Bu-lat-lat (boo-lat-lat) verb: to search, probe, investigate, inquire; to unearth facts Vol. IV, No. 34 September 26 - October 2, 2004 Quezon City, Philippines |
Arroyo
Has Her Own Share in the Fiscal Crisis While
much has been said about the current fiscal crisis, a great part of the
discourse on this issue has been composed of calls for sacrifice on the
part of the people so that government may be well equipped in facing this
debacle. BY
ALEXANDER MARTIN REMOLLINO Much
has been said about the fiscal crisis the country is currently facing.
However, a great part of the discourse on this issue has been composed of
calls for sacrifice by the people so that government may be well equipped
in facing this debacle. So
far, no one in particular has been taken to task for the fiscal crisis. As
Paul Quintos, executive director of the Ecumenical Institute for Labor
Education and Research (EILER), sees it, President Gloria Macapagal-Arroyo
played a particular role in aggravating the fiscal crisis even as it is
rooted in policies that were in place before she became president. Quintos,
who took an MSc in Development Studies from the London School of Economics
and used to be a research associate at the Philippine Institute of
Development Studies (PIDS), said the fiscal crisis has three primary
aggravating factors stemming from the prevailing “backward,
non-industrialized” economy: imperialist dictates, debt, and bureaucrat
capitalism. The
“backward, non-industrialized” nature of the prevailing system,
Quintos told Bulatlat in an
interview over the weekend, “keeps the economy underdeveloped and always
in deficit, whether that deficit is expressed in terms of trade deficit,
lack of investible funds, and also in terms of government always lacking
in budgetary resources – for basically, the government revenue
collection is a function of the general level of productivity of the
economy as a whole, and if the economy is perennially in deficit, so would
be the government coffers.” “Such
a system is perpetuated by the dominance of imperialism, particularly U.S.
monopoly capital in the Philippines,” Quintos adds. Macapagal-Arroyo’s
role in the fiscal crisis, according to Quintos, lies in her being the
main representative of the ruling system and the ruling classes. To
maintain herself in this position, “she has to implement the imperialist
designs,” he says. WTO
proponent Quintos
notes that Macapagal-Arroyo was the main proponent of the country’s
entry into the World Trade Organization (WTO) as a senator in 1994. The
reduction of tariffs on imported goods, which is required by the WTO, also
reduced the revenues that government is able to collect, he said. He
explained that since the Philippines is an import-dependent economy,
tariff reduction took a huge toll on government revenues. Among
the policies hewing to the WTO agenda is the granting of tax exemptions to
multinational corporations. Finance Secretary Juanita Amatong recently
revealed that the government gave P229.4 billion in tax incentives last
year. As
regards the debt problem, Quintos says the Macapagal-Arroyo administration
exacerbated it by continuing the “good debtor” policy, or the policy
of “holding foreign debt as untouchable or a sacred cow.” Debt
servicing has always received the biggest budgetary allocations under the
Macapagal-Arroyo administration. In fact, according
to Rep. Eduardo Zialcita (Lakas-CMD, Parañaque City), every Filipino
pays P0.40 ($0.0071 based on a $1:P56 exchange rate) for every peso of
debt. More
than P200 billion The
government’s budget deficit for this year is estimated at P197.8
billion. If it had the political will, Zialcita said, resorting to debt
repudiation and renegotiation the government can easily collect more than
P200 billion. Quintos
says the government’s assumption of the debts of government-owned and
-controlled corporations worsens the debt problem. He cites the cases of
the National Power Corporation (NPC) and the Public Estates Authority. In
particular, he said, the government has assumed the debts of the NPC to
facilitate its privatization by encouraging investors to buy in. Meanwhile,
according to Quintos, Macapagal-Arroyo has both direct and indirect shares
in corruption. He
noted that the president was reported last year to have been involved in a
number of corruption cases. These
cases were documented by the anti-corruption alliance Action Against
Corruption and Tyranny Now (ACT Now). Quintos
also said that the Macapagal-Arroyo administration has used a soft
approach to tax evasion. “For
example, I haven’t heard of any resolute pursuit of Lucio Tan and other
tax evaders,” he noted. Tan, a Filipino-Chinese taipan and one of
Asia’s richest businessmen, has P28 billion in unpaid taxes dating
several administrations back. Urban poor leader Carmen Deunida and former
Internal Revenue Commissioner Liwayway Vinzons-Chato are one in calling
him the “country’s biggest tax evader.” Aside
from these, Quintos notes, Macapagal-Arroyo has used “plum appointments
to GOCC (government-owned and –controlled corporations) positions as a
way of rewarding her
political supporters and financial backers, who then milk these
positions to the detriment of public interest.” He
cites the case of Winston Garcia, general manager of the Government
Service Insurance System (GSIS), who has been reported to be earning a
salary of P540,000 a month while the average government employee is paid
only P5,082 a month. “She got a lot of support from him (during the May
2004 elections),” he said. Garcia is presently accused of filching funds from the GSIS. Bulatlat We want to know what you think of this article.
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