Legacy of Corruption

Speech before the Rotary Club of Makati, The Peninsula Manila

Only last Friday, I was here in Makati joining tens of thousands of our countrymen who represented tens of millions of other Filipinos who thought enough is enough of corruption and cover-ups yet unprecedented in Philippine history.

The government’s response is, the economy is doing great. That the peso is relatively stronger is a fact. That the economic indicators show good numbers is another fact.

But the numbers are still leaving a lot of us out. 

Everyday, public transport drivers, factory workers, vegetable farmers and even office workers complain that they do not earn enough to meet even their most basic needs. A great majority of our people has remained poor by the lowest of standards.

If we plan to eliminate poverty, we must plan first to eliminate corruption.

Corruption has become an institution to such an extent that we no longer talk about the presence of greed. Moderating it has become a present day virtue.

And respond we must, with the larger obligation to instill integrity even in our daily lives.

Much of our power to make change grows out of the power of our own examples.

In 1999, when I was appointed Chief of the Philippine National Police, I inherited an agency that stood for good values and integrity in name only. Nobody respected the police and we were only followed because we had guns and therefore we had power.

It would have been easier for me to simply not rock the boat. Go with the tide, they told me, no drastic changes in decade-old policies of corruption – get the usual share of jueteng payola, get the standard 20% commission on supply and contract signed, avail of the P40M-a-year so-called command and commander’s reserve, then enjoy the loot in retirement. No controversies, no enemies – neat indeed!

But I chose to stick to my principle – What is right must be kept right. What is wrong must be set right.

The results were good and very encouraging. Corruption among my policemen was at its lowest during that time. My policemen were disciplined, even became physically fit to perform their duties and mission of keeping the peace and serving our people.

The formula I followed was simple enough – Leadership by example. I was not stealing from the funds of the PNP. I was not accepting bribe money from jueteng and other illegal activities. Eighty-five per cent of the PNP funds, including the commander’s reserve were downloaded to the frontline units, giving them good reason to do their job, and properly. Before my time, it was 60-40. 60% at headquarters and 40% to the frontline units.

My men had no excuse to stray. In fact, they were either afraid or just simply motivated to toe the line.

This is in sharp contrast to what this current government is doing.

Being a Rotarian myself, I know that fellowship and laughter are the essence of our club meetings. Let me break the tradition.

Let me talk about corruption and greed.

You have to bear with me. The list is long and nauseating.

Corruption No. 1. Barely a week after Gloria Macapagal Arroyo took power from Joseph Ejercito Estrada her justice secretary, a Batangueno named Nani Perez signed an opinion that allowed sovereign guarantee over a power plant rehabilitation contract that the government she succeeded refused to grant. IMPSA got its sovereign guarantee in exchange for 14 million US dollars in commission. The monies went through circuitous global routes, from Uruguay to the Caymans, and 2 million dollars of the loot finally traced in Switzerland.

I myself tried to re-trace the route, and my sleuthing went as far as a branch of the very private Coutts Bank in Hong Kong. Months later, no less than the Swiss federal authorities discovered that from Coutts it went to EFG in Singapore, and thence to their vaults.

President Gloria Macapagal Arroyo did nothing except to accept “with regrets” and a kiss the resignation of that extremely powerful Cabinet member two years after. There is a case languishing in the Ombudsman’s office up to now, despite what lawyers would call “an open and shut case”.

That crime of corruption happened seven years and two months ago. And all we know is what happened to 2 million dollars. Whatever happened to the rest of the 14 million dollar loot? Your guess is as good as mine.

Corruption No. 2. In 2001, the new administration discovered that a telecommunications expert, Pacifico Marcelo, was granted license to operate by the National Telecommunications Commission during the previous administration. Seeing big business opportunities, this new leader personally met with the licensee and, behind the curtains that surround a portion of the walls of a hall in Malacañang, asked that he turn over 55% of the corporation to her assigns.

He refused. He was hounded. In the Senate itself, her minions harassed him no end. He had to flee to the United States for fear of his life.

Corruption No. 3. The previous administration rushed a wide avenue that would run parallel to Roxas Boulevard, in order to lighten up the traffic to and from the airports. The highway, already almost completed, was negotiated for a price of 650 million pesos. When this administration took over, they presided over the completion of the boulevard, but the price had ballooned to 1.1 billion pesos. Almost double the original cost because of “change orders” and landscaping.

GMA inaugurated the avenue, on her birthday, and named it after her father. The Diosdado Macapagal Boulevard, 2.2 kilometers long at half a billion pesos per kilometer, is now known as the most expensive boulevard in the universe.

Corruption No. 4. In the second-half of the year 2003, I discovered a cache of documents, originals as well as photocopies, pointing to a huge money-laundering scheme by a certain Jose Pidal, whose signature on checks, even to a cross-eyed person, was uncannily similar to the strokes of the signature of one Jose Miguel Arroyo.

The person who provided these to me was a certain Udong Mahusay, confidante, coffee maker and wine server to the First Gentleman and a lady named Vicky Toh, mostly in the 8th floor of LTA building in Urea St. in Makati, He was to stand as my witness against Jose Miguel Arroyo’s web of corruption. Many things happened thereafter. Someone else stood up to claim he was the real Jose Pidal. He is now Honorable and Distinguished gentleman from the third district of Negros Occidental, at that time paying a mere P8000 in income tax, but now has a declared statement of assets and liabilities and net worth of more than P200M. Mike Defensor shanghaied Udong Mahusay and flew him by presidential helicopter to the waiting arms of a highly-relieved Malacañang. And all sorts of lies, all sorts of cover-ups, by officials and agencies of government thereafter transpired.

Corruption No. 5. Running for election in 2004, GMA met with election operators and Comelec officials in her own house in La Vista, Quezon City. By that time, she had appointed as commissioner Virgilio Garcillano, Garci, for short. To ensure that the election operations that would make her win, she distributed tons and tons of money from jueteng, augmented by a re-enacted budget, on top of serving “kulay violet na pansit” to her house guests that included Garci’s nephew named Michaelangelo Zuce.

No. 6. And, who can forget another a jet-setting Rotarian named Joc-joc Bolante? He who perfected the science of getting favored suppliers to produce a concoction of water and urea, at 9 parts to 1 in bottled form, overpriced these 15 to 1, and had these distributed as liquid fertilizer to congressmen and governors all over the land. So blatant was the scheme that even districts with no agricultural lands were given the Joc-joc fertilizer. The Commission on Audit no less unearthed 729 million pesos in such patently illegal disbursements. What lies beneath the bureaucratic maze is estimated at another billion pesos or more.

No. 7. Ah, then came Hello Garci, the taped conversations that clearly showed how Gloria Macapagal Arroyo conspired with an election commissioner, using as instruments in cheating even those who should otherwise be presumed as “officers and gentlemen” in the military and police. Some other so-called “officers and gentlemen” were used yet again to abscond and keep one Sgt. Vidal Doble, that ISAFP operative who tapped Garci’s phone right inside Camp Aguinaldo’s Intelligence Service.

Unable to deny a voice that is singularly and uniquely hers, she pleads “I am sorry”, but when articles of impeachment are filed against her in Congress, she uses all the powers and perks to buy off the representatives of the people, in order to hide truth and cover-up for guilt most obvious. Acting as cash register to the release of pork and perks was then Secretary of the Department of Budget and Management, one Romulo Neri, who would later metamorphose into the country’s chief economic planning agency, with responsibility to review all foreign-assisted projects.

She successfully thwarted two impeachment attempts by the tried-and-tested method of lying through spin masters, and though the help of stolen gravy distributed to the honorable members of the lower house, local government officials and the uniformed generals

Let me at this point backtrack into the year 2004, when, flush with “election victory”, she sallied forth to China, that once poor neighboring Communist country which then maintained a bulging reserve of more than 2 trillion dollars. Willing to spread goodwill and promote its economic interests, this country has been winning new friends in Africa, South America and Asia by granting official development assistance. Poor Philippines, which claims islands and waters China likewise covets, was an easy target. Its soft state, presided over by this “good” leader, found the foreign country’s lending binge a magnet for all kinds of deals.

I shall no longer belabor you with the details of this scandal most larcenous. Suffice to say, I have now in my possession a copy of an Agreement for Joint Marine Seismic Undertaking in Certain Areas in the South China Sea By and Between China National Offshore Oil Corporation and our very own Philippine National Oil Company, both agencies representing their respective governments.

While this agreement, signed on September 1, 2004 is couched in very general and vague terms, there is no escaping the fact that it covers a total area of 142.886 square kilometers. My fellow Rotarians, the total land area of the Republic of the Philippines is estimated at around 300,000 square kilometers.

This is probably the scandal to beat all scandals of this administration. Perhaps, this is the worst that this leader could to her country: to sell its territorial sovereignty and integrity in exchange for billions in loan packages from the Chinese government, billions that we and the next generation would have to pay as debt, billions that we all know will line the pockets of the few.

There are many more, some have escaped our scrutiny. While I will now stop the count, you and I know the counting does not stop.

At any rate, from the time I exposed the onerous ZTE-NBN supply contract on the floor of the Senate last August, which triggered the investigation now unfolding before us as you have seen most of the gory details unmasked through media, we have become angry witnesses to more cover-ups and lying so bad, that young and old people, professionals and peasants, religious and sinners join together to condemn and say, “sobra na, tama na”.

Over the years, we have never been lacking in expert advices by which governments and leaders can stop corruption. From avoiding too much discretion by public officials to systemic means of simplifying transaction procedures, to the strictures of open and transparent public bidding, to E-procurement, even to increasing the penalties for graft and raising incentives to honesty and performance.

All these are good, but only in the hands of a truly good leader.

For a “dysfunctional procurement system” as Jun Lozada describes it, thrives only when functional systems are distorted by the wielders of power to favor their personal selfish interests — their immoderate greed.

But I have to disagree with this distinction made between what is moderate what is excessive. We cannot build a polity by demarcating permissible zones of crime and corruption.

We are where we are now — mired in the deep shit of corruption, because in the past and up to the present, we as a people tolerated “small” graft, be it the “kotong” of cops, or the “padulas” for clerks in regulatory and licensing agencies.

Now we are appalled because the commissions exceed the fair price of a project, in the case of the ZTE-NBN deal, how 130 million dollars in work value ballooned to 329.5 million dollars, an overprice of almost 200 million dollars, or 8.2 billion pesos in present value.

So how do we excise the “kotong”, the “padulas”, the “lagay” as lower members of the anatomy of corruption? By proper systems which “evil geniuses” in the mold of Joc-Joc and some incorrigibly corrupt BIR and customs agents will always find ways to circumvent?

How do we compel public works engineers to build roads and bridges that will stand the test of time and the elements, if 40% must perforce go to the district leader — the congressman, or the provincial leader — the governor?

This SOP of corruption is my principal reason for foregoing my 200 million peso-a-year “pork barrel fund”. Every legislator, whether guilty of exacting commissions or not has become suspect. I simply refuse to become a suspect.

In the final analysis, my fellow Rotarians, the fight against corruption needs a North Star to follow. It cannot be a bishop or a cardinal or any religious leader, however wise his admonitions of morality. It cannot be anyone else than the head of agency in the executive department. Or the local elected executive in city or province.

For a leader cannot compel obedience to the right, if he or she chooses what is wrong. One can dissemble and pretend to be “good” only up to a certain point. The truth will always out.

Leaders, or those who hope to be, will always come up with so-called visions of good governance and sound economic policy.

But public morals are an immutable value. They cannot be cheapened by qualifying zones of permissibility. They cannot be buried by the permissibility of a tainted leader. They cannot be forever hidden by a corrupted justice system.

So, what do we do about shameless corruption in this country?

It is once said that to sin in silence, when they should protest, makes cowards of men.

I am posing this challenge to you my fellow Rotarians – In the midst of all these, shall we continue to sin in silence, or, is it time to lend our voice of dissent to the youth and students, the religious, professionals, and even businessmen like most of you, and do our share, no matter how small and insignificant we think it might be?

Your answer, our answer lie in our conscience.

Thank you and good day.