Monday, June 17, 2013

Pol. Ideology 43: On BIG Government Fetish

A friend in our UPSE Alumni yahoogroups, a senior government official, asked if my critique of BIG government has any reference to him/her. I said NO, my critique is always on the institution, never on any person.

I myself was a fan of BIG, socialist government more than two decades ago. I wanted the fruits of the profit system and capitalism to be confiscated by the state, to be given to the poor including the lazy and irresponsible people.

I prefer to attack institutions that are creators of many urban legends, like the UN, WWF, Greenpeace for their "man-made" or anthropogenic global warming and and climate change scam. The robbery scam includes endless global climate junkets, endless environmental regulations and taxation, endless climate loans, creating more climate bureaucracies, energy rationing and cronyism, among others. Like the ADB's $300 M e-tricycle and other rackets. And the perennial planet saviors who enjoy high-end trips for their endless climate junkets to "save the planet" at zero cost to their own pockets.

World reknown climatologist Dr. Roy Spencer has a good chart made recently, global temperature projections vs actual temperature, 1975-2013, STILL Epic Fail: 73 Climate Models vs. Measurements, Running 5-Year Means

The planet saviors and climate scammers do not recognize that their guesses and projections of an "ever-warming planet" are non-truthful.

About the "fish tax" proposal by Mike Alunan (see Tax Cut 16: Conserving Fishery Resources by Taxing Demersal Fish Catch?), such proposal is not alone in being idiotic. I think more than half of all taxes and mandatory fees, all created by laws, are idiotic too. For instance, Hong Kong and Singapore are able to manage their economies (G/GDP ratio of about 20+%) with just four to five different taxes and fees per year for all private enterprises, vs. 47 different taxes and fees per year in the Philippines. Well, monthly payment of SSS, PhilHealth, PagIBIG were counted 3x by the WB-IFC in their "Doing Business" annual reports for the Philippines, so remove the 24 payment, there are still 23 different taxes, fees and mandatory contributions per year, still a lot of bureaucracies and time spent going back and forth to various offices, national and local.

As for labeling, I think socialists should be proud when they are labeled as such, so long as they are intellectually honest. Rewind two to three decades ago, I was very proud to call myself or being labeled as a Marxist socialist, or plain socialist then. I was fighting for the downtrodden and those exploited by the capitalist profit system, why couldn't I be proud? 

The same way, statists should be proud also when they are called as such, provided they are intellectually honest. They have deep distrust, deep suspicion, of the market system and civil society volunteerism system to fight poverty, that is why they invented or supported various forms of taxation, regulations and prohibitions, so that the state will centrally plan things for everybody. People who are rich, the state will confiscate more of their income, savings and assets (income tax, real property tax, vehicle registration tax, VAT and excise tax on their gasoline and frequent land trips, final withholding tax on their bank interest income, doc stamp tax for their business transactions, travel tax for their frequent foreign trips, etc.). In contrast, Mang Pandoy, Mang Pundoy, Mang Pindoy, etc. are very poor, the state should subsidize everything for them (free education for their kids, free PhilHealth and free hospitalization in LGU or DOH hospitals, free or subsidized housing, free land ownership if they are in agrarian reform-covered lands like Hda. Luisita, free seeds for their farms, free cash transfer, etc. Why can't they be proud of such bleeding heart concern for the poor?

A friend asked what do I mean by BIG government as it does not seem to apply to the Philippines, that certain departments are actually understaffed and underpaid, like the Department of Finance (DOF) and the National Economic Development Authority (NEDA).

Well, it is very easy to spot if a government is BIG and bureaucratic or not. Try putting up or ask someone who is putting up, a simple shop -- bakery shop, cake shop, internet shop, salon/barber shop, etc. If the government says NO unless you get dozen plus permits from national (BIR, DTI/SEC, FDA, etc.) and local governments (electrical permit, fire department permit, health and sanitation permit, etc.), and pay various taxes and fees even before you open and earn a single revenue, then that government is BIG and bureaucratic enough. 

For instance, business bureaucracies in the Philippines is comparable to those in socialist Vietnam.

Stealing, kidnapping, abduction and rape, extortion, murder, etc. are real crimes. Government should give these criminals all hardships, all prohibitions. Entrepreneurship and job creation is not a crime. Government should not penalize entrepreneurs.

Documents and proof, perhaps this 24-slides presentation can help,
How to shrink a big and bloated government, perhaps this short article can explain, 

Prof. Ben Diokno of UPSE once argued that DBM + NEDA + DOF should be merged, abolish the first two departments and many of their functions can be absorbed by an expanded DOF. I like his proposal.

BIG government is not a disease of the present or immediately precedent administration. So no one in particular -- not Sec. Purisima, not PNoy, not Gloria, not Erap, etc. should be singled out. BIG government and statism is a philosophy, it is a message that ever-expanding the state bureaucracies, spending, taxes and regulations will be helpful for the poor. This philosophy  is adopted by all administrations in this country, and by many administrations and governments in other countries. It's just that some administrations would expand the government much faster than others.

Meanwhile, the P1 trillion budget was reached during Gloria's time. The P2 trillion budget was breached this year. Next year, will it reach P2.3 trillion? 

I saw one presentation by the DOH. From P42 B in 2012 to around P53 B this year, they expect to have P87 B next year, wow. The DSWD and its conditional cash transfer (CCT) program will also have an ever-jumping budget. And the DND-AFP, they want more jet fighters, more warships, more bombs against the Chinese and Taiwanese over those small islands and shoal, so we expect their budget to rise by additional P20 or P50B over this year's budget?

I don't see any department having a flat or reduced budget the following year. So a P2.3 to P2.4 trillion budget in 2014 is highly possible. And that means up to P2.4 trillion of taxes and borrowings to be passed on to current and future taxpayers, mainly from the private sector.

See also: 
Pol. Ideology 39: Thatcherism, April 10, 2013 
Pol Ideology 40: On Social Darwinism, May 23, 2013 

Pol. Ideology 41: Engage Government or Not; Minarchy or Anarchy, June 05, 2013 

Pol. Ideology 42: Anarchy is Impossible Even in Theory, June 11, 2013

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