Abstract
Philippine data are presented which indicate that a contradiction exists between changes induced partly through capital accumulation by the indigenous elite and foreign investment, and both increased political factionalism and declining voting participation. While national elites become more powerful through capital accumulation, local political machines confront structural changes weakening their power. More specialized patron-client structures diminish local elites' ability both to deliver votes to national patrons and to stimulate electoral participation. Growth of the middle class in a stagnant economy increases competition for lucrative local political office Factions proliferate and with the increased concentration of private income, become more dependent on national patronage resources. Unable to meet rising patronage demands, the government resorts to extensive deficit spending which stimulates inflation and further undermines economic growth. The national elite's economic activities thus undermines its authority base as the state becomes increasingly less able to provide security to individuals dislocated by changes generating profit for the elite.
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