Editorial: No problem, borrow

10/19/2009



In a span of less than a month, Gloria had indicated plans to borrow more than $2 billion, which translated into pesos is a dizzying P100 billion.

The amount is supposedly for plugging the budget shortfall which is breaking all previous records and the supposed reconstruction program after two typhoons that resulted in the flooding of most of the provinces in Northern Luzon and Metro Manila.

The flooding was estimated to have caused up to P50 billion in damage for which Gloria said an equivalent amount will be floated by state firm National Development Co. (NDC).

The Department of Finance (DoF) started receiving orders yesterday for $1 billion in debt, part of which Gloria’s economic officials said would be used for the deficit spending next year.

What this means is that before the end of the year, Gloria would have at her disposal a cornucopia of hard cash and this will happen a few months before the national elections.

And we all know what happens during elections under Gloria Arroyo. Public funds — and in the billions — are always utilized by Gloria to ensure the victory of her candidates. And if she is the candidate, it becomes worse, as it was in 2004. Estimates then said it was some P10 billion spent just for her victory.

Several factors are going Gloria’s way, however. Funds are indeed needed as quickly as possible to prevent the devastation from the typhoon to spawn a humanitarian disaster in terms of the evacuees that the government is temporarily caring for.

Just yesterday, the Philippine Chamber of Commerce and Industry (PCCI), which is rabidly pro-Gloria, came out with a statement that the P100 billion portion of the stimulus fund is being diverted for relief, thus justifying Gloria’s decision for the rechanneling of the P50-billion NDC bonds for relief efforts.

The float was initially earmarked for infrastructure buildup supposedly to cushion the impact of the global financial crisis on the economy, which in turn was a component of the stimulus package worth P330 billion.

The float was not undertaken for its original purpose since the private sector was reluctant to match the P50 billion float, considering the dismal corruption record of the government when it comes to infrastructure.

The PCCI, however, said that the private sector’s counterpart commitment has been initiated but this now will have to take a back seat to relief work for which the P100 billion portion of the stimulus package will be rechanneled, after Gloria and her economic schemers had already stated that the NDC float will be undertaken, a classic case of the cart pulling the horse.

The stimulus package was proven to be a mere Gloria showcase, the main target of which was to raise money for infrastructure, which consists of projects always ubiqitous anywhere in the country near an election period.

Hard cash from this package is P50 billion allotment from Congress and the potential P50 billion from the bond float while the rest are the private sector commitments and non-cash incentives and assistance from government institutions such as tax breaks and additional compensations from state pension funds.

The storm-induced calamity opened another door for the much-sought after bond float.

The money that is being generated like mad would have to be added to the already astronomic P1.4-trillion debt of the country which includes a $53-billion debt.

It does not matter that the so-called reconstruction bonds of Gloria are being forced on the World Bank and the Asian Development Bank to subscribe to. Debts are still debts and these are growing like a malignant tumor under Gloria.

Filipinos should pray hard for being spared from the ravages of typhoons and Gloria’s greed.

The latter is more destructive.


Source: http://www.tribune.net.ph/commentary/20091019com1.html