Privatizing government

Trade and Industry Secretary Peter Favila made a suggestion during the recent MOPC Forum that was shunted aside in the eagerness of the audience to tackle more headline hot controversies. I thought that was unfortunate because it was the one somewhat original concept that was offered by anyone in that lunchtime forum.

Given the level of distrust people have of government in the matter of tax collection and eventual use of tax collection proceeds, Peter wondered if people would be more amenable to a system that allowed obviously big taxpayers to undertake projects themselves for a full tax credit. I have been wondering about such a system myself for years now but dismissed it as unimplementable.

Peter’s idea obviously needs to be fleshed out but it is unfair and unproductive to shoot it down outright. In fact, I think he may have something there, even if I doubt bureaucrats and politicians would let it see the light of day because that leads to loss of power for our power hungry politicians.

I can understand why Peter is agonizing about this conundrum of how to raise tax revenue amidst widespread distrust of government’s honesty and good sense to use the money wisely. Yet, we need public resources for infrastructure to spur economic development as well as to cover education, health and other social welfare needs. We have to move from square one to square two and that is not going to happen if we continue to argue and withhold resources needed to get moving.

I was wondering about the exact same thing some years ago after I read about the success of the Ayala Foundation in nurturing bright and poor pupils in two public schools, one in Tondo and the other in Batangas. Essentially, the Ayala program sets these bright pupils aside, provides them with well-trained teachers, a good curriculum and everything else necessary to maximize their learning experience.

I imagine that after all these years, the Ayala Foundation must have fine tuned the program enough so that the procedures and the costs are established, making it ready for wider replication in more areas. If Peter is thinking along the line that I am, it should be alright to have the Ayala corporations set aside some of the funds they will have to pay in taxes to run more of these schools of excellence. They would then get full tax credit, as if they paid the money to the BIR.

What happens under Peter’s concept is simply, cutting off the middleman... the BIR... taxes go directly to a project or activity the taxes would have funded anyway. Taxpayers can pay directly for Centers of Excellence in education or maybe, elect to adopt an entire public school and make sure it runs efficiently using the money that would have been paid to the BIR in taxes. Companies and possibly high net worth individuals, would still have to file tax returns and the BIR would still have to audit but instead of sending the tax money to the Treasury, it is spent directly to provide a vital government service.

Obviously, the dangers of abusing such a system are many, but we are still in the realm of concepts and no concept should be shut down just because some people think it won’t work. The operational rules can come later. But if I follow Peter’s thinking, he is at least responding to the problem of distrust and still being able to move forward.

In a way, we are doing this already in a somewhat similar sense. For instance, Senate President Frank Drilon opted to tap the Federation of Filipino Chinese Chambers of Commerce to build schoolhouses using his pork barrel funds because the FFCCCI is more efficient and cheaper than DPWH. Why shouldn’t we allow private corporations to also tap the FFCCCI to build the same schoolhouses and get full tax credit? We may end up building more schoolhouses in less time, because cutting off the hopelessly corrupt DPWH saves money and gets the job done faster.

Honestly though, I doubt if there would be any eagerness on the part of bureaucrats and politicians to willingly give up power for the sake of efficiency, cost effectiveness and transparency. I am not one who expects public service from these rascals in office. But the important thing about this wild concept is that it was brought up at all by a member of Ate Glo’s economic team. We need officials who are able to think of big, hairy and audacious ideas if only because the problems we face are just as big, hairy and horrible. Privatizing government, is to me, a big, hairy and audacious concept that deserves full consideration in these desperate times.

Maybe Peter managed to display his conceptual thinking ability because he was barely a week old in his job as DTI Chief. As soon as he has been acculturated in the bureaucracy, he could just as easily turn unimaginative and well… boringly bureaucratic.

I guess that’s the difference between Peter and Gary Teves. I came into that Forum with Gary way ahead of Peter in my mind. Gary, after all, had proven himself reliable, honest, extremely capable and Peter’s banking career had been well... somewhat undistinguished. But Gary seemed a little timid that afternoon, maybe even a little overwhelmed. Peter, on the other hand, relished in the luxury he would soon lose, of dreaming, strategizing in his mind how he is to tackle the problems at hand.

The race has started and it is great that Gary Teves hit the ground running. It wouldn’t hurt however, if he paused now and then to think and dream of big, hairy and audacious plans himself. That’s the only way he won’t disappoint a citizen who would ask him, as someone did in the Forum, why our government has not thought of debt forgiveness, at least for the really bad projects like the nuclear plant. That’s one bold, hairy and audacious thought!

In the salad days of his government service, there wouldn’t be a thought that’s too big, too hairy and too audacious for Gary Teves. After all, he has the genes for thinking up bold ideas. His father, Herminio Teves, the congressman who is over 80 years old, never seems to run out of big, hairy and audacious ideas which he is not shy to share in his releases to us, almost daily.

Expect interesting times after Gary’s father assumes chairmanship of the House ways and means committee. Hopefully, we can expect interesting times too at the Finance department under Gary. Or maybe, his father would make sure of that.

Lufthansa Technik

All the way from Tampa, Florida, comes this email from Pinoy expat, Arnold Tan.

I’m a big fan, and I read your column almost everyday for a year now... Thanks for your exceptional insight and analysis, and for having the balls to put it in print.

Myself a sacada worker (IT), forced to abandon the familiarity and security of home mainly for economic reason. Reading your column takes me back home…

It is particularly a proud moment to hear anything good coming out of the Philippines. It’s heartwarming to read about RP carving a niche in such a lucrative industry as aircraft maintenance. It enables us to keep a few in our talent pool because of innovative industry leaders like Lucio Tan.

The economy was already in a sorry state when I left 15 years ago. I cannot imagine how frustrating it is now… Thanks for giving voice to the plight of the people, and for trying to boost the Filipino Spirit.

I pray for your safety, and for the enlightenment of the powers that be...

Good luck and keep up the good work. We are lucky to have you stick around. Ciao!!!

A Blonde Moment

Orly Morabe passed this one on.

A bloke is in a queue at the supermarket when he notices that the rather dashy blonde behind him has just raised her hand and smiled hello to him. He is rather taken aback that such a looker would be waving to him, and although familiar he can’t place where he might know her from, so he says "Sorry, do you know me?"

She replies "I may be mistaken, but I thought you might be the father of one of my children!"

His mind shoots back to the one and only time he has been unfaithful, "Grief" he says "are you that stripogram on my stag night that I shagged on the snooker table in front of all my mates whilst your mate whipped me with some wet celery and stuck a cucumber up my arse?"

"No" she replies, "I’m your son’s English Teacher"

Boo Chanco’s e-mail address is [email protected]