Year: 2014

Where did Jesus get the other 23 chromosomes?

If you missed it in school, chromosomes are the very, very basic stuff of life. These microscopic chromosomes contain the instructions for proteins to multiply and combine in such ways as to make up your brain, your heart, everything in your body.

Humans have 46 paired chromosomes, 23 from your father and 23 from your mother, the former contained in the sperm and the latter in the mother’s egg. When the sperm penetrates the egg, the two sets combine to produce your own chromosome, which you pass on to your children. (Different species have different numbers: cows have 30 pairs, chicken 39, flies 4, and bananas have 22.)

This is not a theory, but a fact, and discovered only starting 1888, and developed into a rigorous science that for the first time in man’s 10,000 years of civilized existence explains in excruciating detail how life forms. No sage, no religious leader could have known about it, simply because the tool for discovering these – the microscope — was invented only in the 17th century.

In this season during which a huge part of the world, Christendom celebrates the birth of its central figure Jesus Christ, and claims that he was both man and God, and born from a virgin, it should be interesting to ask the question: Who provided the other half?

Mary provided half of Jesus’ 23 pairs of chromosomes; but who provided the other half? The Gospels say Joseph had not “known’ Mary, and that Mary remained a virgin, which means no male provided those 23 chromosomes.

The Annunciation, ca.1644, by Philippe de Champaigne
The Annunciation, ca.1644, by Philippe de Champaigne

If it was God, or the Holy Spirit, as Catholic dogma would have it, the question will be more difficult: how did God “inject” his chromosomes into Mary’s womb? Did these materialize inside her, beamed down into her ala Star Trek teleportation —as medieval painter Philippe de Champaigne in fact suggests in his masterpiece “The Annunciation” (image above). But if that were the case, then God must have those chromosomes in a human body somewhere in his Heaven, or he wouldn’t have anything to teleport.

There is just no escaping it. Humans and most creatures on earth (there are exotic species that have asexual reproduction though) have paired sets of chromosomes, one coming from the father and one from the mother.

To say that Jesus was conceived and became a genuine human with only one set of 23 chromosomes, from Mary, without the other 23 chromosomes contributed by a father would be as ridiculous as claiming some human did not have a heart inside his chest, nor a brain inside his head. If he didn’t have the full pair of 23 chromosomes, the very definition of a man, he couldn’t have been human, but a creature like Superman from Krypton or a Na’avi from Pandora.

Conundrum
Or is the conundrum simply because humanity, when the Gospels were written and even up the 17th century, had different, even confused notions of sexual reproduction?

That’s actually the topic of an article by Andrew Lincoln “How babies were made in Jesus’ Time” in the Nov.-Dec 2014 issue of my favorite magazine. Biblical Archaeology Review. Lincoln is current Professor of New Testament Studies in the University of Gloucestershire.

Even before genetics and modern biology, most cultures, obviously from experience, indeed thought that sexual intercourse by which the liquid released by the male organ in orgasm called semen and impregnated inside the female’s sexual organ “somehow” created the fetus that would grow into a human being.

But in contrast to modern biology, the ancients did not see this as the male’s sperm uniting with the female egg, to create a unity containing the “essences” of both parents. Rather, the process was thought to be something like a seed planted on a pot which would grow into a plant or a tree. The male provided the seed while the female the matter for life, thus the term “semen” comes from the Latin word seed.

But in the patriarchal societies of most cultures, especially in the Middle East and then Europe, the male seed was raised to a higher pedestal, that it was really the “life force,” with the female’s fluids in her womb providing the gross matter for sustaining that life force.

The great philosopher, St. Thomas Aquinas in that pillar of Catholic dogma Summa Theologia summarized humanity’s notions of human reproduction from classical antiquity until the start of the scientific age: “The female supplies the matter, while the male is the active principle of generation.”

Practical purpose
The notion had a practical purpose for the ruling classes in antiquity, as kings and heroes would claim that their fathers were deities, therefore they had the right to rule. Theseus, the first king of Athens, had Poseidon as his father. Romulus the legendary founder of Rome had Mars. One of the towering figures of antiquity, Alexander the Great, claimed his father was the Big Boss of gods, Zeus. The Roman emperors claimed they were descended from gods, with Julius Caesar calling himself Jupiter Julius.

The Biblical Archaeology article even claims that Alexander’s case—having two “fathers” might have been the template for Jesus’ claims of divinity. Alexander thwarted the many claimants the throne to become Macedonian king as he was son of Philip, and therefore the legal successor. Yet as he conquered the great empires of that period, he claimed that he was the son of Zeus.

Similarly, the Gospel writers claimed Jesus was the Messiah, or savior of the Jewish nation long prophesized, as he was as well, at least technically, the son of Joseph, whose lineage the Old and the New Testaments traced to King David. But he is also the Son of God, so that he will save all of humanity.

“Evidently it was not unusual for ancient readers to entertain simultaneously two different stories about the origins of a great figure,” the article pointed out. “The other, suitable in the light of his later heroic achievements, involve a miraculous conception and envisaged him as a son of the gods.”

It is easy to understand how the ancients including those during Biblical times thought how humans are created since even in this modern era, children have no notion that their parents must have sexual intercourse as the first step to create babies. Most children simply believe that “love” between their parents in some way make babies – that is, just as the Holy Spirit simply hovered over Mary to produce Jesus.

Indeed even uneducated people in our country still have confused notions of sexual reproduction. A television episode last year by Korina Sanchez featured a teen-aged lady in the boondocks of Cebu province who claimed some troll (“dwende’) in their backyard fathered the baby she carried in her womb, simply by staring at her as he sat atop his mound.

There are several theses about who Jesus’ real biological father was, as the Gospels were quite categorical that it wasn’t Joseph. But that for another column.

Filed under: Manila Times Columns

P10 million per month ‘rental’?

De Lima knew about “Bilibid Resort” a year ago, why did she move only now?

Justice Secretary Leila de Lima had been informed a year ago by Philippine National Police officers that organized-crime lords were living luxury lifestyles inside Bilibid Prison, with the drug kingpins even continuing their drug operations from there.

Yet de Lima had dragged her foot for months and refused – until last week – to raid the prison so as to stop those scandalous operations at Bilibid. Why?

“We were very angry why de Lima was not doing anything,” a police officer said. “We risk our lives in operations, police officers were killed by these criminals, we refuse millions of pesos in bribes, only to find out that the criminals we sent to jail are living in luxury in Bilibid and are even allowed to get out for entertainment,” he said.

In a radio interview, jueteng whistle-blower Sandra Cam also disclosed that her group had brought an ex-jail guard Kabungsuan Makilala to de Lima who told her under oath all the corruption at Bilibid back in 2012. De Lima though refused to take him into the department’s witness protection program and refused to believe his testimony.

“Bilibid Resorts Board of Directors,” from top right counter-clockwise: Justice Department Secretary Leila de Lima (photo is her official one posted in the DOJ’s website); Franklin Jesus Bucayu, Bureau of Corrections director; Celso Bravo, officer-in-charge of the Assistant Director for Prison and Security; and Roberto Rabo, superintendent of New Bilibid Prison.
“Bilibid Resorts Board of Directors,” from top right counter-clockwise: Justice Department Secretary Leila de Lima (photo is her official one posted in the DOJ’s website); Franklin Jesus Bucayu, Bureau of Corrections director; Celso Bravo, officer-in-charge of the Assistant Director for Prison and Security; and Roberto Rabo, superintendent of New Bilibid Prison.

“One informant told us about two-dozen gang leaders there, especially the drug lords,” the police officer said, “contribute to pay P10 million monthly, their ‘rent’ to officials in charge of Bilibid — from the guards to officials at the justice-department level—so they would be allowed to do as they please inside Bilibid.”

What has recently been exposed in media, the officer claimed, is only the tip of the iceberg as the convicts were tipped a week before that there would be such a raid. “So only those who were so hard-headed that they didn’t believe in the warning are in trouble now,” the officer claimed.

De Lima’s raiding party contained not a single PNP personnel. She had not informed even the top leadership of the PNP, even interior secretary Mar Roxas, about the raid.

The officer claimed that President Aquino seemed to have totally trusted de Lima that his group’s efforts to push de Lima to act through media exposes accomplished nothing. Throughout this year, there were indeed occasional reports in newspapers and television about Bilibid being run by drug lords.

Chief Inspector Roque Merdegia Jr, of the PNP’s Anti-Illegal Drugs Special Operations Task Force was bold enough in June 2014 —six months ago—to publicly ask the Justice department to investigate the VIP treatment of drug lords the task force had arrested.

Merdegia reported at that time hat his task force’s had conducted an operation inside Bilibid and discovered that some high-profile convicts were staying in air-conditioned rooms with their own flat screen television and hot and cold shower. Merdegia also claimed that top drug lords were even allowed to go to top-of-the-line hospitals for “check-ups” and whenever they feel they have to consult with their doctors.

The Justice department ordered a probe, which however investigated solely why certain convicts were allowed to leave prison to go to their chosen hospitals, and even to visit their homes.

It is astonishing how in the face of this national embarrassment, this total failure of government (how could drug lords continue their criminal operations in a jail, and even have high-powered assault rifles?) those accountable for it aren’t immediately suspended.

These are Justice Secretary de Lima who supervises the Bureau of Corrections, its director Franklin Bucayu, his deputy in charge of prisons Celso Bravo, and the New Bilibid warden Roberto Rabo.

They should be immediately suspended, all their files and computers confiscated as these may contain evidence of their collusion\ with the convicts. Their bank accounts must be investigated by the Anti Money Laundering Council to determine if they received suspicious funds.

If there is a topic the Senate should be investigating in aid of legislation, it is the penal system. On one level, it has become the center of drug syndicates and a luxury resort, and on another it is hell for most of its occupants.

Such an investigation would unearth the answer to the most intriguing question right now: Why, after being informed of how Bilbid has been converted into a resort and nerve-center of drug lords more than a year ago, did de Lima act against these only now?

I’m astonished why President Aquino seems nonchalant about the scandal that is the “Bilibid Resort,” telling de Lima that it’s only the “high powered guns that worries him.”

What? Doesn’t he even remember his basic law courses that emphasized that the fifth pillar (after “community,” police, prosecutors, and courts) is the penal system? What would be the use of all the four pillars if, at the end of the day criminals are not only unpunished but are able to direct their criminal syndicates—from inside the penal system.

Cliché it certainly is, but I can’t help saying it: Only in the Philippines. Maybe also: Only under this incompetent government.

Our penal system under Aquino has given an entirely new meaning to South African legend Nelson Mandela’s famous quote: “It is said that no one truly knows a nation until one has been inside its jails.”

Filed under: Manila Times Columns

De Lima should be fired over ‘Bilibid Hilton’

You got to give it to Justice Secretary Leila de Lima’s chutzpa —or maybe her acting talent—to have expressed shock and anger over what the raid discovered at the country’s biggest prison, the New Bilibid, among these: luxury cells with hidden assault rifles, millions of pesos, a full-sized sex doll, a music recording studio, Jacuzzi tubs, and paraphernalia for managing an illegal drug trade.

As secretary of the justice department with the Bureau of Corrections being one of its biggest agencies, hasn’t Leila de Lima been in charge of it for nearly five years now? Shouldn’t she rather feel shame, and resign immediately, for her massive failure to manage our biggest prison that it has become a national embarrassment?

She should be fired immediately really for having supervised what has turned to be a travesty of our penal system.

Frankly, even her boss should really go because of this national embarrassment and clear failure of governance. Next time around, will they let moneyed inmates out armed with Armalites and go shooting people to escape the boredom of prison life?

Aquino in Bilibid, 2012 smiling as he looks at the lethal-injection bed. He should have inspected the suites, instead. Inset: Justice de Lima making sure moneyed inmate Colangco counts the money right.
Aquino in Bilibid, 2012 smiling as he looks at the lethal-injection bed. He should have inspected the suites, instead. Inset: Justice de Lima making sure moneyed inmate Colangco counts the money right.

Didn’t Aquino make a speech in January 2012 right in Bilibid itself in which he launched his so-called “Bureau of Corrections Roadmap” and in which he heaped praise on “every guard, warden, and everyone making up the Bureau of Corrections? “Aquino also said in his speech, translated from Pilipino: “Despite the burden of your responsibilities… you of the Bureau continue to uphold the well-being of your countrymen who are in jail.” Maybe the Bureau took his words too seriously providing the convicts with everything they wanted, even paid sex, it seems.

De Lima’s culpability is indubitable given the fact that she has practically run the Bureau of Corrections herself and weakened its administration by changing its director every year since she assumed office. The current director Franklin Jesus Bucayu was appointed to the post only last March. How can our prisons be run well if the head of the agency in charge of these is changed every year?

Our national prison is just an hour away from her office in Manila, and has been known to be the justice department’s most problematic agency. There has always been intense lobbying for the post, which only on the surface appears unattractive.

That it has become “Bilibid Hilton” for moneyed inmates to live in luxury and even for them to run drug rings can only mean either of two things, or maybe even both:

l De Lima is totally inept in managing it, and ensuring our penal system is a pillar of our justice system; or

l She is in cahoots with the web of corruption in the Bureau of Corrections, and she receives her share of rich and drug-lord inmates huge “rents” for them to live in Bilibid as if they weren’t in prison.

So which is which? For either explanation, she doesn’t have any business being secretary of justice. Or has she been too busy running after former President Arroyo and opposition legislators that she has criminally neglected supervising our penal system?

I am astonished at de Lima’s gall at not thinking that she is so very accountable for “Bilibid Hilton.” (How on earth can a maximum security jail become the operations center for convicted drug lords, whose business obviously have been so lucrative that they needed money-counting machines?)

She could act the way she is acting now, if she had raided the prison a few months ago, or even a year after she became justice secretary June 20, 2010. But nearly five years after?

Under her watch
Bilibid became a “Hilton” only under her and this administration’s watch. This is obvious since most of the rich inmates having luxurious facilities’ in the prison and even managing their drug syndicate from there were incarcerated in Bilibid only under this administration, a few after lengthy trials that started in the mid-2000s. For instance, Herbert Colangco, who even had his music video made in Blibid posted at YouTube, was arrested in 2009 but was transferred to Bilibid only in 2011 after being sentenced.

Why did de Lima order the raid only now? There are three very plausible explanations:

l The “rent” sent to her by the rich inmates and drug lords have stopped or had been reduced, and it was time to remind them what they’ll be missing. Or is it precisely an operation to raise “rents”?

l She got wind of the political opposition and press’ moves to expose “Bilibid Hilton,” so she pre-empted these by raiding it herself. It is a clever move indeed as she could respond to demands for her to resign with a terse: “I was the one who exposed and stopped it.” Indeed, only a few weeks ago, a television network run a series based on interviews with a Bilibid jail guard, who basically exposing “Bilibid Hilton, ” including inmates’ regular access to prostitutes.

l An ambitious – or maybe a morally upright — National Bureau of Investigation official got wind of “Bilibid Hilton” and pressured de Lima to authorize the bureau’s raid. De Lima had no choice but to approve it and decided to grab credit by joining the raid. An unkind explanation would be that the NBI official tried to extort money from the rich inmates and drug lords. When they didn’t cooperate, he ordered the raid.

However, if de Lima’s hands are clean, this episode only demonstrates her and this administration’s incompetence and naiveté. President Aquino inspected Bilibid in 2012, and nobody obviously told him about the ”luxury suites” available for moneyed inmates. Were the drug lords laughing their hearts out as Aquino toured the facility?

Interviewed at length at Channel 9 the other day, Bureau of Corrections Director Bucayo seemed to be more like a principal of a high school rather than a jailer tasked by government to keep its hardened, murderous criminals in jail. It is scandalous that he insists he was faultless in this Bilibid Hilton scandal.

He kept on making the excuse that Bilibid is too overcrowded, and that the guards are underpaid. Overcrowded when moneyed inmates could have their own suites? So low government wages make a good excuse for corruption?

The interviewer, who unfortunately seemed bored over her job, should have asked him why he and his guards couldn’t do the simple task of body-searching everyone who entered Bilibid, and barring anyone bringing such things to the inmates as sex dolls, Bushmaster M-16s, cell-phones, shabu, and millions of pesos.

Is that really so hard for officials of this administration? It isn’t of course if they resist drug money. For drug lords only became Kings of Bilibid during her and Aquino’s watch, and not before.

Filed under: Manila Times Columns

Aquino’s endorsement of Roxas, his gift to the nation

President Aquino’s endorsement of Mar Roxas as his political heir and the Liberal Party’s candidate for the 2016 elections would be his biggest gift to the nation, his lasting legacy. He could even package it as his Christmas gift to the nation good not only for this year but also the next, and we certainly won’t complain.

There are five reasons why.

First, for the first time in our post-war period, the presidential elections will not be based on personalities but on notions of government.

Roxas is all for Aquino’s “tuwid-na-daan, walang-mahirap-kung-walang-corrupt” “ideology”, for lack of a better word. The gist of their notion of government is as follows.

The Arroyo government was a totally corrupt one, the reincarnation of the Marcos regime, and just as Cory toppled the dictator, her son “toppled” the economist-president. Just as Cory was Marcos’ nemesis, Aquino is Arroyo’s. His governance’s be-and-end-all, the entire fight against corruption so there won’t be poverty is to put the former president and everyone involved in the corruption during her watch in jail.

The massive probe on pork-barrel corruption and the arrest and jailing of three prominent senators has been the essence of the tuwid-na-daan program. The bureaucracy will automatically become corrupt-free because henceforth there will fear of retribution, this tuwid thinking tells us.

Aquino and his transmogrification
Aquino and his transmogrification

Some other details of such a notion of government are as follows:

A Philippine president does not accept cash bribes and he does not involve himself in shady deals. He can however accept a Porsche as a congratulatory gift, or favor a conglomerate that has helped him bag a contract, even to the extent of nullifying a previous contract. He won’t interfere also with his officials who favor a particular group in winning a major contract, such as servicing a key utility such as the MRT-3.

Filipinos therefore, if Roxas is Aquino’s standard bearer, will be asked to decide if they want another such tuwid-na-daan government, and its narrow, weird view of governance.

They will decide if governance solely involves an anti-corruption tack , or if it should involve developing a strong and efficient state.

And coincidentally, even if one argues that the scale is so different, the current front-runner for 2016, Vice President Jejomar Binay is in effect saying that his government will be a strong and efficient state —just as he claims he made Makati as such for more than a decade.

Binay—whether he likes it not, and partly because of the intense campaign to portray him as corrupt—has projected himself as the antithesis of Aquino and his tuwid na daan mumbo-jumbo. Never mind if there is corruption, more important is the state’s efficiency.

Second, Roxas is Aquino’s clone, and nobody else is like this President. They are both scions of hacendero-based clans that have ruled this country for at least two centuries. Elites such as the Ayalas would be as comfortable with Roxas as they have been close to Aquino, but certainly not with Binay.

Both have been the favorites of two powerful media institutions, ABS-CBN, and the Philippine Daily Inquirer, although the latter seems to have given up hope and appears to be positioning Grace Poe as its chosen one.

If Aquino anoints Roxas as his candidate therefore, Filipinos would be given a clear choice to make: an executive of the elite or a product of the middle-classes. Marcos vs. Cojuangco-Aquino in 1985; Ramos vs. Santiago in 1992, Estrada vs. de Venecia in 1998; Arroyo vs FPJ in 2004—these contests didn’t present Filipinos with such a clear choices for a leader in terms of class origins as the names “Roxas” and “Binay” do.

Both the Spanish Roxas and Basque Araneta clans enriched themselves partly through the Spaniards’ galleon trade between Manila and Acapulco that started in the 16th century which was really the raison d’être for our colonization by Spain. That’s how far back in our history Mar’s elite lineage has been. The only information on “Binay” I could find was that it was an Irish clan, but it’s pretty obvious from the vice president’s skin color and height that his isn’t an Irish lineage.

Third, based on voter-preference polls, Binay’s victory in a one-to-one fight against Roxas would be a landslide, with the vice president possibly getting the biggest percentage of votes ever in the post-war era.

Thus, there will be near-unanimity in the nation’s choice of president. Thus our nation will be united, as it has never really been.

Fourth, Binay’ victory against Roxas would be a tectonic movement in class-consciousness, giving the working classes hope of power. Binay is of middle-class origins, and his rise to the political firmament has been a fluke (What if Cory’s political henchman, Aquilino Pimentel in 1986 had changed his mind and withdrew his offer for the human-rights lawyer Binay to be Makati officer-in-charge? ).

Call him a traditional, even a corrupt, local politician, but he is portraying himself as the working-class champion. On the other hand, despite all his hilarious gimmicks (“Mr. Palengke”), Roxas has projected himself as the elite’s CEO that would right the nation, the good-hearted hacendero who would take care of his serfs.

The 2016 election would thus be a celebration of democracy, with elections affirmed as the broad masses’ only venue, because of its sheer numbers, to tell the ruling class, “We do matter!”

Binay’s win would even demolish that class marker, skin color. Filipinos would no longer think being dark is ugly and means ‘poor.’ No longer would Filipinas spend hundreds of millions in skin whiteners, and black—and if you see Binay in person, he is more black than dark brown— would be beautiful, as that old cliché goes.

Fifth, Roxas’ extremely low ratings in voter-preference polls—6 percent in the most recent Pulse Asia survey—means his campaign financing will be drying up, with even the elite giving him only token contributions, especially with the type of Makati tycoons who would support Roxas as the Ayalas and the Concepcions who are known for their stinginess in political contributions.

Most of our opportunistic elite will throw their money at Binay, who would therefore owe nothing to any particular group. He could even turn down contributions from the usual suspects with one-syllable names known to ask for really big favors after the elections.

Binay therefore really wouldn’t owe anything to his financiers. That would mean that we’ll have a president, for the first time in our history, who is independent from the ruling class.

That therefore would be Aquino’s biggest, enduring gift to the nation.

Filed under: Manila Times Columns

SEC-PLDT ‘capital’ definition worse than Parity Amendment

Third of a series on the foreign investment issue

The Philippine Long Distance Telephone Co.’s (PLDT) definition of corporate control that included owners of preferred shares—later on suspiciously and scandalously adopted by the Securities and Exchange Commission—would have, as the Supreme Court itself put it, “far reaching implications to the entire nation, and to future generations of Filipinos.”

The PLDT and SEC’s definition of “capital” would be as detrimental to Filipinos’ control of the Philippine economy as the so-called Parity Rights our former colonizers held for decades, the Supreme Court claimed in its resolution dated October 9, 2012. Senior justice Antonio Carpio wrote the resolution, which was concurred with by nine of the 12 justices voting, including Chief Justice Ma. Lourdes Sereno.

The resolution threw out PLDT’s petition to reverse its earlier decision in 2011 that the telephone company is foreign-controlled with 64 percent of its common stocks held by foreigners, and therefore violating the Constitution.

As I explained in my column on Wednesday, PLDT and other companies like Globe had justified foreign control of their firms by arguing that in the computation of “capital” and corporate control, even non-voting preferred shares, which essentially are debts and whose owners have absolutely no say in the firm, should be included.

PLDT and Meralco: End of Americans’ Parity Rights in 1974 allowed Filipinos to control these utility firms. Supreme Court asks: Why do we allow them now to be controlled by Indonesians?
PLDT and Meralco: End of Americans’ Parity Rights in 1974 allowed Filipinos to control these utility firms. Supreme Court asks: Why do we allow them now to be controlled by Indonesians?

The so-called “Parity Amendment’ had been the most blatant means for US economic exploitation of its former colony even after its independence, since it allowed US companies to have equal rights with Filipinos in the utilization and exploitation of natural resources.

The Court itself described what this was:

“Filipinos have only to remind themselves of how this country was exploited under the Parity Amendment, which gave Americans the same rights as Filipinos in the exploitation of natural resources, and in the ownership and control of public utilities, in the Philippines. To do this, the 1935 Constitution, which contained the same 60 percent Filipino ownership and control requirement as the present 1987 Constitution, had to be amended to give Americans parity rights with Filipinos. There was bitter opposition to the Parity Amendment and many Filipinos eagerly awaited its expiration.”

US companies’ “parity rights” —actually a euphemism—was such a blatant violation of our sovereignty that it was the casus belli that stoked the nationalist movement starting in the 1960s. Since our elite saw nothing wrong with it, the Communist Party appropriated the issue to argue the need for armed revolution against the “US puppet” administration.

Stunning claim
The Court emphasized what is really a stunning claim:

(PLDT and its allies’) interpretation of “capital” (to include preferred shares) would bring us back to the same evils spawned by the Parity Amendment, effectively giving foreigners parity rights with Filipinos, but this time even without any amendment to the present Constitution. “ (Emphasis in the original)

The Court pointed out that what PLDT has done is even worse than parity rights:

“Worse, their interpretation opens up our national economy to effective control not only by Americans but also by all foreigners, be they Indonesians, Malaysians or Chinese, even in the absence of reciprocal treaty arrangements. At least the Parity Amendment…gave the capital-starved Filipinos theoretical parity – the same rights as Americans to exploit natural resources, and to own and control public utilities, in the United States of America. Here, their interpretation would effectively mean a unilateral opening up of our national economy to all foreigners, without any reciprocal arrangements.

The court warned: “That would mean that Indonesians, Malaysians and Chinese nationals could effectively control our mining companies and public utilities while Filipinos, even if they have the capital, could not control similar corporations in these countries.” (Emphasis mine)

The Court in its resolution concluded: “The 1935, 1973 and 1987 Constitutions have the same 60 percent Filipino ownership and control requirement for public utilities like PLDT. Any deviation from this requirement necessitates an amendment to the Constitution as exemplified by the Parity Amendment. This Court has no power to amend the Constitution for its power and duty is only to faithfully apply and interpret the Constitution.”

Maybe the Salim conglomerate took those words quite seriously— the part saying that an amendment to the Constitution is necessary. Maybe that’s why the lobbying for amending the economic provisions of the constitution has intensified.

It continues to be a Damocles sword above the Salim group controlling PLDT. The company itself has been forced in its disclosures to admit that one of its major corporate risks involves the allegation that its foreign ownership “exceeds the 60% to 40% Filipino-alien equity requirement as provided under the Philippine Constitution.”

In its decision, the Supreme Court emphasized: “In fact, a resolution of this issue will determine whether Filipinos are masters, or second-class citizens, in their own country. What is at stake here is whether Filipinos or foreigners will have effective control of the Philippine national economy. “

The Court did resolve it, with its final ruling throwing out PLDT’s justification for foreigners’ control of it made in October 2012 —more than two years ago.

Are we so debased as a Republic only pretending to be under the rule of law that even a Supreme Court decision “with far-reaching implications” has been ignored by the SEC, with PLDT and Globe sticking to its convenient definition of “capital” that has been its flimsy excuse for being controlled by Indonesians and Singaporeans?

I hope that they haven’t “reached” even the last bastion for the rule of law in our nation. the Supreme Court.

And nobody, not the President, not the Congress, not even the “nationalist bloc” there, not most of us care?

To be continued on Wednesday: Why the Court’s reference to parity rights is stinging indictment of Meralco and PLDT.

Filed under: Manila Times Columns

SEC has already amended the Constitution!

Through a mere memorandum, the Securities and Exchange Commission has, in effect, lifted in 2013 the constitutional provision that foreign equity cannot exceed 40 percent in utility firms.

Philippine Long Distance Telephone Co. (PLDT), and therefore, its cell phone subsidiary Smart, is 54 percent foreign-owned, mainly by the Indonesian Salim conglomerate’s First Pacific and the Japanese Nippon Telephone and Telegraph’s firms. Its competitor Globe Telecoms is 47 percent owned by Singapore Telecoms, with the Ayalas, the firm’s face, owning only 30 percent.

image-for-Tiglao-column-300x255
Which one is correct? Or who has the authority to define?

But based on the SEC’s memorandum, a bureaucratic sleight-of-hand, the two firms are considered majority controlled by Filipinos and are complying with the constitutional requirements.

How did the SEC manage to trash our Constitution? Quite ironically, or maybe even in a defiant pose, it was through its response to the Supreme Court’s earth-shaking decision in June 28, 2011 (reaffirmed June 2012) on a petition made by the late Wilson Gamboa in 2007.

The SEC changed the definition of “capital” in order to dilute foreigners’ shares.

The petition had claimed that that the purchase of the firm’s controlling shares by Salim and Japanese companies starting in 1999, and foreign firms’ holdings of its shares in the stock market, had resulted in an ownership structure that violated the constitutional limits on foreign equity in utility firms.

The Court itself pointed out that based on PLDT’s data itself (for 2010), 64 percent of the firms’ common shares were held by foreigners while Filipinos owned only 36 percent, thus breaching the Constitution’s 40 percent limit.

PLDT, however, argued that foreign ownership must be computed as a percentage of all kinds of shares, both common and preferred shares.

PLDT claimed that including preferred shares, Filipinos had 86 percent of total shares, while foreigners had only 14 percent.

PLDT’s arguments were hogwash, and everyone in the corporate and legal world knew it.

Nowhere in the world are preferred shares included in computing an entity’s control of a firm. From its invention in the US at the turn of the late 19th century, a preferred share is a bit of a misnomer, and is essentially a type of debt, reflected in the fact that it is assured of a fixed dividend, unlike dividends of common shares, which are based on the firm’s profitability. Preferred shares are almost by definition non-voting, that is, its owners have absolutely no say in running the corporation.

“Capital” means common shares

The Court threw out PLDT’s arguments and affirmed what everyone in the country and the world believe how corporate control is determined.

The court declared: “The term ‘capital’ in Section 11, Article XII of the 1987 Constitution refers only to shares of stock entitled to vote in the election of directors, and thus, in the present case only to common shares, and not to the total outstanding capital stock (common and non­voting preferred shares).”

The Court ordered: “Respondent Chairperson of the Securities and Exchange Commission is DIRECTED to apply this definition of the term ‘capital’ in determining the extent of allowable foreign ownership in respondent Philippine Long Distance Telephone Company, and if there is a violation of Section 11, Article XII of the Constitution, to impose the appropriate sanctions under the law.” (All caps font in original decision.).”

But what does the SEC do?

It issued Memorandum Circular No. 8 May 22, 2013, signed solely by its chair Tersita Herbosa — who was formerly a partner at ACCRA law, which has been PLDT’s law firm for decades. The most important part of the memorandum reads:

“For purposes of determining compliance (with the constitutional ownership requirement), the required percentage of Filipino ownership shall be applied to BOTH (a) the total number of outstanding shares of stock entitled to vote in the election of directors; AND (b) the total number of outstanding shares of stock, whether or not entitled to vote in the election of directors.”

The highest court of the land very clearly pointed out, and elucidated in most of its decision, that “capital,” when used in computing corporate control, should mean only common shares.

Yet, the SEC ignores that decision, and says that the percentage ownership by foreigners is to be computed using the “total number of outstanding shares of stock, whether or not entitled to vote,” which includes preferred stocks.

A mere SEC circular, in effect, lifted the 40 percent constitutional ban and has allowed PLDT and Globe, both utility companies, to get away with being foreign controlled.

According to Globe’s own data in its November 2014 report to the Philippines Exchange, foreigners own 85.5 million common shares, or 64.4 percent of the total, which is clearly over the 40 percent limit provided in the Constitution and affirmed by the Supreme Court.

(According to Globe’s own list of “Top 100 stockholders,” Singapore Telecom International PTE, Ltd. is its biggest owner with 47.2 percent of the total. Second is Ayala Corp., with 30.23 percent. A further 17.4 percent is held by foreigners, registered with the PCD Nominee Corp.)
However, these 85.5 million common shares make up just 27.2 percent of the total 311 million common and preferred shares, according to the SEC ruling that Globe follows.

PLDT: 54 percent foreign-owned

In the case of PLDT, based on its latest report (April 2014) to the SEC, 54 percent of its common shares are owned by foreigners, clearly in violation of the Constitutional 40 percent limit.

However, PLDT claims foreigners own only 17.4 percent, using the SEC’s memorandum that the percentage is on the basis of total common and preferred shares, which total 660 million.

According to PLDT’s list of its largest stockholders, the Salim-controlled firms Philippine Telecommunications Investment and Metro Pacific Resources have 12 percent and 10 percent, respectively, while the Japanese companies NTT DoCoMo and NTT Communications Corp. together own 16.4 percent. Foreigners, through JP Morgan Asset Holdings in Hong Hong Kong, and the PCD Nominee Corp., hold 20 percent.

PLDT even made an important move in October 2012, which it thought was a clever one that would convince the Supreme Court that it was complying with the 40 percent constitutional limit. It issued 150 million new preferred shares to a strange entity, BTF Holdings – funded entirely by the firms’ pension fund, the Beneficial Trust Fund.

What a sham. It calculates that the shares given to BTF Holdings, which would dilute total outstanding shares, made it compliant with the Supreme Court’s definition of control, as those new shares were given voting rights. But management controls BTF itself, with three out of its five-man board of trustees designated by the PLDT board.

The basic law of the land, the Constitution and the only entity authorized to interpret it, the Supreme Court, say one thing how that foreigners’ extent of control of a firm is defined. The regulatory body, the SEC, tells the firms it regulates to compute it differently, in this case favoring PLDT and Globe’s current ownership structure, which is tightly controlled by foreigners.

What kind of rule of law do we have?

Economists have actually invented a new term for a similar phenomenon in developing countries: Regulatory Capture — elites managing to capture a regulatory body to make it serve its interests, not the nation’s.

I realize many think that foreigners’ control of utility firms does not matter, just as long as they provide efficient services and pay the right taxes.

Two things, though. First, don’t we care anymore about our Constitution and the rule of law, when foreigners trash them?

And an important second point: These foreign firms aren’t really bringing capital in. They are actually bringing capital out. That, on Monday.

PLDT and Globe, however, haven’t really gotten away with it totally. The lawyer who took up Gamboa’s cause, Jose Roy, filed a petition with the Supreme Court right after the SEC issued its memorandum in 2013, claiming that it violated the High Court’s rulings.

The response filed by PLDT has been mainly to claim that if a Court ruling against it could result in an economic chaos, given the firm’s size and the foreign funds that would be spooked. “Too big to be ruled constitutional,” PLDT is basically saying.

And I believe that the Supreme Court, unlike the SEC, hasn’t been, and won’t be, captured.

Filed under: Manila Times Columns

Bane for all of us, boon for Roxas

IF there’s one person in the country possibly looking forward to disastrous typhoons, even visibly enjoying them if you had watched him at his televised “command” conference yesterday barking orders at officials in Borongan, Samar, it could be Interior and Local Government Secretary Mar Roxas.

Leading the government’s preparations and response to typhoons has been Roxas’ biggest, and even only, opportunity to improve his popularity ratings and project himself as a capable leader for the country come 2016.

It is not President Benigno S. Aquino’s nor is it National Disaster Risk Reduction and Management Council (NDRRMC) chairman, Defense Secretary Voltaire Gazmin’s that is this government’s face in responding to the recent typhoon Ruby. It has been Roxas’.

It is, of course, laudable for Roxas to be so compassionate that he’s in the frontlines traversing muddy roads and sleeping in dingy hotels so he could help our countrymen suffering the disaster. Why am I, and many netizens writing nasty posts on reports of his typhoon activities, so cynical?

Well, because it’s so obvious that, for Roxas, typhoons have become a big opportunity, to use a recently invented and popularized slang term, for epal, derived from the term pumapel, which roughly means to appear as having a big role (papel) in some laudable activity.

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Same for-typhoons shirt? Roxas dropping his bike in Leyte the other day, with nasty comments from netizens. Top inset: Roxas in Borongan, Samar yesterday. Lower inset, in Tacloban, Leyte right after super typhoon Yolanda November last year, arguing with a CNN reporter.

 

Roxas, Presidential Spokesperson Edwin Lacierda and their staff even seemed dressed for an election campaign. They were all wearing the same especially-designed-for-typhoon-rescue yellow T-shirts with black bands, emblazoned with the Yellow Cult’s yellow-ribbon logo and the outline of the Philippine archipelago.

Roxas’ credit-grabbing yesterday morning was irritating, if not sickening, as the live televised briefing on the typhoon’s aftermath by NDRRMC Executive Director Alexander Pama (where was the chairman Gazmin, anyway? Sick again?) was interrupted, and replaced, by what was billed by the TV station as “DILG chief’s press conference” in Borongan.

It wasn’t a press conference, but a meeting, chaired by Roxas, of local officials up to municipal officers of national agencies in Eastern Samar purportedly to assess the impact of Typhoon Ruby and the government’s response to it.

It was nothing, though, but a lengthy photo-op for Roxas to show he was busy in the frontline responding to the typhoon. A brilliant move, I would say, as most Filipinos were hungry for news — which surprisingly was sparse —on Typhoon Ruby’s morning-after. Early morning, there was nothing on the typhoon but Roxas’ performance at Borongan.

What was the DILG head doing there, taking over the role of the provincial governor who by law heads the provincial disaster risk reduction and management council? The governor sat idly by Roxas’ side, doing absolutely nothing and just smiling occasionally, with Roxas not once consulting him. Roxas had a notebook and a pile of papers, and was writing notes furiously.

What was Roxas actually doing? Probably to pretend he was in control, he was counting casualties, even interrogating a poor municipal health officer how she got the reported information on deaths and injuries for each barangay. Roxas was irritated when a health officer reported a death during the typhoon that turned out to be due to a heart attack. Roxas barked at the official: “But that’s a “pre-existing” condition, a myocardial infarction.”

With the 2015 budget deliberated on by Congress to give funds to the DILG for activities that in the first place are not even under its responsibility, such as housing, social work, and livelihood projects, a joke started going around that Roxas is the “new Imelda.” That is in reference to his high-profile involvement in so many events and projects as Marcos’ wife did during the last years of martial law, in order to portray himself as Aquino’s successor.

Roxas, though, seems to keep stumbling and bumbling his way through these events in a struggle to make typhoons a boon for his popularity rating.

The script was intended to portray him as a macho man riding a motorcycle so he could navigate dirt roads to inspect typhoon preparations even in Samar’s remote towns. He, instead, took a fall with his bike. (Did his driver’s license allow him to drive a motorcycle?)

A disloyal aide, or a Samar official who probably disliked him, unfortunately managed to snap a photo at the precise moment he fell with his bike, and promptly posted it in cyberspace. It got viral with so many nasty comments, such as a hilarious one that he should be fined for not wearing a helmet.

Roxas should watch it, though. From Mr. Palengke, he might be known as Mr. Typhoon. But in that murky world of people’s consciousness, it might not be his help during typhoons that would be remembered. Instead, he could be associated with typhoons, and the suffering it brings.

PAGASA updates 4-hours late
Our weather forecaster, the Philippine Atmospheric, Geophysical and Astronomic Services Administration (PAGASA), has boasted that the path it predicted for Typhoon Ruby was the most accurate, beating those made by its counterparts in Hong Kong, Japan, and even the US military. They may be right, but for me as a consumer of their information, their forecast was useless.

I had been closely monitoring the typhoon, as its path in the past two days indicated that it could pass directly where we lived, and I was bit anxious that a tree near our house would be uprooted. I also wanted to experience passing through a typhoon’s eye. I’ve read some claims that it is strangely exhilarating when for a few minutes you suddenly see a blue sky (or a starry one) above you in the middle of a blinding fury as the typhoon’s eye passes over you.

I wasn’t able to do so. PAGASA’s purported “hourly” updates posted on its website were all four to five hours late, and I have screenshots of these as proof. Even as I write these words at 4:17 pm Tuesday, PAGASA’s latest hourly update is only for 10:00 am, more than six hours ago at the time of this writing. This has been the case throughout the other night. I even thought that the sudden strength of the wind meant the typhoon was getting close to where I lived. It was five hours later when PAGASA in its hourly update reported that Ruby had veered off to the west and had not passed over us.

Five-, even a four-hour period is a long time in a typhoon’s path. Given its vaunted new equipment, why should PAGASA’s update take that long to issue?

(My three-part series on foreign investments continues on Friday.)

Filed under: Manila Times Columns

What foreign investment restrictions?

First of Three Parts

In the past few months, moves to change the constitution by foreign chambers of commerce to lift purported restrictions on foreign investments’ entry into the country have intensified.

Both Senate President Franklin Drilon and House Speaker Feliciano Belmonte are saying there is enough time under the 16th Congress and during President Benigno S. Aquino’s term to amend the Charter’s economic provisions to make the country more open to foreign investments.

While the issue hardly belongs to his territory, Foreign Affairs Secretary Alberto del Rosario has claimed that the country direly needs to lift its restrictions on foreign capital if it is to participate in new global economic arrangements. As I will argue, though, in subsequent installments of these three-part series, Belmonte and del Rosario’s motives may not be as purely patriotic as they seem to be — their keen interest in charter change may point to the real motive behind all this cha-cha agitation.

What restrictions on foreign capital are they talking about — I mean in practice and not in theory?

Unless you live in the boondocks or in some isolated island in this archipelago, you cannot spend a day without buying – having to buy, actually – a product or a service sold by corporations either majority owned by foreign firms, even exceeding the constitutionally-mandated 40 percent limit for utility companies, or in which these have very significant shares.

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Household brands in the Philippines: Foreign firms have majority or significant shares in them.

When you get up at dawn, and you turn on the lights, you’re buying electricity from Manila Electric Co., controlled by the Indonesian conglomerate which is tightly owned by Anthoni Salim, son of the late Liem Sioe Liong, who had been Indonesian dictator Suharto’s biggest crony. (See my column, Feb. 13, “Indonesian Magnate Controls Meralco.” To date, the Salim group or Meralco has not corrected any single information nor assertion in that article.)

Your breakfast and then your bath are likely to contain products made or distributed by a big multinational. The biggest consumer-products multinationals in the world, the Swiss Nestle and the American Procter and Gamble, have dominated the industry since before the war.

When you take a drink of water, and you live east of the metropolis, you must have bought the water from Manila Water, in which the old-elite Ayalas own just 31 percent, while about 34 percent is shared by the Japanese Mitsubishi Corp., Singaporean firms, and the International Finance Corp. of the World Bank. If you live west of Manila, you’ll be buying water from Maynilad Water, which is 53 percent owned by Salim’s holding firm in the country, Metro Pacific Investments.

For your calls and your internet connection, you’re using Smart or Globe, both of which are controlled and run by foreign firms. The Salim group, through Philippine Long Distance Telephone Co. (PLDT), and Japan’s biggest communications company, Nippon Telegraph and Telephone together own 47 percent of Smart. (See my column, “PLDT now an Indonesian-Japanese joint venture,” March 11). You think the Ayalas are the biggest stockholders of Globe? Nope: it is 47 percent owned by Singapore Telecom. Ayala Corp. has 30 percent, and other foreigners hold 17 percent through the stock market.

If you like to read the newspapers at breakfast, Salim, through PLDT’s Beneficial Trust Fund, has 20 percent of the Philippine Daily Inquirer, and 70 percent in each of Philippine Star and BusinessWorld. Salim is also firming up plans to buy 70 percent of the Manila Standard TODAY from the Romualdezes by early next year.

On your way to the office you stop for gas; if you’re not buying from Petron, you’ll likely be buying from foreign firms’ subsidiaries Pilipinas Shell and Chevron (Caltex), which has been in the country for a century and together have 40 percent of the market.

7-Eleven is Taiwanese
If you stop to buy bottled water at the now ubiquitous 7- Eleven convenience store, guess who controls our 21st century version of sari-sari stores?

No, it’s not the family of the late Vicente Paterno nor Erap’s trade and industry secretary Jose Pardo nor Mar Roxas’ Araneta clan – although each of these, you might say, are ten-percenters, i.e., they each own 10 percent of shares in the firm.

Philippine Seven Corp. is 57 percent owned by Taiwanese President Chain Stores, one of the biggest conglomerates in Asia with 80 subsidiaries and affiliates all over the region. The Texas-based 7-Eleven has nothing to do with the Philippine 7-Elevens, except to collect royalty for the use of the name and logo. (For details see my column June 2, 2013, “Taiwanese firm booming in the Philippines”). As in my columns on Salim, the firm has not corrected any information or assertion in that column.

If you live outside the metropolis, and you don’t want to suffer the terrible traffic of regular roads, you’d have to pay firms to use the toll roads run by companies in which Indonesian firms have majority control.

The South Skyway was built by a company owned by former Indonesian strongman Suharto’s eldest daughter, Siti Hardijanti Rukmana, known as Tutut. Her firms are still in Citra Metro Manila Tollways Corporation, which receives the tolls from there. Salim owns 67 percent through Metro Pacific Investments, of Metro Pacific Tollways Corporation, the largest tollways firm in the country that gets the tolls from the North Luzon Expressway, the Subic-Clark-Tarlac Expressway and the Manila-Cavite Toll Expressway.

And, knock on wood, in case you’re hurt in a terrible car accident in those expressways, you may be brought to the country’s top hospitals majority-owned or run by Salim’s holding company Metro Pacific Investments: Makati Medical Center, Asian Hospital, Cardinal Santos Medical Center, De Los Santos Medical Center, and three others outside Metro Manila.

But if you’ve driven safely home and have relaxed to watch TV, you’d likely be using the services of SkyCable, 40 percent owned by the Singapore firm STT Communications Pte. Ltd., or of Cignal TV, controlled by the Salim group through MediaScape, which is funded by PLDT’s Beneficial Trust Fund.

What restrictions are they talking about, when Starbucks has 226 stores here, more than those in any European country and most countries in Asia, which are ostensibly more open to foreign investment?

I’d be very interested to know how they’re doing it, but the Tantoco (Rustans’) Group of Companies, one of whose subsidiaries is the Starbucks Philippine partner, and the Henry Sy conglomerate, have been so successful in being the venue for the massive entry of foreign retail stores (such as the Japanese Uniqlo) into the country in recent years.

Most of these foreign firms operating in the Philippines have simply taken advantage of our liberal economic policies. However, the big question, though, is how Salim and the Ayalas have managed to skirt the constitutional provision limiting foreign ownership in utility industries, which include electricity distribution and telecommunications.

The answer is contained in a notion economists have invented to explain market failures: Regulatory Capture.

And you’ll find it shocking how a nondescript government entity – the Securities and Exchange Commission, the regulatory firm “captured” – has on its own, in effect, lifted the 40 percent limit on foreign companies’ ownership of utility firms, clearly specified by the Constitution and upheld by the Supreme Court.

That on Wednesday.

Filed under: Manila Times Columns

One big economic reason to have an Aquino-free nation

One of the biggest reasons why even an important sector of our business community can’t wait to have President Benigno S. Aquino 3rd step down, and for a totally new regime to take over, involves our territorial dispute with China in the West Philippine (South China) Sea.

To bolster his regime, Aquino roused—quite successfully I would think—the Filipino nationalist sentiment by his belligerent rhetoric against China regarding our claims on the Spratly islands, as well as the Scarborough Shoal. By filing an arbitration case against China on the dispute in January last year, and pressuring Asean to take a stand against China over it, he has closed off any bilateral resolution to the dispute.

In his second state of the nation address he boasted: “Now, our message to the world is clear: What is ours is ours; setting foot on Recto Bank is no different from setting foot on Recto Avenue.”

Both the Americans and the Chinese must have shaken their heads in disbelief at such a stupid analogy made by our President. His reference to Recto Avenue may sound smart-alecky, but it was childish braggadocio, revealing his ignorance of our territorial dispute.

Recto Avenue is a main thoroughfare in metropolitan Manila on our biggest island of Luzon. On the other hand, there is hardly any dry land to step on at Recto Bank, internationally called Reed Bank. It is the 8,866 square kilometers of waters 9 to 45 meters in depth, atop a geological formation called a Guyot (after Swiss-American geologist Arnold Henry Guyot) consisting of submerged volcanic mountains and coral reefs.

The Mutual Defense Treaty of 1951 – a very brief pact of just 625 words, or less than half this column’s length – requires the US to come to our rescue if there is an “armed attack” against the Philippines.

Recto20141205
What’s the story? Reed (Recto) Bank in disputed waters, potentially a huge oil and gas find. Inset: Right top executive Manuel Pangilinan with his former close associate now Foreign Affairs secretary Alberto del Rosario. One irks the Chinese, the other woos them.

However, Article V defines what an “armed attack” is, which is one “on the metropolitan territory of either of the Parties, or on the island territories under its jurisdiction in the Pacific Ocean, its armed forces, public vessels or aircraft in the Pacific.”

Reed or Recto Bank isn’t a metropolitan territory or an island territory. We have claimed the area as part of our 200-mile exclusive economic zone, as defined by the United Nations Convention of the Law of the Sea (UNCLOS) of 1982. The 1951 Mutual Defense Treaty hasn’t been revised to include a new definition of our territory under UNCLOS. Worse, the US hasn’t ratified UNCLOS; therefore, how could it invoke what for it is a non-existent treaty?

Based on the treaty’s Article V, the only way for us to draw in the Americans to defend us in Reed Bank is to provoke the Chinese to attack our “public vessels.” Probably that was the real motive of our puny Coast Guard boats confronting Chinese ships a few months ago.

Aquino, however, may have unwittingly highlighted a key element in the dispute that could have tremendous impact on our economy: the Reed Bank. It is believed, but not by everybody, to have huge oil and gas deposits with the most optimistic claim that its gas deposits could be five times bigger than the nearby Malampaya gas field, which has been supplying Luzon 40 percent of its energy requirements.

Not academic
These are not just academic estimates. Philex Petroleum – which is ultimately controlled by the Indonesian conglomerate, the Salim group, and headed by well-known top executive Manuel V. Pangilinan – has teamed up, through its UK subsidiary Forum Energy with billionaires Enrique Razon and Roberto Ongpin to bet that its Service Contract No. 72 in the Reed Bank contains world-class commercial oil and gas reserves.

The firm’s plans to send drilling ships had been stymied when our territorial dispute with China flared up in Scarborough Shoal off Zambales island further north, and after Aquino, as well as his foreign secretary Alberto del Rosario, made belligerent statements against China, calling it a bully in the region. The Chinese harassed a ship commissioned by Forum Energy to survey the Reed Bank area in March 2011, although our armed forces claimed they sent vessels to escort the ship to complete its work.

China has rejected offers by Philex Petroleum for a “Framework Agreement” with China National Offshore Oil Corporation, to which it had given exploration rights in Reed Bank, that would allow both firms to explore the area to determine if there are really commercial gas and oil deposits there.

This is where things get murky, but interesting. Senator Antonio Trillanes 3rd is convinced that del Rosario has deliberately been raising tensions with China (see my column “Trillanes: DFA chief deliberately worsened PH row with China,” Nov. 30). Del Rosario’s motive, he says, becomes obvious if one remembers that the foreign secretary had been a close friend and associate of Pangilinan, having been on the boards not only of Salim’s firms here in Manila but of the holding company First Pacific Co. in Hong Kong itself. (Not only that, from the start of his activities in the country in the 1980s, it was del Rosario who introduced him to Manila’s business world.)

Trillanes claims that Pangilinan has realized that there are no viable commercial oil and gas deposits in Reed Bank, pointing to an internet report of the US Energy Information Administration.

Trillanes claims that because of del Rosario’s moves and statements that raised tensions with China, that superpower will be blocking any further exploration at Reed Bank by Philex Petroleum. “Once drilling starts, the true (noncommercial) value of the reserves in SC72 would be known and MVP’s (as Pangilinan is often referred to) partners/stockholders at Forum Energy would start bailing out,” according to an aide memoire written by Trillanes. “MVP stands to lose billions, ” it said.

“This explains the antagonistic stance of Sec. del Rosario toward China,” the document concluded. “He just needs a continuing pretext to delay the drilling until MVP finds an unwitting buyer of their stake and leave their other partners/stockholders holding the empty bag, “ according to Trillanes’ paper.

“Total Fiction”
“An old story, and a total fiction,” Pangilinan replied to my query on the matter. “Not true at all. We have long been wanting to drill, but geopolitics got in the way. The latest iteration is for us to do a seismic survey next year to establish the baseline ecology of SC 72, and determine the stability of the seabed where we might eventually drill.”

Pangilinan explained: “This will be followed by drilling of two appraisal wells in 2016. That’s the latest work program we’ve submitted to the Department of Energy.”

He pointed out: “Now as to whether we can execute or not this program is another matter, as it will be determined largely by geopolitics, over which we have little influence or control. For the record, Sec. Albert del Rosario does not get involved at all with the business of SC72. We make sure there’s a Chinese wall between business and government on commercial matters, despite what some may allege to the contrary. And with respect to our work program on the concession, we report to our regulator, the Department of Energy, not DFA.”

Pangilinan may be right, but what’s indisputable at the moment is that China has given up on Aquino, and has adopted a hard stance against us on the territorial issue as long he is in power.

A win-win solution his predecessors had adopted was to put the sovereignty issue in the background, and for both countries to explore joint undertakings in the disputed area. The most important of such projects, as Pangilinan himself had offered his Chinese counterparts, would be, first, joint exploration, and if that works out, then joint exploitation with an equitable sharing of profits.

“The harsh reality,” an expert on the dispute said, “is obviously that we’ll lose humiliatingly if we fought a shooting war to claim our territories on the Spratly islands.”

“But with a sober leadership, there could have been a possibility for even a 50-50 sharing of the gas and oil found at Reed Bank or elsewhere, which for our country, dependent on imported oil, would have been a boon,” he said.

Filed under: Manila Times Columns

EDCA: The price of Obama’s visit last April

The “Enhanced Defense Cooperation Agreement” (EDCA) was the price President Benigno S. Aquino 3rd paid to get US President Barack Obama to make a state visit to the country last April.

The problem is, as Senator Miriam Defensor-Santiago has argued, it wasn’t something Aquino could give away on his own. The Senate must ratify it.

The Constitution is quite clear on the matter. Section 25, Article XVIII, says: “Foreign military bases, troops, or facilities shall not be allowed in the Philippines except under a treaty duly concurred in by the Senate.”

Aquino’s claim that EDCA merely implements the Visiting Forces Agreement, ratified by the Senate in 1999, is utterly absurd.

The VFA merely clarifies the legal framework for routine matters—things like visa requirements, duty-free status of US forces’ imports, and, jurisdiction over US personnel committing crimes – involving US armed forces personnel participating in joint military exercises with the Philippine military in our territory. And even if the VFA merely implemented the Mutual Defense Agreement of 1951 that provided for joint military exercises, the Senate was required to ratify it.

military20141203
The US’ military treaties with Bulgaria and Romania were nearly the same, with few very important differences, though.

 

The Aquino government’s claims had prodded Senator Santiago, chairperson of the Senate’s foreign relations committee, to exclaim: “My goodness, the Mutual Defense Treaty [is so old]…. It is over 50 years old. How can a treaty in 2014 be the implementation of a treaty made as far back as 1951? They are stretching it too far,” Santiago said.

EDCA is a radically different pact. It will convert parts of our military bases into the US armed forces’ “forward operating sites” where they can stockpile and pre-position its war materiel, and which they can use as jump-off platforms when they go to war.

If the Senate does not ratify EDCA, we will not only be diminishing its stature. We will be trashing the Constitution just to bow to a new US global military strategy.

We will be shaming ourselves as a nation: exactly similar military treaties by the US with two other countries, Romania in 2005 and Bulgaria in 2006, were ratified by the two Balkan countries’ parliaments before they could take effect.

Do these nations value their sovereignty more than we do ours?

It seems so, as Aquino rushed the signing of EDCA in order to prettify his regime. He had been desperate for President Obama, the head of the world’s sole superpower and our former colonizer, to visit the Philippines. Time was flying fast toward his last years in office and he faced the prospect of being the only post-war Philippine President not to have been visited by an incumbent US president. Last April was the only possibility for an Obama visit, as he was scheduled for must-visits to Japan and South Korea.

The US must have told Aquino: “Either we have the EDCA signed or no Obama visit.” Aquino ordered the talks rushed, so that he summarily replaced in March Ambassador Carlos Sorreta, who had been the negotiating panel’s chairman since 2012, as well as the foreign affairs department’s expert on American affairs. Sorreta, a protégé of the nationalist former foreign affairs secretary, the late Blas Ople, was raising too many questions over the proposed treaty.

Kicked out
So he was kicked out and replaced by a professionally mediocre 42-year old defense department undersecretary for legal affairs, Pio Lorenzo Batino, whose knowledge and experience in diplomatic negotiations (or even in any kind of negotiations) was zero.

The US government, on the other hand, had assigned one of its top trouble-shooting diplomats, former Assistant State Secretary for Intelligence Philip Goldberg, to head its panel, appointing him as ambassador to the Philippines in November 2013 as justification for that role. As soon as the Senate clears EDCA—if ever, that is—or if it is thrown into the dustbin, expect Goldberg to be assigned elsewhere immediately. EDCA has been his mission here.

The Americans sent a clear message they weren’t bluffing in their no-EDCA-no-Obama threat by scheduling his visit to the Philippines last in his four-country tour. If, for some reason, EDCA wasn’t signed, they could have invoked the flimsiest reason for Obama to rush home instead and cancel his visit to the Philippines.

Why, the Americans even required the EDCA to be signed before Obama set foot on Philippine soil. It was, indeed, inked (by Defense Secretary Voltaire Gazmin and US Ambassador Philip Goldberg) while Air Force One was airborne after taking off from Kuala Lumpur, Malaysia—a precise timing that would have allowed Obama to cancel his visit if for some reason he didn’t get the EDCA.

The US wanted EDCA to be implemented without the Senate’s ratification since the Senate could have rejected, as a similar treaty with Romania nearly would have been. It was ratified only after intense debate in its Chamber of Deputies and its “Senat” in May 2007—17 months after US State Secretary Condoleeza Rice and her Romanian counterpart signed it. Yes, in the case of its “EDCA” treaties with Bulgaria (population: 7 million) and Romania (21 million) treaties, the US sent its top diplomat, its State Secretary to sign the pacts; in our case it’s just the ambassador to the Philippines who did so.

The EDCA is not a unique agreement. It hews closely to the US’ new template in its global projection of its military power: Less permanent bases, and more “forward operating sites,” as Pentagon jargon calls these, which could be rapidly transformed into bases when needed.

Dubbed “lily pads” by the Pentagon, “such sites would allow rotational or periodic access for training purposes while also providing readily expandable facilities with pre-positioned equipment,” states a study of the European Center for Security Studies. This was, the study pointed out, America’s “new, cost-effective (read: cheaper) basing paradigm” in the 21st century.

FOS against China
With EDCA, the US will be making the Philippines its forward operating site in Asia, obviously positioned against the only other military power in the region, China, just as Bulgaria and Romania were, in their case, against Russia.

Many provisions in the Philippine EDCA were lifted verbatim from the US agreements with Bulgaria and Romania. Only the word “enhanced” was added to the “Defense Cooperation Agreements” title of the pact the US signed with Bulgaria. This was intended to falsely portray it as an extension—an “enhancement”—of the VFA and the much earlier 1951 Mutual Defense Treaty.

If you read the treaties with the two Balkan states, and then the recently signed EDCA, you’d conclude that the Americans simply pulled out of their filing cabinet the Bulgarian and Romanian treaties, and just replaced the word “Philippines” for Bulgaria or Romania.

There is a very important difference, though, in the Philippine EDCA compared with those of Romania and Bulgaria, showing the Aquino government’s utter capitulation to the US.

The treaties of the two Balkan countries categorically provide that only 2,500 US military personnel may be deployed in each of their countries at any time. In case of an overlap of two deployments, a maximum of 5,000 US troops may stay in their countries, but only for three months.

In our case, there is no such limit to how many US troops the treaty allows to be deployed in “agreed locations” in our military camps.

They could even deploy a US Special Forces division of 25,000 troops—which could certainly be accommodated in their former bases in Clark and Subic — and Aquino’s treaty would allow that. The EDCA, therefore, could make us the US’ “biggest military base in the world.”

We could debate until we get hoarse whether EDCA would be beneficial to our country or not. What is certain, though, is that if the Senate reneges on its duty to put it under its scrutiny and for it to decide to ratify it or not, it will very seriously weaken our Constitution’s integrity and our sovereignty.

This Senate could go down in history as an institution that was so servile to a President who was so servile to a foreign power.

(The second part of my report on our territorial dispute with China, and Senator Antonio Trillanes’ allegations regarding government’s mishandling of it will be published Friday, since I had to get the “other side,” as I always try to do. In this case it is that of a prominent personality the senator accused as having a role in the matter: PLDT and Philex Chairman Manuel V. Pangilinan.)

Filed under: Manila Times Columns