The Philippine Migration Machine

The Philippines is a Cacique Democracy, a term originally coined by Benedict Anderson to describe the
feudalistic political system of the country, where wealthy land-owning elites, such as the Acquino and
Cojuangco families, have maintained their chokehold on political and economic power since the American
colonisation era. It was estimated in 1992 that 145 out of 200 members of Congress hail from Cacique
families. These elite politicians have kept the Philippine migration machine well-oiled and running hot ever
since the policy of labor export was formally instituted by Ferdinand Marcos in the 1970s.
Given the dominance of agricultural sectors by the very same families in
charge of the Philippines’s future, it should come as little surprise that the
nation’s economic development significantly lags that of its Asian peers. In
2015, the World Bank estimates more than one-fifth of Filipinos live below
the national poverty line. The reason, as alluded to earlier, is the elite
government’s personal economic interests. To maximise returns on their
land and agricultural business assets, Cacique families need a steady pool
of poor, lowly educated Filipinos to plant coconut trees and harvest
pineapples for export.
Viewed from this lens, it becomes clear that the government has a powerful incentive to slow the nation’s
transition from an agricultural based economy to one based on advanced manufacturing. Such a structural
shift would substantially devalue their personal landholdings; factories require expensive machinery, but
not that much land space. One of the most crucial tools for the government to achieve its stranglehold on
the economic transition, is the Philippine migration machine. What started out as an act of political
desperation to provide jobs to hungry Filipinos in the 1970s, has mutated into an insidious policy that only
worsens the government’s incentive problem.
A government that fails to deliver progress, or at least the appearance of progress, will eventually be
ousted by its people. The migration machine creates a cycle of marginal improvement, generation by
generation, that has served up sufficient “progress” to keep Filipinos sufficiently satiated for decades. Low
income families send their English-speaking members abroad in hopes of higher wages than they can get
working in the domestic agricultural or labor intensive manufacturing sectors. University undergraduates
from middle income families, unable to find jobs they were trained for, seek better paying but lower skilled
jobs overseas. Many Filipino doctors switch to become nurses to find employment outside the Philippines;
an atrocious waste of resources. Migrants send these higher wages back to their families, who spend on
consumption and invest in their children’s education and health, trusting in a better economy and job
market tomorrow. Yet with only meagre structural progress, the continued scarcity of quality jobs pushes
each consecutive generation beyond the nation’s borders, and the cycle repeats.
The problem is that most Filipino families see an increased quality of life due to migration. Migrants live
and work in developed countries with better social and physical infrastructures, while remittance receiving
members can afford better food, education and healthcare at home. This in effect, exacerbates the
government’s misaligned incentive to avoid true economic structural progress. They fear no revolt from
the people whose lives grow just slightly better with each passing year.
Magnifying the strength of the government’s stranglehold on economic progress, is its failure to build an
inclusive financial system. According to the Bangko Sentral ng Pilipinas, 77% of Filipino adults are still
unbanked in 2017. The Filipino migrant population are unable to invest their painstakingly earned
remittances into much needed infrastructure and private enterprises. Financial investments are a key
benefit that justifies the costs of a migration policy in the first place. As a policy that fails to fulfil its most
pertinent promises, the migration machine has allowed the Philippines’s elite to rob its people blind.