THE MONTH of January is about to end, but some of us have yet to pay debts incurred for Christmas and New Year splurges. Even we who think of ourselves as “middle class” grimace over unending rise in prices of food and other basic commodities.
The unwelcome price increases scare wage earners whose pay hikes always lag behind.
More often than not, we respond by pinching pennies. To make both ends meet, we buy less of our basic needs – say, a half-kilo of meat instead of the previous one kilo at the risk of our family going undernourished. But it’s really a losing game because the value of our money has diminished.
Even the greedy merchants who impose higher prices for bigger profit eventually see the erosion of their own gains whenever they buy their own needs at higher prices, too. Sooner or later, whatever money they have saved in the bank, even if it earns interest, devaluates.
The phrase “A penny saved is a penny earned” no longer means what it says because it sheds its true value over time.
Therefore, why not make the most of it now?
Hasn’t the Great Book told us? “The love of money is the root of all evil” (1 Timothy 6:10).
Unfortunately, that “philosophy” could do more harm than good. A devalued peso has more value than no peso at all. Why not cost-cutting instead?
Alas, cost-cutting hardly compensates, especially if it means scrimping for three budget meals a day. While we can cut and slash expenses to the bone to conserve our bottom peso, the fact remains that we could get sick and unable to afford medical expenses anymore. Going into debt would then be unavoidable.
The only way to keep pace with inflation is to earn more, which is an elusive dream for the average Filipino wage earner; or have a “sideline” or small business in which to prosper.
Those who demand wage increase but don’t get it are doomed to sink poorer.
Let’s take a look at the minimum wage earner making P12,000 monthly. If this were his income in the 1980s, he might have lived like a prince. Today, he has to endure a spartan existence (no TV, no ref, no computer, no phone) to have a roof over his head, and to feed, clothe and educate his children.
When my neighbor TonyEli suffered business reversal, he literally hooked his children into moving from private to public school to save on tuition by offering them bigger daily baon.
Indeed the better challenge is always to beat inflation by outracing monetary inflation. There are cases, however, when getting it from increased income could aggravate the workers’ problem. For when laborers ask for wage hike across the board, their employer would need to hike prices of their products – which further fuels inflation.
The better alternative would be to stimulate demand by keeping prices low and thus produce more products. With more products selling like hotcakes, both the producer and the consumers benefit. This is the “secret” behind the success of small but export-oriented countries.
Working abroad for better pay is an option for Filipinos who no longer see the “future” in the local job market. As the song New York New York says, “If you can make it there, you’ll make it anywhere.”
Well, my only son is in New York. It’s good enough for me that he no longer asks money from me. ([email protected]/PN)