Evening star., 1934-04-19
Ne'D Deal in Virgin Islands
Brings Control to Industry
Federal Company Has Almost Unlin'-
tied Po,cers in Bringing About Eco
nOnic Rehabilitation in Area.
BY THOMAS r. HENRY.

BY THOMAS r. HENRY.
Details of the most thoroughgoing
of all the new deals proposed eco
nomic experiments-the rehabilita-
ton Of the poverty-stricken Virgin
Islands through a Federal corpora.
ton with almost unlimited powers
have just been received here.
A measure defeated by the Colonial
Council Of st. Croix, but passed by the
Colonial Council of st. Thomas, has
paved the way for the establishment
of this corporate body with powers
which appear, on the face of the
measure, to 60 far beyond the utmost
ever before granted to a Federal
agency in peace time.
st. Croix, with a population OF
slightly over $4,000, is the largest and
most populous Of the Virgin Islands
Department Of the Interior officials
maintain, however. that it is largely
dominated by large land holders and
that st. John, whose council passed
the measure. is the center of the in
dustries whose bad condition is largely
responsible for the woeful state of the
people.
Project Insured.
If both councils had turned down
the measure, it was stated at the In
terror Department, the Virgin Islands
Co. would have been incorporated in
the District of Columbia or Delaware
and the project gone ahead Just the
same.
Gov. Paul M. Pearson of the Virgin
Islands is now in Washington while
the final details of the project are
being arranged. The Advisory Coun-
Gil, headed by Secretary Ickes. will
hold its first meeting today. Other
members are Secretary of Agriculture
Wallace, Alfred K. Stern of Chicago
George Foster Peabody of Saratoga
Springs, N. Y; Walter White and
Charles Taussig of New York City
and DR.. Mordecai w. johnson, presi-
dent of Howard University.
The details of the plan were out
lined at the Interior Department yes
terday.
First a 100000 grant was allo-
Gated by the Public Works Admins
tration to the public works admin
istrator Of the Virgin Islands. This
official then proceeded to obtain op-
tions on whatever property was
deemed essential for the plan.
To Be Kept Local.
The next step was the incorpora-
ton of the company. 1t might have
been incorporated anywhere, but au-
thority to do so in the Virgin Islands
was sought to keep the project as
local as possible. The bill was first
submitted to the St. Croix Council.
It was voted down. 1t then was sub
mitted to the St. Thomas Council
with one important grant stricken
out-the right of emminent domain.
This made no practical difference,
1t was explained, since options were
held, or could be obtained, on every
thing needed. With this modification
the measure was passed and the cor
poration formed. Its first meeting
was held at the Interior Department
Monday.
The property held under options by
the public works administrator now
will be leased to the corporation fol
a nominal sum of $500 a year, which
will come back to the Treasury. The
company will operate the sugar, rum
and bay rum industries of the island
Profits to Be Split.
Whatever profits are obtained will
be split in half. One-half will be
prorated among the workers-that is
practically the entire industrial popu-
lation of the islands-in the form oi
bonuses. The other half will be used
for welfare and development work
especially health work, on the islands
While the company has what
amounts to a monopoly over the busi-
ness of the islands, its present plans
do not 60 beyond the sugar, rum ano
bay rum industries. 1t is going heavily
into the rum business and a fine
brand of this beverage soon is to be
placed on the market.
1t was learned on good authority at
the Interior Department that if the
plan proves successful in the Virgin
Islands, authority will be sought to
extend it to other island possessions
of the United States. Whether II
could be applied to a State involves
some fine legal questions, but the cost
probably would be prohibitive, and
the same economic questions are not
faced.
While the company has essentially
a monopoly, if it chooses to exercise
it, over all business of the Virgin
Islands, it is not at present proposed
to exercise it under the present set
up. but rather to encourage private
enterprise This, however, must show
a real disposition to serve the public
People Gouged.
There has been a good deal o1
gouging of the people in the past, il
is claimed, and this will no longer
be permitted.
The islands still operate under q
modification of the laws of a Danish
crown colony. OF the 18 members
Of the St. Croix Assembly, 13 are
elected and five are appointed by the
Governor. The Governor, further.
more, has the right Of absolute veto
over any of the Assembly's acts an6
the authority to dissolve it at his
pleasure.
Although the proposed establish.
ment of the company was announced
through the Department Of the Inte.
rior at about the time of the recent
visit of Mrs. Roosevelt to the Virgir
Islands, the sweeping powers to bs
conferred upon it were apparent only
with the receipt here of copies of thu
measure as 1t was introduced in tn,
Colonial Council.
Nature of Business.
Among the provisions are the fol
lowing:
"The nature of the business to b'
transacted and the objects and pur'
poses to. be promoted and carried OF
by the corporation shall be:
ITO aid in effecting the economi,
rehabilitation of the Virgin Islands O
the, United States and to promote th'
general welfare of the people Of th'
Virgin Islands of the United States