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This PCIJ article about the Philippines no longer being a "Third World Country" and is now a "Second World Country" according to the President is indeed interesting. I know the economy is steadily growing and that income per capita is higher than three years go. However, I don't see how that makes the Philippines "Second World" or better yet "better than before".

We all know that in the Philppines, there is the top 10% (or even less) which makes in insane amount of money. Much like in other capitalist countries (and some socialist like Singapore). The majority of the middle class (comprising around 30-40%) pay the most taxes yet don't get the decent government services that they (_we_) deserve. The rest though, are living below the "acceptable level of living" or what they want to call the "poverty line".

Let's do a little math:

10% -- Higher Class :: The Taipans, Tycoons, Moguls, and Big Boss Men/Women
40% -- Middle Class :: Paid by the day/hour employees and Self-employed entrepreneurs of SME's with black bottom lines
50% -- Lower Class :: Unemployed; Self-employed entrpreneurs of backyard enterprises with red (in bold) bottom lines

So how much money will the higher 10% need to make to compensate for the rest of the 90% to make the per-capita income rise to $1,400 ? Let's try:

Let's say we have 100 people. So 10% is 10, 40% is 40, and 50% is 50. Pretty straight forward... Now let's see if we keep the income of the 90% constant: set it at $500 each. So now we see:

( .90 * Total Money Earned ) / 90 = $500

( .90 * Total Money Earned ) = $45,000

That means, 90% of `Total Money Earned' is $45,000 for 100 people. So how much does Total Money Earned have to be, so that when divided by 100 makes $1,400 ? Answer is: $1,400 * 100 or $140,000.

That means: $95,000 had to be made by 10% of the population to make it $1,400 per person! If we scaled the example to 100 Million people, that means 10 Million people earned $950 Million while assuming that 90% only made $450 Million!!!

If you can call that "Second World Economics", I'm afraid of "First World Economics" because at the trend we're going, that will mean 1% of the population will make sure that everyone else looked like they earned $2,000 per capita.



  1. Chilling indeed. I was the commenter after your comment in PCIJ and decided to check your link and the computations is very clear to grasp, even for a guy like me.
    I belong to the so-called first world or whatever that means, but to the moment I am still in the fourth world financially (all my faults though). And this is the way I see it while we can call ourselves rightfully in the first world. The last time I checked, we have a $34,000 per capita average. A single working poor can make full time an average of between 25 to 30 per anum. very close. The poverty line is drawn according the province standard and it is somewhere between $1200 and $1500 a month. Anyone not making that much can either apply for assistance or subsidized housing. Health care is universal (not to worry on that regards). Anyone incapable of working, disabled, physically or mentally over 18, is covered by complete social assistance. Those in your example of 10% must subsidized the 20 to 30 percentum of population to get close to the average. A very simple formula and I hope the Govt. of my once and still my beloved Philippines, will realized that getting up to the world ranking is as simple as sharing.


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