February 23, 1942

Proud of our boys in Bataan. They are still holding the line. KGEI reports “heavy exchange of artillery in the Bataan peninsula.” We’re doing better than Singapore. Filipinos are good soldiers.

Messrs. Noya, Kobatake and Evangelista returned from Bulacan. They report confusion and misunderstanding in purchase arrangements between Major Kurumatani and Supervisor Noya.

Posadas reported inability to handle tremendous amount of detail work in connection with the handling of confiscated rice.

Bank meeting this morning. Didn’t agree with the Board. Binalbagan has a credit line of ₱1,000,000 which was being increased to ₱1,500,000 favorably. On the other hand, Nasugbu and Roxas firms were requesting a credit line of ₱100,000 each for 160,000 piculs of sugar and this was denied. It was my opinion that under the circumstances, Binalbagan’s request should have also been denied. Carmona argued that Binalbagan belonged to the bank. I said that that should give greater weight to my contention. Then Chairman Vargas revealed that ₱350,000 of the requested increase had already been given. This was given without the Board’s knowledge nor consent and I called the Board’s attention to this. Chairman Vargas demanded a categorical answer: “Do you approve—Yes or no?” I remained silent. The credit line was passed.

After the meeting. Vargas called me. In the presence of President Carmona, Vargas apologized, giving as excuse his state of high nervous tension.

Later in the morning, as I had no time to go to the bank, I told Carmona over the telephone that under the circumstances, I did not want any longer to be a board member and I leave it to him to present my resignation as bank director at the opportune time. Carmona asked me not to resign. “Just forget the matter, Vic,” he said.

Those present in the board meeting were Carmona, Sison, Rodriguez, Gomez, Avanceña and Vargas.

I submitted my resignation, verbally anyway. A man must stick to his principles.

February 1, 1942

This is going to be a long war. Only an ostrich can think it will be short. This is a death-struggle between mighty nations involving millions of lives. Japan is staking everything. If she wins, she can mould the East, and perhaps the world, according to her dreams. If she is vanquished, she will be humbled to the category of a fourth-rate power, the disastrous culmination of 3,000 glorious years of legend and history. But whether Japan is victorious or defeated, one fact is clear amid the maze of historical cross-purposes: the emergence of Asia. The invincibility of the White Man has been shaken. Shadows have been cast on claims of Western altruism. India, for example, shall always stand as an issue of freedom. China, united by a common foe, shall rise greater from her wounds. And the spread of Russian influence over a reawakened Asia cannot be underestimated. The world may yet see a war of races. In our shores today, we see the tiny ripples. Someday it will swell into a devastating tidal wave.

Worried about the rice harvest. Issue strict orders for the paralyzation of transportation. Control must be enforced because of high prices; otherwise, abnormal prices will continue.

A ceiling price will be placed on all commodities, except palay and rice. NARIC will regulate it.

Only the NARIC will be allowed to transport palay and rice, it is planned.

Must study administration of mills.

NARIC will not handle the entire rice industry. Private transactions will be permitted, but it will be regulated.

Controlled economy will be enforced. The critical state of the national economy does not permit the free play of supply and demand. The masses will be at the mercy of unscrupulous hoarders. Equitable distribution can only be attained at present by controlled economy.

NARIC may distribute sugar. It will be the single selling agency. This means more work. Supply center will be Calamba, Canlubang. Agents caught cheating will be dealt with drastically.

Arrived home at supper time. My wife says I devote more time to my work than to my family.

Such is life with a wife.

January 30, 1942

Still no bombs.

People are still hoping, wishing. Man lives on hope. He is not satisfied with the present. His eyes are fixed towards the future. The present is a more transition, as far as he is concerned. Man will continually reach for the stars. He will never reach them.

The NARIC may ration sugar, according to Mr. Terada.

Must choose 10 responsible dealers or contractors. These will distribute sugar. Must hold them responsible.

Price must be fixed to dealer and public.

The Army will open sugar bodegas.

Dealers must secure the sugar from the bodegas. If they have motor transportation, passes will be issued.

Sugar is sweet. Bombing, said a friend, is sweeter. I prefer to reserve my judgment. I still remember the wisdom of a childhood story: when you open your mouth, flies go in.

January 21-29, 1942

I went to Calamba for a week of rest, taking advantage of the trips which the administrator of Hacienda Real had to make with his car back and forth to Manila. On our way to Calamba, we were behind a luxurious car displaying a Philippine flag. It was the car of General Artemio Ricarte, self-exile in Japan during these past year, in protest to American sovereignty. The newspapers made no mention of his arrival. A number of persons informed me that the Japanese brought him back to make a pro-Japanese campaign. From the news I gathered from various sources, the regions between Manila and Calamba about 56 km. from the capital are the least damaged by the looting and destructive forces of the invaders. Calamba was bombed for being a center of communications but the damage negligible. About five or six bridges on the way to Calamba were blown up by the USAFFE in its retreat, as well as the bridges to Batangas and Tayabas. Meanwhile, the price of sugar has soared due to heavy demand. One could see a long procession of caretelas going to the Central to purchase sugar. Within a few days the stock was sold out. The Real of Calamba is presently the most fortunate of all sugar centrals in Luzon. It stores more than 11,000 sacks. Moreover, it has resumed milling activities. The other centrals were either damaged by the war, looted, or sealed by the Army. If ever they could mill, they cannot sell their sugar since the Japanese Army takes it all, paying what they could pay. American and British-owned centrals, on the other hand, have been confiscated. Don Benito Razón, former president of the Letran Alumni Association, and who had been managing the Canlubang Sugar Central since half a year ago, invited me to dinner. As in other places, the people in this town have fled to the mountains, even if no significant destructions have occurred here. Now that the “milling” season has started, the workers are returning to their work, although milling operations are only at half capacity. The bridges are destroyed and transport to have sugar cane is lacking. Besides, all the sugar produced goes to the Japanese. Due to the good relationships existing between the plantation administrator and the military commander of Calamba, the administrator was able to secure all the permits he needed for the use of cars and wagons to operate the central and sell sugar without restrictions. He was even allowed to reconstruct a broken wooden bridge needed for the hauling of sugar cane and for public use. He is being assisted by an old Japanese employee who has remained faithful to him, preferring to return to the hacienda after being released by the Army rather than taking advantage of the New Order to further his own interests.

May 16, 1936

Abolition of the Bureau of Non-Christian Tribes is announced pending a commission which is to be substituted. It is alleged that the Moros (and Pagans?) object to the designation!

Two articles in the Press show the difficulty of running a government on Quezon’s method of never consulting newspapers:

(a)   Memo. by General MacArthur, in answer to Press criticisms, explaining that the selection of Generals for the new Philippine Army was made without any influence from Quezon.

(b)   Vargas’ explanation of a suggested new yacht for the government, was not merely for Quezon but to replace the Bustamante, the old cable ship, which became more expensive to repair than to substitute a new ship. An editorial in the Bulletin showing that “if a frank statement of intent had been made in the first place etc.”–and concluding: “no apologies are needed.” Quezon gives himself most reluctantly to the press–tho he is not nearly as neglectful of it as I used to be!

Ambrosio–for the past twenty-five years N° 1 chauffeur at Malacañan Palace, came to see me; he says Murphy will not return–(he is now High Commissioner Murphy’s chauffeur); this may be “servant’s gossip” but Ambrosio is in a position to hear a lot!

One hour and a half with Dr. Roxas and Unson at the Survey Board; Roxas expounding the necessity for a fixed and sufficient income for research work–says we must prepare for the “diversification” of industries. He and Unson ridicule the idea that the Philippine Government cannot exist without the fat sugar industry.

After Roxas left, Unson told me confidentially that “something very important” was pending in top circles, and that Quezon would have to return from Hong Kong by the 18th. It is a discussion of the relations of the Philippines with the United States and Japan. If Japan will not undermine the sovereignty of the Philippines, but merely wants trade here, it might be a good idea, according to Unson, to make some arrangement with Japan, in view of the “wobbling” of the United States’ attitude towards the Philippine problem. “We are here in the Orient, and here we stay.” This all-important question was possibly brought to the front by the Davao land muddle. Unson says that he and Vicente Singson wrote recently withdrawing from a dinner group at Wak-Wak because they found at the first dinner held that it was intended for them all to be committed to using their best efforts at whatever cost to secure retention of the United States’ market. Unson says there are plenty of other leading Filipinos who are restive under “too much sugar” in politics. They want to prepare for independence by planning the economic future. (Dr. Roxas is apparently of the same view.)

May 13, 1936

Intense heat these days–97°-100° indoors. In the afternoon Trinidad (who is the manager of the Pampanga Sugar Co.), of whom I asked why no sugar shares were for sale, said this was the time to sell out, not buy, but shareholders expected to get all their capital back in three or four years, and a profit also. However, present prices offered for the shares were too low to tempt holders into the market.

In shopping in Manila, especially on the Escolta, American “salesmanship” is used to the Nth power, with the result that some of us are offended (as I was in Heacock’s today) and leave without a purchase.

Five prisoners escape from Montinlupa–one is recaptured; the “trusty” system seems to have its limits.

At 3:30 p.m. went down to the Coolidge to say good-bye to High Commissioner Murphy and Quezon. The former looked preoccupied and tired. I said to Quezon: “you will see Doria in Peking.” He answered: “Oh! I’m only going to Hong Kong–to be back Tuesday (18th)–wish you were coming with me.” I told him I was staying here under Dr. Sison’s care. The next day, Vargas received a telegram stating that Quezon was not returning until the 28th so probably he will get as far as Shanghai. On the steamer, I chaffed Osmeña about being my “boss” now, and he said “I’m not to be acting President”–Quezon apparently acts on precedents of recent American presidents.

Talk with A. D. Williams. He said Quezon was angry with Bewley, whom he had previously always supported, because the teachers in the Bureau of Education had opposed giving up Teacher’s Camp in Baguio for the National Army as Quezon and MacArthur desire. This worried Bewley greatly, so he apparently saw Quezon and disowned all opposition.

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 25, 1936

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.

Sunday, March 22, 1936

All day at sea and very rough–all hands more or less under the weather. Bridge in p.m. Quezon has, so far, won all the rubbers and we three are all losers.

Talk with Quezon off Panay. I asked him about Philippine sugar shares; he said they were good for dividends for ten years–even after the “sanctions” levied five years hence. He told me that the planters are counting on the continuance of free trade with the United States. I remarked that I had bought some gold shares–he commented “They are good.” I said I was thinking of buying Shaw’s Philippine Iron Company’s shares–he said if you wait, you may be able to buy shares in a government-owned Company in Surigao–“you reserved them for the government twenty-one years ago.” I asked him if they had been recently surveyed and were as rich as we had believed? “Yes,” he replied.

I then asked about the possibility of setting up separate Filipino consulates–said he had taken it up with Secretary Hull before inauguration, and he had referred it to William Phillips. Had received no answer as yet.

Next I reported a conversation with Simmie concerning the arrastre plant. He replied that Simmie is a good man: “if I leave that business in private hands, his company will have the preference–but I want more money from it.”

Said Rodriguez would not remain as head of the National Development Co. He would send him around the world for a year to study industry and commerce, adding: “he talks too much”!

He asked me if I had talked with the High Commissioner about silver–I said certainly not; that I would not go to the High Commissioner about anything official without his instructions. I had asked Weldon Jones about it as he (Quezon) had requested and was waiting his report before making up my own opinion. Quezon said that the High Commissioner had talked with him about it.

We laughed a little over “experts” and he said he was getting one to come out here with only his travel paid.

I asked him if the United States would not give the Philippines the equivalent in silver even if they had refused to pay the losses on devaluation in gold. Quezon said that Morgan had formerly been ready to do this, but businessmen in Manila were carrying on with capital borrowed abroad and they are now afraid their loans would be called if silver in large quantities were introduced into the Philippines currency. He also remarked that the Philippine loss on devaluation was already more than thirty million pesos–especially when computed in terms of trade competition with Japan; he added that the present was the moment to get any benefits or concessions from the United States, before the Republicans get in.

I remarked that the Manila Bulletin was still fighting hard, against us and he replied: “They are the damndest die-hards and reactionaries I have ever seen.”

Next he commented upon Dr. Victor Clark, the financial expert of the American Congress, who had come for a few months to the Philippines as an adviser. Quezon said Clark was able to review all things dispassionately because he wasn’t even prejudiced about the Soviets, and that was the supreme test for an American.

Then he spoke of lawyers, and remarked that Clyde Dewitt was the best American jurist in the Philippines, and Jose Laurel was the best Filipino jurist.

At luncheon, on the steamer I told the President, of his daughter “Baby’s” witty reply to my comment on his speech in Zamboanga, and he sprang up and kissed her, saying; “She is a true daughter of mine.”