Philippines - Economic and Social Developments

Economic and social developments

The Taft Commission, appointed in 1900, viewed economic development, along with education and the establishment of representative institutions, as one of the three pillars of the United States program of tutelage. Its members had ambitious plans to build railroads and highways, improve harbor facilities, open greater markets for Philippine goods through the lowering or elimination of tariffs, and stimulate foreign investment in mining, forestry, and cash-crop cultivation. In 1901 some 93 percent of the islands' total land area was public land, and it was hoped that a portion of this area could be sold to American investors. Those plans were frustrated, however, by powerful agricultural interests in the United States Congress who feared competition from Philippine sugar, coconut oil, tobacco, and other exports. Although Taft argued for more liberal terms, the United States Congress, in the 1902 Land Act, set a limit of 16 hectares of Philippine public land to be sold or leased to American individuals and 1,024 hectares to American corporations. This act and tight financial markets in the United States discouraged the development of large-scale, foreign-owned plantations such as were being established in British Malaya, the Dutch East Indies, and French Indochina.

The Taft Commission argued that tariff relief was essential if the islands were to be developed. In August 1909, Congress passed the Payne Aldrich Tariff Act, which provided for free entry to the United States of all Philippine products except rice, sugar, and tobacco. Rice imports were subjected to regular tariffs, and quotas were established for sugar and tobacco. In 1913 the Underwood Tariff Act removed all restrictions. The principal result of these acts was to make the islands increasingly dependent on American markets; between 1914 and 1920, the portion of Philippine exports going to the United States rose from 50 to 70 percent. By 1939 it had reached 85 percent, and 65 percent of imports came from the United States.

In 1931 there were between 80,000 and 100,000 Chinese in the islands active in the local economy; many of them had arrived after United States rule had been established. Some 16,000 Japanese were concentrated largely in the Mindanao province of Davao (the incorporated city of Davao was labeled by local boosters the "Little Tokyo of the South") and were predominant in the abaca industry. Yet the immigration of foreign laborers never reached a volume sufficient to threaten indigenous control of the economy or the traditional social structure as it did in British Malaya and Burma.

Resistance Movements

The tradition of rural revolt, often with messianic overtones, continued under United States rule. Colorum sects, derived from the old Cofrad�a de San Jos�, had spread throughout the Christian regions of the archipelago and by the early 1920s competed with the Roman Catholic establishment and the missionaries of Gregorio Aglipay's Independent Philippine Church (Iglesia Filipina Independiente). A colorum-led revolt broke out in northeastern Mindanao early in 1924, sparked by a sect leader's predictions of an imminent judgment day. In 1925 Florencio Entrencherado, a shopkeeper on the island of Panay, proclaimed himself Florencio I, Emperor of the Philippines, somewhat paradoxically running for the office of provincial governor of Iloilo that same year on a platform of tax reduction, measures against Chinese and Japanese merchants, and immediate independence. Although he lost the election, the campaign made him a prominent figure in the western Visayan Islands and won him the sympathies of the poor living in the sugar provinces of Panay and Negros. Claiming semidivine attributes (that he could control the elements and that his charisma had been granted him by the Holy Spirit and the spirits of Father Burgos and Rizal), Florencio had a following of some 10,000 peasants on Negros and Panay by late 1926. In May 1927, his supporters, heeding his call that "the hour will come when the poor will be ordered to kill all the rich," launched an abortive insurrection.

Tensions were highest in Central Luzon, where tenancy was most widespread and population pressures were the greatest. The 1931 Tayug insurrection north of Manila was connected with a colorum sect and had religious overtones, but traditionally messianic movements gradually gave way to secular, and at times revolutionary, ones. One of the first of these movements was the Association of the Worthy Kabola (Kapisanan Makabola Makasinag), a secret society that by 1925 had some 12,000 followers, largely in Nueva Ecija Province. Its leader, Pedro Kabola, called for liberation of the Philippines and promised the aid of the Japanese. The Tangulang (Kapatiran Tangulang Malayang Mamamayang--Association for an Offensive for Our Future Freedom) movement founded in 1931 was both urban and rural based and had as many as 40,000 followers.

The most important movement, however, was that of the Sakdalistas. Founded in 1933 by Benigno Ramos, a former Nacionalista Party member and associate of Quezon who broke with him over the issue of collaboration, the Sakdal Party (sakdal means to accuse) ran candidates in the 1934 election on a platform of complete independence by the end of 1935, redistribution of land, and an end to caciquism. Sakdalistas were elected to a number of seats in the legislature and to provincial posts, and by early 1935 the party may have had as many as 200,000 members. Because of poor harvests and frustrations with the government's lack of response to peasant demands, Sakdalistas took up arms and seized government buildings in a number of locations on May 2-3, 1935. The insurrection, suppressed by the Philippine Constabulary, resulted in approximately 100 dead and Benigno Ramos fled into exile to Japan.

Through the 1930s, tenant movements in Central Luzon became more active, articulate, and better organized. In 1938 the Socialist Party joined in a united front with the Communist Party of the Philippines (Partido Komunista ng Pilipinas--PKP), which was prominent in supporting the demands of tenants for better contracts and working conditions. As the depression wore on and prices for cash crops collapsed, tenant strikes and violent confrontations with landlords, their overseers, and the Philippine Constabulary escalated.

In response to deteriorating conditions, commonwealth president Quezon launched the "Social Justice" program, which included regulation of rents but achieved only meager results. There were insufficient funds to carry out the program, and implementation was sabotaged on the local level by landlords and municipal officials. In 1939 and 1940, thousands of cultivators were evicted by landlords because they insisted on enforcement of the 1933 Rice Share Tenancy Act, which guaranteed larger shares for tenants.

The Tenancy Problem

The limited nature of United States intervention in the economy and the Nacionalista Party's elite dominance of the Philippine political system ensured that the status quo in landlord and tenant relationships would be maintained, even if certain of its traditional aspects changed. A government attempt to establish homesteads modeled on those of the American West in 1903 did little to alter landholding arrangements. Although different regions of the archipelago had their own specific arrangements and different proportions of tenants and small proprietors, the kasama (sharecropper) system, was the most prevalent, particularly in the rice-growing areas of Central Luzon and the Visayan Islands.

Under this arrangement, the landowners supplied the seed and cash necessary to tide cultivators over during the planting season, whereas the cultivators provided tools and work animals and were responsible for one-half the expense of crop production. Usually, owner and sharecropper each took one-half of the harvest, although only after the former deducted a portion for expenses. Terms might be more liberal in frontier areas where owners needed to attract cultivators to clear the land. Sometimes land tenancy arrangements were three tiered. An original owner would lease land to an inquilino, who would then sublet it to kasamas. In the words of historian David R. Sturtevant: "Thrice removed from their proprietario, affected taos [peasants] received ever-diminishing shares from the picked-over remains of harvests."

Cultivators customarily were deep in debt, for they were dependent on advances made by the landowner or inquilino and had to pay steep interest rates. Principal and interest accumulated rapidly, becoming an impossible burden. It was estimated in 1924 that the average tenant family would have to labor uninterruptedly for 163 years to pay off debts and acquire title to the land they worked. The kasama system created a class of peons or serfs; children inherited the debts of their fathers, and over the generations families were tied in bondage to their estates. Contracts usually were unwritten, and landowners could change conditions to their own advantage.

Two factors led to a worsening of the cultivators' position. One was the rapid increase in the national population (from 7.6 million in 1905 to 16 million in 1939) brought about through improvements in public health, which put added pressure on the land, lowered the standard of living, and created a labor surplus. Closely tied to the population increase was the erosion of traditional patron-client ties. The landlord-tenant relationship was becoming more impersonal. The landlord's interest in the tenants' welfare was waning. Landlords ceased providing important services and used profits from the sale of cash crops to support their urban life-styles or to invest in other kinds of enterprises. Cultivators accused landowners of being shameless and forgetting the principle of utang na loob, demanding services from tenants without pay and giving nothing in return.

As the area under cultivation increased from 1.3 million hectares in 1903 to 4 million hectares in 1935--stimulated by United States demand for cash crops and by the growing population--tenancy also increased. In 1918 there were roughly 2 million farms, of which 1.5 million were operated by their owners; by 1939 these figures had declined to 1.6 million and 800,000, respectively, as individual proprietors became tenants or migrant laborers. Disparities in the distribution of wealth grew. By 1939 the wealthiest 10 percent of the population received 40 percent of the islands' income. The elite and the cultivators were separated culturally and geographically, as well as economically; as new urban centers rose, often with an Americanized culture, the elite left the countryside to become absentee landlords, leaving estate management in the hands of frequently abusive overseers. The Philippine Constabulary played a central role in suppressing antilandlord resistance.

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