Philippines: President Arroyo’s corruption leaves Philippines in crisis

The ‘liberal-democratic’ political system of the Philippines is in freefall.

Gloria Macapagal-Arroyo won the country’s presidential election last year, and her term officially ends in 2010. But a mass movement is stirring below that is set to sweep her aside; like 4 years ago against the corrupt president Joseph Estrada, and the “peoples power revolution” of 15 years prior against the dictatorship of Ferdinand Marcos.

Arroyo has been caught on wiretapped recordings with election officials conspiring to rig the election results by a one million-vote victory margin. She admits the voice is hers. There is also strong evidence to suggest that her election fraud was financed through illegal gambling via her husband and sons.

Opinion polls suggest that over 85% of Filipinos want her impeached, and her approval ratings are the lowest of any Philippine president since polling began. One third of Arroyo’s cabinet has resigned, and a key party has left her political coalition. She has become so unpopular that even Philippine business and finance sectors are beginning to withdraw their support.

Philippine Poverty

Medium-sized rallies calling for her downfall are being held on an almost daily basis. But the corruption scandals are just the tip of the iceberg. Underlying this growing opposition are the vicious pro-business policies she has introduced recently – including paying over one third of the national budget on debt repayment.

The top 10% of Filipinos take 37% of the total income in the country, while the lowest 20% receive only 5%. Land remains monopolised by a rich few, and unemployment is over 20%. More than a third of the population live below the poverty line, with nearly half the 88 million population living on less than $2 a day.

Arroyo, has cut government spending, privatised state services, cut health subsidies, slashed the education budget, and increased taxes for the poor. The ruling class is caught between the need to cut living standards in order to increase profits, and the fear that such measures will cause widespread revolt.

Last year, the growth rate hit 6.1%, the highest figure in 15 years, and this year it is expected to reach 5%. But the economy now relies heavily on Chinese and US growth. With a foreign debt of more than US$50 billion, many economists now worry that there is the potential for an Argentina-style financial meltdown (30 % of potential government revenue is lost through tax evasion and corruption, dangerous indicators of such a phenomenon). Political uncertainty has left the stock market shaky, and sent the peso to a five-month low.

While it seems the middle class — a crucial factor in previous uprisings — is yet to move decisively, it comes as no surprise that most big business, the senior officer corps, and the influential Roman Catholic Church are still unsure about replacing her. They are supported by the US and the western media who see Arroyo as a loyal supporter of Bush’s ‘war on terror’.

US interests in the Philippines

The US annexed the Philippines in 1899, setting up a ruling clique of ‘hacienderos’ (big landlords) in the colonial government. From there it has used Filipino big business as an ally for their coinciding interests.

US relations with Arroyo soured over her decision to withdraw Philippine troops from Iraq last year. However this does not mean that the US has abandoned her. Ever since the Philippine senate voted to close down US bases in the country in 1991, Arroyo has been the US’s most reliable ally. She has allowed US military operations in the Philippines, and 1000 US troops have been deployed there as ‘trainers’.

For their part, the US Administration has repeatedly warned that they will not tolerate ‘extra-constitutional’ solutions to the crisis. This means they will move to prevent any move by ordinary Filipinos to have control of their own country – something that cannot guarantee the protection of US interests.

No more Arroyos, Estradas, or Marcos!

Attending the military parade on Philippine National Day, Arroyo defended calls for her resignation as “extreme madness”. A US-trained economist, Arroyo warned that “the global marketplace” had noticed and applauded her “painful but necessary steps to raise revenues, reform collections and present a fiscally responsible budget”.

It is unclear at the moment if Arroyo will ride out the storm – for now – or be replaced by some other conservative leader. The rival conservatives are calling for a constitutional succession, in which the vice-president takes over control of the government.

The Stalinist Communist Party of the Philippines (CPP), who at this stage are organising the majority of the demonstrations, is calling for parliamentary reform. The CPP have a strict two-stage theory of supporting ‘democratic’ or ‘progressive capitalism’ over ‘corrupt capitalism’, and for this reason advocated liberal democracy to end the Marcos dictatorship.

But the mood on the streets of Manilla is different to 1986, and demonstrations are yet to reach the same proportions as previous periods. Liberal democracy has merely allowed rival sections of the Filipino elite access to power, and ordinary Filipinos know that any new elections will change only the face, and not the substance, of the government.

A new mass workers’ party is needed in the Philippines, organising workers and the rural poor with an anti-capitalist, anti-US imperialism, and anti-Stalinist programme of social and democratic demands. The CWI and SP believe that no ‘progressive’ or ‘democratic capitalism’ exists, and that only a socialist transformation of the Philippines can prevent any more Arroyos, Estradas, or Marcos.

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August 2005