This is not to say that there is nothing wrong with the obviously behest loans granted by the Erap-appointed officials of UCPB, the same ones who refused to leave after the fall of the Estrada administration. Obviously, there is something anomalous with granting sizeable loans guaranteed by collateral consisting of useless Cyberbay shares of stocks. The Bangko Sentral should investigate and the proper punishments meted out.
As of now, however, I am told that the accounts have not turned sour. Cojuangco and Ang are supposedly still servicing these accounts and we have to give them the benefit of the doubt that they will continue to do so, even after Cyberbay has become a total loss with the promulgation of a recent Supreme Court decision on the Amari reclamation project.
What is worrisome about the revelation is that Danding and his most powerful henchman got a behest loan through the courtesy of other loyal henchmen at UCPB and Danding isn’t even President yet. It is a bad preview of what to expect in a Danding administration – the return of Marcos-style crony capitalism.
For now, however, saving a bank as important as UCPB is obviously in the national interest. I do not think we can afford a serious blow to our economy‘s credibility if this government-managed bank goes under. But inasmuch as they are now using the people‘s money through the PDIC, it is important we find out why this mess came about. We have to go beyond the Danding-Ramon Ang loans. There will be other lessons that must be learned, very expensive lessons.
The investigation should tackle the period from 1986 to the present. From what I have been told, what happened to UCPB is almost a carbon copy of what happened to PNB. Both suffered serious setbacks because of the large amounts of soured behest loans during the Ramos administration. In fairness to FVR, who has command responsibility over his appointees, the air must be cleared once and for all.
I am not even sure that the Bangko Sentral is the proper agency to do the investigation. In a sense, the Bangko Sentral shares part of the blame for the mess because as the regulator, it failed to stop the crisis in both PNB and UCPB from happening. There may be too much familiarity between regulator and regulated going on. It is in the interest of the BSP bureaucrats to cover their collective asses by clearing the guilty parties.
This is one time when an honest-to-goodness investigation by the Senate’s banking committee is in order. Or maybe the Ombudsman should get into the act as well. Our money as taxpayers and the health of the economy are at stake. We should get good and honest answers as soon as possible.
I am afraid putting new taxes on the telecoms sector just because the sector is performing better than the rest of the economy may kill the goose laying the golden eggs. The good performance of the telecoms sector has boosted the performance of the services sector in general and contributed to the better than expected GDP numbers in the past couple of years.
I don’t think demand for telecoms services is that inelastic, no matter the text messaging craze sweeping our youth. Once the costs cross some critical point because of the new taxes, it is entirely possible that demand will fall. That means, government won‘t collect that much taxes after all. Worse, it would have caused enough damage to an industry and discourage prospective investors in other industries from risking their resources in this country. That’s institutional uncertainty.
Indexing taxes to inflation may promise to solve government‘s cash problems but would most certainly aggravate inflation. Imagine taxes going up in tandem with prices, giving the consumer a double whammy every time. There is such a thing as cost-push inflation and for products like petroleum, an essential commodity whose demand is to some extent inelastic, the ripple effect on all other products and services can push the cost of living to an unbearable level.
Hopefully, Mr. Camacho cannot just impose these new taxes on his own by administrative fiat. Tax measures such as these must require an act of Congress. And with an election just up ahead, it is unlikely that Congress would pass tax measures that are highly unpopular to the mass base of our people. That being the case, Lito may just as well shut up. There is no sense unduly alarming the business sector and the consumers. It just reduces confidence in our government and our economy.
I was looking at the program and a lot of the papers are stuff ordinary mortals like us won‘t understand. However, some of the topics are pretty down to earth, with obvious benefits in our day-to-day life. There is something on sustainable forest management by a Pinoy PhD from the University of Illinois. There’s one too about traffic management system to reduce congestion in Metro Manila by a Pinoy PhD from Minnesota.
Another interesting paper is on flood control and management in the Metro Manila region by a Pinoy PhD from UP Diliman. And there is also a paper on renewable energy in developing countries based on the World Bank experience by a Pinoy PhD who started it all here before he went abroad. Finally, there is a model simulation of air pollution over Metro Manila.
The challenge is how to use science and technology to improve our economy and our lives. Mar Roxas is scheduled to address the conference. Hopefully, Mar comes up with some idea of how to make use of Pinoy technical power to jumpstart our country’s economic growth.
A guy walked into the doctor’s office for an appointment.
"Would you like to tell me your problem?" the pretty receptionist asked. "I’ll need the information for the doctor."
"It’s rather embarrassing," the guy stammered. "You see, I have a very large and almost constant erection."
"Well, the doctor is very busy today," the receptionist cooed, "but maybe I can squeeze you in."
Boo Chanco’s e-mail address is bchanco@bayantel.com.ph