US doesn't expect change overnight in the Philippines. But Reagan emissary, civil unrest warn Marcos reform needed soon

Sen. Paul Laxalt's mission to the Philippines last week is not expected to quickly produce the changes needed to restore US confidence in the Marcos government. Nor is it likely to blunt the sharp edge of the Philippines' growing communist insurgency. But, according to State Department officials, the US has now sent the strongest message yet that concern over the precarious position of the Marcos regime is not confined to liberal congressmen and pin-striped diplomats.

``This is not [Secretary of State George] Shultz turning out some third-string bureaucrat,'' says one State Department official of the Laxalt mission. ``The things Laxalt said to Marcos have been said before -- but this time I think he heard them better.''

In his talks with President Marcos, Senator Laxalt (R) of Nevada stressed the need for three reforms: fair and open elections, an end to the ``crony capitalism'' that has left major Philippine industries dominated by friends of Marcos, and military reform to encourage greater professionalism within the Philippine armed forces.

Senator Laxalt also told Marcos that the US was strongly opposed to the reinstatement of Gen. Fabian Ver as chief of staff of the Philippine armed forces. General Ver, together with 25 other armed forces personnel, have been implicated in the 1983 assassination of Philippine opposition leader Benigno Aquino. Ver's acquittal was all but guaranteed after the Marcos-appointed Supreme Court dismissed important evidence in the case. A decision in the Ver trial is expected before the end of the year.

But, no matter how well Marcos may have ``heard'' Laxalt's message, many observers here -- including some US officials -- concede that prospects under Marcos for the kind of reform necessary to quell middle-class discontent and communist-led violence are minimal. These estimates were reinforced when Marcos reaffirmed his intention to reinstate General Ver. Marcos's intransigence hints at what has now become one of the United States' biggest foreign policy dilemmas.

``Laxalt has made clear that Marcos will have to make more than symbolic reforms,'' says Richard Kessler of the Carnegie Endowment for International Peace. ``But if Marcos goes very far, he'll be committing political suicide. If he carries out political reform, he'll allow the opposition a real chance to take power; if he permits military reform he'll destroy his base in the army; by making economic reforms, he'll be cutting himself and his friends off from banking and political power.''

Part of the growing US interest in President Marcos' political health stems from US military and strategic considerations. The Clark air and Subic naval bases, the largest outside the US, are key links in a critical chain of defense installations, stretching across the western Pacific. US officials say the consequences of losing the bases have grown dramatically since Soviet ships and planes began using former American bases in Vietnam.

``We can't lose Vietnam in the 1970s and the Philippines in the 1980s and remain a credible Pacific power,'' says a State Department source.

But officials say US interest runs deeper, touching on the long and close friendship the US has had with this Southeast Asian nation.

``The real question is not the bases,'' this State Department official continues. ``The question is seeing an old friend and ally go down the drain. If the insurgents continue to grow, we could have to look back some day on the loss of the Philippines. The question we'd have to ask then is, how could we have kept this from happening.''

One answer high on the administration's list is additional military aid. US officials say such aid is necessary to equip the Philippine armed forces to deal with the threat posed by the New People's Army (NPA), one of the fastest growing communist insurgencies in the world.

On Wednesday, during the most recent outbreak of violence, rebel forces killed Gregario Murillo, governor of Surigao del Sur province on Mindanao island. This means more than 70 officials have been killed this year by guerrillas of the NPA. The shooting comes in the wake of civil unrest and clashes between government troops and communist insurgents on the island of Panay.

These disturbances have prompted President Marcos to sign a law that bans demonstrators from major streets and bridges, and requires municipalities to establish ``freedom parks'' and issue permits to those wishing to gather for rallies. But the administration is eager to convey the message, carried by Senator Laxalt, that fundamental reforms will be required for Marcos to stave off the insurgency and weather the current crisis.

Administration officials fear that forcing reforms with cutbacks in military or economic aid could weaken Marcos, to the benefit of the insurgents. Instead, Reagan officials have opted for the kind of quiet but persistent diplomacy symbolized by the Laxalt mission.

But many in Congress say that without reforms, new military aid to the Philippines may be useless.

``Without respect for human rights, all the money in the world won't have the effect of stopping the growth of the NPA,'' says one congressional aide.

Last September, Congress authorized only $70 million in new military aid to the Philippines, $30 million less than the administration's original request. Congressional sources say funds could be trimmed further during the appropriations process, especially if General Ver is reinstated.

Congress has also cast a wary eye on administration plans to invest $1.3 billion to upgrade the Clark and Subic bases. Administration officials play down any risk to the bases. Still, the plan has been criticized in Congress because of the deteriorating Philippine political situation. The bases lie on the main island of Luzon, adjacent to communist strongholds.