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Saturday, April 13, 2024

The vanishing middle class

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“The middle class have to fend for themselves against more and more difficult odds, their tribe vanishing ever more”

The Monetary Board decided to keep the interest rates steady, afraid that inflation woes, despite relative improvement in the last quarter of 2023, would rear its ugly head once more.

Why is this?

The first problem is the food staple — rice. Despite a typhoon-less wet season harvest, the production increase has been quite marginal. Proof of this is both in the farm-gate prices and the markets.

Even when the PSA reported lowered inflation, it admitted rice prices were spoilers.

Truth is, despite normal theories about staple food being demand-inelastic, people from both the poor and middle class have been scrimping and buying less, which explains why veggies, poultry and pork vendors are glum with their sales stagnant even during the holiday season.

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But then comes El Nino, with a third of our provinces already experiencing, and more come March till June, when temperatures increase and the soil cracks with little rainfall. NIA may be trying its best efforts, but that isn’t immediate relief.

With NFA rice out of the market, the price of rice is wholly dependent on the private supply chain, which explains why the cheapest is in the mid 40-peso range for the E-income class, while the lower D middle class forks over 56 to 60 per kilo, and the so-called upper middle class pays 65 to 70 for the staple.

I have always written since last year that depending on the severity of El Nino, we might even face shortages by the lean months or earlier.

Hopefully, Secretary Tiu-Laurel’s supply agreement with Vietnam will assure us of enough supply, but since NFA cannot import any longer, prices will be private importer-driven, which means higher.

Now DA through USec Roger Navarro proposes that NFA rice should supplant the cash that DSWD gives to 4P beneficiaries. It’s a good idea we ourselves proposed in 2022 after PBbM assumed the agriculture portfolio.

But it is not that easy to implement. The logistics is daunting.

4.4 million beneficiaries multiplied by, say, 25 kilo sacks per month means close to 5 billion per month, or 60 billion pesos per annum, and the distribution efforts will be herculean, even with LGUs cooperating.

It would have been possible if NFA still retained its marketing network, with DSWD giving out rice coupons redeemable through NFA’s retailers instead of cash, but the Rice Tariffication Law has erased that.

Now what about the middle classes, from D-2 to C, whose earnings can now hardly cope with increased food prices, high transport, high electricity and other vital necessities?

They have become the nouveau pauvre, even as the nouveau riche of the benighted land, wallowing in wealth created by powerful connections and political entitlements, spend on luxuries like there is no tomorrow.

The other problem is more externally brought — power and transport costs are soaring as the dragon flies, fanning unending wars and conflict, with shipping upended, and oil ever-increasing.

Wages cannot catch up, because employers make scant profits, if at all, squeezed between increasing costs and diminishing demand, especially the MSMEs which Albay’s Joey Salceda estimates to be 98 percent of our employers.

For our congressmen, the solution is always “ayuda.” Not to be outdone in the bleeding-heart department are our senators who have just passed a mandated 100 peso daily wage increase.

The SMEs, most of whom are middle-class entrepreneurs, will soon join the ranks of the nouveau poor, where their micro-enterprise brethren have since languished.

Our government keeps giving paeans to our hard-working MSMEs, but, in reality, policies on the national level, and the rules and regulations on the local and agency-level are designed to make life more and more difficult for the middle class, be they small entrepreneurs or the ordinary working-class.

We have local tyrants who use their power to give and renew business permits to get under-the-table payments, to national agencies which protect their turf by ponderous registration requirements, to the internal revenue examiners who, envious of the lifestyles of their counterparts in the BoC and even their high officers, keep seeking ways and means to bedevil small businessmen — all of them making life more and more miserable for the middle class.

“Hindi na nga nakaka-tulong, name-merhwisyo pa” is the usual complaint against government officials.

The E-income class are better off actually. They have all sorts of ayuda, and they can sell their votes to the highest-bidding candidate every three years, not to mention the loose change from barangay elections.

The middle class have to fend for themselves against more and more difficult odds, their tribe vanishing ever more, be it under the Bagong Pilipinas or the “bagong luma” born on this day 38 years ago that inherited the New Society.

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