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What Next
for the Philippines?
By Michael Alan Hamlin
January 22, 2001
President Gloria Macapagal Arroyo
mirrored the mood of the hundreds of thousands of mostly young,
middle-class Filipinos that witnessed her abrupt swearing in as
the country's 14th president on Saturday when she said, "we
must change the character of our politics." But desire and
the capacity for change are two very different things, as presidents
before her have discovered. Indeed, Ms. Arroyo's appointment of
the former budget secretary and senator Alberto Romulo as secretary
of finance glaringly demonstrates that harsh reality.
Mr. Romulo isn't the only familiar face likely to join
Ms. Arroyo's cabinet team. The former secretary of defense, Renato
De Villa, former Cebu governor Lito Osmena, Senator Raul Roco, and
Senator Teofisto Guingona are also among those topping the list
of potential appointees, including the post of vice president. Meanwhile,
Rafael Buenaventura, who heads the central bank, is expected to
complete his term, which ends in 2005.
The fact that Ms. Arroyo's first appointment draws
from the same gene pool as her predecessors demonstrates the dilemma
any Philippine president faces: Virtually all appointees come from
the razor-thin class of elites that has dominated Philippine politics
and the economy for 400 hundred years. That resource pool hasn't
expanded because prosperity — partly by design, partly neglect
— has been limited to the already affluent, despite decades
of pious promises to improve the living standards of the poor.
Choosing from outside that pool of landed elites has
proved dangerous, as the sorry spectacle of the administration of
former President Joseph Estrada so publicly demonstrated. The Senate
impeachment trial vote that gave real life to "Edsa II"
was possible because the poor — who realistically account for
about 85% of the population — elected movie stars and a professional
basketball coach, all of whom were clearly unqualified for public
office, to represent them in the upper chamber. These virtual heroes
proved to be real life heels who contributed little, if anything,
to the financial and administrative reforms the Philippines so desperately
needs.
Where the Philippines channels its resources helps
explain why the country's poor overwhelmingly stay poor. Take education,
for example. Thailand has about 10 million people less than the
Philippines, but spends seven times more on education. That accounts
in significant way why Thailand's per capita income is almost two-and-a-half
times greater than the Philippines'. Workers are better prepared
to recognize and capitalize on opportunity. As a result, growth
in private consumption in Thailand was 5.6% compared with the Philippines'
0.8% from 1980-1996.
For Ms. Arroyo, it should seem pretty obvious that
reallocating resources to boost education and reduce school dropout
rates, which are running at a dismaying 40%, should be a priority.
But after less than three years of the Estrada presidency, resources
are in woefully short supply.
In 1999 and 2000, the Philippines was Asia's largest
sovereign borrower in terms of debt securities, debt that that increased
significantly as a percentage of government financing. The national
budget deficit is projected to mushroom to about 160 billion pesos
from 136 billion pesos last year. Where will the money come from?
That takes us back to the wealthy elites. In a recent
speech to the Foreign Correspondents Association of the Philippines,
respected senior businessman Washington SyCip complained that prosperous
Filipinos fail their country miserably when it comes to paying their
fair share of taxes. The usual excuse for this shortcoming has been
that corrupt and inefficient government doesn't use its available
resources wisely. But Mr. SyCip also points out that charitable
"donations by the rich are miserably small."
While most Filipinos of all classes look to their leaders
to improve their personal circumstances, it's clear that even honest
government officials are hamstrung by limited resources of all kinds:
intellectual, financial and an elite who don't see the benefit of
doing anything meaningful for the country's poor unless they benefit
directly from the effort. These are shortcomings with frightfully
dangerous implications.
Dangerous because without redress, the Philippines
could face an endless series of people's revolutions, none of which
would necessarily have a predictable outcome. "Elected officials
have really failed us," says the respected Filipino writer
Juan T. Gatbonton. "And the next time they do, the armed forces
might not be so accommodating."
But Philippine political leaders won't be able to create
accountable government without the dedicated — perhaps even
sacrificial — support of the elites. Both Mr. SyCip and Mr.
Gatbonton suggest that this support may have to be mandated. In
his speech, Mr. SyCip said, "with our Latin background, it
is not realistic to base government revenues on self-declarations
of income." He believes that evidence of wealth — houses,
cars, trips, club memberships and even weddings — should also
be taxed.
So the question for Ms. Arroyo (herself a bona fide
member of the elite's upper crust) is not will she be different,
but can she be different? Sadly, the odds are against her.
Luckily, however, all odds are surmountable no matter
how remote the circumstances may seem, with the right combination
of political will, new thinking and an administration firmly committed
to reform. While Ms. Arroyo understandably feels beholden to the
institutions that brought her to power — the church, the elites
and the military — to be successful she must be president to
all Filipinos.
That means looking beyond the uninspired development
programs that have for the most part been a static fixture of administrations
since the time of disgraced former president Ferdinand Marcos. It
means learning, finally, the lessons of the Edsa of 1986 and vigorously
pursing Mr. Estrada and his associates so that they are fairly but
firmly punished for their betrayal of the Filipino people —
and as an example to other government officials.
It means bringing fresh blood and a new way of thinking
into government from among the activist, younger generation of Filipinos
that — more than the church, elites or military — were
responsible for the successful conclusion of Saturday's Edsa II.
It means that a sense of accountability must also be effectively
instilled in the private sector.
Most important, it means educating and helping the
poor help themselves. For if the Philippines is ever to be a great
nation, it will be on account of those who so far have been left
behind. They clearly cannot afford another dictator.
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