Tuesday, 21 July 2009

They’re trying to kill the Philippines!

Outside the Box
John Mangun
Business Mirror

Twenty years ago, the local press touted stories of how the US government and particularly the US Central Intelligence Agency were involved in a series of continuing efforts to influence, if not undermine, the Philippines. Looking back, that paranoia was probably justified at least to a certain extent.

The Philippines prevailing against the pressure is best illustrated by the cancellation of the bases agreement which turned over Clark and Subic to the Philippines. Of course, we might argue whether the Philippines maximized the potential of those two properties in the last 18 years. But that is beside the point. The Philippines decided to chart its own destiny on the bases and that is undoubtedly a good thing.

For some reason, as I have said so many times before, there seems to be a need in the Western institutions to tell the Philippines what should be done, how Filipinos should be running and managing the country.

No matter which nation comparable to the Philippines in size and economy that I look at, I cannot find examples of this pervasive “advice- giving” that the Philippines receives.

Maybe it is because of the Philippines’ recent colonial past under American rule. Perhaps it would have been better, at least from gaining the world’s respect, if the colonizers had been forced to leave at gunpoint as from so many other nations, rather than with a ceremony and a Philippine flag-raising. Maybe the Philippines would be more respected if, upon independence, the nation had disintegrated into a civil war like India, Vietnam and to a lesser extent China, after the World War II occupation by Japan ended. 

However, whatever the cause, I am convinced that no other nation is subjected to the large amount of “expert” advice as the Philippines is, and most of that advice is simply bad, sometimes, very bad.

It is as if they are trying to kill the Philippines.

Last week, the World Bank strongly suggested that that government raise taxes on oil products. This suggestion was justified by the World Bank as a method to increase government income as “plunging revenues could ‘jeopardize’ a government-spending package aimed at boosting growth.” I could be diplomatic like Economic Planning Secretary Ralph Recto when he said in a statement that “raising taxes on oil products isn’t an immediate priority for the government.” But instead I will describe the idea exactly as it should be described: absolutely brain-dead.

Raising government taxes on oil products at this time would guarantee a disaster for this economy. The World Bank “suggestion” again shows, no, proves, that they have no understanding of this economy. Further, it proves that the World Bank is committed to making sure that the free market in the Philippines is killed.

The Philippine economy has always been able to maintain a well-balanced level between supply of products and demand for those products to keep prices stable and inflation low. Therefore, our inflation is determined by external factors like high world oil prices. Now that oil prices are way down, our inflation problem is almost non-existent. So here comes the World Bank telling the government to create inflation. That is not a great pro-poor, pro-everybody policy.

Further, the socialist, big-government policies of the World Bank want you to give your money to the government through higher taxes and then the government will use your money through a “government spending package aimed at boosting growth.” Now raise your hand if you think the government can spend your hard-earned money with more efficiency, less waste, and spend it more productively than you can.

Institutions like the World Bank hate countries like the Philippines and people like Filipinos that do not rely on big government for economic survival and prosperity. You see, in fact, they believe that you are just too stupid to make financial decisions yourself and you need them, the government, to spend your money “wisely.”

There are many, many types of foreign intervention that is not healthy for this country or this economy. Take the environment movement. Several prominent politicians are high on the “save the planet” crusade. Their speeches accurately imitate the worst nonsense from the West. They scream and shout about how the Philippines must join the global-warming hysteria while ignoring the fact that India and China, both 10 times larger than the Philippines, both disregard the bad environment policies of
the “First World.” If these politicians really want to “save the planet,” perhaps they should start with Metro Manila. The biggest, most immediate, costly environment problem in the National Capital Region is flooding.

Last week the economy lost tens of millions of pesos worth in lost productivity because of the rains. Certain legislators want to spend hundreds of millions of your pesos on “renewable energy.” Congress wastes its time and your money on windmills while children drown and infrastructure is damaged from a flooding problem that has never been adequately addressed. Why?

Because it is so easy to get advice and sometimes money from organizations like the World Bank to solve problems that they think are important, regardless if it has nothing to do with the daily lives of Filipinos.

The more we listen to the advice of “experts” and institutions which care nothing about this country or its people, the more time and effort we lose for truly solving our problems.

On a personal note, beginning next month, I will publish a weekly market update, with trading strategies based on technical analysis which gives entry prices and timing. If you would like subscription details and an example of this weekly update, now available only to members of the Portfolio Trading Program, please e-mail me.

PSE stock-market information and technical-analysis tools were provided by CitisecOnline.com Inc. E-mail comments to mangun@email.com.

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