10:30 AM Colonel Lehrbas aide-de-camp of General MacArthur called me by phone and told me that General MacArthur wanted to see me. I went to his office and talked to me for one hour on his plans for the reconquest of the Philippines. He gave me specific instructions to fly to Washington and transmit verbally to President Osmeña the top secret information. At 12 p.m. I returned to my office and began preparing the important papers. I have to take with me. Then at 12:45 p.m. I invited General Fellers to luncheon to discuss matters. I paid a courtesy call at 3 p.m. on Lieutenant General Lumsden British Army Liaison Officer with SWPA. He had flown to England and was received by Colonel Palmer. I brought to his attention the name of Colonel Hodsoll, former manager and co-owner of Warner Barnes Company in Manila and suggested his usefulness as an observer in Philippine affairs. Colonel Palmer said that it would be agreeable to this if General MacArthur would ask for him. At 6 p.m. I called on Mrs. MacArthur. At 6:45 p.m. I left with Colonel Soriano, and Colonel Smith to the home of Mrs. Bridge for dinner. Lovely dinner all cooked by Mrs. Bridge. I Returned to my apartment at 10:30 p.m.
Breakfast at Malacañan Palace with the President, Secretary Yulo, Carmona and architect Arellano.
Before the others arrived, I told Quezon how much I approved his appointment of Hermenegildo Cruz as Director of the Bureau of Labour, and the President replied that under the preceding administration Cruz had been “framed,” but that he (Quezon) had then advised him to resign because he had lost the confidence of Governor Murphy.
At the table, the President remarked that he was reading Professor Kirk’s new book on the Philippines, and enjoyed the first chapter so much because of the cynicism with which the author exposes the “cant” of McKinley’s government in pious profession of the “White Man’s Burden.” He added that Governor Forbes had really believed in that cliche. Quezon and I both admitted to one another that we had tried to read Governor Forbes’ book on the Philippines, and had been quite unable to do so.
After lunch, we all went down to Binondo to look at three sites for the proposed new building of the Philippine National Bank. In the business district, the crowds stared at Quezon as if he were royalty!
I enquired as to Quezon’s opinion of the present disorders in Spain. He replied that the Spanish people are not fit for self-government, and have lost the ability to carry on under a constitutional monarchy. “What they need,” he remarked “is five years of a dictatorship.”
To dinner with Colonel Hodsoll at the Manila Club; the first entertainment given by the English since the death of King George V.
Survey Board. I gave Unson a message from Quezon about the Provincial Treasurers. Advised him to bring up at once for Executive Order the transfer of these officials and also that of Engineers Island and the lighthouse service to the Bureau of Customs–in fact all the reorganization they have already decided upon. I think he is afraid he may prematurely make decisions which might have to be changed later in a more general reorganization.
Talked with Unson about nationalizing the Municipal police. He said a comment by Posadas was that if they were nationalized, the President would be blamed for all mistakes. In fact, Unson wishes to take away all administrative responsibility from Quezon–for example, he wants to put the Philippine Army under the Secretary of the Interior!
In Unson’s office I met General Alejandrino–he is no longer an “Adviser to the President”–left some weeks ago, apparently, from what he says, because he could never get to see Quezon!
Luncheon at Wak-Wak--despedida for Andres Soriano. Colonel Hodsoll asked me whether he should advise his friends to accept the government’s offer of $350 for their Philippine Ry. bonds–or go to foreclosure? I told him they would not get that much out of a foreclosure.
Sat between Dr. Tuason and Shultz, manager of the great Roxas estate at Calauan in Laguna. He has from three to four thousand employees–and in twenty-five years has had no labour troubles–never a case in court–there is now no indebtedness from his tenants to the plantation; has no bother from the Department of Labour officials. Says copra is a better price than the dessicated coconut factory pays–thinks the Philippines should stick to exporting raw materials, as they are not prepared for industrialization.
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.
Busy morning at office. Miguel Unson has seen Quezon and has received instructions that I shall work with the Government Survey Board. He came in and outlined their work. The office is at the Heacock Building, and he spends most of his time there. Is worried by the belief that insufficient revenue is obtained from the customs, and is trying to work out a scheme for improvement; he says that every time the customs bureau is investigated the revenue receipts leap up!
We talked over the issue of railway vs. roads in Mindanao: he says the plan is to take down there that useless railroad outfit in Cebu, and perhaps in Iloilo as well, and to build roads as feeders. I also saw Osmeña for a moment before the Cabinet meeting and he talked on the same subject: says the time has come to decide either for railroad or roads, and not to make the same mistake as in Luzon, where they run parallel.
Hartendorp came in, and reported that he had recently called on General MacArthur, who has an office in Santa Lucia barracks. The General told Hartendorp that he was the first editor who had called on him, and expressed surprise; he also voiced regret that Quezon’s address on National Defense at the University had not been better received, and that the press does not support the plan. He said that his plans are extremely well forward, and that the Philippine army is going to get munitions and equipment at one-quarter cost from the United States Army. In ten years, the Philippines, he believes, will have a force making it necessary for another country, if attacking, to lose a great number of men, and to spend perhaps a billion dollars, which will make them hesitate to attack. This would be very different from the picnic the Japanese had in walking into Manchuria. Hartendorp asked whether the Philippines were not rich enough to make this “worth while,” and whether these islands are not a prize because “strategically located”? The General replied that the strategic situation would bring in other allies–especially the United States. Seemed positive of that. He also remarked that Quezon was one of the five great statesmen of the world.
Hartendorp reported that Quezon had cut his Friday press audiences four times running–“doesn’t seem to care a damn about the press,” and, of course, is being criticized by the newspaper men.” Hartendorp observed that in the opinion of people with whom he talked, there were too many United States military reviews and parades going on (n.b. Quezon is reviewing troops at Fort McKinley this p.m.).
8 p.m.--Negros left Manila with a large party as guests of Don Andres Soriano headed for Masbate, to inspect his mines there: Masbate Consolidated and IXL. Quezon, Roxas, Sabido, Confesor, Babbitt, Belden, Correa, Dewitt, Spanish Consul, Fairchild, Fernandez (Ramon), Fox, Hodsoll, Ingersoll, Kerk, Le Jeune, Peters, Selph, Whittall, Wolf and many others. Fine ship of 1900 tons and everything aboard de luxe. Bridge with Quezon, Babbitt, Ingersoll, Peters, Wolff etc. at all hours. Conversations with many aboard on mines, sugar, etc. The general impression as to the latter is no basis for the buoyancy and optimism as to the present prices of sugar shares and their future prospects. No one can answer the question: why this optimism? Not only are Filipinos buying up sugar mills, but haciendas also in the sugar districts are changing hands at prices much higher than before. Ramon Fernandez says they have just found that they can produce sugar at four and a half pesos a picul, whereas five and a half has been the cheapest heretofore. But the real reason for the situation is probably that the Filipinos know the sugar game (some have already made fortunes out of it), and they would rather stick to something they do so well than venture into new fields. Many of the gold mines are in an experimental stage still, and the general public is waiting to see what happens.
Duggleby states that up to date, no proof exists that the Paracale district is as rich as the gold vinds in Baguio. However it was formerly the chief seat of Spanish mining. Says that under American rule no new mines have been discovered in the Philippines–yet every creek in the islands has traces of gold. He doubts whether sufficient gold will ever be produced to satisfy the world, since production is not increasing, in spite of very high present price of gold as a commodity.
The general opinion is that very little foreign capital has as yet come into Philippine gold shares.
Talked with Fairchild, Fernandez and Alunan on sugar: the latter sold his own sugar shares in Negros. Babbitt is bewildered by the high prices of sugar shares, including those of his own company.
I asked Quezon if he couldn’t do something to ease off the dismissal of Hartendorp. He replied “we are going to make him a Professor of English.” Quezon was tired out when he came aboard, and the next morning he was as fresh as a daisy, and very gay. I heard him dictating in his cabin–next to mine, at 6:30 a.m.
Just as we were starting for the Stevenson’s party Quezon called me up asking me to explain to Betty how sorry he was he couldn’t come as he was giving a dinner at Malacañan. (It seems he had personally promised her to come.) She would not receive my explanations when we arrived. Had a later chance and told her how Quezon had planned to go to her party with me, and was quite unconscious that this was the evening he was giving a dinner for Romulo. She was still angry and said “Well just let him ask me to dinner!” I asked “You wouldn’t accept?” “I’ll be damned if I would.” There really is considerable disarray in Quezon’s social engagements. An a.d.c. who was not afraid of him could keep him straightened out, but this seems impossible. Certainly there was no mention of his own dinner party on his calendar when I was with him yesterday. Doria tells me she likes Quezon so much personally, but feels he is rude to her about engagements.
Saw Colonel Hodsoll at Stevensons–he was invited to Malacañan and refused because of Stevenson’s party–that will jolt Quezon. The real fault is psychological, Quezon cannot endure to be pinned down–he wants to be free and get away if he feels like it.
Contribution to the Tribune by Pedro Abad Santos commenting on Roy Howard’s article. A very shrewd analysis of the present situation. So far as Quezon is concerned, I do not really know his views of the future –I discard that part of Santos’ article which deals with the working classes, for while now suffering from economic depression, they are certainly on a much higher standard of living than any others in tropical Asia.
Conversation at his office with J. Ross. He supplied the key to the puzzle –everything clicks now and falls into place:
(a) Quezon’s reticence with me
(b) The Roy Howard interview
(c) The good impression wished to be created by the purchase of Manila RR. bonds from the English Company
(d) The unwillingness of Blunt to accept Quezon’s house in Pasay at a very reduced rental
(e) The embarrassment of Blunt over the interview the London Times man (Stevents) had with Quezon etc., etc.
(f) The anxious enquiries Quezon made of me as to the utter dependence of England upon holding her Empire together etc., etc.
This is haute politique indeed. J. Ross told me that Quezon is in favour of independence if that is safe (so is J. Ross!) that at the moment he is badly scared over Japan; that England appears to be an “anchor to windward” (words mine); that three years ago Quezon told him that the United States was going to “kick us out” and Quezon was then in favour of going to London to talk with the Foreign Office; J. Ross told him that the Foreign Office would not talk with him. That Colonel Frank Hodsoll told J. Ross that he (Hodsoll) had been asked by Quezon to talk to the British Ambassador in Washington and had done so.
J. Ross and I agreed on the reasons for the attacks on me here –that I was believed to be in favor of quick independence and that they believed my own Government here had damaged business (Wood-Forbes Report); J. Ross thought it would die down soon. Elizalde’s opposition to me was due to his jealous wish to have a controlling influence over Quezon.
The most surprising symptom I have found here this time is the utter lack of self-confidence among the Filipinos!
J. Ross asked me if I did not think Quezon could lead his people into a Protectorate –I said he could lead some of them, but that denial of independence was a cartload of dynamite.
Doria left at noon en route for the Mt. Data Christmas party of Heine Schradieck of the Standard Oil. Amazingly enough, I remember how I had interned Schradieck together with the other Germans in the Philippines when we entered the World War in 1917.
Saw Secretary of Agriculture Rodriguez, former Governor of the Province of Rizal, concerning the dispute between Binangonan and Cadorno municipalities.
Saw the President at Malacañan at 6 p.m.; he was about to start for the National Assembly which was ready to adjourn. He was in the barber chair now established in the Palace and he received my account of my interview with Blunt with alert interest. His mind was taken up, however, with a pending dispute between the Jesuit Friars and their tenants on some unspecified hacienda. He said he wanted me to help him on it, but what he really desired was a sympathetic audience before which to express his own views. Secretary Yulo was waiting in the next room and joined in the conversation. Quezon said he had sent today for Araneta, the lawyer for the Jesuit Corporation, to prepare the ground before he should see the Administrator of the Corporation tomorrow; that agrarian troubles on this hacienda might result in bloodshed; that he (Quezon) was in favour of justice rather than the law; that these families of tenants had cleared the land and had lived on it for generations –that they practically owned it and had more moral right there than the Friar owners who had not paid originally for the land and had not spent any money on its development. (I interjected the view that as the Friar orders had then been the government they had practically given these lands to themselves, as was customary in Frailandia –that the situation was like a chapter out of Noli Me Tangere –“yes,” Quezon said, “except that now there is no Spanish Governor General to order out the troops.”) Quezon said he told Araneta he would not evict the tenants who had not paid rents and that he would not send the Constabulary to defend the Administrator; that, pending the purchase by the Government of these Friar lands (or alternative measures) he considered the tenants had more moral rights than the Friars –that if these people were dispossessed more “communism” would result; that he did not care to make any public statement of his views, because in this case there might be outbreaks instigated by demagogues.
During the morning, Quezon had signed the National Defense Act in the presence of Osmeña and MacArthur –movie taken of same.
Jim Ross told me he understood “Mike” Elizalde was out as head of the National Development Co.