But other causes of backwardness are traceable to those very elements of wealth and prosperity, to which these islands must look for their future progress. A soil so feracious, a sun so bright, rains so bountiful, require so little co-operation from the aid of man that he becomes careless, indolent, unconcerned for the morrow. He has but to stretch out his hand, and food drops into it. The fibre of the aloe, which the female weaves with the simplest of looms, gives her garments; the uprights and the floors and the substantial parts of his dwelling are made of the bamboo, which he finds in superfluous abundance; while the nipa palm provides roofs and sides to his hut. Wants he has few and he cares little for luxuries. His enjoyments are in religious processions, in music and dancing, in his gallo above all. He may take possession without rent of any quantity of land which he is willing to cultivate. There is a tendency, no doubt, to improvement. Cultivation extends and good examples are not without effect.
In times of tranquillity Spain has nothing to fear for her Philippine colonies. So long as they are unmolested by foreign invaders and the government is carried on with mildness and prudence, there is little to be apprehended from any internal agitation; but I doubt the efficiency of any means of defence at the disposal of the authorities, should a day of trouble come. The Indian regular forces might for some time be depended on; but whether this could be anticipated of the militia or any of the urban auxiliaries is uncertain. The number of Spaniards is small – in most of the islands quite insignificant; indolence and indifference characterize the indigenous races; and if, on the one hand, they took no part in favour of intrusive strangers, on the other, they could not be looked to for any patriotic or energetic exertions on behalf of their Spanish rulers. They have, indeed, no traditions of former independence – no descendants of famous ancient chiefs or princes, to whom they look with affection, hope or reverence. There are no fragments left of hierarchies overthrown. No Montezumas, no Colocolos, are named in their songs, or perpetuated in their memories. There are no ruins of great cities or temples; in a word, no records of the remote past. There is a certain amount of dissatisfaction among the Indians, but it is more strongly felt against the native gobernadorcillos – the heads of barangay – the privileged members of the local principalia – when exercising their “petty tyrannies,” than against the higher authorities, who are beyond the hearing of their complaints. “The governor-general is in Manila (far away); the king is in Spain (farther still); and God is in heaven (farthest of all).” It is a natural complaint that the tribute or capitation tax presses equally on all classes of Indians, rich or poor. The heads of barangay, who are charged with its collection, not unfrequently dissipate the money in gambling. One abuse has, however, been reformed – the tribute in many provinces was formerly collected in produce, and great were the consequent exactions practised upon the natives, from which the treasury obtained no profit, but the petty functionaries much. I believe the tax is now almost universally levied in money. All Spaniards, all foreigners (excepting Chinese), and their descendants are exempted from tribute. One of the most intelligent of the merchants of Manila (Don Juan Bautista Marcaida) has had the kindness to furnish me with sundry memoranda on the subject of the capabilities of the Philippine Islands, and the means of developing them. To his observations, the result of careful observation, much experience and extensive reading, I attach great value. They are imbued with some of the national prejudices of a Spanish Catholic, in whose mind the constitution of the Romish Church is associated with every form of authority, and who is unwilling to see in that very constitution, and its necessary agencies, invincible impediments to the fullest progress of intellect – to the widest extension of agricultural, manufacturing and commercial prosperity – in a word, to that great agitation of the popular mind, to which Protestant nations owe their religious reforms, and their undoubted superiority in the vast field of speculation and adventure.
He says: – “The social organization of the Philippines is the most paternal and civilizing of any known in the world; having for its basis the doctrines of the Gospel, and the kind and fatherly spirit of the Laws of the Indies.” It may be admitted, in reference to the legislation of the colonies of many nations, that the Spanish code is comparatively humane and that the influence of the Romish clergy has been frequently and successfully excited for the protection and benefit of conquered natives, and of imported slaves; but M. Marcaida goes on to acknowledge and point out “the torpid and unimproving character of the existing system,” and to demand important changes for the advancement of the public weal.
“The government moves slowly, from its complicated organization, and from the want of adequate powers to give effect to those reforms which are suggested by local knowledge, but which are overruled by the unteachable ignorance, or selfish interests, or political intrigues of the mother country.”
As regards the clergy, he thinks the administration generally good, but that the progress of time and altered circumstances necessitate many important changes in the distribution of the ecclesiastical authority, a new arrangement of the pueblos, a better education of the church functionaries, a great augmentation of the number of parochial priests (many of whom have now cures varying from 3,000 to 60,000 souls). He would have the parish clergyman both the religious and secular instructor of his community, and for this purpose requires that he should be becomingly and highly educated – a consummation for which the government would have some difficulty in providing the machinery, and for which assuredly the Church would not lend its co-operation.
“For the administration of justice, the Philippines have one supreme and forty-two subordinate tribunals. The number is wholly insufficient for the necessities of 5,000,000 of inhabitants scattered over 1,200 islands, and occupying so vast a territorial space.” There can be no doubt that justice is often inaccessible, that it is costly, that it is delayed, defeated, and associated with many vexations. Spain has never been celebrated for the integrity of its judges, or the purity of its courts. A pleyto in the Peninsula is held to be as great a curse as a suit in Chancery in England, with the added evil of want of confidence in the administrators of the law. Their character would hardly be improved at a distance of 10,000 miles from the Peninsula; and if Spain has some difficulty in supplying herself at home with incorruptible functionaries, that difficulty would be augmented in her remotest possessions. There seemed to me much admirable machinery in the traditional and still existing usages and institutions of the natives. Much might, no doubt, be done to lessen the dilatory, costly and troublesome character of lawsuits, by introducing more of natural and less of technical proceedings; by facilitating the production and examination of evidence; by the suppression of the masses of papel sellado (documents upon stamped paper); by diminishing the cost and simplifying the process of appeal; and, above all, by the introduction of a code applicable to the ordinary circumstances of social life.
He thinks the attempts to conglomerate the population in towns and cities injurious to the agricultural interests of the country; but assuredly this agglomeration is friendly to civilization, good government and the production of wealth, and more likely than the dispersion of the inhabitants to provide for the introduction of those larger farms to which the Philippines must look for any very considerable augmentation of the produce of the land.
“The natural riches of the country are incalculable. There are immense tracts of the most feracious soil; brooks, streams, rivers, lakes, on all sides; mountains of minerals, metals, marbles in vast variety; forests whose woods are adapted to all the ordinary purposes of life; gums, roots, medicinals, dyes, fruits in great variety. In many of the islands the cost of a sufficiency of food for a family of five is only a cuarto, a little more than a farthing, a day. Some of the edible roots grow to an enormous size, weighing from 50 to 70 lbs.: – gutta-percha, caoutchouc, gum-lac, gamboge, and many other gums abound. Of fibres the number is boundless; in fact, the known and the unknown wealth of the islands only requires fit aptitudes for its enormous development.
“With a few legislative reforms,” he concludes, “with improved instruction of the clergy, the islands would become a paradise of inexhaustible riches, and of a well-being approachable in no other portion of the globe. The docility and intelligence of the natives, their imitative virtues (wanting though they be in forethought), make them incomparably superior to any Asiatic or African race subjected to European authority. Where deep thought and calculation are required, they will fail; but their natural dispositions and tendencies, and the present state of civilization among them, give every hope and encouragement for the future.”31
CHAPTER XXI
FINANCE, TAXATION, ETC
The gross revenues of the Philippines are about 10,000,000 dollars. The budget for 1859 is as follows: —
Thus about one-tenth of the gross revenue is received by the mother country in the following shapes: – Salaries of Spanish consuls in the East, 22,500 dollars; remittances to Spain and bills drawn by Spain, 680,600 dollars; tobacco and freights, 168,750 dollars; credits to French government for advances to the imperial navy, 140,000 dollars.
Of the direct taxes, 68,026·77 dollars are paid as tribute by the unconverted natives, 114,604·50 dollars by the mestizos (half-races), 136,208·78 dollars by the Chinese, and 1,609,757·87 dollars by the Indians (or tribes professing Christianity).
The produce of the customs is so small, and the expenses of collection so great – the cost of the coast and inland preventive service alone being 265,271·99 dollars; general and provincial administrations, between 70,000 and 80,000 dollars – that I am persuaded it would be a sound, wise and profitable policy to abandon this source of taxation altogether, and to declare all the ports of the Philippines free.
I have also come to the conclusion that the monopolies, which give a gross revenue to the treasury of more than 7,000,000 dollars, are, independently of their vicious and retardatory action upon the public weal, far less productive than taxation upon the same articles might be made by their emancipation from the bonds of monopoly. I leave here out of sight the enormous amount of fraud and crime, and the pernicious effects upon the public morals of a universal toleration of smuggling, as well as the consideration of all the vexations, delays, checks upon improvement, corruption of officials and the thousand inconveniences of fiscal interference at every stage and step; and only look at the acknowledged cost of the machinery – it amounts to about 5,000,000 dollars – so that the net produce to the State scarcely exceeds 2,000,000 dollars.
The whole receipt from the tobacco monopoly is 5,097,795 dollars. The expenses for which this department is debited are (independently of the proportion of the general charges of administration) —
So that the net rendering of this most valuable production is only 1,886,042·14 dollars, or 37 per cent. upon the gross amount, 63 per cent. being expended on the production of the tobacco and manufacture of the cigars. I am of opinion that from 4,000,000 to 5,000,000 dollars might be realized with immense benefit to the public by a tax upon cultivation, or the imposition of a simple export duty, or by a union of both. Production would thus be largely extended, prices moderated to the consumer and the net revenue probably more than doubled.
From the produce of the lottery, 253,500 dollars, there have to be deducted – expenses of administration, 4,472 dollars; prizes paid, 195,000 dollars; prizes not claimed, 1,000 dollars; commission on sales of tickets, 4,680 dollars; making in all, 205,152 dollars; so that this fertile source of misery, disappointment, and frequently of crime, does not produce a net income of 50,000 dollars to the State. It may well be doubted if such a source of revenue should be maintained. The revenue derived from cock-fights, 86,326·25 dollars, is to some extent subject to the same condemnation, as gambling is the foundation of both, but in the case of the galleras the produce is paid without deduction into the treasury.
In the Bisayas palm wine has been lately made the object of a State monopoly which produces 324,362 dollars, but is very vexatious in its operation and much complained of by the Indians. The tax on spirituous liquors gives 1,465,638 dollars. The opium monopoly brings 44,333·34 dollars; that of gunpowder, 21,406 dollars. Of smaller sources of income the most remarkable are – Papal bulls, giving 58,000 dollars; stamps, 39,600 dollars; fines, 30,550 dollars; post-office stamps, 19,490 dollars; fishery in Manila harbour, 6,500 dollars.
It is remarkable that there are no receipts from the sale or rental of lands. Public works, roads and bridges are in charge of the locality, while of the whole gross revenue more than seven-tenths are the produce of monopolies.
Of the government expenditure, under the head of Grace and Justice, the clergy receive 488,329·28 dollars, and for pious works 39,801·83; Jesuit missions to Mindanao, 25,000. The cost of the Audiencia is 65,556; of the alcaldes and gobernadores, 53,332 dollars.
In the war department the cost of the staff is 154,148·80 dollars; of the infantry, 857,031·17 dollars; cavalry, 52,901·73 dollars; artillery, 192,408·71 dollars; engineers, 32,173 dollars; rations, 140,644·31 dollars; matériel, 149,727·10 dollars; transport, 112,000 dollars; special services, 216,673·89 dollars. In the finance expenses the sum of 310,615·75 dollars appears as pensions.
The personnel of the marine department is 235,671·82 dollars; cost of building, repairing, &c., 266,813·17 dollars; salaries, &c., are 155,294·98 dollars; rations, 190,740·84 dollars.
The governor-general receives, including the secretariat, 31,056 dollars; expenses, 2,500 dollars. The heaviest charge in the section of civil services is 120,000 dollars for the mail steamers between Hong Kong and Manila, and 35,000 dollars for the service between Spain and Hong Kong. There is an additional charge for the post-office of 6,852 dollars. The only receipt reported on this account is for post-office stamps, 19,490 dollars.
I have made no reference to the minor details of the incomings and outgoings of Philippine finance. The mother country has little cause to complain, receiving as she does a net revenue of about 5s. per head from the Indian population. In fact, about half of the whole amount of direct taxation goes to Spain, independently of what Spanish subjects receive who are employed in the public service. The Philippines happily have no debt, and, considering that the Indian pays nothing for his lands, it cannot be said that he is heavily taxed. But that the revenues are susceptible of immense development – that production, agricultural and manufactured, is in a backward and unsatisfactory state – that trade and shipping might be enormously increased – and that great changes might be most beneficially introduced into many branches of administration, must be obvious to the political economist and the shrewd observer. The best evidence I can give of a grateful remembrance of the kindnesses I received will be the frank expression of opinions friendly to the progress and prosperity of these fertile and improveable regions. Meliorations many and great have already made their way; it suffices to look back upon the state of the Philippines, “cramped, cabined and confined” as they were, and to compare them with their present half-emancipated condition. No doubt Spain has much to learn at home before she can be expected to communicate commercial and political wisdom to her dependencies abroad. But she may be animated by the experience she has had, and at last discover that intercourse with opulent nations tends not to impoverish, but to enrich those who encourage and extend that intercourse.
CHAPTER XXII
TAXES
Down to the year 1784 so unproductive were the Philippines to the Spanish revenues, that the treasury deficit was supplied by an annual grant of 250,000 dollars provided by the Mexican government. A capitation tax was irregularly collected from the natives; also a custom-house duty (almojarifango) on the small trade which existed, and an excise (alcabala) on interior sales. Even to the beginning of the present century the Spanish American colonies furnished the funds for the military expenses of Manila. In 1829 the treasury became an independent branch of administration. Increase of tribute-paying population, the tobacco and wine monopoly, permission given to foreigners to establish themselves as merchants in the capital, demand for native and consumption of foreign productions, and a general tendency towards a more liberal policy, brought about their usual beneficial results; and, though slowly moving, the Philippines have entered upon a career of prosperity susceptible of an enormous extension.
The capitation tax, or tribute paid by the natives, is the foundation of the financial system in the Philippines. It is the only direct tax (except for special cases), makes no distinction of persons and property, has the merit of antiquity, and is collected by a machinery provided by the Indians themselves. Originally it was levied in produce, but compounded for by the payment of a dollar (eight reales), raised afterwards to a dollar and a quarter, and finally the friars have managed to add to the amount an additional fifty per cent., of which four-fifths are for church, and one-fifth for commercial purposes.
The tribute is now due for every grown-up individual of a family, up to the age of sixty; the local authorities (cabezas de barangay), their wives and eldest or an adopted son, excepted. A cabeza is charged with the collection of the tribute of his cabaceria, consisting generally of about fifty persons. There are many other exceptions, such as discharged soldiers and persons claiming exemptions on particular grounds, to say nothing of the uncertain collections from Indians not congregated in towns or villages, and the certain non-collections from the wilder races. Buzeta estimates that only five per cent. of the whole population pay the tribute. Beyond the concentrated groups of natives there is little control; nor is the most extended of existing influences – the ecclesiastical – at all disposed to aid the revenue collector at the price of public discontent, especially if the claims of the convent are recognized and the wants of the church sufficiently provided for, which they seldom fail to be. The friar frequently stands between the fiscal authority and the Indian debtor, and, as his great object is to be popular with his flock, he, when his own expectations are satisfied, is naturally a feeble supporter of the tax collector. The friar has a large direct interest in the money tribute, both in the sanctorum and the tithe; but the Indian has many means of conciliating the padre and does not fail to employ them, and the padre’s influence is not only predominant, but it is perpetually present, and in constant activity. There is a decree of 1835 allowing the Indians to pay tribute in kind, but at rates so miserably low that I believe there is now scarcely an instance of other than metallic payments. The present amount levied is understood to be —
Which at 4s. 6d. per dollar makes a capitation tax of about 8s. 6d. per head.
The Sangleys (mestizos of Chinese origin) pay 20 rials government tribute, or 25 rials in all, being about 14s. sterling.
There are some special levies for local objects, but they are not heavy in amount.
The Chinese have been particularly selected to be the victims of the tax-gatherer, and, considering the general lightness of taxation, and that the Chinese had been invited to the Philippines with every assurance of protection, and as a most important element for the development of the resources of the country, the decree of 1828 will appear tolerably exacting. It divides Chinese settlers into three classes: —
Not consenting to this, and if unmarried, they might quit the country in six months, or pay the value of their tribute in labour, and they were, after a delay of three months in the payment of the tax, to be fineable at 2 rials a day. At the time of issuing the decree there were 5,708 Chinese in the capital, of whom immediately 800 left for China, 1,083 fled to the mountains and were kindly received and protected by the natives, 453 were condemned to the public works, and the rest left in such a condition of discontent and misery that in 1831 the intendente made a strong representation to the government in their favour, and in 1834 authority was given to modify the whole fiscal legislation as regarded the Chinese.
The Chinese, on landing in Manila, whether as sailors or intending settlers, are compelled to inhabit a public establishment called the Alcaiceria de San Fernando, for which payment is exacted, and there is a revenue resulting to the State from the profits thereof.