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I NSIGH TS & ANALYSIS: ADVANCING REAL ES TATE U N D ER THE D U TERTE AD MIN IS TRATIO N

Issue 50, Vo lum e V I I AUGUST & SEPTEMBER 2016

A NATI ON ON THE R I S E SPE C IA L INDE PTH RE PO RT O N FE DE RA L ISM & THE PHIL IPPINE S

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Departure honors is being accorded to outgoing President Benigno S. Aquino III at the MalacaĂąan Place Grounds before his successor, President-elect Rodrigo Roa Duterte, takes his oath of office. President Aquino goes straight to his residence at Times Street in Quezon City on board a private vehicle after the honors.

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O UTLOOK | N AT I O N O N T H E RI S E

The United States Of The Philippines WRITER

IMAGES

Raphael John C. Oriel Presidential Photographers Division of the Philippines

Whichever way you want to phrase a federalist system of government in the Philippines, it sounds promising.

However, let’s take an in-depth look at the why, how, and what the possible outcome would be if federalism is installed in the Philippines.

Changing the fundamental system of government—constitutional reform— altering the very fabric of a nation not spiraling out of chaos from altering the procedures, policies, to the coordination we all have grown accustomed to requires heavy analysis, forecasting, and remarkable vision. Are we as a nation of more than 100 million Filipinos

and

another

10

million

around the World (who are heavily invested in the country) ready for such fundamental change of government in the Philippines? Although the country is on a consistent upswing economically, the call amongst citizens for drastic changes in policy is gaining momentum.

Proponents,

lead

by

President Rodrigo Duterte, argue that now has never been a better time to do it especially since it will take several years to fully comprehend the results well beyond President Duterte’s term (assuming that a gradual process is streamlined).

From the days of Emilio Aguinaldo and Apolinario Mabini, Federalism has been championed for decades.

But updating governmental systems are much easier than simply clicking install and waiting for the software to be updated (unless you’re not digitally savvy then this can be anachronistically familiar). To say the least, transforming a nation comprised of over seven thousand islands and 81

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Proposed Federal States

B as e d on a 2008 proposa l by form er Sen. Aqui l i no Pi mentel Jr.

A Northern Luzon Capital: Tuguegarao

A

Northern B Central Luzon Luzon Capital: Capital: Tuguegarao Tarlac City C Southern Tagalog Capital: Trece Martires City

B

C L

D MIMAROPA Capital: Mamburao

E

E Bicol Capital: Legazpi

F

D

H

Northern Capital: Tuguegarao F Eastern Luzon Visayas Capital: Catbalogan

G

G Central Visayas Capital: Toledo

I

Northern Capital: Tuguegarao H WesternLuzon Visayas Capital: Iloilo I Northern Mindanao Capital: Cagayan de Oro

J

Capital: Tuguegarao JNorthern SouthernLuzon Mindanao Capital: Davao City K Bangsamoro Capital: Cotabato City

K

L Federal Adminstrative Region of Metro Manila

Source: Rappler.com

2016 National Budget R e g i on a l i z e d Budge t Metro Manila

Luzon

Visayas

Mindanao

14.27%

P h p 428.5 B*

P h p 628.3 B*

Php 2 9 8 . 3 B*

Ph p 396.9 B*

20.94 9.94% 13.23% Source: Department of Budget and Management

*Excludes allocations fotr the Office of the President, Office of the Vice President, and Congress which are located in this region.

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be adopted in the Philippines, then different states would have laws that are conducive specifically to the citizens of that particular state—what is legal in Pangasinan might be illegal in say, Cebu.

The moniker, E. Pluribus Unum, “Out of Many States, One Nation” captures the very essence of what this form of government really is. In the beginning of America, there were 13 quarreling states. Like the Philippines, these states have a wide range of differences from their culture, history, economics, geography, population, politics, and natural resources, even the language is different—to each require their own specific needs. The original U.S. States wanted all the powers that come as a sovereign nation, from formulating treaties, welcoming trade ambassadors, their own currency, to being able to regulate commerce. Yet later down the line, those states realized in order to survive in world trade, influence, and self-defense, they required the aid and assistance of a strong federal government. And with that, the Articles of Confederation were drafted to form what is now the United States of America.

EMBARKING ON THE UNKNOWN No one knows what a Federal Philippines will look like nor can anyone expertly forecast how it will function To this day, Americans debate and

especially since it means different

argue fervently what the proper role

things to different people and un-

of the central government and its

doubtedly, there will be growing pains.

member states should actually be.

If the Philippines were to implement

Federalism takes its roots from

Some states and its citizens want

U.S. style federalism, how much would

the U.S. Constitution. Looking at the

more autonomy with less power from

it cost? How long would it take for

efficiency of how the 50 US States

the central government, whereas oth-

states to agree on how much power

and

interlace

ers prefer the opposite. You can look

the central government would have?

and function independently and as

no further then hotly debated issues

How long would it take for each state

a whole, it is clear that federalism is

such as Obamacare, gay rights, im-

to draft their own State’s Constitution

one of the most critical and innovative

migration,

decriminalization

and judicial system? Each state would

concepts of government ever concep-

of drugs, abortion, the death penalty,

have to elect a legislature, from there,

tualized—simply put, it works—but

to gun control. For example, the state

they would need to decide on how

like any system, it needs to instituted

of New York has vastly different laws

many “States” would be formed to

correctly.

than California. If federalism were to

define the country—how do you divide

provinces to get out of the status quo is no easy feat.

E. PLURIBUS UNUM

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Federal

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government

taxes,

RESEARCH BY

Joseph Almer B. Pedrajas

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81 provinces into its own state? How would citizens feel about dividing the country into distinctly new states?

How would Illocos Norte feel being part of Tarlac? As proposed by former Senate President Aquilino Pimentel Jr.’s 11 federal state plan, this could possibly happen: 01 Luzon: 4 states (Northern Luzon, Central Luzon, Southern Tagalog, Bicol) 02 Visayas: 4 states (Eastern Visayas, Central Visayas, Western Visayas, and Minparom, covering Mindoro Oriental and Mindoro Occidental, Palawan and the Kalayaan Islands, Romblon, Marinduque) 03 Mindanao: 3 states (Northern Mindanao, which may be subdivided into Northwestern and

Northeast-

ern Mindanao; Southern Mindanao, Bangsamoro) Under central

Pimentel’s government

proposal, would

the

retain

powers to deal with issues of national interest, such as foreign policy and national security. The 11 federal states that would be created out of the exist-

government there to balance out the

from the main headquarters. And if

ing

incompetence.

those c-suite executives and regional

administrative

regions

would

heads underperform, they would be

enable the identities of the proposed states to already be known by the people well before the vote. But how

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WORKING AS ONE COMPANY NATION

fired. In the case of a country, they would be voted out by the citizens (at least you would hope).

do we organize and merge some of

Think of federalism as a giant multi-

the smaller provinces that just have

national corporation. The company

The proposed plans of federalism

30,000 citizens with the ones that

has its main headquarters with re-

would allow states to keep 80% of their

have almost 2 million? Because of this

gional offices or region based centers

revenue with 20% going to the federal

question, wouldn’t some states lag

of command. You have the corporate

government. Arguments for regional

behind and have uneven development

structure—the c-suite executives and

autonomy aren’t centered on efficien-

among other states? Again using the

a board of directors who are in charge

cy or mitigating the power of Imperial

U.S. states as an example, Southern

of ensuring that the company is

Manila versus other regions, but much

and Midwestern States are considered

performing optimally. At the regional

more to do about the overpowering of

by many to be less developed and

level, you have the country directors

Manila elites vs provincial elites. If

progressive when compared to coastal

and the managing partners. These

the argument was really about ensur-

states in terms of education, tourism,

people receive directives from the top

ing that national budgets are evenly

trade, to even infrastructure—think

and execute whatever business plans

dispersed outside of Manila, then

California’s economy versus Missouri.

and orders need to be undertaken and

simply put, allocating more money

Further, states with good leadership

at the same time, vouch for project

for development projects in other

will progress much faster while those

budgets and actionable items they

parts of the country can naturally be

with ineffective, corrupt leaders would

wish to enact themselves. Each year

channeled through the Department of

only result in continuous underdevel-

or quarterly, those regional offices

Public Works—transparently. For the

opment especially without the federal

receive the fiscal plans and budgets

Manila elite, there really is no differ-

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RESEARCH BY

Joseph Almer B. Pedrajas

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ence if Public Works are spent on project X in Manila as opposed to project X somewhere else because at the end of the day, they make money regardless. For the average Filipino, he/she doesn’t care who builds the road, as long as it gets built. But for controlling political dynasties and businesses, the loss can add up to the bottom line and this is where things get trickier.

And perhaps former mayor of Davao City

understands

this

more

than

anyone else—that local governments are

marginalized

from

receiving

substantial development aid. That is why development in the Metro-Manila is generations ahead of other parts of the country. And without the national government’s assistance, could this further empower political dynasties into kings and queens?

Would

federalism

provide

every

Filipino with a consistently fair, sustainable, and equitable opportunity to achieve a quality and substantial standard of living? Evenly distributed fiscal policy as opposed to trickle down economics? What would drive demand and provide solid economic growth and consumer confidence on the micro, regional level? For President Duterte, to achieve this economic goal, federalism is the answer.

President Rodrigo Roa Duterte conducts an inspection of troops during the commemoration of the 69th Founding Anniversary of the Philippine Air Force (PAF) held at Clark Air Base in Pampanga.

MORE ACCOUNTABILITY & COMPETITIVE SPIRIT Currently, the Philippines has a

from the federal government. As a

national level could this lead to the

unitary form of government where

result, it would be even more critical

decongestion of Metro-Manila? Would

the majority of administrative pow-

for citizens to make the right choice in

Filipinos still desire to live and work

ers and resources reside within the

electing their local government offi-

in Metro-Manila if there were more

jurisdiction of the national govern-

cials as those people will be in charge

jobs

ment which is based in Metro-Manila.

of solving their problems. As it stands,

or perhaps if business taxes were

Malacañang

decides

the

opportunities

elsewhere

national

provinces are only able to collect

friendlier than the big city—would

budget—how much is given to local

real estate tax and business permit

that spike businesses to invest else-

government units—the LGUs who are

fees. Equipped with federalism, local

where? Creating an atmosphere of

unfortunately prone to abuse despite

government units would then keep

co-opetition would further promote

requiring approval from the national

more of the income generated with a

specialization among national and

government on how to consume the

percentage going to the state govern-

state

allocated budget provided.

ment with ultimately a fraction to the

government could focus on foreign

national government.

policy, defense, healthcare, foreign

Under federalism, states will have the power to make their own decisions with little to no interference

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and

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governments.

The

national

the

trade, and taxation. On the state level,

country’s overall wealth evenly on a

states would be forced to concentrate

With

federalism

distributing

on developing their own industries and attractions which should create competition amongst states for tourism, trade, and investment.

WHERE NO COUNTRY HAS GONE BEFORE In the political history of the world, in no time has an independent nation ever subdivided itself into a federal system. Attempting something that has never been done before in terms of government has not, historically speaking, produced clear cut positive results. (Citing democracy in the Middle East would be an exaggeration, well, at least for now.) At present there are 25 nations that are distinctly de-

President Rodrigo Roa Duterte holds his first Cabinet meeting held at the Aguinaldo State Dining Room of the Malacañan Palace. The agenda focuses on disaster risk reduction and management status of the country.

“Last year, 35% of the national budget went to Metro-Manila even though it only represents 14% of the entire Philippine population.

scribed as federal systems (although Spain and the United Kingdom are by all intents and purposes federal, but do not define themselves as such). In all cases historically, it was always the

individual

independent

states

that agreed to formulate a national, central government and this includes the United States and Malaysia which are two countries that are similar (moderately) in our own culture and attitude toward government. All other cases of a federal system being formed were upon gaining independence (not decades later which the Philippines may set out to do), and this includes countries such as Mexico, Argentina, Brazil, and Nigeria which are all nations known to have strong central governments. With this notion, it is unpredictable what can happen especially if a province is already unstable in leadership and primed for exploitation (which the Philippines has been troubled by). Yet, this could be precisely why President Duterte’s

As he delivers a press statement on the Philippine Illegal Drug Trade Hierarchy in Malacañang, President Rodrigo Roa Duterte shows a copy of an Illustration that explains the connection of high level drug syndicates operating in the country.

first order of business is focused on

if we want it to happen. It won’t be

too well. Just recently British citizens

ridding the country of crime, corrup-

federalism that will cure the country

had their moment of deciding their

tion, and drugs—all very encouraging

of traffic violations, bribery, littering,

country’s destiny with the decision

for political and economic observers

poverty, nepotism, paying the proper

to leave the European Union, Brexit.

in addition to local and foreign would

taxes, or violent crime. Perhaps all

Perhaps soon, Filipinos will have

be investors.

the country needs is discipline and

their chance to decide on a new path

remain.

in the first several weeks of President

and destiny about something they’re

Federal or not, change only happens

Duterte’s term, he understands this all

responsible for. B

But

so

many

questions

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