Essays, Law and Politics
JPE’s Memoir, is a narration of political events that bedevil the nation beginning 1924, when a poor boy, Juanito Furagganan, JPE’s childhood name, was born in barrio Mission in the town of Gonzaga, a sandy, coastal, fishing village situated at the mouth of the Mission River, Cagayan, up to the historical impeachment of Chief Justice Renato Corona of the Supreme Court this year (2012). It would be a gross injustice to make a review of his personal and emotional meandering using a shot-gun approach to myriad topics he has unraveled in full color, but dull on details which are well known to the public and well-meaning researchers. Thus his narrative loses candor and vibrancy. This review by installment of his Memoir is an attempt to toss into the crucible the bulk of his narrative. More of this post are forthcoming as time permits.
“He (Marcos) was x x x publicly charged with land grabbing because of his titling some thirty thousand hectares of land owned by the Bayawa family in Diffun, in Quirino Province. He was called a forger because of alleged fake war war damage claims for lost cattle during World War II from his father’s ranch in Mindanao. He was attacked as a corrupt public official because of his alleged influence-peddling activities during the days of import controls in the country, following the end of the Second World War, while he was a member of the House of Representatives. There were other venalities thrown against him. He was regarded as a corporate stock manipulator, a womanizer, a holder of fake military medals, and a recipient of bribes and illegal commissions from reparation contracts under the Japanese reparation law.”
With the sudden barrage of serious charges against Marcos, the urgent need for a strong and skillful army of personnel to assist him in studying and handling the pressing issues emerged. Paeng Salas quickly assembled a group, composed mostly of lawyers at the beginning, to help in gathering the necessary documents and information, and in preparing arguments, answers, and defenses to the charges against Marcos. (JPE Memoir, Kindle Edition).
In his narrative JPE said that he was able to defend Marcos’s right over the huge 30,000 hectares of land by providing Marcos a brief of his research on large scale land acquisitions, matters that became second nature to him because of similar huge land acquisitions he was able to conclude for local and foreign clients like San Miguel Brewery, Dole Philippines and United Fruit.
But observed how JPE in 1987, while serving as minority Senator, would shed his pro-haciendero culture to that of a politician embracing a populist culture of ‘land for the landless’ bemoaning the continued exemption of some 6,000 hectares of Hacienda Luisita from the coverage of the comprehensive agrarian reform program.
“It was in this capacity as a lone oppositionist that I opposed the Comprehensive Agricultural Reform Program (CARP), Cory’s centerpiece land reform program. I believed it had as much holes and flaws as Marcos’ earlier land reform program and, in addition, it get an exemption for their huge Hacienda Luisita estate in Tarlac. This deviation from the intent of the law, very controversial from the beginning, would haunt the Cojuangcos and Aquinos for many years and to this very day.” (JPE Memoir, Kindle Edition).
JPE considered the 6,000 or so hectares comprising Hacienda Luisita huge, but not Marcos’s 30,000-hectare estate in Diffun. Apparently, JPE was never haunted for preparing the legal brief which consolidated Marcos title over an area five (5) times larger than that of the Hacienda Luisita. And JPE was mute on the status of that 30,000-hectare Marcos Estate now, a silence that would leave many readers of his Memoir cynical of his new-found pro-farmer advocacy.
JPE was also silent on the issue of whether he was part of the legal team that tried to deflect the sting of the other accusations against Marcos prior to and during the 1965 presidential elections. Nor did he ever give his readers any hint that Marcos could be guilty of those accusations. JPE though said that Marcos was already rich when he ran for the 1965 Presidential elections because Marcos entrusted to him the former’s financial records when he filed his certificate of candidacy for president. He knew that Marcos was haunted by a virulent accusation about graft when he ran for President the first time, but JPE never assay the source of Marcos wealth.
Manila Mayor Arsenio Lacson, a young lawyer in 1935 who was in the defense team of Marcos for the murder of Congressman Nalundasan was more forthcoming. He considered his client guilty of the treacherous murder of Nalundasan many years later. An openness the public had not seen from JPE on the crimes of Marcos. To the end, Marcos was not guilty of anything other than promoting discords among junior military officers due to favoritism in conferring promotions and of putting up a network of cronies, which by the way, JPE was one. He was very loyal to Marcos until Fabian Ver and Imelda had clipped his ‘powers.’
In 1957, Marcos visited Mayor Lacson at his residence at Earnshaw St., Manila and pleaded the irrepressible politician to run for President with him as vice president. Lacson thundered:
“Oh no, wait a minute Ferdinand, I really would want to serve this country as President one of these days. But if the condition is that you will be my Vice President, forget it. I love life, too, and I want to live a little longer, while serving my people. Don’t ever think that I have forgotten the sharp aim of that man who felled Nalundasan with a single rifle shot. I may hardly have the time to take my oath as President before my own Vice President guns me down with that deadly aim of yours. Oh, no Ferdinand, forget it.” (Conjugal Dictatorship of Ferdinand and Imelda, 1986, Primitivo Mijares, p. 235).
Let us look from independent sources about Marcos wealth prior to his being elected President in 1965.
“Marcos claimed that the trial (Julio Nalundasan murder case) and appeals had drained the family resources, (this if true, makes all the more acute questions about the prodigious wealth he subsequently amassed. (Waltzing With A Dictator, Raymond Bonner, 1986, p. 13).
In 1947, Marcos wangled a position on a team that sent to Washington by the Philippine Veterans Commission to negotiate for $160 million in military back pay and benefits but the trip accomplished little.
Back in Manila after that trip, noted Seagrave, ‘veterans became an industry in themselves. The U.S. Congress passed bills providing back pay and benefit, but all applicants had to produce documentary evidence or affidavits to back-up claims of service, situation ripe for exploitation. Ferdinand made money contriving affidavits to support hundreds of claims, some legitimate, many not.
The success he had with the claims of others emboldened him to try a big one for himself. It was at this point that he brought all Mariano’s phantom cattle back to life. He presented to Washington a claim that the 101st Division, USAFFE, had commandeered 2,366 head of Nellore Brahmin cattle from the imaginary Marcos hacienda in Mindanao. Ferdinand wanted $594,000 in damages. After a thorough review of the evidence, Washington concluded that the cattle had never existed. Representing the United States in the matter was Attorney Warren Burger, future justice of the Supreme Court, which led to the Filipino gag: “The beef was imaginary, but the Burger was real.” (Marcos Dynasty, 1987, Sterling Seagrave, p. 132).
Ferdinand claimed to have enlisted spies, saboteurs, and assassin’s throughtout Manila and across several provinces, especially in his old haunt in Pangasinan, In fact, documents show that many of the men closely identified with Ferdinand and his Maharlika were forgers, pickpockets and gang men, and racketeers. Others were part of an Ilocano black-market syndicate engaging in extortion, theft, smuggling, profiteering and occasional atrocities.” (Sterling Seagrave, Marcos Dynasty, p. 84).
“Ferdinand had been appointed by Quirino to a lucrative post on the Rehabilitation Finance Corporation (precursor of PNB, per JCC), headed by Eduardo Romualdez, which was supposed to extend credit facilities to projects that would diversify the Philippine economy, revive existing industries and repair public facilities damaged by the war. In practice these loans were granted only to parties well connected to RFC executives. When the United States sent an economic mission to survey undeveloped Philippine resources, Ferdinand and is friends made a valuable discovery. The Ilocano provinces were the only part of the archipelago that had no major cash crop, but Virginia cigarette tobacco was ideal for the area. Ferdinand decided to pursue the idea with the help of (Harry) Stonehill and (Peter) Lim. (ibid, p. 134).
In 1950, Stonehill took another partner Peter Lim, a leading member of the KMT (Koumintang) and the Chinese chambers of commerce. Within a short time, Stonehill and Lim controlled half the bright-leaf business in the Philippines. Stonehill bought cheap, inferior tobacco and sold it to the government at the subsidized bright-leaf price. The government tobacco monopoly soon found itself burdened with huge quantities of high priced trash, and half the cigarette manufacturers in the Philippines closed down. Stonehill’s profits were smuggled out through Chinese black-money channels to account in Switzerland.
With the money he made, Stonehill diversified into glass; cotton; oil; insurance; newspaper publishing; cement; housing; real estate; land reclamation, resulting in a multi-million-dollar conglomerate with property in eight countries; and a personal fortune of $50 million.
Ferdinand and his associates – Stonehill, Lim and others – were not content simply to prosper from the bright-leaf subsidies. They also reorganized cigarette smuggling on a monumental scale. (ibid, p. 135).
On charges that Marcos fleeced the Chinese for residency and import controls, Seagrave wrote:
” In all these undertakings, Ferdinand showed a double standard. He made a great deal of money through entrepreneurs such as Peter Lim. But in his dealings with Chinese who were not connected with the Chuas or with the Chiang regime, he demonstrated a predatory aggressiveness, using his congressional position to extort commissions and percentages in return for import licenses, foreign exchange credits, and residency permits.”
“All Filipino politicians realized the vulnerability Campaign expenses extorted from Chinese businessmen, who were expected to pay regular retainer to a politician’s law firm as cumshaw or risk losing their import licenses or their residency permits. A routine technique was to introduce blackmail bills that penalized particular industries or firms. A congressman introducing anti-Chinese legislation approached the Chinese business community and hinted that he would drop the bill if a certain amount were paid.
After World War II, the first legislation to be considered by the infant republic was designed to restrict Chinese ownership of businesses. One way to get around this was to become a Filipino citizen. The nominal cost of citizenship was 250 pesos, but legal fees and bribes brought the total to 10,000 pesos. With the Communist victory in China, many refugees were seeking entry to the Philippines and were ready for fleecing. An immigration racket came into existence, controlled by Ferdinand; in which government officials were allotted a “quota” of fifty Chinese each who would pay up to 10,000 pesos under the table for entry permits. Both retail licenses and import permits were authorized by the Committee of Commerce and Industry, which in which in turn was dominated by Ferdinand. His longtime adviser, Jaime Ferrer, told us in an interview that ‘when Marcos was a young congressman, he picked commerce and industry as his area. He had import controls at that time. And he became a fixer. A friend of mine had to pay Ferdinand specific sums of money [for his permits ].” The minimum fee he demanded for an import license was 10,000 pesos. He had full-time staffs at his office and at his home to process, follow-up, and receives donations from grateful businessmen.”
“Chinese merchants also needed permits to get foreign exchange, so they could pay dollars for their imports. Ferdinand traded foreign exchange credits for political contributions. Complained banker Martin Tinio, “We had to pay 10 percent kickbacks – apart from interest. Credit is chokingly tight and politicians control the funds, so we all have to pay and pay.” Washington Sycip, head of Manila’s largest accounting firm, recalled in an interview how Ferdinand ‘was often seen roaming through the Central Bank of the Philippines after completing his deals. Ironically it was during his time that [he] was cited for his fiery oratory and economic expertise. His Central Bank forays, however give him more than the coveted access to foreign exchange. He also used his visits to eye the young clerks processing the cumbersome paperwork.”
“One of those clerks was a young woman from the island of Leyte, Imelda Romualdez. As Ferdinand began to make serious money, he had to salt it away, invest it abroad, and hide his ownership. Jose Campos, a Chinese businessman, began working for him in 1949, putting together forty companies. Campos described how: “Following his directive, I instructed my lawyers and requested the assistance of my other business associates and officers for ad on behalf of [Marcos.] In each case, a deed of trust was executed with “an unnamed beneficiary” listed and the deed was then delivered to Ferdinand, who could fill in any name he wished when it suited him. In effect, Campos wrote him blank checks. The dummy corporations included two Panama companies, two in Hongkong and one that controlled Texas real estate.
Self-interest in Filipino politics was openly celebrated. Clan leaders like the Quirinos of Ilocos Sur, Lopezes of Iloilo, and Laurels of Batangas ran machines that aspiring politicians were frantic to join. Election code forbade a candidate from spending more than a year’s salary on his campaign. He was prohibited from buying votes, giving gifts, or providing free food and drink. This was all ignored. A congressman earning 7,500 pesos a year would spend 700,000 pesos to get re-elected. Once in the national assembly, an energetic congressman could get half a million pesos in public funds for civic improvement in his bailiwick, to guarantee his popularity. Every budget was larded with pork-barrel projects that never went through legislative hearings but mysteriously appeared in the printed budget by a technique called ‘smuggling.’ One-time Senate President Jose Avelino who made $500,000 during his first congressional term summed up the golden rule this way: “We are not angels! What are we in power for? When Jesus Christ died on the cross, he made the distinction between a good crook and the bad crooks. We can prepare to be good crooks.”
By the end of his first term in Congress, Ferdinand was a millionaire. He bought a Cadillac convertible to celebrate. But he was soon confiding to friends that not all the money came from fleecing Chinese. He hinted that he was onto Yamashita’s Gold. (ibid, p. 135-37).
It is unfortunate that JPE would gloss over this dark side of his master and regale his readers with a conclusion that Marcos was already rich in 1965. It was unnatural for a lawyer whose client was being pilloried by his opponents for graft and corruption to cavalierly intone that Marcos was already rich prior to becoming President. That is actually begging the issue.
As to who was Harry Stonehill’s real political patron, JPE was more hideous. He wrote in his Memoir:
“As the campaign for the presidency progressed, the political rhetoric became more virulent. The opposition pinned President Diosdado Macapagal down with the notorious and much-publicized Harry Stonehill corruption scandal, which occurred early in his presidency. Stonehill was reputed to have been the financier of Diosdado Macapagal when he ran for the presidency for the first time in the national elections of 1961 against the then incumbent president, Carlos P. Garcia. Harry Stonehill was a retired American World War II veteran. After World War II, he remained in the country, and set up several successful business enterprises. One of these was a cigarette factory, the United States Tobacco Corporation. Harry Stonehill was accused of corrupting public officials and leading politicians in connection with the operation of his cigarette business. The Secretary of Justice, Jose W. Diokno, an appointee of President Diosdado Macapagal, investigated him for massive bribery on account of a secret payroll retrieved from his office, which listed many high government officials as recipients of monthly payola from him. To spare the Macapagal administration from further embarrassment and to avert the indictment of several big names in government, Harry Stonehill was hurriedly deported to the United States.”
In portraying Macapagal as the chief beneficiary of Stonehill’s largesse, JPE did not dig deep enough to see that it was Marcos, his boss, who was Stonehill’s main sponsor in his racketeering activities in the country during the 50s.