Wake Up, Philippines!

Counting the cost of corruption in the Philippines

“…Elections are like a sponge, it sucks up all the money, most of it from corruption.”

Among the very first lessons in business is that “THERE IS NO SUCH THING AS A FREE LUNCH”. Somebody is bound to pay, Always. Especially when it comes to corruption. So how does corruption get to us? Let’s count the ways.

1. Loss of Government Revenue

The first victim of corruption is government revenue. In a developing economy like the Philippines, this can be extremely debilitating. The continuing budgetary deficit of the government results into cutbacks in expenditures for much needed social services.

2. Education

The gap of classrooms in public elementary schools is estimated to be about 40,000 this coming school year. The case is even more pathetic, as the lack of qualified teachers further confound the problems. While student population keeps on growing year after year, these gaps in classroom, books and teachers is widening. What do these lead to? Poor quality education of the future citizens of the Republic further undermining their prospects of contributing to nation building. THAT IS A VERY HIGH PRICE TO PAY FOR CORRUPTION.

3. Infrastructure

With tightening sources of funding for infrastructure development, government has to resort to partnership with the private sector. A public good like roads, bridges, ports and airports will necessarily be charging user fees to be able to earn profit and recover capital. Nothing wrong with because he who benefits should share the cost. But a lot of these projects require performance undertaking from the government to be financiable to lenders. This results into the contingent liabilities of the national government burgeoning the levels no one wants to even find out. Remember the NAIA III Terminal? an edifice that can’t be operated until now. The MACAPAGAL BOULEVARD which can easily enter the Guiness Book as the world’s most expensive boulevard? THE SMOKEY MOUNTAIN PROJECT where almost a billion of OFW’s money was invested and has not been repaid until now? Last count in 2003, it stood to over P500 Billion. That’s about over 30,000 pesos per household. THAT IS NO LOOSE CHANGE TO PAY FOR CORRUPTION.

4. Environment

Because government resources are constrained, environment protection programs are neglected. We passed the Clean Air Act and yet we cannot put our acts together in ensuring clean air. The law is toothless because the government has no money to invest in monitoring equipment. Even garbage it cannot collect. Remember the PAYATAS TRAGEDY? Meanwhile, to be able to generate power and run our heavy industries, less desirable Plants are allowed to be established. ASK THE PEOPLE from CALACA, BATANGAS, PAGBILAO QUEZON, and SUAL PANGASINAN, all sites of COAL FIRED POWER PLANTS that contribute to withdrawals from our deposit of breathable air, potable water and liveable communities. The resource balance of our children’s future is rapidly depleting, A COST OF CORRUPTION THAT WE MAY NEVER BE ABLE TO ACCOUNT FOR.

5. Government Debt and Poverty

Again due to budget deficit, government keeps on accumulating debt, which at end of 2003 stood at over 2.4 trillion pesos. That’s over 30,000 pesos for every Filipino man, woman and child. At an average interest cost of 10% per year for both short and long term loans, that is equivalent to a staggering P240 Billion in interest payment alone every year. That’s the amount of money taken away form the mouth of the poor, who account to more than half of the Philippine population. TURNING OUR BACKS FROM OUR MARGINALIZED CITIZEN IS A STEEP PRICE TO PAY FOR CORRUPTION.

6. Political Patronage


Elections are like a sponge, it sucks up all the money, most of it from corruption. Election in the Philippines are nothing but patronage politics. How else does one explain the millions spent in a campaign in exchange for a few measly thousand pesos in the salary of a public servant? There is only one explanation I have, THERE IS NO SUCH THING AS A FREE LUNCH, SOMEONE IS BOUND TO PAY FOR IT.

How do campaign contributors expect to recover their investments? In the form of political protection to allow them to continue with their illegal activities. In the form of rigged government contracts. In the form of economic rents taxpayers eventually pay for.

7. Crime

Corruption corrupts and the deeper one gets into the mire, the more desperate one becomes in defending the well from where he draws his booty. He will be prepared to use trick, treat and threats to keep his business. And since corruption, like stale food attract flies and worms, criminal syndicates are not very far from them. So do their violent means of doing business.

The problem with the proliferation of illegal drugs can be linked solidly to corruption. How else do drug lords and pushers do their business under the noses of law enforcers and local government officials except that they pay-off this public servants or work in cahoots with them. Remember Mayor Mitra of Quezon Province? He was caught red handed transporting a ton of shabu using the town ambulance.

This social ill has led to the commission of many a heinous crime is prospering and multiplying in every Barangay of this country because of corruption. RAPES, MURDERS, and KIDNAPPING FOR RANSOM ARE TOO MUCH TO PAY FOR CORRUPTION.

8. High Cost of Doing Business

It is sometimes beyond our imagination for a businessman to spend three full days in the crowded city hall of a highly urbanized city trying to get a business license. And he was just going to buy and sell eggs. How much more if he wants to operate a industrial project. If there are 20 government offices he needs to go through for various permits, licenses, certificates, approvals and signatures, he needs an entire army of fixers to handle them. Precious hours are lost among senior officers of the firm who have to wine and dine to the whims and caprices of government officials. Remember the stinking IMPSA and PIATCO deals?


On the other hand, many of those who stay to do business have gotten used to government people scratching their heads as they show up in their offices asking for all sorts of gifts for every known relatives of a mayor, congressman, senator, department secretary, bureau director or chief of police. What does the businessman do? He just passes on to his customers this extra cost incurred in doing business in the Philippines. Remember the Power Purchase Adjustment (PPA)? This is one bloody scheme that sucks us dry!!!

9. Loss of Investor Confidence

As Judge W.H. Heath said, if we cannot manage our money and assets, how can we be expected to manage other people’s money? Investors demand that there be a reasonable level of assurance that they will get their investment back. That their investment will in fact make money. And that it will not be taken over by political forces.

It becomes extremely challenging to attract investors to do business in a country where a fugitive from the FBI and convicted pedophile gets elected in Congress. Or where tax evasion case with very clear outcomes is lost to technicalities.

Multilateral donors find it hard to give us loans and technical assistance grants when they know that a large portion of their money will be used to line up the stomachs of politicians. They will have to invest in additional personnel, incur additional costs just to watch us spend their money. Every time we submit receipts they spend thrice the time just verifying whether they are genuine or not. This is the only country in the world whose AUTHENTIC DOCUMENTS (as declared and sealed from Malacanang) has one year expiry date. Believe me it can be tiring to do these things.

When many in the International community considers your country as corrupt, it does not feel good. It does not buy you goodwill. Jeers and sneers YES. But respect? NO!!! Just look at how we PINOYS are treated in foreign airports. Who would forget Senate President DRILON being forced to remove his shoes in a US airport despite showing his Diplomatic Passport. I myself had a very disgusting experience in SCHIPOL airport in the Netherlands (CARLO BUTALID & GRACE CABACTULAN MAY NOT AGREE WITH ME) and at Charles de Gaulle in France. But can we blame them? Of course not. There’s simply too much Pinoys who are going out of the country with spurious documents, escorted and facilitated by no less than BID personnel from NAIA. THAT IS WHAT WIDESPREAD CORRUPTION IS COSTING US.

We have only just began counting the cost of corruption. It cost us the prostitution of our political institutions. We have now hoodlums in uniforms and hoodlums in robes. It costs us many lives and honor lost to crime. It costs us our self respect. And it costs us lost opportunities for a better future of our children.


Author: Jun S. Aguilar
Date: March 12, 2004

Related Articles: