The year 2015 opened with two pieces of big news – one good, one bad.
The good news is that Brent plummeted to a six-year low, to $47.36 per barrel, on Jan. 12, from its high of $115 per barrel in June 2014.
The bad news is the Jan. 7 to Jan. 9 terror that erupted in Paris in pursuit of Islamic extremism in the center of the western world’s liberty, egalitarianism, and brotherhood – France.
The three terrorists who killed 17 people in three days of violent spree (12 in the office of irreverent magazine Charlie Hebdo on Jan. 7, one policeman on Jan. 8, and four in a Jewish grocery on Jan. 9) apparently felt or remained marginalized despite France’s seemingly egalitarian society. Police killed the three by the third day.
Of France’s 66.5 million population, 45 percent are Christians (mostly Catholics), 35 percent are irreligious or agnostics, and 4 percent are Muslims.
Heads of state of at least 40 nations from Europe, Africa and the Middle East (no senior United States government official participated) joined the march of 1.5 million Frenchmen for four hours for four kilometers in Paris to denounce violence and the attack on “Liberté, egalité, fraternité”.
“This afternoon, Paris will be the world capital in the fight against terrorism,” declared French Foreign Minister Laurent Fabius on Europe 1 radio Sunday morning.
Meanwhile, the 59 percent crude price drop will mean lower prices of nearly everything since oil is a major cost of most items in the consumer basket (the so-called consumer price index or CPI).
Of 100 points of the CPI, food gets 38.98, drinks and tobacco 1.99, clothing and footwear 2.96; housing, water, electricity, gas and other fuels 22.46 percent, furnishing and appliances 3.22 percent, health 2.99 percent, transport 7.81 percent, communication (telephone) 2.26, recreation 1.93, education 3.37, and restaurant and miscellaneous goods 12.03 percent.
Energy, which is mainly oil, is now about 20 percent of total manufacturing cost. Oil is a bellwether commodity—the one scapegoat greedy companies, from food manufacturers to electricity retailers to gasoline companies to peddlers of water, telephone, and mass transport services blame to justify high prices despite contrary evidence.
Housing, utilities (water, electricity, gas and other fuels), transport, and telephone, together, are now the second largest contributor to the Philippine CPI (which still uses 2006 as base year), at 32.25 percent. This is second only to food, which is 39.98 percent, as a major family expenditure. The 32.25 percent utilities weight is grossly understated.
The anecdotal evidence is that families now spend half of their income on utilities (particularly electricity), transport and telephone, thus driving many Filipinos to perpetual penury and poverty. The Social Weather Stations says 55 percent of Filipinos consider themselves poor.
It is a good thing 83 percent of Filipinos are Catholics; otherwise, they would go berserk just like those marginalized Muslims who have embraced radicalism.
Instead, it is the utility companies – electricity, water, telephone –which have gone berserk by charging the highest prices in Asia for among the lowest quality of service available. Government is hapless is dealing with them, largely the result of regulatory capture.
A Metro Manila wage earner makes P480 ($10.66 a day). Of that, he spends P100 for food (20.8 percent) and P150 for transport (31.25 percent). That leaves the wage earner a take home pay of P5,980 (P230 x26 days) out of gross monthly of P12,480 (P480x26 days). From that P5,980, the wage earner must deduct, monthly, P1,000 for electricity and another P400 for water, leaving him with P4,580. From this P4,580, he must spend monthly for rent (which is P5,000/mo. for a 20 sqm space in Metro Manila), for food (which is 39 percent or P4,867 of his monthly wage); for the schooling of his children which is P421 (3.37 percent of P12,480), health (P373), clothes (P369), and P1,501 for eating out.
Thus, once the wage earner allots P5,000 for rent, he can no longer eat, cannot send his children to school, cannot clothe himself and his family, buy themselves medicine, nor take a stroll at the mall. He doesn’t live like a human being.
Yet, the Philippines is perhaps the only country in the world that defies the impact of the downward trend in crude price. In Manila, water, electricity, telephone, and mass transit rates are increasing.
Instead of lowering mass transit railway fares, the Aquino government has increased them by as high as 87 percent. The justification for the increase is spurious and illogical — to help maintain the MRT, reduce state subsidy for the MRT, and improve service.
The MRT 3 is not maintained simply because it makes a lot of profit for the maintenance company not to maintain it. And among the owners of the maintenance company are those related to ranking transport officials. Hence, the MRT 3 service will not improve, unless you oust the maintenance company maintaining it and you oust the ranking transport officials related to the owners of the maintenance company.
As to President BS Aquino’s justification that he is freeing 86 percent of the nation (especially those in Visayas and Mindanao) from sharing in the burden of the 14 percent who use the MRT and LRT, it is like saying you cannot spend half of the defense budget for Mindanao because the people of Luzon had nothing to do with the rebellion in the south.
Besides, nearly all the 100 largest corporations and the 20 richest Filipino billionaires are based in Manila and 70 percent of economic output is produced by Luzon, why spend 50 percent of security money for an island that contributes less than 20 percent to the economy?
That kind of argument is tribalism at its worst. The tribes of Luzon – the Tagalogs, Ilocanos, Kapampangans, Bicolanos – have nothing to do with Warays of Eastern Visayas, the Cebuanos of central Philippines and Christian Mindanao and the Muslims of the south. Is that what BS Aquino is saying?
When Pope Francis arrives in Manila tomorrow, he will see for himself whether there is “Liberté, egalité, fraternité”in the Philippines.
Being a Jesuit, surely Francis won’t miss the paradox of poverty and corruption amid a sea of prosperity.
From what I know of Jesuits, they do inspire – and foment – revolutions.
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