Presented at the Forum on People Power and Poverty Reduction: Celebrating the Silver Anniversary of EDSA I, Institute of Social Order (ISO), Ateneo De Manila University, Quezon City  

TWENTY FIVE YEARS — a generation — have passed since the EDSA uprising cum military coup ended the Marcos dictatorship and installed a new government which promised democracy, peace, and a better life for our people.

These promises are embodied in the present Constitution – the 1987 Constitution. We cite the economic side first. In Article XII, National Economy and Patrimony, Section 1, the fundamental objectives of our economic development are laid down, namely:
1) A more equitable distribution of opportunities, income, and wealth;
2) A sustained increase in the amount of goods and services produced by the nation for the benefit of the people; and,
3) An expanding productivity as the key to raising the quality of life for all, especially the under-privileged.

How to achieve these objectives?  The same article and section states: “The State shall promote industrialization and full employment based on sound agricultural development and agrarian reform, through industries that make full and efficient use of human and natural resources, and which are competitive in both domestic and foreign markets. However, the State shall protect Filipino enterprises against unfair foreign competition and trade practices.”

A period long enough has passed and yet, we are no nearer these goals. Worse, the opposite has transpired.

Instead of an equitable distribution of opportunities, income and wealth, the Philippines is ranked as the most unequal country in Southeast Asia, based on our Gini coefficient measure (no data for Myanmar; ADB, 2007), and one among countries with a high level of social inequality (Human Development Report, 2009). The limited agrarian reform under the Comprehensive Agrarian Reform Program and now, under an extended CARP, remains unfinished with the many flaws which allow many big landholdings to escape the loop. A regime of cheap labor and contractual and informal labor has allowed profit maximization and the rate of exploitation of the workers to rise, and their rights to organize and collective action severely restricted.

Rather than achieve a sustained increase in the amount of goods and services produced by the nation for the benefit of the people, our country has suffered since 1986 a vast erosion of our productive resources and capability in industry and agriculture. The growth rate of industry has been low and irregular; that of agriculture, still lower, even dipping to zero in 2009 (NSCB, 2009). Agriculture is down to an all time low of 14.9 percent of GDP and industry, 29.9 percent of GDP. Services account for 55 percent of GDP (NSCB, 2009), a big bulk of which are oriented towards external markets and the sale of imported products.

Whatever happened to the development model of industrialization and the sound agricultural development and agrarian reform that is mandated by the 1987 Constitution for the government to implement?

The hope for a better quality of life has dimmed significantly. Twenty-one percent of families are below poverty line, with eight percent considered food poor or in daily subsistence (NSCB, 2009). Self-rated poverty ratings by SWS have placed 51 percent of families as poor and 40 percent as food poor. Hunger has appeared: 18.4 percent of families suffer hunger a few times; 2.8 percent, often. In Mindanao, moderate and severe hunger is 24 percent of families (SWS, 2010). Women suffer most in poor families.

The most damning indictment of this economics is the Filipino diaspora which has brought a staggering nine million Filipinos abroad to work or immigrate for lack of opportunities at home. They comprise a significant portion of the nation’s skilled, educated and enterprising labor force.

And yet, massive external and domestic debts have continued to be incurred by successive EDSA administrations from that of Cory Aquino to Ramos to Estrada to Macapagal-Arroyo and now, to Noynoy Aquino – all in the name of development and poverty alleviation. At the end of 2009, the country’s consolidated public sector debt amounted to P5.696 trillion (Department of Finance).

The government under Ramos started to argue that we no longer have a debt problem. Under Arroyo, this increasingly became a stock argument as if it is solid truth. The decreasing debt to GDP ratio, the rise of floated bonds and other financial instruments as new sources of debts, and the ability to renegotiate are the arguments marshaled against the ever-rising nominal foreign and domestic debt of the nation. Again, we have to ask what kind of GDP, what kind of economy has the debt-driven strategy spawned?  

This reasoning obscures the role of the huge overseas remittances of Filipino workers and migrants abroad (expected to hit $18 billion by end 2010) in propping up both GNP and GDP, and that of the legislated automatic allocation for debt servicing as guarantees for renegotiating debts and incurring new ones. The latter has caused the national government to allot 40 percent or more of the annual spending to debt service, thus limiting the urgently needed allotments for education, health and housing.

The loan conditionalities of the International Monetary Fund and the World Bank have forced on us the Structural Adjustment Program of the early 1980s and which the EDSA regimes continued to accept and deepen. Deregulation of oil and the liberalization of agriculture have caused the steady rise of food and other commodity prices and transport fares. The privatization of the power sector through the Electric Power Industry Reform Act (EPIRA) has made power rates less and less affordable for the average consumer and has given fatter and fatter profits to the power monopolies – Lopez, Aboitiz, San Miguel which has only grown against the leveled playing field promised by EPIRA. Water has followed suit in privatization.

On top of all this, we confront a much degraded environment and human settlements which can ill adapt to climate change resulting to big annual loss of lives and resources. Typhoons Ondoy and Pepeng alone cost us P207 billion or 2.7 percent of GDP in damages to crops, property and infrastructure. (WB, 2009)

By all these fundamental measures, our economy is a colossal failure and the official economics of the EDSA regimes is a failed economics. This is the tragic outcome of three major reasons. First is the stubborn insistence on the neo-liberal paradigm of dismantling the central role of the State in economic development in favor of global private enterprise and liberalized markets. Second is the failure to end the gridlock in agriculture. Agribusiness claims investments have not been bullish in agriculture because of CARP while the agrarian movements assert the government has not been decisive enough to carry out a thoroughgoing agrarian reform. The gridlock should have been long resolved in favor of agrarian reform. And third, of course, is our long colonial legacy – the absence of the concept of a national economy among the elites and the imperial clout of the United States and its G-7 partners in our economy, politics and culture.

This colossal failure is paralleled by another failure – that of the political system EDSA I put into place. The much anticipated democratic spaces – hard-won gains of the struggles during martial law – have been largely reoccupied by oligarchic families from the national down to the local level. What remained at this point are narrow and unstable ones and the legalized rights that can be asserted but with much effort and resources. Sharing of State power has taken place only among the oligarchy of super-rich and very powerful families. The Philippine State has become inclusive of all oligarchy. Now, there are more political spaces and real shared power for the Marcoses and Danding Cojuangco than all the progressive forces taken together.

Let us open up a new era for our people, especially our young who deserve a much better world. We must dismantle the neo-liberal paradigm and bring the State to its central place in economic development, and enlarge the role of the cooperative and other social sectors in the economy without denying the progressive role of the private sector. We must break the gridlock in agricultural development in favor of agrarian reform and modernized agriculture which serves the food security, the industry and the ecological health of the nation. We must break free from the twin colonial legacies of the past – the absence of the concept of a national economy and the economic, political and military clout of external capitalist powers, especially the United States.

We need new economics and politics for our people to become truly empowered, prosperous and happy. Twenty five years ago, many of our people thought these were coming. But they were to be frustrated. We must make history again – this time, all by ourselves as a people, minus the oligarchs and their global collaborators and masters.


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