MeTA 18: More Financial Independence, More Stakeholders Participation

The Medicines Transparency Alliance (MeTA) Philippines will be conducting meetings and fora next year related to health transparency and its own financial sustainability. It is a UK Department for International Development (DFID) funded project conducted in seven developing countries including the Philippines. Thus, while MeTA is classified as a non-government organization (NGO), technically it is a government-funded organization (GFO).

Despite this fact, MeTA-PH is providing the regular venue for multistakeholder discussions on medicines and healthcare in general in the Philippines. Below, in one of the big meetings of MeTA held in Makati, early July 2014.

The Department of Health (DOH) Advisory Council for the implementation of RA 9502 (Cheaper Medicines Act of 2008) seems to be dead, at least temporarily. Zero meeting this year.  There should have been about two meetings, like the  one in mid-July 2014, but in both cases, they were cancelled. And no reason/s is/are given why the meetings are cancelled. I suspected that  the July meeting was cancelled because the  DOH got busy with the Disbursement Acceleration Program (DAP) controversy where the DOH got P3+ billion of extra funding from that program. When DOH Under Secretary Mads Valera was still there, the agreement was a quarterly meeting. When she left the DOH, the meetings were also gone.

I think there is also zero meeting by the Congressional  Oversight Committee on RA 9502 this year, the legislators (House and Senate) perhaps just divided among  themselves the P10 M/year average budget of Congressional Oversight Committees. Another fiesta time for Congress.

  

So if DOH cannot provide the regular consultation and dialogue process, MeTA should fill that vacuum. And Yes, MeTA should go for a real civil society and NGO status, not largely GFO. The annual dues for all members, corporate, institutional and professional affiliates, individuals, should proceed and not sidelined. Government/multilateral money (UK-DFID, WHO, etc.) can help finance the overhead expenses but the regular fora and conferences should be internally generated. Many local pharma companies, innovator and generics, can co-sponsor certain events. Participants can also pay minimal registration fees, and so on.

Below, another MeTA meeting held in February 2014. Both photos I got from MeTA facebook page.

Past President of the Philippine Pharmaceutical Association (PPhA) Leonie Ocampo noted that medicines are not given due attention in protecting their integrity in the supply chain  Rather, quality (transport, storage, dispensation, etc.) is sometimes sacrifice because medicines are  used as a political tool. Thus, the need for a multistakeholder involvement to prevent their wastes, advance rational and responsible use of drugs. And the need for better system in the procurement, warehousing, distribution, and use of medicines.

Tonight over dinner, I talked to a friend whose wife is a cancer survivor. He shared that his wife's doctor told him that until about 10 years ago, the survival rate of his wife's cancer at stage 4 was only about four percent (ie, around 96 percent mortality). Now with new treatments, survival is more than 50 percent. Wow, in just 10 years! But her anti-cancer medicnes are expensive, something like P70,000 every three weeks for about one year. Good that they are both rich, they can afford it and recoup that money once the wife goes back to full time work. I think that in 10 years time, that P70k (DOF/BIR gets at least P8K of it in VAT alone) can go down significantly. This chart is true.

A stronger and more financially sustainable MeTA-PH is a good springboard for dynamic multi-sectoral discussions and dialogue for more stakeholders participation, if not consensus building. I am not hopeful of the Advisory Council now to continue big multi-stakeholder participation given the recent and on-going politics at the DOH.

In our book, “minimal government = maximum civil  society”. That is why civil society organizations (CSOs) should be as independent of government as much as possible. Civil society is about volunteerism while government is about coercion. One can  say that government is the “uncivil society” :-) Note that in government, things are  done by coercion, with fines, penalties and even  imprisonment for  violations, Thus, the drug price control  policy, the mandatory and forced discounts for all senior citizens including the rich and super-rich ones, are bad policies but they remain in force until now. And even if people are not happy with the 32 percent (max rate) mandatory withholding tax for fixed income earners, they are forced and coerced to send 1/3 of their monthly or annual  income to the government.

Dynamic and independent CSOs can point out certain mistakes of more government interventions and unnecessary regulations.

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See also:
Health Transparency 14: IMS-CHAT Meeting, April 18, 2013, Friday, July 12, 2013 
MeTA 15: Forum 2014 on Healthcare Ethics and Transparency, January 30, 2014 

MeTA 16: Day 1 of Conference 2014, February 11, 2014 

MeTA 17: CHAT General Assembly, March 2014, March 31, 2014

ETHIKOS 1: MeTA-PH, PCPI, PHAP and FDA on launching, March 30, 2014

ETHIKOS 2: Pharma Companies and Patients, April 01, 2014

CSOs and State 12: From NGOs to GFOs

This is my article for the online magazine today, refreshing the page. Original title is Civil Society and the State.
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Civil society, like many other social concepts, has a varying definition for different groups. There is no single, “unanimous” or “consensus” definition of the term. And very often, the definition is patterned after the social or political philosophy that a particular group adheres to.

Take the following definitions of “civil society”:

1. Civil society is an invention to correct state failures and inefficiencies, later lambast market's self-correcting mechanisms (such as de-monopolization of industries through deregulation & more competition).

2. Civil society is a cultural phenomena and has other tasks aside from a mere focus on economics. It does not exist just for the market. To balance out market imperatives is only one of its functions.

3. Civil society role is to encourage and empower individuals and citizens to take on more personal and parental/guardian responsibilities in running their own lives. The principle of subsidiarity says that things that can be done better by the lower level of social organs or entities should not be given to higher social organs, things that can be done by the individual should not be given to the government.

(Above three definitions lifted from CSOs and State 10: The Role of Civil Society)

4. Civil society is the arena outside of the family, the state, and the market where people associate to advance common interests. It is sometimes considered to include the family and the private sphere and then referred to as the "third sector" of society, distinct from government and business. Dictionary.com's 21st Century Lexicon defines civil society as 1) the aggregate of non-governmental organizations and institutions that manifest interests and will of citizens or 2) individuals and organizations in a society which are independent of the government.

(Wikipedia definition)

5. Civil society is as a "third sector," distinct from government and business. In this view, civil society refers essentially to the so-called "intermediary institutions" such as professional associations, religious groups, labor unions, citizen advocacy organizations, that give voice to various sectors of society and enrich public participation in democracies.

(Definition from www.civilsoc.org)

6. If all means of decentralisation, deregulation and privatisation have been implemented and citizens have been involved as comprehensively as possible, there is nothing to stop the definitive self-administration of citizens. A civil society has emerged.

(See CSOs and State 4: Local Government and Civil Society)

It is possible to find a hundred (or more?) definitions of civil society, along with their respective role in relation to the government, private enterprises and individuals. I am taking the liberal definition of the term. The 3^rd definition above is actually mine. And this clashes with the mainstream or dominant definition, that civil society organizations (CSOs) exist to fill in the gap by government inefficiencies -- note that they do not want to use the term “government failure” while frequently mentioning “market failure” -- in addressing various social and economic problems, from garbage to health to poverty alleviation.

In the mainstream definition therefore, there is a close if not symbiotic relationship between government and CSOs. A big and interventionist government is consistent with a big and interventionist civil society community, they often conspire to harass what they think is the source of various social ills – the private enterprises, corporations big and small, businessmen and capitalists. So that in this symbiotic relationship, many CSOs get various contracts and funding from government – local, national and multilateral or foreign aid. But CSOs are supposedly “non-government” groups and organizations; when they get huge funding from government, they become government-funded organizations (GFOs).

The Department of Budget and Management (DBM) has released a new regulation, National Budget Circular (NBC) No. 536 dated January 31, 2012 or just two weeks ago. It is called “Guidelines on partnership with civil society organizations and other stakeholders in the preparation of agency budget proposals.” The DBM has created a “CSO Desk” that will monitor the initial 12 departments and 6 government owned and controlled corporations (GOCCs) that will be covered by NBC 536, so that those departments and GOCCs are required to involve CSOs in their budget preparations.

 I attended the DOH-DBM meeting with CSOs about this circular last February 14, 2012. All CSO leaders and representatives involved in health introduced themselves, their organizations and their specific interests on public health issues. As expected, our group, Minimal Government Thinkers was the odd-man-out because we always link rights with responsibilities, entitlements with obligations, and delineate which healthcare services are personal and parental/guardian responsibility and which ones are government responsibility. I emphasized that people who over-smoke, over-drink, over-eat and over-sit cannot just assert that “health is a right” because they did not recognize that “health is a personal responsibility” too. It was good to see a number of heads among the participants nodding after I spoke. 

I observed later how some CSO leaders would use the occasion to lobby for more DOH support if not funding for their specific advocacies. And this is part of the process by which NGOs become GFOs. I think the appropriate term for that will be "CSO Insertion" to differentiate it with "Congressional Insertion" and pork barrel in the national budget that many NGO leaders and the public so dislike.

 Government is very often the arena of irresponsibility and hypocrisy. Of living beyond one’s means, of spending much larger than income and revenue, and resorting to endless borrowings to finance the funding gap, year in and out. The continuing financial turmoil worldwide is very much caused by government fiscal irresponsibility and huge public debts. From north America to Europe to many Asian economies. One can count in his fingers the number of governments that are not heavily indebted, say with public debt of 15 percent of GDP or lower. The bulk of these governments have debt/GDP ratio of 30 to 200 percent, and such ratio is still understated because contingent debts (debts by government corporations and financial institutions guaranteed by the national or central/federal government), as well as local government debts (provinces, states, cities) are often not included.

When CSOs become indebted and dependent for funding with government, their capacity to fiscalize and criticize the government for its excesses and wastes becomes limited. This is something that CSOs should try to avoid as much as possible.

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See also:
CSOs and State 7: Public School Library with Minimal Government, BftB, June 29, 2009

CSOs and State 8: Gawad Kalinga, Health NGOs and Taxes, September 19, 2009

CSOs and State 9: The Global Fund and Corruption by Some Phil. Health NGOs, March 10, 2010

CSOs and State 11: Rights and Responsibilities, Liberal Civil Society, July 11, 2010

CSOs and State 11: Rights and Responsibilities, Liberal Civil Society

(This is my article for www.thelobbyist.biz, July 10, 2010 with original title, "More Statist than the State")
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A statist view is one arguing that things and social processes, as much as possible, should be done by the State and not by individuals, households, their voluntary organizations, or private enterprises. This view therefore, belittles if not removes the role of personal and parental responsibility in running our own lives, our own households, our own community.

There is an often-quoted phrase, “more popish than the pope”, to refer to persons and institutions who seem to be more fundamentalist in Catholic belief than the Pope. The phrase “more statist than the state” may as well apply to people who seem to be more fundamentalist in their belief of the big role of the state than the administrators of the state itself.

In my personal observation, these “more statist than the state” individuals and leaders have certain characteristics.

One, they are seldom found in mainstream political parties. Rather, they are found among mainstream NGOs and civil society organizations (CSOs), media and the academe. Check for instance the paper, “Why do intellectuals oppose capitalism” by Robert Nozick, and I wrote a brief discussion about the paper here, http://www.minimalgovernment.net/media/nozick.pdf.

Two, these individuals and leaders are obviously driven by socialist belief and deep hatred of the profit motive and social inequity under capitalism. But they do not belong to a Socialist or Communist political party. Rather, they espouse socialism on a sectoral basis. Like health socialism, education socialism, ecological socialism, land redistribution socialism, and so on.

Three, while they may not explicitly admit that they are socialist or driven by socialist philosophy, they are explicit and unequivocal in demanding that “health is a right”, “education is a right”, “pension is a right”, “clean environment is a right”, “social insurance is a right”, “land ownership is a right”, and so on. For them, almost everything is a right, an entitlement from society via the state and its various subsidies. Even if some citizens are lazy and irresponsible, they are still entitled to certain subsidies by the state because “life is a right.”

Four, one will seldom or never hear from them the words “personal responsibility.” As almost everything is “government or state responsibility”, then there is little role for personal and parental responsibility in running their own lives. The state should allocate v percent of GDP for education, w percent of GDP for healthcare, x percent for environmental protection, y percent for food security, and so on. They may not be explicit in advocating for central planning but that is exactly what they want the state should do.

Five and a corollary to #4 above, one will seldom or never hear from them the advocacy for individual liberty and individual rights. What is paramount for them are national and collective freedom and collective rights. Individualism is taboo and the individual can only realize his/her growth potential if the collective is well-taken cared of by the political administrator of the collective, the state.

As a former Marxist-socialist myself more than two decades ago, it is somehow easy for me to identify such kind of attitude as I used to harbor such sentiments too. And having abandoned that statist philosophy several years ago, I have learned to embrace the value of individual liberty and its sacredness not to be subsumed most of the time under collective liberty.

People should assume more personal and parental (or guardian) responsibility in running their own lives, their own households and communities, if they wish to realize more individual freedom. Freedom and responsibility are two sides of the same coin.

At the end of the day, fear of responsibility is fear of freedom itself.
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Meanwhile, here's a related short paper from the FNF, sometime in October 2008:

The Vision of a Liberal Civil Society

The term “Civil Society” is used with many different meanings in the political discussion at different political levels. In our context, we are only concerned with the local level and the idea of a liberal civil society.

Inhabitants and citizens of a community generally have to accept specific restrictions in their individual freedom to guarantee peaceful living within their community. They agree to these limitations and accept the given laws, decrees and regulations in a wide range, which are set up by their local government.

Administrations have the tendency of covering the society with a dense network of regulations, as they tend to say in “the best of the citizens”. These regulations not only define what is not

allowed, but in many cases, what is allowed or what a citizen can do.

Through these networks of regulations, the administration tends to limit the citizen’s responsibility for acting and, at the same time, takes away certain aspects of his or her personal freedom. And this can happen in a way which exceeds necessary limitations by far.

But an individual can only keep his dignity through personal responsibility. Therefore the citizens in a community need to trust each other, so that all individuals are able to act and live without unnecessary regulations affecting their freedom or self-responsibility.

This is the image of a liberal civil society, to live in a community/municipality with as few regulations as necessary. However, a liberal civil society is characterized by an active citizenship where each individual feels responsible for the general public, demonstrated through free activities, voluntary co-operation and work, as well as taking responsibility.

This ideal image of a broad self-responsibility requires as many ways of influencing the structure  of the local government. The Swiss model with a high degree of plebiscitary elements is one example of such a model.

To adopt the Swiss model is almost impossible in most countries of the world. However, there

are some visible ways of increasing citizen’s participation. Such means to improve public participation can be found in the work fields of “city development” and in some cases through the setting up of the municipality’s budget, which can be called the citizen’s budget.

We can imagine that this can be extended to many more areas of citizens’ participation initiatives.

From a liberal perspective, the goal of municipal politics has to be that voluntary and private initiatives dominate the public life, and public administration only intervenes for subsidiary reasons. But we know that today this is just a vision.

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See also:

CSOs and State 7: Public School Library with Minimal Government, BftB, June 29, 2009
CSOs and State 8: Gawad Kalinga, Health NGOs and Taxes, September 19, 2009

CSOs and State 9: The Global Fund and Corruption by Some Phil. Health NGOs, March 10, 2010

CSOs and State 10: The Role of Civil Society, June 15, 2010 

CSOs and State 9: The Global Fund and Corruption by Some Phil. Health NGOs

There is "The Global Fund" (TGF, http://www.theglobalfund.org/en) to fight AIDS, TB and malaria. It's a multi-billion dollars fund from different sources, public and private, I think. To be distributed to poor countries to help them fight those 3 dreaded diseases.

Last February 26, 2010, the Office of Inspector General (OIG) released its "Audit Report on Global Fund Grants to the Philippines. Long report, 121 pages, and it showed some ugly findings. That some big health NGOs in the Philippines are engaged in some financial shenanigans in handling public funds. The report can be downloaded at
http://www.theglobalfund.org/documents/oig/Philippines%20Country%20Audit%20-%20Report_26%20February%202010.pdf

On page 12, paragraph 32, the Tropical Disease Foundation (TDF), a "non-profit" group, was shown to have engaged in over-pricing, over-billing, non-documented spending, etc., it has to repay P95 million to TGF.

Here are some details:

Net amounts repayable from reconciliation of Gen Fund, P58.33 million
Overcharged laboratory test fees, P11.83 million
Excess costs charged for the NTPS, P7.47 million
Excess funds drawn for salaries, P7.40 million
Laboratory tests rates that were applied retrospectively, P4.83 million
Billing for tests that were not conducted, P4.60 million
Amounts billed to patients for tests paid from grant funds, P0.54 million

Total P95.00 million or US$ 2.021 million

The OIG summarized its finding re TDF as "TDF lacks the capacity to manage Global Fund resources. The Global Fund cannot safely invest through TDF’s current systems and processes. TDF should also refund" the above-mentioned money.

On page 57, paragraphs 225 to 229, here are some of the questionable funds involved:

a) unpaid service incentives but retained by TDF Gen. Fund account, P642,858.
b) excess service incentives with no support documents, P575,041
c) stolen staff advances, undetermined amount.

On page 58, health NGOs World Vision and the Philippine Coalition Against TB (PhilCAT) got these funds with little or zero documentation:

World Vision, Euro 16,911
PhilCAT, US$ 300,000
PhilCAT, Euro 44,691

This is how the OIG wrote,

"The PR charged unbudgeted expenses to SR program budgets. Transfers of the above funds were made to TDF’s Gen Fund account and subsequently used as part of the costs for the National Tuberculosis Prevalence Survey. In the case of World Vision, a letter was written by TDF advising that the transfers to TDF were to be charged as monitoring & evaluation costs. For Philippine Coalition against Tuberculosis (PhilCAT) there was no documentation but funds were drawn by TDF from funds held in trust on behalf of the SR. The NTPS expenditure was not budgeted to be undertaken by the SR and should not have come out of the SR budgets."

Generally speaking, a number of supposedly "non-government organizations" behave similarly, if not worse, than government officials and politicians who are corrupt. Any opportunity where they can get hold of public funds, they also steal. Or at least do not follow the agreed terms in handling and accounting properly the funds entrusted to them.

Real "non-government organizations" (NGOs) and other civil society organizations (CSOs) should not be demanding always for "more government funding" and similar demands. As the acronym explicitly says, they are "non-government" and it is not proper for them to be too cozy with, or acting like spokesmen for, government agencies and bureaucracies.

Read the OIG's audit report and be dismayed.

In the case of TDF (http://www.tdf.org.ph), they should produce a clarification paper quick. They lose their credibility from this damning report by the OIG of TGF.
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Simple Ways for Responsible Citizenry

(Note: this is my article for "People's Brigada News")

Now that the elections are over, we go back to our regular work. And while we expect our newly-elected (and re-elected) political leaders to be good and not corrupt, we citizens should do our part. Below are some simple things that we can do.

One, obey the basic laws and rules. Do not steal, do not kill, do not rape, do not extort. Traffic laws say stop on red lights, so stop on red lights. Environmental laws say do not throw your garbage just anywhere, so put your garbage only on designated places. Let us help promulgate the rule of law in our country.

Two, report directly the law violators. Or if we are afraid to directly confront those who think they are above the law, take pictures or videos, write or blog those whom we saw or observed, to be violating the laws. Like police cars or any other government vehicles, media vehicles, etc. that do not obey simple traffic rules. Let us help promulgate the rule of law in this country.

Three, take good care of our own body and that of our family members. Healthcare is first and foremost a personal and parental responsibility, not government responsibility. Do not over-drink, over-smoke, over-eat, over-fight. Preventive healthcare is several times more effective than curative. Let us have less smoking-related, less drinking-related, less fat-related, diseases and sickness. Currently, about six to seven of the Top 10 causes of death in this country are directly or indirectly related to smoking.

Four, assume more parental or guardian responsibility in our children’s education. Education is first and foremost, personal and parental responsibility, not government responsibility. Responsible parents work hard to bring their kids to good private schools. Or if they cannot afford private education, send them to public schools but provide additional learning materials like computers, books and educational tours.

Five, teach our children and minors the value of hard work and frugality. Let us inculcate self-reliance and independence, not dependence on government welfare, subsidies and dole-outs. Let us encourage them to become non-envious of the wealth and success of others if such wealth is a result of hard work and efficiency.

Six, let us support or form voluntary and civic organizations that provide charity work to our less-fortunate countrymen and fellowmen, even from other countries. The essence of civil society is the voluntary support and active involvement of citizens on issues affecting their communities with the least and minimal involvement of the government and its various agencies and bureaucracies.

Severn, let us convince, even pressure, the government and the politicians to reduce the number of taxes and fees as we are taking more personal and parental responsibilities of certain social and economic concerns that used to be heavily provided and subsidized by the government. Let us keep more of our income and savings so that we can have more resources for ourselves, our households and communities. Government should also reduce the number of regulations, restriction and other forms of prohibitions on citizen activities, especially those related to entrepreneurship and private sector job creation.

This list is not complete nor comprehensive. Readers can add their own suggestions too. What is important is that we always bear in mind the need to respect and promulgate the rule of law, where the law is above everyone, no one is exempted from the law and no one can grant exemption from the law.

If individuals, their parents or guardians exercise more responsibility of their own health, education, nutrition, housing, credit and so on, then there is no need for huge education (elementary to college), health, food, housing and related bureaucracies. And there will be no need for multiple taxes and fees to sustain huge bureaucracies and huge subsidies. And soon we will need less politicians, less government employees and bureaucrats, as more and more people will be engaged in productive work in private enterprises in a competitive business environment. Meaning more people will become self-reliant and are involved in voluntary charity work.

Let there be more entrepreneurship and private sector job creation, less public sector politicians and bureaucrats.

This way, we need not write and expect a lot from the present and future President, legislators, cabinet secretaries and other government officials. Responsible and independent citizenry is all we need to have a small, transparent, accountable and good government.

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See also:

CSOs and State 5: Subsidiarity, Decentralization and Privatization, September 04, 2008
CSOs and State 6: Stichting Kapatiran and Books for the Barrios, December 07, 2008
CSOs and State 7: Public School Library with Minimal Government, BftB, June 29, 2009
CSOs and State 8: Gawad Kalinga, Health NGOs and Taxes, September 19, 2009

CSOs and State 2: NGOs and Government Clubs

There are plenty of world forum/meetings by statists and socialist-oriented civil society groups, as well as clubs by governments and international bureaucrats. Among these are:

1. World Social Forum (WSF) – “an annual meeting held by members of the anti-globalization movement to coordinate world campaigns, share and refine organizing strategies”, according to its main website. In the WSF India held in mid-November 2006, it describes it as a forum of “groups and movements of civil society that are opposed to neo- liberalism and to domination of the world by capital and any form of imperialism”. In short, it is the forum of anti-globalization, anti-market, anti-capitalism, anti-free trade, sort of anti-everything NGOs, media people, academics, etc. They mobilize many people in WTO Ministerial meeting, in G8 summit, in annual WB-IMF meeting, in WEF, as well as their own-initiated international meetings.

2. International People’s Forum (IPF) – it “demands for multilateral debt cancellation, transparency and participatory audits of international financial institutions (IFI) lending and policies, and an end to IFI involvement in privatization of public services and environmentally destructive projects”. It was formed in Singapore during the WB-IMF Annual Meeting held in that city-state in September 2006. Many of the IPF members or convenors are also WSF members.

3 World Economic Forum (WEF) – a private international organization that links big businessmen with political leaders around the world, with occasional participation by big NGO leaders. It’s a smaller gathering compared to WSF but more influential economically and politically.

4 WB-IMF Annual Meeting – a gathering of international bureaucrats of these 2 bodies plus finance ministers, central bank governors, other top bureaucrats of member-countries. Selected number of civil society leaders (often among WSF leaders also) are also invited by the WB-IMF guys.

5 G8 Summit – a gathering of the Presidents or Prime Ministers of 8 industrialized countries + big developing countries like China, Brazil, India, etc.

6. Organization for Economic Cooperation and Development (OECD) – a club of governments of 30 industrialized and industrializing countries around the world promoting “democratic government and the market economy”.

7. United Nations (UN) – the mother of all international bureaucracies. Somehow the name “united nations” is a misnomer; a more appropriate term should have been “United Governments”. Though a number of international “public goods” have been addressed by the UN, it has also introduced a number of international “public bads”, like the justification if not promotion of high taxation in many countries to finance more government- and UN-sponsored projects.

While many civil society groups are very critical of multilateral institutions like the WB-IMF, government clubs like the UN, G8, OECD, and private international for a like WEF, those civil society groups actually have more similarities than differences with them. That is, they are mostly statists and forced collectivists. They want the state to have bigger intervention in the citizens’ lives. They want individual’s incomes to be forcibly collectivized, and individual responsibilities be transformed to state and collective responsibilities.

The only difference between those who criticize and those being criticized, is the degree of intervention to be slapped on the citizens; ie, the level of taxation that will be confiscated from the citizens’ pockets, the level of budgetary reallocation, and level of subsidies that will be given to the poor. While the WB-IMF and government clubs can tolerate a certain level of de-governmentization through privatization and economic deregulations, the statist NGOs want socialism-type of income confiscation and welfare distribution.

Free marketers can criticize both groups because they advocate very small income confiscation, small government intervention, and bigger individual freedom and responsibility. Individuals, not just big corporations, comprise markets. Thus, to liberalize markets is to liberalize individuals.
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Last March 23, 2006, I wrote this:

The Elites and the Statists

A friend, Atty. Ime Deinla, called my attention to a paper entitled "Voices from the Top of the Pile: Elite Perceptions of Poverty and the Poor in the Philippines", authored by Gerard Clarke and Marites Sison. It was in a pdf formal file, 28 pages long, no date of publication or name of paper where it was published. I skimmed through the pages and read the concluding points, and this part is a disappointment to me. The authors wrote,

The Filipino elite feel a sense of responsibility to the poor, but this responsibility is met through the provision of assistance on a patron-client or philantrophic activity, rather than more substantive commitment to redistributive action led by the state, involving for instance, elaborate social safety nets financed by higher taxes.

Ouch! We don't have enough taxes, we need to create more? And our taxes ain't high enough, we need to hike them more? Socialists, statists and interventionists really like this line. Confiscate more income and savings from the rich, from the elite, from the productive sectors of society, and give them to the poor, the downtrodden, the weak. And an elaborate maze of bureaucracies, multiple-layers of politicians, with rah-rah boys from many NGOs and civil societies as middlemen between the two.

I have said it and I will say it again: poverty is very often self-inflicted.
Recipe #1 to be poor: Just be a lazy bum, don't work hard (if at all), drink and party too often; you'd rather drink and discuss with other guys how hard life is, how govt. and the church and the rich and your relatives abandon you, while a piece of land near your house which could have been planted to vegetables or raising farm animals are full of tall cogons, other grasses and vines.

Recipe #2: Be lazy and have plenty of kids, be irresponsible; anyway, government will confiscate rich people's income and savings to educate and feed your kids.

Recipe #3: Work hard and earn big (like working abroad), but also spend hard and save nothing; when the rainy days come, nothing to dig from the pockets.

There are other natural causes (like your house and car and land were gobbled by a volcanic eruption or a big landslide, or cracked to pieces by a strong earthquake) and other people-caused miseries (like your house burned, your car stolen, your land grabbed, your family members beaten and imprisoned for unjustified reasons) to explain poverty. And my favorite, government and its underdevelopmental roles of high and multiple taxes; costly and multiple requirements, permits, licenses, registrations, inspections, accreditations, before one can even start a carinderia or vulcanizing shop, if you do not want to be labelled as "underground" economy and "tax evader".

I would also add that philantrophy should not be dismissed as if it's an insignificant and near useless act, not to be pooh-poohed as encouraging patron-client mentality. Philantrophy and charity signify 2 important things:

(1) It is a voluntary act by an individual or group of individuals in a voluntary organization (club, association, brotherhood, etc.), not mandated by the constitution or by legislation or by an executive order; and
(2) Its funding is from the individuals' savings, from hard work, not from taxes and forced contribution.

Of course, some guys and organizations or foundations use charity for tax-shield purposes. But that's primarily because taxes are high and a plenty, and it's not the taxpayers who determine where the tax money goes, but the politicians and top government bureaucrats.

Ooppss, these kind of remarks would probably alert the authors, Clarke and Sison, to call Oplas "one of the elites". Wrrooonnggg!! Este, riiiigghhhtttt pala!
I'm E-lectrifyingly L-ovable, I-nsiduous, and T-antalizingly E-lectrifying! That's ELITE! hehehe, joke.

The paper is commendable though for gathering a big number of insightful interviewees, from politicians to businessmen to academics and NGO leaders.

CSOs and State 1: AIDS and Perversion of Welfare

There was a very disturbing news from the Wall Street Journal last April about AIDS. It was entitled,

"Dangerous DecisionIn South Africa, Poor AIDS Patients Adopt Risky Ploy"
To Get Disability Payments, Some Skip Medications, Putting Lives in Peril
Aiming to Be 'Very, Very Sick'
By MICHAEL M. PHILLIPS April 7, 2006; Page A1

The South African government gives advanced anti-AIDS drugs for free to patients. The pills, antiretroviral "cocktails", would boost one's immune system, relieve symptoms and restore his/her health. In addition, the government gives out a $130-a-month disability grant, if one is really sick.

The results were rather sickening. Some poor people who have bad AIDS situation and receive the allowance from the government stopped taking the anti-AIDS medication so they will remain sick and can continue drawing the allowance. While those who have better or improved conditions have stopped taking the medicines, find ways to be infected further, to get sick further, so they will qualify for the government allowance!

According to Mr. Phillips' report, patients who do this would rather endure terrible sickness just to get the allowance so they will have extra cash to feed their kids, or pay rentals and debts, or start a small business. There are estimated 5.3 to 6.3 million HIV carriers in South Africa.

In economics, you call that behavior of choosing to be sicker to get allowance as "moral hazards" problem. If people know that there are some form of rewards or protection (bail out, subsidies, allowances, stipends, other forms of protection) if they misbehave, then they will misbehave. Well, at least for those who are desperate enough and consider the rewards for irresponsibility better than the pain (physical, emotional, whatever) of such irresponsibility.

In the Philippines and other poorer countries, there are similar behavior.
Here for instance, we have a law that squatters cannot simply be removed from the lands they're squatting on, unless the owner/s of the land (government or private) will find a relocation site for those who will be evicted, facilitate their transfer. In some government relocation sites, government even gives the relocated squatters land titles.

Result? Squatters mushrooming in many places. They just occupy private lands, or government lands. Many private land-owners are more determined to evict the squatters and guard their lots. Government, the biggest landowner in the country, even confiscating some private lands if landowners did not pay the real property taxes plus the high penalties for delayed payment, is more tolerant of squatters. Government leaders for one (from mayors, congressmen, governors to the President) often protect the squatters from eviction so long as the latter will vote for them, and support them if they are experiencing political crisis.

There are also the so-called "professional squatters". When government gives them land titles, they sell that title to other people, get the money, then hop to another lot or location and squat the area, waiting for another round of new land titles to be given to them.

So, people really respond to incentives.
If there are incentives for irresponsibility and misbehavior, or the penalties are too light for misbehavior like stealing, then some people will abuse any government welfare and remain irresponsible.
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A friend sent me also an awful news from The Washington Times (date not indicated), entitled
"AIDS INCENTIVES COSTLY TO AGENCIES"
by Karen Palmer.

The disturbing news is that in Malawi and other parts of Africa, people who are potential victims of AIDS, if not already suffering from it, now require "allowance" fees and per diems (effectively, bribes) before they will attend AIDS meetings and seminars that will directly benefit them. The going rate, according to the report, was 1,500 kwachas, or about $10 equivalent per day. And the international NGOs, or UN agencies have started the practice of distributing money to people and local government bureaucrats to entice them to come to their seminars. The report said, "Some blame UNICEF, others blame Oxfam, but no one remembers who first offered envelopes of cash in exchange for attendance. The point, they say, is that now everyone does it. And people say, 'If you don't give us pocket money, sorry, we're not interested.'"

In addition, government officials and civil servants also require payments, "sitting fee" they call it, for them to attend meetings and seminars. Continued the report, "The result is that some HIV workers use training sessions as a lucrative source of income, floating from one workshop to another, shopping around for conferences where participants stand the greatest chance of making a bit of cash."

So if the international NGOs will not give money, no one will come to their AIDS seminars, so what? The NGOs are afraid that they will have no picture and real reports to show to their donors? Then why bother to help people who don't bother to help themselves either, why put in your money (or other people's money)? And the national or local government bureaucrats, why bother to invite them if all they need is "attendance fee"?

It's bad that tax-funded government foreign aid has corrupted the concept of "national development" of many poor country governments. It's equally bad that private-funded NGO foreign aid has corrupted the concept of "personal welfare" of many poor country citizens.

Maybe we should consider the fact that if nature is killing people (AIDS, malaria, TB, and so on) and people don't want to help themselves, then let nature take its course.