June 28, 1936

Sunday morning visit from Colin Hoskins. We agreed in disapproval of “nuisance taxes.” There was talk of warehouses and rural credit facilities. I asked him: “what is the use of doing these things for people with whom it is a cardinal principle never to pay back.” Very good talk in reply. Colin says sharp distinction must be drawn between debts owed to the government (taxes, credits &c.) and those to private concerns. People here do not feel a moral obligation to pay the government; in Spanish times here any broken-down Peninsular with family pull could get appointed a tax collector in the Philippines. (N.B. “tax farmer”). The Chinese, here for their part, had been brought up at home under a system of tax “squeeze”; American (Army and Havy officers &c. in spite of their oaths of office) would occasionally smuggle in goods from China. Why, then, blame the Filipinos? His chauffeur who had previously been out of employment for six months, now has 500 pesos in the savings bank. Houseboys &c carried not a centavo with them because they didn’t want to be drawn into crap games. When he was agent for the “Book of Knowledge” he sold (mostly in the Provinces) a half million pesos worth;–the 5% loss expected on payments was not reached. In selling lots for homes in Tondo etc., he finds 90% of the installment payers responsible. He had said to the Asociacion de Propietarios a few days ago that the 5% of non-payers were well-known irresponsible drifters:–and they assented. He concludes that the Rice and Corn Corporation will eventually come to building credit warehouses in the Provinces, and that generally speaking, taxes could be collected through an education of confidence in the government, so there is no real need of new taxes. (N.B. Quezon’s campaigns in the Provinces on this subject).

We agreed that the Filipinos are really a martial people, could pay for an army and wanted one. That MacArthur’s recent statement (tho belated) would have an excellent and permanent effect.


June 17, 1936

The message was excellent, and contained the following reference to agrarian reform:

In the meantime, I recommend the adoption of measures similar to those which were adopted in Ireland to solve agrarian problems there existing from time immemorial. I also recommend the immediate passage of a law authorizing the expropriation of those portions of the large haciendas which are urban in character and occupied by the houses of the tenants.

Saw the President on the balcony at Malacañan, and congratulated him on his message, though his somewhat impromptu speeches and papers are usually his best, because they give more of the ardor and passion of his personality. He called me over and kept Secretary Yulo and Justice Recto &c waiting in order to give me the following letter he had written (in long hand) in reply to mine of thanks for the trip on the Negros:

Malacañan Palace, June 17, 36.

Dear Governor:

Your note of the fifteenth is very much appreciated.

In asking you to join me in my trips I am only seeking my own pleasure and profit. Your company brings back to memory those happy days of our former association and offers me the opportunity–which I can seldom have in Manila–to get your views and encouragement on the plans I have which may be a little too advanced for some of my associates. It is a source of great satisfaction that you feel as much pleased with the trip as I am.

Yours

Manuel.

I expressed myself as very happy to have this letter. Then I took up with him his very frank and bold renouncing of the purchase of the remaining Friar Estates, and congratulated him on recanting his former views. (This is one thing I have been trying since last Autumn to spare his government.) I told him that his “Board of Arbitration” in my bill on Landlord and Tenant, as taken from the Irish Land Acts, was the Land Commission, and I had given them the power to purchase (with his approval and action by the Assembly) all or part of any of these estates; that it was better for him to have the power to use in an emergency, even if he didn’t exercise it. He agreed. I also told him that after his message a lot of the agitation and trouble would die down–he agreed. Hoped he could now induce the more turbulent tenants to move to Mindanao.

Talked with Colin Hoskins on phone about the landlord and tenant bill–he said “the failure to purchase the Friar Estates would disappoint some important churchmen.”

I took the bill down to Diokno’s office for remoulding.

N.B. on the Negros Quezon had remarked that before the arrival of the Americans in the Philippines, venereal diseases were almost unknown here. I told him with what reluctance in May 1917 I had closed the “Red Light” district of Manila, when the Commanding General of Fort McKinley brought me President Wilson’s Executive Order thereon, referring to eliminating such districts within a certain number of miles of an army post. This General was equally reluctant to act, saying: “I founded it myself in 1901 when I was Provost Marshal here”–Quezon said this closing had spread prostitution and venereal disease greatly here.

Talk with Secretary of Finance Alas on the standardization of salaries; he emphasized the view that this must be undertaken, and it was better to get it over with now, however disagreeable this may be. He admitted however that the higher salaries of the City of Manila and of Provincial Governors must also be readjusted.


May 29, 1936

A. D. Williams at my office. A few days ago, he was called before the Cabinet to advise on new taxation. Quezon wants a transportation tax on all forms of travel. Cabinet members wish to devote the cedula tax to school purposes only, thus making it more popular.

The President went today to Cabuyao, Nueva Ecija to see a new church dedicated. A. D. Williams is to take him on Monday to Silang to see the route of a new road to Tagaytay thus cutting thirteen kilometers off the run. Quezon stopped this road construction several years ago (not to favour the wishes of Aguinaldo?). Now he wants to see it go through, but says he apprehends a “kick-back” because he (Quezon) is interested in the land syndicate at Tagaytay!

Luncheon with William Shaw at Wak-Wak for Andres Soriano–about 150 men–terrific din of talking and later of noisy jazz music. One’s voice is strained trying to converse. Say with Clyde Dewitt, and had a very interesting talk over the Archbishop and his business interests here. His Grace appears to be losing all along the line.

Hoskins greeted Secretary Rodriguez as “Governor” (he was formerly so in Rizal) and remarked that a governor of a province had more power than a Secretary of Department. “Yes” said Rodriguez “especially nowadays”! He has just been replaced by Secretary Alas as President of the National Development Co.

Small dance in the new downstairs cabaret at Malacañan. The heavy rain from 5-8 p.m. had flooded parts of the Palace, which we entered on planks. Quezon appeared late. He asked me if I noticed the speed with which he signed the Executive Order proposed by Unson for transferring Engineer Island and the lighthouse service to the Bureau of Customs. This is the second time lately he has emphasized his rapid executive action–Why?


May 21, 1936

Called on Dr. Victor Clark at the Manila Hotel; he is the new economic adviser to this government. He is employed by the Library of Congress of the United States. A great traveler and observer. He is well-balanced, but perhaps a little timid. Has been here before for several visits. He now advises the Filipinos to be cautious is asking for amendments to the Tydings-McDuffie law, and adds that they may get amendments in Congress they do not want. He asked me particularly about the Rice and Corn Corporation–whether all the sales could not be taken over by one organization; I called attention to the fact that most of the rice mills and sales agencies were in the hands of the Chinos. He also told me that formerly he had been disinclined to pay any attention to “chatter politics,” but he had seen them come true in Manchukuo and in Abyssinia. He added that if the Filipinos did not develop Mindanao, some cub reporter today might suggest that that island is just what the Japanese need, and in the end they might get it. I told him of Quezon’s extreme preoccupation with this problem.

Acting High Commissioner Weldon Jones called me to his office to present his report (which I asked for on January 27th!) concerning Colin Hoskin’s proposition that the Philippine Government should purchase silver at 45 cents with some of their dollar deposits in the United States and thus make millions by seignorage. Jones had come to a definite conclusion in opposition. He said the world was too unsettled for such a move, and that any tampering with the currency in the Philippines would alarm businessmen here. He declared the Philippines must not be put on a “silver basis,” since silver is too fluctuating in value as a commodity, and the world is “moving away from it.” He added that China has just gone off silver and has joined the dollar exchange. We then discussed the possible effects of this latter move upon the Japanese. I expressed regret that England’s strenuous attempt to bring China into sterling exchange had failed. The Chinese are sticking like leeches to us, hoping to embroil us with Japan, and England is now willing to have America pull the chestnuts out of the fire; our trade with China is not worth it; Japan has already started a counter-block by setting up local customs houses in the North China block–charging only one-fourth of the standard Chinese duties, and thus intending to flood China with Japanese goods, and so threaten the stability of all loans to China held by foreigners.

Bridge in the p.m. with Nazario, Tobangui and La O.

Big dinner at the Manila Hotel given by Mr. and Mrs. Tommy Wolff as a despedida for Don Andres Soriano who is off on a visit to St Jean de Luz. Both Soriano and Colonel Hodsoll told of telephone conversations by wireless in the last few days with Juan Figueras in Biarritz!

Talk with Benito Razon just back from the United States. He had been recently with a group of Americans who expressed disapproval of the apparent change of heart in the Philippines over independence since the passage of the Tydings-McDuffie law; that this change was no doubt due to the same influence which was causing America to withdraw from activities in the Orient–i.e., the power of Japan; that the demand for free markets for the Philippines in America was based on unfairness of the sanctions in the Tydings-McDuffie law by which America keeps her free market here for ten years, and Filipinos get a free market in the United States for only five years. He agreed with me that the new series of kicks by Americans against the Philippines is based on general indifference (“we never had any good reason for being there anyway”) plus an irritation that Filipinos should have preferred independence to retaining American protection.


May 19, 1936

Three nice letters from Doria at Peking. She is thrilled by sight-seeing, but bored by all the “Main Street” personalities she meets.

Papers carry a statement by Quezon that he has arranged with the High Commissioner for a preliminary trade conference after the election in Washington. Papers guess that (Speaker) Roxas and Alunan will be sent (??).

3-5 p.m. with Survey Board–officials of the Bureau of Science there. I questioned them as to the failure of administration of the fish and game law.

Dinner at Colin Hoskins for Weldon Jones and Major General Santos; Jim Ross, Carlos Romulo, Dr. Valdes, Victor Buencamino there–all in barong tagalog. Conversation after dinner chiefly about General MacArthur and later about Japanese relations with the Philippines. Jim Ross said MacArthur was a brilliant soldier but had Napoleonic ambitions. Hoskins added he was sorry to see him here, as something always happened when MacArthur was present, and that the general only wanted or organize the Philippines Army to help the United States. Santos thinks Japan’s expansion is to continue on the mainland, and that she doesn’t want political sovereignty here.


March 15, 1936

Visit from Colin Hoskins–who said he was rather hurt that Quezon did not let him know before accepting his resignation as a director of the Philippine National Bank, but that he thought Quezon was right in Filipinizing it, and in excluding business men from the board, because “the more successful they had been, the more predatory the type.” I asked him about the sugar mill shares–he said all bank’s holdings were being bought up by Filipino interests–that the Jones-Costigan law was apt to continue, and under that, all the companies could liquidate their capital in five years, or even four. He thought very well of de las Alas, who is vigorous and yet prudent.

Luncheon at Malacañan in honor of Isauro Gabaldon who is sailing in Vittoria for six months in Spain and in Germany, where he is going to take the waters for diabetes. I was glad to see him and Quezon reconciled. Spoke of this and of Palma, to Quezon who said he was pleased to “recognize” them after giving them such a licking. Had a nice letter from Palma. He added that Gabaldon was one of the finest characters they have in the Philippines.

There were about thirty guests in the old dining room at Malacañan– the first time I had been there under the Filipino Government. I was the only American present. Former Residents Commissioner Gabaldon, Guevara, Delgado and Osias were there–also Alunan, Nieto, Gil, Montilla, Lacson etc. I sat between Mrs. Quezon and “Baby.” Mrs. Quezon told me that she had not been entertained by the Governor General in Java, and had refused to put herself forward as she was traveling incognito. It is evident that the Dutch are uneasy about the effects that Philippine independence will have on the Javanese.

Mrs. Quezon and I made many arrangements for our trips in April. Quezon and his wife showed great affection for one another.

The President said he wished to attend the coronation of Edward VIII in London, and I said I would like to go with him. Said he would have arrangements made through our State Department for his accommodation in London.

I asked him whether now that he had organized his government it would operate with vigour? He was positive it will.

Asked him when he was going to inaugurate his bridge and poker club for the members of the Assembly in the new basement at Malacañan. He replied that it was not quite finished. I told him the Assemblymen were in a mood when it would be a good gesture–he answered: “Not until I have given them a licking!” I laughed, so he had to join in.


March 12, 1936

Long talk with Prautch on credit for poor people in provinces. Quezon off to Baguio.

Anderson and Clyde Dewitt at the hotel. Dewitt says Colin Hoskins is the only Democrat in Manila in favour of F. D. Roosevelt. Much talk about mines and mining and litigations depending thereon.

Our dinner for General and Mrs. Smith, Commander and Mrs. Millet, Mr .and Mrs. Le Jeune and Mr. and Mrs. Oleaga.


March 11, 1936

At office. Hartendorp uneasy because his appointment is as “technical assistant,” and not as “adviser”; fears he will be reduced to mere routine work, and is upset because he can’t see Quezon. Told him I had been unable to see Quezon myself for three weeks. Appointments are out for the Boards of Directors of the Philippine National Bank and of the National Development Co. They are completely Filipinized: even Colin Hoskins is ousted! Bank directors henceforth are to consist only of Government officials, thus freeing the bank from business interests of a private nature. Sorry about Colin who is one of the best directors the bank has had.

Saw Rafael Palma coming to take the oath of office as President of the National Board of Education. He seems pleased, and I am really glad Quezon took care of him–rare magnanimity on the President’s part!

At Manila Club for bridge, but Peters, entering the card room slipped and fell cutting his head badly and fracturing his wrist–took him to doctor’s. Only a few days ago called on General and Mrs. Holbrook and found her with a broken wrist from a fall on a slippery floor. This is a common accident here.

Admitted by affiliation as a member of Bagumbayan Lodge N° 4; I heard that our former efforts to make Americans fraternize with Filipinos had now been replaced by the necessity of persuading the poor Filipinos (Plaridel Temple) to fraternize with the “aristocratic” lodges which contain Americans–a schism is threatened–trouble seems to have been created by Masterson, an ex-soldier who is ambitious and speaks a few words of Tagalog.

Soriano told Doria that he finds it more profitable to sell his copra (Laguna) in the open market than to send it to the nearby (San Pablo) dessicated coconut factory.


February 22, 1936

Holiday. An hour with Sam Gaches in his office where he told me at my request the whole story of the Mineral Resources Mining properties. Excellent and vivid 40 minutes talk by him on rediscovery of the ancient Chinese mines of 500-1,000 years ago in Camarines Norte. Gave all the difficulties of mining in that region (Labo) and said it might be a “flop” “but”–with a gesture–“it drives you crazy it looks so good.” Said all mines in the Philippines except those in actual operation, like Benguet Consolidated, were “hooey,” meaning, a speculation only as yet–but added he believed the Paracale–San Mauricio–Labo district was destined to become the great gold fields of the Islands.

Had a talk yesterday with Palting, who has made a survey of the executive offices at Malacañan since inauguration, and he reports four times the volume of business compared with the days of the Governors General–but, he added, this was mostly due to the different boards engaged in reorganizing the Government.

Saw also Colonel Antonio Torres, Municipal Councillor, candidate for appointment as first Filipino Chief of Police of the City of Manila. He seemed downcast and said to me “My career is ended”–I replied “No! it is just beginning”–that afternoon’s papers carried the announcement of his nomination to head the Police Department.

Saw also Dr. Calderon, Director of the Philippine General Hospital–he is old and failing–walks with a stick. He is the senior surviving appointee to office made by me as Governor General.

Long talk with Colin Hoskins on currency problems in the Philippines. He had two hours with Weldon Jones this morning on the silver purchase. We also went into constitutional questions; the United States under Roosevelt; and the administration. Colin asked why Jim Ross and I could not support Roosevelt.

Doria’s dinner here tonight. Colette Guest, Kuka Guest, Mr. & Mrs “Shiny” White, Andres Soriano, Jim Rockwell, Paco Oleaga, Evelyn Burkhart who is to marry Paco in a few days, Tony McLeod, Young Hoover, Florence Edwards and Commander MacDowell. Dinner not well cooked. Orchestra dismissed by Doria as no good, so we went on to the Polo Club dance and had a gay evening. Mr. & Mrs. Gaches had a large dinner party there on the lawn–with the Rectos and Buencaminos. Doria said the Army crowd mournfully regretted that the last stronghold of the Palefaces was now invaded. Mrs. Gaches told Doria how difficult her social-political work on the committees was, because the Filipinos with whom she served were so casual–not to say rude!