The government had borrowed heavily for development programs on the assumption that exportearnings and other revenues would finance debt repayment.a.
But export revenues did not improve as much as expected. The rising cost of importswas not offset by the value of such a narrow export base (sugar, coconut, and forestry products), which was subject to the fluctuation of global commodity markets.2.
Other sources of government revenue went untapped. From 1959 to 1968, Congress passed notax legislation at all, despite significant structural changes in the economy.3.
American development assistance declined in the late 1960s ± from $190 million in 1968 to $144million in 1969.4.
Foreign investment plunged fro $20 million to $8 million as the international community becamewary of corruption and inefficiency.The president had lost much of his original panache and was confronted by growing criticism from political opponents and even the hitherto tolerant middle class. Nevertheless, in 1969 Marcos became thefirst Philippine president to win reelection.Second Term (1969-1972)Marcos¶ reelection plunged the country into crisis.1.
The unprecedented government deficit of more than one billion pesos forced Marcos to float thecurrency in early 1970. A sense of unease spread in urban areas as the m idle class feared aneconomic tailspin.2.
Social and political activism became much more urgent and student protest on Manila campusesgrew in frequency and intensity.3.
Activism addressing national and social themes also emerged within the Catholic Church whose political influence had grown with its anticommunist offensive of the 1950s.4.
After almost a decade of silence, the Partido Komunista ng Pilipinas (PKP) renewed organizingfor parliamentary struggle. With its peasant and worker base still recovering from the Huk debacle, the party recruited students at the UP and the Lyceum of Manila who were alreadyattracted to Marxism.5.
It was also a time of unabashed opportunism. Radical propaganda got a great boost whenMarcos¶ discarded allies, notably the Lopez and Laurel families, sensing that he was faltering,announced their sympathy with the ³revolution´ and opened their media outlets to studentradicals.6.
The intensification of political battles outside the state was paralleled by escalating combatwithin. Anti-Marcos delegates to the 1971 Constitutional Convention planned to prevent him (or any immediate family member) from seeking another term. In Congress, the opposition regaineda majority after key Nacionalistas withdrew their support and a Communist bombing of a Liberal party rally in August 1971 was popularly attributed to Marcos.The ³US-Marcos Dictatorship´The declaration of martial law devastated Marcos¶ opponents.1.
Overnight the entire network of anti-Marcos forces had disappeared from the public arena.Politicians were jailed, their patronage machines adrift, and private armies demobilized.2.
Students, academics, journalists, businessmen, and labor and peasant organizers had also beenarrested.