US fiscal cliff, much ado about nothing

THE upcoming US fiscal policy implementation dubbed as “fiscal cliff” has caused an uproar. Everyone is off-balanced over the possible effect of it to the American economy and the rest of the world. As early as now, people are increasingly apprehensive over the the possible effect of the scheme to their life and livelihood. As it is, even people bereft of knowledge of what it is all about seem alarmed of what could be an “Armageddon” that awaits their life.

But what is the “fiscal cliff” that the American is comparing to the “sword of Damocles” that may drop anytime on their head or neck? According to About.com, “Fiscal cliff” is the popular shorthand term used to describe the conundrum that the US government will face at the end of 2012, when the terms of the Budget Control Act of 2011 are scheduled to go into effect. The failure of the Obama administration in the past four years brings to fore a rather harsh measure to address the protracted problem of financial crisis that the US is in right now. Fiscal cliff is a mere radical approach to the implementation of a fiscal policy which all countries in the same position are doing. It is a policy meant to regulate tax implementation and government spending. The policy works both ways to affect the economy either positively or negatively. In the fiscal cliff that Pres. Obama’s economic team envisions, it will be approached in a revolutionary way to effect an immediate change in the US financial system that is deep in crisis.

A huge reduction in public spending is planned but increase taxes are expected to complement this government plan. At first glance the immediate impact is contraction of the economy will immediately ensue and one of the problems expected to be addressed is the inflation and the continued spiraling cost of products. It could be recalled that because the government was not successful enough in arresting the problem of recession and depression during Obama’s four-year term, that is despite the release of stimulus packages, it created an increase in liquidity and excess of cash resulting in the creation of needless demand, leading to inflation. The fiscal cliff is expected to start to take place at midnight of December 31, 2012.

Tax hikes and decreases government spending run in opposite directions. While tax increases tend to siphon off excess liquidity in the economy, decreased government spending will negatively affect the Gross National Product growth rate that may prove to be difficult to accept and may lead to another round of recession in a nation that is already mired by a fiscal crisis. It is not hard to understand that the government is one big spender in the economy which can make or break the situation. Of course it is a given that the two- pronged action of the government is expected to cut the government deficit by more than $ 500 billion. But more than anything else, the abrupt move could create disarray not only in America but also the rest of the world whose people are already indirectly affected by the global slowdown.

But be that as it may, all these potential economic actions and plans to lessen if not reduce the impact of this global financial fiasco that originated for the US, are all within our capability to absorb. Fiscal cliff is mere fiscal policy in an active mode. The crisis that the US is in right now after so many years of neglect and inaction could reach a point of no return unless drastic measures are resolved and really get done. The distressing thing is that, the US economy brings with it a lot of influence to the rest of the world. As such, whatever happens to the US economy, happens to the rest of the world.

Smuggling gone from bad to worse just like other criminal activities

Not everything is good news under President Aquino’s reign. For one, studies have found that smuggling has worsened under the Aquino administration.

News reports state, “Smuggling in the Philippines is at its worst under President Aquino’s administration, with the smuggled value averaging $19.6 billion annually, an explosion from the comparable figures of $3.1 billion and $ 3.8 billion yearly during the terms of Presidents Joseph Estrada and Gloria MacapagalArroyo, respectively,” report said.

This situation unless robs the government of the much needed revenue which when translated to income brings a lot of benefits to the Filipinos. But more importantly, the thrust of the govern- ment to increase as much revenues to finance government and public spending is in peril. This is a big blow to the governments drive against graft and corruption. The official family seems to have overlooked its own backyard. Who should take the cudgels for this particular brouhaha?

These situations may at certain point be forgivable, but not the increasing criminal activities and brutal killings that are brazenly committed with utmost impunity. Day-in and day-out we hear and read news of brutal murders, massacres and rape incidents that are committed without let- up and yet nothing drastic has been done by authorities to immediately effect an outright solution to this problem. It is as if the situation is normal and crimes just happen as matter of course in our midst so let’s jsut accept it with a grain of salt. Not a word has been heard from the people concerned that will alleviate the situation.

It is easy to think that the haste to put in Purisima even prior the retirement of PNP Chief Nicanor Bartolome, is because of the failure of the latter to curb the growing menace in our community, particularly the Metropolis.

The increase in the criminal incidents which we have been witnessing all along has gone bold to the extent that the call to bring back capital punishment has grown by leaps and bounds. I think lawmakers should take notice of this and seriously give due attention, if only to deter further heinous criminal activities. (EJLopez, Ph.D. is an Associate Professor of Economics @ University Of Santo Tomas. For comments email: doc.ejlopez@gmail.com with cc to: opinon@manilatimes.net), YANGON: For prominent comedian and former political prisoner Zarganar, the US President’s visit Monday to Yangon University marked nothing less than a “rebirth” of an institution whose history is entwined with the nation’s struggle for freedom.

From its role as a cauldron of the independence movement against British rule— led by Aung San Suu Kyi’s father— to the scene of a brutal 1988 crackdown on student protests, the campus has for decades incubated dissent in the face of authoritarian rule.

“I got my degree here in 1985... Obama comes here 27 years later than me,” Zarganar quipped, explaining the sight of the painted and refreshed campus left him “highly emotional”.

The “rebirth” of his beloved university follows decades of neglect after Myanmar’s military rulers closed campuses and moved universities out of towns in an effort to weaken their influence, following a student revolt in 1988.

Hundreds of thousands of people joined summer protests that year, marking the most serious popular challenge to the junta, before an army crackdown that killed more than 3,000.

The university’s closure sparked two decades of decay for the once august establishment, as dormitories and departments sat empty, with the main hall— which had been the assembly point for protest— used only for occasional ceremonies.

But speaking on Monday, Obama raised hopes the university would emerge from the doldrums, in an impassioned address aimed at bolstering Myanmar’s rapid, but fragile, reform process.

Paying tribute to its extraordinary role in Myanmar’s gradual emergence from decades of military rule, Obama name checked former students including the nation’s independence hero Aung San — whose daughter Suu Kyi sat in the front row with US Secretary