Remember the bad old days of the first energy crisis in the late 70s? It seems like those days are back. The oil producing countries are in the driver's seat once more. Actually, it was worse the first time around because the world was a lot more dependent on oil. Since then, technology has moved on to make alternative energy more economically competitive and to improve our efficiency in using oil.
I suppose it is okay to bash the oil producers, mostly Middle Eastern Arabs, if only to release that build-up of tension and frustration over our seeming helplessness. But try viewing things from their perspective. Oil is mostly, their only natural resource of value. Oil is a resource that is subject to depletion. Once it is pumped out of the ground and used, that's it for all eternity... gone.
As such, if you were that Arab with the oil field, you wouldn't be in a hurry to use up your resource, specially if the price is not right. Keeping that oil in the ground is a better option. You might even look at it as an investment for the future. Besides, a liter of bottled water costs about as much if not more than a liter of refined premium gasoline. How do we explain that?
And what is the right price? Under the free market system, the right price is what the market will bear. Demand and supply rules. Right now, the world is consuming two million barrels a day more than the OPEC is producing. And the buoyant world economy is putting more pressure on the demand side. Of course the price will rise.
But then again, the Arab with the oil well must also think of the health of the world economy. Unlike on the late 70s, he is now heavily invested in Western banks and other enterprises. If the world economy sputters because of high prices, the non-oil investments of the Arab oil producers will also be seriously affected. That's probably why they are now thinking twice.
On our part, those of us who only consume oil products, we have to reduce the pressure on the demand side. I have no basis for this estimate but maybe, close to half of the gasoline and diesel we use for transportation is wasted on traffic jams and old inefficient engines, not to mention useless trips.
Surely, the escalation of oil product prices will call for drastic changes in our lifestyles. In the short-term, we just have to adjust and make some sacrifices, even if we can afford the higher costs. It is a civic duty to save on energy.
In the long term, the economic viability of alternative energy has been enhanced by this crisis. In a sense, OPEC did us a service. Cheap oil made it difficult for research and development efforts to proceed on alternative energy. In an economic sense and given that oil is a natural resource subject to depletion, its price should reflect its true economic value, one that will also encourage development of alternatives to its once the resource is all used up.
The one thing that is good about BIR Chief Dakila Fonacier is that he did not ask for the job. It is doubly good that he didn't want it when it was offered to him. And from the way he sounded during the breakfast forum at the Ristorante La Dolce Fontana last week, he seems ready to do a good job and even risk having his head chopped off if that's what it will take to also go after the cronies.
In other words, Daky is there to implement the Internal Revenue Code and meet his revenue targets. And if his superiors think he is doing it too well, if you know what I mean, he is ready to go. One gets a strong sense of mission and professionalism from Daky, probably because he was not named Dakila for nothing.
Daky also gave the impression he knows what he is up against. He has to worry not only about revenue targets but also about a bureaucracy that is not easy to run. Problems such as corruption are deeply ingrained in the system. But he still thinks he will be able to deliver, provided of course, the economy starts turning around the corner.
He will get the bureau computerized as soon as budgets allow. He also promised to make taxpaying a less traumatic experience for everyone. He said he would try to make things simple and minimize discretion on the part of examiners. But of course, he has to work within the limits of the existing laws.
Now, why did the tax genius, Sen. Juan Ponce Enrile remove SNITS in the CTRP? That is one system that is simple and gives revenue examiners little discretion. But then again, who are we to question the country's foremost tax expert? Even Daky had to say he only implements what laws Congress gives him.
Those PSE Governors must be really dense. They just don't get it. The stock market must now operate under a new and more demanding environment. The days of the "old boys club" in Binondo are over. Yet, they appoint an aging relic of those old days as chief operating officer of the exchange.
Titoy Pardo, Paeng Buenaventura and Mar Roxas should now read them, the riot act. If they don't clean up their act, the Erap administration should now let the SEC stop the trading until such time as those brokers learn their lesson. A few days of no trading is a small price to pay for a rebirth at the PSE.
If you think Erap is the only one having problems with those headlines, think again. Here is today's piece forwarded by reader Diana who used an infocom e-mail address.
A preacher wanted to raise money for his church, and being told there was a fortune in horse racing, he decided to purchase a horse and enter it in the races. However, at the local auction, the going price for horses was so high that the preacher settled on a donkey instead. The preacher figured, since he bought the animal, he might as well race. To his great surprise, the donkey did quite well and came in third place. The next day, the racing sheets carried this headline:
The preacher was so pleased with the donkey that he entered it in the races again, and this time the animal won first place. The paper said:
The Bishop was so upset with this kind of publicity that he ordered the preacher not to enter the donkey in any more races. The newspaper printed this headline:
This was too much for the Bishop and he ordered the preacher to get rid of the donkey. The preacher decided to give the animal to a nun in local convent. The next day, the headlines read:
The Bishop fainted. When he came around, he informed the nun that she would have to dispose of the donkey. The nun searched, finally finding a farmer willing to buy the animal for $10. The paper stated:
Nun Peddles Ass for Ten Bucks!
(Boo Chanco's e-mail address is boo@pinoycentral.com)