Philippines: Arroyo Endures a Tumultuous July


Lorraine Carlos Salazar

July has been, thus far, the most turbulent month for the Arroyo Presidency as the Philippines, once again, grabbed world headlines. After two months of facing the twin controversies of gambling kickbacks and illegal wiretaps, the Arroyo government nearly collapsed on the 8th of July. As explosive as the London bombings, four well-orchestrated events on that fateful Friday raised the pressure on the Arroyo Presidency as various sectors withdrew support from the increasingly beleaguered president.

First, ten of Arroyo's most trusted economic team-members, led by Finance Secretary Cesar Purisima, resigned from the Cabinet. In a publicised event, they read out a prepared statement claiming the erosion of 'the ability of our President to continue to lead and govern our country with the trust and confidence of our people'. The Cabinet Secretaries urged the President to resign. This they claimed was the 'least disruptive and painful option that can swiftly restore normalcy and eventually bring us to prosperity.' This was followed by a similar call from the Makati Business Club (MBC), the country's premier big business organization and previously a strong supporter of Arroyo. Thirdly, former President Corazon Aquino joined the fray and asked Arroyo 'to make the supreme sacrifice' of resigning. Finally, led by Senate President Franklin Drilon, members of the Liberal Party, who previously formed a coalition with Arroyo, also called for her resignation.

It is not difficult to surmise that the unfolding events, while occurring separately, were well coordinated and clearly related. The withdrawal of support from within Arroyo's camp added fuel to the calls for resignation from the Opposition, the Left, some civil society groups, and academia. Indeed, the perception created was of a cauldron near boiling point that could spill over at any time into massive street protests, leading to a president dismissed via people power, yet again.

The market reacted immediately to these developments. The Peso neared its record low of P56.45 to the US dollar while the stock market suffered. All of the top three rating agencies, Fitch, Standard and Poor, and Moody's, changed their outlook for the Philippines from stable to negative.

It seemed that Arroyo's days were numbered and her resignation inevitable. Yet, those who thought that a transition was in the offing did not expect that the calculated snowballing of events would prove no match for the President's stubbornness. Arroyo went on live TV affirming that she would not resign. She had already apologized for a 'lapse in judgment' but firmly believes that she won and did not cheat in the May 2004 elections.

More importantly, two strategic sectors did not join the bandwagon, which helped Arroyo survive. First, the military declared its neutrality and adherence to the Constitution. Second, the Catholic Church, through the Catholic Bishops Conference of the Philippines, issued a pastoral letter chastising Arroyo, but stopping short of demanding her resignation. The Bishops' decision blunted the clamour for Arroyo to step down and gave her breathing space.

Before that long Friday ended, Arroyo received a further boost from former President Fidel Ramos. Ramos, who enjoys much respect from the military, proposed a swift revision of the Constitution within 10 months, changing the form of government from a presidential to parliamentary system and holding a federal election by May 2006.

When it became obvious she would not resign, the Opposition, composed of a motley crowd of strange bedfellows, tried to bring their grievances to the streets, threatening another people power movement. The protests, thus far, have failed to generate enough public support. Some have pointed to the public's exhaustion at resorting to such options. Others are under-whelmed by the leadership alternatives. Still others believe that while Arroyo is very unpopular, she remains innocent until proven guilty.

When the option of street protests did not materialise, the Opposition, which initially rejected impeachment as a trap (given that the President's party controls the majority of the Lower House seats) changed its tack. On 25 July, a few hours before the President's State of the Nation Address (SONA), 42 Opposition lawmakers filed an impeachment complaint claiming that Arroyo was guilty of 'cheating, lying, and stealing.' Lacking the required 79 signatures for automatic transmittal to the Senate, the complaint was immediately sent to the House Committee on Justice, which has 60 days to assess its merits.

In her much awaited SONA speech, Arroyo remained quiet on the controversies haunting her. Departing from the usual recitation of projects and priority bills, Arroyo called for 'the opening of the great debate on Charter Change' as the best way to reform a political system that has degenerated over the years and has 'become a hindrance to progress.' The call for charter change, via a constituent assembly, was the most applauded part of the President's short 23-minute speech. Congressmen and local government officials who have long been critical of 'imperial Manila' were the most enthusiastic supporters of the proposed move towards a federal, parliamentary government to replace the current presidential system.

Arroyo, it seems, has successfully deflected calls for her resignation as the impact of the political controversies reached a plateau. With the President putting the spotlight on political reforms, it can be expected that the fiscal reform agenda will take a back seat.

WATCHPOINT: The ball is now with Congress, which has both impeachment and charter change on its hands. Will Congress rise to the challenge or will it be bogged down by partisanship, thus triggering massive street protests?


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