XIII. Spanish Insular Government…

XIII. Spanish Insular Government

From the days of Legaspi the supreme rule in these Islands was usually confided for indefinite periods to military men: but circumstances frequently placed naval officers, magistrates, the Supreme Court, and even ecclesiastics at the head of the local government. During the last half century of Spanish rule the common practice was to appoint a Lieut.-General as Governor, with the local rank of Captain-General pending his three-years' term of office. An exception to this rule in that period was made (1883-85) when Joaquin Jovellar, a Captain-General and ex-War Minster in Spain, was specially empowered to establish some notable reforms--the good policy of which was doubtful. Again, in 1897, Fernando Primo de Rivera, Marquis de Estella, also a Captain-General in Spain, held office in Manila under the exceptional circumstances of the Tagalog Rebellion of 1896, in succession to Ramon Blanco, Marquis de Pena Plata. Considering that Primo de Rivera, during his previous Gov.-Generalship (1880-83), had won great popularity with the Filipinos, he was deemed, in Madrid, to be the man most capable of arresting the revolutionary movement. How far the confidence of the Home Government was misplaced will be seen in Chapter xxii.

Soon after the conquest the Colony was divided and sub-divided into provinces and military districts as they gradually yielded to the Spanish sway. Such districts, called Encomiendas, [97] were then farmed out to Encomenderos, who exercised little scruple in their rigorous exactions from the natives. Some of the Encomenderos acquired wealth during the terms of their holdings, whilst others became victims to the revenge of their subjects. They must indeed have been bold, enterprising men who, in those days, would have taken charge of districts distant from the capital. It would appear that their tenure was, in a certain sense, feudal, for they were frequently called upon to aid the Central Government with vessels, men, and arms against the attacks of common enemies. Against Mahometan incursions necessity made them warriors,--if they were not so by taste,--civil engineers to open communications with their districts, administrators, judges, and all that represented social order. Encomiendas were sometimes given to Spaniards as rewards for high services rendered to the commonwealth, [98] although favouritism or (in later years) purchase-money more commonly secured the vacancies, and the holders were quite expected to make fortunes in the manner they thought fit, with due regard for the Royal Treasury (vide p. 54).

The Encomenderos were, in the course of time, superseded by Judicial Governors, called Alcaldes, who received small salaries, from L60 per annum and upwards, but were allowed to trade. The right to trade--called "indulto de comercio"--was sold to the Alcalde-Governors, except those of Tondo, [99] Zamboanga, Cavite, Nueva Ecija, Islas Batanes and Antique, whose trading right was included in the emoluments of office. The Government's object was economy.

In 1840 Eusebio Mazorca wrote thus [100]:--"The salary paid to the chiefs of provinces who enjoy the right of trade is more or less P300 per annum, and after deducting the amount paid for the trading right, which in some provinces amounts to five-sixths of the whole--as in Pangasinan; and in others to the whole of the salary--as in Caraga; and discounting again the taxes, it is not possible to conceive how the appointment can be so much sought after. There are candidates up to the grade of brigadier who relinquish a P3,000 salary to pursue their hopes and projects in governorship."

This system obtained for many years, and the abuses went on increasing. The Alcaldes practically monopolized the trade of their districts, unduly taking advantage of their governmental position to hinder the profitable traffic of the natives and bring it all into their own hands. They tolerated no competition; they arbitrarily fixed their own purchasing prices, and sold at current rates. Due to the scarcity of silver in the interior, the natives often paid their tribute to the Royal Treasury in produce,--chiefly rice,--which was received into the Royal Granaries at a ruinously low valuation, and accounted for to the State at its real value; the difference being the illicit profit made by the Alcalde. Many of these functionaries exercised their power most despotically in their own circuits, disposing of the natives' labour and chattels without remuneration, and not unfrequently, for their own ends, invoking the King's name, which imbued the native with a feeling of awe, as if His Majesty were some supernatural being.

In 1810 Tomas de Comyn wrote as follows:--"In order to be a chief of a province in these Islands, no training or knowledge or special services are necessary; all persons are fit and admissible.... It is quite a common thing to see a barber or a Governor's lackey, a sailor or a deserter, suddenly transformed into an Alcalde, Administrator, and Captain of the forces of a populous province without any counsellor but his rude understanding, or any guide but his passions." [101]

By Royal Decree of 1844 Government officials were thenceforth strictly prohibited to trade, under pain of removal from office.

In the year 1850 there were 34 Provinces, and two Political Military Commandancies. Until June, 1886, the offices of provincial Civil Governor and Chief Judge of that province were vested in the same person--the Alcalde Mayor. This created a strange anomaly, for an appeal against an edict of the Governor had to be made to himself as Judge. Then if it were taken to the central authority in Manila, it was sent back for "information" to the Judge-Governor, without independent inquiry being made in the first instance; hence protest against his acts was fruitless.

During the Regency of Queen Maria Christina, this curious arrangement was abolished by a Decree dated in Madrid, February 26, 1886, to take effect on June 1 following.

Eighteen Civil Governorships were created, and Alcaldes' functions were confined to their judgeships; moreover, the Civil Governor was assisted by a Secretary, so that two new official posts were created in each of these provinces.

The Archipelago, including Sulu, was divided into 19 Civil Provincial Governments, four Military General Divisions, 43 Military Provincial Districts, and four Provincial Governments under Naval Officers, forming a total of 70 Divisions and Sub-Divisions.

COST OF SPANISH ADMINISTRATION

P. cts.

The Gov.-General received a salary of 40,000 00

The Central Government Office, called "Gobierno General," with its Staff of Officials and all expenses 43,708 00

The General Government Centre was assisted in the General Administration of the Islands by two other Governing Bodies, namely:

The General Direction of Civil Administration 29,277 34

The Administrative Council 28,502 00

The Chief of the General Direction received a salary of P12,000, with an allowance for official visits to the Provinces of P500 per annum.

The Council was composed of three Members, each at a salary of P4,700, besides a Secretary and officials.

Seventy divisions and sub-divisions as follows, viz.:--

CIVIL GOVERNMENTS

Manila Pce Salary of Civil Governor P5,000 Total Cost. 20,248 00

Alday, Batangas, Bulacan, Ilocos Norte, Ilocos Sur, La Laguna, Pampanga, Pangasinan. Eight First-Class Govts.: Salary of each Civil Gov. P4,500 Total cost of each Govt. P8,900 Eight First-Class Govts. cost 71,200 00

Bataan, Camarines Norte, Camarines Sur, Mindoro, Nueva Eclia, Tayabas, Zambales. Seven Second-Class Govts.: Salary of each Civil Gov. P4,000 Total cost of each Govt. P7,660 Seven Second-Class Govts. cost 53,620 00

Cagayan, Isabela, Nueva Vizcaya Three Third-Class Govts.: Salary of each Civil Gov. P3,500 Total cost of each Govt. P6,700 Three Third-Class Govts. cost 20,100 00

MILITARY GENERAL GOVERNMENTS

Under a Brig.-Gen. and Staff

Gen. Division of S. Visayas 10,975 00 Gen. Division of N. Visayas 10,975 00 Gen. Division of Mindanao 17,825 00 Gen. Division of Cavite 6,596 66

MILITARY PROVINCES AND DISTRICTS

Under a Colonel and Staff

Sulu 7,240 00 Yloilo 4,410 00 Cottabato 5,426 00

Under a Lieut.-Colonel and Staff

East Carolines and Pelew Islands 4,900 00 West Carolines and Pelew Islands 5,970 00 Cebu 3,500 00 Capiz 3,500 00 Misamis 4,816 66 Ladrone Islands 4,975 00

Under a Major and Staff

Zamboanga 3,856 66 Surigao 4,356 66 Davao 4,156 66 Dapitan 2,692 00 Zucuran 2,692 00

La Union, Antique, Samar, Leyte, El Abra, Bojol, Tarlac, Negros, Morong Each under a Major:-- Nine Districts @ P3,040 27,360 00 Batanes, Calamianes, Romblun, Benguet, Lepanto, Burias, Infante, Principe, Bontoc, Concepcion: Each under a Captain:-- Ten Districts @ P1,980 19,800 00

Cagayan (Mindanao)--Biling, Nueva Vizcaya, Sasangani (Palauan) Each under a Captain:-- Five Districts @ P1,792 8,960 00

Siassi, Bongao, Tatoan Each under a Captain:-- Three Districts @ P2,032 6,096 00 Escalante, [102] under a Lieutenant 1,525 00

Masbate, under a Cavalry Sub-Lieutenant 1,450 00

PROVINCIAL GOVERNMENTS UNDER NAVAL OFFICERS, OFFICERS IN CHARGE OF NAVAL STATIONS AS EX-OFFICIO GOVERNORS

Corregidor 3,821 00 Balabac 3,960 00 Isabela de Basilan 5,276 66 Palauan (Puerta Princesa) 6,910 00

Total cost of General Government of the Islands 500,677 96

Deduct-- Officers' Pay, etc., included in Army Estimates P145,179 96 Officers' Pay, etc., included in Navy Estimates 14,640 00

159,819 96

P340,858 00

The Spanish Government intended, in due course, to establish Civil Government throughout the Islands. A Civil Governor was the representative of the Gov.-General, whose orders and decrees he had to publish and execute at his own discretion. He could not absent himself from his province without permission. He had to maintain order, veto petitions for arms' licences, hold under his orders and dispose of the Civil Guard, Carabineers, and local guards. He could suspend the pay for ten days of any subordinate official who failed to do his duty, or he could temporarily suspend him in his functions with justifiable cause, and propose to the Gov.-General his definite removal. He had to preside at all municipal elections; to bring delinquents to justice; to decree the detention on suspicion of any individual, and place him at the disposal of the chief judge within three days after his capture; to dictate orders for the government of the towns and villages; to explain to the petty-governors the true interpretation of the law and regulations affecting their districts.

The Governor was chief of police, and could impose fines up to P50 without the intervention of judicial authority; and in the event of the mulcted person being unable to pay, he could order his imprisonment at the rate of one day's detention for each half-peso of the fine; it was provided, however, that the imprisonment could not exceed 30 days in any case. He had to preside at the ballot for military conscription, but he could delegate this duty to his Secretary, or, failing him, to the Administrator. Where no harbour-master had been appointed, the Civil Governor acted as such. He had the care of the primary instruction; and it was his duty specially to see that the native scholars were taught the Spanish language. Land concessions, improvements tending to increase the wealth of the province, permits for felling timber, and the collection of excise taxes were all under his care. He had also to furnish statistics relating to the labour poll-tax; draw up the provincial budget; render provincial and municipal accounts, etc., all of which had to be counter-signed under the word Intervine by the Secretary. He was provincial postmaster-general, chief of telegraph service, prisons, charities, board of health, public works, woods and forests, mines, agriculture and industry. Under no circumstances could he dispose of the public funds, which were in the care of the Administrator and Interventor, and he was not entitled to any percentages (as Alcalde-Governors formerly were), or any emoluments whatsoever further than his fixed salary.

A Governor had to be a Spaniard over 30 years of age. It is curious to note, from its political significance, that among the many classes of persons eligible for a Civil Governorship were those who had been Members of the Spanish Parliament or Senate during one complete session.

Upon the whole, a Provincial Governor passed life very comfortably if he did not go out of his way to oppress his subjects and create discord. His tranquillity, nevertheless, was always dependent upon his maintaining a good understanding with the priesthood of his district, and his conformity with the demands of the friars. If he had the misfortune to cross their path, it brought him a world of woe, and finally his downfall. There have been Provincial Governors who in reality held their posts by clerical influence, whilst others who exercised a more independent spirit--who set aside Church interests to serve those of the State, with which they were intrusted--fell victims to sacerdotal intrigue; for the subordinates of the hierarchy had power to overthrow as well as to support those who were appointed to their districts. Few improvements appear to have been made in the provinces by the initiative of the local Governors, nor did they seem to take any special interest in commercial and agricultural advancement. This lack of interest was somewhat excusable and comprehensible, however, seeing that after they were appointed, and even though they governed well within the strict limitations of their office, they were constantly expecting that a ministerial change or the fall of a single minister might remove them from their posts, or that the undermining influence of favouritism might succeed in accomplishing their withdrawal. It was natural, therefore, that they should have been indifferent about the fostering of new agricultural enterprises, of opening tracks for bringing down timber, of facilitating trade, or of in any way stimulating the development of the resources of a province when the probability existed that they would never have the personal satisfaction of seeing the result of their efforts.

Some Governors with whom I am personally acquainted have, in spite of all discouragement, studied the wants of their provinces, but to no purpose. Their estimates for road-making and mending, bridge-building, and public works generally were shelved in Manila, whilst the local funds (Fondos locales), which ought to have been expended in the localities where they were collected, were seized by the authorities in the capital and applied to other purposes.

An annual statement of one province will be sufficient, as an example, to illustrate the nature of this local tax:--

LOCAL FUNDS [103]--ALBAY PROVINCE

Provincial Revenue

P. cts. P. cts. Stamps on Weights and Measures 2,490 00 Billiard Tax and Live Stock credentials 496 00 90% of fines for shirking forced labour 1,500 00 Tax in lieu of forced labour 85,209 00 Vehicle tax 4,000 00

93,695 00

Municipal Revenue

Tax paid by sellers in the public market-place 7,050 00 Tax on slaughter of animals for food 12,098 00 Tax on local sales of hemp 40 00 90% of the Municipal fines and tax on Chinese 554 00 10% on tithes paid and house-property tax 380 00 10% on Industrial licences 5,710 00 10% on Alcohol licences 2,525 00

28,357 00 ======== == P122,052 00

In the same year this province contributed to the common funds of the Treasury a further sum of P133,009.

There was in each town another local tax called Caja de Comunidad, contributed to by the townspeople to provide against any urgent necessity of the community, but it found its way to Manila and was misappropriated, like the Fondos locales.

There was not a peso at the disposal of the Provincial Governor for local improvements. If a bridge broke down so it remained for years, whilst thousands of travellers had to wade through the river unless a raft were put there at the expense of the very poorest people by order of the petty-governor of the nearest village. The "Tribunal," which served the double purpose of Town Hall and Dak Bungalow for wayfarers, was often a hut of bamboo and palm-leaves, whilst others, which had been decent buildings generations gone by, lapsed into a wretched state of dilapidation. In some villages there was no Tribunal at all, and the official business had to be transacted in the municipal Governor's house. I first visited Calamba (La Laguna) in 1880, and for 14 years, to my knowledge, the headmen had to meet in a sugar-store in lieu of a Tribunal. In San Jose de Buenavista, the capital town of Antique Province, the Town Hall was commenced in good style and left half finished during 15 years. Either some one for pity's sake, or the headmen for their own convenience, went to the expense of thatching over half the unfinished structure, which was therefore saved from entire ruin, whilst all but the stone walls of the other half rotted away. So it continued until 1887, when the Government authorized a partial restoration of this building.

As to the roads connecting the villages, quite 20 per cent. of them serve only for travellers on foot, on horse or on buffalo back at any time, and in the wet season certainly 60 per cent, of all the Philippine highways are in too bad a state for any kind of passenger conveyance to pass with safety. In the wet season, many times I have made a sea journey in a prahu, simply because the highroad near the coast had become a mud-track, for want of macadamized stone and drainage, and only serviceable for transport by buffalo. In the dry season the sun mended the roads, and the traffic over the baked clods reduced them more or less to dust, so that vehicles could pass. Private property-owners expended much time and money in the preservation of public roads, although a curious law existed prohibiting repairs to highways by non-official persons.

Every male adult inhabitant (with certain specified exceptions) had to give the State fifteen days' labour per annum, or redeem that labour by payment. Of course thousands of the most needy class preferred to give their fifteen days. This labour and the redemption-money were only theoretically employed in local improvements. This system was reformed in 1884 (vide p. 224).

The Budget for 1888 showed the trivial sum of P120,000 to be used in road-making and mending in the whole Archipelago. It provided for a Chief Inspector of Public Works with a salary of P6,500, aided by a staff composed of 48 technical and 82 non-technical subordinates. As a matter of fact, the Provincial and District Governors often received intimation not to encourage the employment of labour for local improvements, but to press the labouring-class to pay the redemption-tax to swell the central coffers, regardless of the corresponding misery, discomfort, and loss to trade in the interior. But labour at the Governor's disposal was not alone sufficient. There was no fund from which to defray the cost of materials; or, if these could be found without payment, some one must pay for the transport by buffaloes and carts and find the implements for the labourers' use. How could hands alone repair a bridge which had rotted away? To cut a log of wood for the public service would have necessitated communications with the Inspection of Woods and Forests and other centres and many months' delay.

The system of controlling the action of one public servant by appointing another under him to supervise his work has always found favour in Spain, and was adopted in this Colony. There were a great many Government employments of the kind which were merely sinecures. In many cases the pay was small, it is true, but the labour was often of proportionately smaller value than that pay. With very few exceptions, all the Government Offices in Manila were closed to the public during half the ordinary working-day,--the afternoon,--and many of the Civil Service officials made their appearance at their desks about ten o'clock in the morning, retiring shortly after mid-day, when they had smoked their habitual number of cigarettes.

The crowd of office-seekers were indifferent to the fact that the true source of national vigour is the spirit of individual self-dependence. Constant clamour for Government employment tends only to enfeeble individual effort, and destroys the stimulus, or what is of greater worth, the necessity of acting for one's self. The Spaniard (except the Basque and the Catalonian) looks to the Government for active and direct aid, as if the Public Treasury were a natural spring at the waters of which all temporal calamities could be washed away--all material wants supplied. He will tell you with pride rather than with abashment that he is an empleado--a State dependent.

National progress is but the aggregate of personal individual activity rightly directed, and a nation weakens as a whole as its component parts become dormant, or as the majority rely upon the efforts of the few. The spirit of Caesarism--"all for the people and nothing by them"--must tend not only to political slavery, but to a reduction in commercial prosperity, national power, and international influence. The Spaniards have indeed proved this fact. The best laws were never intended to provide for the people, but to regulate the conditions on which they could provide for themselves. The consumers of public wealth in Spain are far too numerous in proportion to the producers; hence not only is the State constantly pressed for funds, but the busy bees who form the nucleus of the nation's vitality are heavily taxed to provide for the dependent office-seeking drones. It is the fatal delusion that liberty and national welfare depend solely upon good government, instead of good government depending upon united and co-operative individual exertion, that has brought the Spanish nation to its present state of deplorable impotence.

The Government itself is but the official counterpart of the governed. By the aid of servile speculators, a man in political circles struggles to come to the front--to hold a portfolio in the ministry--if it only be for a session, when his pension for life is assured on his retirement. Merit and ability have little weight, and the proteges of the outgoing minister must make room for those of the next lucky ministerial pension-seeker, and so on successively. This Colony therefore became a lucrative hunting-ground at the disposal of the Madrid Cabinet wherein to satisfy the craving demands of their numerous partisans and friends. They were sent out with a salary and to make what they could,--at their own risk, of course,--like the country lad who was sent up to London with the injunction from his father, "Make money, honestly if you can, but make it."

From the Conquest up to 1844, when trading by officials was abolished, it was a matter of little public concern how Government servants made fortunes. Only when the jealousy of one urged him to denounce another was any inquiry instituted so long as the official was careful not to embezzle or commit a direct fraud on the Real Haber (the Treasury funds). When the Real Haber was once covered, then all that could be got out of the Colony was for the benefit of the officials, great and small. In 1840, Eusebio Mazorca wrote as follows: [104]--"Each chief of a province is a real sultan, and when he has terminated his administration, all that is talked of in the capital is the thousands of pesos clear gain which he made in his Government."

Eusebio Mazorca further states: [105]--"The Governor receives payment of the tribute in rice-paddy, which he credits to the native at two reales in silver per caban. Then he pays this sum into the Royal Treasury in money, and sells the rice-paddy for private account at the current rate of six, eight or more reales in silver per caban, and this simple operation brings him 200 to 300 per cent. profit."

The same writer adds:--"Now quite recently the Interventor of Zamboanga is accused by the Governor of that place of having made some P15,000 to P16,000 solely by using false measures ... The same Interventor to whom I refer, is said to have made a fortune of P50,000 to P60,000, whilst his salary as second official in the Audit Department [106] is P540 per annum." According to Zuniga, the salary of a professor of law with the rank of magistrate was P800 per annum.

Up to June, 1886, the provincial taxes being in the custody of the Administrator, the Judicial Governor had a percentage assigned to him to induce him to control the Administrator's work. The Administrator himself had percentages, and the accounts of these two functionaries were checked by a third individual styled the "Interventor," whose duties appeared to be to intervene in the casting-up of his superiors' figures. He was forbidden to reside with the Administrator. After the above date the payment of all these percentages ceased.

But for the peculations by Government officials from the highest circles downwards, the inhabitants of the Colony would doubtless have been a million or so richer per annum. One frequently heard of officials leaving for Spain with sums far exceeding the total emoluments they had received during their term of office. Some provincial employees acquired a pernicious habit of annexing what was not theirs by all manner of pretexts. To cite some instances: I knew a Governor of Negros Island who seldom saw a native pass the Government House with a good horse without begging it of him; thus, under fear of his avenging a refusal, his subjects furnished him little by little with a large stud, which he sold before he left, much to their disgust.

In another provincial capital there happened to be a native headman imprudently vain enough to carry a walking-stick with a chased gold-knob handle studded with brilliants. It took the fancy of the Spanish Governor, who repeatedly expressed his admiration of it, hoping that the headman would make him a present of it. At length, when the Governor was relieved of his post, he called together the headmen to take formal leave of them, and at the close of a flattering speech, he said he would willingly hand over his official-stick as a remembrance of his command. In the hubbub of applause which followed, he added, "and I will retain a souvenir of my loyal subordinates." Suiting the action to the word, he snatched the coveted stick out of the hand of the owner and kept it. A Gov.-General in my time enriched himself by peculation to such an extent that he was at his wits' end to know how to remit his ill-gotten gains clandestinely. Finally, he resolved to send an army Captain over to Hong-Kong with P35,000 to purchase a draft on Europe for him. The Captain went there, but he never returned.

There were about 725 towns and 23 missions in the Colony. Each town was locally governed by a native--in some cases a Spanish or Chinese half-caste--who was styled the petty-governor or Gobernadorcillo, whilst his popular title was that of Capitan. This service was compulsory. The elections of Gobernadorcillos and their subordinates took place every two years, the term of office counting from the July 1 following such elections. In the few towns where the Gobernadorcillos were able to make considerable sums, the appointment was eagerly sought for, but as a rule it was considered an onerous task, and I know several who have paid bribes to the officials to rid them of it, under the pretext of ill-health, legal incapacity, and so on. The Gobernadorcillo was supported by what was pompously termed a "ministry," composed of two lieutenants of the town, lieutenants of the wards, the chiefs of police, of plantations, and of live-stock.

The Gobernadorcillo was nominally the delegate and practically the servant of his immediate chief, the Provincial Governor. He was the arbiter of local petty questions, and endeavoured to adjust them, but when they assumed a legal aspect, they were remitted to the local Justice of the Peace, who was directly subordinate to the Provincial Chief Judge. He was also responsible to the Administrator for the collection of taxes--to the Chief of the Civil Guard for the capture of criminals, and to the priest of his parish for the interests of the Church. His responsibility for the taxes to be collected sometimes brought him imprisonment, unless he succeeded in throwing the burden on the actual collectors--the Cabezas de Barangay.

The Gobernadorcillo was often put to considerable expense in the course of his two years, in entertaining and supplying the wants of officials passing through. To cover this outlay, the loss of his own time, the salaries of writers in the Town Hall, presents to his Spanish chiefs to secure their goodwill, and other calls upon his private income, he naturally had to exact funds from the townspeople. Legally, he could receive, if he chose (but few did), the munificent salary of P2 per month, and an allowance for clerks equal to about one-fifth of what he had to pay them. Some of these Gobernadorcillos were well-to-do planters, and were anxious for the office, even if it cost them money, on account of the local prestige which the title of "Capitan" gave them, but others were often so poor that if they had not pilfered, this compulsory service would have ruined them. However, a smart Gobernadorcillo was rarely out of pocket by his service. One of the greatest hardships of his office was that he often had to abandon his plantation or other livelihood to go to the provincial capital at his own expense whenever he was cited there. Many of them who did not speak or understand Spanish had to pay and be at the mercy of a Secretary (Directorcillo), who was also a native.

When any question arose of general interest to the townspeople (such as a serious innovation in the existing law, or the annual feasts, or the anticipated arrival of a very big official, etc.) the headmen (principalia) were cited to the Town Hall. They were also expected to assemble there every Sunday and Great Feast Days (three-cross Saint days in the Calendar), to march thence in procession to the church to hear Mass, under certain penalties if they failed to attend. Each one carried his stick of authority; and the official dress was a short Eton jacket of black cloth over the shirt, the tail of which hung outside the trousers. Some Gobernadorcillos, imbued with a sense of the importance and solemnity of office, ordered a band to play lively dance music at the head of the cortege to and from the church. After Mass they repaired to the convent, and on bended knee kissed the priest's hand. Town affairs were then discussed. Some present were chided, others were commended by their spiritual dictator.

In nearly every town the people were, and still are, divided into parties holding divergent views on town affairs, each group being ready to give the other a "stab in the back" when the opportunity offers, and not unfrequently these differences seriously affect the social relations of the individual members.

For the direct collection of taxes each township was sub-divided into groups of forty or fifty families called Barangays: each group had to pay taxes to its respective head, styled Cabeza de Barangay, who was responsible to the petty-governor, who in turn made the payment to the Provincial Administrator for remission to the Treasury (Intendencia) in Manila. This Barangay chiefdom system took its origin from that established by the natives themselves prior to the Spanish conquest, and in some parts of the Colony the original title of datto was still applied to the chief. This position, hereditary among themselves, continued to be so for many years under Spanish rule, and was then considered an honourable distinction because it gave the heads of certain families a birthright importance in their class. Later on they were chosen, like all the other native local authorities, every two years, but if they had anything to lose, they were invariably re-elected. In order to be ranked among the headmen of the town (the principalia), a Barangay chief had to serve for ten years in that capacity unless he were, meanwhile, elected to a higher rank, such as lieutenant or gobernadorcillo. Everybody, therefore, shirked the repugnant obligations of a chiefdom, for the Government rarely recognized any bad debts in the collection of the taxes, until the chief had been made bankrupt and his goods and chattels sold to make good the sums which he could not collect from his group, whether it arose from their poverty, death, or from their having absconded. I have been present at auction sales of live-stock seized to supply taxes to the Government, which admitted no excuses or explanations. Many Barangay chiefs went to prison through their inability or refusal to pay others' debts. On the other hand, there were among them some profligate characters who misappropriated the collected taxes, but the Government had really little right to complain, for the labour of tax-gathering was a forced service without remuneration for expenses or loss of time incurred.

In many towns, villages, and hamlets there were posts of the Civil Guard established for the arrest of criminals and the maintenance of public order; moreover, there was in each town a body of guards called Cuadrilleros for the defence of the town and the apprehension of bandits and criminals within the jurisdiction of the town only. The town and the wards together furnished these local guards, whose social position was one of the humblest and least enviable. There were frequent cases of Cuadrilleros passing over to a band of brigands. Some years ago the whole muster belonging to the town of Mauban (Tayabas) suddenly took to the mountains; on the other hand, many often rendered valuable aid to society, but their doubtful reliability vastly diminished their public utility.

From the time Philippine administration was first organized up to the year 1884, all the subdued natives paid tribute. Latterly it was fixed at one peso and ten cents per annum, and those who did not choose to work for the Government during forty days in the year, paid also a poll-tax (fallas) of P3 per annum. But, as a matter of fact, thousands were declared as workers who never did work, and whilst roads were in an abominable condition and public works abandoned, not much secret was made of the fact that a great portion of the poll-tax never reached the Treasury. These pilferings were known to the Spanish local authorities as caidas or droppings; and in a certain province I met at table a provincial chief judge, the nephew of a general, and other persons who openly discussed the value of the different Provincial Governments (before 1884) in Luzon Island, on the basis of so much for salary and so much for fees and caidas.

However, although the tribute and fallas system worked as well as any other would under the circumstances, for some reason, best known to the authorities, it was abolished. In lieu thereof a scheme was proposed, obliging every civilized inhabitant of the Philippines, excepting only public servants, the clergy, and a few others, to work for fifteen days per annum without the right of redeeming this obligation by payment. Indeed, the decree to that effect was actually received in Manila from the Home Government, but it was so palpably ludicrous that the Gov.-General did not give it effect. He had sufficient common sense to foresee in its application the extinction of all European prestige and moral influence over the natives if Spanish and foreign gentlemen of good family were seen sweeping the streets, lighting the lamps, road-mending, guiding buffalo-carts loaded with stones, and so on. This measure, therefore, regarded by some as a practical joke, by others as the conception of a lunatic theorist--was withdrawn, or at least allowed to lapse.

Nevertheless, those in power were bent on reform, and the Peninsular system of a document of identity (Cedula personal), which works well amongst Europeans, was then adopted for all civilized classes and nationalities above the age of 18 years without exception, its possession being compulsory. The amount paid for this document, which was of nine classes, [107] from P25 value downwards, varied according to the income of the holder or the cost of his trading-licences. Any person holding this document of a value under P3 1/2 was subject to fifteen days' forced labour per annum, or to pay 50 cents for each day he failed to work. The holder of a document of P3 1/2 or over paid also P1 1/2 "Municipal Tax" in lieu of labour. The "Cedula" thenceforth served as a passport for travelling within the Archipelago, to be exhibited at any time on demand by the proper authority. No legal document was valid unless the interested parties had produced their Cedulas, the details of which were inscribed in the legal instrument. No petitions would be noticed, and very few transactions could be made in the Government offices without the presentation of this identification document. The decree relating to this reform, like most ambiguous Spanish edicts, set forth that any person was at liberty to take a higher-valued Cedula than that corresponding to his position, without the right of any official to ask the reason why. This clause was prejudicial to the public welfare, because it enabled thousands of able-bodied natives to evade labour for public improvements of imperative necessity in the provinces. The public labour question was indeed altogether a farce, and simply afforded a pretext for levying a tax.

It would appear that whilst the total amount of taxation in Spanish times was not burdensome, the fiscal system was obviously defective.

The (American) Insular Government has continued the issue of the Cedula on a reasonable plan which bears hard on no one. Forced labour is abolished; government work is paid for out of the taxes; and the uniform cost of the Cedula is one peso for every male between the ages of 18 and 60 years.

In 1890 certain reforms were introduced into the townships, most of which were raised to the dignity of Municipalities. The titles of Gobernadorcillo and Directorcillo (the words themselves in Spanish bear a sound of contempt) were changed to Capitan Municipal and Secretario respectively (Municipal Captain and Secretary) with nominally extended powers. For instance, the Municipal Captains were empowered to disburse for public works, without appeal to Manila, a few hundred pesos in the year (to be drawn, in some cases, from empty public coffers, or private purses). The functions of the local Justices of the Peace were amplified and abused to such a degree that these officials became more the originators of strife than the guardians of peace. The old-established obligation to supply travellers, on payment therefor, with certain necessaries of life and means of transport was abolished.

Hitherto it had been the custom for a traveller on arriving at a town without knowing any one there, or without letters of introduction, to alight (by right) at the Tribunal, or Town Hall. Each such establishment had, or ought to have had, a tariff of necessary provisions and the means of travelling to the next town (such as ponies, gigs, hammocks, sedan-chairs, etc., according to the particular conditions of the locality). Each Barangay or Cabezeria furnished one Cuadrillero (vide pp. 223, 224) for the service of the Tribunal, so that the supply of baggage-carriers, bearers, etc., which one needed could not be refused on payment. The native official in charge of this service to travellers, and in control of the Cuadrilleros, was styled the Alguacil. Hence the Tribunal served the double purpose of Town Hall and casual ward for wayfarers. There were all sorts of Tribunales, from the well-built stone and wood house to the poverty-stricken bamboo shanty where one had to pass the night on the floor or on the table.

By decree of Gov.-General Weyler (1888-91) dated October 17, 1888, which came into force on January 1, 1889, the obligation of the Tribunal officials to supply provisions to travelling civilians had been already abolished, although, under both reforms, civilians could continue to take refuge at the Tribunal as theretofore. Notwithstanding the reform of 1890, until the American advent the European traveller found it no more difficult than before to procure en route the requisite means for provincial travelling.

XIV. Spanish-Philippine Finances

The secession of Mexico from the Spanish Crown in the second decade of last century brought with it a complete revolution in Philippine affairs. Direct trade with Europe through one channel or another had necessarily to be permitted. The "Situado," or subsidy (vide p. 244), received from Mexico became a thing of the past, and necessity urged the home authorities to relax, to a certain extent, the old restraint on the development of Philippine resources.

In 1839 the first Philippine Budget was presented in the Spanish Cortes, but so little interest did the affairs of the Colony excite that it provoked no discussion. After the amendment of only one item the Budget was adopted in silence. It was not the practice in the earliest years to publish the full Philippine Budget in the Islands, although allusion was necessarily made to items of it in the Gaceta de Manila. However, it could be seen without difficulty in Madrid. Considering that the Filipinos had no political rights, except for the very brief period alluded to in Chapter xxii. (vide Cortes de Cadiz), it is evident that popular discussion of public finance would have been undesirable, because it could have led to no practical issue.

There is apparently no record of the Philippine Islands having been at any time in a flourishing financial condition. With few exceptions, in latter years the collected revenue of the Colony was usually much less than the estimated yield of taxes. The Budget for 1888 is here given in detail as an example.

PHILIPPINE BUDGETS

Financial Estimated Income Difference. Year. Income. Realized. P P P 1884-85 11,298,508.98 9,893,745.87 1,404,763.11 1885-86 11,528,178.00 9,688,029.70 1,840,148.30 1886-87 11,554,379.00 9,324,974.08 2,229,404.92 1894-95 13,280,139.40 13,579,900.00 299,760.60 1896-97 17,086,423.00 17,474,000.00 387,577.00

ANTICIPATED REVENUE, YEAR 1888

P cts.

Direct Taxes 5,206,836 93

Customs Dues 2,023,400 00

Government Monopolies (stamps, cock-fighting, opium, gambling, etc.) 1,181,239 00 Lotteries and Raffles 513,200 00 Sale of State property 153,571 00 War and Marine Department (sale of useless articles. Gain on repairs to private ships in the Government Arsenal) 15,150 00 Sundries 744,500 00

9,837,896 93

Anticipated Expenditure, year 1888 9,825,633 29

Anticipated Surplus P 12,263 64

The actual deficit in the last previous Budget for which there was no provision was estimated at P1,376,179.56, against which the above balance would be placed. There were some remarkable inconsistencies in the 1888 Budget. The Inspection of Woods and Forests was an institution under a Chief Inspector with a salary of P6,500, assisted by a technical staff of 64 persons and 52 non-technical subordinates. The total cost for the year was estimated at P165,960, against which the expected income derived from duties on felled timber was P80,000; hence a loss of P85,960 was duly anticipated to satisfy office-seekers. Those who wished to cut timber were subjected to very complicated and vexatious regulations. The tariff of duties and mode of calculating it were capriciously modified from time to time on no commercial basis whatever. Merchants who had contracted to supply timber at so much per foot for delivery within a fixed period were never sure of their profits; for the dues might, meanwhile, be raised without any consideration for trading interests. The most urgent material want of the Colony was easy means of communication with the interior of the Islands. Yet, whilst this was so sadly neglected, the Budget provided the sum of P113,686.64 for a School of Agriculture in Manila and 10 model farms and Schools of Cultivation in the provinces. It was not the want of farming knowledge, but the scarcity of capital and the scandalous neglect of public highways and bridges for transport of produce which retarded agriculture. The 113,000 pesos, if disbursed on roads, bridges, town halls, and landing-jetties, would have benefited the Colony; as it was, this sum went to furnish salaries to needy Spaniards.

The following are some of the most interesting items of the Budget:

CURIOUS ITEMS OF REVENUE

P cts.

2,760,613 Identification Documents (Cedulas personales), costing 4 per cent, to collect--gross value 4,401,629 25 Tax on the above, based on the estimated local consumption of Tobacco 222,500 00 Chinese Capitation Tax 236,250 00 Tax on the above for the estimated local consumption of Tobacco 11,250 00 Recognition of vassalage collected from the unsubdued mountain tribes 12,000 00 Industrial and Trading Licences (costing 1/2 per cent, to collect), gross value 1,350,000 00 Yield of the Opium Contract (farmed out) 483,400 00 Yield of the Cock-fighting Contract (farmed out) 149,039 00 Lotteries and Raffles, nett profit say 501,862 00 State Lands worked by miners 100 00 Sale of State Lands 50,000 00 Mint--Profits on the manipulation of the bullion, less expenses of the Mint (P 46,150), nett 330,350 00 Stamps and Stamped Paper 548,400 00 Convict labour hired out 50,000 00

CURIOUS ITEMS OF EXPENDITURE

P cts. 34 per cent, of the maintenance of Fernando Po (by Decree of August 5, 1884) 68,618 18 Share of the pension paid to the heir of Christopher Columbus, the Duke de Veragua (P 23,400 a year) 3,000 00 Share of the pension paid to Ferdinand Columbus, Marquis de Barboles 1,000 00 The Marquis de Bedmar is the heir of the assayer and caster in the Mint of Potosi (Peru). The concern was taken over by the Spanish Government, in return for an annual perpetual pension, of which this Colony contributed the sum of 1,500 00 The Consular and Diplomatic Services, Philippine Share 66,000 00 Postal and Telegraph Services (staff of 550 persons) 406,547 17 The Submarine Cable Co. Subsidy (Bolinao to Hong-Kong) 48,000 00 Charitable Institutions partly supported by Government, including the "Lepers' Hospital" P500 26,887 50

THE ARMY AND ARMED LAND FORCES

Rank and File and Non-commissioned Officers as follows:--

Infantry, Artillery, Engineer, and Carabineer Corps 9,470 Cavalry Corps 407 Disciplinary Corps (Convicts) 630 Disciplinary Corps (Non-commissioned Officers) 92 Three Civil Guard Corps (Provincial Constabulary) 3,342 Veteran Civil Guard Corps (Manila Military Police) 400

Total number of men 14,341

ARMY OFFICERS IN THE PHILIPPINES.

Year 1888.

How Employed. Lieutenant-Generals. | Brigadier-Generals. | | Colonels. | | | Lieutenant-Colonels. | | | | Majors. | | | | | Captains. | | | | | | Lieutenants. | | | | | | | Sub-Lieutenants. | | | | | | | | Totals. | | | | | | | | |

Governor-General, with local rank of Captain-General 1 1 Employed in Government Administration, Political Military Provincial Governments, Staff Officers and Officers at the Orders of the Governor-General 1 7 7 14 39 37 23 12 140 With command or attached to Army Corps and Disciplinary Corps 5 11 14 88 136 127 381 Civil Guard 3 3 9 33 54 54 156 Veteran Civil Guard 1 6 6 13 Invalid Corps 1 1 Military Academy 1 1 2 4 Prisons and Penitentiaries 1 1 4 3 9 Commissariat Department 1 1 1 14 18 35 Judicial Audit Department 1 1 2 2 6 In expectation of service 1 3 6 12 12 12 46 In excess of Active Service requirements 3 1 7 9 20 Total of Officers 2 9 19 36 73 191 262 220 812

The Archbishop, as Vicar-General of the Armed Forces, ranked in precedence as a Field-Marshal. (In the Spanish Army a Field-Marshal ranks between a Brig.-General and Lieut.-General.)

OFFICERS' PAY PER ANNUM

Rank. Ordinary Pay. | When Commanding a Corps. Extra. | | When in Civil Guard. | | | When in Veteran | | | Civil Guard. | | | | P P P P Captain-General was paid as Governor-General of the Colony 40,000 [108] Lieutenant-General (local rank), Sub- Inspector of Army Corps 12,000 Brigadier-General 4,500 800 Colonel 3,450 600 4,200 Lieutenant-Colonel 2,700 400 3,288 Major 2,400 2,520 2,880 Captain 1,500 1,584 Lieutenant 1,125 1,242 1,485 Sub-Lieutenant 975 1,068 1,275

After 6 years' and up to 9 years' service, an officer could claim a free passage back to the Peninsula for himself and, if married, his family.

After 9 years' service, his retirement from the Colony for three years was compulsory. If he nevertheless wished to remain in the Colony, he must quit military service. If he left before completing six years' service, he would have to pay his own passage unless he went "on commission" or with sick-leave allowance.

Estimated Annual Disbursements for--

P cts

The Civil Guard (Constabulary), composed of Three Corps = 3,342 Men and 156 Officers 638,896 77 The Veteran Civil Guard (Manila Police) One Corps = 400 Men and 13 Officers 73,246 88 ---------- The Disciplinary Corps, Maintenance of 630 Convicts and Material 56,230 63 (For the Disciplinary Convict Corps) 92 Non-commissioned Officers and 23 Officers 47,909 51 ========== P 104,140 14

Army Estimates

P cts

Estimate according to the Budget for 1888 Plus the following sums charged on other estimates, viz.:-- 3,016,185 91 Disciplinary Corps, maintenance of 630 Convicts and material 56,230 63 The Civil Guard 638,896 77 The Veteran Civil Guard 73,246 88 Pensions 117,200 00 Transport and maintenance of Recruits from Provinces 6,000 00 Expeditions to be made against the Moros--Religious ceremonies to celebrate Victories gained over them--Maintenance of War Prisoners, etc. 11,000 00 ============ Total cost of Army and Armed Land Forces P 3,918,760 19

Before the walls were built around Manila, about the year 1590, each soldier and officer lived where he pleased, and, when required, the troops were assembled by the bugle call.

At the close of the 16th century barracks were constructed, but up to the middle of last century the native troops were so badly and irregularly paid that they went from house to house begging alms of the citizens (vide p. 53, King Philip II.'s Decree).

In the 17th century troops died of sheer want in the Fort of Yligan (Mindanao Is.), and when this was represented to the Gov.-General he generously ordered that the Spanish soldiers were in future to be paid P2 per month and native soldiers P1 per month to hold the fort, at the risk of their lives, against attack from the Mahometans.

In the forts of Labo and Taytay (Palauan Is.) the soldiers' pay was only nominal, rations were often short, and their lives altogether most wretched. Sometimes they were totally overlooked by the military chiefs, and they had to seek subsistence as best they could when provisions were not sent from the capital (_vide_p. 157).

Mexican soldiers arrived in nearly every ship, but there were no barracks for them, no regular mode of living, no regulations for their board and lodging, etc.; hence many had to subsist by serving natives and half-breeds, much to the discredit of the mother country, and consequent loss of prestige. Each time a new expedition was organized a fresh recruiting had to be made at great cost and with great delay. There was practically no regular army except those necessarily compelled to mount guard, etc., in the city. Even the officers received no regular pay until 1754, and there was some excuse for stealing when they had a chance, and for the total absence of enthusiasm in the Service. When troops were urgently called for, the Gov.-General had to bargain with the officers to fill the minor posts by promises of rewards, whilst the high commands were eagerly sought for, not for the pay or the glory, but for the plunder in perspective.

In 1739 the Armoury in Manila contained only 25 Arquebuses of native make, 120 Biscayan muskets, 40 Flint guns, 70 Hatchets, and 40 Cutlasses.

The first regular military organization in these Islands was in the time of Governor Pedro Manuel de Arandia (1754), when one regiment was formed of five companies of native soldiers, together with four companies of troops which arrived with the Governor from Mexico. This corps, afterwards known as the "King's Regiment" [109] (Regimiento del Rey) was divided into two battalions, increased to 10 companies each as the troops returned from the provinces.

The 20 companies were each composed as follows:--

1 captain, 1 lieutenant, 1 sub-lieutenant, 4 sergeants, 2 drummers, 6 first corporals, 6 seconds corporals, and 88 rank and file.

The Gov.-General's Body Guard of Halberdiers was reformed, and thenceforth consisted of 18 men, under a captain and a corporal.

The Monthly Pay under these reforms was as follows:--

Staff Officers. Regimental Officers Governor-General's P. and Staff P. c. Body Guard P.

Chief of the Staff 40 Captain 25 00 Captain 35 Adjutant-Major. 25 Lieutenant. 18 00 Corporal 10 Adjutant. 18 Sub-Lieutenant. 14 00 Guards 5 Captain 12 Sergeant 4 00 Drummer 3 00 First Corporal 3 25 Second Corporal 3 00 Rank and File 2 62 1/2

From October 1, 1754, the troops were quartered in barracks, Commissariat Officers were appointed, and every man and every officer was regularly paid fortnightly. The soldiers were not used to this discipline, and desertion was frequent. They much preferred the old style of roaming about to beg or steal and live where they chose until they were called out to service, and very vigorous measures had to be adopted to compel them to comply with the new regulations.

In May, 1755, four artillery brigades were formed, the commanding officer of each receiving P30 per month pay.

In 1757 there were 16 fortified provincial outposts, at a total estimated cost of P37,638 per annum (including Zamboanga, the chief centre of operations against the Mahometans, which alone cost P18,831 in 1757), besides the armed forces and Camp of Manila, Fort Santiago, and Cavite Arsenal and Fort, which together cost a further sum of P157,934 for maintenance in that year.

SPANISH VESSELS IN PHILIPPINE WATERS

Year 1898

Name. Class. Tons. H.P.

Reina Cristina Cruiser 3,500 3,950 Castilla Cruiser 3,260 4,400 Don Anto. de Ulloa Cruiser 1,200 1,523 Don Juan de Austria Cruiser 1,130 1,600 Isla de Cuba Cruiser 1,048 2,200 Isla de Luzon Cruiser 1,048 2,200 Velasco Gunboat 1,152 1,500 Elcano Gunboat 560 600 General Lezo Gunboat 520 600 Argos Gunboat 508 600 Marques del Duero Gunboat 500 550 Manila Transport 1,900 750 General Alava Transport 1,200 1,000 Cebu Transport 532 600 Callao Gunboat, and 4 others very small, besides 3 armed steam launches built in Hong-Kong, viz.:--Lanao, Corcuera, and General Blanco.

NAVAL DIVISIONS

Station. Commander's Pay. P

South Division 5,760 Palauan (Pta. Princesa) 4,560 Isabel de Basilan 3,360 Balabac Island 3,360 Corregidor Island 3,360 West Caroline Islands 3,360 East Caroline Islands 4,560

HARBOUR-MASTERS

Station. Pay. Station. Pay. P P Manila 3,200 Pangasinan 1,500 Yloilo 3,200 Ilocos Norte y Sur. 1,500 Cebu 1,500 Cagayan 1,500 Capis 1,500 Ladrone Islands 1,500 Zamboanga 1,500 Laguimanoc (Civilian) 144

The Chief of the Philippine Naval Forces was a Rear-Admiral receiving P16,392 per annum.

There were two Brigades of Marine Infantry, composed of 376 men with 18 officers.

Cavite Arsenal

The chief Naval Station was at Cavite, six miles from Manila. The forces at this station were 90 Marines as Guards, and 244 Marines as reserves. One hundred convicts were employed for Arsenal labour.

The Officer in command of the Cavite Arsenal and Naval Station took rank after the Rear-Admiral, and received a salary of P8,496 per annum.

The Navy Estimates (Budget for 1888) amounted to P2,573,776.27.

Spanish Judicial Statistics

Civil and Criminal Law Courts

The Civil and Criminal Law Courts were as follows, viz.:--

2 Supreme Courts in Manila and Cebu, quite independent of each other. 4 First-Class Courts of Justice in Manila (called "de termino.") 8 First-Class Courts of Justice in the Provinces (called "de termino_.") 10 Second-Class Courts of Justice in the Provinces (called "de ascenso.") 19 Third-Class Courts of Justice in the Provinces (called "de entrada.") 7 Provincial Governments with judicial powers.

Judges' Salaries

President of the Supreme Court of Manila P7,000 President of the Supreme Court of Cebu 6,000 Judge of each of the 12 First-Class Courts 4,000 Judge of each of the 10 Second-Class Courts 3,000 Judge of each of the 19 Third-Class Courts 2,000

Law Courts Estimate for 1888

P cts.

Supreme Court of Manila 90,382 00 Supreme Court of Cebu 49,828 00 All the minor Courts and allowances to Provincial Governors with judicial powers 192,656 00 ------- -- Estimated total cost for the year P332,866 00

Penitentiaries and Convict Settlements

Manila (Bilibid Jail) containing on an average 900 Native Convicts And in 1888 there were also 3 Spanish Convicts Cavite Jail contained in 1888 51 Native Convicts Zamboanga Jail contained in 1888 98 Native Convicts Agricultural Colony of San Ramon (Zamboanga), worked by convict labour, contained in 1888 164 Native Convicts Ladrone Island Penal Settlement contained in 1888 101 Native Convicts Ladrone Island Penal Settlement contained in 1888 3 Spanish Convicts In the Army and Navy Services 730 Native Convicts ----- 2,045 Convicts

Total estimated disbursements for Penitentiaries and Convict maintenance in the Settlements for the year P82,672.71

Brigandage first came into prominence in Governor Arandia's time (1754-59), and he used the means of "setting a thief to catch a thief," which answered well for a short time, until the crime became more and more habitual as provincial property increased in value and capital was accumulated there. In 1888 the Budget provided an allowance of 2,000 pesos for rewards for the capture or slaughter of these ruffians. Up to the end of Spanish rule, brigandage, pillage, and murder were treated with such leniency by the judges that there was little hope for the extinction of such crimes. When a band of thieves and assassins attacked a village or a residence, murdered its inhabitants, and carried off booty, the Civil Guard at once scoured the country, and often the malefactors were arrested. The Civil Guard was an excellent institution, and performed its duty admirably well; but as soon as the villains were handed over to the legal functionaries, society lost hope. Instead of the convicted criminals being garrotted according to law, as the public had a right to demand, they were "protected"; some were let loose on the world again, whilst others were sent to prison and allowed to escape, or they were transported to a penal settlement to work without fetters, where they were just as comfortable as if they were working for a private employer. I record these facts from personal knowledge, for my wanderings in the Islands brought me into contact with all sorts and conditions of men. I have been personally acquainted with many brigands, and I gave regular employment to an ex-bandit for years.

The Philippine brigand--known in the northern islands as Tulisan and in the southern islands as Pulajan--is not merely an outlaw, such as may yet be found in Southern and Eastern Europe; his infamous work of freebooting is never done to his satisfaction without the complement of bloodshed, even though his victim yield to him all without demur. Booty or no booty, blood must flow, if he be the ordinary Tulisan of the type known to the Tagalogs as dugong-aso (blood of a dog). as distinguished from the milder Tulisan pulpul (literally, the blunt brigand), who robs, uses no unnecessary violence, but runs away if he can, and only fights when he must.

At Christmas, 1884, I went to Laguimanoc in the Province of Tayabas to spend a few days with an English friend of mine. [110] On the way there, at Sariaya, I stayed at the house of the Captain of the Civil Guard, when a message came to say that an attack had been made the night before on my friend's house, his manager, a Swede, having been killed, and many others in the village wounded. The Captain showed me the despatch, and invited me to join him as a volunteer to hunt down the murderers. I agreed, and within half an hour we were mounted and on their track all through that dark night, whilst the rain poured in torrents. Four native soldiers were following us on foot. We jumped over ditches, through rice-paddy fields and cocoanut plantations, and then forded a river, on the opposite bank of which was the next guards' post in charge of a lieutenant, who joined us with eight foot-soldiers. That same night we together captured five of the wretches, who had just beached a canoe containing part of their spoils. The prisoners were bound elbows together at their backs and sent forward under escort. We rode on all night until five o'clock the next morning, arriving at the convent of Pagbilao just as Father Jesus was going down to say Mass. I had almost lost my voice through being ten hours in the rain; but the priest was very attentive to us, and we went on in a prahu to the village where the crime had been committed. In another prahu the prisoners were sent in charge of the soldiers. In the meantime, the Chief Judge and the Government Doctor of the province had gone on before us. On the way we met a canoe going to Pagbilao, carrying the corpse of the murdered Swede for burial. When we arrived at Laguimanoc, we found one native dead and many natives and Chinese badly wounded.

My friend's house had the front door smashed in--an iron strong-box had been forced, and a few hundred pesos, with some rare coins, were stolen. The furniture in the dining-room was wantonly hacked about with bowie-knives, only to satisfy a savage love for mischief. His bedroom had been entered, and there the brigands began to make their harvest; the bundles of wearing-apparel, jewellery, and other valuables were already tied up, when lo! the Virgin herself appeared, casting a penetrating glance of disapproval upon the wicked revelry! Forsaking their plunder, the brigands fled in terror from the saintly apparition. And when my friend re-entered his home and crossed the bloodstained floor of the dining-room to go to his bedroom, the cardboard Virgin, with a trade advertisement on the back, was still peeping round the door-jamb to which she was nailed, with the words "Please to shut the door" printed on her spotless bust.

The next day the Captain remained in the village whilst I went on with the Lieutenant and a few guards in a prahu down the coast, where we made further captures, and returned in three days. During our journey in the prahu the wind was so strong that we resolved to beach our craft on the seashore instead of attempting to get over the shoal of the San Juan River. We ran her ashore under full sail, and just at that moment a native rushed towards us with an iron bar in his hand. In the evening gloom he must have mistaken us for a party of weather-beaten native or Chinese traders whose skulls he might smash in at a stroke and rifle their baggage. He halted, however, perfectly amazed when two guards with their bayonets fixed jumped forward in front of him. Then we got out, took him prisoner, and the next day he was let off with a souvenir of the lash, as there was nothing to prove that he was a brigand by profession. The second leader of the brigand gang was shot through the lungs a week afterwards, by the guards who were on his track, as he was jumping from the window-opening of a hut, and there he died.

The Captain of the Civil Guard received an anonymous letter stating where the brigand chief was hiding. This fact came to the knowledge of the native cuadrillero officer who had hitherto supplied his friend, the brigand, with rice daily, so he hastened on before the Captain could arrive, and imposed silence for ever on the fugitive bandit by stabbing him in the back. Thus the cuadrillero avoided the disclosure of unpleasant facts which would have implicated himself. The prisoners were conducted to the provincial jail, and three years afterwards, when I made inquiries about them, I learnt that two of them had died of their wounds, whilst not a single one had been sentenced.

The most ignorant classes believe that certain persons are possessed of a mystic power called anting-anting, which preserves them from all harm, and that the body of a man so affected is even refractory to bullet or steel. Brigands are often captured wearing medallions of the Virgin Mary or the Saints as a device of the anting-anting. In Maragondon (Cavite), the son of a friend of mine was enabled to go into any remote place with impunity, because he was reputed to be possessed of this charm. Some highwaymen, too, have a curious notion that they can escape punishment for a crime committed in Easter Week, because the thief on the cross was pardoned his sins.

In 1885 I purchased a small estate, where there was some good wild-boar hunting and snipe-shooting, and I had occasion to see the man who was tenant previous to my purchase, in Manila Jail. He was accused of having been concerned in an attack upon the town of Mariquina, and was incarcerated for eighteen months without being definitely convicted or acquitted. Three months after his release from prison he was appointed petty-governor of his own town, much to the disgust of the people, who in vain petitioned against it in writing.

I visited the Penal Settlement, known as the Agricultural Colony of San Ramon, situated about fifteen miles north of Zamboanga, where I remained twelve days. The director of the settlement was D. Felipe Dujiols, an army captain who had defended Onate (in Guipuzcoa, Spain), during the Carlist war; so, as we were each able to relate our personal experiences of that stirring period, we speedily became friends. As his guest, I was able to acquire more ample information about the system of convict treatment. With the 25 convicts just arrived, there were in all 150 natives of the most desperate class--assassins, thieves, conspirators, etc., working on this penal settlement. They were well fed, fairly well lodged, and worked with almost the same freedom as independent labourers. Within a few yards of the director's bungalow were the barracks, for the accommodation of a detachment of 40 soldiers--under the command of a lieutenant--who patrolled the settlement during the day and mounted guard at night. During my stay one prisoner was chained and flogged, but that was for a serious crime committed the day before. The severest hardship which these convicts had to endure under the rule of my generous host, D. Felipe, was the obligation to work as honest men in other countries would be willing to do. In this same penal settlement, some years ago, a party of convicts attacked and killed three of the European overseers, and then escaped to the Island of Basilan, which lies to the south of Zamboanga. The leader of these criminals was a native named Pedro Cuevas, whose career is referred to at length in Chap. xxix.

Within half a day's journey from Manila there are several well-known marauders' haunts, such as San Mateo, Imus, Silan, Indan, the mouths of the Hagonoy River (Pampanga), etc. In 1881 I was the only European amongst 20 to 25 passengers in a canoe going to Balanga on the west shore of Manila Bay, when about midday a canoe, painted black and without the usual outriggers, bore down upon us, and suddenly two gun-shots were fired, whilst we were called upon to surrender. The pirates numbered eight; they had their faces bedaubed white and their canoe ballasted with stones. There was great commotion in our craft; the men shouted and the women fell into a heap over me, reciting Ave Marias, and calling upon all the Saints to succour them. Just as I extricated myself and looked out from under the palm-leaf awning, the pirates flung a stone which severely cut our pilot's face. They came very close, flourishing their knives, but our crew managed to keep them from boarding us by pushing off their canoe with the paddles. When the enemy came within range of my revolver, one of their party, who was standing up brandishing a bowie-knife, suddenly collapsed into a heap. This seemed to discourage the rest, who gave up the pursuit, and we went on to Balanga.

The most famous Tulisan within living memory was a Chinese half-caste named Juan Fernandez, commonly known as Tancad ("tall," in Tagalog) because of his extraordinary stature. His sphere of operations was around Bulacan, Tarlac, Morong, and Nueva Ecija. He took part in 21 crimes which could have been proved against him, and doubtless many more. A man of wonderful perception and great bravery, he was only 35 years old when he was captured in Bulacan Province by the Spanish Captain Villa Abrille. Brought before a court-martial on the specific charge of being the chief actor in a wholesale slaughter at Tayud, which caused a great sensation at the time, he and ten of his companions were executed on August 28, 1877, to the immense relief of the people, to whom the very name of Tancad gave a thrill of horror.

No one experienced in the Colony ever thought of privately prosecuting a captured brigand, for a criminal or civil lawsuit in the Philippines was one of the worst calamities that could befall a man. Between notaries, procurators, barristers, and the sluggish process of the courts, a litigant was fleeced of his money, often worried into a bad state of health, and kept in horrible suspense for years. It was as hard to get the judgement executed as it was to win the case. Even when the question at issue was supposed to be settled, a defect in the sentence could always be concocted to re-open the whole affair. If the case had been tried and judgement given under the Civil Code, a way was often found to convert it into a criminal case; and when apparently settled under the Criminal Code, a flaw could be discovered under the Laws of the Indies, or the Siete Partidas, or the Roman Law, or the Novisima Recopilacion, or the Antiguos fueros, Decrees, Royal Orders, Ordenanzas de buen Gobierno, and so forth, by which the case could be re-opened. It was the same in the 16th century (vide p. 56).

I knew a planter in Negros Island who was charged with homicide. The judge of his province acquitted him, but fearing that he might again be arrested on the same charge, he came up to Manila with me to procure a ratification of the sentence in the Supreme Court. The legal expenses were so enormous that he was compelled to fully mortgage his plantation. Weeks passed, and having spent all his money without getting justice, I lent his notary L40 to assist in bringing the case to an end. The planter returned to Negros apparently satisfied that he would be troubled no further, but later on, the newly-appointed judge in that Island, whilst prospecting for fees by turning up old cases, unfortunately came across this one, and my planter acquaintance was sentenced to eight years' imprisonment, although the family lawyer, proceeding on the same shifty lines, still hoped to find defects in the sentence in order to reverse it in favour of his client.

Availing one's self of the dilatoriness of the Spanish law, it was possible for a man to occupy a house, pay no rent, and refuse to quit on legal grounds during a couple of years or more. A person who had not a cent to lose could persecute another of means by a trumped-up accusation until he was ruined, by an "informacion de pobreza"--a declaration of poverty--which enabled the persecutor to keep the case going as long as he chose without needing money for fees. [111] A case of this kind was often started at the instigation of a native lawyer. When it had gone on for a certain time, the prosecutor's adviser would propose an "extra-judicial arrangement," to extort costs from the wearied and browbeaten defendant.

About the year 1886 there was a cause celebre, the parties being the firm of Jurado & Co. versus the Hong-Kong and Shanghai Banking Corporation. The Bank had agreed to make advances on goods to be imported by the firm in exchange for the firm's acceptances. The agreement was subject to six months' notice from the Bank. In due course the Bank had reason to doubt the genuineness of certain documents. Mr. Jurado was imprisoned, but shortly released on bail. He was dismissed from his official post of second chief of Telegraphs, worth P4,000 a year. Goods, as they arrived for his firm, were stored pending litigation, and deteriorated to only a fraction of their original value. His firm was forced by these circumstances into liquidation, and Mr. Jurado sued the Bank for damages. The case was open for several years, during which time the Bank coffers were once sealed by judicial warrant, a sum of cash was actually transported from the Bank premises, and the manager was nominally arrested, but really a prisoner on parole in his house. Several sentences of the Court were given in favour of each party. Years after this they were all quashed on appeal to Madrid. Mr. Jurado went to Spain to fight his case, and in 1891 I accidentally met him and his brother (a lawyer) in the street in Madrid. The brother told me the claim against the Bank then amounted to P935,000, and judgement for that sum would be given within a fortnight. Still, years after that, when I was again in Manila, the case was yet pending, and another onslaught was made on the Bank. The Court called on the manager to deliver up the funds of the Bank, and on his refusal to do so a mechanic was sent there to open the safes, but he laboured in vain for a week. Then a syndicate of Philippine capitalists was formed to fleece the Bank, one of its most energetic members being a native private banker in Manila. Whilst the case was in its first stages I happened to be discussing it at a shop in the Escolta when one of the partners, a Spaniard, asked me if I would like to see with my own eyes the contending lawyers putting their heads together over the matter. "If so," said he, "you have only to go through my shop and up the winding back staircase, from the landing of which you can see them any day you like at one o'clock." I accepted his invitation, and there, indeed, were the rival advocates laughing, gesticulating, and presumably cogitating how they could plunder the litigant who had most money to spend. At one stage of the proceedings the Bank specially retained a Spanish lawyer of great local repute, who went to Madrid to push the case. Later on Mr. Francis, Q.C., was sent over to Manila from Hong-Kong to advise the Bank. The Prime Minister was appealed to and the good offices of our Ambassador in Madrid were solicited. For a long time the Bank was placed in a most awkward legal dilemma. The other side contended that the Bank could not be heard, or appear for itself or by proxy, on the ground that under its own charter it had no right to be established in Manila; that, in view of the terms of that charter, it had never been legally registered as a Bank in Manila, and that it had no legal existence in the Philippines. This was merely a technical quibble. Several times when the case was supposed to be finally settled, it was again re-opened. Happily it may now be regarded as closed for ever.

A great many well-to-do natives have a mania for seeing their sons launched into the "learned professions"; hence there was a mob of native doctors who made a scanty living, and a swarm of half-lawyers, popularly called "abogadillos," who were a pest to the Colony. Up to the beginning of the 18th century the offices of solicitors and notaries were filled from Mexico, where the licences to practise in Manila were publicly sold. After that period the colleges and the university issued licences to natives, thus creating a class of native pettifogging advocates who stirred up strife to make cases, for this purpose availing themselves of the intricacies of the law.

The Spanish-Philippine Criminal Law Procedure was briefly as follows:--(1) The Judge of Instruction took the sumaria, i.e., the inquiry into whether a crime had been committed, and, if so, who was the presumptive culprit. It was his duty to find the facts and sift the case. In a light case he could order the immediate arrest of the presumptive delinquent; in a grave case he would remit it. (2) In the Court of First Instance the verbal evidence was heard and sifted, the fiscal, or prosecuting attorney, expressing his opinion to the judge. The judge would then qualify the crime, and decide who was the presumptive culprit. Then the defence began, and when this was exhausted the judge would give his opinion. This court could not acquit or condemn the accused. The opinion on the sumaria was merely advisory, and not a sentence. This inquiry was called the "vista"; it was not in reality a trial, as the defendant was not allowed to cross-examine; but, on the other hand, in theory, he was not called upon to prove his innocence before two courts, but before the sentencing court (Audiencia) only. The case would then be remitted with the sumaria, and the opinion of the Court of First Instance, to the Audiencia, or Supreme Court, for review of errors of law, but not of facts which remained. The Audiencia did not call for testimony, but, if new facts were produced, it would remit back the sumaria to the lower court, with the new written testimony added to the autos (documents in the case). These new witnesses were never confronted with the accused, and might never be seen by him, and were not cross-examined. If no new facts were elicited, the record of the lower court would be accepted by the Audiencia, errors of law being the only point at issue, and this court might at once pass sentence. In practice the Audiencia usually treated the finding of the lower court as sentence (not merely opinion), and confirmed it, if no new testimony were produced and there were no errors of law. But, although the opinion of the lower court might be practically an acquittal, the Audiencia might find errors of law, thus placing the accused twice in jeopardy. If the case were remitted back, in view of new testimony, it finally returned to the Audiencia for decision, nine judges being required to give their opinion in a grave case, so that if the Court of First Instance and five judges of the Audiencia found the accused guilty, there was a majority against him. The sentencing court was always the Audiencia. If the sentence were against the accused, a final appeal could be made, by "writ of error," to the Supreme Court of Spain, whose decision, however, rested not on facts, but on errors of law.

The (American) Insular Government tacitly admitted that the Spanish written law was excellent, notwithstanding its fulfilment being dilatory. The Spanish Penal Code has been adopted in its general application, but a new code, based on it, was in course of compilation in 1904. The application of the Spanish Code occasionally evolves some curious issues, showing its variance with fundamental American law. For instance, in September, 1905, a native adulteress having been found by her husband in flagrante delicto, he stabbed her to death. The Spanish law sustains the husband's right to slay his faithless consort and her paramour, in such circumstances (vide p. 80), but provides that the lawful slayer shall be banished from the country. The principle of this law is based on Roman law, human instinctive reasoning, and the spirit of the law among the Latin nations of Europe. American law assumes this natural act of the husband to be a crime, but whilst admitting the validity of the Spanish Code in these Islands, the American bench was puzzled to decide what punishment could be inflicted if the arraigned husband committed contempt of court by thereafter returning to his native land.

Chapter XV

Trade of the Islands Its Early History

From within a year after the foundation of the Colony up to the second decade of last century direct communication with Mexico was maintained by the State galleons, termed the Naos de Acapulco. The first sailings of the galleons were to Navidad, but for over two centuries Acapulco was the port of destination on the Mexican side, and this inter-communication with New Spain only ceased a few years before that Colony threw off its allegiance to the mother country. But it was not alone the troubled state of political affairs which brought about the discontinuance of the galleons' voyages, although the subsequent secession of Mexico would have produced this effect. The expense of this means of intercourse was found to be bearing too heavily upon the scanty resources of the Exchequer, for the condition of Spain's finances had never, at any period, been so lamentable.

The Commander of the State Nao had the title of General, with a salary of P40,000 per annum. The chief officer received P25,000 a year. The quarter-master was remunerated with 9 per cent, on the value of the merchandise shipped, and this amounted to a very considerable sum per voyage.

The last State galleon left Manila for Mexico in 1811, and the last sailing from Acapulco for Manila was in 1815.

These ships are described as having been short fore and aft, but of great beam, light draught, and, when afloat, had a half-moon appearance, being considerably elevated at bows and stern. They were of 1,500 tons burden, had four decks, and carried guns.

The Gov.-General, the clergy, the civil functionaries, troops, prisoners, and occasionally private persons, took passage in these ships to and from the Philippines. It was practically the Spanish Mail.

The Colony had no coin of its own. [112] It was simply a dependency of Mexico; and all that it brought in tribute and taxes to its Royal Treasury belonged to the Crown, and was at the King's disposal. For many years these payments were made wholly--and afterwards partially--in kind, and were kept in the Royal Stores. As the junks from China arrived each spring, this colonial produce belonging to the Crown was bartered for Chinese wares and manufactures. These goods, packed in precisely 1,500 bales, each of exactly the same size, constituted the official cargo, and were remitted to Mexico by the annual galleon. The surplus space in the ship was at the disposal of a few chosen merchants who formed the "Consulado,"--a trading ring which required each member to have resided in the Colony a stipulated number of years, and to be possessed of at least eight thousand pesos.

For the support of the Philippine administration Mexico remitted back to Manila, on the return of the galleon, a certain percentage of the realized value of the above-mentioned official cargo, but seeing that in any case--whether the Philippine Treasury were flourishing or not--a certain sum was absolutely necessary for the maintenance of the Colony, this remittance, known as the "Real Situado," or royal subsidy, was, from time to time, fixed. [113]

The Philippine Colony was therefore nominally self-supporting, and the Situado was only a guaranteed income, to be covered, as far as it could be, by shipments of foreign bartered manufactures and local produce to Mexico. But, as a matter of fact, the Mexican subsidy seldom, if ever, was so covered.

By Royal Decree of June 6, 1665, the Mexican subsidy to the Philippines was fixed at P2,500,000, of which P2,000,000 was remitted in coin and P500,000 in merchandise for the Royal Stores. Against this was remitted value in goods (Philippine taxes and tribute) P 176,101.40 so that the net Subsidy, or donation, from Mexico was P 2,323,898.60.

Hence, in the course of time, coin--Mexican dollars called pesos--found its way in large quantities to the Philippines, and thence to China.

The yearly value of the merchants' shipments was first limited to P250,000, whilst the return trade could not exceed P500,000 in coin or stores, and this was on the supposition that 100 per cent. profit would be realized on the sales in Mexico.

The allotment of surplus freight-room in the galleon was regulated by the issue of boletas--documents which, during a long period, served as paper money in fact, for the holders were entitled to use them for shipping goods, or they could transfer them to others who wished to do so. The demand for freight was far greater than the carrying power provided. Shipping warrants were delivered gratis to the members of the Consulado, to certain ecclesiastics, and others. Indeed, it is asserted by some writers that the Governor's favourites were served with preference, to the prejudice of legitimate trade.

The Spaniards were not allowed to go to China to fetch merchandise for transhipment, but they could freely buy what was brought by the Chinese. Indian and Persian goods uninterruptedly found their way to Manila. Spanish goods came exclusively via Mexico.

The mail galleon usually sailed in the month of July in each year, and the voyage occupied about five months. Very strict regulations were laid down regarding the course to be steered, but many calamities befell the ships, which were not unfrequently lost through the incapacity of the officers who had procured their appointments by favour. For a century and a half there was practically no competition. All was arranged beforehand as to shape, quantity, size, etc., of each bale. There was, however, a deal of trickery practised respecting the declared values, and the boletas were often quoted at high prices. Even the selling-price of the goods sent to Mexico was a preconcerted matter.

The day of the departure of the galleon or its arrival with a couple of millions of pesos or more, [114] and new faces, was naturally one of rejoicing--it was almost the event of the year. A Te Deum was chanted in the churches, the bells tolled, and musicians perambulated the streets, which were illuminated and draped with bunting.

So far as commercial affairs were concerned, the Philippine merchants passed very easy lives in those palmy days. One, sometimes two, days in the week were set down in the calendar as Saint-days to be strictly observed; hence an active business life would have been incompatible with the exactions of religion. The only misadventure they had to fear was the loss of the galleon. Market fluctuations were unknown. During the absence of the galleon, there was nothing for the merchants to do but to await the arrival of the Chinese junks in the months of March, April, and May, and prepare their bales. For a century and a half this sort of trading was lucrative; it required no smartness, no spirit of enterprise or special tact. Shippers were busy for only three months in the year, and during the remaining nine months they could enjoy life as they thought fit--cut off from the rest of the world.

Some there were who, without means of their own, speculated with the _Obras Pias_funds, lent at interest. [115]

The Philippine merchants often lost the value of their shipments in the State galleons by shipwreck or seizure by enemies. Mexico frequently lost the Philippine remittances to her, and the specie she sent to the Philippines. The State galleon made only one voyage a year there and back, if all went well; but if it were lost, the shipment had to be renewed, and it often happened that several galleons were seized in a year by Spain's enemies.

The abortive attempt to annex the British Isles to the Spanish Crown in 1588 brought about the collapse of Spain's naval supremacy, enabling English mariners to play havoc with her galleons from America. The Philippine Islands, as a colony, had at that date only just come into existence, but during the series of Anglo-Spanish wars which preceded the "Family Compact" (vide p. 87), Philippine-Mexican galleons laden with treasure became the prey of British commanders, notably Admiral Anson. The coasts were beset by Anson's squadron. He was the terror of the Philippines from the year 1743. His exploits gave rise to consternation, and numerous councils were held to decide what to do to get rid of him. The captured galleon Pilar gave one-and-a-half million pesos to the enemy--the Covadonga was an immense prize. All over the Islands the Spaniards were on the alert for the dreaded foe; every provincial Governor sent look-outs to high promontories with orders to signal by beacons if the daring Britisher's ships were seen hovering about, whilst, in Manila, the citizens were forewarned that, at any moment, they might be called upon to repel the enemy.

Not only in fleets of gold-laden vessels did Spain and her dependencies lose immense wealth through her hostile ambition, for in view of the restrictions on Philippine trade, and the enormous profits accruing to the Spanish merchants on their shipments, British, Dutch, French, and Danish traders competed with them. Shippers of these nationalities bought goods in Canton, where they established their own factories, or collecting-stores. In 1731 over three millions of Mexican dollars (pesos) were taken there for making purchases, and these foreign ships landed the stuffs, etc., in contraband at the American ports, where Spaniards themselves co-operated in the trade which their absolute King declared illicit, whilst the traders considered it a natural right.

As the Southern (Peninsula) Spanish merchants were helpless to stay this competition, which greatly affected their profits, their rancorous greed made them clamour against the Philippine trade, to which they chose to attribute their misfortunes, and the King was petitioned to curtail the commerce of this Colony with Mexico for their exclusive benefit. But it was not Spanish home trade alone which suffered: Acapulco was so beset by smugglers, whose merchandise, surreptitiously introduced, found its way to Mexico City, that, in latter days, the Philippine galleons' cargoes did not always find a market. Moreover, all kinds of frauds were practised about this time in the quality of the goods baled for shipment, and the bad results revealed themselves on the Mexican side. The shippers, unwisely, thought it possible to deceive the Mexicans by sending them inferior articles at old prices; hence their disasters became partly due to "the vaulting ambition that o'erleaps itself and falls on t'other side." The Governor commissioned four of the most respectable Manila traders to inspect the sorting and classification of the goods shipped. These citizens distinguished themselves so highly, to their own advantage, that the Governor had to suppress the commission and abandon the control, in despair of finding honest colleagues. Besides this fraud, contraband goods were taken to Acapulco in the galleons themselves, hidden in water-jars.

In the time of Governor Pedro de Arandia (1754-59) the 100 per cent. fixed profit was no longer possible. Merchants came down to Acapulco and forced the market, by waiting until the ships were obliged to catch the monsoon back, or lie up for another season, so that often the goods had to be sold for cost, or a little over. In 1754 returns were so reduced that the Consulado was owing to the Obras Pias over P300,000, and to the Casa Misericordia P147,000, without any hope of repayment. The Casa Misericordia lent money at 40 per cent., then at 35 per cent., and in 1755 at 20 per cent. interest, but the state of trade made capital hardly acceptable even at this last rate.

Early in the 18th century the Cadiz merchants, jealous of the Philippine shippers, protested that the home trade was much injured by the cargoes carried to Mexico in Philippine bottoms. So effectually did they influence the King in their favour that he issued a decree prohibiting the trade between China and the Philippines in all woven stuffs, skein and woven silk and clothing, except the finest linen. Manila imports from China were thereby limited to fine linen, porcelain, wax, pepper, cinnamon, and cloves. At the expiration of six months after the proclamation of the decree, any remaining stocks of the proscribed articles were to be burnt! Thenceforth trade in such prohibited articles was to be considered illicit, and such goods arriving in Mexico after that date were to be confiscated.

By Royal Decree dated October 27, 1720, and published in Mexico by the Viceroy on February 15, 1724, the following was enacted, viz.:--That in future there should be two galleons per annum, instead of one as heretofore, carrying merchandise to Acapulco, each to be of 500 tons. That the merchandise sent in the two was to be of the value of P300,000 precisely in gold, cinnamon, wax, porcelain, cloves, pepper, etc., but not silks, or stuffs of any kind containing silk, under pain of confiscation, to be allotted in three equal parts, namely, to the Fiscal officer, the Judge intervening, and the informer, and perpetual banishment from the Indies of all persons concerned in the shipment. That the number of Manila merchants was to be fixed, and any one not included in that number was to be prohibited from trading. No ecclesiastic, or professor of religion, or foreigner could be included in the elected few, whose rights to ship were non-transferable. That if the proceeds of the sale happened to exceed the fixed sum of P600,000, on account of market prices being higher than was anticipated, only that amount could be brought back in money, and the difference, or excess, in goods. [If it turned out to be less than that amount, the difference could not be remitted in cash by Mexican merchants for further purchases, the spirit of the decree being to curtail the supply of goods from this Colony to Mexico, for the benefit of the Spanish home traders. The infringer of this regulation was subject to the penalties of confiscation and two years' banishment from the Indies.]

By Royal Decree of the year 1726, received and published in Manila on August 9, 1727, the following regulations were made known, viz.:--That the prohibition relating to silk and all-silk goods was revoked. That only one galleon was to be sent each year (instead of two) as formerly. That the prohibition on clothing containing some silk, and a few other articles, was maintained. That for five years certain stuffs of fine linen were permitted to be shipped, to the limit of 4,000 pieces per annum, precisely in boxes containing each 500 pieces.

The Southern Spanish traders in 1729 petitioned the King against the Philippine trade in woven goods, and protested against the five-years' permission granted in the above decree of 1726, declaring that it would bring about the total ruin of the Spanish weaving industry, and that the galleons, on their return to the Philippines, instead of loading Spanish manufactures, took back specie for the continuance of their traffic to the extent of three or four millions of pesos each year. The King, however, refused to modify the decree of 1726 until the five years had expired, after which time the Governor was ordered to load the galleons according to the former decree of 1720.

The Manila merchants were in great excitement. The Governor, under pretext that the original Royal Decree ought to have been transmitted direct to the Philippines and not merely communicated by the Mexican Viceroy, agreed to "obey and not fulfil" its conditions.

From the year 1720, during the period of prohibitions, the Royal Treasury lost about P50,000 per annum, and many of the taxes were not recovered in full. Besides this, the donations to Government by the citizens, which sometimes had amounted to P40,000 in one year, ceased. A double loss was also caused to Mexico, for the people there had to pay much higher prices for their stuffs supplied by Spanish (home) monopolists, whilst Mexican coffers were being drained to make good the deficits in the Philippine Treasury. The Manila merchants were terribly alarmed, and meeting after meeting was held. A Congress of Government officials and priests was convened, and each priest was asked to express his opinion on the state of trade.

Commercial depression in the Philippines had never been so marked, and the position of affairs was made known to the King in a petition, which elicited the Royal Decree dated April 8, 1734. It provided that the value of exports should thenceforth not exceed P500,000, and the amount permitted to return was also raised to P1,000,000 (always on the supposition that 100 per cent. over cost laid down would be realized). The dues and taxes paid in Acapulco on arrival, and the dues paid in Manila on starting, amounted to 17 per cent. of the million expected to return. [116] This covered the whole cost of maintenance of ships, salaries, freight, and charges of all kinds which were paid by Government in the first instance, and then recovered from the Consulado.

The fixed number of merchants was to be decided by the merchants themselves without Government intervention. Licence was granted to allow those of Cavite to be of the number, and both Spaniards and natives were eligible. Military and other professional men, except ecclesiastics, could thenceforth be of the number. Foreigners were strictly excluded. The right to ship (boleta) was not to be transferable, except to poor widows. A sworn invoice of the shipment was to be sent to the royal officials and magistrate of the Supreme Court of Mexico for the value to be verified. The official in charge, or supercargo, was ordered to make a book containing a list of the goods and their respective owners, and to hand this to the commander of the fortress in Acapulco, with a copy of the same for the Viceroy. The Viceroy was to send his copy to the Audit Office to be again copied, and the last copy was to be forwarded to the Royal Indian Council.

Every soldier, sailor, and officer was at liberty to disembark with a box containing goods of which the Philippine value should not exceed P30, in addition to his private effects. All hidden goods were to be confiscated, one-half to the Royal Treasury, one-fourth to the Judge intervening, and one-fourth to the informer; but, if such confiscated goods amounted to P50,000 in value, the Viceroy and Mexican Council were to determine the sum to be awarded to the Judge and the informer.

If the shipment met a good market and realized more than 1,000,000 pesos, only 1,000,000 could be remitted in money, and the excess in duty-paid Mexican merchandise. If the shipment failed to fetch 1,000,000, the difference could not be sent in money for making new purchases. (The same restriction as in the decree of 1720.)

The object of these measures was to prevent Mexicans supplying trading capital to the Philippines instead of purchasing Peninsula manufactures. It was especially enacted that all goods sent to Mexico from the Philippines should have been purchased with the capital of the Philippine shippers, and be their exclusive property without lien. If it were discovered that on the return journey of the galleon merchandise was carried to the Philippines belonging to the Mexicans, it was to be confiscated, and a fine imposed on the interested parties of three times the value, payable to the Royal Treasury, on the first conviction. The second conviction entailed confiscation of all the culprits' goods and banishment from Mexico for 10 years.

The weights and measures of the goods shipped were to be Philippine, and, above all, wax was to be sent in pieces of precisely the same weight and size as by custom established.

The Council for freight allotment in Manila was to comprise the Governor, the senior Magistrate, and, failing this latter, the Minister of the Supreme Court next below him; also the Archbishop, or in his stead the Dean of the Cathedral; an ordinary Judge, a Municipal Councillor, and one merchant as Commissioner in representation of the eight who formed the Consulado of merchants.

The expulsion of the non-christian Chinese in 1755 (vide p. 111) caused a deficit in the taxes of P30,000 per annum. The only exports of Philippine produce at this date were cacao, sugar, wax, and sapanwood. Trade, and consequently the Treasury, were in a deplorable state. To remedy matters, and to make up the above P30,000, the Government proposed to levy an export duty which was to be applied to the cost of armaments fitted out against pirates. Before the tax was approved of by the King some friars loaded a vessel with export merchandise, and absolutely refused to pay the impost, alleging immunity. The Governor argued that there could be no religious immunity in trade concerns. The friars appealed to Spain, and the tax was disapproved of; meantime, most of the goods and the vessel itself rotted pending the solution of the question by the Royal Indian Council.

There have been three or four periods during which no galleon arrived at the Philippines for two or three consecutive years, and coin became very scarce, giving rise to rebellion on the part of the Chinese and misery to the Filipinos. After the capture of the Covadonga by the British, six years elapsed before a galleon brought the subsidy; then the Rosario arrived with 5,000 gold ounces (nominally P80,000).

However, besides the subsidy, the Colony had certain other sources of public revenue, as will be seen by the following:--

PHILIPPINE BUDGET FOR THE YEAR 1757

Income. P cts. Stamped Paper 12,199 87 1/2 Port and Anchorage Dues 25,938 00 Sale of Offices, such as Notaries, Public Scribes, Secretaryships, etc. 5,839 12 1/2 Offices hired out 4,718 75 Taxes farmed out 28,500 00 Excise duties 4,195 00 Sale of Encomiendas, and 22 provincial govts. hired out 263,588 00 Divers taxes, fines, pardons, etc. 18,156 00 Tribute, direct tax 4,477 00 Sudsidy from Mexico 250,000 00 Deficit 79,844 00 ------- -- P 697,455 75

Expenditure. P cts. Supreme Court 34,219 75 Treasury and Audit Office 12,092 00 University 800 00 Cost of the annual Galleon 23,465 00 Clergy 103,751 00 Land and sea forces all over the Philippines including offensive and defensive operations against Moros--Staff and Material 312,864 00 Salaries, Hospital and Divers Expenses 70,158 00 Remittance in Merchandise to Mexico on account of the Subsidy 140,106 00 ------- -- P 697,455 75

When the merchant citizens of Manila were in clover, they made donations to the Government to cover the deficits, and loans were raised amongst them to defray extraordinary disbursements, such as expeditions against the Mahometans, etc. In the good years, too, the valuation of the merchandise shipped and the corresponding returns were underrated in the sworn declarations, so that an immensely profitable trade was done on a larger scale than was legally permitted. Between 1754 and 1759, in view of the reduced profits, due to the circumstances already mentioned, the Manila merchants prayed the King for a reduction of the royal dues, which had been originally fixed on the basis of the gross returns being equal to double the cost of the merchandise laid down in Acapulco. To meet the case, another Royal Decree was issued confirming the fixed rate of royal dues and disbursements, but in compensation the cargo was thenceforth permitted to include 4,000 pieces of fine linen, without restriction as to measure or value; the sworn value was abolished, and the maximum return value of the whole shipment was raised to one-and-a-half millions of pesos. Hence the total dues and disbursements became equal to 11 1/3 per cent. instead of 17 per cent., as heretofore, on the anticipated return value.

In 1763 the Subsidy, together with the Consulado shippers' returns, amounted in one voyage to two-and-a-half millions of pesos (vide p. 88). After the independence of Mexico (1819), tribute in kind (tobacco) was, until recently, shipped direct to Spain, and Peninsula coin began to circulate in these Islands (vide Currency).

Consequent on the banishment of the non-christian Chinese in 1755, trade became stagnant. The Philippines now experienced what Spain had felt since the reign of Phillip III., when the expulsion of 900,000 Moorish agriculturists and artisans crippled her home industries, which needed a century and a half to revive. The Acapulco trade was fast on the wane, and the Manila Spanish merchants were anxious to get the local trade into their own hands. Every Chinese shop was closed by Government order, and a joint-stock trading company of Spaniards and half-breeds was formed with a capital of P76,500, in shares of P500 each. Stores were opened in the business quarter, each under the control of two Spaniards or half-breeds, the total number of shopmen being 21. The object of the company was to purchase clothing and staple goods of all kinds required in the Islands, and to sell the same at 30 per cent. over cost price. Out of the 30 per cent. were to be paid an 8 per cent. tax, a dividend of 10 per cent. per annum to the shareholders, and the remainder was to cover salaries and form a reserve fund for new investments. The company found it impossible to make the same bargains with the Chinese sellers as the Chinese buyers had done, and a large portion of the capital was soon lost. The funds at that date in the Obras Pias amounted to P159,000, and the trustees were applied to by the company for financial support, which they refused. The Governor was petitioned; theologians and magistrates were consulted on the subject. The theological objections were overruled by the judicial arguments, and the Governor ordered that P130,000 of the Obras Pias funds should be loaned to the company on debentures; nevertheless, within a year the company failed.

A commercial company, known as the "Compania Guipuzcoana de Caracas," was then created under royal sanction, and obtained certain privileges. During the term of its existence, it almost monopolized the Philippine-American trade, which was yet carried on exclusively in the State galleons. On the expiration of its charter, about the year 1783, a petition was presented to the Home Government, praying for a renewal of monopolies and privileges in favour of a new trading corporation, to be founded on a modified basis. Consequently, a charter (Real cedula) was granted on March 10, 1785, to a company, bearing the style and title of the "Real Compania de Filipinas." Its capital was P8,000,000, in 32,000 shares of P250 each. King Charles III. took up 4,000 shares; another 3,000 shares were reserved for the friars and the Manila Spanish or native residents, and the balance was allotted in the Peninsula.

The defunct company had engaged solely in the American trade, employing the galleons; its successor left that sphere of commerce and proposed to trade with the East and Europe.

[117] "To the 'Real Compania de Filipinas' was conceded the exclusive privilege of trade between Spain and the Archipelago, with the exception of the traffic between Manila and Acapulco. Its ships could fly the Royal Standard, with a signal to distinguish them from war-vessels. It was allowed two years, counting from the date of charter, to acquire foreign-built vessels and register them under the Spanish flag, free of fees. It could import, duty free, any goods for the fitting out of its ships, or ships' use. It could take into its service royal naval officers, and, whilst these were so employed, their seniority would continue to count, and in all respects they would enjoy the same rights as if they were serving in the navy. It could engage foreign sailors and officers, always provided that the captain and chief officer were Spaniards. All existing Royal Decrees and Orders, forbidding the importation into the Peninsula of stuffs and manufactured articles from India, China, and Japan were abrogated in favour of this company. Philippine produce, too, shipped to Spain by the company, could enter duty free. The prohibition on direct traffic with China and India was thenceforth abolished in favour of all Manila merchants, and the company's ships in particular could call at Chinese ports. The company undertook to support Philippine agriculture, and to spend, with this object, 4 per cent, of its nett profits."

In order to protect the company's interests, foreign ships were not allowed to bring goods from Europe to the Philippines, although they could land Chinese and Indian wares.

By the Treaties of Tordesillas and Antwerp (q.v.), the Spaniards had agreed that to reach their Oriental possessions they would take only the Western route, which would be via Mexico or round Cape Horn. These treaties, however, were virtually quashed by King Charles III. on the establishment of the "Real Compania de Filipinas." Holland only lodged a nominal protest when the company's ships were authorized to sail to the Philippines via the Cape of Good Hope, for the Spaniards' ability to compete had, meanwhile, vastly diminished.

With such important immunities, and the credit which ought to have been procurable by a company with P8,000,000 paid-up capital, its operations might have been relatively vast. However, its balance sheet, closed to October 31, 1790 (five-and-a-half years after it started), shows the total nominal assets to be only P10,700,194, largely in unrecoverable advances to tillers. The working account is not set out. Although it was never, in itself, a flourishing concern, it brought immense benefit to the Philippines (at the expense of its shareholders) by opening the way for the Colony's future commercial prosperity. This advantage operated in two ways. (1) It gave great impulse to agriculture, which thenceforth began to make important strides. By large sums of money, distributed in anticipation of the 4 per cent, on nett profit, and expended in the rural districts, it imparted life, vigour and development to those germs of husbandry--such as the cultivation of sugar-cane, tobacco, cotton, indigo, pepper, etc.--which, for a long time had been, and to a certain extent are still, the staple dependence of many provinces. (2) It opened the road to final extinction of all those vexatious prohibitions of trade with the Eastern ports and the Peninsula which had checked the energy of the Manila merchants. It was the precursor of free trade--the stepping-stone to commercial liberty in these regions.

The causes of its decline are not difficult to trace. Established as it was on a semi-official basis, all kinds of intrigues were resorted to--all manner of favouritism was besought--to secure appointments, more or less lucrative, in the Great Company. Influential incapacity prevailed over knowledge and ability, and the men intrusted with the direction of the company's operations proved themselves inexperienced and quite unfit to cope with unshackled competition from the outer world. Their very exclusiveness was an irresistible temptation to contrabandists. Manila private merchants, viewing with displeasure monopoly in any form, lost no opportunity of putting obstacles in the way of the company. Again, the willing concurrence of native labourers in an enterprise of magnitude was as impossible to secure then as it is now. The native had a high time at the expense of the company, revelling in the enjoyment of cash advances, for which some gave little, others nothing. Success could only have been achieved by forced labour, and this right was not included in the charter.

In 1825 the company was on the point of collapse, when, to support the tottering fabric, its capital was increased by P12,500,000 under Real Cedula of that year, dated June 22. King Charles IV. took 15,772 (P250) shares of this new issue. But nothing could save the wreck, and finally it was decreed, by Real Cedula of May 28, 1830, that the privileges conceded to the "Real Compania de Filipinas" had expired--and Manila was then opened to Free Trade with the whole world. It marked an epoch in Philippine affairs.

In 1820 the declared independence of Mexico, acknowledged subsequently by the European Powers, forced Spain to a decision, and direct trade between the Philippines and the mother country became a reluctant necessity. No restrictions were placed on the export to Spain of colonial produce, but value limitations were fixed with regard to Chinese goods. The export from the Philippines to Acapulco, Callao, and other South American ports was limited to P750,000 at that date. In the same year (1820) permission was granted for trade between Manila and the Asiatic ports. Twenty-two years afterwards one-third of all the Manila export trade was done with China.

When the galleons fell into disuse, communication was definitely established with Spain by merchant sailing ships via the Cape of Good Hope, whilst the opening of the Suez Canal (1869) brought the Philippines within 32 days' journey by steamer from Barcelona.

The voyage via the Cape of Good Hope occupied from three to six months; the sailings were less frequent than at the present day, and the journey was invariably attended with innumerable discomforts. It was interesting to hear the few old Spanish residents, in my time, compare their privations when they came by the Cape with the luxurious facilities of later times. What is to-day a pleasure was then a hardship, consequently the number of Spaniards in the Islands was small; their movements were always known. It was hardly possible for a Spaniard to acquire a sum of money and migrate secretly from one island to another, and still less easy was it for him to leave the Colony clandestinely.

The Spaniard of that day who settled in the Colony usually became well known during the period of the service which brought him to the Far East. If, after his retirement from public duty, on the conclusion of his tenure of office, he decided to remain in the Colony, it was often due to his being able to count on the pecuniary support and moral protection of the priests. The idea grew, so that needy Spaniards in the Philippines, in the course of time, came to entertain a kind of socialistic notion that those who had means ought to aid and set up those who had nothing, without guarantee of any kind: "Si hubiera quien me proteja!" was the common sigh--the outcome of Caesarism nurtured by a Government which discountenanced individual effort. Later on, too, many natives seemed to think that the foreign firms, and others employing large capital, might well become philanthropic institutions, paternally assisting them with unsecured capital. The natives were bred in this moral bondage: they had seen trading companies, established under royal sanction, benefit the few and collapse; they had witnessed extensive works, undertaken por via de administracion miscarry in their ostensible objects but prosper in their real intent, namely, the providing of berths for those who lived by their wits.

The patriarchal system was essayed by a wealthy firm of American merchants (Russell & Sturgis) with very disastrous results to themselves. They distributed capital all over the Colony, and the natives abused their support in a most abominable manner. A native, alleging that he had opened up a plantation, would call on the firm and procure advances against future crops after scant inquiry. Having once advanced, it was necessary to continue doing so to save the first loans.

Under the auspices of the late Mr. Nicholas Loney, great impulse was given to the commerce of Yloilo, and, due to his efforts, the Island of Negros was first opened up. His memory is still revered, and he is often spoken of as the original benefactor to the trading community of that district. Russell & Sturgis subsequently extended their operations to that locality. The result was that they were deceived in every direction by the natives, who, instead of bringing in produce to pay off advances, sent their sons to college, built fine houses, bought pianos, jewellery, etc., and in a hundred ways satisfied their pride and love for outward show in a manner never known before, at the expense of the American capitalists. As bankers, the firm enjoyed the unlimited confidence of those classes who had something to lose as well as to gain; hence it is said that, the original partners having withdrawn their money interest, the firm endeavoured to continue the business with a working capital chiefly derived from the funds deposited by private persons at 8 per cent, per annum. All might have gone well but for the rascality of the native agriculturists, who brought about the failure of the house in 1875 by taking loans and delivering no produce. The news amazed everybody. Trade was, for the moment, completely paralyzed. The great firm, which for years had been the mainspring of all Philippine mercantile enterprise, had failed! But whilst many individuals suffered (principally depositors at interest), fifty times as many families to-day owe their financial position to the generosity of the big firm; and I could mention the names of half a dozen real-estate owners in Yloilo Province who, having started with nothing, somehow found themselves possessing comparatively large fortunes at the time of the liquidation.

Consequent on the smash, a reaction set in which soon proved beneficial to the Colony at large. Foreign and Spanish houses of minor importance, which had laboured in the shade during the existence of the great firm, were now able to extend their operations in branches of trade which had hitherto been practically monopolized.

Before Manila was opened to foreign trade, even in a restricted form, special concessions appear to have been granted to a few traders. One writer mentions that a French mercantile house was founded in Manila many years prior to 1787, and that an English firm obtained permission to establish itself in 1809. In 1789 a foreign ship was allowed to enter the port of Manila and to discharge a cargo. This would appear to have been the first. In olden times the demand for ordinary foreign commodities was supplied by the Chinese traders and a few Americans and Persians. During the latter half of the 18th century a Spanish man-of-war occasionally arrived, bringing European manufactures for sale, and loaded a return cargo of Oriental goods.

The Philippine Islands were but little known in the foreign markets and commercial centres of Europe before the middle of the 19th century. Notwithstanding the special trading concessions granted to one foreigner and another from the beginning of last century, it was not until the port of Manila was unrestrictedly opened to resident foreign merchants in 1834 that a regular export trade with the whole mercantile world gradually came into existence.

It is said that whilst the charter of the "Real Compania de Filipinas" was still in force (1785-1830) a Mr. Butler [118] solicited permission to reside in and open up a trade between Manila and foreign ports; but his petition was held to be monstrous and grievously dangerous to the political security of the Colony; hence it was rejected. The Spaniards had had very good reason to doubt foreign intercourse after their experience of 1738, when they preferred a war with England to a gross abuse of the Asiento contract entered into under the Treaty of Utrecht. [119] Subsequently the American firm already mentioned, Russell & Sturgis, made a request to be allowed to trade, which, having the support of the Gov.-General of the day, was granted; and Mr. Butler, taking advantage of this recent precedent, also succeeded in founding a commercial house in Manila. To these foreigners is due the initiation of the traffic in those products which became the staple trade of the Colony and paved the way for the bulk of the business being, as it is to-day, in the hands of European and American merchants.

The distrustful sentiment of olden times (justifiable in the 18th century) pervaded the Spaniards' commercial and colonial policy up to their last day. Proposed reforms and solicitations for permission to introduce modern improvements were by no means welcomed. In the provinces clerical opposition was often cast against liberal innovations, and in the Government bureaux they were encompassed with obstructive formalities, objections, and delays. [120]

By Royal Ordinance of 1844 strangers were excluded from the interior; in 1857 unrepealed decrees were brought forward to urge the prohibition of foreigners to establish themselves in the Colony; and, as late as 1886, their trading here was declared to be "prejudicial to the material interests of the country." [121]

The support of the friars referred to in p. 255 became a thing of the past. Colonists had increased tenfold, the means of communication and of exit were too ample for the security of the lenders, who, as members of religious communities, could not seek redress at law, and, moreover, those "lucky hits" which were made by penniless Europeans in former times by pecuniary help "just in the nick of time" were no longer possible, for every known channel of lucrative transaction was in time taken up by capitalists.

It was the capital brought originally to the Philippines through foreign channels which developed the modern commerce of the Colony, and much of the present wealth of the inhabitants engaged in trade and agriculture is indirectly due to foreign enterprise. Negros Island was entirely opened up by foreign capital. In Manila, the fathers of many of the half-castes and pure natives who at this day figure as men of position and standing, commenced their careers as messengers, warehouse-keepers, clerks, etc., of the foreign houses.

There were a great many well-to-do Spaniards in trade, but few whose funds on starting were brought by them from the Peninsula. The first Spanish steamer-owner in the Colony, a baker by trade, owed his prosperity to the support of Russell & Sturgis. One of the richest Spanish merchants (who died in 1894) once kept a little grocer's shop, and after the failure of Russell & Sturgis he developed into a merchant and shipowner whose firm became, in time, the largest Spanish house operating in hemp and other produce.

About 14 Spanish firms of a certain importance were established in Manila, Yloilo, and Cebu, in addition to the Europeans trading here and there on the coasts of the Islands. In Manila there were (and are still) two foreign bank branches [122] (one with a sub-branch in Yloilo), three bank agencies, and the Philippine private banking-house of J. M. Tuason & Co.; also the "Banco Espanol-Filipino," which was instituted in 1852, with a capital of P400,000, in 2,000 shares of P200 each. The capital was subsequently increased to P600.000. [123] Authorized by charter, it issued notes payable to bearer on demand from P10 upwards. The legal maximum limit of note issue was P1,200,000, whilst the actual circulation was about P100,000 short of that figure. This bank did a very limited amount of very secure business, and it has paid dividends of 12 to 15 per cent.; hence the shares were always at a premium. In 1888, when 12 per cent, dividend was paid, this stock was quoted at P420; in 1895 it rose to P435. The Obras Pias funds (vide p. 245) constituted the orginal capital of the bank. The new position of this institution, under the (American) Insular Government since 1905, is explained in Chapter xxxi.

The first Philippine bank was opened in Manila by a certain Francisco Rodriguez about the year 1830.

From the conquest up to the year 1857 there was no Philippine coinage. Mexican dollars were the only currency, and in default of subsidiary money these dollars, called pesos, were cut. In 1764 cut money was prohibited, and small Spanish silver and copper coins came to the Islands. In 1799 the Gov.-General forbade the exportation of money, and fixed the peso at 8 reales fuertes and the real at 17 cuartos. Shortly afterwards gold came to the Islands, and was plentiful until 1882. In 1837 other copper coins came from Spain, and the real fuerte was fixed at 20 cuartos. In 1857 the Manila mint was established, pesetas were introduced, five being equal to one peso, and 32 cuartos being equal to one peseta. Contemporaneously the coinage in Spain was 34 cuartos to one peseta and 5 pesetas to one duro--the coin nominally equivalent to the peso--but the duro being subdivided into 20 reales vellon, the colonial real fuerte came to be equivalent to 2 1/2 reales vellon. The evident intention was to have one common nominal basis (peso and duro), but subdivided in a manner to limit the currency of the colonial coinage to its own locality. With pesos, reales, cuartos, maravedis, and ounces of gold, bookkeeping was somewhat complicated; however, the Government accounts were rendered easy by a decree dated January 17, 1857, which fixed pesos and cents for official reckoning. Merchants then adopted this standard. Up to 1860 gold was so abundant that as much as 10 per cent, was paid to exchange an onza of gold (P16) for silver. In 1878 gold and silver were worth their nominal relative values. Gold, however, has gradually disappeared from the Colony, large quantities having been exported to China. In 1881 the current premium for purchasing gold was 2 per cent., and at the beginning of 1885 as much as 10 per cent. premium was paid for Philippine gold of the Isabella II or any previous coinage. The gold currency of Alfonso XII. (1875-85) was always of less intrinsic value than the coin of earlier date, the difference averaging about 2 per cent. At the present day gold could only be obtained in very limited quantities at about the same rate as sight drafts on Europe. Philippine gold pieces are rare.

In 1883 Mexican dollars of a later coinage than 1877 were called in, and a term was fixed after which they would cease to be legal tender. In 1885 decimal bronze coins were introduced. In July, 1886, a decree was published calling in all foreign and Chinese chop dollars [124] within six months, after which date the introducer of such coin into the Colony would be subject to the penalty of a fine equal to 20 per cent. of the value imported, the obligation to immediately re-export the coin, and civil action for the misdemeanour. At the expiration of the six months the Treasury was not in a position to effect the conversion of the foreign medium in private hands prior to the publication of the decree. The term was extended, but in time the measure became practically void, so far as the legal tender was concerned. However, the importation of Mexican dollars was still prohibited; but, as they remained current in Manila at par value, whilst in Hong-Kong and Singapore they could be bought for 8 to 12 per cent, (and in 1894 25 per cent.) less than Manila dollars, large quantities were smuggled into the Colony. It is estimated that in the year 1887 the clandestine introduction of Mexican dollars into Manila averaged about P150,000 per month. I remember a Chinaman was caught in September, 1887, with P164,000, imported in cases declared to contain matches. In 1890 there was a "boom" in the silver market. Owing to the action of the American Silverites, the Washington Treasury called for a monthly supply of 4,000,000 of silver dollars; consequently sight rate on London in Hong-Kong touched 3s. 10 1/4d., and in Manila rose to 3s. 10 1/2d., but a rapid reaction set in when the Treasury demand ceased. In 1895 we heard in Manila that the Government were about to coin Philippine pesos and absolutely demonetize Mexicans as a medium in the Islands. But this measure was never carried out, probably because the Government had not the necessary cash with which to effect the conversion. Some few Philippine peso pieces were, however, put into circulation concurrently with the Mexican pesos.

In June, 1903, the ss. Don Juan, owned by Francisco L. Rojas, of Manila, took on board in Hong-Kong about $400,000 Mexicans (i.e., pesos) for the purpose of smuggling them into Manila. On board there were also, as passengers, a Senor Rodoreda and a crowd of Chinese coolies. The vessel caught fire off the west coast of Luzon. The captain, the crew, and the Spanish passenger abandoned the ship in boats, leaving the Chinese to their awful fate. A steam launch was sent alongside and saved a few dollars, whilst the despairing Chinese became victims to the flames and sharks. The ship's burnt-out hull was towed to Manila Bay. The remaining dollars were confiscated, and the captain and chief engineer were prosecuted.

The universal monetary crisis due to the depreciation of silver was experienced here, and the Government made matters still worse by coining half-pesos and 20-cent pieces, which had not the intrinsic value expressed, and exchange consequently fell still lower. In September, 1887, a Madrid periodical, Correo de Espana, stated that the bastard Philippine 50-cent pieces were rejected in Madrid even by money-changers. In May, 1888, the peso was quoted at 3s.2 3/4d. (over 19 per cent. below nominal value), and shippers to the Colony, who had already suffered considerably by the loss on exchange, had their interests still further impaired by this action of the Treasury. For Exchange Fluctuations vide Chap, xxxi., "Trade Statistics."

A Custom-house was established and port opened in Zamboanga (Mindanao Is.) for direct communication with abroad in 1831; those of Sual (Pangasinan) and Yloilo (Panay Is.) in 1855, and that of Cebu in 1863. The Custom-house of Sual was subsequently abolished, and the port having been closed to direct foreign trade, the place has lost its former importance, and lapsed into the state of a lifeless village.

Special permission could be obtained for ships to load in and sail direct from harbours where no Custom-houses were established, on a sum of money being lodged beforehand at the _Caja de Depositos _in Manila, to cover duties, dues, etc., to be assessed.

After the opening of the port of Yloilo, three years elapsed before a cargo of produce sailed thence to a foreign port. Since then it has gradually become the shipping centre for the crops (chiefly sugar and sapanwood) raised in the islands of Panay and Negros. From about the year 1882 to 1897 it attracted a portion of what was formerly the Cebu trade. Since then the importance of Yloilo has diminished. Its development as a port was entirely due to foreigners, and considerably aided agriculture in the Visayas Islands. Heretofore the small output of sugar (which had never reached 1,000 tons in any year) had to be sent up to Manila. The expense of local freight, brokerages, and double loading and discharging left so little profit to the planters that the results were then quite discouraging. None but wooden sugar-cane mills were employed at that time, but since then many small steam-power factories have been erected (vide Sugar). The produce shipped in Yloilo [125] was principally carried to the United States in American sailing-ships.

For figures relating to Chief Exports from the various ports, vide Chap. xxxi., "Trade Statistics."

Most of the carrying Import trade was in the hands of subsidized Spanish steamer-owners, whilst the larger portion of the Exports was conveyed in foreign vessels, which arrived in ballast from Eastern ports where they had left cargoes.

Smuggling was carried on to a considerable extent for years, and in 1891 a fresh stimulus was given to contraband by the introduction of a Protectionist Tariff, which came into force on April 1 of that year, and under which Spanish goods brought in Spanish ships were allowed to enter free of duty. [126]

In order to evade the payment of the Manila Port Works Tax (q.v.), for which no value was given, large quantities of piece-goods for Manila were shipped from Europe to Yloilo, passed through the Custom-house there and re-shipped in inter-island steamers to Manila. In 1890 some two-thirds of the Yloilo foreign imports were for re-shipment.

The circumstances which directly led to the opening of Zamboanga (in 1831) as a commercial port are interesting when it is remembered that Mindanao Island is still quasi-independent in the interior--inhabited by races unconquered by the Spaniards, and where agriculture by civilized settlers is as yet nascent. It appears that the Port of Jolo (Sulu Is.) had been, for a long time, frequented by foreign ships, whose owners or officers (chiefly British) unscrupulously supplied the Sulus with sundry manufactured goods, including arms of warfare, much to the detriment of Spanish interests there, in exchange for mother-of-pearl, pearls, gums, etc. The Spaniards claimed suzerain rights over the island, but were not strong enough to establish and protect a Custom-house, so they imposed the regulation that ships loading in Jolo should put in at Zamboanga for clearance to foreign ports. The foreigners who carried on this illicit traffic protested against a sailing-ship being required to go out of her homeward course about one hundred and twenty miles for the mere formality of customs clearance. A British ship (and perhaps many before her) sailed straight away from Jolo, in defiance of the Spaniards, and the matter was then brought to the notice of the British Government, who intimated that either Jolo must be declared a free port or a Custom-house must be established there. The former alternative was chosen by the Spaniards, but Zamboanga remained an open port for foreign trade which very rarely came.

The supreme control of merchant shipping and naval forces was vested in the same high official. No foreigner was permitted to own a vessel trading between Spain and her colonies, or between one Spanish colony and another, or doing a coasting trade within the Colony. This difficulty was however readily overcome, and reduced to a mere ineffective formality, by foreigners employing Spaniards to become nominal owners of their vessels. Thus a very large portion of the inter-island steamer carrying-trade was virtually conducted by foreigners, chiefly British.

Mail-steamers, subsidized by the Government, left the capital every fortnight for the different islands, and there was a quarterly Pacific Mail Service to the Ladrone Islands. [127] Regular mails arrived from, and left for, Europe every fortnight, but as there were intermediate opportunities of remitting and receiving correspondence, really about three mails were received and three despatched every month. The mail-route for Europe is via Singapore, but there were some seven or eight sailings of steamers per month between Manila and Hong-Kong (the nearest foreign colony--640 miles), whence mails were forwarded to Europe, Australia, Japan, the United States, etc.

Between the capital and several ports in the adjacent provinces there was a daily service of passenger and light cargo-steamers.

Between Yloilo and the adjoining Province of Antique, the District of Concepcion and the Islands of Negros and Cebu, there were some half-dozen small steamers, belonging to Filipinos and Spaniards, running regularly with passengers and merchandise, whilst in the sugar-producing season--from January to May--they were fully freighted with cargoes of this staple article.

The carrying-trade in sailing craft between the Islands was chiefly in the hands of natives and half-castes. There were also a few Spanish sailing-ship owners, and in the Port of Yloilo a few schooners (called lorchas), loading from 40 to 100 tons of sugar, were the property of foreigners, under the nominal ownership of Spanish subjects, for the reasons mentioned in the preceding page.

The principal exporters employ middlemen for the collecting of produce, and usually require their guarantee for sales at credit to the provincial purchasers of imports. These middlemen are always persons of means, born in the Colony, and, understanding both the intricacies of the native character and the European mode of transacting business, they serve as very useful--almost indispensable--intermediaries.

It was only when the crisis in the Sugar trade affected the whole world, and began to be felt in the Philippines in 1884, that the majority of the natives engaged in that industry slowly began to understand that the current price of produce fluctuated according to supply and demand. Before transactions were so thoroughly in the hands of middlemen, small producers used to take their samples to the purchasers, "to see how much they cared to pay" as they expressed it--the term "market price" seldom being used or understood in the provinces, because of the belief that prices rose or fell according to the caprice or generosity of the foreign buyer. Accustomed to deal, during the first centuries of the Spanish occupation, with the Chinese, the natives, even among themselves, rarely have fixed prices in retail dealings, and nearly every quotation in small traffic is taken only as a fancy price, subject to considerable rebate before closing. The Chinese understand the native pretty well; they study his likings, and they so fix their prices that an enormous reduction can be made for his satisfaction. He goes away quite contented, whilst the Chinaman chuckles over having got the best of the bargain. Even the import houses, when they advertise their goods for sale, seldom state the prices; it seems as if all regarded the question of price as a shifty one.

The system of giving credit in the retail trade of Manila, and a few provincial towns, was the ruin of many shopkeepers. There were few retailers who had fixed prices; most of them fluctuated according to the race, or nationality, of the intending customer. The Chinese dealer made no secret about his price being merely nominal. If on the first offer the hesitating purchaser were about to move away, he would call after him and politely invite him to haggle over the bargain. [128]

The only real basis of wealth in the Colony is the raw material obtained by Agriculture, and Forest produce. Nothing was done by the conquerors to foster the Industrial Arts, and the Manufacturing Trades were of insignificant importance. Cigars were the only manufactured export staple, whilst perfumes, a little cordage, and occasionally a parcel of straw or finely-split bamboo hats were shipped.

In the Provinces of Bulacan and Pampanga, split-cane and Nito (lygodium) hats, straw mats, and cigar-cases are made. Some of the finest worked cigar-cases require so much time for making that they cost up to P20 each. Hats can only be obtained in quantities by shippers through native middlemen.

In Yloilo Province a rough cloth called Sinamay is woven [129] from selected hemp fibre. Also in this province and that of Antique (Panay Is.), Pina muslin of pure pine-leaf fibre and Husi of mixed pine-leaf and hemp filament are made. Ilocos Province has a reputation in these Islands for its woollen and dyed cotton fabrics. Taal (Batangas) also produces a special make of cotton stuffs. Pasig, on the river of that name, and Sulipan (Pampanga), are locally known for their rough pottery, and Capiz and Romblon for their sugar-bags.

Paete, at the extreme east of the Laguna de Bay, is the centre for white-wood furniture and wood-carving. In Mariquina, near Manila, wooden clogs and native leather shoes are made. Santa Cruz (Manila) is the gold and silver-workers' quarter. The native women in nearly all the civilized provinces produce some very handsome specimens of embroidery on European patterns. Mats to sleep upon (petates) straw bags (bayones), baskets (tampipes), alcohol, bamboo furniture, buffalo-hide leather, wax candles, soap, etc., have their centres of manufacture on a small scale. The first Philippine brewery was opened October 4, 1890, in San Miguel (Manila) by Don Enrique Barretto, to whom was granted a monopoly by the Spanish Government for twenty years. It is now chiefly owned by a Philippine half-caste, Don Pedro P. Rojas (resident in Paris), who formed it into a company which has become a very flourishing concern. Philippine capital alone supports these manufactures. The traffic and consumption being entirely local, the consequent increase of wealth to the Colony is the economized difference between them and imported articles. These industries bring no fresh capital to the Colony, by way of profits, but they contribute to check its egress by the returns of agriculture changing hands to the local manufacturer instead of to the foreign merchant.

Want of cheap means of land-transport has, so far, been the chief drawback to Philippine manufactures, which are of small importance in the total trade of the Colony.

Philippine railways were first officially projected in 1875, when a Royal Decree of that year, dated August 6, determined the legislative basis for works of that nature. The Inspector of Public Works was instructed to form a general plan of a railway system in Luzon Island. The projected system included (1) a line running north from Manila through the Provinces of Bulacan, Pampanga, and Pangasinan. (2) A line running south from Manila, along the Laguna de Bay shore and eastwards through Tayabas, Camarines, and Albay Provinces. (3) A branch from this line on the Laguna de Bay shore to run almost due south to Batangas. The lines to be constructed were classed under two heads, viz.:--(1) Those of general public utility to be laid down either by the State or by subsidized companies, the concession in this case being given by the Home Government; and (2) those of private interest, for the construction of which concessions could be granted by the Gov.-General.

In 1885 the Government solicited tenders for the laying of the first line of railway from Manila to Dagupan--a port on the Gulf of Lingayen, and the only practicable outlet for produce from the Province of Pangasinan and Tarlac District. The distance by sea is 216 miles--the railway line 196 kilometres (say 120 miles). The subsidy offered by the Government amounted to about P7,650 per mile, but on three occasions no tender was forthcoming either from Madrid or in Manila, where it was simultaneously solicited. Subsequently a modified offer was made of a guaranteed annual interest of 8 per cent, on a maximum outlay of P4,964,473.65, and the news was received in Manila in October, 1886, that the contract had been taken up by a London firm of contractors. The prospectus of "The Manila Railway Co., Ltd," was issued in February, 1888. The line was to be completed within four years from July 21, 1887, and at the end of ninety-nine years the railway and rolling-stock were to revert to the Spanish Government without compensation. The rails, locomotives (36 tons and 12 tons each), tenders, coaches, waggons, and ironwork for bridges all came from England. The first stone of the Central Station in Manila (Bilibid Road, Tondo) was laid by Gov.-General Emilio Terrero on July 31, 1887. In 1890 the original contractors failed, and only the first section of 28 miles was opened to traffic on March 24, 1891.

Many other circumstances, however, contributed to delay the opening of the whole line. Compensation claims were very slowly agreed to; the Government engineers slightly altered the plans; the company's engineers could not find a hard strata in the bed of the Calumpit River [130] (a branch of the Rio Grande de Pampanga) on which to build the piers of the bridge; and lastly the Spanish authorities, who had direct intervention in the work, found all sorts of excuses for postponing the opening of the line. When the Civil Director was applied to, he calmly replied that he was going to the baths, and would think about it. Finally, on appeal to the highest authority, Gov.-General Despujols himself went up to Tarlac, and in an energetic speech, reflecting on the dilatoriness of his subordinates, he declared the first Philippine railway open to traffic on November 23, 1892. For about a year and a half passengers and goods were ferried across the Calumpit River in pontoons. Large caissons had to be sunk in the river in which to build the piers for the iron bridge, which cost an enormous sum of money in excess of the estimate. Later on heavy rains caused a partial inundation of the line, the embankment of which yielded to the accumulated mass of water, and traffic to Dagupan was temporarily suspended. The total outlay on the line far exceeded the company's original calculation, and to avert a financial collapse fresh capital had to be raised by the issue of 6 per cent. Prior Lien Mortgage Bonds, ranking before the debenture stock. The following official quotations on the London Stock Exchange will show the public appreciation of the Manila Railway Company's shares and bonds:--

OFFICIAL QUOTATIONS.

December. | 7% Cum. Pref. L10 Shares. | | 6% Deb. L100 Stock. | | | 6% Prior Lien Mort. Bonds, | | | Series A., L100. | | | | 6% Prior Lien Mort. Bonds, | | | | Series B., L100.

L L L L 1893 2 49 98 87 1894 1 32 104 91 1895 1/2 29 107 85 1896 1/4 22 96 64 1897 1/4 19 101 75 1898 1 3/4 45 110 98 1899 1 3/4 33 1/2 101 1/2 87 1/2 1900 1 1/2 42 103 1/2 97 1901 2 55 108 102 1902 1 1/2 52 109 102 1903 1 1/2 58 108 104 1904 3 1/2 83 110 107 1905 4 3/4 117 110 106

Up to July 1, 1905, the interest has been regularly paid on the Prior Lien Bonds. No interest has been paid on the debentures (up to December, 1905) since July 1, 1891, nor on the 7 per cent. Cumulative Preference Shares since July 1, 1890. On January 26, 1895, these shares were officially quoted, for sellers, 0.

Including the termini in Manila (Tondo) and Dagupan, there are 29 stations and 16 bridges along the main line, over which the journey occupies eight hours. There are two branch lines, viz.:--from Bigaa to Cabanatuan (Nueva Ecija), and from Angeles (Pampanga) to Camp Stotsenberg. From the Manila terminus there is a short line (about a mile) running down to the quay in Binondo for goods traffic only. The country through which this line passes is flat, and has large natural resources, the development of which--without a railway--had not been feasible owing to the ranges of mountains--chiefly the Cordillera of Zambales--which run parallel to the coast.

The railway is ably managed, but when I travelled on it in 1904 much of the rolling-stock needed renewal.

In 1890, under Royal Order No. 508, dated June 11 of that year, a 99 years' concession was granted to a British commercial firm in Manila to lay a 21-mile line of railway, without subsidy, from Manila to Antipolo, to be called the "Centre of Luzon Railway." The work was to be commenced within one year and finished within two years. The basis of the anticipated traffic was the conveyance of pilgrims to the Shrine of Our Lady of Good Voyage and Peace (vide p. 184); but, moreover, the proposed line connected the parishes of Dilao (then 4,380 pop.), Santa Ana (then 2,115 pop.), Mariquina (then 10,000 pop.), Cainta (then 2,300 pop.), and Taytay (then 6,500 pop.)--branching to Pasig and Angono--with Antipolo (then 3,800; now 2,800 pop.). The estimated outlay was about P1,000,000, but the concession was abandoned. The project has since been revived under American auspices.

Under Spanish government there was a land Telegraph Service from Manila to all civilized parts of Luzon Island--also in Panay Island from Capiz to Yloilo, and in Cebu Island from the city of Cebu across the Island and up the west coast as far north as Tuburan. There was a land-line from Manila to Bolinao (Zambales), from which point a submarine cable was laid in April, 1880, by the Eastern Extension Australasia and China Telegraph Company, Ltd., whereby Manila was placed in direct telegraphic communication with the rest of the world. For this service the Spanish Government paid the company P4,000 a month for a period of 10 years, which expired in June, 1890. In April, 1898, the same company detached the cable from Bolinao and carried it on to Manila in the s.s. Sherard Osborn, 207 nautical miles having been added to the cable for the purpose. In return for this service the Spanish Government gave the company certain exclusive rights and valuable concessions. In May, 1898, the American Admiral Dewey ordered the Manila-Hong-Kong cable to be cut, but the connection was made good again after the Preliminaries of Peace with Spain were signed (August 12, 1898). Cable communication was suspended, therefore, from May 2 until August 21 of that year.

In 1897 another submarine cable was laid by the above company, under contract with the Spanish Government, connecting Manila with the Southern Islands of Panay and Cebu (Tuburan). The Manila-Panay cable was also cut by order of Admiral Dewey (May 23, 1898), but after August 12, under an arrangement made between the American and Spanish Governments, it was re-opened on a neutral basis, and the company's own staff worked it direct with the Manila public, instead of through the medium of Spanish officials.

Since the American occupation a new cable connecting the Islands with the United States has been laid (opened July 4, 1903), whilst a network of submarine and land-wires has been established throughout the Archipelago.

Owing to their geographical position, none of the Philippine ports are on the line of the regular mail and passenger steamers en route elsewhere; hence, unlike Hong-Kong, Singapore, and other Eastern ports, there is little profit to be derived from a cosmopolitan floating population. Due, probably, to the tedious Customs regulations--the obligation of every person to procure, and carry on his person, a document of identification--the requirement of a passport to enter the Islands, and complicated formalities to recover it on leaving--the absence of railroads and hotels in the interior and the difficulties of travelling--this Colony, during the Spanish regime, was apparently outside the region of tourists and "globe-trotters." Indeed the Philippine Archipelago formed an isolated settlement in the Far East which traders or pleasure-seekers rarely visited en passant to explore and reveal to the world its natural wealth and beauty. It was a Colony comparatively so little known that, forty years ago, fairly educated people in England used to refer to it as "The Manillas," whilst up to the end of Spanish rule old residents, on visiting Singapore and Hong-Kong, were often highly amused by the extravagant notions which prevailed, even there, concerning the Philippines. But the regulations above referred to were an advantage to the respectable resident, for they had the desirable effect of excluding many of those nondescript wanderers and social outcasts who invade other colonies.

Since the Revolution there has been a large influx of American tourists to the Islands, arriving in the army-transports, passage free, to see "the new possession," as the Archipelago is popularly called in the United States.

XVI. Agriculture

In years gone by, before so many colonies were opened up all over the world, the few who, in the Philippines, had the courage to face the obstacles to agriculture in a primitive country made fairly large fortunes in the main staple products--sugar and hemp. Prices were then treble what they have since been, labour was cheaper, because the needs of the labouring-class were fewer, and, owing to the limited demand and the rarity of epidemic cattle-disease, buffaloes for tilling were worth one-eighth of what they cost at the present day. Although the amount of trade was vastly less, those natives engaged in it were in sounder positions than the same class generally is now.

Within the last few years there are hundreds who have embarked in agricultural enterprises with only one-tenth of the capital necessary to make them successful. A man would start planting with only a few hundred pesos and a tract of cleared land, without title-deeds, and consequently of no negotiable value. In the first year he inevitably fell into the hands of money-lenders, who reasonably stipulated for a very high rate of interest in view of the absence of guarantees. The rates of interest on loans under such circumstances varied as a rule from 12 to 24 per cent. I know a Visayo native who, by way of interest, commission, and charges, demanded as much as 30 per cent. I need not refer to the isolated cases which have come to my knowledge of over 100 per cent. being charged. As at the present day agriculture in the Philippines does not yield 30 per cent. nett profit, it naturally follows that the money-lender at this rate has to attach the estate upon which he has made loans, and finally becomes owner of it. In the meantime, the tiller who has directed the labour of converting a tract of land into a plantation, simply gets a living out of it. Some few were able to disencumber their property by paying, year by year, not only the whole of the nett returns from the plantation, but also the profits on small traffic in which they may have speculated. It seldom happened, however, that the native planter was sufficiently loyal to his financial supporter to do this: on the contrary, although he might owe thousands of pesos, he would spend money in feasts, and undertake fresh obligations of a most worthless nature. He would buy on credit, to be paid for after the next crop, a quantity of paltry jewellery from the first hawker who passed his way, or let the cash slip out of his hands at the cock-pit or the gambling-table.

Even the most provident seemed to make no reserve for a bad year, and the consequence was that in 1887 I think I may safely assert that if all the Philippine planters had had to liquidate within twelve months, certainly 50 per cent. of them would have been insolvent. One of the most hazardous businesses in the Colony is that of advancing to the native planters, unless it be done with the express intention of eventually becoming owner of an estate, which is really often the case.

The conditions of land-tenure in Luzon Island under Spanish rule stood briefly thus:--The owners either held the lands by virtue of undisturbed possession or by transferable State grant. The tenants--the actual tillers--were one degree advanced beyond the state of slave cultivators, inasmuch as they could accumulate property and were free to transfer their services. They corresponded to that class of farmers known in France as metayers and amongst the Romans of old as Coloni Partiarii, with no right in the land, but entitled to one-half of its produce. Like the ancients, they had to perform a number of services to the proprietor which were not specified in writing, but enforced by usage. Tenants of this kind recently subsisted--and perhaps still do--in Scotland (vide "Wealth of Nations," by Adam Smith, edition of 1886, p. 160). Leases for long periods were exceptional, and I never heard of compensation being granted for improvements of Philippine estates. The conditions in Visayas are explained on p. 274.

The value of land suitable for Sugar-cane growing varies considerably, being dependent on proximity to a port, or sugar-market, and on quality, facilities for drainage, transport, site, boundaries, etc.

In the Province of Bulacan, land which in a great measure is exhausted and yields only an average of 21 tons of cane per acre, was valued (prior to the American occupation), on account of its nearness to the capital, at P115 per acre. In Pampanga Province, a little further north, the average value of land, yielding, say, 30 tons of cane per acre, was P75 per acre. Still further north, in the Province of Nueva Ecija, whence transport to the sugar-market is difficult and can only be economically effected in the wet season by river, land producing an average of 35 tons of cane per acre would hardly fetch more than P30 per acre. Railroads will no doubt eventually level these values.

In reality, Bulacan land is priced higher than its intrinsic value as ascertained by yield and economy of produce-transport. The natives are, everywhere in the Colony, more or less averse to alienating real estate inherited from their forefathers, and as Bulacan is one of the first provinces where lands were taken up, centuries ago, an attachment to the soil is particularly noticeable. In that province, as a rule, only genuine necessity, or a fancy price far in excess of producing-worth, would induce an owner to sell his land.

Land grants were obtainable from the Spanish Government by proving priority of claim, but the concession was only given after wearisome delay, and sometimes it took years to obtain the title-deeds. Then large capital was requisite to utilize the property, the clearance often costing more than the virgin tract, whilst the eviction of squatters was a most difficult undertaking: "J'y suis et j'y reste," thought the squatter, and the grantee had no speedy redress at law. On the other hand, the soil is so wonderfully rich and fertile that the study of geoponics and artificial manuring was never thought essential.

The finest sugar-cane producing island in the Archipelago is Negros, in the Visaya district, between N. latitudes 9 deg. and 11 deg.. The area of the Island is about equal to that of Porto Rico, but for want of capital is only about one-half opened up. Nevertheless, it sent to the Yloilo market in 1892 over 115,000 tons of raw sugar--the largest crop it has yet produced. In 1850 the Negros sugar yield was 625 tons.

The price of uncleared land there, suitable for sugar-cane cultivation, in accessible spots, was, say, P35 per acre, and cleared land might be considered worth about P70 per acre. The yield of sugar-cane may be estimated at 40 tons per acre on the estates opened up within the last ten years, whilst the older estates produce per acre nearly 30 tons of cane, but of a quality which gives such a high-class sugar that it compensates for the decrease in quantity, taking also into account the economy of manipulating and transporting less bulk.

Otaheiti cane (yellow) is generally planted in Luzon, whilst Java cane (red) is most common in the southern islands. Tubo is the Tagalog generic name for sugar-cane.

The following equivalents of Philippine land-measures may be useful, viz.:--

1 Quinon = 40,000 square varas = 10,000 square brazas. = 5 cabans = 6.9444 acres = 2.795 hectares.

1 Balita = 4,000 square varas = 1,000 square brazas. = .69444 acre = .2795 hectare.

1 Loan = 400 square varas = 100 square brazas. = .06944 acre = .02795 hectare.

1 Square Braza = 3.3611 square English yards. = 4,355.98 square English inches.

1 Square Vara = .8402 square English yards. = 1,088.89 square English inches.

1 Acre = 5,760 square varas = 1.44 balitas. = .72 caban = .404671 hectare.

The average yield of sugar per acre is about as follows, viz.:--

Pampanga Province, say @ 6 1/2% extraction = 1.95 Tons of Sugar. Other Northern provinces, say @ 5 1/2% extraction = 1.65 Tons of Sugar. Negros Island (with almost exclusively European mills), say @ 7 1/2% extraction = 2.75 Tons of Sugar.

From Yloilo the sugar is chiefly exported to the United States, where there is a demand for raw material only from the Philippines for the purpose of refining, whilst from Manila a certain quantity of crystal-grain sugar is sent, ready for consumption, to Spain. Consequently, in the Island of Luzon, a higher class of machinery is employed. In 1890 there were five private estates, with vacuum-pans erected, and one refinery, near Manila, (at Malabon). Also in 1885 the Government acquired a sugar-machinery plant with vacuum-pan for their model estate at San Ramon in the Province of Zamboanga; the sugar turned out at the trial of the plant in my presence was equal to 21 D. S. of that year. Convict labour was employed. During the Rebellion half the machinery on this estate was destroyed or stolen.

It is a rare thing to see other than European mills in the Island of Negros, whilst in every other sugar-producing province roughly-made vertical cattle-mills of wood, or stone (wood in the south and stone in the north), as introduced by the Chinese, are still in use. With one exception (at Cabanatuan, Nueva Ecija), which was a failure, the triple-effect refining-plant is altogether unknown in this Colony.

The sugar-estates generally are small. There are not a dozen estates in the whole Colony which produce over 1,000 tons of raw sugar each per season. An estate turning out 500 tons of sugar is considered a large one. I know of one estate which yielded 1,500 tons, and another 1,900 tons in a good season. In the Island of Negros there is no port suitable for loading ships of large tonnage, and the crops have to be carried to the Yloilo market, in small schooners loading from 40 to 100 tons (vide p. 263). From the estates to the coast there are neither canals nor railroads, and the transport is by buffalo-cart.

The highest tablelands are used for cane-planting, which imperatively requires a good system of drainage. In Luzon Island the output of sugar would be far greater if more attention were paid to the seasons. The cane should be cut in December, and the milling should never last over ten weeks. The new cane-point setting should be commenced a fortnight after the milling begins, and the whole operation of manufacture and planting for the new crop should be finished by the middle of March. A deal of sugar is lost by delay in each branch of the field labour. In the West Indies the planters set the canes out widely, leaving plenty of space for the development of the roots, and the ratoons serve up to from five to twenty years. In the Philippines the setting of cane points is renewed each year, with few exceptions, and the planting is comparatively close.

Bulacan sugar-land, being more exhausted than Pampanga land, will not admit of such close planting, hence Bulacan land can only find nourishment for 14,300 points per acre, whilst Pampanga land takes 17,800 points on average computation.

In Negros, current sugar is raised from new lands (among the best) and from lands which are hardly considered suitable for cane-planting. Good lands are called "new" for three crops in Negros, and during that period the planting is close, to choke the cane and prevent it becoming aqueous by too rapid development.

In the Northern Philippines "clayed" sugar (Spanish, Azucar de pilon) is made. The massecuite, when drawn from the pans, is turned into earthenware conic pots containing about 150 lb. weight. When the mass has set, the pot is placed over a jar (Tagalog, oya) into which the molasses drains. In six months, if allowed to remain over the jar, it will drain about 20 per cent, of its original weight, but it is usually sold before that time, if prices are favourable.

The molasses is sold to the distilleries for making Alcohol, [131] whilst there is a certain demand for it for mixing with the drinking-water given to Philippine ponies, although this custom is now falling into disuse, in Manila at least, because molasses is never given to the American imported horses.

From nine tests which I made with steam machinery, of small capacity, in different places in the northern provinces, without interfering with the customary system of manipulating the cane or the adjustment of the mill rolls, I found the--

Average juice extraction to be 56.37% Average moisture in the megass on leaving the mill 23.27% Average amount of dry megass [132] 20.36% 100.00%

The average density of juice in the cane worked off as above was 10 3/4 deg. Beaume.

In Negros the process is very different. The juice is evaporated in the pan-battery to a higher point of concentration, so that the molasses becomes incorporated with the saccharine grain. It is then turned out into a wooden trough, about 8 feet long by 4 feet wide, and stirred about with shovels, until it has cooled so far as to be unable to form into a solid mass, or lumps. When quite cold, the few lumps visible are pounded, and the whole is packed in grass bags (bayones). Sugar packed in this way is deliverable to shippers, whereas "clayed" sugar can only be sold to the assorters and packers (farderos), who sun-dry it on mats and then bag it after making up the colour and quality to exporter's sample (vide p. 173).

The Labour system in the Northern Philippines is quite distinct from that adopted in the South. The plantations in the North are worked on the co-operative principle (sistema de inquilinos). The landowner divides his estate into tenements (aparcerias), each tenant (aparcero) being provided with a buffalo and agricultural implements to work up the plot, plant, and attend to the cane-growth as if it were his own property. Wherever the native goes to work he carries the indispensable bowie-knife (Tagalog, guloc; Spanish, bolo). When the cutting-season arrives, one tenant at a time brings in his cane to the mill, and when the sugar is worked off, usually one-third, but often as much as one-half of the output, according to arrangement, belongs to the tenant. The tenant provides the hands required for the operations of cane-crushing and sugar-making; the cost of machinery and factory establishment is for the account of the landowner, who also has to take the entire risk of typhoons, inundations, drought, locusts, [133] etc.

During the year, whilst the cane is maturing, the tenants receive advances against their estimated share, some even beyond the real value, so that, in nearly every case, the full crop remains in the hands of the estate-owner. In the general working of the plantation hired day-labour is not required, the tenants, in fact, being regarded, in every sense, as servants of the owner, who employs them for whatever service he may need. Interest at 10 to 12 per cent. per annum is charged upon the advances made in money, rice, stuffs, etc., during the year; and on taking over the tenant's share of output, as against these advances, a rebate on current price of the sugar is often agreed to.

In the South, plantations are worked on the daily-wages system, (sistema de jornal), and the labourer will frequently exact his pay for several weeks in advance. Great vigilance is requisite, and on estates exceeding certain dimensions it is often necessary to subdivide the management, apportioning it off to overseers, or limited partners, called "Axas." Both on European and native owners' estates these axas were often Spaniards. The axas' interest varies on different properties, but, generally speaking, he is either credited with one-third of the product and supplied with necessary capital, or he receives two-thirds of the yield of the land under his care and finds his own working capital for its tilth, whilst the sunk capital in land, machinery, sheds, stores, etc., is for the account of the owner.

In 1877 a British company--the "Yengarie"--was started with a large capital for the purpose of acquiring cane-juice all over the Colony and extracting from it highly-refined sugar. The works, fitted with vacuum-pans and all the latest improvements connected with this class of apparatus, were established at Mandaloyan, about three miles from Manila up the Pasig River. From certain parts of Luzon Island the juice was to be conveyed to the factory in tubes, and the promoter, who visited Cebu Island, proposed to send schooners there fitted with tanks, to bring the defecated liquid to Mandaloyan. The project was an entire failure from the beginning (for the ordinary shareholders at least), and in 1880 the machinery plant was being realized and the company wound up.

The classification of sugar in the South differs from that in the North. In the former market it is ranked as Nos. 0, 1, 2, 3 Superior and Current. For the American market these qualities are blended, to make up what is called "Assorted Sugar," in the proportion of one-eighth of No. 1, two-eighths of No. 2, and five-eighths of No. 3. In the North the quality is determined on the Dutch standard. The New York and London markets fix the prices, which are cabled daily to the foreign merchants in Manila.

From a series of estimates compiled by me I find that to produce 7,000 to 10,000 piculs, the cost laid down in Yloilo would be, say, P2.00 per picul (P32.00 per ton); the smaller the output the larger is the prime cost, and vice-versa.

Fortunes have been made in this Colony in cane-sugar, and until the end of 1883 sugar-planting paid the capitalist and left something to the borrowing planter; now it pays only interest on capital. From the year 1884 the subsidized beet-root sugar manufacturers on the continent of Europe turned out such enormous quantities of this article that the total yield of sugar exceeded the world's requirements. The consequence was that the cane-sugar manufacture declined almost at the same ratio as that of beet-root advanced, as will be seen from the subjoined figures:--

Tons.

The world's production in 1880; cane sugar 3,285,714 The world's production in 1880; beet sugar 1,443,349 ========= 4,729,063

Tons. The world's production in 1887, cane sugar 2,333,004 The world's production in 1887, beet sugar 2,492,610 ========= 4,825,614

Tons. Beet sugar Increase 1,049,261 Cane sugar Decrease 952,710

The world's output was Increased 96,551

Since the above date, however, the output of Beet Sugar has become about double that of Cane Sugar, as will be seen from the following figures, viz.:--

World's Production. Season of 1899-1900. Season of 1900-1901. Tons. Tons.

Cane sugar 2,867,041 3,425,022 Beet sugar 5,607,944 6,096,858 ========= ========= 8,474,985 9,521,880

On estates already established at old prices, cane-sugar production pays an interest on capital, but the capitalist is not necessarily the planter and nominal owner, as has been explained. Since the American occupation the cost of labour, living, material, live-stock, and all that the planter or his estate need, has increased so enormously that the colonist should ponder well before opening up a new estate for cane-growing in world-wide competition. For figures of Sugar Shipments vide Chap, xxxi., "Trade Statistics."

Rice (Oryza) being the staple food of the Filipinos, it is cultivated more or less largely in every province of the Colony. Its market value fluctuates considerably according to the stocks in hand and the season of the year. It appears to be the only branch of agriculture in which the lower classes of natives take a visible pleasure and which they understand thoroughly. In 1897 about 80,000 tons were raised.

The natives measure and sell rice (Tagalog, bigas) and paddy (Tagalog, palay) by the caban and its fractions; the caban dry measure is as follows, viz:--

4 Apatans = 1 Chupa; 8 Chupas = 1 Ganta; 25 Gantas = 1 Caban,

the equivalent of which in English measure is thus, viz:--

1 Atapan = .16875 of a pint. 1 Chupa = .675 of a pint. 1 Ganta = 2 quarts, 1 2/5 pints. 1 Caban = 16 gallons, 3 quarts, 1 pint.

Rice of foreign importation is weighed and quoted by the picul of 133 1/3 lbs. avoirdupois, subdivided as follows, viz.:--

16 Taels = 1 Catty; 10 Catties = 1 Chinanta; 10 Chinantas = 1 Picul.

Thirty years ago rice was exported from the Philippines, but now not even sufficient is produced for home consumption, hence this commodity is imported in large quantities from Siam, Lower Burmah, and Cochin China to supply the deficiency. In 1897 nearly 65,000 tons of rice were brought from those countries, and since the American occupation the annual receipts of foreign rice have increased to fivefold. Sual (Pangasinan), on the Gulf of Lingayen, was, thirty-five years ago, a port of importance, whence rice was shipped to China (vide p. 261). This falling off of rice-production did not, however, imply a loss to the population in Spanish times when imported rice was sold cheaply, because, in many provinces, land formerly used for rice-growing was turned to better account for raising other crops which paid better in a fairly good market.

The natives everywhere continue to employ the primitive method of treating rice-paddy for domestic and local use. The grain is generally husked by them in a large mortar hewn from a block of molave, or other hardwood, in which it is beaten by a pestle. Sometimes two or three men or women with wooden pestles work at the same mortar. This mortar is termed, in Tagalog dialect, Luzon, the name given to the largest island of the group. However, I have seen in the towns of Candava (Pampanga), Pagsanjan (La Laguna), near Calamba in the same province, in Naig (Cavite), in Camarines Province, and a few other places, an attempt to improve upon the current system by employing an ingenious wooden mechanical apparatus worked by buffaloes. It consisted of a vertical shaft on which was keyed a bevel-wheel revolving horizontally and geared into a bevel pinion fixed upon a horizontal shaft. In this shaft were adjusted pins, which, at each revolution, caught the corresponding pins in vertical sliding columns. These columns (five or six)--being thereby raised and allowed to fall of their own weight when the raising-pins had passed on--acted as pounders, or pestles, in the mortars placed below them. Subsequently, notable progress was made in Camarines Province by Spaniards, who, in 1888, employed steam power, whilst in Pagsanjan (La Laguna) animal motive power was substituted by that of steam. Also, near Calamba, in the same province, water power was eventually employed to advantage. In Negros, near the village of Candaguit, there was one small rice-machinery plant worked by steam power, brought by a Spaniard from Valencia in Spain. Presumably it was not a success, as it remained only a short time in use.

Finally the Manila-Dagupan Railway gave a great stimulus to the rice-husking and pearling industry, which was taken up by foreigners. There are now important rice steam-power mills established at Calumpit, Gerona, Moncada, Bayambang, and other places along the line from Calumpit towards Dagupan, which supply large quantities of cleaned rice to Manila and other provinces, where it is invariably more highly appreciated than the imported article. Also, at Nueva Caceres (Camarines), in 1896, a large steam-power rice mill was being worked by Don Manuel Pardo, who had a steamer specially constructed in Hong-Kong for the transport of his output to the provincial markets.

The average yield of cleaned rice from the paddy is 50 per cent., whilst no special use is found for the remaining 50 per cent. of coarse paddy-bran. The fine bran, almost dust (called in Tagalog Tiki Tiki), serves, however, for several purposes on the farm. The rice grain which is broken in the husking is known as Pinaua in Tagalog.

The customary charge for husking and winnowing a caban of paddy is 12 1/2 cents, so that as two cabans of paddy give one caban of rice, the cost of this labour would be 25 cents per caban of rice.

The average amount of rice consumed by a working man per day is estimated at four chupas, or, say, close upon eight cabans per annum, which, on the old reckoning--that is to say in Spanish times, taking an average price of 1 peso per caban of paddy = 2 pesos per caban of rice, plus 25 cents for cleaning = 2.25 pesos per caban of clean rice--amounts to 18 pesos per annum. A native's further necessities are fish, an occasional piece of buffalo, betel-nut, tobacco, six yards of cotton print-stuff, and payment of taxes, all of which (including rice) amounted to say P50 in the year, so that a man earning 20 cents per day during 300 days lived well, provided he had no unforeseen misfortunes. Cock-fighting and gambling of course upset the calculation.

There are, it is said, over 20 different kinds of rice-paddy. These are comprised in two common groups--the one is called Macan rice (Spanish, Arroz de Semillero) which is raised on alluvial soil on the lowlands capable of being flooded conveniently with water, and the other has the general denomination (in Luzon Is.) of Paga or Dumali (Spanish, Arroz de Secano) and is cultivated on high lands and slopes where inundation is impracticable.

The Macan, or low-land rice, is much the finer quality, the grain being usually very white, although Macan rice is to be found containing up to 25 per cent. of red grain, known in Tagalog as Tangi, or Malagcquit. The white grain is that most esteemed. The yield of grain varies according to the quality of the soil. In the north of Bulacan Province the average crop of Macan rice may be taken at 80 cabans of grain for one caban of seed. In the south of the same province the return reaches only one-half of that. In the east of Pampanga Province, in the neighbourhood of Arayat, Magalang, and Candava villages, the yield is still higher, giving, in a good year, as much as 100 cabans for one of seed. In Negros a return of 50 cabans to one may be taken as a fair average.

Paga rice always shows a large proportion of red grain, and the return is, at the most, half that of Macan yield, but whilst rarely more than one crop per annum is obtained from low-lands (Macan rice)--taking the average throughout the Islands--in most places up to three crops of Paga rice can be obtained.

Besides the ordinary agricultural risks to which rice cultivation is exposed, a special danger often presents itself. The Paga rice is frequently attacked by flies (Tagalog, Alutangia), which suck the flower just before seeding, and the person in charge of the plantation has to stroll in the evenings and mornings among the setting to whisk off these insects with a bunch of straws on the end of a stick, or catch them with a net to save the grain. Both Macan and Paga are sometimes damaged by an insect, known in Ilocos Province as Talibatab, which eats through the stalk of the plant before maturity, causing the head, or flower, to droop over and wither, but this does not happen every season.

To plant Macan rice the grain or seed is sown in the month of June on a piece of land called the "seeding-plot," where, in six weeks, it attains a height of about one foot, and, provided the rains have not failed, it is then pulled up by the roots and transplanted, stem by stem, in the flooded fields. Each field is embanked with earth (Tagalog, pilapil) so that the water shall not run off, and just before the setting is commenced, the plough is passed for the last time. Then men, women, and children go into the inundated fields with their bundles of rice-plant and stick the stalks in the soft mud one by one. It would seem a tedious operation, but the natives are so used to it that they quickly cover a large field. In four months from the transplanting the rice is ripe, but as at the end of November there is still a risk of rain falling, the harvest is usually commenced at the end of December, after the grain has hardened and the dry season has fairly set in. If, at such an abnormal period, the rains were to return (and such a thing has been known), the sheaves, which are heaped for about a month to dry, would be greatly exposed to mildew owing to the damp atmosphere. After the heaping--at the end of January--the paddy, still in the straw, is made into stacks (Tagalog, Mandala). In six weeks more the grain is separated from the straw, and this operation has to be concluded before the next wet season begins--say about the end of April. On the Pacific coast (Camarines and Albay), where the seasons are reversed (vide p. 22), rice is planted out in September and reaped in February.

The separation of the grain is effected in several ways. Some beat it out with their feet, others flail it, whilst in Cavite Province it is a common practice to spread the sheaves in a circular enclosure within which a number of ponies and foals are trotted.

In Negros Island there is what is termed Ami rice--a small crop which spontaneously rises in succession to the regular crop after the first ploughing.

It seldom happens that a "seeding-plot" has to be allowed to run to seed for want of rain for transplanting, but in such an event it is said to yield at the most tenfold.

Nothing in Nature is more lovely than a valley of green half-ripened rice-paddy, surrounded by verdant hills. Rice harvest-time is a lively one among the poor tenants in Luzon, who, as a rule, are practically the landowner's partners working for half the crop, against which they receive advances during the year. Therefore, cost of labour may be taken at 50 per cent. plus 10 per cent. stolen from the owner's share.

Paddy-planting is not a lucrative commercial undertaking, and few take it up on a large scale. None of the large millers employing steam power are, at the same time, grain cultivators. There is this advantage about the business, that the grower is less likely to be confronted with the labour difficulty, for the work of planting out and gathering in the crop is, to the native and his family, a congenial occupation. Rice-cultivation is, indeed, such a poor business for the capitalist that perhaps a fortune has never been made in that sole occupation, but it gives a sufficient return to the actual tiller of his own land. The native woman is often quite as clever as her husband in managing the estate hands, for her tongue is usually as effective as his rattan. I venture to say there are not six white men living who, without Philippine wives, have made fortunes solely in agriculture in these Islands.