President Gloria Macapagal Arroyo’s declaration that the coming Christmas should be a happy one for Filipinos is likely to be greeted by hoots of derision by people who’ve seen the prices of basic commodities rising in the last few months, and who have had to deal with them by tightening their belts, or by simply doing without. December 25 is likely to be just another date in the calendar for these Filipinos–and their number is legion.

Eight out of ten Philippine households are hungry, the Food and Nutrition Research Institute of the Department of Science and Technology survey found last August. Although the FNRI-DOST survey confirmed a suspicion derived from anecdotal evidence that there is indeed hunger in the Philippines as there is in Bangladesh and certain African countries, the discovery that it afflicts as much as 80 percent of Philippine households was shocking to many people, except for the Communist Party, which has always said that there’s more poverty in this country than doctored government statistics reveal.

The initial shock, however, led to a second. You don’t need a Ph.D in economics to assume that with little or no money to spend on something as basic as food, eight out of ten Filipino households have even less for decent housing, education, or medical care.

The immediate solution to hunger is work–but beyond merely working, individuals must also be paid enough. The bad news for workers (it isn’t, for employers or the government) is that wages have been continuously falling in terms of purchasing power as prices rise, but that the Philippine government, in concert with most employers, has refused to heed the demand for wage increases.

As of January this year, said Danilo A. Arao of the online magazine Bulatlat (“Despite Government Figures, the Poor Are Now Worst Off,” Volume IV, Number 6, March 7-13), an average Filipino family of six needed between P12,950 to P22,440 a month to survive, depending on which part of the country they live.

A private-sector worker in metro Manila, said Arao, needed P593 a day to adequately support his family, but the minimum daily wage was P280, or P6,160 a day. In metro Manila, where a family of six needed P17,790 a month to survive, this meant a deficit of P11,630.

The worst-off in the entire country were workers in the Autonomous Region in Muslim Mindanao (ARMM), where a family of six needed a whopping P22,440 a month to survive. And yet the minimum wage in the region was less than in metro Manila at P140 a day, or P3,080 a month–a deficit of P19,360.

Economists say the inflation rate last October was likely to have risen to + 7 percent, up from 6.9 percent in September, and more than double the 3 percent rate in October 2003, as a result of increases in the prices of gasoline products and electrical power. Wages, however, have seen only meaningless increases since the start of the year, despite demands for a P125 across the board daily wage increase for private- sector workers, and a P3,000 monthly increase in the wages of public sector workers that go back to 1999.

While wages have remained practically stationary–the last wage increase this year was a paltry P25 per day, or barely enough to pay for daily transportation to and from work in some cases–prices have risen so much that the value of the peso has been cut by half what it was in 1994. This means that the already low wages most workers are receiving have been cut in half in terms of purchasing power: a 2004 peso can now buy only half what it could in 1994.

Mrs. Arroyo’s statement that Filipinos will have a happy Christmas was based on her claim that the fiscal crisis she announced last August has been resolved. It is still a problem, but is no longer a crisis, in the sense that the government no longer faces “a critical constraint” in its capacity to meet its obligations, because “the resolution”–new and higher taxes–“is under way.”

The opposition found Mrs. Arroyo’s claim to be incredible–and who would not? Has the government indeed increased its capacity to pay the loans it had been merrily incurring since 2001– and has it reduced its existing financial obligations, for example the national debt, within the space of two months?

One of Mrs. Arroyo’s own economic advisers, however, was only a little less skeptical than the opposition over her claim that the crisis has been resolved. What’s more, Albay Congressman Joey Salceda warned that her announcement could lead to complacency by making the passage of “needed” tax legislation seem less urgent.

Salceda said his “biggest worry is that we may be prematurely lifting public pressure and intellectual basis for action,” since more revenue-raising bills have to be passed in Congress to prevent the total collapse of the economy economists say could happen within two to three years.

Whether the crisis has indeed been resolved, is on the way to being resolved, or is far from resolved, however, the fact remains that it is the availability of money for food and other necessities that would make a difference among the 80 percent of Filipino households that say they’re hungry.

The standard for a “happy Christmas” for this overwhelming number would range from merely having enough food to eat during the season or perhaps just on Christmas day itself, to having enough to eat and being able to buy the kids cheap toys. To suggest that either can happen in most Filipino households this Christmas, despite massive unemployment and inadequate wages for those employed just because the fiscal crisis “is no longer a crisis but is now just a problem” defies reason.

What doesn’t defy explanation is why the Philippines has been in perennial crisis, financial or otherwise.

Before she made her “happy Christmas” statement, Mrs. Arroyo was carrying on in Malacanang about how, last August, she had merely spoken of a fiscal crisis, and “not a financial crisis, not an economic crisis, not a political crisis.”

If no one else has noticed, the entire country has been in crisis since 1946. The present crisis–and it is political as well as economic and social–may be the worst so far, but isn’t entirely new. Since 1946 the country has witnessed that crisis intensifying from one year to the next, first in terms of the overall quality of life of millions of Filipinos as a consequence of unarrested economic decline; second, in terms of the growth of corruption and inefficiency in governance; and third, in the social unrest whose dimensions have steadily grown in the last fifty years.

The key to the Philippine crisis is the crisis in leadership and governance–the inability and unwillingness of those in power from 1946 to 2004 to chart an independent course of economic development, and their reliance instead on the course identified by the US-dominated international lending institutions.

As economist Alejandro Lichauco has stated, however, this course has been assured by US intervention in Philippine affairs–the election through the corrupt political system, or their installation through other means, of leaders so-called whom Lichauco describes as members of the collaborator class that developed during the Spanish and American colonial periods.

It is these leaders who control the political system, and who– despite the worsening of the Philippine crisis to the point where 80 percent of Filipino households are hungry– refuse to strike out on alternative paths to economic development either out of lack of imagination, fear of displeasing the international lending institutions, or both. It is these same leaders who will not even consider negotiations over the country’s debts, but who instead insist on “solving the crisis” through new taxes that the poor will have to shoulder, while the tax dodgers and corrupt generals that are their allies live in obscene luxury.

There’s no happy Christmas of lights and laughter in this state of darkness. As it has been in the past there’s not even likely to be any Christmas to speak of for most Filipino families. The government should stop kidding itself. Better yet, it should stop kidding the people.


Prof. Luis V. Teodoro is a former dean of the University of the Philippines College of Mass Communication, where he used to teach journalism. He writes political commentary for BusinessWorld.

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