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THE NEW YORK TIMES, SUNDAY MAY 15, 1994

SPAIN PREMIER REJECTS CALLS THAT HE QUIT                        PAGE 13
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By Alan Riding


   MADRID, May 14 - With a series of corruption scandals bringing loud
 emands for his resignation, Prime Minister Felipe Gonzalez has been
reduced to a shadow of the popular and charismatic young leader who swept
to power here 12 years ago.

  Mr. Gonzalez's decline was already apparent in last June's general ele-
tions when his Socialist Party lost its absolute majority of seats in
Congress for the first time since 1982. While he was returned for a fourth
term as Prime Minister, it was as head of a minority government.

  But over the last month, corruption scandals involving major figures in
the Socialist establishment have shattered much of the remaining public
confidence in his government. Today, few Spaniards believe that Mr Gonza-
lez can survive in office until the end of his term in 1997.

  This week, Jose Maria Aznar, the conservative leader whose People's
Party now leads the Socialists in the polls, urged the Prime Minister to
quit "to save us from witnessing an indecorous agony."  Pilar Rahola, a
leftist deputy, told Mr. Gonzalez, "You represent the end of a dream."

Arrests and Resignations

  The crisis has already forced the resignation of two ministers, the arrest
of the former governor of the central bank and the former chairman of the
stock exchange, an arrest order for the former head of the Civil Guard,
who is in hidding, and the resignation of two former Government ministers
from Congress.

  No less a blow, a popular judge renowned for fighting corruption stepped
down as head of the Government's antinarcotics campaign.  The judge,
Baltzar Garzon, bemoaned Mr. Gonzalez's "passive" response to corruption
and said he now believed his inclusion on the Socialist ticket last June
was "an election ploy."

  "It's beginning to look like Italy," one foreign diplomat said, referring
to the chronic political corruption that led to the collapse of Italy's
Socialist and Christian Democrat parties last year.  Corruption also
contributed to the heavy defeat of France's Socialist Government in the
1993 parliamentary elections.

  So far, Mr. Gonzalez's honesty has not been questioned, but he has been
widely critized for not craking down more strongly on Government corruption.
As a measure of mounting public anger, bystanders shouted "Resign!" and
"Crook!" at him on Friday as he arrived at a parade.

Still Refuses to Quit

  Appearing before Congress earlier this week, he again rejected calls for
his resignation. Raising his voice above heckles and taunts of opposition
deputies, he vowed, "I will finish my term with honor, without lowering
my head."

  But if the 52-year-old Prime Minister is still able to hang on to power,
it is only thanks to the support of Catalan and Basque nationalist parties.
Jordi Pujol, the leader of Catalonia's Convergence and Union party who
now holds the Government's fate in his hands, has warned that his support
is "not unconditional."  Mr. Aznar charged that Mr. Gonzalez had "mortgaged"
his government to the regional parties.

  Further weakening the Government, the Socialist Party is itself divided
between pro-business factions loyal to Mr. Gonzalez and left-leaning
currents headed by former Deputy Prime Minister Alfonso Guerra.

  Yet Mr. Gonzalez's main worry has to be that the run of corruption
scandals has not ended.  Almost daily in recent weeks, Spanish newspapers
have disclosed new cases of official corruption or revealed fresh details
about scandals.

Bank Governor Arrested

  Perhaps the most damaging case involves Mariano Rubio who, as head of the
Bank of Spain between 1984 and 1992, served as a crucial bridge betwween
the Government and the financial elite. Such was his prestige that when a
Madrid newspaper reported in 1992 that he had made illegal investments
Mr. Gonzalez himself vouched for his honesty.

  But last month that same newspaper, El Mundo, published documents
suggesting that Mr. Rubio had kept secret bank accounts, engaged in insider
training and evaded taxes.

  Two weeks ago, Mr. Rubio and his broker, Manuel de la Concha, the former
head of the Madrid Stock Exchange, were arrested.

  Last week, Carlos Solchaga, the Socialists' parliamentary leader who
served as Economy Minister until last June, resigned his seat in Congress,
arguing that he had to accept political responsibility for illegal acts
carried out by Mr. Rubio while he was running the central bank.

  The case that has most caught the public's attention involves Luis
Roldan, a Socialist of humble origins who reputedly enriched himself
through kickbacks and illegal real estate deals while heading the 65,000
member Civil Guard.

  The scandal turned into a fullblown political crisis two weeks ago when,
fearing innminent arrest, Mr. Roldan went into hiding.  Trying to shield
the Government from deeper embarrassment, Interior Minister Antoni Asuncion,
promptly resigned. His predecessor, Jose Luis Corcuera, who was responsible
for the Civil Guard until last year, also resigned from Congress.

  In an interview with El Mundo, Mr. Roldan said: "I will not be a
sacrificial lamb. If I go to jail, I am not going alone."

TZ