THE WORLD appears to have reached an unprecedented era of ruthless and merciless capitalist speculation as can be gleaned from oil prices spiraling out of control. The phenomenon threatens to engulf in particular developing countries in what should be modern waves of slavery and misery, perhaps reviving the slave market of old save that the slave traders have reincarnated into today’s “oil traders.” While before the market had traded black slaves, now through “black gold,” developing economies are indentured and enslaved.
There have been many explanations for the unstoppable increase in oil prices: the inability of the Organization of Petroleum Exporting Countries (Opec) countries to produce more petroleum; lack of refining capacity; growing consumption of China and India as a result of their rapidly industrializing economies; and geopolitical threats in the Middle East and Africa, among others.
But all of these are explanations that merely serve to fuel speculation. In the meantime, developing economies are reeling from the effects of the galloping price increases. In the Philippines alone, inflation has zoomed to a nine-year high of 9.6 percent; the peso has dipped to an eight-and-a-half-month low of P 44.4640 to $1; and import costs have increased dramatically, resulting in a gaping four-month trade deficit of $2.6 billion.
The inflationary impact of oil price increases is particularly punishing for the ordinary Filipino. Food inflation is peaking at 14.3 percent, with rice price inflation skyrocketing to 31.7 percent, and fuel, electricity and water consumption rates seeing an 8.2 percent upswing.
Recently, the government has announced subsidies to the poor to combat the adverse effects of inflation: P500 power subsidy for lifeline users; quarterly fuel subsidies for the public transport sector; fertilizer subsidies for farmers; and even educational grants to children of poor families, to name a few.
But in order to fund these subsidy programs, the government is set to borrow $750 million from the international debt market, which a former budget official, economist Benjamin Diokno, has described “a show of desperation.” The new borrowing would only add to the nation’s sovereign debt burden while fuelling the speculation that drives global oil prices to wayward heights.
Perhaps a more pressing but practical move is for the Philippines to ally itself with other countries similarly displaced, and to bring to the attention of international forums the sufferings of poor nations like it as a result of the criminal speculation of oil traders and dealers and those in cahoots with them.
Indeed, manifold sins grease the storyboard of our latter-day Dante’s Inferno. On the one hand, greed breathes through the mouths of oil-price speculators and corporate thugs. On the other hand, there are governments that play the populist card by extending tokens and rations to their impoverished populations, using resources contracted from international loans that merely adds to the debt burden and plays into the hand of speculators and profiteers.
But as Oppenheimer oil analyst Fadel Gheit declares, oil-price speculation is a “crime” because a “family of four is going to have to cut corners to benefit a Wall Street trader who makes $ 20 million a year.” Who is going to check such a crime perpetrated in the altar of the free market?
What’s happening buttresses the Catholic Church’s historic critique of liberal capitalism and the free market. The late Pope John Paul II, like the popes before him, had condemned the “idolatry of the market” and reaffirmed “the primacy of the human being.” “There are many human needs which find no place on the market,” he wrote in Centesimus Annus. “Even prior to the logic of a fair exchange of goods and the forms of justice appropriate to it, there exists something which is due to the person because he is a person, by reason of his lofty dignity.” Amid the merciless speculation of the oil market, we must reaffirm the dignity of the human person. We should all work together against shadowy figures who seek to make a profit at the cost of the human person.
