Bitter prescriptions
Imbalanced trade, a weak manufacturing base, and heavy borrowings further resulted in the accumulation of foreign debt that made successive and corrupt administrations accommodating to bitter economic pills prescribed by the IMF and World Bank. Under the regime of the structural adjustment program (SAP), up to 50 percent of the national budget went to automatic debt servicing, regressive taxes were increased while social services were reduced, and strategic public corporations went to private hands many of them TNCs.
The government’s commitment to globalization and World Trade Organization (WTO) led to the deregulation of the oil industry. Import liberalization displaced the country’s small producers while tens of thousands of workers lost their regular jobs due to labor-only contract system.
These economic policies took shape in the midst of the periodic crisis of contemporary capitalism battering the U.S. and other capitalist countries. Holding neo-liberalism with a sacred aura, the country’s economic strategists laughed off criticisms from progressive groups that this new capitalist paradigm was designed to bring relief to the leading capitalist economies at the expense of the Philippines along with other emerging economies.
Champions of neo-liberal globalization have shown no empirical evidence to support their claim of equal playing field and economic growth. On the contrary, neo-liberalism has lost its appeal as it has only widened the gap between rich and poor the world over. Today, nearly three billion people – half the world’s population – are living on less than two dollars a day. Conversely, the richest 2 percent of adults in the world own more than half of global household wealth.
Poverty and unemployment
Here at home, claims of economic growth based on GDP cannot hide the unprecedented increase in the number of poor Filipinos by three million (2003-2006), with the total conservative number of poor now 27 million. Current increases in the prices of oil and food products aggravated by the adverse impact of the U.S. meltdown will likely increase the number of poor several times in the coming years. Meantime, about 4.1 million people are jobless with the country facing a 10.8 percent underemployment record in 2007. At least 3,000 Filipinos leave the country everyday in search of jobs abroad. There are other grim statistics about the Philippines human development rating that will make it hard to see any positive signs of success attributed to government’s neo-liberal policies.
The management of the country’s economy is a serious responsibility that should be grounded on the people’s rights and well-being, above all else. Having produced only disastrous results, economic management can no longer be left in the hands of an elite corps of bureaucrats and technocrats who ape lock, stock and barrel models purposely to make corporate profits bigger at the expense of workers, farmers, and other marginal sectors.
Clearly, the most recent financial crisis in the U.S. has dealt a mortal blow to the failed but deadly practices of neo-liberalism the world over and undoubtedly lays the groundwork for the crafting of alternative policies more responsive to the needs of the powerless and marginalized in our societies. We can start right here in our country by working for the end of the destructive and rapacious rule by the elite and building people-centered democratic governance.
By the Policy Study, Publication and Advocacy
Center for People Empowerment in Governance (Cenpeg)
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