present debt of the Philippine Islands being $15,000,000, amounts to about $1.62 per capita for a population of 8,000,000, and the annual net interest charge to less than four cents per capita. The United States has a per capita debt of at least $12 and annual charges of more than 30 cents. Great Britain has a debt in excess of $90 per capita and interest charges of $3. France has a debt of nearly $150 for each of her people and an annual interest burden of $6.

It is true that these are richer countries than the Philippines and that their gross revenue is larger. The true test of interest burdens should perhaps be the ratio which they bear to gross revenue. But here also the test is in favor of our island dependencies. In France 30 per cent. of the revenue goes to meet the charges on the debt; in Great Britain 19 per cent.; even in the United States about 5 per cent, without counting State and local indebtedness. In the Philippines the proportion is about 24 per cent. Tried by every test, therefore, the burden on the people of the Philippines for their bonded debt is among the lightest imposed by modern states, and they are well able to make a further appropriation from revenue to provide for railways and other public improvements.

There are few, if any, civilized states, moreover, which have so much to show as the Philippines for the debt which they have incurred.

Expenses in the Philippines.

The Secretary of War reported to the Senate June 19, 1902, that "the amount of money expended, and the amount," so far as practicable to state it, "for which the Government of the United States is liable, remaining unpaid for equipment, supplies, and military operations in the Philippine Islands each year from May 1, 1898, to the present time," aggregate $170,326,586.11, as follows:

"Attention is invited to the fact that large quantities of valuable property, such as ships, lighters, etc., horses and mules, wagons, harness, clothing, equipage and ordnance, medical, signal, and engineer supplies, the cost of which is included in the foregoing statement, still remains on hand in the Philippine Islands for use. Parts of these supplies are already being reshipped to this country. It should also be observed that a large part of the expense during the past year should not properly be treated as occasioned by military operations in the Philippine Islands, for the reason that it consists of pay and maintenance of troops whom we would have had to pay and maintain whether they were in the Philippines or not, in order to keep up the minimum number of regular troops required by law as a safeguard against future contingencies. The minimum at which the Regular Army is required to be maintained by the act of February 2, 1901, is 59,657 men, and the maximum is 100,000."

The Problem Which We Have on Our Hands in the Philippines.

Extract from address of Hon. Wm. H. Taft, Secretary of War, before the Chamber of Commerce of New York City, April 21, 1904:

The people of the United States have under their guidance and control in the Philippines an archipelago of 3,000 islands, the population of which is about 7,600,000 souls. Of these, 7,000,000 are Christians and 600,000 are Moros or other pagan tribes. The problem of the government of the Moros is the same as that which England has had in the government of the Straits Settlements or India. The government of 7,000,000 Christian Filipinos is a very different problem, and one which it has fallen to the lot of the United States only to solve.

The attitude of the American people toward the Philippin islands may be described as follows: There are those who thinl that the Declaration of Independence forbids our accepting a maintaining sovereignty over them; there are those who, without respect to the Declaration of Independence, believe that colonial possessions are likely to lead to expense and corruption and demoralization, have little faith in the solution of the problem by teaching the Filipino the art of self-government, and are anxious to get rid of the islands before they have done any harm to the United States.

As a

Then there are those who hold that fate brought these islands under our control, and that thus a duty was imposed upon us of seeing to it that they were not injured by the transfer. friend of the Filipinos it is my anxious desire to enlarge that class of Americans who have a real interest in the welfare of the islands, and who believe that the United States can have no higher duty or function than to assist the people of the islands to prosperity and a political development which shall enable them to secure to themselves the enjoyment of civil liberty. [Applause.]

In the Philippine Islands 90 per cent. of the inhabitants are still in a hopeless condition of ignorance and utterly unable intelligently to wield political control. They are subject, like the waves of the sea, to the influence of the moment, and any educated Filipino can carry them in one direction or the other, as the opportunity and the occasion shall permit. The 10 per cent. of the Filipinos who are educated have shown by what they have done and what they have aspired to and what they are that they may be taught the lesson of self-government and that their fellows by further education may be brought up to a condition of discriminating intelligence which shall enable them to make a forceful and useful public opinion. But that it will take more than one generation to accomplish this everyone familiar with the facts must concede.

*

My own idea of the mission of the United States in the Philippine Islands is that it ought to be maintained and encouraged by the people of t. e United States without regard to the question of is cost or its profitable results from a commercial or financial point of view.

The islands themselves give every indication of furnishing revenue sufficient to carry out the plans which the United States may properly carry out in the material and intellectual development of the country and its people. The taxpaying capacity of the country is, of course, determined by that which it produces for domestic and foreign use.

*

The Philippine Archipelago is the only country in which can be produced what is known as "manila hemp," or what is called in the Spanish language "abaca." This is a fiber of enormous strength, of from 6 to 15 feet in length, which is stripped from the stalk of a banana plant-not the ordinary banana plant, but a plant of the same family which does not produce fruit.

Many parts of the islands are very rich in cocoanuts. The cocoanut grove is planted 200 to a hectare; that is, 200 to 2% acres. It takes four or five years for cocoanut trees to bear. After that they will bear for 100 years, and a low price for annual rent is $40 gold a year an acre.

The sugar and tobacco industries in the islands are capable of a considerable increase. The island of Negros contains sugar land as rich as any in the world, and the provinces of Cagayan, Isabela, and Union contain tobacco lands which, next to Cuba. produce the best tobacco in the world, but the trouble is that the markets for such sugar and tobacco have been, by tariffs imposed in various countries, very much reduced. Should the markets of the United States be opened to the Philippines it is certain that both the sugar and the tobacco industry would become thriving, and although the total amount of the product in each would probably not affect the American market at all, so extensive is the demand here for both tobacco and sugar, it would mean the difference between poverty and prosperity in the islands.

I know that the reduction of the tariff for this purpose is much opposed by the interests which represent beet sugar and tobacco; but I believe that a great majority of the people of the United States are in favor of opening the markets to the Philippine Islands, conscious that it will not destroy either the beet-sugar or the tobacco industry of this country, and feeling that as long as we maintain the association which we now have with the Philippine Islands it is our duty to give them the benefit of the markets of the United States and bring them as close to our people and our trade as possible.

There are 7,600.000 Filipinos. Of these, the 7,000,000 Christian Filipinos are imitative, anxious for new ideas, willing to accept them, willing to follow American styles, American sports, American dress, and American customs. A large amount of cotton goods is imported into the islands each year, but this is nearly all from England and Germany. There is no reason why these cotton goods should not come from America.

The first requisite of prosperity in the Philippine Islands is tranquillity, and this should be evidenced by a well ordered government. The Filipinos must be taught the advantage of such a government, and they should learn from the government which is given them the disadvantages that arise to everybody in the country from political agitation for a change in the form of government in the immediate future. Hence it is that I have ventured to oppose with all the argument that I could bring to bear the petition to the two political conventions asking that independence be promised to the Filipinos.

It is not that I am opposed to independence in the islands, should the people of the Philippines desire independence when they are fitted for it, but it is that the great present need in the islands is tranquillity.

The Prevailing Sentiment in the Philippines Regarding the United States and Its Treatment of the People of Those Islands.

The following are extracts from remarks of Dr. N. Pardo de Tavera, the head of the delegation of Filipinos visiting the United States in 1904. The remarks were delivered in Washington, D. C., during the visit of the delegation to that city:

"In the Philippines we knew nothing of you. We lived under a government which ruled through fear and imposed upon us civil and religious tyranny. To the extent that we were accustomed to that kind of tyranny, we feared it would be continued under the American rule and be far worse. We did not know at the time of the beneficent purposes' which animated you, and no man can condemn us for fighting when we were under that erroneous impression. But so soon as we learned what these purNone of you poses were we were glad to accept these conditions. can appreciate the emotions which welled up within us when our eyes rested upon the White House, within whose walls your beloved President McKinley evolved the intention of stretching out his beneficent hand to us to raise us up to the ane upon which you now stand and place us within the same beliefs that you now have in this great country. You have done something unique in the history of the world. Some nations have colonized for the purpose of extending their religious beliefs; others with the intention of extending their commercial and industral interests, but you have carred these principles of liberty and democracy to the peoples of the countries where you have placed your foot and your flag."

THE HAWAIIAN ISLANDS.

Development Since Annexation.

General conditions in the Hawaiian Islands show a marked improvement since annexation. Owing to wise administration there is a closer touch evident between the executive and the people, and political differences arising from local conditions have found a neutral ground in the common cause of Hawaii's welfare and future status. There is a growing sense of the responsibility OL the part of the electors as they appreciate their accountability for the use of the ballot. In 1900 there was but little interest shown in the sending of delegates to the national conventions, while this year the keenest competition developed for places on the delegations. No single event since annexation is more expressive of the progress and the future possibilities of Hawaii than the completion of the cable connecting Hawaii with the mainland and the Orient. The Hawaiian silver has been practically retired from circulation and its place taken by currency of the United States.

The successful growing of coffee and tobacco, also the growing and canning of pineapples is no longer an experiment: four large pineapple plantations are well started and two of them are alThe sisal indusready sending their products to the mainland.

try has also been demonstrated. The traffic in bananas has increased materially, especially from the port of Hilo, where in six months' time it is expected that the monthly shipment will reach 20,000 bunches. The industry will grow with the increase in the number of steamers between Hawaii and the mainland.

The last seven years have seen a large development in sugar, the main industry. The increase from 251,126 tons in 1897 to 437,991 tons in 1903 does not tell the whole story. There is not a plantation on the islands that has not, during these years, modernized its equipment in the sugar factories. During this period it is calculated that over $40,000,000 has been spent, mostly on the mainland, for machinery and other improvements, all of which are now installed.

Since annexation extensive improvements have been made in the capital city, especially in the business districts. The wharf system has been materially extended and modernized. A trolley system has been laid through the city and its suburbs. These improvements have been made with material purchased in various parts of the United States and have changed substantially the appearance of the water front and city.

Perhaps the most remarkable development in Honolulu since annexation has been the education of the lower classes in sani

tation. Modern methods in the prevention of diseases and the precautionary measures to stamp out diseases as they appear are now understood by Honolulu's alien population. There has been established by the Federal Government on Quarantine Island, or the edge of Honolulu Harbor, one of the largest and most efficien: quarantine stations of the United States.

Hawaii looks forward with extreme eagerness to the completion of the Panama Canal, for the following reasons: Ships coming through the canal from Europe to the Orient will touch Hawaii for orders, repairs, and for the necessary coal, fuel, oil, and provisions. It is reasonable to expect that the opening of the canal, together with the expected increase in trade caused thereby, will result in a large increase in the American marine and that most of the vessels engaged therein will make the Hawaiian Islands a port of call. The benefits to Hawaii of this trade, aside from the greater facility of shipping the Territory's produce, will undoubtedly be substantial.

Since 1897, the year before the annexation of Hawaii by the United States, the exports from that island have practically doubled, increasing from $13.687,799, during the fiscal year ending June 30, 1897, up to $26,242,869 during the year ending June 30, 1903. Within the same period the imports of merchandise from the United States have more than doubled, from $4,690,075 in 1897 to $10,840,472 in 1903. Last year the balance of trade in favor of this Territory was $15,400,000.

A remarkable exhibit is made by comparing the trade growth per capita of population in Hawaii, which shows an increase from $131 up to $247 under annexation for every man, woman, and child in the Territory, a total per capita of trade that is more than eight times greater than that of the trade per capita for the entire United States. Thus:

from foreign countries

Last year's imports into Hawaii amounted to $3,036,583, as compared with $10,787,666 from the United States.

Hawaii's staple product for export is, of course, sugar, and its output has more than doubled in quantity and in value within the past eight years, though there has been but little variation in the average export price for each year. As this is the prinsipal commodity that affects the prosperity of the Territory its importance will be realized from the following exhibit:

Quantity and value of sugar exported.

All of this sugar is sold in New York or San Francisco and affords cargoes for American steamers and sailing vessels, amounting to nearly 400,000 short tons, besides the smaller shipments of coffee, sisal, fruits, hides, etc.

Last year there were 61 steamers and 211 sailing vessels that entered at Hawaiian ports from the mainland, and 247 cargoes of 399,584 tons left this Territory for ports of the mainland in

the same period, all of these cargoes being carried in American bottoms. Only five American vessels, of 4,288 tons register, left here in ballast, while twenty vessels of foreign nationality, of 25,397 tons register, had to go elsewhere in ballast seeking freights.

As a matter of fact, one American vessel leaves this American Territory for the mainland every one and one-half days with a cargo produced on American soil for the consumption of the American people.

While the current receipts of the Territory of Hawaii show an increase of only $200,000 for the year 1903 as compared with 1897, the year before annexation, there have been considerable fluctuations in the interval, the receipts aggregating as high as $3,345,231.50 for the year 1899, due mainly to a gain of nearly 50 per cent. in the receipts from customs in that year.

In the year 1900 the Federal Government assumed control of the revenues from customs, post-office and internal-revenue sources which aggregated $1,600,000 in 1899. Deprived of this large proportion of income, it became necessary to increase our system of direct taxation, which shows a jump from $763,984.84 in 1897 to $1,300,347.92 in 1900, and up to $1,678,362 in 1903—a gain of more than $900,000 per annum ($6 per capita increase) within the seven-year period.

Expenditures in Hawaii show an increase of nearly $900,000 within the same seven years, from $1,999,024.59 in 1897 up to $2,884,563.12 in 1903. That this additional government outlay was judiciously expended is shown by the fact that there was a gain of $440,000 in the outlay for public works and improvements and of $180,000 in providing additional and improved education.

There has been a wonderful growth in the schools of Hawaii since annexation. In 1899, the year after annexation, there were in the islands 189 schools, containing 15,490 pupils taught by 544 teachers. On December 31, 1903, there were 19,022 pupils in 204 schools, taught by 647 teachers. No complete statistics have been collected since 1903, but there must be over 20,000 pupils in the various schools of the Territory at the present time. Thus, since annexation there has been an increase of 3,552 pupils, or about 1,000 per annum. To meet this, up to December 31st of last year, there was an increase of 15 schools and 103 teachers.

It has been frequently charged that Asiatics formed the bulk of the pupils. This is one of those careless statements bandied from mouth to mouth without thought, and frequently believed. Indeed there are those who will asseverate that this is a fact. A little consultation of statistics will show the utter fallacy of the statement. Of the 19,022 pupils in school on December 31, there were 8,199 Hawaiians and part IIawaiians, the whites numbering 5,882, making a total for Hawaiians and whites of 14,081. The Japanese children in school numbered 2,740 and the Chinese 1,585, while the Porto Ricans brought up the rear with 616. These latter, however, should be counted with the Hawaiians and whites, being American subjects.

Of the 647 teachers reported at the close of 1903, there were 163 Hawaiians and part Hawaiians, 303 Americans (or nearly half the total number), 55 British, 13 Germans, 55 Portuguese, 15 Scandinavians, 9 Japanese, 16 Chinese, and 17 of other nationalities. All the Japanese and 13 of the Chinese are employed by religious or philanthropical institutions sustained by private funds.

PORTO RICO.

Porto Rico was occupied by the United States July 25, 1898. On August 12, that same year, the protocol was signed and military operations ceased. On October 18 Spain withdrew from the island and a government by the United States military authorities followed, and this military government was maintained until May 1, 1900, when a civil government was instituted under an act of Congress devising a special form of government for the island. The organic act was presented by Senator Foraker, and after more than four years' operation has been proved by experience to be a wise and temperate measure. It embodies as much self-government as the most thoughtful and intelligent natives of the island would recommend. It provided for an