Lessons from People’s 2000 for the Philippines’ Current Crisis
By Joey Sarte Salceda
Institute for Risk and Strategic Studies, Inc.
The flood control scandal has triggered a rapid collapse of trust in public institutions. Allegations of corruption, ghost projects, and substandard construction have engulfed the Department of Public Works and Highways, implicating contractors, engineers, and lawmakers alike. The scale is staggering. By September 2025, a Publicus Asia survey found that the DPWH’s approval rating had collapsed to 12 percent (down from 33 % in the previous quarter), with trust falling to just 8 %.
Yet the speed of this institutional unraveling, while alarming, should not obscure the deeper driver of public frustration: the economy. Wages remain stagnant, food prices stubbornly high, and the perception that government is disconnected from household realities has crystallized into political anger. When governance credibility and economic confidence collapse simultaneously, the result is a system that is both unstable and stagnant, volatile in its politics yet paralyzed in its capacity to act.
The reaction to the DTI’s claim that P500 was sufficient for a family’s Noche Buena dinner made this painfully clear. Lawmakers across the political spectrum denounced the estimate as “insulting” and “tone-deaf.” The issue was not merely the arithmetic, which the DTI doubled down on as being correct. It was the sense that official messaging had become detached from the lived experience of ordinary Filipinos. For many families, the statement confirmed a larger fear: that economic policy signals are no longer grounded in actual market conditions.
This is why the political moment feels stalled. To borrow the phrase that James Carville made famous during Bill Clinton’s 1992 campaign (a phrase he posted in campaign headquarters to keep staff focused on what mattered most), the central issue today remains straightforward: it’s the economy, stupid. Here in the Institute for Risk and Strategic Studies, we believe that it’s still all about the economy.
The Economic Picture
The Philippine economy is not in freefall, but it is losing altitude at a worrying moment. GDP growth slowed to 4 % in the third quarter of 2025, the weakest since the COVID-19 lockdowns. The Asian Development Bank projects full-year growth of 5.6 %, while AMRO forecasts 5.2%.Both figures fall below the government’s target of 5.5% to 6.5%. S&P Global Ratings has cut its estimate to just 4.8%, citing the flood control scandal, public protests, and their dampening effect on capital inflows.
The slowdown has compounded political turmoil. President Marcos Jr.’s trust rating fell to 25% in a March 2025 Pulse Asia survey, a dramatic 17-percentage-point drop from February, while a majority now express distrust toward him. The House of Representatives saw its trust rating collapse to just 11%, and the Senate fared little better at 16%. When nine in ten Filipinos believe there is collusion among politicians, contractors, and officials to defraud infrastructure funds, the crisis is no longer merely fiscal. It is existential for the political system.
Against this backdrop, the administration is working to stabilize the situation — arresting officials, creating an Independent Commission for Infrastructure, promising accountability. But the opposition (or is it oppositions?) has not articulated a governing blueprint. Civil society efforts, while energetic, remain dispersed. The environment is full of pressure but lacks direction.
A Precedent: People’s 2000
The early 1990s offer a useful precedent. Fidel V. Ramos inherited a country reeling from institutional fragmentation and economic uncertainty. Power outages crippled homes and industries. Marcos-era monopolies strangled competition. The Philippines had earned the unflattering title of “sick man of Asia.”
Faced with these challenges, the Ramos administration built an internal coordination mechanism that operated quietly but with remarkable effectiveness. Beginning even before Ramos assumed the presidency in 1992, reform-minded undersecretaries, business leaders, and civil society figures were convened to draft an economic reform strategy. A confidential support group of some 30 policy researchers studied successful reforms elsewhere (Japan’s Meiji Restoration, Singapore, Taiwan and drew lessons for the Philippine context.
The group called itself “People’s 2000” because two key elements anchored its vision: people empowerment and global competitiveness. They patterned their work after the genrõ, the informal council of elder statesmen who guided Japan’s modernization, except that they chose to work more quietly and without taking credit.
Three Passions
Members pledged themselves to what they called the “Three Passions” — passion for excellence, meaning discipline in planning, monitoring, and implementation; passion for the Filipino people, expressed through reforms aimed at opportunity. competitiveness, and institutional strengthening; and most distinctively, passion for anonymity, working without seeking visibility, credit, or political gain. This anonymity allowed coordination to continue even when formal institutions were under stress. It also prevented reforms from being tied to personalities rather than goals.
The results were transformative. The administration broke apart monopolies in telecommunications, shipping, airlines, and banking. It privatized key assets (Petron, Philippine National Bank, Philippine Airlines, the Metropolitan Waterworks and Sewerage System) to fill depleted government coffers and introduce competitive discipline. It ended the power crisis within a year. By 1996, the economy was growing at 7.2%, inflation had fallen to 5.9%, and the Philippines was being compared favorably with the Asian Tigers.
Perhaps most importantly, People’s 2000 provided an internal architecture that formal institutions lacked. All presidential speeches consistently delivered the reform message. Cabinet members carried it to foreign capitals and multinational boardrooms. The choir was singing the same song.
Without a shared economic frame, political competition becomes reactive rather than constructive. Energy is consumed by scandal management rather than structural reform. Trust erodes not just in the individuals who have betrayed it, but in the institutions themselves.
A Modern People’s 2000
A contemporary People’s 2000 approach could help restore coherence. It would not replicate the strict confidentiality of the 1990s version (transparency norms have rightly evolved), but it would translate the same principles into a contemporary setting. It would involve technocrats, local government reformers, civil society groups with implementation capacity, academic institutions capable of generating evidence, and private sector actors committed to competitive markets. Its purpose would be to establish a shared frame for economic governance, regardless of political alignment.
Three Fronts
First, strengthening integrity in public spending. The flood control scandal revealed systemic gaps in procurement and oversight. More than 400 “ghost projects” were never implemented; others were built with substandard materials (three-meter sheet piles instead of the 12-meter steel specified in designs). Audit findings for 2023 showed that of 905 flood mitigation structures planned, only 450 were completed. Addressing these failures requires standardized contract design, stronger auditing frameworks, and coordinated implementation across agencies. These are tasks that benefit from a disciplined reform nucleus operating across institutional boundaries.
Second, rebuilding economic credibility by grounding decisions in real market conditions. The Noche Buena controversy underscores the need for policy signals based on price behavior, distribution chains, and wage realities rather than ministerial optimism. A People’s 2000-type mechanism would move across agencies to focus on quick improvements in prices, wages, and employment levels, especially given the collapse of government spending on infrastructure.
Third, creating a shared economic direction that both administration and still cooperative opposition can work within. The absence of an articulated alternative program is part of the current stagnation. A national economic frame would not eliminate political competition (nor should it), but it would move competition toward programmatic debates about priorities and trade-offs. It would also encourage segments of the opposition that are still cooperative with the administration to formulate a credible governing blueprint, which is essential in any healthy democracy. Countries exit institutional stress not through isolated responses but through disciplined coordination anchored on long-term economic objectives.
The Lesson
Political stability emerges from economic credibility. Coherence in economic governance reduces uncertainty, tempers political conflict, and rebuilds public trust.
A modern People’s 2000 does not privilege one political actor. It responds to the reality that the system needs internal alignment, a skeleton of coordination that formal institutions, weakened by scandal and distrust, cannot currently provide on their own. It brings together those willing to subordinate ego to purpose, to work with discipline rather than drama.
The flood control scandal has exposed deep rot. But it has also created an opening, a moment when Filipinos are paying attention, demanding accountability, and open to new approaches. The question is whether reformers will organize to seize it. Because in moments like this, the central point remains true: it is, in fact, the economy.
Dr. Joey Sarte Salceda is the Chair of the Institute for Risk and Strategic Studies, Inc.
or Salceda Research, a think tank based in Manila focused on governance, tax policy, climate change adaptation and disaster risk reduction.