Time on Gloriagate

Under Siege
As a vote-rigging scandal deepens and calls for her resignation grow louder, Philippine President Gloria Macapagal Arroyo is fighting for political survival
BY ANTHONY SPAETH | MANILA

Gloria Macapagal Arroyo spent last week in desperate spin mode. First, the Philippine President went on national television to admit that she had spoken on the phone with an unnamed election official during the counting of votes in the presidential election in May last year—an issue that has galvanized the political opposition for weeks. Arroyo maintained it was an innocent call, not an attempt to rig the ballot, but acknowledged a "lapse in judgment" and asked the citizenry to "close this chapter." So important was the speech that she gave it twice, in English and then in Tagalog, which is more comprehensible to most Filipinos. In the second version, she asked for "forgiveness." On Wednesday, Arroyo addressed a lunch meeting of business executives and announced, with tears in her eyes, that her husband, Jose Miguel, who is being investigated for allegedly receiving kickbacks from an illegal gambling racket, would live outside the Philippines indefinitely to avoid being a target for her critics. "Today, my family is once again called to sacrifice our personal happiness," she said. The next day, Arroyo accepted the resignation of Agriculture Secretary Arthur Yap, who has been charged with tax evasion (which he denies).

Even as Arroyo was trying to rescue her presidency from a vertiginous tailspin, a potential rallying figure for the opposition made a dramatic debut. At a press conference carried live on TV and radio, Susan Roces, the widow of the challenger in last year's election, Fernando Poe Jr., said Arroyo's apology to the nation proved that her late husband was cheated out of the presidency. Poe, who died of a stroke last December, was a popular film actor. Roces is one too, as beloved among regular people as her husband was, and she chewed up the scenery in the role of the Furious Widow. "[Arroyo] can lie through her teeth with a straight face," she seethed. "She's arrogant!" Roces said she'd gladly join street protests to get Arroyo to resign—heightening the prospect, remote until now, of People Power demonstrations. Then, on Friday, the Supreme Court, acting on a petition by opposition legislators and oil dealers, suspended an unpopular value-added tax that had gone into effect only hours earlier. The tax was a key part of Arroyo's plan to raise government revenues to plug the Philippines' chronic budget deficit, and its suspension was a major blow to the President's hopes of revitalizing the economy.

It was, in short, a week from hell for Arroyo, a 58-year-old former economics professor who once seemed exactly the kind of leader the Philippines needed. A policy wonk with a Ph.D. from Georgetown University, Arroyo came to power in 2001 in a People Power revolt that toppled another movie star, President Joseph Estrada, who had been weakened by a flood of corruption allegations and a failed impeachment trial. Last year's election was meant to legitimize Arroyo's rule; and the middle class and the business sector, at least, were relieved when she beat Poe—the country badly needed economic reform, which Arroyo seemed far more capable of delivering. Better governance finally appeared to be at hand. Now that's all threatened because of scandals of the common sort in the Philippines—election cheating, graft—and Arroyo's handling of them. The nation, yet again, is living up to its reputation as unstable and perpetually in crisis. "Mrs. Arroyo has become the symbol of everything that is wrong in Philippine governance," says Randolf S. David, professor of sociology at the University of the Philippines. "Many believe that the longer she remains in office, the more the crisis engulfs the whole system."

Arroyo has chosen to break an old rule of politics—"never apologize, never explain"—in a gamble that she can rise above Manila's deafening political noise and appeal directly to the people. Her message: "My administration may have lost its way, but give me a second chance." And she may be orchestrating more damage control. Congressman Joey Salceda, part of the President's economic team, told the press last week that Arroyo was planning major changes in the way the government operates. "The political misfortunes of the President are reversible," he said. Nicandro Arcena, 57, a security guard in Manila, agrees—up to a point. "Arroyo, for the time being, should be retained," he says, "because she hasn't been proved guilty yet. If she is found guilty, she has to go. But who will replace her? It's possible we'd get someone even worse."

The risk of spring cleaning one year into a presidential term is that skeletons get exposed. News photos of Arroyo's husband arriving in Hong Kong—besides him, his brother and the Arroyos' eldest son have also been accused of accepting money from illegal gambling, which they have all denied—gained the President sympathy in some quarters. But the reverse reaction was also widespread, with some arguing that Arroyo was tacitly admitting to her husband's guilt and letting him escape judgment by Philippine law. "Going into exile? He's just going to have fun in California," says Homobono Adaza, a former immigration commissioner. "He should come back and face the music."

Arroyo's admission that she had talked on the phone with an election officer was potentially more damaging. A taped recording of a purported conversation between a woman who sounds like Arroyo and an election official has been circulating around the country for weeks on CDs, and even as a cell-phone ring tone. Arroyo did not mention the tape in her address last week, and her aides have claimed that the recording was doctored. In the conversations the female voice appears to be trying to influence the vote counting.

Arroyo's televised apology has alienated some of her close supporters. Roilo Golez, a former National Security Adviser to Arroyo and one of her chief congressional allies, says it proved to him that she had manipulated the election and had been covering it up for the past month. "She no longer occupies the moral high ground," Golez told Time. "How can she discipline the military? How can she talk about people paying taxes with that cloud of doubt over her? She's left with no other honorable alternative but resignation." A crack in Arroyo's ruling coalition could have serious repercussions: the bloc has solid control of both houses of the Philippine Congress, which has insulated the President from impeachment. The opposition senses her vulnerability. On Friday, Salvador Enriquez, a former Budget Secretary, told the press: "She has to decide whether to resign or to make it a game of chess."

On the ground in Manila, the political jousting looks less like chess than a Roller Derby with chain saws. At meetings in coffee shops across the capital last week, retired generals volunteered to serve in juntas or "transitional governments," and political organizations of all stripes called for Arroyo to resign. Adding to the sense of crisis, TV news is now dominated by a congressional investigation of the wiretapped election phone calls and a Senate probe into alleged payoffs to her husband. Low-key Vice President Noli de Castro, a former TV anchorman with no previous experience in public office, told his old TV station last week that while he stands by his "courageous" President, he is capable of taking over from her if circumstances require it. Malacañang Palace defended De Castro's remarks and said the President continued to have confidence in him, but his comments prompted the press to accuse him of being overambitious. "This is [getting] emotional," sighs Amando Doronila, a veteran political columnist. "Very few people are using their heads."

The turmoil is beginning to demoralize even Arroyo's staunchest backers. She had persuaded Congress to pass a handful of revenue-boosting laws—including tax hikes on liquor and cigarettes, and the now suspended VAT—which she'd hoped would raise the cash to start rejuvenating the country. Those measures were welcomed in particular by members of the business community. Now, however, they too are starting to question their allegiance to Arroyo. "She's in trouble," says Edward L. Fereira, a businessman and former president of the Management Association of the Philippines. "The peso has depreciated, the stock market has gone down, she's expanded taxes: this hurts the people, and she has lost her credibility."

Washington, which has provided the Philippines with financial and military aid under Arroyo, is likewise watching the unfolding crisis with concern. The Bush Administration counts the Philippines as one of its partners in the global war on terror. But it has been frustrated by Arroyo's inability to enact antiterrorism legislation, which has been stymied by Congress. The Philippines needs such laws: it's wracked by a host of Islamic insurgencies that the local authorities assert are linked with Jemaah Islamiah, the regional network of extremists. With Arroyo under siege, such legislation could prove even harder to pass. So far the only comment Washington has made about Arroyo's troubles is that any move against her should follow due process. "The search for truth should be done within legal avenues," said the U.S. chargé d'affaires in Manila, Joseph Mussomeli, in a statement last week, "and in a way that best serves the welfare of the Filipino people."

Everything depends on whether Arroyo's contrition clicks with the public and enables her to hold on to power—or whether it backfires. "I have a lot of stories of her courage and coolness under fire," says former adviser Roilo Golez. "She's going to be tough. But when she made the decision to speak, the mea culpa thing, she was going into the unknown." So is the Philippines.

With reporting by Nelly Sindayen/Manila