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The Long View

Big business and the baron

A Nikkei Asian Review article (“Crony capital: “How Duterte embraced the oligarchs,” by Aurora Almendral) recently probed the President and his friends and enemies in the business world. There are four things that the article brings to mind.

The first is the need for a closer focus on the President’s interactions with big business during his two decades of power in Davao. The President was not an unknown quantity to big business, regionally and nationally. They had, and have, relationships with him as they do with all the big provincial barons. Foreign Secretary Teodoro Locsin Jr. once emphasized on Twitter how the Davao Ayalas were strong boosters of the President, for example.

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The second is the composition of the coalition that brought him to, and sustains him in, power. It was a coalition with the Arroyos, the Marcoses and the Villars formally and informally linked together: The Villars lent a vice presidential candidate even as the real Veep of the President was the running mate of Miriam Defensor-Santiago; the President himself used the PDP-Laban as an electoral vehicle (FVR was part of this coalition, too, but quickly lost influence). Big Business traditionally hedges its bets, quietly supporting all the major candidates even if some individual conglomerates or families might back certain candidates publicly. The Makati Business Club (MBC) may have been the odd man out in sticking to Grace Poe, which fueled the split in the former ruling coalition (the President’s predecessor) and left them vulnerable to the President’s ire — or, to be precise, populist posturing.

But here, the President was careful to tailor his messages to his various audiences. To be sure, the campaign was fueled by middle-class indignation over the poor being prioritized, and the periphery and not Metro Manila being the focus of the outgoing administration’s efforts. But Big Business had its gripes, too. It resented having a government that in the main did not question that they had a role to play, but on a level playing field; this accounts for the MBC-affiliated big players, or many of them, at least, going for Poe. Still, when the President went to give a campaign speech before the MBC, he had a message tailor-made for them: He was, he said, skeptical of land reform.

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A subset of the coalition is the Marcoses. The President’s balancing of the spoils system — rewarding supporters and backers — has been tempered by what sometimes seems his puzzling detachment when it comes to Ferdinand Marcos Jr. coming close to his goal of securing the veephood, but failing; he’s essentially left the Marcoses to their own devices, paying his debt to them by means of the Marcos burial and assisting in their political rehabilitation. For the Marcoses to once again be at the summit of power, however, would be disruptive to tycoons who might be on the Marcos hit list dating from their exile. That would reinforce the President’s not rushing to mobilize the formal and informal powers of his office to clinch the vice presidency for Ferdinand Jr.

The third is the impact, related to the first, of the main foreign business competitors joined at the hip with their governments, specifically Japan and China. Here, again, the President was not an unknown quantity. Japan, dating to the prewar Commonwealth, has had a strong presence in Davao and thus a strong institutional memory, not to mention tried-and-tested political contacts with its kingpin of 20 years. China, perhaps less so — but here the coalition was useful, particularly the Arroyos; by all indications, FVR’s more detached attitude helped sideline him. The scramble for influence was evident practically from day one, when first, the President announced that his first major foreign visit would be to Tokyo, and then, it became Beijing. But as the battle over railways shows, the Japanese have proven every bit as willing and able to marshal Philippine official support for their projects.

The fourth is the composition of the President’s economic team, his secretary of finance in particular being central to whatever policy is being pushed at any given time. His presence in the Cabinet is perhaps the single most important factor in attracting, then sustaining, business confidence in the administration. His presence reassures them that even if individuals might catch the President’s ire and all that entails (not all of it, nor even possibly most of it, publicly played out the Bureau of Internal Revenue can make life difficult for business people and every single one of their relatives and their businesses in turn), these are isolated incidents for effect; and there is someone to run to, to quietly sort things out.

This has been a business-friendly administration from the start, led by an establishment figure with an establishment point of view.

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TAGS: Big business, Duterte's supporters, Manuel L. Quezon III, oligarchs, Rodrigo Duterte, The Long View
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