The Worcester spy. [volume] (Worcester, Mass.) 1898-1904, 1898-12-12
CURRENCY.
anderlip's Report On Its
History in Porto Rico.


Washington, Dec. 1I-Assistant Sec
rotary Fanderlip, who is not expected
here now until Dec 20. in his second
informal report Of his observations in
Porto Rico, says that the history of the
currency situation is about this
The island some % years ago was
using American currency. AT the time
Of emancipation, the Spanish govern
ment found the value Of silver decln-
ing and it discovered it would be profit
able to make payment in Mexican dol
iafS ana in that way the currency was
Drought TO a silver basis. The heavy
payments for crops made a redundant
currency and a great deal of it was
shipped away.
eventually the government decided
on coinage for the island, making a
Iurlher profit by debasing the silver in
tHe peso The silver in the peso ia
wv me The Spanish government gave
TINS new peso a certain redeemibility bv
oHerlng to redeem at the Bank of Spain
at MADRID, at 95 in gold, and I under
STAND that some of the coins have been
redeemed at that rate, although com
paratiVely few Of them have been car
ried back to Spain.
one of the American commanders
reports TO me that a condition that
must be taken into account is the own
ership Of most of the plantations. They
are nearly all owned by Spaniards a
great many of them by Spaniards re-
siding in Spain. This has resulted. in
stead of an apparent balance Of trade
considerably in favor of the island. in
a real balance against the island The
great sugar plantations, owned by peo-
pie residing in Spain, have, year after
year raised a crop of sugar at an ex-
tremely low labor cost. The sugar has
sold abroad, and practically the whole
return for 1t has remained abroad. Gre
ating no demand for exchange against
the island
about the only thing that las been
imported is a little calico, and while
trade returns show a large excess of
exports, the value of those exports
never return in any form to the island.
When the American troops landed, it
was thought an easy temporary solu
ton Of the situation to fad the rate
of exchange as between American dol
lars and pesos at two fo7 ono. That
worked satisfactorily for a little while,
but the exchange dealers soon found
that they could make more profita-
Bile rate Of exchange, and our ratio
therefore became ineffective and in
operative. The settlement of the ques-
ton lies between two extremes; on the
one hand the fixing of the value Of the
peso at the exact value OF the bullion,
and on the other giving an equivalent
gold value equal to the nominal re-
deemable rate Of %, which the Spanish
government fixed.
AN army officer with whom I
talked, is in favor of an immediate
forced substitution of our currency for
the present Porto Rican currency, and
thinks this might be done by military
order. fixing the rate Of exchange. The
question is, what rate should be fixed?
1t is not believed the average rate of
exchange for a series Of years should
be taken. Exchange dealers have con-
trolled the situation with little refer
ence to the actual balance of trade. It
would be a hardship on the debtor
class to have the peso too high and the
debtor class is the whole working pop
ulation of the island. There is a great
amount of small debts No one seems
to work without the spur Of a debt be-
hind him, and to compel the repay
ment of these debts in a coinage more
valuable than that in which they were
contracted, would be a great hardship.
1T is believed by some that to under
value the peso gagged by the average
exchange rate, would work much less
hardship and would really come very
near being just Il would enable the
L. 1. 81, rgsf1v at
their obligations, and would even if
the exact bullion value were taken as
a basis. still offer ample profit to the
money lenders, for they have oppressed
the borrowers with an ingenious varie-
tv Of methods. 1t was suggested to me
that. with respect to the issues of the
bank, they might be redeemed
in our money at the same rate OF eX-
change which we fix on the peso II
that rate is low, then the bank can bet
ter attempt the redemption.
"Tbe volume of currency is said to be
much smaller than is generally estt-
While the original currency
was from 5000 900 to 100000 pesos, 1t
is thought by some that there may not
now be more than 1000 900 that would
be exchanged.
attempts are now being made to
collect internal taxes, but at present
armed guards have to be sent with the
collector. The scheme of taxation IS
something like this: The central. gov
eminent levied on the municipalities "a
covers not only Guy,
but a district a certain amount tlat
must be collected for the support OF tne
The municipality ados 10
fbof further sums for local eXpendl-
Of Ia WIlGn
tbie total amount was collected varies
~ tbe different municipalities. 1t is
- tho reverse from our internal
,ta,,enua taxes. for little if anything Is
IA On the manufacture of sDlrlts ana
@The best opinion is that the, judiclous
;,,+roduotion of our internal revenue
system and the abandonment oil Ihe
system would be wise; Inc
.dpieine of taxes on spirits would be
,,r,e,,ier movement and the abandon
i,,ant If other forms of taxes Would give
tba new scheme further popularity II
's tbonght by some that for the present
~ IRE collecting too much revenue loi
tba raason that up to this time there
HAS been practically no expenditure.
.rbare has been good deal OF uIs-
t,,rbance and destruction OF pFope4 ~
IN Aeuadilla, the province at Ihe no ~
,ne St corner of the island, and IN MAY
" o re If is thought that half million
- si 49,. worth of property has been des-
loIaiI in Aguadilla and that prac-
sio9Iv nothing could be raised there
this season.
wheat shred brown bread and wheat
w iies Steamed fruit pudding, either or
10Th , by speaking to the driver oil , ts5lii
~ ~, felephone or postal to Shreuasu