231. Paper Prepared in the Embassy in the Philippines1

[less than 1 line of source text not declassified] Manila Reply to Questions Concerning Philippine Constitutional Convention

1.
It might be useful for a better understanding of the atmosphere in which the Constitutional Convention will take place to note current issues in Philippine political life which affect U.S. interests. These issues, which have been developing over a number of years, are:
a.
A desire to eliminate special privileges currently allowed to U.S. investors and to regulate U.S. investments in the Philippines by new legislation based upon laws similar to those governing foreign investments in other Southeast Asian countries. In 1946 the Philippine Constitution was amended to give U.S. citizens equal rights with Filipinos in the development of natural resources and in the operation of public [Page 491]utilities. The Laurel–Langley Agreement also granted reciprocal national treatment to U.S. or Philippine citizens engaged in commercial activities within the other country. In addition, it provided for tariff preferences which favor the U.S. This agreement has been modified but its basic provisions remain intact.
b.
A policy for U.S. military bases which would limit the free hand which we have thus far enjoyed in their operation and which would, at the same time, raise the price we must pay. The Philippine Constitution, for example, authorizes the U.S. to acquire bases in the Philippines for the mutual protection of the Philippines and the U.S., rent free.
c.
A foreign policy which would establish diplomatic and trade relations with the Soviet Union and Eastern European nations.
2.

What interest does the U.S. have in the Philippine Constitutional Convention?

In the long run we believe U.S. interests would be served adequately by a constitution which would encourage the viability of a self-sustaining, friendly Philippines, wherein our investments would not be discriminated against and whose soil we could use for military purposes under certain conditions. In the short term, 3–5 years, we would not want the use of the two military bases, Clark and Subic, significantly curtailed. In addition, we would not want to be confronted with constitutional provisions that would adversely affect U.S. investments in the Philippines without adequate provisions for retaining, or receiving compensation for, assets acquired under the current arrangement.

3.

Whom should we back, President Marcos, the moderates, or no one?

At this point in time there is no need to commit U.S. support to any particular group. Marcos-backed delegates probably will constitute the single largest voting bloc in the Convention. The other delegates will be made up of smaller groups representing business, religious, provincial and other special interests. These smaller groups will form alliances with one another and trade off support depending upon the particular interests they wish to advance at a given moment. Information available to us now on approximately 1,800 out of the more than 2,500 candidates leads to the conclusion that the majority are moderate in their outlook on issues which affect the U.S. Of the 1,800 candidates examined, there are less than 20 who can be classified as radical left or communist.

4.

If we are to become involved, how should we do it and what should be the size of our activity?

We should remain alert to the workings of the Convention. Should trends develop which would adversely affect our interests we should [Page 492]act [less than 1 line of source text not declassified] to back the work of individual delegates or group leaders and deflate the more extreme proposals. We cannot control the majority of the Convention delegates. We can, however, directly or indirectly control small blocs of delegates which could, in turn, be joined to larger forces to protect our interests if the need arises. We believe the total number of delegates required to influence the Convention would not exceed twenty.

5.

“Worst Case” assessment2

There is a remote possibility that a solid minority of the delegates might acquire a supra-nationalist attitude or spirit and press for a constitutional revision which would jeopardize our interests. They might call for an immediate nationalization of foreign investments with only nominal compensation or they might seek to deny us the unrestricted use of our military bases. In such an event, we believe we could [less than 1 line of source text not declassified] fragment the minority bloc, and encourage delegates to join the Marcos bloc. This would be costly [less than 1 line of source text not declassified], and might promote charges of political interference, but probably could be effective. In the long run such American interference in Philippine elections, however, would be politically counterproductive.

6.

Possible outcome of the election

The intelligence available to us at this juncture indicates that Marcos, without making any further effort, can be expected to emerge from the elections with a minimum of 100 delegates3 responsive to his dictates. This is so because of the procedures which govern the campaign. Marcos has the best political machine in the country and access to public funds which no other organization can match. There are several other factors which give Marcos an advantage. The Liberal Party has not recovered from its defeat in the 1969 Presidential elections and lacks adequate funds. The Catholic Church lacks the experience, the funds and the organization necessary to contest political elections successfully on a nationwide basis. With the possible exception of Manila, and Rizal Province, the field is open to the pressures and tactics that the Marcos machine has demonstrated it is capable of applying. If he does [Page 493]not have a clear majority of the delegates in hand after the election of delegates, he will, as a result of his machine’s effort between now and the opening of the Convention, acquire what he needs for a majority when the Convention begins. He controls the Government machinery and will be the President for three more years. The problems that Marcos might have during the election and Convention will stem to a certain extent from his tendency to over-kill and the resentment that such an approach generates.

7.

Possible outcome of the Convention

The Convention most likely will produce a moderate document containing modest changes in the structure and functioning of the Government. The proposed Constitution probably will affect directly or indirectly foreign investments in the Philippines, although it is doubtful that these new provisions would be so extreme in nature as to exclude or seriously damage our business interests. This will probably also apply to the U.S. military bases.

8.
The unknown factors which complicate our analysis are the precise objectives and plans of President Marcos. We know he wishes to prevent any significant reduction of the powers of the Philippine President. He also does not wish to decentralize a highly centralized government. Some say he would like to perpetuate himself in the Presidency. It is on these issues that delegates not in the Marcos camp might unite into an anti-Marcos bloc. Should Marcos seek to change the term of the President from two four-year terms to one six-year term and have this new provision apply to his administration, he probably will provoke the delegates to take extreme positions, although they would not be against a six-year term per se. If Marcos does decide that his tenure as President is to be his primary objective, he would be willing to make all compromises necessary to achieve this end. This could include a decision by him to adopt a supranationalist position, and, in the unlikely event Marcos finds himself unable to control the Convention, it is possible that he would move to dissolve it.
  1. Source: Department of State, INR Historical Files, Country Files, Philippines, 1969, 1970, 1971. Secret; Sensitive; Eyes Only. The assessment was in response to an October 6 directive of the 40 Committee ( Document 230).
  2. In an October 13 covering memorandum to Johnson, Green noted that should the “Worst Case” eventuate, i.e. “that a solid minority of the Convention might call for revisions which could jeopardize U.S. interests,” [text not declassified] “believes that this minority could be fragmented [less than 1 line of source text not declassified].” However, such an action would be costly [text not declassified]. Green said that “I agree in general with these assessments, and see no reason to initiate any [less than 1 line of source text not declassified] action directed supporting President Marcos in the Convention at this time.”
  3. There will be a total of 320 delegates to the Convention. [Footnote in the source text.]