about it) that the gross production of land frequently is equal for one year, or even greater, than the land itself sold in the market. Señor GUTIERREZ. No, sir. Archbishop GUIDI. Friar Martin is probably correct in this matter that Señor Gutierrez speaks about, of lands that are capable of producing 150 pesos a year; that there is a possibility that they have all the elements necessary to produce, if properly cultivated, 150 pesos a year, but that owing to certain conditions and circumstances, like lack of labor or isolated position, long way from a market, etc., they are unable to bring out their entire productivity, that is, to be cultivated to their fullest extent; and in that case such lands may be sold at less than what they are capable of producing in one year. But I do not believe that lands that actually do produce 150 pesos a year could be sold for anything less than that sum. To give a concrete example: There are certain lands around Rome that are cabable of great productivity, but they have gone begging in the market; nobody would buy that land on account of malarial fevers around there. Lately they have found a method of combatting these fevers and the price of these lands has gone up wonderfully. Formerly, of course, nobody would risk his life to go out and cultivate those lands, although it was known that the lands were capable of great production. Since they have discovered a way of defending themselves against the attacks of the mosquitos by living in mosquito-proof houses, the value of those lands around the Campana of Rome has gone up from 20 cents a square meter to 200 and 300 francs a hectare. That is simply owing to the different conditions surrounding them. Governor TAFT. I agree to what his excellency says, but I still wish to stick to the point that I am trying to make, and that is, that if you tell me that land is cultivated and produces $150 gross receipts a year, you only give me one circumstance in determining what the value of that land is, and that that may be so affected by other circumstances as to make the value of the land no more than the gross product in one year. Those are, first, the expenses-the cost of labor, the question of getting labor at all, the danger from locusts, the difficulty of getting carabaos, and a thousand and one circumstances, especially in the Tropics, that affect the net product from that gross product; and then, you add to that what is usually required as in the Tropics or in the community as a fair dividend or a fair percentage of income on your capital, which, I understand, in this community is from 20 to 30 per cent of the capital; so that it would be very easy to produce 150 pesos gross and then cut down the expenses and show that the net product was no more than would be the reasonable income on that land. Mr. MCGREGOR. That is a tremendous interest, governor. Governor TAFT. I can call every business man in Manila and show that he would not go into agriculture if he could not get at least 20 per cent. I mean invest capital and buy land. Mr. MCGREGOR. Because they are not people who care to do it. Archbishop GUIDI. But relatively the production of the land has also increased, that is, relatively with the expenses. As the circumstances have become more risky and as capital has become dearer, so the production of the land has increased in proportion, so that to-day the production of the land, we will say, that used to yield $150 is now very much greater. Relatively in proportion to the expenses it is just as great. For instance, palay is worth a great deal more now than it was before. The cultivator never loses; it is the consumer who pays for all that. The people who are obliged to go to market to buy rice for food have to pay for the losses of the landowner, but the landowner will always get his interest on his money. Governor TAFT. That is not my understanding, and I venture to say that if you go through the landowners of these islands you will find that none of them have made fortunes. Archbishop GUIDI. The only way you can gauge the value of the land is by the products. Governor TAFT. That is only one circumstance. Archbishop GUIDI. I think that is the principal circumstance. Governor TAFT. Let us see how much palay has come up in price. Ask Señor Villegas what the old price of palay was on the hacienda. Señor VILLEGAS. I have known, when I was a young man, rice to sell from 3 to 4 reals a cavan. It went to a dollar, from that it went to $2.20, from that it has gone up until it is now $3.50. Governor TAFT. When did it go to $2.20? Señor VILLEGAS. In 1901 and 1902. Archbishop GUIDI. Now I will ask, why has rice gone up? I will answer the question myself. It is because the landowner, the farmer, calculates what it has cost him to raise the rice. He calculates every penny that he has invested in the cultivation of this rice until he gets it into the warehouse and the market, and then on top of that he adds what he thinks a just interest on his capital, and he sells it at that price on the market, so that he loses nothing. Governor TAFT. I venture to differ totally from his excellency. He sells his rice for what he can get for it in the market, and that market is determined by what they can import rice for from Saigon and Bangkok and from other ports. It is determined by the demand and the supply. He does not make the calculation and it does not do any good to make the calculation, because he has got to sell the rice for what he can get for it. Archbishop GUIDI. We were speaking, however, of the price upon the land itself, for local consumption. Señor VILLEGAS. I was speaking of the market here in Manila. Governor TAFT. What is it on the hacienda? Señor VILLEGAS. In Paluan in 1901 I was able to purchase it a $1 a cavan. Governor TAFT. Is the carabao necessary for the cultivation of rice. Governor TAFT. What is the value of the carabao to-day in the market, anywhere, as compared with what it was three or four years ago? Señor VILLEGAS. Formerly you could get a carabao for from 30, 40, or 50, sometimes at the very dearest at 60, pesos a head, but to-day you can not buy a carabao in the market anywhere for less than 150. Governor TAFT. In other words, the price of carabaos has trebled? Señor VILLEGAS. Yes, sir, and even more. Governor TAFT. What is the "jornal" or daily wages in these provinces about Manila for farm laborers? Señor VILLEGAS. Fifty cents Mexican a day in the provinces. Formerly it was 25 cents. Governor TAFT. In some of the provinces has it not increased to 60 and 70 cents Mexican? Archbishop GUIDI. Perhaps 25 cents formerly was of greater value than 60 cents to-day. Governor TAFT. I am speaking only of Mexican, and that is the standard here. Archbishop GUIDI. But it is a great mistake that we have not yet gotten out of, in regard to the value of the Mexican money to-day and the Mexican money of former years. Governor TAFT. But we are dealing altogether with Mexican money to-day. The price of carabaos, the price of rice, and the price of the "jornal" is Mexican. Archbishop GUIDI. I agree with you. I know that in your mind you have the Mexican money, but Señor Villegas does not understand you, but he understands that the peso is the peso of Spain. Governor TAFT. They never had any money here but the Mexican peso. It was a dollar in silver with the Mexican stamp on it, and that may have varied in value and may have been worth in gold 100 cents at one time and 75 cents at another, and 50 cents at another, and 40 cents as it is to-day; but what I am speaking of is the value in Mexican, whatever that was worth in gold. That standard may have varied, but these people only knew the Mexican dollar; that is all they knew. That may have varied in gold, and the fact that it varied in gold may have increased the price in gold, but I am speaking of that standard, however varied that standard was. Archbishop GUIDI. The standard as applied in actual practice during this length of time works out in this way, that the article which was worth one Mexican dollar at that time is now worth two or three at the present time. Governor TAFT. As I conceive, what we have got to do in reaching the value of this property is to determine what that property is estimated to be worth by the people who are in a position to buy and in a position to work that land. It is by the demand, and the demand, as Señor Gutierrez says, is determined by the tenants who are around and who want the land. Now they who form the value and the demand have no other standard, whether it varies or not; they had no other standard except the silver Mexican dollar in the last twenty-five years. It is true, I have no doubt, that the fact that this Mexican dollar has gone down in gold has so affected values, unconsciously to these people, that the value of the land and the value of other things has increased in Mexican. The only way we can reach the value of these lands in gold is to determine their value in Mexican in the demand of those people who pay in Mexican and estimate in Mexican and then ourselves, because we go according to value in gold, reduce the Mexican value to a gold value according to the variation between gold and silver at the time that we make the purchase. Archbishop GUIDI. That means that the purchaser determines the price of the land. Governor TAFT. No; the seller also. Archbishop GUIDI. The great thing for us to find out is, if these people value $200 to-day in Mexican as its actual value to-day, or the $200 they have known it in times past, that is the difficulty. Governor TAFT. What we are discussing now, first, is the demand, and then the effect that the production in Mexican ought to have on the value and in demonstrating what that demand is. We have here the gross production in Mexican; we have the expenses in Mexican, to wit, we have the cost of the carabao, the cost of the seed, the cost of the labor, and the production, in Mexican, and we have also what is the understood income or per cent of income that is required by capitalists in the islands. That does not necessitate our going into gold at all, because we have every element in silver-silver as it is estimated by the people to-day. Archbishop GUIDI. My mind refuses to believe that a carabao can be worth as much to-day as a hectare of ground. Governor TAFT. But it is. I can get hectares of ground that are worth just a third of what the carabaos are worth. Señor GUTIERREZ. The price that Señor Villegas has placed on the carabao is about correct-150 to 200 pesos even; but this does not show that the land ought to be worth that. If the carabao is worth that much the land ought to be worth a good deal more. Governor TAFT. No; it is because the carabaos have disappeared; the land is still here. Señor GUTIERREZ. That is an accident. Governor TAFT. It is an accident that is bound to last for a number of years. Then you have surra that has already destroyed 50 per cent of the horses. (Adjourned until March 11, 1903.) Continued from March 9, 1903, fifth session. MALACAÑAN PALACE, Manila, March 11, 1903. Señor GUTIERREZ. I should like to know if Señor Villegas, upon making the survey of the Calamba estate and placing the value thereon, took into consideration the fact that there are coffee lands and hemp lands on the property? Señor VILLEGAS. I have seen no coffee lands on the property nor have I seen any abaca lands. There is a very small amount of hemp land. Señor GUTIERREZ. Señor Villegas also omits to take into account such important improvements in the hacienda of Calamba as the large dam and the smaller dams, 22 kilometers of ditching with new bridges, 2 kilometers of ditching of masonry, and a tubular siphon of iron, 24 meters long by 1 meter in diameter, which is placed at the bottom of the river and which is a very costly work of masonry. Neither has he taken into account three warehouses of masonry for the purification of the water, of 512 cubic meters capacity each, all of which is for irrigating the zone of cultivable land of said hacienda. Nor has he taken into account six machines with all their accessories, as well as other warehouses and sugar mills. All these improvements have cost over $400,000 gold. Señor VILLEGAS. I have taken into account, as will be shown in my estimate of the value of the property, all the small dams that there are on the property at the present time and have valued them in accordance with their present state of repair. Señor GUTIERREZ. So, as I understand you, you simply valued the smaller dams, but all the other irrigation improvements you have not taken into consideration, nor have you taken into consideration the warehouses and the mill on the property. Señor VILLEGAS. I did not take into consideration all of the other improvements in connection with the dams and ditching because I thought that they were merely accessories to the general irrigation works on the property, and as far as machinery is concerned I did not know but that it was private property, as the property is rented out to private tenants; and it must also be taken into account what kind of machinery you refer to. If it is milling machinery, then it does not belong to the hacienda and is not a part of the hacienda. Señor GUTIERREZ. In the valuation which I have the small dams do not appear, nor do the large dams, and as far as the machinery is concerned, that belongs to the property. There are seven machines on the property, all of them in warehouses. Señor VILLEGAS. According to the information I got from the presidente and the leading men of Calamba, I understood that all of that machinery and improvements were constructed by and were the property of the tenants. Señor GUTIERREZ. That is not true. All of the improvements on the hacienda belong to the hacienda and were made by the owners of the hacienda. Señor VILLEGAS. In the plan itself I have shown the portion which is legally acknowledged to be the property of the friars and shown the other which is not recognized as the property of the friars. Señor GUTIERREZ. Who has told you which was the part that belonged to the friars legally and which did not belong to the friars? Señor VILLEGAS. In making the survey of this land I have shown on the map that part which is legally recognized by the principales of Calamba as the legal property of the friars, and I have also designated that part of the land which the principales of Calamba say has been usurped by the friars. I have gone over and measured from monument to monument, taking in all of the monuments in that land; that is to say, the land which is legally recognized as belonging to the friars and that land which is said to have been usurped. Archbishop GUIDI. Have you seen the title deeds, or how did you determine which part of the land had been usurped and which part was that of the friars legally acknowledged? Señor VILLEGAS. I have not seen the title deeds to the lands, but I have simply, at the request of the principales and the presidente of Calamba, drawn this line out on the plan in order to show which land was legally recognized as the property of the iriars. Governor TAFT. What do the monuments consist of? Señor VILLEGAS. They are pillars of stone and masonry. Archbishop GUIDI. The only way to draw these boundaries is with the title deeds in your hands and then run the lines between the monuments. Governor TAFT. Were there any marks on this space that the presidente and councilors said was admitted to belong to the friars? Señor VILLEGAS. No, sir. Governor TAFT. Then you just made that from their statement, did you? Señor VILLEGAS. Yes, sir. Governor TAFT. Didn't they admit that the friars had been in possession of all this property? Señor VILLEGAS. Yes, sir; they acknowledged they have had and still have possession, but they say it was usurped by them. Governor TAFT. How long have they had possession, did they admit? Señor VILLEGAS. I believe that I myself was the bearer of a communication from the principales of Calamba to Señor Legarda with regard to this matter. Governor TAFT. What did that communication say? Señor VILLEGAS. The communication stated that from time to time these boundary monuments had been moved. Governor TAFT. Did it not appear by their admission that the friars had been in possession of this property from fifty to one hundred years? Señor VILLEGAS. I believe it is a long time. The communication states the time upon which the boundary monuments were moved. Archbishop GUIDI. It is a useless question. Governor TAFT. I want to get at actual possession, because actual possession in certain respects is better than the deed. Señor GUTIERREZ. Possession has been effective from 1830 to 1898. Governor TAFT. That was my understanding when I examined the heads of the religious orders. Perhaps I saw Andrews's Chain of Title, in which it appeared that this had been in possession of the friars for some eighty or one hundred years. Señor GUTIERREZ. Furthermore, Señor Villegas has given all that land over, in his estimates, to the friars. It is only now that he makes that remark with regard to the land being usurped. Governor TAFT. In justice to him, he has put in here this legend, this memorandum, as to the amount admitted legally to belong to the friars. Señor GUTIERREZ. I see that he has put down as our property 16,419 hectares. I do not know what the plan says. Governor TAFT. The truth is that he was not employed to look into the title at all. He was asked to go and survey and report on the classes of land and their values. He was asked to go to the haciendas, to whoever they belonged, it made no difference. Señor VILLEGAS. I have simply shown in the plan that part of the land which is acknowledged to be the legal property of the friars. Señor GUTIERREZ. Señor Villegas has valued the uncultivated lands of the hacienda at Calamba at 5 pesos a hectare. These lands contain very fine timber, both for building and for firewood; clay mines and chalk mines, of which a very fine quality of crockery has been made. Whereas in the hacienda of Pandi he has valued the uncultivated lands at $25 a hectare, and there is absolutely no comparison between the values of the two lands. In the first place, Calamba is nearer to the market and it is better situated in every way than Pandi. Therefore it is an absurd valuation that he has placed on the two lands. Señor VILLEGAS. There is no comparison between the soil of the uncultivated lands at Pandi and the uncultivated lands of the estate of Calamba. The former are gently sloping and have but a small growth of timber on them, which can be easily burned off, so that they are, at a very small expense, susceptible of cultivation; but the lands of the estate of Calamba are covered with a thick growth of timber and are very mountainous and broken, and it would be extremely expensive to cultivate them. Señor GUTIERREZ. The uncultivated lands at the Calamba estate not only have very valuable timber upon them, but also have an almost inexhaustible supply of firewood, which can be very easily gotten out. Its soil is a vegetable soil and it is very rich in comparison with that of Pandi. Pandi has a stony soil and is not rich at all. A portion of the uncultivated land at the Calamba estate is suitable for sugar culture; it is gently sloping, and very well suited for the cultivation of sugar. Señor VILLEGAS. In my opinion the soil at Pandi is very good for any sort of agriculture, but the soil at Calamba-that part of it which I have valued as uncultivated land-is very broken and it is only forest land. TESTIMONY OF GREGORIO CORCUERA. Governor TAFT. I would like to ask, in order to get through with this witness, which estates he surveyed? GREGORIO CORCUERA. Lolomboy and Santa Clara. Governor TAFT. I believe there is some difference between us as to the number of hectares in Lolomboy? Señor GUTIERREZ. There is a difference of 1,056 hectares. Governor TAFT. How did you reach the area of this hacienda? Señor CORCUERA. I used the system of making a complete survey around the hacienda, availing myself of the services of different guides. If I had had one efficient guide, perhaps I might have gotten closer to the actual area of the hacienda, but I was obliged to avail myself of the services of several guides. Governor TAFT. Did you find stones marking the hacienda, and did you run your lines by those marks? Señor CORCUERA. Yes, sir. If there is any difference, it is the fault of the guide, because I did not have an official guide from the hacienda, but had to avail myself of other guides. These boundaries are very clear. Governor TAFT. Most of the boundaries here [pointing to place on map] are natural boundaries, are they not? Señor CORCUERA. Yes, sir. Governor TAFT. Are all these boundaries here marked? Señor CORCUERA. Yes, sir; they are very well marked. Governor TAFT. Are not those old surveys, many of them, quite defective in the matter of area? Señor GUTIERREZ. Yes, sir; but all of our surveys have been made by engineers. Governor TAFT. Has Señor Gutierrez a map? Señor GUTIERREZ. Yes, sir; it is an old map. I have some maps in the office, but do not remember what the date of the survey is. Governor TAFT. I should think you might compare the maps. Señor CORCUERA. I have found a map in a house on the estate which was made, not by an engineer, but by a surveyor. I can not say whether it was like this one or not. Governor TAFT. I think we have agreed pretty well except with respect to Lolomboy, where there is a difference of 1,056 hectares. Archbishop GUIDI. This difficulty can be easily gotten over by a study between this map and the old maps. Señor CORCUERA. This estate adjoins the Santa Clara estate. Perhaps I have included in the Santa Clara estate the land which is lacking in this. I was told by the people on the hacienda there that they owned some other land in the pueblo of Polo belonging to this hacienda, and perhaps that is where the land lies. Governor TAFT. Did you go over this estate to examine the character of the land? Señor CORCUERA. Yes, sir; I have personally been over the estate. Governor TAFT. What is the character of the land on that estate? Señor CORCUERA. It is all rice land. Governor TAFT. How much a hectare will the best land produce in a year? Señor CORCUERA. In good seasons when there is plenty of water it will produce as high as 100 cavanes a hectare. Governor TAFT. What do they call land of that character? Señor CORCUERA. Superior quality. Governor TAFT. What is that worth in the province of Bulacan? Señor CORCUERA. Two hundred pesos a hectare. Governor TAFT. How do you fix that value? Señor CORCUERA. In making the valuation I went around to the neighboring towns to find out what property which had been sold at this time was worth, and taking |