OLIGARCHIC CRIMES UNPUNISHED: LUCIO TAN

Erle Frayne  Argonza

The politico-economic structure of Philippine reality never seems to change at all. It’s still the oligarchic system that lingers here, as it is anywhere in the planet. Oligarchs are simply in control of every strategic sector of life, both economic and political.

That’s why they are above the Law, that they can pay anything worth their pockets to meet their objectives, bribe their way to continuing hoarding and accumulation way beyond their daily needs. The Law adjusts to them, not them to the Law.

Take the case of the long-time Marcos crony Lucio Tan. Tan is almost everywhere in Philippine business life, name it and he’s there. The once state champion Philippine National Bank is in his control now, and so the former state champion Philippine Airlines. And his business concerns continue to expand, both here and overseas.

But one thing glaring about his behavior is his non-payment of taxes that date back to the 80s yet or maybe even earlier. The consummate tax evader, he is the exemplar in this regard here in Manila.

As of last year, estimates put his back tax arrears at P26 Billion. If all we know, this could be an underestimation. This could just be but the top of the iceberg, the real back taxes running probably in the hundreds of billions of pesos. We can’t say anymore. That is because documents can be doctored, and there are always ‘doctor of forgery’ everywhere including the state bureaucracy.

Perhaps we may have discovered, in the criminal behavior of oligarchs, a new universal law, the “law of the bending of the Law.” It’s like the pattern about the ‘bending of light’, this time we substitute Law for light.

Which means that Law is relative, or is of no value to oligarchs save that they serve oligarchic interests. This is true everywhere, and it won’t be long when even those colonies to be installed in other planets and the moon will face the same reality: the ‘bending of the Law’ to make oligarchs happy.

BAD GOVERNANCE AND TURBULENCE: UPDATE ON MANILA SITUATION

Erle Frayne D. Argonza

[Writ. 16 March 2008, Quezon City, Metropolitan Manila]

Good evening!

 

It’s a Sunday evening, and right now the turbulence in the country brought about by protests against huge government anomalous transactions is the hottest agenda.

 

In this country, please note that bad governance has been responsible for so much political turmoil since the 1960s yet. The Marcos and Estrada administrations were overthrown via the ‘people power way’ precisely due to people’s widespread dissent against corruption and the erosive effects of the social ailment on development efforts and poverty alleviation.

 

Today the Arroyo administration is coming under hot fire due to the same malady. The difference between the Arroyo administrations and the previous ones is that this regime had arrived at a time when urban population had outstripped rural population. The middle class enjoys not only a clear edge in opinion making, it also enjoys a predominance of the population today.

 

Thus, with the middle class pointing to a political wind of turbulence, an upsurge of mass movement and potential upheavals is again around. Unless there are clear resolutions to the ailments currently coming under hot fire, there will be turbulence and possible armed conflicts in the urban centers in the coming months.

 

In closing this briefer reflection, let me enclose my own public statement about the matter.

 

PRO-GLORIA SPOKESMAN URGES GMA TO RESIGN

 

[25 February 2008, Quezon City, Manila]

 

This gentleman, who was Spokesman of the PRO-GLORIA Multisectoral Coalition, hereby pronounces the most urgent need to save the nation from political deterioration and degeneration into the hovels of anarchy, by urging the President Gloria Macapagal Arroyo to resign her post.

 

To recall, together with many patriots then, we PROGLORIA Advocates joined the coalition in early 2004 with the values of good governance and competence among our top criteria for choosing leaders. Such values were to intersect with the advocacy for fair trade, to which GMA affirmatively supported via her line of “no to unbridled free trade.” And, hopefully, the benefits from public policies and programs would galvanize as greater social services for our marginal sectors. In the end, everybody wins from a GMA electoral victory.

 

After almost four (4) years of governing, the political-cultural terrain has become tragically murky. Civil liberties are openly violated by military & police functionaries, incompetence is endemic as the appointment of unqualified officials has been rampant,  corruption is more marked and brazenly committed, electoral reforms remain elusive while GMA herself is accountable for electoral fraud charges, and ‘free trade’ ensues with impunity while treaties that have onerous terms are being negotiated to the detriment of the national interest. It is true that the fiscal environment had been stabilized and credit standing had improved during GMA’s watch, but given the situation where her administration has become the main source of instability, it is not a remote possibility that such gains will be wiped out before the end of this year 2008. This present regime had clearly lost its moral moorings, credibility, and trustworthiness.

 

To save the nation from an impending system collapse, GMA and her team of state managers should resign en masse. This will then pave the way for constitutional processes to re-grow our most cherished values of good governance, strong institutions, greater democracy and equitable distribution of economic development gains. Public trust will then be regained, and political stability will fuel back our economic boom.

 

 

 

ERLE FRAYNE D. ARGONZA

National Spokesman – PROGLORIA (2004)

 

Quezon City, MetroManila, 19 February 2008

SOCIAL CAPITAL FOR MINING

Erle Frayne D. Argonza

 

[Note: The author is a political economist and social development consultant. The paper was delivered in a panel lecture at the Kamayan Forum, Kamayan Restaurant, 12 noon-2 pm, 19 November, 2004.]

 

 

            This paper advocates for an alternative framework regarding mineral resource extraction. It begins with the contention that mining must be considered as primarily a community undertaking, whether the community be national or local. As such, mining must necessarily depart from market-driven models of extraction, or from state-centered models of development, and proceed to a community-oriented or constituency-based engagement.

 

            To be able to comprehend the theme of this paper, let me begin with a story. About four (4) years ago, a former university student of mine at the University of the Philippines Manila informed me that a mining engineer wished to establish a (mining) foothold in the Cordillera. Accordingly, the engineer heard about my mystical background, and was interested to know if there are indeed precious metals in the proposed project site. That is, the engineer expected me to communicate directly to the invisible elemental entities in the area and ask their permission to establish a mining project.

 

            Not only that. Having heard about my background as a political economist, with diversified interest and studies in indigenous culture, the mining firm he represented wanted to know what acceptable methods to employ in flushing out the indigenous people residing in the area. 

 

            To cut the story short, I declined the offer, even as I registered my vehement opposition to the sordidly profit-oriented venture of this engineer. If mining has to prosper at all, it must begin with the reality that there are people who have been settled for many epochs in the area of extraction. A win-win solution to the mining problem must be executed, not by expelling the local residents but precisely by involving them in the venture.

 

            Let me now share to you another story. In 1998, at the height of the Asian financial crisis, my consulting firm then, the Phoenixkonsult, contracted a project with a client. The project was about yellow clay extraction, with Bicol as the project site. In a small town in Bicol is found yellow clay, a rare material that has various industrial applications as well as aesthetic uses. Incidentally, the area also has some Aeta-related residents as well as marginal peasants.

 

            Being then the board chair of the corporation, or being in a central position to direct the developmental strategies of the firm, I strongly proposed that the project involve the residents in a number of ways.

 

First of all, in the feasibility study preparation, the residents can be tapped as eco-scanners to identify possible sites where the material was highly concentrated. Also, the same residents will be constituted into a cooperative, properly trained in social entrepreneurship, and invited to be co-investors in the mining project through their cooperative. A third involvement would be to tap those residents who are physically capable enough as human resource for the extraction and production activities.

 

            Such a scheme is what social scientists and development practitioners like myself refer to as tapping ‘social capital’. Mining should not just be regarded as investment capital, but should also consider the vast wealth of social networks—‘social capital’—that can wield tremendous powers of production. Studies in comparative political economy have shown that developmental pursuits that tapped ‘social capital’ ended up more appreciably better than those that failed to do so.

 

            The development experiences of Brazil are particularly instructive. As documented by such social science luminaries as Peter Evans (see Evans’ works on ‘state-society synergy’), those projects in agriculture, irrigation and urban-based infrastructure and housing in Brazil where a state-civil society partnership was consistently used, turned out really good in results. On the other hand, those projects that were largely state-centered or market-driven and insulated from the community networks eventually faltered, as indicated by typical experiences in most Third World economies.

 

            In today’s evolving global context, state-centered development has become ridiculously passé. In this old framework, the state performs the role of a ‘provider state’—giving out everything such as candies and shelter units to helpless people waiting for the ‘Santa Claus’ dole outs. Such a framework had proved to be disastrous in results. Not only did it reinforce a strong dependency syndrome among the people, it also led to vicious poverty instead of eradicating this malaise. It need not be stressed that much money went to the pocket of state officials and contracting firms’ managers through this old framework.

 

            The new framework delimits the state’s role to that of an ‘enabler state’. In this framework, development efforts are properly the tasks of market players, who possess the investment capital, and civil society players, who possess the vast social networks of ‘social capital’. The state then builds the policy environment and strong institutions that can support and sustain various developmental efforts.

 

            I strongly contend for a ‘social capital’ approach to mining. In this approach, the first thing to do is to recognize the institutional capacity building efforts of people who live in the areas of resource extraction. Stewardship agreements must be concurred between market players and community or social enterprises of the folks, with the state serving as a mediator or facilitator. I am very optimistic about the positive results of this scheme, compared to market-driven and state-centered approaches.

 

            You see, when people, through their social enterprise groups, are motivated to co-direct development projects, the people themselves will do so much to zealously guard and monitor the entire project or enterprise venture. The bonus for indigenous peoples is that they have easy access to the spirit world, to the nature beings in the area (called ‘elementals’ by mystics), beings that can also be tapped to guard the project.

 

            Now, go back to the cranky old models (market-driven and state-centered), and remove the indigenous peoples from the scene of a gargantuan development effort. What will you have?

 

It would be instructive to recall the Celophil and Chico dam projects, both Cordillera-based, that proceeded from the old frameworks. The disastrous offshoots of the projects became the fuel for insurgent groups, largely peopled by the I.P.s, to wage zealously bloody campaigns against the colossal projects.

 

            There is no further reason today for the likes of the Celophil and Chico projects to be repeated. We must have learned lessons from their failures at this juncture. But it seems that those who now wish to revive a mining sector that has been in the doldrums for two (2) decades to go the route of Celophil and Chico.

 

            I wish not to further highlight the folly of any idea today that wishes to pursue development by expelling people like they were deadly toxins. Many advocates of win/lose pursuits are well placed in government even as they dominate the corporate sector.  They simply couldn’t see the folly behind their antiquated approaches, blinded as they are by greed.

 

            As a final statement, let me declare that the framework elaborated in this brief paper is not an official policy framework of state. Rather, it is a policy framework that should be discussed among various quarters and social sectors, the state included. The state after all comprises of a plurality of framework trends operating in a vast array of bureaucratic mechanisms. There is no such thing today as a monolithic state with a singular framework dominating the policy environment. Rather, the state is a fluid field for contestation by various interest groups that are all aiming to influence the shaping of the policy environment.

 

            But this I am optimistic about: if given a chance to prosper, a ‘social capital’ framework for mining will sell like very hot cake. I am very sure about this forecast. And may the communications enclaves allow this idea of ‘social capital’ for mining to germinate and percolate, because whether we like it or not this will be the direction of resource extraction in the foreseeable future. Bar it from crystallizing, and the result will be more resentments leading to more vicious insurgencies. Permit it to galvanize, and the whole nation becomes heroic in the eyes of the international community for setting new precedents. So, which option is the better choice?