Resignifying Good Governance in the Philippines

Why, in their concern for the Philippines’ social and economic problems, do politicians and researchers from the center to the left obsess over national debt and caution against spending? Frustrated by his country’s political options and faced with this puzzle, Lisandro Claudio asks, how did austerity—as in, policies aimed at keeping debt and spending low through high interest rates and an expensive and restrictive currency—transform from a colonial ideology to an assertion of anticolonial nationalism? Claudio traces the discourse of austerity by analyzing moments of economic crisis in the Philippines. Dissecting orthodox accounts and offering alternative explanations from heterodox economic thinkers, the book offers a biting critique of austerity as the favored solution to the Philippines’ economic problems. Without a doubt, Philippinists, historians of empire and foreign relations, and economic historians have much to gain from Claudio’s carefully crafted account. The story begins in the colonial period when the Philippines “contracted” the idea that monetary austerity was the good, moral, and manly form of governance. Republican and imperialist officials and experts cast the Spanish system, and later Filipinos and Democrat colonial officials, as wasteful and responsible for economic crises. Republican colonial officials favored an import-consumer economy and a dear money policy based in gold. They believed that limiting spending would control potentially reckless and corrupt colonial politicians. As a consequence of restricting the money supply, however, austerity’s advocates stifled both Philippine development and the possibility of an industrial working class.