Bad Governance under Duterte: Massive Corruption, Gross Fiscal and Economic Mismanagement (more)

BAD GOVERNANCE UNDER DUTERTE:

MASSIVE CORRUPTION, GROSS FISCAL AND ECONOMIC MISMANAGEMENT

INCOMPLETE JUSTICE

Philippine Daily Inquirer / 05:12 AM December 29, 2018 

Lady Justice is traditionally depicted as blindfolded to represent impartiality—that politics, wealth or fame do not influence the decisions of a court of law. But in the Philippines, with its sorry state of justice, the blindfold has come to mean something else—that the judicial system willfully shields its eyes from the abuse or corruption of the law.

Consider the report about a 21-year-old man who, earlier this month, was arrested for allegedly stealing a can of luncheon meat worth P199 from a convenience store in Mandaluyong City. The man was hungry and desperate, and resorted to stealing for his food. A similar story was reported last year, of a 21-year-old sales clerk arrested for filching a can of corned beef in a supermarket in Santa Ana, Manila. The price of the can of corned beef? P31.50.

Contrast that with the cases of influential, high-profile people who are seemingly able to get away with their misdeeds involving huge sums of public money. The latest is former senator Bong Revilla, who was acquitted of plunder by the Sandiganbayan. A “consuelo de bobo,” if you will, was that he was still ordered by the court to return P124.5 million to the government. But Revilla’s arrogant response? “What will I return?”

The Sandiganbayan’s wisdom and foresight were such that it managed not only to befuddle the public with a decision an Integrated Bar of the Philippines official called “illogical, laughable”; it also left out any mention of a legal mechanism to force the money out of Revilla. Will Revilla be clapped back in jail should he fail to pay up? It didn’t say. Those millions, said the Anti-Money Laundering Council, were found in Revilla’s bank accounts at about the same time his aide Richard Cambe was dealing with Janet Lim Napoles’ bogus foundations, apparently to launder the senator’s pork-barrel funds. But in Revilla’s incredible telling, he had nothing to do with the suspect money in his very own bank accounts. And the court believed him. And now Revilla is adamant about not returning anything.

…Cesar Montano, former chief of the Tourism Promotions Board, was driven to resign in May this year following allegations that he released some P80 million to the scuttled “Buhay Carinderia” project before it even really started, and sans public bidding. Has the money been recovered, or Montano charged? The Palace hasn’t been heard from again about the matter, so consider all that gone with the wind.

Former tourism secretary Wanda Tulfo Teo also resigned in the wake of public uproar over P60 million in ads she had approved for placement in a show on state-run PTV-4 produced by one of her brothers. The conflict of interest was blinding—the kind of clear malfeasance the Tulfo brothers have no trouble eviscerating others for. But Ben Tulfo, mouthing movie dialogue not unlike those found in Revilla’s action movies, gave the country the finger thus: “Sa mga nagsasabing isauli ang pera at hinihintay daw ang P60 million, mamuti na mga mata niyo! Wala kaming isasauli (Those asking us to return the P60 million, we’re not returning anything even if your eyes turn white)!” And so nada until now—the national till made poorer by P60 million. But do the Tulfos think the people will forget?

Last month, Germany agreed to one-time reparations for hundreds of Jews who, as children, fled Nazi rule some 80 years ago. In October, Spain’s parliament approved the exhumation of the remains of the dictator Francisco Franco from the hallowed Valley of the Fallen mausoleum near Madrid, where thousands who died in the country’s civil war are also laid to rest. For these countries, reckoning with the mistakes and abuses of the past remains an ongoing, vital task—a way to heal, to learn, to ensure that such dark periods in their history do not happen again.

For the Philippines, the takeaway for the year about to close is the opposite: The likes of Revilla, the Tulfos, and the biggest transgressors of them all, the Marcoses—all of them remain unrepentant, and so the pursuit of justice against them is still accordingly incomplete. Absent such accounting, there can be no forgiveness, in this or any other year. “Forgiveness without truth is an empty ritual,” said the late senator Jose Diokno. “Reconciliation without justice is meaningless, and worse, an invitation to more abuses in the future.”

Read more: https://opinion.inquirer.net/118493/incomplete-justice#ixzz5bLRAzBPI

FIXING OUR TRADE

By: Cielito F. Habito - @inquirerdotnet

Philippine Daily Inquirer / 05:20 AM December 21, 2018

Are we living beyond our means as a country? This year so far, we bought $33.9 billion worth more goods from foreigners than we sold them. Our merchandise import bill jumped 16.8 percent from the same period last year, but our corresponding export earnings moved in the opposite direction and fell by 1.2 percent, leading to the widening gap.

Countries export so they can pay for their imports. One has to worry, then, when the former can’t keep up with the latter. While we do sell services to foreigners, too, prominently as business process outsourcing (BPO) services, even the $23 billion we earned from that sector last year still wouldn’t close the gap, which is headed to surpass $40 billion by yearend.

We need to take a much closer look at what’s wrong with our trade performance, and make it a national agenda to fix it. Decades ago, Japan, followed by South Korea, and more recently China and Vietnam, set their sights on dramatically boosting their exports, even setting ambitious export targets per industry. And they provided focused attention and assistance toward achieving the targets.

There’s no reason we can’t do the same.

…All told, we need to address the needs of the vulnerable export manufactures like chemicals and wood products, but must also work to boost our farm-based exports much closer to what our comparable neighbors earn from theirs. With farmers making up the bulk of our poor, it all makes eminent sense.

Read more: https://opinion.inquirer.net/118306/fixing-our-trade#ixzz5bggqrKyN

WHAT’S BETTER, WHAT’S WORSE

By: Cielito F. Habito - @inquirerdotnet

Philippine Daily Inquirer / 05:28 AM December 28, 2018 

…Three things are weaker this year: export earnings, overseas remittances and the foreign exchange rate, with the last being influenced by the first two. Our earnings from exports as of the first three quarters are down by nearly $1 billion, from $51.83 billion last year to $50.96 billion this year. I wrote recently of how this export decline was accompanied by a 16.8-percent surge in our import bill, leading to a widening trade gap that will top $40 billion this year from $27 billion last year, growing by nearly half.

Meanwhile, growth in remittances has slowed down further to 3.1 percent this year, from 4.3 percent last year, and both forces lead to a weakening supply of foreign exchange relative to demand. The peso decline from P50 to P53 to the US dollar—a major factor in this year’s higher inflation rate—is an offshoot of these weakening trends.

Read more: https://opinion.inquirer.net/118468/whats-better-whats-worse#ixzz5awykUORv

QUESTIONS FOR DIOKNO

Philippine Daily Inquirer / 05:08 AM January 09, 2019

House Majority Leader Rep. Rolando Andaya Jr. began the year with a public hearing in Naga City on the “questionable practices” of the Department of Budget and Management (DBM).

Among his revelations was that a fledgling construction company owned by Budget Secretary Benjamin Diokno’s in-laws and its “dummies” allegedly bagged as much as P10 billion worth of infrastructure projects allotted for Sorsogon in 2018.

If Andaya is to be believed, the company, called Aremar Construction Corp., partnered with Bulacan-based CT Leoncio Construction and Trading and seven other companies and managed to corner several juicy contracts from the Department of Public Works and Highways.

Documents obtained by the Inquirer show that Aremar was awarded P551 million worth of contracts in Sorsogon in 2018. Three road projects are in Casiguran, whose mayor is Jose Edwin Hamor. Hamor is married to Sorsogon Vice Gov. Ester Hamor, who happens to be the mother of Diokno’s son-in-law, Romeo Sicat Jr.

Diokno and the Hamors have dismissed any suggestions of impropriety. The mayor claims he did not even know the owner of CT Leoncio, and that he has no hand in the business dealings of Aremar, which lists Sicat Jr. and the Hamors’ daughter Maria Minez as among the directors.

Incredibly, according to a report in this paper, “he was neither aware that his stepson was married to Diokno’s daughter, Charlotte Justine.”

Records from the Securities and Exchange Commission, however, show that the mayor was the biggest shareholder of Aremar when it was incorporated in 2014.

Given his links to the Hamors, the issue against Diokno is evident, according to Andaya: “Clearly, there’s a conflict of interest on his part. His daughter is the legal wife of the co-owner [of Aremar].”

…In fact, because Diokno is the budget overseer, the caretaker of the people’s money no less, the matter becomes even more pointed. Yet what has he offered so far by way of explanation? On Andaya’s charges: “His accusations are illusory. The numbers are wrong and the narrative he’s selling is not grounded on facts.” To questions by House members: “I’ve served three presidents; I’m known for my integrity.”

Fine, so what then could be a perfectly commonsensical, aboveboard explanation for the fact that the company owned by his in-laws ended up bagging over half a billion worth of public projects in 2018?

The conflict-of-interest red flags raised by this case appear all too obvious — except, apparently, to Diokno, who maintains that his department could not have “favored” any contractor since it is not involved in awarding contracts or implementing projects.

More disingenuous talk; does Diokno think the public is unaware how influence and suasion, at the very least, play an ineluctable part in the government machinery? His protestations of impartiality do not clarify, but only loop back to, the main issue: How the dickens then did Aremar get so lucky?

That luck appears to be working even now, because, even while this issue cries out for an honest-to-goodness, top-to-bottom probe — not least because Diokno’s boss himself has said he wouldn’t tolerate even a whiff of corruption in his administration — Diokno has found allies willing to wave the seeming anomaly away, such as Senate President Tito Sotto.

“We have too many things on our plate to join the issues being raised,” said Sotto, as if vetting the budget — making sure every cent of the people’s money is properly and honestly used — is more an inconvenience and not the chief task lawmakers like him are mandated to do. No wonder some end up luckier than most.

Read more: https://opinion.inquirer.net/118771/questions-for-diokno#ixzz5lcb4KoXl

CORRUPTION EATS UP 15-35% OF CONSTRUCTION FIRMS’ BUDGET

Think tank’s confidential interviews reveal extent of industry problem

Philippine Daily Inquirer / 05:12 AM January 09, 2020

Construction companies allot up to 35 percent of their budgets for infrastructure projects to pay off government officials and employees and prevent them from causing any further delays, a think tank said, citing confidential interviews with industry players.

In some cases, companies have had to compromise other parts of the construction— such as the quality of raw materials—in order to accommodate the additional cost and to keep the projects moving.

In a presentation on Wed­nesday, the Reid Foundation gave a breakdown of the expenses that construction firms spent on average in putting up new infrastructure both for the public and the private sector. All the commonly disclosed expenses were there such as raw materials and labor. But the breakdown shaded a part of the graph in an ominous black, which claimed 15 to 35 percent of the expenses were spent on “other costs of doing business.” These “other costs” referred to a company’s budget for corruption as small and big companies were left with no choice but to play along in an abusive cycle that rarely gets brought to light, let alone stopped. “This is the problem that we want to address but nobody wants to talk about,” said Ronilo Balbieran, Reid vice president for operations, at the 4th Philippine Construction Industry Congress.

Reid interviewed various stakeholders in the construction industry from October 2018 to March last year to make sure the figures were as precise as possible. Balbieran deferred from disclosing who they interviewed or how many companies they talked to.

Construction companies have to maintain a net income margin of 8 to 15 percent, no matter the costs. Since the budget for a project was already fixed, other parts of the project sometimes suffered for those “other costs,” he said.

…It was not clear where Reid’s findings would lead the think tank to. While Balbieran said companies could always go to court to address the issue, individual litigation could only do so much to solve a problem that required a system-wide approach.

Read more: https://business.inquirer.net/286779/corruption-eats-up-15-35-%e2%80%8dof-construction-firms-budget#ixzz6fNj9ajwu

THE LUCKY LIGOTS

Philippine Daily Inquirer

05:09 AM January 22, 2019

So complete, it seems, is the memory loss on so recent an event that hardly anyone flinched or raised a hue and cry when the Court of Tax Appeals (CTA) ruled last week to acquit retired Lt. Gen. Jacinto Ligot and his wife, Erlinda, in a P428-million tax deficiency case. The court threw out the charges based on the prosecution’s alleged failure to present enough evidence and their improper use of the country’s strict bank secrecy laws to look into the assets of the Ligots.

“Ligots who?” was probably the question many asked themselves while scrolling through their newsfeed for the day. But just eight years ago, in 2011, the Ligots were front-page news for weeks.

Jacinto Ligot was a former military comptroller who, with his wife Erlinda, became the subject of a wide-ranging Senate investigation into massive corrupt practices in the Armed Forces of the Philippines.

The tax-evasion charges were among the cases that were thrown at the Ligots after details of their unexplained, mind-boggling wealth came to light.

In particular, as this paper wrote in an editorial following Ligot’s appearance before the Senate:

“Ligot, the military comptroller when Gen. Angelo Reyes was AFP chief of staff, was confronted with records showing that his wife traveled to the United States 42 times, and bought two houses there, one of which she paid for in cold cash amounting to $183,868 in 2002… The Ligots are said to own, in all, eight pieces of real estate in the US.”

The Bureau of Internal Revenue’s tax evasion case against the Ligots maintained that they failed to supply correct information in their income tax returns from 2001 to 2004. The couple’s properties here and abroad, added the BIR, had a total value that far exceeded Ligot’s declared income of some P770,000 as a former AFP comptroller. His wife was a full-time homemaker.

…This is the kind of avid, brazen, unrepentant corruption case that should have made for a slam dunk in court. But, eight years later, the CTA exonerated the Ligots after it struck off the record a key piece of evidence — the Anti-Money Laundering Council’s investigation report showing that the couple deposited P364.18 million in several banks and made substantial investments.

The report was disallowed because, according to the court, the prosecution had no written consent from the couple as required by the country’s bank secrecy law. (Which begs the question: Would any accused ever consent to giving out such potentially incriminating information?)

…The other deficiency cited by the court is even more jarring for being so basic: The prosecutors, it said, presented certified copies or photocopies of documents that were not adequately authenticated as required by the Rules of Court. “Documents which have been identified and marked as exhibits during pre-trial or trial but which were not formally offered in evidence cannot in any manner be treated as evidence,” the CTA pointed out.

Think about it: Government prosecutors had years to research and prepare the documents that would have clinched the case. How to explain this glaring negligence, or perhaps ignorance, of court and evidentiary rules? And who must account for what appears to be so remiss and shoddy a work that, in dropping the ball in this case, the people’s lawyers gave the Ligots exactly the lucky break they needed to squeak out of the law’s grasp?

Read more: https://opinion.inquirer.net/119042/the-lucky-ligots#ixzz5lR0W3Gah

HIDING SALNS FROM OUR SIGHT

Philippine Daily Inquirer / 05:22 AM March 30, 2019

For citizens wanting greater transparency and accountability from public officials, the statement of assets, liabilities and net worth (SALN) is an important, indeed crucial, tool to judge the honesty and integrity of any man or woman entrusted with taxpayer money.

Submitting a SALN yearly is a requirement of both the 1987 Constitution and the Code of Conduct and Ethical Standards for Public Officials and Employees. In filling out SALNs, public officials or employees declare their business and financial interests, including those of their spouse and unmarried children under 18 years old. The statement also includes a waiver authorizing the Ombudsman to secure documents from all government agencies that may show the official’s business interests and financial connections.

At the time it was first required shortly after the 1986 people power revolt, the SALN was seen as a valuable tool in extracting accountability from officials. Just a mere comparison of the net worth of an official from the time he or she began serving government would be enough to track his or her record of public service. A comparison of SALNs, it was believed, would be enough to show whether an official did (or did not) profit from government service. The SALN would also reveal: if the official was being honest, his or her ties to business interests or current or possible litigants, bidders or vested interests in areas where an official could be involved.

…And yet, despite all the easy ways to evade accountability, the SALN has proven useful in determining the fitness of some officials. Most notably, falsehoods in his SALNs proved crucial in ousting the late chief justice Renato Corona during his impeachment trial, while failure to file SALNs during her stint as a professor at the UP College of Law led to the quo warranto case that resulted in the dismissal of another chief justice, Maria Lourdes Sereno. In the latter case, the gaps in Sereno’s SALN submissions, in fact, were made the crux of the issue of integrity against her.

Unfortunately, the justices of the country’s highest court seem to have learned the wrong lessons from what befell Corona and Sereno. After the ouster of Corona in 2012, the Court issued a decision “requiring individuals who request for the justices’ full SALNs to present a strong justification for it.” Instead of a full SALN, petitioners would be allowed access only to a “summary,” which provides scant information on the justices’ sources of wealth. Recently, reiterating that internal directive, the Court denied the request by a number of parties to the full SALNs, as well as the personal data sheets, of the justices.

Not to be outdone, the House of Representatives, led by Speaker Gloria Macapagal Arroyo, has also made a move to restrict public access to the SALNs of House members, including access by the media. If the magistrates can do it, after all, why not the legislators?

…members of media requesting the SALNs of House members must submit proof under oath of media affiliation and certification of the accreditation of their media organization. Which in effect, it was noted, bars freelance journalists from getting the full SALNs. In addition, a request for access requires the payment of a fee of P300 for a copy of the document, meaning a total of P87,300 for all members of the House.

Clearly, a cloud of obfuscation and doubt now restricts not just public access to SALNs—which, it should be pointed out, are public documents—but also the entire effort to shine the light of truth on the behavior and financial records of government officials, and hold them to account for any deception or indiscretion they may commit. That the robed ones sitting in the high tribunal are in the forefront of this nefarious exercise is extremely disappointing, if not dispiriting.

Read more: https://opinion.inquirer.net/120450/hiding-salns-from-our-sight#ixzz64CC1wHsA

Bad governance, especially massive corruption, has deleterious economic effects, inevitably. If the Philippine people believe we can carry on in this manner without being impacted by disastrous consequences, they delude themselves.

THE SOLUTION: BUILD DEMOCRATIC INSTITUTIONS

Let’s be constructive. The solution to the anti-developmental political authoritarianism that obtains in the Philippines, which tends to abuse the enormous powers of the state in order to plunder the nation’s resources for personal gain, operating in a manner akin to a Mafia syndicate, is to build democratic institutions.

To cite the pointed analysis of Heydarian:

One of the greatest legacies of the Singaporean leader was to build on the strong bureaucratic tradition inherited from Confucianism as well as British imperial rule. Recruitment to government was largely performance-based and meritocratic, while corruption was minimized through a combination of competitive compensation and a tough “zero tolerance” policy.

Lee was successful as a leader largely because he both leveraged and strengthened a world-class bureaucracy that ensured rule of law, instituted optimal trade and industrial policies, and ably took care of the basic welfare of ordinary citizens. Singapore was lucky for not only having an enlightened leader, albeit authoritarian at times, but also a “strong state” that was more meritocratic and welfare-oriented than repressive and tyrannical.

And this is precisely why countries such as the Philippines have failed, because we either have had corrupt tyrannical leaders or struggling reformists bereft of a strong state. Absent capable and competent bureaucratic institutions, even the best leaders are constrained in bringing about transformative change.

In his memoirs, Lee praised the immense talent and work ethic of ordinary Filipinos, but lamented how the failures of the Philippines were because “[s]omething was missing, a gel to hold society together.” The “missing gel” was precisely the absence of a strong state that would not only hold the country together, but also steer it in a common direction toward a prosperous future.

Institutional legacy is one reason. As Stanley Karnow observed in his magisterial book “In Our Image,” “Americans neglected to establish an effective and impartial administration in the Philippines,” which forced ordinary Filipinos to place their hopes in “[corrupt] politicians instead of [a competent] bureaucracy… a practice that fostered patronage and corruption.”

Finally, one shouldn’t forget the Singaporean leader’s lamentations about corrupt tyrants in his neighborhood. In “From Third World to First,” Lee criticized the “soft, forgiving culture” of the Filipinos, since “[o]nly in the Philippines could a leader like Ferdinand Marcos, who pillaged his country for over twenty years, still be considered for a national burial.”

Lee’s Singapore shouldn’t be taken as an inspiration for authoritarianism, which has miserably failed in most countries with only few exceptions, but instead as a modern and effective bureaucracy that serves as the foundation of a functioning democracy.

rheydarian@inquirer.com.ph

Read more: https://opinion.inquirer.net/117099/we-need-a-strong-state-not-a-strongman-2#ixzz5lVapaJKu