Editorial

The economics of inflation

The Bangko Sentral ng Pilipinas recently announced that prices of products will continue to spiral up in the next months amid the increasing inflation rate in our country, citing factors, among others, the weakening of the peso and rising cost of petroleum in the world market.

We know that cost of petroleum products or fuel are always fluctuating when in the 1970s the one liter gasoline was only 35 centavos and jeepney fare was 25 centavos that the PUVs could go interior streets because fuel was then cheap. 

Today, the cost of living is becoming a bitter pinch with the so many mouths to feed, especially among large family size. Will our government suspend the implementation of excise tax on fuel as this is being blamed as contributory to inflation? Rice stock is also a bewilderment as prices of commercial varieties roll high and NFA rice supplies dwindling… is there really a shortage on this staple food or is it hoarding that creates artificial shortage? This is something to watch.

The Department of Trade and Industry has to keeping tight the monitoring of prime product prices as it mandates the SRP (suggested retail price) ceiling to prevent profiteering. The Pasada Subsidy program of the government is already rolling in some areas to cushion gas price impact among franchise transport groups but still grunting as it is not enough to cruise the crisis. But beneficiary sectors should instead be thankful for the government aid even scampy could they be… at least there is to contend with.

The Philippines is not the only nation that suffers the consequence(s) of high inflation rate. What is important are the measures instituted to cushion its impact on the social and economic lives of the population. Families have also to institute measures of thriftiness and tight budgeting, shelving those unwarranted spendings such as vices and luxuries… to be able to distinguish the needs and wants. Primary needs are always the top of priority. As this moment in time is upending the culture of frugality but not sacrificing savings for emergency needs. Children have to be taught the culture of wise spending.

The US suffered economic recession at the prelude of World War II but massive military industrialization with multitude of employment made the country recover from depression. But we don’t have to manufacture armaments to recover from inflation… instead instituting rationale, workable measures to tame inflation.

Inflation can be overcome if we learn how to cope with it unless nothing is left to make the economic adjustments. Somethimes, we have to learn the paradign of economics, not necessarily going to formal schooling to learn it. There are skills learned not from the schools but on practical usage and mastery. What is of course non-consoling is the fact that there is none to save or none to budget in the face of extreme poverty… this would be the worse scenario in the face of inflation.