Maharlika fund

[PASTILAN] A Ponzi scheme called Maharlika

Herbie Gomez
[PASTILAN] A Ponzi scheme called Maharlika

Raffy de Guzman

'President Ferdinand Marcos Jr. is headed Najib Razak's way. Remember the 1Malaysia Development Berhad? The scandal is a prime example of how a crooked government can bring about its downfall.'

The government is in debt up to its eyeballs and the solution it offers is to create the Maharlika Investment Fund (MIF). Are you kidding me? That’s like trying to fix a flat tire by putting sugar on it. It’s not going to work.

When a man is drowning in debt, the most logical thing to do is for him to reduce his spending and increase his earnings. It’s a basic principle of sound financial management that has been demonstrated time and again throughout history.

But Malacañang is proposing another approach with their Maharlika fund, which is not only illogical but downright dangerous, because what they really plan to do is gamble.

They want to create a fancy-sounding wealth fund to solve our financial problems. But there is no wealth, no savings, to speak of.

This is a classic case of robbing Peter to pay Paul and trying to put out a fire by pouring gasoline on it. It’s another recipe for disaster, and anyone with a small drop of common sense can see that.

They want to fund this new scheme using money from the Development Bank of the Philippines and the Land Bank of the Philippines. These are government-owned banks that are supposed to have financial safeguards. Yet they want these institutions turned into piggy banks and risk their financial stability on a harebrained investment scheme.

It’s a Ponzi scheme, but on a national level. They’re forcing institutions to invest in something that’s still imaginary. There is no clear plan at all. Therefore, it’s likely doomed to fail, and when it does, the government will have to go begging for more money.

President Ferdinand Marcos Jr. is headed Najib Razak’s way. Remember the former Malaysian prime minister’s 1Malaysia Development Berhad (1MDB)? The scandal is a prime example of how a crooked government can bring about its downfall.

It was supposedly a strategic development company owned by the government of Malaysia. There, they created a sovereign wealth fund to boost their economy, but instead, it became a milking cow for corrupt officials, something to embezzle money from. The scandal still haunts Malaysia to this day.

The whole thing was a cautionary tale of greed, lies, and moral bankruptcy that should make anyone think twice before putting their gain above the good of the people.

The crux of the matter was the sovereign wealth fund created by Najib and his group, which was turned into a pipeline for corrupt officials and their buddies to drain billions of dollars.

It wasn’t just a simple case of mismanagement and incompetence. It was a massive failure of leadership, a case of politicians and their cronies enriching themselves at the expense of their people.

And the level of corruption was staggering. They funneled billions of dollars into offshore accounts, buying up fancy homes, yachts, and art pieces. It was an orgy of looting like what took place during the first Marcos administration. It’s no wonder it’s known as one of the biggest financial scams in history.

There was even this Martin Scorsese film, The Wolf of Wall Street, that was made using some really shady 1MDB money. That movie, which starred Leonardo DiCaprio, was about securities fraud, money laundering, and corruption. Is it just me, or does it seem a bit coincidental?

But that’s not really the true-to-life and most interesting part. The production company behind it was co-founded by Riza Aziz, the stepson of Najib. Eventually, they had to pay something like $60 million to settle a civil lawsuit in the United States concerning the 1MDB scandal. Crazy.

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The scandal was a complete betrayal of the Malaysian people’s trust and showed just how dangerous unchecked power can be.

But hold on a minute! Now, Marcos wants his version of this wealth fund. The similarities between the 1MDB and this proposed MIF are eerie, and the risks involved are no joke. We’re talking about the potential mismanagement of funds, corruption, and major financial losses for all involved.

Let’s learn from this scandal, people. The guys at the Lower House blinked already as usual. Therefore, senators need to keep their eyes peeled for corruption and greed because they can bring even the most prosperous society to its knees. They need to stay vigilant and be ready to take action to stamp out these crooks wherever they show up.

It’s not hard to see how this Maharlika fund could potentially go down 1MDB’s path. The Marcos administration is inviting people who can’t handle their liquor to a party, and when the party’s over, the government will have to go out and borrow more money to compensate for the loss of funds earmarked for governmental operations. 

It’s a concoction for financial ruin, and the only ones who stand to benefit are those who are already wealthy. Guess who suffers in the end? That’s right, you and I, the taxpayers.

If it isn’t bad enough, they want to divert the Bangko Sentral ng Pilipinas’ income to this Maharlika fund, a plan that will compromise the independence and credibility of our sole monetary authority. That would be like taking money from your savings account and putting it into a slot machine.

Can’t they see where all this is headed? Rather than build up its equity base, it will divert the central bank’s income to this Maharlika scheme.

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No wonder some senators are concerned about this whole thing, and they’re not alone in seeing that this is a clear indication that the Marcos administration has not thought this through, and they are risking a lot at the expense of our country.

They say the proposed creation of the sovereign wealth fund is generating a lot of interest, including from Japanese investors. But “how will they invest?” asked Senate Minority Floor Leader Koko Pimentel. 

And at what cost? With all the concerns being raised in the Senate now, it’s becoming increasingly clear that this is such a terrible idea.

This government should focus on addressing our financial problems, not just slapping a band-aid on a gunshot wound. They have to put in place sound fiscal policies that will address the root causes of the country’s financial woes.

Rather than create this investment fund, it would be better if they work to reduce their spending and increase revenue responsibly and sustainably.

They can start with the billions of pesos we are wasting yearly on dirty intelligence and discretionary funds for Malacañang down to the local governments.

The Maharlika fund is simply a risky proposition. The government should listen to the concerns of experts and citizens alike and abandon this misguided plan because the country’s financial future depends on it.

The country doesn’t need this. What we need are real solutions that can only come if we have responsible leaders who will make tough decisions, not by gambling but by putting our country back on the right track.

Stop playing games with our money and start acting like grown-ups. We don’t want a trial-and-error exercise. And will someone please wake Bongbong Marcos up and make him smell the coffee?

Herbie Gomez is Rappler’s Mindanao bureau regional coordinator.

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