Thursday, February 2, 2012

Milton Friedman - Four Ways to Spend Money



Here is a Milton Friedman valuable insight. Four ways to spend money:

1. Spend your own money for yourself
2. Spend your money for sombody else
3. Spend somebody else's money for yourself
4. Spend somebody else's money for somebody else

Of all these, what our government is very good at is the fourth way.

Anyway, let's begin with the first item. When you spend your own money for yourself, the tendency would be, which is true all the time, you want to have the best services and goods in

Did you ever care what this number represents? PhP4,898,340,000,000.00




That's our Philippine national debt! Clap! Clap! Clap! Both foreign and domestic combined.

As of October 2011 our Government National Debt is at a staggering PhP4,898,340,000,000.00 (P4,898.34 Billion or P4.898 Trillion). And with the current population of 95,000,000.00, every Filipino is unconsciously indebted PhP51,562.00!

They have no plans of lowering it. The Bankers own this country. The bigger the debt, the merrier for them. Strictly business folks. And I am not excited about it. In fact I am furious about it. Imagine, my kid who turns three on her next birthday, who knows nothing but to ask for lollipops and still pees in her pants sometimes has ALREADY owed the bankers and creditors PhP51,562.00 and COUNTING!

I have intelligent and handy plans how to erase the PhP51,562.00 per capita debt over my head:

1. To make the per capita debt to a very manageable level of PhP1.00 only, increase the current Philippine  population 52 thousand folds, that is by easy arithmetic of current population multiplied by current per capita debt (95 million X 51,562). getting couples to do the ultimate ultra active procreation activity is by way the easiest part. yeeppee! But not to mention possible genital sores every couple could get, feeding the new breed is the hardest thing though (shrugs).

2. Have my things packed and go to Sierra Madre where I can hide from government tax collectors for life. I may get mud on my feet and nails, stinky odor, plant camote, but I will be happy giving those tax collectors headaches guessing where I am. You see guys? I love tax evaders. =) I have a lot less to worry about these things. I don't have to spend my whole life with an income deducted with so much taxes.

3. Wish upon a shooting star that good mother fairy will come and wave her magic wand. POOOOFFF!!! here's your PhP51,562.00 children. Nah! It ain't happening at all. Good mother fairy never trusts Filipinos when it comes to money. She doesn't like pickpockets and certainly no to Keynesian politicians and bureaucrats.
4. Pray for an earth-bound gigantic asteroid to hit earth fast and see whats happens next.

Don't worry folks, our government can do the things they are very excellent at doing: more foreign debts for welfare. They could do this by selling global bonds and other forms of government securities. All in the name of citizen's well-being. Anyway, when the government successfully sold $1,000,000,000.00 global bonds in October 2010, never ever feel happy about it. Your good government has just successfully borrowed PhP440,000,000,000.00 in your name and they'll gonna collect the share of payment from you soon. And if ever you can't repay it your lifetime, your children and their children up to eternity will. Also when you see this "treasury offering bonds blah blah blah" never feel proud about it. Your government is selling your soul to creditors through bottomless borrowings.

Or do we care anything about these things at all?

We never had a hand on these debts. Mind what our government do in our behalf. I pray this lovely country will be spared from economic woes happening in Middle East. Be prepared because news of looming food shortage and hyperinflation is too loud to ignore.

Or am I just paranoid?

Sources:

1. Population projection - http://www.census.gov.ph/data/sectordata/popproj_tab1r.html

2. National Debt - http://www.treasury.gov.ph/statdata.html