I was startled when I read this question in an article by an astute American observer of Asian affairs. I was browsing the Internet during the Easter weekend in the hope of getting a respite from the daily diet of news reports about the terrible state of affairs in our country these days. You know, the leadership crisis, the oil crisis, the rice crisis, the power crisis, and, oh, God only knows what else.

What came out of my Apple laptop's screen - lo and behold! - was that article about how "a massive scandal has driven politics in the Philippines off the rails" as written by Walter Lohman of the Asian Studies Center at The Heritage Foundation in Washington, D.C.

"That the intersection of business and politics is rife with corruption is hardly a revelation," he wrote. "Nor is it extraordinary by the standards of current practices in Asia. What is troubling, however - perhaps only because, unlike corrupt dealings in other countries, it takes place within a lively, often raucous democracy - is the way corruption has come to dominate public discourse so thoroughly."

I must say that he is right, as indeed I have long noted in this columns ever since the unelected president Gloria Macapagal-Arroyo came to power in 2001. Obviously, Lohman saw it, too, with the latest of innumerable scandals involving the $329 million contract of the ZTE Corporation, a major telecommunications company in China, to provide a national broadband network here.

This scandal is currently under investigation by three Senate committees led by the Blue Ribbon Committee. The principal allegation, as the whole world knows already, is the inflated price of the project which "is the result of a new, shameless level of corruption." And this is where he raised that startling question, "Who exactly is accountable is the devil buried in the details. Suspicions and investigations have converged on President Arroyo's husband and a few key officials."

Now, I consider the more revealing part of Lohman's article is this: "As big as the scandal is in dollar terms, the most spectacular charge to emerge from the controversy is that the contract from flows from a 2004 China-Philippines deal to put aside sovereignty claims in the South China Sea in order to conduct a joint seismic study."

Of course, he was referring to the controversial exploration agreement in the disputed islands of Spratlys between the Philippines and China. The striking thing about the so-called seismic study is that it will include not only the disputed areas of the South China Sea, but also parts of the Philippine continental shelf.

He warned of the obvious danger of such cooperation - far from the China mainland but close to the Philippines - will eventually threaten Filipino sovereignty. As he put it, "a study will lead to a joint tapping of resources tomorrow and ultimately reinforce Chinese claims on the territory."

The ZTE-NBN deal, he revealed, is only one element to emerge from $2 billion per year in Chinese project loans offered soon after the agreement for exploration in the Spratlys islands. The loan program will extend to 2010, the last year of Gloria Arroyo's term. And this has already facilitated "dozens of deals beyond the ZTE project."

But more disturbing, is his revelation of another massive deal that has aroused suspicion is the 25-year concession to the Philippine power grid, the biggest privatization in Philippine history. "The $4 billion deal has a similar confluence of factors: Chinese involvement, high-value assets, and charges of connections to the Filipino first family."

What is alarming about all these cases is the possibility that corruption in the Philippines, according to Lohman, may have reached the point of trumping national interest. Judging by the public debate, that is the conclusion that one may draw from the most sensational commentary calling the South China Sea deal "treason" on the part of President Arroyo.