YPS

In the grand scheme of things, I have always suspected that big business, especially the ones that require congressional franchises in particular, willingly collude with Government as a form of political pat-a-cake when it is convenient or profitable.

As an example of this friendly ball scratching, and in the case of Meralco, one of my beefs is the system loss and subsidy charges ( aside from the fact that they charge us VAT on that as well).

Looking at the current set up, where it is given that a lot of systems losses and subsidies occur at the lower economic level, you can see why government used to tolerate Meralco billing consumers not only for the subsidies but also for power stolen by squatters. This is because the good will formed by this activity (powering squatter areas) forms a loyalty with the LGUs which become very helpful during local government elections.

So Meralco gets to bill us for their inefficiencies by horse trading power to the illegally situated masses for the ability to bill us for whatever they want. Oh and don't forget what the government makes on VAT.

Unfortunately to scratch each other's balls you have to hold on to each others balls.

In this case Government squeezed first.

Unable to control rising power costs, the same people ( squatters) who government addicted to cheap, subsidized power are now being hit by higher and higher prices.

In order not to lose this ill gotten friendship , they decide to blame Meralco, who by the way, was the one who installed the power to these areas to begin with (but maybe at the "request"of LGUs for "humanitarian" purposes).

As part of the ball squeezing activities, the government pushes to lower prices but refuses to give Meralco a break in the taxes and royalties and even seeks to remove the protections in terms of system loss and other recoveries (which were approved by congress, don't forget). And they also sick lap dog Garcia on the Meralco board as Champion of the Poor and Oppressed.

So now the balls...ahem...in Meralcos court.

But of course Meralco now can't do without the systems loss charge (because the areas that Meralco was "forced" to service are sucking up to ten percent of everyone's bill).

And they cant increase the subsidy rate to 150kw/h ( to the squatters) because they will get hell from the rest of the consumers.

And they cant afford to lose the system recovery mechanisms.

What a pickle they're in. And to make matters worse, it looks like they pickled themselves too.

If anything this is a lesson on what you get for jumping into bed with the GMA government.

You end up with what looks like a cute baby at the start...then it grows up to look like Mikey Arroyo.

Yikes.