B 1,343,543 47 N~ fi:. i/w k!.::,. - .UR 1/ -s /,2 ' ft JUN 10 1924 r PHILIPPINE LOCAL AUTONOMY HEARINGS BEFORE THE CCOMMITTEE ON INSULAR AFFAIRS, HOUSE OF REPRESENTATIVES SIXTY-EIGHTH CONGRESS FIRST SESSION ON H. R. 8856 A BILL TO ENABLE THE PEOPLE OF THE PHILIPPINE ISLANDS TO ADOPT A CONSTITUTION AND FORM A GOVERNMENT FOR THE PHILIPPINE ISLANDS AND TO PROVIDE FOR THE FUTUTR POLITICAL STATUS OF THE SAME. APRIL 30, MAY 1, 2, 3, 5, AND 6, 1924 Printed for the use of the Committee on Insular Affairs WASHINGTON GOVERNMENT PRINTING OFFICE 1924 101093 COMMITTEE ON INSULAR AFFAIRS HOUSE OF REPRESENTATIVES SIXTY-EIGHTH CONGRESS LOUIS W. FAIRFIELD, Indiana, Cmp l?1an. CHARLES E. FULLER, Illinois. FREDERICK N. ZIHLMAN, Maryland. HAROLD KNUTSON, Minnesota. EDGAR R. KIESS, Pennsylvania. CARROLL L. BEEDY, Maine. JAMES H. MACLAFFERTY, California. GRANT M. HUDSON, Michigan. GEORGE F. BRUMM,. Pennsylvania. JOHN C. SCHAFER, Wisconsin. FREDERICK G. FLEETWOOD,, Vermont. T. J. B. ROBINSON, Iowa. CHRISTOPHER D. SULLIVAN, New York. HALLETT S. WARD, North Carolina. GUINN WILLIAMS, Texas. JACOB L. MILLIGAN, Missouri. FRANK GARDNER, Indiana. W. C. SALMON, Tennessee. HEARTSILL RAGON, Arkansas. T. WEBBER WILSON, Mississippi. EVERETT KENT, Pennsylvania. FELIX CORDOVA DAVILA, Porto Rico. M. F. BROWN, Clerk II Ft^,PPi X AU TOtOY/.4I INCA A4-;NY PHILIPPINE LOCAL AUTONOMY COMMITTEE ON INSULAR AFFAIRS, HOUSE OF REPRESENTATIVES, Wednesday, April 30, 1924. The committee this day met, Hon. Louis W. Fairfield (chairman) presiding. The CHAIRMAN. Without objection, gentlemen of the committee, we will proceed with the hearing. I want to express first to the committee my appreciation of your courtesy in granting this hearing- at this time, after having had under consideration the other bill for so long a period. Mr. KENT. I did not look very closely at the notice, Mr. Chairman. My secretary advised me of-the meeting, and did not advise me of the purpose of the meeting. Are we to go ahead with the previous consideration? The CHAIRMAN. To-day the hearing is on my bill. I have prepared a brief statement: which I care' to make to the committee, so that I may not occupy any more time than is absolutely necessary; and at my request we have present with uS to-day a representative of the Philippine-American Chambe'r of Commerce. I requested the president'of that association' to appear before us, and there is also present the president of' the Manila Electric Co. I found upon investigation that there had not appeared before the committee at any time during our hearing any representative of the business interests in the Philippines, aid personally I felt that fairness in the consideration, so far as the committee was concerned, in securing an adequate knowledge of the situation over there, before action was taken, was eminently proper. So these gentlemen are here to-day at my request. I want the committee to understand that. Legislation upon the subject of the Philippine Islands is so important in character and carries with it such far-reaching effects as to challenge the most thoughtful and considerate action. It is well, perhaps, to briefly state the magnitude of the question: further. it might be well to have in definite form some statement as to how far we have come on the road upon which we started when we toolk over the Philippines. This legislation, gentlemen, has to do with an area' of 115.00() square miles, an archipelago of 7,083 islands. The' distance from.' ) north to south is 1,152 miles, and from east to west 682 miles. AMny " of these islands are, of course, of inconsiderable size, but a numlber of them are as large as some of the States in the Union. Legislating for such an area of the world's surface in any part ' of the world would carry with it the gravest consideration of all. the problems involved. Included in this area is a;population of.....^~~~~~~~~~~~~~~~~.. -. "; 1 2 PHI]LIPPINE LOCAL AUTONOMY, sligitliy in excess of i1l,i)00,((00. Fifty per cent of the population above the age of 10 years are illiterate. One million and a half in round numbers are able to speak one language, English. Eiglit lllndred thousand in round numbers are able to speak Spanish. There are 9,000,000 people who speak 87 dialects. Unity of language is essential to national security. In the last quarter of a century, through the efforts of the United States in upbuilding the schools, a greater number of people in the islands speak the same langlage than in 300) years of Spanisl rule. But the task is vet to be finished. It would seem that at least another quarter of a century would be necessary to make the people able to converse with each other throughout the Philippines. The evolution and the unification of any people into a homogeneous body politic is not accomplished within a single generation. Those of us who are at all familiar with the processes in the evolution of human society know that, starting where we did, it was an impossible task to have done by this time the work which we had in mind at the beginning. Wonderful progress has been made. Marvelous things have been done, which reflects great praise upon the Filipino people. They have shown a marvelous adaptation and a keen, discriminating sense of the spirit and character of the institutions of the Great Republic. Yet, thoroughly convinced, as I am, that we have not yet accomplished what we should accomplish in the interest of the Philippine people, before we make them wholly independent, I have earnestly sought to study the whole problem and to secure such legislation as will be progressive, in line with the very things we have been doing, and that I hope may meet the approbation of the Filipinos themselves. This country has not exploited the Philippines, nor permitted their natural resources to be exploited by predatory interests. Ninety-six per cent of the farms are owned by Filipinos. Ninetyone per cent of the urban property is owned by the Filipinos. Seventy-three million two hundred and fourteen thousand seven hundred and forty-two acres of public lands are held in reserve for the Filipino people. The limit of sale to corporations is 2,530 acres, and 247 acres to individuals. There is yet about 65,000 square miles of virgin forests, 99 per cent of which belongs to the Philippine Government. If the government of backward peoples is a sacred trust, as has often been said, then the United States has gone further than any other power in the world to carry that principle of trusteeship into effect. An orderly government has been established and maintained in a part of the world where, with the exception of one great power, disorder is the rule. The Filipinos have developed a national life and are rapidly proving to the world that they are capable of self-government. It might be well to state what has been said by leading men in authoritative positions concerning what should be our attitude toward the Philippines. In 1900 Mr. McKinley stated in his instructions to the American Commission to the Philippines that the American policy "is not for our satisfaction or for the experiment of our theoretical views, but for the happiness, peace, and prosperity of the Filipinos themselvp " PHILIPPINE LOCAL, AUTONOMY 3 Fifteen per cent of the annual revenues of the islands are expended on public instruction. The colonies of other countries spend from 2 to 4 per cent. More and more reliance has come to be placed upon Filipino teachers. and tile num-niber of foreign teachers has:een diminishing with each successive year. Thus far the Government of the United States has conserved the resources of the Filipino people to the development of their own best interests. What of our stewardship as to the governmental policies? Elihu Root in the Republican convention of 190)4 s'tated thalt tie Philippines might eventually be given some status such as Cuba. Dr. J. G. Sherman, president of the first commission to the Philippines, said that American policies in the Philippines would " issue in independence." In 1908 President Roosevelt expressed the hope that within a; generation the Philippines would " decide for themselves whether it; is well for them to become independent." President Taft also stated that the very policy which the Americans were pursuing must " logically reduce and finally end the sovereignty of the United States." In 1913 President Wilson made the statement "Every step we take will be taken with the view to the ultimate independence of the islands." In 1916, the preamble to the Jones Act declared, " It was never the intention of the United States in the incipiency of the war with Spain to make it a war of conquest or for territorial aggrandizement." It is as it has always been the purpose of the United States to withdraw their sovereignty over the Philippine Islands, and to recognize their independence as soon as a stable government can be established. Perhaps there is more indefiniteness in that statement concerning a stable government than any possible statement that could have been put into the preamble. In June, of 1922, President Harding stated that "Whether wisely or not, our disavowal of permanent retention was made in the very beginning, and a reversal of that attitude will come, if ever, only at vyour request." Theodore Roosevelt said in 1915, "We can not taint our work in the Philippines with bad faith." In June of 1922, President Harding promised the Philippines, "No backward step is contemplated. no diminution of your domestic control is to be sought." There has never been from any representative man in government a statement at variance with the conception that ultimately freedom should be granted to the Philippines, if they should so desire. These promises have not been empty words. The Jones Act of 1916 established a representative legislature. When that was considered the Clark amendment to the Jones Act provided for independence within four years was defeated. This would indicate that the framers of the bill which is the present government of the Philippines contemplated neither the issue of self-government nor independence immediately. This simple statement of the salient features involved in the legislation brings us to the situation as it is to-day. I am free to confess 4 PHILIPPINE LOCAL AUTONOMY that matters are not now satisfactory in the Philippine Islands. Whoever may be at fault, the system inaugurated under the Jones Act lIas proven to be inadequate. There remains one of three things to be done. First, we may refuse to alter existing conditions and insist that matters go on under the system established by the Jones law. Were that acquiesced in by the Filipino people and the people of the United States, in my judgment it would be a most happy solution, but unfoirtunately there is very grave disagreement as to the ad(:inistra.tion of the Jones Act. and for tlhat reason there has a contention arisen which would seem to indicate that some change shouldt be made.,ec-i(dc we may initiate legislation to so modify the Jones law a:s to nmake the representative assembly subordinate itself to the judgltmelnt t of the governor. My own judgment is that neither of the preceding is a practicable solution of the present situation. T'lird. In line with the gradual movement toward future independlence we nimay enact a law granting further autonomy, but by its provisions removing the occasion which gives rise to friction between, t}he adilministrative office and the legislature. In conformity w ith tlti idla lha the ipresent status is neither wise nor profitable and ipo(ssiblf froug!:t -with danger, I have introduced a bill. House Resolution l8856. kWithout taki)g' time to explain in detail the provisions of this ati. I may say in general way that it provides for the election of a (:overnor General by the Filipino people. This would make a gover-nment elected by the people of the Philippine Islands supreme in (ontrol of all matters, primarily domestic. Their natural resources xwoul(l:be completely under the control of the Filipino people to be (leveloped in their own interest. There are three questions of vital interest to the stability of any government. First, the currency: second, the bonded indebtedness: third, its fo rei-gn relations. In this bill complete autonomy is given to the Philippines in matters that are purely domestic. The bill provides for a r'esident commissioner without power to veto any measure that nmihlt bte passed by the Philippine Legislature. AM. SCHA}FER. Does not that bill provide that that resident commilo.-ioner cn stop legislation and practically kill it until the President acts on it? Mr. BEEDY. Will you start that over again, Mr. Chairman? The CHrAAIRAN. In this bill complete autonony is given to the Philippines in matters that are purely domestic. The bill provides for a. Resident Commlissioner without power to veto any measure that might be passed by the Philippine Legislature. If. however. in his ijudgment, any measure passed by the Legislature would deplete the reserve for the redemption of currency, or increase the bonded indebtedness of the Philippines beyond what the government would be able to properly meet, or involve themselves or the United St ates in international difficulties, then he is empowered by the terms of this bill to suspend the going into effect or the operation of the law until the matter can be referred to the President of the United States. lThat is the provision, Mr. Schafer, to which you refer. PHILIPPINE LOCAL AUTONOMY 5 If the President approves the law it will go into effect or continue in operation. If he should disapprove, it is equivalent to a veto and the law will cease to be effective. Without reflecting in any way upon any administrative officer of the United States, you can easily see that where such officer is brought constantly into contact with local legislation upon which he must pass. And it is well to consider the fact, that the Governor General must sign every bill before it becomes a law. His judgment upon every bill is exacted, and he must pass either favorably or unfavorably, having no choice. In any such situation as that, there will of necessity be an opportunity for friction between the administration and the Legislature. An elected governor holds his office by the will of the people, and is supported by the political party that brought him into power. There would be much less occasion for any complication over a measure that the Legislature might pass. This is what the bill which I introduced would make possible. There may be some parts of it that need modification. It may be that the time set for the plebiscite, 30 years, is too long in the minds of the members of the committee, but I feel that the salient features of the bill ought to demand our most careful consideration in connection with the solution of this problem. Now, as to the provisions for the plebiscite. Upon this I have a very firm conviction. No other bill, so far as I know, has been introduced that gives to the Philippine people the opportunity to remain under the flag. It may be that they will choose to do so. After having had charge of their affairs for so many years, and having the assurance from them on every occasion that the Government of the United States has been a blessing to that peqple, it is but fair to assume that possibly with further study and larger experience in the end thev would desire to remain a part of the great Republic. Personally, I am unwilling to report any legislation that would peremptorily divorce them from the possibility of remaining with us should they desire to do so. My own conception, gentlemen, is that this great country ought, in the spirit in which we undertook to develop the Philippines. say to that people, " Gradually we have moved forward at every step in legislative process, if there should come a time before final dissolution of our relations, that you think your interests for the future would be better conserved by holding your relations politically and economically with the great Republic, then we shall welcome you as a permanent part of our territory." On the other hand, that decision should be left, without coercion, without restraint, without any attempt on our part to determine it. Now, then, I firmly believe that 25 years is too short a period in which to have accomplished what we set out to accomplish, because I believe that the task is not yet done. I am constrained to urge further autonomy with large experience in self-government as a prerequisite to the granting to them of independence, or the exercise of plebiscites to remain under the flag. My own conviction is that the membership of this committee are sincerely anxious to do the right thing. Thoroughly alive to the vast importance of the measure which we shall initiate, I certainly thank you for your consideration of this 6 PHILIPPfINE LOCAL AUTONOMY bill, and shall hope that in connection with other measures which we have been discussing you will give it your full and careful consideration. Now, gentlemen, I will introduce to you Mr. Pardee, of the American Philippine Chamber of Commerce. who desires to make a statement. I hoped that Mr. Sweitzer, with whom I have had some conferences. might be with us, with a fuller prepared statement, but before we proceed with that I want to ask immediately following my own remarks that the following message be incorporated as a part of this hearing, the statement of President Harding to the Philippine Commission in 1922, the statement of Mr. Coolidge. the letter addressed to Mr. Roxas, chairman of the Independence Conmmission, February 21, 1924, and also a cablegram from Governor General Wood, whitc was released for publication on April 1I. 1924. I want to ask the committee to permit that to go in as a part of the hearing. Mr. WILLIAMS. What is the date of that telegram from the Governor General? The CHAIRMAN. This was released on April 15. The date on it is March 14. The first knowledge that I had of that was when I saw it. in the newspaper. Mr. MILLIGAN. You have not included in there that part of the message of December, 1920, of President Wilson to Congress relating to the Philippines? The CHAIRMAN. I have not, but I would not object to have it in the hearing. Mr. SCHAFER. The reply of the Filipinos directing the President's attention to General Wood's telegram, the release that Secretary Weeks put out, and he released it on the same day when we moved to adjourn to take up the matter of deciding as to whether to report the Philippine bill out, and I think that the reply to the President from the Philippines should be incorporated in the record. The CHAIRMAN. I would say, Mr. Schafer, that Mr. Roxas is here, and if he wants to incorporate that into the record, I would have no objection. Mr. RoXAs. That is my desire, sir. The CHAIRMAN. All right. You will furnish a copy of it. Mr. RoxAS. Yes, sir. (The papers offered by the chairman are as follows:) W~A;R DEPARTMENT, April 15.. 192.-. The Secretary of War authorizes publication of the following: In a cablegram of March 14. 1924, from Governor General Wood lie says the following with reference to the present agitation for Philippine independlence: "I sympathize deeply with the desire of the Filipino people for independence. but know they are not yet prepared to assume its responsibility either from the standpoint of instructed public opinion, preparedness for defense, a common language, or economic resources. I am convinced that the President's letter to Speaker Roxas voices the true interests of the Filipino people and indicates the sound, sane, humane policy which should be followed. The present organic act with certain amendments is adequate to carry out this policy until such time as the final relations which are to exist between the United States and the people of the Philippine Islands may be determined. PHILIPPINE LOCAL AUTONOMY 7 "To grant immediate independence would be a heartless betrayal of our trust and result in turning over the 12.000.000 people of these islands to strife and disorder in the near future. for it would result in almost immediate serious clashes between the Moros arid Christian Filipinos, the former being a unit against independence and desiring the continuance of American sovereignty. It would defeat true independence, both economic and political, ruin the sugar and tobacco industries, destroy confidence in investments, with resultant wrecking of the finances of the islands with attendant idleness and disorder. It would be a serious blow to western civilization and to the Christian effort in the Far East, and render unavailing or destroy much of our work here. "I am convinced the true situation in the Phillippines is not understood?ither by Congress or the American people, who have been misinformed andi deceived by misleading propaganda and information which has been circulated by the Independence Mission, Press Bureau, and others, and I urge that the fullest opportunity for a hearing be given to those who have lived here long years, have had wide experience, and are thoroughly familiar with existing conditions. The people are contented and public order is excellent except for occasional clashes in the Moro country and disturbances arising from fanatical religious outbreaks against the authorities, such as the recent Colorum disturbances. I am convinced that the people as a whole in their hearts appreciate the benefits which have come to them under our flag and that our government here is conducted for their best interests. In the two and half years I have been here as Governor General, I have received but one petition from the people on the subject of independence, and during all this so-called crisis, during which agitators, and I am sorry to say some of' the leaders, have tried to line up the Filipinos against the Government and representative of the United States. I have not received a single signed or unsigned communication of an unfriendly character from any of the 12,000,000 inhabitants of the islands. This tells the story. The bulk of the people want indepence at some future time and, generally speaking, under our protection" Those who understand the present conditions know that they are not yet ready for independence. This most of the political leaders, indeed all theprominent ones, have admitted to me, some of them repeatedly and very recently, but they admit freely that a considerable number of years will berequired before the people will be prepared for independence, either from a standpoint of national defense or resources. They all labor under the impression that whatever trouble they may get into, troubles which are certain to occur with neighboring powers, due to racial immigration, and other problems, we will come to their assistance, and they do not realize that once we leavehere we can not return. I am sure that once the actual conditions are known to the American people and to Congress, it will not be the policy of either to abandon these people until they are prepared to maintain a stable government and meet the obligations of an independent national existence. Agitators and disseminators of false and misleading propaganda have thus far very largely had the floor, and with the exception of statements contained in the letter of the President, and those of the Secretary of War, and a few others, the American people have been misled and befuddled as to Philippine conditions and sentiments towards the United States. We should go ahead courageously, patiently, and kindly in the discharge of our clear duty to these people and to the world. No greater or more brutal injustice could be done:hese people than to abandon them under the guise of granting them immediateindependence when they are not ready for it, and I am convinced that such procedure would in the end be not only destructive to Philippine hopes and aspirations but most unfortunate to those responsible for such a policy, once the American people understand the real conditions and see the results of such a policy. We have put our hands to the plow, and this is not the time to turn back. "We must not be swept off our feet by the purely local and artificial agitation produced by a small group fanning the very natural desire of the people for independence, but by failing to enlighten them as to existing conditions or the costs and responsibilities which independence involves. Most of the serious defects pointed out by the Wood-Forbes report are in process of being corrected but with great difficulties, and will require years for accomplishment, such as development of natural resources and preparation for economic independence and preparation for national defense and the building up of individual 8 PHILIPPINE LOCAL AUTONOMY civic courage. The people are too often afraid to express themselves openly and frankly. "In conclusion, as I see it, the responsibility rests squarely upon us to continue our work here until we ourselves are satisfied these people are prepared to maintain an independent national existence." PRESIDENT COOLIDGE'S REPLY TO THE PILIPIPINE INI)EPENDENCE MISSION The President's letter is as follows: THE WHITE HOUSE, Washington. February 21, 1924. MY DEAnR MR. ROXAS: The resolutions adopted by the Senate and House of Representatives of the Philippines, touching upon the relations between the Filipino people and the Government of the United States, have been received. I have noted carefully all that you have said regarding the history of these relations. I have sought to inform myself so thoroughly as might be as to the occasions of current irritation between the Legislature of the Philippines and the executive authority of the islands. In your presentment you have set forth more or less definitely a series of grievances, the gravamen of which is that the present executive authority of the islands, designated by the United States Government, is, in your opinion, out of sympathy with the reasonable national aspirations of the Filipino people. If I do not misinterpret your protest, you are disposed to doubt whether your people may reasonably expect. if the present executive policy shall continue. that the Government of the United States will in reasonable time justify the hopes which your people entertain of ultimate independente. The declaration of the commission of independence charges the Governor General with illegal, arbitrary, and undemocratic policies, in consequence of which the leaders of Filipino participation in the government have resigned and their resignations have been accepted by the Governor General. The commission of independence declares that it is necessary "to take all needful steps and to make use of all lawful means within our po)wer to obtain the complete vindication of the liberties of the country now violated and invaded." It proceeds, "And we declare, finally, that this event, grave and serious as it is, once more demonstrates that the immediate and absolute independence of the Philippines, which the whole country demands. is the only complete and satisfactory settlement of the Philippine problem." It is occasion for satisfaction to all concerned that this declaration is couched in terms of moderation. and that it goes no further than to invoke "all lawful means within our power." So long as such discussions as this shall be confined to the consideration of lawful means there will be reason to anticipate naturally beneficent conclusions. It is therefore a matter of congratulation, which I herewith extend, that you have chosen to carry on this discussion within the bounds of lawful claims and means. That you have thus declared the purpose to restrict your modes of appeal and methods of enforcing it is gratifying evidence of the progress which the Filipino people. under American auspices, have made toward a demonstrated capacity for self-government. The extent to which the grievances which you suggest arle shared by the Filipino people has been a subject of some disagreement. The American (Government has information which justifies it in the confidence that a very large proportion, at any rate, arid possibly a majority, of the substantial citizenry of the islands does not support the claim that there are grounds for serious grievance. A considerable section of the Filipino people is further of the opinion that at this time any change which would weaken the tie between the Filipinos and the Americaln Naztion would be a misfortune to the islao-ds. The world is in a state of high tension and unsettlement. The possibility of either economic or political disorders, calculated to bring misfortune, if not disaster, to the Filipino people, unless they are strongly supported, is not to be ignored. It should not be overlooked that within the past two years, as a result of international arrangements negotiated by the Washington Conference on Limitation of Armament and Problems of the Far East, the position of the Filipino people has been greatly improved a)nd assured. For the stabilizing advantages which accrue to them in virtue at the assurance of peace in the Pacific, they are directly indebted to the initiative and efforts of the American Government. PHILIPPINE LOCAL AUTONOMY 9 They can ill afford in a time of so much uncertainty in the world to underrate the value of these contributions to their security. By reason of their assurance against attack by any power; by reason, also, of that financial and economic strength which inevitably accrues to them by reason of the expanded and still expanding opportunities for industrial and economic development; because of all these considerations, the Filipino people would do well to consider most carefully the value of their intimate association with the American Nation. Although they have made wonderful advances in the last quarter century, the Filipino people are by no means equipped, either in wealth or experience, to undertake the heavy burden which would be imposed upon them with political independence. Their position in the world is such that without American protection there would be the unrestricted temptation to maintain an extensive and costly diplomatic service and an ineffective but costly military and naval service. It is doubted whether with the utmost exertion, the most complete solidarity among themselves, the most unqualified and devoted patriotism, it would be possible for the people of the islands to mainitain aTn idependent place in the world for an indefinite future. In presenting these considerations, it is perhaps worth while to draw your attention to the conditions in which some other peoples find themselves by reason of lacking such guaranties and assurances as the Filipino people enjoy. The burdens of armament and of governmental expenses, which many small nations are compelled to bear in these times, are so great that we see everywhere the evidence of national prosprity and community progress hindered, if not destroyed, because of them. During the World War the Filipino people were comparatively undisturbed in their ordinary pursuits, left free to continue their fine progress. But it may well be doubted whether, if they hall been shorn of the protection afforded by the United States, they could have enjoyed so fortunate an experience. Much more probably they would have become involved in the great conflict and their independence and nationality would have become, as did those of many other peoples, pawns in the great world reorganization. There could be no more unfortunate posture in which to place a people such as your own. You have set your feet firmly in the path of advancement and improvement. But you need, above all else, assured opportunity of continuing in that course without interference from the outside or turmoil within. Working out the highest destiny of even the most talented and advanced of peoples is a matter of many generations. A fair appraisal of all these considerations, and of others, whicih suggest themselves without requiring enumeration, will, I am sure, justify the frank statement that the Government of the United States would not feel that it liad performed its full duty by the Filipino people or discharged all of its obligations to civilization if it should yield at this time to your aspiration for national independence. The present relationship between the American Nation and the Filipino people arose out of a strange, an almost unparalleled, turn of international affairs. A great responsibility came unsought to the American people. It was not imposed upon them because they had yielded to any designs of imperialism or of colonial expansion. The fortunes of war brought American power to your islands, playing the part of an unexpected and a welcome deliverer. You may be very sure that the American people have never entertained purpose of exploiting the Filipino people or their country. There have, indeed, been different opinions among our own people as to the precisely proper relationship with the Filipinos. There are some among us, as there are some among your people, who believe that immediate independence of the Philippines would be best for both. I should be less than candid with you, however, if I did not say that, in my judgment, the strongest argument that has been used in the United States in support of immediate independence of the Philippines is not the argument that it' would benefit the Filipinos but that it would advantage the United States. Feeling as I do, and as I convinced the great majority of Americans do regarding our obligations to the Filipino people, I have to say that I regard such arguments as unworthy. The American people will not evade or repudiate the responsibility they have assumed in this matter. The American Government is convinced that it has the overwhelming support of the American Nation in its conviction that present independence would be a misfortune and might easily become a disaster to the Filipino people. Upon that conviction the policy of this Government is based. Thus far I have suggested only some of the reasons related to international concerns which seem to me to urge strongly against independence at this 10 PHB11TP-PTINE,. liAL _ AVT —0 —NOMY time. I wish now to review for a moment some dlomestic coilcerns } of the Philippine Islands, which seem also to argue against present independe nce. The American Government has been most liberal in opening to the Filipino people the opportunities of the largest practicable participati on inl and control of their own 'dministration. It ha:, been a mantter of pride and sattisfaction to us. as I tam sure it must also have been to y'ur people. tli.tt tl:is attitude thas ntet with so fine a response. In education. in cultlurl advl cement, in political conceptions. and institutional developmen t, the 1"iliniilll people have demonstrated a capmacity which can not but justify high hopes for their future. But it would he idle and insincere to suggest that tltshey inve yet proved their possession of the completely developed political cal(pacity which is necessary to a minor nation assumiing the full responsibility of m aintaining itself in the family of nations. I am frankly convinced that the very mission upon which you have addressed me is itself an evidence that something is yet lacking in development of political consciousness and capability. One who examines the grounds on which are based the protests against the present situation is forced to conclude that there has not been, thus far a full realization of the fundamental ideals of democratic-republican government. There have been evidences of a certain inability, or unwillingness, to recognize that this type of governmental organization rests upon the theory of complete separation of the legislative, executve. and judicial functions. There have been many evidences of disposition to extend the functions of the legislature. and thereby to curtail the proper authority of the executive. It has been charged that the present Governor General has in some matters exceeded his proper authority; but an examination of the facts seems rather to sul)port the charge that the legislative branch of the insular government has been the real offender through seeking to extend its own authority into some areas of what should properly be the executive realm. The Government of the United States has full confidence in the ability. good intentions, fairness, and sincerity of the present Governor General. It is convinced that he has intended to act and has acted within the scope of his proper and constitutional authority. Thus convinced, it is determined to sustain him; and its purpose will be to encourage the broadest and most intelligent cooperation of the Filipino people in this policy. Looking at the whole situation fairly and impartially one can not but feel that if the Filipino people can not cooperate in the support and encouragement of as good an administration as has been afforded under Governor General Wood, their failure will be rather a testimony of unpreparedness for the full obligations of citizenship than an evidence of patriotic eagerness to advance their country. I am convinced that Governor General Wood has at no time been other than a hard-wording, painstaking, and conscientious administrator. I have found no evidence that he has exceeded his proper authority, or that he has acted with any other than the purpose of best serving the real interest of the Filipino people. Thus believing, I feel that I am serving these same interests by saying frankly that it is not possible to consider the extension of a larger measure of autonomy to the Filipino people until they shall have demonstrated a readiness and capacity to cooperate fully and effectively with the American Government and authorities. For such cooperation I earnestly appeal to every friend of the islands and their people. I feel all confidence that, in the measure in which it shall be extended. the American Government will be disposed to grant in increasing degree the aspirations of your people. Nothing could more regretably affect the relations of the two peoples than that the Filipinos commit themselves to a program calculated to inspire the fear that possibly the governmental concessions already made have been in any measure premature. In conclusion, let me say that I have given careful and somewhat extended consideration to the representation you have laid before me. I have sought counsel of a large number of men whom I deem able to give the best advice. Particularly, I have had in mind always that the American Nation could not entertain the purpose of holding any other people in a position of vassalage. In accepting the obligations which came to them with the sovereignty of the Phlippine Islands the American people had only the wish to serve. advance, and improve the condition of the Filipino people. That thought has been uppermost in every American determination concerning the islands. You may be sure that it will continue the dominating factor in the American considera PHILIPPINE LOCAL AUTONOMY 11 tion of the many problems which must inevitably grow out of such relationship as exists. In any survey of the history of the islands ii the last quarter century I think the conclusion inescapable that the Filipino people, not the people of the United States, have been the gainers. It is not possible to believe that the American people would wish otherwise to continue their responsibility in regard to the sovereignty and administration of the islands. It is not conceivable that they would desire, merely because they possessed the power to continue exercising any measure of authority over a people who could better govern themselves on a basis of complete independence. If the time comes when it is apparent that independence would be better for the people of the Philippines from the point of view of both their domestic concerns and their status in the world, and if when that time comes the Filipino people desire complete independence, it is not possible to doubt that the American Government and people will gladly accord it. Frankly, it is not felt that that time has come. It is felt that in the present state of world relationship the American Government owes an obligation to continue extending a protecting arm to the people of these islands. It is felt also that, quite aside from this consideration, there remain to be achieved by the Filipino people many greater advances on the road to education, culture, economic, and political capacity before they should undertake the full responsibility for their administration. The American Government will assuredly cooperate in every way to encourage and inspire the full measure -of progress which still seems a necessary preliminary to independence. Yours very truly, CALVIN COOLIDGE. Hon. MANUEL ROXAS, Chairman the Philippine Mission, 2034 Twentieth Street, Washington, D, C. REPLY OF THE PRESIDENT TO THE PHILIPPINE PARLIAMENTARY MISSION THE WHITE HOUSE, June 22, 1922. GENTLErMEN OF THE MISSION: I heard with deep interest and have read -with full deliberation the petition which you delivered to me through Mr. Quezon a few days ago. I must express my full and grateful appreciation of.your utterances of loyalty and your confidence in the American people. I hope -:the travels of your mission and your contacts with both official and private life have persuaded you that the people of the United States believe in that loyalty no less than you avow it. And I trust this mutuality of confidence,and esteem will abide for all time, no matter what limitations of governments are attached to our relationship. The Philippine people and those of the United States ventured together upon a great experiment in human progress. 'Since you yourselves, in your petition, have so heartily and officially testified to its success, quite as we have been glad to believe, I am well persuaded that our intimate experience has established our cordial relations and our ties of friendship for all time to come. No fixed intent, no thought of conauest. no individual or governmental design to exploit, no desire to colonize, brought us together. It was the revolution of the fates, wherein our assault against oppression at our very doors carried our warfare to yours, far away, and your liberation attended. No American statesman had preconceived expansion to the Orient, no Ameri*can industrial or commercial interests were urging the planting of the flag:and our responsibility in distant lands. The fortunes of war revealed us to one another, and held us as your sponsors before the world. From the day that tranquillity and stability were established in the islands the question of the future of the Philippines has been a matter of political -discussion in the United States as well as in the islands, though from a different viewpoint. Here in the States the early opposition was against socalled "militarism and imperialism." When the issue was made paramount:the American people gave sanction to the Government policy inaugurated by President McKinley, continued by President Roosevelt, and supported by President Taft. The question was not brought to the front in the general elections of 1912.:but the party called to power under President Wilson had adhered to its op 12 PHILIPPINE LOCAL AUTONOMY position to the then existing Philippine policy. In its platform it condemned our friendly experiment as "an inexcusable blunder. which has involved us in enormous expense and brought us weakness instead of strength." I refer to the declaration in order to have you better understand the later congressional action, which resulted in the organic act of 1916, known as the Jones law. It was my fortune to serve as a Member of the Senate when this act was under consideration, and I recall distinctly the varying constructions of the preamble. The progress made toward self-government in that act is not to be challenged, and I think there is no American authority, in Congress or out. suggesting any backward course. The act is not under consideration. But. since you refer freely to the express or implied pledge in that preamble, and call to my attention the passing of a year and a quarter of this administration without a step toward the full bestowal of independence, I remind you that at the time of passage of the act the then senior Senator from Arkansas proposed an amendment which provided for immediate independence. He had been a witness to party declarations and had encountered the conflicting opinion. With fine frankness his amendment provided that "the President is hereby authorized and directed to withdraw and surrender all right of possession, supervision, jurisdiction. control, or sovereignty now existing and exercised by the United States in and over the Territory and people of the Philippines, and he shall on behalf of the United States fully recognize the independence of the said Philippines as a separate and self-governing nation and acknowledge the authority and control over the same of the government instituted by the people thereof." The moment was at hand for definite, decisise action. iandt the resulting grant of complete and unconditional independence. Mainifestly the majority in Cingresis did not believe in Philippine readiness, because the amendmllent was rejected by the responsible majority, and no steps later were taken to hasten the grant of independence until the closing d lys of the s.nmie Idn;i ii:stration, -1whe it Nwas about to lay,aside its responsibility. Without desire to invite contention I recall these things to your mind, because independence has l played a large part in the politics of your country andl ours, tnd in the appraisal of ur relh;tionship it is well for your peol)le to know slomethig of our politics, even is we ought fully to know yours. I can only colmmend the Philippine aspirations to indepetndence and complete self-sovereignty. None in America would wish you to be without national nispirations. You would be unfitted for the solemn duties oi self-gnivernllment without them. It is fair to assume that our only difference of qopinion- relates to the time for independence. You crave it now, and I do not believe the time * has arrived for the final decision. Ma;nifestly. so far as expression,has been made, the maijority of Philippile citizenship prefers severence and self-sovereignty. There are, howevxer, mally among you of differing opinion. There are petitions against independence. Our missions' of investigation pay unstinted tribute to your progress an'd commnend your institutions. Nothing apart from our achievement at home s more pleasing to the United States than the splendid advanceme-nt of the Philippine people. Your progress is without parallel anywhere in the world. From a people wnho began with little freedom and none of responsibility, in a little more than half of one generation you have progressed notably toward self-relial ce a;nd self-government. LAnd you have done it in spite of that lack of ilndependence concerning which you petition. To the United States comes both gratification for your c(conpllishllent ani( justification for this Government's attitude, because you have lmade this record under our sponsorship and in the very atmosphere of the highest freedom in the world. I know of no parallel relationship. We have given substanltially everything we -had to bestow and1 have askled only mutuality tan-i trust in rfeturn. We have extended your control in ~overnment until little '1emiillns but tl.executive authority, without which we could not assume our responsibility. It is not possible for me as Executive definitely to proclaim 'an A1Xerictnl, policy. for the decision must ever be that of Congress, but I would be less thai! { c(andid and fair if I did not tell you we can assume no respionsibilt Iithy ithut t!hal authority. No other instance of bestowing or recognizing independent government ioffers comparison. There is no other' instance comparable to our relationship. Our interests are mutual under existing conditions. There is no compllaint of abridged freedom, no suggestion of oppression, no outcry;l_ aainst goverlnment PHILIPPINE LOCAL AUTONOMY 13 by force. We do not tax for our benefit. On the contrary, we aid your treasury out of which you expend at your own free will. In 1920 we collected in internal revenue in the United States the sum of more than three million pesos on Philippine products and turned the money into your treasury. We exempt your bonds from taxation in the United States and afford you a favoring market and ask nothing in exchange. We open our markets to your products as you open yours to us, in the mutuality of trade under one flag. We have spared you every burden of national defense and the cost of diplomatic representation throughout the world, yet you have been secure in your peace and your representations have been befittingly expressed. If we have been remiss, we do not know it. If mutuality has not been perfect, we choose to make it so. I note your appeal founded on changed conditions in the world. The world situation has, indeed, changed, with a higher augury of peace than we have even known before. But we are only entering the new order. It is not yet fixed. Your international security is fixed under our present relationship, but you would be without guaranty if complete independence were proclaimed. It will little avail to recite what seems to us to be the obvious advantages of association with the American community. These things do not appeal to those who are bent on the independent establishment. Moreover, accord and concord are essential to the furtherance of community relationship. Frankly I had hoped, probably I express the hope of miany of our people and likely some of yours, that somehow we might develop a relationship which assured to you complete selfcontrol in your domestic affairs, and would enable you to rejoice with us in the economic and political advantages which are the rightful possession of a great and righteous Nation. It would ill-become me to question your belief in readiness for the full obligations you seek to assume. There is no such thought in my mind. But I am thinking of our larger responsibility. Fate cast our relationship, and we assumed a responsibility not only to all the Phippine people, but to all the world as well. We have a high respect for your majority, but no less obligation to your minority, and we can not be unmindful of that world responsibility wherein your fortunes are involved in ours. No government is or can be perfect from the viewpoint of everyone. We know ours is not, after nearly a century and a half of experience, but it is not unseemly to assume that our experience is of great value. Long train'ing and universal education are essential to the approach to perfection. We not only provide education, but we compel it. You have made most commendable progress in education. Perhaps the judgment of your people to-day will be confirmed by your better educated people on the morrow, but we ought to be very sure of a highly preponderant and very intelligent public sentiment before taking the step which can not be retraced. Your allusion to a reversal of policy on the part of the first of colonial powers rather argues for delay than commends immediate action. More than a century of colonial relationship between Great Britain and her. more notable colonies has been marked by training for government and the approach to the measure of autonomy which prevails to-day. In the main the longer training has strengthened the cherishment of freedom: under the larger relationship, and the great, free dominions seem more rejoiced in the membership 'of British peoples than would have been believable 50 or even 25 years ago. They reflect the colonial benefits of larger association under one flag. I do not invite the inference that we are working to that relationship. We should not wish it unless it were equally your desire. Whether wisely or not. our disavowal of permanent retention was made in the very beginning, and a reversal of that attitude will come, if ever, only at your request. The indefinite expression has ever been as to time for launching you into your own orbit in the world of nations. You have declared your own readiness. No American authority, except as responsibility was passing, ever has been sufficiently assured to give its stamp of approval. Mindful of your aspirations, the Wood-Forbes mission was sent to the Philippines, with instructions to investigate conditions, appraise- your progress, and make report. The personnel was chosen with. the view to have the appraisal made by outstanding and able men, who had been familiar with your earlier stages of self-administration. This mission reported many manifestations of progress, many things achieved which must have strongly appealed to Philippine pride. I- can assure you they enhanced the pride of America in her helpful relationship. It was the recital of a splendid showing in material, intellectual, political, and moral 14 PHILIPPINE LOCAL AUTONOMY progress. It gave proof that no deprivation had hindered your advancement. that no essential freedom of citizenship, which we claimed for ourselves, was not possessed by every citizen of the islands. Only national responsibility is lacking, for which there are ample compensations. Frankly, then, with every mindfulness for your aspirations, with shared pride in your achievements, with gratitude for your loyalty, with reiterated assurance that we mean to hold no people under the flag who do not rejoice in that relationship, I must say to you that the time is not yet for independence. I can imagine a continued progress which will make our bonds either easy to sever, or rivet them more firmly because you will it to be so. We must await that development. The new order in the world, made secure, with conquest outlawed and with peace made the covenant of all civilized peoples, may speed the day when you neither need us nor wish our intimate relationship. At this time it is not for me to suggest the day, distant or near. Meanwhile, I can only renew the proven assurances of our good intentions, our desire to be helpful without exacting from your private or public purse, or restricting the freedom under which men and peoples aspire and achieve. No backward step is contemplated, no diminution of your domestic control is to be sought. Our relation to your domestic affairs is that of an unselfish devotion which is born of our fate in opening to you the way of liberty of which you dreamed. Our sponsorship in international affairs is reflected in the common flag whicll is unfurled for you as it is for us, and security is your seal of American relationship. WARREN G. HARDING. FROM THE MESSAGE OF PRESIDENT WILSdN Allow me to call your attention to the fact that the people of the Philippine Islands have succeeded in maintaining a stable government since the last action of the Congress in their behalf, and have thus fulfilled the condition set by the Congress as precedent to a consideration of granting independence to the islands. I respectfully submit that this condition precedent having been fulfilled, it is now our liberty and our duty to keep our promise to the people of those islands by granting them the independence which they so honorably covet The CHAIRMAN. Now, gentlemen, I would like to call your atten-. tion to one of the reasons for including those: You realize that when you come to a public document, to furnish information to people who write in, that almost all the information upon that subject, due to the Philippine Mission's activity, which I do not at all object to, due to the fact that half a million dollars has been appropriated for the purpose of pushing the interests of the Philippine Islands, and therefore having large amounts of money for carrying on the whole proposition, when these people from high school all over the country write in here, we find there is a dearth of information upon the subject that can be sent out to the people of our country, stating simply the other side of the problem, and for that reason I desired to have those papers incorporated into the record. STATEMENT OF. MR. JOHN H. PARDEE, PRESIDENT OF THE PHILIPPINE-AMERICAN CHAMBER OF COMMERCE Mr. PARDEE. Mr. Chairman and gentlemen of the committee, I did not come here with a formal statement. I did not receive the telegram from the chairman until day before yesterday. Mr. Switzer, president of the Pacific-Commercial Co., largest American commercial concern doing business in the Philippines, is preparing such a statement. Mr. Switzer went to the Philippines in 1898, in the first expedition from California, and was in Manila when the troops went in there. PHILIPPINE LOCAL AUTONOMY 15 He was one of the first American soldiers that landed in Manila. He lived there continuously, engaged in commercial business of various kinds, until he returned to the States in 1920. He was there in 1922 again. As I said, Mr. Switzer is carefully, preparing a statement, which we would like to have submitted to this committee at an early date, the first of the week, and he is qualified from his long experience in the Philippines to give you first-hand information much better than I can. As I have no prepared statement, perhaps I might qualify myself as a witness before you. I am president of the Philippine American Chamber of Commerce, an organization of 75 commercial firms doing business in the Philippines. That organization has never indulged in politics, and in what I shall say to-day, if there is anything touching on politics or the political situation, it will be my own opinion or my own statement and not as president of the chamber of commerce. We have tried to disseminate commercial information and work in connection with the Chamber of Commerce of the Philippine Islands, which is the Filipino chamber of commerce of the city of Manila, and also to some extent with the American Chamber of Commerce, which is composed of American firms in Manila. I am also connected with the Manila Electric Co., which has.taken me to the Philippines five times since the winter of 1915-16, staying there from two to four months each trip, and I came back from my last trip two years ago this spring. I am connected with the Philippine Railway Co., which is the Government railway, although it is, controlled to a certain extent byprivate interests in this country. I have visited a good many of the islands and am familiar with the country,. I have a number of acquaintances amqng the Filipinos, and I know a good many of these gentlemen here. I look at this question of the status and the relationship between the Philippines and the United States simply from one point of view, and that is, is it for the best interests, real benefit to the Filipinos themselves? There are over 11,000,000 people who are of a different race, and whose methods of doing business are somewhat different, and they have always lived there. There are comparatively few foreigners in the islands, only about 7,000 Americans.. Mr. RoXAS. About 5,000 Americans. Mr. PARDEE. There is a lesser number of British, and, of course, a large number of Chinese and some considerable number of Spaniards. As far as the commercial interests, the American commercial interests and foreign commercial interests in the islands are concerned, whatever is for the best interests of the Philippines themselves and the Filipino people is for the best interests of all the commercial people. So that I think almost as a unit the commercial interests of this country, who are interested there, look at the situation exactly that way. I have talked in the past several years with a great many of them and I find that that is the basis of their views. They do not 101692-24 —2 — 16 Pt'HILIPPINE LOCAL AUTONOMY all agree with me, and they do not all agree with each other, but that is the fundamental belief, that anything that is for the mateiral and commercial benefit of the Philippines and the Filipino people will necessarily reflect itself for the benefit of all commercial interests. In the first place, I know a great many Filipino people, and I have traveled through the provinces to a considerable extent. The Filipino people are a very friendly people. As testified here they have an inexhaustible thirst for education, as evidenced by the tremendous number of students in the public schools, and a large number of students that would be in the public schools if accommodations could be given them. The present status is not satisfactory to the Filipinos as they have testified. 4- dio not.hik they '.re sotisfactory to us. In fact, I am quite sure they are not satisfactory to the people of the United States. I have been in favor, for three years now, of changing that status in some way that would make it more definite, so that the Filipino people would know exactly what they would have to expect, that the people, the investors here, would know what to expect, and, in other words, what the game was or is when you go in. The Filipino people need a tremendous amount of capital for the development of their resources, and that capital will only flow when there is a more definite status than there is at present. I do not know exactly what to say, Mr. Chairman. I will be very glad to answer any questions that I can that the nembers of the committee would like to ask me in regard to any facts over there. Mr. SCHAFER. From your remarks I would infer that there is a scarcity of American capital in the Philippine Islands, and that the scarcity was due to not knowing just how the Philippine question stood. Is it not a fact that one Congress has gone on record, determining the status of the Philippine Government, in that when they have established a stable Government. it is Congress's intention to grant them independence, and furthermore if there is a scarcity of capital to be invested in the Philippine Islands on account of not knowing the exact status, I think we would have a greater opportunity of getting more capital from that angle if we would establish a definite status and grant them independence, because this bill under discussion does not definitely determine the status as the granting of immediate independence would. Succeeding Congresses may practically turn this bill upside down. Mr. PARDEE. On that point, if you would permit me, I would like to explain my position. I am not in favor of Philippine independence at this time. I am not opposed to ultimate independence. Prior to our occupation of the Philippines, the Filipino people had very little opportunity for education, and only the higher classes could obtain education. There were no public schools and the Spanish regime did not encourage general education. As the chairman has set forth. the statistics show the number of illiterates in the islands is very high. They have not a homogeneous language. They are not a homogeneous people, for the reason that there are a great many or a large number of distinct nationalities or races. While the basic race is generally the Malay, yet they are characteristically different in different sections of the archipelago. PHILIPPINE LOCAL AUTONOMY 17 The Filipinos have made remarkable strides in 25 years toward becoming a homogeneous people, and education has gone forward at a very rapid pace, so that at the present time there are a large, number of Filipinos who are able men and able statesmen, able scholars, but the number of those men for a government of 11,000,000 people is not nearly as large in proportion to the total number as it should be. If they took over at this time the independence of their Government, the number of men from which they could draw for competent men to run their Government in all its phases is not as large as it should be. The fact that so comparatively few read or are able to read, compared with the total number, and the comparatively few newspapers that are published and circulated in the islands, compared with the total number of people-you must bear that in miid all the time-iss relatively small, so that the great mass of the people,. who are a very large proportion of the people in the provinces do not get from newspapers, or from general knowledge, or from things that they read what the news is and what the situation is. It is very largely by word of mouth. Mr. SCHAFER. Don't you think they ought to be congratulated that they have not newspapers such as most of those we have in the States? I believe 90 per cent of our newspapers do not take the real news back to the people, especially the political news. Mr. PARDEE. I think you will excuse me from answering that question. Mr. SALMON. What is the attitude of the American-invested capital in the Philippine Islands toward independence? Mr. PARDEE. Well, I can only speak for those that I have talked with, and whose views I have obtained, and that probably represents upwards of 50 per cent of the American-invested capital over there. I believe. that those people feel that ultimately the Philippine Islands will become independent. Mr. BEEDY. Will or ought to be? You say that they feel that the Philippine Islands will become independent. What are your views? Ought they or ought they not to be inndependent? What is the view of the capital? Mr. PARDEE. I think that when the Filipino people have advanced for the next 30 years. their advancement will be at a more rapid pace than it has been in the past 25 years, and my own opinion is: that it will be very doubtful about whether they will want to entirely separate themselves from the United States. Mr. BEEDY. The question was not what the Filipino people wanted, but what 50 per cent of the American-invested capital, that you are in touch with, believes with respect to the possible independence of the Filipino people at any time, whether it ought or ought not to be granted? Mr. PARDEE. I think that after a period of 30 years they xwfill be advanced economically to such a point that if they should want it at that time that American capital would not object to their ha — ing it. Mr. BEEDY. What is your opinion and that of American capital. with which you are familiar, as to the advisability of a promise now of their independence in 25 years, considering the uncertainty as to the progress which may be made by them in that time? 18 PHILIPPINE LOCAL AUTONOMY Mr. PARDEE. The Filipino people are very ambitious people, and there is no criticism of that at all. They are not content without (l efinite date promised. That is my opinion they are not, and that as long as definite-date promise is not made, they will continue t,?igitate foi independence, and while they are agitating for independence and spending so much time in agitating for independence. and conducting all their political campaigns on a basis for indeendience, they will not have an opportunity to iprogress as much as they\ would otherwise, and they will not make as mluct material i>roresti ts, and that if the date. as may be definitely promised, may not be exacstly right within a few years, either one way or the other, it- will not make a material difference in the ultimate future of the Filipino people. For the benefit of their progress in the next 30 venrs, it is wise to make the definite date. Mr. BEFDY. Do you believe, then, that we should make them a definite promise of independence? Mr. PARD-EE. A definite date. M:'. BEFD)Y. And vyou feel that American capital is satisfied with that.proposition? M-r. PARDEE. Yes. sir. Mr. BEEDY. The majority? PMr. PARDEE. I am not passing on the majority, the capital that I know- of. Mr. BEE-D. Fifty per cent of it. You started out to voice the opinion of 50 per cent of it. MAV' PAnD)EE. (n that question I do not want to put a limit of 50 per cent. It is a very considerable part. I can figure it up. It is probably thirty-five to forty million dollars. Mr. BEEDY. It is safe to say this interest aggregating thirty-five to forty million dollars is opposed to independence at the present time Mr. PARDEr. Yes, sir; and opposed to it for the simple reason that it is not for the benefit of the Filipino people. Mr. HUDsoN. Would you distinguish in saying a definite time for independence, a definite date on which a plebiscite might be taken, as to whether the people wanted independence, or a definite pledge o(f independenf e. whether they wanted it or not. IMr. PAnDEE. I intended to say that the option should be given to them of that definite date. Mr. HUDSON. If they want independence they should have it? Mr. PA1Jr)Ei:. In other words. the United States would be bound and they would not be bound. Mr. SALMON. Now, take the attitude of American invested capital in the Philippines at this time, during the 25 or 30 year period, which you have mentioned, is it not possible and likely that Americii.t'it;.l -wourld continue to invest in the Philippine Islands and become more interlocked and interwoven with Philippine commercial business in such a way that at the end of 25 years or 30 years they would be stronger against Philippine independence than they are Mr. PARDEE. That is one of the reasons that I want to put a definite date in. Mr. KIESS. Have you finished your question, Mr. Salmon? Mr. SALMON. Yes. PHILIPPINE LOCAL AUTONOMY 19 Mr. PARDEE. Perhaps I can elaborate on that a little bit, because I do not think my short answer to it gives you the idea. The commercial business of the Philippines and tlir economic affairs will progress so in the next 30 years that business of all kinds can much better stand a severance, total severance of relations, than it can at the present time. Mr. SALMON. Now, is it not probable, however, that the progress of American investment in the Philippine Islands in the next 20 years under existing conditions and those promised in any bill, looking to future independence, would be greater with the American investment and the American capital than would be the progress of the Philippines toward looking to their own independence and their own government? Mr. PARDEE. No; if I understand your question, I do not think so. Mr. SALMON. Would not the progress of the American investment be greater than the progress of the Philippine people under existing conditions? Mr. PARDEE. No. Five years ago there were few Filipinos in business, and there are many now, and in 30 years from now there will be a great many. FMr. KIESS. What I wanted to ask is this: I understand that the principal political issue in the Philippines now, and it has been for a number of years, is about independence. Each party is trying to show that they are the real, Simon pure, independence party. Mr. PARDEE. Yes, sr. Mr. KIEss. And politics practically revolves around that issue? I take it from your statement that you think by settling this thing in the period of 30 years, that takes out of politics the issue of independence, and all parties are then on the same basis, so far as independence is concerned. That question has been definitely settled, that there., will be a plebescite, if the bill of Mr. Fairfield so ably presented, is adopted. Then the political parties of the Philippines naturally would have to deal with domestic questions, and would have other issues which would be, of course, to the benefit of the Philippine people, to remove the one controlling issue now. I took it from your: testimony that you thought that in the next 30 years, with that issue removed, that the Philippine people would make very muclh more rapid progress in their polities, as well as their commercial development. Mr. PARDEE. Yes, sir. jMr. RAGON. Then the Fairfield bill here, with the term of 30 years would be satisfactory to the American business' men that you speak of? Mr. PARDIaE. I think so. I think it will be entirely satisfactory. I have not studied the bill in detail as to every provision of it, but the situation is that the United States has been running the Philippine Government since 1916, with the assistance of Filipinos. and this bill, if I read it correctly, reverses the proposition and allows the Filipino people to run the Government, with some assistance from the United States, and it is to their great interest. The restrictions or rights of the United States, as shown in that bill simply go to the essential thing to preserve ill advised action on the part of the Filipino people. Mr. BEEY. You mean prevent it? 20 20 PliLLTPP~~~~jINELOC)AL AUTON(iN{ Mr. PARDEE. Yes: I mean it will prevent that. Mr. RAGON. You qualified your statement to Mr. Beedy. You do not know that you Represent 50 per cent of the opinion of American business men doing business il the Philippines? Mr. PARDEE. Well, there are many American business men over in the Philippines who do business entirely there, that I am very sure would not agree with me at all, but I know that many of the principal interests there doing business in the Philippines do favor that general proposition. I do not know that they would favor the exact terms of this bill. Mr. RAGON. Do you think that would represent the opinion of your organization, the American Philippine Chamber of Commerce? Mr. PARDEE. Well, it would be very difficult to get that opinion. I have talked to a great many of them, the principal ones. and I know they do, but a good many members of that organization are importing houses that have no particular interest in the islands. Mr. RAGON. I believe you stated there is some connection between you and the American Chamber of Commerce? Mr. PARDEE. Only the cable connection, that is all. Mr. BEDY. For the purpose of the record I understood Mr. Pardee, in response to my question about the wishes of the American capital invested in the Philippines to commence answering the question by saying he represented or could speak for 50 per cent (not of the Americans in the islands), but 50 per cent of the American capital in the islands. That statement he later qualified by saying that he could speak for thirty to forty millions of dollars' worth of American invested capital. Mr. RAGON. That is the way I understood it. Mr. PARDr. Yes, sir. There is upward of $100,000,000 of American capital in the Philippines, or perhaps not quite, and I think I could safely speak for $35,000,000 of that at least, knowing their views on it. Mr. MACLAFFTY. I propose, Mr. Chairman, that when a member wishes to address the witness in the future that he address the chair first. Concerning the question of immediate Philippine independence, is the tax income of the Philippine Government to-day sufficient to maintain a government as a distinct and individual nation, in the matter of their foreign affairs, in the matter of their domestic administration, in the matter of military and naval affairs? Mr. PARDEIn. I do not think so. I have read the testimony before this committee, or the Senate committee, and I think it was fully testified that they were not. Mr. MACLAFFERTY. Is it or is it not utterly inadequate at the present time? Mr. PARDEE. I think it is inadequate at the present time. Mr. V.xMALAFFERTY. What, in your opinion, would be the effect upon the Philippine people of giving them their independence as soon as it could be done, by an action of Congress, in accordance with their request-what would be your opinion as to the economic effect upon the Philippine Islands, the Philippine people, if this were done at once? Mr. PARDEE. The entire severing of relations? PHILIPPINE LOCAL AUTONOMY 21. Mr. MACLAFFERTY. The Asiatic exclusion law would be applied against them, and they would simply be set up as an independent nation, and we would live apart. Mr. PARDEE. The progress of the Filipinos so far in matters of health has been very great. They are living in better quarters. Their diet is more diversified. Statistics show that their stature is really increasing, and they are able to do more work on account of a diversified diet. They are obtaining more pay and are obtaining more of the luxuries, you might say, of life. The pay of the Filipino laborer is now three times or four times, I think statistics show, what it was 25 years ago, and at the same time wages of all the other orientals has not increased. This is due to the increased price of their products which they receive on account of the markets of the United States. which markets are open to them. If those markets were closed to: them they would have to compete with the Dutch East Indies and-s with the other countries over there, with the result that the price oflabor, common labor, around 70 cents a day, where it used to be 15 to 20 cents, would have to go back immediately to that former level; consequently they would have less money, the common people would have less money for the necessities of life, and their whole economic structure would be affected directly in that way. Mr. MACLAFFERTY. In your opinion, then, they could not maintain themselves to-day as an independent nation in competition with the world? Mr. PARDEE. I think it would be extremely difficult for them to do so. Mr. MACLAFFERTY. Do you think that the Philippine people desire that American capital should come there for investment? Mr. PARDEE. I do. Mr. MACLAFFERTY. The American capital invested in the Philippines, of course, is far in excess of the capital from any other source, is it not? Mr. PARDEE. Yes, sir. Mr. MACLAFFERTY. That is all. Mr. PARDEE. The Filipino people welcome Americans. They welcome American ideas. They like Americans better than any other nationality. They adopt our methods and our principles, and they welcome American capital. The objection to capital has been in the past that it might militate against their right to ultimate independence. Mr. MAcLAFFERTY. Is the objection, in your opinion, from the Philippine people, or has it been made gradually a political issue, just as in this country, where one party strives to outdo the other in proving their devotion to the people? Mr. PARDEE. Unfortunately it is the only political issue in the Philippine Islands. The political arguments to prove that one candidate is more for independence than the other candidate are going on all the time. Mr. MACLAFFERTY. Do you know what the total tax income is of the Philippine government to-day? Mr. PARDEE. I can not tell you. I can prepare it for you. Mr. MACLAFFERTY. You have a definite idea of what it is? 22 PH:ILIPPINE LOCAL AUTONOMY Mr. PARDEE. The Philippine government has, I think, a budget this year of 166,000,000, and an estimated income of 170,00,000. Mr. MACLAFFERTY. Sixty-six million pesos-$33.000,000. Mr. PARDEE. Yes, sir; that is right. Mr. MACLAFFERTY. In other words, their income would not build one modern battleship? Mr. PARDEE. I do not know what they cost. Mr. MACLAFFERTY. They cost about $40,000,000 or $50,000,000. Mr. PARDEE. No: it would not. Mr. KIEss. At the present time the United States is the principal market, is it not, for the Philippine Islands, for their sugar and other products? Mr. PARDEE. Yes; of course on hemp there is a different rule on that, for the reason there is no duty in the United States on hemp, as I understand it, but their market for cigars is in the United States and in Spain, and their market for sugar is in the United States. Mr. KIss. Independence, of course, would immediately put up the tariff bars against them on their shipping sugar and cigars and tobacco? Mr. PARDEE. On sugar alone would affect principally the Filipinos. It would affect American very little, for the reason that the growers of the cane are almost entirely Filipinos, and they receive 50 to 55 per cent of the sugar produced, in pay for their cane. I can not give you the exact percentage, but probably 60 per cent of the sugar mills are owned by Filipinos, or Filipino interests, or by the Philippine government, and so 80 per cent of the sugar that goes out of the islands belongs to the Filipino people, and no one else. Mr. lMACLAFFERTY. How much of it comes to the United States? What percentage? Mr. PARDEE. About two-thirds of it, I think. Mr. BEEDY. I understand your idea to be that with the increased competition that would immediately result in the granting of independence to the Filipinos, the price of labor in the islands would decline, and thereby the possibilities of raising taxes for the government would diminish? Mr. PARDEE. Yes, sir. Mr. BEEDY. So that whereas taxes are already inadequate, they would be more so under independence? Mr. PARDEE. Yes, sir. Mr. BEEDY. DO you think that American capital would be eager to go to the Philippine Islands if independence were granted them? Mr. PARDEE. I can't imagine that it would, unless there might be some extremely unusual circumstances. Mr. BEEDY. Julst now while the situation is unsettled. do I understand that American capital is not flowing to the islands? Mr. PARDEE. It is not, not for any permanent investment or development. The commercial business is carried on, but that is not really a permanent investment. Mr. BEEDY. The fixed status incident to independence would not invite capital from this country? Mr. PARDEE. Not if it is immediate. Mr. SCHAFER. When. in your opinion, will a status be fixed, and what kind of a status should there be to invite American capital? PHILIPPINE LOCAL AUTONOMY 23 Mr. PARDEE. Well, I think that for the tranquillity of the country and for the growth and development of the country, on account of the political situation, it is necessary to fix a date when they can have their independence, if they so desire. Now, that date, in my opinion, should be at least 30 years, and in that time their development will be so great that they can stand, if they so choose, the shock of a severance of relations, but in the meantime American capital will go there for investment. Mr. SCHAFER. That is all right to make that statement, but we are told that American capital will not go there at present because of uncertainty as to the ultimate status of the Philippine government. Then we are told if we fix it at 30 years capital will go to the Philippines. If we fix it at 30 years American capital will have no more, assurance-if this Congress enacts this bill before us I can not see how American capital will have absolutely conclusive reason to know that at the end of 30 years the Philippine independence is. to be granted, and consequently I can not see how you can back up, your statement that it will flow there if we pass the bill. Mr. PARDEE. It is perfectly true that if this Congress passed this bill that they could at the next session of Congress repeal it. Mr. SCHAFER. And furthermore the peopleMr. PARDEE. But this bill, if passed, becomes a law, and it is more than an ordinary act of the Congress of the United States; it becomes in effect practically some kind of a treaty between the Filipino people and the United States. Mr. MAcLAFBERTY. It is a pledge. Mr. PARDEE. It is a pledge, and no Congress, in my opinion, after that pledge is once given, will out of hand, in a moment, undo what this Congress had done. Mr. SCHAFER. Did not a previous Congress make a pledge which will be nullified if we enact this legislation as provided in the bill under discussion? Has not a previous Congress pledged independence when they should have established a stable government? Mr. PARDEE. They have not made a definite pledge on any particular date. Mr. MILLIGAN. Do you mean if the Filipinos were given inder peIdence, American capital would go to the Philippine Islands? Mr. PARDEE. I think very little would. Mr. MILLIGAN.* DO you think the present American capital in the Philippines would withdraw? Mr. PARDBE. The permanently invested capital eould not do it. Mr. MILLIGAN. Would it be possible to gradually withdraw? Mr. PARDEE. If immediate independence were granted, a lot of that capital employed in trading would bewithdrawn, because there would not be the trade. The banking capital would withdraw, because there would not be the banking to do. Mr. MILLIGAN. On what do you base that statement, that no American capital would go to the Philippines if, they weregive immediate independence?, Mr. PARDEE. I did not intend to make it!as strotag as that. Very Iitt.e. -; Mr. MILLIGAN. Very little, if any, as I understood your statement. *, I.;,~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~. 24 PHILIPPINE LOCAL AUTONOMY Mr. PARDEE. I know of one company where the capital is all raised now, $150.000, and if this Congress passes immediate independence they will not go. If a bill like this is passed they will go there. Mr. MILLIGAN. tWhy do you make that statement? I would like to get that clear, that they would not go to the Philippines? Mr. PARDEE. Because the severance of all trade relations and economic conditions in the Philippines would be so bad that they could not get any return on their money, and there is no reason why they should go. Mr. MILLIGAN. That is conjectural, is it not, on your part? Mr. PARDEE. Oh, yes; it is a mere matter of opinion. Mr. MILLIGAN. This chamber of commerce that you represent, is that a branch of the Chamber of Commerce of the United States, or an independent? Mr. PARDEE. We are a member of the Chamber of Commerce of the United States. Mr. MILLTGAN. It is a sort of a branch? Mr. PARDEE. They do not have branches. Any chamber of commerce that is formed can become a member of the Chamber of Commerce of the United States. Mr. MILLIGAN. Has your organization considered the Fairfield bill? Mr. PARDEE. No, sir. Mr. MILLIGAN. Have your officers? Mr. PARDEE. No, sir; except that I have considered it. Mr. SALMON. Mr. Chairman, I would like to ask a question: You spoke of there being only one issue in the Philippine Islands, that of Philippine independence. Are there any considerable number of Filipinos opposed to independence? Mr. PARDEE. I believe that there are. Mr. SALMON. What do you base that belief on? Mr. PARDEE. You mean opposed to immediate independence? Mr. SALMON. Yes, sir: I mean outside of the influence of the Americans over there. Mr. PARDEE. Statements made in the recent senatorial campaign, that is, last summer, for selection of a Senator from a district which includes the city of Manila. The Democratic candidate, Judge Sumerlong was opposed to immediate independence. He was very strongly in favor of ultimate independence. Mr. SALMON. Was he defeated or elected? Mr. PARDEE. He was defeated. Mr. MACLAFFERTY. How do the Moros feel toward independence? Mr. PARDEE. Well, I can't answer that. I have never been down in the Moro country, and I do not know if I could ascertain if I went there. I understand there are petitions both ways from the Moros. Mr. KENT. Mr. Pardee, Mr. Ragon has suggested that I ask what percentage of the population the Moros constitute? Mr. ROXAS. Four hundred thousand Moros, less than 4 per cent out of the total population of eleven and a half millions. Mr. PARDEE. The Moros are all classed Mohammedans. There are 343,000 Mohammedans, and they are the Moros. Mr. KENT. Mr. Pardee, I understood the chairman to begin his statement, calling attention to the fact there were 7,083 islands in this archipelago and that there was a population of over 11,000,000, PHILIPPIN E LOCAL AUTONOMY 25 and that at the present time over 50 per cent of the people above 10 years of age are illiterate. Mr. PARDEE. That was the census of 1918. Mr. KENT. And that 1,500,000 speak English, 800,000 speak Spanish, and that over 9,000,000 speak 87 different dialects. I am:just wondering what kind of an election they do have when they hold these elections, whether or not these people are in favor of independence, and how many votes are cast, and who casts them. Can you tell us anything about that? Mr. PARDEE. I do not think they have had an election in which they could vote on independence by itself. Mr. KENT. Pardon me. They vote for candidates for independence? Mr. PARDEE. Yes. Mr. KENT. The candidates, no doubt, go out on the rostrum and talk independence, and you say the one that talks the loudest and longest and most earnestly for independence is elected. What kind of people do the voting? Mr. PARDEE. People all are for independence irrespective of the candidate they vote for. Some of them think one is more independent than the other candidate. Mr. KENT. What kind of people do the voting? Mr. PARDEE. I think it has been testified before the committee as to the number of votes that are cast at the annual elections. I have not the figures. I think Mr. Roxas can give you the figures. It is a comparatively small proportion. Mr. KENT. Have they ever had an educational issue before the people for better schools, better roads, better banking institutions, and matters of that kind? Have they gone to the people on issues of that kind? Mr. PARDEE. I do not think so, except in probably particular localities, for municipal officers or provincial officers. Of course, -everybody is in favor of education,, and the amount they appropriate for education is very large. Mr. KENT. DO you know anything about the total funded debt for educational purposes in the islands now? Mr. PARDEE. I do not think it is segregated for education. They appropriate about $7,000,000 a year. Mr. RoxAS. 9,000,000 pesos this year. Mr. PARDEE. 9,000,000 pesos this year. Mr. KENT. 9,000,000 pesos per year? Mr. PARDEE. It is $4,500,000 in our money. Mr. KENT. The thought I had in mind is this, there are certain political units, boroughs, townships, corresponding to our townships and boroughs, cities, and townships. Mr. PARDEE. Yes, sir. Mr. KENT. I would like to have the figures as to the exact amount of money that is actually invested by those municipal units in schools. Mr. PARDEE. I can have that prepared for you. Mr. Roxas can -prepare that for you. Mr. KENT. You were also saying there is an intense thirst for knowledge and education on the part of these people, that a large number more would be in these schools if thev had the schools to 26 PHILIPPINE LOCAL AUTONOMY accommodate them. Do I understand that this appalling illiteracy that you speak of here is due to the fact that they have not got schools? Mr. PARDEE. No, sir; you must understand that there was no such thing as general education under the Spanish regime. You go out through the country and you find that all the children in the schools speak their native dialect, because they learn it when they are born. Mr. KENT. One of the 87 dialects? Mr. PARDEE. Yes: and they speak English, and they do not learn Spanish. The Spanish language is declining, and will decline more rapidly in the future. You can travel almost anywhere in the Province, except in the most remote places, and get along with English, because the children can speak English. Some of it is not Elizabethan by any means, but you can understand it. Of course. it is very difficult for the Government to obtain sufficient teachers on account of the expense. They can not take over American teachers to a very large extent. They have to use Filipino women and men, and consequently the English that is taught in the general schools is not particularly good. Now they have established normal schools for the particular purpose of teaching English to teachers. Mr. KENT. Your thought of the matter is that within a period of 10 or 15 years the educational facilities of the islands will so increase that the percentage of illiteracy will increase and the intelligence of the voters will no doubt increase correspondingly? Mr. PARDEE. Yes, sir; absolutely. It will take more than 10 or 15 years. Mr. KENT. I have not gone very thoroughly into the hearings on the question of their currency. Have they a uniform banking law? Mr. PARDEE. Oh, ves. Mr. KENT. They have? Mr. P-ARDEF. Yes; that was established by the United States. Mr. KENT. Are their local banks there raised up under that laws Mr. PARDEE. Oh, yes; they all have to conform to that law. There is the Philippine National Bank, which is the national bank, the Government owns the majority of the stock, and there is the International Bank, which is an American institution. There are two British banks; there is a Chinese bank, and the Bank of the Philippine Islands. which is owned by Spaniards and Filipinos. That is looked upon as the Philippine bank, and it is sometimes called a Spanish bank, but that is administered now by an American. Mr. KENT. Is the Royal Bank of Canada there? Mr. PARDEE. No; because those are the only banks. Mr. KENT. Does the Bank of England have a bank there? Mr. PARDEE. No, sir. Mr. KENT. Does the National City Bank of this country? Mr. PARDEE. It controls the International Banking Corporation. There were a few other American banks there, but they have closed up. Mr. KENT. I understood you to say approximately $100,000,000 of American capital was invested in the islands? Mr. PARDEE. Upward of $100,000,000, outside of Government obligations. Mr. KENT. In comparison to the vast resources of the islands, that is a comparatively small sum of money. is it not? PHILIPPINE LOCAL AUTONOMY 27 Mr. PARDEEr Yes, sir. Mr. KENT. Are any local Filipinos among the boards of directors of those corporations which are owned by American capital? Mr. PARDEE. I think so. I can't answer that absolutely. Mr. KENT. Is there any joint investment corporation-that is, between persons residing in the islands-actually native Filipinos and Americans? Mr. PARDEE. Yes; there are some. Mr. KENT. Is there much of that? Mr. PARDEE, Not very much. Mr. KENT. It is your thought, then, that within the period you mentioned, say 25 or 30 years, which you have suggested as your opinion of the time which should elapse before they could be given a definite opportunity to say whether they wanted independenceis it your thought that within that period of time Filipinos and Americans will jointly go forward with the program of development and progressive investment, and at the end of that time they may not want independence, but will want to stay with this country? Mr. PARIEE. I think so. Mr. KENT. But even though they do not, if they should vote for absolute independence, do you think that the financial arrangements and the obligations between the people of the two nations will be so intertwined that it will then be safe to let them go away to themselves, and safe to the country? Mr. PARDEE. In the severance, the complete severance, of relations between the Philippines and the United States, whenever that occurs, whether now or 25 or 50 years from now, there will be some shock, because it will cut off all trade relations, but the shock will be less 30 years from now than it would be now, and whenever that does happen the damage that it does will be felt by the Filipinos just as much as it is by the outside capital that is invested there. Mr. KENT. Suppose, for instance, that we fix the time at 10 years from now, and they would have resentment in the islands upon this subject, do you think that within a period of 10 years very much foreign or American capital would go in there? Mr. PARDEE. No, sir. Mr. MACLAFFERTY. In other words, what you mean is like a surgical operation that cuts off the arm, it is apt to be harder on the arm than it is on the body; is that what you mean? Mr. PARDEE. It might possibly be so. Mr. HUDSON. In your opinion, could there be a.ny adequate plebiscite taken at the present time by the people that would be adequately representative of the whole people? Mr. PARDEE. Gentlemen. when you come to vote on the question of independence of your country there is very little difference of opinion when a large part of the population is not educated. Every body is for independence in the Philippines openly. Mr. HUDSON. I understood you to say that a certain per cent of the Filipinos were not in favor of independence? Mr. PARDEE. I do not think they are really, but if you ask them they will say they are, from many things I have heard. Mr. MILLIGAN. How would you know if they are or not? Mr. PARDEE. Because it is the absorbing topic of conversation. 28 PH1ILIPPINE LOCAL AUTONOMY Mr. MILLIGAN. Was not that an absorbing questi)on in this country when we wanted our independence, and should it not ',e so so far as the independence of any other country is concerned? Mr. PARDEE. I think so I do not criticize the Filipinos at all. I think that when the Filipinos ask for immiediate independence they do not realize the damage they would do to tl.hemselves if they sholuhl obtain it. Mr. MILLIGAN. And particularly to American capital? Mr. PARDEE. No; it would hurt themrl multor tlha: it - ould huIrt Anerican capital. Mr. KIESS. The fact that everybody talks for independence is, not proof that ev-erybody would vote for it? Mr. HUDSON. I would like to ask the chairman,a question in reglard to this bill. The CHAIRMAN. Proceed. Mr. HUDSON. Under the provisions of your proposed bill 1helre would not the Philippine Government be in the same relation practically as any Commonwealth of the United States, so far as any interior government is concerned? Mr. PARDEE. Practically. Mr. HUDSON. Really we create them an independent Commonwealth. The CHAIRMAN. They are as free and independent as any State in the Union under the terms of that bill. Mr. SCHAFER. Mr. Chairman. I do not think so. Mr. RAGON. May we not get on with these hearings, Mr. Chlairman. and then we can discuss these other things? The CHIAIRMAN. I find it is now nearly 12 o'clock, and we will adjourn until 10 o'clock to-morrow iliorning. (Whereupon. at 10 minutes of 12 tle conni;ittee adjourned until to-imorrow. Thlursday, May 1. 1924, a.t 10 o'clock a. m}.) COMMITTEE ON INSUL1AR AFFAtIRS. HOUSE OF REPRESENTATIVES. ThW/rrday. Mlay? 1 1 924. The committee this day niet, Hon. Louis W. Fairfield (chairman) presiding. The CHAIRMAN. Gentlemen of the committee, we have met this morning to continue the hearings, and we will proceed. STATEMENT OF MR. CHARLES M. SWIFT Mr. SWIFT. Mr. Chairman and gentlemen of the committee, by way of introduction I will say that I am president of the Manila Electric Co., operating a street railway and power and lighting plant in Manila, and I am also president of the Philippine Railway on the islands Cebu and Panay. We got our Manila franchise 22 years ago, a 50-year franchise, and have built up that system there. By way of showing my interest in the situation, I may say that practically everything I have is invested over there; so I have a strong personal interest in what happens to the Filipinos, and in their political status. PHILIPPINE LOCAL AUTONOMY For the sake of saving time, I am not going into detail on population, or detail of imports or exports. I have not those figures on my tongue's end; and furthermore, I will assert an older man's privilege, and let younger men present the details of the question. Mr. John Switzer will be a witness here to-day, and he has got all those figures, if anyone wants to know them. I shall devote myself, gentlemen of the committee, to my conception of the relations between the United States and the Philippine Islands, not only from a practical standpoint, but perhaps from a sentimental standpoint.' The first important question to consider is just what this committee has before it, the fixing of the political status of some 11,000,000 Filipinos. This duty, perhaps the most important of any duty devolving on any committee of Congress, either in the House or in the Senate, rests with your committee. Its first inquiry must be, what is a Filipino? What is his present political status? What is he? When we took over the Philippine Islands they became United States territory. That much has been settled by the Supreme Court of the United States. Thereupon Congress, in discharge of its treaty obligation to fix the political status of the Filipinos, declared them to be citizens of the Philippine Islands (which was United States territory) and, "as such, entitled to the protection of the United States." I want to emphasize that phrase, because that " protection," then guaranteed, is the only real official promise that the United States has ever given that amounts to anything. That promise created a status that should be understood at the outset. The United States could create but one type of citizen. It could not create a Chinese citizen, a Japanese citizen, ar anything but a United States citizen; and, therefore, in my opinion, with that declaration, it made the Filipinos United States citizens of the Philippine Islands, which was United States territory. Now, when they added to that the statement that "as such, they are entitled to the protection of the United States," they created a status which is practically the same as our own. That word " protection" covers everything. That means liberty and independence to you, myself, and the Filipinos. It means that the United States agreed to protect the Filipinos against foreign aggression and against domestic aggression. By that it undertook to protect him against foreign foes, and it also guaranteed that he was. going to live under a constitutional government. Later it proceeded to follow that with various enactments in the nature of a bill of rights, which gave him every right, practically, that every American citizen has, and thereby created him a free, independent, constitutional citizen, under the protection of the Stars and Stripes; and that is a status, in my opinion, that can not be taken away. I do not believe in being too sentimental in discussing these matters; but,. after all, you remember, perhaps, that at one time an English judge decided when a slave put his foot on English soil he thereby became free; and likewise, I say, when the United States has created a political status of this kind and conferred it on anybody, it is a permanent status and can not be taken away. That is the position that I hold in reference to the Philippine Islands. That position is entirely consistent with extending to the Filipinos the very greatest possible measure of local autonomy. 30 PHILIPPINE LOCAL AUTONOMY I am, by the Contitution of the United States, a citizen of Vermont and also a citizen of the United States. I am created a citizen of the United States and of the State in which I reside. I owe allegiance to the State of Vermont, and I owe allegiance to the United States. The United States touches me in matters called federal. In all local matters I respond only to the State of Vermont. By analogy the position is exactly what will happen in the Philippine Islands. We should extend to them as fast as they are able to assimilate it the widest measure of autonomy; at the same time, the United States should not surrender its guiding hand, its protection, which means the assurance to the Filipino that there will alway be a consitutional government. Mr. WILLIAMS. When the United States created, or through law made, the Filipinos citizens of the United States that was unalterable. Do I understand you to mean the United States has not the authority to make them free and independent, and not citizens of the United States? Mr. SWIFT. I think the United States has already made them free, independent people by giving them that status. Mr. WILLIAMS. Do you not believe that the United States has authority, by making them an independent nation, thereby to terminate their citizenship of the United States; and was that not the intention of the United States at the time they took the Philippines over? Mr. SWIFT. I do not find any evidence of that being the intention. I do not find any evidence of that being the intention when they took the Philippines over. They assumed sovereignty over the Philippine Islands. Mr. WILLIAMS. I will make myself plainer. In your judgment, the United States should at no time take the guardianship away from the Philippine Islands and permit them to be a free and independent people, a different nation, and not citizens of the United States. Mr. SWIFT. In my opinion you are stating pretty nearly what is correct. I believe it creates a status; of course, I do not deny the power of Congress to do anything. Mr. WILLIAMS. I understand it. Mr. SWIFT. Whatever my opinion may be, or even if it were the opinion of everybody, Congress could do it by force and violence. I am speaking now of what it would in effect be. It would destroy a constitutional status and substitute a status unprotected by a constitution. At present every Filipino out there can appeal to the United States if he is oppressed. Mr. WILLIAMS. He is a citizen of the United States. Mr. SWIFT. He can appeal to the Supreme Court of the United States. He is entitled to all the constitutional things that make up our bill or rights, that you and I are entitled to. If you take those away and give him independence to-day, and to-morrow the Japanese go in there, he would be transferred in a very short time from having these constitutional rights we have guaranteed into a person without any constitutional rights, subject to autocratic Japanese government. Mr. WILLIAMS. I do not want to delay this hearing. If that is your idea, that these people should be kept under the protection of PnILIPPINE iLOCALi AlUTONOMY 31 the United States, there is coming a time when, if they could hb an independent nation, they would want recognition as a State.; Would you favor recognizing them as a State, and giving them represent tation in our Government that our States have?. Mr. SwIFr. I do not think that is necessary. I think they are created United SStates citizens of the Philippine Islands. -I think it is quite within the power of Congress, which differentiates between different citizens in different places, to create a political status which is not that of a State or of a Territory, as I understand it. -. Mr. WILLIAMS. The idea that you have suggested is that there should never come a time that these islands should be free and turned loose from the United States. - Mr. SWIFT. There should never be a time when the:United States should give iup what is meant when it guaranteed them protectionguaranteed protectioLnto the citizens of the Philippine Islands. Mr. WILLIAMS. That lis guarantyship or a protectorate. Mr. SwIrV. Yes: it is. i Mr. WILLIAMS. The Filipinos would be citizens of the United States. Mr. SWIFT. I think it means that the United States, as a: constitutional government, can not go out and take another couniary.anf its people without incurring a very serious responsibility. By the very act of assuming sovereignty they would assume this obligation. I am saying this to call the attention of the committee to the seripusness of the proposition, so you will have in miind what you:will do to the Filipino' if yo g too far. Now, that is absolutely econsistent with the gift of broad, local autonomy, and therefore I very strongly favor the bill that has been proposed by the; chairman of your committee. Mr. BEEDY. The witness does not understand the bill. He says he does not think the Filipinos should ever be free. He says he is for this bill. The bill provides they should be given the right to independence in 25 years. Mr. SWIFT. I am in favor of the bill, with the exception ofthat on clause. Considering my age-l am fow 70 years old —what might happen at the expiration of 30 years might not affect mei personalIy but that provision in the bill is inconsistent with my conception of the relations between the Philippines' and the United States. Mr. HUDSON. I see no incongruity in your statement that you make and which Mr. Beedy stated, because this is not taking away the protection from the Philippines, the guarantyship as citizens. If it is taken away, they take it away under the plebiscite. Mr. KENT. It is quite a difference, is it not? Mr. SWIFT. Quite a difference; but, after all, in the case of the Filipinos I should want to be sure that they all knew what they were doing before I would give it up, and for that reason I beg leave to differ with my friend, Mr. Pardee. I can not be for that clause, but I am in favor of this bill with that clause in as against any proposition to set the Filipinos free now without any conditions. Mr. WILLIAMS. One more question: Mr. Swift, do you believe that in the course of time the Filipino, if he progressed to the extent that he is capable of self-government, and that the Filipino said to the 101692-24 —3 32 PHILIPPINE LOCAL AUTONOMY United States that they would rather be free and independent people atid relieve us of their citizenship-do you not believe that at that time they should have their independence? Mr. SWIFT. Yes; I do believe that if the United States were assured that that statement that came to the United States from the Filipinos was a statement coming from all the Filipinos. The CHAIRMAN. You do no mean evewr man, woman, and child in the islands? Mr. SWIFT. No; nearly all of them. The CHAIRMA2N. The majority? Mr. SWIFT. Yes; a large majority, too. I am speaking theoretically, perhaps, to a certain extent. I am very much impressed with the Filipino characters,, and always have been impressed. I like the Filipinos very much indeed. I know some of them very well. We are very friendly, and I am fond of them; and I believe so far as local self-government goes that the Filipinos will, if given time, sometime be fully capable of conducting their own local affairs. That is what I like about this bill. The only way they can learn to do that is to be given a chance to try it. They can never learn, whether they are competent to make laws and enforce laws and create their status out there unless they are given an opportunity to try it. I would say this is the time for them to be given an opportunity; and my opinion is, if this bill goes through, the Filipinos would make as good a showing under autonomous government as many of our own States and Territories after awhile. In the first place they have an intense desire for education. They have an intense desire to make good. They want to! make good. I think where they have gone wrong sometimes is they have not fully understood and have not been properly taught, properly led, properly suggested to. I believe eventually the citizens of the Philippine Islands will be a pretty good self-governing community. Mr. WILLIAMS. I realize your opportunity to know those people for over 20 years; I recognize your ability to pass on them more than a man that has not been there. But my question was, Should the time come —say, 10, 20, 30, or even 40 years hence-that the Filipinof people were capable of self-government, and they then said to this Government that they would rather be citizens of their country and not be citizens of the United States, would you not at any time then favor that? Mr. SWIFT. I am inclined to think I would; yes; but, of course,.hat time would be after 25 or 30 years of self-government. Mr. WILLIAMS. I would not have asked that but for the reason that vou said before that the United States should never take away the guardianship. Mr. MACLAFFERTY. What is your belief as to the ability or right of the United States Government, having once accepted sovereignty over any area-Hawaii, Alaska, or the Philippines-what is your belief as to the right of the Congress of the United States to alienate any territory from the sovereignty of the United States. vMr. SWIFT. My personal belief is they can not do it. Mr. MACLAFFERTY. You do not think that can be constitutionally done? Mr. SWIFT. I think it would be unconstitutional: but I do not know where vou could submit the question. I do not know where. PHILIPPINE LOCAL AUTONOMY 33 As I understood the question, it was whether, in my opinion, the Government of the United States, having once obtained the sovereignty over any land, could legally relinquish that sovereignty? Mr. MACLAFFERTY. I mean the Congress of the United States. Mr. SWIFT. And I said, in my opinion Congress could not do it constitutionally, and neither, in my opinion, can they constitutionally expatriate citizens. Mr. MACLAFFERTY. What do you mean by "constitutionally"? My belief is that the only way it can be done is through the Constitution. Mr. SWIFT. Yes; I mean Congress can not without — Mr. MACLAFFERTY (interposing). Do you believe that Congress would have to pass an enabling act to permit them to alienate territory? Mr. SWIFT. I do. Mr. MACLAFFERTY. Then that would mean they could alienate any part of the Union, or any other domain governed by the country. Mr. SWIFT. We would cease then to be a constitutional government, in my opinion. Mr. MILLIGAN. I just wanted to know if there were any cases on that point. Mr. SWIFT. Oh, no. Mr. MILLIGAN. Do you not think this would be a good opportunity to try it out? Mr. SWIFT. I do not know where you could try it. Mr. MILLIGAN. Try it in the Supreme Court of the United States. Mr. SWIFT. I do not know where you could do it. Mr. MILLIGAN. You could grant them independence, and take it up before the Supreme Court. Mr. SWIFT. That question would have to come up from the Filipinos themselves. Mr. MILLIGAN. It is a legal procedure that you could get to the court on. Mr. SWIFT. I doubt it. I tried to find out, and I could not find it. I consulted some lawyers on the subject, and they said the question would be a mere matter of theory and there was not any way to get it before the Supreme Court. One other point that I would like to take up is the preamble of the Jones bill. The, CHAIRMAN. The witness wishes to proceed, and I wish that you would hear him. Mr. SWIFT. I would like to refer to the matter that was brought up yesterday in some of the questions to Mr. Pardee in regard to the preamble of the Jones bill. That preamble recites: Whereas ithas always been the purpose of the United States to withdraw their sovereignty over the Philippine Islands and to recognize their independence as soon as a stable government can be established there. Now, in my opinion, that is absolutely without meaning, "as soon as a stable government can be formed therein." You can look at that in two ways. First, it is an.admission that it was not then a stable government. In 1916, if that thing is correct, it was. not then a stable, government. In my. opinion it was a stable government when they passed that act; it is nowk a stable government, and it has * *.. - * *.. * *. ^. ***. *, 34 PHILIPPINE LO CAL AUTONOMY always been a stable government since we went in there, and the reason it is stable is because the United States has sovereignty; and there is not a thing in this act provided or hinted at that the Filipinos could do or leave undone that would make that a stable government. W17hat is a stable government and what is an unstable government I call a stable government a government that is run according to certain fixed rules, and with a constitution of some kind-monarchial or democratic or whatever may be capable of defending itself against outsiders and proceeding according to regular rules. An unstable government is the kind we have seen in some of our American republics, subject to change without notice," to use a commercial phrase. The. Philippine Government was not that kind at that time, yet tire implication was at that time it was not stable. If the authors of that clause meant something different, from what I say now, what did they mean, and what has happened since 1916 that mlakes their governnent any more stable than it was then? You can refer to the report of General Wood and Chairman Forbes and get the testimony on that question. What has happened in the Philippine Islands, been done by the Filipinos, that has made its government stable, if it was not stable, as implied here in 1916? Mr. SCHAFER. You are president of the Manila street railway system? Mr. SWIFT. Yes, sitr. Mr. SCHAFER. Is the house of J. G. White & Co. interested in the Manila street railway system? Mr. SWIFT. J. G. White Management Corporation is the manager of the property. Mr. SCHAFER. Is the house of Stone & Webster interested? Mr. SwIFT. No, sir. Mr. SCHAFER. Has the house of Stone & Webster ever been interested Mr. SWIFT. Never. I am interested in it more than anybody else. Mr. SCHAFER. In view of the fact that you quoted from the report of Mr. W. Cameron Forbes and General Wood, I would like to ask this question: Was not W. Cameron Forbes connected with the J. G. White Co. before lie became Governor General of the Philippines Mr. SWIFr. Not to my knowledge. I do not think they were ever connected. They were always rivals. Mr. SCHAFER. To your own knowledge, after he had retired from the Governor Generalship of the Philippines, did he go to South America in the interest of J. G. White & Co.? Mr. SIFTr. He did not. I am quite certain about that. He went down in the interest of somebody in Boston. He had nothing to do with White, so far as I know; but if he did I do not know about it. I am not a stockholder in J. G. White & Co., nor am I director. Mr. SCHAFER. J. G. White & Co., being interested in the Manila Railway system, I thought you, as president, might have some information as to the people interested in J. G. White & Co. Mr. SWIFT. I may have heard, but I have not heard anything of that kind, which you suggest. Mr. SCHAFER. DO you know anything about the allegation that one of Governor General Wood's first moves after he became Gov PHILIPPINE LOCAL 'AUTONOMY3 35 ernor General of the Philippines was an attempt to turn over the steam railroads of Luzon to J. G. White & Co.? Mr. SwIrr. I know through Mr. Pardee, who was president of their Management Corporation, that J. G. White & Co. suggested that they would like to act as manager. They are managing corporations all over the world, and there was some criticism made about the management of the Manila Railroad, so-called, which is a steam railroad, running north from Manila and south from Manila, and they applied for the position as manager for that road, and they did not get it. That is all there is to it. Mr. SoHAFER. Was General Wood agitating that they be given the management of the railroad? Mr. SWIrr. General Wood, I understand, declined to give it to them. Mr. SCHAFBR. At the time the movement was on foot to turn over the steam railroads of Luzon to J. G. White & Co., was Mr. Forbes connected with J. G. White & Co.? Mr. SwrT. That question has some implications in it that I can not admit. Will you readithe first part? (The question was read by the reporter as follows:) At the time the movement was on foot to turn over the steam railroads of Luzon to the J. G. White Co., was Mr. Forbes connected with the J. G. White Co.? Mr. SWIFT. There never was a movement on foot to turn over the steam railroads to J. G. White & Co. There was a movement on foot instituted by J. G. White to get the management of that road; that is, to do what they do for us, to keep the books. furnish the managers, and see that it had proper people to run it. That is all. They never undertook to get control of it. Mr. SCHAFBR. To your best knowledge and belief, General Wood looked with disfavor on turning the management over to this firm. as you state? Mr. SwIrT. Yes; he declined. There was some talk about their doing it, and he turned it down, as I understand it. Mr. SoCHAFr. To your best knowledge and belief, do you know whether or not W. Cameron Forbes was connected with J. G. White & Co. at the time that J. G. White & Co. Mr. SWIFT (interposing). I do not, think he ever had any connection with J. G. White at the time, or at any time. Mr. SCHAFER. To your best knowledge and belief, do you know whether or not W. Cameron Forbes was connected with J. G. White & Co. at the time he made the report on the Philippines, on October 8, 1921? Mr. SWIFT. I do not think, as I said in answer to your previous question, that there has ever been any connection between W. Cameron Forbes and J. G. White. I have always understood, without knowing about it, that Forbes was interested at one time with Stone & Webster, which is a rival concern of J. G. White & Co. Mr. SCHAFER. Is the firm of Stone & Webster and J. G. White & Co. interested in many, if not the virtual owners of many. street railroad companies in this country? Mr. SWIaFT. I dob not know anything about that. *;; E f -,.; 36 PHILIPPINE LOCAL AUTONOMY Xi r. MACLAFFERT.. We are here on hearings on the Philippine bill, Mr. Chairman. I do not wish to be discourteous, but I am here at some sacrifice. The CHAIRMAN. Mr. Schafer desires to connect up the movement of these people as being primarily interested, growing out of the interests of certain persons. Mr. KIESS. I would like to ask my colleague what he is trying to get at with his line of questions, if they have any bearing. Mr. SCHAFER. The questions are self-explanatory, and do not need explanation. One of the statements made by the witness was in reference to the report of Leonard Wood and W. Cameron Forbes. Inasmuch as this report of Leonard Wood and W. Cameron Forbes, on October 8, 1921, is adverse to the granting of Philippine independence, I believe it is very relevant to the question before the committee, to find out if there is any connection between the singers of this report and the corporations which are directly or indirectly opposed to the granting of Philippine independence. Mr. KEISS. Do you think you could possibly have better witnesses on the question of the capabilities of the Filipinos than the two men who have been governors of the islands? You would not impugn the testimony of General Wood and Mr. Forbes, would you? Mr. SCHAFER. It is possible that you could impugn them. You might say, relative to other testimony and other problems that came before the representatives of the people-you might raise the same point that you would not have impugned the testimony of a former high Cabinet officer. The CHAIRMAN. Do you mean to make a reflection at this point on the character of General Wood or Mr. Forbes? Mr. SCHAFER. I do not mean to make a reflection. I want to bring out information which I have heard rumors of, and if the witness has any information that could enlighten me on the subject I would like to bring that out. This is a vital thing in the consideration of the Philippine independence-the report of General Wood and Forbes. The CHAIRMAN. If you will permit me, the chair has ruled that your questions are competent, and I think the chair saw the purpose toward which you were moving, and therefore we ask the question whether you intended to question the motives that inspired General Wood and Mr. Forbes in making that report. Of course if that is true, common decency would mean that General Wood and Mr. Forbes should have an opportunity before the committee to give their own testimony on matters of that kind. You may proceed, however, with your questioning, which I think is not at all incompetent. Mr. SCHAFER. I have asked the last question I want to ask at this time. but I will further state that I, as one individual, would be only too glad if this committee had an opportunity of having General Wood and W. Cameron Forbes before us to testify on this question. Mr. RAGON. May I ask a question? The CHAIRMAN. Yes. Mr. RAGON. You stated something about the constitutionality of this question, whether or not they could be allowed independence in the sense that they were to be just cut loose. Have you given that question serious study? PHILIPPINE LOCAL AUTONOMY 38Z Mr:. $SIFT. Ini my own mind.., ', -:' X Mr-. RtGON, A-re.you anl attorney - -' -. M ri SWIFT. I was onee. - * *, * '' ','.- '-,;.' 'j':'. 't Mr. RAGON. I mean to do this for information onily. I. wantto know if your opinion is a mere lay opinion or one the result of stuby? MrP SWIFT. When I practiced law twenty-odd years ago weJ understood the Constitutidn a little, differently from, what it is undersood now.- There was more respect paid the constitutional limitatioris, and on congressional and legislative action, and perhaps I retained some old-fashioned ideas, but in my opinion, basedt on my former instinct which I acquired a number of years ago, which as I have stated --- Mr. RAGOs'..- What I want to.do is to get these facts. It am not asking.ttheses questions except for my own iinformation and for the mnfbrfoation of the.ie: se.,: -:' ' '; Mr. Swimr'.i Iwill gladly do a-l, I can tt answer them.::'; ~;' Mr.:IR osN: Have ybu1 ever istudied the- source fromi.hich' -the United StAtesderived the power toracquire this property? - Mr. SWIFT. They acquired it by conquest-force 'and' violencw, if you ddsire. - - ' * - f ' Mrii RAON.: Where-did: -they 'get'. '.,,t hat?....j -.:."t:,: '. ir. Swi-. r I do not know, utnless it, is inherent in any sovoreiigty Mr. RAGON. If it is inherent in any sovereignty,-why'shouldhitt'in8 be inherent in the same sovereignty to dispose of, {t? Hatvet'ou st:udied that? i';- / \'' Mr. SWIFT. I have thought, aubbut it. ^ i; Mr. RAGcOx. IHave y uIthought about where the soiiice of aiftlhoity is to cede a section of Maine, -whih was transferred, 'a part:f 'th' territbiv. of 'the State 'of 'MAine,:hi'dih was an integral part of the State?;~.: - 7;.. Mr. SWIFT. You:mean in the botmdai-y 'disptt twith Grieat Bitiatn?i Mr. RAGON. Yes.-. * Mr. SWIFT. That iB a diTfhere t thlng. The iTitnd Stvtgi eAMld not cede away any part of Maine that was admitd,.to be Utiit-dl States territory butiit witas a1 questiotn of -vhthetertiat was" MAifne or Canada, and it. was deeided -b*airitration that; it was: nt Maite, ibut was Canadaf,. and le;Unite d 'nStite at did 'not ctde at:Rta;i tT ed States territory that was admitted to be United States territ' I. They atr 'edit was not Maine but Cala.;: ' ' -Mr.. RA 1)o. youi 'say- that the United tStates conneoedd that ws; a part of Canada?. - i; - Mr. SWIFT. Yes; I imagine So. WASr niot the questiOn subtittetto arbitration and decided t;::;. Mr. RAGooN. The United States oeded that,part, find never 'id release their right to claim; -bt they' ceded that part.. i Mr. SWiFT. Those thlings were Sett.led with Canada. Mr. RAGON.: Have. you: ead the'.ase of Delaiey- against 'Biddell, a Porto Rico case, and the Alaska' case of Rasmussen againsti sime one1, in which this very thing Was discessed:?:, ': J;. Mr. SWIF'. If I havi, I have forgotten. It is ro use recititg aty ' Mr.; RAGOX. What' ihvestigations haveyou made?: That is. whht YI want. r I: want to ' ask' if: you do Bioti khow the Conttittiori 'of the United States' does tnft give any 'aithority anywhere fo!r 'he, qiwisi:'. tion of any territory?... -.i -.s;. i 38 PHILIPPINE LOCAL AUTTONOMY Mr. SWIFT. It may be, except as inherent powers of sovereignty. Mr. RAGON. That is one of the reasons; but they might have that power under the power of Congress to declare war or for the President to make treaties. Mr. SWIFT. Yes. Mr. RAGON. If they have that power as an inherent right of sovereignty, or the power to make a treaty by the President, or in Congress to declare war, could not they by the same power release those things Mr. SWIFT. I think that personally-my own feeling goes to the personal side, the human side, rather than the real estate. If they had simply by force of their conquest acquired these islands, and no people were living on them, then I should say they probably could release them. They could sell it, or do anything they pleased; but having taken in over 11,000,000 people, and having maintained that sovereignty for 20 years, during which 5,000,000 or 6,000,000 Filipinos have been born, who have never known any other flag, it is a different question. Mr. RAGON. Under your treaty between Spain and the United States, does not that treaty say that Congress shall have the right to establish the civil rights and political status of the inhabitants of the Philippine Islands? Mr. SWIFT. Yes. Mr. RAGON. Now, suppose Congress wanted to say they were free and independent people, what would be their status? Mr. SWIFT. If they had established that on the start, it would have been right. They fixed a status under the treaty by the provision that they declared the Filipinos to be citizens of the Philippine Islands, which was United States territory, and as such entitled to the protection of the United States. They fixed that status, and I say fixed it for all time. Mr. RAGON. You do not think Congress would have a right to repeal or modify it Mr. SWIFT. Once you have made a United States citizen, I do not think you can expatriate him. That is my opinion. Mr. RAGON. You do not mean to say the Filipinos are citizens of the United States? Mr. SWIFT. He is a United States citizen of the Philippine Islands, and the Philippine Islands are United States territory, and you can not get away from it. Mr. RAGON. Can you find any justification for that in any construction of the Constitution of the United States? Mr. SWIFT. I can not find anything that militates agains t it. Mr. RAGON. I can find you some if you will read those two cases. Mr. SWIFT. While you are on that point, I have considered the question of citizenship quite a long time and a lot, and I have read some definitions of citizens, and a broad definition-I do not remember if I am quoting from the Supreme Court, but this is a numnber of years ago. Citizenship is simply a relation consisting of allegiance on the one hand and protection on the other, and when the United States became a sovereign of the Philippine Islands and receiveed the allegiance of the Filipinos and guaranteed them protectin- thatmalde thern itizens. We could make no other citizens but citizens of the United States. PHILIPPINE LOCAL AUTONOMY Mr. REGAX. I think you are confused as to the degree of allegiance they.owe. CGo a little step further-in that. With referenie to Cuba, the United States took sovereignty over Cuba for a while, did they not? Mr. SwiFT. I do not think they did. Mr. RAGON. They did not? Mr. SWIFT. No; they did not. I do not believe they did. Mr. RAGON. The difference between the Philippine Islands and Cuba - Mr. SWIFT. Do not cross-examine me on Cuba. Mr. RAGON. The difference between the status of the Philippine Islands under the treaty and Cuba was when they said. "We cede to the United States the Philippine Islands," and under the other they said, "We relinquish sovereignty over Cuba," but when Spain relinquished sovereignty the United States elected the Governor General and retained sovereignty over Cuba for four years, from 1898-to 1902, when we gave it up.. Mr: SW Ir. m it sufi ly aequai te With that:o Oradict you. I have not those in mind. Mr. WILLIAMS. I would like to ask one more question. Mr. Swift, you recognize the fact that a citizen of the United States, you or I1 or any other citizen, can relinquish our citizenship by declaring allegiance to any other government? Mr. SWIFT. Yes, sir. Mr. WILLIAMS. If we can do that individually, could not the people like the Filipino do it, as a whole, if it is agreeable to our Government? Mr. SWIFT. Well, we are getting a little bit theoretial. I can't imagine any circumstances myself under which you- can expatriate citizens. -Mr. MACLAFFERTY:. I would like to ask the gentleman, in reference to. Mr. Williams' last question, if that was not tried in 1861? Mr. WILLIAMS. You did not listen to me. I said with the permission of this Government. In 181l we did not have the permission. Mr. KENT. I am tvery interested in knowing whether your peole, the people with whom you are connecteed, have received any brief of the law upon this subject: on the question of the sovereignty as it was exeriis ed;1by this countiy over the Phiippies. Mr. SWIPrT No, - *?.:;. Mr. KENT I:may say to the witness that I have heard that question raised so frequently that I;myself have given it sonme thougt4 some little investigation. Do I, understand you, then~ that:under the treaty-making power, land,the, power to make war; prior to the necessity for: the establishmeat of the, treaty, whieh is Ahe highest possible law of the land, under the Constitution, that' the Philippines were definitely ceded in fee simple,as the tstle to the larnds was ceded to; this country?: ',M r. /Swwc 9 The Supreme~ Court of the UiTed,States, in som cases —I do. no remember what t hey t werw-adeid that!.s a i result of -whatever happened thaere the. Plilippines Jcamte:lnitd, States terryo thuThat has ben -decided- i' ' *in ' jhotw. iB.-KmN i Now, tjust.)wnenti, J (ndert A, ith-t, your thought is that under this treaty, this treaty-making power, 40 PHILIPPINE LOCAL AUTONOMY the title to this land was ceded to the Unied States, or that we merely exercised a. qualified supremacy for protectorate purposes, for the purposes of protection over the island? Mr. SWIFT. Quoting from the United States Supreme Court, they said "thereby the Philippline Islands became United States territory." Mr. RAGON. But was not incorporated into and made a part of the United States. Mr. SWIFT. Not Incorporated into, the old territorial limits of the United States. Mr. RAGOC. Not incorporated into the old territorial limits. That is right. Mr. SwIFT. It became the territory of the United States. Mr. RAGONx. Yes: but not an integral part of the United States. Mr. KENT. Just a moment. You understand the method of the acquirement of Florida, the Louisina.na Purchase, and all the other acquisitions of territory out of which our Territories and States were eventually raised: that that land, as Mr. Ragon has said. eventually was ceded to the United States, became a part of the United States. You do not mean to say that under the treatymaking power we took over the title to the lands of the Philippine Islands? - - Mr. SWIFT. I mean to say that under whatever happened we acquired title to the land and sovereignty over the people, and th-lt has been decided by the Supreme Court. Mr. KEISS. I would like to ask Mr. Kent a question, if he' keeps: in mind we paid $20,000.000 at the time we took these islanlds ove r: in other words, did we not reallyt buy them in fee simple, almost? Mr. KENT. There is no doubt of that. The question of treatymaking power, however, is one that is in mv mind. I am trying to find from this witness, and I would like to have him answer, whether he thinks we have no more right to dispose of these islands. absdlutely divorce ourselves from them, any more than we ha-ve the right to dispose of the State of Pennsylvania. Mr. SWIFT. That is my opinion. Mr.; KENT. You go to the very limit and to the extreme. Mr. SWIFT. That is my opinion. The CHAIRMAN. Permit the chairman to make an observationm. Thie hearings, of course, are on my bill. I have wanted these men to be heard, as being familiar with the conditions in the Philippines. I want to say, however, that the chairman received some time ago a brief on that very subject. Personally mv own conviction has been, and I am not a lawyer-sometimes lawyers differ, and even laymen sometimes differ from the judgment of a lawyer. I can understand how the State of Pennsylvania, having become a part of the sovereignty itself — Mr. RAGON (interposing). An integral part. The CHAIRMAN. An integral part of the sovereignty itself can not be alienated, but certaiily it is vastly different with a territory that never has become in any sense a part of the-sovereignty, which is yet, absolutely dependent and subject to national authority, it certainly must be different; and therefore I am afraid that my bill, which: contemplates ultimate independence, if they want it. or continue the PHILIPPINE LOCAL AUTONOMY 41 unity with this Government, is not in any way unconstitutional. I think it is absolutely in harmony, not only with the Constitution but with the spirit of every republic. I wanted a clear-cut conception of the position of the chairman on this matter. Mr. KIESS. I think probably the witness has in mind more of the moral right than the constitutional right. Mr. SWIFT. My original purpose was to call the attention of the committee to the very serious question that you have got before you, whether on strict interpretation of the law I am right or wrongif you should decide at any time to cut the Philippines off from the United States, you are expatriating 11,000,000 people who have a status which, if not identical with your status as citizens, is a status that assures them constitutional freedom you rob them of a political status which is tantamount to the status of citizens of the United States, unless you continue the guaranty of the United States to protect them.... Mr. MILLIGAN. YOU do not contend that the Filipinos are citizens of the United States, do you? -. Mr. SWIFT. I contend they are United States citizens of the Philippine Islands... Mr. MILLIGAN. I do not see your distinction.. Mr. SWIFT.. That is because the United States created them that. What kind of a citizen do you call them? Mr. MILLIOAt. I say they are not citizens of the Umnted States, because the Constitution says what a citizen is, and unless therel is, some affirmative declaration of citizenship to the Filipinos, then I do not see how theyit an be citizens of the United States.:= it; 5 Mr — SIT. What doxtyou call tem fl l Mr. M;Lt. i: w-uld:-d say:that they were mere wards of:. the United States. Mr. SWIPFT. I do not care. The word "ward" and "citizent" are very much the same thing. Mr. MILLIGAN. There would be a lot of difference in my mind. Mr. SWIFT. The protection of;the United States is the thing that gives the status to the citizen and gives the status to the waird. It is all the same thing. There is little difference between ward and citizen. The CHAIRMAN. There is in the mind of many people no definite status, and it is because there is no definite status and because of our interest in the Philippine Islands, because of that lack of status that we are considering this measure. I think that is probably a fair statement of the situation.: Now, we have another witness here. Mr. SWIFT. In the excitement and discussion of this question I forgot to say one thing on the practical side of the question. It is a matter of very great importance to investment in the Philippine Islands and to encourage the development of the Philippine Islands that the status should be fixed, and now I have finished. The CHAIRMAN.. The hour has come when I think we should adjourn. We have Mr. Sweitzer here, who has a very carefully prepared statement. I presume we can meet to-morrow at, 10 oclock and continue these hearings. (Whereupon, at 12: o'cock m., the committee adjourned until to-morrow, Friday, May. 2, 1924, at 10 o'clock a. m.-);. 42 PHILIPPINE LOCAL ATUTONOITMY COMMITTEE ON INSULAR AFFAIRS, HOUSE OF REPRESENTATIVES, Friday, Ma.y 2, 1924. The committee this day met, Hon. Louis W. Fairfield (chairman) presiding. The CHAIRMAN. Gentlemen of the committee, without objection the hearings will proceed. There was an incident that occurred yesterday in connection with the hearings, developed by some questions propounded by Mr. Schafer, in relation to Governor Forbes and General Wood. I felt at the time that it would be very fortunate, indeed, if we could have a witness before us who knew the relations, if any, which those men sustained to J. G. White & Co. Mr. Pardee, of New York, is here this morning, who is a member of J. G. White & Co., who will be able to make an accurate statement in connection with the question that was raised on yesterday. We will now hear from Mr. Pardee. Mr. RAGON. Let me suggest that we wait until Mr. Schafercomes in before asking him any questions. Mr. WILLIAMS. We meet at 11 o'clock this morning, and I suggest that you have another witness, that we hear him. The CHAIRMAN. Very well. We -will pass that over for the present. (At this point Mr. Schafer entered the room and Mr. Pardee was called to make a statement.) STATEMENT OF MR. JOHN H. PARDEE, PRESIDENT OF THE PHILIPPINE-AMERICAN CHAMBER OF COMMERCE AND PRESIDENT OF THE J. G. WHITE MANAGEMENT CORPORATION Mr. PARDEE. I am president of the J. G. White Management Corporation, which looks after the administration and operation of the Manila Electric Co. and the Philippine Railway Co. in Manila. Governor Forbes-ex-Governor Forbes-has no connection with J. G. White & Co. or any of our companies in any way, shape, or manner. General Wood has no connection whatever. Two years ago last winter when I visited the islands I had negotiations with General Wood and with the Philippine government regarding the supervision of the operation of the Manila railroad, which is owned by the Philippine government. Those negotiations spread over two months and were finally concluded by the fact that the Filipinos very vigorously opposed such an administration contract. There was no proposition to buy the railroads, no proposition to lease the railroads, but simply to look after the operation of same, as we do the Philippine Railway, and when the Philippine government strenuously objected tothat for various reasons, which then appeared quite sufficient, we withdrew our proposition. Mr. Swift in his testimony said it was withdrawn by General Wood, which is not quite correct. That is all I wish to state. Mr. SCHAFER. You stated that Mr. Forbes had no connection with J. G. White & Co. At any time has Mr. Forbes been connected directly or indirectly with J. G. White & Co. or in their employS PHILIPPINE LOCAL AUTONOMY 43 Mr. PARDEE. No, sir: I have been with them-since 1907. Mr. SCHAFER. When J. G. White & Co. enters into the railroad business, such as they tried to enter into the management, as you said, of the Philippine Railroad Co., just how far does their interest go when they do enter into such management? Mr. PARDEFE. It is a matter of contract, and they receive so much a year for personal services in regard to management, the same as the Philippine Railway and the government railway in Nieaugura. Mr. SCHAFER. You have really the railroad under your control when you have the management? Mr. PARDEiE. As far as the operation goes, subject to the orders of the board of directors. Mir. SCHAFER. You buy material and fix the freight rates and things like that? Mr. PARDEE. No, sir; the board of directors decide the freight rates. Mr. KNUTSON. You stated General Wood withdrew your proposition? Mr. PAkRDFE. No; I did not. I beg your pardon. I did not attempt to say that. I said I understood Mr. Swift to testify yesterday that it met with the disapproval, or something to that effect, of General Wood. Mr. KNUTSON. You said that Mr. Swift's statement-I did not hear it-that it was not quite correct. Mr. PARDEE. Since that particular period he has not been a member of the firm of J. G. White and is not familiar with those negotiations. Mr. KNUTSON. Then it was altogether incorrect? Mr. PARDEE. Well, I can not tell you all the statement, because I have not read the testimony, but I said as to that particular thing it is incorrect. Mr. KNUTSON. Your people withdrew your proposition? Mr. PARDEE. Yes, sir. Mr. SCHAFER. To your best knowledge and belief was General Wood advocating that J. G. White & Co. take over the management, as you stated, of the railroad. Mr. PARDEE. Yes, sir. Mr. SCHAFER. He was an advocate of turning that railroad over to J. G. White & Co. Mr. PARDEE. The term, "turn over," I do not want to use it, if you mean it in the way I do. Mr. SCHAFER. I would say he was an advocate of having J. G. White & Co. operate and manage the railroad, as you have explained. Mr. PARDEE. Manage the operation of it? Mr. SCHAFER. Manage the operation of it as you have explained that they do. Mr. PARDEE. Yes, sir. Since that time the board of directors of the railroad company have elected, so I am informed, Mr. Hancock, who is connected with the Philippine Railway, and is our representative there. Mr. ScHwAEtR. J. G. White & Co. is interested in many railroads in the United States, are they not? Mr. PABDEE You mean steam railroads? Mr. SCHAFER. Electric railroads. 44 PHILIPPINE LOCAL AUTONOMY Mr. PARDEE. Electric railroads we are interested in. Mr. SCHAFER. Are they interested just to such an extent in the management as contemplated in the Philippine Railroad? Mr. PARDEE. In some of them we are. Mr. SCHAFER. Is that the same firm as the J. G. White & Co., which is reported as being interested in the proposed bid for Muscle Shoals? Mr. PARDEE. Mr. White is personally interested in that. Mr. SCHAFER. Not the company? Mr. PARDEE. No; not the company. Not that I know of. I do not think it is. Mr. KNUTSON. TWhat are the. banking connections of J. G. White & Co.? Mr. PARDEE. The banking connections? Mr. KNUTSON. Yes; in New York. Mr. PARDEE. The management corporation has banking connections in the Equitable Trust Co., the Seaboard National Bank. Mr. KNUTSON. I am not interested to know where you have your accounts, but what banks in New York finance your operations. Mr. PARDEE. Well, it would be pretty hard to give a list of them. Mr. KNUTSON. The City National? Mr. PARDEE. I do not think the City National has any interest in any of our affairs, or finance any of our operations. Mr. KNUTSON. Chase? Mr. PARDEE. I do not think the Chase has. Mr. KNUTSON. Chemical? Mr. PARDEE. I think we have a bank account at the Chemical, but they do not do what is called financing. Mr. KNUTSON. Any of the large New York concerns financially interested in your organization? Mr. PARDEE. Large financial concerns? Mr. KNUTSON. Yes, sir. Mr. PARDEE. No, sir. Individuals are stockholders in our company, and I presume are connected with banks, but no banking institution has any control of our company. Mr. SALMON. Has your company at any time had control of the operations of any of the railroads in the Philippine Islands? Mr. PARDEE. Yes, sir; we have to-day, subject to the board of directors. Mr. SALMON. To what extent, all the road or a part of it? Mr. PARDEE. There are only about 135 miles of track, and there are two branches. The Philippine Railway is the name of the steam railroad on the Island of Peinau and the Island of Cebu. The CHAIRMAN. I have requested Mr. Gilbert, of New York City, to appear as a witness before us this morning. and you will pardon me if I make a brief statement as to how it happened that Judge Gilbert is to appear as a witness, at my request. Judge Gilbert was raised in the district which I represent, indeed, in the county where I live, and we lived for many years in the same town. We have been friends for many years. Mr. SALMON. Mr. Chairman, I do not want to interrupt your statement. but I happen to remember that when' we adjourned yesterday the gentleman from the Philippine Islands, Mr. Roxas, was on the floor, trying to make a statement. PHILIPPINE LOCAL ALUTONOMY Mr. MACLAFFERTY. That was day before yesterday. I move that the chairman' proceed with his statement, out of courtesy to the chairman of the committee. Mr. SALMO- Sua I suppose. the chairman is satisfied with my cutting in at this time, as he gave his consent for me to:do so. Mr. MAcLAFrrEIET. I think the chairman should be allowed to finish his remarks uninterrupted. Tlhe CHAIRMAN. Mr. Roxas expressed a desire to withhold that statement until later, and I am acting in harmony with his expressed desire. There is no intention of not permitting him to come before the committee when he desires. Judge Gilbert was at one time lieutenant governor of our State, was then elected to; Congress from the district which I now represent, was subsequently appointed to a judgeship in the Philippine Islands, iwas a mnember of the commission which first visited the islands with Mr. Taft; I think I am stating that correctly. You were with the commission that went over with Mr. Taft? Mr. GILBERT. No; I was on the Philippine Commission later. The CHAIRMAN. Subsequently he was made Vice Governor of the Philippine.Islands. During the sickness and necessary absence of Governor Forbes he was acting governor. Mr. Gilbert turned the government of the Philippine Islands over to the man who succeeded him, Governor Harrison. I think that is a proper statement. You will see, gentlemen of the committee, that the witness has had ample opportunity to be conversant with Philippine affairs. I am very anxious, personally, to have him appear before this committee, because I have the utmost confidence in his integrity and his ability to measure the conditions over there, and for the further reason that so far as I know, and I think I am correctly informed, Mr. Gilbert has no financial interest whatever in the Philippines. He is not connected in any way with any firm doing business, or has he any business in the Philippines, and therefore he will be an impartial witness. I have the pleasure of presenting to you Judge Gilbert, of New York. STATEMENT OF HON. NEWTON W. GILBERT, OF NEW YORK CITY Mr. GILBERT. I do not come here with any prepared statement at all. I came here entirely at the request of Mr. Fairfield, after receiving a telegram which reached me in New York yesterday afternoon. I may state that I meet a lot of my Filipino friends, some of whom I have not seen for a long time. I was out there 11 years. I plead guilty to having. held these; various offices, but if I may say so in this presence, I am entirely reformed. I: do not hold any office now. I feel, of course, 'being there so long, that I know the Philippine Islands pretty well, and all the people of any importance in the Philippine Islands. Mr. Roxas, who represents the Philippine Commission, the last tine I saw him he was just a kid. -He was a very smart kid and 'a nice kid, but he was: just a kid.,. - I had the pleasure 'of organizing out there the young men of the Philippines- into an association which. they 'Iamed the Columbian Association.: 'It included, I think, about every young man in the 46 PHILIPPINE LOCAL AUTONOMY Philippines who was worth while, who had reached the point in education and experience so that he was valuable. It is really my greatest achievement in the Philippines, in organizing that society in my house that night, and these men have come along very rapidly, and they are now men like Mr. Roxas, Mr. Labadia, and these other men are really the men to whom you are listening with regard to the Philippines. I am prepared to try to answer any question you ask about anything I know. Mr. SALMON. How long has it been since you were in the Philippines? Mr. GILBERT. I left the Philippines in 1916. I turned the government over to Governor Harrison, and then, after taking a little vacation, I went out there and stayed three years practicing law with a law firm, which perhaps is the oldest American law firm in Manila. It was organized by the Caudert Bros.. of New York. They since dropped out of it, and new men have come in, and that firm is still there, and I was a member of it for three years, and then I left in 1916. Mr. WILLIAMS. Did you understand that this committee is considering a bill here to grant the Philippine people independence at present, or within the shortest time possible, or within a term of years? With your knowledge of the conditions there, and your judgment, we would like to have your ideas as to whether you think those people are fitted for self-government, should be made an independent people, if so, why, and if not, tell us why. Mr. GILBERT. I have read this bill that your chairman introduced. He sent a copy of it to me a couple of days ago, and I read it over and I am more or less familiar with it. I have not examined it in great detail. I think it is fair for me to say that I know these men in the room, whom I lived amongst, while I was in the Philippines, will agree with me that I was never an advocate of immediate or prompt independence. I felt that the time had not arrived when it was fair to the Philippine people. I may say to you so that you will not misunderstand me. in my residence in the Philippine Islands I learned to have a oreat deal of respect for the Philippine people. They have so many qualities that are attractive, their desire for education, their hospitality, their kindness of heart, and my fundamental thought always was, and I think it is the thought of all officials out there, what is best for the Philippine people, and I did not believe and I do not believe now that the time has come when they ought to be left alone. In the first place, I do not think they could be economically independent. It would be a terrible blow economically to the Philippines if we should now withdraw and leave the people in no better position as to markets than any other outside people; but I sympathize with their desire for independence, and I do believe that although perhaps none of these statement called promises, such as given by McKinley, Taft. Roosevelt, or somebody else, are technically exactly promises, yet I believe those statements were construed by the Philippine people and by a good many American people as promises that at a suitable time we were going to withdraw entirely from the islands, and I am not willing to stand on the technicality to say those promises were not made; but an indefinite promise as to when they shall have their PHILIPPINE LOCAL AUTONOMY 47 independence is not advantageous to the Philippine or to the Am'anri.can people. It leads us to a state of confusion.; I i The situation out there now is not ideal by any manner of means, and it seems to me this is a situation that must continue more or less, until there is a definite time fixed, and a definite arrangement made that everybody will know, the Filipinos will know, the Americans will know, the business men of both countries will know, that at' a certain time if the Filipinos then desire to be independent, desire to severe all relations with us, they may do so. Mr. RAGON. What do you mean by situation-political, ecQnomical, or what?:;.. Mr. GILBERT. The situation out there is not ideal, because under the Jones bill there are so many questions as to what authority is in the executive and what is in the legislative branch of the; governmenti I know only about that as I know it in the nswspapers and it ihas been told to me, that it has led to a situation that does unot help anyr body. That- is what I mean by that.: I have not the' slightest financial interest in the Philippines -;. i' - Mr.. RAGONI. Do you think it is the, situation of the relationship between our Government- and their local governmenti?!,' i. I i i Mr. GILBERT. I mean the; relationship between the- legiStative end of their government, and the executive end of theirigolernetent there.' ' Mr. SCHAFER.' Do yout not thinkl by; granting,them independbhce and removing our executive end down there, it would ickar. up thb bad 'conditions existing? i Mr. GILBERT. It would let us out, but look what it waoud do to the Filipino. It would leave him without.support of the Urlited States. He could not go out in the markets of the. world aaidget money as he did in this country a short time ago unless Amifica *'as behind him. He could not' send his: sugar here free. He.wouldf be handicapped in a:great many ways. ^ r. The Filipino people such as you see in this room, ninteligent, thoughtful fellows in iy judgment,. do not Want to do anything that will precipitate a crisis for their own folks, They want toibing about a condition which will enable them to constantly develop and progress and have a full measure of independence when the ti.me comes when;they can ecomonically and otherwise support it. There is no question about the mental capacity of many Filipinos: to conduct their' own government, but there is a question as to their economical capacity. Mr. KNuTSON. How do the Filipinos compare, with the Japanese? Mr. iGmILERT. In what way?:: 'I Mr. KNUTSON. In capacity for self government? How would the island resources compare with those of Japan?:If the Filipinos have large uindceveloped resoturces, they could get capital, if not American capital, they could get British and French capital. Mr. GIIEr.T. I do not like to compare the Filipinos with the Japanese. They are different people. Filipino people are people that I like. I will not savy that about everybody in the world. I do not like to compare the two. Of course, the Japanese have progressed very well in their way, but the Japanese have had ioppor-: 01692- 24-4i —; ',:. - 48 PHILIPPINE LOCAL AUTONOMY tunities to progress for scores of years that the Filipinos have not had. The Filipinos' opportunity never came until American occupation. The Filipino under Spanish rule had no opportunity, and every Filipino in this room will say that is true. He was not given an opportunity for education. It is wonderful out there to see what the. Filipino thinks about opportunities for his boy and his girl. We do not have to have any compulsory education law in the Philippine Islands. Every parent will make every kind of sacrifice to have the children in school, and they do make sacrifices. We have not been able to provide for all of them, although we now have a million children in school in the Philippine Islands learning English, getting a common language. A country can not go very far without a common language. They have got to be able to converse with each other from Province to Province and from town to town, and that opportunity they did not have. The younger people are getting a common language. It does not matter if it is English or Spanish, or what not, if it is a language of literature and background, but the only language possible for the Americans to introduce was the English language, and so, gradually, year by year more and more people in the Philippine Islands are coming to adult age who speak to each other and understand each other. Mr. RAGON. You have not been there since the Jones law was put into operation? Mr. GILBERT. I left there in 1916. It went into operation in 1916, I think. I left there just about the time it went into operation. Mr. RAGON. You have no actual knowledge of the workings of the Jones bill, except such as we have here? Mr. GILBERT. I suspect I have had better opportunities for observing it than you. Mr. RAGON. By reason of your past experience? Mr. GILBERT. I can understand that better than a man who has not lived there, and everybody that comes from Manila or the Philippine Islands, I am glad to say if he is an American or Filipino, comes to see me in New York, and we sit down and talk it over. I talk Philippines as long as anybody will stay. I think I have had a better opportunity to know about it than any man who has not had that chance. Mr. KNUTSON. Was it your observation while in the Philippines that a person's opposition to independence, these outsiders' opposition to Philippine independence, was in proportion to their investments out there? Mr. GILBERT. I do not think that had anything to do with it. Mr. KNUTSON. Then it is different from some countries I know of, where foreigners have investments. Mr. GILBERT. I do not mean to say the men who had investments out there were for independence. The men who had investments were not for immediate independence. You have had a very wonderful lot of Americans in the Philippine Islands to conduct the business of this Government. They have been an unselfish lot. I do not mean every one, but I have never seen, and I am reaching an age now and have had experience enough so I have had a chance to see, and I have never seen Government servants any more unselfish and devoted to trying to solve the problems correctly than the American officers in the Philippines, PHILIPPINE LOCAL AUTONOMY 49 and I believe that statement will be supported by the Filipinos who are present. The prime purpose of everybody was " what can we do best for the Philippines?" Mr. Taft enunciated the proposition that it was Philippines for the Filipino, and that has been the slogan of the American occupation of the Philippines. I do not think any other country in the world in its colonial history has conducted its affairs so as to keep its colonials in mind as first. Mr. MACLAFFERTY. Has this Government ever profited as a Government, financially, by our sovereignty in the Philippines? Mr. GILBERT. They have not directly, certainly. Mr. MACLAFFERTY. Have the Philippines been a bill of expense to the United States? Mr. GILBERT. Well, I have always claimed not, but it is chance for argument there. We have kept troops there. We have not had troops there for a number of years because we needed them for the Filipinos. Mr. MACLAFrERTY. Has the Government profited by the Philippines? Mr. GILBERT. Not at all. Mr. MACLAFFERTY. Have we not put in many more millions, as a Government, than we can get out? Mr. GILBERT. It is not a question of what we will get. Mr. MACLAFFERTY. Out attitude of the Government is a wholly unselfish one; we have put in many more millions of dollars than we have or ever can get out of the Philippines. Mr. GILBERT. Of course that is true. Mr. KNUTSON. Why cling to this bill of expense? Mr. MACLAFFERTY. I am as anxious as any man to get rid of it, but in the right way, but our Government has not, as some governments have done in the past, collected tribute, therefore we have no selfish reason, as a Government for wishing to keep the Philippine Islands. Mr. KNUTSON. No sane person would ever charge us with that. Mr. RAGON. What the gentleman from Caifornia has brought out may be true as to the Government, but do you think the same would hold good with reference to large investors? Mr. MACLAFFERTY. I do not know. Mr. RAGON. I am asking the gentleman, Mr. Gilbert. Mr. MACLAFFERTY. I beg your pardon. Mr. RAGON. That same rule might not apply to the men who have large sums of money represented over there. Mr. GILBERT. I think some American investments have been profitable, and some have not been profitable. Mr. RAGON. I mean with reference to a selfish purpose of keeping them under the United States. Mr. GILBERT. There has not been any exploitation of the Philippine Islands by American capital. I would imagine the Filipinos would be very pleased if more American capital would go out there. Mr. SCHAFER. You say there has been no exploitation. Have there been attempts at exploitation which were forestalled through the alertness of the Filipino people or their legislature? Mr. GILBERT. Well, I do not know of such a case, but it is quite possible some selfish men may have tried. 50 PHILIPPINE LOCAL AUTONOMY Mr. SCHAFER. I would like to ask you a few questions: you have been over there. To your best knowledge and belief, is there at present, and has there been in the past, a scarcity of investments of American capital on account of the uncertain status of the Philippine government? Mr. GILBERT. That is exactly the situation, sir, to-day. Mr. SCHAFER. There has been a scarcity? IM. GILBERT. Is now. Mr. SCHAFER. Do yOU think the bill under discussion will determine definitely the status, so that American capital will not be reluctant to invest in the Philippines as they have heretofore been reluctant? Mr. GILBERT. I believe if the time is long enough before the period when the Filipino may determine for himself whether he will cut loose from us, 30 or 40 years, that the American capital will go in, with the chance that they can go in and get out, if there is going to be independence there, and they desire to do so, at the time. The Filipinos may say, "We do not want independence; we want closer relations with the United States " then I believe capital will go in there. Mr. SCHAFER. If the status is determined as defined by this bill, it does not definitely state the Filipinos will becolne an independent people and nation, then by passing this bill in a comouflage way of determining the status a few years from now, if, as you say, the American capital will not be so reluctant, and will invest in the Philippine Islands, would not there be a great deal more opposition to the Filipinos for independence at the expiration of the time established by this proposed bill? Mr. KNUTSON. You mean there will be more money invested? Mr. SCHAFER. There will be more money invested, and there will be more opposition to Philippine independence at that time. Mr. GILBERT. As I recall the bill, it provides that the Filitpinos themselves will determine at that time. The fact that there was opposition, and somebody had investments there, would not preclude the thing being done, if the Philippines wanted it. Mr. SCHAFER. This proposed law, if enacted, will not become permanent, like the constitution. A succeeding Congress can nullify that. Mr. GILBERT. I agree that will be possible, but I do not believe that any American Congress, no matter how composed, would repeal or tend to destroy a covenant of this kind. I do not believe that is possible. Mr. SCHAFER. You believe, then, that if this bill, so called, defining the status of the Filipino people, becomes a law, that American capital and more American investments will go to the islands? Mr. GILBERT. I do. Mr. SCHAFER. Now, just one more question, and I think that is all I will ask. On April 15 the Secretary of War released a cable from General Wood March 14, which states in part, "Most of the serious defects pointed out by the Wood-Forbes report are in process of being corrected, but with great difficulties, and will require years for accomplishment, such as the development of natural resources and preparations for economic independence and preparations for national defense and the building up of individual civic courage." PHILIPPINE LOCAL AUTONOMY 51 Now, I would like to have your opinion as to just what conditions exist in the Philippine Islands to-day on account of which conditions General Wood would make a statement in substance that one of the arguments against immediate independence that the development of natural resources has not expanded sufficiently. Mr. GILBERT. I'confess that your question is a little involved. Mr. MACLAFFERTY. I would like to ask a question. Mr. GILBERT. I do not want to appear to be trying to evade that, but it is so involved that I hardly know what the question is. Mr. SCHAFER. I will ask it in not such an involved manner. Do you think that the natural resources have been developed to such a degree at present as would warrant granting them immediate independence from that standpoint? Mr. GILBERT. Already? Mr. SCHAFER. Yes. Mr. GILBERT. No; I do not. Mr. SCHAFER. Do you believe that the lack of preparation for national defense' should be used as an argument against granting Philippine independence? Mr. GILBERT. I think it would be very wicked to leave those people without defense, subject to the attacks that might be made upon them by some near-by neighbors that we have in mind. Mr. SCHAFER. We might, then, as well adopt the policy that at no time will we grant Philippine independence, because it seems impossible that there ever will come a time when they will be able to prepare themselves for actual defense over there. Mr. GILBERT. I do not think that follows, Mr. Schafer. I do not believe that follows. I believe, if given a sufficient length of time, there will be a swift, continuous development of these people. They are people that develop rapidly. I think they are going to, in 50 or 75 years of American preparation, develop like we did in 200 years. With sufficient time for that development, so that more and more Filipinos will be interested in business, with sufficient time for that development so that the industries will be increased, by reason of their opportunities to reach our markets, by reason of the opportunities they have had to borrow money, because of the credit of the United States, I believe as time elapses they will become more and more able to support themselves without danger from the outside, and with sufficient revenues to run the government correctly. You understand I am for independence, but not immediately. Mr. SCHAFER. They must have some tremendous resources to be able in the course of 30 years to maintain an army and navy to defend themselves from aggression of outside nations. Mr. GILBERT. Well, I do not suppose they will be able to maintain a navy or army sufficient to cope with outside nations, but I have a hope that their development will be such and that the aggressiveness of other nations may be so curbed in the meanwhile that they, without a navy equal to England or Japan, will be able to take care of themselves. I am thinking more of economic independence than martial independence. They can not have martial independence. Mr. MAcLAFFERTY. I would like to ask a question. I would like to ask a question of the gentleman from Wisconsin. You spoke of this bill in a way that 1 would understand it to be in your mind as a camouflage bill. Is that the gentleman's opinion? 52 PHILIPPINE LOCAL AUTONOMY Mr. SCHAFER. I say it is camouflage in my opinion, in so far as determining a status of the Philippine Islands. Mr. MACLAFFERTY. In your opinion our chairman introduced a bill intended simply as a camouflage. Mr. SCHAFER. No: I am not making that assertion. Mr. RAGON. I think these matters should be discussed in an executive session. Mr. MACLAFFERTY. I want an explanation. Mr. KNUTSON. I think those matters should be thrashed out in executive sessions. Mr. MACLAFFERTY. I wanted it to go in the record that tie gentleman in his opinion, said it was a camouflage bill. Mr. SCHAFER. I will say that I did not say that it is a camouflage bill in my opinion. I qualified that statement, and I want to reiterate it again. It is a camouflage bill o far as it determines the status of the Philippines. Mr. BEEDY. I move that we proceed. The CHAIRMAN. Will you please coine to order, gentlemen, or we will not be able to proceed at any time. I think the chairman is privileged to make an observation. I did not think Mr. Schafer meant to reflect on the chair having a bill for the purpose of camouflage. Mr. SCHAFER. No, sir. Mr. SALMON. Judge. from your experience in the Philippine Islands, and your knowledge of the progress that has been made there under the guidance of the Government of the United States, is it not your opinion that if this control is continued for 20 or 30 years, that in that time the Philippine people would be so thoroughly acquainted with American customs and development that they might not want independence at all, but might want to remain a part of the United States, territory of the United States. Mr. GIIBERT. That might be so. Mr. SALM3ON. Do you not think that is more than likely? Mr. GILBERT. Yes; to be frank, I do. This bill, as I read it, provides for immediately giving the Filipinos full control of the local government, of local affairs under the constitution. That will give a training in government that the Filipino has never had. A few of themn do not need the training, but the masses do. That will give him training in government at the end of that time, and that period ought not to be less than the time during which the bonds now out will mature, in my judgment. I think all of the bonds will mature in 30 years. Mr. SALMON. Do you not think the additional continued investment of American capital in the Philippine Islands in the next 15 or 20 years of itself would have the influence of discouraging Philippine independence? Mr. GILBERT. Only as causing the Filipino in some cases, at least, to feel that the advantages of not having complete independence would be as great as complete independence; some have reached that conclusion. Mr. SALMON. The power and influence of capital in any country has weight with the political sentiment, and political acts of the people, has it not? PHILIPPINE LOCAL AUTONOMY 53 Mr. GILBERT. Generally speaking, I should say so. I do not think any invested capital in the Philippines had much influence with native officials there. I do not recall any instances. Mr. SALMON. Evidently not, or they would not have appropriated $500,000 to have sent a delegation here to advocate independence. - Mr. GILBERT. I say I do not think so. Mr. BEEDY. Mr. Chairman, I would like to ask one or two questions. There is pending here. Judge, a bill offered by the chairman, one section of which provides, in substance that independence would never be consummated, so far as this Government is concerned, for the Philippines until treaties had been concluded with Great Britain, France, China, Italy, the Netherlands, because of near-by posses-, sions. In your opinion, would that be a consideration in granting independence to the Philippines? Mr. GILBERT. Well, I had not thought about that question, because it is new to me; but I would not be willing to do that. I am thinking out aloud. My opinion is not mature. I do not care to submit to any other nations in the world the question what we shall do. Mr. BEEDY. You stated here awhile ago, I think, that it would be wicked to leave these people in their present state, subject to an attack of neighboring nations. Now, if treaties were concluded with other nations whereby assurances were given respecting the sovereignty of the Philippine Islands, would that remove that? Mr. GILBERT. They might take care entirely of that phase of it, but it would not take care of the situation that the Philippine Islands would be left in if they did not have the benefit of the markets of the United States. Mr. BEEDY. The economic question, of course, is distinct and apart from that. Mr. GILBERT. Yes, sir. Mr. BEEDY. I presume you. would say that the Philippines, if granted independence, would be unable to raise sufficient money for taxes to sustain the government. Mr. GILBERT. TO sustain it in the manner it has been sustained; yes. It would sustain a government, I suppose. Mr. BEEDY. Do you consider the Filipinos to-day, under the leadership of the more educated, are capable of maintaining a government, not perhaps such a government as we would maintain but a government that might be reasonably expected from orientals under all circumstances? Mr. GILBERT. I think some of the men could conduct such a government. Mr. BEEDY. Somebody has testified, and I believe one or two perhaps, that conditions in Japan and China are very uncertain at pressent, unsatisfactory, a good deal of restlessness there; that those conditions are also prevalent in the islands, as they are in India and other countries: and within the next few years there is liable to be some trouble in that section of the world. Are you of that opinion? Mr. GILBERT. Well, I rather dislike to say that definitely. There is not any doubt that India is in a great state of unrest. I happen to be pretty familiar with that part of the world. There is not any doubt that the Chinese Government is not functioning. I would not say that about Japan. From what I read, a good deal of Bolshevism 54 PHILIPPINE LOCAL AUTONOMY has developed there, but I do not think the Japanese Government will break down. I do not know that any of them will. The demand for independence in the Philippines is not attributable to any of this radical world movement. I do not so regard it at all. The desire for independence in the Philippines is the natural attribute of man. We claim it governmentally and individually. We do not like to be controlled in any way. Mr. BEEDY. Judge, you said a moment ago if we grant them independence, that lets us out; if they were to be given independence on conditions that treaties are concluded with nations to which I have referred, guaranteeing their integrity and representing their neutrality, to which the islands are not a party, do you think it is proper for this committee to consider not only the well-being of the Filipino but consider just a bit our own interests? I think it is proper for the committee to consider the interests of our own country somewhat. Mr. GILBERT. Yes, sir. (Informal discussion followed afterwards, which the reporter was directed not to incorporate in the record.) Mr. BRUIMM. May I ask a question? Judge Gilbert, from the advantageous position you have had in relation to the Philippines, knowledge, etc., and as an ex-Member of Congress, if you were a member of this committee at present, knowing the two propositions for immediate independence and deferred plebiscite, speaking from the standpoint of the Filipinos, which would you support? Mr. GILBERT. The plebiscite. Mr. BRUMM. The 30-years deferred plebiscite? Mr. GILBERT. I would if I were a Filipino. I think a great many Filipinos will agree with me. You understand we do not do it in the interest of anybody in America. We do not do it in the interest of American interests. I do not represent any of these people. I am not employed by them, and they do not pay me anything. I do it in what I believe is the best interest of the Philippine people. Mr. KNUTSON. The thing I object to is this growing tendency on the part of the American Government to step in everywhere and anywhere on the least provocation. We throw marines in, seize the customs, abolish their congress, lock up the halls of government. For God's sake, are we going to play Santa Claus to the entire world? Mr. RAGON. Judge Gilbert, you were saying from your own experience in the Philippines as Assistant Governor General, or whatever it was-are you familiar with the attitude of the most recent Governor General of the Philippines, what his attitude would be on that? Mr. GILBERT. General Wood? Mr. RAGON. Harrison. Mr. GILBERT. I have not seen General Harrison since I was in the Philippines. Mr. KNUTSON. Did you read his book? Mr. GILBERT. Yes. Mr. RAGON. What is his attitude on it Mr. GILBERT. I think it is for immediate independence. Mr. RAGON. Then really your opinion is just the opinion of one American, one line of thought, and it may be opposed by many Americans of another line of thought. PHILIPPINE LOCAL AUTONOMY 55 Mr. GILBERT. Very true; but I do not think this proposition, such as contained in this bill introduced by the chairman, has ever been presented before to Congress or any Governor General. It is a sort of new thought to give them a constitutional government. Mr. KNUTSON. May I interject a remark? You say you do not think all the Filipinos are agreed that immediate independence is desirable? Mr. GILBERT. No, sir. Mr. KNUTSON. Is it a fact also that all Americans over there are not of the opinion that we should continue on indefinitely? Mr. GILBERT. The Americans over there, as represented by the American Chamber of Commerce, are opposed to independence at any time. Mr. KNUTSON. Is it not also true that a convention that met to select delegates within the last two months to one of the national conventions are on record as being in favor of immediate independence, and that convention was composed of Americans, at least the delegates selected are Americans? Mr. GILBERT. You will have to put your own construction on that resolution. I read it, and I thought it dodged; I did not think it was definite. I would not want- my business determined by that kind of a resolution. Mr. RAGON. You think the chairman's bill is the bill that we should pass? Mr. GILBERT. Yes. There may be some modifications that ought to be made. I have not studied it carefully. Mr. RAGON. I read here from the letter of President Coolidge, dated February 21, and released March 15: Thus believing, I feel that I am serving those same interests (meaning the Philippine interests) by saying frankly that it is not possible to consider the extension of a larger measure of autonomy to the Philippine people until they shall have demonstrated a readiness and capacity to operate fully and effectively with the American Government. There is not but one construction we can put on that, that the President believed they should remain as they are now. Mr. GILBERT. It very nearly said that. Mr. RAGON. The Filipino wants immediate independence, does he not? Mr. GILBERT. Some of them. Mr. RAGON. That is the only representation we have heard here from them. Mr. GILBERT. Yes; perhaps; I do not know that. Mr. RAGON. Then the President of the United States, under his written statement-and that is the only statement we have any right to rely on-thinks that he should not be granted this additional autonomy, and the Filipino thinks he ought to have it, and the American business man favors the Fairfield bill. Mr. GILBERT. The Fairfield bill seems to be a very nice compromise between the two positions. A compromise is really the right position. Mr. RAGON. If you were on this committee you would follow what these American business men would say and not follow what the President of the United States has suggested. 56 PHILIPPINE LOCAL AUTONOMY Mr. GILBERT. I would not follow either one. I would work it out for myself as best I could, and that would bring me to middle ground. Mr. RAGON. You would not want us to follow anybody blindly. Mr. GILBERT. No, sir. Mr. RAGON. You would not want us to follow your suggestion, that if you were a member you would support the Fairfield bill. Mr. GILBERT. No, sir. Mr. SALMON. From your acquaintance in the Philippines and your acquaintance with the Fairfield bill, if it were enacted into law, do you think it would stop the agitation on the part of the Filipinos and the Philippine government for a shorter time for independence? Mr. GILBERT. Yes, sir: I do. I think the Filipino people are as honorable as I a minute ago said Congress would be. If we do that it will be a covenant, and I believe the Filipino people would subscribe to it and vote for it, and we would have a state of tranquillity there for 30 years, and besides playing politics they would be given an opportunity to develop otherwise. That is my thought. The CHAIRMAN. I want to state that we have a request from Albert J. Quist, 44 Pine Street, New York, who has handled the bonds that were issued by the Filipinos. This is a request from him to appear before the committee. Of course, there is a sort of spirit of antagonism toward anybody who has investment interests, but as the chairman of the committee I assured the gentleman that the act was not a crime, in my judgment, at least, for men to have money invested in the Philippines, and it was not a crime for them to have taken the stand as to the pressing obligations of the Filipinos, and that, no matter whether the Filipinos go or stay with us, somebody, somewhere on the face of the earth, is going in there and furnish them money to develop their natural resources, and bonds will be issued, and, gentlemen, I do not know if I have trespassed in assuring that gentleman that this committee would give him just as fair an opportunity to be heard as we have given anybody else, and so, as I say, he is another witness whom we will have before us. I have a communication here from the Department of Justice, from the Assistant Attorney General, dated April 30, 1924, to the chairman of this committee, on the constitutional question of being able to alienate by act of Congress the Philippine Islands. I shall not take the time to read this communication, but I may say that in harmony with what I think has been the consensus of opinion of the major portion of the committee, the Assistant Attorney General's opinion is that Congress has full power to do whatever in its wisdom ought to be done, and I should like to lhave the opinion of the Assistant Attorney General made a part of the record. I have another letter from Mr. Kiess, a member of this committee. which I will read. (The papers referred to are as follows:) Hon L. W. FAIRFIELD, Chairman Committee on Insular Affairs. Hou.e of Represent tatires.. MY DEAR MR. FAIRFIEL): I am sorry that I will not be able to attend the committee meeting to-morrow, Friday morning, on account of being called out of the city. I take it for granted that the hearings on your bill will probably be completed to-morrow, and that at the next meeting of the committee we will PHILIPPINE LOCAL AUTONOMY5 57 discuss the merits of your bill, and also the Cooper resolution as amended. Will you please advise the committee that I have procured the information from the Bureau of Insular Affairs, War Department, that I was instructed to obtain. I will be glad to furnish this information to the committee and I expect to return to Washington Monday morning. I hope that no executive meeting of the committee will be held before that time, as I would like to be present in order to give the committee the information I have received from the War Department. Cordially yours, EDGAR R. KIESS. APRIL 30, 1924.__ Hon. Louis W. FAIRFIELD, House of Representatives, Washington, D. C. MY DEAR CONGRESSMAN: I have the honor to acknowledge receipt of your letter of the 25th instant, in regard to the question of Philippine independence; wherein you state it has been contended that it would be unconstitutional to grant independence to the people of the Philippine Islands. The Philippine Islands have never been incorporated into the United States as an integral part thereof. They are held as an insular possession, appurtenant to the United States, but not incorporated into the United States. See Downes v. Bidwell (182 U. S. 244, 341-2); Dorr v. United States (195 U. S. 138). The Constitution of the United States has never been extended to the Philippine Islands. It has been so extended to the Territory of Alaska by congressional enactment, Rasmussen v. United States (197 U. S. 516). Under the Constitution of the United States. Congress has complete control over Territories. It likewise has such control over insular possessions, and may do with such possessions as it may see fit. If Congress deems it expedient to grant complete independence to the people of the Philippine Islands or a limited independence, it may, in my judgment, do so. On the other hand, if Congress should deem it expedient to incorporate the Philippine Islands as a Territory of the United States, extending to it the provisions of the Constitution of the United States, I think undoubtedly the povrer exists in Congress to do so. For a recent discussion of the status of the insular possessions of the United States reference is made to the opinion of the Supreme Court, delivered by Mr. Chief Justice Taft on April 10, 1922, in the case of Balzac v. People of Porto Rico (258 U. S. 298.) I trust the foregoing will assist you in determining the question now before you. Respectfully, (For the Attorney General), ALBERT OTTINGER, Assistant Attorney General. The CHAIRMAN. We will meet to-morrow at 10 o'clock. (Whereupon, at 11.05 o'clock p. m., the committee adjourned until to-morrow, Saturday, May 3, 1924, at 10 o'clock a. m.) COMMITTEE ON INSULAR AFFAIRS, HOUSE OF REPRESENTATIVES, Saturday, May 3, 1924. The committee this day met, Hon. Louis W. Fairfield (chairman) presiding. The CHAIRMAN. Gentlemen of the committee, when we concluded the hearings yesterday, Mr. Gilbert was on the stand as a witness, and owing to the call from the House there was a sudden interruption of the proceedings. Mr. Gilbert has remained over. I am pleased to state that the Philippine commission has also arrived. I want to assure them, though they are not now in the room, 58 PHILIPPINE LOCAL AUTONOMY that it is a great pleasure to have theml with us, and I have asked Representaitve Guevara to present the commission to the committee. Mr. GUEVARA. Mr. Chairman and gentlemen of the committee, I have the honor and pleasure of introducing to you President Manuel L. Quezon, of the Philippine Senate, chairman of the Philippine independence mission, and Senator Sergio Ozmeina. These gentlemen, together with Representative Claro M. Recto, minority leader in the Philippine House of Representatives, who will be here in a short while, have just arrived in Washington this morning to address the committee in relation to their deliberations regarding the Philippine question. I believe that the Committee on Insular Affairs will be glad to listen to their advice and opinion in regard to the Philippine question in order that we may reach a solution satisfactory to the Amercan people as well as to the Filipino people. I wish to introduce to you, gentlemen of the committee, Mr. Quezon and Mr. Osmefia. The CHAIRMAN. Gentlemen of the commission, permit me to say that the committee is delighted that you have arrived in time to take part in the deliberations that have to deal with the fixing of the status of the Philippine Islands as related to the Government of the United States. I can not forbear at this time to pay a just tribute to the work that has been done by your representaitves who preceded you here, the Resident Commissioner, Mr. Quevara, and Mr. Gabaldon, and the special commissioner, Mr. Roxas. These men have earnestly striven to follow out the instructions and honestly and very capably presented to the committee the thought, and, I think, exemplify the feeling of the Philippine people upon this very important problem. However, it is with great pleasure that we welcome you gentlemen here, just in time to take a very important part in the determination of what this committee is doing in the reporting out of a proper measure. Mr. QUTEZON. Mr. Chairman and gentlemen of the committee, it is very gratifying to us to learn of the splendid work done by our representaitves in Washington. We will be at the service of the committee if in any way we can be of any use. The CHAIRMAN. I want to say to the chairman of the committee that these gentlemen have just arrived in the city; about an hour ago. Of course, it is our desire to give them opportunity to make a full and fair statement, and to confer with us and other departments of the Government in connection with the solution of this problem. We already have witnesses who are to appear this morning, and I would suggest to the committee that when we do adjourn that we adjourn to meet Monday or Tuesday morning at whatever time may be suitable to the convenience of both the committee and the representatives from the Philippines, giving them a little opportunity to study the bill that we have under consideration, and to have some conferences vwith their own representatives here, and would that be suitable to your convenience if the committee should be ready to hear you on next Monday morning Mr. QUEZON. We will be ready. The CHAIRMAN. The committee will decide a little later as to whether it will be Monday or Tuesday morning. The chairman. of course, will not take the liberty to determine a matter of that kind. PHILIPPINE LOCA.L AUTONOMY 59 Now, Governor Gilbert is with us again this morning. He, was left up in the air yesterday at the very summary conclusion of the hearing. I did not know but what perhaps some members of the committee had further questions that they desired to ask, Mr. Gilbert. If you have any further questions this morning, I think Mr. Gilbert would be glad to answer them. Mr. KNUTSON. Had Mr. Gilbert concluded his remarks yesterday when we adjourned. Mr. GILBERT. Mr. Chairman, if you recall, I came here with no statement. I practically answered questions yesterday, and when that hurried call came for the adjournment I did not know whether I was through or not. I am ready to try to answer any questions. I have no particular statement that I desire to lay before the committee. The CHARMAN. Mr. Beedy was putting a series of questions to you when we were suddenly interrupted. Mr. GILBERT. The gentleman sitting next to you. Mr. KNUTSON. Yes; it was Mr. Beedy.. Mr, GILBERT. He was asking me some questions. I remember he asked me a question that I did not reply to. The bell rang and everybody jumped up. Mr. KNUTSON;. I wanted to ask the governor, in the course of his remarks yesterday-I, have not seen a transcript of them-but you rather gave the inference, Governor, that the Philippines were not ready for independence at the present time for several reasons; that they were not sufficiently advanced politically or economically; and that they would become more or less a prey-that is, there would be a danger of them bcoming a prey to other countries. You also called attention to the fact that the preparedness or ability to defend one's self involved other than military preparedness, which of course the committee fully agreed with you on. How do the resources of the Philippine Islands compare to the resources of Japan? Have you any information as to those natural resources? Mr. GILBERT. Well, before I answer that question, I would like to disavow your resume of what I said. It is not what I meant to say exactly. Your question purports to give the impression that I left on all these questions, and I do:not quite agree with those impressions. Of course, the resources of Japan are very much greater than the resources of the Philippine Islands. The resources of Japan are largely developed. The resources of the Philippine Islands, are largely dormant, or waiting development. I have no figures, but there is very little comparison between Japan and the Philippines in the matter either of developed resources or of undeveloped resources. I did not mean to leave the impression yesterday, and it seems you got such an impression, that the Filipinos were not in any particular qualified for independence at the present time. I think there are two dangers, two reasons, why they are not at present qualified. One is the danger of outside aggression,, which perhaps could, be cured by the suggestions made by Mr. Beedy, but the great difficulty to be encountered is an economic difficulty. Until you sit down and maks figures, you can hardly realize what a great benefit has come to the Philippine Islands by reason of having 60 PHILIPPINE LOCAL AUTONOMY the markets and the support of the United States. Take it in the matter of selling bonds, so recently sold; it would not be contended by anybody that they could have been sold at the prices they were and placed as readily as they were except for the fact that the buyers of the bonds believed that the United States was morally behind those bonds. The markets of the United States being open to their products, every other product in the Philippine Islands, except hemp, gains in price by reason of the opportunity of coming into our markets free, and that accounts, in my judgment, for the increased wages the laboring man gets in the Philippine Islands, as compared with the wages of the laborers on the China coast near by or the Dutch possessions below. That is the main point I tried to make in the desultory testimony I gave yesterday, that we ought not to deprive the Filipino of those advantages, as it is too early in the matter of their development for them to lose those advantages. Mr. KNUTSoN. Now, Governor. speaking of outside aggression, which you fear would follow in case the Filipinos were granted their independence, has Siam ever had any difficulty with other countries? Mr. GILBERT. Not that I know of. I am not very familiar with Siam's history. Mr. KNUTSON. Siam has no army or navy to speak of. Mr. GILBERT. I do not know much about Siam. Mr. KNUTSON. The fact that Holland owns Java would not deter Japan from going in and seizing that possession if she wanted to. Mr. GILBERT. Well, I think it would have some deterrent effect. Mr. KNUTSON. You would not contend for a minute that Holland could carry on a successful war with Japan, a small country of a few million, 12,000 miles away, with a negligible navy, and a negligible army. The mere fact that it was known among the nations of the world that Uncle Sam would look with disfavor upon any attempt on the part of a foreign power to seize the Philippines, or any portion of them, would act certainly as much of a deterrent as the Dutch Army and Navy, in so far as Java is concerned. Mr. GILBERT. Well, of course, when I speak of independence-I do not know what you mean by independence-what I mean by independence is absolute independence, and I take it if the Filipinos were independent of the United States that we would have no more business objecting to what took place there than England or Germany or any other country. Mr. KNUTSON. You are familiar with the Platt amendment setting Cuba free, are you not? Mr. GILBERT. Yes, sir. Mr. KNUTSON. Why could not we have some sort of arrangement like that with the Philippines? Mr. GILBERT. I would not favor it myself. I think we have lived to regret the Platt amendment, as respects Cuba. We have had to intervene there twice, and if you can judge anything by the newspapers, we are likely to do it again. Mr. KNUTSON. I happen to know something about the situation in Cuba. The present difficulty down there is all being engineered and fomented in New York. We have got two contending American forces down there that are fighting for the control of the economic PHILIPPINE LOCAL AUTONOMY 61. situation in Cuba, two groups. I could name them, but I think every member of the committee knows who they are. Is it not a fact, Governor, that the more money, the more American money invested in the Philippines before they are given their independence, the harder it is going to be for the Philippines to get their independence? Mr. GILBRET. It would not be hard for the Philippines to get their independence if this bill passes, because the bill provides at the end of 30 years they may have it if they desire it. The amount of money invested there would not cut any figure. Here is the proposal on the part of this bill, if it should pass, to make a definite covenant with the Philippine Islands, and when the time comes for the execution of that covenant, the American moneyinvested in the Philippines by Americans would make no difference unless you would assume that the United States is going to use a bridge term, unless you assume the United States is going to renig, and the United States, of course, will not do that. Mr. KNUTSON. Well, we have had a lot of treaties with the orig — nal aborigines in this country, some of which have not been lived up to. Mr. KENT. I do not like that. I know that the Quakers have lived up to every treaty. Mr. GILBERT. I do not know anything about that, Mr. Knutson. Mr. KNUTSON. It is a fact. The carrying out of treaties with Indians rests largely with Congress. I have a large Indian constituency, and three different treaties have in the past been entered into by the United States and the Indians, and not one has been fully lived up to. What reason have we to assume that we will be fairer to the Filipinos than we have been to the American Indians? Mr. GILBERT. Well, you are making a premise that I do not want to subscribe to, because it is not within my knowledge. I have assumed, and I prefer to assume it yet, that the United States will keep any agreement it makes, and the Filipinos will keep aany agreement they make, and if a bill of this character should be passed that it will settle that question, because of the character of the two peoples. Now, if I am wrong, if Congress is going to act dishonorably in the future-I do not assume that, and I do not believe it-I say it with:all defereice to:your, opinion, but- I do not believe we can figure the United States is going to be dishonorable and violate treaties or covenants and agreements. Somebody said yesterday, Will not the Filipinos continue to agitate for independence, even if this is done? No; because the Filipino will be as honorable as our Congress will be. Of course, if we are going to assume that obligations will not be kept by either party, why then this whole thing is futile, and there is no use, talking about it, but I refuse to assume that about mny Government. Mr. KENT. Is the question open; for discussion, Mr. Chairman? The CHAIRMAN. Certainly. Mr. KENT. I am much interested,in the testimony the gentleman gave yesterday and thisi moring.; Do you think; that it is the duty of Ameria, having taken over the Philippine Islands as the, result of our war with Spain, to bring -.. i E-, -;....... ar. 0:t ring 62 PHILIPPINE LOCAL AUTONOMY the Filipinos and their government to the present high standard of the Americans before we give them their independence? Mr. GILBERT. Oh, I should say not; the obligation does not extend that far. Mr. KENT. DO you think the Filipinos have arrived at the point where they are able to maintain the ordinary kind of stable government which now exists over in the Pacific in that territory, after their own fashion and in their own way working out their own destiny? Mr. GILBERT. DO yOU mean everywhere? Mr. KENT. Well, exclusive of Japan, but in and around there where the Philippines are. Mr. GILBERT. Practically all the countries over there are governed by some European nation, as far as I can recall, practically everything. This will be a novelty, so to speak. witf the possible exception of Siam. Mr. KENT. DO you think they are able now, if there is no aggression from without, say Japan, from Japan or Great Britain, or any of the other large powers, without outside aggression, that they are able to build up a stable public-school system, a stable banking system, a stable economic system, and a stable social system in their own way? Mr. GILBERT. I will have to answer that not " yes " or " no." The type of Filipino that you see in this room is as capable in all of these things as any of us. Unfortunately there are not a very great number of such Filipinos in comparison with the 11,000,000 people that are there. I have not any doubt of the ability of a certain number of Filipinos to establish and conduct a government, if there is no outside aggression. I do think that the mass of the Filipinos are not yet as qualified as the mass of people ought to be to conduct their own government, including their foreign affairs and all government business, and I believe that if they should be given their independence now, they would be so crippled by reason of lack of revenue and decreased prices which they would receive for their products. that it would be very unfair to them and set them back many years; if they were given this interval of time, say 30 years, things would be different. Mr. KENr. You realize there is a distinction. We do not owe them the duty of bringing them up to our standard of government and our standard of citizenship. Mr. GILBERT. That is true. Mr. KENT. That we are merely obligated before we set them out among the commonwealth of nations to establish there a stables government to see that they would be a stable government, and as to the question of a stable government, reasonable men may differ. Mr. GILBERT. The government is stable now. Of course, those words in the preamble of the Jones bills have been a matter of contention ever since they were written, and, for my part, I think it was a stable government when they were written. Mr. KENT. If they have no aggressions from without, something that we could guard against and guarantee them from, if we do give them independence, if they had a few years, say, two, three, four, five years, within Which to prepare their economic and banking system, don't you think they would then have a good stable govern PIILIPPINE LOOAKL AUTONOMY3 83 iment through which, with the aid of these educated young peole, they would be able to build up the educational, politicll, baking,.and social systems? Mr. GUIBERT. Well, I think the proposal in this bill to give them a considerable time in which they can conduct their local government from the governor general down will fit them. I think that gives them necessary schooling and that very experience which will be necessary for the successful administration of the government in the future. Mr. WILLIAMs. Speaking of aggressions from foreign countries, that question will arise at any time the independence of the Philippines is given, will it not? Mr. GILBERT. It may, yes; at any time. Mr. WILLIAMS. We are bound to assume it will, namely, in 20 or 30 years that question will arise, and deferred independence will not change that proposition. Mr. KENT. As far as we can go, Governor, if we do give them independence-as far as we can go is to protect them by a treaty with other nations involved in the Pacific. It is not to be expected that we are going forever to guarantee their territorial integrity. Mr. GILBERT. I do not so assume; no, sir. Mr. WmuLAM-S. My question was one that will arise ati any time if independence is given. Mr. RAGON. You do not mean to say they have got to 'have a' big army and navy before they cain have independence? Mr. MACLAFFERTY. Your opinion is if we guarantee them by 'treaty, in case of immediate independence, or whei!we give them independence, if we guarantee' them by treaty, guarantee their national integrity, are we not obligated, in case the other party to that treaty breaks the treaty, to defend the Philippines: Mr. GILBERT. I would not want to try to answer that'categbrically. I should think we would have some obligation in hiat event. I never considered that until it as suggestd yeste rday. 'I a:im not:much in favor of going out tothe World and ask 'iation after nation in reference to this obligation that we, have' in the Far East. Mr. MACLAPERTY: If we u ondertook treaties' with other' nations, guaranteeing them national integrity, the national integrity of the Philippine Islands, are we not in duty bound, if te wish' to uphold our honor, in case that treaty is' violated, to defend the terms of the treaty?... 1.. Mr. GILBERT. Yes, sir. Mr. MAOLAFFERTY. Does not that constitute a protectorate established over the Philippines in case they ate given their independence? Mr. GILBERT. It would be something in the nature of a protecto-rate. Mr. KNUTSON. You stated, Governor, yesterday and to-day, that the income of the islands was not sufficient 'to maintain the govemrnment. Mr. GILBERT. Not a government; I think I said the reduced income. What I mean to say, and what I believe I said, was that the reduced income that would necessarily follow if the markets of the 101692-24 5 64 PHILIPPINE LOCAL AUTONOMY United States were closed to them, if the Philippines were deprived of the markets of the United States, would not permit the conducting of a government of the kind they have now. It would mean the necessity of reducing the number of schools, reducing various other things; reductions would have to be made. Mr. KNUTSON. What are the recepits of the islands, receipts and expenditures? Mr. GILBERT. I do not know that I am very accurate about that, because they have been increased very greatly during and since I left the Philippines in 1916. In my day, when I was there 10 or 11 years ago, the receipts were a little under thirty million, as I recall it. Mr. KNUTSON. Dollars or pesos? Mr. GILBERT. Pesos. The last time, Mr. Roxas says now they are, about 66,000,000 pesos, $33,000,000. Mr. KNUTSON. And the expenditures are how much? Mr. GILBERT. Some years they have been more than that: some years they have more than the receipts. I think they vary. The government there is conducted as it is here. There is never much of a surplus that I have heard anything about. Mr. KNUTSON. No government has a surplus. The CHAIRMAN. Are there any more questions you desire to ask the governor? Mr. SCHAFER. Just one question relative to that. I understand you to say that if the Philippine Ilands were granted their independence, they would suffer on account of trade relations, which practically infers that they would have this export and import duty, if they were independent, which they do not have now. I wonder if they will suffer so much. I know that in the annual report of the insular collector of customs, secretary of finance, for the fiscal year ending December 31, 1922, on page 50, in a table showing trade with the United States compared with all other countries, there is a total of 223,699,852 pesos in the year 1922, the total trade with the United States. At the same time this table shows there is 127,852,033 pesos as the total trade with all other countries. Now, would it appear that in 1922, when they did not have the, export and import tariffs, they were able to trade with other nations, which nations I presume had tariff rates applicable to that extent of over half the amount of trade that they had with the United States. Mr. GILBERT. What is your question; or is that a statement? Mr. SCHAFER. I was wondering whether your statement was not far-fetched as to the point if they were granted independence they would suffer economically on account of perhaps the tariffs which they will have to pay, which they are not paying while under the' United States? Mr. GILBERT. The sugar of the Philippine Islands, which is a growing product, increasing year by year, ought to supply all the sugar we need in the United States. They have a wonderful future in that industry. That sugar comes into the United States free of duty. 'The sugar from every other country comes in with a duty. The sugar from Java-and there is a lot of sugar produced in the Dutch islands-has that handicap. What the duty is I do not recall. You gentlemen are familiar with it. I think the fact that they can bring in several hundred thousand tons of sugar without duty and PHILIPPINE LOCAL AUTONOMY 65 beat the rest of the world is a tremendous advantage to the.Phiiippine Islands. I happen to know that in the islands where they produce the most of the sugar there is a fear that they will, be compelled any day to pay duty. Of course, it will then put them on; exactly the same basis as Java. Mr. MILLIGAN. Is there not a different duty on sugar coming in from Cuba than other countries? Mr. GILBERT. There is some kind of a differential, I believe. Mr. KNUTSON. About a half a cent a pound difference, I think. Mr. SALMON. The sugar coming from the Philippine Islands to the United States duty free really comes in at the expense of the United States Government. The United States Government loses the duty that would be made on the sugar from the Philippine Islands if it came from some other country. Mr. GILBERT. Yes, sir. Mr. SALMON. What would that amount to? Mr. GILBERT. Well, I can not answer that. It would be a considerable amount. Mr. SALMON. In other words, that is a loss to the United States Government. Mr. GILBERT. Yes, sir. My entire argument, if I have made an argument, is imade on the theory that we owe a duty to the Philippine peoples and my interest in the Philippine people is what I am talking about. I think the United States Government is big enough and strong enough so if we do lose a few dollars it does not matter, but it matters to the Philippine people when they lose money, and I am talking because of my interest in the Philippine people. Mr. MILLIGAN. You do not contend if the Filipinos were given their independence that a duty would be placed on their sugar coming into the United States and that there would be no sugar shipped in from the Philippines? Mr. GILBERT. No; I do not contend that no sugar will be shipped in. Mr. MILLIGAN. There is a possibility of the next Congress changing the tariff duties to a great extent, is there not Mr. GILBERT. Yes; but I suppose if they were an independent nation that we must treat them as we treat any other independent nation. Mr. KNUTSON. Do you not think that the Philippine sugar producers could compete with Cuba? In the Philippines, I understandc they pay about 75 cents a day, and in Cuba they pay $1.75 to $2.50 for field labor. Mr. GILBERT. Well, of course, a great many elements enter into that, because transportation is very umuch higher from the Philippines to New York than Habana to New York. Mr. KNUTSON. Water transportation involving a few thousand miles does not make a great difference. Mr. GILBERT. It makes some difference. Mr. KNUTSON. But not enough to offset the difference in the cost of labor. Mr. GILBERT. The cost of labor in the Philippines has increased year by year ever since American occupation. Mr. KNUTSON. It is 75 cents now, is it not? Mr. GILBERT. It differs in different parts of the island. When I was out there it was 75 cents gold. 66 PHILIPPINE LOCAL AUTONOMY Mr. KNUTSON. That is the maximum? Mr. GiBERT. Yes, sir. Mr. KNUTSON-. In Cuba they pay $1.75 and $2.25. Haitian labor is what they employ, which is not as efficient as Philippine labor. Mr. GILBERT. I do not know about that. Mr. KNUTSON. Well, fortunately I happen to know, so what I am trying to bring out is that any difference in water rates between Cuba and New York and Manila and New York would be more than offset in the difference in the cost of production. Mr. GILBERT. You may be right about that, but it still would follow that if a ton of sugar comes from the Philippine Islands duty free, and if it comes to-morrow and had to pay a duty, the Filipinos are hurt just to that extent. Mr. KNUTSON. I want to ask another question, if I may. According to your argument. we will lose a lot of money by reason of our retention of the Philippines in tariff duties. Now, shouldn't charity begin at home? Why should we continue to carry the burden of the Filipino people which they have offered to relieve us of? Mr. GILBERT. That is a question of morals, partly. Mr. KNUTrsox. But why should we continue to play Santa Claus to the entire world? That is something I can not get through my mind. We go into Honduras, Nicaragua, Santo Domingo, and when we get there we put up the flag and we stay. We are getting out of Santo Domingo, in a way. We are going to retain control of the finance. We are taking the marines out. The only reason we got out was, they were Spanish-speaking people, and the other Latin-American countries were boycotting our commerce by reason of our staying in there. Mr. GILBERT. I am not trying to argue that we must play Santa Clause to the entire world. In fact when I was about 11 or 12 years old, I found out there was not any. Mr. KNUITSON. I never knew there was one. Mr. GILBERT. But I do not argue that it is profitable for us to be in the Philippine Islands. It has been a burden to us, but I do not think it is the kind of a burden that any red-blooded American objects to. We ought to be proud to do it-give the people that never had an opportunity in anything until we came there, give them a chance in the world so they may become a nation. I think that is a fine piece of work to do, but I do not contend it makes us any money. Mr. KN-UTSON. You said yesterday we had not profited any by retaining the Philippines. Mr. GILBERT. Financially. Mr. KXUTSON. Theodore Roosevelt said that the Philippines constitute a military menace to this country, and I presume he knew. He was about as good a President as we have had in a long time. Why should we continue this paternalistic policy, which may. perhaps might, involve us in a war in the future? It can bring us nothing, possibly, but ill will. Why should we continue to tax the American people, to play protector to every country in the world: that is, every country on this continent and the Philippine Islands? PHILIPPINE LOCAL AUTONOMY Mr. GILBERT,'I aminot in favor:of it... I would pot:think of doing it indefinitely.I would very definitely fix the time when we would say our job is d9ne;., *::: Mr. KNUTSON. I think you will agree with me that the. Philippines cost us, millionsof dollars.:How many soldiers did we havve out there during, the insurrection? I:.;! I Mr. GILBER. I do not know; a good many. ';.:,Mr,: KNT soN., Sixty or seventy, thousand, -.. Mr. IGuLaRT., Probably,,. '.-., '. Mr. KNUTsoN. Now,;we. maintiin.: troops.aed:s Ieouts. outi there. We haye to transport food Ito; h0mn almunitions and eyerythmng else necessa:y They have been ai source of expense. and I dare say,the: Philippinies haavecost us a billion or a billion and a half dllars. I have tried, to gaet figures without success, but, I am sftis fed the a.mounit runs up into the hundedsa 'ofA millions. The.relationship is irksompe to us, unprofitable to us. and why continue such a relatimnship except from. a purely altrutistic standpoint. Mr, Gou ir. My.position: satisfies my miad.: Of course I think possibly this is true, if you had lived among. these;people and knew, *t em and learned to care? for theme you might feel ea little differently about habandoning them before. it was time,: but perhaps you knew them. as you knew Nicaragua or' Hjaiti. I look at it in a lttle different way, because I have seen something of their problems. I have seen something of what they: are trying to do, something of their ambitionsg I have seen these young men, who, until we went out there, did not have an opportunity, i. the world. I have seen them given an opportunity, like Mr. Ro6xas, whp has come to Washington and made himself felt ini this community of nations. 'We gave that opportunity, to him. I do not 'want to take it away from them until it is so, firmly established that they will keep it. 'iMr. SfArEn. I want to read from the same report for the fiscal year ending December 31, 1922. On page 209 it gives the total amount of sugar exported to the; United States for the year 1922, 244,851,617 kilos. It gives the, total export of sugar from the Philippine Islands during that year, to the United States, Guam, Germany, Spain, British Hong Kong, Japan, a total of 462.071,661 kilos, which would show roughly. that notwithstanding the fact that they have nmo duties to pay on the sugar exported to the United States, not all of their sugar goes to the markets in the United States,f and if a high tariff were put on, they could find other markets.,1 would assume that about one-third of their export sugar gQes to other countries than the United States. You made a statement in substance that if the Philippine Islands were granted independence, and a tariff was placed on the sugar, which is now on the free list, that it would injure the Philippine people. Do you not think that if they can export approximately one-third of their sugar now, when we have no duty here, they can find a place to export all of it to some other country, if we put a high tariff on sugar should independence be granted? Mr. SwrzrtEl. May I answer that question? It is perhaps not well known that no doubt-I have no figures-but I know enough of the sugar business of the Philippines, to know. that in all probability 90 per cent of that sugar which went to countries other than the United States was a low-grade sugar, a very low graded sugar, about 86~,. whereas the sugar that comes to the United States, 68 PHILIPPINE LOCAL AUTONOMY and comes from Cuba is 96~ centrigrade sugar. Now, that lowgrade sugar finds a better market in China and Japan than it does here in the United States. The refineries in the United States do not like to receive that kind of sugar. They will take the other sugar in preference. Japan, for example, has a preferential tariff on this 96~ sugar, the same kind that comes here, and comes from Cuba, but as I recall it, the duty on this lower rate sugar is very low. That accounts for that sugar, some portion of the Philippine sugar, going to countries other than the United States, even though there is that free entry into the United States. While I am on that subject, may I also answer a question that the gentleman at the end of the table brought up with reference to sugar, the miore or less comparative cost of sugar in Cuba and the Philippine Islands? I am not surprised that many do not know whv it would be so difficult for Philippine sugar to compete with Cuban sugar. It is not only a question of increased freight rates, which the governor has quite correctly mentioned, but the most important factor there is that in Cuba the rattoon stands for 14 years, and in the Philippines the rattoon is almost unknown. Mr. MACLAFFERTY. What is the meaning of the word "rattoon Mr. SWITZER. By rattooning the plant, say for example, this yearthey plow the soil and plant the cane. The next year they will cut the cane off and let it grow up again, without plowing that soil and replanting, they will go ahead and cultivate it without planting again, but in the Philippines, on account of soil or climate, or both, very little of that rattooning can be done. If it is done at all it is not for more than 1 or 2 years. Mr. KNUTSON. Before it has to be replanted? Mr. SWITZER. Yes, sir. You gentlemen know something about the farming industry in our own country; know that the initial plowing and preparing of the soil is a very important part of the cost of raising the crop. Mr. MACLAFFERTY. And furnishing the seed also. Mr. SWITZER. Yes, sir; furnishing the seed. Mrl. MACLAFFERTY. That same condition applies in Hawaii, does it not Mr. SWITZER. In Hawaii they rattoon for many years, but it is due to the soil. Cuba is favored with a soil for rattooning. Mr. MACLAFFERTY. Only three years in Hawaii, I think. Mr. SWITZER. Something like that. I think it does run as much as 6 or 7 years. I believe the gentleman who asked a question a moment ago will see that makes a tremendous difference in the production of the cost of sugar. Mr. KNUTSO'N. I can see where that would have such effect. The CHAIRMAN. Have you any further questions to ask? Mr. SCHAFER. If the Philippine Islands were granted independence and the tariffs are put on sugar, is it not a debatable question whether the Filipino people will suffer the most, or whether the middlemen, between the sugar plantations and factories in the Philippine Islands and the consumers in the United States? Mr. GILBERT. Well, that might be debatable. That is all passed down to the fellow who does the work, like taxes passed on to the consumer. PHILIPPINE LOO0L AUTONOMY Mr. IKirUsQN. The farmers and consumers bear the burden. i Mr. SCHAFE-R Don't you think the American farmer would like i tariff,nisugar, and especially the American sugar-beet farmer? Mr. 'SwIrzE Yes, sir; and some of them are advocating independence for this very reason. Mr. MACLAFFERTY. Don't you think the sugar growers of Louisiana would like a duty on sugar? Mr. GILBERT. Yes, sir; if you. will look into the advocates of in'dependence among our people; a lot of them are so situated that they have this very selfish reason in mind. Mr. MILLIGAN. Do you know the per cent of sugar consumed in the United States;; what percentage is produced by the American sugar growers? Mr. GILBERT. NO.. Mr. MILLIGAN. Three per cent, is it not?: Mr. GrLBErr. It is a small- per cent. i -Mr. KN-rTON. Does that 3 per cent include Hawaii? Mr. MILLIGAN. No.. Mr. KTr TSON. Hawaii is an American sugar. Mr. MILLIGAN. I was speaiing of continental United States. Mr. GLBERT.- My recollectin is that before the war America; got half of her sugar from Germany and other countries over there; Gentlemen, we ought to be producing it all, in my opinion, in the Philippine Islands. We have practically exhausted the sugar territory in Hawaii. Mr. MACLAFFERTY. We have exhausted the sugar territory in Hawaii? Mr. GILBERT. There is very little of unused sugar territory in Hawaii. We have in the Philippine Islands a great deal of land that is suitable to cultivate sugar. Mr. KENT. Governor, do you take it we should base this question, -whether or not we should report this bill out, upon the question of America's future need of sugar? Mr. GILBERT. No. Mr. KENT. Or whether American capital wants to go in there and build railroads and plantations, whether there is oil in the soil there, gold, coal, or silver, -or -whether the Filipinos are now able -to go ahead in their own way and work out their own destiny. Mr. GILBERT. I tried to make myself very plain that I think the primary consideration is what is best for the Philippine people. Mr. KENT. Do you think that is a test, Governor, before this committee as to what is best for them? If they want independence and they are capable of having independence, whether it is; a good thing for them or whether it is not, as the economy of the world is now constructed it does not make any difference, does it? Mr. GILBERT. It does to me. I think we ought to do the right -thing as far as we know how to do it, having in mind, of course, the ultimate best results primarily for the Philippine people. Mr. KENT. Now, if you will pardon me, there are a lot of people who believe that when the tie is cut and you make the Philippines a foreign power immediately, putting them subject to our tariff duties and immigration bands, and things of that kind, a possible exclusion of the Philippines from the right to come into this country, based on the theory of the Pacific coast to-day, that Japan and 70 PHILIPPINE LOCAL AJITOXOMY Great Britain will. immediately becmae t-he dominating factor in the Philippine Islands. and subjtigate them in a few years, not absolutely, perhaps,, but tleoretically they will have control of the industries in the Philippine Islands. That is not the question before this committee, is it. Governor? The question is, if they have established a stable government they can work out their own destiny, in their own way. as they see fit: after they have done that then our duty has ceased in the Philippines. and if they want to get away from us we should not hold them like England tried to hold the American colonies. Is that not the thought we ought to have in mind? Mr. GILBERT. I would not say that. It is not the way I view the, question. Not exactly. as you will readily see. Remember, there are a great many Philippine people that are not saying anything' about independence. Mr. KENT. The thing I am concerned about is, whether or not in 25 or 30 years, well educated and highly cultured people from the Philippine Islands will come here demanding absolute. independence. Now, if they are capable I do not think we ought. to hold those people under the dominion of America. Mr. KNUTsoN. I take the sname position absolutely, and a resolution granting Philippine independence in 1920 came within-how many votes of passing the Senate and the House? Mr. ROXAS. Twenty-one votes in the House. Mr. RAGON. This witness has had to answer the same question about ten times. Can we not go on with the hearing? The CHAIRMAN. If anybody else has another question to propound to the governor, new in character. Governor Gilbert will be glad to answer it. Mr. RAGON. I want to say that the governor made his statement on this very plain yesterday, and his ideas upon it, and we are rehearsing it, it looks to' me. We are rehearsing what we went over' yesterday. The CHAIRMAN. We' have with us this morning Mr. Quist, of' New York, whom we will be glad to hear at this time. STATEMENT OF MR. A. J. QUIST, REPRESENTING HALLGARTEN & CO., NEW YORK Mr. QUIST. Mr. Chairman and ogentlemen of the committee, and gentlemen of the commission, for the record I will state that my name is A. J. Quist, and I represent Hallgarten & Co.. 44 Pine Street. New York. For the past eight years I have been identified with the purchase and sale of state. city. and municipal bonds. All insular possession financing is within my realm. By tile way, I may explain that Hallgarten & Co. is one of the large banking firms in New York, founded in 1840, and has been a house of issue, identified with the purchase and sale of securities. We with Blair & Co. (Inc.) and Chase National Bank, both of New York City, and other houses, have had a Philippine group, and I think we have handled the majority of the Philippine financing since 1920. We have. sold to the investing public about $30,000,000 of these bonds, which we purchased from the War Department. In PIHILIPPINE LOCAL AUTONOMY 71 addition to such purchases and sales we have probably.traded in $10,000,000 bonds in the open market, making our total dealings in Philippine bonds more than $40,000f000. We have handled all the Philippine issues with the exception of two loans since the enact+ ment of the Jones bill. Wee have read in the papers and learned through a communication with the War Department that some independence measure was being considered. We have in the banking fraternity what: is known as the Investment Banker's Association of America, and one of its functions is always to cooperate with legis0 lative bodies: in an effort to protect the holders of bonds when it feels there is a possibility of impairing the secutity. As an organization, we are officially seeking protection for all the bondholders of these securities, which largely have been sold to insurance companies, as collateral against insurance policies;,to savings banks, to isure savings bank depositors and investors large and small in every State in the Union, One' class has bought large blocks of these. securities because they are tax exempt, and small investments of one or two bonds have been made in them, the smallest investor having probably invested 25 or 50 per cent of his life's savings. Now, in reading over this, bill, and in hearing the statements of Senator King and Senator Robinson, they express themselves as not believing, or at least they stated they did not feel that this Government was in any way obligated to protect the holder of these bonds. I think the statement was made that our Government is not under any legal obligation, and all the people who purchased these bonds purchased them, knowing the -Philippine government. would eventually have independence, and as such they purchased them at their own risk. Now, prior to going into this financing we investigated very carefully the status of the Philippine Islands, and their bonds and the light in which they would be held. We considered them a moral obligation of the United States. They are not a legal obligation, because of the fact that the bonds do not bear the indorsement or specific guaranty and pledge of this Government to ultimately meet the payment of principal and interest.. Our reasoning was along three lines-first, by the very relation of our Government to the Philippine Islands; second, by statements of Federal officials of the Government; and. third, by the construction which the Federal courts have placed upon the Philippine Islands. Now, I will go into each one of those questions very briefly. I think by first reading the Jones bill you recall in the very preamble of the bill it states that our relation with the Philippine government is: that of sovereignty. All Philippine legislation with particular respect to the bonds has been by an act of Congress, a specific act of Congress in 1905, or else by a general act of Congress, such as was passed in 1920. The Congress of this country regulated the debtincurring power of the islands..We have placed a debt limitation. We have decided the purposes for which they can issue bonds; which have been for public improvement, for highways, sanitation, schools, etc. Congress has also limited the finances of the islands by and with the consent of the President of the United States. 72 PHILIPPINE LOCAL AUTONOMY Now, then, with all these bonds being issued really by an act of Congress, although the Philippine Islands is the creditor nation, the people who have purchased these bonds in good faith, purchased them because they were issued by an act of Congress. It is similar to the Federal farm loan and the joint-stock land banks. They are an instrumentality of the Government. The court, in speaking of all of our insular affairs, used that very term; that the Philippine Islands are an instrumentality of this Government. Now, at this point I want to state that we have no selfish motive in this. We do not own any of these bonds. We have probably 50 of these bonds now. which we acquired in trading in the bonds. The only thing we want to urge upon this committee is that you take proper precautions in framing any bill that you pass to see that the bondholders are protected. Now, with respect to the statements of Federal officials, I think the first statement was by Solicitor General Hoyt in 1903. I will read that statement, if I may. Mr. RAGON. Have you studied the Fairfield bill? Mr. QUIST. Yes, sir; I understand it. Mr. RAGON. Is there a provision there that takes care of you? Mr. QuIST. I am leading up to that. We want a more specific recital made of the sinking-fund provision. Mr. RAGON. What section is that in in the Fairfield bill? Mr. QUIST. I think it is under section 9. In the preamble in the bill of rights, in section G, it states the public debt of the Commonwealth shall not exceed the limits now or hereafter fixed by the Congress of the United States, and no loan shall be contracted in foreign countries without approval by the President of the United States. That is section G, section 4. Also in section 9, line 15, it states that the United StatesThe United States commissioner, pending the receipt of a decision by the President in the premises, shall have authority to suspend the taking effect of or the operation of any law, contract, or Executive order of the Commonwealth which in his opinion seems likely to result in a failure of the government of the Commonwealth to fulfill its contract or to meet its indebtedness and interest thereon or to provide for its sinking fundAnd so forth. Of course the only thing which we are requesting is that a little more detailed specific recital be incorporated in the bill concerning the sinking-fund provision. Now I will read the opinion of the Attorney General. This was Solicitor General Hoyt, concurred in by Attorney General Knox, who, I think you will agree, had one of our greatest legal minds. The pledge of the faith and credit of the Philippine government, covering the due application of the proceeds of the loan and the maintenance of the sinking fund, rests, then, upon authority explicitly conferred by the national power; and while in the strict and legal sense the faith of the United States is not pledged as a guaranty for the payment of the loan or for the due use of the proceeds or the observance of the sinking-fund requirements, the entire transaction is to be negotiated under the auspices of the United States and by its recognition and aid. The assumption is therefore conclusive and necessary that the terms of the statute as to the application of the moneys realized from the sale of the bonds and as to all moneys realized from disposition of the lands and as to the sinking fund so created will be strictly followed. PHIIUPPIIE LOCAL AUTONOMY 78 And in rendering an opinion, dated August 11, 1921, as to the legality of bonds issued under authority of the act of Congress the Attorney General made the following statement: I may add the following general observations, in conformity with the views expressed by Solicitor General Hoyt and concurred in by Attorney General Knox in their opinion to you of December 26, 1903 (25 Ops. 89, 93): "This issue and sale of bonds is authorized explicitly by the national power; and while in the strict and legal sense the faith of the United States of America is not pledged as a guaranty for the payment of the loan or for the due use of the proceeds or the observance of the sinking-fund requirements, the entire transaction is to be negotiated under the auspices of the United States of America and by its recognition and aid. There can be no doubt, therefore, that the national power will take the necessary steps in all contingencies to protect the purchasers in good faith of these securities." You have the same obligation, gentlemen, I think in properly safeguarding in any bill the same obligation that you have to the security holders of Mexico, which I think the Government recognized upon that condition in connection with its foreign obligations. There has been a similar case in the Dominican and Haitian Republics, also in Cuba. In the last two years the Haitian and Dominican Republics and Cuba were able to finance, at much more favorable rates of interest, than leading foreign countries, chiefly because of the fact that this GGovernment retains the right to seize the customs and control the revenues and apply them to the principal and interest of the sinking fund of the bonds, and it is the duty of Congress, I think, to protect American property holders, especially those who have purchased these bonds in good faith. These bonds have been sold at an average rate of 4j per cent and since the war slightly under that at a slight discount. That is about one-quarter of 1 per cent difference in the rate of interest than was offered by the United States Government for investment in Liberty 41 per cent bonds. You know that the credit of the Philippine Islands does not warrant any such high price for securities as compared with other foreign nations, such as the Japanese Government, which were sold to the public at 7.10 per cent. One of the finest credits in the world to-day is the Netherlands, which sold at 6.10 per cent to the public. All high-grade securities, English and Canadian, sold at a greater rate of interest than those of the Philippine government. These Philippine bonds sold at the high prices because the public believed that these bonds had back of them the moral obligation of the United States and were tax exempt. So much for the statement of public officials. By an act of Congress in 1905 these bonds were held to be tax exempt. The act of 1906 states that all bonds issued by the government of the Philippine Islands or by its authority shall be exempt from taxes by the Government of the United States, or by the government of the Philippine Islands, or of any political or municipal subdivision thereof, or by any State or by any county, municipality, or other subdivisions of any State or Territory of the United States, or the District of Columbia. The very language of Congress has created these bonds to be an instrumentality of the Federal Government, and the courts have held them to be such. The dual sovereign power of taxation is controlled PHIILIPPINE LOCAL AUTONOMY and vested in the Federal Government and also in the States. As youi know, the State of New York can tax the State obligations of the State of New Jersey; that is, the bonds issued by one State cal be taxed by another State. The Federal Government can not tax the obligations of the States, likewise the States can not tax the obligations of the Federal Government. That was the first opinion handed down by John Marshall, and I think I have a recitation of about.50 or 100 more cases where this has been upheld. It is one of our fundamental principles of government. In holding these bonds to be exempt from all taxation, even from Federal or State taxation, there is only one construction that can be put on it, and that is that these bonds are really an instrumentality of the Federal Government. That was the language of the court in speaking of the farm-loan bonds and other insular and Territorial bonds. Hawaii does not possess the full powers of sovereignty. It is a territory, an integral part of the United States. The people of Porto Rico and the Philippine Islands are instrumentalities of the Government, but they do not possess full sovereign powers. It is because of this very fact-the nature of their government-that the Federal Government can state, and the courts concur in it, that these bonds are an instrumentality of the Federal Government, and as such the Federal Government can exempt them from State taxation. Now. if they were not an instrumentality of the Government the courts would hold that they were subject to the taxation of the various States, which the Supreme Court of the United States has held they are not. It is an analogous case with the Federal farm loan bonds. They are instrumentalities of the Federal Government. Those bonds can not be taxed by any State or by the Federal Government, simply because of the fact that the farm loan bonds are an instrumentality for the convenience of government. They are us totally tax exempt as Liberty 3~ per cent bonds. Now, I think I have just briefly stated what the court holds in connection with these bonds and also the statement of public officials as well as the relation of the Philippine government to the TUnited States Congress. Mr. RAGON. Let me ask you a question. Mr. QUIST. Yes, sir. Mr. RAGON. In the case of independence of the Philippines-iimediate independence-there will be no more tax-free bonds from that country; that would not affect the bonds issued? Mr. QUIT. No, sir: it would affect the bonds-the credit —if Congress did not make a provision to take care of the bonds. They would probably drop in price. M-r. RAGON. Now, if this granting of independence would prevent the issuance of any more free tax bonds or the buying of tax-free bonds in the United States, what influence would that have on the value of the bonds already issued that are tax free with reference to the value? Mr. Q.IST. If Congress would pass, say, a recital in the bill whereby it was mandatory upon the part of the Philippine Islands to create sinking funds to take care of outstanding bonds, and in the event they would not have had some definite pledge of some security or a pledge of a certain amount, the first lien on the customs and revenues, it would have a slight effect, because our responsibility PHILIPPINE LOCAL AUITONOMY 75 is there no more and there would be a danger of other powers going in, and these bonds mature in 1952. It is a long time. Mr. RAGON. What per cent of them, if you know, mature at that time? Mr. QmsT. The largest per cent-about $40000,000. There are a very few of them that mature from 1942 to 1946. The bulk of them mature from 1950 to 1952. Mr. RAGON. What is the nearest time of any of them?. Mr. QUIST. I think it is 1934. There is a small lot due serially from 1926 to 1946, and then there are some from 1935, 1936, 1939, 1949, and up to 1950. Those were the friar land bonds and the loans which were issued prior to 1919. Since that time the bulk of the financing has been on the strength of the statement of the Attorney General; and by the construction placed upon the islands by the Supreme Court, in giving a correct interpretation of their tax exemption, in Pollock v. Farmers Loan and the revenue act of 1918. Mr. RAGON. You think a majority of the outstanding bonds would retire in 30 years? Mr. QTEsT. In 28 years. The average life of the bonds outstanding is 27 or 28 years. If I may continue before you ask any more questions, I would like to get my connected statement over. I would like to introduce into the record the descriptive circular on which we have sold these bonds, which the public has read and after reading has purchased these bonds. You will note in the circulars we present these bonds as an instrumentality of the Federal Government. We do not recite the specific mortgages securing, for instance, the farm bonds, or state where the farms are located. I n addition, we have not quite fully prepared ourselves in respect to this bill, and we would like respectfully to request before this bill is finally introduced (we should have this information in a few days and we will send it to the committee) that a specific recital be made concerning the: sinking funds. In the event of independence there should be cooperation with the bankers, and there should be a very strong sinking-fund provision made in this bill. Most of these bonds have sinking-fund provisions in them, or else they are collaterally secured bonds;, but if we do not have a strong provision in this bill it will be harmful to the interests of the bondholders. There is a brief statement made in the bill whereby it is mandatory on the part of the Philippine Islands to provide a sinking fund. We want that a little more definite; and we would like to have the sinking fund held and administered, preferably, by the Secretary of the Treasurer. Mr. RAGON. This couples up with the provision in the bonds? Mr. QUIST. This will create a better impression on the part of the holders of the bonds, and as you know the holder of the bonds, the man who starts investing in them, looks to the Government as the highest security which he can have. He has had that training from abroad, from his ancestors. If you can state in your law that this sinking fund is controlled and administered by the Treasurer of the United States, I think it is very strong, and it gives assurance to these people who really do not possess the real knowledge. 76 PHILIPPINE LOCAL AUTONOMY Now, if it is in order I would like to introduce these circulars into the record, and you gentlemen can read them. They cover all the loans we have been identified with. We would like to insert in the record in a few days our specific request for a sinking-fund provision, which I am sure will be agreeable to you gentlemen. The CHIAIRMAN. Have you any other records? Mr. QUIST. Yes, sir. The CHAIRMAN. How soon could you get them before us? Mr. QUIST. By Tuesday or Wednesday. The CHAIRMAN. With the permission of the committee, we will give him the privilege of inserting the additional statement. (The circulars referred to are as follows:) Exempt from Federal income tax and from State and municipal taxes-$10,000,000 Philippine Government 5~ per cent public improvement bonds-Bonds are not redeemable before miaturity-Dated August 1, 1921; due August 1. 1941-Interest payable February 1 and August 1-Principal and interest payble in gold coin at the Treasury of the United States-Coupon bonds in delnomination of $1.000-Receivable at par, under regulations of the Treasury Department. as security for deposits of public moneys. The Attoriney General of the United States, in his opinion as to the legality of tnis bond issue, states that" This issue and sale of bonds is authorized explicitly by the national power, and wbile in the strict and legal sense the faith of the United States of America is not pledged as a guaranty for the payment of the loan or for the due use of tlie proceeds or the observance of the sinking-fund requirements, the entire transaction is to be negotiated under the auspices of the United States and by its recognition and aid. There can be no doubt, therefore, that the national power will take the necessary steps in all contingencies to protect the purchasers in good faith of these securities." These bonds are issued under authority contained in the act of Congress approved August 29, 1916, as amended July 21, 1921, and in an act of the Philippine Legislature approved February 5, 1921. Under the terms of the act of Congress approved February 6, 1905, " all bonds issued by the government of the Philippine Islands, or by its authority, shall be exempt from taxation by the Government of the United States or by the government of the Philippine Iglands or of any political or municipal subdivision thereof, or by any State, or by any county, municipality, or other municipal subdivision of any State or Territory of the United States, or by the District of Columbia." Paymeit oil August 15 against bonds or interim certificates deliverable "when. as. and if issued and received." Price, 984 and interest, yielding 51 per cent. HALLGARTEN & Co. Exempt from Federal income tax and from State and municipal taxes$5,000,000 Philippine government 30-year 5 per cent bonds-Bonds are not redeemable before maturity-Dated February 1, 1922, due February 1, 1952 -Interest payable February 1 and August 1-Principal and interest payable in gold coin at the Treasury of the United States-Coupon bonds in denomination of $1.000-Receivable at par under regulations of the Treasury Department as security for deposits of public moneys These bonds are issued under authority contained in the act of Congress approved August 29, 1916. as amended July 21, 1921, and in an act of the Philippine Legislature approved January 31, 1922. The legality of the issue has been passed upon by the Attorney General of the United States of America. In rendering an opinion, dated August 11, 1921, as to the legality of bonds issued under authority of the act of Congress mentioned above. the Attorney General made the following statement: PHILIPPINE LOCAL AUTONOMY "This issue and sale of bonds is authorized explicitly by the national power; and while in the strict and legal sense the faith of the United States of America is not pledged as a guaranty for the payment of the loan, or for the due use of the proceeds, or the observance of the sinking-fund requirements, the entire transaction is to be negotiated under the auspices of the United States of America and by its recognition and aid. There can be no doubt, therefore, that the national power will take the necessary steps in all contingencies to protect the purchasers in good faith of these securities." Under the terms of the act of Congress approved February 6, 1905, "all bonds issued by the government of the Philippine Islands, or by its authority, shall be exempt from taxation by the Government of the United States, or by the government of the Philippine Islands, or of any political or municipal subdivision thereof, or by any State, or by any county, municipality, or other municipal subdivision of any State or Territory of the United States, or by the District of Columbia." Price, 103t and interest, yielding about 4.78 per cent. Payment on or about March 14, 1922, against bonds or interim certificates deliverable "when as and if issued and received." HALLGARTEN & CO. Exempt from Federal income tax and from State and municipal taxes-$2,000,000 Philippine government irrigation and permanent public works 4~ per cent bonds-Bonds are not redeemable before maturity-Dated July 1, 1922, due July 1, 1952-Interest payable January 1 and July 1 —Principal and interest payable in gold coin at the Treasury of the United States-Coupon bonds in the denomination of $1,000-Receivable at par under regulations of the Treasury Department as security for deposits of public moneys These bonds are issued under authority contained in the act of Congress approved August 29, 1916, as amended July 21, 1921, and May 31, 1922, and in an act of the Philippine Legislature approved March 8, 1922. The legality of the issue has been passed upon by the Attorney General of the United States of America. In rendering an opinion, dated August 11, 1921, as to the legality of bonds issued under authority of the act of Congress mentioned above, the Attorney General made the following statement: ' This issue and sale of bonds is authorized explicitly by the national power, and while in the strict and legal sense the faith of the United States of America is not pledged as a guaranty for the payment of the loan, or for the due use of the proceeds or the observance of the sinking-fund requirements, the entire transaction is to be negotiated under the auspices of the United States of America, and by its recognition and aid. There can be no doubt, therefore, that the national power will take the necessary steps in all contingencies to protect the purchasers in good faith of these securities." Under the terms of the act of Congress, approved February 6, 1905, " all bonds issued by the government of the Philippine Islands, or by its authority, shall be exempt from taxation by the Government of the United States or by the government of the Philippine Islands or of any political or municipal subdivision thereof, or by any State or by any county, municipality, or other municipal subdivision of any State or Territory of the United States, or by the District of Columbia." Price 97 and interest, to yield approximately 4.70 per cent. Payment on or about August 7, 1923, against bonds deliverable, "when. as and if issued, and received." HALLGARTEN & CO. WHITE, WELD & CO. BLAIR & Co. (INC.). Exempt from Federal income tax and from State and municipal taxes$13,000,000 Philippine Government 30-year 4i per cent gold bonds-Bonds are not redeemable before maturity-Dated July 15, 1922; due July 15, 1952-Interest payable January 15 and July 15-Principal and interest payable in gold coin at the Treasury of the United States-Coupon bonds in the denomination of $1,000-Receivable at par under regulations of the Treasury Department as security for deposits of public moneys These bonds are issued under authority contained in the act of Congress approved August 29, 1916, as amended July 21, 1921, and May 31, 1922, and in an act of the Philippine Legislature approved March 10, 1922. 78 PHILIPPINE LOCAL AUTONOMY The legality of the issue has been passed upon by the Attorney General of the United States of America. In rendering an opinion, dated August 11, 1921, as to the legality of bonds issued under authority of the act of Congress mentioned above the Attorney General made the following statement: "This issue and sale of bonds is authorized explicitly by the national power, and while in the strict and legal sense the faith of the United States of America is not pledged as a guaranty for the payment of the loan, or for the due use of the proceeds, or the observance of the sinking-fund requirements, the entire transaction is to be negotiated under the auspices of the United States of America and by its recognition and aid. There can be no doubt, therefore, that the national power will take the necessary steps in all contingencies to protect the purchasers in good faith of these securities." Under the terms of the act of Congress, approved February 6, 1905, "all bonds issued by the government of the Philippine Islands or by its authority shall be exempt from taxation by the Government of the United States, or by the government of the Philippine Islands, or of any political or municipal subdivision thereof, or by any State, or by any county, municipality, or other municipal subdivision of any State or Territory of the United States, or by the District of Columbia. Price, 98 and interest, yielding about 49 per cent. Payment on or about December 21, 1922, against bonds or interim certificates deliverable " when, as, and if issued and received." HALLGARTEN & CO. WHITE, WELD & Co. BLAIR & Co. (INC.). HORNBLOWER & WEEKS. W. A. HARRIMAN & CO. (INC.). Exempt from Federal income tax and from State and municipal taxes-$2,750,000 Philippine Government 41 per cent collateral bonds-Bonds are not redeemable before maturity-Dated June 1, 1922; due December 1, 1950-Interest payable June 1 and December 1-Principal and interest payable in gold coin at the Treasury of the United States-Coupon bonds in the denomination of $1,000-Receivable at par under regulations of the Treasury Department as security for deposits of Public moneys These bonds are issued under authority contained in the act of Congress approved August 29, 1916, as amended July 21, 1921, and in an act of the Philippine Legislature approved March 12, 1922. We are advised that as collateral security there will be pledged $2,750,000 face amount city of Manila 5~ per cent bonds, due 1950. The legality of the issue has been passed upon by the Attorney General of the United States of America. In rendering an opinion, dated August 11, 1921, as to the legality of bonds issued under authority of the act of Congress mentioned above, the Attorney General made the following statement: "This issue and sale of bonds is authorized explicitly by the national power, and while in the strict and legal sense the faith of the United States of America is not pledged as a guaranty for the payment of the loan, or for the due use of the proceeds, or the observance of the sinking-fund requirements, the entire transaction is to be negotiated under the auspices of the United States of America, and by its recognition and aid. There can be no doubt, therefore, that the national power will take the necessary steps in all contingencies to protect the purchasers in good faith of these securities." Under the terms of the act of Congress, approved February 6, 1905, " all bonds issued by the Government of the Philippine Islands, or by its authority, shall be exempt from taxation by the Government of the United States, or by the Government of the Philippine Islands, or of any political or municipal subdivision thereof, or by any State, or by any county, municipality, or other municipal subdivision of any State or Territory of the United States. or by the District of Columbia." Price 99 and interest, yielding about 4.56 per cent. Payment on or about July 19, 1922, against bonds or interim certificates deliverable " when, as and if issued and received." HALLGARTEN & Co. PHILIPPINE LOCAL AUTONOMY 79 Mr. SCHAFER. Will that provision which you wish inserted in the bill, take care of the bond issues in which your firm is not interested? Mr. QUIST. Everything, every Philippine obligation right how. It is in fact something like that, that the Resident Commissioner of the United States shall have authorityMr. RAGON. I suggest that if you do not have anything definite, that it will save time not to read it over. The CHAIRMAN.t You will submit something? Mr. QuST. Yes, sir. It is compulsory for the Philippine government to create a sinking fund to be administered by the Treasurer of. this country, and in the event it is snot fulfilled it will be necessary a an mandatory on the part of the United States to direct the Resident Commissioner to seize the customs, and therefore apply them to these bonds..n the event of immediate independence it will be necessary for us to cooperate with you people on different matters. As far as we are con-,cerned we have no preference whatsoever concerning immediate independence or the Fairfield bill, or anything. We want to impress upon Congress the moral responsibility of the Federal Government in protecting the bondholders who have purchased these bonds. Mr. SCHAFER. Have you prepared a provision which could be inserted in the immediate independence bill, which y6u thirik would protect these bondholders? Mr. QUIST. It is my understanding the consideration is the Fairfield bill, and that is what we have been working on. Mr. SCHAFER. We have also been considering ithe Cooper biill Mr. QUrsT. That has not come up. Mr. SCHAfER. We have had hearings on it. Mr. KNurrSON. The Cooper resolution:was ordered reported. out two months ago, and no action has been taken. The CHARMAN..I think I wsant to say for the record that the Cooper bill has not yet been ordered out. It has never been ordered out by the committee. Mr. KNrTSON. We voted 7 to 11 to vote out the Cooper resolution two months ago, and -I.will stand on that statement. Mr: RAGON. Mr. Quist, I believe you said you had not noticed the Cooper bill. Mr. Qrmsr. No, sir; I have not. Mr. RAGoN. There is a very comprehensive amendment in that, and if you have not read it, I wish you would take this and look it over, because I think it covers what you suggest. Mr. QUIST. I would like to. Mr. RAGON. I will read it, if you will listen. (Mr. Ragon thereupon read the Cooper bill.) Mr. QUIST. That is very good. Mr. BEEDY. I suggest that a broader term than taxes" be used, also "revenues ' and customs. Mr. QursT. I will be veryglad to look that over. Mr. RAGON. I: believe that covers what you want. Mr. WILLIAMS. This is intended to cover the proposition which you havebeen discussing.: Mr. SCoHAER. It is my belief it is intended to cover that provision, but I think it goes too far. 101692-24 —6 80 PHILIPPINE LOCAL AUTONOMY Mr. RAGON. We can discuss that in executive session. Mr. QUIST. Now, first, I think, the Cooper bill on anything like immediate independence would have the effect of causing the bonds to sell off. To-day there is no comparison, in my opinion, between the credit of the Philippine Islands and the people of Porto Rico. The Philippine Islands have a very superior credit. The resources are greater. The bonds are selling at 5.90 and 5 per cent, while Porto Ricas are selling at 4.50 per cent. They used to sell on the same comparative basis, probably because Porto Rico is a little nearer Broadway, but since this question of independence has come about it has caused the Philippine bonds to fall off, and it has been increasingly ite difficulty in selling their bonds. There has been lately the greatest difficulty in selling Philippine bonds, because there has been no definite Philippine policy. We would recommend that. There should be at this time. It is better for the credit of the Filipinos to have a definite policy, whether it is immediate, 50 years' time, 30 years' time, or anything that is provided in this bill. definite policy? Mr. SCHAFER. Do you think after carefully considering the Fairfield bill, 8856, that bill establishes what could be called an absolutely definitely policy? Mr. QUIST. I think it does, concerning the bondholders; it gives them (the Philippine people) a right of plebiscite in 30 years, at which time they have independence. Mr. SCHAFER. It is not definitely decided if they will have independence. It does not definitely decide that at the end of 30 years they will have independence or that they are not going to have it. Mr. QUIST. It provides that choice. It gives a definite term. Mr. SCHAFER. It does not give a definite status. Mr. QUIST. A definite term of years. Mr. SCHAFER. But not a definite status as to whether they will have it after that time. Mr. QUIST. All these bonds will be retired before that time. Mr. BEEDY. May I suggest, Mr. Chairman, that to save time in the future on that question, the question that Mr. Schafer asked of every witness, we will all agree that the bill simply postpones the fixing of the day when they shall or shall not have independence, and allow that number of years-I think 30-to let the people take their chances. Mr. SCHAFER. I have asked questions because of the arguments advanced to me that the Fairfield bill, 8856, determines the definite status uipon which capital can say whether they are going into the islands or not. Mr. BEEDY. That is a matter of argument. The CHAIRMAN. It definitely notifies the capital that at a specific date, 30 years from now, the Philippine people will have the determination in their hands absolutely, and therefore capital will know exactly the alternative in the case, and will be entirely upon its own responsibility, using its own financial judgment, without the Government of the United States being under any obligation, morally or legally, to protect them any more than the General Government would protect. property holders anywhere else on the face of the earth, and in that sense it does determine a definite status for the Philippines. PHILIPPINE LOCAL AUTONOMY 81 Mr. BEEDY. Mr. Ragon suggested in his question a while ago if the bill which might ultimately be agreed upon by this committee should make suitable provision under Government auspices for a sinking fund, it naturally would follow as a matter of law that the bonds would not be tax exempt.' Mr. QUIST. Future bonds would not be. The present bonds would be. Mr. BEEDY. In future they would not. Mr. QUIsT. No, sir. Mr. BEEDY. I understand the question to be, would not that very consideration h'ave some teency to hold the price of bonds already issued by the Philippines? J ~ - Mr.: QTST. If at the end of a period of 30, or 50 years there were a definite policy, when these bonais wbuld mature it would be a different story. ~ i;. -!: Mr. BEEIY. In case any bill delling with Philippine independence were passed and iproVision made for 'this Governmern to o ook after the sinking fund, the fact that future bond issues would be' subject to tax would have a slight tendeicy to hold up the price of previous issues, would it not?: -;';... Mr. QmsrT. Yes,'sir; I think so. There is one more point-that, of course, it is iriuoh better for the credit of- the Philippine Islands to; finance with: 4j;per cent boads rather than 7 or 8 per cent bondsif tley cold the ohem.: TI 'do not know if they could or not.:' I ami ni'otamiiiA with the islands other than' reading a little 'literatre on 'them.: - All of our conduct has been as an instrumentality ofl the'Federal Government, but if they cnld; firane 'it would bea much io6re burdensome rate for themt. It wtrld amount to a great ddeal, and the islands at the present'time are ih need of capitak rint to develop private industries, but for sanitatio4i high, chools, aria piblic improvement.' ' ' They are in need of that capital within the next period of yearsi and tliat must be considered in atn y ddfinite bill' that is i, f there is a great amount of future financinig for aIpeople of '11,000,000, who have only issued $75000,0000 6o bonds1 A'n amount like $75,000,000 of bonds for the Philippine Islands, with their great resources, is not of very great importance after,' as I have said, considering their tremendous natural resources. To develop the Philippine Islands properly you should go in with two or three hundred million of Government bonds. - 'Mr. KNUTSON. Provision could be made for any future issue. Mr. QUIST. Yes, sir; and should be. Mr. BEEDY. As a bond man, you do not have any doubt that if inde dependence should be granted the Philippines it would be impossible for them to issue bonds or borrow money on such favorable rates as has been possible in the past? Mr. QUIST. You can get an idea of that in connection with the Dutch East Indies. They could not' float a loan. They floated a loan by the guaranty of the Government of Holland. I think the present Philippine Islands could, but they would have to mortgage their natural resources, and then I do niot know if they could arrange that. The American public are very ignorant of the Far East and of the investments and possibilities of the Philippines. 82 PHILIPPINE LOCAL AUTONOMY Mr. WILIAMS. I would say that this Cooper bill provision, which provides that before they can do this, in order to protect your bonds that you represent, they can not involve themselves only as these bonds are liquidated to protect the bond. Mr. QUIST. They would be greatly handicapped. I do not know how they could get money. Cuba, Dominican Republic, andi the Haitian Republic can finance, because this Government has a moral obligation there and protects the interest of their bonds and develops the country. Mr. SCHAFER. I would like to ask a question relative to thbe bonds. I had a report from the Department of Domestic and Foreign Commerce. I asked for some information relative to the trade and outstanding bonds here. I have a table showing American investments in the Philippine Islands compiled by the finance and investment division February 8, 1924. It shows the Philippine Government bonds in 1923 of $70,000,000; Philippine municipal bonds of $10,000,000; Manila Railroad bonds, $15,500,000; Philippine Railway Co. bonds, $9,000,000. What I want to find out is whether the Manila Railroad Co. bonds are municipal bonds. Is that a municipal railroad'? It would come within the same rates, because principal and interest are guaranteed by indorsement of the Philippine Islands, and it is an obligation of theirs. Mr. QUIST. They indorsed the 7 per icentf bonds.. The Manila & Philippine Island Railroad, of which you are speaking, steam lines, the 4 per cent bonds, are in part. guaranteed as to interest only; ad the 7 per cent bonds, the small issue, about $1,500,000, they guarantee principal and interest,. Mr. SCHAFER. What I want to find out is if that is a municipal railroad or whether it is a private corporation railroad. Mr. QIIST. The Manila Railroad Co. is a Government railroad. Mr. SCHAFER. It is a Government railroad? Mr. QUIST. It is termed an "instrumentality." It is a private corporation owned bv the government, like the Emergency Fleet Corporation is owned by the United States. It is an instrumentality of the Philippine government. They are not help to be tax exempt, but the government owns the road; they own all the stock except the directors' qualifying shares. Mr. SCHAFER. The Philippine government, to your knowledge and belief, has not guaranteed any bonds of the Manila street railroads, have they? Mr. QUIST. Not the J. G. White Co.: no, sir. That is a private concern like any private concern over there, any private commercial business or anything like that, other than they have a franchise, I guess. The CI-IIRMAN.. You have made a very clear and, I think, a very informing statement. and I wish to thank you for testifying here. Mr. QUIST. I thank you very much. Mr. WILLIAM.s. I would like to ask if this concludes the hearing. If so, I move that we go into executive session on Monday morning. The CHAIRMAN. The Commissioners from the Philippine Islands are here and desire to be heard. Mr. W. LLIAMS. I beg your pardon. Mr. KENT. I have heard constantly that a gentleman by the name of Switzer, who possesses a great deal of valuable information and PHILIPPINE LOCAL AUTONOMY exhaustive knowledge of the: Philippies, was available rd-nd wa to be heard at some tini. Every tims we ask, aboit- >,iery intrea~te matter' Weve have heard- that Mr. ESwitzer was going into that land clear the matter tip. I, would like to hear Mr 'Switzer. Suppoe we put Mr. Switzer on for the next heaiig;,,. - ~ Mr, KNUTSON. You come from New York?; Mr. SWITZER. I am from New York now; yes, sir. < r The CHAIRMAN. Could you be here Mofday -or: Tuesday - Mr. SWITZER. Yes, sir....! i... The CHAIRMAN. I think it is wise for us to take the matter up either Monday or Tuesday, as suits the comnmission. Mr. MACLaFFERTY. Could we not make it Tuesday? Mr. KENT. We asked permission to sit during the sessiot of the House. All they are doing in the House is debating thei Distrit of Columbia's appropriationi bill, and there are 28 or 24 po-ple present. Sometimes there are actually sevet peop'le ivesent. Why can we not have a statement fromt Mr: Switzer beiore lunch? Mr. RAooN. I think *e ought to hear Mr. 'Switzer. Mr. SWITZER. I have a rather lengthy statement, Which I:in rather: inclindd to believe will elicit a great;nahy qiplstions. I fhotild much prefer that I be allowed to' make my statemettit nit;truupted, as it sort of hangs together, and let you gentlemen ask atfiy tqt iA you please afterwards. I am 'quite sure it Wil take ftly ati'/hili, questions and all. i. The CHAIRffA4. Gefntlemen, I think we- will have tb hae a ssibn on the,first of the week, and what I am desirotiU of knowing is whether you desire to go on with the hearing this afternoon. Mr.:MAcLAFPtRTY. I do not think we will db justice to the qtestion by hearing Mr. Switzer now.: Mr. Sitzeri has a great deal f information this committee ought to have on whateVer bill they adopt. I have had experience in appearing before corhttittees (Informal discussion followed relative to the date of the inext meeting of the committee.) The CHAIRMAN. Well, gentlemen, we will meet this Afterio6i Ait 2 o'clock., (Whereupon, at 12 o'clock p, r., the committee adjourned iintil 2 o'clock pim).):.; AiER' RECESS; The committee reconvened at 2 o'clock p. m., pursuant to the taking of recess. The CHAIRMAN. Gentlemen of the committee, you will please come to order. We adjourned this morning, to meet at 2 o'clock, this afternoon, to hear Mr. Switzer. Mr. BEEDY. Mr. Chairman, I think, perhaps, to do the thing thbt Mr. Switzer might desire, I: move that he continue his statment without questioning until he has finished. (The motion was unanimously carried.) STATEMIT OF MR. JOHN W. SWITZER, PRESIDENT PACIICP CO MM9 ECIL CO., NEW YORK Mr. SWITZER. Mr. Chairman and gentlemen of the comtmittee I thank you, because my statement somewhat ties itself together- As whole. I should like to say in the beginning that I am 'afraid I 84 PHILIPPINE LOCAL AUTONOMY have been heralded here somewhat under false colors as being a living encyclopedia on the Philippines. Perhaps that has arisen from the fact that two or three gentlemen, who had to get back to New York and who were here, were allowed to testify in advance of me. I am not an encyclopedia. Mr. KNUTSON. Where do you live and in what line of business are you engaged? Mr. SWITZER. I live in New York and I am engaged in the general export and import business. THE AMERICAN ATTITUDE Contrary to what you may have been told and to what you may have believed heretofore, the largest American interests in the islands take a midway view of the Philippine problem, between the radical Americans on the one hand and the radical Filipinos on the other. We believe, however, we are very much nearer in accord with the views of the conservative Filipinos, when they express them. than we are with the majority of Americans. Contrary to general belief we are not enemies of Filipino aspirations for independence. We recognize we are committed to eventual independence, waste no time arguing that question, approach the problem from that point, and, looking forward, strive, in honor to the United States and in justice to the best interests of the Filipinos, to determine what our next step shall be. Official relations in the islands under the Jones Act are far from satisfactory and some change should be made. It is a question of retracing some of our steps or maintaining the status quo or taking another step toward independence or complete and immediate independence. Here are the four degrees. Brushing aside the fire and smoke of heated discussions and seeing and thinking clearly, we favor another forward step, and to us the problem resolves itself to the United States deciding, first: A definite date after which the Filipinos may have complete independence, if they then wish it. (It is understood, of course, we reserve the right at that time to get rid of them even if they should want to remain with us.) Second: If that definite date be not immediate, then what shall the relationship be meanwhile between those islands and the United States? The Fairfield bill answers both of these. PHILIPPINE AND AMERICAN POLITICS Assuming that we are committed to eventual Philippine independence, if the Filipinos want it, that question, let us hope, is eliminated from American politics. It is the devout wish and hope of all Americans In the Philippines, Democrats and Republicans alike, that our next step may be completely removed from home politics. Our relations with the Filipino people should never have been dragged into our party politics. Our duty to those people is too much of a sacred trust to fall between the upper and nether millstone of our own political parties. When they shall have independence and what their status shall be meanwhile is such a delicate and profund responsibility on the American people's best judgment that a decision should be reached untrammelled by party prejudice or by special interests. The Filipino people, the American people, and the world look to the PHILIPPINE LOCAL AUTONOMY 85 seasoned judgment of America, and not to the far less experienced judgment of even the Filipinos, for a wise solution of this problem. It is America's problem, and you are deliberating on the fate of an empire, and on the fate not alone of the 11,000,000 Filipino people of to-day but of the countless millions yet to be. In the final analysis history will hold the American people, and no one but the American people, responsible for any error in judgment in preparing and starting the Philippine nation on its independent career in the international whirlpool. Due to their home politics the; Filipino politicians have worked themselves into a position, whether they like it or not, and many don't, where the only political issue is independence and the only difference between their political parties is the degree of intensity with which each party claims to advocate independence. That, together with certain controversies with local representatives of the United States impair the Filipino's clear perspective, seriously warp his better judgment, and lead him to request excessive and extreme measures at your hands. I make the bold assertion, and know positively that it is correct, although it will be questioned, that while the Filipinos with apparent unanimity ask for independence they ask for more than many of them expect or want to get. We must not take them) too seriously. Down deep in their hearts and better judgment, many of them prefer. as best for them now, a period of home rule under our sovereignty. While we may believe their extreme request for early and complete independence is unwise, we must not believe them ungrateful and be inclined to give them independence whether it is best for them or not. Any mistake we make in this matter will be our and not their mistake, because we are responsible for their best welfare. In America we have unwisely allowed our duty to the Filipinos to become somewhat of a political issue. What, in justice to the Filipinos and to ourselves, is needed now is to approach this problem in the same nonpolitical, nonprejudiced, common-sense way, as enabled the Dawes committee to brush aside selfishness and prejudice on the one hand and impractical dreams and unbridled altruism on the other, and lay out the course for fair, safe, practical, constructive statesmanship in Europe. From some of the earnest and searching questions asked during these hearings, we are encouraged to believe that the two committees of this Congress without regard to party politics may bring forth a great constructive measure and do the same for the Philippines where our responsibility is far more direct. I beg that these remarks be not construed as presumptuous. Thev are inspired and impelled only because a quarter of a century ago I served my flag on Philippine soil,, and thus came to realize the profound responsibility of my country to those aspiring people, and second, because for nearly a quarter of a century I lived among them, have many warm friends among them, and am, therefore, profoundly solicitous of their welfare. With this experience, this attitude, and let us hope, with a balanced sense of realities and with no political prejudice. I shall, with your indulgence, approach the problem. 86 PHILIPPINE LOCAL AUTONOMY HOME RULE '. INDEPENDENCE I am in favor of the Fairfield bill but am so fearful of the fate of anr independent Philippines even 30 years from now that I suggest the additional proviso that if at the end of 30 years the Filipinos wish independence, they may have it as soon thereafter as the great powers agree by international compact to respect the integrity of the Philippines. If, however, the Filipinos are willing to take the chance and therefore object to that proviso as in a measure leaving their independence somewhat indefinite. I would not urge my suggestion. May I be pardoned for being bold enough to assert that there was; much loose thinking when that part of the preamble of the Jones Act was written which provides that we are " to recognize their independence as soon as a stable government be established therein."' There has been much loose thinking over that phrase since then. The facts are there had been a stable government in the Philippines for 10 years before the passage of the Jones Act and there hAs been one ever since then. If Philippine independence were predicated only on a stable government, then independence should have been granted 20 years ago. There is no more nor less stable government to-day than at the passage of the Jones Act or 10 years before that. But whose stable government was and is it? \Thus far it has been a government of Americans assisted ba Filipinos; a government stabilized by the full power -an nluence of the great American: Republic. What an anomaly to talk to-day of giving the Filipinos independence when they have established a stable government and never as vet have we granted them enough of home rule to give thenl:a fair chance to demonstrate whether or not they can, when standing practically on their own. establish and maintain a stable government.. Seventeen years ago the Filipinos had their first assembly: eight years ago their first senate; the governor, the vice governor, theauditor, the majority of the supreme court, and several judges of first instance are still Americans. For a little over 20 years it has been a government of Americans assisted by Filipinos, and that was the first and only time in history when Filipinos even assisted and thus participated in their own government. Prior to the brief period of the American regime they had little opportunity and less help to advance themselves socially, economically, politically. In, the light of all this, would it not seem wise that the next logical step toward independence is to reverse matters and have a period of years of government of Filipinos assisted or guided by Americans? That, for the first time in history, will give the Filipinos. themselves and not the Americans an opportunity and experience of establishing a stable government. It would seem that prudence on our part would call for such an intermediate period of home rule under our guidance before plunging these ambitious but comparatively inexperienced people into complete and absolute independence. The genius of self-government comes not like poetry. It is acquired by years of education and actual experience. This suggestion is no reflection on these good people. ILet us assume for the sake of argument they could to-day establish as stable a government as prevails generally throughout the Far East. Is that the index of ourideas to-day of what we propose to do for these unsought wards. PlILIPPINE LOCAL ATTONOiMY 97 after charting for them a course and helping them start on Atnerican social, political, and economic standards' Will that satisfy our pride and hopes connected with this unsought undertaking? We expect far more than this and besides we must not overlook the international dangers beyond their control and the economic aspects we shall discuss later on. Under our policy of complete unselfish kindness and helpfulness, unparalleled in any colonial history, these people, to their great credit, have responded and developed accordingly. With such a history as theirs back of them and with such a treend osu s~irig of the pendulum in a brief 26 years one must not' be surprised iat the ambitious Filipino now asking for complete independence. 'He may be intoxicated with his new experience, btt we must not lose our heads. There is as much reason and justification for giving these people a period of years of a government of Filipinos assisted by Americans as there was to have given them a period of government of Americans assisted by Filipinos. We either should never have remained in the islands at all or should remain long enough to perform our task creditably and with reasonable completeness. Thus far we have done -ell our unsought duty to them, but lAt us not now spoil our good record by being swept from our feet to give them prematurely complete independence and run the risk of setting them back many more years than the intermediate period we suggest of home rule under our guidance. Many of us who fought for their freedom on their own soil and have their best interests deeply at heart believe that is our duty to them. As the responsibility of an error in this matter rests solely oh the American people, is it not a wise precaution for our own record of being sure of doing what is best for these people.; to thus put on them for a period of years the full responsibility of government reserving to ourselves, if they go far amiss, only that measure of authority which is commensurate with our remaining responsibility? They will make mistakes, they are human, but they will learn by their mistakes. To give them now home rule means practically independence so long as they do not go astray, and by our retaining sovereignty during this home-rule period it will not be too late to counsel, correct, and help them. Who could wish them more success than we? We shall thus and only thus be doing our full duty to the' Filipinos and to ourselves. You will thus have given them the opportunity which they have never as yet had, of themselves establishing a stable government. Thus we shall have lived up to the spirit and intent of the American people to prepare the' Filipinos for indepenidence. No one can say we broke our word and we shall have' done the very best for the Filipinos. No promise of independence, expressed or implied, calls nn us to go faster and further than this, and our full duty to the real welfare of the Filipino people calls a halt here. To go further than this now would be unbalanced, impracticable, unkind altruism without rudder or anchor. The world knows we were not seeking conquest when the Philippines fell to us. An unsought duty was left at our door and until now unselfishly and faithfully have we striven to fulfill it. As we are responsible for the performance of that duty we must be the judge of when we have completed it and I resent when, because we 88 PHILIPPINE LOCAL AUTONOMY feel our unsought duty is not yet completed, we are charged with being "benevolent despots." Although it is only about 20 years ago when for the first time since the light of history the Filipinos were permitted to participate in their Government, even to a very limited extent, yet, because we propose to give them a period of preliminary training of home rule instead of immediate and complete independence we are chided as being "benevolent despots."' Is it not about time we stood on our dignity, recognized our responsibility, had the courage to judge for ourselves what our duty is, and 'went on manfully performing it? Were we now to grant complete independence, and it prove a colossal blunder, the world will not assume with us the blame for our folly. We must bear that ignominy alone, so let us chart our own course unintimidated by the blind and unfair charge of " benevolent despotism." THE ECONOMICS OF THE PHILIPPINE QUESTION During the past four years, like most of the world, the islands have undergone a period of severe deflation and suffered correspondingly heavy losses. Everyone, even the most ardent advocate of complete independence, admits independence would be a most severe shock to the already crippled economic welfare of the islands. Fearful of the effect of such a step, unquestionably capital already so sorely needed would leave the islands in large quantities. How long it would be before new capital would again venture there no one can foresee. It can not be denied that the severance of free trade with the United States would fundamentally dislocate the whole economic structure of the islands. Many of the tobacco and most of the sugar enterprises in the islands are in most precarious financial straits already, but the severance of free trade with the United States before these enterprises get onto their feet would shove them over the precipice to complete economic ruin. It has been stated before the committees of Congress that the principal articles of export which would be seriously affected by severance of free trade constitute only 25 per cent of the total exports of the islands. The facts are that for the year 1922 the exports to the United States which would have to pay duty but for our free-trade relations amounted to $45,594,000 and constituted 48 per cent of the total exports of the islands. The standard of wages and living based on economic conditions brought about by the American regime would, under independence, require drastic reductions with what might be serious consequences. On top of all this everyone admits that, under independence, government expenditures must greatly increase. Therefore, taxes must increase accordingly-all at a time when the economic condition of the country would be able to stand less rather than heavier burdens-when 48 per cent of the exports would be practically ruined. As it is, the revenues for 1923 were the lowest since 1918. In 1922 the islands saved in duties on their exports going to the United States $27,500,000 over and above the duty they forego on United States goods entering the islands free of duty. It has been stated here that the United States annually loses this $27,500,000 net duty. But if we don't collect it on Philippine products the American consumer pays the equivalent in the way of duties on the PHILIPPINE LOOAL AUJTONOMY 89 same goods which must be imported from somewhere. So where are we worse off? We annually turn over to the islands about $1,000,000 internal revenue collected here on Philippine tobacco and cigars. Here is a total of $28,500,000 per year the islands lose immediately after independence. But that is not all. The Army and Navy each year spend in the islands several million dollars for maintenance of troops, equipment, etc. Besides the Army and Navy officers and men and their families each year spend in the islands considerable of their salaries and other income. All this business would be lost. Moreover, many American tourists go to the islands to-day, because of American occupation and spend money there. Most of them would not go there under independence. All told, it is safe to say the islands to-day are thirty to thirty-five million dollars annually in pocket which they would lose under independence. Besides, under independence, they would have to bear many additional expenses they now escape, among them the cost of sufficient military forces, if for internal safety only, the entire cost of diplomatic and consular corps, and at least 3 per cent higher interest rates on any new loans they might make after the moral responsibility of the United States was no longer back of their bonds. Does not all this seem a serious matter for an inexperienced people to undertake completely on their own responsibility, especially when their estimated total revenue for 1924 is only $34,000,000 and their budget for that year, even under present rate of expenditures, is $33,000j000. Is it any wonder that Secretary of War Weeks told you recently that "it has not been made apparent in what way the greatly increased expenditures of an independent government would be met by the greatly reduced revenues which must follow from that independence. To thus deliberately bring about an economic upheaval on top of the post-war depression, to incur heavier current expenditures, to create conditions where less revenue will be available, and to saddle this dilemma onto a newly organized and inexperienced government seems to me an uncalled for economic suicide and an unfriendly act to the Filipino people. New and inexperienced governments generally have their greatest difficulties over matters of finance and here we would launch an independent state financially crippled at the borning. You have been told that we Americans interested in the islands oppose independence because that deprives us of the benefit of free entry of Philippine products into this country. We openly and frankly admit that is one of our reasons and offer no apology for it. There are some Americans here in the United, States advocating independence, as the friends of Philippine freedom, but unwilling to admit openly that in reality they want independence so as to abolish the reciprocal free trade relations and shut out such Philippine products as compete with their own interests. What injures us injures the Filipinos as well. As business men we see for both Filipinos and Americans dangerous financial rapids ahead of near-by independence, and as real friends of the Filipino, as well as looking after our own interests, we sound the warning even though we be maligned for it. To experienced Europe, where we have so scrupulously avoided entanglements, we were invited and sent American business and financial common sense to point the way out of economic chaos; but to the inexperienced Philippines, where complete responsibility rests 90 PHILIPPINE LOCAL AUTONOMY on us and on us only, American business and financial common sense should not be looked upon askance and thoughtless or impracticable altruism allowed to point the way to premature independence and economic ruin. If we were really oppressing the Filipino people. one could not blame them for making supreme material sacrifices in order to gain their independence; but who will say that granting them home rule, after only a little over 20 years of any participation whatsoever in their own government, is so oppressive as to call for these economic sacrifices. Since the passage of the Jones Act in 1916, practically no capital has gone to the Philippines because of the uncertain relations of the islands to the United States. That will continue until that status is definitely settled. Mr. Roxas says, and we all know it is true, that the islands are in great need of capital. Their development is far from that of Porto Rico. To-day capital does not want to go there because of the indefinite status, and the Filipinos do not want it to come because they believe each new dollar of foreign and American capital is an additional obstacle in the way of ultimate independence. To solve this deadlock we urge that it be definitely decided by the Congress and President of the United States that at the end of 30 years, and not before then, the islands may have their independence, if they then wish it. The Filipino people thereupon will at once welcome American and foreign capital, because it can no longer interfere with their ultimate independence, which they know they will automatically get after 30 years, whether capital then likes it or not. Their minds will be taken off of independence, the sole subject of political discussion to-day, and directed to the upbuilding of their social and economic welfare. Moreover, new capital will go there in abundance because it knows definitely the status of the islands for 30 years and that is long enough for it to take a chance. A shorter period would defeat one of the main purposes of this bill, which is by giving them a definite status and reciprocal free trade with us for 30 years will assure them economic independence. A shorter perior will not attract capital nor put the country onto its feet economically. What better proof could one wish of the benefits of a definite status than the comparative developments during the past 20 years of Porto Rico and the Philippines, both of which have had the same reciprocal free trade relations with the United States? Porto Rico has had the definite status of being part of the United States with assured free trade. Had the development been as rapid during that period in the Philippines as in Porto Rico' the Philippines to-day would have annually 50 per cent or $108,000,000 more external trade than they now have. The development of even Porto Rico is still in its infantry. Capital will know that with the protecting and restraining influence of American sovereignty over the Philippines it will be reasonably safe. It also knows that free trade with the United States is practically certain of continuance. Besides capital believes that with 30 years of home rule one of two things will have happened. First, the Filipinos will have become so satisfied with and so understand better than they do to-day the advantages of home rule under our sovereignity, and will have become so prosperous under the trade relations with the United States that they will wish to continue the relationship. Or, second, with 30 years of home rule the Filipinos will have learned so much .PHILIPPINE LOCAL AUTONOMY 91 'by experience in responsibility of Government they will then be ready to canrry on an independent state with a muohi greater degree of the world's confidence and with an infinitely less:economic shock than they would sustain under nearby independence to-day. Enterprises now totteringwill have gotten well onto their feet and better financially entrenched to withstand whatever shock there then may be. Capital will not flee the country. On the contrary it will have' been prepared for the change of status, if that must icme, and r m ore or ess already have become 'accustomed to praticalmly an independent Government. Fiblpinos will have grown miore experienced in: the, economic development of their country and themselves will be able to securie capital abroad.,Meaiwhhilei capital will have gone, there:in.great amounts, developing the various resources, and the country will unquestionably be most prosperous, with' a resulting: larger revenue tot meet the increased expenditures. The islands' finances should be in excellent shape. Handling themselves wisely they may not be compelled to pay 3 to 4 per cent higher interest on new bonds than they pay to-day. After 30 years of prosperity, rather than after a period of depression; after 30 years of capital going there, rather than leaving and staying away as during the past 10 years; after 30 years of actual practice in home rule, thus getting the confidence of the world-then, if they wish it, the Filipinos will be better able to start on their own with a fair-chance of success Instead of launching them to.day crippled from the start. AMERICAN HOLDERS OF PHILIPPINE BONDS So' muhn for the interests of the Filipinos and the islands in general, and it is, of course. the welfare of the Filipinos we must always first consider and that must control. But while doing this, and without prejudice whatsoeyer to the Filipinos, let us also consider the Americans. Thousands of Americans, poor and rich alike, hold the $76,000,000 of outstanding Philippine bonds which they purchased on the basis of a high price and low interest yield (practically as low as that of our own Government) because they knew the United States was morally back of those bonds. Some of those bonds have about 30 years to run. From day to day some of the holders of these bonds wish to realize on them. Will anyone be so bold as to deny that if independence were granted to-day and if the United States did not specifically guarantee or safeguard those bonds, that their market value would at- once shrink to such an extent as to be a calamity to many; poor holders? Everyone with even the most elementary knqwledge of the bond market knows that is true. Contrary to impressions left' with you, only about one-half of the bonds outstanding are selfliquidating. Practically all the interest and sinking fund for the balance must be appropriated from general revenues. You have also been told that-some twenty-three or. more millions of dollars of gold standard. and treasury certificate funds on ideposit with American banks could be, applied against the payment of these bonds. If that were done then what wiil support the cu.rrency of the islands? Let no one stick his head into the sand: and say the United States hasno iworal responsibiity back of these bonds. It has, and any other.attitude is, unbecoiniag the iUntited States and sasers of e 92 PHILIPPINE LOCAL AUTONOMY pudiation. Where, then, is the logic, and what is the call to handicap the Filipino by premature independence and on top of that ruin many Americans? But, if during the 30 years life of those bonds we retain the sovereignty over the islands, we give. on the one hand, the Filipinos the blessing of prosperity and the advantages of home rule, and, on the other hand, we protect the American bondholders against financial ruin. In both of these cases we shall have fulfilled our moral obligations. During the forthcoming 30 years should the Filipinos wish to sell more bonds, and they may well do so, but if those bonds mature beyond the period of 30 years, it should be made clear to those who buy them that they do so only on the credit of the Philippines and with no moral or other obligation of the United States back of them. In this way, no one holding bonds after 30 years can have any complaint. We shall have kept faith with the present and not misled future bondholders. That is fair to all. AMERICAN INVESTORS IN PHILIPPINES There is another body of Americans whose interests also are entitled to consideration. It has been said before committees of Congress that, exclusive of investment in Philippine bonds, Americans have only $15,000,000 in the Philippines. The facts are that outside of the $76,000,000 invested in Philippine bonds, fully $100,000,000 of American capital is otherwise invested in the islands. much of it in fixed investments. The large majority of this was earned and not brought there. Let no one be misled, in considering this question, by the charge of exploitation by Americans. By an act of Congress, ownership of lands is limited to 2,530 acres by corporations and 247 by individuals. On less than the fingers of one hand can be counted the American corporations owning 2,530 acres. The number of Americans in the islands is almost nil except those who remained there after the wars or went there as poor men seeking opportunity, the same as after our Civil War our soldiers and others emigrated to the West to develop our own country. So careful have we been to avoid exploitation by Americans that many Filipinos think we went too far, and it would be no surprise to me if, should this bill pass, the Filipinos themselves liberalize the land and mining laws. While there are no statistics on the subject, nevertheless, contrary to statements made before committees of Congress that most of the 6,000 Americans in the Philippines went there originally as officeholders, it is my judgment that a very considerable majority of them went there in the wars, remained to engage in business, and very many of them have their life's savings invested there. Those same Americans, after serving their flag, did not ask Congress for a cent of bonus. Although it is a quarter of a century since they served their country, nevertheless, I do not know of a single one of them, even as yet, drawing a pension. Are those men who gave so much and asked for nothing to be abandoned now, when age creeps on them? With the sturdy, self-reliant spirit of the pioneer, proud of the opportunity to have served their country and ask nothing for it, they went to work to develop the islands they fought to free, to make an honest living, and to lay up a competence for their PHILIPPINE LOCAL AUTONOMY 93 families. Many of them rendered distinguished and unselfish services to the Filipino people. While some Americans over here who never saw the Philippines or who studied the Philippine problem from the deck of a trans-Pacific steamer, or who themselves have nothing at stake, may advocate immediate or near-by independence, and while some Filipinos, unwisely, we think, for the sake of premature independence may be willing to suffer economic chaos and ruin, but what about the Americans who also served that country and have their all at stake there? I make no apology for calling attention to them, most of whom are small holders and are 10,000 miles from here, with no opportunity to be heard. It has been said here that Americans who invested in the islands did so at their own risk, knowing of the indefinite tenure of American sovereignty. Speaking for myself, and, I am sure, for thousands of other Americans who started with little or nothing and invested what they made, let me say that knowing conditions in the, islands as we did we could not have foreseen that Amrerica would be so unmindful of the Filipino's best interest, woulcl so abandon a task half done, would be so selfish, or would let unbalanced altruism so influence her as to inflict independence on the Filipino people within our lifetime. That is our answer. We are there, and immediate or anything like immediate independence would ruinus as it would the Filipinos. The question is, how can we do justice to the Filipinos and. also to the Americans? That is not as difficult as it might seem. It is axiomatic and should be obvious to anyone that whatever is beneficial to the Filipinos is beneficial to the Americans, and whatever is harmful to the Filipinos is harmful to the Americans. Those interests are identical and inseparable. Here again, the period of 30 years of home rule under our sovereignty which, we have shown is best for Filipinos will also be best for the Americans. That period is about long enough, but none toolong, lto prevent a heavy shrinkage of investments of Americans and Filipinos. During that period those who wish may realize on their investments and leave; those who would not so wish,, and others, who make new; investments, will do so at their own risk with definite knowledge that at the end of 30 years they may expect independence. Thus justice is done to all. COST OF THE PHILIPPINES TO THE UNITED STATES By remaining in the islands at all and undertaking to prepare the Filipinos for an independent national life we assumed an obligation from which we can not honorably run because it is costing us something. But to satisfy even those who may complain of the cost let us set forth the facts. The misinformation regarding this whole Philippine question is well illustrated by a certain House resolution introduced during the present session, wherein the statement is made that if independence were granted it "would save the American taxpayers millions if not hundreds of millions of dollars annually," etc. According to the War Department, if we withdrew from the islands.and kept military and naval bases "there would probably be no saving," and "the complete withdrawal of the United States. from the islands would result in a direct saving not to exceed $2,000,000 per annum." Admiral Jones has told you correctly that "the mere fact that we have owned the Philippines 94 PHILIPPINE LOCAL AUTONOMY has not caused the growth of the Navy nor has it increased materially the expenses of the maintenance of that Navy." Lest we forget, let it be recalled that the training received by our Army and Navy in transporting our men overseas and caring for them in the Philippines no doubt saved many thousands of lives in the late war, and saved in expenses probably several times more than the total cost of the Philippines since Dewey passed Coregidor in 1898. Neither must we forget that Army and Navy forces in the Philippines have been called on in the Boxer and several other emergencies in the Far East and unless some magic influence comes over the Orient those forces for years to come may again be required any time, even in larger numbers and with greater urgency than heretofore. With all these facts before us, considering also our duty to the Filipinos and our interests in the Orient, who will longer concern himself over the direct saving of only $2,000,000 per annum by our complete withdrawal from the Philippines? INDEPENDENCE MENACE TO THE PHILIPPINES T'he charge is made that the Philippines are a menace and sources of weakness to us. Let us, as we should, consider this first from the standpoint of the Philippines themselves. If they are a menace to us, then some one covet them. All eyes are turned to Japan. If Japan so covets them as to be a menace to 110,000,000 Americans, then what chance have 11,000,000 unprotected and independent Filipinos of resisting her? Five hundred million independent Chinese could not do it, and 15,000.000 Koreans have been ruthlessly subjugated, thousands and thousands of them exterminated. Your committees have been told that the Japanese do not want to go to a tropical country like the Philippines, but they go to Mexico, Central America, Hawaii, and tropical islands under Japan's sovereignty. Forty-three per cent of the population of Hawaii, or, in other words, 110,000, are Japanese. The southern tip of Formosa almost touches the northerp point of Luzon. It is admitted even by the Japanese themselves that there are in Formosa 175,000, but it is generally conceded that there are nearer one-half million Japanese who have become overlords to the inhabitants of that island. That more did not go there was not because of the tropical climate but because the population of Formosa is already 102 per square kilometer. while that of even Japan itself is only 145. As proof that the Japanese did not emigrate to the Philippines you are cited the fact that for hundreds of years they never attempted to go there in large numbers. But that statement overlooks the fact that only in the lifetime of those here present did the Japanese in numbers leave their shores for other lands. As recently as 1916 the total number of Japanese residing in countries not subject to Japan itself was only 371,000, and, as evidence of the rapidity with which they are now emigrating, official figures show that within four years from that date the number of Japanese residing abroad had increased nearly 60 per cent or 210,000. What chance would independent Philippines have of resisting Japanese immigration? That the Japanese have not flocked there during American occupation is not strange nor due to the climate. PHILIPPINE LOCAL AUTONOMY 95 Seven or eight years ago Japanese were going to the islands in large nuubers, taking up many thousands of acres of the finest hemp, Wcconut, and rubber lands. They considerably outnumbered the Americans in the islands, then, and still do. Accordingly great apprehension arose among the Filipinos. The Filipino Legislature secretly passed an act so pointedly aimed at preventing Japanese acquiring Philippine lands that for that reason the measure failed to become a law. In 1920 Japanese bought a 13,000 acre estate almost up against the city of Manila, and through which passes for nearly 1 mile the only water main supplying that city. Three thousand farmers and citizens affected by that sale, headed by the governor of the province, walked 10 to 15 miles to protest to Governor General Harrison, in part as follows: Knowing as we do through the American press, the practices in Korea, Formosa and other places in this archipelago, together with concrete evidences which we have recently seen and experienced and the absolute disregard of the law of contract, we simply can not live peacefully with the Japanese side by side, nor would we care to work under them. In order to avoid trouble, the Japanese, soon after buying this estate, sold it to Filipinos. But is it reasonable to believe that they would relinquish their grasp on such strategic lands if the Philippines were independent and the power of the United States were not back of them? About the same time as the above incident Japanese were stopped from purchasing a large estate more or less in a position to command and menace Corregidor. Does any Member of Congress who studied our own immigration bill recently believe an independent Philippines could resist Japanese immigration? Japan realized by that time that she was overplaying her hand and doing it prematurely. She then began to realize the extent to which the Filipinos, the Americans, and the whole world suspected her intentions toward an independent Philippines, and she realized that if her nationals continued to flock there in large numbers, that, above all, would arouse suspicion and prevent independence. Not only was Japanese immigration checked, but the number in the islands has actually decreased. Is it not a little strange that Filipinos so soon forget all this and are so easily lulled to a sense of security by Japan's studied inactivity and assurances of noninterference? How can they have forgotten, or how can anyone forget, that during the life of those who are still children, Japan within six years, after solemnly guaranteeing the integrity of Korea, absorbed and subjugated that country of 15,000,000 people as completely and ruthlessly as did any monarch of the ancient world. At the time Japan joined her ally, Great Britain, in the late war, Count Okuma is quoted as sending the following cablegram to the United States: As Premier of Japan I have stated, and now again state to the people of Amnerica and of the world, that Japan has no ulterior motive, no desire to secure more territory, no thought of depriving China or other people of anything they now possess. Within five months of the sending of this cablegram Japan, at first secretly, lodged with China her outrageous 21 demands. In the face of this Filipino leaders for independence still cite this cablegram as sufficient assurance of Japan's good intentions toward an independent Philippines. 101692-2.4 —7 -7 96 PHILIPPINE LOCAL AUTONOMY Your committee has been told that the Japanese went to the Philippines to develop hemp plantations when the price of that article was extremely high during the war and have since left because of the decline in price. But every article has declined in price since the war-time peak. But why should the Japanese leave for that reason when Filipinos, Americans, Chinese, and other nationalities still continue to raise hemp? The Japanese almost ceased going there, and the number already there has decreased because Japan realized she was arousing suspicions which would delay Philippine independence. She prefers to bide her time, wait for the independence she insidiously encourages in the Philippines but ruthlessly violates herself elsewhere. "Come into my parlor, said the spider to the fly.' Whether the Philippines remain independent or fall into her hands, Japan knows she will be the winner. Her trade with the islands is now second only to that of the United States. If the Philippines were independent, she knows that on equal tariff terms she would take from us at once perhaps the majority of our export trade to the islands. While doing this she would offer the Philippines in return no market for their exports, as we do to-day, because she would give preference to sugar, tobacco, vegetable oils, etc., from her own tropical domains. If the Philippines fell into Japanese hands, as we firmly believe they would, she would immediately inaugurate the same tariff policy as she has in Korea and Formosa, with the same results, namely, exclusion of the products of other countries which compete with what she produces within her own Empire. Ninetyfive per cent of Americans and foreigners versed in Far East affairs will confirm these views. Within the lifetime of all here present Japan has acquired over 43 per cent of the total area under her sovereignty. She acquired Formosa, Korea, Saghalien, and several groups of islands, some fully within the Tropics. She has Manchuria and inner Mongolia by the throat, attempted the rape of Siberia, and was caught with Shantung in her pocket. In 1915 Count Okuma, Premier of Japan, is reported to have said: Those who are superior will govern those who are inferior. I believe that within two or three centuries the world will have a few great governing countries and other countries will be governed by them, will pay homage to the mighty. In other words, about four or five great countries will be developed and the other countries will be attached to these great ones. For instance, England, Russia, Germany, and Japan may be such countries. We (Japanese) should from now on prepare ourselves to become a governing nation. Almost immediately after the Premier is reported to have made the above statement he lodged with China the infamous 21 demands. Evidently he did not intend to lose much time in putting into practice his theory of the consolidation of nations. It is interesting to note that America is not reckoned as becoming one of the four or five great countries. Let us get a larger view of the Philippine situation. The Philippine Archipelago consists of over 3,000 widely scattered islands with a coast line out of all proportion to its area. It is inhabited by less than 11,000,000 people of Malayan origin. It is adjacent to the greatest continental area and population center of the world. Almost half of the world's population lives within a 3,500-mile radius from it. On the borders of two great oceans and crossroads PHILIPPINE LOCAL AUTONOMY 97 to the greatest trade routes of the future, its strategic and comnmercial importance can not be overestimated. Forty-seven per cent of Japan's foreign trade goes southward past the Philippines. The archipelago's large, undeveloped, fertile area, its 41,000,000 brm of public lands suitable for agriculture, to say nothing of millions of acres of forest lands, a country sparsely inhabited and capable of producing enormous quantities of every tropical product, is a tempting morsel to hungry powers and especially to the overpopulated near-by nations. Its disproportionate coast line is at once an asset and a liability. Unlike interior continental countries with definite boundaries and few neighbors, its exposed insular location on the world's greatest strategic and commercial crossroads renders it subject to the dangers of aggression from every corner of the earth. It might not be so difficult for the Filipinos to secure their absolute independence from generous America, but once obtained and found to be a mistake, it might be, owing to international complications, impossible to retrace that step. Advocates of Philippine independence find safety from aggression in the four-power treaty of the Washington conference. But they completely forget that the treaty applies only to the "insular possessions " of the signing powers, so that an independent Philippines would derive no protection under that clause. Who believes that to-day Japan would allow any other power to acquire control over such a strategic and near-by territory as the Philippines once those islands were independent? These larger aspects submerge the lesser questions of what the Filipinos want or the Americans prefer and impel consideration of the international factors and the inevitable trend of international events, political, social, economic. We can not say as yet that the Great War enthroned international justice. Is it not therefore the part of real kindness and duty to retain our protecting sovereignty over the Philippines for let us say at least 30 to 50 years, a brief time in the history of nations, in the hope that meanwhile Japan will recover from her mad career of conquest; that the world will have settled down to an angle of repose after the Great War earthquake. Possibly by that time, far less than now, will it be a case of "vessels large may venture more, but little boats should keep near shore." PHILIPPINES STRENGTH RATHER THAN WEAKNESS TO THE UNITED STATES; Let us now consider the charge that we should get rid of the islands, bag and baggage, because they are a menace and weakness to us. I was only a volunteer, therefore, can not claim to be versed in the science of military and naval strategy. However, even as business men but with intimate knowledge and considerable study of our relations with the Far East, we have always held the views so clearly and forcefully stated recently before the Senate committee by Admiral Jones. While other nations are. and will continue wide-awake to their future interests in the Fart East, we ourselves must not be lulled to sleep by the siren Washington conference. Possibly the results of that conference were an excellent beginning, but only a beginning, and we must not overlook that the limitations agreed upon by that con 98 PHILIPPINE LOCAL AUTONOMY ference are of a temporary character which may be changed "almost at any time under certain conditions." Since the day of Caleb Cushing in 1844, and particularly since the day of John Hay, one of America's principal policies is the open door in China. Japan has indorsed it by lip and violated it by hand. That together 'with her unquestioned ambitions to control the Far East to our detriment, but not our possession of the Philippines will, if anything will, bring us into a conflict with her. "From a navy point of view," Admiral Jones correctly told you. " the situation in the Far East seems to be more unsettled and more pregnant with disturbing possibilities than any other section of the world." "It will be wholly impossible," he continues "for the United States to make its influence felt through naval effort in the Far East should international situations arise demanding operations by the Navy in that area, if it does not have a naval base or an ally in the Far East." "It should be realized, however," says another naval authority, "that the Washington conference has emphasized the Pacific situation in this respect. For, under the agreement that the United States shall not make. effective its naval bases west of Hawaii. that group of islands becomes our most westerly effective base. But Hawaii is nearly 3,500 miles from Japan, and a mlodern batttle fleet has an effective operating radius of only about 2,000 miles from its base through waters likely to be infested by submarines. Consequently it would be impossible for the American battle fleet to reach Asia in war time without first blasting its way to an advance base-an operation which might take vears." Does this not make it clear that the retention of the islands in a strength and not a weakness? Naval forces and a naval base in the Far East " has added very nmuch to our national influence in far eastern questions." The conmplete abandonment of the Philippines is to abandon our open-door policy and is, as Ad-miral Jones put it. "Tantamount to abandonment of our ability to protect our interests in the Far East." To us who know the Far East it is clear that to do this we are courting trouble and not avoiding it. Our rights throughout the Far East would ble flaunted because we will be far less able to defend them. and we must either step back to the position of a secondary power or fight and then find ourselves handicapped seriously for want of proper bases in the operations. We are more likely, therefore, to have a war if we have no powerful base in the Philippines than we are with one. Japan respects force far more than justice. Moreover, as already shown, once we give the Philippines independence we have no more rights there than has Japan. But were Japan to take the islands and we saw our "love's labor lost" would we, after all, stand by and without a struggle allow her to take them? We say we would, but would we? And with no base there or anywhere else in the Far East we shall have most fatally crippled ourselves bv our own acts. If in legal difficulties, we go to a lawyer; if sick, to a doctor; and if our national safety is involved, why not take the advice of our ablest military and naval experts? As Admiral Jones states. and as we all should know, our " Navy has to be strong, not because of the Philippines nor because of any one particular country or island in which we may be interested, but because the Nation is great and be PHILIPPINE LOCAL AUTONOMYlY 99 cause its interests are world-wide and because those interests can not be; safeguarded by words." A far-eastern base in the Philippines will be the equivalent of several battleships, possibly many of them, and costs far less, and thus greatly strengthens our Navy. The Philippines are, therefore, a national strength and not a weakness to us, unless we wish to abandon completely our interests in the Far East and, worse still, abandon the Philippines and China to the fate of Korea. In order to keep down the length of this statement, I have not been able to develop this naval question and this so-called menace to us as it should be or as I intended. Therefore I beg leave to have inserted in the record as part of my statement, if this committee will be, gracious enough to do so, the following articles: " The Philippines and sea power? and "Realities in the Far East." They are by William Howard Gardiner, a relative of and, I believe, collaborator with the late Admiral Mahan. He is vice president of the Navy League of the United States, secretary of the Naval History Society, member of the United States Naval Institute, and an authority on naval power in its relation to statecraft. From these articles it is shown that while we have stood for the open door in China, that by abandoning the Philippines to Japan we pave the way for a closed door in the whole Orient in the years to come. BENEFITS TO BOTH PHILIPPINES AND UNITED STATES OF CLOSE COMMERCIAL RELATIONS BETWEEN THE TWO The greatest current of commerce to-day flows between Europe and the United States, two Temperate Zone countries. This is due chiefly to difference of conditions between a new country on the one hand and an old and thickly populated one on the other; but as rapidly as. the United States develops, increases in population and manufacturing, so rapidly will the conditions in the two countries tend to become similar and the commerce between them will decrease relatively compared with their total trade. As our population is increased and as our output of manufactured products increases, the proportion of exports of foodstuffs and raw materials compared with our exports of manufactured articles decreases. Had all the Temperate Zone been settled and developed simultaneously and had transportation been as it is today, the natural flow of trade long since would have been relatively greater between the Temperate and Tropic Zones than between parts of the Temperate Zone. The greatest trade route of the future will be between temperate and tropical lands. Nature willed it so and ou can not get away from it. The Temperate Zone will always be the manufacturer and the tropical the producer of raw products. One complements the other. The natural field for our expanding exports of the future is the Tropics. In 1913 the United States consumed more tropical and semitropical products than did the United Kingdom, France, Italy, and Belgium combined; perhaps consumed more than all Europe combined, and yet of the tropical demands of the world, European powers controlled 59 per cent, 40.38 is independent, and 0.62 belongs to the United States. In other words, while we consume about as much tropical and semitropical products as all Europe, yet Europe controls 59 per cent of the tropical domains 100 PHILIPPINE LOCAL.VTONOMY of the world, while we control about two-thirds of 1 per cent; and yet we hasten to get rid of a tropical empire. The ingenuity of man can not easily get around nature's climates. We must go to the tropical countries for raw tropical products, and, in fact, we must look to the tropical domains more and more for the outlet of our manufactured products. To-day we are practically at the mercy of Europe for perhaps the largest portion of our raw tropical products, which come from their domains. About one-third of the human race is living in colonial dependencies. Eight European powers, with an area of less than 1,000,000 square miles and a population of about 130,000,000, hold colonial possessions amounting in area to about 21,000,000 square miles and with a population of about 525,000,000. We have somewhat carried in our minds the idea that the great powers of the world secured their colonial possessions many years ago, but, as a matter of fact, during the present generation more than perhaps during any equal period has there been a mad scramble for colonies. The W1orld War created an economic condition which has already spurred the gTeat commercial powers to greater efforts to secure for themselves a larger share of the world's commerce. It is manifested not alone in the race for colonies, but in the system of preferential tariffs between the sovereign power and the colonial possession, and these preferential tariffs have been spreading very rapidly in recent years. Great Britain, since the annullment of the navigation acts which were another form of preferential tariff was rather free of this policy until after the late war. In her last imperial conference, preferential tariffs became an accepted principle. Trade within the Empire is to be promoted by a system of preferential tariffs. France is far less liberal than Great Britain in this respect. While there is free trade between her and her colonies, nevertheless imports from other countries into her colonies carry the full French tariff. The same preferential policy is followed by Italy, Spain, and Portugal. Holland being less of a manufacturing and more of a trading nation does not discriminate. Due to the terms under which Belgium acquired the Congo, she can not discriminate. Japan imposed in her colonies the full Japanese duties on all products coming from other countries. Thus equality of opportunity in colonial trade has become the rare exception rather than the gprowing' rule. England, France. and Holland carried on their greatest and most of their wars ever questions of interference of trade. At tlhat time, this interference was in the shape of navigation acts and Napoleonic embargoes. To-day it is in the guise of preferential tariffs. That this nmav easily become a menace to world peace may be deduced from the fact that in 1913 the commerce of the colonies constituted almost one-fifth of the whole international commerce of the world. or, in other words, about $8,000,000,000. That this trade with colonial possessions, most of which are in the Tropical and semiTropical Zones, will become more and more a bone of contention is further evidenced by the fact that from 1900 to 1910 the world's commerce increased by less than 80 per cent, while colonial commerce more than doubled. The commerce of practically no sovereign power grew as rapidly as that of its colonies; and, due to the fact that all of the colonial possessions are as yet comparatively undeveloped, it is reasonable to assume that for many years to come the relative rate PHILIPPINE LOCAL AUTONOMY 101 of growth of commerce will continue very much in favor of the colonial possessions. It must not be forgotten, moreover, that the principal items of exports of colonies are foodstuffs and raw materials, both of which the great Temperate Zone powers must requirefirst, to sustain themselves; and, second, as the basis of their manufactures. There is bound to be a struggle by the great industrial nations for access to a supply of both of these. Hand in hand with this, there is bound to be a struggle for the markets of these colonies as an outlet for the manufactured products of the great industrial -nations. Looking into the future, is it not apparent, therefore, that there is coming a struggle for the commerce of these vast colonial domains between the powers which have and the powers which have not colonies, and is it not plain also that as discriminatory tariffs are imposed world peace is menaced or powers which have no colonies suffer fatal setbacks? No doubt the great European powers, which control 59 per cent of the tropical domains of the world and an even larger percentage of the colonial possessions of the world, had in mind, when the League of Nations was brought into existence, thereby to secure for themselves as nearly as possible undisputed possession of their vast domains. While all of the other great powers are struggling to secure colonies and, to secure greater commerce, are rapidly instituting preferential tariffs, we, on the other hand, with already only about two-thirds of 1 per cent of the tropical domains of the world among our colonial possessions are about to relinquish our sovereignty over by far the largest tropical area we possess. In other words, we are about to throw ourselves completely at the mercy of competing powers for a source of supply of many of our tropical food products and raw materials. To bring this home to us, let us take for example rubber. Practically 80 per cent of the crude rubber of the world is produced in domains over which European powers hold the sovereignty. We consume perhaps three-fourths of the crude rubber of the world. European powers might impose an export duty on rubber from their colonial possessions and what chance would we have in the markets of the world in competing with the sovereign power which has a preferential tariff with its rubber-producing colony? Outside of our domestic trade, overnight our rubber business would be annihilated, and even in our domestic business we would pay through the nose. This very thing almost happened when England two or three years ago placed an export duty on rubber from her far eastern colonies. It is true that export duty is not as yet discriminatory, but might overnight be made so with the above results. The Philippines have as favorable soil and climate for rubber production as that of the greatest rubber-producing districts of the world. Properly developed, those islands could supply us with all the rubber, sugar, hemp, vegetable oils, and indigo which we require over and above what we ourselves can produce. Thus we would not be so dependent for raw tropical products coming from colonial domains subject to the discriminatory tariff of other sovereign powers. As much as this might well be an advantage to the United States, it would be more advantageous to the Filipinos. Naturally the Philippines must look to the great industrial powers for a market for their raw products. Thus they will encounter more and more, 102 PHILIPPINE LOCAL AUTONOMY year by year, the disadvantage of facing in Europe and Japan a preferential tariff in favor of these same raw products coming from the tropical domains of those powers. Japan now gives Formosa and all of her tropical and semitropical islands a decided preferential advantage over the Philippines in sugar, tobacco, and vegetable oils. England, France, Italy, and other European powers do likewise with the raw products from their respective colonial possessions. While the United States would lose the advantage of free entry of her manufactured and farm products into the Philippines, on the other hand, the Philippines would lose the advantage of free entry of their raw tropical products into the markets of the United States. This would be an advantage to neither and a disadvantage to both. Perhaps the greater disadvantage would be to the Philippines, as their greatest difficulty will be to find a market for their raw products in competition with the raw products of other tropical domains, most of which will have the advantage of a preferential tariff in the markets of the sovereign powers. But let no one underestimate the possibilities of our export trade with the Philippines. If the purchases by the Philippines from the United States were the same per capita as the per capita purchases from the United States by Cuba, Porto Rico, and Hawaii, based on the purchases from the United States for the 12 months ending June 30, 1918, and on the Philippine population of 1918 of 10,350,640, they would be as follows: Cuba per capita purchases, $89.60. On this basis the Philippine purchases annually would be $927,417,344. Porto Rico per capita purchases were $47.31. On this basis the Philippine purchases would be $489,688,777. Hawaii per capita purchases were $195.17. Philippine purchases on this basis would be $2,020,134,000. Am sorry, due to lack of time, it was impossible to prepare these figures on the basis of the per capita purchases of Cuba. Porto Rico, and Hawaii in more recent years. The figures would have been even larger than those above given. By sheer accident and not by intent the Philippines in 1898 fell to us. We could not play the role almost of vandals by destroying the only government there was, leaving immediately, and abandoning to whatever their fate might be, an unprotected and pitifully impoverished people, with no experience vwhatsoever in government. We were not a voluntary Santa Claus; but a drafted Red Cross to the only Christian peoples of the Far East. We started to build up a self-governing nation on Western, not on oriental standards and ideals. We made an excellent beginning. But to bring these good people thus far along the road of progress on American educational, political, social and economic standards and then, just as they are started, leave them stranded and worse still wreck their economic structure by which all these high western standards are now supported, seems to me is playing them false and is a destructive rather than helpful act. It is not in accordance with what has hitherto been our policy and our practice. The vital importance of this can not be overestimated in determining your next step, and unfortunately it can not be fully understood except by those who know at first hand the history of the progress of the Filipino people since American occupation. 'We have planted the seed of a Western nation in an oriental setting, an example and goal to the other billions of souls in the Far East. Is there any mandate from the Amer PHILIPPINE LOCAL AUTONOMMY 103 ican people for the saving of $2,000,000 per year by complete withdrawal, to stunt by our own acts the flower we ourselves planted and cherished, that, after all, it become only an oriental flower? I would like to insert in the record two articles by William Howard Gardiner, nephew of Admiral Mahan, in connection with the naval question which I have discussed. The CHAIRMAN. With the consent of the committee that will be done. Mr. SCHAFER. I do not want to agree to insert anything in the record unless we can have something to qualify the man that wrote the articles as being capable and experienced, so that his statements would have weight. Mr. SWITZER. He is vice president of the Navy League of the United States, and he is also connected with another naval society. Mr. SCHAFER. May I interrupt, Mr. Chairman? Could the gentleman insert in the record this man's experience or anything that would show he was qualified as an expert to render an opinion on the matter which he writes about. Mr. SWITZER. He is vice president of the Navy League of the United States, secretary Naval Historical Society, member of the United States Institute, and authority on naval power in its relation to statecraft. (The papers referred to are here inserted:) THE PHILIPPINES AND SEA POWER [By William Howard Gardiner] The purpose here is to suggest, in the light of that phase of history recognized particularly by students of sea power, that the policy of the United States toward the Philippines is pregnant with possibilities for good or evil that transcend any immediate Filipino or American interests-that it is fraught with contingencies likely to have a determining effect upon such ultimate adjustment as may be wrought out between our civilization and that of the Orient. But in order to form an estimate of some of the external influences, that the Philippines may have on their immediate surroundings and on world affairs, we should have in mind at least some of the more important features of the historical background of the archipelago and of its surroundings. It should be remembered that from about A. D. 200 to 1405 the Philippines were an outpost dependency of successive Hindu-Malayan empires and that from 1405 to 1440 they were governed by China. Throughout these 12 centuries and more their many tribes had always been so antagonistic to each other than they never had been able to unite and strike back effectively at their successive overlords; nor had they been able to undertake any overseas adventures save as individual piratical marauders. By contrast to this primitive and disunited condition in the Philippines, it was as long ago as the second century of our era that the Japanese Empress Jingo invaded Korea. For a thousand years thereafter there were aggressions and counteraggressions between the mainland and the islands of Japan until Kublai Khan, grandson of the great Genghis Khan and founder of Pekin, made an elaborate effort in 1273 to conquer the Japanese, an effort that was frustrated by maritime disaster. From then on the native sea sense of the Japanese seem to have been quickened, for by 1440 they had secured dominion over northern Luzon, while the fierce Moros from the south, rather than the Filipinos proper, broke the hold of China on the rest of the Philippines. But after the Japanese had held northern Luzon for 125 years, they were driven out by the superior arms of the Spaniards, who arrived in force in 1565. Less than 30 years thereafter the great Shogun, Hideyoshi, so impressed the Spaniards with the overseas might of Japan that the Spaniards in the Philippines paid annual tribute to the Japanese from 1592 to 1623; and it 104 PHILIPPINE LOCAL AUTONOMY was this same Hildeyoshi who started the great Korean-Japanese war of 1592 in order to conquer China, overrunning Korea with 200,000 men and being defeated only when the remarkable Korean naval genius, Yi-sun, at last succeelded in cutting the Japanese lines of communication with their homeland. This brief outline of some of the major events of the earlier maritime history of the FaT' East 1as been given to mark how, from the earliest days of our era, the 'Piiippines hnave ever been disunited and, consequently, subject to others. xwhlile Japan, quite the contrary from always having been a hermit nation. his ai Record of brilliant overselas adlventure thalt reaches back intot the my thical diawn of her history. Korea land the Philippines were ld battle fields to the Jcapliese long before their IEmpire entered on its hlerlit period fromi 162:3 until 1.83. For the modern pictur oe lwe;ul1 recall that J.apxan,.after sle hhad equipped herself with modern wea)pons, resu'med hle overseas creer ree b er war of 1894 g inst China. Wh ile the t icple opjective Japan attained by this war wfas rlhe l break;ing 'f the protectorate tlht. (thina had exercised over Koea orea tmn centuries, incidentally Japan acqluirel Forimosa, a s'teippingstone to hier e:r!ier (doains in the Philippinell. Thlis led inturally to her taking l '1 keen interest in the ilnmediately- ensuinl. efforts of the Filipinos to throw off the lec (repit rule of Spain —and to equally bitter dlisappo:intment on the part -f thle.Ji;tianese wten tie I:iip)pinaes ptassed into tile stronrgerl anlds of tl.e lUnitedl Statets. Solmew0A:t as tle ii-Japanese war of 1894 had lbeen fought to free Korea from China, so the Russo-Japanese war of 1904 wais precipitated because Russia xwas menltcin Korea. Upon the outbrleak of this watr..Japan signed a protocol w tlh the Emperor of Korea which. amonolig other things. said: "A:T. 3. Tle Inmperial (Governiment of Japtan definitely guaantees the indep){end'n,'i e an:td ter'ito'oiial integrity of the Korean Empire." After JapIlan's victory over Russia,nd after a protectorate over Korea had led to the installation of a Japanese resident general there, the followinx g soca;tled treaty was forced on the Emperor of Korea in 1910; "ARTICLE 1. His Majesty the Emperor of Korea makes complete and permanent cession to His Majesty the Emperor of Japan of all rights of sovereignty over the whole of Korea. "ART. 2. His Majesty the Emperor of Japan accepts the cession mentioned in the preceding article and consents to the complete annexation of Korea to the Empire of Japan." It had taken Japan but five years to pass from guaranteeing the independence and territorial integrity of Korea to annexing Korea as a subject Province of the Japanese Empire. a transition worthy of notice by sincere advocates of Philippine independence. Great Britain entered the late war against Germany on August 4, 1914, and Japan followed i suit on the 23d of the same month. The very next day Count OkumaT i is si:i, to have sent the following cablegram to the United States. and the 1i'ii uini proptagandist, Professor Kalaw, quoted it as lately as 1919 to support his iargument that Japan lhas no imperialistic intention that might menace an in(ependent 1nt weak Philippine republic: "As premier of Japan I have stated and now again state to the people of Aericr' an'd of thle world that ap an has no ulterior motive, no desire to secure more territory. no 1,olgl-lt of depriving China or other people of anything they now posysess." Tlol'mi v-T " f 'xw wouvld 'to s-o f"ar as to co,)tend that Japan lhas adhered to this polic-y is shttmed by her premier, some nimantainn that throughout the war she did everything in her powver to support Great Britain and the Entente. On the other band, others point out that-witlhin five months of Count Okuma's above-quotied statement IJapan presented her notorious 21 demands to China. upon most of which she has been insisting ever since. They point out that, excepting for tardxy action against German raiders in the Pacific and except for convoying11 troops from Australasia, Japan did nothing of a belligerent nature dure ing the war except to lhe" o-wn advantaoe in the Far East, and this in spite of the fact that the Entente x-was in dire need of troops and that Japan kept an exceedingly large arm mobilized in the east during most of the war. The point of interest here is not her subsequent acquisition of all of the former German islands north of the Equator, nor her consolidation of her hold on Manchuria, nor her seeming attempt to remain in Shantung, nor her still Kalaw, Self-Government in the Philippines,, p. 166. PHILIPPINE I OCAL AUTONOMY 105 lingering in Siberia, but rather her failure to enter the war promptly alongside,of her ally, Great Britain, and her failure to support the Entente in force after she did go in and when the Allies were in dire need of troops. This delay has been explained in many highly informed quarters by the statement that Japan spent the first three weeks of the war in trying to exact a special price from Great Britain for the promise of Japanese cooperation in force-a delay of inestimable value to the German raiders and Pacific Squadron. And Japan's failure later to cooperate in force similarly has been explained as being due in part to her failure to get her price and in part to developments in Europe ensuing from this situation. For reports from Europe, Asia, and Australasia are to the effect that the Japanese asked of Great Britain the immediate and permanent cession to Japan of a string of local British possessions and naval-base facilities extending from the Indian Ocean through the Straits of Malacca and up the China coast, as well as a certain position ultimately in Europe which does not concern us here. It is not practicable to treat here in naval detail the results that might have been expected if Great Britain had acceded to the request attributed to Japan. To appreciate them in the merest outline it should be realized that a modern battle fleet has an effective operating radius of only about 2,000 miles from its base through waters likely to be infested by submarines, this-because of the necessity of maintaining the high speed essential as a protection against submarines, which entails burning rapidly its very limited fuel supplies. If Japan could have exacted from Britain's need of help in Europe this Honkong-Singapore-Ceylon chain of naval bases, it would have enabled Japan to mobilize her battle fleet even at Ceylon and would have given her the naval command of all sea communications from Kamchatka to India, incidentally cutting off British Australasia and the Dutch East Indies from their natural European lines of communication and support. And the transfer of these naval bases from Britain to Japan would have vitiated Britain's ability to express any great degree of naval power in the Far East, thus leaving the United States, with our rudimentary base in the Philippines, alone vis-a-vis Japan. If such prejudices as we may have do not make it impossible for us to admit the possibility of Japan's entertaining extensive designs of an imperialistic nature, then there is no need to elaborate the ultimate effects that this suggested transfer of naval bases might be expected to have on Dutch and British interests throughout the Far East and Australasia-effects that it is no guess to say have been considered carefully. On the other hand, with Great Britain in possession of a string of naval bases all less than 2,000 miles apart and culminating, say, at Hongkong, and if the United States had a similar line of adequate naval bases across the Pacific and culminating in the Philippines, such a condition would be like stretching a cordon sanitaire from Hongkong to San Francisco that would have debarred Japan from imperialistic expansion to the south of such a line-and this without in any way interfering with whatever peaceful commerce Japan or any other nation might develop to the south of such a line. While. on the matter of security in this region it should be. noted \that advocates of Philippine independence assert that the four-power treaty developed during the Washington conference makes the Philippines safe from external aggression. It should be realized, however, that that treaty applies only to the " insular possessions " of the participating powers and that if the Philippines were to be given independence they would cease to be an "insular possession" of the United States and, consequently, would no longer enjoy whatever security may emanate from the four-power treaty. The l1ongkong-Singapore-Ceylon situation we have been discussing, in addition to suggesting a southward Japanese policy, has particularly important bearings on interests of the United States. For, failing to obtain command of a naval route to the south via British bases, it has become all the more important to Japan to again secure either direct control over the Philippines or indirect control over them through their government. One reason -for *this is that a Japanese naval base in the Philippines would flank the British line of communication from Singapore up the China coast; and another reason is that it would give direct command over the extremely important oil fields of Dutch Borneo, as well as access to Australasia through the Celebes. Hence the contemplated British project of a great naval base in New Guinea-a matter of paramount importance to Australasia if the Philippines ceased to be under the control of the United States. 106 PHILIPPINE LOCAL AUTONOMY As well as the strategic situation suggested, there is a more immediate commercial situation which should be recognized. For just as the Japanese archipelago blankets most of the northern part of the Pacific coast of Asia. both strategically and commercially, so the Philippines blanket the southern part of that coast; and. furthermore, by the Philippines passes a great north and south trade which has no equivalent in the more northerly Japanese waters. The trade of Japan in 1920 with Siberia and northern China was only about 15 per cent of her total foreign trade, wThereas very nearly 47 per cent of Japan's foreign trade flows to the southward and passes within a few hundred miles of the Philippines. Consequently, if Japan could control the Philippines, directly or indirectly, she could not only blanket the southern Pacific coast of Asia as she does its northern section, but she could assure the safety of her threefold greater southward trade. For in time of war. if another power had an adequate naval base in the Philippines it could cut off virtually half of the total foreign trade of Japan-a trade upon which she is becoming more and more dependent as her transformation from an agricultural to an industrial nation progresses. In fact, it may not be too much to say that, by destroying both the southward and the American trade of Japan, she might be so reduced that she could not keep up a war. The situation just outlined gives particular point to article 19 of the naval treaty whereby the United States has agreed not to increase our inadequate and insecure naval base facilities in the Philippines. For it will be remembered that it was the Japanese who proposed article 19 at the Washington conference, and that they insisted on it as a sine qua non of their agreeing to the 5-5-3 capital fleet ratio that the United States proposed. This strategic situation, when viewed in its entirety and in conjunction with the Pan-Asiatic movement, would seem to make it very difficult for politico strategists not to recognize an intent on the part of Japan to crowd white influences out of the Far East and to consolidate Japanese dominance along that shore of the Pacific. And to minds which, through the habit of retrospecting in multiples of centuries, are given to prospecting at least in multiples of decades, the question naturally arises: What then as to the balance of the Pacific? Time and again the evolutionary process of civilization has shown that the proper function of force is to protect moral ideals against mere physical strength, however intelligently directed, until such time as moral ideals shall have borne such fruit throughout the world that physical aggression no longer will be contemplated. Stated in more specific present day terms, the civilization of western Europe, of which the United States is the greatest single outgrowth, is trying to give form and substance to a young and tender flowerthe substitution of equity for force among nations. Until the mortality of this shall have penetrated effectively throughout continental Europe and Asia. the culture of this ideal must be defended by force lest it be trodden under foot and fail of effective purpose in the warld for anotler cycle of centuries. In short, as far as one can see, the prospect is a struggle on the part of the civilization emanating from western Europe to preserve and dissemniiate its idealism while all the time it protects this idealism, by force if need le. from being blighted by the baclkward materialism of eastern Europe and Asia-and this for whatever period may be necessary to attain the universal substitution of equity for force. In the light of such considerations we should look on the question of independence for the Philippines not as merely an insular matter. It is a matter of the broadest bearing on the ultimate adjustment to be wrought out between our civilization and that of the Orient under the probable leadership of Japan. Sincere Filipinos should mark carefully the history of Korea since Japan. with seeming disinterestedness, went to war with China to free Korea from her ancient suzerain-in order, ultimately, to absorb Korea as a dependent Province of the Japanese Empire, a Province not self-governed by its own elective legislature as are the Philippines, but governed by a Japanese military governor general. And Americans should not be surprised if Japan most earnestly and intensely supports a movement ostensibly for the freedom of the Phillippines; for it is not unlikely that Japan appears as playing a part toward them similar to that which the United States played toward Cuba under Spain-with a different intent. Filipinos should realize that there is no real analogy between Cuba and the Philippines. Cuba geographically is under the very wing of the United States: and if any foreign power were to attempt her subjugation, the whole American PHILIPPINE LOCAL AUTONOMY 107 people would rush to the aid of Cuba —and to the defense of their own immediate security. But the Philippines are very remote and many Americans, sensing possible complications, in effect ask the question: How can we withdraw from the Philippines with a show of decency and let them fend for themselves, thus saving ourselves from far eastern embroilments? It is rarely that the man on the street has sufficient knowledge of strategy to realize that the ultimate security of the United States depends on the security of Australasia and on the stability of the Far East and that these, in turn, depend on the security of the Philippines. Filipinos should realize that the one and single thing that would cause the American people as a whole to come to their aid is the fact that the American flag floats over them, protecting them while their capacity for self-government is being developed. Remove the flag-as the independista would do-and the future of the Philippines will be a matter of practically no interest to the mass of Americans unconcerned with world affairs. But perhaps the most profound factor in the future of the Philippines is the test it may put upon the moral fiber of the American people. It is no sign of a strong sense of righteousness for a guardian to grant the demand of a wayward child that he permit it forthwith to have its own way in the world. A higher sense of duty is shown by willingness to make whatever efforts and sacrifices may be required to defend and develop a dependent, however wayward. And the cycle of civilization after civilization has shown that when a once great people become so selfish and ease loving that they lose their sense of duty to defend and foster their dependents, that is a sure index of moral turpitude which ends in their being overthrown as a nation by others who have not lost their virility. The policy of the American people toward the Philippines may indeed by the determining indext of the future of the Pacific and of our civilization. REALITIES IN THE FAR EAST [By William Howard Gardiner] I It is common knowledge now that informed and experienced officials in Europe had been extremely concerned for several years before the actual outbreak of war there in 1914 over what the general public had not recognized; namely, that the trend of affairs was making war imminent and virtually inevitable. In that instance it appeared as though some people were debarred entirely from making a correct estimate of the situation by their aversion to facing the distasteful conclusions to which known facts pointed, and by their adherence to prejudices-however idealistic-that did not rest on a comprehensive foundation of realities. While such people seem inevitably doomed to make misjudgments, the open minded are confronted by a further difficulty in attempting to make a sound estimate of an intricate international situation. This difficulty comes from the fact that adequate information, essential to any worth-while estimate, is hardly ever available outside of official circles; and that, even when comprehensive information on such matters is available, it is likely to be so complex and technical that sound interpretations from it -are to he expected only from extraordinarily able minds, or from those who can draw on a long background of vicarious and personal experience in the responsible interpretation of such data. It should cause no surprise, therefore, to those who have not been in close touch with comprehensively informed officials of experience in the Far East that these latter were extremely concerned during the summer of 1923 over the imminent portent of certain matters there of which comparatively little was known and even less was understood by the general public. During the preceding winter and spring there had been a marked developnlent of liberalism in the industrial centers of the Japanese Empire. The theorem that liberalism is anti-imperialistic and makes for international peace would have led some to conclude from this that the prospect for continued peace in the Far East had been improved by this growth of Japanese liberalism. But when it was discussed with many of the best informed and most experienced American, British, Dutch, and Chinese officials-whether in Pekina 108 PHILIPPINE LOCAL AUTONOMY Shanghai, Hongkong, Manila, Singapore, or Java-the virtually unanimous opinion was that it boded extremely ill for the peace of the Orient and, perhaps, of the world. Such a conclusion was reached by1 such pleople. first, because they had detailed information as to certain contemporaneous conditions and daring moves that will be outlined hereunder: and, second, because they could interpret this information in the light of a b)road understanding of certain long-enduring and major conflicts between policy anld practice, a realization of which would seem to be essential to seein- the recent drama and present prospect in the Far East in proper perspective. The American policy with respect to the Far East —w.itl whnich it has become usual to profess accord-looks to the maintenance of the sovereign independence and territorial integrity of China while providing, in principle, for equality of opportunity for all peoples in their economic activities throughout China. But those who view this policy with perspective recognize that it is counter to the practice of the ages. which has been that the stronger tribes or nations conquered and sequestrated tbe lands and resources of the weaker. The overthrowingl of the Aztec -and Inca civilizations, the conquests of the Indies, of Africa, and of Australasia and the continental development of wlat are now the United States and Canada are among the results of such warlike procedure by Europeans since the latter began their extensive adventures overseas little more than four centuries ago. The results of the opportunities won overseas 1by the British were consolidated by their monopoly of their interimperial trade through the nravigation acts, which were repealed only in 18 54, after 200 years of operation under them had given the Britisli suclh an in(cmpialible "going concern" in intercommunications by sea as to promise tenm conltinuance of virtual rmoopoly. And now that new condit-ions trhreaten suci control, a plan to strengthen, it by a system of interimaperial prefelrence ttriffs wals agreed to at tie recent ilperi:il conference itt Ln don. One aias merei- to visit.v-i -and to lwte lhow lusilless is cllducted there to appreciate how stronl- the Dutch adhere to the (loctrine of trade monopoly. It is the same throughout the.0)010,00 } and more squlare miles the French lhave conquered during the tast 50 years. And at the present time a dispute is reported between Sweden tnd Denmark because te tle ltter insists on monolpolizing Greenland's trade. One of the early breaches in this immemorial systenm of conquest for monopoly was- made by Commlodore Kearney, of the United States Navy. when the British were acquiring special conlcessions from Chini at the close of the opium war in 1842, and he secured assurances from the Chinese that Americans would be treated as favorably as *any other nationals, after lwhich the British sovereign said to Parliament: Throughout the whole course of my negotiations with the Government of China I have uniformly disclaimed the wish for any exclusive advantages. It has been my desire that equal favor should be shown to the industry and commercial enterprise of all nations." Though the British had sequestrated Chinese territory for their own uses. Caleb Cushing. in negotiating the subsequent treaty of Wang Hiya, in 1844. disclaimed any such purpose and insisted merely on the United States being' granted commercial opportuiities equivalent to those conceded to any other power. Thus was born the open-door doctrine, that looks to equality of economic opportunity for all without any sequestration of territory or abatement of severeign integrity-a doctrine, be it understood, that would leave every nation free to set up whatever import or export tariffs, or other trade regulaions, it may choose, provided that these apply to its commerce with all other nations without discrimination. The United States secured professions of accord with the open-door doctrine from the principal European powers and the Japanese Empire in 1900; and these professions, though frequently forgotten, were strengthened by the still unratified nine-power treaty of Washington in 1922. But the recent record of realities in the Far East shows how fundamental and irreconcilable is the conflict there between the policy of equal opportunity for all without sequestration and the persistent practice of sequestration in order to gain exclusive, or at least preferential opportunity. PHILIPPINE LOCAL AUTONOMY 109 III The indubitable record is that the Japanese Empire has risen to its present status, in the main, through its three decennial wars of 1894, 1904, and 1914, whereby it first completed its hold on the insular barrier to Northestern Asia, from Kamchatka to Formosa, and then began its expansion on to the continent by taking the Liaotung Peninsula from Russia, and by absorbing the ancient realm of Korea-whose independence and territorial integrity it had solemnly guaranteed less than six years before absorbing it. Just before the Japanese Empire attempted to monopolize Fukien, Shantung, Manchuria, and Inner Mongolia, and to turn China virtually into a vassal state by the 21 demands of 1915, the Japanese premier, Count Okuma, is reported to have said: "Those who are superior will govern those who are inferior. I believe that within two or three centuries the world will have a few great governing countries and others will be governed by them, will pay homage to the mighty. In other words, about four or five great countries * * * will be developed, and the other countries will be attached to these great ones. For instance, England, Russia, Germany, and France may be such countries. We [Japanese] should from now on prepare ourselves to become a governing nation." As Count Okuma was guiding the policy of the Japanese Empire at the time he made this statement, it would seem reasonable to consider it as an- authoritative index of the outlook and purpose of the Japanese Government less than 10 years ago. It has been said, however, that the recent Japanese withdrawal from Shantung was because of a general rectification of policy-induced by diplomatic pressure at the Washington conference. But in informed circles in the Far East it is known that the boycott the Chinese maintained in many provinces against the trade of the Jlapanese, so long as the latter held the sacred province of Shantung, was costing the Japanese far more than they could afford or could expect to make out of Shantung alone. So they withdrew front it in order to regain their trade elsewhere; andhighly important with Orientals-" saved face" by alleging that their withdrawal was because of a change of heart, induced by what the public has been led to believe was the altruistic atmosphere of the Washington conference. Similarly, the withdrawal of the Japanese from their protracted excursion in Siberia has been advanced as another evidence of voluntary abandonment of their practice of extending their sphere of exclusive control over territory belonging to others. But again the best informed people in the Far East point to the fact that this excursion, through it yielded little, cost the Japanese Government over a billion yen, and that it was seen that a continuance of such a great drain on the treasury would be a less effective expenditure at the moment than to increase the classes of naval auxiliary vessels unlimited by the Washington conference. The case of northern Saghalien is not cited as showing that the Japanese have embarked upon a policy of restitution of the territories they have seized from others; for they are still firmly entrenched there. But it would not be surprising to have them trade it back to Russia, as it is more than rumored that they have been bitterly disappointed in their expectations of finding there a good supply of fuel oil for their navy. Nor is the case of Manchuria cited as a reversal of their practice of securing control of the territories of their neighbors; for the Japanese have repelled, with a great show of indignation, the Chinese suggestion of last year that they vacate Manchuria; and, as is well known in the Far East, they are in active process of consolidating their control over it with the aid of its ex-bandit chief, Chang Tso-lin. In short, the record shows that, since professing accord with the opendoor doctrine in 1900, the Japanese have not hesitated to sequestrate the:territories and to monopolize the resources of their neighbors in accordance with the militant tenets of Prussian imperialism-except when the direct or indirect costs of so doing have proved to be unwarrantably heavy. In considering this record, however, we should recognize frankly that such practices were in accord with those common throughout most parts of the world from time immemorial until very recently, and that such practices have not. yet been banished from regions other than the Far East. Furthermore, we should recognize that it has been principally by such traditional and common practices that the Japanese Empire has been raised 110 PHILIPPINE LOCAL AUTONOMY from relative insignificance in the world of only 30 years ago to its present stature. Though the reverse of ideal, such methods have been proven preeminently practical and profitable to the Japanese. So the Japanese should not be expected to abandon them lightly. IV Comprehensive appreciation of the Japanese record, of which it has been possible here only to refer to some of the more salient incidents, gave particular point to the very tense situation that was under the sunny surface of the Orient during the summer of 1923-a situation that, providentially, was relieved, for the moment, by the appalling Japanese earthquake of the 1st of September. As has been suggested above, in the winter of 1923 there was such a marked development of liberalism in Japanese industrial centers that it threatened to get beyond the control even of the Japanese police. Being thus seized with what has been aptly described as an acute attack of "internal indigestion," the Japanese Government naturally sought the corrective of "external exercise." That is, it sought to create a seemly opportunity for external activity of a promising nature, upon which the attention of the patriotic Japanese public could be focused to the neglect of liberalism-and in order that, in the heat of foreign warlike measures, irreconcilable liberals might be dealt with conclusively by measures more drastic than could be used in times of peace. In view of the factional strife in China and the disorganization and virtual impotence of the Government at Peking, the simplest procedure would have been to fling some sort of ultimatum, such as the 21 demands of 1915, before that distraught body, and launch an expeditionary force to carry it out. But memories of how the Chinese boycott over the occupation of Shantung had turned much Japanese trade with China into British and American channels indicated how vast would be the indirect costs of such a procedure. And besides, such crude methods would have belied the rectified role the Japanese Empire desires the world to believe it has adopted since having been promoted to the exalted position of one of the four principal powers in the League of Nations by the "big four " at the Paris peace conference. But if, on the other hand, a situation could be developed in which the United States and the principal European powers would take the initiative in insisting on an international intervention in force in China. then the occasion would be ideal-from the Japanese point of view. To proposals for such an intervention the Japanese could object at first, thereby establishing the record not only that the original suggestion for intervention did not come from them, but that, in the interest of peace, they were opposed to intervention. Yet, if the Americans and Europeans should continue to insist on an international intervention, then, against its officially stated inclinations, it would become incumbent upon the Japanese Empire, as a principal power, claiming paramount local interests, regretfully to contribute a contingent to the international force aimed at intervention in China. Such a situation would have been substantially similar to the international intervention inaugurated in 1918 in Siberia, to which the Japanese were supposed to send not over 7,000 troops but to which they insisted on sending far more than all the other contingents combined, and a commanding officer who outranked all others present and who, consequently, took supreme command. If such a situation had arisen in China, it would have amounted, de facto, to a Japanese intervention, but one brought about by American and European initiative and against the officially recorded protests of the Japanese athorities. So the responsibility and stigma would have been upon us and not upon the Japanese. Yet such an intervention, in which the Japanese surely would have had preponderant forces and the supreme command, could have been developed to serve as the external exercise required to correct the attack of internal indigestion from which the Japanese realm was suffering as a result of liberalism; and such a move would have been especially effective internally if it could have been made through Shantung-to withdrawal from which many Japanese have never been reconciled. But the initially essential item of an adequate reason why the United States and the European powers should intervene in force in China was lacking. It will be recalled that early in May a large body of Chinese brigands derailed and held up the Blue Express from Shanghai to Peking near Lin PHILIPPINE LOCAL AUTONOMY 111 Cheng, taking from it a score of prominent Americans and Europeans, some of whom were held in captivity about a month. And it may be recalled also that, a few days after this outrage occurred, the American and the British vchambers of commerce in Shanghai-with more energy than insight-severally petitioned the American Department of State and the British foreign office to intervene in force and to rescue our captive nationals-or their remains. It was of very great interest to the present writer, on arriving in China early in July, to learn from several authorative sources-Americans who had made it their particular business to find out-that the Lin-Cheng train banditry had been organized by agents of a certain eminent Chinese, opposed to the Government at Peking; and that he had organized it on behalf of the Japanese with whom he is associated in other matters. The plan, of which almost all vital details had been uncovered by July, had been double in its purpose. Politically, it aimed to create such a situation lhat the United States and the European Powers would insist on intervention in force. Thereupon, after objecting pro forma, the Japanese would have joined in preponderant force and the resulting invasion of China-upon our excited initiative-would have given the Japanese the "external exercise" they deemed necessary to correct the "internal indigestion" that liberalism was causing at home; and this without their seeming to have been responsible for having brought it all about. "For strategic reasons" it was planned that the Japanese contingent was to have entered through Shantung, putting that province firmly back in Japanese hands-but on our initiative. There was more, however, to the strategic purpose of the plan than that, for by throwing a Japanese force "against the brigands" north of Kiansu, Anhwei, and Honan Provinces, military support essential to the Peking Government from those Provinces would have been cut off. And thereupon Chang Tso-lin's forces in Manchuria would have become preponderant and he could have moved confidently against the Chinese capital with what, beyond doubt, would have been exceedingly serious consequences to China. It was a cleverly conceived plan that promised to satisfy the particular aims of its several oriental participants. But it was inadequately inaugurated, for we did not rise to the bait and intervene. Also, it was inadequately guarded, for we uncovered it. And meanwhile the pains the Japanese authorities were suffering, due to liberalism in their body politic, instead of being relieved were growing more acute. V A careful investigation, made during May and June in the Japanese industrial centers, revealed that the Japanese liberals were so elated over the spread of their doctrines that they were planning a great demonstration, to occur about the 1st of November, which they hoped would develop into an open revolt against some phases of the Imperial Government. In July we had for consideration, therefore, the following known items: During the previous winter a comparatively moderate outbreak of liberalism had so disturbed the Japanese authorities that they had gone to the length of inciting the Lin-Cheng banditry outrage so as to create, under the guise of an international intervention, an opportunity for external activity that would enable them to correct their internal ills. The plan had failed to develop. But liberalism had continued to grow-even to the extreme of planning a re, volt for the late autumn. It seemed impossible to avoid the conclusion that, before November, and in order to head off the revolt the liberals were known to be planning, the Japanese authorities would make some external demarche more daring, if need be, than the Lin-Cheng episode. Indeed that was the conclusion usually reached when, during July and August, this situation was discussed all along the coast down to Java, with some of the people most experienced in estimating such matters; and several emphasized particularly their belief that while a Japanese excursion onto the continent before November seemed inevitable, yet such a move would be counter to the policy the Japanese Government seems to wish to follow at present, and would be made only because the Japanese authorities were being driven to it in order to retain control over conditions at home. 101692-24 -8 112 PHILIPPINE LOCAL AUTONOMY Here it should be realized-as it was realized especially in responsible American circles in the Far East-that if the Japanese had made such a warlike move as seemed to be impending last summer, their action would have presented the United States with a very serious problem and with a unique responsibility. The antagonisms of the European powers among themselves in Europe, 'and their commitments in the Near East, in Africa, and in the Middle East were such as virtually to immobilize their forces in those regions and to prevent their playing a part of any considerable effect in the Far Eeast. Consequently, on the United States would have fallen virtually the undivided responsibility of deciding whether merely to file a paper protest and practically to acquiesce by inaction to whatever the Japanese might set out to do —or to endeavor to halt them 1by a threat of force if need be. But we knew, and presumably the Japanese knew, that such a threat would have been quite empty. For the rigid economy that we-who least of the great powers need do so-have been practicing in our naval expenditures has so impaired the efficiency and capacity of our navy as to make it, for the moment, totally incapable of acting effectively in such a situation in time to stop its materialization. In other words, we have deprived ourselves of the force that would be necessary to maintain peace and equity. It so happened that the broader bearings and possible developments of this entire situation were discussed at great length on the afternoon of the 1st of September with a particularly well informed group of men. At that very moment. however, the great earthquake had just occurred and Tokyo and Yokohamal were in fllames-which, as was said after the appalling news came, " solved the situation for the moment, but only for the moment." It may be recalled that the Japanese authorities issued a statement, soon after the earthquake, in which it was alleged that the pillaging that naturally ensued was being done by Koreans previously employed as laborers in the devastated region; that these Koreans had started many of the fires that sprang up naturally among most of the demolished houses immediately after the earthquake: and that they, together with radicals, were organizing an attempt on the Imperial Government. To this 'ppeal Japanese of all classes responded instantly and virtually to a man. For it focused the patriotism of the public against an alien, and recently subjugated, race now alleged to be attempting to take a quite understandable revenge in the hour of Japanese calamity. According to boasts heard from Japanese-before they realized the unwisdom of such boasts-about 1,500 unfortunate Koreans, as well as some Japanese radicals, were slaughtered out of hand by the Japanese soldiers, police, and populace. Thus the appalling earthquake disaster was very cleverly used by the Japanese authorities to create a racially external issue in order to get their own internal situation in hand by directing public emotion against lowly aliens defenseless in their midst. One would think that the internal effects of the earthquake, on the one hand, and the fact that the Chinese were among the very first to rush aid to the Japanese, on the other, would have ended Japanese activities in and against China for awhile. Word comes, however, that even since the earthquake the Japanese, indirectly, have been urging that an international police control over the Chinese railroads is essential to public safety-because of bandits, forsooth! But they are avoiding any appearance of initiating this suggestion, and it is understood that they would refuse at first to join in any international police plan, thus proving their aversion to such a move by the powers. Nevertheless, if the powers actually were to inaugurate such a police control over the Chinese railroads, there can be no doubt but what Japanese interests would call for Japanese participation in it, and Japanese facilities on the spot would result in the international control being dominated by the Japanese. So the net result of this move that the Japanese are trying to bring about by indirect means would be the control of the Chinese railroads by the Japanese authorities. This move since the earthquake reveals an attempt to obtain by indirect means, through the powers, some of the ends more openly sought, but not attained, by the 21 demands of 1915. But more, perhaps, than anything else, it shows that, while the appalling earthquake disaster solved the very tense situation in the Orient for the moment, it solved it only for the moment, because it has not diverted the Japanese from their purposes and practices. PHILIPPINE LOCAL AUTONOMY 113 VI While the matters just outlined were of immediate moment last summer, they also threw light on a broader subject that was discussed in every center from Peking to Java, a subject of much greater ultimate meaning in international grand strategy. As is well known, within the Japanese bureaucracy two quite different plans have been contending for preference. What might be called the Japanese territorialist plan is sponsored by the Chosu clan that predominates in the army. Naturally this is reminiscent of Prussian thought in its desire to spread direct military, political, and economic control progressively over adjacent parts of the Continent of Asia as extensively as possible so that the Japanese of the future may live, in the main, on their economic exploitation of China and of the Chinese. The development of such a plan, of which we have witnessed the first stages, with its conquests of territories, its overthrowing of governments, and-its political and economic enslavement of peoples, is so noisy and obvious as to arouse extensive interest. But its scope ashore is limited by the ability to extend and the capacity to maintain police control by means of overland communications; it is likely to be very costly in more ways than can be anticipated, as both the Germans and the Japanese have discovered, and, in itself, it is not as likely to have as world-wide effects of great importance as would a procedure involving extensive maritime operations. In contrast to this territorialist plan is what might be called the Japanese maritime plan that is supported by the naval S'atzuma clan. This springs from an appreciation of Mahan's doctrines to the effect that the ability to conduct extensive communications by sea one's self, the power to deny adequate communications by sea to one's opponent has been a most potent and far-reaching factor in the history of peoples. and this because such control over communications by sea gives preferential access to overseas lands and to their human and material resources, while enabling one to minimize such access to one's opponent in peace and virtually to deny it to him in war. Meintion was made above of the fact that the Japanese Empire "first completed its hold on the insular barrier to northeastern Asia from Kamchatka to Formosa." More specifically, in one way or another, the Japanese have acquired during the last 50 years the Loochoo Islands, the Kurile Islands, the Bonin Islands, Saghalien, Formosa, the Pescadores, the Mariana Islands (except Guam), the Pellew Islands, the Caroline Islands, and the Marshall Islands. The result is that now, apart from the Aleutian Islands, the Hawaiian Islands. the Philippines, northern Borneo, -a few small and scattered American or British islands, and the coastal islands, all the islands of the Pacific north of the Equator are in the hands of the Japanese. One effect of this is that submarines or airplanes based on islands remote from Japan proper could seriously impede the advance of an enemy force toward Japanese home waters. Another is that the control of the entire insular barrier to northeastern Asia makes it possible for the Japanese Navy to isolate that region from direct overseas communication and to deny commercial access to it from the sea except by a naval force based near enough effectively to break through the barrier and to hold open the breach made. So when some talk easily of throwing this or that force into China, say, against brigands, it does not seem that they have given due consideration to the control the Japanese might exercise over such operations because of their naval control over the northern part of the insular barrier that lays across the lines of communication to northern China and Siberia. It was interesting to find that such effects of the control the Japanese Empire already has over the islands of the North Pacific and over the northern part of the great insular barrier that extends virtually down to New Zealand and into the Indian Ocean are realized as a matter of course among those in the Far East who are conversant with the elements of internationl grand strategy and with its far eastern factors. But it was far more interesting to find that the American, the British, and Dutch circles there concerned with such matters had each arrived separately at further deductions that are so similar to each other as to vary only in minute details. The substance of all of these three sets of deductions is that the purpose of the Japanese maritime plan is to extend Japanese control progressively along 114 PHILIPPINE LOCAL AUTONOMY the insular barrier (1)hwu to its southern terminal and around to the Indian Ocean-. And it was interesting to find how certain recent Japanese activities in the American Philippines, in British Malaya, and in the Netherlands East Indies have confirmed these deductions. It was as though three people had been given a formula from which each separately had plotted a similar projection of a curve, and that, on top of their projections checking each other, supplemental data had come to hand from.three separate sources, which data had confirmed all three projections. A glance at the map should suffice to show that the retention of the Philippines by the United States is the present outstanding obstacle to the Japanese extending progressively their control along the insular barrier. But if Filipino politicians were free merely to grant to the Japanese a certain naval-base site in the southern Philippines-as there are reasons for believing some would be glad to do-then the remainder of the task ahead of the Japanese would be easy in comparison to its present difficulties. And this for the simple yet all important reason that the United States, should we so desire, could focus adequate force to stop the Japanese at the Philippines; whereas the British. for politico-naval reasons that are too complex to be outlined here, could not focus adequate force at Singapore to stop the Japanese there if the latter were based on the Philippines and had a secure line of support to such a base. The conclusion from this situation is that, in deciding on the future of the Philippines. we are likely to be deciding on the future of the Netherlands East Ildies a.nd of Australasia —to say nothing of the future of India, of Malaya, of China, and of all for which our civilization may stand in the Orient. In short, the American. the British, and the Dutch circles concerned with matters of international grand strategy in the Far East recognize explicitly that the guard of the United States mounts at the Philippines is essential to the security of Australasia and to whatever measure of peace may be maintained " east of Suez." ()n the other hand, it is recognized in such circles as beyond question that. if the Japanese could secure merely an appropriate naval-base site in an " Independent republic of the Philippines," they would be able to isolate eastern Asia from commercial or political or military relations with or support from either Europe or America. Consequently, the Japanese could set aside that vast region as their own economic preserve, without the troube of having to police it, by securing merely control over the sea lines of communication to it, in accordance with only a partial development of the more extensive maritime plan that the naval 'Satzuma clan are known to be urging; and by so doing they would reap the 1)ulk of the benefits while avoiding all the turmoil and costs necessarily incildenlt to the territorialist plan of the army Chosu clan for the progressive coi ( i test of eastern Asia. 'roin this it should be obvious why, on the one hand, the Japanese are not pusihin forward into continental Asia as extensively as they might while, on the other hand, they are doing everything in their power, indirectly, to bring aboi:7t Phiilippine independence. VII Tile foregoing outliine of some of the more important realities that confront reslponsible people in the Far East may suggest a possible reason why the fore 'g' policy of the United States, during most of 1923, seemed to avoid with partictular care any trans-Atlantic undertaking that might impair our capacity to act as we might think best in any trans-Pacific crisis. Indeed. color is g'ive'L to sllch a sur'nise by our Secretary of State having suggested, in Decemher of 1922, that we participate in an attempt to solve the problem of German reparations; but that thereafter, so far as is known, the matter was allowed to rest until over a month after the Japanese earthquake-by which time it ihad become clear in the United States that that horrible cataclysm had relieved the tense situation of last summer in the Far East for the moment. But the principal purpose of giving here this outline of far-eastern matters has been to bring out the way in which the persistent practices and apparent purposes of the Japanese Empire are diametrically opposed to the comparatively New World policy for which the United States stands; namely, equality of ol)portunity for all without sequestration. Equality of opportunity without sequestration is, and must remain, irreconcilable with sequestration designed to gain preferential or exclusive oppor PHILIPPINE LOCAL AUTONOMY 115 tuity. This irreconcilability between the policy of the United States and the practices of the Japanese Empire would be sufficient cause in itself for the known attitude of distrust and antagonism that Japanese authorities maintain toward the United States under a surface of official amenities. But there is more to this situation than a clash between policy and practice. On our side, we are becoming more and more dependent on selling overseas our surplus products in order to maintain and advance our standard of living. And since 1900 our trans-Pacific trade has increased over a hundredfold: so that now it is nearly a quarter of our total overseas trade, although, as yet, wve have little more than sampled the trans-Pacific market. On the side of the Japanese, we should recognize that their sequestrational and monopolistic practices have been vastly profitable to them, and have been in general accord with the traditional procedure followed from time immemorial by virtually all needy peoples capable of so doing. Their apparent purpose to build a great maritime empire that would enfold eastern Asia and would command the Pacific holds out to them a brilliant promise of making secure their future as one of the very greatest powers the world has seen. It is merely an intelligent application to the geography and other circumstances in Asia and of the Pacific of those procedures whereby capable peoples, throughout the ages, have built empires for themselves —witness the evolution of the British Empire in the last three and a quarter centuries only, or the conquest by the third French Republic of over 5,000,000 square milespof new territory since 1875, although, before that date, less than half a millionr square miles in all were under the French flag. The Japanese see for themselves, as the reward of astute persistence, a future empire that shall enfold eastern Asia and command the Pacific-if they can parry interference from the United States and from Russia when that drugged giant shall have returned to potency. But we, on the other hand, see that such a future Japanese Empire would debar us from Asia and could menace our future security. In this antagonism between interests, between Japanese practice and American policy, there is, however, much more than a material issue. For there is at stake a possible step for us to take toward the effective substitution of equity for force. It would be interesting to speculate as to how much less war ridden the past would have been had our comparatively recent open-door doctrine of equality of opportunity for all without sequestration been propounded and put into general practice centuries ago by others. It is far more important, however, to recognize the very great extent to which real adherence to this doctrine by all powers, from now on, would tend to remove one of the great incentives to wars in the future. Beyond question the greatest obstacle to real adherence by all to the doctrine of equality of opportunity without sequestration is that some powersnot to say most-believe that their own interests will be better served if they seek to sequestrate and to monopolize such opportunities as may come within their reach. As Thayer pointed out in his Life of John Hay, some have been shamed into professions to the contrary. But precept and example have failed to deter them from such practices. More specifically, the evident intention of the Japanese Empire to continue practices that have proved so vastly profitable and are so very promising would seem to confront us with the necessity of choosing between the following courses: We should be prepared to offer the Japanese, in convincing terms, a prospect even more profitable than their vision of empire if they wvill abandon their practices and really adhere to our policy instead of merely professing to do so. Or we should be prepared-also in convincing terms-to make their continuance of their practices unprofitable to them. Or, regardless of our own ultimate interests, we should abandon our halfhearted attempt by our policy to substitute equality of opportunity, equity, and peace for the immemorial procedure of war, sequestration, and subjugation for gain. It does not appear possible to offer the Japanese convincing prospects of greater profit than they see for themselves through persisting in their usual practices. But it would be possible to make it imminently unprofitable to them to continue their practices of sequestration and monopoly; and this in terms that would carry conviction to them: namely, a navy capable of supporting our policy and our interests in the Far East-a navy within 116 PHILIPPIXE LOCAL AUTONOMY the naval limitation treaty in every specified respect and fully up t;o the "treaty ratios" in every essential respect. In short, realities in the Far East seem to confront us with the necessity of choosing between the maintenance of a force adequate to stop flagrant and dangerous inequity there, or our abandonment of our attempt to substitute equity for force. Mr. KNUTSON. Ml'. Sweitzer, you speak of giving the Filipinos home rule? Mr. SWEITZER. Yes, sir. Mr. KNUTSON. You are in favor of giving thle Filipinos homle rule at this time? Mr. SWEITZER. Yes. sir. Mr. KNUTSON. Which would constitute a probationary period of self-government, to prepare them for ultimate independence, and during this period, they are to be assisted by America. Would you please tell the committee to what extent you would deem America's assistance necessary during this probationary period, to what extent you would be in favor of giving them home rule? Mr. SWEITZER. I would be in favor of giving them home rule as per the Fairfield bill, because I think practically undivided responsibility-and to-day it is divided-will sober them down and make for more harmonious relations. They will learn by responsibility. We. have lead them by the hand thus far. Let them walk practically alone, and later on they can walk entirely alone if they so wish it. Mr. KNUTTSO. To the extent that Canada is now walking alone? Mr. SWEITZER. I should say this bill is practically that. Mr. KNUTSON. The nere fact that there is a severe econonic depression in the islands at the present time, does not constitute, in your opinion, prima facie evidence of the Filipinos' inability to govern themselves? Mr. SWEITZER. NO. Mr. KNUTSON. You have brought that out. Mr. SWEITZER. That is a world condition. Mr. KNUTSOX. I was going to say that that does not obtain only in the Philippine world. Why should it be necessary for the Philippine Islands to maintain any military establishment in the event of their being given their independence in excess of that which they novw iha1e in the form of a constabulary. Mr. SWITZER. If there were no American troops there of any kind. I tl in they would unquestionably have to have mnore than their present constalblary for their own internal purposes to say nothing of external purposes. Mr. KNETSON. How many officers and privates have they in the constabulary at the present ti'me? Mr. SwITZER. I do not remember exactly how many there are, but there are a comparatively small number. You see the scouts are in the United States Army. Mr. KNUJTSOX. That is the reason I am referring to the constabularv. Mr. SwITZER. The Philippines do not pay for the scouts. The United States pays for those. Mr. KNUTSON. You maintain that the Philippines are not a menace to the future peace of this country? PHILIPPINE LOCAL AUTONOMY 117 Mr. SWITZER. I maintain that they. are a security to the United States, and when it becomes a security to the United States we are killing two birds with one stone; we are protecting the Filipino people as well. Mr. KNUTSON. You have read what Theodore Roosevelt had to say with regard to the Philippines being a source of weakness and danger to us? Mr. SWITZER. Mr. Roosevelt was a versatile man, but if I were sick, I would not go to him as a doctor. If I wanted to know something about naval and military strategy, I would not go to him. Mr. KNUTSON. He was a statesman. Mr. SWITZER. I will admit that. Mr. KNUTSON. One of the requisites of statesmanship is to be able to visualize not only the present but the future. Mr. SWITZER. Yes, sir; but military and naval strategy require more than vision; they require expert knowledge and training. Mr. KNUTSON. He must be able to visualize not only the present but the future conditions and relationships between the nations. Mr. SWITZER. Yes, sir; I will not deny that is so. Mr. KNUTSON. You rather have an apprehension that Japan would go into the Philippines, if we went out of it? Mr. SWITZER. Yes; and I like the Philippine people too much to contemplate the possibility of such a calamity. Mr. KNUrSON. Why has not Japan gone into Borneo, Java, and Siam? Mr. SWITZER. Well, she would hate to contend with Holland. Mr. KNUTSON. She is 10,000 miles away — Mr. SWITzER. That may be true, but nevertheless you overlook the fact that Japan would not be so interested in having a territory or naval base down in the Dutch East Indies without a continuous line of naval bases from Japan down. That line would be broken. That base down there would be completely isolated. She wants bases in a continuous line. She does not want that line broken. Am I making myself clear? Mr. KNUTSON. Yes, sir; very clear. What nations have extended continuous lines?. Mr. SWITZER. Japan has extended, until to-day she has everything from Kamchatka to the Philippines? Mr. KNUTSON. That is a restricted area? Mr. SWITZER. No; how many miles do you think it is? Mr. KNUTSON. I was speaking from the world's standpoint. Mr. SWITZER. I will admit that. Mr. KNUTSON. It is like saying we have continuous control from Maine to Florida; something like that. Mr. SWITZER. That is our own country. Mr. KNUTSON. That is Japan's own country. Mr. SWITZER. It is quite different, because with Saghalien, Japan itself, Korea, and Formosa, in one continuous barrier, Japan has China sewed up from Kamchatka down to the Philippines. Mr. KNUTSON. The one point you speak of is the necessity of retaining the Philippines from a military standpoint. Would not the same condition obtain 30 years hence? Would it not be just as necessary, if the Philippines are necessary to our security to-day 118 PHILIPPINE LOCAL AUTONOMY would not they be necessary a few years hence, 50 years hence, 100 or 1,000 years hence? Mr. SWITZER. I think perhaps that is true. Mr. KNUTSON. If that be true, then there is no use in talking about Philippine independence, and all the promises that have been made them have just been empty phrases. Mr. SWITZER. No: I do not agree with you there at all. They would not be empty phrases. Mr. KNUTSON. Would not your fears be allayed if we retained a naval and military base in the Philippines, and if we retained supervision over their finances, such as we now have in the Dominican Republic and Haiti. Nicaragua, and Honduras. Mr. SWITZER. No: and besides you are just proposing a Fairfield bill in a minor degree. Mr. KNUTSON. I am speaking now from the standpoint of immediate independence with those reservations. Mr. SWITZER. Yes; but that would not be independence. Mr. KNUTSON. It would not. Mr. SWITZER. No; I should not think so, if you are going to control their finances, and this, that, and the other thing. Mr. KNUTSON. Haiti is independent; San Domingo just recently elected a President. They maintain diplomatic relations. Mr. SWITZER. Yes; they have a certain kind of independence. Mr. KNUTSON. The Philippines are willing to give certain safeguards and guaranties to this Government. Mr. SWITZER. They have a certain kind of independence. Mr. KNUTSON (continuing). Through providing naval and military bases and coaling stations. You speak of the fact that this country only controls a very small portion of the Tropics. Mr. SWITZER. Yes. Mr. KNUTSON. What is it, 2 per cent? Mr. SWITZER. No; two-thirds of 1 per cent. Mr. KNUTSON. Two-thirds of 1 per cent. Mr. SWITZER. Yes, sir. Mr. KNUTSON. Thirty years from now that same condition would obtain, would it not? Mr. SWITZER. Possibly. Mr. KNUTSON. Would it be just as desirable 30 years hence to maintain the Philippines from an economic standpoint in order to insure continuous and a certain supply of raw material, such as rubber and other tropical products, 30 years from now as it is true now? Mr. SWITZER. Yes, sir; probably. The CHAIRMAN. I think what Mr. Switzer was showing was that there were some compensations. The attitude has been that there were no compensations in this manner, there were no values to the. United States by way of relationship, and Mr. Switzer was showing there was some compensating advantages, and therefore that argument would fail. Mr. KNUTSON. I do not think the chairman just gets my angle. Would it not be just as desirable, and would it not be just as hard for the Philippines to get its independence 30 years hence as now? Mr. SWITZER. No; absolutely not. PHILIPPINE LOCAL AUTONOMY 119 Mr. KNUTSON. Would not the necessity for a continuing and certain supply of raw material from the Tropics be as great 30 years from now as it is now? Mr. SwrrzER. Yes, sir; but would we not have given our word in a bill like this if they wanted independence 30 years from now to let them have it? Is not our word good Mr. KNUrsON. If we are not going to give them independence, I think the time is here to tell them so. Mr. SWITZER. I think so. Mr. KNUTSON. In unmistakable language. Mr. SWITZER. I think we ought to tell them so; and I am supporting this bill because I think it does tell them so. The CHAIRMAN. I just want to say the bill fully expresses my conviction of the moral obligation that we are under to grant ultimate independence to the Philippines, but I have put in the further proviso that if at the end of a certain period they decided to remain with us, they desired to remain with us, that it is granting a fundamental right which was never involved in any promise that has heretofore been made. It is simply the granting of an additional right to the Filipinos, the possibility of remaining in if they desire to do so. Mr. BEEDY. I would like to ask a question, which was suggested by Mr. Knutson. Mr. Switzer, if a bill which declares for immediate, comparatively immediate, independence should contain a provision for the retention of a naval base for this country, should provide also for a sinking fund for the payments of bonds, should constitute bond payments a lien on Philippine revenues, and should provide that we negotiate treaties with China, Japan, France, England, Germany, Holland, and other nations interested in colonial possessions, by which the independent sovereignty of the Philippines and their neutrality would be respected, would not that in a great measure remove the objections which you have advanced here? Mr. SWITZER. Absolutely, in a great measure. Mr. BEEDY. In other words, such a bill with proper safeguards might not unwisely be drawn and presented. Mr. SWITZER. Yes; if it were not for the extraordinary conditions, economic and otherwise, which I tried to make clear to-day, with those provisos you have mentioned, I would say yes. Mr. BEEDY. There remains the difficulty of raising taxes to, carry on their government, that would follow diminished trade, deprivation of American markets, and the loss of the existing exemption from our tariffs. Mr. HUDSON. You would not consider that independence based on those premises should become effective until such treaties were executed, would you, to safeguard them, the treaties with the foreign countries? Mr. SWITZER. As specified by Mr. Beedy? Mr. HUDSON. Yes. If such a proposition as he suggests is contingent upon the treaties with these foreign countries named being executed by our country, there would be no independence 'till such treaties could be executed, could there? Mr. SWITZER. No, sir. Mr. HUDSON. Well, any one country refusing to do that might hold up the independence of the Philippines for a longer period than the Fairfield bill provides. 120 PHILIPPINE LOCAL AUTONOMY Mfr. SWITZER. You are quite right. Mr. HUDSON. So you are going out into an unknown sea of diplomacy? Mr. SWITZER. I realize that thoroughly, and I have not any idea that you will put that suggestion in the bill. Mr. HuDsoN. It is in one bill before now. Mr. SWITZER. Yes: I think it is. It would make the granting of their independence indefinite, and for that reason only I am inclined to think it is bad to put it in there, but you have got to weigh the advantages of absolutely insuring the integrity of that country by such an international contract on the one hand and the disadvantage of really not being clear in a definite arrangement for independence on the otller, and if the Filipinos objected to such a clause as that in the bill, I would say leave it out absolutely. Mr. BEEDY. Neither vou or Mr. Hudson want to leave the impression with the committee that you.think it would take more than 30 years to find out whether we could negotiate the treaties referred to? Mr. SWITZER. I do not think it would. Mr. BEEDY. We could determine that in two or three years. Mr. SWITZER. I think so; I hope so. If you could not, it would be prima facie evidence that there was a nimer in the woodpile somewhere. Mr. BEEDY. At least it would give the opportunity to the United States of showing the world that it was ready to do the square thing, and if some other nation wanted to block Philippine independence that would be their responsibility and not ours. Mr. HUDSON. If this would make an indefinite period on which neither the Filipinos nor the United States could go on in the scheme of development until such things were settled. Mr. SWITZER. Let me make myself clear, that if the Filipino leaders objected to such a proviso as the international contract, I would say leave it out, because, so far as I am concerned, I want it to be made definite that these people may have their independence at a fixed date if they want it and not have any more questions about it. Mr. HUDSON. That is the appeal to me of the Fairfield bill, of the absolute definiteness in here. Mr. SAaLMON. I wanted to ask a question: Under the relation of the United States Government with these other powers mentioned, do you think it would be a good policy or incumbent on us for us to ask Japan, China, or any other power first, whether or not we ought to give the Philippines their independence by asking for a treaty in advance of granting their independence? Mr. SWITZER. Well, that would come up 30 years from now. Mr. SALMON. I am talking about immediate independence. Mr. SWITZERn. I would hate to talk about immediate independence now. Mr. KxNUTSON. We are talking about mlananio, not to-day. Mr. SALMON. I am talking about what we ought to do now. The point I am getting at is whether or not it would be good policy for this committee to convey the idea that we would be dependent upon any of these powers or their action in granting the Philippines the independence we have heretofore promised them. PHILIPPINE LOCAL AUTONOMY 121 Mr. SWITZER. If I were the United States and had full say about it, I would not ask them anything about it, and I would see to it that nobody monkeyed with the Philippines. Mr. BEEDY. There is no provision in the bill, in any of the bills before this committee, the purpose of which is to get the consent of any other nation as to what we want to do'with the Philippines, but it is a manifesto on our part that we will not release them to be the prey of other nations, unless they want to agree with us to protect their sovereignty. Mr. SCHAFER. If some of the questions I asked and some of the conditions I refer to are incorrect, I would like the witness to correct me. The testimony has been somewhat voluminous, and I am out of practice in taking shorthand, and I perhaps may have erred. I understood you to say you wanted to give the people of the Philippines a self-government during the period of this plebiscite. Was I correct in that? Mr. SWITZER. I do not get your question. I do not know if it will answer your question or not, but I mean during the period between now and 30 years from now, when they decide what they want to do by a plebiscite, that they should have home rule. Mr. SCHAFER. SO that they can have greater powers of government? Mr. SWITZER. That is right. Mr. SCHAFER. DO you think that the Fairfield bill, 8856, if enacted into law, will extend that home rule as you desire? Mr. SWITZER. It seems to me it gives them practically complete home rule, and the only thing the United States has to do in case it thinks they have made a serious mistake, or are about to make a serious mistake, it can correct or guide them, but outside of that they run their own affairs. Mr. SCHAFER. Now I would like to refer to section 9 of the proposed bill and ask the consent of the committee to incorporate section 9 in my remarks. After carefully reading section 9 and noting the power granted to the United States Commissioner, which would be created under that section, and to the President, I think that by enacting this bill 8856, with section 9 incorporated, that we would be taking powers from them, in fact placing wholly unwarranted powers and authority in the hands of that commissioner and the President. Mr. BEEDY. I would like to make a point of order. I think we should abandon expression of our viewpoints and confine ourselves to questioning the witness. The CHAIRMAN. Will you not, Mr. Schafer, propound your questions to the witness? Mr. SCHAFER. I will have to make a statement as I interpret the statement you have made. You stated, as I understand, that American business firms which now operate in the Philippine Islands are now in a precarious financial condition. Mr. SWITZER. No; I said that a large number of tobacco and sugar enterprises in the isands were in a very precarious condition. Mr. SCHAFER. In a financial condition? Mr. SwrrzEi. Yes; a financial condition, which is true, and not necessarily American firms. Several of those are Philippine firms. 122 PHILIPPINE LOCAL AUTONOMY Mr. SCHAFER. Could you insert in the record the names of some of those concerns? Mr. SWITZER. I would say it would be rather indelicate for me to do. Mr. SCHAFER. You made a statement as to the American troops quartered in the Philippines. I would infer that you stated that the Philippine people would lose the business if those troops were removed, that may happen now by reason of expenditures for equipment, etc., of those troops. Mr. SWITZER. That is right. Mr. SCHAFER. Does the American Government purchase equipment for the troops in the Philippine Islands? Mr. SWITZER. It does not purchase clothing or things like that, but many things are required by the troops that can be obtained there in the islands. Mr. SCHAFER. You made a remark as to the limit of the number of acres that corporations could hold, 2,500 for a corporation, and a limit on the number of acres of land an individual could own. 247 acres. Mr. SWITZER. Yes, sir. Mr. SCHAFER. Do you think that is an unwise limitation? Mr. SWITZER. Well, I think perhaps it was not an unwise limitatian under the circumstances. I have no objection to it at all, in fact I am glad there can be no charge made that we have exploited that country. Mr. SCHAFER. Being familiar with the Philippine situation, do you know of any attempts, recent attempts, to have that limitation increased in the islands? Mr. SWITZER. I believe there were efforts made to increase it, when certain rubber companies thought of going over there. Mr. SCHAFER. The Firestone Tire & Rubber Co.? Mr. SWITZER. I do not remember what company it was, but it is quite natural that they should want a larger area because they must operate on rather a large scale in order to be able to produce economically. They are a long ways from home, must send out a good man in charge of it, pay him a good salary, and naturally they must operate on a correspondingly large scale. Mr. SCHAFER. You made a statement that outside of American capital invested in the Philippine bonds, there was approximately $100,000,000 of other capital invested. Mr. SwiTrER. That is right. Mr. SCHAFER. I would like to insert in the rceord a document furnished me by the Bureau of Foreign and Domestic Commerce, and I want to ask the gentleman upon what facts he bases his statement that outside of the money invested in the Philippine bonds, that there is $100,000,000 of American money invested? Mr. SwrrzEm About half a dozen of us sat down in New York, men who know the Philippines quite well, and made up a list of companies out there, companies and individuals. Mr. SCHAFER. Did you use the amount that they actually invested, or did you take itMr. SWITzmR. Exactly as near as we could, to estimate the investment. PHILIPPINE LOCAL AUTONOMY 123 Mr. RAGON. I presume this concludes Mr. Switzer's testimony, does it not The CHAIRMAN. I suppose so. Mr. RoxAS. The representatives of the Philippine people would like to express their views on this bill, if the committee would let them, either now or at the next meeting. (Informal discussion). The CHAIMAN. The committee will adjourn until Monday, May 5. 1924, at 10 o'clock a. m. Am?,erican, investmients in Philippine Islands [Compiled by finance and investment division, February 8, 1924] 1914 1923 Philippine government bonds -------------------------- ----- $12,000,000 $70,000,000 Philippine municipal bonds --------------------------------- _.6,125, 000 10,000,000 Manila Railroad bonds -—. --- —----------------------- 12,000,000 15,500, 000 Philippine Railway Co. bonds — ------------------------- 8,500,000 9,000,000 Sugar, hemp, tobacco, copra, etc ---e --- —-------------------- 16,000,000 25,000,000 Merchandising concerns -----— 3. --- —--------------- 3,000,000 5,000,000 Miscellaneous ------------------------— 6, --- —--—........ 6,000,000 10, 000, 000 Total --- —------ --------------------------------- 6 0 63, 725, 000 144, 500, 000 COMMITTEE ON INSULAR AFFAIRS, HOUSE OF REPRESENTATIVES, Monday, May 5, 1924. The committee this day met, Hon. Louis W. Fairfield (chairman) presiding. The CHAIRMAN. Gentlemen of the committee, you will please come to order. WTe have present with us this morning a group of ladies, who are attending the Peace Convention in Washington. A request has come to me that a representative of those ladies be permitted to speak for 10 minutes. I, of course, understand that the regular order was the hearing of the commissioners, but if the committee is willing to' listen, we will be glad to hear her. Mr. WILLIAMS. I will make a motion that she be allowed to speak for 10 minutes. (The committee unanimously agreed to allow Mrs. Park to speak for 10 minutes.) STATEMENT OF MRS. ELLIS PARK, OF CALIFORNIA Mrs. PARK. Before I say anything about Philippine independence, I will say it will be good news to you that I will not speak for 10 minutes. I think all we wish to add to this meeting is a statement that there are some of us who are very much interested and very much convinced that the Philippines should have their independence, and I am speaking in the name of the committee which we call the American Women's Committee for Philippine Independence. I wish to present this manifesto which we have drawn up, which contains signatures from all over this country. 124 PHIIIPPINE LOCAL AUTONOMY It seems to me that if all the American women needed to indorse this nlmoement knew all about it, and, of course, I realize that the American women do not know a great deal about it, because we are dependent upon press for information, and our press sees very well to it that we get the official pronunciamentos of the powers that govern the Philippines, instead of the wishes of the Philippines. When I have been speaking to women in our Congress they have expressed a great desire to learn something from the Philipine point of view, and we need enlightenment. The bureau has given out splendid publicity, but it is not now giving it out in this country. I will read the manifesto as we have stated it, and it really implies all that you would wish us to indorse. Believing that the United States is usurping power andl violating the fundamental principles of democracy and its solemn pledges by refusing to fulfill promises t~o the Philippines. we (emand the immediate edite withdrawal,of the United States from the Philippines. That seems to me so obvious that it does not need expansion. We do mean to stand by cur solemn pledges, and I am sure the women in the peace movement are very interested that the Filipinos have their independence. and that the United States should save its good name by keeping a solemn pledge. However. in comingt here and speaking at all, I assure vou, that all the Americanl women need enlightment. I am very much interested in the movement of the colored races for freedolm, th!e N~egror races in this country, and I often wish that the literat.ure that the Negro people print could be circulated more among the white people, and without any implication of color. I wish the Philippine literature would be circulated more among the American people, so that they might be thoroughly informed. Mr. RAGOxN. I presume the hearing is open now. A matter was brought uip by some of the committee with reference to writing the Attorney General about his opinion on the constitutionality or the right of Congress to grant the Philippine independence. The chairman showed me a letter. That letter has not been put in the record, hbut I think it should be. The CHAMIR:MAN. That has already been inserted in the record. Mr. IAGON. I do not know if the members heard that letter read. It should be read to them. I would like to have the chairman read the letter. The CHA.I-RMA-. At this point I will read the letter. Mr. BEEDY. Will you not postpone that and have it read in execu- tire session? Mr. EAGO-,. This is a matter of testimony that we want to get in in an orderly way, but since it is in the record we will save time by having it read again in executive session. The CHAIRlANs. I read the letter the other day, but you had left, Mr. E:CaIon. It is a very clear, explicit statement, that in the judgment of the Department of Justice we have full power to act. Now, gentlemen, in accordance with the purpose for which we adjourned to meet to-day, we will hear the members of the special commission, who have just arrived, and I understand that Mr. Quezon is to speak first. PHILIPPINE LOCAL AUTONOMY 125 STATEMENT OF HON. MANUEL L. QUEZON, PRESIDENT OF THE PHILIPPINE SENATE Mr. QUEZON. Mr. Chairman and gentlemen of the committee, I feel that I am appearing before you under the very best auspices. The few kind words of welcome with which the chairman received us are, indeed, very encouraging and the wonderful presentation of the Philippine cause made by the lady who has just preceded me has, I think, made some impression upon the committee. The influence of women in this country is great and I hope will be decisive to bring about the independence of the Philippine Islands. Mr. Chairman, I shall be very brief this morning. This committee, as well as the Senate Committee on Territories and Insular Possessions, has had, as I understand, occasion to hear from our able and patriotic representatives here-Speaker Manuel Roxas and Commissioners Gabaldon and Guevara-the facts regarding the present situation in the Philippines, so, unless questioned by members of the committee, I shall not go into details. I shall address myself merely to the purpose of our visit and this in as brief a manner as possible, in view of our desire that these hearings may now close, so that the committee may proceed to take some definite action. Senator Osmefia, Representative Recto, and myself have been sent here by the Philippine Legislature in order to lay before the Congress of the United States once more the petition of our people that they be granted immediate and complete independence. Senator Osmefia and I belong to the same party which constitutes the majority party in the legislature. Representative Recto is the minority leader in the lower house. In this mission, then, the only two political parties in the Philippine Islands are represented. But we are not only speaking for our respective political parties nor even for the legislature alone. We speak for the people of the Philippine Islands, because the question of Philippine independence is not a partisan or merely political question in the Philippines; it is a national and vital question, one in whose proper and prompt solution not only those actively engaged in politics are deeply interested but everybody else-business men, farmers, laborers, men in the professions, and others. Our stand in this question has been repeatedly presented to the American people and Government. It has been the same from the first days of the American occupation to this day. We want to be allowed to set up an independent government which will permit the working out of our national life as, in our opinion, will best secure our happiness, liberty, and prosperity. We feel that the granting of Philippine independence has been too long delayed, and we sincerely trust that this country may cover itself with glory by enacting a legislation which will free the Philippine Islands-a noble culmination of the splendid work jointly undertaken by the American Nation and the Filipino people. We know of no measure that can be enacted by this Congress whose beneficial results to mankind will be as enduring and far-reaching as this one. You would prove yourselves once more loyal to your history, your traditions, and the principles upon which this Republic was founded, and you would thereby promote the cause of peace, of freedom, and of good will among nations. 126 PHILIPPINE LOCAL AUTONOMY We shall not, Mr. Chairman, indulge in any abstract discussion of the right of the Filipino people to have independence now. There is one aspect of this question which deserves special consideration and ought to be, in our opinion, all-sufficient to move Congress to act. By the enactment of the Jones law in 1916, which, in its preamble, states that it is the purpose of the United States to grant the Philippines their independence as soon as a stable government can be established therein, and by the acceptance by the Filipino people of the terms of this act, a solemn covenant was entered into between the people of the United States on the one hand and the Filipino people on the other, whereby we bound ourselves to carry out the provisions of that act and bring about a situation that would make possible the establishment of a stable government, while you bound yourselves to grant us independence as soon as this condition came into existence in the islands. We have faithfully complied with the terms and provisions of this act. We organized a government in accordance with its terms; we elected the legislature provided therein, a legislature which has now been functioning for seven years; and not only can we establish a stable government but such government is already established and is in operation there. We have therefore fully performed our part of the covenant, and we feel that it is high time for you to do your part. It is beside the point to argue whether or not it would be advantageous economically or otherwise to grant the Philippines independence. The one single issue is whether or not we have a stable government in the Philippines, or a stable government can be established therein. If so, as we most emphatically assert and have time and again demonstrated, it is our belief that your plighted word gives you no alternative but the granting of independence. We rest our case right here, unless you desire to ask me some questions, which I will be only too glad to answer. Mr. HUDSON. Have you had an opportunity since your arrival to give any consideration to House Resolution 8856-the Fairfield bill? Mr. QUEZON. Is it the one you have before you now? Mr. HUDSON. Yes, sir. Mr. QUEZON. Yes, sir; I have read it. The CHAIRMAN. You have finished with your general statement? Mr. QUEZON. Yes, sir. Mr. BRUMM. Apropos to this question by Mr. Hudson, has that modified your opinion at all? Mr. QUEZON. In what respect? Mr. BRUMM. If you have read this new bill, the Fairfield bill, has it had any effect at all upon changing your attitude or opinion as to immeediate independence Mr. QUEZON. I do not believe that I quite understand the question. Of course, my opinion could not be changed by that bill. I still maintain that we should be granted immediate independence; therefore, if you mean to ask me if I prefer the Fairfield bill to an immediate independence bill I would say '" no," but if you want to ask me what I think of the Fairfield bill, I would say that in the first place the time set for the granting of independence is too long, to put it mildly. Mr. BRUaMM. What I meant was taking all the facts into consideration, this would have to be reported out of this committee, passed by the House, the Senate, and signed by the President: and, taking PRiEJIPPINE LOGAL AUxTOM;WY 7 everything into consideration, if this bill were, passed would that have any effect at ial on your persistenceito mse that- word, iti asking for immediate independence? Do you catch what I Tnean? Mr. QUEZON. I said " no," already. This country ought to know by this time that what we want is immediate and absolute inedepndetce. Of course, the Fairfield bill, so far as the powers of the new govera-. ment that it proposes to establish are concermed is ana iaiprwoveme4b upon the present government of the Philippines.. Mr. HUDSON. Iff Mr. Brumm is through, may I ask a question. The CHAIRM AN. Yes. Mr. HUDSON. You say, of course, Senator, that what you want is immediate and complete independence, but that the Fairfield bill, if that is your position, is a bill of some credit, What particular asdvantage do you apprehend, outside possibly of the satisfaction of in ambition, the Philippine people would have if immediate indepeldence were given, over the Fairfield bill, would give them autonomry, complete, of government --- Mr. QUEZON. What is your question? Mr. HUDSON. What would be the particular advantage of immediate independence and severance of the Filipinos over the Fairfield bill, which does give complete independence of legislative mattersa. Mr. QUrEZON. I do not quite understand. Mr. HUDSON. In what channels, outside of the channel that you would become a nation among nations, but what outside of that? Mr. QUEZON. That in itself is so great, Mr. Chairman, that I think it answers the question, but leaving that aside the Fairfield bill, as I see it, does not give full autonomy. Mr. HUDsoN. It does not give full autonomy? Mr. QUEzoN. No, sir. The Fairfield bill provides that there shall be a Resident Commissioner in the Philippine Islands, who will have the power to suspend any law enacted by the legislature which may impair the payment of bonds, etc. It provides also that this Resident Commissioner Mr. HUDSON. You have said all the while that yoU would not want any independence that would not do that. Mr. QUEzoN.,How is that,? Mr. HtDsoN. You have repeatedly testified before this committee, the people here representing you, that you would not want any independence that would not do that. Mr. QUEZON. Well, to satisfy the holders of Philippine bonds we do not object to any provision that would insure, to their satisfaction, the payment of interests and capital when due; but such provision limiting, as it must of necessity limi$, our legislative powers, would be a curtailment of our autonomy. So that the Fairfield bill imposes limitations and does not grant full autonomy. Mr. HUDSON. But under the Cooper measure, as amended, there would be the same limitations. Mr. QUEZON. I am not making comparisons, I ami simply stating — Mr. HUDsoN. Under your argument the Cooper amendment would be fully as objectionable as this. Mr. QUEZON. Well, I am not discussing the Coope b1ill. I am answering your question, when yoo aAk me what is the difference 101692-24 9.: - 128 PHUTJIPPINE LOCAL AUTONOMY between an independent government and the government provided for in the Fairfield bill. An independent government is a government which can do as it pleases regarding its own affairs, provided it does not interfere with the rights of other nations. Mr. HU:DSON. I was trying to get the difference between your conception of immediate independence now, as purposed lnder the Cooper independence bill, and this bill, but now if I understand it, there is no difference, because both of them have limitations. Mr. QUEZON. I have not seen the Cooper bill as amended. So I do not know what limitations, if any, are imposed. I am trying to point out the restrictions imposed upon the Filipino people by the Fairfield bill. There is another provision of this kind. You reserve to Congress the right to annul any and all of our laws. What kind of an autonomy is that? Mr. HUDSON. Is that statement quite true? Does the Fairfield bill give us the right to annul the laws? Mr. QUEZON. Yes, sir; I can point out the section of the bill. Mr. HUDSON. On certain things it is true. Mr. QUEZON. I will call your attention to page 4, line 12, which says that all acts passed by the Philippine Legislature shall be reported to the Congress of the United States, which reserves to itself the right to annul said laws. Of course, I do not think that Congress would ever exercise that power. Congress has repeatedly refused to amend or annul our laws even when it was requested to do so. by the administration in the Philippine Islands. If it is true that Congress would not annul our laws, why insert that provision which on its face destroys the autonomy granted by the'bill? Mr. HUIDSON. Do you realize that those sovereign States within this group of States can not pass any legislation contrary to Federal law? That is a limited power. Mr. QUEZON. Precisely because we could not pass laws contrary to Federal laws applicable to the Philippine Islands, it can not be said, strictly speaking, that the Fairfield bill grants complete autonomy and, therefore, our powers under that bill are limited. Of course, if we passed any law transcending the powers granted us the courts would declare it unconstitutional. Mr. BEEDY. If Mr. Hudson is through, Senator, you understand, perhaps, you did not put it in' the record clearly, that this provision on page 4 of the Fairfield bill, beginning with the line 12 and ending with line 15, is a privision which, if this bill becomes a law, compels your people to put it in your constitution. Mr. QUEZON. Yes; I know. Mr. BEEDY. You do not mean to leave the impression here that if you were granted your independence, and this provision were not there, our courts would have a right to pass on the constitutionality of any law you might pass? Mr. QUEZON. If we had independence? Mr. BEEDY. Yes, sir. Mr. QUEZON. Your courts would have nothing to do with us. Mr. BEEDY. Absolutely nothing. You would not stand in the relation to our courts that a State now stands, which was the implication which Mr. Hudson leaves. Mr. QUEZON. No; but the Fairfield bill, as I understand, does not consider the Philippines an independent nation. PHILIPPINE LOCAL AUTONOMY 129 Mr. BEEDY. You began to discuss what the situation would be if you were independent. Calling attention to page 7, and a provision beginning with line 16, which reads as follows: The United States Commissioner, pending the receipt of a decision by the President in the premises, shall have authority to suspend the effect of the operation of any law, etc. In respect to a question of Mr. Hudson, you said there is the same provision in the Cooper bill. Where, do you find any clause in the Cooper bill that is as broad as that in its curtailment of your powers? Mr. QUEZON. That was said by Mr. Hudson. Mr. BEEDY. Do you agree with that statement? Mr. QUEZON. I have not read the Cooper bill as amended by the subcommittee. I have been trying to get a copy of it. I know the Cooper bill, in its original form, and, as I understand it, it provides for the, calling of a constitutional convention to frame a constitution for the Philippines, and after that has been called and after the constitution shall have been approved by the people and the officers elected, the independence of the Philippines shall be recognized. Mr. BEEDY. It has been intimated to me more than once that your leaders are coming here and demanding independence immediately because of political pressure at home, which makes it incumbent upon you to do so, but that as a matter of fact, you would fear the consequences of immediate independence, not only in an economic way, but in a political way, and that you would be delighted, having apparently met the demands of your people, to have us postpone the date of your independence.. Do you yourself know anything about that? Mr. QIEZON. Mr. Chairman, the best proof of the pudding is in the eating. If you should enact a bill providing for immediate independence, you would find out whether our leaders wanted immediate independence or not. Mr. BEEDY. I would like you to answer my question. Mr. MACLAFFERTY. That is a fair question. Mr. QUEZON. Of course, we want immediate independence, and it is not true that we come here only for political expediency. But granted that it is true that the political leaders do not want immediate independence, but that they are advocating it simply because they are afraid of their constituency, I want to ask, is not this fact the best proof that the people of the Philippine Islands want independence when the leaders have to advocate it even against their wish? After all it is not what the politicians think or say that ought to govern in a democracy. It is what the people want. If the leaders did not want independence but they felt that the people wanted it to the extent that they, the leaders, are compelled to fight for independence, then I think you should give the people what they want. Mr. BEEDY. And you believe your people want independence today, and you want it, do you'. Mr. QUEZON. Yes, sir. The CHAIRMAN. Now, Mr. Quezon, not questioning the statement at all which you have made, and with no desire to question it, may I 130 PHILIPPINE LOCAL AUTONOMY ask if you consider the terms of the bill now before the committee, House bill 8856, as a definite advance over the Jones law? Mr. QUEZON. Without any question, it is an advance in so far as the autonomy it grants is concerned. The CHAIRMAN. In your judgment, it would be in line with the process by which gradually the United States had granted a further measure of autonomy to your people. Mr. QUEZON. Without any question, Mr. Chairman. The CHAIRMAN. Perhaps it will be proper for me to say here that having studied most carefully the evolution through which your government has passed, by a series of Federal acts, it was my thought in introducing a bill to make a definite step forward. Mr. QUEZON. It is a step forward. The CHAIRMAN. Having no thought to in any way restrict the activity of your government, so far as your domestic affairs are concerned, do you consider that the Fairfield bill would give to the Philippine people complete control of all their natural resources? Mr. QUEZON. Yes: because the power to legislate on all these questions is vested in the Philippine Legislature. The CHAIRMAN. Therefore the Fairfield bill, if enacted into law, would conserve every natural resource of the Philippine Islands and prevent exploitation by other people unless with the consent of the Philippine Legislature? Mr. QUEZON. Exactly so. The CHAIRMAN. Of course, I want to say frankly to you that I could not support any legislation that would turn your natural resources over to the exploitation of any people on earth, not even the people of the United States. Now, just one other question: Granting that the bill, if passed, becomes a law, with the specific promise of a plebiscite at the end of 30 years, is that not fixing a definite status for your people at the present time? Mr. QUEZON. It fixes the date of independence. The CHAIRMAN. May I state, personally, I have felt that a definite status is due your people. I think a definite status is due you. This bill has been drawn with the idea of a progressive movement toward independence, which you so covet, and very properly you covet it; but, on the other hand, Mr. Senator, do you know of any measure that has ever been introduced in this Congress before that granted the Philippine people the right to remain with the United States in case they should so desire? Mr. QUEZON. No; not that I know of. I am not sure, however, whether any bill of that kind has ever been introduced before. The CHAIRtMAN. I can understand you would not have in mind all the legislation that has been before our Congress. Mr. QUEZON. No. The CHAIRMAN. So far as I know, never in any bill has that been proposed: nor has there been any consideration given to the idea that possibly, under matured development and with longer time in the exercise of autonomy, they might want to remain with the Republic. Is that not after all the granting of a distinct and definite right which your people hitherto have never had? Mr. QUEZON. Yes. PHILIPPINE LOCAL ATJTONOMY 131 The CHAIRMAN. Of course whether that shall be considered as a valuable right or not, is another question, I admit. Mr. QUEZON. Mr. Chariman, I should like to call your attention to the fact that in our opinion the promise of independence contained in the Jones Act is just as definite as the provision in the Fairfield bill. The CHAIRMAN. I quite agree with you. Mr. QUEZON. The difference being that in the Fairfield bill the number of years after which independence is to be granted is fixed, while in the Jones Act a condition prior to granting of independence is set. And as far as we are concerned, there is no doubt as to the meaning of the words, " a stable government." We do not have to give these words " stable government," used in the preamble of the Jones law, a meaning all our own, for in state papers of the United States time and again the words " stable government" have been used with a distinct and clear meaning to define not an abstract idea but a government supported by the electorate and capable of protecting rights, lives, and liberty. The CHAIRMAN. Now, Mr. Quezon, was there a stable government-this is for clearing up the matter-was there a stable government, in your judgment, at the time of the passing of the Jones Act in the Philippine Islands? Mr. QUEZON. Yes; an American Government, an American stable Government. The CHAIRMAN. An American stable Government. Mr. QUEZON. Yes; sir. The CHAIRMAN. And under the Jones Act, you have not even as large a measure of autonomy as this provides for in the Fairfield bill? Mr. QTEZON. Doubtless, sir. The CHAIRMAN. Now, then, there is a stable government in the Philippine Islands to-day. Mr. QUEZON. Yes; sir. The CHAIRMAN. However, may it not be a question as to who has contributed most to the stability of that government? You have never had an opportunity, even in your domestic legislature thus far, to demonstrate that you could maintain a stable government. Is that not true? Mr. QUEZON. As far as the legislature goes we have: but not with respect to the executive, but that is not our fault. The CHAIRMAN. Not your fault. You are right. Mr. QUEZON. You did not give us the executive in the Jones law, but only the legislature, so that when you imposed upon us the condition that we should demonstrate that a stable government can be established it should be understood as far as we could do it with the means you placed in our hands. The CHAIRMAN. We have not given you a chance. Mr. QUEZON. You said you wanted us to show that we can establish a stable government. To do this you only gave us a legislature; therefore, if we can prove to you that the legislature has done its part for the establishment of a stable government, we have complied with the condition. The CHAIRMAN. I agree with you. That is the reason why you should be granted complete autonomy, so far as your domestic affairs are concerned, to give you opportunity to demonstrate, and I 132 PHILIPPINE LOCAL AUTONOMY have no doubt that you would demonstrate your ability to do so, that this bill would give you the first chance you have had thus far to complete control to your domestic affairs. Mr. QUEZON. Mr. Fairfield, I hope you do not feel that you have to convince me that we should be given at least complete autonomy. Mr. FAIRFIELD. What I am trying to get: before the committee is, I think, you might agree with me, that this is a definite advance, that it will give an opportunity for the exercise of legislative power and government, such as you have never known before. Mr. QUEZON. Oh, yes, sir. The CHAIRMAN. And which we have confidence enough to believe that in the end, at least 30 years, you will be prepared thoroughly for every problem of domestic and foreign administration. Mr. QUEZON. Everything is fine in what you said, except that 30 years is too long. The CHAIRMAN. Well, it might not be so long. Mr. MACLAFFERTY. Mr. Senator, I would like to ask you this: Of course you recognize that it is not within the power of this committee to give you anything; that is, to guarantee the action of Congress. Mr. QUEZON. I know that. Mr. MACLAFFERTY. Would you rather have a bill-in fact, the Fairfield bill-enacted into law now than for this committee to report out a bill which gave you immediate independence, and a bill which is almost certain would not be passed by Congress, and if passed by Congress would not be signed by the President? Would you rather go back home from this place with the Fairfield bill a law, or would you rather go back home with no bill at all? Mr. QUEZON. I would rather go back home with some law that will improve conditions there. Mr. MACLAFFERTY. Mr. Senator, some people, I think, misunderstand my attitude in this matter. I am for Philippine independence as much as any man at this table, and have always been. I live on the Pacific coast. I live in Oakland. Calif. I know more or less about the Philippines. I have never been there, but I know people who come and go, who have an interest in the Philippines, and I know people who have gone over there without any financial interest and worked there a little while. I have a good many brothers in the Philippine Islands. Mr. QUEZON. I am one of them. Mr. MACLAFFERTY. I know you are. I want to say I want to see the Philippine Islands set up an independent government at the earliest possible moment, and I believe that a bill such as the Fairfield bill can pass Congress and become a law and establish a definite status, and then I believe that you would see at once the change of conditions in the Philippine Islands, and while 30 years seems a long time, it is not a long time in the scheme of things, and I firmly believe that at the end of 30 years, knowing that the Philippine people would have the right at that time not only to demand their independence but to have it-I believe that by that time they will be capable of maintaining the government with all the responsibilities outside their realm, which, to my mind, are greater responsibilities than those within their realm. PHILIPPINE LOCAL AUTONOMY 133 Mr. QUEZON. I think I have plainly stated our position. If you can not get the Cooper bill, as originally presented, or any other similar bill, enacted into law, and you can pass some other measure that would give us complete home rule, even the Fairfield bill, with some amendments, I say, to use slang, go to it. Mr. KENT. But you want us to cut down the number of years. Mr. QUEZON. That, of course, because in 30 years I may never live to see it. Mr. MACLAFFERTY. If the Cooper bill were passed by Congress to-day, do you have any hope that the President would sign it? Mr. RAGON. I want to solemnly protest against a proposition like that, with due respect to the gentleman from California. Mr. MACLAEFERTY. I do not take much of the time of the committee, and I thought I could ask that question. Mr. KNUTSON. In order to answer that question, the witness would have to qualify as a clairvoyant. Mr. MAcLAFFERTY. You have no right to object to my question. It is not a finality. Mr. RAGON. I do not see where that should influence us here, the question of a veto by the President. In the first place I question very seriously the propriety of this committee discussing what the executive department will do with a bill, and I do not think we should do it. I do not feel in justice to the executive department of the Government we ought to inject this question into it. We have a written statement of the President and his position on the matter, and I do not think that we ought to in a public meeting at least, go on record as to what may or may not be the President's position. Mr. MAcLAFFERTY. I withdraw the question, because it can be put in another way; in fact, I really prefer to put the question in another way. I want to see you go away from here with legislation which clears up the uncertainty in your country. That is why I spoke as I did, and I believe that immediate independence will not go through this Congress. Mr. BEEDY. I did not want to interrupt the gentleman from California, but I want to make a point of order. I call the attention of the members of this committee to the fact that we are- taking evidence from the witnesses. I do not think members should take the opportunity of expressing their own views. The CHAIRMAN. I think the point is very well taken, though all of us have violated the principle. Mr. MACLAFFERTY. Even the gentleman from Maine. As long as the gentleman suggested that 30 years is too long a period, did he have any suggestion, if the Fairfield bill were to become a law, as to a modification of it in that respect? What period of years did you have in mind? Suppose you can not have immediate independence, and it is a question of getting a perfected Fairfield bill. You say 30 years is a long time, and you may not live to see it. Mr. QmEZON. I would like 25 better than 30, 20 better than 25, 15 better than 20, 10 better than 15, and 5 better than 10, and so on: Mr. BEEDY. In other words, your stand is that you want immediate independence, and you refrain from any recommendation as to the term of years to be inserted in the Fairfield bill? 184 PHILIPPINE LOCAL AUTONOMY Mr. QUEZON. Yes, sir. Mr. BEEDY. Thirty years is too long? Mr. QUEZON. Yes. Mr. SCHAFER. If I recall correctly, in answer to a question propounded by the chairman you have asserted that the enactment of the Fairfield bill into law would determine a definite status. Have you carefully read the provisions on page 10 relative to what will happen at the end of this period of autonomy? Mr. QUEZON. Yes, sir. Mr. SCHAFER. Now, taking the words " definite status " as the basis, could you consistently say that this bill would determine a definite status for the Philippines, in so far as independence went, in the end of 30 years? It is still in doubt as to what that status will be, is it not? Mr. QUEZON. It is definite in so far as to what this Government will do. You bind yourselves to grant us independence if we want it. Mr. SCHAFER. Did not the Jones Act bind the United States Government in the same way by providing that when the Philippines had a stable government they would grant them independence? 'Mr. QUEZON. Certainly. Mr. SCHAFER. All right. If we take the stand it did bind them, is it reasonable to state because this Congress passes this act, just as a preceding Congress passed the Jones Act, that we definitely determine the status? Mr. QUEZON. Of course I do not know what the Government of the United States may do. I take it, sir, that the Government of the United States will fulfill its promises. The CHAIRMAN. Proceed, Mr. QUEZON. Mr. SCHAFER. The chairman questioned you with reference to the Jones Act, with reference to the establishment of a stable government. Is it not reasonable to believe that when the Congress passed the Jones Act, stating that it was the intent of this Government when the Philippines established a stable government to grant them independence, and in view of the fact that Congress did not provide for a complete government for the Philippine Islands and only provided for the! legislature-is it not fair to assume that when the legislature is stable that the Philippine government has complied with the requirement of Congress? Mr. QUEZON. That is why we are urging that independence be granted us now. Mr. SCHAFER. I wanted to clear that up a little. Mr. QUEZON. Mr. Chairman, I should like to be spared the embarrassment of having to answer questions reflecting upon the good faith of the United States or of Congress. You gentlemen know that you can do with us as you please. We can not compel you, we have no power to compel you, to do anything; and since the life of our country depends on you, I do not want to fight you. Mr. SCHAFER. Have you carefully studied section 9 of this bill? Mr. QUEZON. Yes, sir. Mr. SCHAFER. Do you not think that there is a possibility that this bill enacted with section 9, granting all that power and authority in the hands of the commissioner and the President, is more drastic than the present legislation on the statute book affecting the Philippine people? PHILIPPINE LOCAL AUTONOMY 135 Mr. QrEZON. Not more drastic; no, sir; because the Governor General under the present organic act claims to have the right to veto any legislation, and, in fact, the present governor has done that, while under this bill the Resident Commissioner could only suspend temporarily and the President annul such bills as would affect our ability to pay our public debt. If I may suggest right there, Mr. Chairman, since you are the author of this bill, I would rather see that that power of the commission is taken away from him and given to the President. We would not object so much if the President had this right of suspending the effect of any law that would impair the rights of the bondholders, but I am afraid it will be a source of unnecessary friction to have that power in the hands of the Resident Commissioner. It would also be humiliating to the Filipino people. Mr. KNUTSON. The Fairfield bill would continue the present source of friction? Mr. QUEZON. I am afraid so. The CHAIRMAN. Answering your implied question, the Resident Commissioner would have no power, except to suspend, until it would be referred to the President. Mr. QUrEZON. Yes; but it is unnecessary, because nowadays communication between the Philippine Islands and Washington permits the President to be informed daily of what is going on in the islands. If you provide that the Governor of the Philippine Islands should report to the President every law that has been passed by the legislature, the President could act from here without the necessity of having a man there with such powers. I take it for granted the man there would be a wise man, and would not exercise powers conferred upon him by law except when absolutely necessary, but the mere fact that he has this power would be resented. The CHAIRMAN. There is a problem as to whether there ought not to be a Resident Commissioner in the Philippines-some representative of the United States. Mr. QUEZON. I do not object to that. The CHAIRMAN. We can not establish diplomatic relations because it is not a foreign government. Mr. QUEZON. Yes, sir. The CHAIRMAN. So that the Resident Commissioner becomes the only representative of the Government of the United States on the islands. Mr. QrEzoN. I do not object to that, but I object to his power. The CHAIRMAN. A diplomat could protest and does protest against the passage of a law under certain circumstances, and even comparing it with peoples wholly alienated from each other, but more in the nature of a diplomatic representation, though closer than that of a foreign power. There would only be that suspension. I understand how you people might feel in regard to it, but, on the other hand, there was no intention in any way to make it appear that the Filipinos were to be humiliated or subordinated by virtue of this. It was only a means through which larger autonomy could be granted with no friction coming by any resident American representing the Government, that could stop any legislation that you had, and having high regard for your feeling in this matter, which, do you 136 PHILIPPINE LOCAL AUTONOMY honor, I may say we have felt that you have not any objection to matters of that kind being referred to the President of the United States, if he could speak for the 110,000,000 and the right of vetoing 11,000,000 people, that therefore you would have as complete autonomy as any State in the Union, that you would, as far as governmental affairs are concerned, become an integral part of the great Republic, not permanently, but with the added right that you could stay if you wanted to stay, which I think is no mean opportunity. Mr. QUEZON. I do not object, as I said, to the provision that there shall be a resident commissioner in the Philippine Islands. I think the President is entitled to have some one there to represent him and see what we are doing, so that he may be informed from day to dav of the situation, but I object to giving him any power. I think this power should be vested in the President himself. Mr. HUDSON. That is a good suggestion. Mr. KNUTSON. I aml going to recommend that the commission from the Philippine Islands submit, after having studied the Fairfield bill, such amendments as they feel should be incorporated or made. I think that is only fair, and we take those amendments up and consider them in executive session. We do not necessarily have to adopt their amendments, but they should have opportunity to present to the committee such amendments as they feel will strengthen the bill and make for more harmonious relations. The CHAIRMAN. There should be no objection to that. They could be submitted to a member of the committee and this member could bring them in. I think perhaps it would be going beyond the prerogative of the chairman to recognize them as an integral part of the committee, but the suggestion is a good one. Mr. QUEZON. Now, Mr. Chairman, since the committee is so kind as to wish to learn our views regarding the provisions of the Fairfield bill, I will inform the committee right now that we will take advantage of the suggestion of Mr. Knutson and we will give some member of the committee such amendments as we think proper. In this connection I desire to add that there is a still more dangerous power given to the commissioner, and that is his right to use armed forces of the United States to suppress violence, invasion, insurrection, or rebellion, and to protect lives and property. I desire to say most emphatically, Mr. Chairman, that in my opinion it is a very dangerous provision of the bill. The CHAIRMIAN. Just a moment. I understand your objection to that, but the bill contemplates, of course, a continued residence of the American Army in the Philippines. Mr. QUEZON. 'We are agreed on that. The CHAIRMAN. And also the continued residence or maintenance of a naval base. Mr. QUEZON. Yes, sir. The CHAIRMAN. Now, then, with those forces of the United States within the Philippine Islands, they must accordingly be subject to the control of the President of the United States. Mr. QUEZON. Absolutely: yes, sir. The CHAIRMAN. Now, in any State in the Union the President could at any time for the purpose of suppressing violence order the Army into that State. PHILIPPINE LOCAL AUTONOMY 137 Mr. QUEZON. At the request of the governor of the State. The CHAIRMAN. But he can do it, if it threatens insurrection, without that request. Mr. QUEZON. Yes: certainly. The CHAIRMAN. So that the provision there is no more drastic than has been provided in our own Constitution for the suppression of violence, and it may be a very material thing. I would not want, just on the spur of the moment, to decide that. Mr. KIESS. I would like to ask this question: Is it not true that we can land our troops and marines, and we do, in plenty of foreign countries, to protect the rights of American citizens? I do not think that it is any reflection on the Philippine people. The CHAIRMAN. Really, I consider that a very important provision. Mr. KENT. May I suggest this: We are going into the intricate details of one of these bills. A number of the gentlemen on the committee would like to ask questions on the general subject as to whether anything should be done, as to whether independence should be given, or whether we should adopt the Fairfield bill. We are now straying off, it seems to me, from the general subject, and going into the intricate and detailed features of one of the bills. The CHAIRMAN. The hearings are on the Fairfield bill, as I understand it. Mr. MILLIGAN. This is a provision in the Fairfield bill. Mr. KNUTSON. Would it not be proper to ask the representatives here from the Philippine Islands to meet with the committee when the bill is taken up for consideration? The CHAIRMAN. I think when we are in executive session nobody but the members of the committee can be present. I will say this, however, on the matter in hand: Will you please submit any statements you may have to the committee for further consideration, and that will eliminate the necessity of continuing the discussion here. Mr. RAGON. I think this is very vital to the consideration of the bill, and we have had the men from New York here discussing every feature of it. I do not want to take up the time of the committee, but we could save time by letting him go ahead. I want to hear an answer to the question the chairman propounded. Mr. QUEZON. I was going to say this: I admit that the President, as the Commander in Chief of the Army and Navy of the United States, should have the right to use the Army and Navy in case of emergency, but I think it is very unwise to give this power to the Resident Commissioner. In the first place, the mere fact that you have a man there for the purpose of using your armed forces in case of insurrection suggests the idea that you contemplate that the government you propose to establish under this bill may start an insurrection against the Government of the United States. The CHAIRMAN. At that point, might it not be well to state that the provision is intended as much for the purpose of suppression in this direction against the government of the Filipinos, rather than that of the United States? Mr. QUEZON. Then, my answer to that is this: If that is the case, the provision should contain the clause, "Upon the request of the 138 PHILIPPINE LOCAL AUTONOMY governor of the Commonwealth,"? because if the insurrection is to be against the government of the Philippines, that government will see to it that the armed forces of the United States are used for its protection. Mr. KNiUTSON. Would not there be danger, if this provision is written in the bill, that the armed forces of the United States might be used to retain a corrupt government in power that would be objectionable to the Filipino people? Mr. QUEZON. I do not want to say that much. Mr. KNUTSON. I ask you if there is not a danger from that source? Mr. QUEZON. I do not object to your reserving to yourselves the power to use the armed forces of the United States, but the President should have that power. Mr. MACLAFFERTY. Would not the Resident Commissioner be nothing more nor less than a representative of the President of the United States? Mr. QUEZON. Yes, sir. Mr. MACLAFFERTY. Then, why object to his having those powers? Ile would not act without the authority of the President of the United States. Mr. QUEZON. He is not supposed to act without it. Mr. MACLAFFERTY. As a matter of fact, do you think he would if he went there as a direct representative of the President of the United States; do you suppose, of his own free will and accord, he might order those troops out? Mr. QUEZON. He may not be so wise a man? Mr. MACLAFFERTY. You said a moment ago, Senator, you had no doubt whoever they sent would be a wise man. Mr. QUEZON. Well, of course, that is flowery language. Mr. MACLAFFERTY. I would suggest that here all verbiage be omitted. Mr. QUEZON. Of course, ordinarily, it is to be expected that the Resident Commissioner will be a wise man, but I feel that on such a serious matter as this we should not take any chances. Mr. MACLAFFERTY. There would be great objection to thlis bill without that provision. Mr. QUEZON. We do not object to the provision. Mr. MACLAFFERTY. You object to the power as granted to the co'nmissioner by the bill. Mr. QUEZON. Yes, sir; but of course the decision rests in your hands. I am simply making suggestions. Mr. RAGON. I would like to ask a question. The bill suggests a 30-year period. Now, the bill, with that exception, that portion of it is very favorable to you. Mr. QUEZON. Yes, sir; it is better than the present organic act. Mr. RAGON. Suppose you would be granted what this bill contains, do you see any particular use of putting a term of years in there, like 30? Mr. QUEZON. No, sir. Mr. RAGON. There has been some suggestion of a war with this country and some other country, and if we grant it in 30 years, and there would be a war in the meantime, it might render the conditions such that the United States or the Philippines might not want to comply with it; neither of us might, for strategic purposes. PHILIPPINE LOCAL AUTONOMY 139 Mr. QUEZON. As far as I am concerned, and I am only speaking for myself on this point, because I have not discussed it with my colleagues, I would rather have no time fixed than to fix a 30-year period. Mr. BEEDY. Were not your exact words in reply to Mr. Ragon's question that autonomy was agreeable to you? Mr. QUEZON. Autonomy, as compared with our present status. Mr. BEEDY. Do you desire that American capital come and continue to come into the Philippines? Mr. QUEZON. Yes. Mr. BEEDY. Do you realize that American capital will not come unless some definite period is fixed, in which time they may know what they can do and what they can not do? Mr. QUEZON. I do not know about it. Mr. BEEDY. What is your judgment? Mr. QUEZON. What I think would have very little effect on whether they would come or not. My own feeling is that after the establishment of this autonomous government, when American capital has had opportunity to see that it is receiving as good, if not better, treatment than it is receiving now, there will be more American capital coming to the islands. Mr. BEEDY. Do you not think there would be a hiatus there, a period of lapse during which capital would halt until you demonstrate what you could do with your independence? Mr. QrUZON. Yes. Mr. BEEDY. And would not that be to the disadvantage of the development of the islands? Mr. QUEZON. It may be for a short time. The CHAIRMAN. The present situation is so indefinite and so unSatisfactory that that is the only reason for any legislation. Is that true? Mr. QUEZON. How is that? The CHAIRMAN. The present is so indefinite and so unsatisfactory that it is really the reason for legislation at this time? Mr. QUEZON. It is, indeed, very unsatisfactory. The CHAIRMAN. If there was no definite time set down, this continued agitation for immediate independence would go on. Mr. QUEZON. Very likely, unless the Filipinos find that the government contemplated by your bill is satisfactory. Judging from what I know to be the sentiment of my people now, I would say that they will continue to agitate for complete independence. The CHAIRMAN. That we will have the same unsettled conditions we have now continued indefinitely. Mr. QUEZON. If the Filipino people, after this autonomy has been granted, should find a satisfactory government, conditions may begin to settle. I do not pretend to know what the sentiment of my people will be several years from now. Mr. SCHAFER. Your people are all strong for independence now? Mr. QUEZON. Yes; they are. Mr. SCHAFER. Do you think that a people that are so strong for independence as your people are at the present time, if a bill such as the Fairfield bill passes and is enacted into law, do you think that will stop them from continuing to agitate for independence? 140 PHILIPPINE LOCAL AUTONOMY Mr. QUEZON. As I said already, judging from their present feeling, I think it will not. The CHAIRMAN. Suppose the 30-year period were enacted into law,. and they would know definitely in the Philippine Islands that the time was set for them to make a choice, would this agitation for immediate independence continue? Mr. QUEZON. I did not hear that. The CHAIRMAN. If the 30-year period were enacted into law, and the Filipinos knew that a definite time had been set for the right to remain or the right to go, just as the Filipino people chose, would this agitation for immediate independence continue? Mr. QUEZON. If this bill is enacted? The CHAIRMAN. Yes. Mr. QUEZON. It will depend, I think, on how they take the bill. Mr. KNUTSON. Would not the answer to the chairman's question depend largely on how the bill would work out in operation? Mr. QUEZON. Very largely. Mr. KIESS. Would not your people be inclined to take the view that you Filipinos took back to them, if we decide to pass the Fairfield bill-your people had sent you over to get certain legislation? It seems to me when they had confidence in you to send you here, when you go back with your report, and you were convinced that the Fairfield bill was the best that you could get for your people, I take it for granted that they would take the view that your people carried back. If you told your people this bill was passed in good faith, that it was the best you could get; you came to get absolute independence and could not. and you accepted this, the natural view would be for your people to take the view that your commission carried back. Mr. QUEZON. I don't know. Mr. SALMON. If the time fixed for independence was 30 years, and this act should become a law, and you would go back to the Philippines with the knowledge that each succeeding Congress could pass adcitional legislation or change or modify this law. shortening the time or modifying it in any respect that Congress may see proper, would not that be used as a, basis for agitation that the people were not wholly pleased with this law? Do you think they would be pleased with a time limit of 30 years for independence? Mr. QUEZON. I said already, Judge, from the present state of affairs. it does not seem to me they will be. Mr. SALMON. If they would rot be pleased with the knowledge that any future Congress could modify this law by amendment or otherwise, is it your opinion that they would continue to agitate and want the time limit shortened and the provisions of the law modified? Mr. QUEZON. If they are not pleased, I think they would continue to agitate, Mr. Chairman. Mr. BEEDY. One of the ladies here wanted this question propounded to the witness. I presume he speaks for himself and not the whole island on the proposition: If the Filipinos had their choice to-day between immediate independence with instant deprivation of American capital, or postponed independence with the continued assistance of American capital, which would they prefer? Mr. QUEZON. For how long a time? Mr. BEEDY. For 30 years, let us say. PHILIPPINE LOCAL AUTONOMY 141 Mr. QUEZON. Well, I can answer that instantly; they would prefer independence. Mr. BEEDY. You believe if American capital failed the Filipinos, other nations would offer to invest their capital? Mr. QUEZON. I do not know whether they would or not. Mr. BEEDY. DO yOU have any such hope? Mr. QUEZON. We do not care. Mr. BEEDY. How do you expect to raise money by taxation to run an independent government? Mr. QUEZON. Before I answer that question I should like to develop further my point. When I said that we did not care whether foreign capital would come into the Philippine Islands or not, this answer may sound rather sweeping, but I hope it would not be so to American ears. You of all people should understand its meaning, for it is not the first time in your history that you heard that same or analogous statement. It was your great patriot, Patrick Henry, who said, "Give me liberty or give me death,' and it is the same feeling that prompted that patriotic utterance that makes the people of the Philippine Islands consider the economic development of their country secondary to their national freedom. I notice, Mr. Chairman, that the economic development of the resources of the Philippines is alone, or, at least, preeminently, engaging the interest and attention of several people who have appeared before your committee in considering the question of whether you should give the Filipinos their independence or not. Since when has it been considered in this country that economic development has a greater importance than human liberty? Of course, we can not overlook the fact that wealth is an essential instrument of life and progress. But we do know that there is enough money in the Philippine Islands to-day to develop that country, although not as rapidly as it may be developed with the assistance of foreign capital. As a matter of fact, very little private capital has come into the Philippines since the American occupation, and yet we have made great progress in our commerce, agriculture, and industry. The sugar industry to-day is being rapidly developed and the majority of the sugar centrals have been built by native capital and are owned by Filipinos. What would the United States be to-day if the thirteen Colonies had hesitated to declare their independence of England because of their economic condition in the past, taking into consideration what they were in 1776? Who could have foretold that you would be in 1924 as you are-the most powerful Nation upon the face of the earth? We are willing and ready to take a chance and we confidently hope that while we may have some hard times aheadand there is no reason why we should not, since every other people have had it-we shall finally come out triumphant over all our difficulties and, under an independent Philippine government, be a happy, prosperous, and free people. Mr. BEEDY. You have given some thought to the question of the ability of the Filipinos by themselves to raise enough money by taxation to run an independent government. Mr. QUEZON. Yes, sir. 142 PHILIPPINE LOCAL AUTONOMY Mr. BEEDY. And you you think they are capable of thus raising sufficient money? Mr. QUEZON. I think so. Mr. BEEDY. By taxation on property there? Mr. QUEZON. By taxation on property and through the customs. Indeed our per capita tax is very low now. Mr. SCHAFER. I would like to ask a question, Mr. Chairman. Is there not a considerable number of millions of dollars of Filipino money deposited in American banks? Mr. QUEZON. Yes. Mr. SCHAFER. Such as the Chase National Bank, the First National Bank, Guaranty Trust Co., New York Commercial, Riggs National Bank, etc. Is not the Philippine money deposited in certain banks in this country upon the strength of the order of the Governor General of the Philippine Islands? Mr. QUEZON. Yes; the proceeds of our bonds. Mr. SCHAFER. That is Philippine money, though, deposited in these banks, getting from 2 to 2~ per cent interest, and sometimes less than that? Mr. QUEZON. Yes; Philippine Government money. Mr. SCHAFER. Don't you think that money could be used to better advantage by having it over in the Philippine Islands, rather than being deposited in these large American banks and only drawing 2 and 2~ per cent interest and less? Mr. QUEZON. It might be invested in bonds that would draw more interest than these banks are paying. Mr. SCHAFER. Do you know the total or approximate total of Philippine deposits in these big financial institutions in America, which were deposited there upon the authority of the Governor General of the Philippine Islands? The CHAIRMAN. Major Patterson informs me that it is about $33,000,000, and is deposited on recommendation of the Secretary of War. Mr. SCHAFER. $33,000,000-and it is deposited by the order of the Secretary of War, as I understand it, at the request of the Governor General. Mr. BEEDY. It is now nearly 12 o'clock. Unless the Filipino people themselves wish to present testimony-I understand they are content to rest their case here-unless the chairman has some witness whom he wishes to have appear before the committee, I would make a motion to close the hearing and meet in executive session to consider this bill to-morrow morning at 10 o'clock. (Informal discussion.) The CHAIRMAN. There was a gentleman who came in this morning who desires to be heard. Is he here to-day? Mr. HAUSSERMANN. I would like to be heard. Mr. BEEDY. I move that we adjourn until 10 o'clock to-morrow morning to hear the testimony of Mr. Haussermann, at the close of which we go into executive session. A VOICE. The American Women of Philippine Independence desire to be heard before the hearings close. P.LmETjrIpNp E LOQAi. A w, Y.i QN y Mr. MILLIGAN. I would likes to know the gentleman's name, who he represents, and why he wishes to be heard. The CHAIRMAN. You want the gentleman's name? Mr. HAUSSERMANN. My name is John W. Haussermann, resident of the Philippine Islands since 1898. I went over with the troops, served with the Government in Manila, with Assistant Attorney General, practiced law from 1903 to 1915, and ever since have been engaged in business there. Mr. MILLIGAN. Who do you represent? Mr. HAUSSERMANN. I represent myself, vice president of the American Chamber of Commerce, a member of the board of directors, and the director in several other corporations there. Mr. RAGoS Why were you not here earlier? Mr. HATVssERMANN. I was here for a couple of weeks, and I understood you were going to wait for the Philippine Commission, and I went away, and consequently I am back to-day. Mr. BEEDY. I will make a motion that we now adjourn to meet to-morrow morning at 10 o'clock, at;which time an hour shall be allowed any witness who may care to be'heard, and at the end of that time we go into executive session to consider the bill. (The motion was duly seconded.) Mr. SCHAFER. To consider this bill and any other bills in connection with its independence. Mr. BEEDY. If we only have one hour we will not get any further than the Fairfield bill. Mr. SCHAFER. We have another bill for consideration before the Fairfield bill. (Informal discussion.) Mr. KNUTSON. When we go into executive session we can vote on which measure we wish to take up. There is no such thing as priority or anything else, because the Sabath resolution takes precedence. Mr. BEEDY. To consider bills here pending with reference to Philippine independence. Mr. QUJEZON. I want to express my thanks for the kind attention shown to us this morning. (Whereupon, at 12 o'clock m. the committee adjourned until tomorrow, Tuesday, May 6, 1924, at 10 o'clock a. m.) WAR DEPARTMENT, BUREATJ OF INSULAR AFFAIRS, Washington, May 5, 1.924. Hon. Louis W. FAIRFIELD, Chairman Conmittee on Insular Affairs, House Office Building, Washington, D. C. My DEAR MR. FAIRFIELD: From one or more questions of the members of your committee to witnesses appearing on pending Philippine legislation, it appears that it may not be generally known to your committee that all of the facts relating to the location, amount, and conditions governing deposits of Philip101692-24 —10 144 PHILIPPINE LOCAL AUTONOMY pine Government funds in the United States are available to your committee. or to any individual member of your committee at any time. In order to make clear the present situation, I beg to say: The funds of the Philippine government in the United States are held in accordance with acts of the Philippine legislature. Bonds of the Philippine government are sold in the United States, and the obligations as to payment of interest and principal of this indebtedness must be met in the United States. The purchases of the Philippine government are to a considerable extent made in the United States, and these purchases must be paid for in the United States. The greater part, however, of the funds of the Philippine government in the United States are held here to secure the currency of the Philippine Islands and to insure its parity with the gold standard fixed by law. The administrative code of the Philippine Islands provides that the Secretary of War may designate banks in the United States as depositaries of the government of the Philippine Islands, and section 1605 of this code authorizes the Governor General to designate such of these depositaries as he may deem advisable to be branches of the Philippine treasury. The latter provision is necessary if certain of the reserve funds of the Philippine currency system are to be placed in the depositaries. Every depositary of the Philippine government in the United States has been designated by the Secretary of War. The amount deposited in such depositaries has been fixed by the Secretary of War. Certain of these depositaries have, on the advice of the Secretary of War, been designated by the Governor General as branches of the Philippine treasury. The present governor general has never suggested the designation of a bank as a depositary of Philippine funds. nor has he ever made a suggestion as to the amount of the funds to be placed in any of the banks designated by the Secretary of War. Within the limits permitted by legislation, the locating of Philippine government funds is a matter of business. The Chase National Bank, which is the principal depositary and has the largest deposit of funds, was designated by the Secretary of War on November 19, 1914. It is assumed that these deposits are accepted by banks as a matter of business in the hope that they will prove profitable, yet the conditions have not been so liberal but that several banks have declined to accept deposits thereunder. The system pursued in making deposits in the United States has been pursued practically without change for 20 years. It has produced large profits to the Philippine government without the loss in any case of one cent. In conclusion, it should be said that every depositary in the United States makes a monthly report to the treasurer of the Philippine Islands and to the Bureau of Insular Aftairs of the War Department. All information pertaining to these funds and to the depositaries in their relation thereto is available in the War Department and may be obtained by any individual Member of Congress at any time such information is desirable. This information is annually published in official reports. I am inclosing a copy of the statement of Philippine funds in depositaries in the United States at close of business March 31, 1924. Three and one-half per cent interest is received on all of these funds except a relatively small amount subject to draft without notice. I shall be very glad to furnish any further information if the foregoing with the inclosure is not complete. Very sincerely, FRANK MCINTYEE, Chief of Bureau. PHILIPPINE LOCAL AUTONOMY 145 Statement of Philippine funds in depositaries in the United States at close of business March 31, 1924 Designated by branch of Phil-as Secretary of branch of PhilWecretary of ippine treasDepositary ar as deposi- ury under acts Treasurynd neal p urDposi6 certificte poses bonds taryChase National under sec.Bank Nov. 19 Nos1914 Apr. 2603,1916 $4, 766,564. d 5 $964,405. 81$5nd 356,836.15 $2,144,fnd182.50 tra tive Code 2939, and 3058 fd trCommereial in of the Philipothe Philippin pine Island& Islands Legislature Bank, Chicago - Apr. 21923 Mar. 9,1923 1,000,000.0 --- —- ------ --- ------- Chase National Bank Nov. 19,1914 Apr. 7, 1916 $4,766,564. 50 $964,405.81'$5,356, 836. 15 $2,144, 182.50 Bankers Trust Co., Nw New York ------- Dec. 8,1923 Jov. 21,1923 1 00,000.00 --—!- ---- Commercialt National Bank, Washington, D. CTrust Co --- —- Feb. 25,1911 June 29,1917 1,000,000.00 1 --- —---—. ---- - —,.., Continental & Commercial National Bank, Chicago -- pr. 2,1923 Mar. 9,1923 1,000, 000.00 ---------- Farmers' Loan & Trust Co., New York -- - Feb. 3,1923 June 22, 1923 1,500,000.00 1,000,000. 00 -------- Fidelity-International Trust Co ------ Mar. 2,1923 Mar. 8,19231 750, 000.00 ---------- First National Bank,Boston Co --- Feb. 0,1922 Mar. 1,19231 2,000,000.00 ---------- Guaranty Trust Co., N Newa York__ Jan. 13,1923 Jan. 13,1923', 500,000.00 1,000, 000. 000 ------------------- Harris Trust & Savings Bank ---------- Sept. 19,1923 Sept. 14,19231 500,000. 00 ----- ------ - Irving Bank-Columbia Trust Co --- Feb. 5,1923 Jan. 22,1923 1,000,000.00 --- —-------- The Marine Bank & Trust Co., New Orleans, Las Nov. 27,1923 -Nov. 21,1923 1 500, 000.00.- ------- Market Street National Bank, Philadelphia -........... Sept. 24,1923 Oct. 8, 1923 1,000,000.00 Mercantile Trust Co., St. Louis..._. June 22,1907: May 15,-191.._7_- - 00000 National Bank of the Republic, Chicago_ July 23,1923 July 30,1923 1,00000000. -------- National City Bank J 23,1923 an. 13,19231 2,000,000.00 - National Park Bank of New York ---- I Mar. 6, 1924 Feb. 18, 1924 1 000 000.00 National Shawmut Bank of Boston --- Nov. 19,1913 May 15,1917 500,000. 00 ----- - --------- New York Trust Co. of New York --- —- Feb. 28,1924 Feb. 18,1i924 1, 000, 000.00 Old Colony Trust Co- Dec. 22,1922 Jan. 13,19231 1,00000. 00 --- —------------- Riggs National Bank Jan. 23,1923 Jan. 17,19231 1,000,000. 00 -------------— _ --------- Second National Bank, Washington, D. C ---- - May 14,1923 July 3,1923' 500, 000.00 United States Trust Co., New York —.- Feb. 14,1923 Jan. 22,1923 1,000,000.00 Total -------- -----, ---- 24, 516, 564. 50 1,964, 405. 81 7,356,836.15 2,144,182.50 1 Cable. COMMITTEE ON INSULAR AFFAIRS, HOUSE OF REPRESENTATIVES, Tuesday, May 6, 1924. The committee this day met, Hon. Louis W. Fairfield (chairman) presiding. The CHAIRMAN. Gentlemen of the committee, when we adjourned yesterday a motion was made that we go into executive session this morning at 11 o'clock. That gives only about 40 minutes for any further hearings, and I understood the hearings were to close at that time. Mr. HUDSON. Mr. Chairman, a lady asked to be heard briefly. The CHAIRMAN. Do you desire to be heard? 146 PHILIPPINE LOCAL AUTONOMY Mrs. WEED. Yes, sir. The CHAIRMI.AN. Mrs. Alena Hill Weed, of Connecticut, a member of the American Women's Committee for Philippine Independence, speaking as an American citizen, will now be heard. I think we shall have to limit the lady to about 10 minutes. Mr. KNUTSON. We only have two, speakers this morning, and I understand we proceed to the consideration of the bill in executive session. Is that understanding correct? The CHAIRMAN. The Chair made a statement a moment ago with regard to that. STATEMENT OF MRS. ALENA HILL WEED, OF CONNECTICUT, REPRESENTING AMERICAN WOMEN'S COMMITTEE FOR PHILIPPINE INDEPENDENCE Mrs. WEED. Mr. Chairman and gentlemen of the committee, while I represent the American Women's Committee for Philippine Independence, I am a representative of a great many other women's organizations and I may state that I wish to speak in opposition to any further control of the Philippine Islands, either through this or any other bill, and I speak for immediate independence for the Philippines. I may say, as I have heard other speakers refer to their connections, I am president of the local League of Women Voters in my section of Connecticut. I am a founder and one of the original members of the National Women's Party, committed to secure equality of rights under the American flag. I am a member of the American Civic Labor Union to protect the civic liberties of every human being under the American flag. I might go on indefinitely with my connections in order to show you that I do have knowledge of the state of mind and conscience of those people with whom I have been connected, and that is a very large group; and I want to say first in opposition to the bill that I believe any further control of the Philippine Islands is in absolute opposition to the fundamental principles of our own government, which we recognize now and which we have also recognized in theory from the very beginning, the fundamental rights of all peoples to freedom, to liberty, to independence, and to self-government, and I am opposed to any further control of the island peoples. I want to say further that I think at this time one of the most serious problems facing the American people is the question of their faith in their own Government. I see with full knowledge the commercial imperialism, of which I will speak later-not only that but of the very purposes of this bill-that the idea of it seems to further extend and develop the policy of commercial imperialism as a fundamental policy of the United States Government, and to that I myself personally and all people which I represent are most earnestly opposed. I have some knowledge of American commercial imperialism. because my original profession is that of an economic geologist. I practiced that profession with my husband, who was a mining engineer, both in the study of pure science and scientific work and mineexamination work. I have seen every copper deposit and every copper mine of importance of the North American Continent. I PHILIPPINE LOCAL AUTONOMY 147 have seen commercial imperialism in work, and I konw how it works and why it works. I have seen the work in the undeveloped Hispanic sections of North America. I saw it in Haiti. In 1907, with my husband, we made a study of the copper resources in Haiti. There were not 200 white people in the islands. Most of the people did not know the difference between Haiti and San Domingo or Haiti and Hawaii at that time. I saw it following occupation by the United States Government troops. After I stopped the practice of geology, which I practiced for some 15 years, I then went through the school of journalism and have been in the journalistic profession. I went to Haiti as a correspondent of one of the two great press associations of this country and saw the situation in full sway. I stayed after the investigations and saw the influence of American commercial expansion in Haiti. I saw officials of the United States Government in Haiti sitting on the porch of the hotel and heard an official of this Government in power telephone to the military forces to send him an automobile to go across the island. The newspapers of Haiti that day said that this official was there in the interest of establishing agricultural banking and the pineapple industry in Haiti, but you and I were paying for the expenses of this gentleman to develop his own private interests in Haiti. I have seen it work in other places. I will not go into detail, but I could spend a very profitable morning telling you of my experience there watching commercial imperialism at work in the weak and unprotected countries. Speaking from the standpoint of a woman who represents the conscience of all American women on this question of opposition of commercial imperialism and the protection of private interests by the Government of the United States, and the financing of them in their ventures in foreign countries, I would like to read a very brief statement of our position. By sheer force of our military power, unjustified by any acts of aggression by the Filipinos or by any legitimate argument of demonstrated inability to exercise the long-promised, inherent right of all peoples to self-government, the power of our great Government (dedicated to the principles of liberty and freedom as the inviolable right of all the nations, great and small) is still being used to deny to the Filipinos their right to free, popular government. The continued imposition of military pressure in violation of all our fair professions of belief in democracy is the means whereby individual Americans are absorbing for their own aggrandizement, not for the welfare of the American people or the American Government, the natural wealth of this helpless people whom the fortunes of war, in another region and for a cause in which they had no part, has put within our military power. Do not deceive yourselves, gentlemen. If the Philippines are not freed and given their independence now, they never will be. Ten, twenty, thirty years hence the invisible chains of trade and cominerce, finance and industry, vested interests and investments-which you so frankly agree are the reasons for further delaying the promised freedom of this helpless people-will be too strong for the oldfashioned advocates of such an outlawed doctrine as "liberty" and "the fundamental rights of people" to break. 148 PHILIPPINE LOCAL AUTONOMY You can not, by the ignoring of the facts in the situation, or by the palliation of skillful argument as to the value of continued development of the Philippines by American interests remove this question from the high plane of the fundamental right of all nations and peoples to human and political freedom to the lower plane of expediency and opening of opportunities for commercial expansion for individual Americans. Questions of the building of roads, systems of taxation, efficiency in the collection of revenues, immediate economic development of the natural resources of the islands, all pale into insignificance in the glaring limelight of the wrong that our Philippine policy is doing to the fundamental principles of international justice, order, freedom, and world peace. Loyalty to all that America professes in her political life to-day and loyalty to all the ideals on which our cotutry was founded demand that the Filipinos be given their independence and complete political freedom now. I make this statement to you, gentlemen, with personal knowledge of the conscience of American women, and with full realization that they know their political power, and that they have an earnest intention to express their conscientious convictions in political action. I am a member of one of the two parties of my State. It does not' make any difference as to which party I belong, but I represent the opinion of the people of this country, and I say to you the women are standing to-day on principle. We believe in the system of our government now, and if we want to keep up our system of party government we have got to carry into action through the political parties the principles which are more to the American people than party power and party success. I say it is impossible to hold American women in parties to-day if the party in power, or the party seeking to get into power, refuses to make basic principles superior to expediency. The CIAIIRMAN. You think that because we have retained them so long that we have violated our principles? Mrs. WEED. Yes, sir: I think so. I do not question that the Philippine Islands have probably been better developed economically under our control, and a greater wealth will come out of them, and a greater profit hlas been: made from them by American control. I do not challenge the character of the control being improper in itself, but in principle I think it is wrong. The CHAIRMrAN. Your position is that immediately on the ending of the Spanish-American War we should then, immediately, have turned the government over to the Philippines and have withdrawn at that time? Mrs. 7WEED. It is rather difficult to unscramble the eggs. I had not thought deeply on that subject at that time, in 1898, and I think it is impossible for me to express an opinion; but to-day we are looking toward the future. The CHAIRMAN. The only question is whether it was proper for the United States to retain control in the interest of the people themselves. That has been at least proclaimed. You understand there were two principles developed at that time, one antiimperialism and the other — PHILIPPINE LOCAL AUTONOMY1 149 Mrs. WEED. I represent that old 500,000, the old antiimperialism society, who to-day by wire authorized me to use their name in speaking here. The CHAIRMAN. One great political party, the Democratic Party, continuously has taken that attitude. Mrs. WEED. I am a member of the Republican Party and a member of the party machinery. My father, Mr. Hill, of Connecticut, sat here for over 20 years, and I do not think my Republicanism can be challenged because of my belief. The CHAIRMAN. I am calling attention to the fact that there have been two great contentions, honestly entertained. I just wanted to find out what your position was. Mrs. WEED. Mr. Chairman, I think both the Republican, and Democratic Parties are split on that issue. I do not think the question of remaining in the Philippines or not could, in truth, be stated to be either Republican or Democratic. It is a position in which we all take an individual stand, but I do believe that no question of commercial expansion, no question of the development of the natural resources of any other country is of the slightest importance compared with the fundamental rights of the peoples, the freedom in government. The CHAIRMAN. Have you familiarized yourself with the terms of this bill? Mrs. WEED. In a way I have. In another way I have not, but the fact remains that the bill means continued deprivation of political liberty to a people who ought to have it. They have their own language, their own race, culture, and their own fundamental desire for self-government and self-expression and self-development, and I believe they are entitled to their independence. It is absolutely contrary to every principle of our Government to hold them under our control when they came under our control by the merest chance. Mr. KNUTSON. You have been to Haiti, and so have I.L Mrs. WEED. Yes, sir; I saw you there. I knew you, but you did not know me. Mr. KNUTSON. We went into Haiti in 1915. Mrs. WEED. Yes, sir. Mr. KNUTSON. Since they have had two Presidents, one of them retired alive and the other still serving. Up to that time, from 1804 to 1915, Haiti has had 83 Presidents. How many died in office Mrs. WVEED. Several. Mr. KNUTSON. I will tell you. I want this to go into the record. Mrs. WEED. How long did President Pasot stay in office?. Mr. KNUTSON. He is the exceptionA Mrs. WEED. I do not think it is material to the question. I do not want to debate it. Mr. KNUTSON. I want it to go into the record that out of 83 Presidents but few lived to finish their term of office. Mrs. WEED. Perfectly true. I do not think it is relevant to the issue here, though. The CHAIRMAN. I think it is hardly a parallel case, of course. Mr. SCHAFER. I would not like to bring in the political aspect into a hearing, but inasmuch as a statement has been made relative to the Democratic Party sponsoring Philippine independence, in order to keep the record straight, I would like to ask you if thX minority of 150 PHILIPPINE LOCAL AUTONOMY the Republican Party, that minority led by that distinguished gentleman from Wisconsin, the senior Senator has not advocated Philippine independence, immediate independence, as well as the Democratic Party? Mrs. WEED. I am not familiar with that. Mr. BEEDY. Would the gentleman enlighten the committee? Who is this distinguished gentleman from Wisconsin to whom reference has been made? Mrs. WEED. I do not think that has anything to do with it. The CHAIRMAN. Your conviction is that independence, regardless of educational or any development, we should let them go and do what they please? Mrs. WEED. I do, because I believe people who have advanced like that, with that fundamental right, which is a fundamental demand of every human soul, that they should be allowed to go ahead, and if they do not go ahead as they might, that is their own choice, but they ought to be free to make that choice. STATEMENT OF MR. JOHN W. HAUSSERMANN Mr. HAUsSSERMANN. I am very much interested in the talk of the lady who just preceded me, and on the fundamentals as she expressed it I have absolutely no fault to find. I feel sure the lady has the welfare of the Filipinos at heart, and she advocates what she believes to be to their interest, and she is basing that on fundamental principles. It is true that she does not claim to have actual experience in the Philippine Islands. She does not claim to have lived among them as I have in the last 26 years. She has not the personal acquaintance, nor does she know anything about conditions there. She may not believe it, but there is not a person within the sound of my voice, nor is there a person in the Philippines that has a greater respect and admiration for the Filipino people, and who believes more in their final destiny than I, or who has their interest at heart more than I have. When this committee adjourned yesterday I did not know what Mr. Switzer hadl said, and I asked for an opportunity to bring before this committee the experiences I have had in the Philippine Islands, not that I have any more superior knowledge than they, but I thought after living there 26 years, and understanding their hopes and aspirations, that I thought I could be of some service to the committee. After adjournment I read what Mr. Switzer had said to this committee, and I reread it, and I find that statement which he had prepared (and I did not know anything about it until I read it) treats of the subject in a very comprehensive manner. He bases his statement on fundamentals, and if I would take a week talking to you I could not do any better than to ask you to study carefully that statement. It expresses my sentiments. The statements contained in his remarks are facts that come from actual experience. It may be of interest to this committee to know that Mr. Switzer went to the islands about the same time I did. We went there with the Army. It so, happened that he cast his lot down in the city of Cebu, the home of Senator Osmanio, several hundred miles away PHILIPPINE LOCAL AUTONOMY 151 from Manila. I cast my lot in Manila. I stayed there with the civil government, and then practiced law, and then I went into the commercial business. During those 26 years I do not think I met Mr. Switzer but a very few times. I never talked to him about the islands. I had not seen him until yesterday for five or six years, he having been carrying on his business from New York. It seems rather significant that two persons, two Americans, who spent the same number of years in different parts of the islands and made a study of the situation, should have arrived at what we believe to be the same fundamental principles underlying whatever action you may take. When I made up my mind in February last to come to the United States to spend a year in trying to put the true picture of the Philippine Islands before the American people I made a note of the propositions that I thought I would like to put across to the American people. They are as follows [reading]: First: My firm conviction that the general welfare of the Philippine people and their material and social advancement will progress much more rapidly under American sovereignty than under Philippine independence. Second: American sovereignty in the Philippines is the greatest stabilizing influence for law and order in the Far East. Third: The withdrawal of American sovereignty from the Philippines means the beginning of the end of Anglo-Saxon influence in the Far East, in India and Egypt, and also means, my fellow Filipino friends, the beginning of the end of the commercial and political aspirations of the Filipino people. The American people need the tropical products of the Philippines, and the Filipino producer needs the free American market. Mr. Chairman, my interest in this question after 26 years centers on this point: The withdrawal of American sovereignty from the Philippines means the beginning of the end of the commercial and political aspirations of the Philippines. Mr. Chairman, I am not much concerned about political leaders of the Philippine Islands. I am not much concerned about the investments of the Americans in the islands. 'Tis true their investments would be ruined, but, sir, if the ruination of American investments in the Philippine Islands means a better future for the Philippine people, I say make the sacrifice. Gentlemen, I do not care what your party politics may be, I appeal to you as American citizens to approach this question as great, true-hearted American citizens, representing this great Nation in Congress. Whatever you do let the touchstone be that which you firmly believe to be to the interest of the Philippine people. My interest, as I said, is not concerned with the Philippine leaders or concerned with the American investments there, but I have in mind to-day when I talk to you the great mass of Philippine people throughout the islands. It is with those people that I have come in contact, they who are tilling the soil, who are peaceful, quiet, hospitable, and eager for an education. They have developed wonderfully in every way. You can't find a people on the face of the earth that are any more worth while than the Filipino people. It is the welfare of the mass of the Filipino people that concerns me. I would not withdraw the protecting hand of the American Stars and Stripes. I would give them every opportunity to develop themselves. I would give them every opportunity to develop their government, which we believe will lead to their advancement and 152 PHILIPPINE LOCAL AUTONOMY development, but I would not withdraw the protecting hand of American sovereignty, because when we withdraw our sovereignty it means in my humble opinion that they will go back, not because they will go back on their own accord, but because of economic conditions, and the tremendous surrounding influences in the Far East that will take the lands of those people and we will then see the tremendous commercial imperialism which you so dread. I am against commercial imperialism. I am against imperialism of all kinds, but I would like to put before you gentlemen a vision which I have. If we keep our protecting hand there and allow them to develop themselves as I believe they will, we will see in the course of a very few years a nation of Filipinos growing in number, growing in every possible kind of advancement, and in due course I see a nation of 25,000,000 or 30,000,000 Filipino people, under the protecting influence of the American flag, and, if my vision comes true, the Filipino people will become the leaders of the brown race in the Far East. Why have I that vision? Because notwithstanding all these societies for peace, notwithstanding all these societies that we are organizing here, groping for that which we all hope to obtain, namely, peace and contentment in this world. I think we are neglecting the very means which will bring that about. The powerful influence of American sovereignty acting on the Filipino people and through them on the people of the Far East will bring this about. We should, therefore, allow our influence to work upon the Philippine people, allow the American ideals of civilization to grow in the Philippine Islands, and then let that gradually spread, spread until it will effect every bit of the Far East, India, Egypt, and then we will have that world peace which we all desire. We will have contentment because the people of the world will understand each other, and there will be a will to peace: therefore, I am only here for the purpose of asking this Congress not to withdraw our sovereignty over the islands because it means so much to the Filipino people and the Far East. As to the pending bill, I say it is a step toward independence, but I will go further-the Fairfield bill, in fact, grants the Philippine people independence under the protection of the American flag. I was rather impressed with what Senator Quezon said about the Resident Commissioner. There is food for thought. The only amendment I would suggest in that bill, and that is in the line with the suggestion of Senator Quezon, that is, the Resident Commissioner, who nmust be there, should not have the power to suspend, annul, or modify any law. Let that great power rest in the President of the United States. The CHAIRMAN-. Under the terms of the bill he has no power to annul or modify. He can only suspend until the decision of the President is made known. Mr. HAUSSERMANN. I judged from Senator Quezon's remarks he did. But I would take away any question of friction. I would put that responsibility upon this great Nation, acting through the President of the United States. Mr. BEEDY. Have you read the, Fairfield bill? PHILIPPINE LOCAL AUTONOMY 153 Mr. 'HAUSSERMANN. Yes, sir. He has power to suspend any bill if he thought that would interfere with the payment of the obligations of the country until the President acts. That is what I would take away from him and put in the hands of the President. The CHAIRMAN. Now, I have a request here: " Mr. Chairman, I am greatly desirous that Mr. Switzer may be heard again very briefly." Mr. HUDSON. If we had time, I wish we might have Mr. Switzer come to the witness stand. After the discussion of the distinguished senator from the Philippines, the question of time embraced in the Fairfield bill is one of the important factors. I would be very glad if he would be so kind as to discuss the question of time. Mr. SWITZER. Mr. Chairman, in deference to the request that has been made on the question of 30 years, I would say that provision, I think, is an extremely important one, and I will approach it as I always do any Philippine question, from what I think is to the advantage of the Filipinos. The greatest difficulty in the islands has been the indefinite status. This bill of 30 years makes that definite. We should by all means put in something definite. Now you say why 30 years? There are several reasons why, and my first reason, and one that appeals to me most, is the reason which lies as the basis of the thoughts of the gentleman who preceded me. You have established in the Philippine Islands a basis of development, social, political, economic, that is not an oriental basis. It is a western basis which requires a greater degree of prosperity to sustain than most of the oriental nations have. There must be no wrecking of the economic structure or you shock the western standard on which we started these good people. Any period much under 30 years will be a shock to the economic welfare of the islands. because it is too short a time for new capital to go there and turn around before independence comes, and it is too short for even those who already have investments there because the value of their holdings will at once shrink. This will set the Filipinos back, not of their own volition, understand, but it will be beyond their control despite their own efforts. With the kindest deference to the lady who spoke this morning, I challenge her to show where there has been any so-called exploitation in the Philippine Islands. Mr. KNUTSON. Will the gentleman yield for a question right there? Mr. SWITZER. Yes, sir. Mr. KNUTSON. From what do you draw the conclusion that capital would stay away from the Philippines if the time limit in the Fairfield bill were set for a lower figure than 30 years? Mr. BEEDY. With your experience in the Philippines you have learned never to get in an argument with a woman? Mr. SWITZER. I have been out of the United States so very many years I could very easily make that mistake. Mr. Chairman, in the first place, the capital which that country needs to develop it, is capital that must go into certain industries that take quite a while to develop-let me cite one for example: Rubber, which this country needs above all things. We are to-day sitting out on a limb, so far as our rubber supply is concerned, because it all comes from countries controlled by other powers. 154 PHILIPPINE LOCAL AUTONOMY Let us assume that if the Fairfield bill passed, in all probability the Government under that bill would not be in operation for a year and a half. It takes about two years to clear the forest for a rubber plantation. That is three and a half years. It takes seven years after a rubber tree is planted before it begins to yield and even then the output is small. This makes 10~ years. It takes another four or five years before the output is enough to give much return on the investment. You have at least 15 years before a man really begins to realize on his investment in rubber. How many more years have you left, if you do not give them 30 years, for a man to get his capital back and some return on it? Mr. SCHAFER. Will the gentleman yield for a question? Mr. SwVTZER. If it is not consuming too much time. I would rather finish my statement and answer you later. However, I am very glad to answer the gentleman. Now that is only one illustration, that if you make the time shorter than 30 years you defeat one of the main purposes of this bill. Give those people independence and you make an economic condition over there which makes it almost impossible for them to keep up the high social, political, and economic standard which God knows I want those people to maintain. They are entitled to it. No one could wish more for these good people than I do, and moreover there is not a thing that will injure us that will not injure them, and there is not a thing that will injure them that will not injure us. Now, let us not make the mistake and think because capital will go there it is a crime. Our own country, as you well know. was developed largely by money that came from Europe, and we did not consider that we were being throttled over here by money which came from Europe. It was a godsend to us to develop our country. Moreover during this period of 30 years these good people will have in their own hands the power to control that investment, and there is no possibility of unfair exploitation, none whatsoever. I do not believe you have heard very much complaint over here even by the advocates of Philippine independence of objectionable American exploitation in the islands. I should say. furthermore, give them this definite period which let us hope will stop this agitation. They know they are going to get their independence. There is no question about it. Capital or anything else going in there can never interfere with their getting it. Another thing, gentlemen, in my opinion, you ought to bear in mind in considering this question of independence or this bill, and I am again thinking of the Filipinos' side, if you do decide definitely they shall have independence now, or in a year, or two years, or three years, how do you know what is going to happen in the next 10, 15, or 20 years while the world is again settling down to somewhat of a normal basis? Am sorry there is no time to develop this and a few other ideas on this question of time. The CHAIRMAN. Mr. Switzer, the time at which we adjourn has come. Mr. SCHAFER. I wanted to ask a question on that. I would like to get unanimous consent for two minutes. TWe have heard a whole lot about a definite status, and the hesitancy of capital to go into the Philippine Islands on account of not having a definite status. In PHILIPPINE LOCAL AUTONOMY 155 opposition to that, in opposition to taking off the time limit, you went into a lengthy explanation of how long it takes to develop rubber, practically inferring that if we would lessen the period as provided by the Fairfield bill that the rubber interests would hesitate to go into the Philippine Islands, was it not? Mr. BEEDY. Will you assure us that you will complete your question in two minutes? iMr. SCHAFER. I will ask it now. How, then, if rubber interests would be reluctant to go into the Philippine Islands, on account of the indefinite status or the shortness of the time, can you explain the fact that with the status as it is now, without the adoption of any legislation, that a large American rubber concern has been trying to raise the limitation on the amount of acreage of land a corporation could hold over in the Philippine Islands in order to go into the Philippine Islands under the existing status? Mr. SWITZER. I will answer that question by asking you did that rubber company go into the Philippines? Mr. SCHAFER. No; but they must have been preparing to. Mr. SWITZER. They did not go. That answers your question. Mr. SCHAFER. They were trying to go. Mr. SWITZER. They made enough investigation, and they did not go. Mr. SCHAFER. Because they could not coerce the legislature to extend the amount of acreage that a corporation could hold. Mr. SWITZER. I do not consider it coercion to ask for a larger area for an industry of this kind and so far away. The area might have been one of the reasons, but there were many other reasons; and they did not go. Mr. ROXAS. If the committee please, before the close of the hearing, in the name of the Philippine delegation I respectfully request permission to supplement the remarks of Senator Quezon in the record to answer the arguments which have been presented before he came from the Philippine Islands and to answer the statements made by the two gentlemen who have spoken this morning. Mr. KNUTSON. You will present that? Mr. RoxAs. Later. Mr. KNUTSON. We can not give any more hearings. Mr. RoxAs. We can insert it in the record. The CHAIRMAN. Mr. Roxas wants the privilege of having Senator Quezon's remarks extended in the record. Mr. HUDSON. Are they voluminous? Mr. RoxAs. A few pages. Mr. HUDSON. I understood yesterday we did give you the right to file a brief analyzing the Fairfield bill as you saw fit. Mr. RoxAs. The amendments. Mr. MILLIGAN. I move that we allow these gentlemen to extend their remarks in the record. (It was unanimously agreed that Senator Quezon should have the privilege of extending his remarks in the record.) Mr. RoxAs. I thank you very much. Mr. SCiHA.FER. Mr. Chairman, I have some papers here now, which I spoke about a few days ago, and I believe I had permission to insert them in the record. (The papers referred to are as follows:) 156 PHILIPPINE LOCAL AUTONOMY REPLY OF THE SPECIXAL MISSION TO THE UNITED STATES TO GOVERNOR GENERAL WOOD'S CABLEGRAM. TO THE SECRETARY OF WAR General Wood accuses the Filipino representatives in the United States o(1 disseminating what he calls "false and misleading propaganda" intended to deceive the people of this country. He further states that if independence were gr jnted the Philippine Islands to-day it would mean the destruction of wet tern civilization in the islands and would immediately bring about pullic disorded and economic depression, and even goes so far as to say that it would create a state of helplessness and idleness among the people, which wo'uld spell untold calamities for them. Governor Wood rounds up his statement with the assertion that the Philippine Islands should not be granted independence until they are organized economically and from a standpoint of natirnal defense, to enable them to repel external aggression. The Philippine representatives in the United States have done nothing more than to lay their case before the Government and people of the United States, and for the last 25 years have endeavored to enlighten public opinion in this country as to real conditions prevailing in the Philippine Islands and to correct the mass of misinformation derogatory to Filipino capacity for selfgo:-elriament disseminated in this country by self-seeking imperialists under the guise of philanthropy and altruism. The statement of General Wood is a serious indictment of 12,000,000 people, and no effort is necessary to discover the bias and rank prejudice that has prompted it. Statements of this nature. containing broad and sweeping conconsions unsupported by real and actual facts, and which are the product of a determined effort to prevent the Filipino people from achieving what in justice they are entitle to, seriously obscure the issues involved in the Philippine problem. and when uttered by a man occupying the official position that Governor General Wood does are very unfortunate indeed, for they tend to create in the minds of the Filipinos serious doubts and misgivings as to America's real and true purposes in the Philippines. The representatives of the Filipino people have presented the facts and figures to support their appeal for freedom before the Congress of the United States, and these facts and figures stand in the record unchallenged and undenied. Moreover. as we have stated time and again, the question before the Congress now is no longer whether we are ready economically or from the standpoint of national defense to maintain an independent government —for that was settled in our favor by Congress way back in 1916-but whether the Government and the people of the United States will redeem the promise to grant us our independence, as contained in the Jones law, now that we have fulfilled the only condition imposed upon us, namely, the establishmet of a stable government. That the United States will redeem its plighted word is the hopeful expectation of the Filipino people, convinced as they are that the people of this country will not be swerved from the clear path of national duty and honor by the organized propaganda of selfish interests. The CHAIRMAINr. We will now go into executive session. (Whereupon, at 11 o'clock a. m., the hearings were closed and the committee went into executive session.) (By unanimous consent of the committee the following statement by Prospero C. Sanidad, member of the Filipino Collegians of America, and president of the Filipino Community Center of Washington, D. C.. was inserted in the hearings:) THE FAIRFIELD RBIT, HT. R. 8856 Mr. Chairman and gentlemen of the committee, I want to thank you for the privilege of appearing before the committee. In connection with the discussion of the question of Philippine independence, and of any bill pertaining thereto, perhaps it is significant to note that almost all argument forwarded on behalf of the Filipino cause came to you as the official voice of the government and people of the Philippine Islands. I speak to-day not in any official capacity but in the role only of that of a citizen of the Philippines. PHILIPPINE LOCAL AUTONOMY 157 It will also be noted that the government of the Philippines and the people therein have time and again voiced their gratitude for the kind and considerate attitude of America in all the times of their relation unto this day. If it is only to repeat the same statement, I want to say that' we keep for America and her Government and people a genuine and unsuspecting gratitude, and we have unqualified confidence in the intentions of this Government toward the Filipino peoples. The Fairfield bill now under consideration is one of the great evidences of that kind intention. This bill, in the viewpoint of the private citizen, is a kind bill, designed, I take it, to afford the Filipinos a wider field and a broader latitude for the exercise of powers therein stated in this bill, powers that are instructive to the science of self-government. It is, perhaps, different from anything we have had in the past. However kind it is, however liberal it is, however well-intended it is, this bill does not fully measure up with the aspirations of the Filipinos for complete political independence. This bill, disrobed of its pleasant grants for the election of a governor, for the assumption of a new name, for the calling of a constitutional convention, and other conditions therein, that sound descriptive of a truly independent state, this bill in substance does not give to the Filipinos any more tangible proof for the acquisition of complete independence; it does not place them any closer to that political status than they are to-day. I do not intend to take up more time of this committee in pointing out the nonpleasing sections of this bill, as they have been fully stated by the able president of the Philippine Senate, who testified yesterday. I want to say, however, that, in my own understanding of the bill, the Filipinos, as is generally taken to be the meaning of this bill, the Filipinos are not given the absolute option at the end of 30 years after the inauguration of the commonwealth by law to submit to a plebiscite, to decide absolutely for the political status of their country. I fail to see that option expressed in this bill; but on the other hand I find that in section 11, which deals with that phase of the bill, after setting forth cert.ain conditions therein specified and other relations between the United States and the commonwealth, and providing for the adjustment of those conditions, the bill goes on to say, on page 10: " When such a satisfactory adjustment has been made, the President shall thereupon withdraw and surrender all right of possesgionp, jurisdiction, and sovereignty exercised by the United States in and over the territory and people of the Philippine Islands; and he shall, on behalf of the United States, recognize the independence of the Philippine Islands as a free and self-governing nation." Mr. Chairman, that clause, " when such a satisfactory adjustment has been made," I fear will be as mischievous as the provision of " stable government" in the Jones law, for both are matters of interpretation; and I take it under this bill that conditions are satisfactory only when it is so interpreted by the Government of the United States. Thus I say that, contrary to the common interpretation, the bill does not give the Filipinos the absolute option at the end of the period so stated therein, but the result of their plebiscite must depend upon a condition to be decided by the Government of America. As such I do not think that this bill places the Filipinos any closer to complete independence, which is the only cry of the people. In the face of this interpretation-if it is not out of place to repeat the great statement of Patrick Henry, " Give me liberty or give me death!"-I say in this instance " Mr. Chairman, please give us complete independence or give us nothing!" I submit this statement for the record if for nothing else but to give cause for America to think that this bill will never calm the demand for complete independence. x "4ow, k i II I I *4~~~~~~~~~~~~~~~~~~~~~~ UNIVERSITY OF MICHIGAN 3 9015 02483 1607 FEB 241941 THE UNIVERSITY OF MICHIGAN DATE DUE MPhNihfa&- 11 m Wlm APR 0 6 19t -ix:1 1/I X vi i. I: I. 7 I:g: ^:el. ill "# '-3' N ' f: I / 1ok J1 > 0IH