On September 21, 1972, Marcos issued Proclamation 1081, declaring martial law over the entire country. Under the president's command, the military arrested opposition figures, including Benigno Aquino, journalists, student and labor activists, and criminal elements. A total of about 30,000 detainees were kept at military compounds run by the army and the Philippine Constabulary. Weapons were confiscated, and "private armies" connected with prominent politicians and other figures were broken up. Newspapers were shut down, and the mass media were brought under tight control. With the stroke of a pen, Marcos closed the Philippine Congress and assumed its legislative responsibilities. During the 1972-81 martial law period, Marcos, invested with dictatorial powers, issued hundreds of presidential decrees, many of which were never published.

Like much else connected with Marcos, the declaration of martial law had a theatrical, smoke-and-mirrors quality. The incident that precipitated Proclamation 1081 was an attempt, allegedly by communists, to assassinate Minister of National Defense Enrile. As Enrile himself admitted after Marcos's downfall in 1986, his unoccupied car had been riddled by machinegun bullets fired by his own men on the night that Proclamation 1081 was signed.

Most Filipinos--or at least those well positioned within the economic and social elites--initially supported the imposition of martial law. The rising tide of violence and lawlessness was apparent to everyone. Although still modest in comparison with the Huk insurgency of the early 1950s, the New People's Army was expanding, and the Muslim secessionist movement continued in the south with foreign support. Well-worn themes of communist conspiracy--Marcos claimed that a network of "front organizations" was operating "among our peasants, laborers, professionals, intellectuals, students, and mass media personnel"--found a ready audience in the United States, which did not protest the demise of Philippine democracy.

The New Society

Marcos claimed that martial law was the prelude to creating a "New Society" based on new social and political values. He argued that certain aspects of personal behavior, attributed to a colonial mentality, were obstacles to effective modernization. These included the primacy of personal connections, as reflected in the ethic of utang na loob, and the importance of maintaining in-group harmony and coherence, even at the cost to the national community. A new spirit of self-sacrifice for the national welfare was necessary if the country were to equal the accomplishments of its Asian neighbors, such as Taiwan and the Republic of Korea (South Korea). Despite Marcos's often perceptive criticisms of the old society, Marcos, his wife, and a small circle of close associates, the crony group, now felt free to practice corruption on an awe-inspiring scale.

Political, economic, and social policies were designed to neutralize Marcos's rivals within the elite. The old political system, with its parties, rough-and-tumble election campaigns, and a press so uninhibited in its vituperative and libelous nature that it was called "the freest in the world," had been boss-ridden and dominated by the elite since early American colonial days, if not before. The elite, however, composed of local political dynasties, had never been a homogeneous group. Its feuds and tensions, fueled as often by assaults on amor proprio (self-esteem) as by disagreement on ideology or issues, made for a pluralistic system.

Marcos's self-proclaimed "revolution from the top" deprived significant portions of the old elite of power and patronage. For example, the powerful Lopez family, who had fallen out of Marcos's favor (Fernando Lopez had served as Marcos's first vice president), was stripped of most of its political and economic assets. Although always influential, during the martial law years, Imelda Marcos built her own power base, with her husband's support. Concurrently the governor of Metro Manila and minister of human settlements (a post created for her), she exercised significant powers.

Crony Capitalism

During the first years of martial law, the economy benefited from increased stability, and business confidence was bolstered by Marcos's appointment of talented technocrats to economic planning posts. Despite the 1973 oil price rise shock, the growth of the gross national product (GNP) was respectable, and the oil-pushed inflation rate, reaching 40 percent in 1974, was trimmed back to 10 percent the following year. Between 1973 and the early 1980s, dependence on imported oil was reduced by domestic finds and successful energy substitution measures, including one of the world's most ambitious geothermal energy programs. Claiming that "if land reform fails, there is no New Society," Marcos launched highly publicized new initiatives that resulted in the formal transfer of land to some 184,000 farming families by late 1975. The law was filled with loopholes, however, and had little impact on local landowning elites or landless peasants, who remained desperately poor.

The largest, most productive, and technically most advanced manufacturing enterprises were gradually brought under the control of Marcos's cronies. For example, the huge business conglomerate owned by the Lopez family, which included major newspapers, a broadcast network, and the country's largest electric power company, was broken up and distributed to Marcos loyalists including Imelda Marcos's brother, Benjamin "Kokoy" Romualdez, and another loyal crony, Roberto Benedicto. Huge monopolies and semimonopolies were established in manufacturing, construction, and financial services. When these giants proved unprofitable, the government subsidized them with allocations amounting to hundreds of millions of pesos. Philippine Airlines, the nation's international and domestic air carrier, was nationalized and turned into what one author has called a "virtual private commuter line" for Imelda Marcos and her friends on shopping excursions to New York and Europe.

Probably the most negative impact of crony capitalism, however, was felt in the traditional cash-crop sector, which employed millions of ordinary Filipinos in the rural areas. (The coconut industry alone brought income to an estimated 15 million to 18 million people.) Under Benedicto and Eduardo Cojuangco, distribution and marketing monopolies for sugar and coconuts were established. Farmers on the local level were obliged to sell only to the monopolies and received less than world prices for their crops; they also were the first to suffer when world commodity prices dropped. Millions of dollars in profits from these monopolies were diverted overseas into Swiss bank accounts, real estate deals, and purchases of art, jewelry, and antiques. On the island of Negros in the Visayas, the region developed by Nicholas Loney for the sugar industry in the nineteenth century, sugar barons continued to live lives of luxury, but the farming community suffered from degrees of malnutrition rare in other parts of Southeast Asia.

Ferdinand Marcos was responsible for making the previously nonpolitical, professional Armed Forces of the Philippines, which since American colonial times had been modeled on the United States military, a major actor in the political process. This subversion occurred done in two ways. First, Marcos appointed officers from the Ilocos region, his home province, to its highest ranks. Regional background and loyalty to Marcos rather than talent or a distinguished service record were the major factors in promotion. Fabian Ver, for example, had been a childhood friend of Marcos and later his chauffeur, rose to become chief of staff of the armed forces and head of the internal security network. Secondly, both officers and the rank and file became beneficiaries of generous budget allocations. Officers and enlisted personnel received generous salary increases. Armed forces personnel increased from about 58,000 in 1971 to 142,000 in 1983. Top-ranking military officers, including Ver, played an important policy-making role. On the local level, commanders had opportunities to exploit the economy and establish personal patronage networks, as Marcos and the military establishment evolved a symbiotic relationship under martial law.

A military whose commanders, with some exceptions, were rewarded for loyalty rather than competence proved both brutal and ineffective in dealing with the rapidly growing communist insurgency and Muslim separatist movement. Treatment of civilians in rural areas was often harsh, causing rural people, as a measure of self-protection rather than ideological commitment, to cooperate with the insurgents. The communist insurgency, after some reverses in the 1970s, grew quickly in the early 1980s, particularly in some of the poorest regions of the country. The Muslim separatist movement reached a violent peak in the mid1970s and then declined greatly, because of divisions in the leadership of the movement and reduced external support brought about by the diplomatic activity of the Marcos government.

Relations with the United States remained most important for the Philippines in the 1970s, although the special relationship between the former and its ex-colony was greatly modified as trade, investment, and defense ties were redefined. The Laurel-Langley Agreement defining preferential United States tariffs for Philippine exports and parity privileges for United States investors expired on July 4, 1974, and trade relations were governed thereafter by the international General Agreement on Tariffs and Trade (GATT). During the martial law period, foreign investment terms were substantially liberalized, despite official rhetoric about foreign "exploitation" of the economy. A policy promoting "nontraditional" exports such as textiles, footwear, electronic components, and fresh and processed foods was initiated with some success. Japan increasingly challenged the United States as a major foreign participant in the Philippine economy.

The status of United States military bases was redefined when a major amendment to the Military Bases Agreement of 1947 was signed on January 6, 1979, reaffirming Philippine sovereignty over the bases and reducing their total area. At the same time, the United States administration promised to make its "best effort" to obtain congressional appropriations for military and economic aid amounting to US$400 million between 1979 to 1983. The amendment called for future reviews of the bases agreement every fifth year. Although the administration of President Jimmy Carter emphasized promoting human rights worldwide, only limited pressure was exerted on Marcos to improve the behavior of the military in rural areas and to end the death-squad murder of opponents. (Pressure from the United States, however, did play a role in gaining the release of Benigno Aquino in May 1980, and he was allowed to go to the United States for medical treatment after spending almost eight years in prison, including long stretches of time in solitary confinement.)

On January 17, 1981, Marcos issued Proclamation 2045, formally ending martial law. Some controls were loosened, but the ensuing New Republic proved to be a superficially liberalized version of the crony-dominated New Society. Predictably, Marcos won an overwhelming victory in the June 1981 presidential election, boycotted by the main opposition groups, in which his opponents were nonentities.

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Source: U.S. Library of Congress