How Do Pinoy Pridists Propose to Pay Growing National Debt?!

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Bombo Radyo Cebu 

It doesn't take a doctorate in economics at (insert prestigious university) to understand that Makabayan Bloc is a bad joke. For example, Kabataan Partylist has a real lack of knowledge of economics. That's why I wrote that Kabataan Partylist will need to learn economics from the Ho Chi Minh Communist Youth Union. Just thinking about what Makabayan bloc wants irritates me to no end. Come on, Atty. Renee M. Co is a lawyer, and Raoul Daniel A. Manuel is a mathematics major. Raoul is a mathematics major but how could he promote the idea of increasing salaries while reducing prices at the same time? 

This is a proposal made by Kabataan Partylist some time ago. I could just imagine what the Ho Chi Minh Communist Youth Union, aka the Vietnam Youth Union, would have to say about that. If Makabayan bloc members understood basic accounting and economics, they wouldn't be saying such stupid stuff (read here). It's because a wage increase is only beneficial when there's a high demand for jobs (read here). But how can there be high demands for jobs when not all Filipinos are wired to be businessmen? However, if they ever studied basic accounting and basic finance, profits aren't unpaid wages. In fact, net income after taxes is barely half of the revenues. Part of the process includes paying wages. If the wages increase, the end product must also increase the prices. But some people just insult the laws of economics. Newsflash! Insulting economics will not make the laws of economics go away (read here)! 

Is their favorite source for economic solutions still the IBON Foundation?!

The solutions? I'm afraid that even when these are enforced, they may not be enough. One of the proposals is the wealth tax. Last 2023, the IBON Foundation (and I really refuse to take them seriously due to their outdated arguments) even proposed taxing the super-rich some more. That might be their way to pay the growing national debt. 

Growing billionaire wealth amid increasing poverty, worsening joblessness, and stagnant wages shows that it’s high time for the Marcos Jr administration to heed calls for a wealth tax on the country’s billionaires. This can be a substantial source of revenues for urgently needed income support and health services which are both being cut in the proposed 2024 national government budget. Economic growth can also be spurred with greater support for small farms and businesses.

A billionaire wealth tax can substitute for many consumption taxes that disproportionately burden millions of Filipino families struggling with high prices and low incomes. It can also signal the reversal of government policy to make the tax system more regressive especially since the tax reforms started by the previous Duterte administration and being continued today.

The recently-released Forbes Philippines’ 50 Richest list shows how much more affordable a modest wealth tax is for the country’s super-rich. Converted at prevailing exchange rates, the Php3.95 trillion net worth of country’s 50 richest reported in 2022 increased by 12.5% to Php4.44 trillion in 2023. The billionaire wealth tax proposed in Congress would have raised Php259.4 billion on this wealth and still leave them with Php4.18 trillion which is still more than their net worth reported in 2022.

The proposed wealth tax on the super-rich levies a modest 1% on wealth over Php1 billion, 2% over Php2 billion and 3% over Php3 billion.

The IBON Foundation even has this mentality that defies common sense. Below is something that the IBON Foundation made, which makes me puke why some people even take them seriously:

Imports can indeed be detrimental since imports are more purchase-focused. Buying imported products would register as an expenditure in the accounting process. However, there are times we need to import raw materials in times of scarcity. The IBON Foundation could talk about supporting agriculture. However, reading from this picture from the IBON Foundation, I wonder how the people at IBON propose to improve agriculture without liberalizing it? Come on, even Communist Vietnam has been liberalizing its agriculture, which has adjusted! The fool at the Philippine Anti-Fascist League page (which its new version barely gets interactions) even thinks Vietnam evolved through self-industrialization! That delusional brat (who I hear is now working in MANIBELA) is definitely in the wrong!

A good adjustment this 2025 in Vietnam, says this:
Government policies and investment incentives 
Vietnam’s government actively supports agricultural investments through favorable policies, tax incentives, and land use regulations. Key measures include:
  • Corporate tax benefits: The standard corporate income tax rate is 20 percent, but preferential rates (10 percent, 15 percent, or 17 percent) are available for high-tech and sustainable agricultural projects.
  • Land use and leasing rights: The Land Law 2024 allows foreign-invested companies to lease agricultural land, with annual rental price adjustments.
  • Investment incentives: Special tax holidays, exemptions, and subsidies are available for projects in organic farming, high-tech agriculture, and sustainable practices.
  • Special Economic Zones (SEZs): Investors in designated zones benefit from reduced land rental fees and enhanced infrastructure.

Vietnam may have eased the 70% maximum foreign investment ownership (of which 30% is owned by the government), in honor of these measures:

Investment strategies and market entry models

Foreign investors have several pathways to enter Vietnam’s agriculture market:

Joint ventures with local partners – Collaborations with Vietnamese agribusinesses can help navigate regulatory and market challenges.

Public-private partnerships (PPP) – The Partnership for Sustainable Agriculture in Vietnam (PSAV) has effectively mobilized resources for sustainable agricultural projects.

Direct foreign investment – With FDI in agriculture reaching US$1.2 billion in 2024, investors are entering the market independently, particularly in processing and agritech solutions.

Contract farming arrangements – Around 30 percent of Vietnam’s agricultural output** now comes from contract farming, offering stable supply chains and risk-sharing mechanisms. 

The Communist Party of Vietnam under General Secretary Nguyen Vanh Linh, and Nguyen Duy Cong aka Do Muoi (both dead), created the Doi Moi policy (read here). It would be hilarious how IBON would either cherry-pick or couldn't see that Vietnam's liberalization of agriculture has helped its local manufacturing. No, Vietnam didn't enrich itself first before opening up. Instead, Doi Moi started inviting FDIs to invest, which in turn helped Vietnam emerge. Vietnam's VND is far weaker than the Philippines' PHP.  

The more I look into IBON, the more I think, "Are these guys so outdated?" It's even more laughable that the Foreign Trade University has trustees who look like Enrique "Sonny" Africa and Rosario Guzman from IBON! Even funnier, how could the CPV even establish the FTU (read here)? Even funnier, the FTU's Facebook page is riddled with "Kabataan Partylist" members. 

Instead, all IBON focuses are on Pinoy Pride Economics aka the Filipino First Policy... again. IBON's proposal, whether it'd be a wage hike (while demand for labor is low and supply for labor is high), is just a third-world way of thinking. The other is IBON's focus on the wealth tax might not be feasible in the long run. In fact, it doesn't take a PhD in economics to figure out that overly high tax rates can encourage (1) tax evasion, and (2) money under the table transactions, even more. That's why I advocate for lowering tax rates as a means to attract more FDI. 

Whether we want to admit it or not, Pinoy Pride Economics fails to see how FDI could help pay the debt

Before people think FDI will drive Filipinos out of business or it'll increase national debt, we need to differentiate FDI from foreign debt (read here)! Even if I didn't get an MBA last 2014, I don't need higher education (and sometimes, I feel like I'm better off not having an MBA now) to understand the difference between letting foreigners invest in the Philippines vs. the Philippines borrowing money from other countries! To say that the late strongman, former president Ferdinand E. Marcos Sr., ruined the Philippines through FDI. That's an outrageous statement, given that the first Marcos Administration was driven by economic protectionism! To say that FDI will increase national debt is confusing investments with loans. Please, do some research and see the difference!

In studying Vietnam's economy during the 1970s, we can read this crucial detail:
SINCE REUNIFICATION IN 1975, the economy of Vietnam has been plagued by enormous difficulties in production, imbalances in supply and demand, inefficiencies in distribution and circulation, soaring inflation rates, and rising debt problems. Vietnam is one of the few countries in modern history to experience a sharp economic deterioration in a postwar reconstruction period. Its peacetime economy is one of the poorest in the world and has shown a negative to very slow growth in total national output as well as in agricultural and industrial production. Vietnam's gross domestic product ( GDP) in 1984 was valued at US$18.1 billion with a per capita income estimated to be between US$200 and US$300 per year. Reasons for this mediocre economic performance have included severe climatic conditions that afflicted agricultural crops, bureaucratic mismanagement, elimination of private ownership, extinction of entrepreneurial classes in the South, and military occupation of Cambodia (which resulted in a cutoff of much-needed international aid for reconstruction).

By then, the Vietnamese started to think about the losses. The "peacetime" economy was low. Have Pinoy Pridists even seen through that? In one way or another, Vietnam has become more and more open to FDI. There was a drop in Vietnamese pride, something that held back Vietnam economically. Do Muoi showed a more pragmatic approach, to the point he was actually worthy of sitting down as the CPV's General-Secretary! 

Pages 316-317 of From Third World to First showed how Vietnam's economy actually got balanced, also through FDI:

When he (Do Muoi) asked how he could increase the flow of foreign investments, I suggested that they should abandon the habits they learned in guerilla warfare. Development projects for the south that had been approved by the Ho Chi Minh authority had to be approved again in the north by Hanoi officials how knew little about conditions there. It was time-wasting. Next, projects approved by the government in Hanoi were often blocked by local authorities because of the supremacy of the local commander in charge, a legacy from their guerilla days. 

In fact, the Vietnamese had made progress. As a result of more contacts with foreigners and greater information on the market economy, ministers and officials had a better understanding of the workings of the free market. Greater street activity, more shops, foreign businesspeople, hotels--those were all signs of prosperity in Ho Chi Minh City and Hanoi.

Did Do Muoi wait for Vietnam to become "first world"? Did LKY tell Do Muoi to, "Well, just wait for Vietnam to become a first-world country before opening up to more FDI." The answer is still no. The CPV opened up with more contacts with foreigners and greater information on the market economy. Vietnam may still be run with the CPV as a one-party state (which is why I believe their mayors are appointed). However, Vietnam understood how more free market, despite their stance as a Socialist state, had helped them solve problems like inflation and rising debt! 

Are Pinoy Pridists now willing to open #SahodItaasPresyoIbaba stores to help solve the national debt crisis?

During the election campaign, I wrote that I'd vote for Teodoro "Teddy" A. Casiño, if his supporters could run a successful #SahodItaasPresyoIbaba store. I still find it utterly foolish that President Ferdinand "Bongbong" R. Marcos Jr. even promised that PHP 20.00 kilo of rice. As much as I believe Bongbong needs to be hammered, I still dare the Pinoy Pridists to do business themselves to help solve the national debt crisis. This is daring them to open #SahodItaasPresyoIbaba stores nationwide (read here).

Instead of demanding that the government to legislate the PHP 1,200.00 minimum wage law while having lower-priced goods, they better show that it's profitable to do so. I was laughing like a little child watching a funny cartoon while I wrote about opening #SahodItaasPresyoIbaba stores. During that time, I dared them to pay PHP 750.00 per day. Now, they increased to PHP 1,200.00. As I imagined, are they willing to sell Ganador at PHP 20.00 per kilo? The SRP is already PHP 2,640.00. The capital per kilo is already PHP 52.80. That means they're losing PHP 32.80 per kilo for every kilo of Ganador sold at PHP 20.00 per kilo. Can that even sustain paying their employees at PHP 1,200.00 per day? Let's say that they get the entire baranggay to buy their marvelous PHP 20.00 per kilo rice, can they also pay for the other costs?

Business & Plans

Here's a picture of a sample income statement. Sure, let's say that they got an entire village to buy the wonderful PHP 20.00 kilo per Ganador. Let's say that they got 100,000 people to buy the wonderful rice, temporarily paralyzing other establishments that sell Ganador at PHP 62.00 to PHP PHP 64.00 per kilo. That would mean a cap price to generate profits from the PHP 52.80 kilo cost. One would need to account for the wrapping materials. After all, who wouldn't want to buy a PHP 20.00 per kilo Ganador? However, the big question to be asked is, "How long will it be feasible?" 

To look into the sales, they might generate sales of PHP 2,000,000.00. However, can they really recover the costs since they will need to spend at least PHP 2,640.00 per sack of Ganador? But not just Ganador (or any item for that matter), can they really generate a profit? They would still need to account for all costs, whether direct or indirect. They will still need to spend on operational expenses. Chances are, they might even be using the air conditioner 24/7 if they open the store 24/7. People working on a night shift will require more payment than those not on the night shift. I'd hate to do computations and see how negative their net income will be, in the long run!

Whether we want to admit it or not, even non-profit organizations still need profit. For starters, the Tech Target describes the non-profit organization as:
A nonprofit organization (NPO) is one that is not driven by profit but by dedication to a given cause that is the target of all income beyond what it takes to run the organization.

Because of this, NPOs receive tax-exempt status from the federal government, meaning they don't have to pay income tax.

Nonprofit organizations are often used for trusts, cooperatives, advocacy, charity, environmental and religious groups. Many, but not all, NPOs have paid staff in management positions; almost all use volunteers.

Unlike for-profit businesses, NPOs have no owners and any surplus profits after operating expenses are used to further its goals instead of being distributed between members or employees of the organization.

If you look into how an NPO works, the surplus profits after operating expenses are still necessary to further the organization's goals. NPOs may be paying their members salaries instead of profit sharing. In short, they may be paid administrative fees while profits are used to enhance the organization. This means that any business model that doesn't generate profit will collapse. Even NPOs will still need some profits to keep themselves running. Profit sharing may not be done but these profits are still needed to further its goals. 

Given that #SahodItaasPresyoIbaba stores will lose more than they make in profits before taxes, these clowns may not even be able to pay taxes. Why would they be taxed if there's no income to be taxed? In taxation, there's such a thing as tax avoidance. For example, I would pass receipts that were relevant to my business expenses. I bought a brand new PC at PHP 32,000+. That would mean that I could get a deduction of PHP 32,000+. The same goes for any expenses incurred during operations. They may generate sales of PHP 2 million based on PHP 20.00 per kilo of rice. However, they would have a loss of PHP 4.4 million in the process, just from the "magnificent" PHP 20.00 per kilo Ganador. I wonder where they will get the money to pay PHP 1,200.00 per day for their employees. If they have employed another entire baranggay with a population of 50,000 people because they offer high salaries--they would be spending PHP 60 million for salaries. Their sales worth PHP 2 million will not cover their losses! In short, nothing will be taxable! 

This is why I advocate for open FDI, no matter what the naysayers say. The question is, do they understand what FDI is all about? They can go ahead and keep quoting from Makabayan bloc as their "ever best source". They can go ahead and remain as Flor Contemplacion Crybabies. But face it, the laws of business and economics don't care about their feelings! 

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