More 'peace bonds' as poverty rises

DIE HARD III
Herman Tiu Laurel
09/10/10



Ihe latest poverty survey of the Social Weather Stations (SWS) from June 25 to 28 tracks a new rise in self-rated poverty — from 43 percent (or 8.1 million families) to 50 percent (or 9.4 million families) — for the first two quarters of 2010. This was the same period that posted a 7.9-percent “growth,” according to the economic managers of Gloria Arroyo and PeNoy Aquino. Worse, food poverty went up, from 31 percent (affecting 5.9 million households) to 38 percent (or 7.2 million households).

Much of this increase in poverty in the rural areas, especially in Mindanao, makes food poverty or hunger particularly troublesome in light of the PeNoy government’s solution, which is to get identified poor families queuing for P1,400 monthly while denying the National Food Authority (NFA) any fund for price support to farmers who form a big part of the poor. All these as the business headlines trumpet PeNoy’s so-called Public-Private Partnership (PPP) scheme, with “Discount bonds to fund PPP” and “Taipans queuing for PPPs.”

The concept of “discount bonds” is the same as the “zero coupon” bonds at the heart of the Code-NGO PeaceBonds infamy, which SGV man Cesar Purisima, now at the Department of Finance, explained as being “… so-called because they do not pay interest but are sold at a deep discount and later redeemed at full face value...”

Actually, the interest is all paid, compounded at that, at the end of the maturity period. So it turns out to be a whopping amount, where government which got, as in the case of the PeaceBonds, say, P10 billion in 2001 (when the bonds were issued) will have to pay an amount such as P35 billion upon maturity (in 2011).

The discussion on the PPP zero coupon bond is not clear at this point because Purisima and Butch Abad are still throwing many figures around — from a low of P15 billion to a high of P200 billion (in projects), and even up to P400 billion by 2013. Then, as Purisima says that these bonds will be sold to “pension funds,” does this mean the Government Service Insurance System and the Social Security System? They have not explained as yet.

Speaking of these pension funds, we have been wondering why Franklin Drilon is raising a howl at this time when the high salaries and benefit packages of government-owned and -controlled corporations (GOCCs) have long been known and when, at most, the guilt would only be “insider trading.” Is there a hidden agenda in the timing of these exposés? Some are wary that these may just be a prelude to a new drive to “privatize” the pension funds that started with the financial mafia’s appointment of Vitaliano Nañagas in 2001, who was ousted when the unions opposed it.

Then, in explaining the bonds to be used in the PPPs, Purisima referred to countries with similar programs, such as Indonesia and India; but it only goes to show that these schemes are being pushed by Finance. Reports also say that proceeds of the bonds will “become part of a fund the private sector can tap for PPP projects” (with none for farmers’ rice production, as usual). The suspicious part is that the bonds would provide “equity participation or financing guarantees for private infrastructure projects.” In addition, Purisima, Abad, and the business chambers agree that the PPP projects will be on infrastructure, power generation (and transmission, water supply, airport development, and the like. So it will still be the same set-up that has gotten taxpayers into so much financial burden, paying for subsidies to rich corporations.

The energy and electricity sector is where the issue of privatization and undue advantage, given to corporations over the welfare of the people, is most highlighted. As in the MRT fare increase issue, taxpayers and electricity consumers are being made to pay for the next 25 years P932 billion worth of debts, as well as stranded costs left behind by privatization, where the favored foreign and local oligarchs already got a profit windfall by acquiring state assets cleaned of debts, aside from a fuel supply subsidy and the onerous take-or-pay provisions in contracts.

And as there is now a Facebook page called “Protest against Meralco Electricity Price Hike” with 50,000 members, those who are members of that social networking site should therefore support this page by swelling its ranks to millions to show the nation’s outrage. This is but one of the many pro-Big Business policies PeNoy and the Yellows are adopting that’s hurting every Filipino. Let’s take action to demand that only actions to save the public and remedy this injustice are taken: Take back the public utility assets to pay off whatever debts through generated profits. The past decade alone, by Joey Salceda’s own admission, saw these Big Business conglomerates’ earnings at a staggering P3 trillion while the total national debt stood at P4.42 trillion by the end of 2009!

Lastly, let me digress: DILG Undersecretary Rico Puno says he is willing to “take a bullet for the President,” so why didn’t he take the fall for his President when the latter was compelled to “take responsibility” for the recent hostage tragedy? Meantime, given this move, what penance is PeNoy offering? Jesse Robredo will no longer be submitted to the Commission on Appointments, so is PeNoy choosing his shooting buddy over a Ramon Magsaysay awardee? Puno, in defending his appointment, says that Arroyo even appointed her hairdresser and gardener. So Puno now admits that he’s on that level too.

Hans Palacios sent us this text to sum it all up: “It’s the pot calling the kettle black. Congress is having trouble impeaching the Ombudsman because congressmen are forced to go against one of their own kind.” Well, so is PeNoy the same as Arroyo.

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