Passion For Reason
After Meralco, who’s safe from gov’t bullying?
By Raul Pangalangan
Philippine Daily Inquirer
First Posted 21:59:00 05/22/2008
Filed Under: Government, Politics, Energy
MALACAÑANG SEEMS TO HAVE CONCLUDED that the only way to have cheap power is through cheaper politics. This is not the first time that a legitimate public grievance is whetted and diverted for partisan political profit. The most infamous was at Edsa II, when public outrage over the jueteng scandal and the suppression of evidence at the Senate impeachment trial led to the enthronement of a kleptocratic mafia whose greed is unprecedented in Philippine history.
Today the public demand for affordable electricity has been harnessed for political vendetta in a family feud between the Macapagal political gang and the Lopez commercial empire. If you believe that siding with Arroyo will dramatically bring down power rates, then you must also believe that Edsa II actually stopped jueteng, put an end to the suppression of the truth before the Senate, and upheld the principle of transparency and public accountability. You must be a fool several times over.
A few months ago, the government was able to make the Ayalas abide the PNP version of the Glorietta bombing, while dangling over their necks the filing of criminal charges. No, there was no bomb explosion; it was caused by toilet vapor! There were no terrorists hearkening Bin Laden’s call to arms, only shopaholics answering the call of nature. If they could make the Ayalas listen while they foisted that cockamamie explanation upon the public, why stop there? Surely, the schoolyard bully and her alalays can gang up on the next victim.
But the assault on the Lopez empire is a masterstroke of political one-upmanship. It deploys against the Lopezes the most formidable weapon in the Lopezes’ own arsenal: the media and public opinion. The Lopez family owns the largest broadcasting network in the country, cutting across television, radio, cable—and even telecommunications. Malacañang, by picking up a visceral issue so close to the hearts—and pockets—of the Filipino everyman, has taken on the Lopezes on home ground.
We all want cheap electricity. Meralco shouldn’t pass on to the consumer the entire cost of the most notorious form of “systems losses,” namely, the pilferage of electricity. The pass-on will remove any incentive for Meralco to stop the thieves. After all, why improve the policing of users when the innocent public will bear the cost anyway? It punishes the innocent, rewards the guilty, and absolves the irresponsible.
Meralco should pass on only those “systems losses” arising from energy lost in the natural course of transmitting electricity through the lines and transformers. It can pass on certain administrative expenses, including community services that are anyway required by law. There are other natural costs of doing business. One such cost is the monthly electric bill that Meralco itself consumes. That is why it perplexes me why it has become such a big issue that Meralco offsets its electric bill against its own. I don’t know how much it will benefit me as a consumer if Meralco charges itself the open market prices and pays that amount back to its own cashiers.
Indeed, I checked Meralco’s website—it’s not reader-friendly, I warn you. It looks like it was authored by either a lawyer, an economist or an engineer, the last guys you should consult if you want to talk to real human beings. Only 20 percent of your monthly Meralco bill goes to Meralco; the other 80 percent goes to the power supplier, the transmission company and the government.
We musn’t lose sight of possible savings in that other 80 percent. The power is sourced through, among others, the government’s own natural gas desposits off Palawan, which is indigenous (not imported) and clean (not polluting). Yet the government has imposed heavy taxes on natural gas production and, worse, has pegged its price, not to the actual cost of extraction and development, but to the market price of crude oil, its comparator product which is imported and polluting.
Finally, the government continues to impose Value-Added Taxes on “systems losses,” contrary to the letter and spirit of the VAT law, since a loss obviously adds no value to a product. These sensible measures will push down the cost of electricity without the firing of the heavily political artillery in the halls of Congress, and they are completely within the power of the president.
The orchestrated assault on Meralco sends all the wrong messages. To the business community, it says: Do not cross me. I do not only get mad, I get even. Woe unto you who incurs Gloria Macapagal-Arroyo’s wrath. (And if you are my friend, don’t you worry. We’ll break up Meralco’s franchise, and we’ll give you your share.)
To the media networks: Control your reporters and your editors. We know your weaknesses. We will hit you where it hurts. We can sic the Bureau of Internal Revenue to audit your tax books. We can sic the Department of Justice to sue the pants off you. Or, if by chance non-uniformed men with machineguns hover in your neighborhood aboard motorcycles, don’t even think of calling the police. But, again, we take care of our friends. If a criminal complaint is filed against you, it will be dropped. If charged, you will be acquitted. If convicted, you will be pardoned.
To the World Bank and foreign lenders: Don’t take us seriously when we speak of privatization. We sell public assets only to jack up our disposable cash, but we buy private assets in order to spite their owners. In the 1950s, they used to call this “creeping nationalization” because governments would confiscate slowly and by stealth. Today we should still call it that, but only because we are certified creeps—and we don’t care. Why, how many battalions do you have in your pocket?
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