Under the Macapagal-Arroyo regime:
Conflict and compromise within the ruling class

Basahin ang artikulong ito sa Pilipino

Consequent to the persistent demand of various democratic sectors, the Macapagal-Arroyo regime has thrown Joseph Estrada in jail. Estrada is now set to face a plunder case before the Sandiganbayan. Nonetheless, he still has tremendous resources at hand to undertake legal and political maneuvers to escape punishment.

It is only the people�s militant actions that can ensure that he and his leading co-conspirators remain in prison, would be prosecuted, put on trial and punished. We must be vigilant and resist any move to "settle" the case and allow the guilty parties to go unpunished.

Plunder and graft cases were filed at the Sandiganbayan after militant organizations demanded that the Supreme Court affirm Estrada�s ouster to bar him from invoking legal provisions granting presidents immunity from suit. Before this, Estrada and his minions were able to move around scot-free and campaign for the elections. They still control tremendous resources and retain a level of influence over the reactionary bureaucracy, especially local administrative units, enabling them to wage a strong campaign, finance rallies, commit electoral fraud and position themselves in power.

Behind all the brouhaha over the processing of Estrada�s cases, however, his biggest cronies, co-conspirators and patrons are quietly being exempted from punishment one-by-one, in exchange for economic and political concessions for the regime.

Lucio Tan, one of Estrada�s erstwhile leading cronies, has been granted a reprieve in the payment of billions of pesos in loans from the Philippine National Bank (PNB) to prepare for the latter�s impending privatization and to convince Tan to sell his PNB shares so that the bank could be sold to a foreign bank that has expressed interest in acquiring it.

At first, the government went through the motions of going after Tan�s P25.27-billion unpaid taxes and filed an appeal to reopen a tax evasion case against him that had already been dismissed by the courts. But the regime suddenly backtracked and declared that it was ready to grant amnesty to big tax evaders (like the Marcoses) provided they enter into a compromise and settle part of their tax obligations.

Another major factor in Macapagal-Arroyo�s benign attitude towards Tan is the support for the 2004 elections that her clique is set to receive from him and other Filipino-Chinese businessmen. Macapagal-Arroyo�s main broker in cornering deals with Filipino-Chinese businessmen is her husband Mike Arroyo.

Estrada�s patron Eduardo "Danding" Cojuangco Jr. is also currently in the thick of negotiations with the Macapagal-Arroyo clique. In fact, Cojuangco�s Nationalist People�s Coalition (NPC) party has already declared its support for the new government.

It will be recalled that the newly installed Estrada immediately restored Cojuangco to the leadership of San Miguel Corporation (SMC) in 1998. There is now a running battle (within and outside the courts) between Cojuangco and the new government for control of SMC, the biggest corporation in the hands of Danding.

The Macapagal-Arroyo clique would like to remove Estrada appointed representatives (including his brother-in-law and close friends) from the board of directors, replace them with its own people and install a new chairman. Among those Macapagal-Arroyo would like to seat are former Presidential Security Group chief Gen. Leo Alvez and Renato Valencia, former Social Security System president under the Ramos regime and potentially the new SMC chairman.

Open tactics to seize the chairmanship from Cojuangco include the government�s pursuit of a case to settle ownership of the coconut levy funds (comprising 95% of the shares of United Coconut Planters Bank or UCPB) which were appropriated by Cojuangco to purchase 27% of SMC shares. As soon as the Supreme Court decides that the coconut levy funds are publicly owned, the regime shall gain control of practically the entire UCPB and the 27% SMC shares. This, along with SMC shares held by other government agencies like the Social Security System, Government Service Insurance System and the AFP Retirement and Separation Benefi ts System would be enough to oust Cojuangco and vote in Valencia.

But Cojuangco is not an opponent to be trifled with. He boasts of having the sympathy of many private SMC shareholders. He continues to have significant blocs within the police, military and civilian bureaucracy in his pocket. Destabilization threats from his end remain. SMC, however, is too big a milking cow for the Macapagal-Arroyo clique to leave in Cojuangco�s hands.

With the Macapagal-Arroyo government coming to power at a time of unprecedented crisis, there are very few resources that the various factions of the ruling class could peacefully divide among themselves. The new ruling clique will fight tooth and nail to gain possession of the more lucrative spoils of power.

Thus it is acting swiftly to neutralize Cojuangco�s biggest henchman Gen. Panfilo Lacson. Macapagal-Arroyo abolished the Presidential Anti-Organized Crime Task Force (PAOCTF) and has threatened to divulge the crimes that the agency perpetrated under the Estrada regime. The government has also been consistently baring evidence that would link Lacson to the November 2000 abduction and brutal killing of public relations practitioner Salvador Dacer and his driver. The presentation of cases against Lacson is reaching a crescendo as the elections near in an effort to prevent him from positioning himself once more.

Behind all this, the government is cooking up a deal that would grant Cojuangco 20% ownership of the disputed UCPB and SMC shares in exchange for the regime�s cornering of the remaining 80%. Cojuangco is as yet adamantly against such an arrangement.

Meanwhile, as pressure continues to bear on Cojuangco with respect to SMC, Macapagal-Arroyo has agreed to a number of minor concessions offered by Cojuangco such as the

merger of the ruling Lakas-NUCD with NPC. Danding�s son Marcos Cojuangco is currently running for congress in Pangasinan under the Lakas-NPC banner. The existence of an alliance between Lakas and the United Negros Alliance (or UNA, Danding�s party in Negros) has also been bared as news broke out that Ignacio Arroyo, Gloria Macapagal-Arroyo�s brother-in-law and Lakas-NUCD head for Western Visayas, has been shelling out funds to both Lakas and UNA candidates.

There has also been a level of compromise between the Macapagal-Arroyo regime and the hated Marcoses. Ferdinand "Bongbong" Marcos Jr. is running for reelection as governor of Ilocos Norte under the Lakas-Kilusang Bagong Lipunan banner.

Meanwhile, Gen. Angelo Reyes, former AFP chief under the Estrada regime, was retained in his post by Macapagal-Arroyo and later appointed defense secretary. Former deputy chief of staff , AFP intelligence chief and head of the Presidential Security Command, Gen. Jose Calimlim has, on the other hand been reinstated as chief of Task Force Aduana, renewing his opportunities for striking it rich through smuggling.

The face of cronyism under the Macapagal-Arroyo regime is slowly emerging.

Contradictions and the struggle for concessions and accommodation will continue and even intensify among the various factions of the ruling class, especially since the new ruling clique is still in the process of consolidating.

April 2001
English Edition

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