Friday, August 19, 2011

The Cha-cha-FDI myth

DIE HARD III
Herman Tiu Laurel
8/19/2011



A massive campaign has been sustained in recent months to brainwash the public into thinking that the Philippines is wretchedly in need of foreign investments. Its proponents say that a Charter change (Cha-cha) scheme to open up our already globalized property, corporate and natural patrimony rights to foreigners is now of the essence. No less than our leading legislators have aggressively pushed this, with mainstream newspapers echoing their line.

The Philippine Star, in its Aug. 16 “Cha-cha can easily triple investments” story, for instance, quoted House committee on constitutional amendments chairman Misamis Occidental Rep. Loreto Leo Ocampos as saying that “our FDIs (foreign direct investments) will TRIPLE (emphasis mine) from the current $2 billion to $3 billion once these constitutional reforms are implemented.” Well, looking at his faulty “math,” one could already conclude that Ocampos’ FDI projections will be massively off the mark, too.

In fact, the track record of “reforms” by the Philippine Congress for the past 25 years doesn’t inspire confidence at all. It is therefore quite scary that the term is being brandished again.

Consider some of the key “REFORM packages” since the Edsa I “People Power” government, beginning with the Comprehensive Tax Reform Program (CTRP) that supplanted the progressive income tax system with the regressive value added tax (VAT) set-up that transferred the tax burden to the vast majority of middle and low income consumers.

Consider the Trade Reform law passed in the early ’90s that introduced liberalization, deregulation and privatization, which are now a curse on the Philippine economy, spurring uncontrolled fuel and power rate hikes, debilitating peso fluctuations, as well as privatizations that socialize the debts but privatize the profits.

Consider, too, the so-called Electric Power Industry Reform Act (Epira) that raised our electricity rates to the highest in Asia. Aren’t these alarming enough?

Unfortunately, those impervious Cha-cha for FDI campaigners continue to call for the grant of full ownership of any and all businesses — especially land — to foreigners, as well as allowing them unlimited access to our natural resources. They have even spread their sales pitch to the Internet, using as their bogeyman the “privileged, favored and protected abusive and exploitative Filipino oligarchs” who, they say, take advantage of the Constitution’s protectionist provisions to monopolize businesses and keep out foreign capital at the expense of free market competition. What they are silent on, however, is the obvious fact that in many of these oligarch-controlled companies, foreign capitalists are the major partners of local oligarchs and, in certain cases, the ones who actually control these companies through majority voting shares.

Moreover, as these Cha-cha for FDI proponents try to draw comparisons with countries that enjoy high FDIs — notably Vietnam, Thailand, and other Asian countries — to point out that we are lagging behind due to “restrictions,” the truth of the matter is that almost all Asian (including Asean) countries are still “restrictive” or protectionist. Land property rights, in the main, are still not given to foreigners — only long-term leases. Corporate ownership is still limited — such as in Thailand, where it is only up to 49 percent, notwithstanding its latest FDI in 2010 hitting $6 billion, or four times more than the Philippines. Although Singapore is vastly more liberal, the city-state of only 694 sq. km. (having not much land for others to own anyway with five million in population) is the only exception.

As in the Philippines since Marcos’ time, most Asian countries only allow 100-percent foreign-owned companies to do business in especially-designated hi-tech, export processing zones.

One just has to look at the Asean Web site with its bundled rice stalks logo under Foreign Equity Policies to get an overview of how liberal Philippine policy already is, which I quote: “100 percent foreign equity ownership is allowed in all areas except those in the negative list under the Foreign Investment Act of 1991 as amended.” For Thailand, it states: “The 1972 Alien Business Law grants foreigners permission to engage in certain business enterprises in Thailand only if more than 50 percent of the capital is owned by Thai Nationals. However, for BoI promoted companies, majority foreign ownership is permitted for projects that export not less than 50 percent of sales.”

And while the likes of AntiPinoy.com continuously hold up Vietnam’s apparently lax foreign equity rule to buttress their point, the truth is, a May 2011 US State Department investment climate evaluation states otherwise:

“There are ownership limitations for certain companies listed on the Vietnam stock exchange and service sectors. Foreign ownership cannot exceed 49 percent of listed companies and 30 percent of listed companies in the financial sector. A foreign bank is allowed to establish a 100-percent foreign owned bank in Vietnam but may only own up to 20 percent of a local commercial bank. Individual foreign investors are usually limited to 15-percent ownership, though a single foreign investor may increase ownership to 20 percent through a strategic alliance with a local partner.”

Keep in mind that no sovereign nation will ever give away protection of its interests and concerns, and the privileges of its own people. Also know that other more important considerations, such as the cost of electricity, are what matter in a country’s investment climate.

Thus, Vietnam’s $0.05/kWh power rate is one of its main attractions; same with Thailand’s $0.15/kWh, which are a far cry from the Philippines’ $0.21/kWh. Even Bangko Sentral ng Pilipinas Deputy Gov. Diwa Guinigundo was forced to admit to a select audience that “the most difficult challenge for the national government and the private sector (is) addressing the high cost of power in the country.”

But as he and the rest of RP’s political players who are behind the extant campaign don’t say this out loud to explain why FDIs are shying away from the Philippines, they are simply pulling wool over the people’s eyes as they lie about the real reason for Cha-cha: The sell-out of the country through their many swindles.

(Tune in to Sulo ng Pilipino/Radyo OpinYon, Monday, Wednesday, Friday, 5 to 7 p.m., and Tuesday, Thursday, 5 to 6 p.m. on 1098AM; Talk News TV with HTL, Saturday, 8:15 to 9 p.m., with replay at 11 p.m., on GNN, Destiny Cable Channel 8, on “More Power Outrages”; also visit http://newkatipunero.blogspot.com for our articles plus TV and radio archives)

Wednesday, August 17, 2011

A Zarzuela of Past Errors

CONSUMER'S DEMAND
Herman Tiu Laurel
8/15-21/2011



Finger-pointing is again the order of the day.

Not long after Senator Tito Sotto challenged his colleagues Kiko Pangilinan and Franklin Drilon, believed to be two of the original collaborators of Gloria Arroyo in the cheating of 2004, to finally come clean by dropping their pretensions, was his subsequent collaboration with the alleged cheating mastermind to partake of the corrupt system also laid bare.

Similarly acting blameless while lambasting the cheats today, many of those in media were themselves part of the propaganda blitz that sustained the series of cheating and cover-ups well into 2007 and 2010.

This pattern of holding elections suffused with cheating, then eventually making an exposé out of them, has become a deftly-staged zarzuela of focusing only on the subsidiary corruption in politics to distract the people from a totally debased political-economic order.

As a result, the economic and financial corruption, particularly of the parasitic elite, is missed by many.

The past months, we built up a case against the Bangko Sentral ng Pilipinas (BSP) and the Department of Finance (DoF) for their seriously corrupt financial policies of keeping the country in debt despite the financial surplus afforded by our decades-long OFW remittances.

Such an anomaly was gleaned from the Special Deposit Account (SDA) amounting to P1.5 to 1.7 trillion and the Gross International Reserves (GIR) which total $70 billion today.

Purisima affirmation
After some controversy with BSP Deputy Governor Diwa Guinigundo over the issue, an unexpected affirmation of our position came from none other than Finance Secretary Cesar Purisima who publicly favored “the unwinding of the SDA,” which entails the reduction of interest rates to facilitate the fund’s release for domestic investments.

In fact, an Aug. 3, 2011 Manila Bulletin news story by Chino S. Leyco reported that “Purisima, who is also a member of the central bank’s Monetary Board, said… the Aquino government would be happy to accommodate (any unwinding of the SDA). He explained that by unwinding the P1.44-trillion deposits at the BSP’s special deposit accounts, it may cut the borrowing costs of the government.”

“Furthermore, the report noted, “Deposits by banks to the special deposit account facility of the BSP continued to increase in the past few years, a scenario which critics said… could have been more useful for the economy if it were invested in lending.”

Actually, when we were having consultations with former National Treasurer Norma Lasala way back in 2004-2005, she already insisted that the management of our national reserves had gone awry and, thus, wasted billions.

At that time, Purisima was already finance secretary and Amando Tetangco, the BSP chief.

Despite this, the continuity in the financial mafia remains unbroken.

Tetangco has gotten his second term for the same post while Purisima got back the Finance portfolio after a hiatus courtesy of “Hyatt 10.”

So the question is: why is Purisima only now beginning to admit the wisdom of “unwinding” the gargantuan SDA (and, in all probability, later proclaim that we can indeed mobilize a greater part of our GIR)?

Liberating step
For sure, achieving this would be a first step toward liberating ourselves from the chains that have shackled us for the past five decades. But that’s just the beginning.

The next stage is to free ourselves from ALL debt and all private bankers’ traps.

Since all credit and money is guaranteed by the taxpayer, there is absolutely no reason why the people, through the State, should borrow from any private party.

The nation should instead set up a “Peoples’ Bank” where creation of credit and money will be subject to referendum.

Now, we ask: Why was there no fanfare when Aquino III reappointed Tetangco to his BSP post when this is one of the most important jobs in the whole government?

Independent BSP
Undoubtedly, the answer lies in the fact that the BSP, as it is set up today, is actually “independent,” with the presidential appointment merely ceremonial.

And with a board dominated by private bankers, the bank decides on monetary policy, possessed of an “independent” character institutionalized by Cory Aquino’s handpicked Constitutional Commission – whose members claim is a relic of the 1973 Constitution even without basis.

Being a private bank, the BSP actually follows the workings of the US Federal Reserve and the Bank of International Settlements (BIS) where both have a public façade but with private bankers at the core (see “The Tower of Basel: The World’s Biggest Central Bank Has Private shareholders,” Global Research, July 29, 2011).

National Errors
Is there any wonder then why today the People’s Republic of China is the leading nation and economy in the world in terms of growth and stability? Its banking system is based on the concept of the “People’s Bank”, with its credit policies designed for national development and public welfare.

Of course, this is not the case for the US and its satellites--such as Europe’s PIGS (Portugal, Italy/Ireland, Greece, Spain)--now reeling from the greed and machinations of so-called “banksters.”

But sadly, our Senate, House, and financial bureaucracy – from the Bureau of Internal Revenue to the Bureau of Customs et al. – all follow the diktats of Wall Street, IMF-WB, ADB, and Basel in keeping the Philippines perpetually in debt; in taxing us more to pay it off, and in privatizing public services to create more debt (like the call for P110 billion more borrowings after 10 years of privatizing the state’s power assets).

Our past national errors, such as the ten years of fraud under Gloria Arroyo, should offer us concrete lessons in our nation’s political-economic history.

Our decision now should be to turn a completely new leaf--starting with a deeper understanding of our financial system.

(Tune in to Radyo OpinYon, Monday to Friday, 5 to 6 p.m., and Sulo ng Pilipino, Monday, Wednesday, and Friday, 6 to 7 p.m. on 1098AM; Talk News TV with HTL, on “Hello Garci: A Complete History,” with Atty. Alan Paguia, Saturday, 8 to 9 p.m., with replay at 11 p.m., on GNN, Destiny Cable Channel 8; visit http://newkatipunero.blogspot.com and http://hermantiulaurel.blogspot.com for our articles plus TV and radio archives)

August, the Ghost Month

YESTERDAY, TODAY & TOMORROW
Linggoy Alcuaz
8/15-21/2011



I heard it before but it did not stick. To Chinese-Filipinos, August is the month of ghosts. However, I always thought that the week where October 31 to November 2 fell was the very short season of ghosts.

And so, we were pleasantly surprised when researchers of a mass media organization came last week to survey our Balete Drive (Baranggay Mariana, QC) home to research on the White Lady of Balete Drive.

It used to be that ABS-CBN and GMA would come and shoot ghost scenes in our eighty-five year old house and garden as well as in the surrounding streets – Balete, Campanilla and Sampaguita – in October.

These were intended for their Halloween shows.

White Lady of Balete Drive
In fact, the lady researcher had heard about my column, “The Lady of Balete Drive” in the November 1-7 issue, # 11 of our weekly OpinYon.

She was also able to get the name of the most popular ghost in the whole Philippines, Leni Recto Garchitorena.

When I could still see and talk with former Batangas Vice Governor Ricky Recto, he confirmed to me that she was their cousin. Her mother was Maria Cristina Recto married to a Garchitorena from Tigaon, Camarines Sur.

Ricky’s father, former IBP Assemblyman Raffy Recto, owned the house that she lived in.

My friend, former Caloocan City Congressman and NAIA General Manager Romeo Santos, is married to Magdalena “Meg” Garchitorena whose family used to own thousands of hectares of land in Tigaon and neighboring towns.

Former DAR Undersecretary Pejo confirmed to us that he knew the parents of the White Lady.

We hope soon to interview someone who knew Leni when she was still alive or was related to her.

Different versions
I have heard two versions of how and why she died.

In both she met a vehicular accident.

In one she escaped from her home just to join her friends for a joy ride.

In the other she was eloping with her boyfriend. In both versions, her parents did not allow her to go out.

The story goes that she owed money to the class fund and that was why she could not rest. When her parents settled the debt, she went to rest.

Well, things are happening earlier this year. Usually, radio stations start playing Christmas carols in September.

Even that is too early for me when I‘m broke. They remind one of the bigger expenses during the Christmas Season.

Last month they started playing them already. It’s good that I’ve gotten insensitive to fears of going broke.

Ghosts and Death
Our family is also insensitive to fear of ghosts.

We consider and feel that the ghosts that reside in our home or nearby are friendly to us.

In fact, my brother Mano, who died last July 24, and I experienced the same kind of kindness from the ghost.

It opened our garden gate for us. What was the difference? He saw her. I did not, because it was raining very hard when I came home.

Other families have different experiences with ghosts and death. The Sumulong-Cojuangco clan just last month saw brother Don Pedro “Pete” Sumulong Cojuangco and sister Josephine Sumulong Cojuangco Reyes died in rapid succession.

The latter collapsed at the funeral mass of the former.

August 21
Their father, Don Jose, and Josephine’s husband, Narciso Reyes (one of the owners of the Far Eastern University) both died on the same month and day as “Ninoy”, August 21.

Ninoy had originally planned to come home on August 7, 1983.

However, then President Ferdinand E. Marcos, through then Secretary of Defense Juan Ponce Enrile requested Ninoy to delay his arrival by a month due to security reasons.

Ninoy complied halfway. He postponed his homecoming by only two weeks and not a month. That is why we have August 21 to commemorate.

Worst day
In 1980 (November), 1981 (September) and 1982 (March), I visited Ninoy three times.

Twice, I went to Boston. Once, I met him in his sister, Lupita A. Kashiwahara’s, townhouse in Pacifica, southwest of San Francisco.

During one of these trips, I saw a Vendo machine that analyzes your luck for any given day based on your birthday. I inputted Ninoy’s November 27 birthday paired with three dates, August 7 and 21 and September 5. Of the three, the best day was the 7th.

The worst was the 21st. The 5th was midway between the 7th and the 21st.

We can only imagine what would have happened if Ninoy had come home on the day he had originally planned.

Instead, he came home at the worst possible time. Marcos was in the middle of a kidney transplant. If Marcos had been in command and control of his senses, Ninoy might not have been assassinated at the NAIA.

He could have been jailed again, assassinated elsewhere or even allowed to go free.

Most probably, the situation would not have developed into EDSA I.

Without Ninoy as martyr, there would be no President Cory. Without martyr Ninoy and saint Cory, there would be no P-Noy today. Good or Bad? Without a Noynoy candidacy, we are not sure that GMA would not steal the presidency a third time. However, without a President Cory, there would not be a President GMA either. It’s getting too complicated. Let’s drop it. Let’s look for other ghosts of years past.

Another ghost
I noticed that the PNP celebrated its anniversary last Monday, August 8. I thought that the foundation day of the PNP was in January 1991, when the Local Autonomy Act was passed. This law created both the DILG and the PNP.

August 8 is the foundation day of the old Philippine Constabulary. This reminds us of another ghost from the past.

On August 8, 1970 or 1971, as Operation Bantay, under the sponsorship of the Christian Social Movement, we went to visit the burned out sitio of Ora Este, baranggay Ora, municipality of Bantay, Ilocos Sur.

In the November 1969 elections, Liberals Sergio Osmena, Jr. and Genaro Magsaysay challenged re-electionist Nacionalistas Ferdinand Marcos and Fernando Lopez and lost.

Crisologos and Singsons
At the provincial level, the Crisologos ruled Ilocos Sur. Carmeling was the governor. Floro was a ranking congressman.

Now Governor Luis “Chavit” Singson dared challenge the Crisologo monolith in the 1969 elections.

The Bulletin captured on camera a tense arms-drawn physical confrontation between Bingbong Crisologo and Chavit.

Bingbong’s goons, called saka-sakas, burned the sitio of Ora Este, Chavit’s bailiwick.

My classmate and National Union of Students of the Philippines (NUSP) president Edgar Jopson evacuated the residents turned refugees to the Ateneo de Manila Prep School near Gate 1 of the Loyola Heights campus.

Among their PC security then was future NPA rebel Lt. Victor Corpus.

After the summer vacation, we brought them back to Ora Este.

Periodically, we visited them. When necessary, we escorted them. The 554th PC Company of the 55th PC Battalion was assigned to secure them. The Supreme Court granted a change of venue of the trial to Baguio City.

Eventually, Bingbong and his cohorts were convicted and sentenced. They were sent to Muntinlupa.

Forgotten victims
However, in August 1971, the crime, the victims and the accused seemed forgotten.

To bring attention to them and bring them back to mainstage, we planned a mini rally at each of the two main political parties’ proclamation Rallies.

I was the head of Operation Bantay. On the night of Saturday, August 22, I was late arriving at our assembly place at the Plaza Lawton (now Liwasang Bonifacio).

I went ahead of our main party of about 50-100 people to cross over to Plaza Miranda. Just then two grenades exploded.

Fortunately, I was running late.

On the way to Plaza Lawton, I had stopped by the house of my colleague, Raymundo Accas Tan at Unang Hakbang in Balic-Balic, Quezon City.

I was doing some coordination and preparations for KASAPI’s first anniversary celebration on the next day, Sunday, August 22.

If I had been on time, I might have been behind the stage.

Or worse, our mini-rally might have served as a diversion and helped the grenade throwers do a better job.

Radicals and Moderates
KASAPI stood for Kapulungan ng mga Sandigan ng Pilipinas.

We had been formally organized the year before in Santa Mesa.

However, our core group had been in existence much longer. I had been recruited four years before when I started college in 1966 by Fr. Jose Blanco, S.J. and Ateneo History Professor Rolando Quintos.

Since then, we had spread out to the University Belt. We had an office in front of UST.

Almost every weekend we had live-in general orientation seminars. It was obvious we were competing with the Communist Youth and Student Organizations. They were Radicals. We were Moderates.

We were also called Christian Democrats/Socialists, Democratic Socialists and Social Democrats.

In August 1970, I had been elected the chairman.

In September 1972, I resigned in order to focus and prepare for the November 1973 national elections. These, however, would be interrupted by the declaration of Martial Law on September 21, 1972.

(To be continued)