368. National Intelligence Estimate1

NIE 56–68


The Problem

To assess the situation and prospects in the Philippines over the next two years or so, particularly with regard to the performance of the Marcos administration.


The Philippine political system, despite the trappings of democracy, is dominated by a wealthy and conservative oligarchy, largely unresponsive to the economic and social needs of the vast bulk of the population.2 President Marcos, a man of remarkable personal and political achievements, has been unable to rise above the system. It is not likely that the remainder of his administration will be any more productive; from now until the next presidential election in November 1969, both he and his opponents will be increasingly preoccupied with politics to the detriment of substantive programs.
Even over the longer term, prospects for reform of the Philippine social and political apparatus do not appear promising. Although the left does not pose an immediate threat, it may be able to convert existing apathy and resignation into discontent and eventually active opposition. Moreover, Philippine frustrations are likely to have an increasingly anti-American cast.3
The cornerstone of Marcos’ foreign policy is the US-Philippine alliance, which is generally approved. A recent agreement has, for the time being at least, removed major problems related to US military bases. Though Filipinos generally are apathetic about the war in Vietnam, leaders are deeply concerned that the US maintain a strong position in Asia and will, from time to time, seek reassurance as to the US security commitment to their country.
New openings to the outside world in the form of increased participation in Southeast Asian regional affairs, contacts with more countries outside the region (including Communists), and greater awareness of the implications for the Philippines of external developments will reduce the general parochialism of the country, but probably not significantly in the near term.

[Here follows the Discussion section of the estimate.]

  1. Source: Department of State, INR/EAP Files: Lot 90 D 165, NIE 56–68. This estimate was prepared by the Central Intelligence Agency and the intelligence organizations of the Departments of State and Defense, and the NSA. All members of the U.S. Intelligence Board concurred with its submission with the exception of the AEC and FBI representatives who abstained on the grounds that the subject was outside their jurisdiction.
  2. In a memorandum to Fred Green of INR/REA, June 27, C. Hoyt Price, Director of EA/PHL, argued that this NIE was “too pessimistic” and quoted from an IBRD team assessment that suggested that the Philippines’ economy “was in better condition than it has been during most of the last decade.” The 1967 growth rate was 5.6 percent as compared with 4.2 percent in 1966. Food production was up, there was a rice surplus, and public investment projects were being completed. Price suggested that since the IBRD assessment was so much at variance with the NIE, the NIE should not be made available to other governments. (Ibid.) This NIE was not released to other governments. (Memorandum from Hughes to Price, July 18; ibid.)
  3. On July 12 John Holdridge (INR) prepared a rejoinder to Price’s June 27 memorandum which concluded that “aggregate economic growth, especially when accompanied by an extremely high birth rate and inequitable distribution of income is an unreliable barometer of social-economic progress.” Holdridge stated that there was no “evidence” that “an increase in the GNP noticeably lessened the burdens of poverty, unemployment, land hunger and corruption borne by the average Filipino.” (Ibid.)