This two-part investigative report revisits the site of what is still regarded as the country’s worst mining disaster, along with two other towns that had been most affected by the activities of the Marcopper Mining Corporation. The series details the health hazards posed by the abandoned mine wastes, and notes the lack of health personnel who could respond to the rising health needs of the affected communities. Already, medical experts have observed an increase in cases of diabetes, goiter, renal disease, spontaneous abortion, and even cancer in at least three towns in Marinduque.

With the Arroyo government’s aggressive marketing of the Philippines as a mining country, many fear that the Marinduque experience may serve as a standard in dealing with future mining disasters — with no one behind bars, the mess left behind, and the community virtually abandoned to fend on its own.

Read on at pcij.org.

But there’s the rub: Mining materials like gold, iron ore, copper, and even the lowly coal necessitates the clearing of vast tracts of land, disturbing habitats of local fauna, and boring through and often slicing up mountains. Unfortunately, too, poisonous substances are sometimes brought up along with the coveted materials, which are also semi-processed on site with harmful chemicals. Its critics thus say that even barring accidents, the mining industry is literally a dirty business, if not a disastrous one (except, perhaps, in terms of profit).

Mining, however, seems to be a necessary evil. After all, although rappers and Paris Hilton can keep breathing even if they had less bling on their bodies, a wide variety of metals are still needed for the construction of buildings, homes, and vehicles, among other things. Even PCs and cell phones and whatever latest gadget we have decided that we can no longer do without have more than one mined component. For sure, activists have begun arguing that there are enough metals (and gems) above ground that can be recycled, hence reducing the need to mine for these. Yet aside from the recent attempts of some unscrupulous individuals to smuggle tons of Philippine coins to China and South Korea (where they presumably would be melted and their copper and nickel content extracted for something else), there are hardly any signs of anyone heeding that call.

In the meantime, proponents of mining insist its drawbacks can be reduced and that companies and governments are now starting to apply the lessons learned from previous disasters. Here in the Philippines, environment officials say earlier mishaps, especially the 1996 Marcopper mining disaster in Marinduque, have led to more stringent implementing rules and regulations for the controversial 1995 Mining Act that provides a slew of generous incentives for foreign investors. Already, a couple of cyanide spills at the copper, zinc, and gold mining site of an Australian firm in Albay in 2006 saw the government closing the company’s operations there for more than a year and slapping it with hefty fines. Obviously, though, the better scenario would have been no spills at all.

It’s such a rich and complex subject matter that i Report will be devoting the next two months to it. We start by revisiting the towns that bore the brunt of Marcopper’s mining activities in Marinduque. We will also look at older mining communities, as well as scrutinize new ventures, both big and small. We may even go overseas to see how some of the Canadian and Australian mining companies that operate here behave elsewhere.

There is much to explore, so dig in.

Is There a Storm on the Horizon?
Joel Rocamora, October 31, 2008

The bishops did it. Their call for a “new government,” then building hope around “liberators” who are “just around the corner” got everyone worked up. A “new government” in advance of the 2010 elections, of course, means the extra constitutional removal of the Arroyo administration. Everyone assumes the bishops are not talking of the Second Coming. Maybe those knights in shining armor who are a long time coming.

Conspiracy theorists are having a field day. The impeachment initiative, cha-cha (charter change), and the arrival of Jocjoc Bolante primed the public for the bishops’ statement. Are these moves linked? Is there a master conspiracy behind these linked moves? Did the bishops light the fuse for a coming explosion? Is it a short or a long fuse? The nice thing about conspiracy theories is that we can enjoy dramatic tension even if we cannot find out if there’s anything to the theory.

Whether or not the bishops are, consciously or unconsciously, part of a conspiracy, what they’ve done is important because it reminds us that moral outrage does not recognize the political calendar. Practical politicians on both sides of the pro-anti-Gloria (Macapagal-Arroyo) divide say talk of liberation have to make way for preparations for the 2010 election, only a year and a half away. The moral sensibility asks why we have to wait. If we can, let’s get rid of her now.

Which bishops set the impact.  Archbishop Oscar Cruz, the constant warrior, tilting endlessly against jueteng. Archbishop Angel Lagdameo, president of the CBCP, perennially frustrated by the CBCP’s conservative majority. Bishop Socrates Villegas is bishop of Balanga-Bataan, but he is well known to Manila reform circles from serving as the late Cardinal Sin’s able assistant. Two others signed the statement, Masbate Bishop Joel Baylon, and Legazpi Bishop Emeritus Jose Sorra.

Who was not with them might also be revealing. The bishops of KME (Kilusang Makabansang Ekonomiya) who were not there have in the past been accused of supporting coup attempts. If the KME bishops have been the more public of the Catholic Church’s progressive section, the AMRSP (Association of Major Religious Superiors of the Philippines) has more resources. AMRSP sisters have been Jun Lozada’s bodyguards for most of the last eight months. The bishops’ initiative was apparently at the behest of the AMRSP.

Whether intentional or not, the bishops also weighed in on the 2010 elections.  Two presidential contenders, Vice President (Noli) De Castro and Senate President (Manuel) Villar, are clearly not in the bishops’ support list. The two leaders they prefer, Chief Justice (Reynato) Puno and AFP Chief-of-Staff (Alexander) Yano, are not running for elective office, but could come in as leaders of an extra-constitutional post-GMA (Gloria Macapagal-Arroyo) leadership.

On its own, the bishops’ initiative is not likely to result in the kind of change they hope for. But it does raise the incendiary potential of other ongoing developments. Bolante’s return has been avidly anticipated. His attempt to avoid having to talk, resulting in two years of imprisonment in the U.S., indicates the explosive potential of his telling the truth. But early indications are that he’s not going to talk.

There’s an apparently coordinated effort to prevent his testimony in the Senate. Even before he returned, his lawyer petitioned the Supreme Court to prevent the Senate from reopening hearings on the fertilizer scam, arguing that the investigation is finished. This argument is backed up by administration allies in the Senate led by Sen. (Edgardo) Angara who says that the Senate long ago submitted its recommendation to the Ombudsman for Jocjoc’s prosecution. For two years, the Ombudsman did nothing, acting only on the day after Jocjoc returned.

The positioning of administration lackeys in the Senate is understandable. What needs explaining is the hesitation of Senate President Villar who only moved to have Jocjoc arrested by the Senate the moment he arrived after LP (Liberal Party) senators threatened to attack him. Villar is also problematizing what committee would investigate. Since the Committee on Agriculture is headed by Sen. Angara, the only logical committee is the Blue Ribbon Committee headed by Villar party mate Senator Alan Peter Cayetano. Senator Mar Roxas has proposed that the Senate convene as a committee of the whole.

Maybe this is where the explanation for Villar’s hesitation lies. He does not want to give Mar Roxas a platform. Villar supporters might also be worried that a Bolante expose would put some life into the impeachment complaint. In the unlikely possibility that GMA does get impeached, it would greatly strengthen the position of another Villar competitor, Vice President De Castro, who would become president. A combination of administration senators and Villar allies, together with the more than one week lapse before the Senate reconvenes could defuse the Bolante issue, even if the Supreme Court refuses to act on Bolante’s petition.

The competing political calculations of 2010 election coalitions are also likely to determine the fate of the impeachment complaint. The minority in the House has not, so far, endorsed the complaint. While there is no such thing as impossible in the shifting coalitions of Philippine politics, the complaint is not likely to get the one-third of House members needed to move the complaint to the Senate. If its proponents succeed in at least debating the substance of the complaint, that will, under current circumstances, already be a victory.

The administration’s move to advance its cha-cha agenda is potentially more explosive. The attempt, whether it succeeds or not, is proof of opposition suspicions that GMA intends to stay in power beyond the end of her term in 2010. Led by House Speaker (Prospero) Nograles, the administration is mobilizing to secure charter change without involving the Senate. Quite openly, administration stalwarts are saying that if they can get three-fourths of the members of both the House and the Senate, they can pass constitutional amendments.

For now, the amendment would only remove the prohibition on foreign ownership of land. If  Nograles succeeds in getting the 196 votes of House members he needs, the issue will then be raised to the Supreme Court. If GMA allies in the SC affirm the constitutionality of this mode of amending the constitution, there will then be no legal obstacle for GMA and her allies to make the kinds of changes that would keep GMA in power past 2010. The conditions for maximum polarization will then have been set.

These kinds of conditions should facilitate the revival of the mass movement. Whether they like it or not, the anti-GMA opposition will be forced to reunite as the likelihood of 2010 elections recedes. It will also force leaders of key political institutions, in particular the SC and more importantly, the AFP, to decide whether their allegiance to the Constitution  extends past its being mangled. If the Chief-of-Staff decides he has no obligation to obey a mangled Constitution, the door will be opened for “liberators.” It could then be “a walk in the park.”

This is because, no thanks to the Office of the Ombudsman, no case has yet to be filed against Bolante two and a half years after a Senate investigation found him to have masterminded the P728-million fertilizer fund scam, allegedly diverting the amount to Gloria Macapagal-Arroyo’s presidential campaign in 2004.

Citing this reason, Justice Secretary Raul Gonzalez already declared last week that Bolante, a close confidante of First Gentleman Jose Miguel Arroyo, is a “free man” as he won’t be facing arrest upon his return.

Only the Senate, through its sergeant-at-arms, is left to effect an arrest, although there are contentions being raised whether the warrant it issued against the former agriculture undersecretary on December 12, 2005 for refusing to appear before its hearings remains enforceable to this day. Bolante’s lawyer has in fact elevated the matter before the Supreme Court.

Insisting on its validity, Senate President Manuel Villar has recently instructed Gen. Jose Balajadia Jr., the upper chamber’s sergeant-at-arms, to implement the arrest order in anticipation of Bolante’s arrival tomorrow.

Lawyer Harry Roque, who had worked in the sidelines for Bolante’s deportation, maintains as well that the order of arrest was for contempt of the Senate as an institution and not pursuant to an arrest warrant issued by a judge.

“It matters not thus that the personalities that signed the order of arrest are no longer in the Senate,” said Roque. “It was the institution that was aggrieved and this fact alone should be a legal reason for the Senate’s Sergeant-at-Arms to proceed to arrest Bolante and to bring him to the Senate for the purpose of compelling him to testify in what the Senate has described as an ‘unfinished investigation’ until Bolante, the ‘architect of the scam,’ could be heard.”

Arrest or no arrest, Bolante, now that he is coming home, should however be made to answer the damning accusations against him in the report of the Senate Blue Ribbon Committee and Committee on Agriculture on the fertilizer fund scam.

Read the Senate report here.

As a review, below are the main findings in the Senate’s 41-page report to illustrate why Bolante is the Senate’s “most wanted” man:

Ten Reasons Why the Fertilizer Issue is a Scam

• First, the Farm Inputs and Implements Program was non-existent. Nobody in the Department of Agriculture was aware of its existence. Not a single document in the files of the DA supported its existence.

• Second, the fertilizer fund was a single appropriation meant only for 2004. Its implementation in 2004 during the months of the election season is an indication of its intended purpose and illicit objective.

• Third, the design and implementation of the fertilizer fund scam manifested the height of scandalous corruption — gross overpricing of fertilizers range from almost 700 to 1,250 percent. Towable shredders and chippers were overpriced by as much as 331 percent while small shredders and chippers, by 206 percent.

• Fourth, the fertilizer fund was released in the months of February to May, the traditional harvest season in the country when fertilizers are not in use. The planting season begins only in November.

• Fifth, the fertilizer fund scam is haunted by ghost and questionable suppliers and deliveries. For instance, the registered business address of AKAME Marketing, the identified supplier of a substantial number of transactions in the P728-million fertilizer fund, could not be located. There were no documents to prove that Castle Rock Construction, which was awarded with multiple contracts, can engage or do business related to the trading of fertilizers. FESHAN Philippines, Inc., one of the largest suppliers, was originally a medical supplier that started to supply fertilizer only in 2004, its office address also non-existent.

• Sixth, there was gross disproportion between what was needed by the farmers and wasteful utilization of the farmers’ fund as shown by a document identifying the fertilizer requirements for 2003 submitted by Frisco Malabanan, GMA Rice Program director. The amount needed was only P28.613 million for the entire country compared to P2.806 billion released for 2004.

• Seventh, liquid foliar fertilizer, which is appropriate for ornamental plants, was supplied. Rice requires solid fertilizers which include urea, ammonium sulfate, ammophos, complete fertilizers, and muriate of potash, depending on the situation of the soil.

• Eighth, there was “double corruption” in that the wrong and overpriced kind of fertilizer for rice was even diluted with water.

• Ninth, Bolante cunningly, wittingly listed 105 congressmen, 53 governors and 23 mayors to justify the immediately release of the fund, specifying uniform amounts, regardless of which congressional districts or local government units the proponents represent, whether these were rice or corn-producing LGUs or not. Bolante even listed proponents from Metro Manila where farms are non-existent.

• Tenth, Bolante made the list attractive by including a number of politicians as proponents. In truth, however, their names were just used to lend credence to the project.

Recommendations

Having established strong probable criminal culpability, the Senate committees recommended the filing of criminal and administrative charges against the following DA officials:

• Bolante
• Secretary Luis Lorenzo
• Undersecretary Ibarra Poliquit
• Undersecretary Belinda Gonzales
• Assistant Secretary Jose Felix Montes

All five top officials, as well as all DA regional directors who “participated in the illegal transactions or dissipation of the P728-million fertilizer fund scam,” were recommended charged with violations of the Plunder Law and the Anti-Graft and Corrupt Practices Act.

It was also recommended that Gloria Macapagal-Arroyo be held accountable for the “mismanagement of the fertilizer fund.” The report further said:

It bears knowing that a number of testimonies adduced during the hearings were that the fund was indeed used to assure her victory in the 2004 elections. Statements of lawyer Francisco Chavez, the various farmer organizations led by the Kilusang Magbubukid ng Pilipinas, and the positive declaration of Secretary Emilia Boncodin that the President may have knowledge on the Bolante requests for fertilizer funds stand and remain uncontested in the legislative records.

Cognizant of the presidential immunity and respect accorded to the Chief Executive, the accusations against her in the fertilizer fund scam is (sic) so serious that it places (sic) the position of the Presidency in the balance. The Palace looks at the issue as a mere political tool. Its refusal to cooperate violates the spirit of democracy, promotes tyranny and breeds the ground for instability it has in fact stirred. Failure to disprove the charges, even resorting to shield those directly responsible for squandering taxpayers’ money, suggest her culpability and involvement in this unforgivable act made against our poor farmers. Her obvious indifference to examine the matter further and identify the irregularities surrounding the disbursement of the farmers’ fund is equivalent to breach of official duty by nonfeasance and inexcusable negligence of sworn obligation. In sum, the same may be labeled as betrayal of public trust in addition to the violations committed under the Anti-Graft and Corrupt Practices Act and the Law on Plunder.

In the fertilizer fund scam, Undersecretary Bolante is the declared architect. He designed it. He was its brains. It was he who worked with the DBM for the immediate release of the fund. It was him who prepared and submitted names who would become the fertilizer fund’s proponents. It was Undersecretary Bolante who sent letters to various congressmen and local officials informing them of the availability of funds under the DA’s GMA Project. It was him who directed these officials to coordinate with his office to discuss all the requirements to facilitate the said project fund.

Undersecretary Bolante in the words of his then Chief of Staff, Ibarra Poliquit, had a hand in determining how the GMA Project fund works and will be spent. And that although the DA has a list of officials whose proposed projects” were to be funded by the fertilizer fund, Bolante was given the authority to drop them and replace them with others.

Now, PNP Director General Jesus Versoza is claiming that the said amount was sourced from the PNP’s intelligence funds meant for the purchase of equipment for its intelligence operations.

The new justification was contained in the PNP chief’s letter last Friday to the Senate foreign relations committee chaired by Senator Miriam Defensor-Santiago that is conducting an inquiry into the scandal. Versoza even requested for an executive session at the Senate’s next hearing so he can discuss the matter with the senators.

Yet at the Senate hearing a day earlier, Versoza could not even answer where the money specifically came from. The PNP chief told the senators that he only learned of dela Paz’s cash advance from Senior Superintendent Tomas Rentoy III, budget division chief of the PNP Directorate for Comptrollership.

Under oath, Versoza also said he did not sign a voucher to release the fund. Neither was he in the know as to which of the PNP’s bank accounts the money was withdrawn.

Switching to another storyline on the dela Paz caper, Versoza has however only lined himself and the other PNP officials up for more violations of laws and government rules and regulations than what they already have committed. As already pointed out by Senators Santiago and Mar Roxas II, the Russia trip of the eight PNP senior officials was in wanton disregard of the following rules governing official travel and the disbursement of public funds:

• Administrative Order No. 103, issued by Gloria Macapagal-Arroyo on August 31, 2004, which directs the continued adoption of austerity measures in the government by calling for the suspension of “(a)ll foreign travels, except for (i) ministerial meetings, and (ii) scholarship/trainings that are grant-funded or undertaken at no cost to the government;”

• Executive Order No. 298, issued by Arroyo on March 23, 2004, fixing the rates of allowances for official local and foreign travel of government personnel according to the United National Development Program (UNDP) Index. (The daily subsistence allowance of the PNP delegation was reportedly $467 per member, more than double the stipulated amount of $229.)

• 2008 General Appropriations Act, Section 16 (c) of which prohibits the use of government funds to “defray foreign travel expenses of any government official or employee, except in the case of training seminar or conference abroad when the officials and other personnel of the foreign mission cannot effectively represent the country therein, and travels necessitated by international commitments: PROVIDED, That no official or employee, including uniformed personnel of the Department of Interior and Local Government and Department of National Defense, will be sent to foreign training, conference or attend international commitments when they are due to retire within one year after the said foreign travel.” (Dela Paz retired last October 9 while five of the seven PNP officials are 55 years old, one year shy of the PNP’s retirement age of 56.)

Instead of clearing up the controversy surrounding dela Paz’s undeclared currency, Versoza’s claim has in fact only raised even more serious questions. For one, the 2008 GAA prohibits the release or disbursement of confidential and intelligence funds in the budgets of departments, bureaus, offices or agencies of the national government unless approved by the President.

Former budget secretary Emilia Boncodin also points out that the purchase of equipment is never taken from the intelligence funds of a government agency. What can be charged to the fund, she says, are maintenance and other operating expenses (MOOE), not capital outlay. In fact, in the PNP’s 2008 budget, intelligence funds totaling P434.3 million are provided for the conduct of intelligence and counter-intelligence activities, and not for equipment.

Boncodin adds that there is nothing in the law that exempts the purchase of intelligence equipment from the government procurement process.

Regardless of the source of funds, whether local or foreign, the procurement of infrastructure projects, goods and consulting services by all branches and instrumentalities of government, its departments, offices and agencies, including government-owned and/or-controlled corporations and local government units shall be covered by the Government Procurement Reform Act, or Republic Act No. 9184.

The GPRA mandates that all government procurement shall be done through open bidding. Government agencies may however resort to alternative methods of procurement as limited source bidding, direct contracting (or single source procurement), repeat order, shopping, or negotiated bidding whenever justified by the conditions provided in the GPRA.

Arroyo’s own directive, AO 103, even lists as part of government’s austerity measures the strict compliance with the GPRA and its implementing rules and regulations in the procurement of goods and services, “particularly in the use of the Government Electronic Procurement System for public bidding, advertisement of opportunities and reporting of bid awards results.”

Based on how Versoza described it, the purchase of intelligence equipment could likely be classified under the shopping mode, which involves directly procuring from suppliers of known qualification of readily available off-the-shelf intelligence equipment. It is not known though if the PNP made prior requests for the submission of price quotations for such equipment. Besides, shopping may only be resorted to for purchases not exceeding P50,000.

Boncodin also says dela Paz cannot bring with him such a huge amount since government transactions are not done in cash. While cash payment is allowed for purchases involving lower amounts, it is not the practice for huge amounts as in dela Paz’s case. “That’s unheard of,” says Boncodin.

Indeed, as a matter of practice, cash transactions are not allowed in government procurement, concurs Professor Leonor Magtolis Briones of the University of the Philippines National College of Public Administration and Governance (NCPAG).  “For purchases involving more than P10,000, a check is issued,” the former national treasurer explains.

Briones wonders why as PNP comptroller, who is the guardian of his agency’s finances and who should be doing internal audits of its funds on a daily basis, dela Paz did not seem to know the rules. Such, she says, is a reflection of the “very weak” internal control system at the PNP.

Why the agency is now singing a different tune, Briones suspects, may have to do with the wrong notion that intelligence funds are not subject to scrutiny, and hence outside the purview of the Commission on Audit (COA).

She says the PNP has to be disabused of this idea that has resulted in the accountability for intelligence funds being “very much abused.”

“Intelligence funds are still subject to audit, but only by the COA chairman,” says Briones, who once served as secretary of the state auditing firm.

Whether an audit is done or not, or if the COA chairman’s findings and recommendations are seriously implemented, she adds, is another matter.

Charged before the Tacurong City Regional Trial Court in Sultan Kudarat close to noon today were Department of Agriculture Region XII finance officer Osmeña Montañer and accountant Estrella Sabay.

The case against Montañer and Sabay, docketed as Criminal Case No. 3064, was filed at the Tacurong RTC Branch 20 of Judge Melanio S. Guerrero.

Montañer and Sabay were tagged as the masterminds in Esperat’s murder by one of the accused who turned state witness, Rowie Barua.

In his July 4, 2005 testimony before Judge Eric Menchavez of the Cebu City RTC Branch 21, Barua, an ex-military intelligence officer who admitted his participation as coordinator, narrated, in detail, how he was asked by Montañer and Sabay to plan and undertake the killing of Esperat — a period of more than two months from the planning stages in early 2005, to the point of hiring ex-Sgt. Estanislao Bismanos, Gerry Cabayag and Randy Grecia to “silence” the journalist, up to the time of payment for the hatchet job.

On October 6, 2006, Judge Menchavez handed down the guilty verdict on Bismanos, Cabayag, the confessed triggerman, and Grecia for the gruesome murder qualified by treachery. The three were meted the penalty of reclusion perpetua. Barua was acquitted, while the verdict on the two alleged masterminds were deferred pending the Court of Appeals ruling on their certiorari petition.

On May 14, 2008, the Cebu City Court of Appeals issued a writ of preliminary injunction prohibiting the Cebu City RTC from proceeding with the case against Montañer and Sabay. The appellate court also stopped the implementation of the February 4, 2008 warrants of arrest against them.

With the filing of the case in Tacurong, Nena Santos, private counsel for the prosecution, told the Center for Media Freedom and Responsibility (CMFR) there is a big possibility that the court would issue warrants of arrest against the two by Wednesday, October 22. “If not, the Department of Justice (state prosecutors) will file a motion for the issuance of a warrant of arrest,” Santos said.

Esperat, a columnist for the Sultan Kudarat paper The Midland Review, was gunned down on March 24, 2005 while having dinner with her children in her home in Tacurong City. She wrote exposés and filed cases with the Office of the Ombudsman in connection with the corruption inside the DA regional office, particularly the multi-million peso fertilizer funds scam, which not only allegedly involves the two suspected slay masterminds but also several high-ranking national officials.

By CMFR’s tally, 75 journalists have been killed in the line of duty in the Philippines since 1986. Apart from the Esperat case, only one other case has seen the successful conviction of journalists’ assassins and their accomplices since 2001 — the murder of Edgar Damalerio which led to the conviction of former police officer Guillermo Wapile in November 2005 who was meted the penalty of life imprisonment.

No mastermind, however, has yet to be successfully prosecuted.

The limited understanding, however, and therefore, the lack of policies to regulate this kind of technology pose a huge impact on the economy and potential risks to health and the environment, said Pat Roy Mooney, executive director of Canada-based Action Group on Erosion, Technology, and Concentration (ETC Group).

At a briefing last week, Mooney, who authored and co-authored several books on the politics of biotechnology and biodiversity, warned that some of the food and cosmetic products that Filipinos consume may contain nano-scale particles that could be harmful to human health.

According to ETC Group, over 800 products in the country have been processed under nanotechnology.

“These products are in the marketplace now and they are not regulated by the Philippine government or anybody else’s government,” Mooney said. But the lack of regulation is unlike the case of the melamine scandal.

“The basic reality (in nanotechnology) is that governments have never recognized this question of size,” he added.

‘Tiny’ technology

If biotechnology deals with the manipulation of life (bios), nanotechnology speaks solely of scale. A nanometer is equal to one billionth of a meter. One human hair is about 80,000 nanometers thick. Everything at the nano-scale is invisible to the unaided eye and even to all but the most powerful microscopes.

Below 100 nanometers, a material’s properties can change dramatically. “You go out of the area of classical chemistry and come into the field of quantum effects,” Mooney explained. “All of the characteristics of a chemical change below 100 nanometers, as you drop down in size — 100, 75, 50, 25 nanometers, and so on — keep on changing.”

With only a reduction in size and no change in substance, materials can exhibit new properties such as electrical conductivity, elasticity, different color, greater strength, and greater reactivity — characteristics that the very same materials do not exhibit at the micro or macro scales.

For example, aluminum oxide, the material used by dentists in teeth, is perfectly benign, but at the nano-scale — once ‘quantum effects’ kick in — the same substance is explosive and is used by the United States Air Force to set off bombs.

Nanomaterials, which are far lighter and stronger than anything currently used, could revolutionize the way things are made. Mooney said: “(Nanotechnology) cuts across the entire economy. It’s in cars, soap, food, pesticide, drugs, computers, because everything is made up of atoms.”

Download ETC Group’s “A Tiny Primer on Nano-scale Technologies.”

Potential health risks

Specific risks to human health of nanoproducts have yet to be identified. ETC Group’s Mooney, however, noted that out of 26 peer review studies conducted, none of these suggest that nanoparticles are entirely safe. “All of them say that further studies are needed.”

He explained that at around 70 nanometers in size, a nanoparticle can get into the lungs, skin, and cells. Then at 50 nanometers, it can go deeply into the body’s organs. At 30 nanometers, the immune system will not be able to detect a nanoparticle at all. “It’s too small for the immune system, which means that a nanoparticle can pass through the placenta.”

In the Philippines as in other countries, products containing nano-scale ingredients cannot be identified because these are not labelled and require no regulatory oversight.

Products suspected to contain nano-scale ingredients range from canola oil, health supplements, weight loss pills, cosmetic and anti-ageing products to textile, electronic products, and computer and automotive parts.

Southeast Asia Regional Initiatives for Community Empowerment (SEARICE) executive director Wilhelmina Pelegrina urged the government to impose a moratorium on nanotech research and the commercial distribution of products until laboratory protocols and regulatory regimes are in place to protect workers and consumers, and until these materials are shown to be safe.

The problem, however, said Mooney, is that the technology is so advanced that governments have yet to figure out and understand it.

Meantime, he suggested consumers to check out the website of the Woodrow Wilson International Center for Scholars, which has an inventory of nanotechnology-based consumer products currently on the market. While not comprehensive, the inventory provides a look at over 800 manufacturer-identified nanotechnology-based consumer products currently available.

Economic impact

The concept of commodity or raw materials is also changing with nanotechnology.

Mooney explained that an economy like the Philippines, which exports gold, nickel, and food products, could be affected if the role of raw materials changes in the future. “We don’t know if we will need gold or nickel the same way we had in the past.”

As an example, Mooney said that chalk, a very simple compound, once brought down to the nano-scale, can be 100 times stronger than steel and six times lighter. “In the end, there will be no need to make steel. You can actually use chalk, incredibly cheap at the nano-scale.”

The same thing may also apply in food products wherein requirements for commodities like coffee, tea, cocoa and sugar can be reduced. In nanotechnology, the same taste can be maintained but using much less of the raw material. This could entail the demand for fresh production to drop considerably.

Nanotechnology, ETC Group said, has the potential to topple commodity markets, disrupt trade and the livelihood of the poorest and most vulnerable workers who do not have the economic flexibility to respond to sudden demands for new skills or different raw materials.

“We are not against technology advancement, but the developing economies are ill-prepared,” said Peregrina.

ETC Group and SEARICE, along with other international civil society groups, proposed the creation of a new United Nations body to track, evaluate, and accept or reject new technologies and their products though the International Convention on the Evaluation of New Technologies (ICENT). ICENT is designed to provide an early warning or early listening system capable of monitoring any significant new technology.

The government’s appropriations program in the year preceding an election has always been deemed an election year budget. It is the time when incumbent public officials get to maximize the use of state resources to promote themselves through infomercials, provincial sorties and other activities that would make them visible to the public.

In a bid to keep in check the administration’s spending priorities and to guard against possible misuse of the national government budget, an advocacy group called the Alternative Budget Initiative, a consortium of 56 NGOs and civil-society organizations, has combed President Gloria Macapagal-Arroyo’s request to Congress for a P1.415-trillion expenditure program for 2009 and found “overly optimistic” macroeconomic assumptions and “unattainable” growth projections in this time of economic crunch.

No place for frivolous spending?

The ABI also found a whopping P790.644 billion for “special purpose funds,” or 56 percent of the P1.415-trillion budget, and only 44 percent or P624.355 billion will go to departments and agencies. This, the group avers, is clearly inconsistent with Mrs. Arroyo’s assertion in her budget message to Congress that “with performance-based budgeting put in place, the public is assured that frivolous spending has no place in this Administration.”

“The SPF contains some lump-sum appropriations which are highly discretionary, often within the direct control of the President, with either vague or no special provisions making it prone to frivolous utilization,” the ABI noted in its report entitled, “Alternative Budget 2009: Securing Financing for MDGs Amidst Economic Challenges.”

MDGs refer to the Millennium Development Goals that the Philippines has committed to attain by 2015 under the auspices of the United Nations. These goals are focused on improvements in the delivery of basic social services such as education, health, environment and agriculture to lift millions of poor people from poverty.

In the 2009 budget, the special purpose fund increased by P96 billion from this year’s allotment while the allocation for departments and agencies rose by P92 billion.

In addition, Malacañang’s budget request contains billions of pesos for monetary support like power subsidies and cash assistance to purportedly ease the burden of rising costs of food and fuel on poor families.

Earlier this year, the Arroyo administration extended P500-cash subsidy to small power consumers which cost the government P2 billion. The ABI asserts this had no legal cover as it was not authorized under the 2008 General Appropriations Act.

The ABI, organized by Social Watch Philippines, presented its alternative budget for 2009 to Congress last September 30. It basically advocates for funding priorities in the areas of education, health, agriculture and the environment.

Tarlac Rep. Junie Cua, who took over the chairmanship of the House appropriations committee from Albay Rep. Edcel Lagman in August, said the Department of Agriculture budget (39.7 billion) includes “assistance packages “to address the problems of food security.”

These packages consist of fertilizer assistance; irrigation and other infrastructure facilities; extension and education loans for inputs; loans for shallow tube wells; surface water pumps; dryers; and seed subsidies.

Early into the years of the Arroyo presidency, there were lingering suspicions and allegations that lump-sum funds in the DA ended up into the campaign kitties of favored candidates of the administration in the 2004 elections. And who has not heard about the P729-million fertilizer scam and Jocelyn ‘Joc-Joc’ Bolante?

‘Life vests’ and ‘parachutes’ for the poor

On the eve of the approval on second reading of the 2009 proposed budget by the House of Representatives on October 11, a handful of ABI members dramatized their lobbying to legislators for the adoption of the alternative budget by wearing orange shirts and holding orange umbrellas. These, they said, were symbols of protection for millions of poor Filipinos that additional funding for education, health, agriculture and environment seeks to benefit.

Asked about the chances of having the ABI proposal considered in the amendments to the General Appropriations Bill before it is taken up in plenary for third-reading approval next month, Speaker Prospero Nograles said: “We’ll see.”

The House leader admitted that he has not gone through the ABI proposal, but said that for as long as it advocates more spending for health, education and food production, then it would be given priority. “That’s my line, that’s nearest to my heart,” he assures. “I want the budget to be crafted in that direction…to have some kind of a shock absorber for the marginalized, let’s put up the economic life vests and parachutes for the marginalized.”

But then, Nograles explains he is merely a “receiver” of proposals and a “referee” in Congress, and passes the proposals on to the appropriate committees, such as the appropriations committee in the case of modifications in the budget request of Malacañang.  “I am just a referee here…but I support that line (of spending increases for education, health and other social services.)”

While the P1.415-trillion budget proposal hurdled the House after two weeks of marathon sessions that ended at dawn on October 11, it appears that it won’t have as much easy sailing in the Senate.

Financial tsunami

The ABI seems to have found a strong ally in Senator Manuel A. Roxas III, who is calling for an overhaul of the budget proposal to address problems arising from what he termed as a “financial tsunami” that hit the United States and other Western markets and would surely have adverse impact on the Philippines.

“It’s very clear that we are now facing a very different situation. Since the House has already approved the budget, it’s up to the Senate to do the changes,” the Wharton-educated legislator points out.

This is the third year of organized citizen participation in the budget process, an advocacy that some members of the Senate and the House of Representatives have embraced.

“We challenge Congress to scrutinize the executive budget and adjust it to account for the emerging worse scenarios for the rest of the year and for 2009,” says Leonor Magtolis-Briones, lead convenor of Social Watch Philippines and a professor at the UP National College of Public Administration.

“This entails prioritizing essential social programs that will protect the poor, and spur the domestic economy, which are what the civil society’s alternative budget proposal enshrines,” adds Briones, the national treasurer under the presidency of Joseph Estrada.

The ABI proposes additional funding of P42.997 billion for basic and higher education, health, agriculture and environment.

The biggest increase of P18.697 billion is recommended for basic education, largely for  teachers’ salaries and other benefits. The next biggest beneficiary of budget increase, as proposed by the ABI, is the palay procurement program of the National Food Authority, to be doubled to P31.45 billion to buy 1.85 million metric tons of palay, or an equivalent of 10 percent of the projected harvest in 2009, at P17 per kilo.

Along this line, Roxas agrees that the 2009 budget should provide for basic goods and services for the poor, such as food, education and support programs for businesses to help them weather the financial storm.

The ABI has identified P65.7 billion in Special Purpose Funds and P17.15 billion from different government agencies as possible sources of the additional funds it is seeking to provide more financing for education, health, agriculture and environment.

Mass layoffs, reduced income from abroad

The country, Roxas says, has to brace for the possibility of mass layoffs among Filipino workers overseas, reduced dollar remittances, lower demand for Philippine goods abroad and lower incomes for Filipino families.

“This will have a huge effect here, in the coming months. But the government can still avoid the worst effects of this. We have to act now,” the senator asserts.

“First of all, we have to make sure Filipinos are fed. This can be done by providing assistance to farmers so they can harvest enough for the needs of the country, and we no longer need to import from abroad,” he says.

Roxas earlier urged President Arroyo to convene a multi-party budget summit to take up the global financial crisis and its impact on the Philippines, using the proposed 2009 national budget as a tool to shield Filipinos from its direct effects.

“If we don’t change the 2009 budget, Filipinos will surely face more hardships next year,” he warns.

Nograles, however, says the budget program that the House approved was already “a very flexible, reform-oriented budget, and a recession-responsive policy action that our people can depend on, an antidote to economic stagnation.”

What was actually approved at the House was basically what Malacañang submitted last August 26. Congressmen were given until October 14 to submit their proposed amendments to the GAB.

The spending program, as approved by the House, was based on a gross domestic product (GDP) growth projection of 6.1 to 7.1 percent even as international ratings agencies and financial institutions forecast a low of 4.4 percent ((HSBC) to a high of 6.1 percent (World Bank and Moody’s).

Source: Prof. Benjamin Diokno’s presentation in a Budget Forum, 9 Sept. 2008, UP NCPAG

The government’s inflation target for next year is still at six to eight percent, yet as of last month, the Bangko Sentral website shows the inflation rate at 11.9 percent. The exchange rate, which is now hovering at P47 to the US dollar is pegged at P42 to P45 next year while the Dubai crude is assumed at $150 per barrel when it has already gone down to less than $80 per barrel.

Worse than last year

The ABI notes in its “alternative budget” proposal that while the government had already scaled down growth assumptions for 2008 and 2009, the figures remain “too optimistic” in view of recent trends in the domestic and international economy.

“The latest statistics only confirms what the people already feel and perceive all along. General economic performance has been worse than last year’s as higher food and fuel prices and general decline in the world economy takes its toll,” it adds.

Thus, the ABI hopes that its own “alternative budget” will be seriously considered in the amendments “to protect the poor from the economic slowdown.”

The House is scheduled to vote on the budget bill on third and final reading when Congress resumes sessions on November 10.

The period of amendments is probably the most crucial part of the budget process at the House of Representatives because it is in this phase when the so-called “congressional insertions” or realignment of funds to the legislators’ pet projects take place.

However, the bicameral conference committee composed of a select group of senators and congressmen has the last say on the items in the government’s spending program before it is transmitted to Malacañang for the President’s signature.

From a goal of having a balanced budget this year, the administration had already revised its projection and set a budget deficit ceiling of P75 billion, and P40 billion in 2009. It still aims for a balanced budget by 2010 when Mrs. Arroyo’s six-year term ends.

But a few days ago, Deputy Treasurer Eduardo Mendiola was quoted in news reports with an optimistic view that the government is on track in meeting its deficit target, noting a modest surplus of P1.7 billion in August, when total revenue collections reached P118.9 billion while expenditure was kept at P117.2 billion.

Figures from the Department of Finance (DoF) show the level of deficit at P31.7 billion as revenues stood at P790.3 billion and expenditures swelled to P822 billion.

Source: NCB, NEDA presentation to Congress, 3 September 2008

The ABI anticipates adverse effects of the U.S. financial meltdown on the Philippine economy later this year and in 2009.

“It will affect investment flows in the Philippines and will most likely increase the cost of borrowings. A U.S. economic slowdown will dampen demand for Philippine exports, affect tourism and its impact on U.S. unemployment will affect our OFWs,” it warns.

Remittances sent by OFWs to their relatives in the Philippines have long been the lifeblood and the major source of income that drives consumer spending.

The ABI notes that from January to July this year, OFW remittances were estimated at $9.6 billion, of which $4.7 billion, or 49 percent of total remittances, came from Filipinos working in the U.S.

Debt payments: biggest slice in budget pie

Like in previous years, amortization and interest payments of government debts get the gigantic share in the total budget at P681.516 billion. Of this amount, only P302.650 billion is listed in the P1.415-trillion expenditure program. The bigger amount of P378.866 billion is an off-budget item based on an agreement between Malacañang and Congress in earlier years.

According to the ABI, the Arroyo administration will be borrowing P437.086 billion next year. Of this amount, P115.58 billion will be sourced from abroad and P321.50 billion will come from local sources.

In its computation, 86.68 percent of gross borrowings in 2009 will be used to amortize existing loans.

Source: BESF 2009

Education, which should get the biggest budgetary allocation as mandated by the Constitution, is given P167.9 billion, which is barely half of the money set aside for interest payments of debts.

Local government units, in fact, will also be getting a bigger share of P249.99 billion, or 18 percent of the total budget, than education.

Education gets the biggest amount only among the line departments in the bureaucracy, followed by public works and highways with P120 billion, interior and local government with P61.9 billion, national defense with P61.5 billion, and agriculture with P39.7 billion.

The ABI asserts that the figures in the Budget of Expenditures and Sources of Financing (BESF), the main document of Malacañang’s budget proposal to Congress, belie the pronouncements in the President’s budget message, which is also submitted along with the National Expenditure Program (NEP).

“In her budget message, the President said that the ‘…need …for borrowings to finance the deficit has been reduced from P75 billion this year to only P40 billion in 2009.’ She added that, ‘borrowings from the domestic and international markets will finance only three percent of our budget.’ With these statements, the President intends to make it appear as though debt is getting less significant in our budget and fiscal position. Government data show otherwise,” the ABI cites.

Estimates of the group show that the P40 billion target deficit in 2009 will account for 9.15 percent of the total gross borrowings of P437, 086 billion.

The ABI also finds inconsistency in the President’s statement that “next year’s budget shows the same growth orientation with more funds going towards capital outlay and less for debt service.”

“It is evident,” it says, “that debt service still corners the biggest share of available public financial resources.”

With the national and local election fever starting to catch up amidst the global financial flu, the budget watchdogs are counting on Congress to “step up to identify and unabashedly cut unnecessary, wasteful and frivolous spending” and make the budget an instrument for development by ensuring prudent spending of hard-earned taxpayers’ money.

The MOA-AD, the third agreement to have come out of the GRP-MILF peace negotiations, was supposed to have been signed by the chairs of the government and MILF peace panels last August 5 in Kuala Lumpur, Malaysia. But the high tribunal issued a temporary restraining order (TRO) a day ahead of the signing, granting the petition filed by critics led by North Cotabato Vice Governor Emmanuel Piñol.

Though the government eventually abandoned the MOA, majority of the SC justices (Chief Justice Reynato Puno, Associate Justices Consuelo Yñares-Santiago, Antonio Carpio, Adolfo Azcuna, Ruben Reryes, Leonardo Quisumbing, Alicia Austria-Martinez, and Conchita Caprio-Morales as ponente), insisted on issuing a ruling on its constitutionality. The justices scored the lack of public consultations on the agreement as required by law, even pointing out the “whimsical, capricious, oppressive, arbitrary, and despotic” manner by which it was designed and crafted. They also noted how the government panel usurps the powers of Congress by guaranteeing in the MOA-AD the required amendments to the 1987 Constitution.

But while senators and other critics welcomed the SC decision, Atty. Marvic Leonen, dean of the College of Law of the University of the Philippines, thought it was a “recipe for disaster.”

In his talk at the PCIJ-Newsbreak seminar on “Reporting on Conflict and Peace: The Story of Mindanao” two weeks ago in Zamboanga City, Leonen somehow anticipated how the SC would rule on the ancestral domain agreement, saying that the “worst thing the Supreme Court can do is for it to say that in all peace negotiations, the Constitution is the framework, and all of it.” (see also “Will jurisprudence finally give peace a chance?“)

To negotiate only to the extent that the Constitution allows, which will require amending it first before the government can offer certain terms, Leonen said, is “scary.”

“How can a minority ever change the Constitution?” he asked. “And when ever in our history did we take into consideration ethnicity or the interest of an ethnic group, the Moro peoples, when we crafted the Constitution?”

Listen to Dean Leonen’s talk on The Law and BJE: The Prospects for ‘Legalizing’ Peace:

• Part 1
  Length: 00:32:45
  Language: English and Filipino
  File size: 29.9 MB

• Part 2
  Length: 00:30:22
  Language: English and Filipino
  File size: 27.8 MB

Nonetheless, it can be argued, Leonen said, that what the MOA-AD stipulates — among them the creation of the Bangsamoro Juridical Entity (BJE) out of an expanded Autonomous Region in Muslim Mindanao (ARMM) that would have full authority to develop and exploit natural resources within its delineated territory — can be done within the context of the 1987 Constitution.

An autonomous region, he said, is allowed within the framework of the Constitution, adding that national sovereignty and territorial integrity are respected in the MOA as evidenced by the absence of provisions for a separate flag, a 9th ray in the Philippine flag, or internationalizing the BJE’s personality except through “best efforts.”

Leonen also pointed out that there is recognition in the MOA of a central government, whose relationship to the BJE shall be associative, characterized by shared authority and responsibility within a structure of governance based on executive, legislative, judicial and administrative institutions. These, he said, are precisely what the Constitution requires.

Moreover, Leonen said it is within the power of the President as commander-in-chief (as stated in Article VII of the Constitution) to politically agree to create the process and institutions mentioned in the MOA-AD. Given such commander-in-chief powers, the President should have a lot of leeway in waging peace as in waging war, he said.

Indeed, there is no question as to the benefits offered by technology. But apart from its use, other stages in an electronic product’s life cycle such as its manufacturing, recycling, and disposal entail impacts that could make one look at electronic gadgets differently.

Contrary to the “clean” image being projected by the high-technology industry, there are also serious health and environmental downsides involved, said Ted Smith, founder of the Silicon Valley Toxics Coalition (SVTC).

Speaking at a forum last week, the responsible technology advocate explained that the production of electronic and computer parts contaminate air, land, and water across the globe. Poor working conditions in the manufacturing and hazards in the recycling and disposal of electronic equipment also pose danger to health. (See also the PCIJ’s 2003 report, “Second Life for Dead PCs.”)

What’s worrisome, he said, is that those who suffer these consequences are largely “the poor, female, immigrant, and minority.”

Health hazards

Smith said semiconductor workers in Silicon Valley in California in the U.S. experience illness rates three times higher than manufacturing workers in other industries. Based on epidemiological studies too, women who worked in fabrication rooms experience miscarriages at a rate 40 percent higher or more than non-manufacturing workers. Silicon Valley also has more Environmental Protection Agency (EPA) Superfund sites than any other area in the country.

These health hazards are not limited to the U.S. alone, pointed out Smith.

Due to cheap labor costs and weak occupational safeguards, developing countries — the Philippines included — are tapped by multinational companies, mostly American and Japanese, for middle- and low-end work such as the assembling of computer and other electronic parts.

The main concern here, Smith explained, is that some of the 1,000 chemicals used in computer production are toxic. Among these chemicals include:

• Solvents to make chips, disk drives, and other parts
• Lead and cadmium in circuit boards
• Lead and barium in monitors
• Brominated flame retardants on printed circuit boards, cables, and plastic casings
• Poly-vinyl chloride (PVC) casings
• Mercury switches and flat screens
• Brominated flame retardant in plastics

In Taoyuan, Taiwan, for example, more than 1,000 former employees who used to make television sets and semiconductors for electronic company RCA are reportedly suffering from cancer. Also, more than 200 former RCA workers have reportedly died.

In Mexico and Bangkok, meanwhile, electronic manufacturing workers have also made protests and demanded companies like Hitachi and Intel to uphold labor rights.

‘E-waste’

Potential hazards in the electronic industry are not just confined within factories. These even extend up until the recycling and disposal of products.

Cell phones, for instance, have an average lifespan of 18 months while a personal computer is now pegged to last for only three to five years. These high rates of obsolescence plus the increasing number of cell phone and computer users (over one billion cell-phone users worldwide) are producing immense quantities of electronic waste (e-waste), making it the fastest growing component of the waste stream.

What’s more alarming, SVTC’s Smith said, is that e-waste is exported to less developed countries. The SVTC, along with the Basel Action Network (BAN), Greenpeace and other nongovernmental groups, has identified the U.S., Japan, South Korea, Australia, and the European Union as e-waste exporting countries.

Click here for a larger view of the map.

The U.S. is said to export 50 to 80 percent of its e-waste to Asian countries, namely, China, Thailand, Singapore, India, and Pakistan. Meanwhile, the Philippines, Indonesia, Vietnam, and Malaysia are suspected to be e-waste destinations too.

No quantitative data on volumes have been recorded due to the lack of a system for tracking legal or illegal (under international law) shipments of e-waste.

According to the groups, some e-waste are shipped as “working equipment” only to end up as waste upon arrival in the countries of destination.

Smith further said that around 300 million computers have become obsolete in 2004. These computers are made up of four billion pounds of plastic, one billion pounds of lead, 1.9 million pounds of cadmium, 1.2 million pounds of chromium and 400,000 pounds of mercury.

A 2005 study conducted by Greenpeace Southeast Asia warned that a host of toxic substances are released into the environment whenever e-waste end up in landfills and dirty recycling operations. This is said to create “a nightmare of pollution and grave worker and community exposure.”

Smith, who also authored the book “Challenging the Chip: Labor Rights and Environmental Justice in the Global Electronics Industry” urged that computer manufacturers use less hazardous materials in their products. He also encouraged these companies to take back obsolete computers through the Computer Take Back program.

As for consumers, Richard Gutierrez, executive director of Ban Toxics!, the Asia-Pacific office of the Basel Action Network, suggested that buyers look for computers that are compliant with the RoHS Directive, which stands for “the restriction of the use of certain hazardous substances in electrical and electronic equipment.”

RoHS-compliant products do not contain more than the agreed levels of lead, cadmium, mercury, and other chemicals and are therefore less harmful. (see also “The race for greener cell phones and PCs“)

Gutierrez also added that consumers should keep and not dispose of their old computers and share information on e-waste.