Evening star., 1950-06-04
Weak Philippine Link

Continued From Page CID
three principal sources: % Amer
lican expenditures In the Philip
lpines for such things as mainte-
nance Of bases. personnel. pur-
chase Of materials. payments to
Filipino veterans in the American
forces. (2) American payments
on war damage claims to individ-
uals and go payments to the
philippine government for reha-
bilitation and restoration of such
things as public roads. bridges and
buildings destroyed in the war.
Altogether more than 50 billion
have been paid in the Philippines
for these purposes. American
expenditures for goods and services
have totaled SIS billion. War
damage claims have totaled $40O
million of the $500 million orig
inally agreed on. tThe Philip
pines now seek to raise this figure
to $500 million. citing increased
dollar values Of property since
before the war; Philippine re-
Mobilization payments have totaled
$125 million.
Imitation Threat
Since the war, then, more than
$2.3 billion have flowed into the
Philippines. The Philippines post
war currency reserves totaled $500
million, but today are down to
5000 million, which means the
islands are well on the way to
Iprinting-press money and q
Chinese-type imitation.
Thus $2.7 billion have been
drained out of the islands. What
for? Official Philippine represen-
tatives. while admitting some
squandering as the result of cor
ruption. black marketing. ETC.,
contend that the major part of it
was for restoration of property
homes. buildings, factories and
other structures destroyed in the
war.
American critics of the Philip
pines contend that far more has
gone for luxury goods than should
have gone. They liken the num-
ber OF expensive cars in Manila to
those in Washington. A seven
year supply of hair oil is in storage
in Philippine warehouses. Ameri-
can cigarettes find a big market In
the islands, despite the fact that
the islands are tobacco producers.
| While dollars have poured out
OF the country not only for recon-
struction goods but for luxuries,
the governments finances have
scraped bottom. Deficit financing
is the governments policy. This
year the deficit is in the neighbor-
hood Of $100 million and by 1852,
it is estimated, it will reach $500
million. The government has got
ten operating funds in loans from
government banks and from trust
and sinking funds.
i Not nearly enough money for
the governments needs comes
from taxes. Two things are to
blame for this: Inadequate tax
laws. which, the Philippine Con-
gress has not shown a disposition
to remedy. and tax collection ma
chinery which does not collect.
| With high enough taxes and an
efficient tax collection system, the
; government should have been able
to draw of for its own needs, and
for the maintenance of its reserve,
large part Of the dollars that
have flowed into the islands.
Some Positive Facts
It's a pretty miserable picture
as it is painted in Washington.
| Joaquin M. Elizalde, Philippine
Ambassador to the United States,
makes no attempt to gloss over the
facts of the Philippines perilous
position. but he insists that coun-
terbalancing factors must also be
weighed.
1T Is true" he said, "that the
Philippines are confronted now
with some difficulties. Certain
mistakes have been made and
certain deficiencies exist which
we will correct. But what we
must remember is the positive
side of the Philippine achieve
ment since the war, and the fact
that while we may have fallen
short in some respects we have
gone far in others. The picture
is nowhere nearly as black as it
has been painted"
The United States fits into the
Philippine picture as the chief
source of power for defense of the
islands in case of Red aggression.
BY the same token, the Philip
pines are one of our main defen-
sive outposts in holding Southeast
Asia against Communist DOM
ination.
What can be done to correct
. the ills which beset the islands?
The job, it is conceded on all
sides, falls chiefly on the Filipinos.
Leadership for the tightening
; process must come from the top.
Since Mr.. Quirino is President
and barring any unexpected
change will remain so for three
years-it must come from him.
II he hesitates. the pressure of
events may force him to act.
Quirino Must Lead
| Mr.. Quirino, it is argued by
those sympathetic to the Philip
pine people. must purge those
officials who are responsible for
; corruption and for the failure to
collect taxes. There must be q
stimulation of eXportable COM