Thursday, March 31, 2011


The formerly Gokongwei-owned Sun Cellular made its mark in the local cellular service market by providing unlimited calls and texts between Sun users. Soon after, Smart and Globe had to step up their services and lower their prices, and the relatively competitive environment was good for business, and for consumers.

Now with the battle of cellphone providers becoming limited to PLDT (Smart, Sun) versus Globe, people are worried about a non-competitive atmosphere, where ‘unlimited’ will be dropped, to be replaced by higher-priced services.

I’ve already dealt with the wrongness of calling for antitrust, which would further encumber the already encumbered telco industry and eliminate potential competition to come from SMEs.

This time around, I’d like to point out how the question of ‘unlimited’ services continuing is dependent on the level of competitiveness in the industry. When Sun was owned by the Gokongweis, the ‘unlimited’ service for cellphone and broadband was provided not “for the welfare of the poor” but for profit.

Manny Pangilinan can try to raise prices, since it is ‘only’ Globe that he has to deal with, but such an action won’t get far, if the NTC does not butt in and harass potential players in the market. Besides, we are already hearing news about San Miguel stepping into the fray, which goes to show two things:

1. The industry is indeed overregulated, with only the biggest and politically connected firms able to pose a significant threat;
2. In spite of such regulations, there will always be a countering force, even if this comes in the form of a (former?) crony company, San Miguel.

In conclusion, as long as the profit motive is allowed to proliferate, we won’t have to worry about ‘unlimited’ call and text services being cut off. If it enriched Sun during the Gokongwei days, it will continue to be a lucrative service up until consumer preferences evolve over time towards something else entirely; that is, unless the NTC, BIR, DTI, SEC, etc. mess things up for everyone.


I recently had a Facebook discussion, on the global financial/economic crisis, with the blogger of SYNTHESiST. He teaches adjunct at the Asian Institute of Management. I initially pegged him as a neoclassical/Keynesian, which is the impression I got from our little exchange, but he refers to himself as “neo-Schumpeterian, co-evolutionist, institutionalist.”

Debates are largely wastes of time, and the reason is psychological. When people take up positions on a certain issue, what happens is that the issue is transferred to a separate portion of the brain from that involving one’s reasoning faculties. The educational process is hampered at that point, and even the most logical or rational argument will fall on deaf ears. But if you are self-aware enough to let go of your defenses and respond like a student, it can be instructive to see at what points you differ with ‘the enemy’; you just might find areas in your thinking on which to improve, or at the very least you can refashion your arguments to be more convincing.

So my discussion with SYNTHESiST begins with a mutual Facebook contact posting about the idiocy of using GDP as a measurement of an increase in standard of living, to which SYNTHESiST comments:
It actually depends on the type of problem that is being confronted in terms of business cycle. Inventory-change based cycling need only interest-type responses.
A collapse in aggregate demand because of a problem of confidence when banks refuse to lend that also cuts the credit multiplier is a different monster altogether. This is when Keynes suggest the government step-in with results that work from 1935 - 1980 until the first stagflation.
For the 2008 crisis that was global in scale, the bigger rescue like quantitative easing invented by Bernanke was necessary. Unfortunately, because of its success we do not have the luxury of a counterfactual proof - i.e. would the gridlock in financial flows, if no QE was done as libertarians recommend, have resulted into a revolution in the streets of America, for example. Or famine in the Philippines.
I myself do not want to take that risk for a strategy that can moderate the volatility. The demonstrations in England from the austerity program of the Cameron government gives us today a mild peek of the troubles we would have experience if the global financial traffic jam had happened without QE.

SYNTHESiST is recounting two main policy approaches in history, where if the problem is big enough, there is a perceived necessity for the central bank to engage in quantitative easing (QE), that is, massive buying of securities from the private sector, thereby injecting the markets with additional money supply. There is nothing fundamentally different here from what the US Federal Reserve is doing in suppressing the interbank lending or ‘interest’ rate, which has stood at near 0% for a couple of years now.

SYNTHESiST is concerned that without such QE, markets would have gone to shit, that is, even more to shit than they have; not only would the US and other crisis-affected countries have been plagued with high unemployment, but there would have been violent riots and greater political destabilization. As worrisome is the scenario presented, I find it necessary to ask:
Maybe QE doesn’t work after all, but merely postpones the ‘day of reckoning’? Hence the apparent ‘success’ of Keynesian remedies, only for ‘the big one’ to hit such as in the 1970s and the one ‘libertarians’ are expecting to come when QE2 fails to ‘boost aggregate demand’ a year or so down the line.

Wednesday, March 30, 2011


So there are initial reports that China has had the three Filipino ‘drug mules’ executed.

Capital punishment is a ‘barbarous relic,’ to use the Keynesian phrase. And for all the economic progress China, Singapore and other countries have attained over the last few decades, what is missing is an explicit understanding of liberty and property rights that would otherwise dispel the supposed necessity of murder or vengeance in human affairs.

I recently wrote on how even coerced limitation of convicts’ mobility, i.e. imprisonment, is contrary to free society. Executions are several steps further back. Acts of physical violence are only justified in self-defense, and imprisonment and the death penalty are not self-defense.

To compound the tragedy of the executed Filipinos’ situation, their alleged criminal offense, of transporting drugs, should not even be a crime, with no victims involved.

To say that drugs, in themselves, ruin the youth and make degenerates of them, is like saying that fire, in itself, is detrimental to humanity because it burns people’s houses. It’s like saying greed caused the 2008 financial crisis, rather than explaining whose greed (bureaucrats and their cronies in Wall Street).

Society, whether in China or in the Philippines, has a long way to go to be properly called ‘civilization,’ that is, a system of property rights and free association. As long as coercive government remains a means to man’s ends, “the name of ‘man’ he has yet to earn.”

Related articles:


I am no fan of Willie Revillame, but this incident with Jan-Jan, the boy who danced ‘provocatively’ on ‘Willing Willie,’ is just another one blown out of proportion. We’re now hearing of possible criminal liability, and of the ‘psychological cruelty’ inflicted on Jan-Jan.

Those people in the Commission on Human Rights (CHR) who plan to investigate the matter are imputing vulgarity and obscenity where there is none. As if that dirty stuff was going on in Jan-Jan’s mind when he danced. It is far more likely that he was frightened to tears (he wasn’t even really crying) by the large audience watching him. Babies and children, even adults, undergo this disorientation, and later overcome their shyness or anxiety in such a new environment.

Willie, who doesn’t let a milking opportunity go to waste, was uncharacteristically conservative as he stopped the boy from adding to his presented repertoire of mimicked sensual moves. Willie probably knew that uptight and self-righteous attention seekers would berate and threaten him. The point is, he was far from being insensitive, whether to the boy Jan-Jan, or to the holier-than-thous in so-called civil society and government.

There are far greater actual abuses being done in households behind closed doors. I guess it is the inability of the CHR to discover these real indecencies that makes them resort to targeting the obvious and public figures.

What would be traumatic for Jan-Jan is if the CHR folk, in conducting their nonsense investigations, harass the boy for testimony, and drill into his brain that he is an abused child; by the time he grows up, he would have the sexual hang-ups that make for poor quality of social interactions.

Often the best solution is the simplest one: move on, and turn the page.

Tuesday, March 29, 2011


Just hours after the announcement of Pangilinan-led PLDT buying a majority stake (51.55%) in the Gokongwei-owned Digitel-Sun, we are already hearing calls for stricter ‘anti-monopoly’ or antitrust legislation.

Many are worried that by dominating the market, Pangilinan will be able to raise prices with abandon, at the expense of the general interest or common good. Press releases do not help alleviate fears that operations of Sun will be kept separate from that of PLDT or Smart.

People couldn’t be blamed for such concern, but they should not make a mistake of trying to stop the profit motive or profitable enterprise, through antitrust. It is in fact the lack of profitability that makes for poor services and lack of choices.

The only reason a threat is perceived in the Digitel acquisition is because there are so many barriers to entry in the industry, thanks to high taxes, useless red tape, plentiful regulation, and the need for government franchising. As a result of such government intervention, the only ones left in the playing field are the richest of the rich and the politically connected, whose dominance in the industry is greater than would have occurred had government stayed out of it. Antitrust would only compound these earlier government mess-ups by further reducing profitability and the available capital of each company, resulting in even worse service for all.

Largeness and profitability are not ‘anti-competitive’ when there is mutual benefit and freedom in transactions with customers. For progress to occur, action must be taken in the direction opposite to that of antitrust ― towards freeing the markets. SMEs could only benefit when left alone; it won’t help to simply take down the big guys for taking down’s sake.

Earlier related articles:

Monday, March 28, 2011


Oplas, Bienvenido ‘Nonoy,’ Jr. Health choices and responsibilities. Central Book Supply, Inc., Quezon City, Philippines. 2011.

I generally don’t like writing about health care. It often involves funky-smelling bodies, secretion of fluids, and all that gross stuff. So I’m glad that someone bothers to write about that crap instead of me.

Nonoy Oplas, who heads Minimal Government Thinkers, and is the country’s staunchest opponent of the anthroposociocalicegenic global warming scam, recently compiled his 2009-2010 writings with regards to health care and drugs, based largely on his experiences as a member of the Department of Health’s Advisory Council on Price Regulation.

Oplas sets his sights on the bureaucracy and is relentless in his attack. Even though it has only been three years since the passage of Republic Act 9502 or the Cheaper Medicines Act, it is not too premature to say that when it comes to the provisions on price control and compulsory licensing, the law is a failure.


The effects of price control after a year of implementation surprised me. Although one would expect a simple case of a supply shortage due to price ceilings, the statistics show that with regards to drugs covered by the government measure, there was a decrease in quantities sold. Oplas explains this by saying that the poor who needed such drugs were already buying these drugs, or already had much lower priced generic drugs as an option even prior to price control. It seems to me that retailers also shifted their purchases to non-covered drugs, and manufacturers cut down on their production of those covered by price control, hence the lower quantities. Who suffers because of this?

The selection of the drugs to be covered, is itself abhorrent, in that politicians chose the most popular brands. That means that drug companies were penalized for providing the drugs most desired, and presumably the ones most needed, by the public. Because of state meddling, medicines are unable to naturally go down in price, as they would have if a competitive environment was permitted. The price control program is a powerful example of how government makes things worse.


Sunday, March 27, 2011


One could easily surmise that the Office of the Ombudsman’s inaction on the many cases filed pertaining to corruption in the Arroyo administration, was due to Merceditas ‘Merci’ Gutierrez being ‘like this’ [twining fingers] with the then first couple of Gloria and Jose Miguel Arroyo.

It seems like a sufficient reason to file an impeachment case against Gutierrez. And it is hard not to appreciate that the House of Representatives managed to impeach her this past week.

As an aside, it’s funny how the then-opposition-now-administration congressmen see the impeachment vote of 212-46-4 against Gutierrez as a triumph of principle, with the president Noynoy! Noynoy! Noynoy! being heaped praises as the unifier of forces against evil. But in previous years, during Arroyo’s term, these same congressmen had sought her impeachment, and when this failed due to a lack of numbers, the impeachment process was derided precisely for being a ‘numbers game.’

But going back to the matter at hand, I find it hard to really give a rat’s ass about the impeachment trial to take place on May 9 in the Senate. In the first place, the senators will look like doofuses in their gowns. Second, it’s going to be the same party politics, where the administration is hard-pressed to muster the necessary three-fourths vote to finally remove Gutierrez from office.

I think the whole concept of a separate court and prosecutor’s office for public officials, as we have with the Sandiganbayan and Ombudsman, respectively, just confuses matters of justice. People should be tried as private individuals in relation to property rights transgressions against others ― nothing more.

To charge people with offenses such as ‘betrayal of public trust’ is just nonsense. Whose rights, specifically, were violated? A blanket ‘the people of the Philippines’ makes for catchy rhetoric, but is substantially worthless. I also find the notion of criminal prosecutors, as opposed to hired attorneys representing a litigant, to be specious, for the same reason.

The supposed reason for a public prosecutor, and separate courts to try public officials, is because we are dealing with taxpayers’ money. But taxes in themselves are unjustly obtained by the privileged minority or political elite. Leaving aside a tax refund corresponding exactly to every taxpayers’ coerced payments, there is no way to ascertain ownership of this stolen money.

We are veering further and further, to untangle, unlock, trace back, unwrap these layers upon layers of falsehoods that hold up the rotten institution that is government.

Once we undo such embedded thinking, we see public prosecutors and collective liability as ridiculous. Sure you can say that someone is incompetent or remiss in their assigned tasks, but how do you prove incompetence or one’s being remiss, so as to hold this person liable?

In a free society, i.e. in a society without government or any coercive institution, people simply switch brands or shift to competitors for every service, when dissatisfied. Is this applicable when it comes to litigation?

Surely one should have all the right to choose prosecutors/lawyers to represent them. And the ‘privatization’ process does not end here ― the courts themselves are to be totally private, competing with each other for reputation as just arbiters.

Saturday, March 26, 2011


This ‘Earth Hour’ business reminds me of U2’s video for ‘The fly,’ where a message is flashed on a screen: “Everything you know is wrong.” [If only Bono took his advice ― instead of sucking up to the powers-that-be in order to “make poverty history,” not realizing he was the spokesman of the bureaucratic status quo.]

Not everything we know is wrong. But it’s a good thing to keep in mind when meditating on social issues.

It’s been over a year since Climategate, the big exposé involving ‘global warming’ scientists manipulating data as part of the political elite’s scheme to cash in on people’s apocalyptic fears. Yet Earth Hour 2011 is stronger than ever, especially in the Philippines.

Participants in this annual ‘return-to-the-primitive’ ritual spend the rest of the year with a bad conscience, of the idea that they’re destroying the atmosphere with each switching-on of the light, while waiting to do ‘penance’ the next year. If only they knew had they nothing to be guilty about, except for being foolish enough to believe such claptrap.

Earth Hour 2011 is a worthless exercise, and the idea behind it, of the global warming-climate change monster, is responsible for diverting resources from where they would have done more good. It is especially damaging for those people in developing nations, who rely on coal-based energy for their daily needs. Other adverse consequences are more indirect; just the fact of taxing citizens to fund these ‘green’ programs is already a drain on incomes, jobs and output, resulting in a lower standard of living.

I’m not saying that alternative sources of energy are not viable or desirable. As the Middle Eastern crisis continues, it would be practical to find and develop cheaper and more efficient sources. Cleaner sources are an advantage, in that polluters’ liability is reduced. But to speak of catastrophe where there is none, is for the suckers. I’ve dealt with the nonsense of global warming in an earlier article.

We also have to keep in mind that other sources of energy are not as clean or environment-friendly as they are made out to be.

And before most of so-called renewable energy gets cheap, there will be a need for large allocations of capital that would keep it out of reach, price-wise, from the regular Juan or Joe, for years to come. Measures such as the Philippines’ Renewable Energy Act merely distort market signals as to which industry meets consumer preferences, although it is hoped that any tax incentives involved are granted to all players.

People are generally gullible in listening to politicians and their cronies and paid media hacks, who feed on the public’s fear as well as their sympathy for fellow men ― two emotions that, when not guided by logic, often lead to the endorsement of inefficient and crooked state programs.

A good rule of thumb: Doubt everything you read in the paper. You can be less skeptical about some facts, such as the fact that so-and-so held a press conference, or that they said this or that. But with regards to the principles or theories behind such statements, it is best to filter most of it, and even then be suspect of the speaker’s intentions.

This rule goes for both politicians and advertisements. At least with consumer products, a company has to deliver on its claims, for you to continue patronage. All governments have to do is fool a majority, often done via fear-inducing propaganda, and even if you yourself don’t fall for BS such as climate change or Earth Hour, you would have no choice but to go along for the ride, which would tend to involve taxes.

The best you can do is to get the message out to as many people as you can: “Don‘t take any shit from anybody.”

And turn the lights off… for the sake of your electricity bill.

Related article: Earth Hour lunacy, by Nonoy Oplas.

Friday, March 25, 2011


It’s uncanny how even when the Bangko Sentral ng Pilipinas speaks on price increases, that blame is directed towards “growth in demand” and events in the Middle East that affect the scarcity of oil, while nothing is said about the role of the central bank itself in all of this.

If central banks had nothing to do with the issue, why are they raising lending and borrowing rates to temper price increases? It’s almost as though there were a conspiracy among media and government officials for nothing to be said about the central bank inflationary mechanism.

It is taken for granted that whatever the policy rates are, are the proper rates; that these do not have an effect in and of themselves in prices; that the changes in loan rates merely affect ‘liquidity.’ Yet the continued rise in overall prices since the 20th century is due to central banks themselves. This is because the international central banking system is premised on printing monetary notes, in the belief that doing so adds to the existing wealth, a la the biblical multiplication of loaves and fish.

BSP Deputy Governor Diwa Gunigundo is much too optimistic in forecasting a price increase below 5% in 2012. Aside from pressures in the Middle East, to which we are only witnessing the beginning of political revolutions, much of the monetary printing done by the US’ Federal Reserve and other central banks has not yet had a chance to exercise influence in the markets.

The administration would be quick to point out how high the stock market index has gotten over the past couple of years, but would downplay the effects of monetary printing when it comes to the prices of retail goods. This is hypocritical. If they were more critical and honest about it, they would realize that stock market growth is not a measure of economic prosperity or any sustainable ‘confidence,’ but merely the amount to which central banks have irresponsibly increased the money supply.

There is very little the BSP by itself can do on its own in creating a sound monetary environment that does not lead to periodic crises as we have experienced the past couple of years. It is the US Fed that would have to make headway in this regard. But that is no excuse for perpetuating fallacious theory.

For a short explanation of how loose monetary policy leads to economic crises, click here.


When I saw several comments waiting for me regarding my latest Carlos Celdran-RH bill article, I was looking forward to a pleasant exchange of substantial ideas. No such luck.

So I’ll try conversing with myself once more, and while doing so address some concerns.


Japan has a larger population density than the Philippines. Yet it is the third largest economy in the world.

Maybe the right question to ask is, why are economic resources not enough to sustain whatever the population may be? And it will be found that there are other more relevant factors affecting economic conditions: level of economic freedom, size of bureaucracy, openness to foreign investments, taxes, industry regulations, monopolies, etc.


In light of the above, we must be wary of assuming that the productivity necessary to sustain the present population could be maintained when the number of employees drops over the long term (as it will when population dips). It will not matter whether a couple has one mouth or ten mouths to feed, because the level of output in a community changes in relation to the size of the working population.


Resources are not infinite. That is the whole point of studying economics. A contraceptive program will do nothing to uplift economic conditions ― as we have learned from points one and two above ― while at the same time depriving people, rich and poor, of resources that would have made for the creation of jobs, goods and services.


Who says being against the RH bill is being against contraceptives? The crucial question is, why involve government at all? If reproductive health is such an important matter to so many people, then surely contraceptive programs could be sufficiently funded by private organizations.

In light of points one, two and three above, a private, non tax-paid program would be the best option for those who want to spread awareness on contraceptive use.


I say ‘possibly’ for a reason.

Here is some relevant literature, for those of you who could read:
Making economic sense, by Murray Rothbard
The Malthusian trap, by Benjamin Marks
Why we don’t need population control, by Filipino Freedom Fighter

Thursday, March 24, 2011


Carlos Celdran, the famed ‘Damaso’ sign holder who is lobbying in his own way for the passage of the ‘Reproductive Health’ bill, is in the news again, for tearing out anti-RH bill posters outside the Catholic Bishops’ Conference of the Philippines compound in Manila.

I’m not saying that Celdran is a nincompoop, but his actions sure reflect that.

It’s quite peculiar that someone who fashions himself as being of an enlightened view is so eager to quash any debates or information exchanges regarding this touchy issue, to the point of disrespecting other people’s private property (the CBCP posters).

His own shameful acts have been tolerated for too long, yet he feels encouraged because he’s of the notion of being a martyr for the cause.

Celdran claims that ‘The Church’ has done far worse harm than his own displacing of posters. So what is he saying, that the CBCP members are child molesters? That they burned heretics during the Inquisition? His own inability to see people as individuals rather than as a collective is indicative of his poor intellectual skills.

Why is it considered oppressive for CBCP officials to have a voice in policy matters just like any other citizens? And they are pleading for less government influence, not more. The key is that their opinions do not manifest as coercive law, as was the case in earlier centuries.

‘Separation of church versus state’ is supposed to be about religion not dictating people’s lives by force, i.e. by the government. Yet RH bill advocates are so eager to use the coercive hand of government to “spread awareness of women’s options” or to bring down the population to some supposed sustainable level.

The economic theory behind this is nonsense of course. People simply assume what would be the ‘optimum’ population level, while:

1. thinking that the amount of infrastructure to accommodate people is unchangeable;
2. ignoring the uneven concentration of people around the islands; and
3. assuming that employment levels and output could be sustained when population level drops.

In short, this notion of insufficient resources due to overpopulation is an illusion. We should look for answers elsewhere as to why the economy sucks.

So there is absolutely no reason to admire Celdran. Not only are his means reprehensible and tactless, but his rationale is complete shit.

Update: For more on the moronic RH bill advocacy, see my follow-up article here.

Wednesday, March 23, 2011


Leafing through today’s (March 23, 2011) Inquirer, we find a full-page ad stating that “Freedom of expression and of speech is not unlimited,” written by a certain Atty. Redemberto R. Villanueva, which alarmed me. The lawyer cites jurisprudence that does put limitations to what a supposedly free person could say or write.

It is quite fitting that it turns out that this Villanueva is counsel of, of all people, the Ampatuan family, who are mere ‘suspects’ in the murder of four dozen people in November 23, 2009. The full-page ad is an attempt at getting the public off his clients’ backs.

It was a touch of genius on Villanueva’s part, to relate the Ampatuan case to that of Lauro Vizconde, who not long ago was admonished by the Supreme Court for suggesting that some of its justices were ‘influenced’ by the Webb family to set convicted Vizconde ‘massacrer’ Hubert Webb free. By making this connection, Villanueva is able to get on the good side of the Supreme Court justices, so as to avoid any overturning of anti-free speech jurisprudence. And in the event that the Ampatuan murder case reaches the Supreme Court… well, every bit of good will helps.

Actually, Villanueva simply wants to extend the concept of sub judice ― which bars counsel, plaintiffs and respondents from commenting on a case to the media ― to encompass the media, nay, the public at large. There might be some rationale for requesting discretion from those involved in a case, but to stop all other parties is just plain unjust.

I’m glad to have seen this ad, as it shows everyone just what types of people want to see freedom of speech curtailed: those in positions of political power who fear losing it; those who see no other means of salvaging their reputation than by the coercive hand of government (which is what the charges of libel and slander amount to).

We could now see the value of the ‘right of reply’ bill that senators Nene Pimentel and Miriam Santiago, among others, sought to pass a couple years back. Such affronts against freedom are revealed to be no more ‘just’ than having someone hold you by the throat and making you tell them what they want to hear. This and other similar laws are legislated barbarity.

I leave it to my 2009 self to give a couple of reasons why libel and slander are unjust:
- People should be free to write or say anything about someone or some group, at the risk of others doubting their credibility and of thinking them distasteful.
- Just because one esteems the public as stupid and gullible does not mean limitations should be imposed on what another could say or claim.
In addition, libel and slander are ultimately not about defense of reputations, but control of the channels by which the statements are aired. If one is to be guaranteed a right to their property (which is essential to civilization, as I often say), libel and slander would be unenforceable.

Hopefully, further discussion on the matter will bring about an overturning of the present oppressive jurisprudence, not to mention a repeal of present libel and slander laws. But I’m not too optimistic about it.

Monday, March 21, 2011


With regards to Muammar Gaddafi (Gadhafi, Kadafi, Whateveraffy) fighting off rebels with force, we are looking at a situation similar to Germany and Japan before the Allied Forces saved the day, or like Saddam Hussein before he was vanquished by the US’ ‘War on terror.’

It is unfortunate that the seemingly most viable option is for other countries to unite together and ensure that the mad dictator doesn’t slaughter his people, the ensuring of which would involve air strikes and possibly an invasion or political takeover


It could not be denied that most arms are possessed and controlled by each country’s monopoly on force, the military. We are thus denied the best possible option, of allowing private individuals to band together and voluntarily use their resources, and face consequences ― legal (charges of property rights violations) and non-legal (risk to life) ― of entering foreign lands to stop whoever the oppressor may be.


When governments unite against a common enemy, there are several things to lament:

1. Such an endeavor entails the use of economic resources that would have otherwise allowed for more jobs and productivity.
2. Foreign intervention is done for political, imperialistic ends, in the guise of ‘waging war on enemies of freedom,’ and we could expect increased political influence of the invaders after all is said and done.
3. Since governments, even dictatorships, are ultimately determined by public opinion, the incongruity between the outside forces and the ‘will of the people’ is especially pronounced and makes for greater political imbalances.


Furthermore, the present ‘rebels’ in Libya who are subject to attacks by Gaddafi ought to know the risks they have taken in their fight for freedom. This sounds cruel and might be misconstrued as me being sympathetic to Gaddafi. But my point is that the Libyan protesters should not expect the relatively peaceful power transitions as occurred in Egypt or the Philippines. And there are other means of protest aside from merely gathering in throngs.

If there are enough Libyans to make a political difference, this would include a defection of military elements by which the dictator is significantly weakened in his coercive actions. The government machine could then only run dry for so long without the people’s tax ‘contributions,’ and would be unable to withstand a publicly supported coup (or at least, a coup that has the semblance of public support).

Keep in mind that this is not a judgment on the ‘goodness’ of the opposition either; we are only considering shifts in political power, not the justness of such.


Dictators suck, but are fundamentally no different from any political rulers, including the Philippines’ Noynoy! Noynoy! Noynoy! Governments are necessarily funded by robbery, i.e. taxation; retention of public support involves a balance of oppressing the people enough to obtain sufficient funds, but not to the point that they seek out a new batch of oppressors.

In Gaddafi’s case, we should be wary of cheering knee-jerk measures that make for longer-term political instability.

Sunday, March 13, 2011


Even if one concedes that it is best to leave government out of the market process, it might be more difficult to convince them that the government should not be involved when it comes to dealing with natural disasters such as earthquakes and volcanic eruptions. Case in point, the recent intensity-8.9 earthquake and ensuing tsunami that hit Japan.

After seeing on video the destruction that can occur at the figurative flick of nature’s wrist, it would be crazy to say that people should not organize in a way that would minimize losses to life and property. Surely, the rationale makes sense, but does this justify a government and all that it implies (coercion, expropriation)?

It is not like people have never been able to cooperate (voluntarily) on a large scale for the sake of a common goal, and dealing with natural disasters is no exception. But given that we live in a time of large bureaucracies, it is inevitable that government resources would have to be used in order to maximize the assistance rendered to the needy. But the government’s quote-unquote ownership here is merely incidental, and not a requirement for these resources to be useful. It is bad enough that such resources had to be taken by force from citizens, and it would be worse to render these inaccessible during emergencies.

Whatever actions a government carries out when natural disasters strike should not be seen as ‘the reason we need a government.’ It would not be government policy per se that saves lives, but the fact that such resources were there for the taking, as made possible by free enterprise. Government men and women could very well provide assistance in their capacity as private individuals and not as part of an often encumbering bureaucracy.

Wednesday, March 9, 2011


Last month, a friend of mine from government offered me a job of propagandist in the Department of Finance. I had no intention to apply, of course, but all the same, I was made glad to not have done so, in light of the Bureau of Internal Revenue’s recent Revenue Regulations 2-2011 requiring those who make half a million pesos in taxable income to file an Annual Information Return, kind of the private equivalent of the Statement of Assets, Liabilities and Net Worth that government officials fill up. Meaning, not only do you have to report how much you made in the year, but you have to report your property for the scrutiny of the state.

The fact that this rule once applied only to government officials, as a check on malversation, implies that by not paying your taxes as required by law, you are already stealing. It is being ingrained that it is only at the government’s mercy that we keep possession of those things we sometimes have the temerity to refer to as our ‘property.’

FUELING THE STATE SPENDING MONSTER (Related articles: ‘More taxes in the offing,’ and ‘Conditional cash transfer quickie argument)

Now I believe I’m not covered by this BIR tax regulation, unless I win the state lottery or something, but this distresses me. This new regulation is the continuation of the DoF’s ‘Pera ng Bayan’ campaign which serves as the state’s excuse to take more money from citizens and prop up the government spending machine.


This is plain harassment. What’s even worse is that businessmen who are subject to the provisions are likely to bend over and comply (“I have nothing to hide!” ― as if that’s the point), with maybe a minor complaint that the April 15 deadline is too soon, but otherwise accepting this new unsolicited control over their lives.

The tolerance shown to such invasions of privacy and private property is also a result of the general population’s confidence in their great leader of the Aquino clan, Noynoy! Noynoy! Noynoy!, in his futile quest to uplift the poor from their plight (futile because he has no grasp of what makes for wealth in a community; it does not involve government at all).


I do hope I’m wrong and that there will be an outcry from this, enough for the government to back down. But I doubt it, because the cronies masquerading as ‘the business community’ are in cahoots with the government and eager to profit from their ‘Public Private Partnership’ projects.


This might just be the final straw for me, to begin considering looking for a new home. Statism is so pervasive and I am not pretentious enough to believe that people are going to wise up on my account, or even in my lifetime. I love this region; I’m so used to the culture, the climate, the accents, the commercials, everything; the streets of Metro Manila will always be a part of me. But with these constantly added intrusions in otherwise peaceful human affairs, I am beginning to long for the air of freedom.

Related link:

My friend Benson Te, who does the Prudent Investor Newsletters blog, wrote on the BIR regulation, here.



It may be that the SALN thing was merely the spin of the Inquirer, and that if you are a tax evader (which I do not condone), it is not as urgent as we thought for you to open a Swiss or Cayman Islands bank account.

Yet this does not mean that the state is not active in its efforts of expanding its influence; after all, the regulation is meant to plug the deficit by widening the scope of taxable assets to be scrutinized, in the absence of any intention of slowing down expenditures.

Let us do a comparison. Here is the ITR. And here is the AIR. Look at how many more blank spaces and categories will have to be filled thanks to the new regulation.

And how different is the AIR from the SALN?

An analogy would be a comparison of the annual budget deficit and the national debt. A country in massive debt is likely to be committing spending follies year in and year out.

Similarly, the Finance department aims to determine how much it could milk in assets, if not from an outright declaration, by inquiring as to the annual income from these. So while not as violative to the degree of being required to fill up a SALN, the new regulation requiring submission of an AIR is a rather big step compared to the already pesky ITR.

Tuesday, March 8, 2011


It is pretty much established that any administration would want to fleece citizens, particularly ‘the rich,’ for as much as they could get away with. So it’s not surprising that news reports have come up about proposals for raising taxes in 2012. Turns out, Ricky Carandang may have been ‘miscontexted.’ In stating that the issue could be discussed later on, Carandang may have meant that there were no plans of tax increases at all. However, news agencies may have twisted this to mean that taxes will be raised in 2012. Typical.

If it turns out that Carandang was indeed understood in context, then that would be disappointing; I figure Carandang to be one of the more sensible people in the Cabinet, who knows most bullshit when he sees it. On the Juana Change video, he stated that he “didn’t care,” which may have come across as arrogant, but the video itself is really not worth a hill of beans, intelligence-wise. Corny pa yung acting.


But maybe there really is cause for alarm. Just today, the Finance department is making parinig about how they are within the budget deficit cap. As if being over P300-billion above budget ― which is four times more than the middle part of Gloria Arroyo’s regime ― is admirable! And the fact that the cap itself is self-imposed, should make you wonder at the low standards they have set for fiscal discipline.

It is quite obvious that they are setting up plans to spend yet more, the financing of which would not preclude raising taxes.

Sure, meeting the cap could be interpreted to mean that no taxes are needed to maintain the budget, but do we really expect the government to take this angle? It is far more likely that they will take another approach: “We have not spent enough; now to really go crazy!” And we have right there the rationale for more taxes.

So what, right? Aren’t they going to spend it on ‘social services’ in order to achieve the supposed Millennium Development Goals by 2015, as is hoped by the Philippine Institute for Development Studies (PIDS)? All of this is already making the brazen assumption that the programs of Noynoy! Noynoy! Noynoy! are going to proceed as planned, with zero kickbacks. Okay, we will grant that, for the sake of argument.


Statist ideology tends to focus on redistribution of existent wealth as the solution to poverty. This takes for granted how such wealth was created in the first place (the free flow of capital) and how such wealth could be sustained (keeping government out).

Is mine a fair assessment of the ‘free market’? What about all the wheeling and dealing involved, lobbyist handouts to congressmen, rigged public biddings, pakikisama among the powerful, etc.? The preceding question in itself belies the claim that political interference would make things better, for it is precisely the politically privileged who gain on the pretext of ‘public service.’


Call efficient business ‘anti-competitive,’ or the freedom to lay off workers ‘inhumane,’ the pursuit of individual interests ‘selfish,’ etc., but it is ultimately consumers, you and I, not those in their capacity as politicians and entrepreneurs, who make possible a sustainable structure of labor that is in line with actual people’s preferences, and ensure through the pricing mechanism that the resulting products (including low-cost education and health care) are relevant to people’s needs. Which is more than can be said about the alternative: state control of resources, whether partial or full.

As I’ve said before, the key to economic progress is not redistribution, but a replication of conditions that have allowed for the creation of whatever wealth exists. It will be found that these conditions do not involve taxes or legislation.


Some would nonetheless claim that all this theorizing in the name of freedom is not so important as to act now to help the needy, with the urgency of poverty upon us. This in fact reflects a view that people are so base as to require a privileged minority's coercion in order for the marginalized to be tended, which in itself has its own contradictions ― Aren't politicians supposed to act in accordance with the will of this same uncharitable populace, as is assumed by democracy? And can politicians, who are people themselves, escape such baseness when it is presumed to be inherent in this same uncharitable populace?


When one puts their mind to the problem of poverty, all state involvement in human affairs is revealed to be not only nonsense, but dangerous and reprehensible, good intentions notwithstanding.


My friend Nonoy Oplas has written a related piece, criticizing the recent PIDS paper. Do check it out! Here.