Listen closely to any of the past senatorial debates and you'll come across many candidates answering a problem with subsidy. How do we help the farmers? Subsidize them. How do we help the senior citizens? Subsidize them. And you'll see that theme recurring every single time a question is posed. It's as if the solution to any of our problems is to throw money at it and it'll go away.
Here's my own little story about subsidy and why it does not work:
I'm a baddict (a badminton addict) and I would always try to invite people to play badminton with me. I wanted to make it cheap for people to join the group and so I would shoulder the cost of the shuttles and we'd only divide the cost of the court equally. Each person would pay only around 20 to 40 pesos and everyone was happy. It worked... for a while.
I then noticed that my own costs would go up as I did shoulder the shuttlecocks for the sessions. What did I do? I would go for the cheaper shuttles or we'd even use shuttles that shouldn't be used anymore for our games. There were times we would run out completely! And other times, I simply didn't see the need to organize games anymore because it did drain my own pocket.
Flash forward to the present where I belong to two badminton groups and we always split all the costs including the shuttles. This made for a fairer and more sustainable badminton playing experience and the groups are thriving. One of them can have up to 40 players during one night while the other consistently has 10 or more players every session. We end up paying more than before but more and more people want to play.
You'll notice that subsidizing anything will NOT solve any problem. Notice the same is the case with Manila's MRT which was heavily subsidized to keep costs lower for the masses. At some point, the MRT just stopped trying! If you really think about it the MRT was subsidized by the Filipino people - even those who did not use the system!
Subsidies belong to that category of nice things that sound good on paper but have bad effects in the long run. This is actually why when any senatorial candidate would mention that they would solve a certain problem by subsidizing it, alarms ring in my brain and I automatically put them in my "No" list. Now, some of them made it out as I ended up with less than 12 senators in my final list but you get the picture.
Watch out for politicians who tell you they'll solve problems by subsidizing it or by throwing money at it. I would like to think they mean well, but it simply won't do us any favors.
Thoughts and Ideas of Jon Unchuan. Ideas presented in this blog are mine alone and do not represent the ideas of any institution or corporation I'm a part of.
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