The return of the Sugar Bloc

From Barons, Brokers, and Buyers: The Institutions and Cultures of Philippine Sugar , as originally quoted in this entry of mine from 2006, Planters and millers:

…Many in the sugar industry persist in the belief that they are among the most powerful political forces in the nation. But those with real power consider that claim laughable in today’s Philippine sugar economy. More political capital can be gained from disparaging the “sugar barons” than from advancing their interests.

And yet, in their efforts to portray the Philippines as a neo-colonized, exploited, and “feudal” cog on the periphery of the global world capitalist system, many Philippine scholars have missed or understated this important trend… scholars have conveyed the impression that the old rural oligarchs have preserved their preeminence in unabated form, or at least that all Philippine elites are pretty much alike in how they relate to the state. Journalistic accounts… are even more stark in their portrayals. For them the Philippines is a “changeless land” and a “land of broken promises,” dominated by fabulously rich rural elites able to direct political life unfettered by competition from other elites with other values and unconcerned with the greater national good…

I am not claiming that those perspectives are entirely mistaken, only that today’s Philippine reality is far more complex. Where rural elite families have managed to maintain their status and power, they have done so by adapting to radically different circumstances, by making new alliances, and by using their wealth and influence to pursue different strategies of gain. Those oligarchic families who have clung to the older methods of wielding influence have largely ceded ground to the nouveau riche. Most important, urban businessmen and financial wizards have increasingly become the dominant reference groups for ambitious young people. One would be hard-pressed today -even in Negros- to find a young member of a planter family who would admit to aspiring to a life of rural leisure and inherited “success”…

Although patrimonial capitalism endures in the Philippines, I argue that the shift from landlord dominance to the dominance of urban businessmen is critically important as a harbinger of future change in politics, economy, and culture. While it may appear at first that all Philippine elites are alike, that elites from different sectors pursue different strategies of domination and advocate different sorts of policies has consequential implications.

Many on the Philippine left see signs that the next “ruling class” will consist of former peasants or proletariat. But it seems far more plausible, given current trends, that what is evolving is the more typical historical progression: replacement of an old elite class by a newer one with different interests and sources of power, even though many of the individuals and families are the same. Despite the many works decrying the static composition of Philippine elites, and the bipolarity of Philippine society, I argue that this shift is affording an unprecedented amount of upward mobility and the rapid growth of a Filipino “middle class.”

That historic progression is still taking place, but let me put forward a portion of Benedict Anderson’s 1988 essay, Cacique Democracy in the Philippines: Origins and Dreams:

Immensely confident of Anglo-Saxon world hegemony and the place of English as the language of capitalism and modernity, the colonial regime effortlessly extruded Spanish and so expanded an English-language school system that by 1940the Philippines had the highest literacy rate in Southeast Asia. After independence, the oligarchy, like other Third World oligarchies, found that the simplest way of establishing its nationalist credentials was to expand cheap schooling. By the early 1960s university degrees were no longer a ruling class near-monopoly.

The huge expansion of English-language education produced three distinct, politically significant, new social groups. Smallest was a radical intelligentsia, largely of bourgeois and petty-bourgeois urban origins, and typically graduates of the University of the Philippines. Among them was Nur Misuari, who in the later 1960s formed the Moro National Liberation Front in the Muslim southwest. Still better known was José Maria Sison, who broke away from the decrepit post-Huk Communist party to form his own, and, borrowing from the Great Helmsman, founded the New People’s Army which is today a nation-wide presence and the major antagonist of the oligarchy. (The spread of English, and, later, of ‘street Tagalog’, in nationalist response to American hegemony, has made possible an archipelago-wide popular communication – below the oligarchy – that was inconceivable in the era of Bonifacio or the Hukbalahap.)

Next largest in size was a bien-pensant proto-technocracy, which also included graduates from American universities. Drawn from much the same social strata as the radical intelligentsia, it was enraged less by the injustices of cacique democracy than by its dilettantism, venality, and technological backwardness. This group also deeply resented its own powerlessness. When Marcos eventually declared Martial Law in 1972 and proclaimed his New Democracy, it flocked to his standard, believing its historic moment had come. It stayed loyal to him till the early 1980s, and long remained crucial to his credibility with Washington planners, the World Bank and the IMF, and foreign modernizers all and sundry.

Largest of all – if not that large – was a wider urban bourgeois and petty bourgeois constituency: middle-level civil servants, doctors, nurses, teachers, businessmen, shopkeepers, and so on. In its political and moral outlook it can perhaps be compared with the Progressives (definitely not the Populists) of the United States in the period 1890–1920. In the 1960s it made its political debut in campaigns for honesty-in-government, urban renewal, crackdowns on machine and warlord politics, and the legal emancipation of municipalities and the new suburbs. As might be expected, this group was both anti-oligarchy and anti-popular in orientation. Had it not been English-educated, and had not President Kennedy secured a major change in the American immigration laws, it might have played a major role in Philippine politics in the 1970s and 1980s. But these factors offered it enticing alternatives, such that, by the mid-1980s, well over a million Filipinos (mainly from this stratum) had emigrated across the Pacific, most of them for good. This bourgeois haemorrhage in the short run weakened a significant political competitor for the oligarchy, but in the longer run cost it an important political ally – one reason why the Aquino government has so little room for manoeuvre.

The Marcos regime, which began to entrench itself long before the declaration of Martial Law in 1972, was an instructively complex hybrid. From one point of view, Don Ferdinand can be seen as the Master Cacique or Master Warlord, in that he pushed the destructive logic of the old order to its natural conclusion. In place of dozens of privatized ‘security guards’, a single privatized National Constabulary; in place of personal armies, a personal Army; instead of pliable local judges, a client Supreme Court; instead of a myriad pocket and rotten boroughs, a pocket or rotten country, managed by cronies, hitmen, and flunkies. But from another viewpoint, he was an original; partly because he was highly intelligent, partly because, like his grotesque wife, he came from the lower fringes of the oligarchy. In any case, he was the first elite Filipino politician who saw the possibilities of reversing the traditional flow of power. All his predecessors had lived out the genealogy of mestizo supremacy – from private wealth to state power, from provincial bossism to national hegemony. But almost from the beginning of his presidency in 1965, Marcos had moved mentally out of the nineteenth century, and understood that in our time wealth serves power, and that the key card is the state. Manila’s Louis Napoleon.

In this extract he points to the origins of the middle class and a factor missed out, above: that the reformist middle class was gutted when American emigration laws were liberalized. Anderson thinks it took place in the 1960s-1970s; it may be that the initial decimation took place, then; but a large enough chunk remained to matter in 1986; but as I’ve pointed out elsewhere, since the 1980s, it was further decimated in the 1990s to date; and what’s left has clung more and more ferociously to the Old Guard as it tries to forestall losing power in the face of a population which has reaped the failures of the Old Guard but refused, or been unable, to exact its pound of flesh -because it can go overseas like the middle class has been doing since the 1960s…

But whether or not you subscribe to Billig’s view that the old provincial nabobs have given way to a new class of merchants and managers, or to Anderson’s (earlier) views, or even my assertion that the old middle and upper classes have been decimated but have managed to retard the rise of a replacement class culturally divorced from them, the process of evolution of not outright reform, at least in one respect, seems to have stalled.

Back in 2006, apropos the stalled peace process, I blogged about an observation made by Paulynn Paredes Sicam:

She observed that the past twenty years has seen the disappearance of a “peace constituency” and that the urgent task at hand is to rebuild one. To this end, she appealed to the media to devote attention to peace developments, and to bear in mind that sensationalistic, or utterly cynical reportage can have a tremendously harmful effect on the prospects of peace, and be quite damaging to peace prospects in particular localities. She also said t[h]ere are many inspiring stories that are never reported or superficially reported: cases where communities rise up, and basically tell both government and rebel troops to get the hell out and leave them in peace -and then, maintain that peace.

As it is for human rights, so it is for almost everything else: the disappearance of so many constituencies formerly so vibrant and even powerful.

Add to this list the obvious weakening of the land reform constituency. The best it could muster was a kind of kamikaze mission the other night: Commotion erupts at House of Representatives.

To be sure, land reform hasn’t been a major priority of the present administration. There has been the usual speechifying in favor of it, but the President certainly hasn’t gone for broke in terms of spending political (or any other kind of) capital to accomplish it. See Land redistribution slowest under Arroyo presidency. But neither Aquino (who herself came from a landed family) nor Ramos (who did not), actually targeted the big estates. Both administrations redistributed more middle class land and then public land, than actually breaking up the big estates -and only those big estates of families willing to give up their lands, and not the richest and most valuable estates whose owners actively resisted land reform.

The other day, in his blog, Rep. Ruffy Biazon pointed out the administration at the very least, went through the motions of corralling support to put the renewal of CARP over the top:

In fact, aside from the certification which is an official act, more personal efforts were taken to ensure the cooperation of congressmen. Last Tuesday, the Presidential Legislative Liaison Office individually reminded congressmen to attend sessions and stay until its passage. Likewise, the Office of Speaker Prospero Nograles sent text messages to the Members of the House, urging them to be present during session and not leave until debates are concluded and a vote is taken.

It is not the first time that such persuasion was used on congressmen. The Anti-Terror Bill, the R-VAT Bill, and many others were passed with the same kind of prodding from the Office of the President and the Office of the Speaker of the House. While other bills languish in suspended animation, there bills which enjoy the active support of the leadership, to which members of the majority are all too willing to accommodate.

But there was a palpable lack of enthusiasm among administration allies. Biazon says that if the previous Speaker fell, among other reasons, for failing to muster quorums, then it bodes ill for the new Speaker that he doesn’t seem to be doing much better:

So with the President’s certification of the bill and the leadership change still fresh in the House, it was expected that the CARP extension bill would not encounter difficulties in passing. Although debates have been going on for almost three weeks owing to some lengthy interpellations by a few congressmen, it seemed that yesterday was going to be the last day for debates. There were several congressmen lined up to ask questions, including myself, but the intention was to go overtime if needed, just so that the bill would come to a vote.

We have also done that many times, conducting marathon sessions stretching one day to the next, just to give everyone an opportunity to ask questions and yet have the bill voted on as soon as possible.

At first it seemed that the congressmen were going to maintain the pace and close the deliberation of the bill and finally vote. But as the night wore on and the debates became longer, the numbers began thinning. At around 8:00 PM, one congressman from the administration coalition suddenly stood up and questioned the quorum.

It was obvious then that there were not enough numbers of congressmen in session. The proceedings were suspended and the quorum bell rang, calling all congressmen to proceed to the hall. Proponents of the bill tried to convince the member who questioned the quorum to reconsider his position. But he stood firm, and eventually the session had to be adjourned.

And as subsequent events have shown, it has to be asked, just how genuinely, did the administration bat for the House giving CARP a lease on life?

The Inquirer reports House defers vote on CARP extension bill: But resolution extending LAD until December OKd, and some rather peculiar suspicions on the part of at least one frustrated member of the House:

Akbayan party-list Representative Risa Hontiveros-Baraquel, one of the principal authors, however, said that the “landlords” in “collusion with leftist solons” from the Bayan bloc were out to block the passage of the bill, or water it down.

The fate of the proposed legislation hangs in the Senate because the senators are bucking its approval until the DAR submits a full accounting of the CARP funds for the past 20 years.

“There’s no CARP without the Senate… There can be no law without the Senate,” Nograles said.

Now the point isn’t whether some sort of unholy alliance is at work, but rather, we are facing the revival of a political force long thought extinct since the days of Martial Law: the Sugar Bloc. You can read, entirely free, on-line, John A. Larkin’s Sugar and the Origins of Modern Philippine Society:

In the end, sugar created a native elite, prestigious and powerful who, despite their disparate provincial origins, acted together with the collusion of foreigners to shape the course of Philippine modernization. For more than a century and a half, sugar represented the most important and influential sector of an insular commercial life that this elite, with rare exception, exploited almost exclusively for their personal advancement. Their conspicuous consumption contributed not so much to the progress of the islands as to the outflow of cash and to the inequitable colonial economy. Among sugar workers the maldistribution of profits created not a consuming public but permanent pockets of poverty, and attempts to ameliorate their circumstances came mostly to naught.

But even the book’s snapshot, of moribund sugar mills, of limited successes for cooperatives, has changed:

The post-Marcos era has commenced in the Philippines, and Nasutra has gone the way of other martial law aberrations; however, world economic conditions have prevented significant recovery for the industry. The U.S. market, too, promises to remain a finite one for Philippine sugar, given pressure from America’s own sugar producers, the demands of its other offshore suppliers, and the fact that its biggest food producers, including large bottlers Pepsi and Coca-Cola, now increasingly use corn sweetener in their products. Even if future Philippine sugarmen improve their productivity, they will have to depend for their livelihood on insular consumption and limited exports. The World. Bank reports the industry’s export earnings for the present as “stagnant,” and there seems little prospect of revival.

The book was written before the expansion of regional economies, and of ethanol and the modernization of the industry: the creation of a New Sugar Bloc.

The New Sugar Bloc has some of the old (though still fairly new, in that they’re Marcos-era) faces of the Old Sugar Monopoly of the New Society, but in its behavior it’s more like the pre-martial law Sugar Bloc in that it has strategically, and effectively, managed its bloc in Congress regardless of what the chief executive wants (or in collusion with the Palace, which is a possibility, too). And triumphant, too: in Negros (Bacolod, for example), the reformist clergy I met are no longer young; and the priests and future bishops who will replace them, no longer imbued with the same focus on Social Justice.


Skip to comment form

    • KG on June 14, 2008 at 9:30 am


    So, your question is if we will also use sugar for bio ethanol?

    We have a biofuels law signed.Of course we have to consider all the corncerns of each concerned group or interests of each interesest group.

    laws are signed, some how implementation is always an issue.

    come on leytenian, you know that.even if you have been busy working your ass off before being an active cyber surfer,maybe you know how laws are said you left RP 18 years ago, you know how things are run then,ganun pa din. tapos some laws here are similar like your question on suing the government, I searched about it and I saw that you can find your answer in your adaptive state of florida.

    • leytenian on June 14, 2008 at 9:49 am

    “Another way to look at this is how many in the Filipino elite are philantropist and undertake social work for the improvement of standard living of the majority poor considering the Filipino millionaires, even billionaires who joined the Forbes list?”

    another way of looking at this is how many of the filipino elites’ second or next generations are entreprenuers who can employ our people… in my understanding of older elites, their young ones have grown into a drug addict, draining all their assets by relocating overseas, have house there and here ( investment is not for the purpose of true business) some become politicians who doesn’t have a clue on how to manage a much bigger generations except continously managing their own…

    a true rich individual will always have some kind of social organization or philanthropy organization for two reasons: tax deduction ( up to 1 million us dollar a year tax deduction) or simply generous.
    in philippine taxation, how much is the maximum peso donation allowed for tax deduction in a year ? ( income of 10 million pesos a year for example)

    • leytenian on June 14, 2008 at 9:58 am

    “laws are signed, some how implementation is always an issue”

    of course…i understand.. let me assume then two reasons why implementation is slow and worst than gradual reform:
    1. we don’t have financial resources because our debts are way too high
    or maybe invested into something else.
    2. issue of implementation might be the cause of lack of knowledge and fear of the unknown. ( common)

    randam na randam ko talaga… LOL

    • hvrds on June 14, 2008 at 10:57 am

    How does one have a class struggle when those classes do not exist in Philippine society.

    The Philippines never evolved and passed thorugh a feudal society. There was never any well founded feudal kingdoms in the country similar to China, India and the most of Europe.

    The first attempt to impose a kingdom was done by now deposed King Ferdinand and deposed Queen Imelda.

    Communal tribal societies do not make for feudalism.

    So waht we got was a tranplanted Spanish feudal system run by Friars and integrated by the Chinese merchant trader. In the trading enclave that was Manila it was the Chinese that brought with them the artisanal skills.

    Tribes had their won artisans to weave cloth and make primtive tools and weapons.

    So the Philippines developed through trade with their colonizers. Mainly resource based trade. So the elite of sciety were always the established comparador/trader/ banker.

    Even the landlords were dependent on them.

    It was the chinese assimilation with Spaniards and Filipinos that brought forth the eltire class of this country. Mainly merchant traders and light manufacturing. – Tobacco and booze.

    Since the artisanal class was very raw you did not have well established built up cities much less roads when the outsiders came in.

    A tropical archipelago with nothing built up except the rice terraces.

    So how do you expect to build up an industrial base when the artisans and alchemists are missing.

    Countries whose indigenous peoples were subjugated and not allowed to evolve on their won are ususally lost.

    Our ancestors reached the point of using hand made crude machines of wood and fiber to make their own clothing. But they were barefoot.

    How do you make those woodcarvers from Paete and Ifugao into industrial artisans to hand shape molds for manufacturing?

    Yup it was the Spaniards that discovered the Philippines. There were too few natives so far in between the islands that could pose no objections and the small group of Chinese, Arab and Indian traders trhen that knew of the islands.

    • UP n student on June 14, 2008 at 11:04 am

    to cvj: You may have missed it, but Malacanang is pushing CARP with as much attention as it pushed the Anti-Terror Bill. Rep Ruffy Biazon notes that :
    …In fact, aside from the certification which is an official act, more personal efforts were taken to ensure the cooperation of congressmen. Last Tuesday, the Presidential Legislative Liaison Office individually reminded congressmen to attend sessions and stay until its passage. Likewise, the Office of Speaker Prospero Nograles sent text messages to the Members of the House, urging them to be present during session and not leave until debates are concluded and a vote is taken.

    It is not the first time that such persuasion was used on congressmen. The Anti-Terror Bill, the R-VAT Bill, and many others were passed with the same kind of prodding from the Office of the President and the Office of the Speaker of the House.

    • UP n student on June 14, 2008 at 11:31 am

    And it is noteworthy, but I don’t know how Abe Margallo and cvj will feel — this observation that emigration (be it permanent — ala Abe Margallo — or temporary (maybe) — ala cvj ) has decimated the “conscience” of the Philippines, hence, weakening the clamor for the social-justice causes (like CARP) that Abe and cvj proselytize about.

    • cvj on June 14, 2008 at 12:35 pm

    Karl, not everyone is in agriculture and not all land is used (or can be used) for farming so it’s not a matter of dividing 30 Million hectares by 90 million people. Also, around half of Filipinos live in urban areas where agrarian reform is not applicable, hence the need for urban land reform as well.

    Did you notice the pattern in the discussion…

    1. When we were discussing urban land reform (a few days ago in a previous thread), those who are opposed to it say that the urban poor should instead return to the provinces.
    2. Now, when we are discussing agrarian reform, those who are opposed to it say that there is not enough farm land for everyone.

    So here you have a set of policy recommendations where the Filipinos who are poor are being driven from the cities and yet are still forced to stay and work in someone else’s land in the provinces. In the meantime, you have a handful of families and foreigners owning hundreds or even thousands of hectares and who congratulate themselves for their (or their great grandfather’s) ‘hard work’.

    Remember that movie Independence Day? Many in the Filipino Upper and Middle class are starting to sound like that alien who was captured by Will Smith’s character.

    • rego on June 14, 2008 at 1:39 pm

    Now, when we are discussing agrarian reform, those who are opposed to it say that there is not enough farm land for everyone.


    in this kind of discussion, maybe it would help if we research on the following
    1. how much agricultural lands do we have that can be covered by CARP?

    2 How many families h currently owned more than a hundred hectares
    3. how much land is being occupied by foreigners that can be covered by CARP.
    4. How may farmers do we have that can avail of the program.

    Ill see what can I coem myself by going to DAR website

    • rego on June 14, 2008 at 2:07 pm

    Ok here is one link

    Number of Farms with Livestock and Number of Livestock Reared or Tended as of March 2003 by Type of Livestock and Region: Philippines, 1991 and 2002

    Number of Farms with Poultry and Number of Poultry Reared or Tended as of March 2003 by Type of Poultry and Region: Philippines, 1991 and 2002

    Number of Farms with Other Agricultural Activities by Region: Philippines, 1991 and 2002

    Number of Agricultural Operators by Age Group and Sex, Philippines : 2002

    Number of Household Members of Agricultural Operators by Age Group, Sex and Whether Engaged in Agricultural Activity or Not, Philippines : 2002

    Other Index of Agriculture and Fishery Statistics

    2002 SCENARIO of the

    Number of Farms Increased in 2002 by 4.6 Percent

    Agriculture is as equally important as the other economic sectors of the country. Agricultural activities play an important role in economic sustainability and development of the country. The agriculture and fishery sector contributed 15 percent of the Gross Domestic Product (GDP) in 2002, amounting to P595.6 trillion at current prices. The country�s leading exports included agricultural products such as coconut oil and fresh bananas, which contributed a combined total of $661.5 million FOB (free on board) based on January to December 2002 compilation of Foreign Trade Statistics, NSO. Moreover, based on the results of the October 2002 Labor Force Survey (LFS) of the NSO, the agriculture sector alone absorbed about one-third of the total employed persons.

    In 2002, the Philippines registered a total of 4.8 million agricultural farms, covering 9.7 million hectares. The total agricultural land area constituted 32.2 percent of the country�s total land area. Although the number of farms was 4.6 percent higher than the 4.6 million farms reported in 1991, the country�s total farm area decreased by three percent after a period of more than one decade. The decrease in total farm area could be attributed to the conversion of farmlands to residential and commercial purposes. As a result, the average farm size declined from 2.2 hectares per farm in 1991 to two hectares per farm in 2002.

    • rego on June 14, 2008 at 2:17 pm

    another link:

    Tenancy rates in the countryside range from 50 to 70 percent. Just like other marginal farmers, tenants – whether sharecropping or leasehold – have to contend with a rural élite which not only enjoys a monopoly in land resources, but also single-handedly controls the distribution of technological inputs, rural banking, the renting out of farm machinery as well as the storage, transportation, processing and marketing of farm produce. Taken as a whole, marginal farmers, tenants and farm workers total 10.2 million, 70 percent of whom are landless.

    • rego on June 14, 2008 at 2:21 pm


    Total agricultural land as of 2002 = 9.7 millions hectares
    Marginal Farmers, tenants and farm workers = 10.2 million

    • d0d0ng on June 14, 2008 at 2:31 pm

    In essence, agrarian reform has become irrelevant:
    1. Agrarian lands are declining (converted to industrial lots).
    2. Uncontrolled population growth, thanks to powerful Catholic bishops.
    3. Lawmakers who spin the Agrarian Reform many times are themselves landholders with family self-interest.
    4. Farmers are largely left to market forces without price support from the national government while foreign and big corporations are getting business incentives and tax breaks.

    • d0d0ng on June 14, 2008 at 2:55 pm

    In essence, agrarian reform has become irrelevant:
    5. Government “ping-pong” economic policy of importing rice to keep the price low drive local farmers out of rice farming business.

    • cvj on June 14, 2008 at 3:13 pm

    Thanks for that Rego. Here are some earlier discussions as well…

    (The above links in turn to an earlier discussion where you participated in.)

    In this thread from last month, with UPn’s help, we got information that seems to point to smaller farms being more productive.

    • UP n student on June 14, 2008 at 7:53 pm

    d0d0ng: Point number #5 is Malacanang’s response to urban-poor versus rural’s. The policy is to buy-from-overseas to (subsidize the urban-poor) by driving down the price of rice. USA-, Japan- and EU agricultural policy is the reverse — their policy is designed to keep the price-to-their-domestic consumers HIGHER than it should be. [Of course, USA-and-others also send food-stamps to the very poor so their poor don’t get hurt that much.]

    It seems silly (but urban-poor versus rural’s causes it to happen) to driving down the price of a commodity by buying from overseas.

    • UP n student on June 14, 2008 at 8:22 pm

    actually, USA-, Japan- and EU-agricultural policy is designed to keep their farmers in the farm by blocking out sugar (USA) and rice (Japan) or cotton (EU, USA) from entering the domestic market. So the urban consumers pay a higher price in order to “make the farmers happy”.

    Of course, this is because in the USA, Japan and the EU, their farmers have a strong lobby.

    • UP n student on June 14, 2008 at 8:48 pm

    to cvj: What I talked about earlier is NOT “…where the Filipinos who are poor are being driven from the cities”. I was talking about (number 1) people (urban landless and any and whoever) illegally-occupying other people’s properties should be removed from that property switffly;
    (number 2) to think about Mainland China policy (permits and other “stuff” needed) designed to slow down the rural migration into Beijing and Hongkong; and (number 3) delivering more educational- and health-programs to rural areas.

    • UP n student on June 14, 2008 at 9:11 pm

    And JOBS should be the issue, shouldn’t it, not entitlement to one’s own house/lot or one’s own farm? Isn’t the better program “… to teach how to fish” ?

    • jmd on June 14, 2008 at 9:52 pm

    Some things I learned when participating in discussions:

    1. Agree to disagree
    2. Disagree without being disagreeable

    Making sweeping, unsupported statements tend to be unproductive and will only provoke divisive responses. Being a newbie in weblogs, I try to participate in topics where I feel I can make relevant contributions and hopefully find answers to my own questions.

    I guess, old prejudices die hard.

    BrianB, “CARP hemorrhages money because it makes compromises. Dapat di na kayo bayaran or utang lang muna.”

    What little land I have, I purchased through savings from my 9-5 job. I did not inherit a single pot of soil. I am still paying amortization for my house and lot. IF ANYONE WANTS TO COME AND TAKE IT FROM ME, I WILL SERVE HIS HEAD ON MY PLASTIC DINNER PLATE!

    cvj, “You’re the ones with enough wealth to look beyond your families’ needs and do what is good for the country.”

    Thank you for the confidence. But you are referring to the past generations. I would like to go into Industry, but somehow, banks want to lend only to people who don’t need the money. Don’t you notice?

    History makes good reading. Nice stories about the pioneering spirits makes me feel that there is hope for the future of my children if given the chance. Sad stories about oppression and exploitation makes us realize that we have to work a little bit harder so we leave behind a world, a little bit better than when we came in.

    Coming from Negros, I have taken enough ribbing to take jokes in stride; “gina pala, gina piko”, an old tale referring to piles of money. I will take issue, however, when sweeping statements reflecting old prejudices continue to be resurrected.

    Supremo, “The problem is the feudalistic attitude of the landowners. Ang tingin nila sa tenant farmers alipin na pwedeng ipamana sa anak nila.”

    I think this was a theme from an old Rogelio de la Rosa movie.

    Times have changed. The new rich in the enclaves of Alabang, Corinthian, White Plains, BF Homes and similar gated communities have more resources and fatter bank accounts than the few landowners left in the provinces. This is where the new generation of powers that be come from.

    I would like to believe, that the new generation of Filipinos are sensitive and socially relevant. We have to give it a chance. We need solutions. Continuous “bitching and faultfinding” will get us nowhere.

    • leytenian on June 14, 2008 at 10:09 pm

    “So the urban consumers pay a higher price in order to “make the farmers happy”. Of course, this is because in the USA, Japan and the EU, their farmers have a strong lobby.”
    true, which is actually a good policy. we buy our own. when did we start importing?

    Indonesia ( hurting their own) But in 1998, in the wake of the 1997 economic crisis, state intervention in rice production and distribution was no longer considered a ‘pro-poor policy’. As part of its crisis ‘bail-out’ loan, the International Monetary Fund (IMF) imposed many conditionalities including in matters that were related to food security.

    are we following what IMF telling us what to do? I bet we do…
    My understanding of protectionism :
    The repudiation of that debt should be the starting point of any genuine effort at national independence and sovereignty. Such a campaign could well serve as the catalyst for a nationwide coalition that would complete the unfinished revolution.

    I think Gloria is paying a lot on our debts. 70% goes to debt service and 30% goes to social services… if this is the case, the farmers and the poor must be educated to farm again… ( rapid reform)

    • leytenian on June 14, 2008 at 10:22 pm

    one policy for reform will hurt another policy’s reform… problem solving skills from our experts are required. this is where statistics, economics, and financial statement must be used to look at data from the past, current ( global and domestic) then its outcome for the future. the picture should always consider pro-poor. Our economy cannot sustain if we leave the poor behind.

    • cvj on June 14, 2008 at 11:35 pm

    Disagree without being disagreeable…I WILL SERVE HIS HEAD ON MY PLASTIC DINNER PLATE! – jmd

    You may be a newbie to weblogs but i think you’re quickly getting the hang of it.

    I would like to go into Industry, but somehow, banks want to lend only to people who don’t need the money. Don’t you notice? – jmd

    Yeah i noticed. That’s part of the missing industrial policy that i was referring to. Development banking (along with local-content management and selective seclusion) is supposed to be one of the key functions of the Developmental State, which the Philippines is not.

    One thing the government should be doing is to encourage the OFW’s to channel a portion of their remittances to a local retirement fund which can then be funneled into a Development Bank which makes loans for local manufacturing.

    • Bencard on June 14, 2008 at 11:57 pm

    “so i’m leaning towards corporate farming and entrepreneurship . wag na lang yung land reform hindi na practical. ” rego

    i agree with you & jmd @10:20 pm (6/12).

    let’s not forget that, assuming they have sufficient capital, most of our small farmers and tenants neither have the entrepreneural spirit (or necessary business acumen) nor interest in modern large-scale agricultural enterprise as a corporate agricultural industrialist would have. the era of do-it-yourself farming for household or local consumption is passe.

    general foods, general mills, kraft, tropicana, among others in the u.s, are what they are because of vast landholdings that enable them to have vital impact in world economy. and they employ lucratively a great number of people, including “farmers”.

    • cvj on June 15, 2008 at 12:14 am

    Bencard, the productivity metrics of corporate plantations clash with the need to find jobs for rural folk. These agricultural industrialists would not hesitate to substitute a tractor for a human hand if their number crunchers say so since increasing shareholder value is their priority, and not human (or community) development. Also, with the determination shown by the Sumilao farmers, i think you’re underestimating the spirit of small farmers and tenants.

    • BrianB on June 15, 2008 at 12:19 am

    “What little land I have, I purchased through savings from my 9-5 job. I did not inherit a single pot of soil. I am still paying amortization for my house and lot. IF ANYONE WANTS TO COME AND TAKE IT FROM ME, I WILL SERVE HIS HEAD ON MY PLASTIC DINNER PLATE”

    Well done, now you realize how unfair it is for landgrabbers to enjoy their lion’s share without working for it while the rest of us toil for scraps.

    • Bencard on June 15, 2008 at 12:35 am

    cvj, it seems to me that your “rural folk” are getting less and less in number because most are flocking to the cities or leaving for abroad as ofws. i think most of these folks are offspring of tenants or small landowners and have no interest in farming with some willing to parlay their 2-hectare tubigan for a shanty in manila or a slave master’s den in jordan.

    the point is, leave farming to those who can do it most efficiently and productively.

    • leytenian on June 15, 2008 at 12:39 am

    “One thing the government should be doing is to encourage the OFW’s to channel a portion of their remittances to a local retirement fund which can then be funneled into a Development Bank which makes loans for local manufacturing.”
    sounds good but complicated. Any bank will still require a business plan and projected income statement. It’s a standard. There’s no such thing as 100% financing. Any entrepreneur must have at least 20% or 30% capital or asset as collateral. Today, anyone can always go to any Philippine bank as long they have 30% of cash and documented other current income to service the 70% remaining debts while the new business is slowly growing. I would say, there’s a need for business consulting to service our new and young enterpreneurs in our country.
    The government will enhance and promote an independent agency to aid, counsel, assist and protect the interests of small business concerns, to preserve free competitive enterprise and to maintain and strengthen the overall economy. Small business is critical to our economic recovery and strength, to building our future, and to help compete in today’s global marketplace. The bottom line mission must be to assist Filipino to start, build and grow businesses.

    A thorough assessment of an entrepreneurs track record of small business experience must be considered. New comers without business experience but with cash flow from OFW relatives must seek consultation and assistance from either private entities or government independent agencies. Lots of information including population study,income, competition and many factors affecting business success.

    Small business ( really small-start up) will employ one and will eventually employ many .

    • cvj on June 15, 2008 at 1:03 am

    Bencard, it’s true that by now, there may be more people in our cities than in the provinces, but thanks to our rapidly increasing population, there are enough rural folk left. The point is not to focus on efficiency alone or for its own sake, but to help the local farmers become more efficient so that they can accumulate the domestic purchasing power needed to support industrial development. And remember that what we are aiming for is not just economic growth but also human development. The two objectives are related and mostly complementary, but not the same.

    Leytenian, if i may add, the OFW funded Development Bank should not finance just any business but one that aims to replace imported goods with locally produced ones. As such, the government should have a plan on what industries to encourage and put up the necessary trade barriers to stack the deck in favor of those local businesses in that industry. The objective should be to develop local production capability so that we can eventually wean ourselves away from the need to deploy OFW’s.

    • leytenian on June 15, 2008 at 2:51 am

    the word OFW Development Bank is actually a good name to start. What’s the barrier of an entrepeneur to get licensing to open this type of bank? Just go to SEC and register? This new bank should not be owned by any politicians of more than 10%. OFW do not trust politicians or even our government. They will not deposit their money. This is solely an independent bank. No government attach or conflict of interest but of course will follow government regulations. There must be a contract to prevent the government from taking over for long term stability. The more banks offering competing interest rates is actually good for our economy.

    “The objective should be to develop local production capability so that we can eventually wean ourselves away from the need to deploy OFW’s.”

    aahhh, i think this is what we are good at, a service provider to the world. It helps for now. The rest of our economy needs to grab outsource labor.. example call center and any manufacturing plant in the technology sector. This policy does not require a lot of capital from our government except to allocate certain incentives for trade and tariff only for this type of industry. As I have mentioned before, free rent and contract provisions are types of incentives . The key here is mass employment. When there’s employment, revenue from taxation will increase and will help pay down debts and more budget for social services. easy said than done… but it can be done.

    • leytenian on June 15, 2008 at 3:55 am

    going back to agrarian, i don’t care who owns the land. if employment is generated so be it. if self sufficiency is achieved so be it.. for now, the result is not quite understood. as far as i’m concerned. i bought a land from a tenant ( agrarian land). not sure if the money he received will last his and his family’s lifetime. but the point is, he has money for now that he would never have gotten if he has remained a tenant. life ‘s too short.. the wealth has been distributed fairly. now , i don’t know what to do with the land….LOL

    • KG on June 15, 2008 at 8:52 am

    What ever happened to GMA’s meetings with de sotto,………..

    GMA, De Sotto discuss means on how to empower poor Filipinos
    Saturday, September 20, 2003

    In seeking to make life easier for millions of poor Filipinos, President Gloria Macapagal-Arroyo met Friday with one of the world’s renowned development economists, Peruvian Hernando de Soto, to discuss measures needed to empower the poor.

    The program has always been an important part of the President’s vision to empower the poor in the Philippines so as to leverage their extra-legal real estate and business holdings.

    The President said De Soto’s work as outlined in his best seller, “The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else,” provides important inputs for her vision and programs to fight poverty and increase economic growth.

    De Soto, author of the best-selling The Other Path (1989) and founder/director of Peru’s Institute for Liberty and Democracy, is a champion of market economics and property rights in a part of the world that historically has shown little interest in such ideas.

    His promotion of the idea that minimizing regulation can unleash the entrepreneurial spirit of the poor has made him a popular figure in right-wing and libertarian circles.

    Until 1992, he was personal representative and principal adviser of former Peruvian President Alberto Fujimori, whose authoritarian rule collapsed in a corruption scandal in 2000.

    De Soto’s idea is to give the poor certain rights to property they make use of frequently but don’t own—like a dwelling in the slum. This way, they can raise capital by selling those rights or use them as collateral in the formal financial system.

    The De Sotto principle is being used as the basis for the government’s move to allow farmers, particularly the beneficiaries of the land reform program, to use their farmlands as collaterals for loans.

    Since the 80s and 90s, De Soto has argued that the poor sit on huge sums of “dead capital.”

    Primarily, this is in the form of dwellings – an estimate in 2000, he said, putting the implied value of this at around $100 billion in the Philippines.

    De Soto said that the poor run businesses as well but they do so in the underground sector where they get no legal protection and no rights.

    The house, the food stall, the market stand – all these, De Soto said in his best-selling book, have no tangible value that can be converted into new forms of production.

    “They don’t represent financial leverage,” he said.

    • UP n student on June 15, 2008 at 11:39 am

    KG: the problem with collaterizing property that you do not own is that you do not own it. When there is a cloud on the title, the property is worth significantly less. This is similar to the foolishness of buying a car that had been carnapped — they sell it at a huge discount because the stolen car still belongs to the original owner, and the buyer of the stolen property has no rights.

    Now when there is no cloud on the title, a lot more opportunities open up. Just think of Guantanamo, Cuba. Despite Castro despising their presence, because the title is clean and defensible in the world court, then the US has spent millions or billions of dollars to put buildings on the property. Similarly, foreign investments have always been slow in entering Cuba because the original owners to beach- and other real-estate still have claim to the property that Castro had confiscated.

    • UP n student on June 15, 2008 at 11:46 am

    US spent millions on their Guantanamo Bay facility because the US knew that Castro could not sue in any court to kick them out.

    • KG on June 15, 2008 at 11:54 am

    Up n Student,

    Thank You very Much.

    I remember commenting that it is easier to lose land when you put your land as collateral(those are for the lands that they do own).well that was just an opinion back then.

    • cvj on June 15, 2008 at 12:11 pm

    Karl, this is the latest statement about de Soto (from Bunye) that i could find in google.

    After that, i don’t know what happened since.

    UPn, the point of de Soto’s advocacy (which has the endorsement of conservatives like Margaret Thatcher) is precisely to remove cloud[s] on the title .

    • d0d0ng on June 15, 2008 at 2:21 pm

    UP n student on, “It seems silly (but urban-poor versus rural’s causes it to happen) to driving down the price of a commodity by buying from overseas.”

    Silly indeed! That is why it is a “pingpong” economic policy. The government notoriously try to deflect its failed agrarian program destroyed by importation and smearing it against the urban poor. As if the NFA could not have bought the rice at support price from local farmers to ensure increased production through predetermined quota and sell it to the urban at low price. As usual, the catatonic government respond only during crisis stage.

    • d0d0ng on June 15, 2008 at 2:43 pm

    Bencard on, “it seems to me that your “rural folk” are getting less and less in number because most are flocking to the cities…”

    There you go. The government shoot itself on its urban-poor preference over rural farmers reasoning on importation. Simply, there is no more opportunity in farming with increasing importation as Philippines consistently being the world top rice importer – only this government can proudly claim as pro-poor policy, driving everybody to the slaughterhouse. Hehe.

    The economic doctorate President simply forgot the basic economics of spending funds locally to generate local production, domestic spending and job creation. But officials are addicted to kickbacks (tong) in importation.

    • leytenian on June 15, 2008 at 2:44 pm

    great article from NY york times…
    “De Soto and Delatour told the president that the first step was to title poor squatters in places where there could be no conflicting claims: the 40 percent of land owned by the state. ”

    I don’t think we have squatters land in manila and cebu owned by the state. It is mostly privately owned.

    And desoto said: They would need to create special arbitration panels to resolve ownership disputes; Haiti’s judiciary wasn’t up to it. Further reforms would then be needed to limit the countless steps required to open a business legally. The effort would take 5 to 10 years, they guessed.

    I think , this is happening in our country, gradual reform because our title and ownership law is not quite in placed.

    Squatters land is very difficult to divide even if private land owner will give title back to the state at lower price. Population in the squatter area is just too many and the land area is not enough. My first suggestion of providing employment somewhere else can be a solution to the poorest among the squatters, and maybe the next solution is to convert this land into some kind of high rise residential unit to cater the middle class who don’t want to leave the area. They will have first priority to buy a unit at a discounted price ( 50%) with title to their names. This way, no clouding of title will arise. They will pay mortgage to the remaining 50% and cannot use the their unit title as collateral unless balance of debt’s is at 30%. If they will default their loan, the government will take it back and sell it to someone else. It’s a win-win situation for the government, the people and the private land owner. It’s a crazy idea but it will work.

    There’s two kinds of title theory…lien theory and title theory that I know of in terms of real estate. Not sure what we have in the Philippines. Land title or property title should be publicly available. A first lien and second lien will be recorded to notify the public that there’s debt attach to it.
    According to de soto: “They don’t represent financial leverage,”
    it’s the same as cloud of title..

    A title insurance or policy will protect the buyer from a cloud of title and will also protect the seller’s property value from devaluating.
    A clear title can be used as collateral and therefore will present a financial leverage…

    • rego on June 15, 2008 at 3:19 pm

    Bencard, the productivity metrics of corporate plantations clash with the need to find jobs for rural folk. These agricultural industrialists would not hesitate to substitute a tractor for a human hand if their number crunchers say so since increasing shareholder value is their priority, and not human (or community) development. Also, with the determination shown by the Sumilao farmers, i think you’re underestimating the spirit of small farmers and tenants.



    So ano talga ang gusto para sa mag magsasaka natin, CVJ?
    Forever nilang ibilad ang mga hubad nilang katawan sa scorching sun kesa sa mag drive ng tractor at mag operate ng ibat ibang morden farma machineries.

    I mean I like the articulateness on all your postings. Even more admirable is the sincere concern on the welfare of our farmers that you are trying to project here.

    Kaya lang Im having this impression that that concern is just based on the books you read over your well cushioned bed.

    Im wondering if you really experinced plowing the field using a carabao or dipping your bare foot sa putikan ng mga pilalapil par mag tanim. Or even just walking over the cogon grass where the sharp edge of the cogon leaves cut you bare legs.And under the scorching sun at that. Na pagpinawasan ka ang mag paa mo mahapdi at makati. Believe really is no fun.

    Ayaw mo ba talagang mag drive ang mga magsasaka natin ng tractor at ibat iba pang modern farm equipments With matching safety gears and tool, health and other benefits, steady income, suitable working conditions ubder Corporate farming.

    Dito sa debateng agraian reform, Yung mga pro agarian reforms people kaya na katulad ni CVJ ay talgang magsasaka in the real sense the word. Nakaranas ba talaag sialang mag saka O nakaexperienc man lang magsaka? Reading the posting of cvj in this thread , i realy realy doubt if they expereince working in teh farms at all.

    • rego on June 15, 2008 at 3:46 pm

    OFW Devlopemt bank? sound great!

    Buts I dont think it sgoing to happem at all. Any of teh existing banks can design similar program No need to put up another bank.

    • cvj on June 15, 2008 at 4:23 pm

    Rego (at 3:19 pm), sorry but you’re arguing to the wrong point. My comment (at 12:14 am) was not about manual farming versus using tractors. It was about corporate farming versus individual (or family-based) farming and their different priorities.

    • nash on June 15, 2008 at 8:42 pm

    Out of curiosity, how many OFWs contribute to the economy, other than via remittances, by voluntary SSS contributions?

    Just wondering as I’m about to be an OFW and yet no one here can tell me how I can re-start my SSS contributions.

    I understand the cynicism (sa tongressman rin lang mapupunta SSS natin..) but assuming we have a CLEAN government, those SSS contributions from OFWs can be beneficial..

    • Bencard on June 15, 2008 at 9:05 pm

    “the economic doctorate president simply forgot the basic economy of spending funds locally…” dodong

    wrong. arguably, never in the short history of the philippines has more funds spent in local infrastructure and farm-to-market roads (along with other incentives for the dispersal of industries in the countrysides) than in the current administration.

    as i said, not all filipinos are interested in farming. just because the father of a family supported his 6 children working in the family’s farm, it doesn’t mean that all 6 will do the same. human development is not limited to being able to work the land.

    • UP n student on June 15, 2008 at 9:28 pm

    So are we back again to OFW’s financial obligations to Pinas? cvj has stated that since his income is already taxed by Singapore, then it is immoral/illegal/contrary-to-trade for him to be taxed by Pinas. I disagree. Of course, Pinas-law says that OFW-income is tax-free to Pinas, so the law is on cvj’s side (But I think Pinas government has made a mistake… one of those v-e-r-y few instances where a Pinas government policy is unfair 😐 ).

    Fair-share, to me, means that the income of all citizens should be taxed fairly. I think it is unfair that the marginal-tax-rate for an executive working in Makati is over 25% while other Pinoys earning much more are taxed at a marginal-tax-rate of ZERO.

    So the operative word is “fairly”. Method-one can be for an OFW to compute the tax he owes to Pinas, subtract all taxes he has paid to Singapore or France or USA, subtract another P20,000 from this number, and the remaining amount (if greater than zero) should be paid to Pinas. Method-two can be to start with the OFW-income, subtract a million pesos, then apply PHilippine tax laws on the remainder. This will mean that a number of lower-income OFW’s pay zero tax to Pinas, while Doc Bautista and other OFWs (e.g. doctors, petroleum engineers, financial analysts, managers, etcetera) who have been better blessed, do begin to pay income tax to Pinas.

    One cannot keep on asking Pinas government to use OPTM for government programs for the poor — at some point, fair-share has to kick in. [OPTM –other Pinoys’ tax-money]

    • UP n student on June 15, 2008 at 9:53 pm

    on de Sotto’s program… there are two types of assets tied up by the squatters. The first one (I’ll label SQ) is the value of whatever they put up on the land that they are illegally occupying. This can be hollow-blocks-plus-wood-walls-plus-roof or this can be a talyer or sarisari store. The second one is the value of the land itself. The squatter can not collaterize the land because they do not own the land.

    Land always has value, especially if it is within a few kilometers away from Makati or Quezon City. But the landowner get impaired from collaterizizing his land when squatters are on it.

    De Sotto wants to collaterize SQ, the assets that the squatters put up on the land. But can’t-be-done because the assets are standing on another person’s land. What is nonsensical is that some Pinoys (both squatters and non-squatters) believe that the squatters should be able to collaterize what they own (“SQ”) and what the squatters do not own (the land) and begin to suggest “… ang tigas naman ng puso ninyo!!” when people remind them of rule-of-law and property rights. Generosity with other-people’s property is a serious disease.

    • cvj on June 15, 2008 at 10:22 pm

    on de Sotto’s program… there are two types of assets tied up by the squatters. The first one (I’ll label SQ) is the value of whatever they put up on the land that they are illegally occupying…..The squatter can not collaterize the land because they do not own the land. – UPn Student

    That’s an incorrect description of de Sotto’s program. What he advocates is formalizing the Squatters’ settlement by granting them title to the land. So that means that they are no longer illegal and can therefore collaterize the land, just like any other property owner.

    Nash (at 8:42pm), that’s a good question. I need to do that as well.

    • leytenian on June 15, 2008 at 10:34 pm

    UP n Student,,
    “cvj has stated that since his income is already taxed by Singapore, then it is immoral/illegal/contrary-to-trade for him to be taxed by Pinas.”

    CVG is right.. it is illegal for Philippines to double tax his income . There’s a double taxation agreement or international tax treaty on income between countries.
    Many countries enter into double taxation agreement relief to encourage the free flow of commerce between the two countries. Individuals and companies are less likely to do business where they will be taxed twice.

    If the Philippines will propose to US to allow double taxation, US may limit overall remittances, limit immigration and recruiting of professional . Same thing with other countries. One changes of our policy will hurt our economy if we are not careful of what we are doing. Leave taxation alone according to international treaty standard of practice.

    Philippines is having too much debt. Now it is trying to find ways to make money… HAY NAKU … bakit kasi tayo nag-utang para sa mga projects na useless… we don’t have the power to demand in the international arena..

    “The foreign debt is World War Three. It’s a war that does not kill governors. It does not kill soldiers. It’s a war that does not kill politicians. It kills innocent people. It kills children. It kills women. It kills the poor people of the planet.”

    • leytenian on June 15, 2008 at 10:58 pm

    if we have to compare our economy to an individual, this individual has lots of debts, not enjoying life, stressed out and probably have few options except work and follow rules at employment site. he/she will find ways to make more money in a desperate way. sounds like Philippines? to get us out of debt and be independent again… what do you think we should do?
    agrarian? population, education, etc are just one solution to help our economy in the future… but we need cash flow now to implement our plan..

    the clear title of the Philippine Republic is already pawned/collateral to IMF and World Bank. we are not Independent folks..

    • cvj on June 15, 2008 at 11:10 pm

    …which brings us back to the Argentinian model (also proposed by Dr. Martin Bautista) of prioritizing domestic spending over debt service. For efficiency, i’m linking back to our discussion on the same topic on this previous thread:

    Hvrds’ timeline of the Argentina Crisis, Debt moratorium and economic recovery is useful.

    • jmd on June 15, 2008 at 11:17 pm

    Generosity with other-people’s property is a serious disease. – UP N Student

    I agree. Seems to be the prevalent attitude nowadays.

    The rule of Law has to prevail. The laws on property have to be respected if we are going to move forward. Otherwise investors will shy away.

    If the government wants to give private land away, it can always exercise their right of imminent domain. Pay the property owner and give it out.

Load more

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.