• UP honors martial law pillar

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    (Second of two parts )

    THE University of the Philippines honors Cesar Virata by renaming its College Administration for him. By doing so, it is revering one of the main pillars of martial law and passing judgment that the dictatorship was on the whole good for the country. Virata was of course Marcos’ Finance secretary and Prime Minister.

    If this is the belief of UP President Alfredo Pascual and the Board of Regents, then they should declare so, and let the academic community debate on it.

    It is the height of intellectual dishonesty for the business college’s dean Ben Pascual Gutierrez, to justify the proposal by asserting that Mr. Virata is ”an influential man in the business community”, and that ”he laid the essential foundations for the development” of the college, and so on.

    What defines Virata—his life’s work, as it were—was his deep involvement in the dictatorship as Marcos’ chief technocrat for 13 years from 1972 up to the minute he fled the country.

    Marcos gave him full authority to run the economy, which fell into the deepest recession the country ever experienced, condemning millions of Filipinos to a life of poverty.

    He never publicly protested then and now the killings and torture of Filipinos, many of whom were students and faculty of the university that is now about to honor him. He was a true believer of authoritarian rule, as his friend F. Sionil Jose inadvertently disclosed in his two-part puff piece on Virata in the Philippine Star:

    “When asked by an American journalist what he thought of the [imposition of the martial law regime]Virata said, perhaps facetiously, that the Philippines had joined the rest of Asia.’ After all, many of the Asian governments at the time were openly authoritarian.”

    Sionil quoted Virata: “The experience of our neighbors with their authoritarian governments was positive. I thought, perhaps, we would be able to do the same.”

    A common description of Virata has been that he was untainted with corruption despite his enormous power during martial law. “I just did my duty,” Virata told Sionil.

    But he certainly didn’t need to make money on the side. The Commission on Audit in 1983 reported that Virata was chairman or member of the board of directors of 22 government entities. If included were his posts representing the Philippines in the International Monetary Fund and World Bank, he would have 24 seats—beating Imelda Marcos who had 23 seats. If he got just P50,000 in salaries and honoraria from each of these government firms, he was making P1.2 million a month, a fortune during that time.

    I asked Virata once in an open press conference to comment on this. He replied that the seats were ex-officio ones, that his post as Finance secretary required him to be there. Right. But he could have designated his underpaid undersecretaries and assistant secretaries to represent him, or maybe he could have waived his compensations in these firms to set an example for the bureaucracy.

    The Supreme Court in a 1991 ruling involving the legality of government officials seating in many boards had harsh words for them: “Unscrupulous public officials who took advantage of this scheme for purposes of enrichment.”

    Our GDP contracted 7 percent in 1984 and another 7 percent in 1985, a loss of economic output that set back the Philippine economy back a decade. This was the biggest factor that led to Marcos’ fall, as the elite made up their mind that the dictator would bring everyone to ruin, and therefore had to be overthrown.

    Why did the economy collapse? In his Q & A with Sionil, Virata blamed it on so many factors: “The rapid increase in oil,” ”inflation”, “stress on the exchange rate and the foreign exchange reserves of the country. “

    A word he didn’t mention even once: debt. From just 33 percent of our GNP in 1972, our foreign debt stock ballooned to 98 percent just before Marcos fell. Debt service as a percentage of the nation’s dollar income rose from 150% in 1972 to 326 percent—levels the country couldn’t afford.

    The economy’s collapse was essentially a debt-crisis, similar to the ones that recently broke out in Greece and Cyprus. The country borrowed too much that it defaulted on the loans in October 1983, so that we were shut out as a pariah in the global financial community.

    And who was in charge of the economy, in particular managing the country’s debts ? Finance Secretary Virata. In Sionil’s paean to Virata, he wrote, obviously clueless to its import:

    “(Tired of Imelda’s complaints about Virata), Marcos said, ‘Without Virata, we cannot get the foreign loans we need since he is the man these institutions trust.’”

    One of the biggest chunks in our foreign debt, and the most wasted, was the $2.2 billion loan contracted to finance the Bataan Nuclear Power Plant, which was aborted when Cory Aquino assumed power.

    And who pushed for it together with Energy Secretary Geronimo Velasco? Virata.

    Even after Marcos crony Herminio Disini was exposed in 1978 as to have received commissions from the supplier Westinghouse, Virata and Velasco were still negotiating with the company to lower the cost of the plant that had risen because of imposition of new safety regulations in the US in the wake of the 1979 Three-Mile island nuclear plant accident. As late as October 1982 Virata was even raising $250 million in the Euro-dollar market to cover partially the cost overruns of the nuclear plant.

    Aside from Virata, the two other pillars of martial law were Defense Secretary Juan Ponce Enrile and Armed Forces Chief of Staff Fidel Ramos. But their consciences couldn’t let the killings – even the brazen assassination of Ninoy Aquino—go on. Enrile attempted a coup against Marcos, and when it failed Ramos went to defend him—and triggered the People Power Revolution.

    In contrast, Virata remained Marcos’ true believer to the end. UP professor Teresa Encarnacion-Tadem in a paper published last year based on extensive interviews with Virata wrote:

    “During this period (after Ninoy’s assassination) Virata said that members of the business community, such as Cesar Buenaventura of Shell Philippines and Jaime Ongpin of Benguet Mining Corporation, were pressuring him to resign to bring about the downfall of Marcos. Virata did not agree that the major issues to be addressed were corruption and the government’s economic policies and felt that these business leaders just wanted Marcos out.”

    The Batasan Pambansa, first as an “interim body” and then as a permanent one supposedly authorized by the 1973 Constitution that Marcos had imposed, was the dictator’s grand scheme to fool the world that he lifted martial law in 1981 to create parliamentary democracy. It was a fake body, with a token opposition and packed with Marcos’ Cabinet members and his local political leaders elected in sham polls, in many cases through a show of raised hands.

    Virata assumed there a new role as a politician, believing that he deserved to be member of parliament as he was elected to represent Cavite. In 1981, Marcos ordered the Batasan to elect Virata as Prime Minister, in his effort to portray to the world that a technocrat—the IMF, the World Bank, and Washington’s favorite boy in Manila—was in control of the economy.

    It is astonishing how a man of Virata’s intelligence could delude himself into thinking that the Batasan was a genuine parliament and that he was elected by his peers, and not appointed by Marcos as his deodorizer to the world.

    Tadem wrote: “Virata resigned as Minister of Finance on 16 February 1986… However, Virata did not resign as prime minister because he said he was elected to this position by the people and resigning would have meant a dereliction of his duty. Virata eventually learned later that Marcos offered the prime ministership to Juan Ponce Enrile to abort the military mutiny but Enrile refused the offer.” [Emphasis mine.]

    “On 26 February 1986, Virata also resigned as prime minister although the president told him not to announce it, ” Tadem wrote. Marcos fled from Malacanang after midnight February 26. Virata was loyal to Marcos to the very last hour of the dictator’s rule.

    After that, Virata, with his vast knowledge on and contacts in the Philippine bureaucracy and the financial world accumulated over more than a decade, was in high demand by the business sector and since 1986 had advised big businesses how to make bigger profits, until he settled down as corporate vice chairman of Rizal Commercial Banking Corp. I am not aware of any philanthropic project he has undertaken, nor any social cause he has championed.

    Virata may be a nice, unassuming man with not a mean bone in his body. But a role model for the youth that the UP’s Board Regents named its business school for him?

    E-mail: tiglao.manilatimes@gmail.com
    Websites: www.rigobertotiglao.com and www.trigger.ph

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    11 Comments

    1. As a UP Professor with 25 years of public service dedicated to the pursuit of academic excellence and socially-relevant scholarly research, I am outrageously appalled at this travesty. It is as if UP has consciously and deliberately spat on the graves of martyrs and trivialized the untold sufferings of other victims of the rogue Marcos martial law regime, many of whom were UP graduates and students. New research studies on Virata’s role during martial law have recently come to light, as indicated in Tiglao’s piece. I, myself, have a forthcoming publication on Virata’s culpability in Marcos’ failed agrarian reform program.

    2. Larry Najera on

      WE BEG TO TAKE EXCEPTION TO ROBERTO TIGLAO’S STATEMENT THAT “A COMMON DESCRIPTION OF CESAR VIRATA HAS BEEN THAT HE WAS UNTAINTED WITH CORRUPTION DESPITE HIS ENORMOUS POWER DURING MARTIAL LAW “.

      AFTER MARCOS DECLARED MARTIAL LAW IN 1973,HE DIRECTLY ORDERED THE BIR TO INVESTIGATE THE INCOME TAX LIABILITIES OF ALL HIS INCUMBENT CABINET MEMBERS COVERING THE PERIOD FROM 1967 THROUGH 1972.
      THE EXHAUSTIVE TAX INVESTIGATION FOUND,AMONG OTHER THINGS, THAT CESAR VIRATA INTENTIONALLY DID NOT INCLUDE IN HIS INCOME TAX RETURNS FOR THE PERIOD FROM 1967 THROUGH 1972 ,VARIOUS INCOME SOURCED FROM SYCIP GORRES VELAYO & COMPANY(SGV)REPRESENTING SALARIES, ALLOWANCES,ETC.,AS EVIDENCED BY THE WITHHOLDING TAX RETURNS FILED BY SGV WITH BIR FOR THE SAME PERIOD. VIRATA RECEIVEDTHE AFORESAID INCOME WHILE HE WAS ALREADY IN THE GOVERNMENT SERVICE INITIALLY IN THE BOARD OF INVESTMENTS(BOI) AND LATER AS
      SECRETARY OF FINANCE.
      VIRATA,THEREFORE, WAS NOT ONLY ASSESSED FOR BACK TAXES BUT WAS CITED FOR VIOLATION OF THE ANTI-GRAFT AND CORRUPT PRACTICES LAW.

      AN OFFICIAL REPORT OF THE RESULTS OF THE INVESTIGATIONS CONDUCTED BY THE BIR ON THE INCOME TAX LIABILITIES OF THE THEN INCUMBENT CABINET MEMBERS WAS SUBMITTED TO THEN PRESIDENT FERDINAND MARCOS TOGETHER WITH CORRESPONDING RECOMMENDATIONS.

      WHAT HAPPENED TO THE REPORT? DID THE BIR PROCEED TO COLLECT THE BACK TAXES OF THE ERRING CABINET MEMBERS?WAS SDOF VIRATA CHARGED CRIMINALLY FOR THE VIOLATION OF THE ANTI-GRAFT AND CORRUPT PRACTICES LAW? EVIDENTLY, NO ONE WAS METED ANY PENALTY,NOT EVEN A “A SLAP ON THE WRIST”,SO TO SPEAK.
      THE REST IS HISTORY.

      • 12jun2013

        @l.najera, marcos had all the aces under his sleeve. use your imagination. marcos had the dossiers on ” hired-gun technocrats”.

    3. “THE University of the Philippines honors Cesar Virata by renaming its College Administration for him. By doing so, it is revering one of the main pillars of martial law and passing judgment that the dictatorship was on the whole good for the country. Virata was of course Marcos’ Finance secretary and Prime Minister.”

      I am sorry but when did the dean of CBA and the president of UP become the whole of “THE University of the Philippines”. The student body takes up majority of the blame because we are part of this statement, and not just the students from Diliman but all the students who study in the different branches. This article indirectly attacks not just the University but all of its students as well. Thousands of unsung UP graduates have dedicated their lives to the cause of the country, and it is quite rude that we are being hailed as students that honor the martial law pillar.I myself am currently studying in this university. I admit that I disagree with the renaming of the college, but from a person coming from the former College of Business Administration (CBA), our college will always be known as the CBA to us and whatever name you change it into the truth is STUDENTS DON’T CARE. I wish only that the University not be dubbed as a supporter of the Martial Law since the students who make up the majority of the university did not even have a say in this issue. Rather than arguing and pointing fingers, I hope our fellow countrymen can move past this incident and think of the students because the students are the biggest assets of the University. It is a fallacy to call all students of the university rapists of its own country as previously commented by some of the contributors, and it just sucks that a lot of people always compare between universities like DLSU, Ateneo, UP or UST. Each university has their own differences that make them better and worse at the same time. Rather than competing among ourselves, I’d rather compete with leading universities in other nations.

    4. 09jun2013

      on april of 1974, aprodicio a. laquian, from intl. development research centre, ottawa,canada delivered a paper titled “martial law in the phi. to date” at the Xth annual meeting, association of asian studies boston, mass.

      in the paper, a. laquian mentioned a publication not sympathetic to the technocrats in the phils. who worked for marcos during the martial law years.

      the statement is a quote in verbatim of “laquian”…..one of the major effects of martial law in the phils. was the transfer of power from warlord politicians… to a new breed of technocrats who now have the pivotal role in policy formations, both in domestic affairs and international negotiations. these technocrats were almost invariably drawn from UP or Ateneo products in the middle or late 50’s who trained abroad. mostly in the U.S. Ivy league and top universities for their PhD or MBA’s and later returned to the Phil. to serve as deans and directors in the major universities as well as consultants to big corporations…now they call the shots in the “new society” by running sensitive and powerful offices of the regime such as the board of investments, dept. of finance, and the newly created national economic and development authority. they reportedly have no “political clout” and the sole basis of their appointment is their technical expertise” end of quote.

      and these “new power holder” are cesar virata,sec. of finance(wharton); vicente paterno,chairman of the board of investments(harvard); gerardo sicat, dir.gen,NEDA(MIT); orlando sacay, asst. sec. for cooperatives(cornell); arturo tangco,sec. of agri.(harvard); onofre d. corpuz, coordinator for human settlements development(harvard); roman cruz,jr., manager,GSIS(harvard);

      “these technocrats’ roles in marcos’ “new society” were so prominent that the public usually alludes to the “harvard mafia” in talking about them”.

      during martial law years, “marcos sets the goal, the technocrats suggest the means, and they simply proceed to the optimal way of translating plans to action”; laquian.

      mr.tiglao’s assessment of mr. virata’s roles in marcos’ regime only prove that by UP naming a college admin. in honor of the former sec. of finance during the most darkest days of the republic should be give a second look.

    5. Nelson Navarro on

      As an alumnus of the college when Cesar Virata was dean, I am offended by the very thought that his name will be forever attached to the university and the nation he has dishonored beyond words. He was after all a major pillar of the dictatorship he served to the very last minute and which he has never repudiated to this day. He has blood in his hands and the ruin of the economy happened during his watch beside Marcos. He can never feign innocence and use his being a “technocrat” as a defense. This amounts to mental dishonesty exhibited by Hitler’s minions at the Nuremberg Trials who brazenly argued that the Holocaust “would have been worse” if they had not served the Fuehrer hand and foot–and immensely benefited from the effort.

      I am told that it was a cabal led by a departing regent who maneuvered to “honor” his ally and co-conspirator under Marcos rule by bypassing the University Council and springing a surprise on the aghast Fred Pascual and the Board of Regents. It was a railroad, plain and simple in the Marcosian tradition. Pascual and company should have stood up against this cabal but allowed themselves to be bamboozled. They should redeem themselves and join the UP community in exposing this dirty trick and reversing their misguided decision.

      Cesar Virata can spare us all a nasty fight by quietly “refusing” the “honor” that he did not ask for. We will gladly suspend disbelief. On the other hand, I think he should dig his heels and allow UP an honest-to-goodness soul-searching that it never had after the dictator fell and his minions turned balimbing. We never learned and now we have Virata to remind us that the darkness remains.

    6. The comments by Mr.Tiglao might be partially right,because he perhaps was aggrieved during Marcos time,this are similar comments by the enemies of Marcos,the continued media lambasting of Pres.Marcos are continued daily in print and media,this media barrage are the concentrated efforts of the people left behind with no political power,which up to now controls the country,the irony is the current state of our nation is the laughing stock of the world,the misfits and spurious nationalist rules our country to their own greed.most of the present people still prefer the Marcos Era,life was peacefully,but not to the Yellow society,fake nationalist,the malady of our nation is the greed of this people,their efforts is to control their interest and power,this are hard facts that the present media cannot seems to swallow( except for a few ),it’s. very sad to see that are country is going down the drain.MAY GQOD HELP US

      • Alex Tan —

        You wrote “The comments by Mr.Tiglao might be partially right”. Please point out which section of the article is “NOT” right for you. I have read the entire article and I agree with everything — EVERYTHING — that is in the article.

        As to your assertion that the “current state of our nation is the laughing stock of the world” — you might be interested to know that for the FIRST TIME in history — ever — the Philippines received “INVESTMENT GRADE” status from Fitch, Moody’s and S&P and is considered a “rising star”.

        If there is a “laughing stock” here, it is UP President Alfredo Pascual, the Dean of Business College Ben Gutierrez and the Board of Regent for honoring one of the architects of the Marcos martial law regime.