Budget blowout factor in GDP growth — Palace By Aytch S. de la Cruz 06/27/2010

‘LAND MINE’ MANAGEABLE FOR NOYNOY — ARROYO MEN Budget blowout factor in GDP growth — Palace By Aytch S. de la Cruz 06/27/2010 The spokesmen for departing President Arroyo yesterday ganged up on Sen. Francis Escudero, who seems to have touched a raw nerve when he said the other day that Arroyo is leaving not a legacy but a land mine for her successor President-elect Benigno Aquino III in the estimated P349-billion record budget blowout this year. Arroyo’s mouthpieces claimed the huge budget shortfall was the result of necessary spending to keep the economy strong, citing the supposed 37 quarters of uninterrupted growth rate that Arroyo mentioned in her farewell speech last Thursday. Escudero likened the projected huge deficit to a land mine that may impair the Aquino administration’s initial years. Two of Malacañang’s outgoing spokesmen, Ricardo Saludo and Gary Olivar, both claimed that the record deficit is still manageable given the 7.3 percent gross domestic product (GDP) posted by the country during the first quarter let alone the supposed 37 quarters of uninterrupted economic growth. Saludo said the reported P349-billion deficit should not become an issue since it is equivalent to only three percent of the country’s GDP based on the data given by the Department of Finance (DoF) and Department of Budget and Management (DBM). “In the coming years, this particular deficit would gradually be trimmed down while reassuring a continuous growth in the economy. So the data (presented by Escudero) is incomplete. Just like an ordinary critic, he is just identifying one part without providing a full undertsanding on the issue they are making,” Saludo said on radio. Saludo blamed the ballooning deficit on unexpected crises that hit the world economy since he said the government needed to spend more than its expected revenues. “If we did not push through with this [stimulus spending], we would have been one of those countries in the world that suffered from a shrinking economy last year. But if you will recall, our economy stayed strong while the rest of the economies in the world are going down. In fact, we were able to achieve 37 going on 38 years of uninterrupted economic growth,” he stressed.... MORE Source:  The Daily Tribune URL: http://www.tribuneonline.org/headlines/20100627hed1.html

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