August 31, 1945, Friday

I have been asked many times how the Japanese financed themselves during their regime.

They came here bringing with them Japanese military notes. It can be assumed for certain that those notes are not backed by reserves. There is nothing behind it except the backing of the Japanese government. As a matter of fact, they are not currency or money. They are in reality requisition slips. Instead of forcing the Filipinos to give them food, equipment and materials, they found this indirect and less painful way of attaining their wishes. At the beginning the circulation of the currency of the Commonwealth was allowed. Following the economic law that bad money drives away good money, the latter soon disappeared in the market. Later, the Japanese made the circulation of the currency of the Commonwealth illegal. Those caught exchanging military notes for Commonwealth notes were taken to Ft. Santiago and punished for committing a hostile act.

The Japanese government then established the Southern Development Bank. They did not use the two Japanese banks, the Yokohama Specie Bank and the Taiwan Bank, except that the Taiwan Bank was used to liquidate the American and other foreign banks. As a matter of fact, the Southern Development Bank was not a bank but acted as a branch here of the Japanese Government Treasury. It was given the sole power of note issue. All the military notes were distributed through it. I had numerous discussions with the Japanese as to the nature of these notes. They have always insisted that they were Southern Development Bank notes, whereas I always maintained that they were Japanese Government notes. I did not feel it proper for the Philippine Government to deal with a private bank.

The Japanese, unlike the Americans, practically made the countries occupied by them defray all the expenses of their Army. They did this by means of the issuance of military notes. I also have no doubt about this as I happened to see the Japanese Government budget. In the statement of income, there was included what was called Contribution of the Southern Islands. (I was not sure what they called it, but I am sure that there were billions — 17 billion as I remember — provided as income from the Southern Islands.) As there was no direct request for funds, necessarily they must come from the proceeds of the military notes. They cannot ask for direct contribution because nobody or very few would give. This was shown when subscriptions were opened for the Philippines to buy and donate an airplane to Japan. Very little was collected and the project was stopped. It would not have been possible to collect a sufficient amount to buy even a small airplane unless force was used, as was done in many cases. As a matter of fact, those military notes were no more, no less than requisition slips. The whole financing of the Japanese, including the expenses of the Army and Navy and what they called war development companies, was exclusively handled by the Southern Development Bank.

This bank made every effort to exercise all the powers of a Central Bank and of a clearinghouse. It insisted that all the other banks deposit their funds with it, especially the reserves of the banks. I opposed this very strongly. I was willing to stake even my life to uphold my view. All the bank managers naturally were afraid to have any sort of issue with the Japanese. I told them that they need not assume any responsibility. I gave them orders not to deposit with the Southern Development Bank without my express authority and order. At that time, there were already on deposit in the Southern Development Bank funds of the different banks amounting to about 1000,000,000 pesos. About three-fourth or four-fifth of the funds belonged to the Philippine National Bank.

It must be stated in this connection that at the beginning I had no supervision over the Philippine National Bank. Supervision was being exercised by Malacañan. The reason was that the P.N.B. was a government corporation and Malacañan was in charge of all national companies. Later, I found out that it was Executive Secretary Pedro Sabido who was handling P.N.B matters. Even after his appointment as Minister of the new Department of Economic Affairs, he attempted to continue exercising the powers; as a matter of fact, after his appointment, he became even more insistent. He contented that the supervision of the Philippine National Bank properly belonged to his department since the bank was a government corporation and his department was in charge of all government corporations. He further contended that the Department of Economic Affairs should control the Philippine National Bank to enable it to realize the purpose for which it was established and also to facilitate the financing of the national companies.

Finally, he contended that, under the law, the Secretary of Finance is already the head of the bank, and it is not proper nor advisable for the Secretary of Finance to be also the Supervisor; otherwise; the Secretary of Finance would be supervising himself. I refused to devote much time and words to the discussion which was academic. So far as I was concerned, the argument I emphasized was that I found it impossible to supervise the banking and financing business unless all the banks were under me. Supervision over the P.N.B. was especially necessary since at least 70% of banking transactions in Manila was handled by the Philippine National Bank. I concluded in a memorandum to Pres. Laurel that if he decided to deny my request, I would strongly recommend that the supervision over all banks be transferred to the Ministry of Economic Affairs. After due consideration, the President told me that he fully agreed with me and he would immediately issue an order accordingly.

Days and weeks passed, the order did not come. I found out that the Minister of Economic Affairs was very insistent. So the President decided to submit it to the Council of State composed of Chief Justice Ramon Avanceña as President, and Don Miguel Unson, Don Pedro Aunario, Don Rafael Corpus, Don Ramon Fernandez and Don Jose Paez. The Council considered the matter very thoroughly and even heard the arguments of Minister Sabido. The President, and this was confirmed later by Don Miguel Unson and Don Rafael Corpus, advised that the Council upon preposition of Don Miguel Unson, decided unanimously in my favor. He assured me that he would issue the order forthwith.

Days passed; weeks passed, no order came. I decided to prepare the order myself and give it personally to the President. It was not signed and issued. I prepared another and left it with the President. After a few days, I asked him about it. He was surprised that I had not received it yet. I prepared another and this time I did not leave Malacañan without the President’s signature.

After the President signed the order, I immediately called Mr. Carmona, President of the P.N.B.. I must first state that under the order, I had all the powers of the Board of Directors of the Bank. I asked him about the deposits. He told me that he had submitted the matter to Malacañan and that no objection had been expressed on the part of Malacañan to the existing arrangement. When I asked for a written authority, he advised that he had not received any and that his experience was that he got no action from Malacañan on matters taken up by him, or at least action was delayed for weeks and even months.

I asked him to explain how he happened to have such a large deposit in the Southern Development Bank. He answered that from the very beginning the military people as well as the Manager of the Southern Development Bank requested him and even ordered him to deposit all excess funds of P.N.B., or funds not needed for ordinary daily transactions, with the Southern Development Bank. Pressure was used so that he had to make some deposit, but he assured me that it was far from what he could have deposited.

The Japanese reorganized the clearing house. Under the new system, all clearing balances were kept by the Southern Development Bank. There was no liquidation and the funds could be withdrawn only when the corresponding bank needed funds. So the deposit of P.N.B. in the Southern Development Bank increased everyday. This was also true as regards the other banks, Bank of the Philippine Islands and Bank of Commerce. They were also being required to make deposits. They said that they had to conform unless they wished their banks closed and their officers accused of a hostile act. I ordered them not to deposit. When they expressed fear, I told them that they should tell the Japanese that, per my order, they had to secure my approval. I also told them to withdraw their balances in the clearing house from the Southern Development Bank.

Mr. Hariguti Takahashi and the Manager of the Southern Development Bank came to me to request me to authorize the deposits. I flatly refused. This is one of many similar incidents I had with the Japanese. One instance was when a large Japanese sugar concern wanted to acquire the Philippine Refining Co., which was owned by the government and practically had the monopoly of sugar refining in the Philippines. An official of the company was told that an unfavorable recommendation from him would be interpreted as a hostile act. I told him to tell the Japanese to talk to me. The Japanese never came to see me. Another instance was when the Japanese Army proposed that the Textile Department of the National Development Company be constituted into a separate company and recapitalized with equal participation of the Philippine and Japanese governments. The participation was later changed to 40% for the Japanese and 60% for the Filipinos. I was made to understand that the plan had already been agreed upon by somebody in Malacañan. I prepared a memorandum strongly opposing the plan. The reason I gave was that the National Development Company, as any other national companies, was formed not for profit but rather to carry out national economic policies. Another time was when Colonel Utsonomiya, later promoted to General, approached me to ask me to allow the importation of opium. I told him that the laws prohibited the importation of opium and penalized its sale. Twice the Colonel approached me. I maintained my position. When it came to protecting our people and their rights, I ignored consequences absolutely.

In connection with the banks, a Japanese officer came to see me. He said that it had been reported to them that in the Ministry of Finance, there was somebody who was anti-Japanese and always worked against them. I knew it was merely a ruse. I answered that I assume responsibility for anything done in the Ministry of Finance.

Mr. Carmona wisely did his best to attain our purpose without unnecessary exposition. Carmona was so capable and prudent that he was able to withdraw a very good portion of the deposit and to maintain the deposit at a very low level.

My views and actions were fully reported to the President and he approved.

I had many other incidents. During a bombing raid, a boat loaded with military notes was blown up and all along Malate and Ermita, it rained notes. They were picked up by the people and spent. The Japanese who had the serial numbers of the notes prohibited the circulation. I protested on the grounds that the notes were already in the hands of innocent persons. For instance, there was Mrs. Mariquita de Ocampo who sold her furniture for 7,000 pesos as she needed the money. Afterwards, nobody would accept her money. What fault had she committed? Finally, the notes were accepted.

The Japanese wanted the administration to be self-supporting. They themselves prepared and imposed the approval of tax laws. From the beginning, my plan was not to change our tax laws; not to burden the people with more taxes than what they had to pay before the war. But how do we finance the government? Of course I had to make it look like I was trying to increase the income by means of assistance of our people. So I did not object to the increase in the income tax law, although I insisted that low incomes not be taxed and larger incomes not be taxed as heavily as in other counties. This is also the reason why I sold an amount of bonds instead from where I proposed to get the money.

Even during the time of the Commission, we borrowed money from the Army, It reached the amount of ₱23,000,000. During the Republic, I secured a credit of over ₱100,000,000 from the Bank of Japan, about ₱50,000,000 of which I got through the Southern Development Bank. When I submitted it to the Cabinet, there was some opposition. I did not argue, but after the meeting I explained to Minister Osias who was the one strongly opposed that my purpose was to charge to the Japanese as much of our expenses as possible. The Japanese Army after the establishment of the Philippine Republic tried to collect our previous indebtedness of ₱23,000,000. I declined on the ground that the Executive Commission was a mere instrumentality of the Japanese Administration. The amount was never paid.

Returning to inflation, I could do nothing as the Japanese did not want to give any power which would enable me to do something. I thought and thought about what to do until I came up with the idea of establishing a Central Bank if I could get the Japanese to approve my conditions. Some of them were: (1) That the Central Bank shall have the sole power of issue of notes. With this I meant to curb the unbridled issue of notes by the Japanese and the unlimited grant of credits to Japanese companies. (2) That the Ministry of Finance shall have jurisdiction and power of supervision over the Japanese banks. I demanded this most important power to control large credits given by the Japanese banks to Japanese companies and nationals. (3) That the Central Bank shall be the depository of the reserves of the other banks. And (4) That the Central Bank shall handle the clearing house balances.

The Japanese were opposed to my plan at the beginning, but in view of the fact that we were a Republic and they therefore could not openly deprive us of the right to exercise powers belonging to all independent states, they changed their tactics. They instead did their best to delay the establishment of the bank. They put up all kinds of objections and suggested many modifications. They wished preferential treatment or at least equal treatment for Japanese banks. I could not of course accept this. Mr. Haraguti, while I was speaking before the National Assembly about the establishment of a Central Bank, sent me a memorandum. I got the impression that he was opposed to it or wanted to delay it. I immediately suspended the proceedings and charged that Mr. Haraguti was out of line. He immediately saw me and tried to explain that such was not his intention. I know English well, I believe, and I had no doubt that my interpretation was correct.

The bill was approved by the Assembly but upon the request of Speaker Aquino a provision was inserted to it so that the establishment of a Central Bank would depend upon the promulgation order by the President. Aquino at the beginning was strongly opposed to the bank; later, he withdrew his objection but was evidently not interested in its establishment. However, the Japanese had not given up. We had no facilities here for the printing of notes and this had to be done in Japan. We prepared the necessary designs. We were told that all the printing presses were busy printing notes for other countries and that they could not begin making delivery until May, I believe of 1945. I went to Japan where I made every effort to expedite it but in vain. I was told that the delivery had to be periodic and the amounts for each period could not be very much. The matter remained in that state until hostilities in the Philippines began.

Another reason why I wanted the Central Bank was that I did not want to have a shortage of notes. We had a terrible crisis about the first months of 1944 because the ships used for transporting the notes were probably sunk or blown. The Japanese banks had no more available notes and the Southern Development Bank had only about ₱10,000,000 in notes of 10, 20 and 50 centavos. The Japanese banks suspended payment, and there was a run in all the banks as the public feared that the banks had no more funds. The Japanese banks, including the Southern Development Bank, wanted to get the notes of the Filipino banks. I refused to authorize the Filipino banks to loan their funds to the Japanese banks. I also instructed the Manager of the Philippine National Bank to withdraw a part of its deposit from the Southern Development Bank. We were all very much worried. Stoppage of payment of banks would paralyze business. All demands for withdrawal in Filipino banks were met. The Philippine National Bank, however, had to offer notes in small denominations. Generally, those wishing to withdraw big amounts desisted as the package of the money would be quite bulky. After a few days, shipment of notes came and the crisis passed. Because of this, I inquired about machines and materials in the Philippines that could be used in case of shortage of notes. We could print here but in limited quantities.

* * * * *

We heard on the radio that Truman had said that the Philippines might have her independence in 4 or 5 months. This means that we may have our independence by next January. I welcome it; I want to have it right now. We would have been spared the loss of billions of pesos and thousands of lives if only people ceased to be mentors of other people.

This means the election will have to be held soon. We may not even be able to take part in the elections. Until we are cleared, we cannot be of much service.

According to the radio, Ambassador Vargas was found in Tokyo and he is a very worried man. He was generally criticized for having been very weak with the Japanese. We were aware of it and we thought him a useless man and an incapable executive. But after we reflected, it may well be that under the circumstances, he did what would be of the greatest benefit to the people. Supposing that instead of getting the confidence of the known murderers, the Japanese, he had fought and defied them. He becomes a hero. But he sacrificed his country for w would have meant direct or almost direct rule by the Japanese. Instead of 200,000 dead, we probably would have had to mourn the loss of millions of our countrymen. Vargas has done much for our country.

January 31, 1942

There is too much wishful thinking. There are too many pseudo-generals. Too many opinions on what the USAFFE will do next and when the next bombs will be dropped.

I have adopted an attitude of resignation. I take what comes. There is no use trying to reform the world. We are mere specks in the vast universe. Our personal wishes are like dust on a wide field.

My mind is in my work. If everybody just sticks to his own work, the world might run better. There is too much minding of the other fellow’s business.

Lim Ki Chao, 704 Uaya, has 50 bales of Hessian cloth for about 75,000 standard rice sacks. Price: ₱32.00 per 100, ex-store. May be sewed in 12 days. Fernando Sy Cip, 85 Valenzuela, has 50,000 empty rice sacks. Price: ₱65.00 per 100, ex-bodega. San Jose Rice Mill, corner Rents, and Juan Luna—no stocks. Sacks are a major problem.

Rice sellers must be placed on salary basis. What salary? That will be determined later. Each stall may engage two helpers each with a wage of ₱1.00 a day.

It was decided that Japanese supervisors will be paid on a salary basis.

It was also decided to place in our hands all cash proceeds from sales in the market.

The NARIC will handle the distribution of flour. Initial supply will be 5,000 bags.

Salaries of the NARIC, CEA and National Trading Corporation, personnel have been approved. The boys will be glad.

Mr. Mori called me to Malacañan. He inquired about the National Development subsidiaries.

Well, it has been another busy day—and month.

January 4, 1942

Warnings have been issued by the Commander of the Japanese Landing Forces.

(1) Anyone who inflicts or attempts to inflict an injury upon Japanese soldiers or individuals shall be shot to death.

(2) If the assailant or attempted assailant cannot be found, we will hold ten influential persons as hostages who live in and about the streets or municipalities where the event happened.

(3) Officials and influential persons shall pass this warning on to your citizens and villages as soon as possible and should prevent these crimes before they happen on your own responsibilities.

(4) The Filipinos should understand our real intentions and should work together with us to maintain public peace and order in the Philippines.

Reign of terror! The law of the gun! People avoid Japanese soldiers in the streets. Everybody is afraid. When you pass a Japanese sentry, you must bow. A man was slapped for not bowing. Others have been tied to posts and made to look at the sun for hours. A man stealing a can of milk from a parked Japanese truck was bayoneted to death. Saw a naked woman bound to a post. She was quite young. There were many onlookers.

Had an important meeting with high ranking Japanese officers at the Army and Navy Club this afternoon. The food situation, particularly rice, was discussed. Present were Col. Masaki, who was apparently the ranking officer; Lt. Col. Yoshida, supply officer; Mr. Mori, manager of the Daido; Yamamoto, manager of the Yokohama Specie Bank; Murasse of the Oracca Candies; Kitajima of the Kinkwa Textile Company; Mitsuda, manager of the Bank of Taiwan and C. Mori, head of the Nang Prostoa. The Filipinos were Gregorio Anonas of the NDC, Jacinto, Villamin, Sabalvaro, Melo and myself.

Discussions mainly centered around the problem of rice distribution. NARIC would distribute rice to dealers in 12 public markets within Greater Manila for sale to the public. Purchasers would be required to first present their residence certificates. The selling price to the public was fixed at P.15 for one-half ganta. The price to rice dealers would be at P6.20 each cavan. Japanese soldiers were to be posted in the 12 markets to insure order. War notes (military money) have been issued by the Imperial Japanese Government. The proclamation of the Commander-in-Chief says that the military notes are backed by the Japanese Government. The death penalty will be imposed on anyone “who attempts to interfere with the circulation of the war notes such as deeds of rejection of payment, forgery or spreading false news regarding the war notes.” I am afraid the printing of this money will cause inflation in the not-too-distant future. The days of “a wheelbarrow of marks for a loaf of bread” may yet come.

Five truckloads of Japanese dead, covered with vegetables, passed by Santa Mesa this afternoon at a little after sunset. There must be stiff fighting in Bataan.

More Japanese troops have arrived in the city. It is their convoy that keeps on arriving.

More people go to churches these days. There are a lot of marriages too.

In a small side-door, ironically near Quiapo Church, many soldiers go in and out. It is a flourishing business.

August 12, 1936

Talk with A. D. Williams over the building activities of Quezon. Malacañan Palace is never quiet; always, there is hammering and moving of walls etc. It appears that while the President is acting Secretary of Public Works and Communications, Under Secretary Cruz has not a jot of authority, and every single decision of his has to be O.K.’s by Presidential Secretary George Vargas. Thus it is very hard to get things moving. Quezon asked Williams about making Vargas Secretary of this Department and putting Anonas in as Presidential Private Secretary. Williams replied to him that Quezon could not spare Vargas as his own Secretary, and it would be better to make Anonas Secretary of the Department of Public Works.

Williams and I talked of the coal mines at Cebu; the iron fields of Surigao; of the possibility of starting a heavy iron and steel industry here; of smelters for the chromium ore, etc. How wonderful it would be if the National Development Company could at last get started–but fear has always been an anaesthetic to them.

June 6, 1936

Arrived at Iligan, route having been changed by Quezon in accord with news from the Manila Weather Bureau. The visit to Culion is now to be at the end of trip.

Before making wharf at Iligan, Quezon addressed the Assemblymen, asking for funds for the development of Mindanao. He used maps, and said that an electric railway was to be built from Misamis, via Bukidnon to Davao, the water power for this project coming from the falls in Lanao. Only four or five of the Assemblymen had ever been in Mindanao before. The gathering seemed to be willing to vote the money, but wanted to know how they were to get the colonists? Quezon replied “Open roads, and they will come of themselves.”

Sabido is opposed to agricultural colonies, when established with government money.

I told Quezon, Osmeña and Roxas that economic plans for the Philippines were blanketed until either they decided, or circumstances decided for them, on their future economic relations with the United States. (I find many here agree with this feature of the difficulty of the sugar situation.)

Quezon talked of Elizalde and the Polo Club incident; he insisted that the refusal to elect Nieto a member had been due to its race discrimination against Filipinos; he added that Saleeby is an Assyrian Jew; that the Assyrians had for centuries allowed the Turks to trample them; that people of that type could not insult the Filipinos.

Osmeña is subdued and triste. He has, I am told, money and family troubles, as well as political.

There is no drinking whatever aboard the ship; the steward complains that he had stocked up, and nobody uses it! Sharp contrast indeed to the last voyage on Negros when Don Andres Soriano was host to the American mining magnates.

Drive from Iligan to Dansalan (Lake Lanao)–surely one of the most beautiful bits of scenery in the Philippines. Through Maranao Botanical Gardens, where there is a waterfall; past the fine fields at Momungan, where in 1914 we established an agricultural colony for “down and out” Americans, of whom there were originally about fifty but now there are only eleven left; all the other colonists today being Filipinos. Then Lake Lanao with mountains in the background which is as fine a scene as any in Switzerland. The buildings, however, have run down since American army days here. The Constabulary who now compose the garrison are splendid picked troops: big, athletic men.

The President’s speech of the day was made at Camp Keithley, where most of the Lanao Moro Datus were present. This made a brilliant scene with their vivid costumes. Quezon, instead of flattering them, as his predecessors had done, talked straight from the shoulder of what his government proposed to do to develop their country; and stated that now they would be required to expect no further consideration as Moros; that they must remember that they were all Filipinos, and that this is their own government. He stated very positively that he wanted no more disorders, adding that: “Life is precious everywhere, but in such beautiful surroundings as Lake Lanao, life is doubly valuable,” and then finally cautioned them that: “thus it would be wise of them to be good”!!

This was new talk for the Moros, and one of them remarked to a friend: “he is hard on us.” All this will do inestimable good. Quezon spoke very carefully, selecting each word. It was badly translated by a native into the bastard Arabic which the Lanao Moros are supposed to use.

Luncheon was served as the post club. It suddenly became dark and began to rain. The meal had been laid for one hundred and twenty, but many more were there, and the food disappeared in ten minutes–as in a visitation of locusts!

After lunch, Wolff and [I went to the house of Lt. Ormai, of the Artillery. He is a small man and a killer.] He said he had two stokes mortars, two mountain guns (3.2) and a sub-machine gun; that the last time he took a cotta (about two months ago) he found their bolt holes, and described how he shelled the Moros there. He said the Lanao Moros are cowards (Cooley says ditto). They oppose everything proposed by the government, but are divided into numbers of petty sultanates. These “Sultans” are selected, if of the blood of the former sultan, for their personal bravery. They get a share of the religious receipts. The older Moros present today had, no doubt, been leaders of the Pirate Empire existing from ancient times which fell after the American occupation; until that, they used to raid the northern islands of the Philippines for slaves and plunder. Their reign is at an end.

Visit to Reina Cristina falls; a magnificent site, and the best hydro-electric proposition in the Philippines. This will certainly suffice to run an electric railway. Quezon has ordered the Bureau of Public Works to give no more franchises for water power in the Philippines; all are to be reserved for the government.

Camp Overton, near Iligan has been entirely abandoned. I first came there with General Pershing in December 1913.

Left Iligan for Zamboanga. At dinner with Quezon, Santos, Roxas and Sabido. Roxas and I pressed hard for reforestation and a campaign against forest destruction for clearings (caigñins). Quezon heartily agreed with our arguments. Someone remarked that Cebu had been so ruined by destruction of its forests, that in a century from now it would have hardly any population. I mentioned what the Government of Japan was doing for reforestation; how Germany, France, Switzerland managed it by communes. Quezon said he was confident he could make the people understand why they should not burn the forests for homesteads (caigñins).

The President added that this was the first visit to Lanao he had ever enjoyed, because he didn’t have to listen to Datu Amanabilang; that the last time this old Moro had spoken in his presence he had argued that they did not want to be governed by Filipinos but wanted the Americans there; but today a Datu had protested against the American Superintendent of Schools, and wanted a Filipino. He, (Quezon), thereupon “went for him”; and told him his threat of closing the schools by withholding children would not be listened to by the government; that if the schools here were closed, the money would go elsewhere, where people were clamoring for schools. Quezon further admonished this man that the Datus were no better before the law than the poor man–that even he as Chief Executive was not above the laws. That the Moros, though in a minority, had equal rights with the Christian Filipinos; that if the Moros developed a great leader, as he hoped they would, this man would be available for election as President. Quezon also denounced their petition for Moro Governors of provinces and Presidentes of villages, and said the best citizens would be selected where he was a Moro or a Cristiano.

Later, the President told me he now thinks the Lanao Moros will gradually “come into camp,” when they see that the government is in earnest; that they are good farmers, and he was going to build a fine road right around Lake Lanao, to help to civilize them, “instead of killing”; and if they won’t be “good” they will eventually meet the same fate that the American Indians did.

The President was rather sharp with his a.d.c., Major Natividad, for trying to get him to read a paper at dinner, when he wanted to talk.

In the absence of the Governor, Quezon called up the Colonel commanding the Constabulary here, and ordered him to remove the squatters from around the reservation at Reina Cristina falls. He also told Roxas that he would wire the President of the United States asking that the remaining Army reservations near Camp Keithley be turned over to the Commonwealth Government, so that henceforth settlers on these lands would not be evicted.

I had a talk with Assemblyman Luna of Mindoro about his bill to protect tamaraos, a unique small buffalo, found on his island and nowhere else today. He told me that the game reserve I had created by Executive Order on Mt. Calavite, Mindoro, was of no use because no game wardens had been appointed. He said the peculiarly malignant malaria found on this island had been eliminated at least from around San Jose. He added that he himself, has never been in the interior of the island, and it is almost uninhabited. Naturally, he wants this great province, just opposite Batangas, developed. I told him I thought the malaria in the past had practically ruined the island, since there had been a large population there in ancient times, to judge from old Chinese records.

A geologist named Belts, a great traveler and good observer, said a special brand of English was being developed here in the Philippines. The teachers had a bad accent and the pupils worse. (This is why I now find it more difficult to understand my servants,–and indeed all Filipinos, especially over the telephone.)

Talk with General Paulino Santos, the head of the Philippine Army, who is my cabin mate. More than twenty years ago I appointed him to be the first Filipino Governor of Lanao, and now he comes back as Chief of Staff, naturally, very proud he is of his rise in life. He is very conscientious and is fiery tempered about his work; he has no patience with political or personal promotion seekers. He is quick on the trigger about resigning if he meets a serious obstacle in administration–as he did with General Wood. He finds General MacArthur to be the cleverest American he has met, and very broad-minded. Santos intends to have all supplies for the new army made if possible in the Philippines. He will tolerate no interference with his official authority, and recently “sat on” General Valdes and Major Ord, MacArthur’s assistant. He does not get on well with Osmeña, but has a fine relationship with Quezon, who he says, was very cold with him at first. Santos is utterly and completely devoted to the service of his country,–and is not afraid of anyone nor of any nation. He remarked: “I honestly believe that next after the Japanese, the Filipinos are the greatest of the Asiatic peoples.”

Comments I have heard upon the Lanao Moros by my companions are: vacant expression, open boob mouth, stained with betel nut–(Malay type). These Moros do not bathe, and one is glad to avoid shaking hands with them. Their poor physical appearance is variously ascribed to inbreeding, hook-worm, and opium.

A passenger on the Negros who is a much-traveled geologist said that in the Dutch East Indies the third generation of Mohammedan Malay were quite tractable, and he thought these Moros would develop in the same way.

Talk for one hour with Vice-President Osmeña:–recollections of old times when he was the undisputed leader of his people, and we had worked so closely together. I asked him about Palma’s report on education; he said he hoped it could be put into effect but was not sure. I next asked him about the high price of sugar shares in the Philippines. He thought the market level far too high, but said the sugar people had so much money they put it into more shares and high-priced haciendas. Next I recalled how with backing he had founded the National Development Company, eighteen years ago and it had accomplished nothing. Asked if all economic plans were not paralyzed by the sugar question, and he agreed.

Then I enquired about the reforestation of Cebu and he expressed himself as enthusiastic over the idea but at once diverted the conversation into a eulogy of planting fruit trees, and increasing the export of fruits. Said it was almost impossible to induce the Chinese to eat more sugar but in fruit: “can do.” He eloquently pictured millions of Chinese eating Philippine bananas which he thinks far superior to those from Formosa. I called attention to the recent exclusion of mangoes from importation into the United States on the old dodge of thus preventing the introduction of the “fruit fly”! (Recalled my speech in Congress on this subject, and the cynical smile of Speaker Cannon.)

I asked Osmeña about the future of their free trade market in the United States. He agrees with me this cannot be held. (So does Tommy Wolff, who comments: “none so blind as those who will not see.”)

Next I asked Osmeña about Nationalism in the Philippines. He said it was growing greatly, but that “it is wise to preserve some local sentiment or culture.”

Osmeña commented on the political strength of agricultural organizations in the United States, and said Secretary of State Hull told him: “These people are very powerful.” I asked him why United States spokesmen are now “delivering so many kicks against the Philippines.” He replied: “because of (a) the economic situation in America and (b) they have lost interest in the Philippines; the old generation, many of whom had altruistic feelings towards Filipinos, are gone.”

He agreed that the period before complete independence would be shortened by the United States if the Filipinos asked for it.

Osmeña then expressed feelings against the taking of teachers camp in Baguio for the army; said the teachers made the best soldiers anyway since they were so conscientious, and had such a sense of responsibility towards their country.

I reminded him of how we carried through the plan for civil government in Mindanao and Sulu in 1914, to which the War Department agreed because Pershing joined in the recommendation; Pershing’s motive being support for his own record–he wanted to rank as the last Military Governor of the Moroland and to show that his administration had pacified those regions in order that the army could be withdrawn etc. Osmeña then told a story of Pershing on a visit with him to Cotobato just before I came to the Philippines in 1913, when the proposal to establish a colony of Cristianos there was under investigation. Osmeña added that Bryant (?) was taking photographs of Pershing, explaining that he wanted a record of the one who would be “respondible” for the project, and Pershing at once said he would have the plates broken. Quezon said they have by now spent a million pesos on this plan, but agrees that it was worth it, since, right where there is the largest Moro population, the purpose has been accomplished in Cotobato of “settling the Moro question.”

Osmeña also talked of the Japanese: thought them very clever, and thoroughly disciplined. He expressed surprise that though the Japanese did not talk good English [while] their government statements in the English language were always so perfectly expressed. (I think former Consul General Kurusu is this “foreign office spokesman.”)

Short speech by Quezon to the Assemblymen as we approached Zamboanga. He believes that the town is ended (commercially) because of its geographical position. He asked the respective committeemen to visit the schools and leprosarium; but the great object of interest is of course, San Ramon prison colony (founded by Don Ramon Blanco in 1870 for political prisoners, and developed by us into an agricultural and industrial penal colony). He stated that the time had now come for the Assembly to decide (a) whether to sell this hacienda to private parties, or (b) to sell part of it and keep part (piggery) or (c) to keep it as training school for the Davao penal settlement. There are 1300 hectares at San Ramon, and 27,000 at Davao.

Tommy Wolff told us how, during one of his earlier political campaigns Quezon had been savagely attacked as a mestizo–especially in the provinces of Tarlac or Zambales. Quezon at once went to a meeting there and stated in his speech that his mother was a Filipina, he was born in the Philippines, and that he is a Filipino–he “didn’t know what mestizo meant.”

In Zamboanga, Osmeña made the address at the Plaza Pershing. It was said to have been extremely eloquent. He spoke con amore of the development of the former “Moro Province” and made polite allusions to my work there. The President and I played truant and went out to San Ramon with Speth and swam on the beach there. All the rest of the party joined us there at tea-time. Quezon persuaded me to eat for the first time balut, i.e., eggs containing chickens about to hatch! It is really quite a delicacy. The President at once noticed the prettiest girl there and danced with her; there was a lot of amusing chaff over his writing in her autograph book. Quezon then told us a lipstick story of a Hollywood girl he once met on the steamer crossing the Pacific:–he was giving her a cocktail and remarked: “I wonder why girls use that hateful lipstick?” She instantly replied: “Don’t be afraid, I’m not coming near you.” (But she did.)

Talk of the bad English accent of the young Filipinos of today; Quezon said he was going to try to have English instruction eliminated from the primary grades, and get Americans to teach in higher grades. I asked: why not get teachers who really speak English–namely, the English themselves?

Then had a talk with Quezon about Secretary of War Newton Baker. Listening to my account of my own slightly strained relations with him, he said “I thought the atmosphere of the army in the War Department was affecting him.”

Quezon told me of High Commissioner’s insistent dwelling on the necessity of balancing the budget. Quezon had heard that Murphy stated the Philippine Army was unbalancing the budget, “and that was one of the reasons I accompanied him on the boat as far as Hong Kong but we never had a chance to discuss it.” When Quezon returned to Manila, he sent for Weldon Jones to talk this over, and said to him: “before we begin to talk, let’s agree on the term ‘balanced Budget.'” This was then defined as: “the ordinary expenses of the Government falling within the ordinary revenues.” Agreed. Then he told Jones that the recent income of the Philippine Government was not “ordinary,” because “we have had a row of Governors General here who didn’t collect the taxes.” He added that he would collect five million pesos a year more than his predecessors had done from the present taxes, and “in the first quarter of this year I have already collected two millions more than were received last year; moreover, I am going to impose new taxes: an inheritance tax (where there are no children) to confiscate all estates over a half million pesos, and heavy income taxes on all those having over 100,000 pesos income which is “enough money for any human being.” Weldon Jones expressed himself as delighted with this form of taxation, and, added Quezon “Murphy himself would be delighted but had not the nerve to risk public disapproval here; he will be glad to be absent while this is done”!

I commented to the President on his advantage with the legislature in being a Filipino himself, and, unlike his predecessors, he was thus able to deal directly with them, and not thru an intermediary. He replied: “I know the (sotto voce) Goddamn psychology well enough.”

Quezon asked Colonel Stevens commander of the local Constabulary (Army) at Zamboanga whether he would like to be transferred to Manila. Stevens, who was driving the motor said slowly: “Well, Mr. President, I would really rather stay in Zamboanga.” Quezon replied: “Well, next year you will have to come to Manila anyway for six months,–you can’t get to be a General without doing that. I will attach you to Malacañan and then you can get a per diem.” Stevens said “Very good, Sir.” He has about the nicest house in Zamboanga. We went there to play bridge later. Quezon explained to Stevens that he wanted the Non-Christians to “get accustomed” to Filipino officers and had moved Dosser from the Mountain Province, and Fort from Lanao accordingly.

Interesting talk with Quezon over my landlord and tenant propositions. He told me of the bill introduced to lay progressive taxes on large landed estates, as I had recommended in January. He said that Assemblymen had been in touch with him on this; that the savage attack in the Bulletin against this bill convinced him of its merit, if before that he had had any doubt that the idea was sound. I then talked about the Irish Land Laws with him, and asked him if Roxas would oppose, after lamenting in his University of the Philippines commencement speech that “the land in the Philippines was passing from the peasantry to large land-owners.” Quezon said “Yes, he will object, on account of his wife (a De Leon from Bulacan) but we shall beat him.” Told him I wanted to consult with members of the Labour Committee now on board about the bill, and he said “Yes–you’d better.”

After dinner I stayed on board writing up these notes, while all the rest went to the dance at the Zamboanga Club and returned at 11 p.m. in high spirits, but with no signs of alcohol.

Bridge with Quezon, Roxas and Sabido, from 11:30 to 4 a.m. Then sat talking with Quezon and Sabido until 5. For the first time, with Quezon, I raised the Japanese question. He said his first preference would be for the Philippines to stick to the United States, if possible; if not, to England. If those alternatives are not available, he would come to an arrangement with the Japanese, and “I can do it–I know how.” Sabido said that the Japanese individuals who he knows are all afraid of Quezon–that the President was the only man who could handle that question. Quezon said that a few years ago, in Shanghai, he brought Chinese and Japanese leaders together, and the success of those negotiations was temporarily such that the Japanese people at home were for a time annoyed with their army for treating the Chinese so harshly. Like every one else, Quezon has grown tired of trying to help the Chinese “nation,” but now says it would be the best thing for China to recreate her country with the aid of the Japanese. “The Japanese despise the Chinese” he said “but admire the Filipinos for setting up their own nation.” He then told some of the recent history of North Asia with a sympathetic understanding of Japanese problems; described how, at first, all they wanted in Manchuria was to protect the interests of their railroad there. The Chinese had agreed to Japan’s building this railroad, thinking it would be a dead loss but when, instead, it became profitable, “They threw stones at the Japanese.” He recounted the extreme aggressions of the Chinese which had harassed the Japanese so sorely–how the Chinese propaganda had brought the European powers to her side as had also the missionary propaganda in the United States. He added that the successful war of Japan against Russia had been brought by them as a purely defensive campaign, if ever there was one.”

Quezon believes in the good-will of Japan towards the new Filipino nation. He remarked: “I have acquaintance with a large number of Japanese, but have hardly ever been able to make friends of them”–an exception is Marquis Tokugawa–the grandson of the Shogun. Another friend is the present Japanese Consul General in Manila, who replaced an arrogant and trying man, and is more like Kurusu. The President said he is getting constantly closer to the Japanese Consul at Manila; that the latter is now learning to trust him, and actually gave him more information about the strained Davao situation than “any of my own fellows”–“I telephoned him recently and told him that the question which caused real irritation against Japan among the Filipinos was not Davao, a question the people at large really do not understand, but that of their invasion of our fisheries, a matter the Filipinos do understand, since it affects their own food supply.” The Consul replied that he saw the point clearly, and would ask his government to draw off the invading fishermen. President Quezon admitted that the reported “incident” on his recent visit to Davao was true: namely, that the Japanese Consul had suggested that there might be “grave consequences” in the outcome, and Quezon had replied: “You can’t bluff me.” We then talked of our old friend Ambassador Hanihara of long ago in our congressional days in Washington–Quezon said the incident which caused his recall as Ambassador, was very unjust: “Hanni,” (as we used to call him), showed the “offending” letter to Secretary of State Hughes before he sent it and Hughes said “fine”:–then, the fierce public reaction in the United States frightened Hughes, and Ambassador Hanihara was recalled by the Japanese Government and Hughes permitted this injustice in silence.

I asked Quezon what he proposed doing to stop the Moros from smuggling in Chinese coolies and opium? (A matter apparently entirely neglected nowadays) and inquired why he didn’t get a fast gunboat. He replied that in a couple of months he would have five of Mussolini’s fast “torpedo type” boats capable of going fifty miles an hour.

To bed at 5 a.m. after a more interesting day and night.

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 14, 1936

Short chat at Malacañan with Francisco Benitez, in which I expressed pleasure in the new plans for education. I asked him about building school houses–he said that in future they were going to stop building, in expensive and ugly concrete, and construct in “native materials.” After all these years of folly, I am glad to see common sense at last prevail.

Long talk with Dr. Manuel Roxas about the Council of National Research and the importance of research work in general to promote diversification of the products of the country. We seemed to agree about the deplorable paralysis in all economic plans, due principally to the influence of sugar interests and their lobby in Washington. Nevertheless, he wishes to speed up research work to be ready for the time when the National Development Co. does get to work (if ever).

In p.m., went with A. D. Williams, Consulting Engineer of the Metropolitan Water System to inspect their plant. Lovely drive to Ipo–on a road new to me. Otley Beyer, who came along with us, pointed out many of his best archaeological sites in Rizal and Bulacan, where he made the first discoveries in 1926. He was very interesting about the neolithic and Iron Age people. The latter era in the Philippines was from 200 B.C.–700 A.D. He also showed us the streaks of red earth where the “tektites” are found, which he named “Rizalites.” These are, he said, the only meteoric stones of a silicate nature, and also the only ones which contain mineral elements not yet known on this earth. The valley of the Novaliches River is rich in ancient remains–a region now largely unoccupied by man. Beyer says this is probably due to two reasons: (a) malaria (still there) and (b) gold digging and panning by the ancients, which then petered out, so far as their methods went. The earth here is honeycombed with old worm-like tunnels, with ventilation holes every 30 feet. Beyer says this was the mining method of the Chinese who flocked to California, after the ’48, and began working over the sites abandoned by Americans. We saw the spot where gold signs were discovered when the Bureau of Public Works constructed the road to Ipo–which led to the Ipo and Salacot mining industries today.

Old women still pan about 50 centavoes a day worth of gold out of the Santa Maria River near there–just as their ancestors did 2000 years ago.

At Ipo, we saw the coffer-dam being constructed on the Angat River which is to be completed in 1938, thus making a deep and narrow lake ten kilometers back into mountains. The river varies fifty feet in height between lowest and highest levels, and is always swift. The six kilometer tunnel, which took six years to complete, gives a six foot (in diameter) opening down towards the filter plant near Novaliches. When finished, this project will ensure Manila for the next century at least a fine water supply. Visited the new reservoir at Novaliches, and also the recently opened filter plant a few miles below there. All very wonderful engineering.

April 7, 1936

At sea nearing Jolo. At breakfast I had a talk with Quezon over the Government Survey Board. He said the government had become a mere bureaucracy; I told him the Survey Board was puzzled to know how to decrease the expenses of government in accord with his wishes–was it by lowering salaries? He said no–but by abolishing useless places and duplications.

The President then told me how, long ago, he had agreed with Governor General Wood to sign the contract for the sale of the government’s Portland Cement Co. in Cebu for 200,000 pesos; though he never intended to do so, but wanted Wood to keep quiet during his (Quezon’s) current political campaign then under way. The day after the election, Wood sent for him and presented him with the contract which he (Wood) had already signed, and then Quezon refused. Wood went purple in the face and rose as if to strike him. Quezon told him he had changed his mind, and that he took that privilege because Governor General Wood did it so often himself! The government cement co. now has a surplus of two million pesos, and is worth about four! Wood wanted to give the Manila Railroad away to J. G. White and Co.; also to sell all the government-controlled sugar centrals for a song. Quezon says Wood would have lost one hundred million pesos for the Philippines in his rage to “get the government out of business.” (I was the one who had originally put them in!)

Quezon is going later to Davao with three members of his cabinet: Rodriguez, Yulo and Quirino, to settle the ticklish international situation there; wish I could be there, but am going back to Manila.

Arrival at Jolo. Visits to provincial and municipal buildings. Quezon made a fine speech to the Constabulary at their quarters. He told them that the primary duty of soldiers was to ensure peace and order for their fellow men, and this should be sufficient reward for them. He said that the duty of the soldier in time of peace was to be courteous and just, but in time of war it was to kill; their rifles were not given to them as ornaments, but to kill when ordered to do so. Since several of the leading Moros were present, this firm attitude will be understood all over Jolo in forty-eight hours. The Constabulary can handle the situation of allowed to do so, and now they have been assured of the proper backing by the highest authority. The Moros are bullies, and understand only force.

Quezon told me he was going to break the power of the Datus (there are 6 or 7 of them in Jolo) and to stop the “babying” of them by the Government.

He received telegraphic news that the registration for the new Philippine Army had been 100% successful, and very happy he was over this–showing again how much better he understands his own people than do so many of the Filipinos.

A terrific rainstorm arose which prevented our trip across the island of Jolo by motor.

[Mrs. Rogers, the Moro wife of the former Governor of Jolo (and an old sweetheart of Quezon)] came to lunch. I asked her, before the President, how long it had been since the last disorder occurred here? She replied that order had been more disturbed during the past three years than for a long time past. She told the story of the killing last night of a boy of twelve who ran away from a provincial policeman–i.e., one of the “police” attached to the Deputy Governor, the Datu of Indanan. Quezon rose at once–sent for the municipal President, the Chief of Constabulary (Major Gallardo) and Governor James Fugate. I advised Quezon to abolish the “deputy governors” and their gangsters. I also advised him never to make a Moro the Governor of Jolo–he said he never intended to do so, but would appoint a Christian Filipino (Major Gallardo) as Governor in the place of Fugate, who was originally a “missionary” and “should have remained so.”

Quezon, when he had inspected the jail, reported that there was one young man in there who claimed to have killed his man in a fight. Quezon said he did not always object to that sort of killing, and would look into the case. He said there were also two Moro women in jail on the charge of adultery; he told Judge Labrador to try the two cases this morning, and if convicted, he would pardon the women, “since it is absurd to allow a man to have thirty wives and to put a woman in jail for adultery.”

Graft and tyranny are rampant among the Joloanos, and Quezon is glad he came down here to learn the situation.

Opium smuggling, which used to be rife here, is uncommon now, and this must mean that the British Government at Sandakan is at last helping to stop it. I couldn’t get them to do so in my day and this was the subject of an acrimonious exchange of views between myself and Lord Curzon when he was British Foreign Secretary. [Met Hadji Butu, former Prime Minister of the Sultan here, whom I made Senator, and later discharged as such for taking part in the opium traffic. I asked Mrs. Rogers what he lives on now–she replied: “graft–mostly religious.”]

Quezon is a most erratic bridge player–always doubling and bidding slams. He plays his hands wonderfully, and if he makes an original bid, it is sure to be very sound. I am losing heavily here, as I did on the Negros trip.

The President has apparently been completely cured of his stomach ulcer by a series of injections–he now eats copiously, and even drinks beer and cocktails. I must go to see his doctor as soon as I can get back to Manila.

The contrast here between the neat homes of the Christian Filipinos and the reeking quarters of Chinese and Moros is striking.

Mrs. Rogers told me that none of the teak forests of Jolo, the only ones in the Philippines–are being cut and sold. Main exports are copra and hemp. They grow some upland rice, but the Moro diet consists chiefly of tapioca and fish. They are marvellous sailors.

Quezon gave me to read “The Secret War for Oil” after I had gone through it I told him he ought to go down on his knees and thank God that oil had not been discovered in paying quantities in the Philippines. He said he had been first told that twenty years ago by Representative William Atkinson Jones of Virginia. If oil is found here, it should be in the hands of one company only–either American or English, and not divided up between various rival oil companies.

In the afternoon, trip around the island of Jolo on the new roads, and saw the sites of various battles fought by Generals Wood and Pershing. We visited all the Constabulary posts. I had been to Camp Romandier in 1915 when we had that thrilling deer hunt with spears, and on horseback. The agricultural development of the island is now simply wonderful–they are, perhaps, the best farmers in the Philippines; also they have fine stock; horses, cattle and carabaos. I told Quezon that this had changed my whole opinion of the Jolo Moros. It is an eye-opener; and he said it had had the same effect on him. That he was going to bring some money here, and help break the power of those who are exploiting the poor farmers of this paradise on earth–whether they are Vinta Moros, Chinos or the Datus. If necessary, he would have the National Development Company undertake the marketing of the crops, so as to cut out the extortioners. He repeated what Governor Fugate had told him: there are three kinds of Moros–the aristocrats, the farmers and the Vinta Moros, who own no land and live at sea.

The President is now receiving on the Arayat a delegation of the Datus who are not officially favoured by Governor Fugate. “Probably they are full of complaints.”

Quezon says he will provide appropriations for more water for Jolo. He is very enthusiastic over what he has seen. I told him he must be prepared for explosions if he broke the power of the exploiters–resistance on some feigned issue–he said he was prepared to handle that.

Altogether, I think this afternoon will have an important bearing on a fair settlement of the “Moro problem,” at least so far as Jolo is concerned.

The teak forests are very badly managed–but crops of hemp, maize, tapioca, coconuts and upland rice are excellently farmed; so are papayas, mangoes, kapok and other useful trees.

The President received a telegram stating that the Japanese had landed on Turtle Island, taken all the eggs and the female turtles and killed all the males–an incident full of disagreeable possibilities.

We received a statement in the town of Jolo from a local resident (Mrs. De Leon) that the magnificent farms we saw were the work of Scout and Constabulary soldiers who had settled there–the more backward farms were the work of the stay-at-home Moros.

Arrived in Siasi at 11 p.m.; a small crowd of local officials had gathered on the pier. Quezon is the first chief executive, I believe, to visit this island except General Wood. We stumbled about in the moonlight, visiting the old Spanish fort and the barracks built by the American soldiers in 1901. The main street was faintly lighted by electric light owned by a Chinese–there are one hundred Chinese here in a total population on the island of only some four thousand–one road has been built, four kilometers long, half way across the island. The racial stock here is Samal (the sea gypsies–there are three types of them, those who live entirely on their vintas with no house on land, those who live entirely on land and those who use both). Industries are pearls and copra. Evidently the Chinese get all the profits.

Quezon asked the locals whether they had any questions or complaints–one leader stepped up and advocated the retention of Governor Fugate (Siasi is a part of the province of Jolo). Quezon asked him: “are you the agent of the Governor?” and he replied “Yes, Sir,” and probably didn’t find out until the next morning the irony of it.

On our return to the steamer, Quezon talked for an hour with Peters, Wolff and myself. I lamented that the courts had overthrown our attempt to force by law the keeping of books by the Chinese businessmen in either English, Spanish or a native dialect of the Philippines. Quezon said the adverse decision in the Philippine Supreme Court, had been written by Justice Johnson, and that in the United States Supreme Court by Chief Justice Taft–but it was purely a political decision. Said that the new constitution of the Commonwealth had provided for that; that the rice marketing of the Philippines was entirely in Chinese hands, and they could, if they wished, starve the islands–“an intolerable situation,” he added.

Talking of the necessity of the Constabulary being supported by the head of the state, Quezon described the recent Sakdalista uprising in Laguna Province. The local chief of Constabulary received some rumours of a gathering and sent a patrol of one officer and ten men in the jitney to make a survey. Approaching Cabuyao (near Biñan) they found the town in the possession of a large party of Sakdalistas who had seized the Presidencia, on nearing which they were fired on and the officer and five men were wounded. The officer leapt from the jitney and cried out “come on and fight them, men”–they began firing and killed fifty of the Sakdalistas, after which the rest fled; but instead of commendation, the Constabulary were given repeated investigations! (Quezon was in Washington at the time.)

The President then passed to the subject of communism, and said that the Filipinos were easily drawn to these theories. Governor General Murphy he felt made a mistake when he released the communists from Bilibid prison–even though he was himself opposed to keeping men in prison for their political opinions. He made it as a condition to their release that they be exiled from Manila to various points such as Ifugao and Batangas. When Quezon assumed the presidency of the Commonwealth, he found that the people of the localities to which those men had been deported had built them houses and were supporting them! In Spanish days, all the Filipino patriots had been similarly deported! Quezon pardoned these exiles from home immediately in order to destroy their influence in politics. He then had an interview with [Evangelista, one of them who is an educated man and is a convinced believer in communism, and had been one of Quezon’s former leaders.] The President told Evangelista that it was folly to think the Philippines could be converted to communism. Evangelista replied that the communist leaders were building for the future; they were working for their grandchildren and were willing to die for their belief. Quezon retorted: “it’s no more use talking to you–you look out you don’t get into the clutches of the law again. There is one difference between you and me–you are willing to die for it and I am willing to kill you for it.”

Then we talked about health. Quezon said he thought my trouble was nervous indigestion and that I could be cured by having some work to do which really interested me: that as soon as I was through with the Government Survey Board he wanted me to work with him on a history of the Philippines during the fifteen years since my administration. The accepted belief in the United States, he said, was that I had wrecked the Philippines and Wood had restored it; while the exact contrary was the truth. We would get the figures, and he would give me the incidents from his own recollections. Told me how he was flat on his back in Baguio a few years ago when Osmeña opened his attack on him in connection with his opposition to the Hare-Hawes-Cutting law, saying Quezon should be driven from the Philippines. Quezon was at once carried from his bed to the train, and at Tondo station was carried from the train to a platform which had been erected there for him. Thousands of his followers were present. He spoke for an hour, and walked down from the platform and was ill in bed no more.

March 24, 1936

At the office. Miguel Unson, to whom I reported that Quezon told me he had instructed him (Unson) that I was to sit with the Government Survey Board replied: “It must be so because he said so, but I never heard it.” Said he would try again to see Quezon tomorrow.

Usual crowd of office seekers and Others needing help, in my office.

Visit from Hartendorp, Dutch-born American citizen; editor of the Philippine Magazine, who has just received from Vargas his dismissal as Adviser on Press matters. Says Quezon had sent for him before inauguration and had asked him to be Press Adviser at a salary of five hundred pesos monthly. He was flattered and pleased. He has a Filipina wife and children and was proud to be called in by the President. He asked Quezon from whom ho should take orders, and the President replied: “only from me”; thereupon Quezon called in his a.d.c. and gave instructions for the immediate admission of Hartendorp whenever the latter wished. However, Hartendorp soon found that he could not obtain “audience.” He thinks Vargas has “gypped” him, because he had criticized him severely in his magazine.

Hartendorp had rented a house in Uli-Uli, had taken his children out of boarding school, and was about to celebrate his reunion with them in a home when he received his dismissal. When first appointed, he had asked Quezon how long the work was to continue, and Quezon replied “two or three years–or as long as my administration lasts.” Hartendorp lasted three months!!

Talk with A. D. Williams, who suggested buying for the National Development Co. a yacht like Yolanda of 1000 tons for Quezon’s use. Thoroughly good idea!

Williams has just been made a director of the Cebu-Portland Cement Co. which had inherited the Cebu coal field, once the property of our defunct National Coal Co. He says they have just found 350,000 tons of excellent coal there which will lower the cost of cement. (Even our Coal Company was not without some merit!)

Elizalde presided over his last meeting of the National Development Co. this morning. Usual glowing accounts of his management given in Herald which he owns. It seems he thinks the Elizaldes have lost “face” since his resignation as President of the National Development Co. was accepted, so during this week while the President was away the Elizaldes forced an issue in the Polo Club by proposing and seconding Manuel Nieto for membership. (The Polo Club and the Army and Navy Club are the last stand of the “Old Tinier” Americans.) [Nieto was rejected on the ground that he was only Quezon’s “gun-man” (which is very unjust!).] All four Elizaldes thereupon resigned from the club and took their polo team to the practice field in Camp Claudio. They are now seeking to lead the army polo players away from the Polo Club–but in vain.

The late General Tinio’s son (nephew of Don Isauro Gabaldon) came in to see me with the request that he be appointed technical assistant to me. It seems that Assemblyman Angara of Tayabas had asked his uncle (Quezon) to make this appointment without consulting me, and Vargas had told him in reply that if “Governor Harrison had need of a technical assistant, it might become possible later on”!!!!