"My late friend had many official and personal stories about the early days of monetary policymaking in this country."
Considering that my longtime friend and colleague, Dr. Benito Legarda, Jr., was steadily advancing in age, I had long thought of devoting a column to him. As it sometimes happens, my intention was overtaken by time: Dr. Legarda passed away toward the end of last month.
Dr. Legarda –Beniting to those who knew him sufficiently well – was an economist who spent his entire professional life in one institution, to wit, this country’s monetary authority (Central Bank of the Philippines until 1993, Bangko Sentral ng Pilipinas thereafter). Armed with a Bachelor of Arts degree and a doctorate from Harvard University, he returned to his country rather than pursue a career in the US. After all, he was a scion of one of Manila’s Old Rich families.
Dr. Legarda went to work for the CB, which at that time had just been established by the administration of President Elpidio Quirino. As its first director, Legarda organized one of the key elements of a central bank, the Department of Economic Research, The Quirino administration appointed lawyer-banker Miguel Cuaderno, one of Bataan’s delegates to the 1934-1935 Constitutional Convention, as the first governor of the CB.
With Dr. Legarda’s intelligence, educational background and his performance as a special assistant to the governor, in time he was further elevated, becoming the deputy governor for economic research, a post he held at the time of his retirement from CB.
Although CB was the only institution that he served, central banking was by no means Dr. Legarda’s only abiding interest. His other principal interest was Philippine history, especially its economic aspects. He was deeply interested in the two-centuries-long trading arrangement involving the Philippines (then known as Las Islas Filipinas), Spain and Mexico. The result was the book “The Galleon Trade: From Manila to Acapulco.” Extremely well-researched, Dr. Legarda’s book has become the authoritative work on that part of modern Philippine history.
Dr. Legarda wrote another book that likewise has become the authority on its subject. I refer to his book describing the situation in Manila during the month-long US military campaign to liberate the nation’s capital from the remaining Japanese Imperial forces. Equally well-researched, the book recounts with utmost vividness the agony and the pain of the city residents who were caught between the advancing Americans and the retreating Japanese.
Dr. Legarda undoubtedly left a legacy of scholarship and enriched this country’s literature with his two books. But there is one book that he did not write – one that, in my view, he should have written. That would have been a book about the formative years of the country’s monetary authority – specifically, the period from 1950 to 1961, which was the period of Mr Cuaderno’s governorship. The first governor resigned when the Nacionalista Party’s Carlos Garcia lost the 1961 election to the Liberal Party’s Diosdado Macapagal.
Dr. Legarda would have had plenty of material for the unwritten book. He was present during the creation of the CB. As the CB’s chief economist, he was involved in the structuring of the system of import and exchange control whose administration eventually became so corruption-ridden that candidate Macapagal promised to dismantle it forthwith upon his election. He did just that.
Dr. Legarda was close to the top officials of the CB, especially Mr. Cuaderno and Dr. Andres Castillo, who succeeded Mr. Cuaderno. As DER head, he attended the meetings of the Monetary Board and travelled with the governor to all international meetings, including the annual joint meetings of the International Monetary Fund and the World Bank.
My friend had many stories – official as well as personal – to tell about the early days of monetary policymaking in this country. It is a great pity that he did not put them into a book. Those who are interested in Philippine economic history are the poorer for his not having written that book.