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Why the Lopezes fought Marcos, and helped the communist fronts

Second of a series on the Scalice revelations
WITH the franchise for the Lopez clan’s ABS-CBN broadcasting network still in limbo, it would be very informative to look at this oligarch’s history, why it fought Marcos (and was depicted after his fall as noble pro-democracy tycoons) and how powerful its media empire was, so formidable that only Marcos’ martial law could stop it.

What follows are not my claims, but a narrative on the Lopezes from a meticulously researched PhD dissertation by Joseph Scalice, submitted as a requirement for his doctorate at the University of California in Berkeley.

Scalice writes:
“Like Marcos, Vice President Fernando Lopez was reelected in the 1969 elections but in the immediate aftermath of the election, Lopez and Marcos had a falling out with explosive political consequences. Noted historian Lewis Gleeck stated that, ‘The relationship of President Marcos, the political sovereign, and the Lopez brothers, the economic giants, was always an uneasy one … In the beginning, each needed the other, but in the end only one, of course, could be top dog.’ The Lopezes were not to be taken lightly, as Benigno Aquino Jr. made clear in his apt description of their political influence:

“‘The Lopezes are the only family that has consistently stayed on the fringes of power since 1945, when they came to power with Roxas. Consistently they have been the giant killers. Consistently they have been the manipulators of political balances in this country. When they abandoned Quirino and the Liberal Party in the 1950s, there was a stampede out. When they joined the Magsaysay bandwagon in the 1960s, they forced Garcia down.

Marcos maneuver: His peace offer to the Lopezes – in May 1972. (From Raul Rodrigo, 2007)

“‘Then Macapagal came; but in two years the Lopezes were able to bring about a crisis of major proportions against him, and so bring on his downfall. And it was the Lopezes who engineered the coup of Marcos. Very few people know this, but it was the Lopezes who financed Marcos against Senate President Amang Rodriguez to win the support of the Senate. All right, they rode with Marcos. First term. Now they are abandoning Marcos. The giant killers are again true to form.’

“What makes them so deadly?

“One: their control of media. They have one of the best radio and TV networks in the country. Two: their political base. Having been in power since 1945, they have many people ‘beholden to them, unknown numbers of people in the bureaucracy, in the judiciary, in the political field. Faceless at this moment; but when the chips are down, these people surface.’”

Fight to the end
“Third: their reckless use of funds. When they fight they put in everything. So, groups of politicians gravitate around them. Fourth: the Lopezes are known to fight to the end. Other people you feel inhibited about joining them, for fear they will abandon you in mid-fight. Not the Lopezes.’

“The rancor between Marcos and Lopez was precipitated by the economic crisis. The business interests of the Lopez family felt the impact of rising prices and they sought relief from the Marcos government; Marcos in turn sought a larger share of ownership in a lubricating oil facility the Lopez brothers were intending to buy.

“In exchange for approving the deal, he asked for 40 percent ownership, but the Lopez brothers insisted on 15 percent. The haggling turned into open political conflict in the first quarter of 1970, which was followed by a temporary reconciliation. When Marcos raised the import duty on crude oil in December from 10 percent to 15 percent, ‘to cover the government deficit,’ the operating costs of Meralco, the Manila Electric company owned by the Lopez brothers, went up significantly.

“[Raul] Rodrigo* writes: ‘By 1971, Meralco had incurred a large dollar-denominated debt that it would have a difficult time repaying under its current cost structure and rates. On top of existing debt, it also needed to access an additional P1 billion in financing over the years 1971 to 1972 to finance construction of new plants and the expansion of the distribution network. The only way for Meralco to survive was to secure a rate increase from the government to keep pace with rising costs. The trouble was, Malacañang held the key to any rate increase.’

“The Lopez brothers threw themselves back into political battle against Marcos at the end of the year. Eugenio Lopez made Renato Constantino a regular columnist of the Chronicle, and Constantino used this column to satirize the first couple for their gaucheness and gaudy practices. It was a public humiliation, but it was not a political exposé.”

Radical propaganda
“Cornell University scholar Patricio Abinales correctly notes: ‘Radical propaganda got a great boost when Marcos’ discarded allies, notably the Lopez and Laurel families, sensing that he was faltering, announced their sympathy with ‘the revolution’ and opened their media outlets to student radicals. The television stations and newspapers highlighted demonstrations… Suddenly, a relatively small left-wing group (the Communist Party of the Philippines or CPP) became a major national player, thanks to the political opportunism of anti-Marcos elites. When Marcos warned of an unholy alliance between radicals and oligarchs, therefore, he spoke the truth.

“On Jan. 8, 1970, in the lead-up to the First Quarter Storm, the Chronicle published an editorial, ‘The Students and the Press,’ announcing a shift in the policy of the paper to provide sympathetic coverage of the students, particularly in the face of police brutality. The paper wrote that the police were ‘uniformed bullies’, ‘illiterate’ and ‘incapable of understanding the most trivial of sentiment in the student mind,’ and called for ‘demonstrators — meaning the student activists — to be dealt with fairly and not just in the columns of the press.’

“It called for an end to the ‘glamorization of police brutality and the denigration of the young.’ The Chronicle was not alone in this editorial shift, for Marcos had alienated a good deal of the remaining press by cutting dollar allocations for their newsprint. ‘Freedom of the Press without newsprint?’ asked the Philippines Free Press. The FQA protests received overwhelmingly sympathetic press coverage.

“Mark Thompson, a Yale University PhD specializing on the Philippines, identified five major factions in opposition to Marcos that came into alignment between 1970 and 1972: ‘Aquino; Laurel; Osmeña; Roxas; and Lopez. Each was a dynasty of the landed elite. The leading collaborators during the Japanese occupation, they had been immediately rehabilitated by Washington in the wake of the war and were now the most politically powerful families in the country.’

“The feuding dynasts did more than provide the CPP with favorable press coverage; they directly and generously funded its front organizations, provided salaried positions to some of its leaders, and granted the demonstrators nearly daily access to broadcasting rights on their major radio and television networks. Behn Cervantes wrote, ‘Since this was the crest of the First Quarter Storm, it was relatively easy to get contributions [for the KM and SDK] from big business tycoons.’ Not only the Lopez brothers, but also Aquino, Ramon Mitra and John Osmeña were actively engaged in funding the front organizations of the CPP, particularly the KM. The allied elite opposition helped plan, pay for, and give favorable press coverage to the rallies.”

Marcos’ astuteness
Marcos, however, demonstrated his political astuteness when he outflanked the Lopezes in May 1972, a few months before he would put the country to a one-man rule in September, which enabled him to end the Lopezes oligarchic for fourteen years — resurrected however by Corazon Aquino to nearly recover their pre-martial law power.

Scalice continues:
“In the first weeks of May, Ferdinand Marcos and the Lopez brothers made peace. Marcos revealed the acuity of his political insight in his recognition that the giant of the opposition was its weakest link. The dispute within the Liberal Party deeply concerned Fernando and Eugenio Lopez, as they saw their clout weaken at a time that their business interests were deeply imperiled.

“By early 1972, Meralco was in a deep hole because of a combination of its high costs, interest rates rising out of control and outdated power rates. In March 1972, it filed an application with the Public Service Commission for a rate increase of 36.5 percent. The next presidential elections were not until November 1973. Under the most optimistic scenario, even a change to a sympathetic administration meant that Meralco would not get rate relief until nearly two years later — an eternity given the scale of the financial shortfall. So a ceasefire — if not necessarily a lasting peace — was vital to Meralco.

“To carry out his ends, split the opposition, and launch the last preparations for martial law, Marcos had to make the reconciliation with the Lopez brothers look like a defeat. He humbly petitioned them to resolve the dispute in April, offering conciliatory terms.

“The Lopez brothers would not come to Malacañang, and so on May 10, Benjamin ‘Kokoy’ Romualdez, the brother of Imelda Marcos, personally drove Fabian Ver and Marcos to Lopez’s house, where they concluded the negotiations. Marcos granted Meralco its rate increase and the Lopez brothers immediately altered the oppositional stance of the Chronicle and ABS-CBN.”

It wasn’t coincidental that in the months leading up to the imposition of the Marcos dictatorship, the demonstrations of the communist youth fronts subsided both in numbers and frequency, with few believing the claims then of Ninoy Aquino that his arch-enemy was set to declare martial law. The Lopezes apparently believed Marcos had been tamed. Why else would he seek peace with them? Indeed most of the opposition leaders — even Aquino himself — were arrested in their homes or having cocktails at a hotel.

The clan’s heir apparent, Eugenio Lopez Jr., was arrested two months after martial law together with the scion of another oligarchic family, Sergio Osmeña 3rd. Charged with attempting to assassinate Marcos, they would manage to escape prison five years later.

*Rodrigo, Raul, The Power and the Glory: The Story of the Manila Chronicle, 2007. The book was commissioned by the Eugenio Lopez Foundation.

In my column Monday, “PhD thesis details Ninoy Aquino’s collaboration with Communist Party/NPA,” I wrote that Joseph Scalice’s father-in-law Herminio Aquino is Ninoy Aquino’s uncle. This is false. His father’s is only a namesake of Aquino’s relative. He does not have any relation to the Aquino family. My sincerest apologies.




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