“Let the lion’s share of the national budget be directed toward socio-economic goods, but more resources should be allotted to national defense.”
No national government in the world has unlimited resources at its disposal. Consequently, the need to establish priorities and make choices is least acute in the case of a vast and well-endowed country like the US; it is most acute in the case of any Third World country.
The Nobel Economics Prize winner Paul Samuelson of the Massachusetts Institute of Technology sought to simplify the issue of government resource allocation by speaking of a choice between better- meaning socio-economic goods and guns. Prof. Samelson’s thinking on the issue was heavily influenced by world history since the Napoleonic Wars, and particularly by World War II and the Cold War.
Prof. Samuelson’s guns-versus-butter characterization of the government resource allocation issue is largely true of the countries of the First World; it is largely untrue of the countries that comprise the Third World. In the latter countries, allocators of public-sector resources dot not have a two-way but a three-way choice. Corruption is the third choice in the Third World government resource allocation situation.
The truth of the matter is that the annual national budget–P6.35 trillion for 2025–is made up of three parts: a legislated allocation for socio-economic goods, a legislated allocation for guns/national defense and an unlegislated allocation for corruption.
Current examples of unlegislated allocations for corruption are the illegal Department of Education (DepEd) and Office of the Vice President (OVP) expenditures, revealed in the recent Senate hearings on the proposed 2025 national budget.
A widespread feeling among the people of this country is that at least 20 percent of the national budget approved by Congress and the President of the Philippines goes toward what economists call ‘leakages’. The leakages take various forms—unauthorized and inadequately documented expenditures (such as the DepEd’s and OVP’s) overpricing, rigged biddings, fraudulent reporting of performance, non-adherence to project specifications, etc.
Over the decades, this country’s government-spending policymakers have chosen to allocate most of the government’s resources to socio-economic goods rather than to guns. Two factors have been largely responsible for that choice—the steady supply of military equipment to this country by the U.S. and the need to keep up with the socio-economic requirements of a rapidly growing Philippine population. The termination in 1991 of the Military Bases Agreement led to a dwindling of U.S. military-equipment donations to the Philippines.
Under the 1987 Constitution, national defense does not enjoy the highest priority in government spending, and the Department of National Defense (DND) has always had to fight for every peso of budgetary allocation. What has been allocated every year by the government was barely enough to provide the DND with the naval, air and land weaponry it needs to be placed among the countries considered to have first-rate armed forces.
The makers of this country’s military policy obviously have been believing that the Philippines does not have to spend much money on military assets because of the existence of the U.S. – Philippines Mutual Defense Treaty of 1952. But circumstances have changed. Now there is an aggressive China that rams, lasers and water-cannons inadequate Philippine naval assets, dangerously buzzes Philippine Air-Force (PAF) craft and prevents Filipino fishermen from freely making a living in Philippine waters.
For the Philippines, the situation in the West Philippines Sea is pitiful, even pathetic. This country is openly being oppressed and shamed by an increasingly aggressive China, and there is little that it can offer by way of resistance.
Joint maritime and air patrols with allies and donations of military assets by them are fine, but there is no substitute for a build-up of our military assets—at sea, in the air and on land—with our own resources.
That will require a modification of the butter-versus-guns approach to the allocation of government resources. By all means, let the lion’s share of the national budget be directed toward socio-economic goods, but more resources should be allotted to national defense.
And of course, a sharp reduction in the corruption element of government spending will free up more funds for Philippine Coast Guard (PCG) ships, F-16s for the PAF and more modern fire power for the Philippine Army (PA).
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