Not the future we want: 4 Marcos-era socioeconomic problems that live on

March 2, 2016

by IBON Foundation

IBON FEATURES – The late dictator Ferdinand E. Marcos’ martial law legacy figured in the various ways that the EDSA People Power uprising’s 30th anniversary was commemorated recently. What darkened this period aside from the gross human rights violations were socioeconomic woes that were compounded by the Marcos regime’s policy decisions and action. Of these, IBON lists four glaring examples that have been carried on by subsequent administrations. Today these not only have traces but are being perpetrated by the current Aquino administration in its aggressive implementation of globalization policies.

  1. Cronyism and Corruption

The Marcos regime was notorious for cronyism.  He and his cronies used key positions and plundered government coffers and other resources for their personal gain.  They took over corporations, and monopolized and profited from key business sectors. These cronies included Lucio Tan, Eduardo “Danding” Cojuangco, Juan Ponce Enrile, Henry Desini and Roberto Benedicto, among others.

For example,  Cojuangco in particular took the helm of the Philippine Coconut Authority, a government agency, and the United Coconut Planters Bank (UCPB), the funds of which he used to buy and gain control of San Miguel Corporation. Henry Desini meanwhile facilitated several anomalous transactions for the Marcos government including the overpriced Bataan Nuclear Power Plant (BNPP) with a US$80 million bribe from the American firm White Westinghouse. Government-assumed loans of the National Power Corporation (Napocor), which reached US$795 million, also reportedly enriched Desini.

Like his predecessors, Aquino has used both legislative and presidential pork barrel funds to benefit and influence politicians.  Despite Supreme Court decisions declaring both the Priority Development Assistance Fund (PDAF) and Disbursement Acceleration Program (DAP) as unconstitutional, Aquino managed to retain vast presidential pork barrel in the 2016 National Budget by adopting a loose definition of savings authorizing the transfer of DAP-like funds and through large lump sums. These will allow Pres. Aquino to use funds at his discretion. Aside from letting favored legislators identify billions of pesos worth of public works projects in their districts, the approved budget also reportedly has Php408 billion in special purpose funds and 68 billion in unprogrammed funds. Aquino’s closest friends also hold cabinet posts such as old friend and legal counsel Paquito Ochoa who is executive secretary, campaign manager Butch Abad who is budget secretary, former private water firms heads Rogelio Singson and Jose Almendras who were appointed public works and highways and energy secretaries, respectively, and agrarian reform secretary Proceso Alcala who remains so despite corruption allegations against him.

Aquino also favors rich allies and their foreign counterparts by awarding them public private partnership (PPP) contracts. The total cost of 12 PPP projects awarded under the Aquino administration is Php217.4 billion, huge chunks of which were bagged by the Ayala Group, the Pangilinan-Salim Group, Henry Sy and Danding Cojuangco. Foreign corporations involved in big PPP contracts are US’ Mirant, Sithe, California Energy; Japan’s Marubeni and MRTC; and other companies in UK and Germany.

  1. Labor Export Policy

Marcos also started the government’s labor export policy.  It began as a temporary measure in the 1970s to stave off high unemployment and earn much-needed foreign exchange to pay off the country’s mounting foreign debt.  The 1974 Labor Code or Presidential Decree (PD) 442, PD 1412 of 1978 and establishment of the Philippine Overseas Employment Agency (POEA) facilitated how labor export became a lucrative business venture for private business and the government as overseas workers were made to pay exorbitant placement and recruitment fees, including processing of papers. Overseas annual deployment grew over ten-fold from 36,035 in 1975 to 372,784 in 1985.

Aquino has only intensified this labor export policy despite promises at the beginning of his term to create jobs at home and guarantee the welfare and protection of overseas Filipino workers (OFWs).   Today, his administration has the biggest number of OFW deployment since the labor export policy began under Marcos.  In 2014, 1.8 million Filipino workers or 5,021 workers per day were deployed which is more than double the number of new domestic jobs created.

  1. Onerous Debt

Under the Marcos regime, the country’s foreign debt ballooned from US$599 million in 1966 to US$26.4 billion upon its downfall during the first EDSA People Power 30 years ago. Marcos was known to have accumulated huge debts especially within the Martial Law period between 1973 and 1982. A big chunk of this was the mothballed US$2.3 billion BNPP which turned out to have been overpriced by US$600 million. A bigger portion amounting to US$3.3 billion went to government-assumed loans of Marcos cronies. Marcos was also reported to have pocketed up to 33% of total Philippine borrowings under his term.

When the debt level became unmanageable, the Philippines was compelled to undergo restructuring under International Monetary Fund (IMF) advice. The country never recovered from its fiscal woes, however, with Filipino taxpayers having to pay the debts of Marcos until 2025. Topping these, Marcos issued PD 1177 or the Budget Reform Decree of 1977 automatically appropriating part of the national budget for debt servicing. This remains in place until today. Foreign debt under the current Aquino administration as of late 2015 has reached US$76 billion.

  1. Plunder of natural resources

Marcos also promoted the rampant plunder of the country’s natural resources, which led to environmental degradation.  The plunder of Philippine forests was unprecedented under Marcos.  He used timber licensing agreements (TLAs) to reward his cronies such as Tomas Alcantara, Jose Yao, Felipe Ysmael, Juan Tuvera and Simeon Ventura other than the Disinis and Enriles.  TLAs increased from 58 in 1969 to 230 in 1977. According to Kalikasan, from 1965-1986, the Philippines lost 7 million hectares of forests under Marcos.

Implementation of the Green Revolution under the Marcos regime increased the use of inorganic fertilizers and pesticides, which contaminated water systems and farms. Pesticide importation increased fivefold in only six years under the Masagana 99 program, benefiting agrochemical transnational corporations. Marcopper Mining Corporation’s open-pit mining, which would later in history unleash more than three million tons of hazardous waste into the rivers of Marinduque, began under the Marcos regime. This and mega dams such as those along the Chico and Magat rivers were among the regime’s destructive economic activities that threatened farms and indigenous ancestral lands then.

Aquino continues this plunder and environmental degradation.  Through Executive Order (EO) 23, the Aquino government imposed a total log ban in natural forests.  However, this did not categorically ban commercial logging, and merely prevented the Department of the Environment and Natural Resources (DENR) from granting new contracts while reviewing existing contracts.  The government’s recent mining policy EO 79, merely reinforces the Philippine Mining Act of 1995 and demands greater government shares from mining revenues instead of decisively putting a stop to big local and foreign corporate mining plunder.

All these have aggravated the state of the nation as joblessness and underemployment continued to swell while agriculture and industry’s contribution to the economy shrunk. The people and the economy bore the brunt of Marcos’ socio-economic blunders and still do, as subsequent administrations catered to the neoliberal framework of prioritizing business interests over people’s welfare.–IBON Features