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Pres. Aquino’s Social Contract: A Convoluted Blueprint for National Failure

June 2, 2012

“I cannot help fearing that men may reach a point where they look on every new theory as a danger, every innovation as a toilsome trouble, every social advance as a first step toward revolution, and that they may absolutely refuse to move at all.” — Alexis de Tocqueville

Pres. Noynoy Aquino’s leadership program is undoubtedly based on his political policy of social contract. This government policy was articulated in the President’s Executive Order No. 43 issued on May 13, 2011.

The E.O. titled ‘Pursuing Our Social Contract With the Filipino People Through the Reorganization of the Cabinet Clusters’ mandates his far-reaching 16-point agenda that lays down his vision of government, his Philippine Development Plan (PDP) 2011-2016 that serves as the “government’s blueprint that defines the strategies and programs that will translate the Social Contract into efficient, effective, and responsive actions that are achievable” until 2016, the role of his cabinet that “serves as a catalyst for national development”, and the function of his regime  “to orient and direct its programs, projects, and activities towards the attainment of development outcomes that will lead the nation closer to its priority development goals”, among others.

So, it can be assumed that everything the government does and aspires to pursue was decreed or mandated in this authoritative executive order, as it sets or defines this nation’s present and future political course. Following his historic election to public office, the President started implementing his initial political agenda by assembling his economic team and political advisers who represent or embody his political views and social aspirations.

The Aquino regime’s collectivist social contract

Aquino’s social contract with his constituents, which consists of 16 broad political policies, include human development; infrastructure development; economic development; sovereignty, security and rule of law; and good governance.

The executive order also defines the government’s vision in the following manner:

  • A re-awakened sense of right and wrong, through the living examples of our highest leaders;
  • An organised and widely-shared rapid expansion of our economy through a government dedicated to honing and mobilizing our people’s skills and energies as well as the responsible harnessing of our natural resources;
  • A collective belief that doing the right thing does not only make sense morally, but translates into economic value as well; and
  • Public institutions rebuilt on the strong solidarity of our society and its communities.

The problem with that political vision is that it is so broad and vague that it can admit numerous interpretations. My humble understanding is that a vision, like any corporate vision, should be clear, concise, unambiguous, objective, realistic, practical and easy to understand. It means that a political vision must contain the government’s specific and clear agenda for a specific period of time, not some mumbled feel-good political slogans and vague social platitudes.

How does the government define “organised and widely-shared rapid expansion of our economy “? Does widely shared mean income distribution or any form of redistributive policies? Does “organized” economy mean central planning? Can any government rapidly expand its economy through a combination of these policies? Also, what is this “government dedicated to honing and mobilizing our people’s skills and energies”? How would the government translate that to concrete political policies? By creating or forming new government programs or agencies tasked with ‘mobilizing’ or improving people’s skills and energies?

How would the government also infuse or promote what it calls ‘collective belief ‘? One must understand that to infuse or spread a collective belief, one needs to challenge or to change, through radical means, a society’s long-established culture.

Furthermore, what does it mean by public institutions founded on society’s “strong solidarity”? Who determines the nature of this social solidarity or whether it has already been achieved? The government and its agents, of course.

The key ‘result areas’ of the government’s social contract are as follows:

  1. Transparent, accountable, and participatory governance – to institutionalize open, transparent, accountable, and inclusive governance;
  2. Poverty reduction and empowerment of the poor and vulnerable – to translate the gains from good governance into direct, immediate and substantial benefits for the poor;
  3. Rapid, inclusive, and sustained economic growth – to achieve rapid economic expansion that generates jobs and livelihood for and increase the income of the poor while moving away from the boom-and-bust cycle of the economic performance of the past;
  4. Just and lasting peace and the rule of law – to attain a just, comprehensive, and lasting peace within the bounds of our law; and
  5. Integrity of the environment and climate change adaptation and mitigation – to promote sustainable natural resource utilization and climate change adaptation and mitigation strategies and measures among national government agencies, the local government units (LGUs) and their respective communities, the general public, and other stakeholders.

This aspect merely shows that the government somehow focuses only on results, as it describes its fiscal and spending policies as “results-focused”.

I have no problem with transparent, accountable, and participatory governance, however, the president’s highly expensive and controversial campaign for the removal of the chief justice is more than about achieving so-called ‘good government’. It appears that the impeachment process that ousted former chief justice Renato Corona was more about political cannibalism, or the empowerment of the executive branch at the expense of its two co-equal branches- legislative and judiciary.

Throwing money at poverty-inequality problems

The Aquino administration’s poverty reduction program is about translating the benefits “from good governance into direct, immediate and substantial benefits for the poor”. It seems that this strategy is purely about redistribution of wealth, or in the words of United States Pres. Barack Hussein Obama, it’s about “spreading the wealth around”. Can the government serve the poor through redistributive policy without hurting those who make economic progress– the private sector– possible? I don’t think so.

To improve the quality of life of the Filipino people, the Human Development and Poverty Reduction Cluster was empowered to pursue the following goals:

  • Making education the central strategy for investing in our people, reducing poverty and building national competitiveness;
  • Recognizing the importance of advancing and protecting public health;
  • Building of the capacities and creation of opportunities among the poor and the marginalized;
  • Increasing social protection and engaging communities in their own development;
  • Promotion of equal gender opportunities in all spheres of public policies and programs; and
  • Ensuring effective coordination of national government programs for poverty reduction at the local level.

This simply means that the government’s only strategy to allegedly combat poverty is to throw more money at the poverty problem. But where will the government get the money to achieve its goal?

One thing that is so good about politics is that no one has ever attempted to cheat economic reality without getting the exact opposite of his/her goal or aspiration. The socialist government of Greece did just that. The welfare state of Greece attempted to reduce poverty and social inequality through redistribution of wealth and regulative policies. The end-result of this political madness and quackery? More debt, high inflation, less investment (both foreign and domestic), higher spending, and more freeloaders.

When it comes to economic aspect, the government planners simply resorted to simplistic political platitudes. It merely defines the term “rapid, inclusive, and sustained economic growth” without stating the strategies or steps it needs to achieve or implement in order to reach that goal. How will the government achieve economic growth? By simply promulgating new economic laws? Through regulations? Through a higher degree of economic protectionism? This particular job was given to the Economic Development Cluster that must pursue the following goals:

  • Promoting an environment conducive to the growth and competitiveness of private enterprises and the creation of jobs that will empower people and provide them with opportunities to rise above poverty;
  • Ensuring the reliability of vital infrastructure and technologies that facilitate the movement of peoples, goods, services, and information; and energy that will fuel the economy;
  • Improving farms and rural enterprises vital to achieving food security and more equitable economic growth;
  • Undertaking research and development that are relevant to and supportive of the requirements of micro-, small- and medium-scale enterprises and of national industries;
  • Improving of national productivity and the competitiveness of domestic products and services; and
  • Ensuring deep and wide distribution of economic opportunities and benefits to the Filipino people.

The fallacy of Aquino’s market competition

Whenever the government starts talking about promoting market competition, always be suspicious. One way for the government to achieve this is to introduce new antitrust laws, which would only hamper competition and punish successful businesses. Also, our economic planners seem too clueless about the state of market competition in the Philippines. There is no real competition in this country because of our protectionist and regulative economic policies that benefit oligarchs and cronies. If the government wants more competition or to level the playing field, it only needs to open our economy to foreign investors. But this cannot be done without revising first our charter. However, I don’t think this is part of the president’s highly convoluted plan.

Our government planners need to understand the basic concept of wealth-creation. Who creates wealth– is it the government or the private sector? If it’s the private sector, what are the specific strategies the government needs to implement or to adopt in order to encourage the private sector to create wealth? These are the very basic concepts that are unfortunately not being taught in most, if not all, universities and colleges in this country today.

When it comes to environment, the government is simply parroting the leftists’ and globalists’ failed political rhetoric about environmentalism and climate change. Man-made global warming is a myth. It is very much alarming that our economic and political planners, including our public intellectuals, are clueless believers of anthropogenic global warming. There’s a big difference between the terms ‘climate change’ and ‘global warming.’ Climate change is real, and planet earth has been exposed to this natural phenomenon for millions of years. Climate change is natural-caused, not human-caused.

On the other hand, global warming, according to its proponents like Al Gore, is human-caused; it’s a recent global phenomenon. If it’s climate change that the government is talking about, then, what it calls ‘climate change adaptation or mitigation’ is utterly futile. The government can do nothing to fix or mitigate the affects of climate change. Take note that since the scientific exposé of the many loopholes in the arguments of the global warming alarmists and fanatics, the latter began adopting the term ‘climate change’ in order to confuse the people and to somehow legitimize their failed arguments.

Aquino’s social contract means comprehensive welfare state

Pres. Aquino’s social contract is all about comprehensive welfare state that promotes and implements redistributive policies, more welfare programs, higher government spending, more regulations and protectionism, and more economic controls all in the name of social progress and economic development.

Welfare state is the collectivist idea that the government must play a key role in serving the basic needs of its citizens through delivery of welfare programs like government-funded education, healthcare, housing, food stamp, etc. This concept of government is evil, immoral and impractical because it justifies the government’s use of force. Welfare state is based on that draconian Machiavellian philosophy “the end justifies the means.” It means that the government is justified or authorized to sacrifice one social sector for the benefit of another social sector. It means that it is authorized or empowered to redistribute wealth, to centrally plan the economy, to regulate certain economic or individual activities, and to limit or restrict people’s rights and freedoms in the name of social justice and the greater good. Thus, welfare state is all about centralized political power or dictatorship.

The term social contract is a socialist, statist, collectivist concept, which has no objective meaning. The political philosophy behind this concept is egalitarianism, which was favored or advocated by its most influential proponent Jean-Jacques Rousseau. Egalitarianism means the belief in the equality of all men, yet this ‘equality’ does not merely mean ‘equality before the law’ but economic equality of results that is disastrous to individual rights and freedom. This means that the government is empowered to sacrifice a successful, productive social sector to serve the welfare of a disadvantaged social sector. The logical end-result of this political philosophy is government intervention into individuals’ economic, social and personal affairs. The only logical end-result of this political madness is Big Government.

The President’s social contract, which is obviously based on Rousseau’s political theory, is against human nature and individual rights. That is exactly the reason why another French intellectual, Voltaire, strongly rejected Rousseau’s highly dangerous idea.

Voltaire sent Rousseau the following message after reading his book:

“I have received your new book against the human race, and thank you for it. Never was such a cleverness used in the design of making us all stupid. One longs, in reading your book, to walk on all fours. But as I have lost that habit for more than sixty years, I feel unhappily the impossibility of resuming it. Nor can I embark in search of the savages of Canada, because the maladies to which I am condemned render a European surgeon necessary to me; because war is going on in those regions; and because the example of our actions has made the savages nearly as bad as ourselves.”

Voltaire, an intellectual genius, was way ahead of his time. The problem is that not too many modern-day intellectuals ever attempted to study Voltaire’s rejection of Rousseau’s ‘book against the human race.’ They simply took Rousseau’s mystical assertions on faith.

The Yellow social contract is a myth

There is no such thing as a social contract. Whether this kind of contract be implied or not, inherent or not, rhetorical or not, mystical or social, human beings cannot be simply governed by a non-existing, non-binding ‘collectivist agreement’ called ‘social contract’. The Constitution does not embody or mandate such a statist contract between the state and the people. The Constitution is simply a limitation on the powers of the state since the state holds a monopoly on the use of force. Also, the Constitution does not create nor grant rights that individuals already possess; it merely recognizes or respects those rights.

In essence, the Constitution serves as a legal manifesto, which stipulates that the people agree to grant or to transfer specific, delimited, well-defined powers to the state’s representative, which is the government, for the protection of their lives, rights and freedom. Thus, the only proper role of government is to protect people’s rights against private aggressors and the government itself. The very source of state or governmental powers is the people themselves. It is the people who are free to contract with each other or with any juridical entity.

The only ‘social responsibility’ of every individual is to respect the rights of others. If one respects or refrains from violating the rights of others, then, that’s equivalent to one’s respect for the rule of law.

I’m aware that a lot of people, most of whom are intellectuals and modern-day political theorists, claimed that this social contract is [either] expressed or implied in the constitution, which is the mother law of the land. Contemporary social contract theorists defined this concept, which is in reality an anti-concept, in the following manner: that according to social contract theory, “morality consists in the set of rules governing behavior, that rational people would accept, on the condition that others accept them as well.”

Such an interpretation was based on the notion that the state of nature is inherently “anarchic”, and that in state of nature there are no social goods, so a single political entity had to be established to force social cooperation to produce these social services (according to Thomas Hobbes). John Locke largely differed from Hobbes’ interpretations, asserting only the fundamental idea that persons in a state of nature would agree to come together to form a state. Locke believed that individuals are moral and rational beings that they would be willing to organize a state that would provide a “neutral judge”, the function of which is to protect individuals’ lives, liberty, and property.

Rousseau’s political theory, which largely influenced contemporary thinkers, reeks of collectivism, a single political ingredient that appeals to today’s socialist thinkers, political movements and regimes. Rousseau contends that an individual cannot pursue his true interest by being an egoist but must instead subordinate his individuality and will to the law created by the citizenry acting as a collective. This shows that Rousseau was greatly influenced Immanuel Kant’s work on ethics. It was Kant who once argued that an action is moral only if a person is not motivated by any form of desire to carry it, but carries it out of a ‘sense of duty’ and thus acquires no benefit from it of any sort.

Thus, according to Rousseau, “[The social contract] can be reduced to the following terms: Each of us puts his person and all his power in common under the supreme direction of the general will; and in a body we receive each member as an indivisible part of the whole.” Such an assertion brings to mind Adolf Hitler’s ‘triumph of the will’, and exposes the unapologetic collectivism in Rousseau’s political theory. Rousseau, who was a Kantian, was one of the medieval advocates of ‘sense of duty’ in politics. It’s never a coincidence that Adolf Eichmann, who was widely regarded as the architect of Nazis’ holocaust, was also a Kantian. During his trial, Eichmann said he was simply “doing his job”. That he “did his duty”…; he not only obeyed orders, he also obeyed the law.

The President’s social contract policy undoubtedly reeks of collectivism and the politics of sacrifice. Under the Aquino administration’s social contract, the government is empowered to deliver of achieve the greater good through socialistic programs and economic policies. History tells us that this primitive notion of ‘the greater good’ has served as the moral and political basis of most socialistic social systems or dictatorships. The most vicious political slogan of this utilitarian ideal is “the greatest good for the greatest number”, which has no concrete, objective meaning.

There is no objective definition of Pres. Aquino’s “greater good” except– whatever is good for the greatest number. Who, in any particular issue or event, has the power or authority to determine what is good for the greatest number? Perhaps it’s Mr. Aquino and his economic team composed mainly of Marxist academics and statist intellectuals.

The President, being an authoritative agent of the state, is wrong to assert or even to assume that he holds certain powers to create a contract with the government’s constituents. The main problem is, this nation was never founded on the right basic principles. It was founded on the idea that the government is a redistributive agent of social justice and public welfare.

More welfare spending, less economic progress

To translate its alleged social contract into concrete social programs, the Aquino administration came up with its Reform Budget that carries the theme “Tungo sa Paggugol na Matuwid”  (Towards Correct Spending). This theme conveys the government’s aspiration “to put public spending back on the right track towards prudence and effectiveness.”

According to the government’s primer, “Paggugol na Matuwid” means “each and every peso spent by government counts in empowering the people and in building a prosperous nation.” But what do ’empowering the people’ and ‘building a prosperous nation’ mean?

The government primer states:

In this quest for “Paggugol na Matuwid,” the government will escalate the reforms it already began, towards ensuring that public spending leads to direct, immediate and substantial benefits for various marginalized sections of society: students deprived of free and quality basic education, patients urgently needing proper health care facilities in the countryside, farmers without access to effective irrigation and post-harvest facilities, and millions of other Filipinos who have been sinking in joblessness, poverty and hopelessness for so long.

Thus, the 2012 National Budget has been designed to be a Results-Focused Budget. This budget—the first that has been fully prepared and legislated, and will be fully implemented, under the Aquino Administration—has been crafted to veer public spending away from waste and irrelevance, and to focus it on key priorities in line with President Aquino’s Social Contract with the Filipino People. In other words, “Paggugol na Matuwid: Diretso sa Tao.”

The Aquino Administration intends to further define “Paggugol na Matuwid” throughout its term. But it can only succeed with the active and informed participation of the very citizens that the annual National Budgets seek to serve. With this, we in the Department of Budget and Management invite citizens to join us in this quest for “Paggugol na Matuwid.”

As already stated, Aquino’s self-imposed social contract is all about more government spending, welfare state, and redistribution of wealth. This must be the case because common sense and logic imply that every government program requires money, and that every government spending requires a definite source of wealth (e.g., taxpayers, credit, debt monetization, or foreign aid). Can the government overspend its people’s money in order to solve some alleged social and economic problems like poverty, unemployment, social inequality, among others? What is crystal clear is our government officials are fully aware that we have en ever-increasing budget deficit. We also have a huge public debt. They are all aware that the government revenue is not enough to carry all government programs. Apart from development and welfare spending, the other two elements of the government budget are debt servicing and government operations (e.g., salaries, pensions and other statutory expenditure that must be paid on time). Of these three elements, only welfare spending can be cut or adjusted; the other two cannot be reduced.

However, with unstable approval or popularity ratings, President Aquino is unwilling to reduce his welfare spending, since he is determined to expand the government’s previous welfare programs. He believes that more welfare spending is the key to solving or mitigating poverty problems and social inequality.

As expected, the governments budget for 2012 is characterized by higher welfare spending, which include social services and economic services (see the figure below).

From the government primer:

The social services sector—education, health, social welfare and employment, etc.—will continue to get the biggest share (P567.9 billion) of the national budget.

The economic services sector follows next with PP439.5 billion to fund major services in agriculture and agrarian reform, communications, roads and other transport.

The rest of the budget pie will go to Debt Burden with P356.1 billion, General Public Services with PP338.1 billion and Defense with P114.4 billion.

Unsustainable government spending

Despite being titled as “Bulk goes to salaries”, the figure above does not merely pertain to government salaries; it also pertains to subsidies and other expenses. Personal services, which usually gets a higher share in the budget pie, comprises 32.7% of the entire government budget. Personal services, according to Riley and Colby (1991; Practical Government Budgeting: A Workbook for Public Managers), pertains to employee-related costs that include salaries, wages, and fringe benefits. This means that the bigger the size of government, the higher the spending. And if this administration keeps on creating new agencies, offices, bodies, bureaus, ‘clusters’, and new personnel, that means it needs a higher amount of budget.

MOOE, which stands for Maintenance and Other Operating Expenses, got P19.4 billion, while MOOE program operations was allocated P249.7 billion. Government-owned and controlled corporations was also allocated budget in the form of subsidy amounting to P19.7 billion. Aren’t these GOCCs making revenues or income? If they’re not making any money at all, since most of the income usually goes to corruption and officers’ perks and bonuses, then, I believe it is best to privatize all GOCCs. Let them manage by the private sector.

Also, what is this ‘tax expenditure fund’ that received P33 billion? I believe the Philippines simply borrowed this scheme from the Americans who included “tax expenditures” in their tax code. But the question is, are tax expenditures really a form of government spending? This is one of our government’s spending ‘schemes’ that escapes the prying eyes of the media and political pundits. It appears that tax expenditures are not really spending.

This source provides the following explanations:

Tax Expenditures:

13.1.    In the Bureau of Internal Revenue (BIR) which is the highest revenue earner of the Government, tax deductions and exemptions which are claimed by taxpayers in the income tax returns are at present not being audited by the COA because of the Temporary Restraining Order issued by the Supreme Court as a result of a case being filed by the BIR against COA.

13.2.    Likewise, Tax Credit Certificates (TCC) are not being audited since these are not recorded in the books of accounts. However, COA is now in the process of issuing accounting guidelines/procedures on the issuance, utilisation/redemption and reporting of TCCs and Tax Incentive Certificates.

13.3.    Unlike the BIR, the Bureau of Customs has allowed the COA auditors access to all revenue records, hence tax exemptions and tax credits are being audited.

13.4.    Presently, there is no existing system of costing tax expenditures. Moreover, there is no record available to determine the total tax expenditures for a given period in order to evaluate the effectiveness of taxation provisions.

Fortunately, this issue was once questioned by tax experts in the United States. A tax expert testified before the U.S. Senate Budget Committee and made the following revelation regarding tax expenditures:

According to the Joint Committee on Taxation, “tax expenditures include any reductions in income tax liabilities that result from special tax provisions or regulations that provide tax benefits to particular taxpayers.”[i]  These special preferences are called tax expenditures because some people consider them the equivalent of direct spending through the tax code.

However, aside from the refundable cash outlay portion of some credits, tax expenditures are really not the same as direct spending. Instead, they are an attempt to achieve certain public policy goals by inducing or incenting taxpayers with the prospect of a lower tax bill. Essentially, lawmakers are trying to get taxpayers to achieve these policy objectives by using their own money, not “the government’s.”

To be sure, many people improperly view the forgone revenue from tax expenditures as “the government’s money.” By this view, what the tax code allows taxpayers to keep through tax preferences has thus been “spent” in the same manner as a government program.

Aquino’s results-focused madness

Since the government also financed its welfare and government programs through credit, it is obligated to pay on time if we are not going to default. This year, the government allocated a total of P351.1 for debt servicing. That’s 19.6% of the total budget.

In terms of allocation per region, see the figure below:

The Aquino administration’s social contract, according to its primer, has the following key principles:

  • Focuses Spending on the Social Contract
  • Enhances Daylight in Governing the Nation’s Coffers
  • Shuns the “Business-As-Usual” Mindset in Combating Poverty
  • Consolidates our Strengths for Economic Growth
  • Ensures an Enhanced Context for Development

The government aspires to focus all government spending on the ‘Social Contract’ using a “results-focused budget”. The objective is to fulfill “the administration’s Social Contract with the Filipino people”. This means that all funding of programs and activities of the government will be “aligned with the 5 Key Result Areas (KRAs) of the Aquino Social Contract with the Filipino People, as stated under Executive Order No. 43.”

This vision is illustrated in the following figure:

I find that figure highly problematic, conceptually and philosophically. Good governance is a very broad and highly subjective term. To most people in these parts, the term “good governance” is usually used as a good-sounding, propaganda-filled political slogan. What most people don’t know is that this concept, which is normally turned into an anti-concept, is ideologically motivated. For instance, good governance for the socialists means more welfare spending, central planning, collective programs, and centralized government. This type of ‘good governance’ is actually what the President’s father, Ninoy, advocated. However, for the individualists and pro-capitalists, good governance means limited government, no welfare spending, economic freedom, and protection of individual rights. This is what the founding fathers of the United States originally envisioned. Unfortunately, this same vision that established the economic and political foundations of America and made it economically prosperous, was gradually eroded during the progressive era from 1890s up to 1930s.

The folly of the Aquino regime’s ‘good governance’

An essential component of Aquino’s social contract is good governance. The government primer further states:

For President Aquino, the Filipino people’s mandate to him is clear: to transform government so it upholds the highest standards of integrity and addresses the people’s most pressing needs. This is why he continues to be true to his campaign promise of kung walang corrupt, walang mahirap.

He believes that for the country to move forward, the government needs to regain the people’s trust by finally putting closure to decades of corruption and abuse of power. Public institutions also have to be strengthened in order to effectively uplift the lives of the people, to reinvigorate the economy, and to establish an environment of rule of law and ecological sustainability. Moreover, he believes that the fruits of good governance must be directly, immediately and substantially felt by the people.

The 2012 National Budget invests in immediate and long-term reforms that seek to transform government into one that truly serves its people.

I state in a previous blog that one needs to objectively identify the country’s real and actual political and social problems in order to understand what makes economic prosperity and freedom possible. I stated the following:

A lot of Filipino intellectuals and academics also claimed that graft and corruption is one of the main sources of the country’s social and economic problems. To support their claim, they pointed out the many corrupt practices, cases of bribery, plunder, and malversation of public funds, and abuse of political powers that past and present politicians committed and perpetrated against the rule of law and the Filipino people. They indeed have a point except the fact that they don’t fully understand the main cause of these graft and corrupt practices in the government sector.

What is the source of corruption and failure of governance? This is actually one of the most fundamental questions that our intellectuals, academics, scholars, and political pundits take for granted. They simply believe that corruption can be and should be solved by the government alone.

The real cause of corruption: Our 1987 Charter

What our government planners and intellectuals fail or refuse to understand is that the root cause- the cause of the cause– of corruption and our national predicament is Big Government, which was established by our protectionist, welfare Constitution.

I also stated the following:

The solution to failure of government and graft and corruption is not the Big Government, but Limited Government and Free Market Capitalism. Graft and corrupt practices exist because of the many pervasive, intrusive and non-objective government functions that limit and/or violate our freedoms and rights. Observe that cases of corruption and bribery are rampant in government agencies that engage in moneyed transactions (e.g., BOC, BIR, DepEd, DPWH, etc.). This is because the government has become so big and so enormous that it gradually amassed so much powers to the detriment of its citizens’ individual rights. Corruption and irregularities in some government-owned and -controlled corporations like MWSS, PAGCOR, PCSO, among others have become part of their culture because the government simply holds a monopoly on public utility, gambling and other sectors.

Thus, the Aquino government cannot possibly reduce or eradicate graft and corruption in the public sector while pursuing and expanding the government’s welfare programs. Like germs or viruses, corruption persists in government areas that extend government money in the form of welfare services. It is an observable, undeniable fact that every government agency involved in the provision or delivery of welfare services like DSWD, DepEd, DOH, etc. is tainted with cases or allegations of corruption. Also, all income-generating government agencies (like BIR,BoC, PAGCOR, and others) which the government maintains and supports to cover its expenses, are riddled with corruption and all forms of dishonesty and irregularities.

Economic freedom: Key to economic progress

The only way for our government to fight poverty is to guarantee economic freedom and to embark on free market reforms. This is what Myanmar is trying to pursue with its new government, as its draft constitution seeks to allow foreigners to own 100% equity in land and business. More local and foreign investors means more jobs and business opportunities for Filipinos. More employment and business opportunities means more Filipinos do NOT have to depend on government welfare and services. This means that the poor do not have to depend on the government for free condoms, food stamps, government housing, government-funded education, government-funded health care, etc. Welfare programs are both making Filipinos highly dependent on the government and bankrupting this country. This is what many political analysts, academics, and so-called intellectuals fail to understand. Also, independent citizenry means the government need not spend too much taxpayers’ money. Finally, the only way to fight graft and corruption in the government sector is to downside the government itself. It is the government that ought to be regulated.

This country needs real free market reforms. This is what we badly need today. However, I believe this goal is hard to achieve because we have been trapped in an economic prison. In reality, the real enemy of the Filipino people is not graft and corruption or poverty, for these are merely the effects of our semi-socialist political system. This country’s real enemy is the 1987 Constitution that justifies economic protectionism and regulation, gradually establishes this country as a comprehensive welfare state, encourages institutional corruption, and limits, bit by bit, people’s rights, freedoms, and future.

3 Comments leave one →
  1. December 10, 2012 3:38

    For added knowledge:

    The concept of social contract is problematic. Why? Let’s go to the necessary elements to bring forth a legally binding contract. (outline from )

    1)Offer and Acceptance
    a) Has the government offered you a service with terms?(Specific, concise, and not broad)?
    b) Have you actually accepted that offer and terms?
    c) Can you present counter offers?
    d) Can you refuse the offer?

    ” Acceptance must be unequivocal and communicated to the offeror: the law will not deem a person to have accepted an offer merely because they have not expressly rejected it.”

    Oh, by the way, if you haven’t noticed, the government/state changes the terms of your social contract ever so often with ordinances, referendums, memorandums, Bills that turn into laws; so, how fair is that?

    2)Intention to create legal relations
    The only problem here is that the third party adjudicator here is also the government, so, I would find it hard to believe that the court of law can give a neutral judgement if the case is YOU vs. GOV’T or GOV’t vs. YOU; especially if its BIR, or the State invoking eminent domain or whatever cast the state has an interest on.

    Also, if ever the state, as a party in the ‘social contract’, violates the contract, what is the citizen’s recourse? The office of the Ombudsman (also government).

    Our taxes for their… service?

    Consider that every citizen has some sort of discontent towards the government’s, piss poor performance on their promises. Even communist/socialist complain that government does not do enough ‘equalizing’ of classes; businesses complain of too much regulation, or not enough regulation on their competitors etc…

    So how would you now consider the efficiency of your taxes?

    4)Legal capacity
    So when did I actually enter into this ‘social contract’?

    Philippine law does not recognize the signatory of minors being legally binding.

    Yet, I can’t remember me signing this contract…

    Where is it anyways?

    A contract in which you and the government are the parties involved; where the terms change every now and then because of new regulations, a third party which is also the government, where you pay an increasing rate of taxes every year for piss poor performance, and where you actually accepting all of this without your signature as a legal entity because of implied consent?

    Also, it seems that you cannot even refuse this contract (duress?)

    Problematic on every level.


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