Signs of stability in US economy?

Comes the time when bad news is not news anymore. People get to the point when nothing surprises them. And if I am typical, I have even come to convince myself that maybe I shouldn’t care if the 6th or whatever cut in interest rates by Alan Greenspan and the Fed Governors made a ripple at all. News reports from Washington make it sound like the US Fed is in some kind of a deathwatch over the US economy.

So I made an extra effort to look for hints of good times ahead. That’s the journalistic equivalent of heavy lifting and I did find some bits of good news over the weekend. "Those who think a soft landing is still possible got some good economic news this week," ABC News reports. "The Conference Board reported Tuesday that consumer expectations improved this month."

The New York Times however, reports that Warnaco, the maker of Calvin Klein jeans and Speedo sports clothes filed for bankruptcy. Bad news for our garments exporters. But this was balanced by ABC News, as it reported: "Home sales and durable good orders were also somewhat stronger than expected, suggesting that the Fed’s rate cuts are having their desired effect."

Improved consumer confidence is the definite good news since any further erosion may cause consumers to stop spending as a form of knee jerk herd reaction. It was just consumer spending that kept America from falling over to recession over the past months. Accounting for roughly two-thirds of all economic activity in the US, consumer spending is terribly important for the US economy.

Also in the good news category, claims for unemployment benefits in the US fell for the third week in a row, suggesting that the outlook for jobs has improved. That must have been why consumer confidence is apparently bottoming out. The Washington Post however warns "it could take as much as two years for economic growth to regain enough strength to move back in line with its maximum sustainable pace…"

In other words for the Philippines, it is still neither here nor there. The good news is the US economy on which we are so dependent for our principal exports, may not end up in recession. The bad news is, it had been battered sufficiently to cause us problems in the next couple of years or so.

I have also heard reports that the hard hit tech sector is now in the process of sending home some of the workers they imported during the era of high growth. The nurses, rather than the netheads, are the more employable of our manpower exports these days.

In the meantime, I think we are on the right track in trying to sell our ability to service back office requirements of American firms. DTI Usec Toby Monsod was on ANC one evening last week discussing this strategy. The good news with this approach is that we keep our trained people gainfully employed here. With more training and exposure to what it takes to run back office operations, we get the opportunity to move on to higher value services in the future.

GOCC pay scales

It was really shocking to learn that the chairman of the sweepstakes office gets as much as P10 million a month in pay and so-called confidential funds. It is just right that President Arroyo issued orders to rationalize pay scales and job perks of GOCC executives.

But I think it will be a mistake to limit the compensation package for positions of Landbank president and the investment officers of the pension funds. These are positions with clearly competitive counterparts in the private sector. Even if Gary Teves is willing to get a pay cut, as a principle, it may be counterproductive if government ends up with less than qualified people in those positions. Better yet, privatize all corporations that are directly competitive with the private sector.

The sweepstakes case is clearly an abuse. But the pay scales for the Bangko Sentral and the Monetary Board are well within reason, given their responsibilities. I don’t think they should be simplistic on this matter of pay scales. The compensation package should be competitive with comparable private sector jobs so that the job can attract the best qualified professionals.

It does not make sense to be stingy with compensation only to find out that they are augmenting their official take home package with under the table extras.

Open spaces

I was mistaken when I wrote that Mayor Mel Mathay sold the open space in Greenmeadows 3 to a religious school. Apparently, he gave it for free. I guess this makes the case something the Ombudsman should look at because it is a deal that is clearly and grossly disadvantageous to the government and the citizenry. Why should a private school that charges outrageous tuition fees get free access to public land?

Speaking of open spaces, what is this rumor I heard that DND Secretary Angelo Reyes is thinking of closing down the golf course around Veterans Memorial Hospital and selling or leasing the property to a mall developer? That is terrible. I am not a golfer but those golf courses around this crowded city of ours serve even non golfers like me. That greenery and open space is essential to healthy and more bearable urban living.

Besides, the last thing we need in that area is another mall.

The good news in all these is that DENR Secretary Sonny Alvarez has taken the fight for greenery and open space as his own. I understand he has ordered a stop to the destruction of Mehan Gardens. He should also look into the Greenmeadows and Veterans Memorial cases. I am sure DENR can stop these projects for failure to comply with environmental rules.

For one thing, they should have proper density ratios in any urban development. They cannot propose to pack people like sardines and get away with it. If local governments are hopeless in this matter, we are lucky to have someone like Sonny Alvarez at DENR to do what is right.

Waste of time

And now… here’s Dr. Ernie E.

"The thrill is gone from my marriage," Alan told his friend Don.

"Why not add some intrigue to your life and have an affair?" Don suggested

"But what If my wife finds out?"

"Heck, this is the new millennium, Alan. Go ahead and tell her about it!"

So Alan went home and said, "Dear, I think an affair will bring us closer together."

"Forget it," said his wife. "I’ve tried that – it never worked."

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