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The transport strike was successful in most parts of the country. Thousands of drivers and operators of buses, jeepneys and tricycles opted to join the protest to dramatize discontent over government inaction on runaway oil prices.
As expected, government officials downplayed the impact of the strike by highlighting the normalcy of Metro Manila traffic. Yet they dispatched hundreds of military trucks and suspended the traffic color-coding scheme, which proved that the strike succeeded in paralyzing transport operations in the country. Schools suspended classes and offices closed early as public vehicles began to disappear from the streets in the middle of the morning.
The protest action achieved tactical victories. The Senate immediately conducted a hearing to check if recent oil price hikes were justified. Two senators proposed the suspension of the VAT on oil products for six months to ease oil prices. The energy secretary vowed there would be no more oil price increases for the rest of the year. President Gloria Macapagal-Arroyo ordered government agencies to monitor if oil companies are overpricing their commodity.
The transport strike forced Congress to review the oil deregulation law and compelled the executive branch to check the profiteering schemes of oil companies. If not for the strike, oil companies would have continued to raise oil prices every week for the rest of the year.
Another achievement of the strike, which was not highlighted in mainstream media, was the formation of a consumer alliance against oil price hikes. For the past years, transport groups were almost alone in protesting oil price increases and the deregulation of the downstream oil industry. In last week's protest, transport groups were joined by consumer networks and people's organizations.
Usually, the government is able to persuade leaders of rival transport groups to belittle the necessity of conducting transport strikes. Last week, there were major transport groups which didn't join the strike but at the same time they didn't reject the soundness of protesting against oil price hikes. In fact, they were also demanding that the government control oil prices and repeal the oil deregulation law.
Another bit of bad news for the government is the threat of all transport groups, whether left-leaning or not, to conduct another transport strike early next year if the government continues to do nothing against new rounds of oil price hikes.
These are extraordinary times and the government should implement bold measures to keep oil prices stable. Aside from the transport sector, the government should protect the welfare of consumers. Oil price hikes affect the economy in a negative way. They increase production costs, which lead to a production slowdown, which triggers unemployment, which reduces consumer spending, which then lowers the country's tax base. No wonder many groups are aghast over the government's meek approach in regulating oil prices.
It isn't enough for politicians to preach about energy conservation. Oil imports and actual consumption have been decreasing over the years, yet oil prices continue to rise. The government should seriously consider the three demands of consumer and transport groups.
The president can certify as urgent the passage of a bill which will repeal the oil deregulation law. A decade of deregulation allowed the unrestrained escalation of oil prices which guaranteed the super profits of oil companies at the expense of poor and middle-class Filipinos. The Philippine case shows that oil prices registered the biggest increases not during the Gulf War in the early 1990s but after the downstream oil industry was deregulated in 1996.
Deregulation assumes that free market mechanisms will make the oil industry competitive and thereby reduce the prices of petroleum products. But this is wishful thinking for an economy where three multinational oil companies dominate the local oil industry. These three big firms, not the market, dictate oil prices in the country.
Government intervention has become more than necessary today. It can impose a moratorium or rollback of oil prices, punish oil companies for overpricing, and it can become a major player in the industry by buying back a former state-owned oil company which was sold to foreigners.
But politicians are reluctant to reverse the deregulation policy. They refuse to stop oil price hikes since collection of VAT from oil products, shouldered mainly by poor and middle-class consumers, is a big source of corruption. Big business and fat bureaucrats are united in the pauperization of the Filipino people.
There are other options available to control oil prices. The government can enter into commodity-swap agreements with oil-producing countries. Centralized procurement of oil products can be initiated to prevent a distortion of the oil supply.
The current mantra of the government is renewable energy. Biofuel is hyped as the miracle product which can lower oil prices. But more and more scientists are worried that focusing on biofuels could jeopardize food production.
Renewable energy will never lower fuel prices as long as the government's deregulation policy is in effect. The government continues to privatize power and energy assets, which could make the push for renewable energy a futile endeavour. Haven't we learned from various privatization programs that when profit-seeking private companies are given monopoly control of a vital industry, the welfare of consumers will not be given the utmost priority?
The recent transport strike manifested the willingness of transport groups and consumer organizations to use extreme measures against successive oil price increases. Unless the government decides to implement reforms, more and more people and groups will be further radicalized in the future.
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(Mong Palatino is a Filipino youth activist, news editor of Yehey!, a Philippine-based web portal, and a Global Voices correspondent. His Web site is www.mongpalatino.motime.com, and he can be reached at mongpalatino@gmail.com. ©Copyright Mong Palatino.)
