POINT: THE PHILIPPINES IS A DEMOCRATIC COUNTRY, THUS ALL CITIZENS HAVE TO SAY IN APPOPRIATE STATE WELFARE DELIVERY We all

know that the overarching goal of our development efforts is to reduce poverty. Toward this end, many programs and policies have been formulated, implemented and monitored over the years. Surely there are improvements here and there, but the pace of progress just does not seem fast enough. In fact, per the MDG monitoring by the NSCB, we only have a medium probability of attaining our target to halve poverty by 2015. Why? Is something wrong with the implementation of these programs or are our poverty reduction strategies simply ill-conceived? Generally, it is believed that, for a country to be truly and sustainably prosperous there must be a broad-based middle class that serves as a stabilizing influence on society. The middle class is usually well- educated, highly skilled and well- informed. Its through an expanding middle class where we could attain political stability and real democracy. Middle class has the resources to foster economic growth and help generate employment for the poor. But so far, the poverty reduction programs we have crafted have focused mainly on being pro-poor, anti-poverty, helping the poorest provinces, etc. We seem to have completely ignored the needs of and the strategic importance of building and expanding the middle class of Philippine society. Thus, while we all agree to want to help the poorest of the poor, a strategy that pays attention to the middle class may be more effective in achieving our MDG goal to halve poverty by 2015. It is then of interest to find out what is happening to the Pinoy middle class. As of 2003, less than one in 100 families belongs to the high-income class; about 20 are middle-income and 80 are low-income. And in a span of six years from 1997 to 2003, close to four families for every 100 middle-income families have been lost to the low income category said in the study of National Statistical Coordination Board. Recently, the countrys leaders from both the public and private sectors were heard lamenting the continuing drain in the countrys brains. Indeed, officials of the Philippine Overseas Employment Administration have been saying the Philippines has increasingly been deploying skilled professionals and technicians, thus making it hard for local industries to retain talent. But unless we do something that could raise the hopes and dreams of the middle class, from which most of the countrys talent comes, we could never solve the brain-drain problem. These interventions are important because, according to the study, the mean income of the families with overseas workers is much higher by 75 percent in 2000 and 93 percent in 2003 than the mean income of all Filipino families. Out of the total number of families with one or two of their members working abroad, more than half are classified as middle-income families. These statistics reveal to us just how difficult it is to rise up the Philippine social ladder. The study is telling us that the only way for someone who aspires to get a better life is through overseas labor migration. This is a serious indictment not only of the countrys political leaders but also of the behavior of its private business leaders, who resisted policy reforms intended to hasten economic growth.

For far too long, the countrys policymakers have largely been focusing their attention on the so-called poorest of the poor, through measures like minimum-wage setting and subsidies on prices of cereals through price supports, among others. They seem to assume that the middle class is doing just fine.

The NSCB study, however, indicates that we also need to attend to the needs of the middle class for the benefit of greater society. Its from the middle class where we get the talent needed to run the bureaucracy, as well as manage businesses, offices and factories.

Indeed, it is a challenge to our development planners to do something about and for the middle class. We can no longer ignore the seemingly systematic shrinking of the group of professionals and skilled workers who can spell the difference between us being mired in poverty or crossing over to the league of first world countries by 2020. But when a big chunk of the middle class is away, the country is left to two vastly different classes: the tiny elite who have a grip on most of the resources, and the overwhelming number of the poor and wretched and their increasingly angry voices. Its an understatement to say thats not a good environment for doing business.