The Philippines Digging for Treasure

By Susan Tifft

A week after Ferdinand Marcos touched down at Hickam Air Force Base in Hawaii, U.S. Customs officials were still examining his luggage. The deposed Philippine President and his 88-member entourage brought with them 22 boxes of freshly minted pesos and 278 crates of jewelry, artworks, gold and real estate deeds. That cache last week became the centerpiece in a tug-of-war between Marcos and the new government of Corazon Aquino, which claimed that the loot and other Marcos wealth abroad legally belonged to the Filipino people. The Reagan Administration found itself caught between its desire to help the fledgling Aquino government and its promise to provide Marcos with a dignified exile. "These are complicated questions," said State Department Spokesman Bernard Kalb of the treasure hunt. "We are sorting them out step by step."

Aquino's attempts to claim the Marcos millions topped a week in which the new President moved to consolidate her power. She freed prominent insurgents, including the founder of the outlawed Communist Party, took steps to replace local officials loyal to her predecessor and asked for the resignations of Marcos' judges. Aquino found that she could not please all of the people all of the time. The military opposed her decision to free the hard-core rebels, and leftists complained because she had not freed everyone earlier. Meanwhile, Marcos supporters accused her of acting arbitrarily in ousting local officials.

There was widespread support, however, for Aquino's efforts to reclaim the Marcos riches. Within days of the former President's arrival at Hickam, the Philippine Central Bank filed a motion in U.S. district court in Hawaii to obtain an accounting of the money Marcos took with him. By week's end the U.S. Customs Service, which retained custody of the bounty, reported that the 22 boxes contained approximately $1.4 million in pesos. An inventory of the remaining crates is expected this week.

The Administration seemed embarrassed at having provided U.S. cargo planes for Marcos' cash-and-carry exit. "Looking back, it was a stupid thing," said a Justice Department official. "But everything moved so fast." Indeed, in the confusion at Clark Air Base, north of Manila, where Marcos stopped before traveling to Guam and then to Hawaii, U.S. military personnel loaded the President's possessions after only a cursory inspection. Marcos claimed last week that he had originally intended to fly from Clark to his home province of Ilocos Norte. Only when the Aquino government refused to let him stay in the Philippines did he accept President Reagan's invitation to come to the U.S. The Aquino government last week acted to restrict Marcos' future travels. It revoked the passports of the former strongman and his entourage, making it difficult for them to leave the U.S. to avoid legal scrutiny.

The riches seized in Hawaii may be modest in comparison with the real estate, foreign bank accounts and other hidden wealth allegedly controlled by Marcos and his family. Jovito Salonga, 65, head of Aquino's Presidential Commission on Good Government, which has been charged with recouping the fortune, estimated Marcos' assets at between $5 billion and $10 billion. Even the lower figure greatly exceeds the Philippines' 1985 government budget of $3.1 billion. During his tenure as President, Marcos received an annual salary of $5,700.

According to Salonga, the Aquino government found "smoking gun" documents at Malacanang Palace, the presidential residence, that link Marcos with bank deposits in Brazil, Switzerland and the Bahamas, as well as with property in the U.S. Salonga said the papers prove that Marcos used intermediaries to buy properties in New York, including a shopping complex in Manhattan and a posh estate on Long Island. Total value: approximately $350 million.

The Aquino government last week obtained a temporary restraining order in the New York State Supreme Court barring the transfer or sale of the buildings until March 19. There were allegations that Marcos had claim to vast holdings in Tarrant County, Texas, and San Diego County, Calif. And late last week Filipino bankers, lawyers and government officials charged that Marcos had received the better part of an $80 million payment in 1976 from Westinghouse Electric in connection with a lucrative contract to build the first Philippine nuclear power plant.

As the evidence of misdeeds mounted, the Reagan Administration sought to extricate itself from the quest for Marcos' wealth. By week's end the U.S. was considering asking a federal court in Hawaii to decide what to do with the crates sitting at Hickam. The Administration stoutly maintained that the Marcos party had no legal immunity from court suits or congressional inquiries. "No laws will be bent," said a Justice Department official. "Nobody is above the law."

While the struggle over the missing millions was going on, President Aquino also had to deal with more routine government business. Last week she kept her campaign pledge by releasing all known political prisoners of the Marcos era. Among them were were Jose Maria Sison, 47, founder and former chairman of the outlawed Communist Party; Bernabe Buscayno, 42, the alleged founder of the New People's Army, the party's guerrilla arm; and two members of a rebel hit squad. The four reputed Communists were freed over the objections of Defense Minister Juan Ponce Enrile and Chief of Staff Fidel Ramos. Aquino's move may prove to be a shrewd stroke. Both Sison and Buscayno have been in jail for nearly a decade. In the interim they have been replaced by Communist Hard- Liner Rodolfo Salas. If Sison and Buscayno try to resume influential roles in the insurgency, they could cause a split in its ranks.

Aquino's strategy in dealing with the Communists is to court the 16,000 to 20,000 rebels with offers of a six-month cease-fire and amnesty if they disarm. At least one regional N.P.A. command scoffed at that, demanding the ouster of Ramos and Enrile before talk of a cease-fire could begin. But the government is apparently considering at least one intriguing sweetener: paying the rebels above-market prices for turning in their guns. Under the plan, a guerrilla might receive, say, $1,750 for an automatic rifle worth $1,500 on the open market. He would also be offered a place in an employment-training program. Those who finished the course would be guaranteed jobs on a government-owned farm, where they would be given a salary and a lease on a small plot of land. "We wouldn't just offer them a cease-fire," says an Aquino aide. "We would offer them a business deal." If last week's actions are any indication, that may not be sufficiently enticing. N.P.A. units, which had been relatively quiet during the presidential campaign, were back on the offensive. Fifteen policemen were killed in a rebel ambush in Albay province.

Aquino may find the rebels more tractable than politicians in Manila. Last week members of Marcos' New Society Movement were angry because the new Minister of Local Government, Aquilino Pimentel, indicated that Aquino might name many of her own people to provincial and municipal slots and postpone local elections expected in May. The new President ran into less opposition when she attempted to recast the Marcos-dominated judiciary. By week's end she had secured resignations from ten of the twelve members of the Supreme Court and from 37 of 38 judges on the appellate court.

One major piece of judicial business facing the President will be a new inquiry into the murder of her husband, Benigno Aquino Jr., who was killed as he stepped off a plane at Manila International Airport in 1983. Apparently emboldened by Marcos' departure, Manuel Herrera, a prosecutor in the ombudsman's office of the graft and corruption court, came forward last week with fresh details about the case. General Fabian Ver, Marcos' Chief of Staff, and 25 other defendants were charged with conspiracy in the assassination. Herrera recalled a meeting with Marcos before the trial began in which the former President asked prosecutors to limit their indictments and suggested how facts might be suppressed. Throughout the discussion, Herrera said, Marcos subtly badgered him to bring reduced charges against some of the defendants, which he later did. At the end of the meeting, Herrera maintained, "Marcos stood up, looked straight in my face and said, 'I am a grateful man. I know how to reciprocate.' " Some witnesses at the Ver trial have indicated that they might wish to change their testimony, and Aquino is expected to reopen the case.

Perhaps the most pressing issue facing Aquino is her country's economic troubles. This week an International Monetary Fund team arrives in Manila to determine whether the Philippines should receive the next scheduled installment of standby credits. In Washington, both the Reagan Administration and Congress have expressed eagerness to increase Philippine aid. "We want this experiment to be a success," said Republican Senator Richard Lugar, co- chairman of the U.S. observer team that monitored the Philippine presidential elections. "We're going to have to do more." The new Philippine President will clearly need that help.

With reporting by Edwin M. Reingold and James Willwerth/Manila