THE PHILIPPINES: Powder Keg of the Pacific

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Reported TIME Correspondent Ross H. Munro after a visit to Negros Occidental: "Nowhere does the gulf between Nutrition Center show business and reality seem wider than in the provincial hospital of Bacolod. The hospital's 'Nutriward' has a total capacity of only twelve children, all suffering from marasmus, a severe form of malnutrition. The young patients seem to have been transplanted from the famines in Bangladesh and the sub-Sahara earlier in the decade. Big eyes staring from skeletal heads, matchstick limbs, bloated bellies. A priest of the province gloomily estimated that 70% of his parishioners do not have enough to eat: "Two meals a day, just some rice and vegetables; fish is a luxury."

One hospital worker at Bacolod angrily told Munro that several patients had died for lack of medicine after a former administrator looted the institution of more than $500,000. In Manila, a U.S. drug company executive says bribery is so ingrained in the system of government procurement of medicine that he forbids his salesmen to solicit business from the Health Ministry. While expressing admiration for many Filipino businessmen and technocrats, George Suter, head of Pfizer Inc. of the Philippines and president of the American Chamber of Commerce in Manila, shrugs: "They have to pay off."

Corruption today is endemic in the Philippines, and there are countless stories in Manila of how graft has enriched friends and relatives of the presidential family. One scheme that apparently generates enormous bribes is the system of government guarantees for loans made by foreign lenders to Filipino businessmen. The going rate for such guarantees is said to be 10% of the value of the loan—unless the Filipino businessman has the right connections with key figures in the Marcos government.

The system of graft has filtered down, most notably in the military. Soldiers manning checkpoints in the countryside regularly shake down farmers for a fixed tribute: 30¢ for every sack of copra going to market. Corruption can also breed brutality. Members of the paramilitary Philippine constabulary are widely accused of extorting protection money from village storekeepers on penalty of gangster-style fires and explosions.

In his speech in Manila last week, Marcos once again pledged to "cleanse the ranks" of the armed forces, but few Filipinos believe such sackings can make much of a difference or that mere dismissal is a sufficient deterrent. More significantly, in the same speech Marcos drew a cheer from assembled soldiers when he announced another round of military pay raises. The fact is that Marcos must have the loyalty of the armed forces, not only to preserve his own rule but also to carry the fight against continuing armed rebellion on two separate fronts.

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