DEBT that sounds like DEATH

I was with my politically incorrect (whatever that means ha ha ha) friend the other day. We were talking about Gloria’s SONA 07  (State of the Nation Address also known as Same Old Nuts Again) and a lot of other things.

The Broken Bridge Although he expected the same things from Gloria’s speech, he was surprised and awed by the grandiosity of Gloria’s dream especially the projects that she wishes to accomplish at the end of her term(if that really is true).

Friend: Where is the money? Our government has no money, di ba?

Me: Our government has billion peso budget deficits (always), right?

Friend: What is the connection?

Me: This simply means that our government is spending billions of money every year whether it can earn the money or not. The budget deficits and the growing debts indicate that there is money to spend. The question of where is the money is not a question at all. People in the government can make money easily.

Friend: What do you mean? How they do that?

Me: Simple. Do you have money now?

He checks his wallet.

Friend: I have 10 Riyals and a few (but very expensive) peso bills. Ha ha ha.

Me: But you want to buy that last piece of Babolat tennis racket. And you promised your son that he will have his Mac Book Pro this month.        

Friend: Yes, but my cash is not enough.

Me: What are you going to do now?

Friend: Aha. Wait. No more problems. Okay na! I have my plastic with me. Besides the bonus and the commissions are coming soon. Hopefully these will cover the payment for these items. If not,  I will file a personal loan.

Let us forget my friend for now and let us go back to earth. I am not done with this post yet. Ha ha ha.

If you read or listen carefully to Gloria’s SONA,  part of which says “Imprastraktura ang haliging nagtitindig hindi lamang ng kapayapaan kundi ng ating buong makabagong ekonomiya: mga kalsada, tulay, paliparan, public parks and power plants.”, you probably know that this SONA has a cost, aside from what Major Tom metioned in his blog.

Gloria proudly enumerated more than 70 (if you care to count) infrastructure projects lined up until 2010, and the total bill for these projects amount to PHP1.7 trillion – “What I have outlined today is just a sampler of our P1.7 trillion Medium Term Public Investment Program. How will we fund all these? P1 trillion from state revenues, with tax reforms and firm orders to BIR and Customs to hit their targets. P300 billion from state corporations. The balance from government financial institutions, private sector investments, local government equity and our bilateral and multilateral partners.

Now, let us do some simple mathematics. Please get a calculator so you can enjoy this.

Okay, let us proceed. Key in the following numbers in your calculator:

1,700,000,000,000.00 multiply by 10% = 170,000,000,000.00
1,700,000,000,000.00 multiply by 20% = 340,000,000,000.00
1,700,000,000,000.00 multiply by 30% = 510,000,000,000.00
1,700,000,000,000.00 multiply by 40% = 680,000,000,000.00

Incredible figures ha. My calculator can not accommodate these numbers.

What these figures represent?

Admittedly, these figures are just numbers and percentages and may mean nothing. I must agree that these are just computations and assumptions. But, given the record of our country with regards to handling our money, these numbers can tell you the immensity of how much this will mean to you, to them and to me.

Simply, these figures are the possible amount of Kickbacks, Tong, Scam, Raket, Dugas, Kurakot or Commissions that will be generated from the trillion-peso projects of Gloria in different percentages.

I might be assuming too much like most true blooded cynical Pinoy but the truth remains, whether we like it or not, our country belongs to the league of most corrupt. If you wish to think differently and assume that everything up to the last centavo goes to the intended project, that is fine with me.

Just looking at the figures above, I have the feeling that the corrupt officials, the dealers, the agents, the businessmen, the politicians and the racketeers who is or will be involved are now singing happy tunes with huge smiles in their faces that will last till 2010 and beyond?

Hindi ba kayo nagtataka why there were few politicians and businessmen who questioned the SONA of Gloria?

Well, the answer is simple. It is written in trillion pesos, part of which is the clear 12-digit giveaway.

Where is the money?

Even on worst situation, like if funds from sources that Gloria mentioned did not materialize, the government can and will still spend, just like my friend, with or without enough money. The result of this action, spending without enough money, is called Budget Deficit, the inseparable partner of Debt.

A budget deficit is defined as the amount by which an individual, business, or government’s income falls short of the expectations set forth in its budget over a given time period. In most cases, those who experience a budget deficit must borrow funds to make up the difference between projected and actual income and expenses. The borrower must pay interest on this amount, known as its debt, which further increases expenses for the following time period. In this way, budget deficits tend to grow over time with the accumulation of loans and interest payments. If a business fails to take action to correct a budget deficit and restore the balance of cash inflows and outflows, bankruptcy can result.

The Abstract of Maria Teresa Caparas’ indepth study/research paper stated that “It is a common, albeit rebuked knowledge, that the Philippine government has, for quite sometime, been spending more than what it has been earning. The outcome is that the deficit has to be financed either through local or foreign borrowing. Either way, government borrowing has its consequences, foremost of which is the increase in interest rates.[Full text here].

Does this make Filipinos happy too?

Except for the lucky few, the answer is NO!

This early, our government is running into deficits already. Finance Secretary Margarito Teves said that preliminary data showed the government missed its first half-budget deficit goal of 31.3 billion pesos by about 6.4 billion pesos. Total tax collection for the first half were estimated to have fallen about 53 billion pesos short of the 483 billion peso target.

Socioeconomic planning Secretary Romulo Neri said the budget deficit could most likely reach 100 billion pesos.

Going back,  starting from Marcos, our presidents always dreamed of leaving a great legacy to the Filipino people. Unfortunately, they are not the most beautiful or important things that we wish we could have. This is because these presidents have one common bad habit of leaving a legacy of nightmare that extends to the unborn Filipino child. That legacy of nightmare is DEBT.

DEBT, that sounds like DEATH.

The total Philippine debt as of May, 2007 was 3.82 trillion pesos (USD$84 billion).

20 Responses to “DEBT that sounds like DEATH”


  1. 1 anoba August 2, 2007 at 12:14 pm

    The picture and the dialogue fit perfectly well with what is really going on in our country.

    Increased debt means more money will be taken away from our poor citizens, in effect less services and benefits, more harsdhips, unemployment, poverty and death.

    truly, debt does not only sounds like death. It smells death.

    And corruptions cut bridges as well.

  2. 2 Zherwin August 3, 2007 at 4:48 am

    now that you mentioned it, it was Marcos who started it all, blinding us with figures sugar-coated with lies, ginaya lang sya ng mga sumunod sa kanya. if marcos can get away with it, why can’t they?

    and i don’t know how to react exactly with the government’s action on selling assets just to be able to mend the bloody low collection of taxes para lang ma-meet yung ponyemas na deficit target for this year.

    bitter ba? hehehe😀

  3. 3 Schumey August 3, 2007 at 3:31 pm

    After selling our assets and these funds run out, we will be back to square one. The BIR collected in ADVANCE last year, thus the shortfall in the collection this year. She said that her successor would reap the fruits of her labor. What she is actually saying is she will spend what is left and let the Filipinos pay for her borrowings.

    I think she will be leaving us after 2010. With all the kickbacks, she will have a very comfortable retirement.

  4. 4 bingskee August 4, 2007 at 9:11 am

    that’s why i dont watch her SONAs. why would i listen to lies?

    ngayon ko nga lang na-notice DEBT sounds DEATH..

  5. 5 Major Tom August 4, 2007 at 3:33 pm

    This is really alarming. I bet our government have overplayed that Keynesian principle of increase government spending to spur the economy. Our foreign debt is always increasing that it might reach 100 Billion dollar level in months time. And with this huge amount of debt, you can say every Juan or Maria would be indebted for number of years to become, most probably decade and just thinking about that, even just in the back of our minds, is often depressing; thereon we could become a nation of depressed individuals if we don’t stop this government’s perchance for borrowing, like in every move it would think of, they would immediately think of borrowing. And that’s really bad.

  6. 6 bw August 6, 2007 at 5:59 am

    I do agree that Gloria’s SONA has more to do with day dreaming more than anything, giving people false expectations. It sometimes boggles my mind that Pinoys look at the govt as somewhat of a provider or a welfare state when the fact is whe have one of the lowest income tax rates in the world !

  7. 7 Rowena August 8, 2007 at 4:13 am

    Hi. Nice post. I’ve watched the SONA because my kids have to to do their homework based on it (so Mommy has to watch). You’re right, we don’t have the money as of now to do all the projects because majority of the revenues we are getting are going straight to the pockets of BIR/ Customs officials and some scrupulous employees plus the intended funds for the project are sliced into the hands of the funder, lgu’s, coa, district & regional directors and the project itself. Yes I should know, I’ve worked for some of our “honorable” leaders.

  8. 8 SexyMom August 8, 2007 at 11:02 pm

    let me be the devil’s advocate, for GMA, it’s damn if you do, damn if you don’t.

    if she sits and does not do those infrastructure projects that would somehow “give comfort” to the people, she will be damned. on the other hand, making those infrastructure projects come to real as she has enumerated in various stages of completion, has caught the wrath and fury of a certain part of the citizenry–she’s damned.

    what now? WHAT CAN THE CITIZENRY ADVISE THE DAMNED GMA?

    myepinoy: well, first of all, Filipinos have a very short memory. So if she is”THE DAMNED GMA” today, after two, three or few years, she might be considered as an angel. Look at Marcos, the other Marcoses, the cronies and friends of the dictator, they are all back in circulation as if they did not rape the Philippines. May care ba ang karamihan ng mga Pinoy sa mga ginawa ng mga ito sa bansa? O talaga lang makakalimutin tayo o ibang klase tayo?

    If you will ask me, she must deliver those projects according to her SONA. If these projects are done properly without corruptions and no additional debts (i must be dreaming), good for us and for her. perhaps these might also help her record when history judges her.

  9. 9 myepinoy August 9, 2007 at 1:40 am

    According to the news that came out on Aug 2 from Pulse Asia, 21 big-ticket Philippine projects funded by foreign donor aid have incurred cost overruns totaling P36.8 billion (US$805 million) as of Jul 16 this year. This cost overrun comprises 34% of the total project cost.

    According to Sec. Neri, the payment period for the loans that funded these projects is 40 years. One lifetime according to Che Che Lazaro of Probe Team in the latest episode DAMbuhalang projects.

    Supposing these trillion projects incur a cost overruns similar to that of the 21 big-ticket projects, where shall THE DAMNED gloria get the money?

    From loan or loans with 40 years term?

  10. 10 annamanila August 10, 2007 at 9:26 am

    Hay naku. I don’t know .. those infrastructure projects look nice … and indeed well thought out infrastructure will lubricate the running of businesses and perhaps even national reunification and national security measures. I guess I am still clutching a straws and hope all these will bounce back to benefit the majority. Well the growth rate seems okay though trickling them down to the bottom sectors of the society will take some doing. Still, I know GMA is still the most hardworking president we’ve had in a long time. Sabi mo nga results oriented. Kaya ako, i don’t badmouth her.

  11. 11 tutubi August 10, 2007 at 2:08 pm

    rein in the budget deficit

    at least it was GMA who’s really working to balance the budget getting her the nod of economist

    it’s not an easy task

  12. 12 manifesting money July 16, 2011 at 4:31 pm

    I don’t know, I have trouble concentrating on it, something doesn’t seem to be right. Any clues? “DEBT that sounds like DEATH myepinOy’s bLOG”

  13. 13 budget money August 2, 2013 at 2:57 am

    Your method of telling all in this paragraph is truly fastidious, all be capable of easily be aware of it, Thanks a lot.

  14. 14 community philanthropy August 2, 2013 at 3:51 am

    What’s up, its pleasant piece of writing about media print, we all be familiar with media is a wonderful source of facts.

  15. 15 PayPal capital loans March 10, 2014 at 5:04 am

    Hi it’s me, I am also visiting this website daily, this website is actually nice
    and the users are really sharing nice thoughts.

  16. 16 fellowkr.com September 1, 2014 at 3:16 am

    You just need to know what you need to be prepared, and where to turn for help.
    Further, to judge the financial strength of the individual
    or the business, the finance company may require the certified copies of tax returns
    for a particular number of previous years.
    A car can give you an edge to achieve your dreams
    by putting you on wheels. they are in fact just specialized lenders that are experts
    in inventory and purchase orders and letters of credit.

  17. 17 family vacation dmv secretary of state illinois locations September 7, 2014 at 10:44 am

    An academic dude ranch is the third – and latest-
    choice. A quantity of these apartments are near to the charming coast
    with some even on the beach. That means no worrying about whether theres enough money for
    this tennis game or that boat trip. With the tightening of the
    average family budget and the chaos of past family vacations, many parents are left wondering if they can still afford the yearly vacation.

  18. 18 serviced apartments los angeles ca September 20, 2014 at 10:20 am

    It is true that presence of these facilities is more noticeable in metropolitans, but it is
    also becoming popular in comparatively smaller cities.
    This helps in selecting a location that can optimize your trip to London. With so many more attractions to be explored,
    Edinburgh has the magic of making your holiday or business trip very interesting and exciting.
    You can cook for yourself in your serviced apartment and
    enjoy the food of your choice.


  1. 1 Gloria Arroyo: I am not perfect! « myepinOy’s bLOG Trackback on February 24, 2008 at 7:55 pm
  2. 2 Day of mourning today, really? « myepinOy’s bLOG Trackback on November 26, 2009 at 1:42 pm

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s




Tweets

Categories


%d bloggers like this: