The Philippines Now the Hard Part

By Susan Tifft.

The men wore loose-fitting barong tagalogs; many of the women, designer dresses. The formality was appropriate for a presidential inauguration--even one called at short notice. But the dignitaries and affluent friends assembled at the Club Filipino in the Manila suburb of Greenhills merely formed a splendid backdrop for the more modestly attired guest of honor. Clad in a simple yellow dress, Corazon ("Cory") Aquino, 53, could hardly have imagined this moment three months ago, when her improbable quest for the Philippine presidency began. Her voice was calm and steady as she recited the presidential oath, her hand resting on a leather-bound Bible. "I am taking power in the name of the Filipino people," she declared. "I pledge a government dedicated to upholding truth and justice, morality and decency, freedom and democracy."

Less than twelve hours later her predecessor, Ferdinand Marcos, and his family climbed aboard four U.S. Air Force helicopters, bound for exile after more than 20 years of increasingly authoritarian rule. Aquino went on national television to assure the country that a great national crisis had been resolved. "We are finally free," she said. "The long agony is over."

The protracted and sometimes bloody effort to oust Marcos had indeed come to an end. Carried by a ground swell of popular emotion and aided by Marcos' Defense Minister, Juan Ponce Enrile, and Vice Chief of Staff, Fidel Ramos, who suddenly defected to their cause, Filipinos had mounted an essentially unarmed, democratic revolution and, perhaps to their own astonishment, triumphed. In a period of only 78 hours, as his troops and tanks backed off from confrontations with thousands of demonstrators, Marcos slipped swiftly from undisputed one-man rule to no rule at all. Just after Aquino took her presidential oath, Marcos had himself inaugurated at Malacanang; it was his last official act before fleeing to Clark Air Base, north of Manila, and thence to Guam and Hawaii.

In a fiesta of freedom, thousands of Filipinos paraded through Manila's Makati financial district under exploding fireworks and a shower of yellow confetti. On the sidewalks, vendors did a brisk business in T shirts emblazoned with CORY. Car horns honked in chorus. Occasional placards bobbed and dipped in the crowd. REBELLION TO TYRANTS IS OBEDIENCE TO GOD, read one. JUST LIBERATED, read another. As cars crawled along teeming Ayala Avenue, men, women and children, priests, nuns and soldiers stopped to greet each other with a salutation that somehow captured the moment: "Happy New Year."

Washington closely watched the power shift in Manila, partly because of the special relationship between the U.S. and the Philippines, a former colonial ward, partly because of the strategic importance of U.S. bases there, and partly because of what the White House saw as a timely confirmation of one of its most controversial foreign policies. In a meeting with journalists, President Reagan argued that the Administration's deft handling of the Philippine crisis strengthened the case for increased U.S. aid to the contra rebels, who are battling the Marxist Sandinista regime in Nicaragua. Explained Secretary of State George Shultz, who followed Reagan at the briefing: "We see in Nicaragua, much more than in the Philippines, a government at odds with its people." A State Department aide put it more politically. "We feel we're on a roll," he said. "Now we want to use that momentum and apply it to the contras."

Sweet as Aquino's victory was, the morning after for her fledgling government came all too soon. The triumph over Marcos may soon seem easy, compared with the tasks ahead. The once promising Philippine economy is moribund. The military is factionalized and riddled with corruption. A Communist insurgency mounted by the New People's Army threatens large areas of the 7,100-island archipelago. To this staggering array of ills, Aquino brings a moral force and a popularity that will buy her the indulgence and goodwill of the Filipino people, at least for a while. "There are big problems in the + Philippines," said a senior U.S. State Department official last week. "We have always felt that only a government that enjoyed a genuine popular mandate could effectively address them."

There is no question that Aquino, who was transformed from mere symbol to forceful leader over the past six months, has the mandate. What she lacks is experience in governing. At her first presidential conference, Aquino asked the country for patience. "I'm doing my very best," she said. "I only wish that people would give us time."

Such an appeal is hardly necessary as long as most Filipinos are caught up in the euphoria of what they call liberation. But the confetti and adoring crowds cannot last forever. "This government is sincerely committed to reform," says one Western diplomat. "But they will learn that this is easier said than done." There will be a honeymoon, perhaps six months, after which 56 million Filipinos will expect to see results from their new leaders. "No matter how good she is," observed Senator Joseph Biden, a Delaware Democrat, "she is almost incapable of meeting the expectations of the Philippine people." Said Ernesto Maceda, Aquino's Minister of Natural Resources: "There really was no forward planning for a sudden assumption of office. Our problems are just beginning."

That was apparent last week as Aquino gamely began tackling the job of governing. In keeping with its spontaneous beginnings, the new administration had a decidedly makeshift look about it. In the building that had served as her campaign headquarters, Aquino aides rubbed shoulders with foreign ambassadors, job seekers and influence peddlers. There, the Philippine President met with U.S. Special Envoy Philip Habib, who was dispatched last week by Reagan to convey his "warmest greetings" to the new government. Outside, a carnival atmosphere prevailed. The building's small parking lot was filled to overflowing with cars, jeepneys and diplomatic limousines, as vendors sold soft drinks and snacks to drivers and security guards.

Those Marcos ministers who had not fled the country stayed at their posts until Aquino met with them and appointed her own people. The new President assured most civil servants that they could keep their jobs, but questions remained concerning changes in policy and personnel outside the bureaucracy. "This is a government that doesn't even have a typewriter," said Presidential Spokesman Rene Saguisag, 45. Indeed, it had been so long since + the last transfer of power in the Philippines--1965--that no one in or out of government knew precisely how to go about it.

Aquino's first challenge was to establish a cohesive administration, a task made difficult by Marcos' debilitating legacy of one-man rule. Mindful of the dangers of a political vacuum, she moved swiftly to show that she was in charge. During her first full day as President, she appointed 17 Cabinet ministers and held her first news conference. In an effort to defuse the impulse to seek revenge on Marcos followers, she spoke forcefully of the need for reconciliation. The President, who has frequently called Marcos the "No. 1 suspect" in the 1983 assassination of her husband, Senator Benigno ("Ninoy") Aquino Jr., made it clear she would not seek the extradition of Marcos from exile, although she hinted she might reopen an inquiry into the murder. "I can be magnanimous in victory," she said. "It is time to heal wounds and forget the past."

Aquino acted quickly to fulfill one of her campaign promises. A day after her inauguration, she authorized the release of 33 of the 475 Filipinos imprisoned under Marcos' Preventive Detention Act and other statutes, laws that permitted incarceration without trial for a variety of alleged offenses, from antigovernment protest to suspected subversion.

Initially, Aquino announced that political detainees would be freed on a case-by-case basis. Those charged with spurious political offenses would be released, but Communist insurgents and those accused of violent crimes would be held for trial. That bothered many of her followers, who felt that she should show at least as much compassion for Marcos' victims as she had for Marcos. The next day Aquino ordered the release of all remaining political prisoners, subject to "certain administrative requirements." However, it was announced that four specific cases, including that of Jose Maria Sison, the 47-year-old head of the outlawed Communist Party of the Philippines who has been behind bars since 1977, would have to be carefully studied before any action is taken.

Questions remained about less fortunate enemies of the Marcos regime. In a television interview, Human Rights Lawyer Joker Arroyo, 58, now the President's executive secretary, compared the Philippines to Argentina and its grisly legacy of "disappeared ones," the estimated 9,000 victims of military governments in Buenos Aires who mysteriously vanished between 1976 and 1982. ! "When the history of the Philippines is known," Arroyo said, "perhaps we will beat the record of Argentina in magnitude and torture."

Arroyo's claim is probably exaggerated, but not by much. Task Force Detainees, a Philippine religious organization that investigates detentions, says that in 1985 there were 602 disappearances, 1,326 cases of torture and 276 political executions. Last week newly freed prisoners gave chilling accounts of confinement in Marcos' jails. "I experienced kicking, boxing and mauling," said Danilo dela Fuente, 36, a labor organizer who was among the first to be released. "My head was banged against a concrete wall. They put a gun to my temple and played Russian roulette. They put it in my mouth and twisted it. Once I was blindfolded for 17 hours, and they would whisper, 'You will be killed tonight.' " The new Aquino administration is considering the establishment of a presidential commission to investigate political assassinations and unexplained disappearances during the Marcos era.

In selecting her Cabinet, Aquino demonstrated an understanding of politics that impressed even her harshest Washington critics. Except for two Marcos holdovers--Defense Minister Enrile and Central Bank Governor Jose Fernandez --the 16 men and one woman given ministerial portfolios represent the spectrum of centrist opposition that supported Aquino's candidacy. The Cabinet has a firmly middle-class, moderate cast that is so reflective of Aquino's own background and political views that a reporter at her first press conference pointedly asked whether the choices were too "elite." The Cabinet selections did not please the far left, which decried them as "bourgeois," but the ministers' middle-of-the-road credentials should appeal to the business community and the international lending institutions on which the Philippine economy depends for recovery. As important, Aquino's choices were widely recognized in both the Philippines and the U.S. as competent and dedicated, a far cry from the Marcos period, when many top positions in government went to relatives, friends and palace cronies.

The most prominent member of the Cabinet is Aquino's Vice President, Salvador ("Doy") Laurel, 57, a childhood friend of her husband's and a former Marcos supporter who did not join the opposition until 1980. Laurel was also named Prime Minister and Foreign Minister. The triple titles and double portfolio were largely a prearranged reward for Laurel, who set aside his own ^ presidential ambitions last December to become Aquino's running mate in the Feb. 7 election. As her part of the deal, Aquino, who had no party affiliation, agreed at the time to run on the ticket of Laurel's party, the United Nationalist Democratic Organization (UNIDO). The compromise ensured a united opposition ticket but angered leftists, who distrust Laurel and what they describe as his pro-American views.

Two figures close to Laurel joined the Cabinet: Luis Villafuerte, 50, an investment banker and lawyer, who was chosen to head a presidential commission on government reorganization, and Ernesto Maceda, 50, also a lawyer, who received the Natural Resources portfolio. Both men, like Laurel, are former Marcos allies who severed their ties with him some years ago.

For balance on the other side, Aquino chose two center-left Assemblymen from the Pilipino Democratic Party-Laban. Aquilino Pimentel, 50, repeatedly jailed during the Marcos period for opposing the government, became Minister of Local Government, while Ramon Mitra, 58, an outspoken rancher, assumed the post of Minister of Agriculture. Aquino repaid debts to political independents who strongly supported her during the bitterly contested election. Among them: Jaime Ongpin, 47, the chairman of the Benguet Mining Corp. and one of her main campaign strategists, who was named Finance Minister, and Jose Concepcion, 54, a businessman and head of the National Movement for Free Elections, a citizens' watchdog group, who became Minister of Trade and Industry.

The most important carryover from the Marcos era was Defense Minister Enrile, 62, who, with General Ramos, mounted the daring rebellion that proved to be the catalyst for Marcos' fall and Aquino's ascension. Enrile's entry into the Aquino government changed the equation of power in the ruling coalition. The Minister is personally popular with many Aquino backers, but his longstanding ties to Marcos (whom he served as defense chief for 16 years) and his own undisguised presidential ambitions make them uneasy. They are aware that they would not have gained power had it not been for Enrile's defiance of Marcos, but there is resentment, even fear, of the influence the Defense Minister may exert, particularly if the coalition proves to be fractious. Sensitive to the criticism, the Harvard-educated Enrile went out of his way last week to underscore his commitment to the new government. "Do you think we would have laid down our lives for a corrupt purpose?" he said. "If these (doubters) will give me time to show them what kind of person I am, I will show them."

Aquino seemed less concerned than her colleagues about a long-term threat from Enrile and gave him credit for the critical role he played in catapulting her into office. "I am not engaging in a popularity contest," she said when asked about Enrile's new hero status among many Filipinos. Retaining the Defense Minister and General Ramos, 57, represents both pluses and minuses for the President. On the one hand, they provide vital links to the 230,000-member armed forces, which she needs to keep order and to fight the Communist insurgents. On the other hand, the duo's long association with Marcos may make them suspect in the eyes of her longtime aides, who are not totally convinced that their eleventh-hour conversion was sincere.

Although Aquino showed personal compassion for Marcos in the interest of national unity, she made it plain that she would spare no effort to reclaim the vast fortune the Marcos family is believed to have spirited out of the country over the years. She announced the creation of a Cabinet-level Presidential Commission on Good Government, headed by former Senator Jovito Salonga, 65. One of the panel's tasks will be the recovery of an estimated $2 billion in "hidden wealth" that the Marcos family has surreptitiously squirreled away in the U.S. and Switzerland. Salonga said he had already secured counsel in New York City to block the possible sale of more than $300 million in Manhattan properties allegedly owned by the Marcos family. "We will have no trouble recovering the assets here in the Philippines," Salonga said. "But overseas we will have to proceed according to local law."

Though acclaimed as President, Aquino is technically head of a provisional government. According to Enrile, it was he who suggested that Aquino be sworn in even before it was clear that Marcos would leave Malacanang. "I took the initiative because we did not anticipate that the President would get out," he said. "He had the constitution. But we had the people with us." The scheme worked, but it left Aquino presiding over a government that is legally outside the constitution. Thus early this week she is expected to ask the Batasang Pambansa, or National Assembly, to nullify its Feb. 15 resolution proclaiming Marcos the winner of the election. The former President's departure has persuaded most legislators in his New Society Movement (K.B.L.) / to promise Aquino their backing. A new resolution recognizing her as the victor is expected to pass, but it is questionable whether it will be valid in constitutional terms. The snap election, which Marcos claimed to have won, 54% to 46%, was so tainted by fraud, most of it perpetrated by Marcos supporters, that it is now impossible to say with certainty which candidate prevailed.

Once endorsed by the National Assembly, Aquino is likely to call a constitutional convention to rewrite the present document, eliminating some of its more authoritarian provisions. The plan is broadly supported by her advisers, even Enrile. "We should revise the constitution and remove its imperfections," he told TIME. "It was tailored to serve a regime." One of the first provisions to go will be Amendment 6, which granted Marcos broad decree-making powers. Aquino pledged during the campaign to repeal the amendment or, alternatively, to use it one last time to wipe out all of Marcos' repressive measures.

One of Aquino's main goals during her first days in office will be to throw some of the gears of government into high-speed reverse. "More than determining what government should be doing, we will attempt to define very clearly what government should not be doing," says Minister Villafuerte. The language sounds Reaganesque, but in today's Philippines, less government means greater civil liberties as well as unfettered markets. Aquino raised the issue of decentralization before the election when she outlined a detailed plan for her first 100 days in office. Among the promises: to unshackle the government-controlled press, expel corrupt judges, and repeal labor laws that permit police to order strikers back to work.

In the same speech, Aquino referred to the Philippines as the "basket case of Southeast Asia," an unflattering but all-too-accurate reference to the economic wasteland she has inherited. The Philippines' foreign debt exceeds $27 billion. The annual interest payment alone--about $1.7 billion--amounts to a third of export earnings. In 1985 the growth rate plunged to negative 3.5%, while per capita income declined to about $600 a year, no higher in real terms than it was in 1972. Almost half of the nation's 21 million workers are unemployed at least part of the year. One of the priorities of the new government will be to provide more jobs.

Marcos deserves much of the blame for the economic malaise. He vastly overspent the treasury, pumping public funds into 300 government-owned corporations, as well as flashy projects like luxury hotels and a nuclear- power plant. He lavished special attention on firms owned by friends and relatives, a practice known in the Philippines as crony capitalism. When the companies failed, the government rushed in with bailouts it could not afford. By 1983 the Philippines was so strapped it was forced to declare a moratorium on foreign-debt repayments. After a flurry of negotiations, the International Monetary Fund came to the rescue with standby credits, conditional on Marcos' adherence to an austerity plan that included severe budget cuts.

To this bleak scenario, Aquino brings the promise of honesty and the hope of political stability. "One very positive feature of her presidency," says Singapore Foreign Minister Suppiah Dhanabalan, "is that confidence, an important ingredient of economic growth, will be re-established." That was readily apparent last week, when some issues traded on the Manila Stock Exchange climbed by as much as 40%. On the American Stock Exchange in New York City, the price of shares in the Philippine Long Distance Telephone Co., the country's equivalent of AT&T, more than tripled in one day.

Aquino's economic program is strongly oriented toward the free market. She has pledged to dismantle the sugar and coconut monopolies operated by Marcos cronies, reduce regressive fuel and electricity taxes, and do away with seed and fertilizer levies that hamper agricultural diversification. She has said she will try to negotiate better repayment terms for the foreign debt in the hope that export earnings will be freed to stimulate growth. Not surprisingly, businessmen were among her most ardent backers, and Aquino's economic policies are certain to retain a pro-private enterprise tilt.

In naming Harvard-educated Ongpin her Finance Minister, the President made an especially wise choice. Ongpin promises to be a strong voice in the Cabinet. Even in his first days in office, he raised hackles among some UNIDO members by insisting that Jose Fernandez, 66, remain as president of the Philippine Central Bank. Ongpin's desire to keep Fernandez, a capable and widely respected financial expert, was eminently practical: he was a major architect of the IMF bailout scheme that saved the Philippines three years ago and will be a key player in ongoing consultations on the foreign debt.

Before the Aquino government can carry out a new economic program, however, it will have to stabilize the political situation. Aquino will have to neutralize remaining Marcos loyalists in the K.B.L., particularly the party bosses in rural areas, who rule their fiefs like medieval warlords. One group she probably will not have to worry about, for the moment at least, is the left, which seemed genuinely stunned by her success. Bayan, a federation of 1,000 "cause-oriented" groups, joined the outlawed National Democratic Front, the Communist Party's political arm, in boycotting the election. Last week the N.D.F. criticized Aquino's Cabinet choices but admitted in a press statement that the ouster of Marcos was a "significant victory in the Filipino people's struggle for genuine democracy and national independence." Bayan announced that it planned to play a "watchdog" role, apparently without sabotaging Aquino's efforts. But it was not lost on Bayan leaders that their absence from the Aquino campaign rules out a share of the spoils. Said one: "If we had participated, we could have easily meshed with Cory's organization."

The Aquino triumph is a setback, however temporary, for the Communist guerrillas in the New People's Army, whose numbers are estimated at between 16,500 and 20,000 armed men. Its strength, according to Pentagon officials, has grown 20% annually since 1983, when Aquino's husband was assassinated. During the campaign, Aquino often said that Marcos, who sought a military solution to the insurgency problem, was the N.P.A.'s best recruiter. Her hope is to eradicate the poverty and discontent on which the Communists build to promote their cause. "The N.P.A. sees that people are not willing to embrace any kind of repressive regime, whether from the left or the right," says Enrile. "Filipinos want a centrist, liberal, democratic person in government."

In this spirit, Aquino reiterated her campaign pledge last week to call a six-month cease-fire in the war against the N.P.A., which caused more than 1,200 civilian deaths in 1985. If the guerrillas would disavow violence, she declared, she would offer them amnesty. Said Laurel: "Given a credible government, a democratic moral order and a general amnesty, 90% of the people who are now fighting in the hills would lay down their arms and come home." In Washington, some Philippine experts dismissed such talk as naive. "Their plan seems unrealistic," said Larry Niksch, director of Asian affairs at the Congressional Research Service. "It will take the government a long, determined and very sophisticated effort to deal with the insurgency." Added one Western diplomat: "Aquino's success undoubtedly weakens the Communists' appeal to the so-called mass base. But one swallow does not a summer make." Unquestionably, Aquino's policy is a gamble. If she fails to make visible progress against economic problems, it is possible, even likely, that the insurgency will grow.

If that is the case, military strength will count all the more. Under Marcos' Chief of Staff, the despised General Fabian Ver, the Philippine armed forces became corrupt, undisciplined and top-heavy with overage brass. Ramos, the West Point graduate and respected professional who took Ver's place, says he plans to change that. One of his first acts last week was to retire 22 generals, including Ver himself and the chiefs of the major branches of the armed services. It was the first step in a military reform program long urged by the U.S. The Reagan Administration was delighted with Aquino's choice for Chief of Staff. "When you talk to Ramos about the problems of the Philippines," said a senior Pentagon official, "he can lay it all out."

Before the election, President Reagan promised the Philippines increased military and economic aid if the balloting was clean and fair. Washington intends to offer assistance to Aquino, but is not likely to act before ascertaining details of her overall plans. When the time comes, however, almost any request for military, economic and development assistance to the Philippines is certain to be well received on Capitol Hill.

Appreciation of Aquino in Washington is relatively new. Early on, many in the Administration dismissed her as inexperienced. They were especially concerned that if elected, she would demand that the U.S. abandon its military bases at Clark and Subic Bay Naval Station. There appears to be little danger of that, however. In a speech last month before the joint Philippine and foreign Chambers of Commerce, Aquino promised that she would consult other nations in the region and "especially" the Filipino people before signing any new treaty. Since then, she has repeatedly maintained that she would honor the present agreement until it expires in 1991, and between now and then keep her options open. As the campaign progressed, Aquino scored points in Washington, first for showing savvy and resilience on the stump, then, after the National Assembly declared Marcos the election winner, for keeping her + followers under control. "It became pretty clear that this was no ordinary housewife," said a senior State Department official.

During Aquino's 28-year marriage to one of the Philippines' ablest political figures, she seemed quite content to be a housewife and mother, and she was a genuinely reluctant presidential candidate. But she managed to channel widespread dissatisfaction with Marcos into a steamroller campaign that in the end swept him from power. U.S. pressure on Marcos surely helped, as did the last-minute defections of Enrile and Ramos. But at the center of it all was Aquino: petite, polite, increasingly self-assured, a woman who spoke for a country, molding an inchoate popular movement into a winning political force. The base of her appeal was a quiet strength, deeply rooted in her devotion to the Roman Catholic Church, which imbued her with seeming invincibility. "Ninoy you could hurt," said Teodoro Locsin, 37, Aquino's Minister of Information, last week. "But Cory you cannot hurt."

Aquino had the good fortune to lead a truly democratic rebellion, something quite different from the upheaval that ousted the Shah of Iran in 1979 and then degenerated into a regime of religious zealots. "This is not a revolt of the extremes," says Salvador Lopez, a former Philippine Ambassador to the United Nations. "This is a revolution of the center." For the moment, Filipinos, profoundly desirous of change, seem content simply to celebrate their emancipation. Says Lopez: "The people are happy that Marcos is gone, and that is the main thing." The challenge for the new President is to harness that spirit--and with dispatch--so that she can begin to tackle the array of problems confronting her. Says one of her supporters: "If Cory continues to be mesmerized by the euphoria of so-called people power and ignores the practical realities of politics, she will stumble sooner than expected." She clearly does not intend to fall into that trap.

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With reporting by Sandra Burton and Nelly Sindayen/Manila