FACT CHECK: Viral FB posts make inaccurate claims on Lopez family

Vera Files

Posted at Sep 08 2020 04:37 AM

Chairman Emeritus Eugenio Lopez III (left) and Chairman Mark Lopez during a stockholders' meeting of ABS-CBN in Quezon City. Fernando G. Sepe Jr., ABS-CBN News/File

MANILA - Widely circulating among social media users since May are inaccurate Facebook posts accusing the affluent Lopez family of "fooling the Filipinos for 34 years." Of the seven claims related to the Lopezes and their history, two are downright false, four need further context, and one is unfounded.

STATEMENT

On May 6, just a day after Lopez-owned media giant ABS-CBN went off-air due to its expired broadcast franchise -- which Congress refused to renew -- a number of netizens on FB published identical posts entitled “MAS LAMANG ANG MAY ALAM (knowledgeable [people] are at an advantage).” The posts supposedly provide information about the Lopez clan, which the text referred to as a “powerful oligarch[y] that controls the Philippines.”

Using the generic acronym “ctto" -- or “credit to the owner” -- as an attempt to cite the source of information, the posts made the following claims:

  • the Lopezes own a lot of companies, including electric power distributor Manila Electric Company or Meralco;
  • the Lopezes launched “a variety of black propaganda” attacks against former President Diosdado Macapagal that led to the downfall of his administration;
  • the Lopezes used to be “close” with the late dictator and former President Ferdinand Marcos Sr. However, the relationship soured when Marcos later wanted the government to get “40 percent of the tax” the Lopezes were paying, but the family insisted on giving 15 percent only “due to the numerous companies they own;”
  • the Lopezes “launched a number of black propaganda attacks against Marcos through the media,” which caused the former president to “shut ABS-CBN down;”
  • the government, during Marcos’ time, “saved” Meralco after the Lopezes “asked the government for help” when the company was in distress;
  • the Lopezes conspired with opposition leaders Ninoy and Cory Aquino in order to fulfill their plan of “overthrowing” the Marcos administration;

and, the Lopezes reclaimed ABS-CBN and Meralco "for free" during the Cory Aquino administration.

Social media tool CrowdTangle shows around 1,600 reposts and reshares by FB pages and in public FB groups carrying the claims, collectively gaining over 400,000 interactions from netizens to date.

FACT

The claims that the conflict between the Lopezes and Marcos was due to tax issues, and that former President Corazon “Cory” Aquino returned to the Lopezes their properties “for free” post-martial law are both erroneous.

The claims that the Lopezes “own” Meralco, that they launched black propaganda against Macapagal to topple his administration, that they asked the Marcos government to help save Meralco, and that they conspired with the Aquino couple to oust the dictator all need context.

Lastly, the claim that the Lopezes used the media to spread black propaganda against Marcos -- causing the late dictator to close ABS-CBN down -- is unsubstantiated.

On ‘owning’ Meralco

To say that the Lopezes “own” Meralco is inaccurate. The Lopez-owned First Philippine Holdings Corporation now has only a minority share of 3.94 percent in Meralco.

Beacon Electric Asset Holdings, Inc., a subsidiary of a corporation owned by tycoon and Meralco Chairman Manuel V. Pangilinan, holds the largest chunk -- or 34.96 percent -- of the electricity company’s shares.

Beacon’s parent company, Metro Pacific Investments Corporation, owns an additional 10.5 percent and is Meralco’s third-largest shareholder. Second with 29.56 percent of shares is JG Summit Holdings, Inc. of the late billionaire businessman John Gokongwei Jr.

In 1961, Eugenio Lopez Sr. led a group of Filipino entrepreneurs and bought Meralco, making it “the first major American enterprise to be so 'Filipinized’,” according to the company’s website.

However in 2009, in what Oscar Lopez -- son of Lopez Sr. -- described as a “necessary business decision,” the family sold 20 percent of their shares in Meralco to the Pangilinan-led Philippine Long Distance Telephone Co. (PLDT) Group.

This diminished the Lopezes’ shares in the electric company to a mere 13 percent, making Pangilinan’s Group the single largest shareholder of Meralco, with an estimated 30 percent of shares during that time.

Three years later, former Ambassador to Japan Manuel Lopez, then Meralco chairman, transferred his chairmanship of the company to Pangilinan, finally marking the end of the Lopez leadership in the country’s major power distributor.

On attacking President Macapagal with black propaganda
In her article on kinship politics in the Philippines after World War II, historian Mina Roces wrote that Macapagal, in a supposed attempt to dismantle deep-rooted influence of elite families in politics that use their “political power to build business empires,” launched a “major attack” on the Lopezes and their business allies during his four-year term.

The president’s “assaults” and “tirades” put the Lopezes “on the defensive and blunted their efforts to succeed in business,” even pushing them to sell two of their corporations and two sugar mills, according to Roces’ article titled “Kinship Politics in Post-War Philippines: The Lopez Family,” published in 2000 in the Modern Asian Studies journal of Cambridge University in the United Kingdom.

During the campaign period leading to the 1965 national elections, the Lopez-owned newspaper, The Manila Chronicle, published daily reports on the Marcos-Lopez campaign while “continuously and ruthlessly attack[ing]” Macapagal, who was then seeking reelection, the article said. The Nacionalista Party tandem eventually won the elections.

There is no clear evidence that the Lopezes engaged in “black propaganda” to defeat Macapagal.

Black propaganda, as defined by American sociologist Howard Becker in his 1949 article titled “The Nature and Consequences of Black Propaganda,” deals with propaganda disguised by the propagandizer -- in this case the Marcos-Lopez duo -- as coming from “a source inside the propagandized,” who is Macapagal.

While the accounts of Roces and Richard Butwell, a scholar on politics in Southeast Asian countries, show there was mudslinging from both camps during the campaign, there was no indication that the Marcos-Lopez tandem launched its attacks from inside Macapagal's camp.

On the conflict between the Lopezes and Marcos due to tax issues
The conflict between the Lopezes and Marcos was due to the ownership of a lubricating oil facility — not taxes — from which the president demanded a 40 percent share, a proposition the Lopezes rejected by offering 15 percent to the president instead.

Historian Joseph Paul Scalice, in his 2017 dissertation on Marcos’ military rule, discussed the tension between the two parties during the 1970 economic crisis:

“The business interests of the Lopez family felt the impact of rising prices and they sought relief from the Marcos government; Marcos in turn sought a larger share of ownership in a lubricating oil facility the Lopez brothers were intending to buy. In exchange for approving the deal he asked for forty percent ownership, but the Lopez brothers insisted on fifteen percent.”

This rejection resulted in an “open political conflict” between Marcos and the Lopezes during the first quarter of that year, Scalice said. The president later raised the import tax on crude oil, significantly increasing the operating costs of then Lopez-owned Meralco.

The lubricating oil factory mentioned in the dissertation, the Philippine Petroleum Corporation, was “the country’s first lubricating oil base stock refiner,” set up in September 1969 by the Lopezes. It was bought by Pilipinas Shell Petroleum Corporation in the mid-1980s.

On the Lopezes’ ‘black propaganda’ against Marcos and the shutting down of ABS-CBN

The Marcos-Lopez tandem had a “falling out” following the 1969 elections, according to Scalice’s dissertation.

A 1975 New York Times report said the president then felt he would “never be able to consolidate his power” due to the Lopezes’ influence, while the latter “believed...their wealth and power would be threatened” if Marcos was able to keep his position.

Then-Vice President Fernando Lopez, along with other “ruling elites,” financed protest movements, which sought Marcos’ ouster “through a variety of means,” Scalice said.

Historian and activist Renato Constantino, a columnist of the Lopez-owned Manila Chronicle, wrote anti-Marcos pieces. However, Scalice said Constantino’s columns were “not a political exposé,” since a number of the Philippine news media at the time already sang an anti-Marcos tune.

Since the charges leveled by the Lopez camp against Marcos did not come from inside the then president's camp, these do not fit the definition of black propaganda.

The shutdown of ABS-CBN during the military rule was also not an isolated case. Marcos’ Letter of Instruction No. 1, issued after he declared martial law in 1972, ordered state forces to “take over and control” all privately-owned media entities, including ABS-CBN, to prevent them from being used “for propaganda purposes against the government.”

On Marcos saving the Lopezes and Meralco

The increase in import tax on crude oil imposed by Marcos in December 1970 led to the significant rise in operating costs for Meralco, which again escalated the conflict between the president and the Lopezes.

Writer and historian Raul Rodrigo, as cited by Scalice in his research, said by 1971, the company acquired a “large dollar-denominated debt” too difficult to pay that the “only way” for the company to survive is by “secur[ing] a rate increase” from the government — especially since an additional P1 billion was also needed for a planned expansion of Meralco in the next seven years.

In May 1972, the Public Service Commission granted Meralco a rate increase of 36.5 percent, which led the two camps to reconcile temporarily — with Marcos even meeting with the Lopezes to shake their hands, Scalice wrote.

However, Marcos declared martial law four months later and put Eugenio “Geny” Lopez Jr., another son of Lopez Sr., behind bars for his alleged hand in a plot to assassinate the president.

On the Lopezes conspiring with Ninoy and Cory Aquino to topple the Marcos administration

Former President Cory Aquino, whom Marcos himself described as a “mere housewife,” entered the political arena only during the snap presidential elections, three years after her husband Ninoy -- Marcos’ archnemesis -- was assassinated upon his return to the country from exile in August 1983.

Cory ran as the opposition’s standard bearer but lost in the 1986 elections, marred with “massive poll fraud and rampant cheating.” Her defeat eventually led to the country’s first People Power that saw the downfall of the Marcos dictatorship.

Political science expert Mark Thompson, as cited by Scalice, said “five major factions” — the Aquino, Laurel, Osmeña, Roxas, and Lopez families — “came into alignment” to oppose Marcos between 1970 and 1972.

The “allied elite opposition” funded protests to “destabilize Marcos” and helped “plan, pay for, and give favorable press coverage to the rallies,” among others, the account said.

After the president put the country under martial rule in September 1972, the anti-Marcos rallies were stopped. However, select members of different political groups -- including the Liberal Party, National Union for Liberation, and Nacionalista Party -- made their own alliance to oppose the dictatorship, according to a 1981 article published in the Asian Survey journal of the University of California.

On President Aquino returning ABS-CBN and Meralco to the Lopezes ‘for free’

According to Roces, columnist Hilarion Henares Jr. of the Philippine Daily Inquirer “exposed” in a July 1988 article the underpriced transfer of Meralco shares to the Lopezes, with some of the shares returned “with absolutely no cash outlay” from the Lopez family.

The exposé pushed the Aquino administration to call the transaction off, causing the Lopezes “to share a good portion of their profits with the government,” Roces said.

Columnist Federico D. Pascual Jr. of The Philippine Star, in a 2002 article, similarly said the Lopezes got back “some -- not all” of their assets in Meralco post-martial law, after having sold it for a mere P10,000 to a dummy foundation of the Marcoses in 1973.

In a 2008 ABS-CBN report, former finance secretary and then-ambassador to the United Kingdom Edgardo Espiritu said a review committee was formed by the Aquino government to deliberate on how Meralco would be returned to the Lopezes. Espiritu, who served as chair of the review committee, said the family paid “an extra P2 billion on top of its earlier payments” to reclaim some shares in Meralco.

As for ABS-CBN, the Lopez camp insisted that the family never lost its ownership of the media organization.

In January 1987, ABS-CBN entered into an “Agreement to Arbitrate” with the Aquino administration after the media company asked the government, through former Sen. Lorenzo Tañada, for the return of its television and radio stations.

The Supreme Court upheld the validity of the agreement two years later, in a decision that dismissed a petition requesting its annulment.

These accounts were reiterated during the June 15 House committee hearing on the renewal of the media giant’s legislative franchise, where ABS-CBN’s counsel Arecio Rendor Jr. said the network “was never sold nor was [its ownership] ever transferred,” even during Marcos’ martial rule.

This claim was supported by Justice Assistant Secretary Nicholas Ty and Presidential Commission on Good Government (PCGG) Commissioner John Agbayani, who were both invited as resource persons in the same hearing.

Rendor said ABS-CBN’s return to the Lopezes after the military rule was approved by the Office of the President, the PCGG, and the Board of Arbitrators, and was upheld by the Regional Trial Court and the Supreme Court.