The election season has started in the Philippines, with the Commission on Elections (COMELEC) finalizing the list of candidates vying for various positions in the public office. While the aforementioned commission is performing its stipulated duties and powers afforded to it by the 1987 Constitution, candidates running for nationally-elected positions are creating their own platforms where they propose solutions that attempt to address various economic, political, and social malaise that the country is suffering from. These solutions vary, whether they are legislative in nature or executive in form, depending on which position they are vying for. It sounds complicated, but this pandemic-induced economic contraction further adds convolution to how politicians format their electoral promises in a manner that earns the trust of the electorate.
One of the biggest words that will definitely come out would be dole outs, or more commonly known as “ayuda”. These dole outs already come out in two general forms: (1) through cash distribution programs or (2) through relief goods and items that include food, clothing, and other necessities required for daily living. The former, which is the more common form of ayuda, is when an amount of money is directly given in cash by the government. With COVID-19 destroying livelihoods and employment opportunities from the various sectors of the Philippine economy, it is doubtless that these dole outs have helped many Filipinos wade through the waves of lockdowns, community infection transmissions, and economic downturn.
Outside the Philippines, the Global North did not hesitate to power up their money printing machines, which can be easily accessed by their citizens in various forms. In neighboring Japan, the administration of then Prime Minister Abe issued a one-time JPY100,000 (around Php50,000) financial assistance per person that is available to all residents. In addition, the Go To campaign was also launched to jump-start the tourism industry which suffered tremendously due to the pandemic. Restaurants were also given a monthly stipend assistance, provided that they strictly follow COVID-19 guidelines in their business operations. Beyond the Pacific Ocean, the administrations of then President Donald Trump and President Joe Biden pushed for pandemic alleviation packages worth trillions of dollars which were deliberated in their respective legislative bodies in the United States. The European Union has also created a solidarity fund that aims to provide financial assistance towards their fellow member states hit hardly by the pandemic. Indeed, helicopter money was being rained down on these liberal democracies and to their constituents.
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When one hears of these generous dole outs in first world countries, it is tempting for many Filipino politicians who wish to be elected to promise more financial assistance towards their potential voters come 2022. They might publicly announce that they will help the public through a welfare system that will literally put cash into the pockets of less-fortunate Filipinos. Unfortunately, with a relatively fiscally illiterate electorate in the Philippines, many voters would end up becoming victims of their own right to suffrage specially when these elected politicians engage in underhanded public or private transactions. Nevertheless, the three syllables forming the word “ayuda” sound like music to the ears of gullible voters. Furthermore, some sectors of the society applaud this kind of wealth distribution system, which I personally think is more detrimental in nation-building.
In economic terms, dole outs can be classified as a method of wealth distribution performed by the government that aim to provide temporary financial relief to the members of the community. The hope in this is that the channelled money would ramp up consumption of goods and services, thus stimulating the whole economy. Leftist politicians and left-leaning groups would pronounce that wealth distribution is a method of promoting social justice, while Catholics and other Christian denominations would preach that the virtue of generosity is manifests itself in wealth distribution. However, I beg to disagree with these individuals, specially when one considers how inefficient and ineffective doling out systems are a waste of taxpayers’ resources. Dole outs are mere band-aid solutions that are never meant to last. Distributing wealth does not generate wealth and, instead, diminishes its intrinsic value.
British stateswoman Margaret Thatcher in her final book Statecraft, identified five important factors that can make capitalism function well. These are private ownership, culture of entrepreneurship, rule of law, competition, and limited government intervention. All of these factors can also be found in Friedrich Hayek’s The Road to Serfdom, which denounced socialism and collectivism. As a consumption-based economy, the Philippines has the potential to make capitalism work. It is therefore imperative for the country’s policy makers to adhere to these five stipulations. The direct beneficiaries of this approach would be all Filipino citizens and residents, who are both consumers and producers of various goods and services in their own right in the free market.
It is paramount that elected officials be sensitive and humane to the needs of the electorate. However, my proposition is to ascertain that these dole out programs would target recipients who need the most assistance, while aiming to increase the productivity of the general economy by creating an environment fertile for businesses that generate employment. A more circumspect view of balancing various needs is a must, since a spiral of uncontrolled cash circulating in the economy would dilute the country’s economic gains as its players battle against the damage caused by the pandemic. Of course, aggressive investments paired with government assistance towards social infrastructure that improves connectivity while reducing bureaucracy is also highly ideal.
However, the government’s resources and powers aren’t unlimited specially with the self-inflicting restrictions stipulated by the current constitution regarding foreign direct investments. Many constitutionalists quickly point to nationalism, which hasn’t even brought food to the tables of the marginalized sectors of the society. Intentions are noble, but that is where they end. What we need is to elect candidates who will open up the Philippine market by advocating structural changes that correct the missteps caused by the current constitution. It is through wealth generation — not wealth distribution — that every Filipino’s living standards would improve.
With calls for more effort regarding wealth distribution getting louder and stronger in the elections, the electorate should never fall victim to these skewed and distorted electoral promises that cause more harm than what is initially intended. We should be resilient against the temptations of enlarging the government, lest we fall as a country of dependent mendicants.
A no one who enjoys the fun things of life in private.
A believer of freedom, capitalism, and conservative brand of politics.
A no one who cares less about popular public opinion.
A believer that life can be better, if every one is a tad more responsible.