Chinese ‘invasion’ of the Philippines

PerryScope
By Perry Diaz

Typically, when a foreign power invades another country, they’re met with resistance that could lead to war. But something unusual is happening in the Philippines — thousands of Chinese workers are invading the country and taking jobs away from Filipinos. However, Malacañang is not worried about it. In fact, they welcome it.

Recently, the Senate Labor, Employment, and Human Resources Committee conducted an inquiry on the influx of foreign workers in the Philippines. It was revealed that the Department of Labor and Employment (DOLE) issued almost 52,000 alien employment permits for Chinese workers. According to DOLE officials, more than 150,000 Chinese enter the country using tourist visas before getting short-term permits to work for online gaming firms. The Senate committee also found out that more than 119,000 tourists — mostly Chinese — were able to avoid Philippine labor regulations. Current estimates place 200,000 to 400,000 Chinese are working in Philippine Offshore Gaming Operations (POGOs), which were established after President Rodrigo Duterte took over the government in 2016. Currently, there are around 50 POGOs in operation today, mostly operated by Chinese nationals.

But what’s causing the ease for foreigners to acquire work permits is a glaring loophole in the DOLE system where any of the 3.12 million Chinese “tourists” registered at the Bureau of Immigration (BOI) can convert their tourist visas into working visas as long as they obtain an Alien Employment Permit (AEP). And while waiting for their AEP, they are issued a Provisional Work Permit (PWP). So, in a practical sense, any tourist admitted to the country can stay and work without too much of a hassle.

As one resident in Metro Manila had observed: “The Chinese have invaded our islands in the West Philippine Sea and now they’re in my condo! It’s a home invasion!”

“Build, Build, Build”

Well, POGOs are just one industry that is employing a large number of Chinese nationals. The bigger industry, which is growing fast, is the “Build, Build, Build” infrastructure project of President Duterte, which is estimated at US$180 billion. What we’re talking about here are construction workers — tens of thousands — employed by Chinese state-owned contractors.

All the contracts that the Philippines had agreed to undertake with Chinese bank loan financing, the following conditions are included: No bidding process, project to be done by one of China’s state-owned companies, the workers to be Chinese nationals, cost overruns to be renegotiated (that usually ends in higher interest rates), and others including asset-based lending practices.

What is interesting to note is that the Chinese contractors who got the no-bid contracts, hire Chinese nationals, transport them to construction sites, provide housing and meals, and pay them according to China’s pay standards, which are much higher than Philippine pay standards. I n essence, Duterte’s infrastructure project does not increase the country’s construction employment opportunities.

There were reports that the Chinese workers are paid on the average P3,000 a day while Filipino construction workers are paid on the average P600 a day, which would definitely cause resentment and outrage.

One has to remember that the Chinese construction companies will only hire Chinese construction workers as per contract condition. The pay is already built-in to the cost of construction. But here’s the sad part: The Philippine government is paying for the cost of construction plus whatever profit, overhead, housing allowances for the Chinese workers, and other costs are added to the total contract amount. The question is: Would it cost less to hire Filipino construction workers? Absolutely. But then these are the conditions the Chinese government imposed on the countries that were enticed into infrastructure projects with high-interest predatory loans from Chinese banks chosen by the Chinese government.

To entice Chinese workers to work in the Philippines, they have to be paid comparably or more than what they earn in China. After all, it didn’t matter to the Chinese construction companies because the extra cost of labor would be added to the total construction cost, which is paid by the host country, the Philippines.

But what’s happening to Chinese construction projects in the Philippines is also happening in all the countries where China is building infrastructure projects, including 35 seaports around the world. To date, 16 countries are vulnerable to China’s “debt-trap diplomacy” and economic coercion, including Vanuatu, the Philippines, Cambodia, Laos, Thailand, Malaysia, Sri Lanka, Tonga and Micronesia.

Ghost cities

Three decades ago when China’s export market increased in volume, China embarked on a massive project; building high rise housing projects in newly created cities in anticipation of the growing middle class. Well, they over-built hundreds of them in what are now called “ghost cities.” Some say that they were built on purpose knowing that the growing middle would buy the hundreds of thousands of units built. Economic experts said that by expanding the construction industry, millions of construction jobs were created in the 1990s and 2000. It also caused China’s GDP to grow year after year. But like anything else, good things come to an end sooner or later. When the construction bubble finally burst, China had to find ways to put her construction and infrastructure workers in new projects. And with not enough domestic projects to work on, well…. where else would they go?

One Belt, One Road

Chinese ports around the world.

When Chinese President Xi Jinping came to power, he dreamed of China becoming a superpower. But he couldn’t dislodge America from her perch as the world’s sole superpower. His “China Dream” took shape with his “Soft power diplomacy,” which is to gain economic power as a first step to becoming a superpower.

Xi then embarked on a “soft-power diplomacy” to sell China’s infrastructure projects to other countries. That’s when his “One Belt, One Road” (OBOR) Initiative came to fruition. He envisioned OBOR as the new Silk Road connecting Asia and the Western World by land and by sea. To date, China has built 35 seaports around the world creating sea routes — called “String of Pearls” — from the East and South China Seas to the Indian Ocean to Africa and Western Europe. Recently, China was trying to take over the Hanjin Philippines operations at Subic Bay, the former U.S. naval base.

Last November 2018, Xi visited the Philippines for the first time and sealed 29 infrastructure projects with Duterte. It opened to doors for Chinese workers to come to the Philippines, since the “Build, Build, Build” projects were designed to be funded by Chinese banks and utilize Chinese contractors and workers only.

But things don’t seem to be what they should be. And the biggest problem that’s looming in the horizon is China’s OBOR Initiative itself. After pouring trillions of dollars into these grandiose infrastructure projects, participants are beginning to worry that OBOR is China’s thinly disguised strategy to expand her influence over countries from Asia to Western Europe. Instead of signing up to make deals with China, many countries are now beginning to stay away from doing business with her. But how about the 16 countries that have already been entrapped in China’s debt-trap diplomacy? Do they have a way out? Or would they suffer the fate of Sri Lanka, shackled in debt and her patrimony collateralized?

Which begs the question: Could China’s miscalculation of her OBOR Initiative would cause her construction industry to crash and open the floodgates to Chinese “invasion” of the Philippines and other countries?

(PerryDiaz@gmail.com)

A Russian mole in the White House?

Kaleidoscope
By Perry Diaz

On January 24, 2019, Rachel Maddow, MSNBC’s star talk show host, mentioned Carl Kline as a former career Pentagon employee who was appointed by President Donald Trump as Director of Personnel Security at the White House in May 2017. He’s in charge of reviewing applications for security clearances of people appointed to high administration positions. The reasons for denying a clearance can include debts, a criminal past or questions about foreign entanglements, and anything in a person’s background that could make them vulnerable to blackmail.

According to Maddow, an adjudicator reviewed Kushner’s application for security clearance. It was deemed “unfavorable” and handed it to a supervisor. The supervisor agreed that it was “unfavorable” and sent it to Kline who then overruled the “unfavorable” determination and approved a “Top Secret” security clearance for Kushner.

As it turned out, in the short time that Kline was on the job, he had ignored national security risks more than 30 times to approve clearances for White House personnel. “Thirty times, at least, this one supervisor whom Trump put in there … handed out a clearance to an incoming Trump White House person who was otherwise flagged as too risky to get a clearance approved,” Maddow said. “Thirty of them. At minimum. Christ.” Sources said the number of rejections that Kline overturned had happened only once in the three years preceding Kline’s appointment, which makes one wonder: Was there someone higher up who directed Kline to overrule his subordinates?

During the FBI background investigation of White House Special Adviser Jared Kushner, there were “questions about his family’s business, his foreign contacts, his foreign travel, and meetings he had during the campaign.”

Kushner is married to Ivanka Trump, the president’s daughter. He holds the role of Special Adviser to the President in the White House with responsibility over the Middle East, Mexico, criminal justice reform, and innovation in government. He was one of those whom Kline overruled two career security experts who determine Kushner as too risky, and approved Kushner’s “top-secret clearance.” The two security clearance specialists are concerned that Kushner was potentially susceptible to foreign influence.

Security breach
The scandal surfaced as Rep. Elijah Cummings, the top Democrat on the House Oversight Committee, had characterized approval of Kushner’s clearance as “unprecedented.”

“My request letter to the White House explicitly covers Mr. Kushner, and we expect the White House to produce all of the documents and interviews we requested to determine if tonight’s breaking story is accurate,” Cummings (D-Md.) said. “The system is supposed to be a nonpartisan determination of an individual’s fitness to hold a clearance, not an ad hoc approach that overrules career experts to give the President’s family members access to our nation’s most sensitive secrets.”

Not content with his White House “top-secret clearance,” Kushner sought to get higher security clearance so he would have access to the government’s most highly guarded information, known as “Sensitive Compartmented Information” (SCI). But only the CIA can approve SCI clearances. The agency rejected the request and returned the application to the White House, questioning how Kushner even obtained a “top-secret clearance” to begin with. Had the CIA granted Kushner an SCI clearance, he would have access to information that could cause “exceptionally grave damage” to national security if it were leaked out.

The problem is: Trump can override CIA’s determination and make any information available to his son-in-law at any time. Reportedly, Kushner had regular access to Trump’s highly classified Presidential Daily Brief (PDB) during Trump’s first year in office. Presumably, Kushner still have access to it simply by reading the PDB, which he can get at will. Call it part of “family privileges.”

It is now up to Cummings who wields the power of the Oversight Committee to investigate how Kushner and other Trump officials managed to get their security clearance, including former national security adviser Michael Flynn, who pleaded guilty to lying to the FBI about his interactions with Russia during the transition; Rob Porter, a former White House staff secretary who resigned after multiple allegations of domestic abuse; and former deputy assistant to the president Sebastian Gorka.

Red flags
Those who previously operated on Top Secret or SCI interim clearances saw their access changed to “Secret,” a classification for less sensitive material. A Secret clearance only allows access to fewer and lesser government secrets. It prevented Kushner from accessing the PDB. But because of Kushner’s affinity to Trump by marriage, it’s doubtful if Trump didn’t share the PDB with Kushner. However, Kushner accepted the decision about his security clearance and “will not ask for special permission” from Trump. But it makes one wonder: How can Kushner perform his function without access to Top Secret or SCI clearances?It’s interesting to note that this is not the first time that Kushner have a problem with his security clearance. A year ago, he was stripped of his access to the nation’s top secrets after his security clearance was downgraded. Along with several White House officials who had been operating on interim clearances, their access was altered after chief of staff John Kelly stipulated new changes to the security clearance system.

Kushner’s use of security clearance is now the subject of the Democrats’ inquiry. After Trump won the presidential election Kushner had private discussions with the Russian ambassador about opening a secret “back channel” with Moscow to discuss policy. This was a red flag that immediately put Kushner under the FBI’s scrutiny.

Wthin a short time after Trump was inaugurated as president, the Washington Post reported that Kushner had been the subject of at least four countries – United Arab Emirates, China, Israel, and Mexico – as possible target of manipulation. Concerns were raised about Kushner’s “irregular” way of accessing very sensitive intelligence. Indeed, the powerful Democrat-led House Oversight Committee had opened an in-depth investigation into what it said were “grave breaches of national security at the highest levels of the Trump administration.”

Trump-Putin Chabad connection
When Kushner was a student at Harvard, he was affiliated with the Chabad house. Since settling in Washington DC, Jared and Ivanka (who converted to Judaism prior to marrying Jared) have been attending services at a Chabad synagogue. Meanwhile, Ivanka was very close friends with Abramovich’s wife, Dasha Zhukova, who attended the Trump inauguration as Ivanka’s personal guest. [Ibid]In 1999, Putin enlisted two of his closest confidants, the oligarchs Lev Leviev and Roman Abramovich — who would go on to become the Chabad-Lubavitch movement’s biggest patrons worldwide — to create the Federation of Jewish Communities of Russia under the leadership of Chabad rabbi Berel Lazar, who would come to be known as “Putin’s rabbi.” [Source: The Odd Chabad Connection Between Putin and Trump]

In May 2015, a month before Trump officially entered the Republican presidential primary, Kushner bought a majority stake in the old New York Times building on West 43rd Street from Leviev for $295 million. The transaction first came up due to the $285 million Kushner borrowed from Deutsche Bank to complete the transaction. Deutsche Bank and two companies tied to Leviev, Africa Israel Investments, and Prevezon have all recently been the subject of money laundering investigations. A laundering case against Prevezon led by then-U.S. Attorney Preet Bharara abruptly ended in May 2017, two months after Trump fired Bharara, with a $6-million settlement that raised eyebrows. [Ibid]

Could it be that the financial transactions involving Kushner and the Russian oligarchs close to Putin one of the reasons why Kushner’s application for security clearance was red flagged? Was this just the tip of the iceberg, which begs the question: Would the Mueller investigation into the Trump-Putin Chabad connection lead to indictments?

At the end of the day, with more than 30 security clearances, including Kushner’s, that were approved over the rejection by career security clearance experts, what is the likelihood that there is a Russian mole in the White House?

(PerryDiaz@gmail.com)

Thankful to China

ON DISTANT SHORE
By Val G. Abelgas

On Saturday, Foreign Secretary Teddy Boy Locsin said the Philippines must protest China’s establishment of a maritime rescue center on the contested Kagitingan Reef in the Spratly Islands. Locsin, just recently the country’s ambassador to the United Nations, said he agreed with the position of Supreme Court Senior Associate Justice Antonio Carpio that the country must lodge a protest as not doing so could mean consent to China’s recent aggressive action in the disputed waters.Finally, a different tone is emerging from the Department of Foreign Affairs on China’s aggressive actions in the South China Sea.

“This means we are recognizing that China has a right to occupy and use Fiery Cross Reef. Occupation and use are acts of sovereignty. This contradicts our claim that we have sovereignty over Fiery Cross Reef,” Carpio said.

Locsin, however, was vague about filing a formal protest, which the government should have done immediately upon China’s pronouncement that it has built the structure. In a tweet — hardly the proper way for the country’s top diplomat to state his objection — Locsin said he would rather voice his protest on the floor of the United Nations General Assembly.

Still, Locsin’s tweet – statement, if you may – was an improvement over his previous position that he was not keen on filing protests against China. “Every time you send a note verbale and no one responds to it, what does that look like? When you keep sending those notes – I know some people say, you just keep on sending them – what I keep calling it is banging your head against the wall,” he said then.

Also, his promise to bring the protest to the UN floor was completely different from the official reaction from Malacanang on reports that China has constructed a maritime rescue center in the South China Sea, or what our government wants to call the West Philippine Sea.

Instead of protesting, Presidential Spokesperson Salvador Panelo said in his usual light tone that we should even be thankful to China. “Maybe we should be thankful,” Panelo said. “That could help seamen in distress, it can help everybody.”

Even Defense Secretary Delfin Lorenzana, the man tasked to defend the country’s national security and sovereignty, thinks along the same line as Panelo, saying that the defense department would “do nothing” because “it would help seamen in distress.”

So, will the Philippines file a formal protest or not? From the looks of it and based on the policy of appeasement President Duterte has followed on China, there will be no formal protest. It is even doubtful that beyond his tweets, Locsin would even pursue his promise of protesting China’s actions before the world’s delegates in the world body.

And this non-action is precisely what worries Carpio and other foreign policy experts.

In the usual propaganda line of the Chinese government, China’s Ministry of Transport announced it has opened the new facility on Kagitingan Reef (Fiery Cross Reef). “The center will offer better support to maritime rescue operations in the southern part of the South China Sea,” the ministry said.

“We should protest because Fiery Cross Reef is part of the geologic features we claim in the Kalayaan Island Group. If we do not protest, then we impliedly consent to China’s act of putting up a maritime rescue center there,” Carpio said. “This means we are recognizing that China has a right to occupy and use Fiery Cross Reef. Occupation and use are acts of sovereignty. This contradicts our claim that we have sovereignty over Fiery Cross Reef.”

Maritime expert Dr. Jay Batongbacal, who along with Carpio has been warning the Philippines and whoever cares to listen about China’s true intent in the South China Sea, calls the propaganda line China’s gray zone tactics that aim to put a “soft face” to its aggressive behavior in the disputed waters to downplay or maybe even hide their military activities in the area.

The Chinese are making it appear that they are, in fact, helping, and not restricting, maritime navigation in the area by providing assistance to vessels operating in the area. The ministry said that, in fact, two rescue ships that it had sent to Zamora Reef have rescued 16 people and two ships in eight rescue operations.

We all know, of course, that these installations that China has built on reclaimed islands are not for civilian purposes, as China claims, but to project China’s military power over the region. Independent agencies have released photos of missile launchers and radar-jamming equipment in these structures. There is also no doubt that the missile shelters, runways, ports, and aircraft hangars built in recent years are military installations and not for civilian use.

Batongbacal said China will continue to give the islands a “soft face” in “an attempt to look good to create a more benign image in the region especially in light of the ongoing competition with the United States.”

Both Batongbacal and Carpio warned that the building of the supposed maritime rescue center, the weather stations and the implementation of alleged ecological protection programs in the area are all designed to create a sense of civilian administration and control of the contested area, which are essential in establishing sovereignty over the islands.

Either Panelo and Lorenzana have fallen prey to China’s propaganda line or they are part of the whole shebang as part of the Duterte administration’s policy of appeasement with China.

While the Duterte administration continues to profess trust for China, Filipinos have repeatedly shown overwhelming distrust for China in surveys after surveys. But did it ever matter to Duterte and his friends?

In the meantime, China continues to creep into the country’s sovereignty without a nary a word from our government except to thank its benefactor.

(valabelgas@aol.com)

How dangerous is the Philippines?

PerryScope
By Perry Diaz

A global study conducted by Global Finance Magazine (GFM) placed the Philippines as the world’s “Most Dangerous Country.”  GFM’s explanation why the Philippines is more dangerous than Yemen and 126 other countries is: “The safety score for countries equally weighs each of the three factors: (1) War and Peace, (2) Crime Risk, and (3) Natural Disaster Risk. The safety score aggregates the indices from these three risks, thus presenting a comprehensive view of safety for each country.”

GFM further explained: “This also means that a high level of risk in one factor will have limited effect on the country’s overall ranking.  For example, the Philippines is ranked least safe while Yemen is ranked second least safe. This can be attributed to the fact that the Philippines has poor scores in peace, security, and prevalence of natural disasters.  Yemen’s terrible score is due to war and famine but the country has a very low risk of natural disaster. Thus, the Philippines ranks lower than Yemen even though Yemen is a war zone.”

GFM said its Safety Index Score (SIS) used data from the World Economic Forum and the Global Institute for Peace to create the list. The SIS study covers 128 countries or over 99.7% of the world’s population and are assessed using 23 indicators.  Countries that hardly have any natural disaster -- such as Iceland -- would be low on the SIS list.  On the other hand, countries that have a high risk of natural disasters – such as the Philippines -- would be high on the SIS list.

Global Peace Index

But another study conducted by the Global Peace Index (GPI), which is produced by the Institute for Economics & Peace (IEP), showed the Philippines as “Dangerous” but not the “Most Dangerous.”

GPI measures “global peace” using three broad themes: (1) The level of safety and security in society, (2) The extent of domestic and international conflict, and (3) The degree of militarization.  Unlike the SIS, the GPI doesn’t include “Natural Disaster Risk” as a factor, which made a big difference in the case of the Philippines because of the tropical storms that left in their wake a devastated country.  And this may have made a big difference in weighing the “safety” of the Philippines within the SIS and GPI studies.

The following are the highlights of the 2018 GPI list:

1.  Countries that are engaged in wars or civil wars were high on the GPI list, which placed Syria as the “Most Dangerous Country” for the third consecutive year.

2.  The Philippines is 27th on the GPI list.  She is preceded by more dangerous countries Eritrea, Ethiopia, Mexico, Palestine, and Egypt.  She is followed by less dangerous countries India, Chad, Burundi, Cameroon, and Azerbaijan.

3.  On the other end of the GPI scale, the most peaceful countries were Iceland, New Zealand, Austria, Portugal, Denmark, and Canada.  Iceland has been ranked as the world’s “Most Peaceful” country every year since 2008.

Natural Disasters

When the Global Finance Magazine report came out, Filipinos in social media were outraged.  Many of them claimed that the study was “fake news.”  They said that it was a “hit piece” meant to disparage the Philippines and her leaders.

This writer believes that “War and Peace” and “Crime” can be prevented or controlled by man, while “Natural Disasters” cannot be prevented or controlled by human intervention.  Natural disasters are limited to a smaller number of countries mostly in Asia.  It is unfair to Asian countries while it gives advantage to countries that don’t have high or no occurrences of natural disasters such as Middle Eastern and African countries.  Therefore, “Natural Disaster Risk” shouldn’t be used to measure “safety.”

Take for instance the Pacific Ring of Fire.  According to Wikipedia, it is a major area in the basin of the Pacific Ocean, where many earthquakes and volcanic eruptions occur.  It has 452 volcanoes (more than 75% of the world’s active and dormant volcanoes).  All but three of the world's 25 largest volcanic eruptions of the last 11,700 years occurred at volcanoes in the Pacific Ring of Fire.

A volcanic eruption could cause a huge tidal wave called tsunami.  The two tsunamis that occurred in the Aceh region in Indonesia in the past decade caused massive destruction and deaths.  Tsunami occurs frequently in Japan.  Tsunamis and volcanic eruptions cannot be controlled or prevented.

Another type of natural disaster is tropical storm, which originates from the Pacific Ocean and moves westward towards Eastern Philippines and eventually hits East Asia and Southeast Asia.  Tropical storms hit the Philippines at least 20 times a year of which five to eight would wreak havoc to almost all the regions in the country.

To factor Natural Disaster Risk into the Safety Index Score is therefore unfair to countries that are vulnerable to earthquakes, tropical storms, and tsunamis.

If Global Finance Magazine fails to remove “Natural Disaster Risk” from the criteria used in the Safety Index Score, countries around the Pacific Ring of Fire would be at a disadvantage and their Safety Index Score would continually rate them as more dangerous than countries that have lesser Natural Disaster Risk or none at all.

Illegal drugs

In the case of Global Peace Index published by the Institute for Economics & Peace, this writer believes that the factors used in the study were fair and objective.  In the case of the Philippines, President Rodrigo Duterte’s administration could improve the safety of the citizens from criminal elements. 

But as it turned out, extrajudicial killings (EJKs) perpetrated by criminal elements have become the number one threat to the safety of the citizens.  While EJKs were intended to reduce the number of drug pushers and users, recent police data showed that they have increased, which makes one wonder if EJK is effective in stopping drug smuggling and trafficking?

The Duterte administration should go after the drug smugglers and traffickers, not their victims.  Rid the Philippines of predatory drug traffickers and you’d see a rapid decline in the use of illegal drugs, which is the most dangerous threat to the safety of Filipinos.

This writer therefore recommends that “Illegal Drug Risk” replace “Natural Disaster Risk” in the GFM’s Safety Index Score.  We can then say that the Safety Index Score truly reflects a “comprehensive view of safety for each country.”  And at that time, we can then ask: How dangerous is the Philippines?

(PerryDiaz@gmail.com)

Has the Den Mother outfoxed the Fox?

Kaleidoscope
By Perry Diaz

When the 116th Congress of the United States was convened on January 3, 2019, little did I the people know how the new majority – the Democrats – would deal with President Donald Trump?

Being the opposition party, the Democrats have to tread carefully in a swamp filled with crocodiles bred in the two years the Republicans were of power. Yes, the Republicans had full control of the executive and legislative branches of government, and influence over the five Republican-appointed justices of the Supreme Court including the Chief Justice, who had in a few instances voted with the minority liberal bloc to the consternation of the conservative bloc. Now, President Trump can no longer be sure which way the Chief Justice would swing the pendulum of justice -- right or left?

Trump, who had been used to dictating what he wanted to get out of the Republican Congress, tries in a futile attempt to get the $5.7 billion funding for his border wall. The rubber stamp House of Representatives gave him what he wished as a demonstration of blind loyalty never seen before in recent history. Yes, it was a “sayonara” vote to the tweet-happy Orangeman gurgling under an ocean of criticism. And with a shortness of breath, Trump relayed the House vote to his favorite lapdog, Senate Majority Leader Mitch McConnell, and told him, “Okay my boy, give me victory. And don’t screw it this time or I’ll send you down Mexico Lane.”

“But we don’t have the vote, Mr. President,” Mitch said. “What are you talking about? You have more than the 51 majority vote!” Trump yelled. “Well, we need 60 votes to end the filibuster the Dems will surely do,” Mitch said. “Fili… blister? What the heck is that?” Trump wondered. “Never mind. I’ll shut down the government.” And so he did.

Negotiated compromise

After 35 days of government shutdown, Trump agreed to reopen the government for 21 days without the wall funding. But he expected the $5.7-billion wall funding or he’d declare national emergency.

The Dems and Reps negotiated a compromise bill to provide funding to avert a government shutdown that includes $1.375 billion to build a 55-mile “barrier.” It’s interesting to note that the word “wall” was never mentioned. They either called it a “fence” or a “barrier.”

The votes from both chambers were veto-proof -- the Senate by an 83-16 vote and the House by a 300-128 vote. Both chambers have more than the 2/3 votes needed to override a presidential veto.

The $1.375-billion funding for a barrier was a far cry from the $5.7 billion that Trump demanded. But he vowed to declare a national emergency so he could pirate funds from other budget items to finish his wall. But Trump – as always -- claimed victory, saying, “The $1.375 billion was a heck of a lot better than the one dollar Nancy offered me.” It’s funny that Trump didn’t get Nancy’s one-dollar joke.

Well, it looks like the Fox is up to something that could put him in an embarrassing situation again. Should Trump proceed with his “national emergency” gimmickry, he should have enough cushions – perhaps a tarpaulin -- to fall into if the Supreme Court justices turn their backs on him.

“The ball is round”

With two battles on government shutdown and border-wall funding lost, the Fox is ready for another fight – national emergency. But what is “national emergency” exactly? “The National Emergencies Act of 1976 authorizes the President to declare emergencies, thus unlocking certain provisions, when the country is ‘threatened by crisis, exigency or emergency circumstances’ other than wars or natural disasters,” the Congressional Research Services (CRS) explained. And where does the money come from? “Congressional aides say there is $21 billion in military construction money that could potentially be used by Trump if he declares a national emergency. But according to the law the money has to be used in support of U.S. armed forces,” the sources said.

Meanwhile, the Defense Department declined to provide details on available money. Well, it looks like Trump may have to get the support of his two Supreme Court appointees and the other three conservatives. That’s five -– a majority vote. But what if Chief Justice Roberts swings to the left again as he had done in a most unexpected time? Like they say in basketball, “The ball is round.” But can the Fox afford to lose another battle?

In the last few weeks, the Fox had a rude awakening and finally realized that the Democrats’ reemergence as the new power bloc in the House and has the ability to block legislation in the Senate with Democratic senators’ filibustering power. And with the highly experienced Speaker Nancy Pelosi at the helm in the House, the Republicans have a hard time figuring what the den mother’s next move would be.

Trump’s Waterloo

Trump’s obsession with a border wall could precipitate his downfall. He’s heading to his Waterloo in 2020 by battling with the establishment on the legality of his declaration of national emergency and other misadventures that he’d get himself into. The American people are beginning to see the nincompoopery in the Fox whose thousands of lies would eventually come down on him like a wrecking ball. And before he’d know it, his political life is blown to smithereens and cast into the gray mist forming over the Potomac by the White House.

And such would be the fate of the wily Fox, who, by the sleight of hand, had reached the apex of power on his first try in politics. Some say he was lucky. Some say he cheated. Some say he was a slick politician. Some say the Russians helped him win the election. And now a special prosecutor is turning every stone in his past, which could reveal the mystery behind the Fox.

The Fox

Last February 15, 2019, the Fox announced his declaration of national emergency to build a border wall to fulfill his pledge to construct a wall along the U.S.-Mexico border. By doing so, he bypassed Congress, which approved only $1.375 billion to build a 55-mile fence along the border. He said it would cost about $8 billion, so he’d combine the $1.375 billion Congress approved and $6.625 billion he’d take from the military construction fund.

Anticipating that he’d be sued for raiding the military construction fund, he said that he’d lose in the lower and appellate courts. But once it reaches the Supreme Court, he expects to win the case. He seems to believe that the five-member conservative bloc in the High Court would support him without batting an eye. Four might momentarily ignore their sacred duty to protect the constitution and uphold the rule of law, but he can’t rely on Chief Justice Roberts who many believe has filled the vacuum left by retired Justice Anthony Kennedy, the court’s swing voter for many years.

Indeed, Trump is putting all his political chips on his “national emergency” gamble, which he believes is the key to winning his re-election bid in 2020. If he fails to get the Supreme Court nod, he just might as well kiss the presidency good-bye. If he prevails in his Supreme Court gambit, he still has to face Special Prosecutor Robert Mueller who has been building several cases against Trump and his family members.

At this point nobody knows how strong the cases are. They could be used to impeach Trump or wait until he has steps down and then slap him with criminal charges. But there have been rumors floating around that he’d resign provided that all charges against him and his family members are dropped. That would be the easy way out. But Trump has been known for making crazy and bold decisions. He just might try to do – for the last time – one of his political triple somersaults to entertain his base for the last time.

Finally, Speaker Nancy Pelosi, the indomitable Den Mother of the House Democrats has outfoxed the Fox. Has she?

(PerryDiaz@gmail.com)

PerryScope: China's quest for world dominion

PerryScope
By Perry Diaz

With the recent participation of the Philippines in China’s “One Belt, One Road” (OBOR) Initiative last November 2018, one doesn’t fail to wonder: Will it be good for the Philippines or will it fall into China’s “debt-trap diplomacy” as almost all of the 70 countries that participated and ended up gurgling under an ocean of indebtedness?

To answer the question, one needs to look at what happened to those who participated to date. For lack of space, we can’t cover them all but here are some that’s worth looking at.

It begins with “soft-power diplomacy” where China persuades or attracts other countries to join her OBOR Initiative. She began using soft-power diplomacy in the 2000s. But it was Chinese President Xi Jinping who put it to work when he assumed office in 2012.

Xi began a worldwide campaign to sell soft power to other countries, particularly the poor and developing countries that were easy bait to promises of economic progress. Like the 19th century snake oil salesman, Xi tried to sell a product that works like magic. He also started selling the OBOR Initiative, a new Silk Road that would connect -- by land and by sea -- Asia, Middle East, Africa, and Western Europe. OBOR would entail building roads, railway systems, seaports, and other infrastructure. Amazingly, they sold!

But what the participating countries didn’t realize was they’re falling into China’s “debt trap.” It lures poorer countries by offering “cheap loans” for infrastructure projects. But it involves certain conditions that greatly favor China, to wit: no bidding process, project to be done by one of China’s state-owned companies, the workers to be Chinese nationals, cost overruns to be renegotiated (that usually ends in higher interest rates), high-value collaterrals, and contract disputes to be arbitrated in China under Chinese laws.

One of the early participants was Sri Lanka. The first project was the Hambantota Port, which initially cost $1.12 billion to build. Other projects followed until Sri Lanka ended up owing a $13-billion debt to Chinese state-owned banks. Pretty soon, she couldn’t repay the loans.

Hardball Diplomacy

That’s when China applied “hardball diplomacy,” which demanded economic or political concessions in exchange for debt relief. Sri Lanka was forced to lease the port and 15,000 acres of land around it for a period of 99 years.

Sri Lanka was not the only one who fell into China’s “debt-trap diplomacy.” A recent report said that at least 16 countries are vulnerable to China's economic coercion, including Kenya, Pakistan, Zambia, Djibouti, Cambodia, Laos, Thailand, Malaysia, Myanmar, Tonga, Micronesia, Vanatu, and the Philippines.

Another project that would soon follow the fate of Sri Lanka is Kenya. If Kenya fails to begin repayment of a $2.3 billion loan for Kenya Railways Corporation (KRC), China would seize the Kilindini Harbor, the biggest port in East Africa, which was the collateral for the Chinese loan. 

The massive construction loan was the result of Kenya participating in OBOR. But the problem was that the feasibility studies were performed by China, which might have estimated high revenue to be able to service the loan. This led to fears of Kenya’s ability to repay the loans, which would trigger the seizure of the collateral. Should there be any dispute with the Chinese bank, it would be handled through an arbitration process in China, not in Kenyan courts.

One of the earlier OBOR projects China had were the Gwadar Port in Pakistan and the China-Pakistan Economic Corridor (CPEC) that connects the landlocked western China to the Indian Ocean. It was reported that Pakistan’s debt liabilities have risen from $83 billion to $88.9 billion in 2017. It was also reported that Pakistan’s debt would balloon to $100 billion by 2024 of the total investment of $18.5 billion. The interest on the bank loans is around 7% per annum payable in 25 to 40 years, which cost Pakistan around $8 billion per month.

Neocolonialism

But what is interesting to note is that China has gained a military footprint in Pakistan, which she can use to counter the presence of the U.S. in the Indian Ocean and Arabian Sea. China could also use Gwadar to refuel her submarine fleet; thus, extending her navy’s global reach beyond the South China Sea. And in time of conflict with the U.S. or India, China would have the ability to block the chokepoint at the Strait of Malacca; thus, cutting off the huge U.S. naval forces in the Pacific from getting into the Indian Ocean and Arabian Sea.

In 2015, China passed a new national security law that provided a legal basis for China to deploy military forces abroad to safeguard her infrastructure projects and Chinese expatriates who were working at these projects in Africa under China’s OBOR Initiative. China also published her second Africa policy paper, stating that she would strengthen military exchanges and cooperation such as carrying out joint military training and exercises, as well as helping African countries to “enhance their capacity building in national defense and peacekeeping.”

With control over seaports in Pakistan, Sri Lanka, Kenya, Djibouti, and Myanmar, China would be able to encircle the U.S. strategic base on Diego Garcia in the middle of the Indian Ocean.

In 2018, China released an action plan for 2019 to 2021, following the Beijing Summit of Forum on China-Africa Cooperation (FOCAC). The plan called for “stepping up OBOR security cooperation with particular focus on railways, industrial parks, and major events,” as well as protecting Chinese nationals and Chinese companies, which makes one wonder: Is this China’s blueprint for neocolonialism in Africa?

New Cold War

With that as the backdrop, a new Cold War has begun in the Indian Ocean with the informal alliance of the U.S., India, Australia, and Japan (known as the quadrilateral alliance) against China. The stakes are high. More than 60% of the world’s oil shipments pass through the Indian Ocean, mainly from the Middle East and East Africa’s oil fields that are bound for China, Japan and other fuel-importing Asian economies. In addition, 70% of all container traffic passes through the Strait of Malacca, which China would attempt to block in the event of conflict with the quadrilateral alliance.

It’s now evident that China’s OBOR Initiative is a creative way to achieve global military power… without firing a shot. Indeed it is a dream comes true.

In 1405 when the Ming Dynasty’s Emperor Yung Le (Zhu Di) ordered a massive “Treasure Fleet” of 200-300 ships with 28,000 men to sea on the “Western Ocean” (Indian Ocean). He dreamt of ruling the seas. Yung Lo also claimed the island of Lusong (now Luzon of the Philippines) and placed it under his empire.

When Yung Lo died in 1424, his successor Emperor Hongxi didn’t share his father’s dream. He lost interest in Lusong and dissolved the colonial government. He then banned the famous Admiral Zheng He’s naval voyages. Hongxi died a month later in 1425. In the next six centuries, China had no navy and anyone caught even sailing on the high seas was summarily put to death. Not anymore.

In my column, “Has Chinese colonization begun?” (November 16, 2018), I wrote: “With historical incidents of Chinese colonization of Luzon, and the present-day massive arrival of Chinese nationals assimilating into the various industries in the country, many are concerned that they would soon control the wealth and patrimony of the nation.

“Just like 600 years ago when China claimed and placed Luzon under her empire, is she now in a position to claim the Philippines as her province or vassal state? Has Chinese colonization begun?”

Today, China is sailing again in an attempt to rule the seas… and the world. The question is: Will “Emperor” Xi Jinping succeed where Emperor Yung Lo failed in his quest for world dominion?

(PerryDiaz@gmail.com)

PerryScope: Chinese ‘invasion’ of the Philippines

PerryScope
By Perry Diaz

Typically, when a foreign power invades another country, they’re met with resistance that could lead to war. But something unusual is happening in the Philippines -- thousands of Chinese workers are invading the country and taking jobs away from Filipinos. However, Malacañang is not worried about it. In fact, they welcome it.

Recently, the Senate Labor, Employment, and Human Resources Committee conducted an inquiry on the influx of foreign workers in the Philippines. It was revealed that the Department of Labor and Employment (DOLE) issued almost 52,000 alien employment permits for Chinese workers. According to DOLE officials, more than 150,000 Chinese enter the country using tourist visas before getting short-term permits to work for online gaming firms. The Senate committee also found out that more than 119,000 tourists -- mostly Chinese -- were able to avoid Philippine labor regulations. Current estimates place 200,000 to 400,000 Chinese are working in Philippine Offshore Gaming Operations (POGOs), which were established after President Rodrigo Duterte took over the government in 2016. Currently, there are around 50 POGOs in operation today, mostly operated by Chinese nationals.

But what’s causing the ease for foreigners to acquire work permits is a glaring loophole in the DOLE system where any of the 3.12 million Chinese “tourists” registered at the Bureau of Immigration (BOI) can convert their tourist visas into working visas as long as they obtain an Alien Employment Permit (AEP). And while waiting for their AEP, they are issued a Provisional Work Permit (PWP). So, in a practical sense, any tourist admitted to the country can stay and work without too much of a hassle.

As one resident in Metro Manila had observed: “The Chinese have invaded our islands in the West Philippine Sea and now they’re in my condo! It’s a home invasion!”

“Build, Build, Build”

Well, POGOs are just one industry that is employing a large number of Chinese nationals. The bigger industry, which is growing fast, is the “Build, Build, Build” infrastructure project of President Duterte, which is estimated at US$180 billion. What we’re talking about here are construction workers -- tens of thousands -- employed by Chinese state-owned contractors.

All the contracts that the Philippines had agreed to undertake with Chinese bank loan financing, the following conditions are included: No bidding process, project to be done by one of China’s state-owned companies, the workers to be Chinese nationals, cost overruns to be renegotiated (that usually ends in higher interest rates), and others including asset-based lending practices.

What is interesting to note is that the Chinese contractors who got the no-bid contracts, hire Chinese nationals, transport them to construction sites, provide housing and meals, and pay them according to China’s pay standards, which are much higher than Philippine pay standards. I n essence, Duterte’s infrastructure project does not increase the country’s construction employment opportunities.

There were reports that the Chinese workers are paid on the average P3,000 a day while Filipino construction workers are paid on the average P600 a day, which would definitely cause resentment and outrage.

One has to remember that the Chinese construction companies will only hire Chinese construction workers as per contract condition. The pay is already built-in to the cost of construction. But here’s the sad part: The Philippine government is paying for the cost of construction plus whatever profit, overhead, housing allowances for the Chinese workers, and other costs are added to the total contract amount. The question is: Would it cost less to hire Filipino construction workers? Absolutely. But then these are the conditions the Chinese government imposed on the countries that were enticed into infrastructure projects with high-interest predatory loans from Chinese banks chosen by the Chinese government.

To entice Chinese workers to work in the Philippines, they have to be paid comparably or more than what they earn in China. After all, it didn’t matter to the Chinese construction companies because the extra cost of labor would be added to the total construction cost, which is paid by the host country, the Philippines.

But what’s happening to Chinese construction projects in the Philippines is also happening in all the countries where China is building infrastructure projects, including 35 seaports around the world. To date, 16 countries are vulnerable to China's “debt-trap diplomacy" and economic coercion, including Vanuatu, the Philippines, Cambodia, Laos, Thailand, Malaysia, Sri Lanka, Tonga and Micronesia.

Ghost cities

Three decades ago when China’s export market increased in volume, China embarked on a massive project; building high rise housing projects in newly created cities in anticipation of the growing middle class. Well, they over-built hundreds of them in what are now called “ghost cities.” Some say that they were built on purpose knowing that the growing middle would buy the hundreds of thousands of units built. Economic experts said that by expanding the construction industry, millions of construction jobs were created in the 1990s and 2000. It also caused China’s GDP to grow year after year. But like anything else, good things come to an end sooner or later. When the construction bubble finally burst, China had to find ways to put her construction and infrastructure workers in new projects. And with not enough domestic projects to work on, well…. where else would they go?

One Belt, One Road

When Chinese President Xi Jinping came to power, he dreamed of China becoming a superpower. But he couldn’t dislodge America from her perch as the world’s sole superpower. His “China Dream” took shape with his “Soft power diplomacy,” which is to gain economic power as a first step to becoming a superpower.

Xi then embarked on a “soft-power diplomacy” to sell China’s infrastructure projects to other countries. That’s when his “One Belt, One Road” (OBOR) Initiative came to fruition. He envisioned OBOR as the new Silk Road connecting Asia and the Western World by land and by sea. To date, China has built 35 seaports around the world creating sea routes -- called “String of Pearls” -- from the East and South China Seas to the Indian Ocean to Africa and Western Europe. Recently, China was trying to take over the Hanjin Philippines operations at Subic Bay, the former U.S. naval base.

Last November 2018, Xi visited the Philippines for the first time and sealed 29 infrastructure projects with Duterte. It opened to doors for Chinese workers to come to the Philippines, since the “Build, Build, Build” projects were designed to be funded by Chinese banks and utilize Chinese contractors and workers only.

But things don’t seem to be what they should be. And the biggest problem that’s looming in the horizon is China’s OBOR Initiative itself. After pouring trillions of dollars into these grandiose infrastructure projects, participants are beginning to worry that OBOR is China’s thinly disguised strategy to expand her influence over countries from Asia to Western Europe. Instead of signing up to make deals with China, many countries are now beginning to stay away from doing business with her. But how about the 16 countries that have already been entrapped in China’s debt-trap diplomacy? Do they have a way out? Or would they suffer the fate of Sri Lanka, shackled in debt and her patrimony collateralized?

Which begs the question: Could China’s miscalculation of her OBOR Initiative would cause her construction industry to crash and open the floodgates to Chinese “invasion” of the Philippines and other countries?

(PerryDiaz@gmail.com)