OFFLINE: Reviving a bad idea
Just when we thought that one of the worst ideas of the current administration had been abandoned for good.
Ferdinand Marcos Jr. finally admitted this week what many had suspected all along. He is 100 percent behind the bill creating the so-called Maharlika Wealth Fund, or whatever it is they’re calling it now.
For a while, the idea seemed to have died a natural death. A number of senators had, after all, said that they were not fully supportive of the plan. Among other arguments, the anti-Maharlika senators said the time was not right, and besides why the apparent rush to create yet another fund?
There was a popular uproar over the initial bill coming from the House. The initial funding would have come from government-controlled corporations along with the Bangko Sentral. Then there was the idiotic proposal to have the president of the Philippines not only sit on the board, but to head it.
It was not meant to mean the current president, but every future president, the proponents said.
The Maharlika plan was, from the very beginning, fully supported by the current president, whose knowledge in economic and financial matters is as close to zero as can be imagined.
Fact is, the very name of the fund – Maharlika – has always been identified with the president’s father and namesake, the late dictator who even wanted to rename the Republic of the Philippines to Maharlika Republic.
The elder Marcos supposedly led a guerilla group named Maharlika during World War ll. It was his source of some of his fake medals, but he created his own legend through the use of fake news even back then.
The incumbent president has said that he ran to clear the Marcos name. So this is one way of doing it, by creating a sovereign fund when experts have stated that the Philippines simply does not have the funds nor the steady earnings to create such a fund.
To make a long story short, proponents – including a few still-respected lawmakers who should know better – want to take funds from various government-owned and controlled corporations to create the fund.
This itself makes little sense. Why get funds from, say, the Social Security System or the Pag-IBIG Fund, for example, when those organizations are already self-sufficient and operating profitably sans too much government interference.
It has also been pointed out that other countries with their own sovereign funds are so much bigger than the Philippines, which remains a developing country. Or Third World, if you will.
Only developed nations can properly handle sovereign funds. And even then, there’s no way of guaranteeing that it cannot fail.
There’s another reason why the foolhardy Maharlika fund cannot work aside from the fact that the country is not exactly swimming in excess cash.
For the fund to succeed, it will require the best and brightest economic minds to handle it without government interference.
This will not be the case. A lot of the members of the proposed board to handle the fund are from the government sector, or will be government appointees from the private sector. Another name for them is cronies.
The president of the Philippines may no longer be included as board member, but the Finance secretary will be there.
To be perfectly honest, the country’s current Finance secretary is not exactly a paragon of competence and/or honesty. Suffice it to say that in my book, he cares more for himself and his bank account than the country he is supposed to serve.
I am not singling him out either. Too many Cabinet secretaries of the present and past regime were most unimpressive. They were bureaucrats, at best, and incompetent crooks, at worst, which is why the Philippine economy has never really taken off.
It did in the Ramos and Aquino administrations, but both are long past.
Allow me to simplify the Maharlika fund in the simplest terms possible. At least simple enough for even a college dropout of a president might understand.
Say your family lives in a house. You have money in your wallet, as does your wife/husband. Your kids have their respective alkansyas AKA piggy banks. All of you have GCash or whatever e-wallet you prefer.
Your total family income plus current accumulated wealth amounts to X pesos.
Now what happens if you put some of the cash in your wallet to your wife’s GCash, and add all the coins in one of more piggy banks.
Will your family’s wealth increase tenfold? No? How about fivefold? No, also. Will it even double, at least? No, no, no.
All you’re doing is combining the money you currently have, but not making it grow. It’s a zero sum addition, iznit?
This is similar to what the proponents of Maharlika are planning on doing.
They are saying that in pooling together already existing funds, it can be invested in bigger projects resulting in bigger earnings.
Not so. The government – not just this government, mind you – has never been known for executing brilliant ideas that result in mega earnings for the country. This is why the Phililippine economy has had countless fits and starts, or a cycle of boom and bust, if you will.
Now does anybody believe that the regime of this current chief executive is so much better than past administrations?
I submit that it is not.
The forementioned Ramos and Aquino2 regimes were pretty good, thank you. And the proof is in the record books. FVR not only reversed the ultra-serious power problems that country was having, he picked good men and women to lead the country’s economy to tiger cub status.
The president named Noynoy did even better, turning the Philippines into one of the fastest growing economies in the world, attaining tiger economy status in the process.
If a wealth fund was such a great idea, why didn’t the bright boys and girls of the two administrations tell FVR or Noynoy to create such a fund pronto?
It is, in other words, a fund whose time has not yet come for the Republic of the Philippines. If ever.
My biggest fear is that it will be yet another source of funds for the most corrupt people at the top to treat as their personal alkansya.
Sadly, it may yet be approved by the bicameral Congress in the coming months because the country has run out of honest leaders who have a vision for its future.