Part 15

Items of revenue and expenditures 1918 1919 1920 1921 1922 1923 Pesos Pesos Pesos Pesos Pesos Pesos

Income 45,511,037 70,957,757 73,977,000 84,289,932 63,051,435 65,952,560 Revenue from taxation 30,220,916 48,463,600 47,012,230 56,036,000 42,867,320 42,925,310 Incidental revenue 1,730,000 2,950,000 3,495,000 4,681,600 2,120,000 5,233,500 Earnings and other credits 13,560,120 19,544,157 23,469,770 23,572,332 18,064,115 13,143,750 Income from proposed legislation [8]4,650,000 Current surplus at the beginning of the year 18,996,477 33,470,664 10,560,300 11,964,152 ---------- ----------- ---------- ---------- ---------- ---------- Total available for expenditures 64,477,514 104,428,421 84,537,300 84,289,932 75,015,587 65,952,560

Expenditures 51,051,725 92,003,494 84,453,806 83,549,778 72,538,593 65,677,327 Expense of revenue collection 1,138,904 1,835,078 1,741,202 1,688,370 1,564,726 1,611,533 Operating expense of commercial and industrial units 8,002,820 12,699,877 14,089,177 14,502,504 8,981,853 7,661,867 Public debt 2,087,500 2,310,276 2,308,326 3,459,281 5,189,878 9,698,667 General administration 3,911,100 8,083,832 5,114,677 5,202,098 4,995,090 5,170,217 Protective service 8,261,259 9,696,100 11,185,108 10,373,411 9,284,643 9,393,072 Social improvement 5,680,914 7,987,190 8,498,527 9,093,423 8,818,029 8,317,816 Economic development 3,950,459 6,883,934 9,397,034 10,437,851 8,740,857 7,326,511 Aid to local governments 9,618,425 11,992,281 13,163,155 15,347,095 17,883,667 13,287,409 Retirement gratuities, Act 2589 700,000 800,000 750,000 600,000 500,000 300,000 Emergency service 1,000,000 1,000,000 3,000,000 3,000,000 2,000,000 Outlays and investments 6,700,344 14,102,181 15,206,600 9,845,745 4,579,850 2,910,235 Appropriation balances for public works [9]4,296,754 Appropriation balances for miscellaneous accounts [9]10,315,991

Current surplus at the end ---------- ---------- ---------- ---------- ---------- ---------- of the year 13,425,789 12,424,927 83,494 740,154 2,476,994 275,233

CURRENCY.--At the time of the American occupation, the Mexican dollar and the Spanish peso were in circulation in the Islands as a part of the currency. The Mexican dollar had been introduced because of the trade between the Philippines and Mexico, which was fostered by the Spanish galleons. Besides the Mexican dollar and the Spanish peso, there also circulated the silver peso or dollar of the various South American countries. For fractional currency, however, the Spanish coins predominated. The denominations were half peso, peseta, and media peseta. Gold pieces were of P1, P2, and P4 denominations.

The first mint in the Islands was installed during the reign of Isabela II. It was then that the Philippine peso, both in gold and silver, was first coined.

[Currency Legislation]

America early decided to make the currency system more stable and scientific. On March 2, 1903, Congress passed the Philippine Coinage Act which established the conant or Philippine peso as the official coin of the Islands. The effect of this Act was to drive away all the previous coins in circulation, and it is the basis of the present currency system in the Philippine Islands. The coins provided for were of the denomination of the peso, half-peso, peseta, media peseta, 5 centavos, 1 centavo, and one-half centavo, while the silver certificates were in the denominations of P2, P5, P10, P20, P50, P100, P500. The peso was issued on the basis of two Philippine pesos (P2) to one dollar ($1) gold, United States currency. To maintain the parity the Gold Standard Act was passed by the Philippine Commission in October, 1903. There are gold deposits in the banks of the United States to guarantee every Philippine Government certificate in circulation. This places the Philippines practically on an actual gold basis.

[Notes]

The notes in circulation at the time the Americans came were those issued by the Banco Español-Filipino. They were in 10, 25, 50, 100, and 200 Mexican denominations. After the introduction of the Philippine peso, P1 notes were also allowed to circulate. In 1912, this same Banco Español was allowed to change its name to that of the Bank of the Philippine Islands, and thereafter, a new series of notes were issued, having the same size as the certificates issued by the Philippine Government, but of the denominations of P5, P10, P20, P50, P100, and P200.

When the Philippine National Bank was established in 1916, it was authorized to issue notes to be known as circulating notes. In accordance with this authorization, denominations of P1, P2, P5, and P10 began to appear.

The stability of the currency system in the Philippines depends solely on the maintenance of the parity of the Philippine peso with the gold dollar on the established basis of 2 to 1. This can be easily accomplished by keeping always intact the gold deposits in the United States.

TABLE OF CURRENCY IN CIRCULATION, 1913-1922

+--------------+------------- Year | Amount in | Per capita | circulation | circulation -----------+--------------+------------- | Pesos | | | 1913 | 50,697,253 | 5.53 1914 | 52,575,118 | 5.63 1915 | 51,284,907 | 5.40 1916 | 67,059,189 | 6.86 1917 | 102,580,314 | 10.20 1918 | 131,151,883 | 12.67 1919 | 146,576,956 | 13.87 1920 | 124,589,240 | 11.56 1921 | 103,661,820 | 10.01 1922 | 97,217,468 | 9.03 -----------+--------------+-------------

ELECTORS.--The total number of electors registered in the election of June 3, 1919, was 717,295 and the votes cast was 672,722, which is a very fine percentage when compared to the interest in elections shown in other countries. In the elections of 1912, 248,154 voters registered, of which 235,786 voted. Of the number of voters registered in 1919, 407,346 possessed educational qualifications, while only 81,916 were educationally qualified in 1912. It should be noted that the Philippine voters must have either property or educational qualifications, so that these figures show the progress of the people in political matters and in education in general during the last few years. In the elections of June, 1922, there were 824,058 voters registered.

The minority party has always accepted the decision of the majority, unless it thinks that the election has been vitiated by some illegal act, in which case it takes the matter up with the courts for decision. The practice of revolutionary countries where defeated minorities take the law in their own hands or use violence against the triumphant party, or utilize every other means to hinder the working of the government, has never been resorted to in the Islands.

XIII. THE FILIPINOS IN CONTROL

[Original Policy]

The Second Philippine Commission sent out to the Philippines by President McKinley on March 16, 1900 were given the following instruction, among others:

"That in all cases, the municipal officers who administer the local affairs of the people are to be selected by the people and that wherever officers of more extended jurisdiction are to be selected in any way, natives of the Islands are to be preferred, and if they can be found competent and willing to perform their duties they are to receive the offices in preference to any others."

These instructions were confirmed by President Roosevelt when he said that the Government of the Philippine Islands would cease to be a government of Americans aided by Filipinos and instead would be a government of Filipinos aided by Americans. And in 1908 after the opening of the Philippine Assembly, President Roosevelt in his message to Congress added:

"I trust that within a generation the time will arrive when the Filipinos can decide for themselves whether it is well for them to become independent or continue under the protection of a strong and disinterested power, able to guarantee to the islands order at home and protection from foreign invasion."

[Filipinization]

In pursuance of all this policy the placing of Filipinos in government offices was hastened from 1913 to 1921, the turning over of power into Filipino hands having been virtually made complete by the passage of the Jones Law in 1916. This law provided for the creation of an elective Senate and House of Representatives and for the appointment of heads of departments and other government officials. Appointments made by the Governor-General were made to be with the advice and consent of the Philippine Senate.

The proportion of Filipinos to Americans in the Philippine Government during the period 1914-1921 is shown in the following table:

+--------------------------------+----------------------- | Number | Percentage -----+-----------+-----------+--------+-----------+----------- Year | Americans | Filipinos | Total | Americans | Filipinos -----+-----------+-----------+--------+-----------+----------- | | | | Per cent | Per cent 1914 | 2,148 | 7,283 | 9,451 | 23 | 77 1915 | 1,935 | 7,881 | 9,816 | 20 | 80 1916 | 1,730 | 8,725 | 10,455 | 17 | 83 1917 | 1,310 | 9,859 | 11,169 | 12 | 88 1918 | 948 | 10,866 | 11,814 | 8 | 92 1919 | 760 | 12,047 | 12,807 | 6 | 94 1920 | 582 | 12,651 | 13,143 | 4 | 96 1921 | 614 | 13,240 | 13,854 | 4 | 96 1922 | 604 | 13,726 | 14,330 | 4 | 96 -----+-----------+-----------+--------+-----------+-----------

[Instruments of Autonomy]

The principal agencies that gave the Filipinos effective control over domestic affairs in conformity with the spirit of the Jones Law, were the following:

1. The creation of a Council of State on October 16, 1918, to help and advise the Governor-General on matters of public importance. In this council many prominent leaders of the Filipino people have figured prominently.

2. The creation of the Philippine Cabinet by which the Government Departments were organized and the work of the Executive Department divided among them. The aim was to have them undertake the work expressly entrusted to them, and to have in each branch of the administration a head responsible for its policy and direction. Each Secretary of Department assumes responsibility for all the activities of the government under his control and supervision. To this end he has the power to initiate, the power to regulate, the power to direct and inspect, and the power to appoint and remove.

3. The several laws that had given to the Council of State and to the Chairmen of the two houses of the Legislature the power to supervise and control the execution of the laws.

4. The liberal policy followed by Governor-General Harrison in accordance with the liberal tenor of the Jones Law, a policy really preparatory for the independence of the Philippines.

Speaking of this policy, Governor-General Harrison on September 1, 1916, said:

"I firmly believe that the Chief Executive should consult the people through their representatives who are called upon to serve them. This is the very life-blood of self-government. It should never be possible for a Chief Executive--and it will now never be possible here--to ride ruthlessly over the people he has been sent here to govern, without taking into account their feelings, and without due consideration to their desires."

ACHIEVEMENTS OF THE FILIPINO GOVERNMENT.--The outstanding achievements of the Filipinized government are summarized below.

I. REORGANIZATION OF DEPARTMENTS.--The Reorganization Act, as finally passed by the Philippine Legislature (Act No. 2666 as amended by Act No. 2803), has provided the Philippine government with a more logical and scientific grouping of bureaus and offices. It has given the new department heads more authority and power over the offices and bureaus under them. They are now empowered to promulgate rules, regulations, orders, circulars, memorandums, and other instructions for the harmonious and efficient administration of each and all of the offices and dependencies of each department. Secretaries of departments may be called by either of the two Houses of the Legislature for the purpose of reporting on matters pertaining to their departments. In this case they are also responsible to the two Houses. The six departments created by the Reorganization Act correspond to the six principal purposes of a fairly well organized government, to wit:

[Functions of the Departments]

(1) The maintenance of order and political direction of local administrative units, such as departments, provincial and municipal governments, and special governments--the Department of Interior;

(2) The guardianship of the State over the mental development and physical welfare of the citizens--the Department of Public Instruction;

(3) The collection of the public revenues and administration of the finances and business of the government--the Department of Finance;

(4) The enforcement of the law and safeguarding of the citizens and their rights--the Department of Justice;

(5) The guardianship in connection with the preservation of the natural resources and the development of the country's sources of wealth--the Department of Agriculture and Natural Resources; and

(6) The carrying out of such work and services as cannot be performed by private citizens, conducive to the common welfare and public prosperity--the Department of Commerce and Communications.

II. ADOPTION OF A BUDGETARY SYSTEM.--A scientific budgetary system has been adopted. Under the system the estimates are made under the supervision and control of the department heads who have the power to add or cut down items. These different estimates are then submitted to the Secretary of Finance, who coördinates them. Any conflict between a departmental head and the Secretary of Finance is submitted to the Council of State for decision. Once the budget is definitely approved by the Council of State the Governor-General submits it with a message to the Legislature.

The lower house is the first one to take up the budget. The corresponding Department Secretary appears before it to explain the details of the budget for his Department and to answer all questions by the members. Once the budget is approved in principle it is sent to the Committee on Appropriations with instructions to draft the appropriation bill in accordance therewith. When the appropriation bill is approved by the house, it is sent to the Senate and practically the same procedure is followed.

[The Emergency Board]

To make the budgetary system sufficiently elastic to meet changing conditions, there has been created the so-called Emergency Board composed of the Secretary of Finance as Chairman, two members of the Legislature, the Insular Auditor and the Attorney-General as members. In the general Appropriation Act, this board is given a substantial amount with which to supply the additional funds that the various units of the government may need for the purpose authorized by the appropriation law. As an additional safe-guard, the actions of the Emergency Board do not become operative until after approval by the Governor-General and the presidents of both houses.

III. PUBLIC IMPROVEMENTS.--In public improvements, the following was the record of the Filipinos within the last nine years. The mileage of first-class roads was more than doubled increasing from 2,172 kilometers in 1913 to 4,782 in 1922, not to speak of the second and third class; 7,562 permanent bridges and culverts are now in existence; 725 permanent government buildings were built, including schools, public markets, hospitals, provincial capitols, and large and beautiful edifices for the university and the Insular government; a network of wireless stations was erected throughout the provinces; a vast program of improvements in port works was launched, and a bond issue of ten million pesos was sold in the United States for harbor improvements in Manila alone; irrigation works estimated to cost about ten million pesos, and designed to benefit 150,000 acres of land in sixteen different localities, were initiated; 949 artesian wells in the different provinces, an average of one to each municipality, were drilled at a total cost of nearly two and one-half million pesos, and 55 new water-works systems were installed with 36 more under active construction, to cost more than three million pesos.

IV. AGRICULTURE AND TAXATION.--The progress in agriculture was remarkable. The chief point of interest here is that the placing of Filipinos in control of the agricultural departments greatly enlarged the power of the Government to influence the people to increased production. Of rice alone, 1,285,385 acres more were planted during the last nine years (1913-1922); 544 rural-credit societies were established with a membership of 75,114 and coöperation in agriculture, a new spirit among the farmers, encouraged and explained.

Taxation was revised and increased, and the government revenue from this source which in 1913 had been only P39,236,007, rose to P62,900,403 in 1919 and P64,259,776 in 1922; there are twelve banking institutions in the Islands, now, instead of only six, and the money in circulation has risen from P50,000,000 in 1914 to three times that figure.

V. PUBLIC ORDER.--Public order, the first requisite of a stable government, has been splendidly maintained through the agency of the Philippine Constabulary and the municipal police. The Constabulary has always been dependable and thoroughly efficient. There is hardly any country in the world more peaceful than the Philippines.

VI. EDUCATION.--The present school system in the Philippines has been one of the principal uplifting agencies in the colonial enterprise undertaken by the United States as a result of the Spanish-American war. Immediately after the capitulation of Manila, an army officer acting as superintendent of schools opened schools. Everywhere the army went afterwards a public school was established and put into operation.

The school system is supported entirely from Philippine revenue. The advance has been rapid, there now being about a million pupils in the schools being taken care of by the Philippine government. The attendance of almost a million is entirely voluntary, there being no compulsory education law.

The public school system has received the unstinted support of the Filipino people. The first bill passed by the Philippine Assembly in 1907 was the appropriation of one million pesos for the building of rural schools. In 1918 the thirty million-peso act was passed, which provided that thirty million pesos be set aside, over and above the regular annual appropriation, for school-housing and equipment. The law is expected to provide school facilities for every boy and girl of school age in the Islands by 1924.

The head of the public-school system is the Vice-Governor-General who is at the same time Secretary of Public Instruction. The executive control is centered in the Bureau of Education headed by a director, who is responsible for the conduct of public schools and has the authority necessary to make his control effective.

School divisions.--The Islands are divided into forty-nine school divisions, each division generally coinciding with the boundaries of a province, except the City of Manila, and four Insular schools--the Philippine Normal School, the Philippine School of Arts and Trades, the Philippine Nautical School, and the Central Luzon Agricultural School--each of which is considered as a distinct division. A division is under the immediate charge of a superintendent who is the representative of the Director of Education. The Division Superintendent in the province is generally assisted by a provincial industrial supervisor and an academic supervisor. Each provincial division is divided into different districts consisting of one or more municipalities and several barrios or villages, each under the charge of a supervising teacher.

There are 50 provincial high schools. There are 20 provincial trade schools and 14 provincial shops, the principals of which are responsible directly either to the principal of the provincial school or to the Division Superintendent of Schools.

The original feature of all school work was the academic. Soon the Bureau of Education labored to make industrial work a part and parcel of the curriculum. This was followed by making physical education a vital part of the courses. And now the aim is to maintain a proper balance in the academic, industrial, physical, and social work.

The English language is the only medium of instruction.

There are seven elementary grades--four primary and three intermediate. The secondary courses take four years. There has been built up an English-speaking Filipino teaching staff--a distinctive achievement reflecting credit on Filipinos and Americans alike.

Vocational instruction.--Graded vocational instruction occupies an important place in the school curricula. Approximately 14 per cent of the total time in the primary grades and about 17 per cent of the total time in the general intermediate course is devoted to this form of instruction. The special intermediate vocational courses include farming and trades for boys and housekeeping and household arts for girls. The chief aims of industrial instruction are: first, industrial intelligence; second, industrial skill; and, third, industrial sympathy. The educational and economic values of industrial education are kept in view. It may be of interest to mention that the Bureau of Education annually receives orders amounting to $150,000 a year from various firms abroad, especially from America, for handicraft articles; that trade school production yearly is over $100,000 and that the yearly agricultural production of the schools is over $281,000.