Part 60 (2/2)

What is still most needed to give a stimulus to agriculture and the general material development of the Islands is the conversion of hundreds of miles of existing highways and mud-tracks into good hard roads, so as to facilitate communication between the planting-districts and the ports. The corallaceous stone abounding in the Islands is worthless for road-making, because it pulverizes in the course of one wet season, and, unfortunately, what little hard stone exists lies chiefly in inaccessible places--hence its extraction and transport would be more costly than the supply of an equal quant.i.ty of broken granite brought over in sailing-s.h.i.+ps from the Chinese coast, where it is procurable at little over the quarryman's labour. From the days of the Romans the most successful colonizing nations have regarded road-making as a work of primary importance and a civilizing factor.

Among the many existing projects, there is one for the construction of railroads (1) from Manila (or some point on the existing railway) northward through the rich tobacco-growing valleys of Isabela and Cagayan, as far as the port of Aparri, at the mouth of the Cagayan River--distance, 260 miles; (2) from Dagupan (Pangasinan) to Laoag (Ilocos Norte), through 168 miles of comparatively well-populated country; (3) from San Fabian (Pangasinan) to Baguio (Benguet), 55 miles; and three other lines in Luzon Island and one in each of the islands of Negros, Panay, Cebu, Leyte, and Samar. A railway line from Manila to Batangas, _via_ Calamba (a distance of about 70 miles), and thence on to Albay Province, was under consideration for many years prior to the American advent; but the poor financial result of the only (120 miles) line in the Colony has not served to stimulate further enterprise in this direction, except an endeavour of that same company to recuperate by feeder branches, two of which are built, and another (narrow gauge) is in course of construction from Manila to Antipolo, _via_ Pasig and Mariquina (_vide_ Railways, p. 265).

Since February, 1905, a Congress Act, known as the ”Cooper Bill,”

offers certain inducements to railway companies. It authorizes the Insular Government to guarantee 4 per cent, annual interest on railway undertakings, provided that the total of such contingent liability shall not exceed $1,200,000--that is to say, 4 per cent, could be guaranteed on a maximum capital of $30,000,000. The Insular Government is further empowered under this Act to admit, at its discretion, the entry of railway material free of duty. As yet, no railway construction has been started by American capitalists. Projects _ad infinitum_ might be suggested for the development of trade and traffic--for instance, a s.h.i.+p-ca.n.a.l connecting the Laguna de Bay with the Pacific Ocean; another from Laguimanoc to Atimonan (Tayabas); an artificial entry-port in Negros Island, connected by railway with two-thirds of the coast, etc.

Up to the present the bulk of the export and import trade is handled by Europeans, who, together with native capitalists, own the most considerable commercial and industrial productive ”going concerns”

in the Islands. In 1904 there were one important and several smaller American trading-firms (exclusive of shopkeepers) in the capital, and a few American planters and successful prospectors in the provinces. There are hundreds of Americans about the Islands, searching for minerals and other natural products with more hopeful prospects than tangible results. It is perhaps due to the disturbed condition of the Islands and the ”Philippines for the Filipinos”

policy that the antic.i.p.ated flow of private American capital has not yet been seen, although there is evidently a desire in this direction. There is, at least, no lack of the American enterprising spirit, and, since the close of the War of Independence, several joint-stock companies have started with considerable cash capital, princ.i.p.ally for the exploitation of the agricultural, forestal, and mineral wealth of the Islands. Whatever the return on capital may be, concerns of this kind, which operate at the natural productive sources, are obviously as beneficial to the Colony as trading can be in Manila--the emporium of wealth produced elsewhere.

There are, besides, many minor concerns with American capital, established only for the purpose of selling to the inhabitants goods which are not an essential need, and therefore not contributing to the development of the Colony.

The tonnage entered in Philippine ports shows a rapid annual increase in five years. Many new lines of steamers make Manila a port of call, exclusive of the army transports, carrying Government supplies, and in 1905 there was a regular goods and pa.s.senger traffic between Hong-Kong and Zamboanga. Still, the greater part of the freight between the Philippines and the Atlantic ports is carried in foreign bottoms. The s.h.i.+pping-returns for the year 1903 would appear to show that over 85 per cent, of the exports from the Islands to America, and about the same proportion of the imports from that country (exclusive of Government stores brought in army transports) were borne in foreign vessels. The carrying-trade figures for 1904 were 78.41 per cent, in British bottoms; 6.69 per cent, in Spanish, and 6.65 per cent, in American vessels. The desire to dispossess the foreigners of the carrying monopoly is not surprising, but it is thought that immediately-operative legislation to that end would be impracticable. The latest legislation on the subject confines the carrying-trade between the Islands and the United States to American bottoms from July 1, 1906. It is alleged that the success of the new regulations which may (or may not, for want of American vessels) come into force on that date will depend on the freights charged; it is believed that exorbitant outward rates would divert the hemp cargoes into other channels, and a large rise in inward freights would facilitate European compet.i.tion in manufactured goods. Any considerable rise in freights to America would tend to counterbalance the benefits which the Filipinos hope to derive from the free entry of sugar and tobacco into American ports. The text of the s.h.i.+pping Law, dated April 15, 1904, reads thus; ”On and after July 1, 1906, no merchandise shall be transported by sea, under penalty of forfeiture thereof, between ports of the United States and ports or places of the Philippine Archipelago, directly, or _via_ a foreign port, or for any part of the voyage in any other than a vessel of the United States. No foreign vessel shall transport pa.s.sengers between ports of the United States and ports or places in the Philippine Archipelago, either directly, or _via_ a foreign port, under a penalty of $200 for each pa.s.senger so transported and landed.”

The expenses of the Civil Government are met through the insular revenues (the Congressional Relief Fund being an extraordinary exception). The largest income is derived from the Customs'

receipts, which in 1904 amounted to about $8,750,000, equal to about two-thirds of the insular treasury revenue (as distinguished from the munic.i.p.al). The total _Revenue and Expenditure_ in the fiscal year 1903 (from all sources, including munic.i.p.al taxes expended in the respective localities, but exclusive of the Congressional Relief Fund) stood thus:--

Total Revenue $14,640,988 Total Expenditure $15,105,374 Excess of Expenditure over Revenue 464,386 ========== ========== 15,105,374 15,105,374

In 1903, therefore, Government cost the inhabitants the equivalent of about 46 per cent, of the exports' value, against 45 per cent, in Spanish times, taking the relative averages of 1890-94. The present abnormal pecuniary embarra.s.sment of the people is chiefly due to the causes already explained, and perhaps partly so to the fact that the P30,000,000 to P40,000,000 formerly in circulation had two to three times the local purchasing value that pesos have to-day.

The ”Cooper Bill,” already referred to, authorizes the Insular Government to issue bonds for General Public Works up to a total of $5,000,000, for a term of 30 years, at 4 1/2 per cent, interest per annum; and the munic.i.p.alities to raise loans for munic.i.p.al improvements up to a sum not exceeding 5 per cent. of the valuation of the real estate of the munic.i.p.alities, at 5 per cent. interest per annum. For the purchase of the friars' lands a loan of $7,000,000 exists, bearing interest at 4 per cent. per annum, the possible interest liability on the total of these items amounting to about $2,000,000 per annum.

On November 15, 1901, the high Customs tariff then in force was reduced by about 25 per cent. on the total average, bringing the average duties to about 17 per cent. _ad valorem_, but this was again amended by the new tariff laws of May 3, 1905. Opium is still one of the imports, but under a recent law its introduction is to be gradually restricted by tariff until March 1, 1908, from which date it will be unlawful to import this drug, except by the Government for medicinal purposes only.

On August 1, 1904, a new scheme of additional taxation came into force under the ”Internal Revenue Law of 1904.” This tax having been only partially imposed during the first six months, the full yield cannot yet be ascertained, but at the present rate(P5,280,970.96, partial yield for the fiscal year 1905) it will probably produce at the annual rate of $4,250,000 gold, which, however, is not entirely extra taxation, taking into account the old taxes repealed under Art. XVII., sec. 244. The theory of the new scheme was that it might permit of a lower Customs tariff schedule. The new taxes are imposed on distilled spirits, fermented liquors, manufactured tobacco, matches, banks and bankers, insurance companies, forestry products, valid mining concessions granted prior to April 11, 1899, business, manufactures, occupations, licences, and stamps on specified objects (Art. II., sec. 25). Of the taxes accruing to the Insular Treasury under the above law, 10 per cent. is set apart for the benefit of the several provincial governments, apportioned _pro rata_ to their respective populations as shown by the census of 1903; 15 per cent. for the several munic.i.p.al governments, provided that of this sum one-third shall be utilized solely for the maintenance of free public primary schools and expenditure appertaining thereto. In the aforesaid distribution Manila City ranks as a munic.i.p.ality and a province, and receives apportionment under this law on the basis of 25 per cent. (Art. XVII., sec. 150).

From the first announcement of the projected law up to its promulgation the public clamoured loudly against it. For months the public organs, issued in Spanish and dialect, persistently denounced it as a harbinger of ruin to the Colony. Chambers of Commerce, corporations and private firms, foreign and native, at meetings specially convened to discuss the new law, predicted a collapse of Philippine industry and commerce. At a public conference, held before the Civil Commission on June 24, 1904, it was stated that one distillery alone would have to pay a yearly tax of P744,000, and that a certain cigar-factory would be required to pay annually P557,425. Pet.i.tions against the coming law were sent by all the representative trading-bodies to the Insular Government praying for its withdrawal. When the Commissioners retired to their hill-station at Baguio (Benguet) they were followed up by protests against the measure, but it became law under Philippine Commission Act No. 1189. Since the imposition of this tax there has been a general complaint throughout the civilized provinces of depression in the internal trade, but to what extent it is justified there is no available precise data on which to form an estimate.

As already stated, the American occupation brought about a rapid rise in the price of everything, not of necessity or in obedience to the law of supply and demand, but because it was the pleasure of the Americans voluntarily to enhance established values. To the surprise of the Filipinos, the new-comers preferred to pay wages at hitherto unheard-of rates, whilst the soldiers lavishly paid in gold for silver-peso value (say, at least, double), of their own volition--an innovation in which the obliging native complacently acquiesced, until it dawned upon him that he might demand anything he chose. The soldiers so frequently threw away copper coin given them in change as valueless, that many natives discontinued to offer it. It followed that everybody was reluctantly compelled to pay the higher price which the American spontaneously elected to give. Labour, food, house-rent, and all the necessaries of life rose enormously. [294]

The Colony soon became converted from a cheap into an expensive place of residence. Living there to-day costs at least three times what it did in Spanish times. Urban property and lands were a.s.sessed at values far beyond those at which the owners truly estimated them. Up to 1904 it was not at all uncommon to find the rent of a house raised to five times that of 1898. Retailers had to raise their prices; trading-firms were obliged to increase their clerks' emoluments, and in every direction revenue and expenditure thenceforth ranged on an enhanced scale. It is remarkable that, whilst pains were taken by the new-comers to force up prices, many of them were simultaneously complaining of expensive living! Governor W. H. Taft, with an annual emolument of $20,000 gold, declared before the United States Senate that the Gov.-General's palace at Malacanan was too expensive a place for him to reside in. The lighting of the establishment cost him $125 gold a month, and his servants' wages amounted to $250 monthly. He added that he would rather pay his own rent than meet the expenses of the Malacanan residence. [295]

Two and a half years later General Leonard Wood reported:

”There has been a great increase in the cost of living and in wages in this (Moro) as in other provinces--an increase which has not been accompanied either by improved methods or increased production. The cause of the increase can be traced, in most cases, to the _foolishly high prices paid_ by army officials for labour.” [296]

Wages steadily advanced as a natural consequence of the higher cost of living, and, under the guidance of a native demagogue, the working cla.s.ses, for the first time in Philippine history, collectively began to grumble at the idea of labour-pay having a limit. It was one of the abuses of that liberty of speech suddenly acquired under the new dominion. On February 2, 1902, this person organized the malcontents under the t.i.tle of a ”Labour Union,” of which he became the first president. The subscription was 20 cents of a peso per week. The legality of peacefully relinquis.h.i.+ng work when the worker felt so inclined was not impugned; but when the strikers sought to coerce violently their fellow-men, the law justly interfered and imprisoned their leader. The presidency of the so-called ”Labour Union” was thenceforth (September following) carried on by a half-caste, gifted with great power of organization and fluent oratory. He prepared the by-laws of the a.s.sociation, and fixed the monthly subscription at one peso per man and one peseta (one-fifth of a peso) per woman. About 100,000 members were enrolled in the union, the ostensible aim of which was the defence of the working man's interests. It is difficult to discern what those interests were which needed protection; the position of the labouring cla.s.s was the very reverse of that existing in Europe; the demand for labourers, at any reasonable wage, exceeded the supply. The idea of a Filipino philanthropically devoting his life to the welfare of the ma.s.ses was beyond the conception of all who understood the Philippine character. At the end of about eight months, notwithstanding the enormous a.s.sets from subscriptions, the ”Labour Union” became insolvent, with a deficit of 1,000 or more pesos. Where the a.s.sets had gone needed investigation. In the meantime the leader, posing as mediator between the Insular Government and certain notorious outlaws, had endeavoured to negotiate with Governor W. H. Taft for their surrender, on the condition of full pardon. The Government, at length, becoming suspicious of his intentions and the full measure of his sympathy for these individuals, caused the leader to be arrested on May 29, 1903, on the allegations of ”founding, directing, and presiding over an illegal a.s.sociation known as 'The Democratic Labour Union,'”

irregularities connected with the foundation and administration of the same, sedition, confederacy with brigands, and other minor counts.

It was clear to every thinking man, American or European, that the control of such a formidable body was a menace to peace. The accused was brought to trial on the chief allegations, and in September, 1903, he was sentenced to four years and two months' imprisonment, but appealed against the sentence to the Supreme Court. Later on he was tried on the other counts, and, although the public prosecution failed, it served the useful purpose of dissolving a league the scope of which was shrouded in obscurity, at a period when the political atmosphere was still clouded by aspirations of impossible and undesirable realization. I followed the course of the trial daily, and I interviewed the accused at his house a week before it ended. Three hundred doc.u.ments were read at the trial, and 160 witnesses were brought against him. To endeavour to establish a case of conspiracy against him, another individual was produced as his colleague. The first accused was defended by an American advocate with such fervid eloquence, apparently inspired by earnest conviction of his client's innocence, that those who had to decide his fate acquitted him of the charge of conspiracy on May 11, 1904. The defendant's verbal explanation to me of the ”Labour Union” led me to the conclusion that its abolition would benefit the community.

The abnormal rise in wages had the bad effect of inducing the natives to leave their pastoral pursuits to flock into the towns. The labour question is still a difficult problem, for it is the habit of the Filipino to discontinue work when he has a surplus in his pocket. Private employers complain of scarcity and the unreliability of the unskilled labourer. Undoubtedly the majority of them would welcome the return of Chinese coolies, whose entry into the Islands is prohibited by the Insular Government, in agreement with the desire of the Filipinos, who know full well that the industrious Chinaman would lower wages and force the Filipinos into activity for an existence.

<script>