Good morning, ladies and gentlemen. While you enjoy your late breakfast or your early lunch, I'd like to announce our topic for this morning here in My Open-Mike Cafe. . . . Okay, sorry. . . .
So, now-famous blogger Lila Shahani started, at our table, with the question: "What do you think?" I suppose you've read that essay by James Putzel of the London School of Economics, published on the GMA News website, titled "How Noynoy Can Gain The Moral High Ground". I hear some of you have been talking about it among yourselves in your tiny little corners in this terrazzo. Anyway, the mike's open, anyone can come up and state his claim. . . .
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PitPat: Uhm, good morning, my name's PitPat, I'm a business economist. I'm Fil-Am, from New York. . . .
You know, I totally agree with Mr. Putzel's basic argument that this is a key factor for Noynoy to take the moral high ground, ... but more importantly this is extremely key for a way to enable the farmers to become active stakeholders in agribusiness and truly make the lands productive ... this will definitely shore up our efforts to lead in agri-production again and be the net exporters (food scarcity will be a major factor in the next 20 yrs.---population, desertification, water shortage etc.---and we've got all the natural resource advantages to tap). But here's a couple issues I have with his piece.
Let me read. Putzel writes, "he should convince his family to abandon efforts ..." operative word there being "convince" ... well, that ain't good enough 'cause it won't happen. It should be done by decree within an amended CARP... later on that.
He writes, "In my book, I argued in great detail why redistributive agrarian reform needs to be undertaken swiftly, ensuring compensation for land at something below market value, comprehensive in its scope and ensuring that those who receive land have access to the means to make it productive." Okay, super! Key there is how to ensure that it can stay productive which must include a lot of consideration for capitalization, capital equipment, know-how, scale, etc. He doesn't flesh that out ... again this can be tackled by decree ... later on that.
Then he writes, "... new programmes to properly document landownership that could put it on a more solid footing, to provide incentives for those who will use the land productively to invest in it, to expand irrigation in sustainable ways (less than half of irrigable land in the country has been irrigated) and to promote modern agribusiness that could see agriculture take a much more prominent role as a growth sector in the country." Now, how do you provide incentive to a poor farmer who has no capitalization to bankroll the farming cycle, expand irrigation ... most definitely! ... and that is pure govt. for now, at least (my Dad actually built an irrigation system in Negros for the govt. ... stupid idiots now destroying it ... and guess why? ... Gov. Zayco found a new scheme to make money on a project ... ugh! ... etc., etc.
Me: Excuse me, ladies and gentlemen, let me just remind you, since our mike guest is mentioning names, I'd like to remind you all that this establishment may or may not share any mike guest's opinions, allegations, and accusations and that our guests' opinions are their own. Also, if you don't agree with our mike guest or you feel offended by anything he's saying and want to rebut without climbing up here, you can always write your rebuttal on the napkin and drop it in our comment box below. Thank you. Go ahead, Mr. PitPat.
PitPat: Okay, so here's my take. The new system should be like this:
- Govt. takes control of the land with 51% ownership of all land parcels with remaining % broken down by 20% to farmer co-op and 29% to current landed family. This will be under a 40. yr-term lend-lease type o' program.
- Govt. guarantees all crop loans, and COA co-audits with private accounting firms the financials - NIA, NEDA, etc. can all have their share of helping in the management---not hard to carve out naman who will do what.
- All loans, capital equipment, etc. of current landed family will be put in receivership under the govt.'s 51% stake and guaranteed 50-50 by the central govt. and provincial govt.
- Soft capital will be provided in two ways: at discounted rates from the private banking sector, and through municipal/provincial agri-bonds that will be sponsored by the national govt. and added as a traunch of the national govt. issues (for large provinces they should be able to sell out right in open markets---in 'Pinas or even outside the country).
- Family will be managing partner with 40% interest in the gross revenue returns (fairly rich since they're no longer burdened by any debt).
- Farmers will not have any share in any operating costs or any outstanding or future debt, but they will get 30% of gross revenue.
- Govt. gets 30% of remaining revenue.
- Farmers will have exclusive first-rights of refusal in purchasing the land from the govt. after 10 yrs. (this gives govt. time to recoup investment, banks to earn landed family to adjust to managing with a lower margin, and time for poor farmers to build capital)
- All bids will be open bids to purchase parcels and the loans will be 40-yr. loans at discounted rates with 40% going to the govt. and 60% going to the landed family (both are then compensated for their stakes---especially the landed family).
- The continued production arrangement can be had by Farmer's re-leasing the land back to the govt. and landed family with the revenues split as follows---Farmer 45%, landed family earning 35% and govt. gets 10%. Why so low for govt.? Well, they're now out of the business and effectively privatizing the land ... at 10% that's still huge for doing nothing and no longer guaranteeing the capitalization.
- The capitalization/operating capital, etc. will be split 60% Farmer and 40% managing landed family again at longer time periods, say, revolving 3 yrs.
This should allow for a win-win for all: Govt, Family, Farmer, Private Sector (banks, etc.) and most importantly--everyone's incentivized while the system effectively redistributes wealth, capital, etc. amicably to all. In the end, the govt. is stronger, the country produces higher yield agri-products, the infrastructure is also maintained better, the landed families remain involved, compensated and have strong/competitive positions and, drum roll ... the farmers are no longer landless nor destitute, and they can never be brought back down to that level. In time the market forces will take over as more farmers are able to buy land and the "ownership" structure becomes more equitably spread---no one too big to swallow anyone else.
This is just a baseline, of course, and has holes just like other programs out there but it's conservative, equitable, manageable, and balanced for all parties. Hope you like it. . . .
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Me: All right, ladies and gentlemen, wala ba kayong mga kamay? Palakpak naman diyan! O, meron pa ba? Wala? O sige, ako muna. Here's what I have to say. . . .
I'd call it The Aquino Dilemma.
This is touchy. For one, we are here talking about a politician's morality, as per that part of the title of the essay: "moral high ground".
So, what is Noynoy Aquino's morality as regards the concept of agrarian reform and/or land reform? So far he has not spoken about it. Which could mean either of three things: 1) he has no stand on those issues, 2) his stand is so unpopular he dares not utter a word, at least not yet, or 3) his stand will hurt his family and he's not sure just yet how to wage war with them.
So what does he do now? He has resorted to the Gloria Arroyo tactic: lean on the law and the courts. From the eyes of lawyers and judges, this is fine, this is just right, this is flattering to them.
But from the eyes of a population expectant of a philosopher-king in Noynoy Aquino's person, resorting to the primacy of legalese may hurt his standing with his subjects. Unless, of course, he already knows what the courts are going to decide and what they'll tell him to do is precisely what he thought ought to be done in the first place. But in the meantime, Putzel may be right.
The issue right now is not really agraraian reform itself, is it? It seems that's the issue everyone wants to avoid. The issue is a non-issue in the media, it's a done deal, everyone has agreed that agrarian reform is the way to go. And maybe the nation is right.
But agrarian/land reform itself and its impact on the nation's agribusiness becoming the issue (rather than Noynoy Aquino being the issue), that's what I talked about in my last two blogs in Social/-Isms titled "Golf, a synechdoche of the land reform problematic" and "The Usual and the New". Is there really an economic model proving a measurable correlation between that reform and the nation's wealth? For we must remember that a progressive's standpoint is almost solely concerned with the farmer's liberation, rightly or wrongly putting this as primary, the sole goal over and above any agribusiness GDP performance considerations.
We might remember likewise that agrarian/land reform has its critics, with the relatively unbiased questions coming from the national economic planners. But maybe the progressives are right: maybe national economic planning can come afterwards, after land is redistributed. Maybe we can dismiss the case of Zimbabwe or Japan's rice industry's collapse and the US's healthy agri-industry owned by farming companies and France's recurrent subsidized-farmers problem.
Who is Noynoy Aquino on this issue? Is he an economic planner with a view on the subject? Is he a visionary who's keeping his visions to himself for now? Could he be a closet socialist? His father claimed to be a socialist. Well, while he remains quiet and allows the lawyers to interpret and implement the existing laws, he in the eyes of the people will truly dive down from being the Davidian or Solomonic philosopher-king, down to the level of being just another capitalist-statesman and pawn of corporate interests, liberal only in things that don't concern his companies.
This is the Aquino dilemma we sort of knew we'd come across. . . .
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Mac McCarty: Uhm, it's almost twelve noon, so, good morning/afternoon. Aren't you enjoying your lunch? Anyway ... my name's Mac, I'm a freelance editor and ... I'm also a preacher ... and a musician.
Gee guys, I was so hopeful that I could get by without commenting on this, the fish is great, the house wine, fine … but, wow, there just seems to be no way around it. First, I guess I’ll have to bite into Jo’s, this cafe's owner's, question (which he shares with the population in general) of just who Mr. Noy might be. Is he, for instance, the legislature—capable of writing land reform laws to promulgate throughout the land? Is he the Supreme Court, capable of arriving at some final decree that will settle once and for all the contrary claims of contentious (and opportunistic) leftist “agrarian organizations” versus self-interested big-time landowners? How will the court or the legislature react to his usurping the sacred role of either? Is he a Cojuangco, ruler of a dynasty of an agricultural corporation, able to dictate the fortunes and future of those holdings? Who is our esteemed president supposed to satisfy in this matter?
The sad fact is none of the players will be satisfied with any of the outcomes. If you were to confiscate every last hectare and asset of HLI, the leftists would still want to lead the landlords (preferably with ropes around their necks, dressed in sackcloth) through the streets for public shaming like is so popular in North Korea. And I doubt there will be a single Cojuangco (or any other sugar baron) who will be happy with any (even so complex a structure as the one PitPat proposes) divesture of what they see as “their land.”
But all that’s just politics. Let’s talk instead of farmers (as opposed to leftists committed to protracted armed struggle) and feeding people and the economic welfare of the nation. I am not personally a big fan of land reform. At least not as it has come into the political consciousness of this country in this time and place. We might do well to remember that CARP under Cory was the first land reform legislation to ever include sugar land. Personally, if sugar production (as a big and important export) is to play a large role in our economic future, I would much rather see all this radical energy go into contriving a very good, mutually profitable and smooth working stock option. Sugar just isn’t a smallholder crop. (Neither is wheat or corn for that matter—look around the world; are there any successful examples of any of these crops doing the smallholder any good?)
But more to the point, I come from a farm and ranch culture and I speak the language (however reluctantly). To start with, I have never known a farmer who worked himself to death against the vicissitudes of the land for any reason other than the hope that his children might be able to escape from farming into some kind of work where they might actually make some money.
In the second place, I have never known a “successful” farmer who wasn’t perpetually in debt. Every year they pay down the previous year’s debt and every year they borrow more to pay for doing what must be done to keep the farm or ranch productive. Most of the farmers I’ve known never have to pay taxes for exactly that reason. The banks are glad to go along with it because they get the interest, they know the farmer must make a go of it or die and, besides, the loan is against the land, which isn’t going away.
So what does a land reform beneficiary have to look forward to? The talk that gets talked is that a person who doesn’t own his own land is a “peasant.” That’s a very strong illusion (that the militant left is quite capable of exploiting) but it’s still an illusion. It’s so strong that it was the driving force behind “manifest destiny” that settled America with disgruntled Europeans who felt that, if they owned no land, they were nobodies. But this is the 21st century and we live in a world-wide market economy and, though food production (as PitPat points out) is of prime importance, there is every reason to doubt that the smallholder (as any land reform recipient is destined to be) is going to be the provider of that market.
The big objection to the stock option is that people sell their stock and end up with nothing. But the same thing happens when they get the land. Manny Villar didn’t build all those houses on land-grabbed land—a great deal of it came from smallholders who were just worn out from trying to make a go of it in a world that no longer fit the ideal of what a farmer is and what a farmer can do. These days, the answer to both the *is* and the *do* is, “not much.” So, stock or land, many people who have been sold the bill of goods that land reform is how they escape from being peasants will soon discover that they are now no longer peasants—they’re just ordinary poor people.
So you can see that to my mind all this stuff about Noynoy and land reform and so forth is pretty much beside the point. (And especially HLI, which isn’t even “big sugar” in the sense of, say, Negros—but is just a convenient way of beating up on the president to make sure the protracted struggle goes on … forever.)
PitPat, you have elucidated a very clear (though necessarily complex) plan, and for that I congratulate you. It might even work. It might be that the big landholders would be satisfied with something like just recompense and not give in to the temptation to game the system for all the illicit profits they could no doubt find leaking through the inevitable loopholes. And it might be that the radical left would be willing to give up the notion of protracted struggle in the interest of both the country and the farmers they claim to represent. Both these things are within the realm of possibility, but I have serious doubts. . . .
But PitPat, I must say that I’ve seen nothing but evil come from any sort of government land ownership. This unfortunate nation is yet to recover from the 1940s conversion to the Torrens system. In that conversion, the government assumed title to vast tracts of land—from which have come vast evils, including, but not limited to much of the “land grabbing” in Mindanao and even the massive Madrigal et al. title dispute that was a main factor in the eventual exile of Ninoy. In that sense, your proposal makes me very uncomfortable. Even if we were to have 6 or 12 or even 18 years of what passes for honest government, someone eventually is going to take a main chance “because I can.”
Lord, my arguments make it sound like you just can’t get there from here! I don’t believe that, but I hesitate to even make a counter-proposal. I do see a “beyond” in which food production plays a major role in the nation’s economy; where farming is not nearly so labor intensive as it is today; where the rural population is able to not only own a home, but can count on a job to lend them a modicum of human dignity; where the militant left (which, like the poor, will be always with us) will find few recruits for their professional depredations (because this is the true evil of the militant left: it starts as an almost holy calling but eventually becomes a profession); where the developmental focus moves away from the urban center and spreads throughout the countryside. . . . I see and believe in these things, but even under ideal circumstances, I fail to see how we might get there.
But I’m certain of one thing, whipping Noynoy with Luisita is no way to get there. If I put myself in Noy’s place, all I see is a nightmare. Congress and the Supreme Court are waiting with sharpened knives for his first incursion against their prized constitutional domains. His opponents (left and right) are gleeful that there’s nothing much he actually can do one way or another—thus enabling them to prove beyond a doubt that he’s weak and ineffectual (without ever having to define what a “strong and effectual” leader might actually do in his place).
In the meantime, “why doesn’t Noy get his relatives with the program?” is the question on enlightened lips. But the truth of the matter is that he can’t—because if he fails, they win! So this is to me the supreme irony: the best we can do to overcome the oligarchy is to support Noy! That’s so weird! But in fact, that’s the same reason we supported him during the election.
