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Erroneous focus on altering the Constitution

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AFTER much thought and research, I am convinced the recent kerfuffle over amending or revising the Constitution is so misplaced — I’m close to using the adjective “mindless” — that its hidden goal, as it was when President Fidel Ramos first tried it, is merely to establish a parliamentary system that would be a venue for House Speaker Ferdinand Martin Romualdez’s ascension to power.

There are more pressing matters for Congress to tackle, among them our electricity rates, the highest in the region and double that of Vietnam and China, the two countries that have been the favorite destination of foreign capital in the past two decades.

The Senate move to have only the Constitution’s provisions restricting foreign investments lifted is simply a diversionary move in response to the House of Representatives’ campaign through the dubious bungling outfit Pirma (People’s Initiative for Modernization and Reform Action) to establish that parliamentary system.

Except for Sen. Sherwin “Win” Gatchalian, who gullibly believed the OECD (Organization for Economic Cooperation and Development) report that we have the most restrictions on foreign investments among 84 countries, after the war-torn Gaza Strip, the West Bank and Libya, there is really no other legislator, even in the Lower House, passionate about the lifting the remaining constitutional limits on media, advertising and a handful of other strategic industries.

Of course, the rest of the senators aren’t, as they know on the ground that lifting the restrictions will be a case of the mountain laboring to give birth to a mouse, as it will certainly not result in a massive inflow of foreign capital. In the case of advertising, why would they set up corporations here when they already control the industry through branches in the Philippines, such as the Japanese Urala, the Singaporean AJ Marketing and the American FCB? These kinds of companies, after all, are not capital-intensive. Will Harvard or Yale set up universities here, where the market is too small, as our elite prefers their scions to be sent abroad for higher studies. US universities also rely a lot for their viability on big businesses giving them multimillion endowments. Our oligarchs obviously aren’t much interested in developing our educational institutions.

Or it will be a classic instance of textbook captive state by oligarchs. Do you really think that the likes of the triad that owns GMA 7, the Salim-MVP group that is now the biggest media conglomerate, Robert Coyuito and Enrique Razon of the National Grid Corp. of the Philippines will allow the restrictions on foreign investments in their industries be lifted?

No evidence

There’s just no strong evidence that parliamentary, single-chamber systems are better than presidential systems. Some 60 percent of the states in the world are unicameral while 40 percent are bicameral. There are prosperous countries that are bicameral (e.g., the United States and Australia) or unicameral (e.g., Denmark and Sweden). A state being unicameral or bicameral has nothing to do with its economic growth and attractiveness for foreign capital.

There are drawbacks in each system. Our bicameral system’s biggest drawback is that the Senate becomes populated, especially in this age of media dominance, by really know-nothing celebrities, those who have name recall because of their fathers like convicted criminal Jinggoy Estrada and his half-brother, those whose husband or father has billions of pesos to spend in a nationwide senatorial campaign like the Villars and Gatchalian, or those whom the most popular president ever, Rodrigo Duterte, asked his huge number of supporters to vote into office.

The most obvious backward feature of a unicameral system is that these would be populated by political, intellectual and financial pygmies — even by dubious “party-list” representatives including those fielded the Communist Party — who can be bought, either through outright “monthly allowances,” lucrative committee appointments and pork-barrel allocations. (Yes, it still exists but with different nomenclatures.)


The very fact that House Speaker Romualdez thinks he can be head of the country through a parliamentary-unicameral system is proof positive that a unicameral system would be very bad for us. If not a Romualdez, an oligarch or an alliance of oligarchs could easily get a 300-member chamber under their absolute control.

That Congress is barking up the wrong tree is evident in the fact that there is no Congress body that is hearing or studying what is really one of the biggest obstacles to foreign investments. I’ve asked many foreign executives, even local ones, why they think the Philippines isn’t an attractive place for their investments.

I always get the same answer. After political instability (which largely ended after President Gloria Macapagal Arroyo crushed the Yellows and the egoistic traitors called the Hyatt 11), peace and order (which Duterte succeeded in imposing), and corruption (which level hasn’t changed for decades), it is the high cost of our power that is a big disincentive for foreign investments. This is especially true for manufacturing concerns which are the kind of industries that would grow an economy.

The Philippines’ electricity rate for businesses, 15.8 cents per kilowatt-hour, is second only to the highest in the region, Singapore’s 31.4 cents. Our rate though is much more expensive than Indonesia, China, Thailand and Malaysia. Our industrial rate is double that of Vietnam’s 7.8 and China’s 9 cents.


Now, are you still wondering why foreign investments in the past decade have been going to China and Vietnam? Remember that the basic considerations of any business is its cost structure. If electricity eats up much of its expenses, it will look for countries where they can reduce the cost of this necessary input.

Unfortunately, our Energy Secretary Raphael Lotilla and our electricity oligarchs have been disseminating a nothing-we-can-do attitude by claiming that those Asian countries have been subsidizing 50 percent of their electricity rates.

So? Shouldn’t Congress and the Energy department put their heads together to study how our rates can be lowered? After all, if our high electricity prices are the big disincentive for foreign investments, shouldn’t we find ways and means to bring it down, even to also subsidize these? Or do we just resign and accept the fact that we’ll never be an attractive site for foreign capital? If the Indonesians and Vietnamese could do it, we certainly can. But our leaders are instead claiming that changing the Constitution will attract foreign capital.

Ironically though, my computations are based on annual reports of First Pacific, the Indonesian-controlled owner of Meralco (which are available online), the firm is making tons of money in distributing electricity. How much? Buy a huge a $1 billion in a 10-year period.

Something’s really wrong here, and it’s not in our Constitution.

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