Poverty, Government and Unequal Distribution of Wealth in Philippines

NB: We do not resell your papers. Upon ordering, we do an original paper exclusively for you.

NB: All your data is kept safe from the public.

Table of Contents

Poverty Data Gathering Tools
Etiologies of Poverty
Programs to Alleviate Poverty
Conclusion
References

Filipinos are in grave situations of poverty as of now. According to UNDP statistic last 2004; the numerical rate 36.8% is the poverty level of the entire Filipino population. Crude estimation of this count into raw rate is 70 million Filipinos are below poverty line. However, statistics do not reveal the complex nature of poverty; indeed, it is a mistake to assume that poverty can be measured in monetary definitions (Eadie 35).

The Philippines provides a concrete example of GDP growth that did not reduce poverty, although the economy recorded growth of more than 4% in 3 of the past 4 years. The 2003 FIES illustrates average family incomes to have increased by only 2.5% over the 2000 level, while the CPI shows an inflation rate of 13.9%. Judging all these data obtained, it is therefore almost certain that the poverty level has increased during this period. It most likely has increased by a greater level than from 1997–2000, when average family incomes has grown by 18%, inflation has been 22%, and the poverty incidence of the population has increased by 1% (Poverty in the Philippines 2). The author of the book Poverty And The Critical Security Agenda, Eadie (33), added:

Quantitative analyses of poverty have become more sophisticated over the years to be sure, yet remain problematic and in certain ways rooted in assumptions of rational choice behavior. For instance, poverty can be measured through simple income and expenditures or poverty line however; this does not account the expenditures on those goods and services that are variables for well-being such as food and education. Negative expenditures, such as alcohol or cigarettes, also play part in the considerations.

With this, various instrumentations are being utilized to assess the conditions of poverty. Subjective claims remain to be weak basis if it is not validated. Subjective inferences are those data obtained from the subjects but have no specific proofs or reference in any study done by trained individuals. Objectivity is a must in statistical gathering however, if this is not provided proper validation, still the data remains to be weak basis (Maglaya 176).

Poverty Data Gathering Tools

Poverty measurement practices for determining the numerical data partly reflect what we know – or think we know – about inequality and poverty profiles in the Philippines. According to Edmonds in his book, Reducing Poverty in Asia: Emerging Issues in Growth, Targeting, and Measurement, the phase of assessment usually involves the set poverty lines and welfare indicators. This is where statistics label an individual poor. Such considerations are dealt first before producing such claims (Eadie 198).

In terms of welfare indicators, determining the magnitude of poverty and inequality the government uses current household incomes and expenditures via national surveys. Using standard arguments in microeconomic theory, it can be concluded that since welfare level are being determined by “life-cycle” or permanent income, and since current consumption is a good approximation of this income, current consumption can be better justified as a measure of current welfare. This, however, does not suggest that income does not vary over time. It does, and sometimes these changes are largely comparable to the former (p.198-199).

Talking about setting poverty lines, this does not depend on subgroup’s conditions or to which standard of living do they belong. Poverty lines constructed for various subgroups must be fixed in terms of given standard of living. These set are said to be consistent and imply the same command over basic necessities of consumptions. It is well known that as household income rises, the consumption of cheap and low quality goods decrease and the families focus more on the quality products that they can still afford. These are some of the scenarios that indicating the dynamic characteristic that affects poverty lines (Eadie 200).

Another sophisticated data-gathering tool in quantitative diagnosis of poverty conditions is by the use of Human Development Index (HDI) that has been introduced by ul Haq in the 1990s. This involves the consideration of life expectancy, literacy rate and GDP per capita. The HDI is now being used by the United Nations Development Programme or UNDP, to rank countries in terms of their economic development status. According to the 2004 Human Development UNDP repot, the Philippines has been ranked 83^rd and considered to be a medium development country. The advantage of this tool is the test of comparison between different countries annually. However, the negative aspect that coincide in this method it its limitation towards other factors such as domestic variations that exists between different regions, rural and urban areas that exist in the household. This primarily occurs because of the generalized perspective of this intervention (Eadie.39-40).

Etiologies of Poverty

Filipinos are usually known for their extravagant fiestas and their various tourist attractions. The proud natural resources have lured “balikbayans” or Filipinos from abroad and tourists. Adding into that are the OFW or Overseas Filipino Workers that produce additional income for the country through remittances. Aside from the macro-economical income source of Philippine government, such conditions give off pseudo-economic boost for the country’s economy. DFA or Department of Foreign Affairs has estimated that there are 5,488,167 Filipinos working overseas that are scattered to over 193 countries during 2002 (Arya 72). The question left for the public is where does this sum of money go considering that the incomes both internal and external are present? Such question triggers the public minds that usually cause demonstrations and governmental blame.

Another factor to be considered is the Philippine international debts that primarily occurred during the time of Marcos and has progressed in the current regime. Sad to mention but as of today, Filipinos are part of the 100 most heavily indebted poor and middle-income countries that must service over 2.3 trillion American dollars in combined debt-stock yearly (Debt for Equity Eadie). According to an online data, Poverty in the Philippines, economic growth has become insufficient in order to support the population growth of the country: GNP per capita has lingered at around $1,000 for the past 20 years and has not even increased. Disasters that have occurred are one of the main reasons that tarnished the economy of the Philippines. Importantly, the crisis came at the same time as the devastating El Niño drought during mid-1990s. This evidently caused domino effect in the economy of the Philippines in which decline has been the particular evident strata. Here is the list of the chronic macroeconomic problems in the Philippines that have long been occurring:

Gradually diminishing revenue collection inducing fiscal deficit and heavy public sector debt
Low investment environment that results in particularly low foreign direct investment
Inactive loans in the banking firms
Chronic loss of international competitiveness
Corrupt structural governance and inefficient economic management

Programs to Alleviate Poverty

In the article found in the official website of the Philippine government (27) entitled, Poverty alleviation tops PGMA’s main goals in the next 3 years, proclaims the president’s own statement regarding her programs and future programs for the alleviation of poverty.

She said increased government earnings or revenues either through raising the effective collection of taxes or sale of government assets is necessary component of poverty alleviation. With the raised revenues, she said the next important thing to do in the next three years is to invest more in human resources and physical infrastructures to create jobs and upgrade the country’s competitiveness. She said social services, like making cheap medicines available, improved healthcare and anti-hunger campaign, which are already being addressed by her administration, are also important components of the poverty reduction program of her administration.

The president’s statement has been questionable to most of the public and the tarnished trust of the people’s body has greatly affected the initiations of this plan. People’s cooperation has become difficult to initiate due to the governmental corruptions that have occurred. The effectiveness of such programs being implemented by the Philippine government has seen to be effective however, only for a short time (Glatzer 124). Most of the programs regarding poverty alleviation are still ongoing as per current administration. Target outcomes of these projects are 2010. However, according to some critics, the results so far of these projects are not yet being that evident (Debt for Equity…27).

Conclusion

The poverty status of the Philippines has not yet been alleviated. The condition of poverty still affects more almost half of the Filipino population. The inequalities of resources partitions are not specific hence; the divisions of such are also affected. The question about the condition of poverty and inequalities in the Philippines is now answerable by the summary of the crude poverty rate 40% and 70 million poor families living in this country. These poverty claims are being validated by the use of Human Development Index (HDI) that are also being utilized by the (UNDP) United Nation development Programme in order to obtain their data. Various notes are important upon the obtaining of these data such as welfare indicators and setting of poverty lines. The probable etiologies of this poverty in terms of macro-economical scope, as addressed in the body of study, are the following gradually diminishing revenue collection inducing fiscal deficit and heavy public sector debt, low investment environment that results in particularly low foreign direct investment, inactive loans in the banking firms, chronic loss of international competitiveness and the corrupt structural governance and inefficient economic management. There are programs being initiated to combat poverty situations however, as according to the study the results seem to be not evident especially for the public’s perspective. Poverty still lingers and unequal distribution of resources are still present in the Philippine society.

References

Arya, Sally. Living Home: Filipino Women Surviving Migration. In M. C. Pagaduan (Ed.), Poverty, Gender and Migration (pp. 72). Sage Publications Inc, 2006.

Arya, Sally. Poverty, Gender and Migration. Sage Publications Inc, 2006.

Barcelon, Ed. Fight Philippine poverty.(Voice from the South). Manila Bulletin. 2007. Web.

Debt for Equity in MDG Projects; A Philippine Proposal for Converting 50 percent of the Debt Owed by the 100 highly indebted countries to equity investments in the Millennium Development Goals of the United Nations.(Opinion & Editorial) [Letter to The Editor]. Manila Bulletin.2011. Web.

Eadie, Peter. Poverty And The Critical Security Agenda. Ashgate Publishing, Ltd., 2005.

Edmonds, Cedric. M. Reducing Poverty in Asia: Emerging Issues in Growth, Targeting, and Measurement. Edward Elgar Publishing, 2003.

Glatzer, Walter. Rich and Poor: Disparities, Perceptions, Concomitants. Springer, 2002.

Maglaya, Allan. S. Nursing Practice in the Community. Marikina City: Argonauta Corporation, 2005.

Orbeta Jose., H. C. Family, Vulnerability and Family Size: Evidence from the Philippines. In H. Khan (Ed.), Poverty Strategies in Asia: A Growth Plus Approach (pp. 72). Edward Elgar Publishing, 2006.

Poverty-in-the-Philippines: Causes of Poverty in the Philippines. 2011. Web.

Poverty Strategies in Asia: A Growth Plus Approach. 2010. Web.

Son, John.Philippines: For Growth to Continue, Poverty Rate Must Come Down. Inter Press Service English News Wire , 1997, pp. F3.

Click Here To Order Now!