Learning the wrong lesson - Frontline - Joseph P. Estrada, ex-Philippine president - Brief Article

Business Asia, March, 2002 by William Pesek, Jr

IT'S BEEN JUST 13 months since mass protests and impeachment drove ex-Philippine president Joseph Estrada from office.

The episode reminded Filipino voters why they doubt their government; investors were reminded why many steer clear of the Philippines.

Imagine the outrage, then, over the drive to give the detained Estrada a four-month pass -- or a much longer one -- to the United States. There are actually two give-Estrada-a-break drives. One would let him travel to the US for knee surgery, arguing local doctors stink. Estrada denies it's a ruse to escape justice, but folks here worry he'll seek political asylum abroad.

The other would put the accused plunderer in political exile -- the cushy kind. Not as punishment per se, but to get him out of the newspapers and make him less of a distraction for President Gloria Macapagal Arroyo. At least that's what his supporters argue. The public suspects it's a means of enabling Estrada to enjoy the fruits of his ill-gotten gains.

Either scenario sends a disturbing message -- crime does pay in the Philippines. The more important you are, the more wealth you can amass, the more backroom deals-for-cash you can do, then the more you can screw voters and get away with it. College kids here shouldn't waste their time studying computer science, economics or medicine. The real money, it seems, is in politics.

All of this is leading to an "Estrada Effect" on the national psyche -- and the economy. Today, a renewed sense of optimism is flowing through the nation's streets. Arroyo may not exude the charisma Filipinos crave in leaders, but the trained economist and policy wonk is working to stabilise the long-neglected economy.

Yet talk of the Estrada affair is omnipresent here. You can hardly take a taxi ride, get through a conversation or drop by a coffee shop without chatting about the man known to the public as "Erap." When many Filipinos discuss Estrada, it's with a mix of outrage, shock, hopelessness and humour.

Walking the streets of Manila, it's rare to find a person who isn't already miffed that Estrada is living the good life in a converted hospital. He's not spending his days in damp, cold jail cells in which those charged with much lesser crimes are housed.

Estrada allegedly made off with tens of millions of dollars during his 30-month presidency.

Over 40 percent of Filipinos live in poverty, a fact that's divided the Philippines into a nation of haves and have-nots. It was the have-nots that supported Estrada all along, only to see him violate their trust. Letting Estrada get on a plane and leave the country would trivialize his crimes and encourage future leaders to line their pockets. If you're caught, just find an excuse to fly far away.

Investors wouldn't respond well, either. South East Asia's legal systems often have trouble dealing with corrupt leaders. Look no further than Indonesia, where the government has considered pardoning disgraced former President Suharto. The mere consideration of excusing leaders who siphon millions from their people, investors say, spooks markets.

The Estrada mess hardly helps things. At the very heart of the Philippines' troubles is trust. Many of Arroyo's predecessors, in one way or another, violated it many times over, both for voters and investors.

If Arroyo's Government is to pass the global laugh test, it needs to take Estrada's actions seriously. Arroyo, after all, came to power on an anti-corruption platform. She pledged to end the nepotism and collusion infecting Manila's effectiveness.

Coddling Estrada might convince many that the new Philippines is little different from the old.

Bloomberg