Change is wanting: Dutertenomics and foreign policy

In my previous piece, I discussed how, one year into his term, President Rodrigo Duterte has veered to the right on the issues of human rights and peace.

This time, we look at his socio-economic policies and whether his partial delivery on the demands of certain marginalized sectors are enough to be considered a significant change.

We shall also assess whether his efforts to distance the country away from the United States and towards China and Russia constitute a truly independent foreign policy.

Neoliberalism with a populist flair

During the presidential race, all candidates, including Duterte, gave the usual campaign promises on reducing poverty, ending labor contractualization, increasing pensions, lowering income taxes, developing local industries, allocating higher budgets for health, education and housing, and providing better welfare and social services for the poor. While such promises sounded perfunctory and hollow coming from the typical presidentiables like Mar Roxas and Jojo Binay, it sounded sincere and credible coming from the foul-mouthed, anti-establishment candidate that was Duterte.

But none of the candidates ever questioned the three-decade-old neoliberal economic framework that has prevented such promises from being fulfilled.

Since the late 1980s, the Philippine economy has been restructured along the neoliberal ideology, which is the latest reincarnation of unbridled, free-market capitalism. Neoliberalism’s key economic policies of liberalization, deregulation and privatization have played a big role in preventing the Philippines from developing into a prosperous, vibrant and sustainable industrial economy.

In particular, trade and investment liberalization has institutionalized the dumping of foreign goods in the country and allowed foreign capital to dominate the economy, decimating local industry and agriculture. Thousands of jobs have been lost due to this, leading to chronically high unemployment and depressed wages and incomes. It has turned the Philippines into a service economy providing cheap and docile labor to foreign capital; thus the OFW as the quintessential Filipino worker.

The deregulation of the economy has allowed private capital to amass unlimited profits, tempered only by “market forces” that are easily manipulated by cartels and monopolies. This has led to high prices of utilities and basic commodities. The telecommunications and power sectors are good examples of this.

The privatization of public utilities and services has increased the cost of power, water, oil and petroleum products, and mass transportation. It has held the government’s service and developmental functions hostage to the profit-seeking nature of private corporations whose owners are the biggest campaign contributors during elections.

Despite his constant avowal of being a leftist and socialist, Duterte has adopted these neoliberal economic policies hook, line and sinker. Admitting that economics never really was his forte, he delegated the task of formulating his economic agenda to a team of die-hard neoliberals led by Finance Secretary Carlos Dominguez III, NEDA Chief Ernesto Pernia, and Budget Chief Benjamin Diokno. As expected, the administration’s 10-point economic agenda ended up as a rehash of existing economic policies and programs. It is proof that as far as fundamental economic policies are concerned, change is not coming.

Duterte claims to hate oligarchs but his economic policies favor the same rich, powerful and well-entrenched interests that have lorded it in previous administrations. His token concessions meant to appease the poor – the P1,000 SSS pension hike, a partial ban on labor contracting, free tuition in state colleges and universities, wider PhilHealth coverage and more conditional cash transfers, free houses for the Kadamay “occupy” folk – were a result of hard-fought struggles of the marginalized sectors. But they are nothing compared to the favorable policies that oligarchs and their foreign partners will continue to enjoy under his rule.

In fact, Duterte’s economic team has worked double time to sweeten the pot for big business at the poor’s expense. Under his “hybrid” Public Private Partnership program, big-ticket infrastructure projects will be undertaken by the government using Chinese loans, operated and maintained by the usual rent-seekers in partnership with newfound Chinese investors, then paid for by Filipino taxpayers who will be hit by a triple whammy of increased taxes, high user fees, and increased foreign debt.

A multipolar but still dependent foreign policy

One of the most fascinating aspects of President Duterte has been his anti-US rehetoric. Save for Andres Bonifacio and probably Emilio Aguinaldo, Duterte is the only Philippine president who has openly defied the United States and expressed the intention of adopting an independent foreign policy.

Such a policy is based on key considerations of national sovereignty, territorial integrity, national interest, and the right to self-determination. In more practical terms, the question is: how will our relations with other countries help us defend and exercise sovereignty over our territory, develop a modern, sustainable, industrial economy, and achieve a self-reliant defense posture? 

A year into his term, Duterte has yet to clearly articulate these various aspects of his independent foreign policy.

For one, his anger with the US and EU stems mainly from their valid criticism of the extrajudicial killings due to the war on illegal drugs. And while Duterte repeatedly cites the US’ historical crimes against the Moro people, he has done nothing to correct the injustices nor to stop American intervention in the Mindanao conflict.

Thus, except for scrapping joint patrols with the US in the West Philippine Sea and scaling down joint amphibious exercises, nothing much has changed in PH-US relations. US troops continue to be stationed in various parts of the country. The annual Balikatan exercises, as well as the construction of US military facilities in “agreed locations” under the Enhanced Defense Cooperation Agreement (EDCA), are proceeding as usual. There is no serious effort to end the AFP’s continuous dependence on US military training, technology, arms and equipment.

As the war in Marawi shows, US involvement in the Philippine military is too deep for Duterte to challenge without getting into trouble with the AFP itself. He knows that if he pushes too hard, he might be faced with a US-supported coup. This has reduced his anti-US posturing to merely that.

The good thing is that Duterte is warming up to America’s main rivals, China and Russia. This is a wise move considering the multipolar world that is now developing.

However, can Duterte establish stronger relations with these two superpowers without falling into the same neocolonial trap we find ourselves with the US?

In other words, can we prevent China or Russia from treating us like a neocolony the way the US did – to be used as a dumping ground for their excess goods; a source of cheap labor, raw materials and semi-manufactures for their industries; a loyal paying borrower for their banks; and an enduring military outpost in Southeast Asia?

Considering Duterte’s manner of buttering up to China, we might be in for more of the same. Instead of having only one master (the US), we might end up having two (the US and China) or even 3 (the US, China, and Russia).

Change is wanting

Despite positive efforts, the President has failed to depart significantly from the neoliberal economic policies of previous governments.

He has also tried but failed to recalibrate our dependent, neocolonial relations with the US, and appears intent on merely replicating the same with China and Russia.

All this leads to more doubts on his promise of change. – Rappler.com

Teddy Casiño served as the party-list representative of Bayan Muna for 3 terms, from 2004 to 2013. Prior to his stint in Congress, he was secretary-general of the Bagong Alyansang Makabayan and a columnist for BusinessWorld.