People think the issue of the "right minimum wage" in this Third World country, the Philippines, has been politicized? Or has it been?

Since it is election fever time, Congress approved House Bill No. 345 - increasing the minimum wage by P125 over three years - P45 in the first year (2006), P40 in the second year and another P40 in the third year. That made some pogi points for Congress persons seeking reelection from the teeming laborers of the country but Big Business objected.

GMA (who is not running for election in this midterm polls) is set to veto the bill because the NEDA (National Economic Development Authority) opined this will cause the loss of 1.4 million jobs and affirmed by the Department of Labor and Employment's job loss estimate of 1.2 million over three years due to the wage hike.

At the campaign stage platform, the Congressmen can gleefully brag before their constituent voters that they passed the wage hike bill but the Executive vetoed it.

According to the National Wages and Productivity Commission, the minimum wage (non-agriculture) for Manila is P350/day against a required family wage (6 members) of P768/day. In means two (not one) members of the family will have to work to support the minimum daily consumption requirement of a 6-member family. In Region VII (Central Visayas, to include Bohol), the minimum wage of P241/day is compared to the Family Living Wage requirement of P738/day.

A comprehensive legislated wage hike was last seen in 1989 when a P25 for workers in big firms and P20 for smaller firms were legislated. Since then, it has been the Regional boards which have been in charge of approving orders for wage increases. Some 170 of such orders have been approved by the regional boards.

The Makati Business Club had also been opposed to the legislated wage hike since, in this age of globalization, it will make some wage-sensitive industries uncompetitive in the world market. Figures released by the club that the minimum wage in Metro Manila of $7.11 or P350 is definitely higher than that of our Asean neighbors like Vietnam (US$1.25), India (US$1.97), Indonesia (US$2.64), China (US$2.94) and Thailand (US$4.87).

There is, however, a trend for stronger job protection and higher pay in the USA, Europe and Asia today. In the USA, the victory of the pro-people Democrats in Congress increased the chances of hammering out a higher national minimum wage by about 4%. In the Group of 7 Highly Industrialized Nations, activist moves for higher wages have been forthcoming due to the realization that the workers' share in the national income pie dropped to a record low of only 54% while the share going to capitalist profits went from 10% to 16%.

Many cities in China like Shenzhen and Dongguan are raising their minimum wages and unionism is actively encouraged. In Europe, many politicians are shifting from being business-friendly to being pro-labor.

Some analysts opine that many businesses in the Philippines will flounder if the P125 wage hike is implemented since 95% of the business firms here are small and medium enterprises whose profits can get easily wiped out by new labor costs.

But there are economists in the country, lets call them the Hyperwage believers, who think that the only way to increase the per capita of our country - and keep us from being permanently poor - is to give labor its true value - or reflect the real value of the intellectual and human capital.

The Hyperwagers believe that if we monetize the natural resources of the country (mining resource is supposed to run up to trillions in peso value), the per capita of the Philippines would be like that of Hongkong, Taiwan and Singapore.

Hongkong, which is one-fifth of the size of Cebu and who imports water from China is today the world's fourth largest financial center who pays their maids at home P25,000 and clerks for P300,000 per month. They are a progressive state because they pay the labor and skills at world market range which creates the magic of "purchasing power."

The so-called "slavery wages" in this country is the reason why there is little purchasing power (to buy goods) which leads to lesser business investment and creates fewer employees and therefore weakens purchasing power - in a dismally endless cycle.

According to a Hyperwage guru, the only way to make the country rich is to raise the minimum wage to P20,000 per month over 5-year period to equalize the country with the so-called "progressive" countries precisely to raise purchasing power. Unless we do this, the yearly Diaspora of overseas workers - one million left the country last year - will not stop because workers, like water will seek its own level of highest possible pay.

This high monthly minimum wage will reportedly not create hyperinflation even if this represents over 1000% improvement from the present minimum wage since goods will have to reflect the global market price otherwise smuggling (of lower priced counterparts) will eventually ease them out of business.

It is argued that Big Business goes to where the purchasing power is. That is the reason why the country does not attract them with our slavery wages that leads to poor purchasing power. High purchasing power in these places is, in fact, the reason why SM goes to Manila and not in Sulu; why Jollibee goes to America despite the high labor cost there; why SMC is in Australia and ABS CBN in Saudi Arabia.

Keeping "low wages in this country" - as an economic strategy for development for the last 100 years in this country - only served to maintain the Philippines as a Third World country - perhaps forever, without altering radically the minimum wage. There is something wrong in a country (like RP) where executives are paid 100 times better than the rank and file while in more developed countries - it is only about 10 times the difference.

A strong Middle Class with high income wages seems to be the key to prosperity in the country, one can argue.

What makes the country poor is not Education since our country's literacy rate is 95% (although the quality is questionable), not natural resources (because we are one of the world's richest) and not the ability to speak English since we are the third largest English-speaking nation on earth. Progressive nations like Taiwan, Japan and Korea do not even speak half as good an English language and not half as many as we do and have.

Is it perhaps true that low wages is the reason the country has not become rich as it can potentially be? But what is the best "minimum wage" that will not set back civilization by decades due to an unrealistic minimum wage level?

It is a very important food for thought.