On the day of the final reading of the 2011 General Appropriations Act in Senate, thousands of youth, students, administrators, faculty and staff all over the Philippines held protest actions—candle lighting ceremonies, pickets, walkouts, campouts, vigils, rallies and strikes—against the cut on the budget of State Universities and Colleges.

Weeks and even months before, protests against the SUC budget cut already started. A week did not pass without a picket or protest rally held, crying out for higher state subsidy to education. To this, the Aquino administration responded with lies and deception. But the unity of everyone against the budget cut did not waver. After a successful 2-day national strike on the 25^th and 26^th of November, thousands yet again took to the streets on December 1, forcing the Senate to make a move.

This was the statement of Kilos Na Laban sa Budget Cut mass distributed days before December 1.

December 1: We March as One

We salute and congratulate the thousands of students, councils and organizations, educators, faculty unions and associations, employees and administrators in state schools nationwide who made history last week in a resounding expression of unity and commitment to oppose the planned budget cuts on education and social services.

We stood up, walked out and striked, not only for ourselves and our schools. We fought for right of every Filipino to education. We suspended our classes so that more students may be able to study. We barricaded our campus gates for days so that our schools may be open to more young people especially the poor.

We took action for the nation, and for the future. We lived up to being genuine iskolars ng bayan.

We expressed disgust over the fact that the government chose to fund debt servicing, pork barrel and military over education and other social sevices. We striked against injustice, against government neglect, against corruption. We called upon those in power to stand for the interests of the people and not the elite few.

Instead of heeding the people’s call, the Aquino government and its allies insult the people’s intelligence by responding with lies and lame excuses. These however, only serve to expose their criminal intentions. They provoke further our collective outrage by saying that tuition should be hiked to compensate for budget cuts, that tertiary education is a private good, and that SUCs should be abolished.

They arrogantly display their power and greed; they try to tell us that we can do nothing to stop their misdeeds. Through their grand lies, they wish to drown us in apathy, divide us and undermine our collective strength. They want us to abandon our fight, surrender and join them in betraying the interest of the Filipino people.

We will not be cowed. We have a duty to our nation and we have a future to fight for.

We are calling on all students, professors, administrators from state schools, private schools and high schools nationwide. We are calling on out-of-school youths, already injusticed by the current system. We are calling on Filipinos, workers, peasants who will be pushed into further destitution. On December 1, we march as one.

Let it not be said that we did nothing the day a few robbed the people of their rights, their hope, and their future.

Para sa bayan, para sa kinabukasan.

Ipagtagumpay ang laban.

KILOS NA LABAN SA BUDGET CUT!

Here are the pictures from different Kilos Na Laban sa Budget Cut formations nationwide!

Students from different units of the University of the Philippines System held mass actions to protest the SUC budget cut.

State universities and colleges in Iloilo also joined the national protest last December 1.

Mindanao State University also joined the protest.

In Davao City, UP Mindanao together with the University of South Eastern Philippines held a strike and temporarily paralyzed main thoroughfares.

Here are the pictures from the December 1 Senate Mobilization:

Hailing from different State Universities and Colleges in Metro Manila, Southern Tagalog and Central Luzon, students, faculty, administrators and staff marched to the senate.

Everyone sat in front of the Senate gates to listen to the insightful speeches of Kilos Na Laban sa Budget Cut leaders and allies.

UP Faculty regent Judy Taguiwalo giving a speech on the necessity for the youth to further their study of society in order to uproot its ills.

Senate Minority Leader Senator Allan Peter Cayetano updating about the developments in senate.

Congressman Raymond Palatino and Congressman Antonio Tinio joined the march to senate

Kilos Na Laban sa Budget Cut spokesperson Vencer Crisostomo giving a passionate speech, calling on the youth to act not only against the SUC budget cut but for social change.

An estimated 25,000 youth, students, faculty, staff and administrators joined the protest nationwide.

Here is the Kilos Na Laban sa Budget Cut statement released after December 1.

<h1>Advance our initial victory! Persist in the struggle against the budget cut! </h1>

We, the youth together with other sectors, have achieved an initial yet significant victory through our firm solidarity and collective action against the budget cuts to our State Universities and Colleges (SUCs).

On December 1, 2010, our massive national strike against the SUC budget cuts has forced the Senate to amend the 2011 national budget by allocating a P146-M increase for the Maintenance and Other Operating Expenses (MOOE) of our SUCs. This was made possible by the thousands of youth, teachers, administrators, and staff who intensely engaged the Aquino government with vibrant education protests.

As an attempt to break our growing and dynamic unity, the Aquino government and its cohorts have spun the lie that no actual SUC budget cut exists. But we have sharply countered such manic lie with critical thinking and passionate assertion. We have thus exposed the deceit of the Aquino government and its brazen plan to abandon the SUCs to utter destitution.

We have ascertained that Aquino’s “reform budget,” in truth, is no different from, if not worse than, the budget of the rotten Arroyo regime. For both, the same holds true: budget cuts to education and other social services amid billions of pesos given to congressional pork barrel, military defense spending, conditional cash dole-outs, and foreign debt servicing.

By itself, the P146-M additional budget is insufficient in substantially addressing the urgent concerns of the SUCs – deteriorating conditions, lack of facilities and equipment, low salaries, inadequate benefits and contractualization policies for the faculty and staff, and the imminence of tuition and other fee increase. Such additional budget in fact will only amount to P1.3-M if divided among all 112 SUCs. On the other hand, the budget for Capital Outlay (CO) remains close to zero.

Hence, the fight for our right to education is certainly not yet over. We must not succumb to complacency on account of our initial victory. Recently, the Aquino government has reiterated its State policy that support for SUCs will be gradually decreased. Department of Budget and Management (DBM) head Butch Abad, on the other hand, foretells the reduction in the number of the SUCs. These call for utmost vigilance and militancy.

In the immediate is the Bicameral Conference Committee (BCC) meeting of the Senate and the Congress which is set to finalize the 2011 national budget.  The Bicameral meeting is yet another opening for us students, teachers, administrators and staff to assert the removal of the budget cuts to the SUCs.

Our allies in the Senate and the Congress shall do their best to press their colleagues to stand in defense of our right to education by completely removing the cuts in the MOOE and CO of the SUCs.

More crucial, however, is that we arouse, organize and mobilize with greater fervor and broader unity in preparation for the Bicameral meeting. We have already proven something grand and historic – that genuine change is possible if we are united, if we are resolute and if we are militant in fighting for our rights and for our future.

So we shall continue the fight. And we shall be thousands upon thousands more as we advance to greater victories.

Kilos Na Laban sa Budget Cut!

News reports on December 1:

Students storm senate over budget cut on State Universities and Colleges

Palawan State University protests against SUC budget cut

Students protesting budget cuts on State Universities and Colleges

Groups troop to senate in protest of the SUC budget cut

Students storm senate over SUC budget cuts

Rallyists burn Pnoy Effigy

Aquino booed students protest SUC budget cut

For more updates on the budget fight, follow #PHstudentstrike on twitter!

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MANILA, Philippines—Prioritize career diplomats in the appointment of heads of the country’s 67 embassies and four permanent missions abroad, and stop the practice of using such designations as political favors to friends and supporters of the administration.

The call was made Tuesday by overseas Filipino workers and militant organizations as they joined some Department of Foreign Affairs old timers in asking President Benigno Aquino III to “stop prostituting the foreign service.”

The left-wing Bagong Alyansang Makabayan, or Bayan, said “competence is always better a criteria than political allegiance.”

Bayan secretary general Renato Reyes Jr. said “the practice of using foreign diplomatic stations as political favors or rewards to friends or supporters of the administrations truly undermines professionalism in the foreign service.”

“It would be helpful if such a practice was ended,” Reyes told the Inquirer.

For his part, teachers party-list Rep. Antonio Tinio said “Malacañang should appoint career diplomats to foreign missions to assure our citizens, especially OFWs, of the highest level of professionalism in attending to their affairs.”

Terry Ridon, national chair of the League of Filipino Students, said “not only must the President replace erring diplomats, but he must also ensure that their replacements take the real interests of OFWs at heart.”

“There should be immediate assistance and repatriation when it is due. Officials should not allow our countrymen to languish in holding areas and deportation centers abroad,” said Ridon.

Ridon also asked Mr. Aquino to “abandon the long-standing labor export policy and generate jobs at home instead.”

John Leonard Monterona, regional coordinator of the Riyadh, Saudi Arabia-based Migrante-Middle East, observed that “many noncareer ambassadors assigned to embassies in OFW-hosting countries are usually inaccessible.”

Kabataan party-list Rep. Raymond Palatino added in a text message to the Inquirer: “This should have been addressed during the first 100 days of P-Noy.”

But more than 130 days after Mr. Aquino assumes the presidency, he has yet to announce the heads of most of the country’s diplomatic missions overseas.

The President earlier reappointed the following political ambassadors: Francisco Benedicto (China), Ma. Consuelo Puyat-Reyes (Chile), Noe Wong (Cambodia), Mercedes Arrastia-Tuason (Vatican), and Manuel Antonio Teehankee (World Trade Organization).

Aquino also nominated Manolo Lopez, former Meralco chair, to replace the country’s envoy to Japan, former foreign secretary Domingo Siazon whose tour of duty ended last Sept. 30.

Sometime in May, Foreign Secretary Alberto Romulo ordered the recall of the 20-plus political ambassadors who were supposedly co-terminus with then President Macapagal -Arroyo.
http://newsinfo.inquirer.net/inquirerheadlines/nation/view/20101110-302400/Give-career-diplomats-priority-to-envoy-postsOFWs

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In the Philippines, the revolutionary movement is aiming for a qualitative leap from strategic defensive to strategic stalemate in five years, by taking advantage of the intensifying global and national crises and building on current strengths and experiences.

In India and Nepal, revolutionary armed movements led by proletarian revolutionary parties continue to advance with the support of the workers and peoples in these countries. The revolutionary movement in India is steadily gaining strength, forcing the prime minister to say that ;We are losing the war with the Maoists;. After overthrowing the monarchy and achieving great successes in the legal militant struggles and elections, the revolutionary movement in Nepal is now gearing for the seizure of state power to defend national independence and build socialism.

After two decades of blabbering about the “end of history”; the imperialists and their paid propagandists are being put to shame by the perseverance of ordinary workers and people in revolutionary struggle in order to collectively and militantly make history, and to put an end to such a backward and moribund system as imperialism.

All the struggles of the workers and peoples against imperialism and reaction are contributory to the relentless advance towards a new and better world of national independence, democracy, development, social justice and peace.  We call on the workers and peoples of the world to intensify their struggles against imperialist plunder and wars of aggression and open the way to socialism!###

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This was how the anti-imperialist League of Filipino Students described the continuing insistence of the Arroyo government to continue the operation of the militarist and unpatriotic Visiting Forces Agreement, despite the growing clamor from civil society groups, lawmakers and even Justices of the Supreme Court for the VFA’s abrogation.

“After selling out Philippine territory through the soon-to-be-signed Baselines bill, this government seems hell-bent on completely surrendering Philippine sovereignty to foreign superpowers.” said Terry Ridon, spokesperson of the LFS.

He added that Philippine foreign policy remains in ‘absolute kowtow’ to US ‘imperial‘interests in the Asia-Pacific region.

“In the past half-century of Philippine’s nominal independence from the United States, we have failed to implement an independent foreign policy, in which the country asserts sovereignty over its resources, laws and development frameworks against foreign intrusion.” he said.

He said this clear absence of an independent foreign policy has strangled genuine economic development in the country, with the United States opposing many pro-people development paradigms such as genuine agrarian reform and national industrialization. The VFA and the Mutual Defense treaty are no exceptions.

“A growing consensus is building among our people for the abrogation of the VFA, due to the unequal, militarist and colonial nature of the very agreement. This government should take heed of this. Its stubbornness might trigger a new round of large protest movements in the style of the massive mobilizations during the anti-US Bases campaign in the 1990s.” Ridon says finally. ###

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Prepared for the Commission by the IBON Foundation

The deep problems of the imperialist-dominated world capitalist system are in very sharp focus today. The majority of humanity has long suffered unremitting poverty and exploitation – but the people are being pushed into even greater difficulties by the current episode of intense economic and financial crisis which is feared to be the worst since the Great Depression of the 1930s. The current descent into greater socioeconomic turmoil doesn’t just underscore the inevitability of crisis under capitalism. It also exposes how imperialism’s dogged and vicious efforts to secure profits are precisely what create the conditions for ever greater instability. All this affirms how there can never be true socioeconomic development or equity for the people under the oppressive and exploitative capitalist system.

There has been a generalized growth slowdown of the global capitalist system in the nearly four decades since the early 1970s. The relatively high finance- and speculation-driven growth of the last few years hasn’t been able to reverse this trend, aside from such hollow growth clearly being short-lived and unsustainable. The people in turn are further and further away from the false promises of prosperity through neoliberal “globalization”. The number of those living on a conservative $2 (PPP) or less a day has doubled in the last three decades and stands at 2.8 billion or nearly half the world’s population. A billion people go hungry everyday and two billion do not even have clean water.

The current explosion of crisis appears to begin from financial excesses in the United States (US) which cause domestic troubles that have subsequent repercussions on the rest of the world. Yet while the sub-prime loan crisis in the US housing market is the most immediate trigger, this merely reflects the system-wide problem with world capitalism of an unprecedented reliance on paper profits and digitally conjured capital. There are initial estimates that financial losses could reach up toUS$30 trillion worldwide.

Monopoly capital has for decades been seeking to maintain its profits by forcing greater trade and investment liberalization on the neocolonies. But capitalism’s basic crisis of overproduction is intractable and has even been exacerbated by this “globalization” offensive. Since these have been less and less effective imperialism has relied more and more on paper profits and digitally conjured capital. The financial crisis manifesting first of all in the US merely exposes world capitalism’s system-wide problem of an unprecedented reliance on this largely fictitious capital.

The people are also now severely burdened by rapidly increasing energy and food prices. The giant transnational oil corporations have used their monopoly control to drive prices up which has been exacerbated by speculation in oil futures markets. Neoliberal “globalization” of agricultural production and trade has destroyed backward rural food systems and depleted food supplies aside from worsening the poverty of agricultural producers. Subsidized food imports flooded domestic markets at the same time as producers have found themselves ever more tied to overpriced inputs from big foreign agri-business. The rising energy prices themselves have driven up food prices even further.

Imperialist aggression

Imperialism has become increasingly aggressive in seeking to relieve its crisis and maintain its superprofits. The intensification of the global crisis in the 1970s and the severe profit squeeze on the advanced capitalist powers drove them to seek deeper inroads into neocolonial markets through their “globalization” offensive. The people of the world have since been challenged to confront the big powers’ ever more calculating rapacity and increasing economic aggression to multiply their exploitation.

Monopoly capital forced greater trade and investment liberalization on the neocolonies to exploit their cheap neocolonial labor, to plunder their raw materials, and to capture their markets. Backward agricultural systems were overrun and vast numbers of the peasantry thrown into greater hardship. At the same time there were more vicious attacks on labor even in the advanced capitalist countries. An economic assault pressed down wages, salaries and benefits across the globe while political assaults pummeled unions and other organized workers. Usurious debt burdens were used to directly extract massive economic surpluses from the neocolonies. They were quickly plunged into a debt crisis in the early 1980s which has even been opportunistically used to increase imperialist economic and political control over them.

The 1990s also saw the expansion of global labor markets for capitalism to exploit. In particular the opening up of China, the former Soviet Union, Eastern Europe and the greater openness of various Southeast and South Asian economies effectively doubled the number of people for exploitation. Imperialism tapped these hundreds of millions both through setting up investment enclaves overseas as well as by directly bringing in migrant labor or taking advantage of displaced refugees. Social services and public utilities were turned into sinister opportunities for profit.

However the limits of these wide-scale efforts to support capitalists’ profits – at the expense of deepening misery on a global scale – could not but assert themselves. The economic dispossession of large swaths of humanity further constricted opportunities for investments which in turn further accentuated the glut of finance capital. By the 1990s imperialism increasingly relied on getting its profits from purely financial schemes disconnected from any productive activity. Parasitic capital took advantage of advances in information and communications technology not just to facilitate its global production networks but also to fashion complex financial instruments for creating profits outside of any actual productive activity.

Imperialism sought to surmount its crisis with a bewildering array of financial instruments that created unprecedented debt- and speculation-driven illusions of prosperity and growth. Global financial assets include equities, private and government debt securities and bank deposits. These have bloated sixteen-fold from US$12 trillion in 1980 to an estimated US$190 trillion in 2007, over a third of which are in the US. In 2006 the value of global financial assets was equivalent to 350% of global gross domestic product (GDP). Superconductive finance capital destabilizes economies of entire regions at a time and there was a record US$8.2 trillion in cross-border capital flows just in 2006.

Previously unseen levels of profits were made from sheer speculation. But while seemingly increasing the capital stock these huge amounts of capital existed only digitally and were greatly diverging from real economic values. Yet the eventual economic impact of massive financial losses is very real.

The self-limiting and destructive nature of this conjured economic dynamic was soon exposed. The financial crisis that started in Asia in 1997 and that quickly spread around the world, including to the US in 2000, showed up the vagaries of financial markets. The adverse effects on the real economy of footloose international capital rapidly crossing borders were clearly seen.

All those problems continued to mount in the 2000s and are now coming to a head. Global markets kept on constricting in the face of the imperialist economic offensive. The relentless “globalization” of trade and investment continues to destroy productive forces in neocolonial agriculture and industry: subsistence farming, backward agriculture and incipient manufacturing industry. The working people in the advanced capitalist economies continue to suffer low remuneration for their labors. Debt and speculation are used not just to generate financial profits but also to artificially inflate demand and counter stagnation. But the resulting shallow growth in construction, real estate, commercial trading and finance sectors cannot compensate for long the pressures narrowing global markets. Despite the supposedly rapid growth in the last few years there are shrinking opportunities for genuinely productive investment.

Global capitalism is fundamentally limited in how it deals with the crisis because this is rooted in the system’s basic contradiction between private profit and social production, and in the resulting crisis of overproduction. Among the false solutions it is floating are neo-Keynesian New Deal-type fiscal stimulus, financial lifelines and bail-outs, and “reforming” the global financial architecture towards greater financial governance. These will all ultimately fail not just for being limited efforts but more so because they pretend that the problem is merely about financial excesses and resulting inadvertent instability. Yet the problem goes much deeper.

Imperialism’s financial crisis

The situation of the US economy is illustrative and shows problems of the capitalist system in sharp relief. Real average and minimum wages started to steadily increase after the 1940s. These however became basically stagnant upon the onset of intensified crisis in the early 1970s causing the share of wages and salaries in national income to steadily erode. By 2006 this had already reached its smallest share of national income on record. The share of corporate profits on the other hand has correspondingly been rising and by 2006 was at its highest since 1950.

There was a seemingly rapid accumulation of capital since the 1980s and particularly since the 1990s. US financial assets which were equivalent to less than four times GDP in 1980 had by 2007 soared to over nine times GDP. In the late 1990s the share of financial profits in total corporate profits conspicuously increased from less than 20% to over 40 percent. This is even as the financial services sector accounts for only 5% of US private sector jobs.

But since these were largely merely paper capital it is inevitable, albeit unpredictable, for the financial bubbles to burst. This is exactly what is happening where the bubble-driven finance, construction, real estate and retailing boom is now going bust. Combined household, corporate and public debts have risen to an unprecedented and clearly unsustainable US$51.1 trillion in 2007 which is equivalent to nearly four times US GDP of US$13.8 trillion. Public debt breaks down into federal (US$9.2 trillion) and state debt (US$2.2 trillion) while private debt is composed of financial sector debt (US$15.8 trillion), business sector debt (US$10.1 trillion) and household sector debt (US$13.8 trillion). Financial losses started in sub-prime loans but these will likely cascade into prime loans, commercial real estate loans, consumer credit, corporate credit and perhaps even much-vaunted public credit.

The depth of the problem has already invited comparisons with the US recession in 1927 that eventually led to the stock market crash in 1929 which marked the start of the Great Depression. On the ground, tens of millions of Americans are facing crushing personal debts and uncertain futures. The number of Americans jobless or otherwise seeking more work has been rising particularly since the start of 2008 and now number some 15 million. Notable meanwhile is the resurgence in military production and rising militarism conspicuously accompanying rising competition between the imperialist powers.

In the 1990s the bulk of adverse effects occurred when financial crisis erupted that dragged down real economies. Today however the financial excesses have even greatly expanded into speculation in commodities which has resulted in ever more direct effects on the people through grossly higher oil and food prices. Among others this has driven oil industry profits to record highs with US$155 billion in profits in 2007, three-fourths of which are of just the top five oil firms. The speculation in food markets has also greatly aggravated the destruction of neocolonial food systems.

Continuing challenges

The people face great challenges in the struggle against the oppression and exploitation intrinsic to capitalism and that are deepening further. Imperialism’s international mechanisms for the domination of world trade, investment and economic life continue to set global rules and distort national economies. They establish exploitative economic relations between advanced capitalist powers and neocolonies. The international finance institutions of the World Bank (WB), International Monetary Fund (IMF) and other regional banks are thoroughly discredited but remain influential. Even if the talks at the World Trade Organization (WTO) have stalled it remains imperialism’s most potentially expansive mechanism for pushing its plundering agenda.

Particularly important in the last few years are the bilateral and regional free trade agreements (FTAs) that the US, European Union (EU) and Japan are using to tighten their domination of individual countries and regions. From just a few dozen FTAs in the early 1990s there are now some 340 in various stages of talks as of mid-2007. And there is also how the US has for instance already seized and opened up economies through sheer military coercion and aggression.

In the neocolonies these burdensome socioeconomic policies are done with the compliance of increasingly subservient governments. They craft the domestic economic regimes most favorable for imperialism and its need for profitable opportunities and outlets for its capital. They maneuver to deliver labor and natural resources to imperialism at the cheapest possible price. And they wield state force to stifle peoples’ resistance and to try and make the masses docile and submissive.

In the end the world remains divided into rich and poor, and into exploiter and exploited. On one hand are the strengthening of global monopolies and their increasing economic domination and ruthlessness. Forty-six of the world’s 50 biggest transnational corporations are from the US, EU and Japan. Similarly, nine-tenths of global foreign direct investment outflows totaling US$1.2 trillion in 2006 were from the advanced capitalist countries. Investment payments and the servicing of neocolonial external debt – which reached US$3.4 trillion in 2007 – resulted in a massive net financial transfer from the neocolonies of US$670 billion just in 2006.

The greatest share of the world’s income remains concentrated in the imperialist countries that, as of 2006, have only 16 percent of the world’s population but account for three-fourths of global GDP. Starkly, the world’s 500 richest individuals had a net worth of US$2.6 trillion in 2005 which is equivalent to the annual national income of the world’s 48 poorest countries or the world’s poorest 416 million people.

Meanwhile the majority of humanity is chronically deprived with generation upon generation going through lifetimes of hunger and destitution. The world’s working people have less and less options for decent living, they are losing jobs and livelihoods, and their incomes are collapsing on a massive scale. Some 1.5 billion people do not have or are otherwise lacking jobs in 2007 – the 190 million unemployed and 1.3 billion so-called “working poor”. Farmers, workers, indigenous communities, especially women and children, are driven into deeper misery. It is urgent for the people to achieve socioeconomic development, social equity and justice.

The people’s struggle

Hundreds of millions of the people across the imperialist countries and in the neocolonies have risen up to expose and resist imperialism’s economic aggression. The ranks of the oppressed working people that are mobilizing have broadened and prevented imperialism and neocolonial governments from easily pushing through with their plundering agenda. This strengthens the ability of the people to face the great challenges in the struggle against the oppression and exploitation intrinsic to capitalism.

The peoples’ struggle for socioeconomic development against imperialism is integral to the overall struggle for national liberation, democracy and social liberation. This includes the commitment of the people of the exploited countries and nations to confront imperialist systems of plunder, exploitation and oppression, and to assert sovereignty and independence. All grossly unequal imperialist trade and investment deals and policies must be outrightly rejected. Alternative international relations of cooperation and solidarity between peoples must instead begin to be built. The efforts to build more progressive and democratic economies will be all the more effective the more peoples there are working together on a regional and global scale.

Neocolonial domestic economies must be rebuilt and drastically transformed so that our countries’ natural resources and our peoples’ labors serve the needs of the masses most of all. This means a socioeconomic program serving and thus wholeheartedly supported by the people. This shall redistribute wealth to peasants and workers and other basic sectors, beginning with true agrarian reform development that breaks feudal backwardness in the world’s vast countryside. There must also be genuine national industrialization. The people’s basic and vital needs for education, health and housing must be assured. We will take approaches as appropriate depending on the sizes, resources and economic strengths of our economies.

A humane, equitable and just path that does not exploit other peoples and economies and that is ecologically sound is being charted. The masses will be decisively in control of their lives, as well as at the center of building just and peaceful societies. The need to continue building and strengthening democratic mass movements is as urgent and vital as ever as well as underpins our movements for national liberation. The accelerating economic deterioration points in the direction of an upsurge in social and revolutionary movements worldwide.###

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By Prof. Jose Maria Sison
Founding Chairman, Kabataang Makabayan
September 11, 2008

Download .doc version: “Neoliberal” Globalization JMS

Thank you for inviting me to speak on the policy of “neoliberal” globalization and the worsening economic crisis in the Philippines on the occasion of the 31st anniversary of the founding of the League of Filipino Students (LFS). I congratulate the LFS in Baguio City for its achievements. I appreciate the cooperation of the LFS with the Anakbayan, UP Baguio-University Student Council, the Nationalist Corps and the Politically Inclined Students in bringing about this important forum.

“Neoliberal” Globalization

First of all, let me explain what the policy of “neoliberal” globalization is all about. It is a policy of deception, misrepresenting monopoly capitalism as “free market” capitalism. It has been adopted since 1980 supposedly to solve the problem of stagflation, the phenomenon of stagnation and inflation going together and the vicious cycle whereby the attempt to solve either one of them aggravates the other.

In pushing the policy, Reagan and Thatcher identified Keynesian and social democratic state intervention as the root cause of stagflation for generating wage inflation and “excessive” social spending. They therefore espoused giving full play to the “free market” and giving the monopoly bourgeoisie and the giant corporations all the opportunities to raise capital resources, make profits without restrictions and get big tax cuts supposedly to develop the economy, generate jobs and make the working people less “dependent” on government.

To achieve the “neoliberal” or “free market” objective, the imperialist states headed by the US have launched an unrelenting attack on the hard won rights of the working class to job security, trade union organization and social benefits. Wage levels have been pushed down. Full-time regular jobs have been replaced to a great extent by part-time jobs. Indirect wages as may be in the form of social insurance, medical insurance, educational benefits and social services have been cut back or cut off. The real incomes of the working class have relentlessly fallen.

However, the “neoliberal” policy has given the multinational banks and firms of the monopoly bourgeoisie all the opportunities to accumulate capital and reap profits through the liberalization of investments and trade, the privatization of state functions and assets, the deregulation at the expense of the working people, women, children and the environment and the denationalization of the economies of underdeveloped countries.

According to the “neoliberals” or “free marketeers”, it is wrong to use the direct hand of the state for pursuing economic development and ensuring social welfare. But it is perfectly correct to hand out state resources, state contracts, subsidies, investment insurance and tax exemptions to the giant corporations and likewise to engage in accelerated military spending. No to social welfare but yes to corporate welfare. No to social spending but yes to military spending.

The “neoliberals” have missed the essential point about the problem of stagflation. When it arose in the 1970s, it was because Germany and Japan, which had been ruined in World War II, had reconstructed under the Marshall plan and all imperialist powers were once more caught up in a serious crisis of overproduction as a result of competition and profit-making at the expense of the workers. All capitalist economies were pressing down the wage levels in order to maximize profits and counter the falling rate of profits in the course of expanding production. At the same time, the US led the way in undertaking inflationary activities, including the profuse flow of US dollars abroad, the global deployment of US military forces and the war of aggression in Indochina.

The crisis of overproduction is consistently at the base of the crisis of the US and world capitalist system. By pushing down wages to maximize profits, the monopoly bourgeoisie unwittingly contracts the market for the products of expanding production. The crisis of overproduction becomes conspicuous when large stocks of goods cannot be sold, production has to be cut down and workers are laid off.

From decade to decade, since the late 1960s, the crisis of overproduction has become worse, with the problems of unemployment and inflation becoming more sticky and the growth rates actually stagnant. But since the official adoption of the “neoliberal” policy, the trick to conceal the economic problems has been to increase the money supply and make credit easy for the giant corporations and for the consumers in the huge American market. As a result, we now see a gigantic financial crisis generated by the US.

The US has lived off the people of the world by abusing confidence in the US dollar as global currency. It has gone into industrial decline by heavily importing consumer goods from East Asia. It has incurred trade deficits and has become the world’s biggest debtor. It has also gone into heavy budgetary deficits and domestic debt by rapidly increasing expenditures for military production contracts and global deployment of military forces, especially in Iraq and Afghanistan.

It is not only the US federal government that is heavily indebted but also the giant corporations and households. All of them are unable to pay their debts and are the major factor in the current financial crisis afflicting not only the US economy but the entire world economy. Twice have the US households been victimized in a big way since 1995 through credit and financial manipulations.

First, fund managers invested the pension funds of US workers on the hightech bubble which lasted until it burst in 2000. US households were enticed to purchase stocks on margin. At least 40 per cent of them did so. Subsequently, in a more sweeping way, US households were encouraged to buy on credit into the housing bubble which began to burst in 2006. The “neoliberal” policy makers and managers of the US economy had devised the housing bubble to provide US households an artificial source of further credit for consumption, keeping up their role as the biggest consumer market of the world despite the decline of industry and regular employment in the US.

But the US mortgage meltdown, which has become conspicuous since last year, has exposed not only the wobbly US financial system but also the financial plague the US had spread all over the world. The US banks and hedge funds, in concert with the Fannie May (Federal National Mortgage Association) and Freddie Mac (Federal Home Loan Mortgage Association), the two biggest state-backed mortgage banks, had repackaged the bad mortgages into collateralized mortgage debts and asset-backed securities and sold them to the biggest banks in various countries. Not only is the mortgage meltdown exposed but the whole range of economic and financial crisis in the US and in the world.

The current financial crisis, which is the worst since the Great Depression, has resulted in the tightening of credit, economic recession in the imperialist countries and depression on a world scale. The underdeveloped countries are victimized by the tightening of credit and decreased orders from the imperialist countries for raw materials and semi-manufactures.

Despite global economic depression, some sectors in imperialist countries have found ways of raking in superprofits and conjuring the illusion of positive growth rates in imperialist countries and even on a global scale. They are the giant corporations in fuel and food, which are the most basic necessities of all countries. They are inflicting terrible and intolerable suffering on the people of the world, especially those in the underdeveloped countries.

Impact on the Philippines

As a semi-colonial and semi-feudal country, under foreign and feudal domination, the Philippines has an inherently and chronically crisis-stricken economy and society. The only way it can end the underdeveloped, agrarian, pre-industrial and semifeudal character of the economy is to undertake national industrialization and land reform. These were previously prevented by the World Bank-sponsored Keynesian fiscal policy of promoting infrastructure-building to serve raw material production and commerce.

The current “neoliberal” globalization policy of denationalization, liberalization, privatization and deregulation has been far more aggressive in preventing industrial development and land reform. Under this policy, the Philippine economy has become more deeply underdeveloped and more rotten than before and become more vulnerable to the worsening crisis of the world capitalist system.

The “neoliberal” policy is imposed on the Philippines by the US through its puppets. It expressly prohibits the leaders of the reactionary government from upholding the key role of the state in mobilizing the people and economic resources for national industrialization and land reform. These twin objectives are supposed to be decided by the market rather than by the state and the people. Under the influence of “neoliberalism”, puppet leaders in the Philippines talk more often about the “free market” than “development” as state-supported industrial development.

The expression “free market” is actually used to mean leveling the field of competition with the bulldozers of the foreign monopolies and flattening the people to the ground. The expression “development” is limited to mean infrastructure-building with the use of onerous foreign loans and foreign supplies as in the time of the Marcos regime. None of the succeeding regimes since that of Aquino, which hyped trade liberalization, have paid even the slightest lip service to a well-founded and comprehensive industrial development, through the cooperation of the state and the Filipino entrepreneurs.

The 1987 constitution of the reactionary state has reduced land reform to a “free market” transaction, with the landlord selling his land voluntarily, demanding current market value or offering the stock distribution option. The principle of state intervention in order to realize social justice, such as the expropriation of landlord estates for affordable redistribution to the tenants, has been laid aside. The landless tillers are given the cynical advice that if they wish to own land they are free to buy even a piece of Forbes Park or buy stocks from Hacienda Luisita of Cory Aquino or from any of the many agricultural corporations of her cousin Danding Cojuangco.

Under the Ramos regime, the so-called medium term development program did not provide for national industrialization and land reform. But it pushed for the denationalization of the economy to benefit the foreign monopolies and big compradors. It violated the principles of economic sovereignty and conservation of the national patrimony. It removed the restrictions on foreign investors in banking, mining, agriculture, domestic trade and other types of enterprises. It allowed the unrestricted flow of foreign capital in and out of the country and the big comprador exporters of raw materials to stash away foreign exchange abroad. It ran far ahead of the schedule set by the WTO for lowering the tariff on all types of products.

The reactionary government incurred huge local public debt and foreign debt for infrastructure, especially in graft-ridden power generation projects conceded to foreign companies. It went into a privatization spree, selling off state assets and prime public land to foreign investors in order to cover trade and fiscal deficits. It created a boom in the private construction of office and residential towers and golf courses with the use of foreign commercial loans and favored the expansion of low value-added semimanufacturing of consumer goods under the auspices of giant corporations and big comprador firms, whose foreign debts are guaranteed by the state.

The financial crisis of 1997 brought down the Ramos regime’s claims to economic success. By the time Estrada became president, the reactionary government had gone bankrupt and foreign credit dried up to the extent that he was compelled to serve his corrupt appetite by taking payoffs from jueteng and using social security funds of government and private employees for the shadiest of deals. He was reduced to begging for infrastructure loans from Japan, which wanted to extract excessive trade and investment privileges.

When the turn of Arroyo came, she renewed the orgy of local and foreign borrowing and the frenzy of implementing the “neoliberal” economic policy which she had strongly pushed as a senator. The imperialists were pushing another wave of easy credit in accordance with the “neoliberal” dictum that economic and financial problems are solved by scooping money from the central bank into helicopters for these to pour out on the problem.

Under the “neoliberal” economic policy, the semicolonial and semifeudal character of the Philippines has been aggravated and deepened due to the absence of national industrialization and land reform, the unrestricted freedom of the foreign monopolies to dump their surplus products and to extract superprofits, the ceaseless landlord and corporate accumulation of land, bureaucratic corruption, the limitation on the country to produce for export only raw materials and slightly processed goods, the ever growing trade and fiscal deficits and the ever mounting foreign debt.

Like the Ramos regime, the Arroyo regime has been strenuously insistent on the denationalization of the economy. It has made so many attempts to have the 1987 constitution amended so that nationality requirements and restrictions on foreign investors can be removed from the economic provisions. At any rate, it has pushed further legislation as well as multilateral and bilateral treaties and executive agreements to promote investment and trade liberalization in favor of foreign investors to the detriment of economic sovereignty, the national patrimony, the working people and the environment.

It has allowed the dumping of foreign surplus manufactures and agricultural products on the country and has thereby undermined and destroyed the domestic production of these. It has continued the privatization of state assets and public lands. These have been sold to foreign corporations and to cronies. Laws seeking to protect the workers, women, children and the environment have been eroded or circumvented in the “neoliberal” spirit of deregulation for the profit-taking purposes of foreign monopolies and the big compradors.

The Arroyo regime has gone into unbridled deficit spending and foreign and local borrowing, mainly for the purpose of profit-taking by the imperialists and the big compradors, bureaucratic corruption and upper class consumption. Statistics of these go into the absurd game of conjuring the illusion of an annual economic growth rate. Counterproductive activities and borrowings which bankrupt the state and the economy are misrepresented as factors of development. Even as the economy is bankrupt and depressed, the Arroyo regime is giving top priority to servicing the foreign debt and is raising the tax burden on the people.

The Arroyo regime is overbrimming with loyalty to its imperialist masters. But now it is faced with the severe problems generated by the crisis of the US and world capitalist system. International credit has tightened. Foreign orders for raw materials and consumer semi-manufactures have decreased. To make matters worse, the prices of fuel and food imports are soaring. The giant oil and food companies have fabricated the media tales of fuel and food shortages in order to make a big killing in the “free market.”

The regime does nothing to restrain the foreign monopolies from ceaselessly hiking the oil price and inflating the prices of all basic commodities. For so long under the policy of trade liberalization, it has allowed the dumping of rice from abroad and has thus destroyed local rice production. It has made the Philippines the No. 1 rice importer of the world. It has also been utterly stupid in failing to build its reserve rice stocks and thus in having to buy rice from the world market when the prices are soaring.

Tasks of Filipino Students

The Philippine economy and society are plunging from one level of crisis and depression to another.
The Filipino students are suffering the rapidly rising costs of study and living and need to cope with so many problems arising from the oppression and exploitation of the entire people by foreign monopoly capitalism, domestic feudalism and bureaucrat capitalism.

It is of urgent and great importance for the League of Filipino Students and all other patriotic and progressive youth organizations to arouse, organize and mobilize the student masses in their millions. You must unite and fight against “neoliberal” globalization and all other inimical policies of imperialism and local reaction. These are detrimental to you as students and youth because you now face not only the current rising costs of study and living but also the dire prospects of unemployment in an increasingly crisis-stricken and rotten ruling system.

You must also fight the US-instigated war of terror. This has taken the form of state terrorism and direct US military intervention in the Philippines and the US wars of aggression in Iraq, Afghanistan and elsewhere. The violence that the US has unleashed all over the world is aimed at forcing the people to submit themselves to exploitation. It is the complement to “neoliberal” globalization. US imperialism is behind the gross and systematic violation of human rights by the Arroyo regime and its armed minions. We can expect the escalation of exploitation and oppression, under the US-instigated policy of “free market” globalization and the US global war of terror.

You must conjoin with the broad masses of the Filipino people in the struggle for national liberation and democracy against US imperialism and the local exploiting classes. You must carry out all possible and necessary forms of struggle to advance the revolutionary cause. We can prepare for and proceed to the socialist revolution only by completing the new democratic revolution, by victoriously finishing the unfinished Philippine revolution initiated by our revolutionary forefathers. The people have high hopes in the Filipino youth as a resolute and militant force for revolutionary change.###

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