Wealth fund should come from wealth tax
Pera naming mga manggagawa yan, bakit kayo ang nag-uusap?
Sovereign Wealth Funds (SWFs) are essentially profit-driven state-owned investment funds. Some of our neighboring countries who want to make the most out of their surplus—usually foreign exchange generated from exports—established state-owned entities to invest their excess capital on various instruments. Singapore, Indonesia, Malaysia, among others, created their own SWFs.
With the potential of SWFs to grow, they can distort incentives in an economy where they are invested enough to favor specific economic activities and enterprises. Although SWFs usually invest in foreign instruments, there is nothing stopping them from pouring investments on profitable economic activities and enterprises at home, thus, making SWFs a strategic tool for industrial policy. But this is not necessarily the motivation for the proposed Maharlika Wealth Fund.
Now, should workers support the government’s attempt to create an SWF?
That public pension funds are identified as sources of financing for the SWF already earns the proposed fund minus points. Public pension funds are fragile. There is a reason both SSS and GSIS are very careful in their investment decisions and that is because that is how they secure future generations of Filipinos. GSIS should know the risks involved especially in foreign money market, after all, their exposure to the 2007-2008 Global Financial Crisis may have costed the pension fund some of its resources.
Can politicians pushing for SWF guarantee the security of workers’ retirement funds while exposing it to potential losses from profit-driven, speculative investment decisions? House representatives who back the SWF argue that pension funds are guaranteed by government funds anyway, and that the SWF will come with sufficient safeguard measures.
But NAGKAISA has a better idea to secure workers’ pensions, and that is by not exposing them to unnecessary risks. If SWF should be pursued, it must be funded by true surpluses generated by the economy—the proceeds from wealth tax!
In 2020, NAGKAISA floated the idea of taxing the unused assets of the wealthiest in the country. The tax revenue from the wealth tax could have funded pandemic recovery measures of the government. Now that the Philippines is gradually recovering, potential revenues from wealth tax can now be used to fund ideas such as SWF without risking workers’ funds.
And what is this obsession about the term “Maharlika”? If the proponents want to connect SWF to a concept from Philippine history, then they should have kept in mind that the Philippine government does not have a good record in managing public funds. That fact is also historical. Unless the proponents have concrete plans about protecting the SWF from turning into a Maharlika Wealth Scam, House Bill 6398 cannot just be allowed to pass. In any case, workers remain critical of this proposal especially when their pensions are on the line.
Let us unite against the return of a dead dictator and a new tyrant!
Labor Education and Research Network (LEARN) 2022 Labor Day Statement
In a few days, Filipino voters will have the once-in-a-six-years chance to choose a new president. The next chief executive should have a clear and doable plan how to arrest the soaring prices of food and other necessities induced by the covid pandemic and the global oil crisis, stem the erosion of the workers’ already low wages, and halt the farmers’ sustained income losses, while ensuring that taxes and government resources are not lost to corruption.
President Rodrigo Duterte is about to end his term—leaving a dismal legacy: six years of broken promises to stump endo, failure to stop Chinese incursions in the resource-rich West Philippine Sea, and the botched drug war that killed thousands of suspected drug users.
Duterte wants to survive through his daughter Sara, who is running as vice president to Ferdinand “Bong Bong” Marcos, Jr. The uneasy alliance was brokered by former president Gloria Macapagal-Arroyo, who allied with Duterte in the latter’s presidential bid in 2016. Within two months of Duterte’s term, Arroyo’s plunder case was dismissed by the Supreme Court who at that time was dominated by her appointees. The previous president’s appointed chief justice, Lourdes Sereno, was impeached in 2018. Later, the cabal was joined by Joseph Estrada, another ex-president who was pardoned by Arroyo only after two weeks of conviction for plunder.
So, who is it, really? Is it the Dutertes wanting to remain in power, or is it the Marcoses trying to regain Malacanang? Evidence says that it is more of the latter.
The Marcoses’ campaign to fully retake their stolen wealth and faked stature is no small feat. In 1998, twelve years after they were kicked-out of the country by a popular revolt in 1986, the family’s matriarch, Imelda, was allowed to return to the country to face charges of graft and corruption. In 2000, the family started to engage professional communicators in generating myths of the great wealth of the family, rather than a wealth extracted from half a century in politics. They started with Friendster, Flickr, and other platforms that were forerunners of Facebook and Tiktok. A few years after, Imelda and her children started to take elective positions in their home provinces of Ilocos Norte and Leyte.
https://twitter.com/rapplerdotcom/status/1514740708942528527?s=20&t=0wFraK7Yb9OG6JzMODsLwA
Ferdinand Marcos Sr’s spirit must be restless right now: will Filipinos welcome his family, or will they finally exorcise his ghost and embrace a future of hope?
The critical role of the workers in determining the best tract for the country is once again at the forefront. It was the workers and progressive individuals and groups from across social classes and sectors who resisted US colonialism in the early 1900s, valiantly fought the Japanese occupation during WWII together with the farmers, and made up the core of resistance against martial law leading to the 1986 Edsa Revolution. In war and peace, the workers’ interest for continued social progress runs counter to the interests of the status quo, hence they are almost always targeted first by tyrannical rulers.
The vote of the workers, women and men, especially those organized, could truly put forward the genuine interest of Filipinos—a thriving local economy, taxation that works for the people and not as a subsidy for the filthy rich, industries that create wealth and employment without destroying the environment, and a society that caters to the needs of all, especially the vulnerable sectors.
For the May 9 election, the platforms and track records of Leni Robredo and Kiko Pangilinan are our best shot. There is no illusion that all the social ills will be resolved in the six-year term of Robredo. But we will have the chance to co-create a better long-term plan, as shown by her willingness to sign covenants with different sectors, and her active participation in public debates. Her long practice in developmental lawyering—working with the farmers and workers rather than serving the more profitable corporate and tax law practice, shows that her heart is in the right place.
A Marcos-Duterte tandem on the other hand will only plunge us deeper down the rabbit hole.
On International Workers’ Memorial Day, LEARN calls for safe and healthy workplaces for workers
LEARN Statement for International Workers’ Memorial Day 2022
LEARN joins the global labor movement in commemorating the International Workers’ Memorial Day today, April 28. Organized globally since 1996, its purpose is to honor the memory of victims of occupational accidents and diseases by organizing mobilizations and awareness campaigns on this date.
Just as the official count of Filipinos who died from COVID-19 passed the 60,000 mark, many of whom were working people, the call to understand more deeply the occupational health aspect of any work or livelihood, has never been more urgent.
Even before the pandemic, workers all over the world have already been putting their lives on the line to perform and deliver essential services. According to joint estimates from the World Health Organization (WHO) and the International Labour Organization (ILO), 1.9 million people died from work-related diseases and injuries each year.
When the deadly virus hit the Philippines in early 2020, workers from across industries had to continue doing their jobs in poor working conditions. Official counts from the Department of Health (DOH) confirmed that at least 104 health workers died while on the frontlines in the battle against COVID.
https://twitter.com/ituc/status/1511980452747304967?s=20&t=mht9reUZs9eIAVpGl8c5Gw
The pandemic exposed not only the ongoing workplace safety crisis but also the dismal state of economic security and social protection mechanisms for those in the labor force.
Two years since the March 2020 shutdown that decimated the labor market, the Philippine government still has not figured out how to bring back the employment situation to pre-pandemic levels. Unemployment rate for February 2022 was at 6.4 percent, still a far-cry from the 5.3 percent recorded in January 2020.
Last year, the Department of Labor and Employment (DOLE) declared COVID-19 as a compensable work-related disease. However, the granting of paid isolation and quarantine leave benefits to workers remains optional.
LEARN urges the Philippine government to take occupational safety and health standards more seriously in fighting COVID.
On the International Workers’ Memorial Day 2022, LEARN calls on:
- The ILO to deliver on its promise during its Centenary Conference in 2019 to make occupational safety and health a fundamental right at work
- The Philippine government to strengthen the implementation of Republic Act 11058 (Occupational Safety and Health Standards Law) and to ratify the International Labour Organization’s Occupational Safety and Health Convention (C155)
- The next administration to create programs and policies for social and economic recovery that prioritizes the safety and welfare of workers and working families including support for workplace unionization campaigns and collective bargaining, the implementation of a wealth tax, and ramped-up vaccination efforts
Sources:
https://covid19.who.int/region/wpro/country/ph
https://newsinfo.inquirer.net/1488095/104-health-workers-die-of-covid-19-doh-data
https://psa.gov.ph/content/unemployment-rate-february-2022-estimated-64-percent
https://www.dole.gov.ph/news/covid-19-now-a-compensable-work-related-disease-bello/