Evening star., 1902-02-26
MONEY FOR FILIPINOS
SYSTEM RECOMMENDED By MR..
CONANT.
Based on Gold, but Represented by Sill.
yer Coins-Result of His Visit
to the Orient.


1t is a well-known fact that the task of
the United States in the Philippines will
not be concluded when the pacification of
the islands is an assured fact. So much
money has not been spent and so much
blood shed simply for the purpose of sat
isfying a vain ambition. The possession
of the Philippine archipelago will facili-
tate the acquisition Of the Japanese and
Chinese markets. and may be looked upon
as stepping stone permitting passas se
from one bank to another
The government of the United States. in
order to excite the spirit of enterprise of
the Americans to give attention to this
part Of the world and at the same time as
sure the economic development of the
country, is of the opinion that the prin-
cipal thing to do is to provide the Philip
pines with q monetary system suitable to
the new conditions established by the ac-
QUESTION without entirely abolishing the
former system. This was a very delicate
problem and required at the very outset
proper solution, experience having
shown, especially in India. what injury can
be wrought by experiments.
MI. Conant's Mission.
Secretary Root understood the condition
of affairs perfectly Before making a de-
cision in the matter he desired to under
stand it perfectly. He therefore commits
stoned Mr.. Charles A. Conant the we'll
known economist, to study the actual
monetary conditions on the ground as we'll
as the needs of the country, and to elabo-
rate the system of currency which he
should consider best suited thereto. Mr..
Conant conscientiously fulfilled his mission
and did not confine his Investigations to the
Philippines, but extended them to other
| nearby countries. especially China and ia
pan. AS a result of his Investigations he
| submitted recently a very full report to the
Secretary Of War. which was accepted by
him and by a special commission charged
with its examination. and has been finally
embodied in the Lodge bill now before the
Senate.
The chief medium of exchange in the
Philippines is the Mexican dollar. which
is scattered all over Asia A small guam
tity Of notes issued by the Spanish Philip
pine Bank is also in circulation. But this
| money, without considering the great de-
probation it has suffered as a consequence
Of the voluntary or forced reputation Of
it by countries which had formerly used
large amounts thereof. has a value SUBJ
ject to more or less f1uctuatiOn caused not
only by the conditions Of the precious met
al markets, but also by the variations in
the amount produced by the Mexican
mints. This state of affairs is especially
serious in country desirous of extending
her relations with countries which have
adopted the gold standard.
System Based on Gold
Mr.. Conant proposes to establish in the
Philippines a system based upon gold but
represented principally by silver coins, a
system which will offer the great advan-
tage of substituting for an unstable cur
rency currency having a fixed value,
without disturbing commercial transac-
tions.
The principal points of Mr.. Conant's plans
are the following:
1. That there be a distinctive Philippine
oof,, oP II; ,;n}, ,hoI ~ r1<-
for 80 cents in the gold money Of the
United States.
3 That this distinctive silver coin be
known as the peso, shall contain % grams
Of silver Of the tineneSS of O.S35 and be
divisible into 100 equal parts, called CEN
tavos.
3. That this coin be issued by the govern
ment Of the Philippine Islands in such
quantities, to be determined by such gov
ernment. as may be required by the needs
of trade.
f. That the distinctive coin be maintained
at par with gold by the limitation of the
amount coined and by gold reserve, to be
constituted from the seigniorage derived
from the coinage of silver bullion, and to be
employed, in the discretion Of the Philippine
government. for the direct exchange Of sill
yer for gold, and in such other ways as
may be necessary to maintain the parity
fixed by law.
g. That the new silver coins and the gold
money of the United States, when not 9TH
erwise stipulated by the contract be the
sole legal tender for public and private OBJ
legations.
The Peso Similar to the Dollar.
The Philippine peso will thus have the
same weight and dimensions as the Amer
lean dollar, but it's value will be only one
half the latter: that is to say, that for the
Philippines, instead Of adopting a ratio of
16 to 1, ratio of 80 to ! will be adopted
This coin will practically have the same
value and dimensions of the Mexican peso
and can thus readily and without difficulty
be used in trade, and not be subject to the
fluctuations which the Mexican peso suf-
fers. This Is sufficient to show why the
American system Of currency could not be
adopted for the Philippines without caus-
ing great disturbances in trade and in the
amounts of salaries
In order to maintain the ratio Of 80 to /
MI Conant proposes two methOds-the linn
1tat1on Of the amount of the coinage and
the interchangeab bility Of the cheaper metal
with the standard metal at the ratio fixed
by law. The latter will be secured princi-
pally by the constitution of a reserve fund
to the amount of the seigniorage or profit
derived from the coinage of silver bullion.
This profit would be from 10 per cent to Is
per cent of the face value of the coins is
sued. and upon an issue of 4O.O0O.OOO pesos
would be from 100000 to 6,OOO.OOO pesos
The author of the plan believes that this
would be sufficient. Additional powers will
be given to the Philippine government to
assure the security Of the system, such as
the power to sell gold drafts, to issue tenn
pOrary certificates Of Indebtedness and to
buy gold coin or bullion