Where change must come

It’s an underwhelming use of strongman powers for President Duterte to go after mere “tambays.” The President has called his centurions to accomplish a cosmetic purpose: beautify the streets by removing vestiges of unemployment and features of poverty.

If the President cannot restrain his authoritarian tendencies, there are two age-old economic obstacles against which he can put to good use his high-handed ways. If the President removes the stumbling blocks to prosperity, he will clear the streets of tambays without the need for policemen to perform street cosmetology.

The two economic obstacles that have been padding the numbers of our poor are: (1) the usurious cost of loans to farmers and small entrepreneurs, and (2) the syndicated lowering of crop prices during harvest time.

Millions of our small entrepreneurs live hand-to-mouth because they are forever crippled by usurious loans. Millions of our farmers are dirt-poor because they suffer from the double whammy of usurious lending costs (of capital and farm inputs), and the syndicated lowering of crop prices during harvest time.

The antiquated problem of extortionate loans is a colossal obstacle that has never been solved by past presidents. If the President wants to achieve genuine change, he must work to lower the cost of capital and make it accessible to farmers and micro entrepreneurs.

We have seen from past administrations that giving hefty incentives to businesses and increasing government spending, as means to create jobs, are not enough to reduce our atrocious levels of unemployment and poverty. Programs like the “Build, Build, Build” project of the current administration will create more wealth for the already wealthy. But for the poor, it will merely result in more contractual jobs that pay minimum wage, jobs that will not be enough to lift them out of poverty.

The real game-changer will happen if the government shifts from the mindset of creating laborers out of our workforce, to an outlook of producing more entrepreneurs from its ranks. By enabling them to become entrepreneurs, they can have better chances of earning income that’s above subsistence wage.

To be fair, the Department of Trade and Industry and the Department of Agrarian Reform have funds available for loans to micro entrepreneurs and agrarian reform beneficiaries. President Duterte should make these propoor loan programs a major centerpiece of his economic agenda, and give it equal stature as his probusiness “Build, Build, Build” flagship project.

The President should allocate more funds for micro loans, and give marching orders for his officials to study how countries like Thailand were able to spur the growth of an army of small entrepreneurs, and how local organizations like the Center for Community Transformation can achieve a 98-percent repayment rate on its micro loans to street people.

The President can harness his strongman tendencies by punishing syndicates that artificially inflate the cost of farm inputs and deflate the prices of harvested crops.

Drive around our crop-producing regions and see the glaring testaments to the syndicated conduct in our agriculture industry. You see the massive warehouses, gigantic storage silos, fleets of trucks and other proof of immense wealth among grain traders. In contrast, you see downright destitution among our farmers.

Our country has always been importing rice; this means we have a recurring shortage of domestic supply that fails to satisfy demand. With a perennial supply shortage, the law of supply and demand dictates that our farmers should earn enough to stave away a starving existence. But why are domestic rice crop prices perennially at low levels that shackle our farmers to grinding poverty?

Change is not coming if all that the President has in mind is to arrest shirtless men who loiter in the streets. Change will come if the President trains his wrath on wayward elements of society who are responsible for the shirtless people loitering in our streets.

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