed an increase of 89 percent from P21.9 billion to P39.8 billion for the additional 700,000 recipients that would bring the total beneficiaries to three million by 2012.
Budget Secretary Florencio Abad said the target for enrolled recipients would have reached five million by 2015.
As of end August, the number of recipients that would start getting the handouts next month hit 2.3 million, Soliman told the Manila Standard.
Soliman also admitted that some $805 million, or $400 million from the World Bank and $405 million from the Asian Development Bank had been used to fund the first 900,000 recipients in the first year of the dole’s implementation under the Aquino administration.
She said the loans only had an annual interest rate of one percent, with five-year grace period and payable in 25 years.
Soliman said the Public Works and Highways already committed job opportunities to household recipients as part of the program’s “graduation strategies.”
Soliman said under the Pantawid Pamilyang Pilipino Program (4Ps) the partner agencies like Horteleza Foundation also committed vocational training and starter kits and capital on cosmetology.
It seems that we’re heading for a very probable, not just possible, crisis in the near future… Our politicians should look at what’s happening now in Greece.