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 You are in: Under Secretary for Public Diplomacy and Public Affairs > Bureau of Public Affairs > Bureau of Public Affairs: Office of the Historian > Foreign Relations of the United States > Johnson Administration > Volume XXVI
Foreign Relations 1964-1968, Volume XXVI, Indonesia; Malaysia-Singapore; Philippines  
Released by the Office of the Historian

Documents 359-374


359. Letter From the Charge in the Philippines (Wilson) to the Assistant Secretary of State for East Asian and Pacific Affairs (Bundy)/1/

Manila, October 26, 1967.

/1/Source: Department of State, Bundy Files: Lot 85 D 240, Ambassadors' Private Correspondence, 1967-1968. Secret; Official-Informal; Personal; Exdis.

Dear Bill:

By now you will have had a chance to digest Eugene Locke's two messages, our 3760/2/ and his back channel direct to the White House,/3/ which I assume has been passed on to you, regarding Marcos' assertion that he was short changed on the original five ECB's. I trust that Bill Jorden's accompanying back channel to Walt Rostow/4/ served its intended purpose of calming any immediate reactions at the highest levels at home.

/2/See Document 358.

/3/Attachment A to Document 357.

/4/Attachment B to Document 357.

The Locke messages do record, however, this rather extraordinary and curious play by Marcos; and some personal observations from here may be in order aside from any direct comment we send in on 3760--particularly since open comments on Locke's back channel message are a bit difficult under the circumstance.

First of all with respect to Marcos' ECB allegation, I find it very difficult to believe that Marcos in fact does not know the whole story on ECB numerology. To assert at this late date in the face of well documented past history that he was talking five (or ten) new battalions over and above his original three engineering battalions simply won't wash. There is a very remote chance, as he implied to Locke, that this came up in his private conversation with the President in September 1966 of which no one has a record. (This is the real reason Locke used that particular back channel to report it.) But I doubt seriously that anything in that detail would have been discussed.

Beyond this we have all sorts of evidence to indicate the contrary. I start with your own report of your February 1966 conversation with Marcos (Embtels 1792 and 1793 of February 26, 1966)/5/ in which you made it plain Marcos was then talking seven battalions in addition to his existing three. This conforms exactly with the discussions going on then between us, Mata, Raquizo and others as set forth in the attached summary briefing paper we drew up here last June when the allegation was first made that we were short changing them./6/ You will note in particular the attached schedule of battalion activation utilizing the original three as cadre for a total of ten battalions. This formed an integral part of the May 18, 1966 agreement between JUSMAG and the DND. The summary briefing paper and the chart were given both to Kokoy Romualdez and to Salas to show to Marcos in June. We can only assume they did what they said they were going to, and Marcos certainly understood the situation last June.

/5/Both dated February 26. (National Archives and Records Administration, RG 59, Central Files 1967-69, POL 27-3 VIET S)

/6/Not attached and not found.

This being the case I can only conclude that Marcos has chosen to use this rather elaborate method to bring to the President's attention through Locke that he really wants equipment for three more ECB's as part of the asking price for any augmentation of Phil forces in Vietnam, the other elements--as of now--being the Subic-Clark road, the Clark by-pass road and a right of way through Clark for the latter.

With respect to Subic-Clark we are trying to dig out more background but believe this harks back to the Pablo Roman scheme of several years ago (participated in then by our friend De Venecia) which was abandoned when our military decided to build the Clark-Subic pipeline. The other road, as proposed by Melchor, the Pentagon is now presumably looking at. The Clark right of way they probably want under any circumstances and may thus be a separable element in the package.

No one of course in the absence of actual feasibility studies has any real idea of the price tag on either of the roads. Even Melchor's figure seems to be only a wild guess. The U.S. contractor bit, I suspect, is simply thrown in as a sweetening ploy to make it look as if they were concerned with our dollar outflow problem and to suggest indirectly the possibility of EX-IM or AID financing. It seems from a practical standpoint to be a non-starter. What they would undoubtedly like is something approaching the arrangements they have probably heard of in Northeast Thailand, where DOD picks up the tab on certain roads on the basis of U.S. military requirements. Beyond this and as successive fall off positions I imagine they would like us to pick up at least dollar costs on whatever roads might be eventually agreed upon as part of the quid pro quo arrangement.

All this being said, I am still trying to analyze why Marcos chose this particular means to surface his proposals. The De Venecia proposals clearly were nothing more than a cover for Marcos' own independent move. (All the cabinet members who sat around with me while Marcos talked to Locke in the next room were armed incidentally with De Venecia's 30 page briefing book covering his projects, none of which were even mentioned.) The methodology is of course typical of Marcos, but why he went to such lengths on this including the elaborate hospitality showered on the Lockes remains something of a puzzle.

One guess is that he harbors some idea that Locke might be the next Ambassador here (Kokoy mentioned this possibility to Rafferty) and wanted to look him over. Or Marcos might be using this to signal the idea that he would prefer to do business with a new Ambassador who is close to the throne at home/7/ in order to continue the same sort of personal diplomacy he tried with Kokoy in Washington. It's even possible he had in his mind a bit of a reverse nudge in terms of having us look over Elizalde to see if he would have the same kind of personal access to our President that he would like to see here.

/7/Before Dallas lawyer Eugene Locke was Ambassador to Pakistan and then Deputy Ambassador to Vietnam, he was Chairman of the Texas Democratic Committee.

This is of course only speculation, but with a fellow as complex as Marcos almost anything is possible. I doubt if he would go to all the trouble to getting Locke over here just to tell him about the ECB's, since he told Jorden the same thing the same day, and the rest of it could very easily have been handled with Bill Blair before he left, with me, or by private letter to the President. I need hardly add that from the standpoint of my own future relations here in the inter regnum I trust that the replies to all of these queries come back to Marcos through normal Embassy channels. We will of course keep in close touch with Saigon on any developments there, and I've also made it a point to keep Bill Jorden fully read into this here. He will undoubtedly be in touch with you on it shortly after he gets back.

All the best.




360. Editorial Note

On Saturday, November 4, 1967, at 2:20 p.m. President Johnson met with Secretaries Rusk and McNamara, Special Assistant Rostow, Director of Central Intelligence Helms, Press Secretary George Christian, and Special Assistant Jim Jones for a luncheon meeting. The lunch took place in the West Sitting Room of the White House. In the early part of the meeting, President Johnson asked if Eugene Locke could fill the post of Ambassador to the Philippines (Ambassador Blair had left on October 24). The President expressed worry about the Philippines, stating, "I feel it in my bones that there is going to be a problem there." The President remarked that he trusted Locke, but perhaps he was too close to the President to be placed in the position of Ambassador to the Philippines. The remainder of the conversation, which lasted until 3:55 p.m., did not relate to the Philippines. (Memorandum from Jones to the President, November 4; Johnson Library, Meeting Notes File)


361. Memorandum Prepared for the 303 Committee

Washington, November 20, 1967.

[Source: National Security Council, Special Group/303 Committee Files, Subject Files, Philippines. Secret; Eyes Only. 1 page of source text not declassified.]


362. Intelligence Memorandum Prepared in the Central Intelligence Agency/1/

No. 1679/67

Washington, December 7, 1967.

/1/Source: Johnson Library, National Security File, Country File, Philippines, Vol. IV, Memos, 8/67-11/68 [2 of 2]. Secret; No Foreign Dissem. A note on the memorandum indicates that it was prepared by the Office of Current Intelligence and coordinated with the Office of National Estimates and Clandestine Services. Rostow sent this memorandum to the President on December 16. There is an indication of Rostow's transmittal note that the President saw it and the memorandum. This memorandum was distributed in a slightly more detailed version as a "Special Weekly Review," entitled "Philippine President Marcos at Midterm," SC No. 00801/67B, December 22. (Ibid.)



The recent electoral successes of his Nacionalista Party have left President Marcos in a strong political position after two years in office. Increased control at both national and provincial levels should enable him to make greater progress in his reform and development programs if he is so inclined.

The problems he faces are serious ones, however, involving the strains of rural poverty and urban unemployment, rising lawlessness, and growing pressures from an emerging generation alienated from the tradition of their parents and seeking a more distinct national identity. Marcos' willingness and ability to overcome the foot-dragging of a powerful conservative oligarchy and to satisfy some of the demands of increasing nationalism will have an important effect on his political future.

Marcos' Political Strength

1. After two years in office, President Fernando Marcos of the Philippines has shown remarkable political strength, as reflected in the success of his Nacionalista Party in the recent off-year elections./2/ Marcos campaigned vigorously for Nacionalista candidates for local and provincial positions, realizing that grass-roots support would be vital both in implementing his development programs and in marshalling support for his bid for re-election in 1969. His efforts were repaid when, according to unofficial returns, his party gained 48 out of 65 governorships and nearly three fourths of other provincial, municipal, and local offices in elections marred by violence, corruption, and inefficiency. In the Senate, whose members are elected at large, the Nacionalistas took six of the eight contested seats, and a pro-administration independent gained a seventh, leaving the opposition Liberals with just one Senate victory.

/2/INR prepared an Intelligence Note for Rusk on the election. Based on 90 percent of election returns, INR concluded that "the election was marred by violence, inefficiency, and large scale disenfranchisement. Nevertheless, it constituted a clear mandate for Marcos' 'rice, roads, and schools' program and is another step toward his goal of re-election in 1969." (Memorandum from Hughes to Rusk, Intelligence Note 931, November 22; National Archives and Records Administration, RG 59, Central Files 1967-69, POL 14 PHIL)

2. The glow of victory was somewhat dimmed by the outstanding showing of the Liberal senatorial candidate, Benigro Aquino, ex-governor of Tarlac Province and a vigorous opponent of Marcos, and by the re-election of Manila's Liberal mayor, Antonio Villegas, whose penchant for anti-American nationalism has often proved embarrassing to the administration. As Marcos had personally chosen and vigorously campaigned for Villegas' opponent, the mayor's victory was particularly galling.

3. The elections have left Marcos with increased numerical support both in the provinces and in the legislature (the Senate now includes 15 Nacionalistas, seven Liberals, one Nationalist Citizens Party member, and one independent), which should put him in a better position to carry out the reform sures and development programs the country so desperately needs. The highly centralized nature of the Philippine Government will facilitate the President's control over his provincial adherents. His ability to control the legislature, however, is less certain. Philippine politicians have traditionally switched allegiance when they believed it was to their political advantage. The Liberals, for example, gained control of the Senate last January through the defection of four Nacionalista senators. Obligations incurred in the recent election, as well as attempts to ensure future backing for his re-election bid, may also diminish Marcos' enthusiasm for pushing through reform legislation, a subject which--in any case--is not popular with the generally conservative oligarchy that controls Philippines politics. Marcos' primary goal, above all else, is to be the first Philippine president to be re-elected, and he can be expected to make any political compromises to achieve this end.

The Nation's Problems

4. Marcos is still faced with the myriad of troubles that beset the country when he was elected and has so far accomplished rather little in resolving them. A vast and growing gap exists between the wealth of the few and the poverty of the many. The peasant farmer's subsistence-level existence has been perpetuated by backward agricultural methods, inadequate irrigation, and high loss from uncontrolled pests, particularly in the important rice-growing areas. Initiative for improvements has been discouraged by a feudalistic system of land tenure and by a traditional suspicion of innovation. Progress in land reform and rural development has been generally slow, hampered both by bureaucratic inefficiency and by the interference of landlords who are powerful supporters of both major parties.

5. Because of unsatisfactory standards of living in rural areas, migration to urban areas, especially Manila, has expanded rapidly in recent years. The rapidly growing urban populations have intensified pressures on municipal facilities and services, which are unable to keep pace with the expanding slums. Even though a growing economy is providing increased opportunities, it has not kept pace with a rapidly increasing population. Serious unemployment and more widespread under-employment have resulted. Despite this vast reserve of labor, the demand for skilled manpower to meet growing industrial needs cannot be met. Government neglect in providing training schools or in encouraging technical education has only recently been recognized, and manpower planning and technical training programs have begun to receive attention.

6. Efforts to institute the necessary reforms have been undercut by corruption, inefficiency, and nepotism in the political structure. Public office continues to be used to further personal or family fortunes. An official dispenses jobs and favors, not in the public interest, but to satisfy obligations to those people tied to him through the complex familial or patronal relationships that characterize Philippine society. Marcos, himself, is partly responsible for the continuing inefficiency by his desire to maintain tight personal control over the government's activities and his reluctance to entrust even minor decision-making to subordinates. His veto of the decentralization bill, which would have allowed much-needed flexibility and initiative at the local level, was a reflection of this need to control the game.

Marcos' Attack on the Problems

7. Marcos' initial program to initiate development, fight lawlessness, and suppress smuggling and corruption met with only limited success. Perhaps having lost some of his taste for jousting with the powerful figures involved, he has narrowed his efforts to emphasize "rice, roads, and schools" as the major goals of his administration. The Philippines' need to import five to ten percent of its rice requirements each year has been a serious drain on foreign exchange. Marcos' goal of achieving self-sufficiency in rice will hopefully be fulfilled by 1970 by means of an intensive program to introduce the improved strain of rice, IR-8. With the receipt of US equipment for five additional army engineering construction battalions, bringing the total army engineering strength to eight battalions, the government launched a vigorous road construction program, which by last June had completed some 700 kilometers of new roadway. The school building project has also received considerable US assistance through the Special Fund for Education and is progressing "satisfactorily."

8. Central Luzon has been a special target for the government's de- velopment efforts. Operation Central Luzon (later called the Central Luzon Development Program) was launched to undercut the growing influence of the pro-Communist Huks in this traditionally depressed area. There is no indication that any serious impact has been made on the poverty and injustices of life there, although increased rice production may stimulate some improvement, and the power of the Huks has not been curbed.

The Role of the Huks/3/

/3/INR prepared Intelligence Notes for Rusk on the Huks/Peoples Liberation Army at the midterm election. In Note 830, October 18, INR suggested that Marcos would not move militarily against the Huks until after the presidential elections of 1969 or even the off-year elections of 1971 because he needed their political support at the local level in Central Luzon. (Ibid., POL 23-7 PHIL) In Note 850, October 26, INR analyzed Huk political power in central and western Luzon and concluded that by running its own candidates in most races it would prove the difference between defeat or victory. INR suggested that Huk political influence would grow after the elections. (Ibid., POL 14 PHIL)

9. Huk influence is sustained in part by the collaboration of local officials and politicians who recognize the Huk ability to control the vote, in great part through intimidation. To some extent, the Huks have also been able to project a Robin Hood image among peasants disgruntled over bad government and impoverishment. The recent elections served to stimulate their activities and probably helped to solidify their position. The estimated number of armed Huks is still a relatively modest 140. However, these are supported by up to 30,000 sympathizers. Insurgent operations continue to center on the provinces of Tarlac and Pampanga, and reported efforts to expand to other areas have apparently been unsuccessful.

10. Marcos has vacillated between a harsh line against the insurgents and vague gestures of amnesty. The President's support of the constabulary's efforts against the Huks has been inconsistent, but just prior to the recent election he encouraged the constabulary to intensify its effort. Several Huk leaders were either captured or killed, but these successes may result in Huk reprisals. Particularly distressing has been the evidence of M-16 rifles in Huk possession. It remains to be seen how long Marcos will sustain the pressure, but his electoral successes and a recent, particularly daring Huk ambush are reported to have prompted him to order the constabulary to redouble its efforts.

11. Little is known of the strength of Communist ideology in the present Huk movement, but their ties with the urban-based remnants of the Communist Party (PKP) appear tenuous. Although there have been meetings between the urban leftist leaders and the Huk commanders, the pro-Communist urban fronts have also made attempts to develop a rural following independent of the Huks, most notably through the peasant front, the Masaka (Free Farmers Association). The growth of this organization, still in its incipient stages, might ultimately provide a better indication than the Huks of the Communists' ability to exploit rural poverty and unrest. These urban fronts, however, are themselves in a weakened and divided stage. Continually splintering into overlapping or competing groups, they presently are engaged in an internal struggle between the older, pro-Soviet cadre and the younger, Peking-oriented radicals. Lacking discipline, forceful leadership, and funds, they represent no current threat to the government.

The Radical Nationalists

12. A more serious problem is the pressure from the radical nationalists, particularly in the younger generation, who seek to cultivate a more Asian identity and resent any overtones of American domination--political, economic, or cultural. These younger Filipinos, who make up an increasing percentage of the electorate, do not share the sentimental ties to the US that many of their parents still have and are resentful of any indication of what they believe to be American paternalism or privileges. Marcos' apparent lack of interest in establishing support with this group has been puzzling. Despite his obvious political nerve, he has neither seriously attempted to bid for their support nor tried to channel their excessive national pride into useful directions. When Marcos has dealt with the young radical intellectuals at all, it has been in indirect attempts to undercut their activities.

13. US military bases and economic relations are the usual targets of nationalistic frustrations; the government's actions occasionally reflect its sensitivity to these pressures. Most Philippine leaders readily acknowledge the necessity of the American bases and their importance to Philippine security, but the desire to be accepted in the Asian community and a sensitivity to charges of American dominance cause underlying tensions which occasionally erupt. Sporadic assertions of sovereignty take the form of disputes over jurisdictional rights, labor, natural resources, or the administration of customs, immigration, and health regulations on bases.

14. Economic nationalism has been manifested primarily in the persistent attacks on the Laurel-Langley agreement, viewed by the radical nationalists as economic imperialism. Preliminary talks regarding future arrangements after the agreement expires in 1974 have already shown the Philippine desire for a protected position in the American market but an unwillingness to allow reciprocal preferences. Marcos has always been aware of the Philippines' need for foreign investment and has sought to attract it, but he has also been periodically stymied by the maneuverings of the nationalists, as during Mayor Villegas' attack earlier this year on American retail trade in the Manila area. As presidential elections loom on the horizon, Marcos may find it politically expedient to take a harsher line toward future economic ties.

Foreign Associations

15. Marcos has often shown a sensitivity to criticism of too close an association with the US. He has justified his support for the American position in Vietnam and for the Philippine contribution to the war effort by citing the resulting American aid for his domestic development programs. In his desire to establish his identity as an Asian statesman, independent of American control, he has attempted to initiate peace proposals that have only served to arouse the annoyance and mistrust of his Asian allies. This striving for an independent image has also involved a growing interest in developing trade and cultural ties with Eastern Europe, but the government has been cautious in pursuing them. Prominent Filipinos have visited bloc countries in increasing numbers, though without official recognition. China, however, is still viewed with great alarm, and contact has been very limited. Marcos continues to regard the American presence in Asia as absolutely vital, but publicly acknowledges this less frequently.


16. In general, the Philippines situation reflects the inability of a rural, agricultural economy, feudalistically structured, to support a rapidly expanding population, and the failure of a slowly expanding industrial sector to meet job requirements for increasing urban masses. The problem facing any Philippine government is, in some way, to persuade or manipulate the conservative elite to accept the political and economic reforms necessary to stimulate the economy. Unless the peasant farmer and the urban slum dweller are persuaded that the present system can respond to their needs, their growing apathy could in time turn to rebellion. As the post-war generation becomes more prominent on the scene, the government must also respond to growing nationalist pressures, which will probably involve loosening traditional ties with the US in the search for a distinctive identity.


363. Intelligence Note From the Director of the Bureau of Intelligence and Research (Hughes) to Secretary of State Rusk/1/

No. 223

Washington, March 26, 1968.

/1/Source: National Archives and Records Administration, RG 59, Central Files 1967-69, POL 23-7 MALAYSIA. Secret; No Foreign Dissem.

Malaysian Reaction to the Disclosure of Philippine Plans to Subvert Sabah

Malaysia, long aware through its own intelligence service, of the Philippine clandestine training program for subversion in Sabah, has been prompted to formal diplomatic protest by the public disclosure of the training camp at Corregidor./2/ Although incensed by Philippine behavior, Kuala Lumpur continues to hope that Manila's response will permit the maintenance of diplomatic relations./3/

/2/In Intelligence Note 226, March 27, Hughes informed Rusk in more detail about the Corregidor Clandestine Camp. (Ibid., DEF 6-5 PHIL)

/3/The Philippine claim to Sabah, pending since 1962, was an irritant to Malaysian-Philippines relations even after the Philippines recognized Malaysia in 1966. In 1963, under the Maphilindo agreement, the Philippines and Malaysia were committed to resolving the dispute by peaceful means. (Intelligence Note 27 from Hughes to Rusk, January 10; ibid., POL 32-1 MALAYSIA-PHIL)

Malaysian Efforts to Kill the Philippine Plan. The Malaysian government has known since May 1967 through its own intelligence service that the Philippines was involved in preparing a program for infiltration and subversion in Sabah in support of the Philippine claim there. Early in December, Malaysia learned that Philippine guerrillas were being trained in the southern Philippines. While top Malaysian officials were incensed that an ostensibly friendly country and a fellow member of the recently created Association of Southeast Asian Nations would plot to subvert a part of their territory, they were confident that their own security forces could repel any Philippine subversion effort and that the political situation in Sabah was not susceptible to Philippine influence. The Malaysians hoped that, by quietly making known their awareness of the Philippine plans, they could persuade the Philippine government to drop the project, thus preventing any rupture in Philippine-Malaysian relations.

Malaysia's Formal Protest to the Philippines. The unexpected revelation of the secret Philippine training program at Corregidor, which was given wide publicity in the Philippines and Malaysia coincident with the arrest of twenty armed Filipinos attempting to enter Sabah illegally, persuaded the Malaysian government that it must take formal if low-key notice of the Philippine program. On March 23, accordingly, a protest note was handed to the second secretary of the Philippine Embassy by a medium level official. The note stated that Malaysia took the news of the Corregidor camp "most seriously in view of the recent arrest of more than twenty Filipinos with arms . . . who were unable to explain their presence in Sabah." Malaysia would have "no alternative but to regard such activities as a most serious breach of good faith and friendly relations" and requested "a full explanation." The Malaysian note also said that Malaysia had instructed its representative at the UN to bring the matter to the attention of the Secretary General.

Malaysia was not reassured by Philippine reaction to its note, even though Foreign Secretary Ramos told the Malaysian Ambassador that the Philippines was "not trying to instigate a revolt in Sabah" and that the Philippines would answer the Malaysian note soon "in a friendly, moderate tone." It was clear that the Philippines was annoyed that the Malaysians were reporting to the UN Secretary General. One Philippine diplomat called this action "presumptuous" and said Malaysia was elevating the issue unnecessarily. The Malaysians were further disturbed when Marcos and Ramos insisted that the Corregidor training camp had been established for counterinsurgency training following reports of communist activities in Mindanao and the Sulus and when Manila in its secret reply to Malaysia's note accused the Malaysians of infiltrating the Philippines from Sabah. On March 25, the Malaysians issued a statement demanding that, in the interests of friendly relations between the two countries, the results of both President Marcos' and the Philippine Congress' investigations of the Corregidor training program be made public and describe the objectives of the training.

Prospects for Philippine-Malaysian Relations. The Malaysian government hopes that, having presented its low-key formal protest to Manila, no further diplomatic action on its part will be necessary and that it will not be pushed toward a break in diplomatic relations. Its ability to maintain this policy depends, however, on the Philippine diplomatic response, on Malaysian press and public reactions to the further revelations that may result from the official investigations of the training program, and on the reverberations produced in the Philippines by these investigations.


364. Information Memorandum From the President's Special Assistant (Rostow) to President Johnson/1/

Washington, April 10, 1968, 3:35 p.m.

/1/Source: Johnson Library, National Security File, Country File, Philippines, Vol. IV, Memos 8/67-11/68 [1 of 2]. No classification marking. A note on the memorandum indicates that the President saw it.

PHILCAG--and your message to Marcos

Your message to Marcos urging him to stand fast on PHILCAG/2/ appears to have served its purpose. Embassy Manila reports that "the President's letter has served to give Marcos a much needed shot in the arm on PHILCAG, and hopefully he will follow through with a major effort to win the necessary votes for a bill "which will preserve PHILCAG's essential integrity."/3/

/2/The text was transmitted in telegram 14368 to Manila, April 9. (National Archives and Records Administration, RG 59, Central Files 1967-69, POL 27-3 VIET S)

/3/As reported in telegram 9252 from Manila, April 10. (Ibid.)

Our Embassy cautions, however, that it will not be easy. Marcos has asked our Embassy to approach three specific senators who have proved unresponsive to Marcos' efforts. Our Embassy will be doing so in the next several days./4/

/4/Also reported in telegram 9252 from Manila.

We left to Marcos the choice of releasing the text of your message to the public and he wants to assess the tactical situation before deciding to use it publicly to counteract the fairly widespread impression in the Philippines that the United States is backing out of its South Vietnamese commitment. If he does choose to release we have asked for 24 hours notice to permit simultaneous release here, if desired.

In sum, the situation on PHILCAG is looking up--but we are not out of the woods yet.



365. Information Memorandum From the President's Special Assistant (Rostow) to President Johnson/1/

Washington, April 30, 1968.

/1/Source: Johnson Library, National Security File, Country File, Philippines, Vol. IV, Memos, 8/67-11/68 [1 of 2]. No classification marking. A note on the memorandum indicates that the President saw it.

Meeting with Governor G. Mennen Williams, May 1--5:30 p.m./2/

/2/The President met with Williams very briefly on May 1 from 5:43 to 5:45 p.m. (Ibid., President's Daily Diary) No other record of their short conversation has been found.

Governor Williams is in town in connection with his appointment as Ambassador to the Philippines. He is appearing before the Senate Foreign Relations Committee on the morning Friday, May 3.

Attached is a Talking Paper prepared for you by the Department of State for your meeting with Governor Williams./3/ In brief, it suggests that you stress:

/3/Undated; not printed.

1. the necessity for the Philippines maintaining their PHILCAG force in South Vietnam.

2. the importance of the Philippine Government taking a more liberal approach to foreign investment, both in their own interest and as a necessary step to a successful re-negotiation of our current economic relations agreement with them (Laurel-Langley).

3. our intention of keeping our AID programs to the Philippines at a relatively modest level (1968 MAP program is $21 million and the 1968 AID program is about $20 million).

4. our concern at the continuing lack of law and order in the Philippines and its inhibiting effect on the confidence of the mass of the people in the ability of the Philippines to meet its problems through existing domestic political structure.



366. Action Memorandum From the President's Special Assistant (Rostow) to President Johnson/1/

Washington, May 18, 1968, 1:50 p.m.

/1/Source: Johnson Library, National Security File, Country File, Vietnam, 5 D (2), Allies: Troop Commitments and Other Aid, 1967-69. No classification marking. A note on the memorandum indicates that the President saw it.

Reduction of size of Philippine military force in Vietnam (PHILCAG)

President Marcos has been having trouble for several months in getting from his Congress an appropriation to cover PHILCAG. Marcos and other Philippine officials have repeatedly told our Embassy it might be necessary, in view of the Congressional pressure, to reduce the size and change the composition of PHILCAG (for instance medical units instead of engineering battalions).

We have made a vigorous effort, including your letter of April 14,/2/ to persuade Marcos to maintain the size and the integrity of PHILCAG. On several occasions he has assured us, and has stated publicly, that he would do so.

/2/Not printed. (Ibid.) See also footnote 2, Document 364.

Nonetheless, withdrawals have taken place. From an original strength of 2,050, PHILCAG is down to 1,810. The Philippine Secretary of Defense and Armed Forces Chief of Staff have now informed our Embassy that they are planning a weekly reduction of 35 men until PHILCAG is reduced to a strength of 1,400. That would constitute a better than 30% reduction from the original PHILCAG strength.

Attached is an extremely stiff cable to our Embassy in Manila authorizing the Embassy to find out if the reduction has Marcos' approval./3/ If so, the telegram authorizes/4/ our Charge in Manila to speak in very blunt terms to Marcos about the dim view we take of this development. Among other things, the message says that we will suspend further shipments of equipment for Philippine army engineer construction battalions (a matter of great personal interest to Marcos and a program which stems from his visit with you in 1966). We also plan to suspend activity regarding procurement in the Philippines of our needs in Vietnam (another matter stemming from the communiqué issued at the end of Marcos' visit with you). Finally, the cable raises the possibility that at some point the reductions of PHILCAG might render the Philippines ineligible to sit in the councils of troop-contributing countries to Vietnam.

/3/The draft cable is attached to a memorandum from Read to Rostow, May 11. (National Archives and Records Administration, RG 59, Central Files 1967-69, POL 27-3 VIET S)

/4/Rostow wrote the following note at this point: "Not: instructs. See final para."

The cable has been personally cleared by Secretary Rusk.

But I have my doubts that this cable will do the job. In the first place our Charge in Manila is not at all likely to go as far with Marcos as this cable will permit him to go. The cable should serve, however, to clarify Marcos' intentions and precipitate a dialog with our Mission on the best approach to the problem of keeping PHILCAG intact. Eventually, we may want to resort to another letter from you. That, however, depends on Marcos' reaction, and this cable is a necessary first step.

One good reason for precipitating this issue without delay is to try to get it out of the way before Mennen Williams arrives in Manila, in about a month.

There is one danger in this of which I think you should be aware. Thus far, the reduction of PHILCAG has taken place with virtually no publicity. Manila is a sieve, and a tough approach by us will probably become known and focus publicity on the PHILCAG reduction. However, that is sure to happen anyway, sooner or later. I think it is time to bite the bullet with the Philippines.

I recommend you approve the cable. Whether or not you approve you might want to discuss the problem at the Tuesday luncheon.


Put on Tuesday lunch agenda/5/
Call me

/5/The President checked this option and wrote the following instructions: "Ask Clifford & Rusk to study very carefully. L." At the Tuesday lunch meeting on May 21, attended by President, Rusk, Clifford, Wheeler, Helms, Rostow, and Christian, with Tom Johnson taking notes, the issue of the Philippines engineering unit was discussed. Wheeler noted that the Philippines could not support the unit until June and Clifford stated that the Philippines wanted to reduce it from 1,800 to 1,400. Wheeler remarked that a seventy man reduction per week, as contemplated, "isn't getting much attention." The President moved on to the question of Korean troops in South Vietnam. Presumably the reduction was accepted and the cable was never sent. (Notes of a Tuesday Lunch Meeting; Johnson Library, Tom Johnson Notes, 5/21/68)


367. Action Memorandum From the Assistant Secretary of State for East Asian and Pacific Affairs (Bundy) to Secretary of State Rusk/1/

Washington, May 20, 1968.

/1/Source: National Archives and Records Administration, RG 59, Central Files 1967-69, POL 18 MALAYSIA. Secret. Drafted by Ruth A. McLendon (EA/PHL) and cleared by EA, EA/PHL and in draft with EA/IND, EA/MS, EA/TB, and EA/RA.

The Sabah Dispute and ASEAN


As you will recall, at the luncheon May 9, Foreign Minister Thanat raised the question of the Philippine-Malaysian dispute over Sabah and his concern that the dispute may disrupt the ASEAN ministerial meeting in August. Thanat plans to reason with both parties before the bilateral talks on Sabah open in Bangkok June 17. He would like us to persuade President Marcos to cool off the quarrel. We did not at the time so inform Thanat, but we have told the Filipinos informally, when they mentioned the issue, that we thought they should quiet the matter. (See Manila 8618 and State 136076 attached at Tab B.)/2/

/2/Both attached but neither printed.

After giving the matter further thought, and discussing it with the Country Directors in EA, I believe that we should continue to avoid active intervention in the Sabah dispute, and to avoid initiating discussions on this issue with any of the interested governments. In arriving at this conclusion, I considered the following points:

(1) Seriousness of Present Impasse--We expect the Bangkok talks on Sabah to fail, with mutual recriminations. Malaysia intends to reject the Philippine claim outright and to refuse a second round of talks, even if (according to one senior Malaysian official) the Philippines react by breaking diplomatic relations again. The Malaysians also plan to stage a military demonstration in Sabah while the bilateral talks are going on. On the Philippine side, President Marcos is reported to have reversed the moderate line urged by Foreign Secretary Ramos, and the Department of Foreign Affairs is now taking a "second hard look" at the relative priorities of regional cooperation and the Sabah claim.

(2) Sabah as a Southeast Asian Problem--We have told both the Filipinos and the Malaysians that we consider Sabah primarily a problem which they will have to work out for themselves. Other members of ASEAN, working separately or jointly, may be able to help them work out a face-saving compromise, or to persuade them at least to try to contain the dispute in order to minimize the damage to regional cooperation. I believe that advice or pressure from outside powers, however well-intended, would only weaken the sense of responsibility of ASEAN members for handling their own affairs, and that at this point, we can best encourage the development of ASEAN by standing aside and letting the member states decide for themselves how to deal with the potential threat posed by the Sabah dispute.

(3) U.S.-Philippine Relations and Philippines in Southeast Asia--I believe that it would be unwise especially for the U.S. to attempt to guide or influence the Philippines on this issue. Such a move would encourage the Filipinos' tendency to draw us into their affairs and then to consider us responsible for the situation. It would also reinforce the view held by other Southeast Asian nations that the Philippine Government cannot be dealt with as a responsible Government, but must be approached through Uncle Sam, who will keep them in line. If the Philippines is to play a responsible role in Southeast Asian affairs, Fililpino leaders must learn to conduct their affairs without guidance from us, and to bear the consequences of their mistakes.

The attached telegram (Tab A)/3/ would instruct Bangkok to follow up the luncheon conversation of May 9 with Thanat with a fuller discussion of the Sabah issue, and to outline an appropriate portion of the reasoning I have given above. Other addressees would be authorized to draw on the message in discussions with interested officials, but not to raise the Sabah question independently.

/3/The draft telegram is attached, but is not printed. According to a handwritten note, Rusk approved its transmission and it was sent on May 21 at 12:30 p.m.


That you sign the attached telegram to Bangkok concerning the Sabah dispute.


368. National Intelligence Estimate/1/

NIE 56-68

Washington, June 20, 1968.

/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.


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.


A. 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.

/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.)

B. 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/

/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.)

C. 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.

D. 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.]


369. Telegram From the Embassy in the Philippines to the Department of State/1/

Manila, July 25, 1968, 0510Z.

/1/Source: National Archives and Records Administration, RG 59, Central Files 1967-69, POL 32-1 MALAYSIA-PHIL. Secret; Immediate; Exdis. Repeated to Bangkok, Canberra, Djakarta, Kuala Lumpur, and London.

13219. Subj: Sabah dispute.

1. Sabah matter discussed fairly intensively between Pres Marcos and Bundy at meeting afternoon July 24./2/ Because of extreme sensitivity this subject and speculation this conversation in particular all posts should handle this report with great care. For public purposes Marcos agreed with Bundy that latter should adhere to absolute "no comment" position throughout his trip on the whole subject of Sabah, including the question whether the topic had even come up with Marcos or with GOP officials. Question of disclosure to friendly governments addressed below for appropriate instructions and action by Department.

/2/William Bundy had attended the Honolulu Conference between Presidents Johnson and Thieu of South Vietnam. After the conference, he visited U.S. allies in East Asia, including the Philippines, for consultations. In telegram 8708 from Seoul, July 23, Bundy asked for advice for his meeting with Marcos on the Sabah question. Bundy stated he was inclined to have "a heart-to-heart" and recalled that Rusk had told him to "make it crystal clear that if there were to be any conflict [over Sabah] whatever, they [the Philippines] could count on nothing from us." Bundy proposed "to be extremely frank and tough with Marcos alone, but not to spread the word." (Ibid.) The Department concurred in telegram 20694 to Manila, July 23. (Ibid.)

Following Bundy's report on Honolulu meeting and general status in SVN, Marcos himself raised the subject of Sabah (setting, incidentally, was totally private, with airconditioner drowning out any listening ears). Marcos' opening remarks made following points:

A) He noted that claim had been made before he came into office and that his own party had been divided on it;

B) Nonetheless, matter had assumed major importance in the Philippines, and he felt obligated to keep it alive;

C) A week before the ending of the Bangkok talks, GOP had thought it had understanding with Razak the talks would be ended on the note that neither side had convinced the other, but that discussions would continue in some form after an unspecified period of recess. Unfortunately, sharp Malaysian behavior and outright rejection of claim had produced situation in which his Foreign Policy Council had been inclined to recommend immediate military action. He had held this off, and had limited GOP reaction to withdrawal of all but one represent- ative in KL;

D) He volunteered that he was completely opposed to any military action and would indeed "take the issue to the country" if necessary to prevent this. At the same time, he said that Muslim feelings in neighboring areas ran high and that there might be some private raids that he could not control;

E) In conclusion, he expressed the hope that USG could act to produce "more civil" attitude by GOM, again making clear that he felt major need to keep the issue alive and at least apparently under serious discussion. He also mentioned ICJ, but without pressing it.

2. In reply, Bundy made following points:

A) USG had not been, and would not become involved in dispute on either side. We took no position on the merits of the claim or on responsibility for the breakup of the Bangkok talks. We felt it essential to adhere to this position. (At the same time, Bundy remarked that when claim had first been raised, he had expressed clear private views on it--unstated but clearly implied to be negative--but would not do so in present circumstances. He also noted that there was "widespread impression" that closing phases of Bangkok talks had been affected by the "rather crisp" presentation of Ambassador Guerrero. Marcos obviously took in both points, but did not pursue them.);

B) At the same time, we did feel it right to convey to Marcos the serious effect that failure to "damp down" the dispute would have on American public support for U.S. policy in SEA. Bundy referred back to reference he had already inserted in discussions of Honolulu meeting to the fact that such public support was currently threatened, as never before, and that there was serious danger of its erosion. In this context, Bundy noted, serious dispute between two friendly nations and key members of ASEAN could have serious negative consequences in terms of U.S. public and Congressional opinion;

C) Bundy went on that any resort to military action would be disastrous in the same context. We welcomed Marcos' clear statement on this aspect, and Bundy said we would have had no doubt that this was GOP position (sic), and that we were equally confident that any measures GOM might take would be defensive in character (no reference was made to any specific items of evidence, other than "inevitable rumors", nor did Marcos follow up or mention any specific items.);

D) In line with Marcos' desire to keep the matter under discussion, we continue to feel that any USG role would be most unwise, but equally felt that Asian friends of both parties might play useful role particularly in the corridors at the forthcoming ASPAC and ASEAN meetings. Bundy particularly noted that both Thai and Indonesia were interested and objective nations and also referred to Korean concern expressed to Bundy in Seoul--noting that Bundy had suggested side discussions in Canberra and also that we did not believe ROKG itself knew enough about the matter to be really helpful.

3. Marcos took all this in good part. His manner throughout was sober, and gave impression not merely of saying the right things but of meaning them. Discussion flowed easily and with apparent clear understanding.

4. Other discussions during Bundy visit, with Mrs. Marcos and with Ramos, appear to make clear that: A) GOP does regard non-withdrawal of GOM Ambassador in Manila as a conciliatory gesture; B) Ramos definitely plans to attend Canberra and Djakarta meetings personally, and specifically mentioned his hope for quiet discussions with Razak on these occasions; C) Mrs. Marcos' statement on local political pressure from the heirs of the Sultan of Sulu and from student elements seemed unconvincing. Likewise Marcos' reference to potential revolt in "southern Mindanao"--which he did not amplify--struck a hollow note to us. Nonetheless, Mrs. Marcos made more political sense in referring to attacks by newspapers and opportunist opposition elements--and we surmise that this is the core of the matter here.

5. In sum, we believe that private conversation can have left Marcos in no doubt (A) that we were not going to become involved and that we are looking to Asian friends to help; (B) that our objective judgment was that continued crises on this issue would have serious negative effects on our ability to continue policies of President Johnson, which we believe to be supported in essence by the most likely successors.

6. Department will wish to instruct key posts on how to handle this discussion in local capitals. Bundy instinct is that Australians and perhaps British should be told full position for their own knowledge only, with explanation that this line of argument seemed to us the one likely to be most effective here and at same time least susceptible to negative consequences. We would think our disclosure to KL, if any, should be more limited. We might be able to go further in private talks with Malik and Thanat.

Bundy would propose to explore Thanat's feelings and views at planned dinner tonight in any event, and to throw out lines of thought suggested in Deptel 208279./3/

/3/In telegram 208279 to Manila, Bangkok, and Djakarta, July 24, the Department suggested that the ASEAN Ministerial meeting offered the best prospect for reopening negotiations on Sabah and wondered if a study group under ASEAN reporting to the group might be the best mechanism. (Ibid.)

7. What is most vital, from every standpoint, is that there should be no report that could possibly leak to the effect that we had had put "pressure" on the GOP. This would be the one thing that could really undo things here, both in terms of possible effect on GOP behavior and in terms of our wider relations and interests.



370. Telegram From the Embassy in the Philippines to the Department of State/1/

Manila, October 2, 1968, 0947Z.

/1/Source: National Archives and Records Administration, RG 59, Central Files 1967-69, POL 32-1 MALAYSIA-PHIL. Secret; Priority; Limdis. Repeated to Bangkok, Canberra, Djakarta, Kuala Lumpur, London, Singapore, Wellington, USUN, and CINCPAC.

15828. Sabah: U.S.-Philippine relations. Ref: Manila 15756./2/

/2/In telegram 15756, October 1, the Embassy presented its "best current estimate on the Phil attitude towards Sabah." It believed the issue was in danger of becoming a "national cause," exacerbated by the widespread public perception that the United States favored Malaysia's claim. The Embassy suggested that Sabah provided Marcos with a potential issue to distract attention from his domestic problems and distance himself from the United States, but he was not considering a military showdown with Malaysia. (Ibid.)

1. It is a truism that U.S.-Philippine relations are in many ways unique. With no other nation in Asia do we share the same closeness of sentimental and emotional ties. Nowhere else in Asia do we have such a visible and overwhelming political, military and economic presence. Only Thailand rivals the Philippines as a base of support for our military effort in Vietnam. All these factors create a network of ties which makes it impossible to divorce actions of the GOP from its relations with the U.S. The Philippine dispute with Malaysia over Sabah has, therefore, an unavoidable effect on our bilateral relations.

2. As reported reftel, there has been a strong emotional reaction to what many Filipinos view as a rejection and repudiation by the U.S. The reflex reaction was a desire to punish the U.S. expressed in demands for PHILCAG withdrawal, modification or termination of the bases agreement and renegotiation of the defense treaty. While the British and Malaysia got their lumps, the focus of most of the demonstrations was against the U.S. The demonstration Sept 30 at Clark Air Base, the restriction of military overflights and landing rights, customs harassment in the port of Manila are further manifestations of GOP displeasure.

3. If President Marcos should decide to follow a more active course in pressing the Philippine claim to Sabah it is almost inevitable that the established American position of impartiality will be interpreted as opposition to the Philippines (if we are not with them we're against them)./3/ The negative aspects of Philippine nationalism have traditionally focused on the U.S., and the Philippine claim could easily become more anti-American than anti-Anglo Malaysian. Philippine youth does not have the built-in restraint of memories of wartime cooperation with the U.S. Once Congress has reconvened we can expect its more vocal members to join the effort to get political benefit from attacks on the U.S. If this should be the course of events, we will be in for a dicey time. The extent of our exposure in this country produces a multitude of targets, and life could be made most unpleasant without outright violation of the letter of any of the network of agreements linking our two countries.

/3/Rusk and Foreign Secretary Ramos met at the United Nations on October 8 and discussed the Sabah dispute. Ramos reiterated more than once that the Philippines had no intention of going to war over Sabah. Rusk stressed that the dispute should not be settled by force and observed that there is a distinction between the United States acting on the basis of the status quo and taking sides in a territorial dispute. Rusk told Ramos: "Don't draw us into this; we have a basketful already." (Telegram 252294 to Manila, October 9; ibid., POL 7 PHIL)

4. Our military relations are particularly sensitive. We have outstanding commitments to discuss a number of provisions of the bases agreement and of course general commitments in Bohlen-Serrano to discuss "any question of particular interest" to either government. A formal demand by the GOP for renegotiation, followed by a tough approach and protracted talks, could have a serious adverse effect on military planning for the whole of the Western Pacific and Southeast Asia. The pending Smith case could be used as the basis for a request to renegotiate the bases agreement or could be combined with other general harassment of U.S. interests. The GOP may also seek formal renegotiation of the defense treaty in an effort to extract a more categorical commitment to immediate defense of the Philippines should it come under attack. There is also a broad range of other harassments which might include any combination of the following:

A. Stimulate labor troubles on the bases.

B. Over-bureaucratize customs procedures to point of stoppages--insist on customs control at Subic and Clark.

C. Take away our military radio frequencies (or harassment short of complete denial).

D. Institute clearance procedure of various degrees of cumbersomeness for all, or various categories, of U.S. and military flights (in country-out of country).

E. Deliberate slowness on visas for contractor employees and technical representatives.

F. Harass our military personnel with criminal actions.

G. Insist on taxation of MAC charter flights.

H. Insist on having Philippine customs, tax, immigration people on base.

I. Tax sealand shipments-vehicle registration, income tax, etc.

J. Licensing of on base contractors.

5. Philippine economic nationalism and individual greed, already making life difficult for American business, is certain to intensify as the GOP uses this technique of getting at the U.S. by vicarious punishment of American business. Following is a recap of existing or possible additional moves in this field.

A. Delay action on applications of American businessmen for treaty-trader-investor visas.

B. Postpone Senate consideration of ratification of U.S.-GOP double taxation agreement (already ratified by U.S. Senate).

C. Institute further court actions against U.S. business under Retail Trade Act.

D. Push through Oil Commission bill in next special session of Congress to detriment of U.S. oil companies.

E. Approval by President of anti-discrimination bill (equal pay for equal work).

F. Customs harassment on clearance of goods (including remnants) from U.S.

6. In the political field, the GOP apparently still feels that it can hurt us by opening diplomatic and trade ties with the Communist world. Plans are going ahead for a govt-sponsored company for trading with Communist bloc. The presence of a Soviet ambassador in Kuala Lumpur could now take on heightened significance, and as some Congressmen have suggested, there have been feints at seeking to obtain military equipment from the Communist world.

7. PHILCAG is an obvious target, and Marcos has the relatively graceful out of pleading insufficient funds to maintain it in Viet-Nam. He may, however, decide to go slow in a Philippine withdrawal since it would cancel his claim to a place at the peace table and, perhaps even more important, a chance to share in the post-war division of American military equipment. Rotation of PHILCAG to maintain the existing 1,500 strength level is now in progress and if the lift remains on schedule rotation will be completed on Oct 15. Several options short of complete withdrawal are open to Marcos including further across the board scaling down or selected withdrawal of engineer troops.

8. U.S. interests in the broader context of regional cooperation are also bound to suffer. The ASEAN Commerce and Industry Council met on schedule in Manila with a brave show of regional harmony, but the relentless logic of a consistent stand for and against the claim will tend to force the Filipinos and Malaysians into head-on collision in every common regional body, with a consequent disruptive effect on the whole framework of regional cooperation.

9. The foregoing bleak picture of a possible course of Philippine-U.S. relations is based on a pessimistic projection of events. Marcos in the coming days will be weighing carefully the advantages and disadvantages of the options open to him. In the third message in this series we will discuss courses of action which might help to shape his decisions./4/

/4/In telegram 15956 from Manila, October 4, the Embassy suggested the following ways to influence Marcos to take a serious look at the Sabah issue and the future of U.S.-Philippine relations: persuade him that the United States was looking for bases elsewhere in Asia, send personal messages from key Congressmen like Mansfield or Zablocki, arrange for hints from New York bankers that the United States was concerned, and suggest that the United States could reduce the Philippines sugar quota. (Ibid., POL 31-1 MALAYSIA-PHIL)



371. Telegram From the Embassy in the Philippines to the Department of State/1/

Manila, October 14, 1968, 1050Z.

/1/Source: National Archives and Records Administration, RG 59, Central Files 1967-69, POL 15-1 PHIL. Secret; Exdis.

16312. Subject: Williams talk with President Marcos.

1. Today I had the most basic and best talk yet with President Marcos. He had asked me to come over Monday when I telephoned him Saturday/2/ with Department's answer to his inquiry on Admiral Bringle's visit to Malaysia. The meeting was preceded by a preliminary meeting with Undersecretary of Defense Melchor and Chief of JUSMAG Gomes present. This was a discussion on GOP purchase of ammunition from Taipei. It will be reported separately./3/ As that part of the meeting drew to a close, I told the President I would like to bring something else up and he immediately suggested a private conference. The way he did it suggested to me that he had had this private conference in mind from the beginning. Melchor and Gomes withdrew and the President and I retired to the sitting space through the pillars behind his desk. There is a sofa between two rattling air-conditioners and two large easy chairs. Assistant Secretary Bundy will remember this as the place where we met with the President. The conversation was isolated and secure.

/2/October 12.

/3/Not further identified.

2. Anti-American demonstrations. The President began the conversation by saying he understood that we were concerned with the official support of the recent demonstrations. He said that it was true that he had close touch with elements in these demonstrations, particularly students and labor. He said and later repeated that while the situation now was under control, at one point it was in danger of playing into and falling into the hands of the Communists. As a consequence, he had maintained touch with radical leaders and had infiltrated his people so as to maintain control. He said, "You can tell your government that it can rely on the fact that I am in charge and that there will be no anti-American demonstrations that will get out of control." He said that there were some student organizations that were not strong enough and independent enough to prevent the Communists and other radicals from leading them. He then said that there were a number of radical leaders that he had enveloped in order to prevent their working against him. He said that Secretary of Labor Ople was one of these. He said he was a brilliant man and if he were left loose by himself, he could organize against the government. He mentioned two or three other names that I couldn't hear clearly. One of these was Adrian Christobel, a young speech writer and associate of Ople.

3. At approximately this moment I moved in with the point which I had originally intended to make with the President, namely that we felt that the United States was being harassed in the Department of Finance in matters such as Manila port customs. Specifically, after 18 years we were being required to fill out long form declarations of tax exemption which unduly tied up operations, required storage and opened possibilities of pilferage, etc. As my purpose was to raise U.S. concern about harassment of various kinds rather than seeking to work out any particular point, I did not further develop the matter.

4. Sabah. The talk in connection with the demonstrations turned naturally toward Sabah. The President said, "You know the Philippine people are really concerned about Sabah. I didn't realize myself how concerned they were. This is an important, serious issue with them." The President said again, as he had on previous occasions, that the Moslems were causing him a great deal of trouble on this issue. He said that Mindanao Moslems could be a problem because they could go to Sabah at any time and could cause trouble there. He said again as he said when Assistant Secretary Bundy spoke with him,/4/ that he would do everything to try to stop them from doing this, including his using force. He brought this latter matter up in connection with his last point, namely that the United States could help settle the Sabah issue.

/4/See Document 369.

5. Clark guns to Huks. The President next came up with three specific subjects. The first was his observation that guns and ammunition were getting out of Clark Field to the Huks. He admitted perhaps some had been stolen. He incidentally remarked that he had figures to indicate that there was enough alcohol coming into Clark to provide two gallons per day to each man. He said they were worried that there were a lot of luxury cars at Clark and that these and other luxury items could turn up in the black market. I told the President I would get in touch with Clark Field and have a specific survey made immediately of the possibilities of guns and ammunition getting to the Huks and that as soon as I had a complete answer I would ask the President for a meeting and would bring the 13th Air Force Commander to sit in with him to go over the whole thing. He indicated that he would be pleased to do so. On the matter of alcohol and luxury items, I said that the use of long forms or short forms in clearing shipping through Manila would do nothing to help solve that problem. I said, however, that we would be pleased to sit down with anyone to examine the problem and then to determine what specifically could be done to control it. In speaking about the possibility of arms getting to the Huks. He said, "Can't you do something about security at Clark." I said that starting with Smith incident, we had begun a complete review of all base security and would at the proper time welcome the opportunity to sit down with the Philippine authorities to see whether there were additional ways and means either unilaterally or bilaterally, to control this problem which concerned us very much.

6. Lansdale working politically against President Marcos. He opened this point with a question, "Where is Lansdale anyway? Is he working for the U.S. Government?" Of course I told the President that Lansdale was not working for the government but was in Honolulu at the East-West Center. I speculated that he was in a position where both Filipinos and Americans travelling from Manila to U.S. could be in contact with him and come back with stories, true or fabricated about their meetings with him. The President then said that he understood that Lansdale and 20 or 30 people were disappointed in him as President because he hadn't adequately repaid them for the help they had given him in his Presidential election. He then said, "I understand that Lansdale is trying to develop a candidate to beat me in the coming election." I told him that the U.S. Government had nothing whatsoever to do with Lansdale nor with anything he might be doing in developing a political opponent for Marcos. I told him that the U.S. is staying strictly out of any internal political matters. At the same time if we, as observers only had to lay odds on the outcome "in the language of the Philippine press you would be our bet. First of all you are the most likely winner and secondly you are by and large trying to do the things we would like to see done. Of course we are not backing anyone and we are not going to." The President terminated this part of our conversation by saying that he would very much appreciate it if we could get to Lansdale and tell him in some way to lay off. I said that we hadn't any way to do that inasmuch as he was not employed by us in any way but I would pass the message on to see whether Washington had any ideas on the subject.

7. Washington dislike of Philippines. President Marcos opened new subject by saying, "I don't think the State Department really likes the Philippines." He said his Ambassador in Washington had sent a report that in some recent public statements about foreign aid the Philippines wasn't mentioned once. I told him that I was frankly worried about the same thing. I said, "A moment ago, Mr. President, you said that you could ultimately control Ople because you fought together in Bataan. In this country and in mine there is a new generation who doesn't remember Bataan and they look at these things in a different light." I said that introspection in our country was prevalent. Our aid bill is the smallest in history. People in the U.S. are fed up with other countries and are looking inward. I said that this meant that people like the President and myself who wanted to see good relations between countries must be particularly careful to keep our lines straight. I said that any of the little irritants that come up are viewed in a different light from the earlier days of our close relationship. I said that some of the things that had happened recently in the Philippines were not making a good impression at home and that he knew what the McCloskey statement had blown up into in the Philippines./5/ I said that I thought my government would feel good about our conversation because I could tell them what he was really thinking about and that I hoped we could periodically have discussions to review the problems between us. He agreed that this was a good idea.

/5/See footnote 3, Document 373.

8. Philippines/Malaysia summit. President Marcos then went on to say, "I want to ask your government's help in getting a successful meeting between Malaysia and myself. I would like to see a picture taken of the Tunku and me sitting down at such a meeting." I said first of all I would like to understand whether President Marcos would be satisfied with a conference only involving a picture of himself taken with the Tunku or whether he was going to open a discussion in search of a Sabah solution. "I would like to get together and talk about lessening the tension between our countries," he said. I said, "We have taken the position constantly that we would like to see your two countries get together. We would certainly favor such a meeting. We have always wanted to see your neighbors help you get together, since we want to keep our profile very low. I don't know what we ourselves can do to bring about a meeting between you two." He then said, "If I may make a suggestion, I would like to suggest that your country could get together with the British to move Malaysia in the direction of such a conference." He said that he had talked with the British Ambassador recently about this matter. I said that I would convey the President's feelings to my government and I added that I felt sure my government would be very happy to know of the President's interest in trying to get the Sabah matter calmed down.

9. Conclusions. While I want to think over the implications of this conference before making a final report, after a preliminary discussion with top staff members, I think I can safely conclude that this was an important and useful conversation. Among the implications would be these: (A) our ties to the President through him, Rafferty to Mrs. Marcos and directly to the President are working well and providing a method of communication which, among other things, permits testing of the waters before Ambassadorial conversations; (B) it seems clear that the objective of having the President come to us, as raised in our previous summary telegrams, was partly achieved, although we left our door open through the Rafferty route. President Marcos is evidently concerned about what the U.S. thinks about his involvement in the recent anti-U.S. demonstrations and was concerned about the indications of Washington coolness towards the Philippines as conveyed to them through Ambassador Lopez. We continue to believe, however, that further signals to Marcos of the indirect sort suggested in our trilogy of cables would be helpful and would appreciate Department's views; (C) he definitely showed a raw nerve in his concern that the U.S. Government might be supporting Lansdale in developing his alleged campaign against Marcos' re-election. We have had previous indications from weeks back that Marcos was concerned that the U.S. Government was conspiring against him; (D) the Malaysia ploy either indicates that he is trying to please us by doing something which will show an attitude which we would approve, or he is genuinely interested in our assistance with the British, as he had been before his Sabah statement, or both; (E) we have not yet satisfied ourselves as to just what the Clark Field guns to the Huks point really means. It may be only that he is opening a possible bridge to further discussions. This matter is an old chestnut that the President has been fully informed about and we will of course bring him up to date; (F) all in all, the President's demeanor, the tone of the conversation and the several openings for further intimate discussions, inclines me to the view that this conversation has the potential for closer and hopefully better relations with the President.



372. Action Memorandum From the Deputy Assistant Secretary of State for East Asian and Pacific Affairs (Godley) to the Assistant Secretary of State for East Asian and Pacific Affairs (Bundy)/1/

Washington, November 15, 1968.

/1/Source: National Archives and Records Administration, RG 59, Central Files 1967-69, POL 33-4 PHIL-US. Confidential. Drafted by Price and cleared by Peter L. Wallin of L/SPA.

Philippine Archipelago Theory and the Right of Innocent Passage

1. The Philippine Government recently amended its legislation concerning territorial seas and internal waters, thereby reasserting its claim to an area of the high seas which at one point extends over 300 miles from the nearest Philippine land area of any consequence. This is a repetition of a previous claim made by the Philippine Government which we and other nations have never recognized. In 1961 we officially notified the Philippine Government of our non-recognition of this claim, and we consider it advisable to repeat our position at this time.

2. If this had been the only issue raised by the Philippine Government, it could have been handled in a low key and with little or no controversy with the Philippine Government. However, the Philippine Government has also for the first time attempted to deny the right of innocent passage to warships by requiring prior permission for passage of warships through Philippine claimed waters. This Philippine position was expressed in an Aide-Mémoire delivered to the British Government (Tab A),/2/ an Aide-Mémoire delivered to the Australian Government (Tab B),/3/ and a news release by the press office of Malacanang (Tab C)./4/ By the terms of these documents, the Philippine position would apply to all armed foreign public vessels. We do not feel we can leave this position unchallenged. It is contrary to the United States Government's view that a requirement of previous authorization for passage of warships is inconsistent with the right of innocent passage for warships guaranteed by the Convention on the Territorial Sea and customary international law. Philippine enforcement of their announced policy would create a precedent that invites application of this principle to other areas such as the Straits of Gibraltar, thereby endangering passage that is crucial to the strategic interests of the United States, its allies, and the free world. DOD (particularly the Navy), and the Office of the Legal Adviser in the Department feel very strongly, and we in EA concur, that we must not allow this precedent to take hold.

/2/As contained in telegram 13143 from London, October 2; attached but not printed.

/3/As contained in a telegram from the Australian Embassy in the Philippines to Canberra, October 10; attached but not printed.

/4/Dated September 23. (National Archives and Records Administration, RG 59, Central Files 1967-69, POL 33-4 PHIL-US)

3. Both the British and the Australians are faced with the necessity of replying to notes and Aides-Mémoire but their Embassies here expressed a desire to consult with us in advance. The British have prepared draft replies, a note protesting the legislation (Tab D) and an Aide-Mémoire in response to the Philippine Aide-Mémoire on innocent passage (Tab E)./5/

/5/Neither attached.

4. Given the current anger of the Filipinos against the British growing out of the Sabah dispute and British actions in support of Malaysia, it is our conviction that a delivery of the British note and Aide-Mémoire without adequate advance preparation would cause further controversy and lead the Filipinos to digging in even stronger in their untenable position. Given our overall strategic interest, we would not be able to avoid involvement. For this reason, we believe the best procedure for all concerned and the one offering the best chance of avoidance of an unpleasant clash between the Filipinos and their best friends is for our Embassy in Manila (preferably Ambassador Williams with President Marcos) to have a frank talk with Filipino officials. Attached as Tab F is a draft which has been cleared with DOD and the Office of the Legal Adviser, and which has been discussed with officers of the British, Australian and New Zealand Embassies here, designed to accomplish this purpose.


That you approve the attached instructions to Embassy Manila./6/

/6/Bundy approved sending the instructions attached as Tab F; they were transmitted in telegram 276316 to Manila, November 22. (National Archives and Records Administration, RG 59, Central Files 1967-69, POL 33-4 PHIL)


373. Telegram From the Embassy in the Philippines to the Department of State/1/

Manila, December 13, 1968, 1112Z.

/1/Source: National Archives and Records Administration, RG 59, Central Files 1967-69, POL PHIL-US. Confidential.

18584. Ref Manila 15756, 15828, 15956./2/ US-Philippine relations: a current reading and a projection forward.

/2/See Document 370 and footnotes 2 and 4 thereto.

1. In analyzing the Philippine situation, complete objectivity is difficult at this moment because US-Philippine relations have once again gone sour. Our major objectives are substantially unimpaired and our relations on the surface remain cordial, but consistent with the four-year cycle that makes the third year in office of each Philippine President one of reciprocal disappointments, there is now annoyance and frustration on both sides.

2. The Philippines has its traditional ambivalent complaints of too much American economic presence but too little American investment; too much American military presence but too few unqualified, automatic defense guarantees; too much American paternalism but not enough tangible demonstrations of paternal affection. The McCloskey statement on Sabah/3/ and the AP report based on it that the US had abandoned its position of impartiality on the Philippine claim opened Pandora's box. Some Filipinos, reportedly even the President, felt the US had deliberately stabbed the Philippines in the back. Others more sympathetic felt the McCloskey statement was unfortunate and ill-advised. Sabah aside, however, most of the Philippine gripes are chronic, not acute./4/

/3/On September 19 Department of State Spokesman McCloskey stated that the United States recognized Malaysia in 1963, and the press concluded that he had stated that the United States recognized Malaysia's claim to Sabah. On the next day, September 20, McCloskey stated that recognition of Malaysia in 1963 was in no way a departure from U.S. neutrality toward the competing Philippines and Malaysian claims to Sabah. The United States recognized countries with territorial disputes without taking sides, as was the case when the United States recognized India and Pakistan without reference to Kashmir. (Telegram 15394 from Manila, September 21; National Archives and Records Administration, RG 59, Central Files 1967-69, POL 32-1 MALAYSIA-PHIL)

/4/ In telegram 17833 from Manila, November 22, the Embassy reported that Mrs. Imelda Marcos had complained to Embassy officer Rafferty about the deterioration of U.S.-Philippines relations. She specifically mentioned rumors that Edward Lansdale and the United States were "looking for a candidate to support against Marcos." Mrs. Marcos stated that steps had to be taken to improve U.S.-Philippines relations. (Ibid., POL PHIL-US)

3. Most of the active sourness is concentrated on the American side and is created by irritation, impatience, and frustration. Marcos has not done all we wanted on PHILCAG. Marcos' domestic leadership has not been up to expectations. The Filipinos often do not live up to their part of aid or trade arrangements. The Philippines has lagged behind the rest of Asia in economic development. Philippine policies on Laurel-Langley vested rights and land ownership issues promise to injure both the Philippines itself and US investors. Crime, graft, and corruption are on the rise. For the first time there was palace complicity in anti-US demonstrations. Guerrero's tactics in Bangkok and the way Marcos has pursued the Philippine claim to Sabah have cast a pall over the bright new day of regionalism we were [garble--planning?] for Southeast Asia.

4. We also have a rash of other nagging irritations and complaints, related principally to the movement of military cargo to our bases in the Philippines. In the words of a prominent US official, we are fed to the teeth with the Philippines.

5. The Filipinos, on their side, have been conducting business with the US in a normal manner following the traditional pattern of manipulation of an indulgent, generous, permissive foster parent. To use a favorite Philippine cliche, they have taken us for granted. They have utilized, but far from the fullest, the two major levers which we placed in their hands; our need for the military bases and our desire to have Philippine troops represented in Viet-Nam. Until very recently they were apparently completely unaware of the resentment building up in the US. Showing an uncharacteristic lack of sensitivity, they failed to recognize that historical protectors and patrons of the Philippines had all but vanished from the American scene. The Philippines is now being judged on an objective standard--perhaps even somewhat more strictly since as a former US charge we expected them to be leading, not falling behind, their Asian neighbors.

6. Following Marcos' triumphal US tour and President Johnson's many favorable comments on the Marcos administration, the Philippine Government was so sure of itself and the effectiveness of backdoor diplomacy that saw no need for first-rate diplomatic representation in Washington. There has been no full time Ambassador since Ledesma departed in 1965. A diplomatic mission of monumental mediocrity provided no really effective eyes and ears for the Philippine Govt in Washington. The American Ambassador to the Philippines, in Marcos' own words, was also the Philippine Ambassador to the US. Only within the past few weeks has the situation gradually come home to the Philippines as junketeering Philippine Congressmen, govt officials and businessmen returned from the US in a state of surprise and alarm over the frosty displeasure they found.

7. These reports served to accentuate a growing mood of doubt and uncertainty in the Philippine mind about the future of their relations with the US brought on by other events. The bombing halt and the possibility that 1969 might bring an end to the war in Viet-Nam started the Filipinos thinking that there might be a change in US attitude toward its military presence in Asia following such a settlement. The election of Richard Nixon created a whole new range of uncertainties about the policies of the new administration, and the Filipinos began to circle warily around a number of indications that Southeast Asia might decline in order of priority and the Philippines might lose the leverage which they have come to believe was a permanent aspect of their relations with the US.

8. Within the Philippines itself, the country is entering a period of transition which will in any event have an effect on Philippine-US relations. The President elected in 1969 will probably be the last Filipino chief executive who remembers the Commonwealth. In 1973 the post-war generation will be a major element of the electorate. The US will have lost most of its automatic "constituency," except perhaps in the provinces, and the President elected in that year, and all those aspiring to the Presidency will have to accommodate to the more independent, internally oriented new Filipino. Marcos, as a transition President, is already feeling the conflicting pulls of the familiar security and dependence of the old US-Philippine ties and the exciting perils and promise of full independence.

9. The road ahead in our relations with the Philippines is in fact obscured by at least three major uncertainties. We do not yet know the full programs and policies of the new administration that will take effect next January. We cannot forsee in any detail the circumstances which will surround the settlement of the conflict in Viet-Nam, nor the results of the reassessment of our entire forward base structure which seems almost certain to follow such a settlement. Finally, we cannot forsee the nature of the extent of the post-1974 relations between the two countries on trade and investment matters.

10. Our relations with the Philippines in the economic field are inevitably moving toward a diminution of the intimacy that has existed heretofore. This is in part due to the operation of secular historical forces as time passes since the Philippines was a member of the American body politic. However, the pace is forced by the pressure of Philippine nationalism. In investment matters nationalism is leading them to define in narrower terms the role that foreign investment, including US investment, is to play in Philippine development. In trade matters, it is moving them toward stronger protectionism through both tariff and nontariff devices. Like all developing countries, the Philippines will continue to require substantial help from the US and the rest of the developed world, but it will increasingly attempt to obtain this help in forms compatible with its nationalism.


11. What can we see as a likely future course of US-Philippine relations beyond the current period of transition and uncertainty? Attempting to filter out the highly subjective and emotionally charged range of irritants stemming from a relationship which is perhaps too close, certain basic and important US interests in the Philippines can be identified.

12. Our first interest is that we have, in the broadest sense, a base of power in the Philippines. We speak to Asia and even to Eastern Europe through VOA transmitters in this country, and communicate by the written word through publications printed in the Regional Service Center. US military bases in the Philippines include perhaps our single most important base in the Far East and provide the fulcrum through which our military power is applied in Asia. Twenty-four govt agencies maintain regional offices here. The US Govt and American private business recruit labor here for work all over Southeast Asia and the Western Pacific. This broad range of operational cooperation, functioning now for 22 years, we have come to accept as the natural course of things because it has worked so well. Nowhere else in Asia is US power--again using this word in its broadest sense--exercised with such freedom and with such a degree of host country indulgence.

13. Although our military bases in the Philippines are indeed the cause of frequent misunderstandings and friction, we must not allow that to becloud the fact that we are more than fortunate to have large-scale, effective and efficient bases for US naval and air power in a strategically vital position in Southeast Asia. Furthermore, there is reason for optimism concerning our ability to retain this situation for a good many years to come, probably considerably longer than will be possible elsewhere in the Far East. As long as US policy dictates a requirement to maintain a significant political and military influence in the Far East, or at least in Southeast Asia, the retention of these bases must be a primary, if not overriding, objective of our US-Philippine relations.

14. Secondly, we have a selfish economic interest in Philippine development. The Philippines could provide an excellent field for increased US investment, if its shortsighted policies were to change. US exports to the Philippines (some $300 million) also continue to grow, even though our percentage of the market has markedly declined. A prosperous expanding Philippine economy could stimulate economic development elsewhere in Southeast Asia and stimulate further opportunities for US investment and trade.

15. Thirdly, we have a special interest in the almost 35 million people of the Philippines. They may no longer be our "little brown brothers" but in the eyes of Asia, and much of the rest of the world, they are marked to a greater or lesser extent "made in America." Their success or failure will be to some degree a measure of the kind of people we are, how we respect our responsibilities, and how valid are our political, economic, and cultural beliefs.

16. This arises not only from over 50 years of domination of the Philippines, but from the fact that the Philippines have professed the same beliefs that we do and have in fact or appearance adopted us and our ways.

17. With no other Asian nation do we share to the same degree political, social, religious, and cultural values. It is not only that they have taken over and adapted for their own use our Constitution and political system as well as our private enterprise economy, but they have assimilated many but obviously not all of our characteristics. What other Asian society could produce a Corky Trinidad, whose excellent political cartoons run simultaneously in Philippine and US papers? In what other Asian society is there such freedom, if not license, in the press? Where anywhere in the world could you find so much American sports news in the press?

18. While there are differences of significance, of course, there are two essential facts of importance. Filipinos have become in a marked degree what they are because of us. On the one hand, this is a responsibility and an opportunity for us, if we believe, as we do, that the spread of independence and democracy promotes our own security and world peace. On the other hand, our credibility, our prestige, and our influence are tied with Philippine success or failure.

19. Fourthly, the US has been interested in the Philippines assuming a role of leadership in the development of regionalism in Southeast Asia. We were delighted when President Marcos and FonSec Ramos assumed such a posture, and were disturbed and dismayed when the Sabah affair disrupted these good beginnings.

20. Fifthly, we have the same normal interests in good relations with the Philippines that we have with the other nations of the world. We appreciate an opportunity to influence them in bilateral and world affairs in a direction that we deem helpful overall.

Problems inherent in US interests

21. Continuing use of military bases and the protection of private national investments carry with them strong colonial overtones. These continuing manifestations of American military and economic power tend to produce strong nationalist emotions even among those intellectually aware of the substantial contribution bases and American business make to Philippine well-being.

22. There is also a growing tendency to see the bases as serving US national interests more than Philippine national interests. A conventional military threat from Communist China now seems less imminent and there are those that argue that the bases constitute a target for the growing Chinese nuclear capability. However, even of those who resent the bases, most recognize their necessity for the immediate future for Philippine security.

23. Our efforts to protect American business interests are challenged by elements of the elite and doctrinaire govt officials motivated by economic nationalism and/or cupidity. At a time when the developing world is competing vigorously for capital assistance from a developed world, we find ourselves in the paradoxical position of using US bargaining assets to persuade the Filipinos to preserve what in their own interest they should be seeking.

24. Objectives in the field of nation building have the inherent limitation that this building process in the final analysis must be accomplished by the Filipinos themselves. We can stimulate, urge and cajole, but we cannot force on them economic and political salvation. Our exhortations to get on with the job of nation building also create a pitfall. If the Filipinos come to believe that we are more anxious to see them achieve these goals than they are themselves, "nation building" becomes merely a slogan by which they extract assets from us. We also can find ourselves in the position of paying the Filipinos for the privilege of helping them, and our inputs tend to become not supplements but substitutes for the allocation of Philippine resources.

Future policy

1. In our projections of US policy we are making several basic assumptions:

A. The US will require some or all its military bases for a ten to twenty year period.

B. The Philippines will continue to be an important place for US investment and trade.

C. US will recognize that Philippine progress is an important element in its prestige and operations in the Far East.

D. US will be interested in Philippine cooperation in Southeast Asian regionalism.

E. US will be interested in continued good relations with the Republic of the Philippines.


25. To maintain our military base structure for ten to twenty years we should do the following:

A. We must impress the Filipinos that US use of bases in the Philippines are in the interests of both the Philippines and the US. In addition to the normal public relations programs, in-depth programs should be developed such as perhaps joint war games that will bring home to the Philippine military the importance of US bases and forces to their security.

B. We should continue military aid, particularly technical assistance, training in the US, etc., so as to preserve vital person-to-person relationships and common traditions and common equipment.

C. Special attention should be given to continued progressive base labor relations: strikes or slowdowns of local base workers could cripple the bases.

D. We should interpret criminal jurisdiction provisions of our base agreements sympathetically with every effort made to avoid incidents, including greatest possible use of Philippine buffers.

E. We should give sympathetic consideration to increased joint responsibility and/or visible appearance thereof, consonant with effective operational control.

F. In the field of mutual defense, the clearest possible definition, as authoritative as possible, of our immediate reaction response compatible with overall US policy.

G. We should negotiate all moves. Let Filipinos win where we should yield rather than US gratuitously give. We should yield progressively not precipitously or too late.


26. In working out with the Philippines a new basis for the economic arrangements to succeed Laurel-Langley, our policy should be one of gradual rather than sudden and wrenching change. We should recognize the painfulness for the Filipino, both in psychological and economic terms of the phasing out of the "special relationship," even though this change is what they want. In the negotiations we should maintain a flexible position and open mind on possible measures required to ease the pain of transition in such fields as tariffs (even the continuation of preferences), commodities, investment, and perhaps even credit. This posture would be founded on a recognition that, within broad limits, a satisfactory military-political relationship will be impossible to maintain in the absence of an economic one which the Philippines regard as reasonably satisfactory.

27. Our economic policy should contain the following major elements:

A. We should make a special report to bring home to the Filipinos the advantages of good business climate and the manifold contributions of foreign investment.

B. As a complementary effort we should resist the anti-foreign thrust of Philippine policy on investment matters. We should do so in part because we have a legitimate duty to ensure that American interests receive equitable treatment, and in part because foreign investment is keenly needed for Philippine development.

C. We should recognize that despite its well-known weaknesses and inequities, the free enterprise economy of the Philippines is a vital dynamic force. It is a good calculated risk.

Philippine nation building

28. Our assistance to the Philippines in the process of nation building should include the following elements:

A. We should continue to provide feasible economic assistance particularly in the technical area for nation building and as a means of maintaining close man-to-man relationships and common interests between the President and the Ambassador and between other US and Philippine officials.

B. We should encourage miracle rice expansion through proper storage, milling, marketing, and export programs. This should be followed by diversification to field and feed crops, and pork, poultry, and beef programs to maintain labor intensive, profit making agri-industry.

C. We should encourage road and infrastructure development programs.

D. We should provide assistance to law and order programs consistent with Philippine inputs.

E. We should continue to encourage the growth of legitimate labor unionism and the economic advancement of the working people.

F. We should give selective encouragement to manpower training to meet the needs of existing and new industries. At the same time we should recognize that with the end of the Viet-Nam conflict there may be a sudden return of many skilled or semi-skilled workers who could disrupt labor market and cause unrest.

G. We should continue to provide support to Philippine programs of population control and family planning.

H. Peace Corps and other agency programs to improve the ability of Filipino teachers to teach their students to think, rather than memorize, as well as Peace Corps programs in the field of agriculture, economic planning, public health, and community development, should continue.


29. Regionalism, if it is to grow beyond acronyms, must meet what the nations of Southeast Asia see themselves as a pressing need. Our capacity to persuade the Filipinos to recognize this need is limited, but we can by current programs of quiet backing of Asian initiatives, as well as tactful indirect support of regional cooperation, speed up this process.

30. The Sabah dispute is currently a significant obstacle to regionalism. Here again, our capacity for successful direct intervention is limited, but we can continue to give behind-the-scenes support to Asian efforts to find a solution.

Good relations

31. We should continue our efforts to put our relations with the Philippines on a basis which recognizes sovereign equality and mutual respect.

32. We should broaden our contacts with the non-establishment side of Philippine society--the youth, labor leaders, intellectuals, younger military leaders, that are working for change and will play an increasingly important role in shaping the destiny of this country.


33. The Philippines and the United States have a broad community of interests. As a new US administration takes over we must recognize that on the Philippine side this parallelism is imperfectly perceived. As the Philippines develops, however, there will be a growing recognition that our relations are not based merely on sentimental friendship and a patron-client dependency, but rather on a broader and more secure base of compatible, complementary, national interests and objectives. The strength of these ties make us optimistic for the future.



374. Telegram From the Embassy in the Philippines to the Department of State/1/

Manila, January 13, 1969, 1150Z.

/1/Source: National Archives and Records Administration, RG 59, Central Files 1967-69, POL 33-4 PHIL. Secret. Repeated to Canberra, Kuala Lumpur, London, Wellington, CINCPAC, and COMNAVPHIL.

396. Ref: (A) State 290585,/2/ (B) State 276316,/3/ (C) Manila 18293,/4/ (D) Manila 17663,/5/ (E) Manila 18996 NOTAL./6/ Subject: Territorial seas and innocent passage.

/2/In telegram 290585 to Manila, December 20, the Department of State clarified its guidelines for a discussion with Marcos about the Philippines' position on the archipelago theory and the right of innocent passage. (Ibid.)

/3/See footnote 6, Document 372.

/4/In telegram 18293 from Manila, December 12, the Embassy responded to telegram 276316 with the suggestion that the United States should avoid controversy and confrontation with the Philippines over the issue of innocent passage and try to raise its concerns in a multilateral context. (National Archives and Records Administration, RG 59, Central Files 1967-69, POL 33-4 PHIL)

/5/In telegram 17663 from Manila, November 19, Williams reported a discussion he had that day with the Australian Ambassador on the Philippines' position on innocent passage. (Ibid.)

/6/In telegram 18996 from Manila, December 30, the Embassy suggested that to avoid giving the impression that the United States supported Malaysia in the Sabah dispute and to prevent offending Marcos, another SEATO member, such as Britain, take the lead in protesting the Philippines' decision to deny innocent passage. (Ibid.)

1. Pursuant to references A and B, I took the above subject matter up with the President at a meeting arranged to brief him on the findings of a joint committee on weather reporting.

2. As luck would have it, after we had all shaken hands in front of his desk, he asked me to retire with him to the couch and chair arrangement in the back of the room behind the pillars where Assistant Secretary Bundy and he had their last conference. When he did not raise any matter of substance right away, I took the opportunity to raise the territorial seas and people appeared to withdraw and permit us the opportunity of relatively secure conversation.

3. I began by saying that there appeared to be a matter on which our two governments seemed to have a serious difference of principle in which our views were shared by a number of the Philippines' best friends. Under these circumstances, I said, I thought it best to have a frank and friendly discussion to see whether some means could be found to avoid public confrontation.

4. I then said that the problem had two related aspects: (A) the Philippines archipelago claim on territorial seas which we have never recognized and have so advised the Philippine Government officially, the last time in 1961; (B) the "right of innocent passage."

5. I then made reference to the Malacanang press release dated December 23 which quoted the aide-mémoire to the British to the effect that "armed foreign public vessels . . . cannot assert or exercise the so-called right of innocent passage through the Philippine territorial sea without the permission of the Philippine Government." I said, "As you know, it is the position of the United States Government that the right of innocent passage is firmly established under international law and that my government believes it is of the greatest importance that this right be maintained. We recognize that the Philippine Government is not a party to the convention on territorial seas but that it is our view that this convention still sets forth established principles of customary international law in this area."

6. Then I stated that the USG has always supported the right of innocent passage and that it is even more important today. I said that to accept the denial of the right of innocent passage could in our view create a precedent for similar action in other parts of the world, such as the Straits of Gibraltar. Furthermore, I said, "Were we to acquiesce in such claims, denying naval access to large sea areas of the world, it would seriously affect the strategic interest of the United States, its allies, and the free world, and we believe would be inconsistent with the overall strategic interests of the Philippines itself. It is for this reason that we feel we must in all friendship raise these issues with you at this time."

7. Next I recognized that because of our agreements there was no question of right of innocent passage between us but that the public statement made by the Philippine Government places us in a difficult position. Further, I said, "Both of us are aware that a number of our mutual friends--Britain, Australia, New Zealand--share our views on the importance of maintaining the right of innocent passage." Then I said "Is there any way to resolve the issue quietly--would the President consider retracting the press statement? Would he consider holding back on enforcement?"

8. The President followed my presentation closely and responded agreeably. He recognized that a serious problem was posed and intimated that it was not of his making. He said that this of course was something that the legislature had done.

9. He said he would like time to think it over but that probably two panels could be set up to review the matter quietly.

10. We ultimately broke off with the idea that he would consider the matter further.

11. From what he said, and his demeanor, I got the impression that he had no intention of pushing this matter to a confrontation but that as of the moment he had no particular solution in mind that would avoid the confrontation, although I think he would be agreeable to finding or accepting one.

12. The President made no response to my question as to whether he would consider retracting the press statement, and, as I have previously indicated, I don't think that this would be politically feasible for him to attempt. He also did not refer directly to the matter of enforcement, but as I have already indicated, I would not think that he would go out of his way to enforce or say he would enforce these provisions unless he were forced into doing so.


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