Reagan Declares Neutrality on Philippines

WASHINGTON--President Reagan said yesterday night the United States is neutral in the bitter Philippines presidential election, and announced plans to send veteran U.S. diplomat Philip Habib to Manila to "help nurture the hopes and possibilities of democracy."

"We're neutral, and we then hope to have the same relationship with the people of the Philippines that we've had all these years," the President said at a nationally televised news conference.

In a written statement distributed moments before he stepped before White House reporters, Reagan said he found it disturbing that the election had been "flawed by reports of fraud, which we take seriously, and by violence."

In his statement, Reagan said he was sending Habib to meet with leaders of both political parties as well as with church and government officials and representatives of private sector groups.

Reagan said he would have no other comment on the election until the ballot count was finished.

The President opened his news conference with a pitch for his 1987 fiscal year budget, and took note of critics who say it is "DOA--dead on arrival." He said those critics only want a tax increase to reduce deficits, adding that any such increase would be "VOA--vetoed on arrival."

Reagan's comments on the Philippines came with the outcome of the election between President Ferdinand E. Marcos and challenger Corazon Aquino still in doubt several days after the balloting closed. Each side has claimed victory, and the Marcos-controlled National Assembly is preparing a final, official canvass.

Reagan added that the administration is concerned "about the violence that was evident there and the possibility of fraud. It could have been all of that was occurring on both sides."

Reagan's session with reporters was his first in five weeks and the 34th of his presidency. It was a session dominated from the outset by foreign policy questions.

Prisoner Exchange

Asked about the release earlier in the day of Soviet dissident Anatoly Shcharansky, Reagan said he "talked at great length about human rights" with Soviet leader Mikhail S. Gorbachev at their summit last November. Reagan said he thought there had been an increase in such emigrations since then, and added, "I hope that this is a beginning sign of what's going to take place."

On another foreign policy issue, the President said the United States' only involvement in the downfall of Haitian President-for-Life Jean Claude Duvalier was in "providing an airplane" to fly him into exile in France. He said Duvalier did not seek advice about his departure, and the United States offered none.

Reagan sidestepped a question of whether the United States would resume aid to Haiti, suspended because of human rights abuses under the Duvalier regime. "We hope we can be of help" in restoring democracy under the new ruling junta, he said.

Kerry Reports

U.S. observers found widespread fraud in the Philippine presidential election, but it could be salvaged if the Marcos-controlled National Assembly can be pressured into counting ballots fairly, Sen. John F. Kerry (D-Mass.) said in separate comments.

Even if the parliament declares Marcos the winner of last Friday's election, Kerry said, the long-time Philippine leader may have to make major concessions to opponents because the voting results will be far closer than he expected.

If he doesn't, Kerry said, Congress will be very reluctant to approve further aid to the Marcos government.

Kerry, a member of a U.S. team led by Sen. Richard Lugar (R-Ind.) that observed last Friday's election said, the voting was marred payoffs, violence and ballot rigging.

But Kerry told a news conference, "The election process is not beyond salvation, providing the right pressures are brought to bear. I'm not saying you have to make a final judgment on the election today."

Kerry said while Clark Air Base and the Subic Bay Navy base are important to the United States, "we can't allow the bases to take precedence over the larger issue of our relationship with the people of the Philippines."

"If the bases become paramount in our policy, I assure you we will lose those bases [by alienating the Filipino people]," Kerry said.