The daily morning journal and courier., 1898-12-12
PORTO R1co,s CURRENCY.
History of the Question Given by Asst,
 Secretary of State.

Washington, Dec. 11.-Assistant Sec retary Vandelip in his second informal report of his observations in Porto Rico says that the history of the currency question is about this: "The island some months ago was using American currency, At the time of the emancipa- tion the Spanish government found the value of silver declining and it discov- cred it would be profitable to make payment in Mexican dollars and in that way the currency was brought to S l.
 yer basis. The heavy payments for crops made redundant currency and a great deal of it was shipped away. The Spanish government gave a new peso a
 certain redeemable quality and l un- derstand that some of the coins have been redeemed in gold.
 "One of the commanders reports to me that a condition that must be taken into account is the ownership of | most of the plantations. They ate nearly all owned by Spaniards residing in Spain have, year after year, been cultivated at an extremely low labor | cost. About the only thing that has been imported is Q little calico and while the trade returns show large
 excess of exports the value of those eX-
 ports never return in any form to the | island. When the American troops landed it was thought an easy tenn porary solution of the situation to fix
 the rate of exchange of American dol lars and pesos. That worked for a lit-
 tie while, but the exchange dealers soon found that they could make a more profitable ratio and our ration became effective
 ''The army officer with whom I talk | ed is in favor of an immediate forced substitution of our currency for the | present Porto Rico currency and thinks | this might be doEe by military order, fixing the rate of exchange. The ques- | tion is what rate should be fixed. Ex- | change dealers have controlled the sit
 uation with little reference to the actual l balance of trade. There is q great amount of small debts. No one seems
 to work without the spur of debt be-
 hind and to compel the repayment of
 these debts in coinage more valuable | NpuId bt d IL lS DtlltNGu Uy | some that to undervalue the peso
 guaged by the average exchange, would
 work less hardship and would really come nearly being just. It would en- able the smaller debtors to more easily
 meet their oblizations. It was suggest | ed to me that with respect to the is-
 sues of the Spanish bank the debts
 might be redeemed in our money at the same rate of exchange we allow in the | United States
 The scheme of taxation is something
 like this: The central government lev | jed on the municipalities Ca municipali-
 ty covers rot only city but district)
 certain amount that must be collected 1 for the support of the government The l municipality added to that further sums l for local expenses. The scheme of tax
 ation by which this was collected va
 ries in the different municipalities. Il
 is quite the reverse from our internal
 revenue taxes for little if anything is laid on the manufacturers of spirits and 1 tobacco. The raising of taxes on spir-
 it's would be 9 popular movement. Il
 is thought by some tha. for the pres. | tHL we dlt COlleCllilt5 lup iluCh lcNSuut for the reason chat up to to this time there has been practically no expendi. ture. There has been great deal o1
 disturbance and destruction of property
 in Aguinaia and in Mayaguez. It i: thought that half million dollars
 worth of property has been destroyed
 and that practically nothing could bt
 raised there this season.