IT is funny to hear people—usually wealthy celebrities—talk about leaving the country if this or that person is elected to office. It doesn’t matter if it is the Philippines or the US. But they never leave, and the reason is simple: money.
Money beats politics always, and these profoundly “dedicated to a cause” individuals know that their “cause” is not where their wealth comes from.
During the past 30 years, the rich have gotten significantly richer all over the world. The “eat the rich” morons like to talk about Gates, Bezos, and Zuckerberg, but those examples are just plain dumb. They increased their wealth through an increase in stock prices, just like the wealthiest here in the Philippines.
The Black Death in the 1300s created “Capitalism” and the “Middle Class.” So many people died in Europe that there was a labor shortage, and for the first time in history workers could charge a premium for their labor. By premium, I mean more than just enough to live on which is what the former feudal/serfdom economy provided.
With more people having more disposable income and therefore discretionary spending, artisans and craftsmen like shoemakers and the like also became wealthier. This did cause a large increase in inflation but that is another story. Also, landowners were forced to accept monetary rents rather than a share of the crops as tenant farmers could sell their excess production for a healthy profit.
By the 1800s there was a genuine large “Middle Class” between the working class, which saved little, and the “rich” that owned most everything. The Middle Class had gained both wealth and political power. The “social welfare” programs of today are the result of several centuries of Middle Class demanding more government-provided services in return for their taxes.
However, in the West, the Middle Class has been dying for decades, as the ladder of economic mobility has been broken. One reason is that the “welfare” has been paid for by the Middle Class, resulting in a “richer” poor class and a “poorer” Middle Class. Since 1975, it has been simply “richer poor,” “richer rich,” and “poorer middle” economic groupings.
Government polices has been brilliantly effective. The “poor” have been kept just “rich” enough to stop them from grabbing torches and pitchforks against the governments. Remember Obama’s “free” government-provided cellphones for the “poor”?
The “Middle Class” has been kept just “rich” enough—but not too rich—to keep them working and paying taxes. The “Middle Class” are still seeing the value of their most widely held asset—a house—increasing in nominal value. But what is not talked about is that the “poor” are not climbing the ladder to the middle and, of course, the middle are not going up to become “rich.”
Ready for a T.G.Y.F. (Thank God You’re Filipino) moment? Note that this moment applies to most of “underdeveloped” Asia.
In 1991, 71 percent of the Philippine population was in the poor economic class, with 28.5 percent in the middle. By 2015, the percentages changed to 58 percent lower and 40 percent middle. The “high income” percentage has doubled from 0.7 percent to 1.4 percent. That is economic mobility. Some 23 million more Filipinos joined the middle based on consumption not income. Further, it is people that have owner/renter type housing with strong roofs and walls rather than “squatting.” These are families with refrigerators and air conditioning.
Certainly, the trend of Philippine economic mobility has been severely derailed by the Covid economic Armageddon. But that trend will return as soon as you decide to return to the malls. Go shopping, please.
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