The concrete objectives should include both the definite relief of the United States from any degree of responsibility to the holders of obligations of the public debt of the government of the Philippine Islands and the presentation of satisfactory evidence that an independent Philippine government would be able to meet the necessary costs of government under the conditions which an independent status would presumably entail.

Now, I think that that is rather a fair statement. What I am trying to say to you is that I am trying to build the Filipinos into a nation, and that your bill would prevent, in my opinion, the possibility of their ever becoming one.

I will now devote myself to that phase of it a little while.

Senator HAWES. But before you get away from the element of time, Mr. Secretary, it is quite clear, then, from your statement, that you are opposed to setting a definite date, either soon or late, for the termination of our relationship with the Philippines; is that correct?

Secretary HURLEY. Yes, sir. I am in favor of setting conditions to be accomplished, and they are not unreasonable. They can be accomplished by following the policy that the United States has followed over the term of our occupation of the islands.

The following instruction to the House conferees was adopted by a vote of 203 to 154 in the House on this question of time. This was when the Organic Act was passed, and when this same fight to put in a time limit took place. This is what the House that adopted the Jones bill decided upon the matter:

That the managers on the part of the House are instructed not to agree to any declaration or provision setting a definite time, or fixing a definite period, at or within which the Philippines shall be granted independence.

That is from page 8184, Congressional Record, May 1, 1916, when the legislation which resulted in the passage of the organic act was under consideration.

Now have I made definite my attitude?
Senator HAWES. Yes.

Senator VANDENBERG. Mr. Secretary, before you leave the question of time and objective, may I ask you this question? You are familiar, of course, with the terms of the measure that I have introduced covering this subject. May I ask you whether the element both of time and objective is not approximate at least in the permissive schedule which is included in that measure? Secretary HURLEY. Of course. Those two elements are in your bill. And I might say this to the Senator. I have prepared, and I have not had time to go over it since General Parker worked on it last night, a complete criticism of your bill. I might say this, though, so that the committee and the Filipino delegation present may understand my attitude on your bill. Your bill has some very splendid objectives stated. It all depends upon whether we agree to your approach to those objectives.

For instance, your bill provides that a tariff be placed on Filipino goods coming into the United States-that a very small percentage of the tariff be placed in the first year of the operation of the bill. That, thereafter, the Philippine Legislature shall have the right to impose additional increments of the United States tariff until that entire tariff is imposed. By that provision, you put in the hands of the Philippine Legislature the right to impose their own percentages

of our tariff, rather than have us prescribe how they shall be imposed, and when.

Is that a fair statement of it?

Senator VANDENBERG. Yes; I think so. And is that not an element of self-government in the developing of responsibility in the situation? Secretary HURLEY. It is an element of self-government, and it is a desirable thing, in that it places on the Filipino people the responsibility of choking their own market and destroying their own economic welfare.

Senator VANDENBERG. If that is the result.

Secretary HURLEY. If that is the result. And in my opinion it would be. And I think that the Filipino delegation are of the same opinion on that. However, I do not want to dispute the merits of your bill. It relieves us from acting for the Filipinos and permits them to act for themselves.

Senator VANDENBERG. Well, that is a step in advance.

Secretary HURLEY. That is a step in advance. And of course that is a feature of your bill.

Now I believe I am speaking correctly when I say that the Filipino delegation is, however, opposed to that on this ground: That, in place of an immediate strangulation of the economic condition, an immediate breaking down of what has been built up, it does it by slow processes and prolongs the agony. The Filipino people believe and understand, I do not agree with them-that they can, by breaking down the present situation quickly, recover more quickly than they could do under the terms of your bill.

Senator VANDENBERG. What I am getting at, without going into the details, is this. You have dismissed completely the possibility of joining time and objectives?

Secretary HURLEY. Yes, sir.

Senator VANDENBERG. In the ultimate determination?

Secretary HURLEY. Yes, sir.

Senator VANDENBERG. I am asking you whether the theory of this bill that I have introduced does not offer the possibility of joining time and objectives?

Secretary HURLEY. It does. Is that all you wanted?

Senator VANDENBERG. Yes.

Senator HAWES. Mr. Secretary, while you are on that subject, which do you think would be more advisable, a limitation of imports or a tariff scale?

Secretary HURLEY. Well, you were present when I discussed that yesterday, but for the benefit of the committee I will say this, that the thing to be desired for the continuing stability of the Philippine government is balanced trade reciprocity. As it is now, the trade is, of course, in their favor, and they are favored in the United States market to a great extent.

The rational objective would be, first-and understand, this is a suggestion that I received from Filipinos-a limitation brought about in some way, of the importation of sugar. Second, after that limitation has become effective without the destruction of any of their present sugar centrals, then a tariff by the Philippine Legislature on

the importation to the Philippine Islands of foreign goods that compete with our condensed milk, our cotton goods, and other articles from America which find a market there.

In working out that reciprocal theory, you may find that eventually it will be conducive to the best interests of both countries to have some tariff even on the sugar that we are now exempting from any duty. In other words, the question is one that we should determine with our minds rather than with our emotions. It is an economic question, to which we should address ourselves calmly and try to work out something that would be balanced, that would be free from the criticism. directed to the present situation. That criticism is that the Filipinos have all the best of it as regards favored markets. That is why our farm industries and our sugar growers and others are objecting to the continuance of Philippine-American free trade, because the benefits therefrom are unbalanced.

If we could direct ourselves to that problem so that we could reasonably balance the benefits, we would save the Philippine economic structure and at the same time not injure but help the market for our own farm products. There is a reasonable ground for believing that this can be done. And I hope that the time will come when, in place of fighting out a political question, the final solution of which may well be postponed, attention may be centered upon the fundamental economic necessities of the situation-that a Filipino economic council and an American economic council will meet and apply their combined experience, training and talents to the solution of the situation. A solution can be worked out which will injure neither the people of the United States nor the Filipinos, but will help to sustain that which we have created in the Philippine Islands.

Senator HAWES. But choosing between the two theories, Mr. Secretary, one of the limitation theory and the other the graduated tariff theory, which do you think is the more advisable?

Secretary HURLEY. Senator, I have not covered that in my statement here, but I will answer it for you. I believe that the limitation theory is absolutely necessary in the present posture of affairs, and the limitation could be placed so that it will not injure the Filipinos, but will remove the fear in the mind of America that the Philippines may become a sugar-producing state and flood this market. I believe that a limitation is essential to the solving of the present problem.

Now the limitation would work two ways. First it, removes the fear in America that we are going to be flooded with Filipino sugar. Second, it compels a diversification of crops in the Philippine Islands. Both results would be helpful to the relationship between the two peoples.

The CHAIRMAN. Mr. Secretary, will you put in the record, unless you are able to answer it now-will you put in the record later the figures regarding the imports of Philippine sugar during the past, let us say, 10 years, up to the very latest figures?

Secretary HURLEY. I have them here and I can put them in right here. I do not think you want me to read them, do you?

The CHAIRMAN. The reason I am interested in it, is that I have been told within the last day or so, that the views expressed at the time we passed the tariff bill two years ago that there will be no

increase in Philippine sugar, are not justified, and that there has been a very great increase within the past three years. Is that true?

Secretary HURLEY. There has been an increase in the past three years. I will say to the Senator that we will put the figures in right here. But let me pursue that question just a little further. In the development of sugar in the Philippine Islands there has been undertaken the construction of additional centrals. There has also been undertaken the cultivation of some additional land.

The CHAIRMAN. Not within the last five years, has there?

Secretary HURLEY. Yes. There is now such a situation that, considering the additional centrals and the improved quality of the crops brought about by different kinds of cane and other conditions there must unquestionably, in my opinion-now understand, I have heard all the experts on this testify the other way-there must unquestionably be an increase. Even if the Filipinos would not do anything more than operate to full capacity the sugar works they now have started, there is bound to be some increase in the sugar production of the Philippine Islands.

Is that right, Mr. Speaker.

Speaker ROXAS. Yes, Mr. Senator. Just to correct the record. The chairman said that during the hearings on the tariff bill we guaranteed that there would be no increase in sugar production.

The CHAIRMAN. No; I did not state that anybody guaranteed anything, but that the opinion was expressed that there would not be any great increase in production.

Speaker ROXAS. The opinion then expressed was that whatever increase there would be in the sugar production would come not from additional acreage devoted to cane cultivation, but from greater efficiency in production of cane and in the manufacture of sugar through the introduction of new varieties.

The CHAIRMAN. New varieties; yes.
What are the figures, Mr. Secretary?

Secretary HURLEY. I have the figures here from 1899.

The CHAIRMAN. Will you read them only for the last three or four years?

Secretary HURLEY. These are in kilos; 569,237,628 kilos for 1928. 1929 now understand, the first one was five hundred and odd millions. This is 695,868,138 kilos for 1929.

In 1930 there were 743,979,730 kilos.

That shows a ratio of advance in the second year over the first of about 20 per cent. It averages over 10 per cent a year for the last three years.

Senator BROUSSARD. Mr. Chairman, I have from the Bureau of Customs the quantity of sugar produced in long tons in the Philippine Islands.

The CHAIRMAN. Will you read that, Senator?
Senator BROUSSARD. Yes; I would like to.

five years? In 1926 it was 339,674.

The CHAIRMAN. Tons?

Do you want the last

Senator BROUSSARD. Long tons. In 1927 it was 473,764 tons; in 1928 it was 513,407 tons; in 1929 it was 634,578 tons; in 1930 it was 708,686 tons.

Those were the imports from the Philippines to this country.
The CHAIRMAN. That does not include 1931?

Senator BROUSSARD. No. There are no statistics finally compiled as of 1931. That is one of the reasons why I do not like this average of 20 per cent, or something, because there would be a period of uncertainty where they would not know how much sugar was shipped in.

The CHAIRMAN. Has the Senator any information, informal or otherwise, as to the amount imported last year, 1931?

Senator BROUSSARD. No. This was made out on February the 8th by the bureau.

The CHAIRMAN. General Parker?

General PARKER. There was some further increase last year. The complete figures are not in.

(NOTE. The figures for 1931 were received by the Bureau of Insular Affairs before this testimony was printed and appear in the tabulation of sugar imports hereinafter included.)

Secretary HURLEY. And sugar was the only profitable crop last year, as I understand it.

General PARKER. Copra and hemp were both unprofitable last year.

Secretary HURLEY. That still means that sugar was the only profitable crop last year.

United States imports of duty-free cane sugar from the Philippines, July 1, 1909– December 31, 1930 1

[Compiled in the Bureau of Insular Affairs, War Department]