By BENJIE OLIVEROS
Bulatlat perspective
Filipinos have this superstition that one has to start the new year right because that would reflect on his or her fortune for the rest of the year. This is why deaths, illnesses, quarrels, having no money at the beginning of the year spell doom for the unlucky one.
If this is to be believed, then Filipinos are heading for a bleak year despite the supposed rosy economic growth figures and the natural optimism of the Filipino people.
Why?
For one, we began the year with high prices of oil products, including LPG cooking gas, meat and vegetables, and groceries. Prices of food and other consumer goods are generally high during the Christmas season but go down soon after. But as of now, there are no signs of prices going down significantly.
Add to this the increase in power rates. Power rates would have spiked by P4.15 per kWh if not for the temporary restraining order (TRO) issued by the Supreme Court. However, the TRO lasts for only 60 days beginning December 23, 2013 when it was issued. The Aquino government has no intention of stopping the rate hike.
In fact, a December 28 Philippine Star report revealed that Energy Secretary Carlos Jericho Petilla is even asking electric company Meralco to appeal the TRO.
Secretary Petilla was quoted by the Philippine Star report as saying, “If Meralco cannot collect, it may have to borrow money and if it borrows, there will be interest, which may add to electricity cost, so that’s the reason why I want Meralco to appeal the TRO so that there would be no interest cost.”
The increase in power rates, resulting from the increase in generation charges, is supposedly just a pass-on cost that Meralco is charging consumers. The generation charge is the cost of electricity that Meralco buys from power producers. This supposedly increased because of the maintenance shutdown of the Malamapaya natural gas platform, which also coincided with similar shutdowns by several power plants in Luzon. Well, Meralco has been notorious in jacking up its pass-on costs, but assuming Meralco is not to be blamed for the spike in power rates, then who is?
Some groups suspect that power producers connived to shut down operations at the same time to cause an increase in power rates. This has yet to be proven but is not far-fetched. Companies controlling basic commodities and services such as power, water, oil, and even the supply of rice have been caught price-fixing before.
But, granting for the sake of argument that power plants did not shut down operations purposely to push electricity rates up, could the recent spike in rates be avoided?
Yes, with better planning. Malampaya, as well as the several power plants in Luzon that went through maintenance shutdowns, could have not done so at a whim. Maintenance shutdowns of factories are planned way ahead of time, at the minimum, during the annual corporate planning. And surely, the government was informed about this. The Aquino government could have instituted measures to avoid a spike in power rates such as entering into agreements with power plants that have not planned maintenance shutdowns or setting a ceiling for rates, even temporarily. But the Aquino government chose not to do anything about it because of poor planning or incompetence and/or lack of concern for the welfare of consumers.
Also to increase are the premiums being exacted by the Social Security System (SSS) and PhilHealth. The Aquino government has made it clear that it would not stop these two quasi-government agencies from increasing its exactions and even justified the need for it. The funds of SSS, for example, are, according to the agency and President Benigno Aquino III himself, could no longer be sustained without an increase in exactions from its members. At the same time, the Aquino government justified the hefty bonuses given by the executives of these two agencies to themselves citing their supposed “good performance.” The logic of these two things escapes the ordinary observer. Their funds are unsustainable and yet the executives of these agencies are doing a good job? Aren’t these contradictory?
Then there is the impending hike in fares of the MRT and LRT commuter train systems. The Aquino government would have wanted to implement this earlier if not for the strong protests led by progressive groups.
These increases in the prices and rates of basic commodities and services are adding to the already heavy burden being borne by ordinary Filipinos, and the year has just begun. The response of the Aquino government to these has been consistent: either the government justifies it or says that it could not do anything about it.
Is it true that the Aquino government could not do anything about it?
Take the case of Iceland. In 2008, Iceland suffered its worst economic and political crisis. The three largest privately-owned banks in Iceland were on the verge of collapse and were placed under receivership. The value of the national currency Krona nosedived; Iceland went into severe recession.
Iceland imposed capital controls and followed IMF prescriptions as part of its bailout program, such as raising taxes. Iceland prioritized repayments and placed as last priority foreign creditors and hedge fund managers or financial investment houses.
Now, the newly-installed Icelandic government is in the process of implementing tax cuts and mortgage relief in the amount of 24,000 euros per household. This, of course, elicited warnings from the International Monetary Fund and the Organisation for Economic Cooperation and Development, but earned praise from progressive economists.
A January 9, 2014 report from the Guardian with the title Iceland rises from the ashes of banking collapse: Populist programme of new government includes a squeeze on foreign creditors as country emerges from years of instability quoted Paul Krugman as saying, “”Where everyone else bailed out the bankers and made the public pay the price, Iceland let the banks go bust and actually expanded its social safety net.”
Nobel prize winner Joeseph Stilitz reportedly said, “What Iceland did was right. It would have been wrong to burden future generations with the mistakes of the financial system.”
“Iceland let the creditors of its banks hang. Ireland did not. Good for Iceland!” – Financial Times economist Martin Wolf.
The Icelandic government is able to go against the tide because it is determined to do so. What the government of Iceland did demonstrates that it is all a matter of priorities and perspective. If the government wants to and has the political will to fight for the interests and welfare of its citizens even if it would catch the ire of multilateral agencies such as the IMW-WB, the World Trade Organization, the OECD, among others, it could do so. 
