Becoming a welfare state
In a 2016 survey of the International Social Survey Program (ISSP), Filipinos are found to be so much more demanding of governmental services than other nationalities in Asia and in other parts of the world. The Filipinos’ attitude towards the government appears to be seeking for a full welfare state.
Free health care, free college education, assistance for the aged, assistance to industry, socialized housing, and unemployment assistance are just few of the things that Filipinos want the government to provide. Most of these wishes were already granted.
The Duterte administration has been credited for implementing populist programs such as the Universal Health Care, Free College Education, and expansion of the Pantawid program, to name some. His administration likewise did not hesitate to borrow money from local and foreign sources to bankroll the COVID-19 vaccination program and giving cash aids to the vulnerable sector affected by the lockdowns.
At the height of escalating prices of petroleum products due to the ongoing war between Russia and Ukraine, calls to suspend the excise tax on petroleum products and the giving of cash aids to the vulnerable sector are gaining momentum. Few weeks or months from now when the prices of commodities will become unbearable for most of the average income and poor families, the government will again come to our succor and extend cash subsidies. It may even go to the extent of yielding to the call of suspending the excise tax at the expense of having a sharp decline in revenue collections which are needed to fund vital government programs.
The current administration may have responded well to the needs of the people during this crisis, but it will be leaving to the next administration a huge amount of local and foreign debts. Gauging from the campaign promises of the presidential candidates, it seems that the next administration is set to continue the legacy of Duterte’s welfare state or even transform the Philippines into a full-fledged one.
The danger in welfare states is that people’s entitlement can become out of control. With people patronizing leaders who cater to their demands just to stay in power, there would be no end to the government’s magnanimity.
The welfare state system was set up by German Chancellor Otto von Bismarck in the 19th century for the elites of Europe to make peace with the “people.” The hallmark of Bismarck’s welfare state model is to give more social welfare benefits to the people than the taxes they paid. The difference between what they paid and what they got would come from two sources. First, it would come from the rich, who would pay higher rates. Second, it would come from the next generation in the form of loans or government debts.
Bismarck’s model might have earned praises from the “people”, but history has judged it to be an unsustainable model. This model is headed for bankruptcy.
While we commend the government for responding to the call of the people, we should also realize that we cannot just completely rely from the government. Like successful business empires, the government must be managed professionally and not used by politicians to gain popularity at the expense of the state’s survival.