Friday, August 28, 2009

Living On Borrowed Money

GMA News.TV on 8/26/09 reported that President Arroyo submitted to the House of Representatives a budget for P1.54 trillion. This means more jobs, more roads, more school buildings, more, more, more. But the question is, From where will the funding come?

If, while on a crossroads, my wife and I did not agree to cut up all our credit cards, we would never have enjoyed a save-first-spend-later life style. The Bible tells us that the borrower is servant to the lender. I do not want to be a slave to anyone, do you?

One foolish thing I found out to be true while living on borrowed money was the more I borrowed the more I spent on things I never needed. My wife and I spent a lot of our hard earned money on useless things.

Maybe former Senator Ralph Recto is right. It's time for zero-based budgeting. Although it is indeed very cumbersome, maybe it is time to justify every allocation included in a proposed budget. Otherwise, this borrow-more-spend-even-more cycle is never going to end. This culture is going to push even more of our people into virtual economic slavery.

I wonder how much of the 1.54 trillion 2010 budget that President Arroyo submitted to Congress is fat. My guess would be a lot. If you do not believe me, all you have to do is walk around any government agency and see how many employees are doing nothing but push their pens. The government bureaucracy in our country is so inefficient. Just try to get an NBI clearance. You inch your way toward a window for three hours only to be told to return in ten days after a same name verification is done, which was done a year ago, and the year before that.

But, I think fiscal waste due to bureaucratic inefficiency is nothing compared to the awarding of government contracts. One has to wonder, How much of the P235 billion earmarked for education and manpower is allotted for the "awarding ceremony?" You know what I mean. The same goes for the P72 billion for roads and bridges, P5.8 billion on new school buildings, P27.6 billion for farm infrastructure and so on down the line.

Is there really something wrong with the system, or is the system's operator the one at fault? Or maybe both need to be replaced. There is only one way to find out: Zero-based budgeting. The process may cost a lot at the front-end in terms of time, talent and treasure but the benefits will last for a very long time.

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