A tax collector for finance chief

Now that Ate Glo has started work on her inaugural gown, I hope she has also started to think of what she should do to address the national crisis at hand after she is sworn into office. I remember writing that perhaps it would be divine justice if Ate Glo won the elections because she will have to suffer the consequences of her folly during the last three years of her watch.

Divine justice indeed and not just for Ate Glo but for the Pinoy electorate who must now suffer the consequences of their collective choice. I also wondered in the weeks before the elections if Ate Glo will be less of the populist, politics first kind of President after she is elected to a brand new six-year term without re-election. This is something we have yet to find out.

Without any doubt, the most important problem Ate Glo will face in the first hour of her new term will be the fiscal deficit problem. With Napocor expecting a cash deficit of at least P100 billion, there is absolutely very little wiggle room for Ate Glo. National Government itself will probably be in deficit for close to P200 billion again, despite claims of the administration’s money managers that they are on track in reducing that number.

Just last week, BizNews, a business weekly published by newsman Lito Gagni reported that government is resorting to delaying payments to contractors to make it seem that the budget deficit is within target in the first half. According to BizNews, analysts blame excessive election-related spending for the increase in the budget deficit.

"The budget deficit rose 20 percent in April from a year earlier despite revenues rising in the month by P10 billion from a year earlier to P75.85 billion. Spending for the month overshot the P83.68-billion target by P11.3 billion to result in a budget deficit in April of P7.8 billion." The Department of Public Works, according to the BizNews report, admitted to some P3 billion in arrears to contractors for projects from March to May alone.

The government is targeting a deficit of P79.6 billion in the first half and this year’s shortfall to below P197.8 billion. It is generally agreed that the goal of a balanced budget by 2009 is tough to reach without significant cuts in expenditures and improved tax collection. No one measure can be considered a silver bullet that can address the fiscal deficit problem. Ate Glo must implement a combination of measures to keep the National Treasury above water.

First on her agenda, the way I see it, is the appointment of an experienced tax collector as the new Finance Secretary. She cannot just move Vince Perez from Energy to Finance the way she moved Lito Camacho there. Vince is like Lito, a New York banker type and would probably be more inclined to borrow some more as a response to the problem.

I think we need someone more like Willy Parayno, a homegrown revenue collector with experience in both the BIR and the Customs bureau. If Ate Glo can convince Willy to take the assignment, that would be great. Otherwise, she will have to look for someone like Willy. We need a tax collector who knows how to generate revenues, not a banker who will just borrow. Ka Roger, perhaps?

Second on Ate Glo’s agenda is a pretty drastic measure that would test her commitment to reforms even at the expense of popularity and political expediency. She must move to drastically cut the bureaucracy. Civil Service Commissioner Karina David has hinted on the inevitability of this measure and for good reason. Not only will we get more efficiency from a smaller bureaucracy, the amount of money we have to set aside for salaries and related expenses will also be cut significantly.

I understand that we spend P276 billion a year on salaries of the bureaucracy. A 10-percent cut would save us P27 billion. Think of the related savings in terms of reduced office space, reduced utilities cost, reduced office supplies cost and reduced benefits and the numbers add up.

I am told that we need to raise at least P50 billion in new revenues just to be able to breathe a little more freely. If we save P30 billion by reducing bureaucracy, we are more than halfway there. A peso saved is a peso earned, given the difficulty of raising new revenues.

But that is going to be a tough test for Ate Glo. How can she be expected to cut the bureaucracy when she precisely used government employment as a means to gain votes during the last election? As an economist and a responsible official, she knows she must put an end to this notion that government has the obligation to be the employer of last resort.

But how could she do that when she is an avid practitioner of the concept? The so-called emergency employment scheme which her father also used, is obviously not the most efficient way of spending our tax pesos. But it was politically useful for her. She does not have the moral high ground for reforming the bureaucracy.

It would be interesting to watch how Ate Glo approaches this fiscal deficit problem and I don’t mean postponing the payment of bills. She has some tough decisions to make. Let us see if her electoral mandate would transform her into a President good enough to be remembered well by history.

Delusions

I suppose every serious candidate has to truly believe he is capable of winning, which explains why Brother Eddie Villanueva still refuses to concede defeat. Actually, when I asked another former born again preacher about Brother Eddie’s candidacy during the heat of the campaign, he said Brother Eddie’s delusional if he thinks he can win.

Of course Brother Eddie was able to produce respectable crowds every time he held a rally. But producing warm bodies for political rallies and delivering the votes are two different things. As it turns out, Brother Eddie‘s "times seven" mathematics proved to be seriously flawed. And he did seem delusional on the ability of his religious organization to deliver the votes, not just for him but for CIBAC, his party list group.

As it turned out, CIBAC only managed to get enough votes for one seat, that’s one less than they have now. Only about half a million voted for CIBAC. If Brother Eddie had command of all those supposed millions, CIBAC should have topped the 1.2 million of topnotcher Bayan Muna and have three seats. How difficult would it be for those voting for Brother Eddie to vote CIBAC and thereby re-elect Brother Eddie’s son?

The Iglesia Ni Cristo-supported partylist group, Alagad, also did poorly with just 340,000 votes or just one seat. Yet, the supposed solid vote of the Iglesia ni Cristo is much sought after during elections. Yun pala, they couldn’t even get a million votes. Buti pa yung Buhay party list group of El Shaddai that won two seats with their 700,000 votes.

Maybe, the good news is, the members of these religious groups made a clear distinction between their faith and the exercise of their political rights. Maybe they are not about to allow their leaders to dictate who they should vote. Maybe the endorsements of these groups are not that important except in an extra close contest.

It was a mistake for Brother Eddie to mix politics and religion and shamelessly use his religious organization to back up his political ambitions. He should have been familiar with the response of Our Lord Jesus Christ when the Jews wanted Jesus to take a political role and lead them. Jesus refused, insisting such was not his role. His Kingdom, He said, is not of this world.

And when asked about politics and taxes, our Lord asked for a coin and then asked whose profile is on the coin. His lesson: Give to Ceasar what is Ceasar’s and to God what is God’s. The Lord made a very clear distinction that couldn’t be missed about Church and State. His Kingdom is indeed, not of this world.

No wonder Brother Eddie lost. But obviously lacking humility, he has yet to accept it. His lawyer is still contributing to the delay in the canvassing in Congress. He could have set a good example to our professional politicians.

Definition

Now, here’s Dr. Ernie E.

A man was assigned a new post teaching English to prison inmates. Not knowing the level of education the prisoners had, he decided to begin his first class by asking a basic question: "Okay, who can tell me what a sentence is?"

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