Crime in a Culture of Corruption

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(The following are excerpts from ‘The True State of the Philippines: Crime in a Culture of Corruption’, by Ruel Pepa, published 2013 July 21 in NewsJunkiePost.com. Mr. Pepa is a retired university academic in the fields of philosophy and cultural studies. He was born, raised and spent most of his life in the Philippines. He is currently based in Madrid, Spain.)

The Philippines government has long been ineffective at solving crimes, many of which are categorized as being heinous. Rampant crime has plagued practically all levels of Philippine society, and their occurrences have largely been attributed to the weak and useless systems that characterize the government, especially those mechanisms within it that are meant to address the crime problem.

The crime problem has taken its toll on the lifeblood of the nation’s socioeconomic situation. Crimes have tremendously affected the country’s economic growth. A large segment of our people has lost confidence in the law-enforcing agencies of government. Many fear that tragedy might suddenly strike them in broad daylight. Stories from the newspapers (particularly the tabloids) are sufficient to send tingles down the spine. One thing is certain: Filipino society is crime-ridden and the government is helpless at effectively checking and containing the already serious and increasingly more serious crime problem in the country.

1. Poverty. In a society like the Philippines, where poverty is a given, no second thought is needed to ascertain that in one way or another, poverty causes criminality. Crimes are committed in areas where the urban poor live, and their occurrence is quite regular. Poverty may not be strictly identified as a direct cause of crimes but certain circumstances brought forth by and within a situation of poverty cause them.

2. Abuse of Power. Another prominent cause of crime in Philippine society is somehow also related to our economic condition. It is not the type of crime perpetrated by people in a situation of poverty but one that terribly affects them. It exploits the economic weakness of the poor, and none but the poor are the unfortunate victims of its ravaging onslaught. This cause of crime is: abuse of power.

Abuse of power is routinely perpetrated by powerful government officials and law enforcers with a mandate to defend the rights of people and protect them from harm. Abuse of power is terribly serious in the Philippines. In most cases, crimes related to the abuse of power are not treated as crimes due to methods of circumventing the laws.

Every day newspaper banners report crimes committed by policemen and military personnel—hold-ups, kidnaps-for-ransom, murders, bank robberies, carjacking, etc. The crimes of these people are even more heinous than those committed by some poor, unknown and desperate criminals. Since the justice system in the country is so discouragingly defective, most of the time, powerful criminals are exonerated of their crimes, even those categorized as heinous. Meanwhile, the unknown, powerless poor suspects in lesser crimes are not given fair trials and thrown immediately in jail.

This is the true state of the Philippines as a nation. We are governed by corrupt leaders whose major agenda are their own personal vested interests. We have law enforcement agencies and institutions whose major task is to protect and defend the corrupt leaders of the country and in the process perpetuate the system of corruption. Because of these conditions, criminality has proliferated and will continue to proliferate in the next generations. The whole situation has put common Filipinos at great economic disadvantage, and poverty is here to stay “’til kingdom come.” Hopeless? Who holds the key to the most sensible answer?


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By Miguel Raymundo

Far from the true picture of the economy that belies Malacanang’s assertion of economic growth, latest numbers imply that the economy is on the wane, a far cry from the still sanguine assessment dished out by those in power.

Bluntly, political scams are weighing down on economy’s prospects and how businessmen perceive them.

Take the gross domestic product (GDP) which measures the nation’s local output, which has declined over the past quarters.

From a high of 7.7 percent in the first quarter of 2012, GDP has gone down to 6.3 percent in the first quarter of 2013 and a disappointing 5.7 percent growth in this year’s first quarter.

Blame game
As expected, officials heap the blame on the spate of natural calamities for the economy’s slump over the past quarters.

Finding fault, however, with the weather as the culprit of the economy’s woes may not be that accurate.
While the figures are quarterly, they nonetheless provide a glimpse into what has long bogged down the economy – uncompetitive, protectionist and corruption-prone.

Yearly, the Philippines aims to chalk up between six and seven percent GDP growth in its bid to make it one of Asia’s fastest-growing economies.

That projection takes into account the foreign exchange remittances of overseas Filipino workers (OFWs) which account for 20 percent of the annual GDP.

This year, prospects don’t augur well for a significant share of remittances to GDP due slowdown in this year’s first quarter as hostilities flare up in the job-rich Middle East, particularly in Libya, Iraq and Syria.

Moreover, certain policy and structural constraints still abound, one of which is the still unresolved 60:40 equity limit imposed by the Constitution on investors seeking to do business in the country.
While both Houses of Congress are receptive to striking out the archaic provision in the Constitution, it seems ironic that no less than President Aquino himself stands in the way.
In no unequivocal terms, he thumbed down any proposal to tinker with the basic law of the land, including its economic provisions.
Undoubtedly, the pro-Filipino but anti-foreigner equity ratio ceiling curbed the entry of foreign funds which only ended up in other hassle-free nations – Thailand, Vietnam and Myanmar.

Lack of infras
More often than not, prospective foreign investors bewail the government’s incoherent and unstable business policy, lack of infrastructure, particularly roads, ports and airports in the Philippines.

Yet, billions of pesos are allotted annually to finance the construction of highways, being the lifeblood of the economy.

Talk of corruption in the business circuit often revolves around the pork barrel scam, a major embarrassment to Aquino’s so-called tuwid na daan” program of government.

During the just-concluded World Economic Forum in Makati city, Finance Secretary Cesar Purisima was booed by activists for his upbeat assessment of the debt-plagued economy.

He was blamed for orchestrating the multi-billion dollar debt deals with the multilateral finance institutions, plunging the country deeper into a debt hole.

Not spared was Tourism Secretary Ramon Jimenez, a dyed-in-the-wool Aquino loyalist who was roundly assailed for giving tribute to Aquino’s “tuwid na daan” platform of government for the restoration of people’s faith in the government.

Contrary to what Aquino officials trumpet, critics believe that the recent growth in the Philippine economy was “artificial, narrow, debt-driven and unsustainable.”

Worse, it is accompanied by worsening job generation, growing unemployment and exclusionary growth, mainly in the narrow real-estate and construction sectors.

These sectors are supported by record-low interest rates, which have made financing for production and for consumption artificially cheap.

While it artificially increases economic activity, this situation of cheap financing is only momentary.

Filipino businessman, Manuel V. Pangilinan, whose group of companies operates toll roads, telecommunications firms, mining pits and power utilities, says while reforms are laudable, the government still needs to address many critical issues necessary for economic growth.

“Certainly, the soft spot of development is important – reforms, governance and perception of the Philippines – but there are hard parts of development as well. It can’t be all perception.” Pangilinan wants the government to cut red tape, reduce the cost of power and build more infrastructure.

For one, American financial services giant JP Morgan Chase has cut its 2014 economic growth forecast for the Philippines, noting that its first-quarter GDP results fell below expectations and turned out to be the slowest pace of expansion in 10 quarters.

It also revised its GDP growth forecast of six percent for the Philippines this year, down from the previous forecast of 6.6 percent.

As more and more analysts reassess their views on the Philippine economy, they tend to narrow down their verdict – that the much-hyped economic growth was but a flash in the pan.

Such labels as “Asia’s next miracle” and “Asia’s rising star” are all but empty advertisements meant to make the Philippines popular to investors.

Kamag-Anak Inc.

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ONLY modest reductions in poverty have been made since the economic and political collapse of the mid-1980s. Without doubt, severe regional disparities remain and the gap between the rich and the poor of this country continues to widen. While 75 percent poor Filipinos live in rural areas, the urban poor have contributed to the rising share of total poor population since 1971. Manila, once the bustling center of post-war business activity, is no longer the promised land it used to be. Migrating to the city is no longer a guarantee of a better life.

By World Bank calculations, urban poverty stood at around 23 percent and rural poverty at 53 percent in 1991. The numbers are far worse today. Most of our poor have little education and are engaged in the agriculture, fishery and forestry sectors and anemic government support have driven our farmers and fisher folk to the brink of poverty.

Compared with the rest of East Asia, government performance on poverty reduction has been downright disappointing, because the Philippines has not been able to sustain growth long enough to better the living conditions of the poor.

Stranger even is the fact that poverty declines remained modest even during the times of rapid economic growth as government policies discriminated against labor, subsidized capital-intensive production and gave low priority to agriculture and exports. This resulted in growth that was narrowly based and inequitable—trapping many Filipinos in low-paying jobs while capitalists made money out of labor’s misery.

The rich get richer while the poor stay poor—and multiply. If you look closely, the rich in this country bear the same face with politicians and government executives. People who run big business are—more often than not—related to someone in government. “Kamag-anak Inc.” never really left the building. The same evils hounding our society back in the 70s remain with us today.
There is no quick fix and panacea for everything that bedevils this nation. But getting rid of crooks in government and in big business is definitely a good place to start.

FROM THE CHAIRMAN: Inciting Upheaval

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By Ray L. Junia

RAPID changes are occuring in the economic front, hence OpinYon’s focus on its dynamics and how it shapes the fate–and future–of ordinary Filipinos as they plod on with their daily lives. In this week’s issue, we are delving into the widening and alarming rich-poor gap, often glossed over by the mainstream media in favor of sensational political stories. Research-based and interpreted in a layman’s language,  the story aims to be a wake-up call for the decision makers, both in government and private sectors, to assess how and why policy measures failed miserably in stemming the surging tide of disparity in democratizing the wealth of the nation.

Our Asian neighbors like Thailand and Malaysia succeeded in scaling down the dominant control of their economy by few families and there’s no reason why we can’t do the same for the sake of millions of Filipinos who continue to languish in silence under the yoke of poverty and deprivation.

Certainly, the people are sick and tired of glowing and self-serving government statements that the economy is booming. To them, economic growth is an empty boast as it has failed to uplift the quality of their lives.

Our government takes pride in being democratic. But in reality, it’s a subtle form of dictatorship by proxy in disguise because it it allows the oligarchs to reign supreme in the economy.

Unless decisively addressed, the worsening rise of poverty incidence vis-a-vis the insatiable appetite of the rich to rake in more profits may be likened to a ticking time bomb.

If the economic system is flawed, then why the heck do we insist on it? The clamor for a drastic change is resounding and unless we heed it, we may find ourselves jolted again by an onslaught of an irreversible political upheaval.

Poor Pinoy, Rich PNoy

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By Antonio J. Rosales

NO Filipino should be poor. 

With the government preparing a national budget of PhP2.268 trillion for 2014, every single Filipino (given a total population of 95.8 million) should expect to get PhP226,680 in services.

With the government awash in cash, no Filipino should go hungry or suffer the indignity of being unemployed, uneducated and homeless. But to the common Juan living in the cardboard cities of Manila, nothing could be farther from the truth.

Global Competitiveness

This two trillion budget, raised mostly from taxes, may be the reason foreign rating groups rate the country positively—as being attractive to foreign investments.

Just last week, a report by the World Economic Forum showed the country jumping six spots up the global competitive rankings, placing 59th among 148th countries this year.

The Philippines jumped six spots in the global competitiveness ranking, placing 59th among 148 countries this year, the World Economic Forum (WEF) said Wednesday.

The Global Competitiveness Report 2013-2014 said the country’s ranking improved from 65th place among 144 economies last year and according to the Makati Business Club, the Philippines has actually climbed 28 places since 2010.

The WEF report showed the Philippines coming sixth out of 10 nations in the Asean following the addition of Laos (89th place) and Myanmar (139th).  Surprisingly, the country also outranked India which slid to the 60th spot this year. (Singapore, ranked second in the world, is tops in the region while Indonesia became the biggest gainer, rising 12 notches to 38th).

U.S. Optimism

Two weeks ago, the results of a survey conducted by the American Chamber of Commerce in the Philippines (AmCham Philippines) and the US Chamber of Commerce also showed the Philippines in a positive light.

In a poll of 475 senior executives from US companies operating across the region, satisfaction in the Philippines increased in 14 of 16 business factors, led by a 50 percent increase in satisfaction with the stability of government and political system. A majority of US firms also showed satisfaction with the availability of trained personnel—the highest in the Asean region.

As with the WEF report, the AmCham Philippines survey also showed Singapore as the best country in the region to do business with given the its low levels of corruption, sufficient infrastructure and predictable laws and regulations.

Singapore’s strengths are the Philippines weaknesses, though.

Despite loud claims by Philippine officials of containing  corruption, US business leaders still see widespread corruption, lack of infrastructure and the tax system as the main deterrents to foreign investment.


Even as surveys showed robust economic growth on the one hand, this failed to offset unemployment figures as joblessness rose to 7.5% in April from last year’s 6.9 percent, this according to a Labor Force survey by the National Statistics Office (NSO).

While the economy grew by 6.8 percent in 2012, this was offset by the huge dip in Philippine employment.  Offering an explanation, the National Economic and Development Authority said the unemployment rate increased due to a lower level of employment amid a slightly higher labor force level.  Majority of the unemployed were high school graduates (31.7 percent), college graduates (21.3 percent) and college undergraduates (14.6 percent).


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