POSTSCRIPT / July 16, 1998 / Thursday

By FEDERICO D. PASCUAL JR.

Philippine STAR Columnist

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Erap’s headache: gov’t is bankrupt

THEN President Ramos had that rather unpresidential habit of combing his hair in public. For his part, President Estrada frequently fishes out a hanky and mops his sweating forehead while everybody watches.

Now it can be told: Mr. Ramos was preoccupied (worried?) not only with his thinning hair but also the dwindling finances of government in his last few months in office. As for Mr. Estrada, he has been sweating profusely because he inherited a government that is broke.

Mr. Estrada is having Godzilla-size headaches worrying where to get the billions needed to start delivering the jobs, food and security that he had promised the gullible masses.

No wonder Mr. Ramos wanted to install his own man in Malacañang. Somebody had to cover his tracks on his way out.

But a new, possibly antagonistic, administration has taken over – and the true financial condition of the government has been exposed.

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CONTRARY to the rosy picture that Mr. Ramos painted of the economy and the state of government finances, a P70-billion budget deficit is expected by yearend.

The country’s foreign debt has ballooned to $45 billion, but even that is peanuts compared to the P700-billion that the government owes local creditors.

Collections by the bureaus of customs and internal revenue, the two key earners of the government, have been below target. Tax evasion and under-the-table compromise deals are rampant.

The economy has been contracting, with some foreign investors pulling out, factories closing and the peso sinking to the P40:$1 level. Unemployed Filipinos are now officially listed at 4.3 million or 10 percent of the more than 42 million employable warm bodies.

Even those with jobs hardly feel secure, what with real wages falling and prices climbing with double-digit inflation.

The Ramos administration had gone on a selling frenzy, auctioning off valuable government assets at bargain prices, in a bid to raise money and dress up the income column of the government ledger.

On his way out, President Ramos even left P523 million in unliquidated cash advances pertaining to his office or offices directly under him.

It won’t be surprising if Mr. Estrada is having not only migraine but also even nightmares.

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WHAT will the brand-new President do aside from wiping his perspiration?

The standard measure when one is caught in a financial fix is to cut expenses and raise income. That’s what the Estrada administration will try to do.

The remaining half of this fiscal year’s P50-billion pork barrel will not be released to the salivating congressmen and senators. If the balance is still available, part of it will be diverted to priority projects that will generate more jobs and produce more food.

The 100-percent salary increases of officials will be suspended. The ambitious modernization plan for the armed forces will be held in abeyance.

The big cases of ill-gotten wealth that the government cannot hope to win anyway will be compromised. Tax amnesty (compromises) will also be granted delinquent taxpayers who don’t have cases filed against them.

If there are still valuable assets left, like the National Power Corp., these will be sold. Subsidies to foundering government-controlled corporations will be stopped and the firms closed if they cannot earn enough to maintain themselves.

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ONE thing that I think the country needs to arrest the scary drift is a shock treatment by a firm, resolute ruler.

The late President Marcos jolted the country in 1972 when he declared martial law, but while there was an initial semblance of national discipline and direction, things went awry when abuses crept in.

President Estrada does not have to impose emergency rule to whip the country into line. For starters, he can try catching a really big fish. He need not look far. There is the stinking PEA-Amari deal where billions reportedly changed hands to seal a lopsided contact.

I am thinking along the line of South Korea prosecuting, and eventually jailing, former top officials who had broken their solemn oaths of office.

Imagine indicting a former President, a Speaker, some honorable lawmakers and high-flying influence peddlers for big-time graft and even plunder….

That should strike fear into the black hearts of crooks in government and elsewhere.

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IN a country of 70 million, only Richard Gordon is competent enough to run the Subic Bay economic zone? That’s what I hear him and his rah-rah boys proclaim amid the roadblocks and barbed wire they had strung around their enclave.

If it’s figures they want, it can be shown that other economic zones, like the Calabarzon area, have attracted far more investments than Subic.

The life of the former US naval base actually revolves around the tested Gordon formula of rest and recreation — the lifeblood of his liberty town of Olongapo — backed by the natural allure of its mountains-by-the-bay setting.

Remove the duty-free (but still expensive) shopping and the weekend R&R, Subic Bay of Gordon is almost reduced to a ghost town.

Legally, Gordon has reason to stay on. But since it is clear that he cannot function properly without the trust and support of the President, what’s the point in clinging on to the mirage of an Eden in Subic?

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