Don't Complain About the PHP 500.00 Noche Buena Remark While Supporting the Filipino First Policy

It's that stupid when I read the remarks of DTI secretary Cristina Roque made a really tactless remark. Sure, the remark had people angry because, in reality, the whole noche buena at PHP 500.00 for a family of four will not match, given these ingredients:

ham, P170 to P945;
fruit cocktail, P61.76 to P94.41;
all-purpose cream, P36.00 to P72;
“nata de coco,” P52.50 to P62.50;
“kaong,” P76.50 to P84;
“queso de bola,” P210 to P470;
cheese, P16.50 to P310; and
mayonnaise, P20.40 to P245.85. /dda

As I read through the list above, I'm reminded of how much I don't like December because it's the season of abounding toxic positivity. The song "It's the Most Wonderful Time of the Year" is in full blast, even after Andy Williams died of old age in 2012. I tend to drive the road and when traffic hits, I always think about the problem of last-minute Christmas shopping, and scream it, "Isn't it any wonder why the Philippines doesn't improve?" It's effortless for me to keep forgetting that the bad attitude of Filipinos is but a symptom of a much larger systemic problem.

It would be easy to say, "Well, the solution for this problem is once again, well, #SahodItaasPresyoIbaba." It doesn't take a degree in accountancy to figure out that any increase in salary, will add to the overall costs of production. Prices can only go lower in certain ways like under the princples of economies of scale, demand goes lower while supplies go higher, and when the technology to produce something gets cheaper. A desktop PC back in the 1990s was a luxury, unlike today, when a middle-class family can now afford one without worrying about the bills. In time, businesses may need to sell their newest products at lower prices because production costs are indeed lower than they were in the 1990s!

This should be funny because we have people who insist on #SahodItaasPresyoIbaba who also believe that FDIs are invaders. The job market is still run by the principles of supply and demand. For people who insist that Filipinos should "strive on their own rather than accept FDI", then the question is, can Filipino businesses truly drive up the demand for labor, which in turn will drive up the demand? That's why I advocate that the Philippines become more FDI-friendly, because not all Filipinos are meant to be entrepreneurs! It's common sense that not every Filipino is born ot be an entrepreneur!

Why are the costs of noche buena supplies becoming expensive? We need to look at the real issue of supply and demand. We need to look at the issue of supply chain management. The prices of gasoline increase or decrease not by whoever is president but by the world market. Supply chain management is intrinsically linked with supply and demand. No one can defy supply and demand and not get horrible consequences. For example, current-day Venezuela or the Great Leap Forward disaster under Mao Zedong, are examples that the laws of economics are immutable. All these factors also help drive up the costs of the noche buena items.

By restricting FDI and insisting that Filipinos should "strive on their own" with Import Substitution Policy, they ignore that national industrialization can never happen without outside help. The lack of businesses will mean a lack of supply for Noche Buena items and and lack of demand for labor. One means that the prices of Noche Buena good will soar up due to high demand vs. low supply. On the other hand, salaries will continue to remain stagnant because labor demand is low and labor supply is high.

Comments

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