Historically, the Philippine government has become used to borrowing to support its operations, infrastructures, and budget deficit. With each incoming administration, the short-term remedy is to borrow instead of improving the capacity of the nation to raise revenues. This cycle of debt reliance and the interest building up on it is a precarious route that not only imperils the current economy but also the future generation to be burdened with having to inherit it.
Why should the government keep borrowing? Supposedly, the government should be able to fund its projects with effective revenue collection, prudent expenditure, and wise economic policies. But billions are borrowed every year with little to show by way of economic growth. Tax collection remains inefficient, public funds find their way into corruption, and industries that will bring national income are shut out or run on a half-baked scale. The final result is a country whose economic existence depends not on production but on the charity of moneylenders at interest rates that compound ruthlessly.
Every peso borrowed now is a peso to be repaid later—and probably at a higher price. The out-of-control national debt consumes the budget for the critical services like education, public health, and social welfare. Instead of funds being spent to improve the lives of Filipinos, most are used for paying debts, and the populace is left to suffer from bad public services. Worse still, wanton borrowing with no concrete plan for paying it back or generating income leads to nothing but economic instability. When debt payments suck up government funds, it is the common man who ultimately pays through increased taxes, increased prices, and devaluation of currency.
Every administration views borrowing as if there were no constraints on it. Minimum accountability is involved when the bills are run up, and even less transparency regarding how such money is being spent. The problem is not just with the mounting figures on the pages of financial reports; it’s with the eventual ramifications of a country in a cycle of endless borrowing. The burden is not left with a single government—rather, it is passed to the next and increases exponentially each year until it becomes too much to handle. If this goes on, the new-generation Filipinos would not have inherited a sound nation but a debt-ridden nation that never enrolled to carry it.
The government must break itself of this debilitating habit of borrowing finally. Rather than taking the easy route of borrowing, economic policy must aim at revenue raisers, fiscal strings measures, and stopping corruption that drains national coffers. Development and infrastructure initiatives must be funded on sustainable terms, not debt-financed expenditure that merely kicks the can down the road. A country cannot create a sound future if it continues to exist on credit. It needs to work for it, create it, and invest prudently—before today’s obligations turn to economic wreckage.
