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Wednesday, September 15, 2004

Interim Solution

The Philippines has complex problems and require creative solutions to solve them. unfortunately to solve these problems, both the leadership and the people must agree to resolve the problem. Now, that is indeed an optimistic dream.

here are some ideas on how to solve the problem at hand... and these thoughts are at best patchwork solutions but all require that our people get their act together. i'm sure a lot of people have other great ideas out there. anyway, here they are...

A. Control spending
The first step really is to Zero Out the budget. It must truly be a credible reform agenda. Everyone must agree to Zero Out everything, ruthlessly. Every agency back to square one and then slowly pick out the important items that need to be there.

I know, I know--- such obvious optimism and such an idea doesn't even boarder on reality. On the ground the political reality is that pork is needed to just begin to send an agenda across. Its all about politics really. But the whole point is not to completely remove spending together--- that in itself brings about even greater problems.

The point is to reduce spending just a little bit over time as an interim solution (I can not but stress that enough... Such a measure is an interim and patchwork solution only). This in itself sends a credible message to the international community and to financial institutions that we're on top of the situation.

B. Sell or close government corporations
the next obvious step is to reduce government interests in business that it shouldn't have any interest at all in the first place. Sell government shares and interests in private corporations like San Miguel, PLDT, PAGCOR, Philippine Airlines, Petron, etc, etc. and truly create an environment for the entrepreneur. I mean, sell everything regardless whether or not that government-held or controlled corporation is making money or not.

If no one will buy the corporations, sell its asset.

The whole point is to get out of business where government should not have business at all and force people to find potential in these markets. If there is a need, they will come and people will pay good money for services that benefit them. Ergo, you have two telecom companies and one of them is actually making more money than its parent telcom company. If this industry can capitalize on that then so should others.

c.begin to educate the masses
Government must undertake a program of educating people that it is not government's role to save them from poverty. Rather it is government's role to cultivate the environment wherein people can save themselves from poverty.
Obviously this is an end-goal and not a starting point.

D. Employees, wages and graft

1. Create mandatory retirement and educate those people going into early retirement on possible business ventures that they may take. This accomplishes two things--- prevent them from being unemployed and at the sometime create more businesses.

2. Increase the salaries and wages of government employees across the board. It is one way of combating grab and corruption. As the level of government employees shrink to reasonable levels, then raise those wages to reflect the times.

yes, in the interim we will see a dramatic rise in unemployment. We must destroy before we can create after all.

3. Establish by law a commission basis for all government employees. Let us make graft legal and manageable in the med-term. This was actually a suggestion that I learned from the president of one the companies operating out of Makati. Graft is a fact of life in the Philippines.

empower the anti-graft commission some more. This will allow for greater teeth in the fight against graft.

E. Increase wages of the judiciary
we need more courts of laws and honest men and women in those courts and money talks.

these are interim suggestions on how to stem the tide.

the next post will deal with long term suggestions.