i, Provisioj I pvernor, 1906-1909 (Charles
E. Magoon)
Annual report ... to the Secretary of War ..
1906/07.

YALE UNIVERSITY
LIBRARY

i948

ANNUAL REPORT OF
CHARLES E. MAGOON
Provisional Governor of Cuba

TO THE SECRETARY OF WAR
1907

WASHINGTON
GOVERNMENT PRINTING OFFICE
1908

War Department,
Washington, D. O. , January 13, 1908.
My Dear Mr. President: I herewith submit the report of Hon.
Charles E. Magoon, the provisional governor appointed by you under
that part of the Cuban treaty known as the Piatt amendment tempo
rarily to administer the affairs of the Republic of Cuba. The report
is a most interesting one and shows the conditions in Cuba to be very
encouraging. Governor Magoon has conducted matters in a most clear-headed and
tactful way, and with conspicuous success. He has carried on his
shoulders the whole burden and responsibility of an extensive gov
ernment. He has successfully handled numerous important economic
questions, including the work of planning and initiating a system of
wagon roads coextensive with the island, and other long-needed
improvements. He has had labor troubles, which, through his con
ciliatory but impartial attitude, have been brought to an end. He has
dealt with the two parties in such a way that, when I visited the island
in April of last year, the representatives of all of the parties virtually
agreed upon a program set forth in a letter which, after submitting
it to you for approval, I wrote to Governor Magoon for publication.
This directed —
First. The taking of an electoral census of the island.
Second. The testing of the tranquillity of the island and the capacity
for the exercise of political franchise, without disturbance, by the
holding of municipal and provincial elections.
Third. After a period varying from three to six months, the hold
ing of a Congressional, Senatorial, and Presidential election.
Fourth. The delay for four months, in order to comply with the
constitution, for the completion of the Presidential election and the
installation of the President and Congress.
It was hoped by some that the census might be completed in Sep
tember last. I did not think so, and I am not at all surprised to learn
that the census has not yet been completed and probably will not be
until April or May. This will postpone the local elections until June,
the Presidential election until December, and the installation of the
President and Congress and the turning over of the island until about
March or April of 1909. This is in compliance with our promise when
we assumed temporary control of Cuba, and it seems to me that we
ought to allow nothing to interfere with carrying out that promise.
There are important interests that would be glad to delay our stay
there for years, but good faith and good policy both, in my judgment,
require us to leave at the time appointed.
Sincerely, yours, Wm. H. Taft.
The President. (3)

ANNUAL REPORT OF THE PROVISIONAL GOVERNOR OF CUBA.

Republic or Cuba,
Under the Provisional Administration
of the United States,
Office of the Governor,
Habana, Cuba, December 1, 1907.
Sir :_I have the honor to transmit the annual reports of the acting
secretaries of the several departments of the Government of Cuba,
presented by them to the provisional governor.
I take advantage of this opportunity to submit also a statement of
the workings of the provisional administration of the Government of
Cuba during the time I have occupied the position of executive head
of that Government.
The events leading up to and requiring the establishment of the
provisional administration are now well-known historical incidents,
and were fully reported to the President of the United States by
you during the time you were the provisional governor of Cuba, and
therefore repetition is unnecessary.
It seems appropriate at this time to reiterate the genesis and legal
status of the existing administration of the Government of Cuba.
As a result of the war for independence waged by the Cuban people
and the Spanish- American war the sovereignty of Spain was with
drawn from the island and the military government was established.
When the time arrived for the withdrawal of the military govern
ment and the establishment of the new Republic of Cuba, it became
necessary to secure recognition from the governments of the earth
of the independent sovereignty of the new Republic and the consent
of those governments to its admission into the family of nations
with equality of right as to international relations. Thereupon it
became advisable for the United States to guarantee the preserva
tion of Cuban independence, the maintenance of a government in
the island adequate for the protection of life, property, and indi
vidual liberty and the discharge of the obligations imposed by the
treaty of Paris.
The matter was presented to the Cuban constitutional convention,
then in session, and provisions well adapted to accomplish the desired
(5)

end were made a part of that instrument. This relation between
Cuba and the United States is not a limitation upon its sovereignty
and independence ; it was the buttress by which sovereignty and in
dependence were protected and sustained; it is the guaranty by
which the Cuban Republic is assured of equality of right and privi
lege in the assembly of nations.
After the Republic of Cuba was established and the Cuban Con-'
gress assembled the provisions of the constitution above referred to
and the other provisions of the appendix were included in a treaty
with the United States which was duly celebrated by and with the
concurrence of the Cuban Congress and the treaty-making powers of
the United States. Thereby the United States accepted the powers
conferred by the Cuban constitution and became bound to discharge
the obligation. The revolution of 1906 furnished an occasion for
the officials of. the Government of Cuba, charged with the responsi
bilities of place and power, to call xipon the United States to perform
the obligation and exercise the authority conferred and accepted as
above described. The President of the Republic of Cuba called upon
the President of the United States for the performance of the treaty
obligation. The United States responded. President Estrada Palma,
Vice-President Mendez Capote, and all the cabinet resigned and the
Congress dispersed. Manifestly the first thing to be done was to pro
vide for the administration of the affairs of government and thereby
maintain the existence of the Cuban Government until the vacancies
occasioned by the resignations could be filled. The attempt was
made to fill these vacancies by the action of the Cuban Congress, but
a quorum could not be secured. The affairs of government must be
administered, and therefore a provisional administration was estab
lished. The Government was not changed, but continued in full
force and vigor, exercising the same sovereignty and maintaining
complete independence. There is in Cuba a provisional administra
tion, but the Government continues to be that of the independent
sovereignty of the Republic of Cuba.
The character and scope of the provisional government was set
forth in the proclamation of Secretary Taft, by which it was estab
lished :
To 11\e People of Cuba:
The failure of Congress to act on the irrevocable resignation of the Presi
dent of the Republic of Cuba or to elect a successor leaves this country without
a government at a time when great disorder prevails, and requires that, pur
suant to a request of President Palma, the necessary steps be taken in the name
and by the authority of the President of the United States to restore order, pro
tect life and property in the island of Cuba and islands and keys adjacent
thereto, and for this purpose to establish therein a provisional government.
The provisional government hereby established by direction and in the name
of the President of the United States will be maintained only long enough to

restore order and peace and public confidence, and then to hold such elections
as may be necessary to determine those persons upon whom the permanent Gov
ernment of the Republic should be devolved.
In so far as is consistent with the nature of a provisional government, estab
lished under authority of the United States, this will be a Cuban government,
conforming, as far as may be, to the constitution of Cuba. The Cuban flag will
be hoisted as usual over the Government buildings of the island. All the execu
tive departments and the provincial and municipal governments, including that
of the city of Habana, will continue to be administered as under the Cuban
Republic. The courts will continue to administer justice, and all laws not in
their nature inapplicable by reason of the temporary and emergent character of
the Government will be in force.
President Roosevelt has been most anxious to bring about peace under the
constitutional Government of Cuba, and has made every endeavor to avoid the
present step. Longer delay, however, would be dangerous.
In view of the resignation of the cabinet, until further notice the heads of all
departments of the central government will report to me for instructions, in
cluding Maj. Gen. Alejandro Rodriguez, in command of the Rural Guard and
. other regular Government forces, and Gen. Carlos Roloff, treasurer of Cuba.
Until further notice the civil governors and alcaldes will also report to me for
instructions. I ask all citizens and residents of Cuba to assist in the work of restoring
order, tranquillity, and public confidence.
Wm. H. Taft,
Secretary of ~\\'ar of the United States,
Provisional Governor of Cuba.
Habana, September 29, 1906.
The greater portion of the affairs with which the provisional
administration was called upon to deal can be conveniently grouped
as political, economic, legislative, miscellaneous, and administrative.
POLITICAL CONDITION.
CAUSE OF REVOLUTION.
During the administration of President Palma there were three
political parties, the Moderate party (at first called Republican
party), the National party, and a small Independent Radical party.
Each of these parties was composed, in large part, of groups with
recognized leaders ; that is to say, the personal following of a natural
leader. For a little more than three years President Palma declined
to affiliate with either of these parties and endeavored to distribute
the patronage and governmental benefits equally, or ratably, between
them. The contest between these parties for political supremacy
became intense. There was an especial effort on the part of each one
to control the Cuban Congress and this rivalry made it difficult to
secure legislative action, even as to much needed legislation.
The constitution of the Republic of Cuba requires that not only on
the assembling of Congress, but at the opening of the daily sessions,

8
there must be an attendance of at least two-thirds of the total mem
bership. No measure for compelling the attendance of the members
of Congress had been provided, and therefore it was easy to prevent
a quorum. In securing a remedy for this evil, President Palma de
termined to affiiliate with the Moderate party, hoping, with the aid of
the powers of the Executive branch of the Government, to secure
two-thirds or more of the Congress who could be relied upon to enact
laws and measures which he deemed essential or advantageous. The
Nationals then coalesced with a number of disaffected Moderates
and formed the Liberal party, which was also joined by the former
Radicals. Several National leaders, however, refused to enter the
combination, but maintained independent organizations, retaining
the old name of " Nationals." Upon President Palma's affiliation
•with the Moderate party, the policy was adopted of displacing Lib
erals from official positions — national, provincial, and municipal —
throughout the island, filling their places with members of the Mod
erate party. This embittered the opposition to the Administration.
When the time for elections approached the Liberals made nomina
tions for all the offices and enterer upon a vigorous campaign. The
Independent Nationals favored the reelection of President Palma,
and locally combined with the Moderates. All the powers of the
Executive branch of the Government were utilized to secure the suc
cess of the Moderate party in the national, provincial, and municipal
¦elections, and measures were taken of such kind and character as to
create a belief in the minds of a large number of the electors that the
laws had been violated, the constitution subverted, the rights of citi
zens invaded, and the character of the Government changed ; in other
words, that recourse had been had to unlawful exercise of power and
perpetration of gross injustice to such an extent as to vitiate the
elections. This belief led to the revolution, and the investigation
of the Peace Commission established that the belief was well founded.
INTERVENTION  PROVISIONAL ADMINISTRATION ESTABLISHED.
The inability of the Administration to successfully cope with the
revolution induced President Palma to invoke the exercise by the
United States of the powers conferred upon that Government by
article 3 of the appendix to the Cuban constitution and accepted by
the United States and confirmed by the Republic of Cuba by the
treaty between the two Governments. In response to the call of the
President of the Republic of Cuba and pursuant to said treaty obli
gation, the President of the United States created a Peace Commis
sion, composed of Hon. William H. Taft, Secretary of War, and Hon.
Robert Bacon, Assistant Secretary of State, and sent them to Cuba
to investigate the situation and attempt to restore peace and reestab
lish law and order. Upon the arrival of the Commission in Cuba the

President of the Republic communicated to them his intention to re
sign his office. The members of the cabinet tendered their resigna
tions to President Palma, and the same were accepted by him. The
President sent his resignation to the Cuban Congress, then assembled
in Habana. The vice-president also resigned. The Congress dis
solved without filling either vacancy. Thereupon, the President of
the United States, by virtue of the authority conferred by the Cuban
constitution and the existing treaty between Cuba and the United
States, appointed Hon. William H. Taft provisional governor of the
Republic, thereby insuring the maintenance of constitutional govern
ment, international relations, and a means of preserving law and
order. The Peace Commission, during the course of its investigation, de
termined upon ways and means for settling the existing controversies
between the several factions into which the people were divided.
These terms and conditions were embodied in a letter to President
Palma and were also submitted to the national committees of each
of the three important political organizations. President Palma
»and the Moderate party declined to accept the conditions; the Inde
pendent National party approved of the general plan proposed, but
requested certain modifications ; and the Liberal party accepted the
proposal without modification.
The plan of the Peace Commission was as follows:
First. The resignation of the vice-president, all the senators and repres"iit-
atives, governors, and provincial councilors, elected December, 1905.
Second. The laying down of the arms of the insurgents on the signing of
this compromise and the presentation of these resignations.
Third. The provision by law for a commission to consist of three lawyers
whose names were to be selected by the Moderate party, three to be selected
by the Liberal party, and one by the President of the United States, for the
purpose of drafting laws.
Fourth. The holding of elections on January 1, 1907, under the provisions
of the electoral law drafted by such commission.
On the 6th day of October, 1906, the President of the United States
designated the writer as provisional governor of the Republic of Cuba
and directed him to proceed to Cuba and assume the duties of said
office. Pursuant thereto the writer was inducted into office on the
13th day of October, 1906, and issued the following proclamation :
Acting upon the authority conferred upon him by the appendix to the consti
tution of Cuba, by the treaty between the United States and Cuba ratified July
1, 1904, and by the act of Congress of the United States approved March 2, 1901,
the President of the United States has appointed me provisional governor of
Cuba, to succeed the Hon. William H. Tat't. and I hereby assume that ofBce.
The policy declared and the assurances given by my predecessor, Secretary
Taft, will be strictly adhered to and carried out.
As provisional governor, I shall exercise the powers and perform the duties
contemplated and provided for by the third article of the appendix to the con-

10
stitution of Cuba, for the preservation of Cuban independence and for the pro
tection of life, property, and individual liberty.
As soon as it shall prove to be consistent with the attainment of these ends
I shall seek to bring about the restoration of the ordinary agencies and methods
of government under the other and general provisions of the Cuban constitution.
All provisions of the constitution and laws the application of which for the
time being would be inconsistent with the exercise of the powers provided for
by the third article of the appendix must be deemed to be in abeyance. All
other provisions of the constitution aud laws continue in full force and effect.
ELECTIONS — ELECTION FRAUDS.
Prior to the departure of Secretaries Taft and Bacon from Cuba
a question arose as to the advisability of holding the elections at the
time set forth in the plan of settlement. Conferences were held with
the leaders of the political organizations and many other prominent
and influential citizens, and by common consent and agreement it was
decided to postpone said elections until the close of the season in
which the tobacco and sugar-cane crops are harvested. This post
ponement, by mutual agreement, insured the peace and tranquillity
of the island during the harvest season and afforded the provisional
administration opportunity to investigate the numerous charges made
by the Liberals and the revolutionary committee as to the improper
exercise of the powers of the executive branch of the Palma Admin
istration, Avhereby that administration sought to perpetuate itself in
place and power.
These charges, in general, were that the municipal officials in many
municipalities having a Liberal majority had been displaced and sub
stituted by Moderates; that members of the Liberal party were ex
cluded from practically all of the appointive offices of the Govern
ment, and that the Rural Guard had been converted into a political
agency for accomplishing the purposes of the Moderate party.
The Peace Commission determined that the Liberal party was en
titled to and should receive equitable representation in the public
service of the national government. The Liberals desired and re
quested that a sufficient number of Moderates should be displaced and
Iheir places filled by Liberals to secure such representation imme
diately. The Peace Commission rejected this suggestion and, instead,
adopted the policy of appointing Liberals to fill vacancies as they
occurred. The Peace Commission concluded its labors and Secretary Taft re
tired from office of provisional governor at noon October 13, 1906,
and on the afternoon of the same day embarked for the United States.
The people of Habana forgot their political differences, and taking-
thought of the fact that the horrors of civil war had been averted
all parties joined in a demonstration of gratitude and praise for the

11
work that had been accomplished. The shore of the bay was lined
with thousands of cheering people, all available water craft was
pressed into service to escort the ships to the mouth of the harbor, the
forts exchanged salutes with the vessels, and amid cheers and all pos
sible display of good will the Peace Commission concluded its labors.
The character and extent of their service is shown by the resolution
adopted by. a mass meeting of the American residents of Habana, as
follows :
Gentlemen: The American residents in Cuba, temporarily organized for the
purpose of making known to you their situation and necessities in connection
with the recent disturbances, desire to express to you their high appreciation
of the great services your wise and prudent measures have secured to them
and to all the people of Cuba.
The results you have accomplished are greater than could have reasonably
been hoped for at the time of your arrival. Nearly 30,000 armed men, moved
by the most intense and bitter passions, were then arrayed against the armed
forces of the Government and a disastrous conflict was imminent, in which
enormous loss of life- and property would have been inevitable. It scarcely
seemed possible that these angry elements of discord and strife could be brought
into peaceful and orderly citizenship without bringing into active service -the
military power at your command to compel a cessation of the struggle for
supremacy between the contending forces. But in less thau one month the
wise and sagacious methods you pursued and the skill aud adroitness with which
you approached the difficult task committed to your charge have brought peace
and quiet to Cuba. Warlike conditions have vauished, with no immediate prob
ability of their resumption. The armed forces have surrendered their arms
and most of them are already in their fields and shops engaged in peaceful
industry. Not the least satisfactory to the considerations involved is the fact that in
the settlement of the turbulent conditions that prevailed you have caused but
little irritation or resentment, and have secured from the Cuban people in
creased respect and regard for the United States and greater confidence and
trust in the good will and wishes of the American people for the people of Cuba
and their future welfare.
We do not believe that so successful and speedy an achievement under con
ditions so difficult and dangerous has any parallel. And the thanks and grati
tude of the people of Cuba, as well as of the great people you represent, are due
to you for these inestimable services.
Wishing you a safe return to the United States and the enjoyment of higher
honors in the future, we are,
Sincerely yours, S. S. Harvey,
H. E. Havens,
Wm. Hughes,
H. W. Baker,
Dr. C. Clifford Ryder,
Alfred Liscomb,
W. Roberts,
Wm. B. Hine,
J. E. Barlow,
Chas. Hasbrook,
Committee.

12
The complete success of the Peace Commission has now become a
matter of history, and in the interests of history I insert a letter writ
ten by President Palma to a personal friend on October 10, 1906.
This letter was published recently in the newspapers of Habana, and
is as follows:
My very esteemed friend: I dictate these lines impelled by a sentiment
which elevates and makes happy— the sentiment of gratitude. Tljis sentiment
is strong within me when I read your letter of the 6th. In the unbalanced
state of society in Cuba to-day and in the midst of the confused noise of a low
mob, it is pleasant and strengthening to receive testimony of approval and sym
pathy from superior spirits who are capable of comprehending acts of abnega
tion and disinterest, inspired by the purest love of country. In complying with
my public and private duties, especially on difficult occasions, I have never
evaded the grave responsibilities imposed on me by circumstances. I have as
sumed them without vacillation with the courage and resolution of a clear
conscience, foreign to any personal interest, and moved only by a sensible,
upright, and true patriotism. Let those who willfully hide the reality of
matters to themselves join in censurable chorus with the ignorant, boastfully
clamoring of patriotism. I am satisfied with the conviction of having saved
my beloved country from a horrible demoralization, of having saved it from
ana-rchy and its necessary concomitants, ruin and pillage.
From the first days of the insurrectionary movement I understood the situa
tion and was able to appreciate it with a serene mind. I saw before me numer
ous masses tired of the order and legality to which they appeared to have
submitted during the four years of the Republic ; eager for license and forays,
follow like a mob the first adventurer who invited them to rise; I saw every
where persons who sympathized with disorder and encouraged disturbance; I
gaw the press in the morning, afternoon, and at all hours assisting with un
paralleled cynicism the secret conspiracy organized in behalf of the rebels; I
suddenly found myself in the midst of a tremendous social disorganization, with
thousands of insurgents in three provinces and the menace of rebellion in two
others, without sufficient regular forces to undertake immediately an active
campaign against the former and to beat and disorganize them ; at the same
time I constantly feared that they' would carry to the great sugar plantations of
Santa Clara the measures of destruction already realized on railroad stations,
locomotives, bridges, culverts, etc. ; I saw the customs revenues fall off by one-
half and the other income of the State to 25 or 30 per cent, and that the millions
of the treasury were being spent in streams with- uncertain result and to very-
doubtful advantage, a large part being used for keeping up hastily improvised
militia, which for that very reason could not inspire sufficient confidence as to
their reliability for undertaking the labor, the privations, and the dangers of a
constant persecution of adversaries, who were also Cubans and in a great num
ber of cases friends and comrades. In the meantime, like a preconceived slo
gan, there resounded day after day in all quarters the threatening demand for
" Peace at any cost," with the tendency of obliging the Government to submit to
whatever humiliation might be required, nor did anyone stop to think how im
possible the realization of the conditions was in practice, or consider the serious
consequences of such a course in the future. To these reflections I might add
'• other unfavorable circumstances of great seriousness " as to which, neverthe
less, I must remain silent because of their personal nature.
The situation therefore, fronf the Cuban standpoint, presented the followin"
dilemma : On the one hand the necessity of putting down the insurrection by
force of arms; on the other that of making a compact with the insurgents.

13
It is easy to express the first course in a few words, but its complete realiza
tion was a diflicult matter, as may be judged from what I ha\ e said uDove. At
all events it would have required a period of several months, great effusion of
blood, loss of life, destruction of property, and the consumption of the millions
put aside for works of public utility, only to leave deeply rooted in the country
the hatred caused by civil war. ready to break out again whenever a favorable
opportunity arose. My humane sentiments of Christian civilization, the attach
ment I had for the economies which had been accumulated in the treasury by
resisting the opposite tendency of improvident legislators, and the importance
of protecting lives and property of Cubans and foreigners during the armed
struggle made me reject this course, which was further subject to having the
Washington Government, already preparing forces in the south of the United
States, believe at any moment that it was time to intervene.
The course of making a pact with the insurgents in arms was the worst which
could be considered. Even .supposing that the different rebel leaders and the
directors and instigators of the movement arrived at an understanding among
themselves and that they agreed with the Government upon the fundamental
bases for terms of settlement, the secondary problems which would afterwards
arise would be so many and so difficult to decide, in view of the weakened if
not lost moral force of the legitimate authorities and in the absence of other
authority that might settle differences, these problems would, I repeat, be so
many and so difficult that they would cause the country to remain for many
months in constant agitation, with results as pernicious as war itself. From the
moment the Government treated with the rebels it placed itself on an inclined
plane of interminable concessions, initiating an era of successive insurrections,
and putting the stability of future governments on a frail basis. I could never
consent to be an accomplice in such evil in exchange for being permitted to
continue to occupy the Presidential chair of the Republic, humiliated and its
prestige taken away by the requirements of the insurrection, and in a situation
in which it would have been impossible for me to give my country the services
which my high and disinterested aspirations desired.
No, by no means, neither one course nor the other in the dilemma ; neither
answer war with war, nor degrade my authority as the legitimate chief of State
and my personal dignity by submitting to the exactions of armed men, lacking
all social prestige, lacking principles and ideals, the instruments of a number
of ambitious men without pity who were astute enough to remain aloof while
they sent forth against the defenseless community those ignorant masses ready
for pillage and disorder.
When I saw the insurrection take serious proportions my soul was overcome
with profound disenchantment, contemplating the patient and glorious work of
four years overthrown; and I irrevocably resolved to resign the presidency, to
completely abandon public life, and to seek in the bosom of my family the cer
tain refuge against so many deceptions. But before carrying out this intention,
so grateful to my desires, it was absolutely necessary to make a last sacrifice on
the altar of my country. It was not possible that I leave the Government in
criminal hands ; in the hands of those who had dealt a fatal blow to the credit
of the Republic and the good name of the Cuban people. The conscience of a
superior duty (one of those duties which cause the heart to bleed and give rise
to unpopularity and hate) imposed upon me as the only measure of salvation,
the necessity of acquainting the Washington Government with the true situ
ation of the country and with the lack of means of my Government to give pro
tection to property, and to say that I considered that an occasion had arisen for
the United States to make use of the right granted them by the Piatt amend
ment. I did so, cpnsulting few people, since it was not a time to expose myself

14
to contradiction in order to seek partners in this responsibility, but to assume
the responsibility entirely, with the firmness of a legitimate conviction and the
courage which always accompanies acts inspired in the most sterling patriotism.
Whether I did well or not time will decide. Meanwhile my attitude is justi
fied by my decree of September 17, which virtually put an end to the war, ex
actly one month after it had begun, thus avoiding further bloodshed and loss of
life ; it is also justified by the fact that the insurgents are already disarmed and
returning to their homes, tranquillity having been reestablished, guaranteed by
the moral and material force of American authority. Ordinary occupations
may be followed once more without fear, and it is to be supposed that the next
sugar and tobacco crops will begin to restore economic prosperity, impaired by
the crisis. As to polities, I venture to predict nothing, neither as regards the
parties nor as to the probable result of the intervention.
I have always believed since the time I took active part in the ten years' war
that independence was not the final goal of all our noble and patriotic aspira
tions. The aim was to possess a stable government, capable of protecting lives
and property and of guaranteeing to all residents of the country, natives and
foreigners, the exercise of natural and civil rights, without permitting liberty
ever to become pernicious license or violent agitation, to say nothing of armed
disturbances of public order. I have never feared to admit, nor am I afraid
to say aloud, that a political dependence which assures us the fecund boons of
liberty is a hundred times preferable for our beloved Cuba to a sovereign and
independent republic discredited and made miserable by the baneful action of
periodic civil wars. T. Estrada Palma.
It required but slight investigation to see that the principal imme
diate cause of the uprising against President Palma's administration
was the interference with the municipalities. One of the keenest
and best qualified observers of Cuban affairs stated :
That the Government could have done anything it saw fit to do in Habana,
but the attempt to convert Liberal municipalities into Moderate ones was a
fatal error.
The Liberal committee was called upon to state which munici
palities had been illegally interfered with and submit proof. They
submitted a list as follows, including therein several municipalities
whose authorities had been changed during the uprising on account
of sympathy with the insurgents :
Pinar Del Rio Province. — Guane, San Juan y Martinez, San Luis, Conso-
lacion del Sur, Artemisa, Guanajay, Cabanas, and Vinales.
Habana Province. — Habana, Marianao, Guines, Batabano, Aguacate, Alquizar,
and Guanabacoa.
Santa Clara Province. — Camajuani, Vueltas, Placetas, Yaguajay, Cala-
bazar, Trinidad, Cienfuegos, Rodas, Lajas, Ranchuelo, Sagua la Grande,
Santo Domingo, Cruces, Palmira, Caibarien, Rancho Veloz, and Sancti Spiritus.
The committee stated that there were other municipalities in the
Republic in which a majority of the inhabitants were Liberals and
in which the officials should be members of that party, but that the
displacements had been accomplished in such manner as made it
difficult, if not impossible, to present sufficient proof to justify action

on the part of the provisional administration; therefore, their names
were withheld.
Investigation was made as to the municipalities whose names were
presented. Each case was disposed of on its own merits. As to
many of them, the charges made by the Liberals were admitted; as
to others, evidence was adduced. Liberal administrations were re
established, in whole or in part, in the following municipalities :
Pinar del Rio Province. — Guane, San Juan y Martinez, Consolacion del Sur,
and Guauajay.
Habana Province. — Guines, Aguacate, Alquizar, and Guanabacoa.
Santa Clara Province. — Camajuani, Vueltas, Placetas, Xaguajay, Calabazar,
Trinidad. Cieufuegos, Rodas, Lajas, Ranchuelo, Cruces, Palmira, Rancho Veloz,
and Sancti Spiritus.
The action of the provisional administration in these cases was gen
erally approved and universally accepted without protest or com
plaint. CREATION OF LIBERAL COMMITTEE.
The matter of appointing Liberals to positions in the National
Government was one that bid fair to give the provisional adminis
tration considerable difficulty. Party ties set lightly on individuals
in Cuba. There are few, if any, issues involving national policy or
political principles. The individual voter gives allegiance to the
party which, at the time, suits his inclination, and easily passes from
one party to the other — a man may be a Liberal one month and a
Moderate the next, or vice versa, being governed by the personality
of the candidate or the local leaders supporting a candidate. The
revolution of 1906 had many adherents who, at different times,
belonged to the Moderate and Independent parties, but had from one
cause or another joined the opposition to the Palma administration.
It was a practical impossibility for the provisional governor to deter
mine what persons were representative of the class which had been
excluded from office, or whose appointments would assist in restoring
equitable representation. The provisional governor was a stranger
to the country and people, and without the necessary knowledge.
Ordinarily the requisite information would be supplied by the mem
bers of the cabinet, but Secretary Taft had ordered that the chief
clerks of the departments should be the acting secretaries, and, as
they were either Moderates or Independents, the Liberals protested
against their being allowed to designate the Liberal representation.
From this situation there developed the proposal that the committee
which had dealt with Secretary -Taft in his successful endeavor to
secure the disbandment of the revolutionary forces and the restora
tion of tranquillity should propose to the provisional governor the
names, of the persons to fill vacancies, as from time to time they

16
occurred. This plan gave promise of securing the desired result, for
the committee represented not only the Liberal party, but also other
elements which constituted the opposition and the excluded classes.
The plan was adopted and proved satisfactory. The committee, as
originally constituted, was composed of the following gentlemen:
Faustino Guerra, president; Eduardo Guzman, vice-president; Er
nesto Asbert, secretary; Alfredo Zayas, Jose Miguel Gomez, Juan
Gualberto Gomez, Tomas Recio, Demetrio Castillo Duany, Jose de J.
Monteagudo, and Carlos Garcia Velez.
The creation of this committee saved the provisional government
much time and trouble and secured appointees who, with very few
exceptions, proved efficient and generally acceptable to the public.
The announcement was made from the first that officials would not be
removed to make way for Liberals. This was reluctantly accepted
by the Liberals, being acquiesced in as convenient, if not essential,
to the provisional administration. In this, as in all other matters, the
Liberal party has shown a purpose and desire to aid and assist the
provisional administration in carrying out the plan adopted by the
Peace Commission, and in securing an honest and efficient administra
tion, and in other ways promoting the success of the endeavor in
which the provisional administration is engaged. The Moderate and
Independent parties, having practically dissolved, were unable as a
party to assist the provisional administration, but individually
many of the members called and offered their aid and assistance.
When the Conservative party was organized, a committee from that
party called and offered their assistance unconditionally to the pro
visional government and have been of great help.
RURAL GUARD.
Investigation of the charge that the Rural Guard had been used as
a political agency by the Government showed the charge to be true.
Justice to the Rural Guard, however, requires that the statement be
made that this service was contrary to the desire of a large majority
of the officers and enlisted men. I am convinced that the service was
distasteful and was performed under protest and against their judg
ment and desire. There may have been a few who thought the ends
justified the means, but by far the greater number considered it a dis
agreeable service which they were constrained to perform because it
was imposed upon them by the obligation of military service. The
purpose of the Rural Guard is indicated by its name, and the field .of
their operation was intended to be' outside of the municipal zones or
inhabited portions of the municipalities (towns). Within the mu
nicipal zone the municipal police should have exercised the police
powers. For various reasons — among them the small number of po-

17
licemen, inefficiency resulting from political appointments, etc., but
largely because of the political influence which they might exercise —
the Rural Guard gradually supplanted the municipal police within
the municipal zones. This unwarranted exercise of police author
ity by the Rural Guard in all localities throughout the island
brought the guard into disfavor. The Rural Guard force was not
sufficient to police the towns and rural districts and the rural districts
were largely neglected. This added to the disfavor of the guard and
in no small measure afforded the opportunity for fomenting revolu
tionary sentiment and the assembling of insurgent bands which,
when joined together, constituted the revolutionary forces.
The operation of the Rural Guard against the insurgents was
greatly hampered by the desire of the Government to afford ade
quate protection to the towns, especially the city of Habana, and, if
possible, to avoid armed conflict, with resulting loss of life, and arous
ing of passion and animosities which battles engender. This resulted
in a loss of prestige which was keenly felt by the guard and, at that
time, the esprit de corps was at a low ebb and danger of further de
moralization existed. In addition to using the guard as a political
agency, the Government had also made numerous promotions in the
service as reward for political activity or because of political influ
ence. On the whole the guard was in a bad way.
The Rural Guard was organized under the military government
of Cuba established by the United States at the close of the Spanish-
American war. The officer in charge of the organization at that time
was Maj. Herbert J. Slocum, then in the Seventh Cavalry, U. S.
Army. Major Slocum was detailed for service with the provisional
administration and assigned to duty as adviser to Maj. Gen. Ale
jandro Rodriguez, commanding the armed forces of Cuba. He
requested and received the assistance of Maj. Henry A. Barber, U. S.
Army (retired), and Capts. Powell Clayton, jr., Eleventh Cavalry;
George C. Barnhardt, Fifteenth Cavalry; Andrew J. Dougherty,
Thirtieth Infantry, and Edmund Wittenmyer, Fifth Infantry. These
officers entered upon the work of reorganizing and restoring the
guard to its original efficiency.
The Rural Guard consists of three regiments with headquarters at
Habana, Matanzas, and Santiago. Each regiment is charged with
policing two provinces. Capt. Powell Clayton was detailed as ad
viser to Col. Emilio Avalos, commanding the First Regiment, which
is charged with policing Habana and Pinar del Rio provinces, with
headquarters at Habana ; Capt. Edmund Wittenmyer was detailed as
adviser to Col. Manuel Antonio Martinez, commanding the Second
Regiment, with headquarters at Matanzas, and charged with policing
the provinces of Matanzas and Santa Clara; and Capt. Andrew J.
Dougherty was detailed as adviser to Col. Saturnino Lora, command-
23706—08  2 ]

18
ing the Third Regiment, charged with policing Camaguey and
Oriente provinces, with headquarters at Santiago.
The officers of the United States Army detailed for duty with the
Rural Guard are performing excellent service. All of them entered
upon the discharge of their duties with enthusiasm and confidence of
speedy success. The Rural Guard, from the commanding general to
the latest recruit, are eager for the necessary reforms, and I record
with much gratification that they have already attained a high degree
of efficiency ; that promotion is no longer secured by political activity
or influence; that they refrain from exercising police power within
the municipal zones excepting when called upon by proper authority ;
that they refrain from political activity and, with a few exceptions,
manifest no desire to engage therein; and that they have regained
the confidence and good will of the general public.
SUSPENSION OF CONGRESS  EXERCISE OF LEGISLATIVE POWERS BY PRO
VISIONAL GOVERNOR.
The Peace Commission found that the Congressional elections of
1905 were so tainted with fraud as to render them illegal. This elec
tion involved one-half of the members of the Senate and National
Assembly, and upon the elections being declared void no quorum ex
isted. Thereupon Secretary Taft issued a decree suspending the
meetings of the Congress and providing that the legislative powers
should be exercised by the provisional governor. The exercise of
legislative power by the Chief Executive of the Republic is in har
mony with the established order prevailing in Cuba.
ENACTMENT OF LAWS IN ORDER TO MAJSE CONSTITUTION EFFECTIVE.
When the constitution of Cuba was adopted, it was recognized that
many of its provisions were opposed to the existing laws ; and many
other provisions required legislation to render them effective. To
meet this situation and tide over the period between the establishment
of the Republic and the enactment by Congress of the necessary
legislation there were adopted certain " transitory rules " by which
the old laws were continued in force, in so far as they did not conflict
with the constitution, until amended or repealed by Congress and new
legislation substituted. In construing these rules the supreme court
has held that the Chief Executive may exercise the authority there
tofore possessed and exercised by the Spanish governors-general.
Under the Spanish regime the decree of the governor-general had the
force and effect of legislative enactment and, under the authority of
said transitory rules and article 68 of the constitution, which em
powers the President to issue regulations for the better enforcement
of the laws and decrees for the administration of the country, Presi
dent Palma continued to issue decrees having like force and effect

19

ADVISORY LAW COMMISSION.
The plan approved by the Peace Commission called for the enact
ment of four special laws, to wit :
1. A municipal law embodying the requirements of the constitution.
2. An electoral law containing sufficient provisions to secure a representa
tion by the minority and providing for the conduct of elections under a non
partisan bureau of elections having charge of police during the election and
registration period, as well as the registration, counting of the votes, and de
claring the result.
3. A law providing for the reorganization and increased independence of the
Judiciary. 4. A civil-service law.
A revision of the provincial law was also deemed necessary. Al
though the laws of all countries on these subjects bear a general
resemblance, it is necessary that said laws should conform to national
characteristics, local conditions, public desires, and public exigencies.
The study of these requires time and a knowledge of the conditions
to be met.
A commission similar to that contemplated by the plan of the Peace
Commission was appointed December 24, 1906; it is known as the
" advisory law commission " and is composed of the following gentle
men: Col. E. H. Crowder, U. S. Army, president; Drs. Erasmo
Regiieiferos Boudet, Manuel Maria Coronado, Francisco Carrera
Justiz, Mario Garcia Kohley, Rafael Montoro, Felipe Gonzalez Sar-
rain, Miguel F. Vondi, Alfredo Zayas, Mr. Otto Schoenrich, Mr.
Juan Gualberto Gomez, and Maj. Blanton C. Winship, judge-advo
cate, U. S. Army.
This commission entered upon its work at once. The field of in
vestigation proved larger than was anticipated, and more time has
been consumed than originally intended. The commission has given
the task great care and attention and has exhibited ability, care,
thoughtfulness, and comprehension of subject-matter. The time em
ployed by it has been well spent. Its work is rapidly approach
ing completion. The municipal law and the electoral law are prac
tically finished. Although not officially reported to the provisional
governor, they have been examined by him, and he feels assured they
are admirably adapted to the purposes for which they are intended.
The judiciary law is also practically ready. These laws will be
printed in pamphlet form and given extensive circulation in order
that their provisions may be examined and considered by the in
habitants of Cuba prior to giving them force and effect. T'here is
every reason to believe that the laws so formulated will become an
important and potential part of the permanent legislation of the
Republic.

20
Where all have done so well it might seem inadvisable to single
out one for special mention and commendation, but in this instance
every other member of the commission will be gratified by special
mention and commendation of the work and ability of Col. E. H.
Crowder, U. S. Army, president. It was especially advantageous
that his services were available for the provisional administration.
In addition to exceptional legal ability and training, he served as
legal adviser to the military governor of the Philippine Islands, and
while serving in that capacity drafted many new laws and reformed
many old ones which have become part of the permanent legislation
of the islands. This experience is of great value in the work of the
advisory law commission. The members of the commission promptly
recognized his ability and the value of his judgment ; and the special
study which he gave to the constitution and existing laws of Cuba in
creased his efficiency and enabled him to reconcile existing differences
of preconceived opinions, and therefore it is just to attribute to him
a large share of the credit for the excellent results the commission has
attained. POSTPONEMENT OF ELECTIONS  REGISTRATION OF VOTERS.
The harvest of the sugar and tobacco crops in Cuba is completed,
usually, about the middle of May. As that season approached in
1907 it became evident that the advisory law commission would not
complete the draft of the laws upon which it was working within
the time calculated. The municipal law and the electoral law are in
dispensable requisites to the elections. It is necessary, also, before
holding these elections to have a new registration of voters, for it
is commonly known and conceded that the existing registration lists
are erroneous — lacking the names of many qualified electors and con
taining the names of unqualified or nonexisting persons. The present
registration law contemplates that the electors will register volun
tarily, or that the representatives of a party will submit a list of the
qualified electors belonging to their party to the registration board,
whereupon, either by virtue of actual knowledge of the board, or upon
evidence submitted by the political managers, the names are entered
in the registration books. This system, although in common use in
Central and South American States seldom secures either a full or
accurate registration. The ordinary voter, especially in rural dis
tricts, is seldom willing to take the trouble to present himself for
registration and the lists presented by the partisan committees are
usually inaccurate and incomplete. It is a common practice for all
parties to submit a long list of names and preserve or secure a copy
of those accepted, and at elections call upon their partisans to vote
under the names entered in the register. When it was known that the

21
provisional administration contemplated a registration in accordance
with the old law, objections were made on all sides and the advisory
law commission addressed a letter to the provisional governor urging
that a census of the island be taken, and that from the census list a
new registration list be compiled. This plan met with universal
commendation and was adopted. In April, 1907, Secretary Taft
again visited Cuba. Among other matters which received his at
tention at this visit was that of fixing the dates for the forthcoming
elections. In conference with him, the national committees of the
several parties agreed that it was inexpedient to hold the elections at
the time then contemplated. The results of these conferences with
these committees and other representative bodies, were embodied in
a letter written by Secretary Taft to the provisional governor, as
follows :
After having conferred with the committees of the Liberal, Conservative, and
Republican parties, and with the leading men of the community, including
lawyers, bankers, business men, representatives of the chamber of commerce
and others, and after a full discussion of the situation with you, General Barry,
and Consnl-General Steinhart, I have made the following statement and recom
mendation to the President :
Having in view the circumstances making the intervention necessary, and
the purpose of that intervention, the condition of Cuba and the attitude of its
people under your administration are very satisfactory. The question now
arising is, When shall the elections be held? The advisory law commission
appointed to draft an electoral law, a municipal law, a judiciary law and a civil-
service law, and composed of 3 Americans, 4 Liberals and 4 Conservatives, have
declared to me that no fair election in Cuba can be held until after the taking
of a census for the purpose of enumerating with exactness and justice the
residents of each town with a view to the verification of the registry upon
which the election is to take place, and this view has been enforced by the
assurances of all the political parties. All parties, through their committees,
have expressed the view that the wisest course is to hold a preliminary election
to test the electoral law and to test the tranquillity of the country. The
Liberal party urge that this election shall be for municipal officers and for
provincial officers, while the Conservative party insists that it ought to be
limited to municipal officers ; but they agree in recommending the holding of
a preliminary election. The Liberal party expresses the view that the census
can be completed in four months and that the provincial and municipal elec
tions may therefore be held in September. The Conservative party does not
express an opinion as to the time in which the census can be taken, but insists
that the census should be taken with great care and the registration lists
founded on it should be subjected to severe and impartial judicial scrutiny as
proposed by the advisory commission, and that the preliminary election shall
be held a reasonable time after the completion of the census. The Liberal
party, hoping that the preliminary election may take place in September,
recommends that the presidential and congressional elections be held the 31st
of December, next, that the regular constitutional period shall elapse there
after before the assembling of the electoral colleges to name the senators and
the President, members for which are elected at the general election. By the
constitution these electoral colleges do not convene until one hundred days
after the general election. The Liberal party suggests that the new congress

22
shall meet to receive the vote of the election for the President in time to permit
his inauguration on the 20th of May, 1908, that date being the anniversary of
the day upon which the first President of the Republic was inaugurated.
The Conservative party insists that the preliminary election is in the nature
of an experiment and that three months is not a sufficient interval to determine
whether the experiment has been a success, and recommends that not less than
six months should elapse between the preliminary election and the presidential
and congressional elections.
First. It is hardly necessary to reiterate that the position of President Roose
velt is exactly what iirwas when the first proclamation was issued establishing
a provisional government under the Piatt amendment in this island, to wit : That
Cuba must be turned over to a Cuban government fairly elected as soon as the
conditions and the tranquillity of the country will permit and will assure the
stability of the government to be established.
Second. I do not think that four months is a sufficient time in which to take
such a census as is necessary to assure a fair basis for holding an election. It
would be most unwise, therefore, to fix a definite date for the holding of a pre
liminary election. All that can be done, and all that ought to be done, is to
declare that a census will be taken in as short a time as is consistent with
making the census thorough, fair, and complete for electoral purposes, and to
announce that the preliminary election will be held within such period there
after as may afford a reasonable time for complying with all the requirements
of the new electoral law preceding the elections.
Third. The municipal and provincial elections, which are in a sense local
elections, should be held at the same time. I have already expressed the
opinion that the election by which the present provincial authorities were put
into power was attended with such irregularity that their resignations should
be at the service of the Government, although present conditions justify the
maintenance of the de facto status of these officials so long as they conduct them
selves properly, rather than an indiscriminate removal of them with the possible
excitement and controversy likely to attend the selection of their successors.
Still the question of the proper policy to pursue in respect to the present pro
vincial officers is a matter which is in your hands for decision. But it is certain
that as soon as the present condition as to provincial officers can be cured by
an election that that election should be held, and therefore that both the munici
pal officers and the provincial officers should be selected at the preliminary elec
tion. It is true that at the provincial election provincial councilmen are to be
selected who by law will constitute one-third of the electoral college to vote for
senators, but at the national elections there will be selected two-thirds of that
same college, and therefore the selection of the provincial council will have com
paratively little bearing on the national election.
Fourth. Three months may not be a sufficient time in which to test the ques
tion of the tranquillity of the country and the success of the experimental pre
liminary election, and therefore our declaration should not be more limited
than that the national elections will be held within six months after the pre
liminary election.
Fifth. It is of course proper to comply with the constitutional require
ments as to the interval of one hundred days between the congressional and
presidential elections and the vote of the electoral colleges, the assembling of
the Congress, and the inauguration of the new President. The government of
this island should then devolve on the newly elected President and Congress.
Sixth. The carrying out of this plan is of course strictly dependent on the
tranquillity of the country, which must continue through the two elections and
must give assurance of the stability of the new government, because without

23
this the United States will not be discharging the obligation devolving upon it
by reason of the intervention.
Seventh. It is in the interest of the business prosperity of the island that this
policy, if it is to be adopted, be made public.
I have submitted the substance of this letter to the President, and he ap
proves the foregoing and directs me to make this communication to you.
The provisional administration has proceeded in accordance with
the views expressed in the above letter.
CENSUS.
It being determined to take a census of the population of Cuba,
Mr. Victor H. Olmsted was appointed director of the census on April
29, 1907. On May 8 following a decree was issued making provision
for the taking of the census " for electoral purposes and such other
purposes as the statistics are desired to serve."
In order to effect a proper organization, Cuba was divided into 6
districts, corresponding to the 6 provinces of the island, and 6 super
visors were appointed.
The work of subdividing the different provinces into districts most
convenient for purposes of enumeration was carried forward as
rapidly as possible, and at the same time persons were selected for
appointment as enumerators.
While this preparatory work was in progress the necessary sup
plies for the taking of the census were purchased, blanks were printed,
instructions to supervisors and enumerators formulated, and all the
other preliminary work incident to census taking accomplished.
The supervisors were called to Habana and were personally in
structed and drilled by the director of the census. They were re
quired, among other things, to perform the work of an ordinary
enumerator, and the schedules prepared by them were criticised and
recriticised until they became letter perfect in the work.
The supervisors upon returning to their provinces assembled the
" instructor enumerators " (one from each municipality) and person
ally instructed them in the same manner that they themselves had
been instructed by the director of the census. These instructor enu
merators returned to their respective municipal terminos and there
instructed the ordinary enumerators.
On September 6, 1907, a proclamation was issued fixing Monday,'
September 30, 1907, as the day on which the enumeration should be
gin, and requiring the same to be completed not later than November
14, 1907. During the interval between September 6 and 30, 1907, the
supplies to be used by the enumerators were distributed, and on the
day fixed by my proclamation the enumeration began simultaneously
in every portion of the island. It was carried forward with very
little interruption; such few obstacles as presented themselves were

24
readily overcome, and the entire field work of the census was com
pleted within the required time.
Eighteen hundred enumerators were employed, and the results of
their labors have been thoroughly and intelligently accomplished.
It is probable that in thoroughness, clearness, and general excellence
this census will compare favorably with any census ever taken. All
the schedules from every portion of the island should be in Habana
by or before the 15th day of December. They could be brought here
immediately were not the supervisors required to scrutinize them
carefully for the purpose of correcting errors and supplying de
ficiencies. The director of the census now has a considerable force of clerks
at work (which will be increased as rapidly as circumstances require)
engaged in the preparation of alphabetical lists of male citizens of
Cuba, 21 years of age and over, who are entitled to the right of suf
frage. A separate list will be prepared for each barrio in the island,
of which there are about 1,000. The work of preparing these lists
will be pushed forward with all possible speed consistent with ac
curacy, after which the work of tabulating the entire returns and
the preparation of the full census report will be taken up.
Judging from the returns thus far received, the total population of
Cuba is estimated to be about 2,000,000, an increase of about 25 per
cent as compared with that shown by the census of 1899.
POLITICAL PARTIES; THEIR PRESENT ORGANIZATION.
The political parties in Cuba now present an alignment somewhat
different from that at the time the provisional administration was
established. The Moderate party has ceased to exist under that name.
There is a new party called the Conservative, which is largely com
posed of former members of the Moderate party, but is under the
direction of new leaders. The Independent National party, or the
portion of that party which followed the leadership of Emilio Nunez,
governor of Habana Province, and therefore known as " Nuiiistas,"
have joined the Conservatives, but another independent party calling
itself Republican was started and has joined the Miguelista faction.
The Liberal party is " split." This split is caused by the rival can
didacies of Senator Alfredo Zayas and Maj. Gen. Jose Miguel Gomez
'for the nomination for the Presidency. Maj. Gen. Jose Miguel
Gomez was the candidate of the Liberal party in opposition to the
reelection of President Palma at the elections in 1905. He and his
adherents take the position that those elections were fraudulent and
should be considered as not held, and that he is the legal, as well as
the logical, candidate of the party at the forthcoming elections.
Senator Zayas and his adherents refuse to admit the claims of the
" Miguelistas " and insist that the Liberal party, finding itself unable

25
to overcome the fraudulent measures adopted by the Government to
insure success at the Presidential elections of 1905, abandoned the
field, dissolved the party organization, and terminated the candidacy
of Maj. Geu. Jos6 Miguel Gomez, who voluntarily surrendered his
candidacy; that the revolution brought about a new condition of
things, and that many new men and measures came to th'e front ; that
Senator Zayas, the chairman of the national committee of the Liberal
party, also became chairman of the revolutionary committee ; that he
conducted the negotiations with the Peace Commission on behalf of
the Liberal party and the revolutionary organization in such manner
as to secure the accomplishment of practically all of the purposes of
the revolution and the Liberal party, and that these services entitle
him -to the nomination.
The two wings of the Liberal party are commonly known as the
" Miguelistas " and the " Zayistas." Both seem equally determined
to adhere to their chosen leader. There have been several attempts
to reconcile these factions, or to settle the disputed question by
mutual agreement, or arbitration, but so far all have failed. At
tempts have been made to select a third candidate upon whom both
factions cam unite, but that also has been unsuccessful. There has
been no test of strength by which the size of the respective followings
can be estimated. The forthcoming municipal elections, however,
will probably afford opportunity for a fairly accurate estimate.
The Miguelistas sought to have the old national committee of the
Liberal party issue a call for the election of the precinct, municipal,
provincial, and national assemblies of the party. A majority of this
committee favor the candidacy of Senator Zayas and declined to
issue the call for the reason that it was too far in advance of the
elections. Thereupon the Miguelistas proceeded to the selection of
assemblies without said call, and completed their organization, even
to the election of the delegates to the national convention, in all of
the provinces excepting Habana. The Zayistas are preserving the
old organization by filling the vacancies in the assemblies and com
mittees occasioned by the abandonment of positions by the followers
of Jose Miguel Gomez. *
This' split in the Liberal party has occasioned much trouble to the
provisional administration, especially in the matter of distribution of
patronage. Both sides claim to be the regular organization of the
Liberal party and, as such, entitled to the advantage secured by the
agreement with the Peace Commission. General Gomez insisted that
the committee recognized and relied upon in the selection of appoint
ees did not accord him fair treatment, and that a majority of said
committee favored the candidacy of Senator Zayas and were making
recommendations which resulted to the exclusive benefit of that candi
dacy. He and his supporters on the committee withdrew from the

26
same and notified the provisional governor that said committee no
longer represented that branch of the Liberal party which supported
the Gomez candidacy. The rank and file of both followings are Lib
erals and belong to the class which had been excluded from national
patronage. It was imperative that the provisional administration
should deal justly and impartially with both factions. Each side
admitted that the other was entitled to participate in the patronage,
but each side has insisted that the provisional governor is favoring
the other in the matter of patronage.
GRANTING OF FRANCHISE TO ALLEN RESIDENTS.
Politics in its broad relation to the maintenance and development
of government in Cuba is complicated by the fact that a large por
tion of the population is composed of resident aliens and that a large
portion of the commerce, productive industry, and public utilities
are owned and conducted by resident and nonresident foreigners.
Under the Spanish regime the Spaniards in Cuba were a privileged
class, and it was practically impossible for a Cuban or alien to estab
lish and maintain a commercial institution. The wonderful richness
of Cuba and its commercial possibilities are well known, and upon
the withdrawal of Spanish sovereignty and the establishment of the
Cuban Republic many foreigners and much foreign capital entered
Cuba and engaged in commercial enterprises. The flood of Spanish
immigration was checked for a short period, but soon revived and has
continued unabated. There has also been a large immigration from
other European countries, and the United States. It was, of course,
desirable that the old Spanish residents of the island, and the new
comers of all nationalities should become citizens of the Republic and
identify themselves with and participate in the effort to establish
and maintain the Government. The treaty of peace between the
United States and Spain made provision whereby the Spanish resi
dents of the island became citizens of the new Republic without action
on their part, but provided that, upon declaration of a desire so to do,
they remained subjects of the King of Spain. The constitution of
the Government of Cuba provides an easy and simple means of natu
ralization; but the Republic of Cuba was in its experimental stage
and few foreigners, newly arriving in Cuba or having property inter
est therein, were willing to surrender their citizenship and resulting
right to protection. It follows from this that a large proportion of
the business and property-owning classes are not citizens of the
Republic, and avoid the obligations of citizenship. There is a mani
fest neglect of even the obligations devolving upon a resident alien
who receives for his person and property all the benefits of orderly
government and the business opportunities existing in the island
without the responsibilities of citizenship ; they, of course, pay tariff

27
dues and such taxes as are imposed by local governments, but the
greater obligations are avoided. This large class, however, is per
sistent in securing both general and special benefits and exercising
freely the right of criticism and complaint as to the Government,
its agents, and its agencies. They apparently stop when they have
performed this service to their own satisfaction and make little or no
effort to influence or control political powers by which good govern
ment is to be secured.
The remedy for this situation, at first, appears to be to impose the
obligations of citizenship upon resident aliens who, by five years'
residence and a knowledge of the Spanish language, have become
sufficiently informed as to local and national affairs and public
thought and feeling to be of substantial service in the proper exercise
of political powers. The advisory law commission, in drafting the
electoral law, devoted much time and effort investigating and consid
ering the proposition to bestow the right of suffrage, in municipal
elections, upon resident aliens. The proposition, however, met with
objection from both Cubans and foreigners. They feel that this
would renew the animosities created during the long struggle of the
Cubans for independence. Many protests were received from both
Cubans and Spaniards. Both called attention to the fact that suffi
cient time had not elapsed to completely eradicate the bitterness,
although, happily, rapid progress has been and is being made in the
right direction. The Cuban protests called attention to the fact that
a majority of the population of many towns in the island, including
Habana, are aliens-; in several of the towns the Spanish contingent
constitutes a majority, and in several more the combination of the
Spanish and Chinese residents would constitute a majority. The pro
tests from the Spaniards called attention to the injustice of compel
ling them to participate in the partisan strife resulting from election
contests and expressed a grave fear that they would be injured by
having* the right of franchise forced upon them. The matter is still
under consideration by the advisory law commission and, therefore,
is not further discussed.
TERMINATION OF THE PROVISIONAL -ADMINISTRATION.
The work of the census enumerators is completed and this naturally
induces the general public to consider the question as to when the
elections are to be held. The electoral lists to be compiled from the
enumeration lists will be completed by February 1, 1908. Publicity
and opportunity to correct errors must be given, and it will probably
be February 15 before the lists are finally completed. The new
electoral law, municipal law, and provincial law must be put in force
before the elections can be held, and the advisory commission has

28
found that, owing to the lack of legislation at present, a municipal
accounting law and municipal tax law will be required in connection,
with the organic municipal law. The electoral law, the municipal
law, and the municipal accounting law are about ready to be sub
mitted to the provisional governor, but, while the drafts of the muni
cipal tax law and the provincial law have been made, they have not
yet been considered by the commission. Prior to enactment, these
laws will be printed and made public in order that the people may
read and study them and offer such suggestions as they deem ad
visable. The decree promulgating these laws will probably be issued
early in February, 1908. It will then be necessary to organize the
central electoral boards and the provincial and municipal boards re
quired by the electoral law. This organization will probably not re
quire more than forty-five days, and, therefore, should be completed
by March 15, 1908. The municipal boards take charge of the electoral
lists and verify, correct, and add new registrations, but must com
plete the registration twenty-nine days before the elections. It will
also be necessary to provide voting booths, furniture, and other para
phernalia for the elections and to instruct the election boards as to
their new duties. The call for provincial elections must be issued
seventy-five days, and for municipal elections sixty days. As the
first elections are for both provincial and municipal officials, the call
will be for seventy-five days.
The elections are to be held under a new law, not yet in force;
and as there are many provisions that will require explanation and
instruction, I doubt if the periods of time mentioned can be permitted
to overlap to any considerable extent; therefore the provincial and
municipal elections will presumably be held in April or May, 1908.
The agreement reached by all parties as to the holding of the elec
tions provides as to the Congressional and Presidential elections as
follows (see letter of Secretary Taft, dated April 10, 1907; supra) :
Fourth. Three months may not be sufficient time in which to test the ques
tion of the tranquillity of the country and the success of the experimental pre
liminary elections, and therefore our declaration should not be more limited
than that the national elections will be held within six months after the pre
liminary elections.
The tranquillity of the island is absolute and complete, and I
believe it will not be seriously disturbed by the preliminary elections.
Doubtless numerous election contests will develop which must be
settled, for it is essential that the municipal and provincial officials
be duly installed and become familiar with the duties of their offices
prior to proceeding with the second election. I do not think this
will require six months, but of course can not fix the limit without
knowing the effect of the preliminary elections. The present pros
pect is these elections will pass off quietly and will cause sufficient

29
amalgamation of the existing political groups to show the general
outline and outlook of the national contest, and the proper thing
to do — in fact, the only thing that can be done — is to await the results
of the provincial and municipal elections before taking the next step.
The serious aspect of the present situation is the lack of unanimity
among the people and the want of a political issue of sufficient im
portance to command the efforts of a majority of the electors for its
promotion. The campaign involves no other issue than the personal
popularity of the several candidates now announced or being con-
sidered, and in its present stage consists of efforts to secure the sup
port of local leaders ; it is similar to the anteconvention campaigns in
the United States. At this time there exists a general lack of confi
dence that any of the candidates has a following sufficiently large
and united or possesses sufficient prestige and public confidence
to make his administration stable if he were elected and installed
in office. The partisans of each candidate are certain their leader has
such a following and prestige, but they are equally certain all the
other candidates have not. As already stated, I hope and believe the
preliminary elections will give the several parties more form and
substance and do away with this uncertainty. If they do not, the
question of the time for holding the Presidential election will be fur
ther complicated instead of elucidated.
During the first few months of the provisional administration
there was considerable discussion of the advisability of bringing
about the annexation of Cuba to the United States, or the establish
ment of a protectorate by the United States over the island. In
spite of the oft-repeated assurances to the contrary, a large number
of Cubans fear the United States desires and contemplates the annex
ation of the island. This feeling interferes with the attempts of the
United States to assist Cuba and will continue to interfere with the
carrying out of the obligations of the treaty by which the United
States guarantees and protects the sovereignty of the Cuban Republic.
This fear is of natural origin. The Cubans rightly consider their
island the richest in possibilities and the most salubrious in climate
of any portion of the Western Hemisphere, if not the world; they
remember the struggle Spain made to retain it, and, as most men do
with a possession they greatly prize, they can not realize that others
do not covet it ; they know the strategical importance, from a military
standpoint, of Cuba to the United States and were made accustomed
by centuries of Spanish rule to seeing everything subordinated to
military requirements; also, from their point of view, the trade and
commerce of the United States apparently would be benefited by the
annexation of the island. The Cubans have the utmost confidence in
President Roosevelt and his Administration; many of them realize
that public sentiment and many of the great special interests of the

30
United States are opposed to annexation now or hereafter: they
know that the joint resolution adopted in April, 1898, by the United
States Congress, " that the people of the Island of Cuba are and of
right ought to be free and independent," is a part of the permanent
legislation of the United States and that recourse was had to the war
powers of the nation to enforce recognition of this declaration; but,
nevertheless, the fear lurks, especially among the ignorant; this, comes
in large measure from the periodical agitation of the matter by resi
dents of the island who desire annexation, and the fears of the people
are taken advantage of by numerous agitators and politicians seeking
to promote their personal interests or prestige. If it were possible to
entirely allay these fears and make all the people of Cuba realize how
sincerely and steadfastly the people of the United States desire and
intend that the sovereign independence of the Republic of Cuba shall
be preserved, and the Government of the island administered by offi
cials elected by citizens of the Republic, many difficulties of the Cuban
situation would be eliminated ; but the assurance of the United States
has been repeated so often, and as it is now crystallized into con
gressional legislation, treaty stipulation, and international pledge,
there is nothing more possible.
Doubtless the desire to be brought under the jurisdiction and direc
tion of the Govermnent of the United States continues to prevail
among the large alien contingent and a small number of Cubans who
own property and fear a recurrence of disorder. An overwhelming
majority of the Cubans are unwilling to surrender the independence
and sovereignty, to secure which practically every Cuban of this
generation joined in revolt against Spain. The universal prevalence
of this sentiment among them gives me confidence that the Cubans
will achieve good and stable government. During the years of war
fare against Spain they willingly endured great hardships and cheer
fully made great sacrifices. This action on their part was not spas
modic, but the hardships and sacrifices were long sustained. At the
present period of their national development it is necessary that
they should make sacrifices and compromises of individual opinions,
preferences, and desires respecting the personnel and conduct of affairs
of government, and I believe that when they finally ascertain and
realize what these sacrifices are, and would accomplish, they will be
made in the same spirit and with the same completeness that makes
possible the maintenance of stable government in all well-regulated
Republics. The provisional administration is going ahead as rapidly as circum
stances and conditions permit with the execution of the plan set forth
in Secretary Taft's letter. Up to this time peace and tranquillity
have prevailed in the island, and substantial progress has been made
in gratifying the desire of the Cuban people to make stable the Re-

31
public and secure for its people good laws, good administration, pub
lic improvements, promotion of commerce, and development of the
island, together with the other benefits of public peace and domestic
tranquillity. ECONOMIC CONDITIONS.
Tested by tangible evidence the economic situation is excellent.
AGRICULTURE, COMMERCE, AND INDUSTRIES.
In October, 1906, it was generally feared that the revolution had
destroyed the financial credit of the island; the long-continued
drought was believed to have greatly injured the cane, tobacco, fruit,
and vegetable crops. A cyclone devastated the island during the month
and was believed to have completed the total loss of the cane and to
bacco crops. Everyone expected the receipts of the custom-houses
would diminish and a general fear prevailed that the revenues of the
Government would not be sufficient to meet the obligations and cur
rent expenses. The outcome was quite the reverse of public expecta
tion. The island produced more sugar than ever before in its history.
The tobacco crop was short, but superior in quality and commanded
the highest price in the history of the industry in Cuba. The fruit
and vegetable crops were large and showed a gratifying increase in
acreage over previous years, and, although the output was reduced by
the drought, the prices secured were high and results gratifying to the
producers. The customs receipts were in excess of any preceding
year, and the condition of the public treasury continued to be
excellent. The rainfall in Cuba during the past twelve months has been con
siderably, less than usual. The rainfall during what is known as the
" Rainy season " was little in excess of the amount of rain that
usually falls during the " Dry season," and during this year's dry
season there was little, if any, rain. This has impeded the growth of
the cane and there will be a corresponding reduction in the amount
of sugar produced from a given quantity of land, but there has been
an increase in acreage, and the prevalent opinion is that the island
will produce at least 1,150,000 tons of sugar. Rains between this time
and the completion of the harvest will increase the output. Some
portions of the island had rain in sufficient quantity and frequency to
secure ordinary growth of cane, while in other portions the cane is
small. The cane has grown throughout the season, but not as rapidly
as usual and is about thirty days behind its usual development. If
the cane cutting is postponed for an equal length of time, the yield
will be correspondingly increased. There is a good deal of cane that
was left uncut last year, and this is well matured and will be cut first,

32
but this will not take more than two weeks. The difficulty about
delaying the cutting is that all the cane will not be harvested by the
time the rainy season sets in next spring. When the rains come it is
difficult and expensive to work in the fields and haul the cane to the
railroads or the mills. Sugar experts predict that the price of sugar
will be high ; and if the prediction is realized, the sugar output of
Cuba will bring at least the average financial return.
The tobacco crop is now being planted, and therefore no estimate
can be made as to the yield, but there will be a large increase of acre
age, and there is nothing to indicate a reduction of the present high
prices. There is also a substantial increase in acreage devoted to the raising
of bananas, pineapples, oranges, and other fruits, and the raising of
vegetables to supply the demand for fresh vegetables during the win
ter season in the United States.
The culture of coffee also shows gratifying increase, and new groves
are being planted in those portions of the island where this important
food product is successfully grown.
The iron industry is showing remarkable advancement. New de
posits of ore have been discovered and are being developed. Exten
sive plants which require the construction of railways, mills, piers,
and dredging of channels are being installed.
The manufactures of the island, especially those which consume
the natural products, are in prosperous condition, and are rapidly
expanding in capacity and output.
Foreign and domestic commerce and trade for the past year show a
gratifying increase over preceding years.
The increase in customs receipts at Habana from December 1, 1906,
to October 31, 1907, over the same months in 1905-6 amount to
$1,381,684.15. ,h
The receipts of the treasury from other sources from December 1,
1906, to October 31, 1907, as compared with the receipts for the same
months in 1905-6, show an increase of $48,158.41.
The receipts of the post-office department from December 1, 1906,
to October 31, 1907, show an increase of $58,290.02, as compared with
the receipts for the same months in the year 1905-6.
The condition of the national treasury on October 31, 1907, is shown
by the following statement:

33
Statement of the financial condition of the Republic of Cuba.
On hand and in Treasury, September 29, 1906 (date of estab
lishment of provisional government)  $13,625,539.65
Received during period from September 29,
1906, to October 31, 1907 :
Customs receipts  $27, 747, 170. 30
Consular receipts  420, 055. 86
Post-office receipts  870, 346. 05
State taxes  995, 632. 07
Income from state property  386,093.02
Internal revenues  4,451,607.50
From all other sources  6, 371, 119. 71
 41,242,024.51
Total  54; 867, 564. 16
Expenditures since September 29, 1906:
Congress  284,956.58
Executive office (salaries, materials, etc.) __ 87,500.54
Department of treasury  5, 247, 973. 36
Department state and justice (including
judiciary)  1, 964, 178. 71
Department of government (including
armed forces, census, and sanitation)  12,910,986.45
Department of public instruction  4, 523, 339. 26
Department of public works  9,450,702.85
Department of agriculture  291, 043. 53
Interest on loan and cost of collection of
internal revenues  2, 711, 053. 56
Special deposit  743, 007. 00
Payments to army (2d-50 per cent)  1, 398, 488. 76
 39,613,230.60
Balance in treasury, October 31, 1907  15, 254, 333. 56
EfiSUM^i.
Surplus from —
Revenues  $9, 525, 489. 13
Taxes  2, 568, 987. 12
Special fund  311, 916.4-1
First army loan  632, 431. 00
Second army loan  2,215,509.87
Total  15, 254, 333. 56
This amount is not all available or " free cash." There are in
cluded in said funds unexpended balances of permanent appropria
tions by the Cuban Congress for public works $5,489,516.42, and unex
pended balances of permanent appropriations for public improve
ments made by the provisional administration amounting to $2,153,-
909.87. These two foregoing sums can not be charged, in full,
against the cash balances in the treasury, for the unexpended portion
23706—08  3

34
of appropriations for works now in progress are, either in whole or
in part, in the hands of disbursing officers and deposited to their
credit in the Banco Nacional or Royal Bank of Canada, and do not
appear in the cash account of the treasury. The total amount on
deposit in the Banco Nacional to the order of the disbursing officers is
$3,476,955.96, and in the Royal Bank of Canada $72,234.54, making a
total of $3,549,190.50. What amount of these deposits consists of
unexpended balances of appropriations made by special laws and
what amount is chargeable to the current expenses provided for in the
budget can not be stated until the end of the fiscal year, but it is safe
to assume that at least $1,000,000 consists of unexpended appropria
tions for public works. The funds in the treasury also include
$1,000,000 of national bonds (Speyer) purchased by the Government
in 1905, and unavailable for reissue or appropriation; also $2,847,-
940.87 unexpended balances first and second army pay loans unavail
able for appropriation. It follows from the foregoing that the
amount of cash in the natonal treasury available for appropriation is
$4,551,310.63. The annual budget for the fiscal year ending June 30, 1908, appro
priates the sum of $23,309,539.87 from any money in the treasury not
otherwise appropriated for specific purposes, as follows :
For the executive power — provisional government  $105, 980. 00
For the department of state and justice  680, 265. 57
For the department of government  8, 973, 002. 65
For the department of the treasury  3,440,954.65
For the department of public instruction  4, 195, 868. 00
For the department of public works a  4, 445, 226. 00
For the department of agriculture, industry, and commerce  274, 988. 00
For the judicial power  1, 193, 255. 00
Total  23, 309, 539. 87
The application of the foregoing appropriations must be adjusted
in accordance with allotments detailed in statements attached to and
made a part of the Decree establishing the budget.
The estimated receipts to cover the appropriations hereby provided
are as follows :
Customs, less amount for covering the expenses of the legislative
power in the fixed budget  $23, 046, 000
Consular revenues  350,000
Communications  743, 000
Internal revenue  831, 000
State properties and rights  234,000
Miscellaneous revenues  262, 325
Total  25, 466, 325
0 In addition to funds appropriated by Cuban Congress.

35
The receipts of the national treasury for the past five months have
been in excess of the estimate upon which the budget was based,
to wit, $25,466,325, and therefore the appropriations made in the
budget will be provided for by the ordinary revenues, leaving the
available cash now on hand and excess of future revenues over budget
- appropriations to be applied to extraordinary expenditures — elections,
unadjusted claims for damages by insurgent forces, new public im
provements, etc.
Taking into consideration that this showing is for a year immedi
ately following a revolution and cyclone, and includes a period of
panic and world-wide disturbance of business and finance, of strikes
and lockouts throughout the island that paralyzed for months the
cigar-making and building industries, and otherwise interfered with
commerce and industrial pursuits, and with low prices for sugar pre
vailing, some idea is obtained of the wonderful richness and recupera
tive powers of the Island, and impels consideration of the question,
What would be the results of a few years progress under conditions
of tranquillity, united effort, and proper administration?
COMMERCIAL INTERESTS.
The commercial interests of Cuba are in excellent condition. The
foreign and domestic trade is constantly increasing, and this has been
true each year since the Spanish-American war. The commercial
classes are conservative, but are quick to see and take advantage of
actual and genuine opportunities for trade expansion and increased
profits. The development of the commerce has been so well grounded
and safely conducted that no disastrous results were occasioned in
commercial circles from the ebb tide of expansion induced by the
large increase of the currency of the island by the bond issues and
practically free distribution of money and the practically unlimited
credit for the years from 1902 to 1906.
This gratifying condition results principally from the marvelous
productiveness of the island, the constantly increasing population,
and the business sagacity and acumen of the merchants, but no small
share of the credit is due to the Chamber of Commerce, Industries,
and Navigation of Cuba. This organization includes representatives
of all the mercantile interests of the island. Its officers are capable,
f arsighted business men, who keep in touch with all lines of business
in all parts of the Republic and render prompt and efficient assistance
whenever needed. By means of this organization the cooperation
and coordination of all branches and kinds of commercial life is
secured and the individual and mutual interests are promoted. A few
months after the provisional administration was established repre
sentatives of the chamber of commerce presented a large number of

36
complaints which had arisen in the administration of the affairs of
the custom-houses. Practically all of them could be grouped as
complaints against (1) erroneous classification of imports under ex
isting regulations, (2) changes in classification of goods after entry
and payment of the amount of duties demanded, (3) improper inter
pretation and application of the regulations governing coastwise'
trade and navigation, and (4) arbitrary levy of fines and penalties.
Especial stress was laid upon the hardship and injustice of changing
the classification of goods after they had passed through the cus
tom-house and been in the possession of the importers for weeks and
months and, in many instances, sold in the regular course of trade at
prices fixed with reference to the duties originally imposed. The
opportunity for this practice was afforded by the fact that the ac
counts of the custom-houses with the treasury were not audited for
from eight to twelve months after the transactions occurred ; if dur
ing this period a change in classification was made, the auditor re
quired the amount called for by the new classification and the im
porter was required to make good the difference. Each of the com
plaints presented were investigated and all of them finally settled to
the mutual satisfaction of the chamber of commerce and the officials
of the treasury.
This led to the establishment of an arrangement which is work
ing satisfactorily. If a member of the association considers himself
aggrieved by action of any department of the Government, he presents
the matter to the executive committee of the chamber of commerce;
if that body sustains his contention, the matter is presented to the
provisional governor and referred to the department involved for in
vestigation and report; if a difference of opinion is found to exist,
the question is determined1 by the governor. This plan saves both
time and trouble for the Government; it has brought about a much
better feeling and alleviated the " irrepressible conflict " that in all
countries is waged between importers and customs officials.
The approximate value of goods imported and exported during the
fiscal years of 1905-6 and 1906-7 is shown in the following statement :
Goods imported and exported, excluding coinage.

Countries.

Imports.

Fiscal year
1905-6.

Fiscal year
1906-7.

Exports.

Fiscal year
1905-6.

Fiscal year
1906-7.

United States 
Germany 
Spain 
France 
United Kingdom 
Other countries in America
Other countries in Europe .
All other countries 
Total 

848, 830, 629
,215,860,301, 135
,012,540

647,1564, £
987, r
833,1970, C

848, 197, 234
6,433,9698, 287, 061
5,781,602
13, 639, 130
9,501,4123, 434, 585
1, 398, 996

$88, 981, 407
4,309,794 768, 686
1,580,0475, 869, 376
2, 208, 416
806, 529
675, 061

104,395,592

96, 673, 989

105, 199, 315

198,141,012 3,130,757 413,305
1,002,3294, 446, 223
2,211,604 821,672 598, 135

110, 764, 937

37

COINAGE.

Imports.

Exports.

Countries.

Fiscal year
1905-6.

Fiscal vear
1906-7.

Fiscal vear
1906-6.

Fiscal year
1906-7.

8553, 698
279, 360
1, 276, 434
260

87, 558
18, 526
639, 222

81,215,472 842, 083

83, 773, 000
238, 255

Other countries 
9,343
Total 
2, 109, 752
665, 306
2, 066, 898
4, 047, 909
In order to test the financial condition of the people at large, I re
quested statement of annual gross receipts since 1903 of the Havana
Electric Street Railway Company, the Havana Gas and Electric
Light Company, and the savings department of the Banco Nacional,
these institutions being dependent upon the general public for reve
nue and doing business with all classes. The showing made by these
corporations is as follows:
HABANA GAS AND ELECTRIC LIGHT COMPANY.
Gross receipts from 1908.
Month.
1903.
1904.
1905.
January . . .
February .
March 
April 
May 
June 
July 
August 
September,
October 
November .
December .
Total
876, 081. 57
72, 952. 58
76, 320, 01
73, 010. 13
71,670.7476,711.2368, 168. 52
70, 688. 80
74, 963. 16
79,953.79
86, 149. 64
96, 244. 19
S282.81S27b:76,82, -"
87'.92,
103,
649. 99
604. 93
645. 40
007. 03
175. 59
079.65703. 40
701. 17
870. 58
469.90568. 84
638. 65
892, 819, 29
83, 505. 65
85, 368. 75
80, 663. 23
82, 906. 79
76, 460. 08
77, 139. 53
82, 127. 81
84, 007. 99
92, 073. 46
98, 230. 27
. 108,439.51
8104, 593. 31
96, 013. 89
96, 927. 88
101, 636. 77
115, 100. 26
104,299.48
105, 607. 86
111,848.10117,048.16118,648.63123,747.39131, 191. 21
$136, 034. 51
122,075.65121,206.72 122, 726. 89
121,958.12 118, 003. 95
118,641.89124, 355. 36
132, 602. 79
£¦138,000.00 6143,000.00
b 149, 000. 00
922, 944. 36
1,014,915.13
1,043,762.96
1, 326, 662. 93
1, 547, 605. i
a Approximately. 6 Estimated.
HABANA ELECTRIC RAILWAY COMPANY.
Gross receipts from commencement of the operation of electric road in Habana,
including gross receipts of stage lines from April 1, 1903.
Month.
1903.
1904.
1905.
1906.
1907.
%
875, 921. 30
79,024.2888, 139. 74
116, 755. 84
123, 949. 33
117, 963. 84
118,648.83125,408.95124,171.78118, 562. 70
110, 229. 12
114, 618. 48
8119,585.74 117,564.04
128, 408. 52
120, 703. 24
127, 242. 58
123, 530. 49
127, 365. 42
130, 794. 05
125, 949. 23
131,018.20
125, 810. 68
137, 316. 82
8130, 296. 91
128, 789. 08
144, 977. 01
137, 013. 95
154, 757. 29
147, 133. 86
165, 629. 13
156, 254. 19
151,276.70180, 250. 83
159, 072. 80
151,112.08
$156, 347. 42
147, 951. 38
175, 637. 70
136,081.78160, 850. 79
156,414.29167, 832. 14
169, 353. 42
151,719.96
166, 217. 39
160, 471. 32
182, 521. 43
8175, 830. 83
162,834.93
181,564.21
168, 401. 36
176, 003. 10
175, 710. 92
July 
181,650.53
192, 504. 05
179, 559. 66
179, 076. 17
a 182, 000. 00
a 184, 000. 00
1,313,294.19
1,515,289.01
1, 806, 563. 83
1,931,399.02
2, 139, 135. 76
441,'597. 05
201,994.82
291,271.82
124, 835. 19
207, 736. 74
a Estimated.
38
The showing as to the savings department of the Banco Nacional
was submitted by letter from the president of the bank, Mr. Edward
G. Vaughn, from which the following is quoted :
Permit me to say in this connection that the records of the savings depart
ment in the National Bank of Cuba during the two worst months of the year-
September and October— show the following : During September there were 206
new accounts opened, which aggregate all moneys being reduced to United
States currency, over $117,000. In October there were 210 new accounts, aggre
gating $119,000, making a total for the two months of 416 new accounts for an
aggregate amount of $236,000.
The accounts current were almost in the same proportion, but of course in
much larger amounts, and yet perhaps not as significant. This same propor
tion of gain has been maintained through the month of November. These fig
ures only apply to the head office, the branches having shown a gain through
out, but not in a proportion as great.
This gratifying showing does not mean that economic conditions
can not be improved nor that there are no economic wastes to be
checked or evils to be remedied.
The attention of the provisional administration was early directed
to the opportunity and necessity for improving certain economic
conditions. The matters pressing for consideration were —
1. The sanitation of the island.
2. The large number of unemployed annually during the months
of the dead season (May to December).
3. The absence of roads, harbor facilities, and other aids to naviga
tion necessary for the economic production and marketing of the
crops. 4. High cost of transportation by railroad, wagon road, and ocean
going vessels.
5. The high rate of living, i. e., food, clothing, rent, building
material, etc., in the cities and towns.
6. The small margin of profit in the production of sugar.
7. The high interest rate for money.
8. The low price paid for common labor.
9. Extortion by money lenders dealing with wage-earners.
10. Unjust restrictions upon commerce and shipping imposed by
customs-house regulations.
11. A banking law.
12. The use as legal tender and currency of three different kinds
of money. SANITATION.
The sanitation of Cuba is of more than national importance; it is
international and is made the subject of constitutional provision and
treaty stipulation, by both of which the National Government is
bound to take such steps as may be necessary to prevent " a recurrence
of epidemic and infectious diseases."

39
The people of Cuba fully appreciate the great advantages that will
accrue to the island from its proper sanitation and are anxious to
secure those benefits. The Cubans realize the necessity and advan
tages of proper sanitation to a much larger degree than do the people
of the United States in the communities with which I am familiar,
but they look to the Government for the accomplishment of sanita
tion instead of making the necessary individual effort.
The military government (1899-1902) made a brilliant record of
individual achievement and administrative excellence in the matter
of sanitation, but remitted to the Eepublic the enactment of an ade
quate law for continuing that service at a high standard. The
Republic by Executive decree provided for the organization of a sani
tary service coextensive with the island and prescribed rules and
regulations for the performance of the service. The Cuban Congress
(1906) appropriated a total of $3,646,216 for public works and other
objects calculated to promote sanitation and for sanitary services in
the cities and towns of the island. The law promulgated by the
President provided for a central board of sanitation, Avith head
quarters in Habana, and a local board of sanitation in each munici
pality to be appointed by the municipal authorities, the expense of
the sanitary service to be paid by the municipalities and to be pro
vided for in the annual municipal budgets. The revenues available
to the municipalities were not sufficient to permit the apportionment
of the amount necessary for sanitation and therefore the National
Government was called upon to supply the deficiency. Upon trial
it was found that the plan of having the lecal sanitary officers ap
pointed by and subject to removal by the municipal authorities
resulted in the sanitary service being improperly performed or en
tirely omitted. However much a man may believe in the theory and
advisability of complete sanitation he usually objects to the strict
enforcement of sanitary rules and regulations against himself. The
officer attempting to enforce the law usually becomes involved in
difficulty with the offender and complaints to higher authority, which
frequently result in reproofs, restraints, and sometimes dismissal.
Not infrequently the offender is a municipal official and the sanitary
officers are unwilling to bring him to account for fear of losing their
places, or if they undertake to secure proper punishment the local
police and judiciary are indifferent or ineffective.
Under these conditions it seemed advisable for the National Gov
ernment to be charged with the excution as well as the responsibilty
of proper sanitation. To accomplish this result a decree was issued
nationalizing the sanitary service of the island. This decree provides
for a national board of sanitation charged with the responsibility
of securing proper sanitation and given the authority necessary for
accomplishing that result ; the local sanitary boards are abolished and

40
substituted by a chief sanitary officer in each of the municipalities,
who is appointed by the national board ; these chiefs of sanitation are
under the direction and control of the national board and may be
removed by the board ; the municipalities are required to devote one-
tenth of their total revenues to defraying expenses of sanitation ; the
money is paid to the national treasury and made available for the
intended purpose; the cost of sanitation in the municipalities, in
excess of the amount contributed by the municipalities, is defrayed by
the National Government; penalties are prescribed for violations
of the sanitary rules and regulations and may be imposed by the chief
sanitary officer of the municipality, but appeal may be taken by the
alleged offender to the courts. The new organization is rapidly ap
proaching completion, and if the plan is successful it will doubtless
lead to the creation of a new executive department,' to be known as
the " Department of sanitation."
The importance of sanitation to Cuba is not confined to the health
of its inhabitants ; it has a direct bearing upon its development and
commerce. Cuba is capable of sustaining a population many times
the size of the present number of inhabitants, but it will be impossible
to secure such a population of persons who are immune to yellow
fever and other tropical diseases which may be averted by proper
sanitation. Consideration must also be given the fact that it will
be of little use to construct roads, improve harbors, erect light-houses,
etc., if, annually, the ports of the world are quarantined against the
ports of Cuba. Ships will not seek to enter the harbors of the island
if thereafter they are debarred from entering the harbors of other
countries. When the Panama Canal is completed the seaports of
Cuba will be visited by many ships destined for passage through the
canal, but these ships will avoid Cuba if visiting the island debars
them from entering the canal. The Cubans appreciate all phases
of this question, and the plan of making the sanitary service a na
tional matter received the hearty approval of the public at large.
TRANSPORTATION.
General economic principles and the special conditions existing
in Cuba impelled the belief that the basis of permanent improvement
was the construction of roads, the improvement of the harbors, and
the placing of light-houses, buoys, and other aids to navigation cal
culated to induce shipping to frequent the coast.
The principal products of Cuba — sugar, tobacco, timber, fruits,
vegetables, and iron ore — find their market in foreign countries, and
must be hauled from the place of production to one of the harbors
of the coast that can be entered by ocean-going craft and after being
loaded on such vessels transported to markets across the sea.

41
There are at least forty harbors .on the coast of Cuba that, at rela
tively small expense, can be improved sufficiently to be entered by
ocean-going vessels. At present six harbors are available for such
purpose, and none of these are adequately equipped for easily and
quickly handling cargoes, and all of them need dredging. These
harbors are reached from the interior by railroads and from along
the coast by small sailing craft. Many portions of the island are
not as yet supplied with railroad facilities, and the cost of transpor
tation by rail is great.
Cuba is annually subjected to a great economic waste by reason
of the lack and cost of inland transportation. On the 1st of October,
1906, there were less than 500 miles of macadamized road in the en
tire island. The small island of Jamaica-has 1,000 miles of macad
amized road. The products of Cuba are hauled to the markets over
trails that are barely passable during the dry season and absolutely
impassable during the rainy season. In many localities it is impos
sible to transport the products in wagons or carts and necessary to
pack them on horses or mules. Where carts can be used it is neces
sary to employ from four to ten oxen, horses, or mules where two
would be sufficient if good roads existed. Days are spent in hauling
a load to market where hours would be sufficient if the roads were
good. The sugar mills of the island are sufficiently far apart to require
that the greater portion of the cane raised must be transported for a
considerable distance in order to be ground. Owing to the diffi
culties of wagon transportation a large portion of the cane is hauled
from the colonies to the mills on the railways. The rates of railroad
transportation are high, and when good highways are provided a
large saving to the agriculturists will result.
UNEMPLOYED.
Cuba is dependent upon the agricultural products — with the excep
tion of its forests and iron ore — for the production of wealth. Its
principal agricultural product is sugar cane. The cane, when first
planted, matures in about eighteen months, and thereafter is pro
duced without replanting up to fifteen years. It is seldom necessary
to clean out the weeds more than once a year. The cutting, hauling,
and grinding season lasts from about the middle of December until
the beginning of the rainy season, which usually starts early in May.
The cane is cut by hand, and during the cutting season a large number.
of men are employed. They work from daylight until darkness
on all plantations, and some estates are fitted out with electric lights
to enable the cutting to proceed during the nighttime. This season
of the year is the period of growth and harvest for tobacco, fruit,

42
and vegetables. The harvest being completed there is but little to
do on the sugar estates, fruit and vegetable farms, and therefore
about 75 per cent of the men necessary to harvest these crops become
idle. The money they have been able to save from their earnings
during the crop season is hardly sufficient to maintain them during
the remaining six months of the year and is usually improvidently
expended. The tobacco crop furnishes employment for a longer
period of each year, as the preparation of the leaves for market
requires numerous handlings and constant attention, but does not
provide employment for many more persons than are engaged in
raising the crop. Practically all of the cane cutters are without
employment for six months in the year, and by August are without
money or means of support for themselves and families. The most
important economic question in Cuba is to secure employment for
this large number of men during the six months intervening between
the harvest periods.
ROAD CONSTRUCTION  EFFECT ON PUBLIC TRANQUILLITY AND TRADE.
Under these conditions the proper course for the Government to
pursue was plain, viz, to increase road construction and other public
works during the dead season, and orders were issued to the depart
ment of public works to prepare a general plan for a system of mac
adamized roads throughout the island. The torrential rains of the
Tropics make it unwise to construct dirt roads. The instructions to
the department of public works were to plan a system of roads which
should consist of a highway running east and west, approximately
through the center of the island, with branch roads running north
and south to a harbor on the coast, with at least one harbor on the
north and one on the south coast of each of the 6 provinces into which
the island is divided; the equipment of said harbors for handling
cargoes easily and quickly ; and the erection of light-houses and plac
ing of buoys along the coast where needed, thereby inducing ocean
going crafts to frequent the coast and securing the competition neces
sary to reduce the price of ocean transportation ; at the same time the
increased traffic resulting from the development of the country will
give ample compensation to the railroad and steamship lines for such
reduction. In attempting to execute these orders the department of
public works found itself without necessary personnel and equipment,
but these were supplied as soon as possible. The provisional admin
istration desired to have everything in readiness to commence work
on this large endeavor at the close of the sugar-harvesting season in
May, 1907, but the work was retarded, at first by the fear that the
national revenues would be diminished as a result of the revolution
and cyclone, and, second, by the difficulty in securing competent per
sonnel for drafting the plans and specifications.

43
While the plans were being made, effort was made to locate con
tractors with sufficient means and machinery to do the work which
would be entered upon during the present fiscal year, and it was
found that there were only a few contractors so equipped and that
they did not possess sufficient amount of machinery to do the desired
amount of work. Thereupon the Government decided to contract as
much of the work as possible and to do the remainder for the current
fiscal year by administration. This necessitated the purchase of a
large amount of road-making machinery, such as steam rollers, steam
shovels, graders, traction trains, etc. Considerable time passed be
fore the Government and the contractors could secure the necessary
machinery — in fact, all that is required has not yet been delivered,
but much of it has been received and other deliveries are contracted
for and are being made from time to time. Bids were called for by
public advertisement, but it was impossible to get the work started
until late in July, and it was the latter part of August before it was
fairly inaugurated.
It was impossible to completely execute the plan of public improve
ment above outlined within the period fixed for the continuance of
the provisional administration, but the general plan is adopted and
has already received unanimous approval. ' The detail plans, specifi
cations, etc., will be completed, the public works department suffici
ently expanded and trained personnel secured, the machinery pur
chased, delivered, and installed, and the work sufficiently advanced
to make' it fairly certain that the plan will be carried out within a
reasonable period. Induced by the adoption of the general plan and
the call for bids, a number of contractors have purchased the neces
sary machinery for road-making plants. The private concerns have
invested large sums of money in purchasing outfits for executing con
tracts on this work and will materially aid in inducing the contin
uance of the work.
Attempt was made to ratably distribute this work in all the
provinces and to begin work in each at about the same time. The
obstacles to overcome were so numerous that it became necessary to
concentrate effort on one province at a time. Pinar del Rio was
selected as the first, largely because it was feared at that time that
the tobacco crop of that province for the year 1906 would be nearly
if not a total failure ; timely rains, however, made the crop satisfac
tory in quantity and quality. As soon as the preliminary work in
Pinar del Rio Province was completed, Habana Province was taken
up, and shortly thereafter Matanzas Province. The work is not yet
fully started in Santa Clara, Camaguey, and Oriente provinces,
altfiough work on some of the roads commenced late in the season
and other roads are being projected.
Three principal objects were contemplated by starting these public
improvements— the development of the country, the reduction of the

44
economic waste resulting from the difficulties of transportation, and
the improvement of the industrial situation by providing employment
for a large number of men who would otherwise be idle. The belief
was entertained that the construction of these roads would also tend
to preserve public tranquillity and substantially promote trade and
commerce. PUBLIC NECESSITIES AND IMPROVEMENTS.
The public necessities did not permit the work of public improve
ment to be confined to the rural districts. There is great need in Cuba
for national, provincial, and municipal betterments, such as school-
houses, post-offices, and other public edifices. The cities and towns
need public buildings, waterworks, sewers, pavements, parks, etc.
The existing structures devoted to governmental or public use are
largely the old Spanish forts, jails, churches, convents, etc., and need
to be remodeled or reconstructed. Much of this work was done by
the military government and the Republic, but the buildings are old
and not adapted to the purposes to which they are devoted, and many
of them are allowed to fall into disrepair. The cyclone of October,
1906, damaged practically all and demolished some of them.
ASSISTANCE TO MUNICIPALITIES.
The necessity of municipal improvements is very great. It is
reasonable to estimate that it will take not less than $75,000,000 to
provide the municipalities of Cuba with the public improvements
desired and needed by the inhabitants.
In distributing the powers of taxation, the laws of Cuba do not
provide means for the municipalities to secure sufficient revenues to
provide for municipal improvements considered essential to modern
life and which are usually paid for with municipal funds. This will
be remedied, in part, by the new law of municipalities. Meanwhile
the provisional administration continues the policy pursued by the
Spanish administration, the military government, and the Republic,
of using a reasonable proportion of the national funds in aiding the
municipalities, but when possible, the municipalities have been re
quired to participate in the cost by appropriation of municipal funds
or private subscription, and also to make provision for the mainten
ance of the improvement at the expense of the municipality. In order
to secure proper investigation and determination of the innumerable
applications for aid to municipalities and to prevent improvident ex
penditures, a board of municipal aid was appointed consisting of
Lieut. Cols.. William M. Black, president, E. St. J. Greble, and Maj.
J. R. Kean, all of the United States Army, to whom these applications
are referred for examination and recommendation. This board made
an examination of the receipts and expenditures of the various mu-

45
nicipalities, and found that, though in general, a wiser administration
of municipal funds would make provision for the municipal needs,
excepting those requiring the immediate expenditure of large sums,
such as waterworks, etc., under existing conditions a continuation of
State aid is advisable.
All petitions from private citizens are referred to the authorities
of the respective municipalities for recommendation. Allotments
of funds are recommended for necessary work, as far as practicable,
in such a manner as to be equitable throughout the island. Action
has been taken on 107 petitions. Forty-one cases were favorably
reported on; 34 cases were disapproved. In the other cases final
action has not yet been had. The adopted policy is to provide first,
when possible, the works most needed for sanitation, such as water
supplies, slaughterhouses, cemeteries, markets, etc.
TRADE AND COMMERCE.
The trade and commerce of the island have been greatly stimulated
by the distribution among all classes of the large amount of money
expended for public improvement. The laboring man, from neces
sity, expends his money as soon as received in purchasing supplies
for himself and family. As before noted, this year has been one of
exceptionally long and continued drought. The tobacco crop did
not " cure " as rapidly as usual and, in fact, is not yet marketed. The
revolution of 1906 induced many people having loans in Cuba to
refuse extensions and insist on payment. Ordinarily under these
conditions the trade and commerce of the island would diminish,
yet for the nine months from December 1, 1906, to August 31, 1907,
inclusive, the receipts of the Habana custom-house show an increase
over the receipts for the same period of the year 1905-6 of $536,-
044.80, being an average monthly increase of $59,560.53. By August,
1907, the work of road building and other public improvements
was well under way, and the effect upon business is shown by the
fact that custom-house receipts for the island for September and
October amounted to $5,131,524.76, being a monthly average increase
of $360,133.02. LIQUIDATION OF PRIVATE INDEBTEDNESS BY PLANTERS.
The events in Cuba during 1906 — revolution, retirement of the
Palma Administration, and the cyclone — naturally injured private
credits and induced many foreign and domestic creditors to seek to
collect their accounts. This liquidation of private indebtedness has
continued through the year and a large amount of indebtedness has
been discharged. Under ordinary circumstances this period of liqui
dation would have terminated at the end of a year, or by October,

46
1907; but, unfortunately, in October of this year came the panic and
the resulting world-wide money stringency. Owing to the liquida
tions of the year, the panic did not produce a financial crisis in Cuba's
business circles, but it further continued the demands for payments
and will undoubtedly extend the period of enforced liquidations at
least another year. These periods of general payment of debts are
exceedingly beneficial and are usually recognized as such after they
are completed, but while the liquidation is going on individuals suf
fer and considerable discontent prevails.
The severities of the situation in Cuba have been reduced to a
minimum by the expenditures for public works and the wonderful
fertility of the island. These combined have kept trade, commerce,
and industrial activity up to, if not beyond, the average. The liquida
tion now in progress, when accomplished, will put the commercial
and industrial interests of Cuba on a conservative and solid founda
tion for the first time in the history of the island. During the many
years of intermittent warfare by which the Cubans gained their in
dependence, and during the Spanish- American war, conditions were
abnormal; the time of the military government was a period of
readjustment and reorganization, during which normal conditions
could neither be reached nor ascertained ; during the first three years
of President Palma's Administration there was an abnormal stimu
lus to trade and expansion of credit resulting from the distribution
among the Cubans of $2,544,750, ostensibly for the purchase of the
arms held by the late soldiers of the armies of liberation ; and shortly
thereafter the payment of $27,716,248.59 to the soldiers of said
armies for military services in the wars with Spain, and at a later
date the payment of $16,553,869.59 in cash and $10,617,000 in bonds
in further compensation for said services, making a total of $57,431,-
868.18. This money was distributed so long after the service was
rendered that the recipients had forgotten how hard they had labored
to earn it. With most of them it was " easy come, easy go."
In 1903 the price of sugar was high; the yield per acre and total
output in Cuba was the largest in the history of the island up to that
time ; the profits of the planters were great. In 1903 the money mar
kets were glutted with money seeking investment, and the knowledge
of the probable profits of sugar production in Cuba caused a flood of
money to the Island for investment in that industry. Sugar mills
sprung up and cane fields planted all over the Island with more at
tention given to early completion than to economical expenditure.
The establishment of the Republic afforded opportunity for thou
sands of Cubans to hold official positions with rank and emolument.
Under these, circumstances it was inevitable that unnecessary
credit would be tendered and accepted and extravagant expenditures
incurred ; such has been the result in all countries at all times under

47
similar conditions. But now the money distributed by the Govern
ment has been spent ; the notes given for money loaned to build sugar
mills and plant cane fields have matured, and the period of liquida
tion set in something more than a year ago. The sugar industry in
Cuba is in a flourishing condition and, as an industry, will promptly
and easily meet all the demands of liquidation. This results from the
fact that many of the estates are free from mortgage or owe no more
than they can readily handle. There are other mills and estates that
are not as well conditioned, having borrowed more than justifiable or
omitted to reduce the indebtedness in previous years. These need
only time and economical administration to pay out in full.
The properties are fine investments, being new and modern, and
the conditions for growing cane are ideal. There is no possibility of
a total crop failure such as in past times periodically visited the agri
cultural portions of the United States. New cane fields are started
every year. The world's consumption of sugar increases every year.
Theoretically the outlook for the sugar industry is most encouraging.
The principal difficulty with which the sugar planters contend is
the expense incurred in preparing the fields, cutting and getting the
cane from the field to the mill, grinding and converting into sugar,
transporting to market, and selling the product. This requires a
large amount of money and must be done in about six months. Dur
ing the remainder of the year the mills are practically closed and the
estates are kept up at comparatively small expense. If the money
can be obtained at reasonable rates, it is good business to borrow for
the period of the harvest season instead of making it a permanent
addition to the capital invested. In an ordinary year the money to
make the crop is wanted in November. At that season of the year
money is in demand in the United States to move the crops of cereals
and equally in demand in Europe to purchase these crops. It is also
near the end of the year when the annual balances are struck in all
lines of business and banks throughout the world are drawing in their
temporarily outstanding accounts and overdrafts in order to close
their annual business.
The usual practice is that the planter applies to a money lender,
either directly or through the lender's agent, on or about August 1
for a certain amount of money required to help him through the
season, i. e., he will require during the months of August and Sep
tember money for repair of machinery actually installed, or money
for the installation of new machinery, also considerable money for
the preparation of the fields for the planting of cane. In this case
the planter not only offers to compensate the money lender by a pay
ment of good interest — ranging from 8 per cent to 14 per cent — but
also binds himself to sell to the lender the sugar which is ground until
the indebtedness is liquidated, on which the lender receives an addi-

48
tional commission as selling agent. The loans are repaid all the
way from January to June or July, i. e., as the sugar is sold either
the whole or part of the receipts therefrom is applied to the liquida
tion or reduction of the actual loan existing. In Cuba, as in all other
countries, the large planter whose plantation is not mortgaged to the
limit, or even beyond the limit, has no difficulty whatever in obtain
ing money and credit, but the small planter, or even the large planter
who is not so fortunately situated, is under the double disadvantage
of having difficulty in obtaining credit, but, if obtained, the interests
and commissions collected are so enormous that he is fortunate indeed
if sufficient funds remain to fairly compensate him for his labor.
When the high cost of selling the sugar is added to the high cost of
transportation by land and sea of the cane, the supplies for the
estates, the sugar, etc., it will be seen that the present low price of
sugar gives the Cuban producer little margin of profit. The out
look for the season of 1907-8 is that, owing to a reduced yield
throughout the world, the price of sugar will be higher than that
now prevailing. In anticipation of higher prices the sugar mills are
agreeing to pay higher prices for cane. If the price of sugar goes
up the situation of the Cuban planters will be relieved, temporarily
at least, and if the profits realized are devoted to reducing existing
indebtedness, a partial permanent relief will be secured. Good
roads and enough of them will effect a further saving by reducing
the cost of inland transportation while harbor and coast improve
ments ought to secure sufficient competition to reduce the rates of
ocean transportation. EXCESSIVE INTEREST RATE.
There remains to be solved, however, the question of permanently
reducing the excessive interest rate. On behalf of the money lenders
consideration must be given to the fact that they can not put out
at interest for twelve months in the year the large sum necessary to
supply the demand for many during the cropping season. A large
share of the money must therefore be borrowed in foreign countries
and considerable expense incurred in bringing the cash to Cuba*
transportation and insurance rates are high, and as the money is or
dinarily returned at the end of six months these costs, both in and
out, must be included in the charge for the use of the money for that
short period. While under normal conditions it is easy to secure
more than sufficient funds to make the crops in Cuba, yet the manu
facture of sugar by the modern methods now adopted is a compara
tively new venture in Cuba, and a good many of the new concerns
have not had time to establish their credit. They have not yet dem
onstrated the success of their establishment, and the banker or money

49.
lender must rely upon his own established credit to float the paper
of such manufacturers. From this it results that an attractive in
terest rate must be offered the foreign banker and the local lender
must not only recoup himself, but make certain that his guaranty
will not fail. In short, the lender truthfully says : " The cost to me
is high and I must protect my credit."
Banks ordinarily make loans from their deposits on which they pay
no interest, or a very low rate. There are in Cuba many millions of
dollars hoarded in the safes and houses of the people. It is a com
paratively small per cent of even the business men of the island who
deposit their money in the banks. This results from the secretive-
ness of the people, induced in times past by fear of extortion, enforced
loans, confiscation, excessive taxation, etc. It takes time and a high
degree of confidence to overcome this practice of generations. I am
convinced that if the money in Cuba now withdrawn from circulation
and retained in the possession of the owners was deposited in the
banks and the money used in general business was passed through
the banks to the extent prevailing in other countries, there would be
available to the banks ample funds from which to advance the money
required to make the sugar crop and plant, raise, and cure the tobacco
crop ; and as this money would cost the banks little or nothing, there
would be an immediate reduction in the interest rates to the planters
and business men. The first step in securing this economic and ad
vantageous reform is to secure for the banks general and unwavering
confidence by seeing to it that they are entitled to that confidence.
BANKING LAW.
There is no banking law in Cuba. All the banks of the Island
are private institutions and rely for credit upon their established
reputation and to known probity and means of the men by whom
the bank is owned and operated. A good banking law adapted to
the conditions in Cuba, properly regulating their organization, pro
viding for thorough inspection, requiring adequate reserve fund and
securing for them the known approval and confidence of the Govern
ment would be of great service to the banks and of inestimable ad
vantage to the Island, for it would within a short period of time, if
not immediately, bring to the banks the large amount of money now
withheld. The existence of these private hoards is known; their
amounts can only be guessed. That the total must be a vast sum is
shown by the fact that the balance of trade between Cuba and the
other countries with which it deals has for the past six years been
greatly in favor of Cuba. If the balance of trade with a country is
continuously in favor of that country, such country eventually be
comes rich, unless the money so realized is withdrawn by nonresi-
23706—08  i

¦50
dent proprietors, investors, etc., or carried abroad by residents and
spent in foreign sojourn and travel. It is a fact that much of the
money realized from the products, industries, trade and commerce of
Cuba is withdrawn from the island because of the large foreign hold
ings in its factories, mills, commercial houses, railroads, and other
public service corporations. This is the inevitable result of the neces
sity for bringing in foreign capital at the close of the struggle for
independence and the Spanish-American war. This will gradually
be eliminated as the residents of the Island acquire the means and
inclination to invest in home enterprises, and the process is already at
work. There is one phase of the matter that should be remedied and would
be corrected by an adequate and safeguarded banking system. Many
of the public-service corporations, large mills, and manufactories, and
not a few commercial institutions, do their banking with banks in
foreign countries, shipping the cash or remitting through the local
banks all in excess of the amount used to defray current expenses, and
not infrequently to such extent as to require drawing on these foreign
deposits to meet cost of operation. The surplus out of which is paid
interest on bonds and dividends is deposited in and used by the
foreign banks during the intervals between the time of deposit and
the payment to bond and stock holders. If these funds were avail
able to the banks of Cuba upon the same terms as the foreign banks
secure them, a reduction in interest rate would be inevitable without
reduction in the profits of the banks.
AGRICULTURAL BANK.
There is a desire, often expressed by planters, for the establishment
of an agricultural bank along the lines of the Mexican Bank, or the
agricultural bank provided for in the recent law of the Philippine
Commission, or the Credit Foncier, of France. This proposal requires
careful study, investigation, and consideration. Among other things,
it requires decided changes in the law of mortgages and foreclosure
proceedings. There are serious objections to the Government going
into the banking and loaning business, but there are also serious
objections to the principal industries of the island being subject to
exorbitant interest rates. There has been also an insistent suggestion
from individual planters that the Government loan the planters
money directly from the national treasury. Numerous other sugges
tions have been made as to ways and means for assisting the agricul
tural interests of the island. All of these plans require study either
to give them practicable execution or to establish their impractica
bility.

51
APPOINTMENT OF ADVISORY COMMISSION OF AGRICULTURISTS.
There exists in Cuba an organization of sugar planters known as
the "Liga Agraria" (Agricultural League).. This association re
quested that a commission be selected from the membership of the
league to study, formulate, and recommend to the Government such
measures as were considered, after due investigation, to be proper and
advantageous for both the Government and the interests they repre
sent. This seemed to afford a practical and appropriate means of
securing tangible results, and the request was granted. The member
ship was extended to include representation for the tobacco planters
and a commission appointed composed of the following gentlemen:
Rafael F. de Castro, president; Gabriel Casuso, Manuel Froilan
Cuervo, Leopoldo de Sola, Eduardo Dolz y Arango, Claudio G. de
Mendoza, Luis S. Galban, Jose Maria Espinosa, Luis Marx, Lorenzo
D. Beci, Juan Maria Cabada, Roberto B. Hawley, Miguel Machado,
and Gabriel Camps.
I record with pleasure that the gentlemen tendered their services
free of expense to the Government, and, upon being informed that the
Government felt that they were entitled to compensation, replied that
their determination to render gratuitous service was irrevocable.
LOAN OF $5,000,000 TO BANKS.
Pending the solution of questions relating to the permanent im
provement of the financial needs of Cuba, an emergency arose with
reference to the supply of money for harvesting the sugar and plant
ing the tobacco crop. To meet the situation the Government offered to
deposit the sum of $5,000,000 in the local banks. The reason for the
offer and the terms and conditions are set forth in the decree author
izing the same, as follows :
Whereas the harvest season for the sugar crop, the planting season for the
tobacco crop, and the marketing season for the fruit, vegetable, and minor
crops of the island of Cuba are now at hand ; and
Whereas the planters of Cuba are accustomed to employ their credit for a
period of six months in securing the money necessary to harvest and market
the agricultural products of the island ; and
Whereas a large portion of the tobacco crop of the last season has not yet
been sold, owing to the unusual length of time required this year for the drying
and otherwise preparing said tobacco crop for the foreign market ; and
Whereas the conditions of the money market in foreign countries make it im
practicable for the banks and financial institutions of Cuba to secure all of the
money required by the necessities of the agricultural industries in the island at
this critical season of the year ; and
Whereas the financial condition of the national treasury of Cuba is such as to
permit the withdrawal, for the period ordinarily consumed in harvesting the
crops, of a sum sufficient to supply, in large part if not in its entirety, the neces
sities' of the planters and overcome the existing emergency; and

52
Whereas it is the duty of the Government to adopt such reasonable and legiti
mate measures as will assist, protect, and promote the industries of the country
and the welfare and prosperity of its citizens : Now, therefore, by virtue of the
power vested in me as provisional governor of the Republic of Cuba, I hereby
Resolve, That the sum of $5,000,000, or so much thereof as may be necessary,
shall be withdrawn from the national treasury of Cuba and deposited in banks
and banking institutions doing business in the Republic of Cuba, not to be called
for or drawn upon until July 15, 1908 ; said deposits to be on the following con
ditions :
A bank or banking institution of Cuba desiring to secure a deposit of any
portion of said funds made available for said purpose by this decree shall make
application therefor, in writing, to the secretary of the hacienda setting forth
the amount desired and kind of security offered as a guaranty for repayment
to the Government of the funds to be deposited, as well as affirmative statement
that the funds, or any part thereof, if so deposited, will only be applied to assist
ing and promoting the industries of the island of Cuba. Said application must
be presented prior to November 30, 1907, on which last-named date the secre
tary of the hacienda shall submit all applications received to the provisional
governor of the Republic of Cuba for approval or disapproval. The Govern
ment reserves the right to reject any or all of said applications, or to approve
any of said applications in whole or in part.
The application of the bank or financial institution of Cuba being approved
by the provisional governor, the treasurer of the Republic of Cuba is hereby
authorized to deposit in said bank or financial institution public funds hereby
made available for that purpose to the amount authorized by the provisional
governor of the Republic of Cuba : Provided, That said bank or financial insti
tution shall make, execute, and deliver a certificate of deposit in due and legal
form acknowledging receipt of such deposit and binding the bank or financial
institution as to the use during said period of the funds for the purposes only
heretofore specified and to return of said deposit, when called for, at any time
on or after July 15, 1908, the Government reserving the right that in the event
the deposits so made are applied to other purposes, such as for export, etc., to
withdraw the deposit at any time prior to July 15, 1908, the bank or financial
institution agreeing also to pay interest at the rate of 6 per cent per annum
for the time said deposit remains unpaid or not returned to the Government
after July 15, 1908, the bank or financial institution to have the right to return
said deposit to the National Treasury at any time without waiting to be called
upon by the Treasury : And provided further, That any bank or financial insti
tution receiving such deposit shall give collateral security for the repayment
thereof by depositing in the National Treasury approved bonds of the kind
hereinafter named and assuming the obligation to reenforce said security or
securities whenever said security or securities, on account of market fluctuation,
shall decline one point or more in value.
The following securities listed, quoted, and dealt in in the Habana Stock Ex
change will be accepted at 10 per cent less than the actual market value thereof
on the date when the deposit is actually made, but no security will be accepted
above par value:
Bonds of the Republic of Cuba, 1896-7; Republic of Cuba (Speyer) ; Republic
of Cuba, internal indebtedness ; city of Habana, first and second mortgage ; Gas
and Electric Light Company, of Habana ; Havana Electric Railway Company ;
United Railways, consolidated.
A sufficient number of said bonds must be deposited as guaranty and security
to equal the amount of the deposit, taking into consideration the 10 per cent
reduction from said market value.

53
At this writing (November 21) the banks have not submitted their
proposals, but they have made known their intention to subscribe for
all the funds thus made available.
The effect of this decree upon the public mind and business inter
ests was exceedingly beneficial, as it removed whatever doubts or ap
prehensions which existed and induced the bankers to release the
funds on hand in their banks.
The satisfaction with this measure was communicated to the Gov
ernment by resolutions of representative bodies, congratulatory mes
sages, etc. From a number received I select and quote the resolution
of the Chamber of Commerce, Industries, and Navigation of the Is
land of Cuba, as follows:
The chamber of commerce and the other financial institutions, as well as the
merchants and manufacturers whose names appear below, have the honor to
address this message to you, solemnly expressing the satisfaction felt by all
social classes. on account of the measure lately adopted in favor of the agricul
ture and industries of the Island of Cuba by the government intrusted to your
honorable direction.
One of said measures is the one recently adopted with the view of putting
in circulation for a certain stated period and without any interest the sum of
$5,000,000 from the national treasury; the end contemplated being, and no
doubt as you hope it shall be, to reinspire confidence, to facilitate operations,
and to develop the public wealth.
Kindly accept, Mr. Governor, the expressions of satisfaction which this mes
sage embodies, and the assurances of our most distinguished consideration.
STRIKES.
The industrial situation has been complicated by numerous strikes.
The first strike was that of the cigar makers. The cigar factories
had been paying wages in Spanish gold. The cigar makers and other
employees demanded payment of wages in American currency at the
same schedule theretofore paid in Spanish gold ; this meant a 10 per
cent increase in wages. The strike involved about one-half of the
factories in and about Habana. Thinking to break the strike, the
owners of the remaining factories declared a lockout. The combined
strike and lockout continued from February to July. The strikers
abstained from violence, and not a single violation of the peace, as a
result of the strike, occurred. Eventually the proprietors of the
factories against which the strike had been declared granted in full
the demands of the workmen, and a few days later the factories which
had declared the lockout made similar concessions.
Induced, doubtless, by the success of the cigar makers' strike, the
masons and plasterers demanded pay in American currency and an
" eight-hour day." These demands were denied by the contractors,
and thereupon the workmen in these trades and their "helpers"
struck. Shortly thereafter the workmen in the shops of the United

54
Railway Company at Cardenas became incensed at the superintend
ent and demanded his removal, which being denied, they increased
their demand to payment, of wages in American currency at the rates
theretofore paid in Spanish gold and an " eight-hour day." These
demands were denied by the railroad company, and the engineers,
firemen, and shopmen struck; also those of the Western Railway and
shopmen of the Habana Central.
These strikes were followed by strikes in a number of the smaller
trades, such as the box makers, plumbers, broom makers, and carpen
ters, and the strike of the masons forced manufacturers of cement,
brick, and tile to close their factories.
The striking workmen announced their intention to abstain from
all acts of violence or intimidation. There have been individual acts
of violence committed which the employers attribute to the strikers,
but the strikers deny this and insist that the employers are attribut
ing to them all violations of the peace which take place at all times
and under normal conditions. Investigation shows that the labor
unions and the workmen's association have been active and vigorous
in attempts to preserve order and prevent breaches of the peace, and
that they desire to conduct the strike without violence. There has
been, however, an increase in violations of the peace since the rail
way and masons' strikes were inaugurated, and several collisions were
reported about the middle of November. There has been considerable
ill feeling engendered. Individual strikers and knots of strikers have
hooted, jeered, and menaced men who continued to work. Several in
stances of assault and battery have been reported, and two of the men
assaulted have died from their injuries. The largest number of dis
turbances of this character have been attributed to the striking
masons. The masons' union insists that these offenses have not been
committed by the masons, and that their union discountenances vio
lations of the law. In the erection of buildings there are always a
number of " helpers " employed to shovel sand, carry mortar, stone,
brick, etc. These helpers work a few days on one job and then are
idle for a few days, afterwards seeking employment on some other
job. Generally they may be classed as irresponsible and some of them
as vicious. These joined the strike, and the authorities attribute prac
tically all of the acts of violence which have occurred to the men of
this class.
The railroads complain that old employees who desire to return to
work and new men whom they can secure are subject to intimidation
by the strikers ; that rocks are thrown at their trains ; that the track
has been greased ; that on three occasions shots have been fired • that
in several instances switches have been misplaced ; obstructions placed
on tracks, and that engines have been disabled by cutting of hose or
removal of small pieces of mechanism.

00
Shortly after the death of one of the workmen assaulted the
owner of two houses under construction made complaints against the
strike committee to the effect that they were the instigators of the
attack upon men working upon his buildings. The judge to whom
the complaint was made, upon his own initiative, caused the arrest of
213 men, including the president of the Federation of Labor; all of
whom, at the time of their arrest, were in the halls of the labor
union. These arrests were made without disturbance; the workmen
submitted quietly to the orders of the police. The audiencia ap
pointed a special judge to examine these cases, which resulted in the
release of 203 of the workmen, and the other 10 were held for trial
under bond of $2,000 each. This bond was immediately furnished
and the men released from confinement. Their cases will come before
the court in the regular order. The judge proceeded under section
567 of the penal code, which reads as follows :
Those who wrongfully combine to enhance or lower the price of labor or
regulate its conditions wrongfully, provided such combination has begun to be
carried into effect, shall be punished with the penalty of arreslo mayor.
This penalty shall be imposed in its maximum degree on the leaders and
promoters of the combination, and on those who shall employ violence or
threats to insure its success, unless they deserve a higher penalty by reason
thereof. No disorders have resulted from these arrests, and the exaggerated
accounts which later appeared in American newspapers had no foun
dation in fact. The committee of the strikers continue to advocate
a peaceful continuation of the strike and exert a wholesome control
over members of their associations, except in individual cases.
There has been an insistent demand from those accustomed to the
protection of the Spanish regime that the Provisional Government
intervene in the strikes and compel the striking workmen to return to
work; the Government, however, has declined to do this. The posi
tion taken by the Government as to the rights of the strikers was set
forth in a letter to the cigar manufacturers, from which the follow
ing is quoted:
The strikers decline to work unless paid the prices fixed by them for their
labor. This is a right which every freeman possesses. They offer no obstacles
to the manufacturers employing others ; and they have not resorted to violence
or other unlawful means of coercing the manufacturers into compliance with
their requirements. Their refusal to work may be ill advised, or based upon
imperfect understanding, or misinformation, but so long as they conduct them
selves in orderly manner as peaceable, law-abiding citizens, I can not interfere
officially, for the occasion for the exercise of official powers is not presented.
The position of the Government as to the rights of workmen who
desired to return to work, or to accept employment with employers
against whom a strike was declared, was set forth in a letter to the
civil governor of the Province of Habana, as follows :
Complaints have reached me that laborers and mechanics who wish to work
are prevented from so doing by display of force by some of the men now on

56
strike ; that such display of force consists in surrounding them, applying oppro
brious epithets to them, and urging them, in a hostile manner, not to go to work,
and otherwise intimidating them. Such intimidation is a violation of the rights
of the person affected, and he is justified in calling for the police protection of
his rights and should receive it.
A man's right to sell his labor includes the right to select his employer and fix
the price, also to deliver and perform his labor when he is satisfied with his em
ployer and wages. The law does not permit a man (in the absence of special
contract) to be coerced into involuntary servitude for an unsatisfactory em
ployer, or wages, and equally the law will not permit a man to be coerced into
involuntary idleness when he is satisfied with his employer and wages. From
this it follows that any direct or positive coercion can not be legally applied or
permitted in either instance.
I believe a large majority of the workingmen in Cuba and elsewhere recog
nize these rights and the value they are to them as well as to the community at
large. Under normal conditions these rights are apparent to everyone, but dur
ing a strike they are frequently ignored or violated by reason of .excitement,
passion, or prejudice.
You will therefore please issue the necessary orders to the proper authorities
to prevent the illegal conduct of which complaint is made and forward a copy
of the instructions issued by you to the committees of the strikers for their in
formation and guidance.
Soon after the railway strikes were declared newspaper dispatches
stated that a number of engineers and machinists had departed from
the United States for Cuba to take the places of the railroad strikers.
A committee representing the workmen called on the provisional gov
ernor to inquire if the laws permitted the landing of said reported
workmen. The immigration law of Cuba is an adaptation of the
immigration law of the United States. In both countries the impor
tation of contract laborers is prohibited. The prohibition is not
based on the fact that the incoming workmen are foreigners, or that
they seek to enter for the purpose of engaging in any particular em
ployment. The law of Cuba being borrowed from the United States,
the interpretations of that law by the courts of the United States
are authoritative in Cuba. The courts of the United States establish
that in order to exclude a workman under the contract labor law
it is necessary to establish: (1) That the immigrant, before attempt
ing to land, must have entered into a contract to perform labor in
the United States; (2) That he must have come to the United States
in actual pursuance of said contract; and, (3) That the person or
company with whom he entered into such contract must have pre
paid his transportation. Unless these three facts are established the
passenger must be permitted to land.
The chief of the immigration service was advised as to this con
dition of the law and that the questions involved were questions of
fact to be established by evidence.
The partial suspension of the railway service had occasioned much
inconvenience to a large portion of the general public, and consid-

57
erable pressure had been brought to bear to permit the landing of
the alleged " strike breakers," but the attention of the chief of the
immigration service was called to the fact that—
The laws of a country must be applied impartially, with judicial calmness,
and in accordance with established procedure, without regard for rank or sta
tion. All just governments apply the law with equal force to rich and poor,
employer and employee, and those of high or low degree. This rule must guide
us in this and all other affairs, and I doubt not will commend itself to all
Cubans and others interested in the welfare of the island."
On the arrival of the boat in which the alleged strike breakers were
shipped the chief of the immigration service examined the passenger
list and questioned the captain and purser as to whether or not there
were any passengers on board "whose passage had been paid by per
sons other than themselves, and required their written certificate as
to the facts ; he also examined each of the passengers and questioned
them as to whether they were under contract to work upon arrival
in Cuba, or whether they came to Cuba in pursuance of such contract,
and whether their passage had been paid by themselves or others.
The examination developed nothing justifying the exclusion of any
of the passengers, and they were allowed to land. The strikers made
no resistance and committed no acts of violence, but proceeded to
collect evidence, and when shortly thereafter a number of said im
migrants who were supposed to be strike breakers entered the employ
of the railways, the strikers brought the matter to the attention of
the courts by application for judicial order of deportation. The
audiencia of Habana appointed a special judge to conduct the inves
tigation ; the proceedings therein are not yet concluded.
LEGISLATIVE CONDITION.
JUDICIAL BRANCH OF GOVERNMENT  THE JUDICIARY.
The courts and judges of the island have a standing as high as do
the courts of other countries. The Cubans are deservedly proud of
their judiciary. This results from the character and ability of the
individuals who constitute the tribunals, for the codes, procedures,
and body of laws are not adapted to the form of government or the
conditions of society and business now existing. The courts of Cuba
are called upon to deal with a mass of laws quite the most complicated
of any on earth. The laws of Cuba consist of a number of laws orig
inally enacted for the Spanish Peninsula and subsequently extended
to Cuba, thereafter modified or interpreted by innumerable royal
decrees and added to by orders of Spanish military and civil gov
ernors issued in many instances with reference to special cases or
emergencies. These in turn were supplemented by the orders of the
military government established by the United States, complicated

58
by a constitution for a republic which provided that the old laws
should continue in force until new ones were enacted by Congress-
Thereafter the President of the Republic issued numerous decrees
having the force and effect of legislative enactments, and for the past
year the provisional governor has exercised the legislative authority
in numerous instances.
The judges and courts of txmntries Avhere the laws are well adapted
to conditions, every principle well established by years of harmonious
legislation, every question of practice and procedure settled by in
numerable decisions and practically all questions of law buttressed by
precedent, would view with consternation a confusion such as the
Cuban courts are called upon to harmonize and reduce to consistency.
That they have so well succeeded in this as to merit and receive the
confidence and esteem of all Cuba is not only worthy of mention but
establishes conclusively that the judicial faculty is to be found among
the Cubans and that the functions of the judicial branch of Govern
ment will be performed by Cubans equally as well as are performed
the functions of that branch in other countries, and that the defects
in the judicial system are to be attributed to the legislative and not
the judicial branch of Government.
LEGISLATIVE BRANCH OF GOVERNMENT  LEGISLATIVE NEEDS.
The constitution of Cuba was promulgated by military order on
April 14, 1902, and went into effect on May 20 following, on which
date a government under its provisions was inaugurated.
The Government under the constitution is, in theory, one of three
coordinate and independent departments — the legislative, executive,
and judicial — and in this separation of governmental power is fun
damentally opposed to the preexisting government maintained by
Spain, under which the executive branch exercised the legislative
power and was given an effective intervention in the affairs of the
judiciary. The constitution established another important innovation
in the grant it made of local self-government to the 'provinces and
municipalities, being in this respect opposed to the preexisting Span
ish system under which a very effective supervision and control over
these subordinate governments was reserved to the Chief Executive.
To complete the transition from monarchical to republican govern-
ment, legislative action upon a broad scale was urgently necessary.
The most immediate necessity was new legislation to perfect the
organization of the government under the constitution, and for the
enforcement of provisions of that instrument which were not in their
nature self-executory, and would lie dormant for the lack of it.
Next in order of importance was the revision of the existino- laws
regulating the public administration, which were mainly of Spanish
enactment, and reflected the highly centralized executive °"overnment

59
which Spain lnid maintained in Cuba. The amendment of these
latter laws was primarily necessary for the purpose of eliminating
those provisions which gave executive officials an undue intervention
in the affairs of the judiciary and in the provincial and municipal
administrations. Of less urgency, but still of great importance, was
the revision of the substantive laws in force at the time of the adop
tion of the constitution, the greater number of which were laws of the
Peninsula extended to Cuba during the decade following the close
of the ten-year war. Many of the special laws of Spanish origin in
force in Cuba had been enacted early in the preceding century, and
the code law generally between 1870 and 1890. All this legislation
required extensive revision directed toward the elimination of provi
sions dependent upon Spanish sovereignty and the union of church
and state, and its adaptation to the new conditions brought about by
the introduction of Republican government.
The First Congress elected under the constitution of Cuba held a
brief session early in the month of May, 1902, under the sanction of
a military order, for the purpose of canvassing the electoral vote
for President and Vice-President. It reassembled on the 20th of
that month, contemporaneously with the inauguration of the new
Govermnent. Its life covered the period following until April 4,
1904, when the first biennial renovation of the lower house became
effective, and the Second Congress was organized. During the period
of the First Congress the four regular sessions required by the con
stitution (article 57) were held. The first session covered the period
from May 20 to October 20, 1902 ; the second from November 2, 1902,
to March 17, 1903 ; the third from April 3 to July 18, 1903, and the
fourth from November 2, 1903, to January 19, 1904. The period
during which the First Congress was ostensibly in session aggregated
461 days, during which the lower house held 198 daily sessions, and
the senate 213 sessions. The response which this Congress made to
the urgent demands for legislation under the constitution may be
stated as follows:
1. Municipal legislation. — On July 5, 1902, Congress enacted a
law relating to the municipal administration, the sole effect of which
was to confirm and continue in office municipal alcaldes, council-
men, and treasurers who were in office on June 30 prior thereto, and
until such time as laws regulating municipal administration and
government could be enacted. It was not, however, until the third
session of the First Congress that a project of municipal law was
introduced in either branch of Congress. This project was finally
passed by the lower house and was transmitted to the senate, which
appears not to have acted thereon. No other attempts appear to
have been made to enact municipal legislation.
2. Provincial- legislation. — During the second session of the First
Congress there was enacted and promulgated the provincial govern-

60
ment act of March 10, 1903, the defects of which were speedily re
vealed. It is now undergoing revision at the hands of the advisory
commission. 3. National legislation.— -During the first legislative term of the
First Congress a project of a " Law of executive departments " was
considered and passed by the senate (September 2, 1902) and was
subsequently passed by the house in an amended form. The bill then
went to conference, where it was further amended. The conference
report thereon was subsequently rejected in the lower house, where
upon all efforts upon the part of either house to pass this particular
law appear to have ceased. During the third legislative term of the
First Congress the senate again took up the consideration of a law
organizing the central departments of Government, which it passed
and sent to the lower house, which failed to take action. This appears
to have been the final attempt made by the First Congress to supply
legislation of this character.
In other respects the attempt of the First Congress to supply legis
lation of a national character was more successful, it having passed,
in addition to the provincial government act of March 10, noted above,
laws providing for the biennial renewal of the lower house and for the
reorganization of the Rural Guard, a law of Cuban citizenship, an
organic law of the diplomatic and consular corps, a national loan
law, a law of constitutionality, a law of Presidential succession, an
electoral law, and, in addition, laws amending the notarial and cus
toms tariff act in minor regards. Regulations governing the two
houses in the enactment of legislation were also adopted.
On February 28, 1904, the elections were held for the first biennial
renewal of representatives. Those elected, with the hold-over repre
sentatives, constituted the Second Congress, which, under article 57
of the constitution, was required to convene on the first Monday of
the following April. The National, now the Liberal party, which
was in the minority in both branches of Congress, contested the cre
dentials issued to certain candidates as the result of the election of
February 27. Availing itself of the provisions of the constitution
(article 54), which required the presence of two-thirds of the total
membership of each branch to open sessions, and of the omission of
the constitution to provide means for compelling the attendance of
members, the minority party was able to prevent a meeting of the
lower house on a day fixed by the constitution, April 4. No session
of that body was held until June 13, when a quorum of one-half plus
one met and undertook to transact business. The next daily session
of the lower house was held on July 6, following. The first legisla
tive term of this Congress lasted until October 20, a period of 199
days, during which the lower house was, due to the obstructive tactics
of the minority, able to hold but 16 daily sessions. The senate met

61
?
on April 4, as required by the constitution, and began to function in
an irregular manner. Eight daily sessions were held during the
month of April, 3 in the month of May, and 1 in the month of June,
and none throughout the month of July. During the first legis
lative term the senate held but 26 sessions.
This record of both houses of Congress for infrequent and irregular
sessions continued during the three remaining legislative terms of the
Second Congress. The four legislative terms of this Congress aggre
gated 682 days, and during this period the lower house was in session
but 118 days, and the senate but 87 days.
On December 1, 1905, there was held an election for the second
biennial renewal of the lower house. Due to the political majorities
returned in that election, the minorities in both houses ceased to be
formidable, and the obstructive tactics they had employed during the
period of the Second Congress could no longer be suc'cessf ully utilized.
The Third Congress met on the 2d of April, 1906, and did not adjourn
until the 30th of June — 89 days — during which period both houses
pursued their normal routine as to daily sessions.
During the period of the Second Congress little or no general leg
islation was attempted, and even the annual budgets failed of enact
ment. A few special laws were passed, generally carrying small
appropriations, and one act amending the tariff law in a minor regard
was enacted. The election disturbances of 1905 were undoubtedly the
principal cause of the inactivity of both houses during the final legis
lative term of this Congress. From November 15, 1905, to January 9,
1906, the senate did not hold a single session. During the remainder
of the month of January but 7 sessions were held, and in February
but 3. On the day after the final adjournment of Congress, Febru
ary 24, the attack on the headquarters of the Rural Guard at Guana-
bacoa took place, and this was followed by other disturbances which
finally culminated in the uprising in August. It was doubtless be
cause of this public agitation, which covered the whole period here
in reference, that the Third Congress, which assembled on April 2,
1906, likewise failed to enact any important general legislation.
A review of the record of all three Congresses shows 259 acts of all
kinds enacted, the general character of which is exhibited in the fol
lowing table:
Amnesties  e
Appropriations  125
Creating offices and fixing salaries  30
Exemption from customs duties  23
Miscellaneous provisions  18
Substantive laws  •  35
Repealing acts  10,
Transitory regulations  12
Total  25a

62
In the 125 appropriation acts passed there are included but two
annual budgets. Twenty-two were donations of public funds to
private individuals. The most creditable showing under this head
is to be found in the 44 acts carrying appropriations for public works,
aggregating nearly $12,000,000.
The only act of any importance classed under the head of " Miscel
laneous " is the one recognizing the validity of certain debts incurred
by the revolutionary government prior to 1899. The general nature
of the others may be inferred from one or two examples ; the act of
August 29, 1905, validating academic titles conferred by Spanish uni
versities, and the act of June 30 prescribing the formalities to be
observed at the funeral of a general officer. But two of the repealing
acts affected, even in a slight degree, the old Spanish law or method
of administration, and these operated mainly to bring about donations
from the State to individuals by waiver of obligations due.
Of the acts listed above as " Substantive legislation," the more im
portant are the 'electoral law, the law relating to armed forces, the
provincial law, all of which are now undergoing revision by the pro
visional government, and the law of the division of communal
estates, which has already been revised. In three of the five years
between 1902 and 1906, the national budget failed of passage.
The failure of the Cuban Congress to make any adequate response
to the urgent demands for legislation under the constitution, and by
way of revision of the existing laws, is to be attributed in consider
able degree to the political dissensions and disturbances noted above.
There is to be considered also, as operating to the same end, the lack
of experience of the Cuban people in legislative work. During the
four centuries of government which preceded the establishment of
the Republic the laws of Cuba were promulgated from Madrid, and
the participation of the Cuban people in their government was limited
mainly to the administrative side. This lack of experience in legisla
tive work has operated to a greater extent, I apprehend, than the
political dissensions and disturbances above noted in defeating the
legislation which was required for the organization and administra
tion of the new government. That this failure of the Cuban Congress
to legislate under the constitution was a potent cause in bringing
about the conditions which made the insurrection of 1906 possible is
sufficiently evidenced by the fact that nearly all the bases of settle
ment between the warring factions proposed during the period of
deliberations which led up to the establishment of the provisional
government incorporated more or less urgent demands for legislation
of this character, and particularly for legislation under the constitu
tion affecting municipal and judicial administration.
To meet this demand for legislative action, and in pursuance of the
plan of the peace, on December 24, 1906, decree No. 284, creatine the

63
advisory commission, to which I have above referred, and charging
them with the duty of preparing projects of (1) an electoral law;
(2) provincial and municipal laws; (3) an organic judiciary law,
and (4) a civil-service law. This legislative programme has since
been extended by me to include a law of executive departments for
the organization of the national administration, an organic law of
the armed forces, and a revision of certain designated portions of the
mortgage and notarial laws. As already stated, the Commission will
shortly have ready for promulgation an electoral law, a judiciary
law, and a municipal law, including the law of municipal taxation
and accounting ; and considerable progress has been made in the draft
of a civil-service law and law of executive departments. At the sug
gestion of the advisory commission, which, I think, represents a
public demand, I shall soon convene a special commission for the
revision of the penal code and the code of criminal procedure.
The foregoing measures when enacted into laws will constitute a
substantial and important advance in supplying the legislative needs
of the Republic, but they must be supplemented by numerous other
laws of equal, if not greater, importance before the existing emer
gency is met or the necessities of the Republic met. There is nothing
more indispensable to the establishment, stability, and maintenance
of the Republic of Cuba than to do away with or reform the body
of monarchical laws inherited from Spanish dominion and by refor
mation or new enactment provide a system of laws which will render
the constitution effective and are adapted to a Republican form of
Government and the conditions of modern . thought and business,
political, and social relations prevailing in Cuba.
The character and extent of this work is well stated by Col. E. H.
Crowder, U. S. Army, adviser to the department of state and justice,
in his letter transmitting the report of the department of state and
justice, to which letter attention is directed.
Since the inauguration of the Provisional Government the neces
sity for numerous provisions of special application to administrative
organization and details of government, as well as matters of finance,
public order, and protection of property rights, sanitation, and police
powers in general, has resulted in the issue of a number of executive
and legislative decrees by the provisional governor. Those of a legis
lative character modifying or superseding prior existing laws may
be briefly epitomized as follows :
1. Disbursement and audit. — Decree No. 8, October 8, 1906, pro
vided additional laws and regulations governing disbursement and
auditing of funds and payment of expenses of the provisional gov
ernment on authority of orders of the provisional governor.
2. Prosecution of soldiers, sailors, and marines serving in Cuba for
violation of Cuban laws. — The exceptional and novel conditions of

64
the service of the United States Army and Marine Corps in Cuba
suggested the inadvisability of subjecting the members thereof to the
criminal jurisdiction of the ordinary courts. Accordingly, decree No.
16, of October 11, 1906, was issued recognizing the jurisdiction of
courts-martial for the trial of United States soldiers, sailors, and
marines for offenses against Cuban laws when such offenses were
committed under circumstances prejudicial to the good order and dis
cipline of these services, but providing that as to offenses against
said laws committed by them under other circumstances jurisdiction
should vest in provisional courts to be convened from time to time
by the provisional governor and to be composed of commissioned offi
cers of the several branches of the services named. These provisional
courts in imposing sentences are governed by the penal code of Cuba.
The ordinary courts of Cuba are divested of jurisdiction in the ex
cepted cases, but the decree does not carry immunity from arrest by
Cuban officials for crime and breaches of peace committed in their
presence, or where a party is escaping from the scene of his illegal
act. Supplementary to this decree another, 174 of July 12, 1907, was is
sued imposing penalties against those persons not members of the
services named who failed or refused to eomply with subpoenas of
general court-martial to appear and testify as witnesses, said penalties
to be enforced by the local courts.
3. Claims. — Decree No. 158, November 22, 1906, created a commis
sion and prescribed methods of procedure for the investigation and
adjustment of claims against the government arising out of the re
cent insurrection. The effective and systematic work of this Com
mission, elsewhere noted in this report, promises the early settlement
of all these claims.
4. Amendment of law of charities. — By decree No. 452, April 23,
1907, a modification of law respecting rights of guardians and family
councils over minor children is made, so far as these rights were ap
plicable to destitute orphans under the care of the state.
These rights are transferred to the secretary of the board of chari
ties, and the reasons for such transfer seem obvious when considered
in connection with the obligations of the state to these orphans.
5. Expropriation. — Decree No. 595, May 22, 1907, extends the rights
of expropriation or condemnation of property as granted by order
No. 92 to railroads in case of public works df the state, and prescribes
the processes of condemnation proceedings by the state when requir
ing either private property or property of provinces and municipal
ities not dedicated to a public use for public purposes. It was made
advisable by the many improvements and constructions of public
works in progress and in contemplation.

65
6. Demarcation of estates in common. — There are in the eastern
provinces of Cuba many large unsurveyed estates held in common,
the division of which has for a century been regarded as necessary
for the public interests. From 1819 to 1902 the provisions of the
" Voto consultivo," a resolution of the audiencia of Puerto Principe,
were applicable to their demarcation. After January 1, 1886, when
the code of civil procedure went into effect, it was found that article
2069 of that code was a menace to the final effectiveness of any such
proceedings, and for this as well as other reasons the settlement of
land titles came to a partial standstill near the close of the nineteenth
century. In order to provide a clear and simple method for that class
of proceedings, order No. 62 of 1902 was promulgated. Article 80 of
the order repealed all other laws relative to the demarcation and divi
sion of rural estates, except such provisions of the code of civil
procedure as were not specifically amended.
There can be no doubt but that the intention in promulgating that
order was to provide a means, for surveying and partitioning all
classes of rural estates. The preamble to the order in question indi
cates such intention, and the interpretation and application of the
order by courts and litigants from 1902 to 1906 point in the same
direction. The wording of several articles, however, led the supreme
court to hand down a decision limiting the estates which may be sur
veyed and divided, according to order No. 62, to those which are cir
cular in form and at the same time originated either mediately or
immediately in royal grants.
It was made to appear from the suggestions of interested parties
that there were many estates in Cuba, still unsurveyed and undivided,
in which these two requisites were not found. It further appeared
that proceedings had been instituted under order No. 62 for the sur
vey and partition of estates not circular in form and not derived
from grants ; that this was done as a result of a liberal construction of
the order, and possibly by reason of the tacit consent of interested par
ties ; that thousands of dollars had been expended in this class of liti
gation, and that the construction placed upon the order might result in
a loss of all the time and money thus expended and remand the par
ties to the condition in which they found themselves in 1902, in that
pending proceedings in which these defects were present might be
annulled upon motion to that effect, and that even completed demar
cations and partitions might be subject to attack. There arose a
demand for an amendment to said order 62 which would make .the
order applicable to all rural estates and prevent, as far as possible,
the undoing of nearly all that has been accomplished during the
period the order had operated.
23706—08  5

66 .
Accordingly decree 566, of May 17, 1907, was issued, extending the
provisions of said order 62 to the partition of lands belonging to
tenants in common, whatever might be the conditions of such tenancy
in common, and whether or not the titles to said lands proceeded
from grants to the original owners, and providing further that no
proceedings theretofore had in any case to which said order 62 had
been applied should be attacked, annulled, or declared invalid for
failure to present a grant of the property in question. The effects of
the order have proved most beneficial. The time limits in which
actions for partitions of the character here in reference may be
brought and in which such actions may be completed have been
extended in the decree No. 1080, of November 9, 1907.
7. Sanitation. — One of the most important questions presented to
the provisional government was that of sanitation. The prevailing
sanitary administration was one involving a division of control be
tween the nation and the municipalities as to methods, disbursements,
and personnel. The national obligation of Cuba assumed by Article
V of the appendix to the constitution was such as to negative a di
vided administration and consequently a divided responsibility. In
recognition of this, decree No. 894, August 26, 1907, was promul
gated, transferring the administration of sanitation of all munici
palities to national control. The cause and extent of this change and
the work and accomplishments of this department are more fully
treated of in other parts of this report. By decree No. 1127, of
November 22, 1907, tke marine quarantine service was transferred
from the treasury department to the department of sanitation.
In addition to decrees of the above character, i. e., those modifying
or superseding prior existing laws, various decrees of amendatory
character were issued. Among these may be mentioned :
Decree No. 58, series of 1906, temporarily amending the railway
law in personnel of the railway commission, and providing for final
approval of its acts by the provisional governor.
Decree No. 66, series of 1907, amending the customs regulations by
authorizing the secretary of the treasury to abate or refund duties
on goods damaged or destroyed in the customs warehouses.
Decree No. 773, series of 1907, amending the consular tariff law by
simplifying the manner of drafting manifests.
Decrees No. 901 and No. 1078, series of 1907, amending the cus
toms regulations in the provisions for the entry and clearance of
vessels. Decree No. 746, series of 1907, permitting the slaughter of female
cattle, and providing that female cattle imported pay the same duties
as male cattle.
Decree No. 852, series of 1907, providing regulations for exempting
from duty the personal effects of foreign diplomats.

67
Decrees No. 822, No. 889, and No. 1101, series of 1907, settling diffi
culties which had arisen in the interpretation of the customs tariff by
fixing the duties on tar paper, cordage, braids for harness, and card
board. Decree No. 401, series of 1907, simplifying the manner of making
affidavit in petitions to take advantage of the law remitting duties on
encumbrances in favor of the state.
Decree No. 618, of 1907, approving and ratifying the convention of
the Universal Postal Union signed at Rome, May 26, 1906.
Decree No. 634, of 1907, providing the manner of registration of
deaths and marriages during the Cuban revolution.
Decree No. 900, of 1907, relative to the issuing of certified copies
of documents in the national archives.
Decree No. 908, of 1907, regulating the leaves of absence of reg
istrars of property.
Decree No. 1036, of 1907, amending the civil registry law as to
death certificates and burial permits.
Decree No. 1051, of 1907, relating to procedure for staying execu
tion of judgments.
Decree No. 882, of 1907, permitting farriers to practice veterinary
medicine in places where there are no veterinarians.
Decree No. 182, of 1907, extending terms of present school boards.
Decree No. 737, of 1907, amending the curriculum of the School
of Sciences.
Decree No. 854, of 1907, regulating the summer normal schools.
MISCELLANEOUS.
PURCHASE OF CHURCH PROPERTY.
Shortly after I assumed the office of provisional governor the
matter of the purchase of certain church property upon which an
option was held by the State was brought to my attention, and in
compliance with a letter of the Secretary of War I made an investi
gation of the options.
In the year 1842 the Spanish Government had confiscated a large
amount of property belonging to the Catholic Church; and though
a part thereof was afterwards returned, a considerable portion was
retained by the State and used for secular purposes. In 1899, when
the State appropriations for the clergy ceased, the church laid claim
to the property so retained, and commissions appointed by the mili
tary governor reported that the church was rightfully entitled
thereto. The military governor thereupon made contracts by which
a part of the property was purchased outright and options secured
upon the remainder, with the obligation to pay an annual rental.

68
The property upon which the options were so obtained was situated
in the provinces of Habana and Oriente. The Habana property con
sisted of the former Convent of San Francisco, occupied by the Ha
bana custom-house; the former University and Convent of Santo
Domingo, occupied by the Habana High School; the edifice occu
pied by the Academy of Sciences, which was entirely rebuilt during
the military government, and two ^smaller buildings. Its retention
was urgently demanded by the public interests. The Santiago prop
erty consisted of a number of annuities and rural estates.
The option for the Habana property was entered into October 23,
1901, and was for five years, while the one for the Santiago property
was entered into January 11, 1902, and was for the same period.
These options were afterwards extended to June 30, 1907. The
valuation of this property had been fixed in the contract, as well as
the rental to be paid during the time the option was to run.
The purchase of this property by the Cuban Government had been
called to the attention of the Cuban Congress by President Estrada
Palma in his annual message of 1904, as well as in another message
in April, 1905, and a special message in November of the same year,
but the Congress failed to act.
During the consideration of this matter and because of several
articles appearing in the daily press complaining that the contract
price fixed for this property was greatly in excess of its value, steps
were taken to have the property appraised by men having a knowl
edge of the value of real estate. The general average of all the esti
mates submitted by the different parties fixed the valuation greater
than that agreed upon between the church authorities and General
Wood. An inquiry was made of the church authorities as to whether an
extension of the option and lease on the Habana property could be
obtained in the event that the Government of Cuba should fail to
purchase the same before the termination of the option, but on
account of other bids having been made the church authorities replied
that it would not be practicable to extend the option further. The
investigation included only the property in the diocese of Habana
and did not cover the property in the archbishopric of Santiago. It
was therefore agreed by the representatives of the Catholic Church
that the option upon the Santiago property would be extended one
year, but the contract with regard to the property in the diocese of
Habana was carried out by the execution and delivery of a deed of
transfer and the payment of money on July 12, 1907. Public senti
ment approved of this action and all seemed pleased to know that
this long drawn-out complication was finally terminated.
An examination of the property in the diocese of Santiago will be
made before the termination of the option, but this investigation as

by
to the extent, character, and value of the property will involve much
difficulty, due to the fact that a large number of small annuities and
parcels of ground are involved, that many records of this property
were destroyed during the ten .years' war, and other records and doc
uments disappeared at the close of the Spanish-American war and
have not yet been located. It is also exceedingly difficult to ascertain
facts respecting the property oAvned by the church because the arch
bishop of Santiago is now a very old man, feeble, almost blind, and is
unable to offer any assistance in the matter, while many of the'priests
who possessed personal knowledge of this property are either dead
or have been transferred from Cuba. An effort, however-, will be
made to secure as complete knowledge of this property as is possi
ble under these circumstances, and it is hoped that an agreement may
be reached by which this much-discussed problem of church property
in Cuba may be brought to a satisfactory conclusion.
APPOINTMENT OF CLAIMS COMMISSION FOR ADJUSTMENT OF DAMAGES
CAUSED BY REVOLUTION OF 1906.
With the object of investigating and reporting on the numerous
claims filed against the Government for damages caused by the in
surgents in the uprising of last year, a claims commission was organ
ized by decree No. 180, of November 27, 1906. The commission, as at
first constituted, was composed of Maj. Francis J. Kernan, General
Staff Corps, U. S. Army, president; Mr. Manuel Landa, judge of
the audiencia of Habana, and Capt. George W. Read, General Staff
Corps, U. S. Army, recorder. With the retirement of Major Kernan
and the transfer of Judge Landa to be acting head of the department
of justice, the commission was reorganized by decree No. 811, of July
24, 1907, Captain Read was appointed president, and Mr. Antonio
del Valle y Duquesne, deputy fiscal of the audiencia of Habana, and
Second Lieut. Aristides Moreno, Twenty-eighth Infantry, U. S.
Army, were appointed members. On August 14, 1907, by decree No.
866, a number of assistants were appointed to make local investiga
tions, as follows:
Capt. James W. Furlow, Fourth U. S. Infantry.
First Lieut. J. K. Partello, Fifth U. S. Infantry.
First Lieut. Y. La S. Rockwell, Eleventh U. S. Cavalry.
Second Lieut. C. S. Donavin, Twenty-seventh U. S. Infantry.
Second Lieut. John E. Senimes, jr., U. S. Marine Corps.
Second Lieut. Charles F. B. Price, U. S. Marine Corps.
Capt. Roman Martin, Rural Guard of Cuba.
Capt. Miguel Marona, Artillery Corps of Cuba.
Capt. Ignacio Delgado, Rural Guard of Cuba.
First Lieut. Francisco Fernandez, Rural Guard of Cuba.
Second Lieut. Eugenio Dubois, Rural Guard of Cuba.
Second Lieut. Augustin Rodriguez, Rural Guard of Cuba.

70
The commission was confronted with an enormous amount of
work, which it is doing thoroughly and well. It first turned its at
tention to the claims for horses and mules carried off by the insur
gents. Of these claims there were 6,557 and the amount claimed
was $653,027.20. The amount recommended by the commission was
$296,508.84. The number of claims for miscellaneous losses and
damages was 8,194, of which 5,500 have been investigated. In these
the total amount claimed was $1,035,079.56 and the amount allowed
by the commission $441,920.55. Of these 5,500 claims many were
made by aliens, the following nationalities being represented : United
States, Mexico, Spain, Germany, Great Britain, Italy, Arabia, Tur
key, France, China, and Colombia. The amount claimed by them was
$436,413.98 and the amount approved by the commission $179,330.55.
It will be seen that the commission has made rapid progress. The
total number of claims filed has been 14,751, of which 12,057 have
been investigated and reported, leaving 2,694 pending. The total
amount claimed in the 12,057 cases reported was $1,688,106.76, the
total amount allowed by the commission in these cases being $738,-
429.39. The total amount claimed in the 2,694 cases pending is ap
proximately $2,250,000. The greater part of these claims have been
locally" investigated and depositions of witnesses taken. It is im
possible to say how much will be required to settle the pending
claims, but it is estimated that the amount will be not less than
$900,000. COST OF THE REVOLUTION OF 1906.
The direct cost to the national treasury of Cuba of the revolution
of August, 1906, is shown by the following tabulated statement. The
total amount, calculated to October 31, 1907, is $8,634,116.64.
Cost of insurrection of August, 1906.
[Calculated to October 31, 1907.]

Item of cost.

Amount.

Remarks.

Increase of Rural Guard (2,150 men)
from August, 1906, to October 31 , 1907.

$649, 822. 61
287, 460. 54
191,528.99190, 444. 64

Uniforms and miscellaneous ex
penses.
1,319,256.68
Machine Gun Company, August, 1906,
to October 31, 1907.
Do.
30, 397. 15
9, 595. 65
2, 647. 18
1, 675. 85
44, 215. 83
Militia forces (about 11,000 men):
Pay 
1,058,980.151,473,953.61
Maintenance, forage, equipment,
and miscellaneous.
2, 532, 933. 76
t Jl

Cost of insurrection of August, 1906— Continued.

Item of cost.

Guns and ammunition.

Horses purchased in Cuba and the

purchaf
d States

Unite

Saddles and harness 
Uniforms and drv goods 
Fortifications 
Remittances to Government agents in
provinces for fortifications, pro
visions, military supplies, and mis
cellaneous.
Two Coast-Guard vessels 
Wireless telegraph stations 
Printing and supplies 
Secret expenses 
Destruction of public bridges and
roads.
Value of claims pending for supplies
furnished to Government forces,
etc. (estimated minimum).
Amounts allowed to date bv claims
commission on claim for damages
caused by insurgents.
Value of claims for damages by in
surgents, pending in claims com
mission (estimated minimum).
Expenses of claims commission to
October 31, 1907, except railroad
transportation.
Quarters for United States Army of
Pacification, to October 31, 1907.
Total cost, calculated to October
31, 1907.

Amount.

$776, 977. 81
416, 788. 97

43,681,64
270,452,41 47, 936. 37
657, 815. 17

102, 267. 50
163, 000. 00
10, 270. 68
51, 107. 60
7, 551. 00
33, 300. 0(S

738, 429. 39

900, 000. 00

11,807.9

506, 323. 95

8, 634, 116. 64

Remarks.

By rescission of one of the contracts for arms
and ammunition, the Republic has saved
$19,040of the amount comprised in this item.
A number of these horses have been sold at
auction, the sales in the United States net
ting $18,168.86 and those in Cuba about
811,000. Over one-half of the horses pur
chased have died.

The greater part of this item was spent for
blockhouses, barricades, and other fortifica
tions.

The total amount claimed is $55,503,93. It is
estimated that the amount allowed will not
fall below $33,300.
The amount claimed was $1,688,106.76.

The total amount claimed is $2,260,000. It is
estimated that the amount allowed will not
fall below $900,000.
Disbursements continue under this item.

Do.

To this sum must be added the cost of transportation and main
tenance of the American forces in Cuba.
It is not feasible to estimate the indirect damage caused by the in
surrection, such as the check of the investment of capital, the loss of
credit, etc.

ARMY OF CUBAN PACIFICATION  UNITED STATES TROOPS.
Contemporaneously with the establishment of the provisional ad
ministration, the army of Cuban pacification, consisting of approxi
mately 6,000 men, under the command of Brig. Gen. J. Franklin Bell,
Chief of Staff, U. S. Army, was distributed throughout the island
at the various centers of population. The prompt arrival of these
troops at their stations gave confidence and encouragement and as
sisted in great measure the work of restoring order. While they
were not called upon to perform any military operations other than
the marches to their stations, their example and advice, when sought
by the Cuban people, gave proof of their sincere desire to Avork for
the rehabilitation of the Republic. Fortunately, many officers of this
army had served in Cuba during the first intervention, and for them
it was renewing old friendships and making new friends among those

72
whom they had not met before. The- distribution of troops at that
time resulted in the establishment of several posts which have been
since discontinued, and at present the army, numbering approxi
mately 5,300 men, occupies 27 stations throughout the island.
Immediately after the troops were settled at their stations they
were engaged in making an accurate topographical survey of the dif
ferent provinces, which has resulted in producing an excellent map
of Cuba and in acquainting officers and men with all parts of Cuba
and -its people. This mingling of the officers and soldiers with the
Cubans under such favorable circumstances has had a beneficial ef
fect. They were received everywhere as friends and treated accord
ingly. The officers of the army of Cuban pacification, especially of the
Medical Department, have assisted materially in the work of sani
tation, and their aid has been sought and their recommendations
carried out by the local civil authorities. Their work has now been
supplanted by the establishment of a national board of sanitation,
under whose direction the sanitation of the island is being carried on,
but its initiation and a great deal of necessary sanitary work was
voluntarily performed by officers of the army of Cuban pacification.
The conduct of both officers and men of this army has been most
commendable. No serious conflict has occurred between the soldiers
and Cubans. A few minor affairs resulting from the misconduct of
enlisted men have been treated charitably by the Cuban people and no
bad feeling has resulted. This exemplary conduct on the part of the
American army among a strange people deserves the highest praise,
and is due in great measure to the good advice and intense personal
interest of its first commander, now Maj. Gen. J. Franklin Bell,
whose personal inspection of all military posts and whose careful
explanation to officers and men of the requirements necessary under
the peculiar circumstances of their service have borne excellent fruit.
This good state of discipline has been continuous, both under com
mand of the late Gen. Theodore J. Wint and its present commander,
Brig. Gen. Thomas H. Barry.
Reports from Rural Guard officers and Cuban citizens who have
come in contact with the army of Cuban pacification are strong in
their praise of its discipline and training. Many requests for de
tachments to be stationed at different parts of the island had to be
disapproved to prevent too great a dispersion of troops.
The present high state of efficiency of this army, notwithstanding
the large number of recruits recently received, reflects credit upon
General Barry and the officers under his command. The enlisted men
of this army are held in high esteem by their Cuban neighbors, and in
general it may be said that by their good conduct and example they
have maintained the high reputation of the best type of the American
soldier.

73
My acknowledgment is due to the entire army, and especially to
General Barry, whose prompt and active cooperation has facilitated
in every way the administration of affairs in this island, and whose
activity, zeal, and constant attention to the needs of his command has
made it a power whose influence for peace and good order can not be
measured in words.
COLLISION BETWEEN MUNICIPAL POLICE OF SANTIAGO AND SEAMEN OF
THE U. S. S. " TACOMA."
The only serious disturbance of the peace involving Americans
and Cubans occurred at Santiago de Cuba on April 30, 1907, and
was caused by a collision between the local police and seamen on
shore leave from the U. S. Cruiser Tacoma. Upon investigation
it was learned that a number of seamen, somewhat intoxicated, were
returning to the dock at about 1 a. m. from a banquet at a cafe in the
city, accompanied by two civilians, one of whom proved to be a cap
tain of police, dressed in civilian clothes. One of the seamen at
tempted to take a sword cane irom this captain of police and a quar
rel ensued, in which the police captain was struck and the cane taken
from him. He then ran away, blew his whistle, and is reported to
have fired two revolver shots into the crowd of seamen, resulting in
seriously wounding one. The signal brought other policemen upon
the scene and a general quarrel took place between the seamen and
the local police, in which machetes, clubs, and revolvers were used
by the police, the seamen making use of stones, bottles, and other
available objects. The result was that 6 seamen and 1 ensign were
hurt, 1 of the seamen being severely wounded, while 1 police cap
tain and 2 policemen received slight injuries. The affair was im
mediately investigated by the local authorities; the captain and the
policemen were charged with exceeding their authority and sus
pended. Their trial has been postponed awaiting report as to the
result of the injuries received by the seamen and the response to let
ters rogatory sent to the United States. The court is now in posses
sion of the information and the trial will proceed without delay.
The affair was probably caused by the intoxication of the American
seamen and the fear of the local police in an encounter with men
much larger in stature and of greater bodily strength. While on the
part of the police it may indicate an inclination of too free use of
their weapons, it is to be explained by a lack of judgment on their
part or a lack of more careful training. It does not appear in any of
the reports that the American seamen used weapons of any kind, and
the prompt action by the local authorities in suspending and holding
for trial the policemen engaged in this quarrel shows a lively desire
to preserve peace and harmony.

74
BANDITS AND THE MASSO PAERA CONSPIRACY.
With the exception of a few cases of cattle stealing and forcible
hold-ups in the country districts, Cuba has been singularly free from
any disturbance. Not a single band of marauders has appeared in
the provinces of Pinar del Rio, Habana, Matanzas, and Camaguey.
Four prisoners in the jail at Bejucal, in Habana Province, broke jail
and were at large for a week before being overhauled, and this gave
rise to a rumor that a band was out in Habana Province. With this
exception there has been no recurrence of the " bandits " with which
these provinces were heretofore annually molested. In Santa Clara
Province, as also in Oriente, there have been three small bands during
the past year, but all were quickly pursued by the Rural Guard, who
continued the chase until the marauders were taken into custody and
placed in confinement.
Early in July rumors became prevalent of the arrival in Cuba of
one Masso Parra, a Cuban by birth, who served the cause of the
Cubans in the war of 1898, but who deserted early iri 1898 and served •
the Spanish army until its evacuation from the island. Masso Parra
arrived at Santiago de Cuba, and soon after I received visits from men
of prominence, informing me of the danger he was to peace and good
order, and advised that he be compelled to leave. I was further
informed that he had come to Cuba during the administration of
Major-General Wood, and also during the administration of Presi
dent Palma, but on both occasions was not allowed to land. He soon
arrived in Habana, but with the exception of a few notices in the
newspapers nothing was heard of him. In August information from
private sources indicated that he was conspiring to disturb the peace
and order of the island. It was learned that he had recently come
from Santo Domingo, where he had taken part in an attempted revo
lution which had failed, and at first it was thought that his attempts
to secure a following here were for the purpose of disturbing the
peace of Santo Domingo, but additional information being secured,
it was evident that he was planning an insurrection in Cuba. He had
emissaries who went from Habana to different parts of the island
fomenting rebellion, and one of these agents proved to be Lara Miret,
a former officer in the Rural Guard.
Investigation of the actions of Masso Parra and his associates
brought new evidence of their intentions. The public rumor that he
was contemplating an early uprising gained much credence early in
September. Nothing could be learned definitely in regard to the
matter until about the middle of the month, when daily reports from
secret police and other sources made it evident that some action would
soon be attempted. This conspiracy took definite shape in the form of
meetings, communications with men at different centers of popula-

75
tion, and collections of arms and ammunition. About September 24
news brought by the secret service indicated that their plans were
almost completed. The names of all the conspirators who worked
with Gen. Masso Parra were secured and an examination of all the
data available led to the conclusion that the whole movement was
being directed by a few chosen spirits under Masso Parra, while the
rest were following blindly, as tools, the orders of this revolutionist.
Through the efforts of secret police the place of meeting of this rev
olutionary committee became known, and steps were taken to secure
information as to all that passed in these meetings. It was learned
that the meeting which took place on September 25 was to be the
last one before the outbreak, and soon after this meeting was ended
on the evening of the 25th, a full report of its proceedings was made
to me.
The report revealed the intention of the conspirators to have an
armed uprising for the purpose of overthrowing the provisional gov
ernment, and to more readily accomplish this, as the forces in the
beginning would be small, it was determined to destroy bridges, burn
the property of foreigners, and kill Americans. They relied upon
securing enough dynamite from the public works in the various parts
of the island to carry on the work of destruction. These facts, ob
tained from reliable sources of information, rendered it imperative
that some action be taken at once, and it was determined that the
three leaders of the conspiracy should be arrested, hoping thereby to
prevent disturbance. As the time set for the insurrection was Sep
tember 27, it was decided to arrest these men at once, and on
the morning of September 26 the police were directed to arrest Gen.
Masso Parra, Gen. Lara Miret, and Gen. Juan Ducasse, charging
them with conspiring against the Government. The examination of
these men disclosed others equally culpable, and, by order of the ex
amining magistrate, 4 others were arrested and placed in confinement.
The immediate effect of these arrests was most quieting. Rumors
of disturbance ceased at once and the country relapsed into quietness,
with no evidence of any intended insurrection in any part. Of these
7 men General Ducasse was admitted to bail, and his case has since
been dismissed on account of lack of evidence. The other 6 men ar
rested, namely, Masso Parra, Vincente Gomez, Gabriel Guerra
Santos, Lara Miret, Manuel Vila Rodriguez, and Juan Bautista
Martinez, alias " Habanero," are still in jail awaiting trial.
I believe this attempted conspiracy was brought about solely by
the instrumentality of Masso Parra, whose life has been devoted to
revolutions. These conspirators have been placed at the disposition
of the civil courts and their trials will take place early in December.
This movement had no support whatever from the Cuban public, and
the few followers that were said to have been willing to trust to its

76
fortunes were loud in their denials after the arrest of the leaders. The
prompt arrest and confinement of those engaged in this conspiracy
has given assurance that public order and peace in the island will be
maintained, and the hearty support of the Cuban people to the sup
pression of such disturbances is evidence of their loyalty to the Gov
ernment. It is believed that the conviction and punishment of these
men will be a salutary lesson for other restless spirits, who regard as
a privilege an annual outing in the Cuban mountains when the spirit
of lawlessness moves them.
Capt. James A. Ryan, Fifteenth U. S. Cavalry, detailed as military
aid to the provisional governor, is. entitled to special mention and
commendation for his arduous and effective work in unearthing this
conspiracy and securing the evidence necessary to justify the action
of the civil authorities. Through his efforts and his direction of the
agencies placed at his disposal, the plans and personnel of this ad
venture were known to the Government from the beginning, and
sufficient evidence was collected of overt acts of rebellion to make it
unnecessary to wait for the conspirators to take to the field or inflict
injury upon persons or property.
ADMINISTRATIVE CONDITION.
EXECUTIVE DEPARTMENTS.
The work of all the executive departments during the past year was
greatly in excess of any previous year. A full and complete exposi
tion of their services is set forth in reports of the acting secretaries
transmitted with and made a part of this report. I have attempted
to summarize these reports, but find these summaries fail to convey an
adequate idea of the amount, character, and importance of the work
performed or the excellence and care of the performance. I espe
cially request careful and complete reading and consideration of these
interesting and informing documents.
The plan adopted by the Peace Commission for the administration
of these departments was to confer the duties of the heads of the
departments upon the chief clerks. They have since been designated
as acting secretaries. The plan included, also, the detail of an officer
of the United States Army as adviser to each acting secretary The
plan has worked to very good advantage and accomplished excellent
results. The acting secretaries are as follows:
Department of state, Justo Garcia Velez.
Department of justice, Manuel Landa.
Department of government, Manuel Sobrado.
Department of bacienda (treasury), Gabriel Garcia Ecliarte.
Department of public instruction, Lincoln de Zayas.
Department of public works, Diego Lombillo Clark.
Department of agriculture, industry, and commerce, Francisco I. Vildosola.

77
The United States Army officers acting in an advisory capacity
are: Departments of state and justice, Col. E. II. Crowder; depart
ment of government, Lieut. Col. E. St. J. Greble; department of
public works, Lieut. Col. W. M. Black; department of sanitation,
Maj. J. R. Kean; commanding general, armed forces, Maj. H. J.
Slocum; also department of hacienda (treasury), Maj. J. D. Terrill,
United States Treasury Department.
The American advisers serve a good and useful purpose, with the
ability and fidelity which we are accustomed to expect and secure
from the officers of the United States Army.
The acting secretaries have each and all performed the duties of
their offices with judgment, discretion, and fidelity to the principles
of good government. Their task has been difficult, for, in addition to
a great volume of varied services, they were required to readjust and
re-form the working of their departments to accord with American
ideas of administration, while the personnel were accustomed to an
established routine considerably different.
In addition to the commendable work of the heads of the depart
ments, services wTere rendered and administrative ability displayed by
the heads of the several subdivisions into which the departments
were divided ; two of them, at least, are entitled to special mention for
meritorious service — Mr. Charles Hernandez, director-general of
posts and telegraphs, and Mr. Saturnino Lastra, collector of customs
for the port of Habana.
When the provisional administration was established there were
many and constant complaints as to the inadequacy and inefficiency
of the postal and telegraph service. The cyclone of October, 1906,
practically demolished the Government telegraph lines and greatly
increased the public dissatisfaction. Mr. Hernandez was appointed
director of posts and telegraphs October 29, 1906, and immediately
entered upon a vigorous and successful endeavor to restore, reform,
and improve the service. The beneficial results of his administration
are shown in the reports of the department of government, and by the
fact that no complaints respecting the service have reached this office
for more than six months.
Under Mr. Lastra's administration of the Habana custom-house an
increased volume of work has been efficiently handled and numerous
improvements and reforms effected, among them simplified mani
fests for ships, adoption of a rule permitting ships to signal inquiries
for cargo without entering the port or payment of port charges,
repeal of burdensome restrictions on the coastwise trade and ship
ping reform in erroneous classifications of importations, adjustment
of many long-pending controversies with importers, and the estab
lishment of a better feeling and footing between importers and the
customs officials.

78
I could extend the list of those whose commendable service is enti
tled to mention indefinitely, and attention is called to this fact as
establishing that it is not at all difficult to secure Cubans well qual
ified to perform all services included in "the Executive branch of the
Government. DEPARTMENT OF STATE AND JUSTICE.
The administration of the department of state and justice is set
forth in detail in the reports of the acting heads of the sections of
state and justice, respectively. The more important features are the
following :
Section of state. — Upon the establishment of the provisional gov
ernment notice thereof was conveyed to all diplomatic and consular
agents of Cuba, and they were confirmed in their offices. The main
tenance of cordial relations with foreign representatives accredited
to this Government has continued.
An extradition treaty has been consummated with the Dominican
Republic, and the adhesion of the nation has been declared to various
conventions of international character, as follows: The convention
concerning the law and customs of war on land, the adaptation of
the Geneva Convention of 1864 to maritime warfare, and the conven
tion for the peaceful settlement of international conflicts, which were
signed at the Hague in 1899 ; the convention to improve the conditions
of soldiers wounded in the armies in the field, signed at Geneva in
1864; the second international sanitary convention of the American
Republics ; the convention and protocol of the Universal Postal Union
concluded at Rome, and regulations for the execution thereof; and
the convention for the establishment of an international institute of
agriculture in Rome, signed June 7, 1906.
The Government has attended, through its delegates, international
conferences, congresses, and expositions, including the Second Peace
Conference held at The Plague; the Fourteenth International Con
gress of Hygiene and Demography, at Berlin; the Congress of the
National Prison Association, at Chicago; the Third International
Sanitary Conference of the American Republics, at Mexico ; and the
Military and Naval Exposition, at Hampton Roads, Virginia.
On assumption of office I directed a general inspection of all con
sulates of Cuba in Europe to be made, appointing for that purpose a
consul-general as inspector of consuls. The results have been bene
ficial and are being made the basis of new regulations governing the
consular service, now being prepared in the section of state.
Various extraditions have been requested of foreign governments
which, as a rule, have been granted. The Government, on the other
hand, has in general honored the request of other nations for extradi
tions.

79
The receipts in the consulates and legations of Cuba abroad under
the consular tariff law amounted to $385,000 during the period cov
ered by this report, and collections for violations of the law amounted
to $6,421.22, making the total receipts $391,421.22. The total amount
expended in-diplomatic and consular service was $399,173.17, which
shows a contribution to this department from the national treasury
of less than $8,000.
Section of justice. — The section of justice has the supervision of
judicial administration, notarial administration, registrars of prop
erty and registration of convicts, last wills and testaments, penal in
stitutions, and judicial statistics.
Opinions on questions of law requested by the provisional governor
and chiefs of other Executive departments are rendered by this
section. An adjunct to the section is the claims commission created by de
cree No. 158, November 22, 1906, to investigate and report on all
claims against the Government arising out of the recent insurrection.
There have" been acted upon in the section of justice 2,776 applica
tions for pardon, of which 456 have been granted.
Supervision and rigid inspection of the courts of the island and of
the registries of property have been made, and summaries have been
prepared of conveyances of real estate.
Many improvements and reforms in governmental administra:
tion and amendment of general laws have originated in this depart
ment and needed legislation suggested .and drafted.
DEPARTMENT OF GOVERNMENT.
The administration of the department of government has been
through three sections, which were reorganized shortly after the
establishment of the provisional government.
Section 1 has charge of affairs relating to the department of char
ities, penal institutions, and to certain matters connected with sani
tation. Section 2 deals with affairs relating to the department of communi
cations (posts and telegraphs), public order, police, cattle registry,
copyright law, official printing, the censorship of theaters, Official
Gazette, has charge of the purchase of supplies for the department
and of the personnel, the national archives, the archives of the lib
erating army, and affairs of a general character not classified in any
of the other sections. It also keeps the xecords and prepares the
decrees for the concessions of private telephone systems and electric-
power plants and makes the prescribed inspections of these.
Section 3 is intrusted with all matters connected with the organ
ization and acts of municipal and provincial governments, adminis-

80
trative appeals from local authorities, local and rural police, and
matters relating to local roads. It also supervises the awarding ot
public bids relating to the department and has charge of the statis
tics of the island.
The department of government further has charge of the secret
police and supervision over the police of Habana.
The principal work, outside of routine matters, performed by the
department has been the classification of the hospitals and an attempt
to better their administration and equipment, Many needed repairs
in the hospitals have been carried to a conclusion, and plans are rap
idly being prepared for repairs to all the hospitals in the island.
About $500,000 have already been spent or authorized for equipments
and repairs in these hospitals. The additional plans under prepara
tion will probably amount to $200,000, and it is believed that when
these are completed the hospitals in the island will have proper ac
commodation and sanitary installations for the deserving, poor sick.
The insane asylum at Mazorra was in bad condition. Its accommo
dations were for about 600 insane, yet nearly 1,600 were 'crowded into
this asylum, without beds, bedding, and clothes. One hundred and
sixty thousand dollars had been appropriated on June 18, 1906, by the
Cuban Congress for enlarging this institution, but no steps had been
taken to spend this money. Practically all of this sum has been spent
under the provisional government for equipments, new constructions,
and repairs. An additional $45,000 will place this institution in
proper condition to care for approximately 2,000 insane. Plans are
being prepared for this work. The work carried out -in this institu
tion was done under the direct supervision of Lieut. Ralph McCoy, of
the Twenty-seventh U. S. Infantry.
The Correctional School for Boys was found in a thoroughly
disorganized condition. Capt. Jens Bugge, of the Twenty-eighth
United States Infantry, was placed in charge of this school, and
under his supervision it was partially reorganized and equipped,
and the boys put back to work in their schools, work shops, and on
the farm.
The Correctional School for Girls at Aldecoa has had extended
repairs made to the buildings, the roofs of which were in a dangerous
condition. A new house has been built for the sisters in charge of
this school. Additional land has been acquired from the municipal
council at Habana, the institution has been placed in thorough repair,
and at present can take care of 250 children.
The penal institutions hftve been inspected and they are fast being
repaired, given proper sanitary installations and equipped with
beds, bedding, and clothes for the prisoners. One hundred and
seventy-one thousand five hundred and twenty-five dollars have been
appropriated for the above purposes, and this work is in a satis-

81
factory state of progress. The department of public works is at
present engaged upon plans for a new jail at Santiago de Cuba.
The department of posts and telegraphs has, as above stated, been
excellently administered by Col. Chas. Hernandez, who was ap
pointed director-general of communications on the 29th of October,
1906. During the year of his incumbency the mailing and distrib
uting force has been thoroughly reorganized, telegraph lines through
out the island have been repaired and extended, 26 new post-offices
have been created, 53 new money-order offices established, contracts
have been made with the P. and O. Steamship Company so that
mails can be sent almost daily to the United States, a system of par
cels post has been established in 45 offices, and the policy established
of appointing in small towns telegraph operators as postmasters, so
that one employee could perform the duties of both offices. In the
telegraph service 32 new offices have been opened and arrangements
made for the establishment of six wireless telegraph stations which
were contracted for by the former government. These stations will
shortly be in working order. Wireless telegraphic communication
has been established between Habana and the Isle of Pines. During
the year from October, 1906, to September 30, 1907, 16 new mail
routes have been established, delivering 16,866 mails annually. The
parcels-post treaties with the German Empire and France and the
postal convention, or treaty of Rome, have been put in effect.
Section 3 is at present at work upon a map of the Island of Cuba
which will show the provincial, municipal, and barrio boundaries.
This work will be exceedingly valuable, as there has been in the past
much conflict as to the territorial limits of the municipalities. It is
expected that this work will be completed within the next six months.
A section of constructions has also been created with the proper
technique and personnel for carrying out works of construction and
repairs in the institutions or other buildings under charge of the
department of government; and it is believed that through it the
asylums, hospitals, and jails may be kept in proper repair. This Bu
reau has assisted in repairing the public buildings in Habana.
The various sections of the department have done an immense
amount of routine work, and this with a reduced personnel resulting
from the reorganization of the office. The large amount of work
found in the department which had been unacted upon, due to the
revolution of last year, has been brought to date. The chiefs of these
sections have worked intelligently and cheerfully, without regard to
hours when their services were required, and deserve this merited
recognition of services which have made the work of this department
possible. Capt. James L. Bevans, Medical Department, U. S. Army, has been
on duty in the department since October 31, 1906. He has had charge
23706—08  6

82
of the work connected with charities and penal institutions. The
work coming under his supervision has been executed with energy
and efficiency. TREASURY DEPARTMENT. J
The report of the treasury department shows that the collection
of public revenues from all sources has been maintained at a good
figure and that the condition of the treasury of Cuba is prosperous,
a situation due in great measure to the proper and intelligent direc
tion of the treasury officials.
The treasury department comprises thirteen bureaus to which mat
ters of the utmost importance are intrusted. They are :
The central comptroller's office, which keeps the accounts of re
ceipts and collections of public moneys in methodical and systematic
order. The general auditor's office, which audits accounts as to expendi
tures and receipts, carefully supervising the handling of public funds
by the various departments of the Government,
The treasury, which has the keeping of the public funds.
The central paymaster's office, which pays the salaries and ex
penses of the central government departments and of such offices as
are not paid by the local fiscal zones.
The bureau of statistics, which collects and publishes data relative
to commerce and trade, agriculture, industries, immigration, local
finances, and other matters of general interest. During the past
year it has published interesting pamphlets giving figures in regard
to the sugar crop, the consumption of cattle and the cattle industry,
importations and exportations, immigration, and municipal budgets.
The quarantine service, which has made constant and efficient ef
forts to prevent the introduction into the Republic of quarantinable
and other contagious diseases. The officers of this service at all ports
have during the past year inspected 4,473 ocean steamers and 402,688
persons, vaccinated 8,774 persons, and committed 328 cases of sickness
to the hospitals. The quarantine service has (on November 22, 1907)
been transferred to the department of sanitation.
The customs bureau, which is one of the principal bureaus of the
Government, having supervision over all the custom-houses of the Re
public. By constant vigilance it has maintained a uniformity of in
terpretation among the customs officials of the island as to the correct
classification of goods under the customs tariff and as to the applica
tion of the customs regulations. For the purpose of correcting errors
the bureau makes a careful and minute examination of all entries and
other documents forwarded by the various custom-houses, the num
ber of entries examined and verified from September 29, 1906, to

83
September 30, 1907, being 149,142. This bureau includes the division
of protests, navigation, and revenue cutters, which has done good
work. The bureau of special imposts, which is charged with the collec
tion and administration of the internal-revenue taxes provided for
the service of the $35,000,000 Speyer loan. New rules of procedure
have been adopted to make the work more effective, and the bureau
has, during the time covered by the report, collected a total of
$4,050,859.20. The immigration i-ervice, which supervises immigration into the
island according to the immigration law. During the year the immi
grant camp at Triscornia, near Habana, has been maintained in per
fect sanitary condition and its accommodations increased.
The bureau of state property and legal affairs, which keeps the
necessary lists of real property belonging to the State, and supervises
the administration of the same, advises the various officials of the
treasury department in legal matters and investigates and verifies the
payment of conveyance taxes in the fiscal zones. This bureau has
been engaged in a thorough investigation for the ascertainment of all
real property of the State.
The bureau of revenues and imposts, which has the inspection of
municipal budgets and accounts, and of the collection of territorial,
industrial, corporation, and other taxes.
The central army pay office, which has charge of disbursing to the
persons authorized the amounts of the two loans contracted for the
payment of the Cuban army of liberation — the army which carried
on the war of 1895-1898.
And finally, the bureau of miscellaneous affairs and office of the
secretary, which has charge of matters pertaining to the personnel and
keeps the records of the department.
All of these bureaus have had a very large amount of routine
work, which they have well performed. Their several reports con
stitute an interesting exposition of the work done. They are accom
panied by a number of tables giving detailed data as to the amounts
collected and disbursed, the items of revenue and disbursements, the
state of the Treasury, foreign trade, immigration, municipal budgets
and routine work.
The acting secretary recommends the establishment of new immi-
o-rant and quarantine stations at Santiago de Cuba, Nuevitas, and
Cienf uegos ; the pressing of the work of investigating and register
ing in the registers of property, the real property belonging to the
state • the free cancellation of " censo " annuities pertaining to the
state • and the sale of such real estate as was forfeited to the Govern
ment for overdue taxes, ordered returned to its owners by a military
order of 1899, but has not been so restored.

84

DEPARTMENT OF PUBLIC INSTRUCTION.
The department of public instruction is divided into two sections,
primary instruction and superior instruction, the latter subdivided
into two departments, the institutes and the national university.
The state also supports, in connection with its section of superior
instruction, the school of arts and trades, the school of painting and
sculpture, and the national library.
For primary instruction there are over 3,700 public school teachers,
about 130,114 pupils enrolled, and 106 Boards of Education on. the
island. The armed movement of August, 1906, produced dire results in the
school attendance. Except in a few important cities the attendance
dwindled to insignificant proportions, and in the rural districts of
Pinar del Rio and Santa Clara provinces it practically ceased. The
Department spared no effort to remedy the situation. Special school
inspectors were appointed and the necssary school material furnished,
and by December 1 the school attendance was raised to its former
standard, as appears from the following table:

Province.

Attendance for the month of Decem
ber in 1905 and 1906.

Total 1906.

Total 1905.

In
crease.

De-

White.

Colored.

Male.

Female.

16, 346
12,473 8, 495
15, 211
4,5768,140

6,6816,581
6,014 7,075
1,016 3,693

12, 269
10, 021
7,437
12,225 2,9577,101

10, 758
9,0337,072
10, 061
2,635
4, 732

23,02719, 054
14, 509
22,286 6,592
11,833

21,24019, 288
14, 421
25,043 6,246
11, 291

1,787

Santiago de Cuba 
234
88
2,757 654
542
Total 
65, 241
31,060
52, 010
44, 291
96, 301
97, 529
1,228
Since then the attendance has been up to the average standard.
The most important steps in connection with the public schools have
been the movement toward the grading of the schools in a pedagogic
and scientific manner, the number of special branches taught and the
wider scope given to those which already existed in the schools of
Cuba. In the school term of 1905-6, the following special branches
were taught: Kindergarten, sloyd in wood, and physical training.
During the past year the following special branches have been added :
Lace work, sewing and pattern work, drawing and modeling, sloyd
in cardboard, sloyd in metal, and music.
The normal education of teachers is receiving serious attention and
an elaborate plan for high schools has been matured by the board of
superintendents. The principal institutes, one in each province, prepare their pupils
for the degree of bachelor. The professors, by virtue of the law of
July 11, 1906, have had their salaries increased, special appropria
tions have been made for the purchase of scientific material, and ex-
85
animation methods have been rendered less cumbersome and compli
cated for both professors and scholars. The state contributed the
sum of $268,860 for the maintenance of the six provincial institutes
during the past year.
The national university receives $357,358 from the state. It is
divided into three faculties — Belles letters and sciences, medicine and
pharmacy, and law. At the request of the university some changes
have been effected in its course of studies, in the division of its facul
ties, and in the degrees which it confers. Among the most important
may be mentioned the division of the faculties of science, the amplifi
cation of the school of agronomy, the right to confer the degree of
doctor of dental surgery, the installation of a department of X and
Finsen rays and a clinic at the " Mercedes " Hospital, and the con
struction of new and spacious buildings on the university grounds.
The salaries of all the professors have been increased in' compliance
with the law passed by the Cuban Congress on July 11, 1906.
The School of Arts (manual) and Trades, which the military gov
ernment of intervention raised to a high degree of excellence, has been
amply provided for. An appropriation of $41,000 has been made for
this institution, which provides both day and night instruction, and
turns out skilled workmen and artisans.
The state contributes $16,060 toward the School of Painting and
Sculptures, at which over 500 pupils are enrolled this year. Among
the changes introduced has been the appointment of a woman teacher.
for the female pupils in the class of anatomy and drawing from the
living model.
The national library was founded by General Wood. Its personnel
has recently been reorganized and increased, and to-day its shelves
contain over 40,000 books. The state annually contributes $11,660
toward its support, DEPARTMENT OF PUBLIC WORKS.
The work of the department of public works covers, in general,
public works of all kinds executed with state funds, and also the
investigation of petitions for concessions to private parties or cor
porations for works of public utility, or those involving the use of
the public domain. The works are carried on and materials are
bought under contract or otherwise, as may be most economical and
advantageous to the Government, under the same regulations as pre
vail in the public works of the United States.
At its last regular session the Cuban Congress had made liberal ap
propriations for public works, covering 423 specific works, of which
46 had been started prior to the establishment of the provisional gov
ernment. In measure as the state of the treasury became known, and

86
the expert personnel of the department, increased, more works were
begun. During the period from July 1, 1907, to September 30, 1907, the
total payments of the department amounted to $8,420,677.45.. The
monthly averages of payments were : July to September, 1906 (Palma
Government) , $329,141.78 ; October, 1906, to June, 1907 (provisional
government) , $534,588.90 ; July to September, 1907 (provisional gov
ernment), $873,984. During October, 1907, the payments aggregated
$1,193,780.31. These averages reflect the gradually increasing work
of the department.
The increase of work required a large increase of personnel. As
far as possible this increase has been made up of residents of Cuba.
When the available supply of technically trained men in the island
had been exhausted, engineers were engaged from abroad, mainly
from the United States, as permitted by law. On September 30,
1906, the technical force numbered 251; on September 30, 1907, it
numbered 484. Officers and enlisted men of the Engineer Corps of
the United States Army have also rendered notable assistance.
The work of the department may be summarized as follows :
Roads and bridges. — At the end of the Spanish rule in the island
there were 256 kilometers of highways in existence. Work of road
construction was begun by the military government of intervention
and continued under the Republic. On September 30, 1906, the mile
age had been increased to 610 kilometers, and on September 30, 1907,
to 786 kilometers. On the latter date 697 kilometers were under con
struction, the greater part of which will be completed by the end of
the current fiscal yar, making a grand total of 1,484 kilometers with
all bridges and culverts required.
Important highways are given a crowned metaled width of 5
meters, with drainage, ditches, culverts, and bridges. Telford ma
cadam is used where the soil is soft or drainage is poor. These are
termed " macadam roads " or " highways." Less heavily traveled
roads are drained, graded, crowned, and provided with culverts and
bridges and are metaled only where the ground is soft. These are
termned " improved roads." The figures shown ' in the preceding-
paragraph include both classes of roads.
The highways cost from $6,500 to $15,000 per kilometer, according
to the difficulty of obtaining suitable road metal, and the nature of
the country. Efforts are being made to reduce the cost by the intro
duction and extensive use of road machinery.
The congressional appropriations for road work were made in com
paratively small amounts and for widely scattered localities, with the
result that several years were required to complete a road between
two objective points ; the contracts were too small to warrant the pur
chase of expensive plants, and the roads when constructed did not

87
connect into a well-considered system which could be maintained eco
nomically. In April, 1907, a definite programme was adopted for
the construction or improvement of 2,301 kilometers of roads at an
estimated cost of $13,000,000, to be expended during a period of three
years. In addition to this, as funds are available, the short stretches
of roadway begun with congressional appropriations and not included
in the general programme are to be extended to their various ob
jectives. In addition to the roads above provided for and which are
those of most immediate necessity, the need for at least 3,000 kilo
meters more can now be seen. In the absence of a sufficient number
of civilian experts, by authority of the commanding general of the
army of Cuban pacification, 89 kilometers of road in Pinar del Rio
are being constructed under the supervision of the officers and men
of the Third Battalion of Engineers, U. S. Army, under the command
of Maj. M. Patrick. The tables appended to the report of the acting
secretary show fully the status of the road and bridge work of the
island. Besides the large number of bridges included in the general appro
priations for roads, separate appropriations have been made since
January 1, 1906, for 79 bridges. Of these, 9 have been completed, 59
are under construction, and 11 are under study.
Harbors. — Works of improvement are in progress in the harbors
of Habana, Matanzas, Cienfuegos, Santiago, and the Isle of Pines.
A project for extensive betterments in the harbor front of Habana has
been prepared, as well as projects for work in a number of other
ports and channels. Two new dredging plants have been contracted
for and will soon be ready for work. It is proposed to carry on this
work as fully as funds permit.
Aids to navigation. — The existing light-houses are 34 in number.
During the last year 1 new light-house has been built, 13 repaired,
buoys and beacons repaired and reestablished, the installation of the
improved lighting system continued, and the construction of 6 new
light-houses authorized, of which 2 will be begun during this fiscal
year. Sanitation. — In the absence of a national department of sanitation
Congress had made appropriations for certain of the sanitary work
in 16 cities, outside of Habana, to be carried on by the department
of public works. This work has been carried on generally by admin
istration, and good results have been accomplished. In measure as
the new department of sanitation perfects its organization the street
cleaning work and work of collection and removal of garbage will be
assumed by it. Since the beginning of the military government of
intervention all of the municipal engineering works in the city of
Habana have been carried on by the State. The city is clean and its
streets are in as good condition as the character of the pavements

will permit. Details of the work done can be found in the report of
the acting secretary and its appendices.
The water-distribution system of Habana has been extended to the
neighboring towns and villages, including Marianao, Camp Columbia,
and Guanabacoa, under appropriations made by Congress. The dis
tribution system of Habana is defective. There is much waste and
pressures are insufficient, The acting secretary recommends that
measures be taken to avoid impending shortness of supply.
Waterworks throughout island. — Congress has made provision for
water supply systems for 16 of the towns of the island. Two have
been completed and are in operation. Contracts have been made for
work on four more. Projects for the remainder are being made. It
is the adopted policy to extend this work as far as possible.
Inundation. — Periodical floods in the Roque district of Matanzas
Province and in the Sagua la Grande Valley, having caused great
damage, Congress made appropriations for an investigation in their
cause and for the formation of projects for the protection of the
country affected. The investigations have been practically completed
and the projects made. They contemplate the drainage and protec
tion of the lands at an estimated cost of $1,724,513. These projects
will have to be undertaken in the future when funds become available.
State buildings. — These buildings had been much neglected for
several years, and at its last session Congress made appropriations
aggregating $2,396,382.67 for repairs and neAV constructions. This
required a practical reorganization of the department. Work has
been carried on under 246 projects. The average monthly expendi
tures under this head for the different periods have been: July to
September, 1906, $25,825.64 ; September, '1906, to June, 1907, $55,-
949.79 ; June to September, 1907, $87,825.23. In the new construction
an effort is made to use modern methods, but to have the design con
form to the requirements which experience has shown to be best suited
to the climate and conditions.
DEPARTMENT OF AGRICULTURE, INDUSTRY, AND COMMERCE.
The department of agriculture, industry, and commerce is divided
into four divisions, viz, meteorology and crops, forests and mines,
industry and commerce, and agriculture. Each of these divisions is
divided into bureaus. The employees of the department of agri
culture, distributed among the six provinces of the Republic, are
rendering good service and no complaints have been received for
inefficiency. The division of meteorology and crops is divided into two bureaus,
a weather bureau ( meteorology J~ and a bureau of fisheries. The
weather bureau has made observations throughout the island and

89 9
published the results of the same in a weekly bulletin and in the
monthly bulletin of the department. It is in daily telegraphic com
munication with the Weather Bureau at Washington. Such aid as
the marine officers, whether national or foreign, have asked for has
been immediately rendered. The special system of flag signals used
by the United States Weather Bureau has been adopted here. A
seismic service has been also established for the purposes of making
observations. The bureau of fisheries has been recently established
and renders very important services to the fishing industry. With
the object of assisting the bureau, a fish commission has recently been
organized. The division of forests and mines has demarcated 75 mines, con
taining in all 26,671 hectares, and has rendered decisions in a large
number of petitions and other matters affecting the mines and forests
of the Republic.
The division of industry and commerce has charge of the industrial
and commercial trade-marks, patents, and all matters relative to in
dustry and commerce. It has settled, during this year, 1,766 matters
relating to trade-marks ; has received 330 applications for patents and
decided 225, and is now organizing a special bureau of industry and
commerce. The division of agriculture has charge of agricultural statistics,
and assists in the development of the wonderful agricultural re
sources of Cuba. The work carried on by the central experiment sta
tion shows constant scientific progress, and the publications of this
station, with the other publications of the department, contribute
much to dissemination of useful knowledge concerning agriculture
and the cattle industry. The encouragement of immigration and the
colonization of immigrants are also confided to this division.
DEPARTMENT OF SANITATION.
The report of the department of sanitation shows that the excellent
sanitary work performed in Cuba under, the former military gov
ernment of intervention was due to the zeal and capacity of the indi
vidual sanitary officers, without the assistance of any national or
ganization, although assistance from the national treasury was freely
given. Upon the establishment of the Republic the municipalities
outside of Habana were thrown on their own resources, thus explain
ing the deterioration of sanitary conditions. In Habana the sanitary
services were supported by the state with great liberality, and have
on the whole been well performed.
It having become evident that there is no prospect that the munici
palities wifl be able to maintain efficient sanitary services, these have
been taken in charge by the^tate, by decree No. 894, dated August 26,
1907, which substitutes a national sanitary officer appointed by the

90
executive for the local board of health theretofore existing in each
municipality. The report of the chief sanitary officer gives the history of the oc
currence of yellow fever in this island since its introduction from
New Orleans in October, 1905, the blame for which must be divided
between the quarantine service and the department of land sanita
tion, which two services had been separated the year before, the for
mer having been transferred to the treasury department. After a
sharp epidemic in the fall of 1905 and another in the fall of 1906 in
Habana, the infection was each time extinguished in this city, but
lingered in the rural districts, where no effective machinery for ob
serving and combatting it existed.
It appeared in the spring of 1906 in the district of Bolondron,
Matanzas Province, and in the spring of 1907 in the municipality of
Nueva Paz, in the southeastern part of the Province of Habana.
During the present year the disease has been promptly extinguished
whenever it has appeared in the large cities, with the exception of
Cienfuegos, where it appeared early in August in a hospital used in
common for Cubans and soldiers of the American garrison. The sani
tary conditions of Cienfuegos were very bad, owing to the absence of
sewers and to a very deficient water supply, which obliged the inhab
itants to keep water stored in barrels, tanks, and other receptacles
that bred mosquitoes in large numbers.
Energetic measures taken by the Department brought the disease
under control within two months, only two cases of the disease having
appeared there since the 29th of September.
Yellow fever has, however, this summer shown an increased tend
ency to spread in the small towns and large sugar plantations, and
has appeared altogether in 30 different localities in the island. The
disease was, in 1901, banished from the island by measures of fumi
gation and mosquito prevention, confined to a few of the larger cities,
but a much wider extension of this "work is now necessary on account
of the rapid increase in the number of nonimmunes in the island, and
the greatly increased facilities for movement from place to place of
the floating population, including the large number of nonimmune
Spanish laborers employed in the gathering of the sugar crop and on
public works.
Effective preventive work against yellow fever in the municipal
ities outside of Habana has not heretofore been practicable, because
such measures had to be administered through local sanitary authori
ties. The nationalization of the sanitary services gives now however
the machinery for their prosecution in places where foci of yellow
fever have been established, and this has been already initiated and
will be carried on throughout the winter. To carry on such meas
ures efficiently throughout the entire island, as is being done in the

91
Canal Zone in Panama, although theoretically desirable is practically
impossible, on account of the great area of the island (44,000 square
miles) and the immense and prohibitive cost, It is hoped, however,
that it will not be necessary.
Measures have been taken during the past year to diminish the
course of tuberculosis in Habana, which is more fatal than all the
other infectious diseases combined.
The principal recommendations of this report are the transfer of
the quarantine service to the sanitary department, the carrying out
of the plans under contemplation for the sewerage of Habana and
Cienfuegos, and for a good water supply in the latter city. A de
cree transferring the quarantine service to the sanitary department
has been issued since the date of the department's report, and
measures looking to the matter of the sewerage and water supply
are now under consideration. ARMED FORCES.
When the provisional administration by the United States of
Cuba was instituted, on September 29, 1906, the forces of the Rural
Guard were found concentrated in different places throughout ¦ the
island to carry on the operations of the campaign made necessary
by the insurrection during the months of August and September.
At this time the strength authorized was 3,020 officers and men,
according to the law of October 18, 1902, with an additional 2,186
officers and men, provided by the decree of the President of the
Republic, dated August 20, 1906. This total strength of the Rural
Guard, 5,305 officers and men, was approved by an act of the Cuban
Congress of September 15, 1906, which act also consolidated the
artillery corps with the Rural Guard, all being designated " The
armed forces of the Republic."
On October 15, 1906, the national militia, which had been organized
on account of the insurrection, was mustered out of the service ; also
the additional medical officers and hospital-corps men for each regi
ment, and the personnel of the Rural Guard thus reduced to 5,170
officers and men, which was the authorized strength until the end of
the fiscal year ending June 30, 1907.
The militia had been organized in a very irregular and hasty man
ner. Many prominent citizens, most of those who took part in the
former wars between Cuba and Spain and had obtained some military
reputation, were deputized by the Government of Cuba to enlist and
equip these militia companies throughout the island, at the public
expense. For the purpose of auditing claims for supplies, etc., fur
nished the militia, a commission composed of one American officer
and two officers of the Rural Guard, has been in session at head
quarters. They have up to the present time examined 1,681 claims,

92
representing $312,961.73, and recommended payment to the extent of .
$249,302.82. One hundred and forty-one claims, to the amount of
$48,199.33, are still pending.
On October 15, 1906, when the national militia was mustered out
of the service, the Rural Guards were organized as follows: Head
quarters of the armed forces, 8 officers; first regiment, 1,734 officers
and men; second regiment, 1,714 officers and men; third regiment,
1,714 officers and men ; making a total of 5,170 officers and men.
The First Regiment, covering the territory of the provinces of
Habana and Pinar del Rio, had 15 separate posts ; the Second Regi
ment in the provinces of Matanzas and Santa Clara, 26 posts; and
the Third Regiment in the provinces of Oriente and Camaguey, 101
posts. Owing to the necessities of the uprising the troops of the First
and Second regiments had been concentrated by suppressing the
smaller posts, Avhile in Camaguey and Oriente, where the outbreak
had been less serious, it was not necessary to do. so. On June 30, 1907,
when the island had again become thoroughly tranquil, smaller posts
were reestablished, the First Regiment having 83 ; the Second 113 ;
and the Third 114. The Rural Guard on September 30, 1906, thus
had a total number of 142 posts, and a year later (September 30,
1907) a total of 315 posts throughout the island.
On July 1, 1907, the budget for the fiscal year 1908 went into
effect, and the personnel of the armed forces was increased slightly;
25 men being assigned to the general service corps, and 1 horseshoer
and 1 farrier for each troop, which makes the present authorized
strength 5,243 officers and men. This force is sufficient under present
conditions to protect the lives and property of the people, supported
by the moral effect of the presence of American troops on the island,
and the island of Cuba to-day is in a better state of peace and tran
quillity than ever before in its history.
The satisfactory conditions at present existing-dn the armed forces
are to be attributed in large degree to the intelligence, energy, and
faithful work done by the American officers detailed for duty with
the same. On two occasions, the only two of any importance, Cap
tains Wittenmyer and Dougherty themselves took the field in person
in pursuit of outlaws, and so vigorously was the campaign and pur
suit conducted that those who desired to make trouble were either
killed, captured, dispersed, or forced to surrender to the civil author
ities. The manner in which these outlaws were run down under
American supervision has been discouraging to others who antici
pated engaging in the same mischief.
The discipline of the armed forces is excellent and the requirements
for enlistment are strict. The officers show a commendable interest
in their duties. There has been gratifying good feeling between the
Rural Guard officers and men and the American troops. In many

93
instances American officers have permitted the Cuban troops to
mingle freely with the Americans at drill, in the barracks, and off
duty, with the result that the native troops have acquired much
knowledge of benefit to them.
A number of schools of instruction have been established for re
cruits, noncommissioned officers and officers. These schools have a
regular six months course and teach the requirements of discipline
and efficiency as well as the relations with the civil authorities. The
general policy followed has been not only to have an armed force of
value and credit in the present, but lay a firm foundation of efficiency
for the future.
Efforts have been made to separate, so far as possible, the work
done by the Rural Guard from that required to be done by the mu
nicipal police ; to limit and restrict the work of the Rural Guard to
what their name indicates— work in the rural districts. There have,
however, been many cases where the local and municipal authorities,
through the judges or alcaldes, have called upon the Rural Guard to
enforce law and order, but the policy is to let the local civil authori
ties feel that they should depend upon their own local police for
work within the town or city limits. The Rural Guards are required
by law to respond to any call made upon them by the civil authori
ties, but such calls are becoming less frequent all the time. Whether
in the rural or urban districts it has always been sought to maintain
the utmost harmony with the civil authorities.
Under the decree of the President of the Republic of August 20,
1906, the Artillery Corps, which had before this been a separate com
mand, was consolidated with the Rural Guard, and together they
formed the armed forces of the Republic. The Artillery Corps now
numbers 680 officers and men — 6 companies. They are all stationed
in and about Habana, with the exception of 1 company at Santiago
de Cuba. One of these companies, besides being equipped as infan
try, is a mountain-gun battery. This battery is at present in camp
with a battalion of American artillery at the annual target practice
near Guanajay. There is also attached to the artillery an additional
organization known as the machine-gun company, equipped with 10
Colt automatic guns. The Artillery Corps to-day is a reserve force,
mainly infantry, which is held in hand at Habana for local disturb
ances. The only occasion, however, which has brought this command
into service for such purpose was during a brief railroad strike at
Camaguey in December, 1906, but the mere presence of the troops
was sufficient to prevent disturbance.
What was formerly the hospital for the artillery near Cabanas has
been organized and equipped as a general hospital for the armed
forces, having 120 beds. This not only fulfills its purpose as a
hospital, but is also a school of instruction for medical officers and
hospital corps men, who come there and take a regular course.

94
The great number of horses and ponies turned in by the militia
have been carefully culled over ; those found permanently unservice
able have been condemned and sold at public auction, and the troops-
of the Rural Guard have been remounted with other animals in
better shape, the surplus horses now being held on pasture, subject to
further demand.
The general question of the equipment of the armed forces is en
tirely satisfactory. New and better contracts have been made for
rations, clothing, forage, and all essentials to a military body.
CONCLUSION.
In closing it is a duty and a pleasure to express my appreciation
of the excellent work performed by the personnel of the provisional
governor's office. The peculiar nature of the provisional adminis
tration, combining as it does executive and legislative functions, and
the prevailing tendency to look to the Executive for every kind of
assistance and relief, have entailed an enormous amount of work on
the office of the provisional governor. Scores of petitions, com
plaints, and other communications of the most varied kind are daily
received. My cordial acknowledgments are especially due to Maj.
Frederick S. Foltz, Fifteenth Cavalry, U. S. Army, who has had
charge of the office and has performed his onerous duties with com
mendable zeal and efficiency; to Capt. James A. Ryan, Fifteenth
U. S. Cavalry, and Maj. Jose Marti, Artillery Corps of Cuba, detailed
as military aids to the provisional governor; Mr. Jorge Alfredo
Belt, legal assistant in the office ; and to Judge Otto Schoenrich, who,
in addition to his duties as member of the advisory commission, has
been attached to the provisional governor's office and has rendered
valuable service.
This report would be incomplete and the statement as to the work
ings of the provisional administration inadequate, if no reference
were made to the services of Hon. Frank Steinhart, who placed at the
disposition of the provisional governor the large fund of information
respecting Cuban affairs acquired by him during nine years' service
in the island in connection with the military government, also as
agent to the War Department and later as American consul-general
at Habana. This knowledge and also Mr. Steinhart 's advice and ad
monition has been of great value, and I am indebted to him in large
measure for the solution of many intricate and important problems
with which the Government has been calledupon to deal.
Charles E. Magoon,
Provisional Governor.
The Secretary of War.

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