Duterte and the oligarchs

I heard an interesting story in the coffee shop about an ambitious Chinoy from Davao who supposedly approached Bobby Ongpin and offered to buy PhilWeb for a ridiculous sum. This was before Duterte came to office and Ongpin was making so much money from PhilWeb. So he just waved the Chinoy away.

A few months before the last presidential election, the same Chinoy went to Ongpin again and made the same offer, but increasing the amount somewhat. Again, Ongpin laughed and all but shooed him away. So the Chinoy remarked, “It is alright because soon I will own PhilWeb.”

 A few months after Duterte became president, people were surprised that the first oligarch he attacked with some vigor was Bobby Ongpin. Well… Bobby is surely up there, but to many he hardly evoked the image of an oligarch even if he had always acted like he believed he was one. He isn’t even among the very top taipans in the Forbes list.

PhilWeb is still not operational even after Ongpin sold his shares to Marcos son-in-law Greggy Araneta. The Davao Chinoy has not stepped into the picture in a very obvious manner but maybe it is just a matter of time. He is in the list of top contributors to the Duterte presidential campaign and it seems the president recognizes utang na loob contrary to what he said during the campaign.

Indeed, the impression is that the Duterte administration isn’t exactly against the oligarchy. The President only hates the Manila-based oligarchy. He is replacing them with his own from Davao.

This is why we Filipinos should consider ourselves lucky that the mistresses of a top Davao politician and a Davao oligarch supporting Duterte fought. Otherwise, we wouldn’t have known how badly the national coffers have been raped for decades by a sweetheart deal involving prison land being leased for peanuts to grow bananas for export.

Now Duterte will have to act against a Davao oligarch who was also his top campaign contributor. Indeed, Duterte’s sincerity will be tested by this case. We will soon know if his bark against blood sucking oligarchs has bite. Or if he only bites oligarchs he doesn’t like.

Sure… we will laud Duterte if he is able to finally recover land that used to be Napocor right of way from a Manila-based oligarch family that also happens to own one of the major newspapers. I have the highest respect for the journalists working in that newspaper, but it is obvious past presidents tiptoed in dealing with the owners about this.

Mad as Erap was with the newspaper and its owners, the most Erap could do was a boycott of movie advertising against the newspaper. He should have gone after the newspaper owners on what looks like a flawed land deal whose lease had expired long ago. That’s how to distinguish between press freedom and business interests.

Will Duterte have the guts to do better than Erap? This we have to see.

As we approach the first anniversary of Duterte’s presidential term, it is timely to remind him he was elected president by an angry Filipino people who are tired of being abused by society’s heartless elite. Even I thought he would be just the man who has what it takes to go against the oligarchs and give every Filipino his just share of the country’s economic wealth.

Respected economist Cielito Habito clearly described our economic inequality in an economic forum some years ago. Ciel presented data showing that in 2011 the 40 richest Filipino families on the Forbes wealth list accounted for 76 percent of the country’s gross domestic product (GDP) growth.

This is why P-Noy and his economic team only elicited eye rolls every time they exalt their supposed accomplishment of record breaking GDP growth rates. Then they realized how inequitable the situation is and they started talking about inclusive growth without really doing much to make that happen.

Imagine that… 40 families cornering 76 percent of our GDP growth. And I am sure they don’t even pay their just share of taxes.

This shameful ratio was the highest in Asia. Ciel pointed out that in Thailand, the top 40 accounted for 33.7 percent of wealth growth, 5.6 percent in Malaysia and just 2.8 percent in Japan.

Indeed, the two wealthiest people in the Philippines, according to the Forbes 2012 annual rich list, Henry Sy and Lucio Tan, were worth a combined $13.6 billion or six percent of the entire Philippine economy. In contrast, about 25 million people, or one quarter of the population, lived on $1 a day or less in 2009, which was little changed from a decade earlier.

The oligarchs have been sucking the blood out of our economy for a very long time. Many of the elite families have dominated since the Spanish colonial era. The Ayalas and Aboitizes control large chunks of the economy to this day and it seems, forever.

They essentially got their capital from ridiculously large land grants given by the Spanish colonizers and accumulated profits from businesses through generations. These gave them a big head start to control major industries from property development to banking and telecommunications.

The Chinese taipans started growing their businesses after WW2 and have overtaken the Spanish mestizos. Together they constitute the country’s oligarchy.

Their stranglehold on the economy can be attributed to a compliant government whose regulations allow and protect the monopolies our oligarchy controls. Congress and a succession of presidents have been beholden to them at the expense of the rest of the population. Thus, the sharp and shameful social divide!

A study by the Philippine Institute for Development Studies, a government think tank, observed that despite wide-ranging reforms since 1981, big chunks of the market remain effective oligopolies or cartels. Ciel explains that the path to riches for the few is also helped by a political culture that allows personal connections to easily open doors.

What we have seen so far are occasional anti-poverty programs that smack of tokenism… crumbs to appease the hungry masses. Spending about a billion dollars on a Conditional Cash Transfer program to help bridge the rich-poor divide is even criticized as wasteful.

I participated in a discussion of the first year of the Duterte administration with leading Filipino analysts recently. We agreed that we’ve never had a real democracy precisely because only a few have controlled economic power.

This is why it is so important for Duterte not to forget his promise to cut the oligarchy down to size. I am afraid it is so easy for the ruling elite to co-opt him as the power of the presidency begins to intoxicate him.

Hopefully, he doesn’t just replace the old oligarchs with new ones from Davao. That will lead us to exclaim, uy naman Mr. President, pareho din yan!

Boo Chanco’s e-mail address is [email protected]. Follow him on Twitter @boochanco.