The herald., 1898-11-29
HOW THE OBLIGATIONS HAVE
BEEN PILED UP
HOW THEY ARE Distributed
A Clear Statement From a British
Authority-The Sugar Trust
Stock
OFFICE OF THE HERALD,
Los Angeles. Nov. %, 1898.

Los Angeles, NOV. 20 1910.
While in Wall street and elsewhere glib
references are made to the Spanish Phli-
ippine debt, small definite information Is
current as to what really the existing debt
is or what have been the circumstances
under which it piled up. Herewith is sum
mary in which are set forth by u British au-
thority facts of especial pertinence touch
ing this matter.
The Philippines had been down to 1896
q colony possessing sufficient resources to
cover its budgets and even to furnish the
mother country with enough money to de-
fray the expenses of the Spanish squadron
in the five extensive archipelagoes of the
Philippines proper, of the state-supported
mail services with Spain and of the Spanish
consulates and consular agencies in China,
in Japan and in some European colonies OF
the far east. Taking, for instance, the Phil-
ippine budget of 1867, the total expenditure
was f3.45S,772, and the estimated proceeds
of taxation f3,494, 800. The items OF ex-
penditure were G30l5S0 for the general
obligations of the administration, fl4,S00
for the consular services; church and JUS
tice, f397, ,255; army estimates, fl,20S, ,4S8;
finances, f27S,G37 navy estimates, f7l3,-
305; home office, f439,670, and public works,
fl29,039. The revenue was expected to be
drawn from the following sources: Direct
taxation, fl,G95,234; customs, fl,240,ll0;
monopolies and water revenue farmed out
to companies, f204 ,450; lotteries, 1900, 600;
state property, f5l 400; eventual revenue
from various sources, f59,G50. Among the
most productive taxes are the ceduas per-
scnales in direct taxation, which yield
fl29,039. The revenue was expected to be
by the industrial and commercial classes,
G2S0,l4 Under the head of customs the
import duties produce f720,000 and the eX
port duties f25S,5l0. The colonial policy OF
Spain in the Philippines had not been so
protectionist as in the West Indies, and
only of late years had the Spanish protoc
tionists succeeded in inducing their cabinets
to develop the protection granted in their
possessions of the far east to the flag and
products of the peninsula. The last Philip
pine tariff was gazetted in 1891, and a gen
era surcharge of 9 per cent was added in
1896 by the Conservative cabinet of Senor
Canovas. The exports of Spain to the Phil
ippnes averaged over million sterling.
The last insurrection, which began in the
autumn OF 1896, made such demands upon
the resources of the Philippines treasury
that two governors general in succession,
Marshal Blanco and General Polavieja, in
less than six months were compelled to
have recourse to all sorts of devices to meet
the cost of the struggle beforerthe minister
for the colonies could come to their assist
ance with supplies authorized by the Mad
rid government. They laid their hands upon
all the available cash and reserves of the
local deposit and savings banks at Manila,
and obtained advances from the Banco Is
panol Filipino and other establishments of
credit, and even from the powerful monastic
orders that were SO much concerned in the
efforts for keeping up Spanish rule in the
archipeagoes. The imperial government,
happening to have at the time abundant
supplies raised with the sanction of the
cortes for the rebellion in Cuba, allowed
the minister for the colonies at the end of
lSS and beginning Of 1897 to advance the
Philippines treasury in the name of the
Cuban treasury, fl,523,OS0. But the ex-
penditure in connection with the nsurrec-
ton developed at such pace that finally IN
the spring of 1897 the Conservative cabinet,
presided over by Senor Canovas, decided to
let the then minister for the colonies, Senior
Castellanos, present bill. which the oortes
promptly voted, and byswhich the govern
ment was authorized "to grant the general
guarantee of the nation to the operations
of credit that might be necessary with
view to enable the Philippines treasury to
cover the expenditure caused by the dis
turbances and which it had been imposs- i
BILE to cover with the ordinary resources of
the Philippine budget" Accordingly a
royal decree was issued, laying down the |
regulations "for the issue of a Philippine |
loan of eS,00O,OO0 nominal, in per cent
stock, redeemable in forty years, with
special lien on the customs revenue of the |
and besides the general guar
antee of the nation in virtue of the law of |
June 10, 1885,"
Under this decree 100000 twenty-pound |
bonds were created in two SERIES Series A, |
of 250000 bonds of 800 pesetas
each, was reserved to be placed in Spain;
series B, consisting of 900 bonds OF 100 |
pesos each, was destined to cover the liabili-
ties isfcurred by the Philippines treasury
at Manila. The Hispano Colonial bank
undertook to pay the interest and amortza-
tion of series a in pesetas in Spain and OF |
series b in pesos at Manila. And in the
Madrid Gazette Of Oct. 20 last there are
published statistics which show what the
Spanish government has done with the pro-
ceeds of this loan. The document is styled
Account of the Cost of the Campaign in the
Philippines from Oct. %, 1896, to June 30,
1888" The assets are put down at f7,7l4,-
DOG, produced by the placing in Spain of
100000 bonds of the A series of the Philip
pines loan, issued at 02, by further issue
Of lO6,252 Philippine bonds of the b series,
and by sundry profits realized on the coin
age OF silver and on the bills for the Phil
ppines treasury. 1t will be seen, therefore,
that the government did not make use of
The whole of the 100000 bonds that it had /
been authorized to issue. The official statis-
.lcs further show that out of the E7,7l4,-
)96 actually realized, $685., 800 were paid
'ut to the Philippines treasury almost en-
.irely for war expenditure; fl, ,532, ,OsO were
Used to reimburse the advances of the Cuban
treasury during the Philippine insurrection;
t2, lSS,596 were advanced to the Cuban
treasury. and have not yet been returned by
The same, and f15,36O represented the cash
balance in hand on June 80, 1898. 1t seems
,hat out of the $50, 900 per cent bonds of the
A series created by the decree of June %
1897. HOO have already been reimbursed by
quarterly drawings for amortization, and ont
If the 10000 bonds of the B series 700 have
'een reimbursed also by quarterly draw.
pgs. Consequently there are still in cir