My Arab News column for this week is The Same Mistakes Eventually. A further reflection on this past entry.
The Inquirer editorial takes a look at Suharto’s legacy. In his column, William Pesek does the same in Suharto’s corrupt legacy lives on in Indonesia, and says a lack of enthusiasm for investing in Indonesia is one of them. See Orde Baru for a timeline of the Suharto years.
Oh: and my gosh, he’s lost! Where in the world is Mike Arroyo? Maybe Austria? Lichtenstein?
A few days ago, Ricky Carandang, in his blog, said that the testimony of a new witness regarding the ZTE affair, would be used as an excuse to declare the leadership of the House vacant, and thus pave the way for a new Speaker. He predicted that the consensus candidate would be Mandaluyong Rep. Neptali Gonzales, Jr.:
When Congress resumes sessions at the end of the month, the Senate is expected to quickly resume hearings on the ZTE Broadband deal. A former associate of Romulo Neri, Jun Lozada, who was brought in by Neri as a consultant on technical matters, will provide more details based on first hand knowledge, about how the ZTE deal was clinched.
The ZTE hearings will be used by members of the House majority as a trigger to the call for a change in the House leadership. It will be recalled that it was the Speaker’s son, Joey, who accused presidential husband Mike Arroyo of intervening in the ZTE deal, thus opening a rift between Gloria Macapagal-Arroyo and JDV that never really healed.
Sources tell me that sometime after the resumption of the Senate hearings, a member of the House coalition will take the floor to ask that the speakership be declared vacant. He will supposedly have the numbers.
I’m told further that backroom talks have nearly settled the matter of who takes over from JDV.
In a response to a readers’ comment, Carandang predicted,
He’s in a position to corroborate previous testimony. He has first hand knowledge. I’m not sure what his agenda is, if any.
But whatever he has the Palace is trying its best to keep him from talking.
as I mentioned the other day, scuttlebutt was that if Speaker de Venecia’s removal is in the cards, it’s scheduled for the end, and not the start, of this year. But there are those who’d like to accelerate the transfer of power: Mindanao solons uncloak selves, bare oust-JDV plot. Or do they? It could simply be posturing to extract concessions, or as a rear-guard action to save face.
After all, the Palace could be working at cross-purposes when it comes to congressmen who want to topple the Speaker sooner rather than later. But, as the next portion of this entry suggests, if the pretext for the toppling’s removed, then people have to sound the retreat while still banging the drums.
De Venecia, Nograles draw up battle lines for speakership. Maybe. But what if, as Carandang says, neither one will be the winner?
The news today began with the breaking news, New witness backs off NBN deal probe. This, despite Senate offers witness protection to Lozada. The Philippine Star has to have absolutely the worst -because utterly useless- system for online articles, you can never link anything! So I’ll have to quote from Jarius Bondoc’s column today, without providing a link.
His column, “Lozada was in Palace meetings on NBN,” accuses Sen. Cayetano (Allan Peter) of turning Lozada, who was supposed to be a surprise witness, into a non-surprise and thus, giving the Palace time to put pressure on him. This what Bondoc wrote today:
It’s all the fault of Blue-Ribbon Committee head Alan Peter Cayetano, according to Sen. Panfilo Lacson. Lozada allegedly had wanted to tell all he knows about the deal from which kickbackers would have got $200 million, three-fifths of the contracted price. But then, Malacañang operatives got to Lozada and convinced him to shut up with a combination of death threats and blandishments, Lacson lamented. And how did Palace men find out about Lozada? Well, by Cayetano’s own admission, he revealed the name of the secret witness last weekend. He had to, he said, for transparency, since the subpoena he issued Lozada last month was a public document signed not only by him but also Senate President Manny Villar, and Mar Roxas and Rodolfo Biazon of the two other committees investigating the fraud. Cayetano nonetheless acknowledged to being the leak. He told reporters he purposely had avoided them during the Christmas break so that they wouldn’t force him to break secrecy – until days ago. And so was redefined the meaning of secret witness.
What would Lozada have revealed had he not been put in jeopardy? The answer lies in part in the testimony of Joey de Venecia III, who blew the lid off the $330-million cheating. Roxas had asked him in a hearing in Sept. if he knew a certain Jun Lozada. De Venecia said yes, and that Lozada was present in some meetings with ZTE executives, presidential spouse Mike Arroyo, and then-Comelec chief Benjamin Abalos.
Lozada was no longer mentioned after that. But Lacson and Roxas apparently continued to receive more info. Word reached them that Lozada was conscience-stricken seeing Joey and other whistleblowers lay their lives on the line while he who knew more about the high crime was comfortably silent. And so Lozada decided to talk.
The first senator Lozada approached to tell his story was not of any help. If at all, it only proved to him that some opposition figures have been co-opted, although it’s not readily seen through their pretentious posturing. That senator allegedly told Lozada to not bother testifying because the tri-committee already was wrapping up the probe and drafting a report. (Cayetano said Monday he definitely will set more hearings if new evidence turns up.)
Lozada reportedly then prepared an affidavit of what he knows. The most telling segment allegedly is about a meeting in Malacañang on Apr. 19, 2007, two days before Arroyo witnessed the signing of the DOTC-ZTE deal in China. (That’s also the day then-Economic Secretary Romy Neri told me he nearly resigned due to unconscionable terms of the telecom supply.) Luzon’s main water source would have been sacrificed, along with soldiers’ housing, just to accommodate the overpriced deal.
What else is in the affidavit, the few remaining truly opposition senators prefer that Lozada himself say under oath. They’d rather not jump the gun. Too often have witnesses recanted testimonies freely given, because Palace fixers also got to them.
This is all very tantalizing, but now moot and academic -as it has been, since Cayetano gave the Palace a free pass by wrapping up the hearings before the holidays. We shall have to see if Senate to order arrest of Lozada, Neri has any effect, and how many in the Senate will stand by their institution or cave in to the Palace.
The Business Mirror editorial points out that Congress has abandoned trying to hold the budget hostage, because it only enabled the executive department to spend without congressional oversight by doing so:
Time was, not too long ago, when lawmakers tried to put the squeeze on the Executive branch by prolonging their budgetary deliberations. Opposition senators, in particular, made the debates and discussions drag on–if only to press the point that the legislature possesses the power of the purse. Unfortunately for them, the dilatory tactic tended to backfire.
Instead of being intimidated by Congress’s authority to withhold funds, Malacañang simply resorted to realigning the previous year’s appropriations. The Executive prerogative to adopt “reenacted” budgets merely gave the Palace a free hand to dig into the national coffers–then spend billions of taxpayer pesos as it saw fit, with members of Congress unable to do anything about it save for rant and rave before the media.
As one pundit pointed out, a reenacted budget is nothing more than a huge pork barrel that Congress–intentionally or otherwise–gifts to the incumbent administration. During an election year, in particular, congressional dereliction of its duty to produce a budget often left the Palace crying all the way to the bank.
This time, Congress has managed to pass the national budget pretty much on time. Along the way, the editorial points out that one tangible benefit of the appreciation of the Peso was freeing up 16 billion that would otherwise have gone to foreign debt payments. It also praises Senators Trillanes and Lacson for saving the government 300 million pesos, the amount of the pork barrel they gave up.
But there remain some causes for concern, as these stories indicate: Budget OK ‘pleases’ Palace, but realignment veto looms. From the same article, a glimpse into the revenue-raising problems the government faces:
[S]enators put the burden on the government to boost revenue collection in order to bankroll the recently-ratified P1.23-trillion budget for 2008.
Senators cautioned that the P1.226-trillion national budget bill ratified by both chambers of Congress Monday night relies heavily on the state’s ability to finance the annual spending measure through more efficient revenue collection.
Stressing that a key element of this is “the capture of tax lost to smuggling,” Sen. Francis Escudero, Senate ways and means committee chairman, noted that “budget funds can only flow if the tax leaks are plugged.”
In order to finance the spending measure, Escudero said government must raise the corresponding amount in tax, plus P10 billion more, as the total cash budget of the government for the year is actually P1.236 billion.
According to him, the P10 billion is the projected cost of the planned 10-percent hike in the basic pay of 1.1 million national government workers that takes effect July. This amount, while factored in this year’s public expenditures, was not included in the budget. “This means that government must raise an average P3.386 billion daily to finance its operations,” he added.
The burden of raising this amount would fall on the Bureau of Internal Revenue, which is targeting to collect P844.9 billion, or 68.3 percent of total requirement, and the Bureau of Customs, whose assigned target of P254.5 billion makes up 20.6 percent of overall, or a combined P1.099 trillion.
And P75-B stimulus plan OK’d in principle; DBM balks. According to the article, Albay Gov. Joey Salceda is the guy behind the President”s stimulus package, meant to help overcome whatever economic challenges will arise from the Subprime contagion (by the way, Manuel Buencamino in his column distills what the whole mess overseas is all about):
The country’s economic managers and Albay Gov. Joey Salceda, the President’s economic adviser who presented the proposal to the President and her Cabinet that day, will meet on Thursday to study the feasibility of such a scheme and to see how it can fit into the administration’s fiscal framework.
This, amid contradictions in principles between the budget secretary and the stimulus-package proponent, Salceda…
…Salceda’s package includes P16 billion in tax rebates for middle-class working families and P8 billion in power rate discounts for those consuming a maximum of 200 kilowatt-hours per month; and increased spending for agriculture (P15 billion), food-for-school projects (P6 billion), education (P6 billion), health (P4 billion), housing (P4 billion) and infrastructure (P16 billion).
He said among the funding sources mentioned were the privatization of the remaining shares of the government in San Miguel Corp., Food Terminal Inc., and other government assets; and, for the power rate discounts, the government royalties from Malampaya…
…The proposed package is suited for a “sharp but short” US recession, he added…
…Salceda said former President Estrada took the same tack to minimize the impact of the Asian crisis on the country by releasing P40 billion for priming activities in 1999; Mrs. Arroyo released P60 billion for the same purpose to help the Philippines cope with a US recession.
“They were very successful in reversing a growth slowdown into an acceleration,” Salceda said. But Andaya said such schemes had also led to the ballooning of the budget deficit beyond what was expected: in 1999, the target deficit was P17 billion but swelled to P114 billion because of pump-priming activities; in 2002, the target was P40 billion but the deficit at year-end was over three times higher at P150 billion.
See also In rare moment, Tetangco cites fiscal concerns.
You might have noticed, above, that Salceda proposes that Malampaya royalties be put on hold. He has backing for this: Competitiveness council wants Malampaya royalties halted. To do so, however, would further endanger the precarious situation local governments are finding themselves in, because of gerrymandering.
In his column today, Quagmire rule, Juan Mercado not only says “I told you so” (he’s been a long-time opponent of creating new provinces and cities motived by gerrymandering) but points to the very real fiscal problem city governments are facing:
Mayor Celestino Martinez prints new letterheads for Bogo City in Cebu. The bill is dumped on others, including next-door Toledo City. Instead of a P307-million IRA check, Mayor Arlene Zambo will get P277 million — a hefty P31-million cut.
From Iloilo to Davao and Jolo, IRAs are being castrated sans anesthesia. Puerto Princesa in Palawan is hemorrhaging from a P144 million cut. Instead of receiving P146 million, Mayor Edward Hagedorn may get only P1.7 million. This is a policy for upheaval.
He asks, how did it happen? By juggling the figures and granting exemptions too freely and too often:
How did we stumble into this quagmire? We, Filipinos, have a nasty habit of meeting high performance standards by lowering them instead, noted Viewpoint (Cebu Daily News & Inquirer, Feb 12, 2007 ). Thus, Congress “exempted” 16 towns from criteria that other cities met.
This wont for self-delusion infects other sectors. Juggling statistics on class sizes “solved” the shortage in classrooms. Flunkers in National Elementary Achievement Tests wrestled the passing mark down to 50 percent. That wasn’t low enough. So, they wangled a “bonus” of 60 points. “This meant the criterion passing score was 37.5 percent,” Philippine Human Development Report notes. “Whom are they kidding?”
Many lost count in the frenzy to set up city halls. In 1991, we had 60 cities, many of dubious viability. By 2003, that had ballooned to 114. “National government’s ability to finance such local government units… is strained,” the World Bank and Asian Development Bank cautioned. “The small size of LGUs prevents them from generating their own resources.”
Finally, Mercado points out something long a-borning:
Migrants swap rural penury for urban penury. In 2005, six out of every ten Filipinos lived in urban sprawls. By 2030, urban residents could crest at 85 million.
In the 1980s, Rigoberto Tiglao had already theorized that the “surrounding the cities from the countryside” Maoist strategy of the CPP-NPA was doomed to fail, because even then the majority of Filipinos were urban and not rural dwellers; he ended up leaving the party because of his challenge to its political orthodoxy. I point this out because to my mind, gerrymandering and the atomization of the provinces is a grave problem.
A very curious story in Nonong Guyala’s column, Poetic justice.
And for the record, the gist of the petition various people (including myself) filed before the Supreme Court: Media ask SC to stop gov’t threats, arrests: 70 journalists sign petition vs top gov’t execs. The rationale of the case in Maria Ressa’s statement, “We Have Press Freedom or We Don’t. There is No Middle Ground.”
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