[Series] Oligarchs and Nation-building

Co-authored with Jayvy Gamboa

Filipino translation; Bisaya translation

PART 1: Businesses build a nation; oligarchies dominate

On the craze of the ABS-CBN franchise denial, government leaders, namely President Duterte and his allies in the House of Representatives, have recently been the most vocal on the administration’s crusade against oligarchy to the extent of demonizing the whole business community who for decades strives to keep the Philippine economy afloat, despite the unstable political landscape.

Duterte, barely a few minutes in his 5th State of the Nation Address, said, “Great wealth enables economic elites and corporations to influence public policy to their advantage.” He then publicly accused of Senator Franklin Drilon of defending the oligarchs, but on the same breath called out the senator’s attack on political dynasties that of course included the Duterte family.

More often than not, the listening public would easily conflate oligarchy with business in general. But is this correct?

In this three-part series on oligarchy and nation-building, we clarify the often conflated image of oligarchs who dominate the nation and of a business community who contributes to nation-building; look and articulate the potential of oligarchs to transform into now nation-builders; and conclude that what Duterte is actually attacking are  nation-builders, not oligarchs.

Clarifying images of oligarchs

When people think of oligarchs, they connote businesses, profit, control over the market, and abuse. Images of oligarchs in the mind of the public include sinister old men, Spanish or Chinese mestizos, in their neatly pressed bespoke suits seated around a table made of hardwood in an air-conditioned conference room at one of the skyscrapers in the business district of Makati or BGC. Probably laughing their way through a successful business venture, a settled dispute with the labor union, or an off-the-record statement of one of their executives about how they were able to secure a government clearance just by talking to the “right people.” They always win and they always get what they want.

These said, we ask, are all businesses being run by oligarchs? Definitely no.

Without going into a rigorous discussion on what precisely accounts for oligarchy, we attempt to distinguish an oligarch from a non-oligarch; from a business community. It may be said that oligarchs are people or groups of people, often families, who possess significant interest and influence over both the economic and political spheres.

If we are to venture an image, without referring to any particular oligarch, think of a family, owning multiple businesses across industries, perhaps telecommunications, agriculture, and real estate, having substantial market share enough to influence the price or supply levels. Contrary to businessmen and women with purely economic undertaking, it must be then coupled with holding several positions in government, whether in the executive or legislative, whether or not their offices are directly related to their line of business.

Economic dominance, on one hand, and political influence, on the other, are what forms a potential oligarch.

In defense of business in nation-building

In reality, we have a much less number of families in the country who are included in the class of oligarchs than what might people think. Although there are quite a number of families competing in the market, only a handful of them choose to go beyond business and be involved with politics as well.

We assert that, contrary to the sweeping claims of the administration against the Lopezes, Ayalas, and Pangilinan, among others, they are legitimate businesses who contribute to nation-building.

In the case of the Ayalas, as owner of a Metro Manila water concessionaire, Manila Water, they took charge of the water distribution utility in the 1990s from the government-led failures of providing accessible and safe water source for the public. They also lead the telecommunications and banking industry through Globe and BPI, respectively. If this is still not enough to prove their commitment to the betterment of Filipino lives, they established the APEC Schools in 2013 offering affordable and learner-centered education to thousands of students. Looking forward, the AC Energy invests in renewable and sustainable energy and AC Health provides affordable healthcare for all through Generika. Celebrating its 30th year this 2020, Ayala Foundation has kept Filipino culture and heritage alive (Ayala Museum), built communities through sustainable livelihood, and transformed the lives of Filipino youth (Ayala Young Leaders Congress).

In the case of Pangilinan, he leads Maynilad, the counterpart water concessionaire of Manila Water in water distribution in eastern Metro Manila. The often criticized Meralco, PLDT, and Smart of the energy and telecommunications industry are also under his leadership. TV5, another stronghold of press freedom, is included as well. In fact, Pangilinan welcomed the distressed laid-off workers of ABS-CBN to his network. He is also the Chairman of Philippine Business for Social Progress, and is known to have vast philanthropic work through PLDT Smart Foundation, Alagang Kapatid Foundation, One Meralco Foundation, MVP Sports Foundation, and Makati Medical Center Foundation.

Pangilinan, together with the Ayalas, also lead the Philippine Disaster Resilience Foundation, the umbrella organization of the private sector for disaster preparedness, relief, and recovery, which focuses in five key sectors: (a) shelter, (b) livelihood, (c) education, (d) environment, and (e) water, infrastructure, sanitation, and health.

In the case of the Lopezes, while we admit that they may have had oligarchic roots, we then and now reiterate that they have already transformed into nation-builders undeserving of the vilification Congress gave them, which will be discussed in the second part of this series.

We have also acknowledged in another article the crucial role that the business community has generously contributed to the COVID-19 response that can be characterized as carrying a heavier burden than what is expected from them. Ironically, Presidential Spokesperson Roque said “I do not know why ABS-CBN could not have done more like the Ayalas and MVP (Pangilinan) did. I guess that’s the difference,” pitting the businesses against each other. We all know that this is not true.

While we seem to defend the Philippine business community, this should not be seen as a blanket endorsement of all of their business practices such as those that clearly desecrate our environment and abuse our Filipino workers. However, we believe that if they indeed violated any regulation, the proper approach is not condemnation and outright closure, but engagement by challenging them to be better.

Businesses build communities, and likewise the nation. On the contrary, we can distinguish oligarchs from businesses because the former consider nation-building merely secondary to their interests. Instead, they like to dominate national and public benefit for their own gain.

Oligarchy in nation-building

From businesses who build, we now go to oligarchs who dominate.

We cannot blame the people for the animosity against oligarchs they now carry. Our history as a nation is replete with illustrations that formed the belief that a nation built and a government ruled and ran by oligarchs are what prevent its people from living a comfortable life. The cronies of Marcos are the best example of that. The national experience had concretized the belief that an oligarch must have no place in nation-building. Yes, we stand by this, but this must not be done to the detriment of the legitimate and sustainable businesses.

However, Duterte and his allies in Congress takes advantage, yet again, of this outcry and finds a new public enemy: the business community. People, including the administration, often too conveniently put it upon themselves to point fingers to corporations and businesses, which for them are almost automatically labelled as oligarchs. This has to stop if we want businesses to thrive.

The question then for us to answer in the next part of the series is whether a transformation from an oligarch to a nation-builder is possible. The Lopezes may have an answer.

Visit this website to access the article.

PART 2: From oligarchs to nation-builders

Once the image of what an oligarch as opposed to a legitimate business, as discussed in the first part of this series, is clear to us, we can now discuss the seeming dichotomy between oligarchy and nation-building.

Are they rigid blocks that will never complement each other?

The incompatibility between an oligarch and a nation-builder, as the former emits selfishness while the latter radiates selflessness, forces us to think of binary opposites, which supposes that a choice can be made only between the two. Moreover, a dichotomy creates an illusion of choices and an illusion of choosing. One is forced to think as if the choices are restricted between A and B. How about C, D, or E? How about the possibility of change? Of A transforming into B, or B into A?

Once a choice had been made, the dichotomy merely creates space for an eventual condemnation, let us say, of the oligarchs. It seems impossible to do it any other way once the person had already chosen his fate as an oligarch. Change is simply not a choice. To do away from being an oligarch is not an option. It begs the question, is condemnation the only way to move forward? We disagree.

Alternative to oligarch – nation-builder dichotomy 

A spectrum, instead of a dichotomy, where an oligarch and a nation-builder belong is a conducive narrative for transformation.

Unlike a dichotomy, a spectrum is a continuum; thus, not restricted to an “A or B” mindset, but allows for “from A to B” or “from B to A”. With its free-flowing nature comes the potential that an oligarch may transform into a nation-builder, however remote that possibility is. The converse may also be true. At this point, we just need to recognize that it is not impossible.

If we then consider a spectrum, there must be a common ground—or line—on which an oligarch and a nation-builder tread; possibly the crux of change. It suffices for now that both have the potential to create an impact to the national consciousness. When an oligarch dominates an industry or region to the point of abuse, then those affected will live with and make known the struggle. On the other hand, when a nation-builder uplifts the marginalized and protects the vulnerable, then those will carry on to tell the story of greatness and generosity.

Lopezes as oligarchs

The roots of the alleged oligarchy of the Lopezes may be traced to the brothers, Eugenio “Eñing” Lopez, Sr. and Fernando “Nanding” Lopez, Sr. Although the Lopez family was prominent and owned vast business ventures in Iloilo, it may be said that both Eñing and Nanding were the visionaries in the family that brought them from a local business player to the national spotlight: Eñing as businessman and Nanding as politician – the very elements of a potential oligarchy.

Involved in various industries, Eñing engaged with the transportation (land and air transportation), energy (MERALCO), mass media (Manila Chronicle and ABS-CBN Corporation), and agriculture (sugar), among others. His vast business assets and undeniable national influence enabled him to meddle in national, and perhaps, local politics.

Coupled with his brother’s economic dominance, Nanding is known in Philippine history as the only person who was able to serve as Vice President of two different Presidents, Elpidio Quirino (1949-1953) and Ferdinand Marcos (1965-1973).

History was a witness how their affair with Marcos turned out. It started sweet as seen from Nanding’s selection as Marcos’ running mate and eventual Vice Presidency. Eñing definitely supported his brother by pouring money into the campaign. But it ended with a falling out; Marcos detaining Eugenio “Geny” Lopez, Jr., Eñing’s son, and offering the father his son’s liberty if only he sold his companies to Marcos and his cronies, and Marcos removing the position of Vice President to ease Nanding out of his government. Stripped of economic and political influence, members of the Lopez family were either exiled or detained. Interestingly, Marcos branded the Lopez family as an “oligarch”.

The fall of the Marcos dictatorship and the return of the Lopezes to revive their businesses in the post-EDSA Philippines is the turning point: from oligarchs to nation-builders.

Lopezes transformed to nation-builders

Geny Lopez, and later his son, Eugenio “Gabby” Lopez III, are at the forefront of making nation-builders out of the oligarchy that their family once was. Currently, the Lopez Holdings Corporation has interests in four major industries: Power and Energy (First Gen), Multimedia Communications (ABS-CBN and Sky Cable), Property Development (Rockwell Land and First Philippine Industrial Park), and Manufacturing (First Philec).

Politics dropped. The post-EDSA Lopezes had a firm resolve: no more politics. There is no Lopez who occupied any significant government position, except for Gina Lopez who we will talk about below. They learned it the hard way when Marcos’ caprices made them powerless, as if their whole lives’ works depended on a single man – which should not be the case. Perhaps, there was a consciousness that economic and political powers combined is a disaster waiting to happen, a bedrock of corruption.

Corporatized. A vision for transparency and accountability took numerous Lopez companies, such as First Gen, ABS-CBN, and Rockwell, to become publicly listed. It is as if one is opening the doors of his business to be scrutinized and of course to be invested on by anyone. Not only did such move brought trust back to the Lopezes’ style of management, but also drove innovation. Most importantly, good corporate governance pushes the Lopezes to make management decisions that are beneficial not only to their stockholders, but to their stakeholders.

In the service of the Filipino. The Lopezes’ commitment to public service – and nation-building – is what cements its transformation from an oligarch to a nation-builder. The list is endless: ABS-CBN’s informative reporting, regional programming, entertainment, and TFC, Sky Cable’s internet, First Gen’s renewable energy, Rockwell’s communities, First Pacific Industrial Park’s employment, Bantay-Bata 163’s rescued children; Sagip Kapamilya’s disaster response; Bantay Kalikasan’s Ilog Pasig and La Mesa. All of these done not out of publicity, but of a core value public service must be the top priority in their business.

Notable also are the Lopezes’ passion for environmental protection in the persons of Oscar Lopez who founded a center that supports science-driven technology in building resilient communities, and Gina Lopez, who, despite being an Environment Secretary in Duterte’s government, with no strings attached actively closed irresponsible mining in the country until she was eased out by the mining lobby.

The Lopezes have proven that a transformation from an oligarch to a nation-builder is indeed not impossible.

However, while we know the traditional oligarchs as businessmen turned politicians or who fund political parties and propaganda like what the Lopezes used to be, present day oligarchs do not anymore take this form. Today, we see oligarchs in the politicians, particularly the political dynasties, who use, and worse, coerce legitimate businesses to consolidate power.

The next and final part of the series looks into how, in closing down ABS-CBN, Duterte dismantled a nation-builder, not as what he says – an oligarch.

Visit this website to access the article.

PART 3: Duterte dismantles nation-builders, not oligarchs

President Duterte said in his controversial Jolo speech last July 13, 2020, referring to ABS-CBN, “Without declaring martial law, I dismantled the oligarchy that controls the economy of the Filipino people.” This was done merely a few days after the House Committee on Legislative Franchises refused to grant ABS-CBN a franchise for its continued operation.

The goal of dismantling oligarchy in the country, as affirmed by political analysts and the academe, is truly laudable – only if done correctly. We agree with this, and as discussed in the first and second parts of this series, waging a war against oligarchy, without distinction between real oligarchs and legitimate and sustainable business community, and without regard for the possibility of transformation from an oligarch to a nation-builder (i.e. Lopezes), is bound to fail and to widen the cracks of our already fragmented society.

An endeavor like Duterte’s where no such distinctions is made will dismantle the nation.

Too proud

In the midst of an admittedly inept pandemic response and with only two years left in his administration that has failed its biggest ambitions for the country, from eliminating illegal drugs, pushing for federalism, concluding insurgence through peace talks, defending the West Philippine Sea to ending ENDO, the closure of ABS-CBN seems to be the only trophy that the Duterte administration has under its belt. He said in the same speech, “Sa totoo lang, I’m extremely proud of myself and I do not want to share that with anybody. … Gusto ko, ako lang ang proud that I dismantled the bedrock – ‘yong pinakaposte ng oligarchy sa Pilipinas.”

We hate to burst anyone’s bubble, but still, ABS-CBN’s closure is nowhere near an achievement – if it is the country’s benefit that we are concerned with, not of some vested interests.

As we comprehensively argued in the second part of this series, the Lopezes, the owners of ABS-CBN, may have had oligarchic roots having both economic and political influence, but has since proven to the world that it has transformed to a nation-builder through the countless initiatives “in the service of the Filipino”. Thus, the closure of ABS-CBN is no less than a closure of a nation-builder.

Sadly, we ask, what do we then call a person, much more a President, who dismantles nation-builders and “extremely proud” to have done so?

One thing is for sure though: a nation-builder does not and will never dismantle a fellow nation-builder.

A President may have been democratically elected to lead a country, but that does not in itself make him a nation-builder. It entails so much more than the position.

Our history shows that being a nation-builder requires genuine selflessness, competence, and integrity, not some mere title nor authority that can be wielded at one’s own will. More often than not, it also involves compassion and humility.

Other dismantled nation-builders

The Duterte administration and its allies have brought down numerous nation-builders since 2016.

Chief Justice Maria Lourdes Sereno, only on the 6th of her supposed 18 year-term, who was ousted by her own Court through a quo warranto petition filed by Solicitor General Jose Calida, together with Senator Leila de Lima who is now unjustly detained for more than 1000 days on the ground of made up drug charges, earned the President’s ire early in his term. Sereno had been vocal against the list of judges allegedly involved with drugs released by Duterte, while de Lima is a staunch critic of Duterte’s bloody anti-drug campaign even before he became President. Recently, Maria Ressa, CEO of Rappler, who has maintained standards of critical reporting that always seems to uncover hidden tracks by government, was convicted of cyber libel. These people are nation-builders through and through. Definitely, the country would have been in a better position if these had not been done to them.

If we will be creative enough, the tens of thousands killed, mostly poor, in Duterte’s drug war including fathers, mothers, and youth were also potential nation-builders – if they had been given the opportunity to live and reform. Tens of thousands families orphaned, grieving, and resentful. What then is left for the nation? Only damaged families that will be difficult, if not impossible, to heal.

Many more nation-builders will fall when the Anti-Terrorism Law of 2020 becomes operational. With its unconstitutional provisions on extended period of detention and violation of due process, activists both online and on the ground will be targeted by this law. The unbridled and overly vague law will bring chilling effect to progressives, reformists, and even the ordinary Filipino.

Why should our nation-builders have to suffer?

State of the (dismantled) Nation

The President delivered his 5th State of the Nation Address (SONA) last July 27. Expectations for a comprehensive roadmap for recovery were not met. Instead, as we have discussed in an earlier article, the President’s SONA was not meant for a country that suffers from a pandemic. What reverberated in his speech was his threats to Ayalas and Pangilinan, referring to their telecommunications enterprises Globe and PLDT-Smart, “[I]f you are not ready to improve, I might just as well close all of you and we revert back to the line telephone at kukunin ko ‘yan, i-expropriate ko sa gobyerno.” Duterte found his next oligarch-target.

But, we echo again that Ayalas and Pangilinan are legitimate business people with nothing else in mind but entrepreneurship and economic growth. Instead, Duterte should focus on what Deans Ronald Mendoza (Ateneo) and July Teehankee (DLSU) refer as ‘New Oligarchs’ or the political dynasties that capture our country’s political landscape and undermine investments. Make his administration and allies look to mirrors and they shall see the oligarchs that they ought to dismantle.

By dismantling nation-builders and failing to dismantle the ‘New Oligarchs’, the country’s institutions erode and remember that Duterte himself dismantles the nation.

Is he proud of this – with the same pride that he had when he successfully brought ABS-CBN down? That we do not know.

But we all know that this could be his legacy. A legacy of a dismantled nation. That we must resist.

Visit this website to access the article.

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