resulted and the injury is only temporary. In all the rest of the archipelago there has been a very considerable increase in the amount of lands planted over the preceding year. The increase in rice, hemp, and cocoanuts has been especially notable. The rinderpest and other diseases which afflicted the carabaos, horses, and cattle have been practically exterminated, and while the people still need more work cattle than they have the supply is slowly but steadily increasing. The insular government, through its board of health, has kept a large force of men in the field who have inoculated the cattle, and this made them immune against rinderpest. It is believed that there is no further danger from this source. The present rice crop bids fair to be largely in excess of that of any preceding year since the insurrection, and importations of rice have greatly fallen off, though for some time to come they must still continue. The high prices and continued demand for hemp and copra have greatly stimulated the planting of abaca and cocoanuts throughout the islands. The sugar industry has been in a languishing condition for several years past. Last year, however, the small crop that was produced netted a satisfactory price, and as a result the crop planted this year is considerably larger than last year, although far below the output prior to the insurrection. With the exception of the provinces of Cavite, Batangas, and Samar, peace and order have generally prevailed throughout the islands. Except in these provinces the instances of lawlessness have been few and insignificant. Cattle stealing, which was common two or three years since, has almost entirely ceased, and this, together with the sense of security which has come to the people from a vigorous pursuit of these evil doers, has principally contributed to the increased cultivation mentioned above. The provinces of Cavite, Batangas, and Samar have been much afflicted during the year by organized ladrone bands, which for a considerable time past have terrorized and plundered the people at intervals. The effect of their depredations resulted in the abandonment by many of the inhabitants of their richest and best agricultural lands, and the moving into the towns of the farming class, where to some extent at least police protection was afforded them. This, together with the reconcentration made necessary in the course of the campaign against these bands of outlaws, still further disturbed industrial conditions and retarded the progress of the people in agriculture. The history of these ladrone outbreaks and of the operations against them by the military forces, constabulary, and scouts, which resulted in their practical extermination, is thoroughly well known to the Commission, is told in the reports of the secretary of commerce and police and the chief of the Philippines Constabulary, and, moreover, is very fully dealt with in the report of the Commission to the Secretary of War, and therefore need not be repeated here. It may be stated, however, that in the provinces of

Cavite and Batangas, since the wiping out of these ladrone bands, the people have been able to return to their homes and have planted a larger area of land than during any year since the insurrection. In Samar the principal industry is the production of hemp, and it is still considerably disturbed, although order is gradually being restored and the outlook for this province is much better than during the past year.

THE MORO PROVINCE.

Since my last report there has been a marked improvement in conditions in the Moro Province. There has been a steady growth and development in agriculture, and, with the exception of the opposition which was maintained by Dato Ali in the Cottabato Valley, who has just been killed, everything has, as a rule, been peaceful and quiet. There was during the year a spasmodic outbreak of a few Moros on the island of Jolo, which, however, was neither serious nor protracted and was soon ended. There was also a similar exhibition of fanaticism and enmity on the part of a dato in the Lake Lanao region, which amounted to but little. Generally speaking, it may be said that as to this province it is, of course, a work of time, tact, and constant watchfulness to change the feelings of the Moros toward us from suspicion and distrust to friendship and confidence. Still, more than a beginning has been made, and a continuation of the same firm and consistent policy which has characterized the present administration of affairs in that province will undoubtedly bear good fruit in the future. There has been a very considerable influx of American and foreign settlers into the magnificent island of Mindanao, especially in the neighborhood of Davao, who are engaged in clearing public land and planting cocoanuts and abaca upon a considerable scale. It may be mentioned that they are squatting upon and improving public land in the expectation that the insular government will deal justly by them. So far it has not been deemed expedient to apply the public-land act to any part of the Moro Province, for the reason that the Moro datos in a general way lay claim to all of the lands within their respective jurisdictions, which were, as a rule, illy defined and unsettled, and it was feared that the entrance of settlers would provoke disputes and bloodshed, but it is believed that the time has come when at least a portion of the land laws may be safely applied to certain sections of the province. This matter has already been carefully considered by the Commission, and action will doubtless be taken at an early day.

The reports of the various provincial governors will be found appended to the report of the executive secretary, which is attached hereto as Exhibit A.

On the 12th day of November, 1904, accompanied by Commissioners Luzuriaga and Forbes, I left Manila for a trip through the

southern provinces. We were away twenty-six days, and during that time visited the provinces of Iloilo, Occidental Negros, Samar, Leyte, Surigao, Misamis, various points in the Moro Province, Oriental Negros, Cebu, Albay, Sorsogon, and Batangas. In all of these provinces, with the possible exception of Surigao, which contains as yet much undeveloped wilderness and lacks means of communication between its towns, except by water in favorable seasons, evidences of prosperity and progress were abundant. In every community there were found some persons who were waking up to their opportunities and were taking advantage of modern methods in their work. The majority of the people seem contented, and the unrest of the discontented ones was invariably due largely if not wholly to local feuds, which by their existence had placed them in an attitude of opposition to the efforts of the authorities in office. At each place visited conferences were held with the assembly of municipal presidents, who had come to meet us, and attempts were made to ascertain what local abuses, if any, existed, and to correct them. The needs of the people were inquired into and the administration of provincial affairs was examined. The warm hospitality of the Filipino people made this trip of inspection a most agreeable one, and we returned to Manila with a more intimate knowledge of conditions in the south and a better appreciation of the political and administrative difficulties which confront provincial officials.

On the 2d of February, 1905, accompanied by Commissioners Tavera and Legarda, I visited Cavite and held a conference with the leading men of the province over the ladrone question, in an endeavor to stir them up to active cooperation with the forces of the government in ridding their vicinity of the bands of outlaws which were then infesting the neighborhood. The situation was gone over with them at length and their public spirit appealed to, and it is believed that the conference was successful in some cases in bringing into line certain antagonistic elements and in crystallizing and directing the good intentions of many of the others.

In all of the provinces which we visited we took up the question of the desirability of the enactment by the Commission of a compulsory road-tax law, which should provide for the adoption by the assembly of municipal presidents in each province jointly with the provincial board of a law requiring every able-bodied male inhabitant in the province to work not exceeding five days each year upon the roads or to pay in lieu thereof a sum sufficient to employ a laborer in his stead, this sum to be regulated in accordance with the daily "jornal ” or wage in each province. The need for some such measure is imperative if we are to maintain highways in the provinces which shall be passable at all seasons of the year. By far the larger portion of the present roads in the islands become bogs during the rainy season, and constant repair work is necessary and unavoidable. There is com

paratively little money available for this work or for the construction of the many new highways which are so urgently needed, and it is but right that the people who are to enjoy the benefits which will inevitably be derived from new and improved highways should lend their aid to their building and maintenance. A road tax of this character is customary in the United States, where its immense value to the people is thoroughly understood. We found no intelligent opposition to the establishment of this tax in the provinces; indeed, on the contrary, many of them urged its adoption at once. I therefore recommend the adoption of such a law, giving authority to the assembly of municipal presidents in conjunction with the provincial board to provide for the establishment in each province of the road tax suggested.

CITY OF MANILA.

The report of the municipal board of Manila does not call for any extended discussion. The operations of its various departments, together with the receipts and expenditures for the fiscal year, are fully set forth. A considerable amount of preliminary work looking to an extension of the water system and of the sewer system of the city has been accomplished. Under an arrangement with the Atlantic, Gulf and Pacific Company, which has the contract for dredging and otherwise improving the harbor of Manila, the moat around the Walled City has been filled. A number of new streets have been opened, old streets have been widened, and improvements of a like character have been made during the year. Altogether the operation of the municipal board has been satisfactory and successful. A copy of the report will be found attached hereto as Exhibit B.

INSULAR PURCHASING AGENT.

The administration of this office has notably improved during the past year, and I am glad to be able to say that there have been no complaints of lack of prompt attention to orders given and of service performed. The total sales during the fiscal year aggregated P4,936,976.79, a decrease of 7 per cent from those of the previous year. The cost of administration, including salaries, wages, and contingent expenses, aggregated about 11 per cent of total sales. Herewith will be found a copy of the report of the chief of the office, marked Exhibit C, which gives in detail all needed information as to operations of his office during the fiscal year.

CIVIL SERVICE BOARD.

It appears that 8,232 applicants were examined by the board during the fiscal year, against 5,911 during the preceding fiscal year. Of these, 4,185 took examinations in English and the remainder in Spanish. Of the applicants entering examinations in English, 2,917,

or 70 per cent, were Filipinos, while of the 2,443 applicants taking English examinations in 1904 only 44 per cent were Filipinos. These figures strikingly indicate the rapid spread of the knowledge of the English language among the Filipinos and the increasing interest taken by them in acquiring that language. The policy of the Commission has been to employ Filipinos in the service wherever competent and available. On January 1, 1904, the ratio of Americans to Filipinos was only slightly in favor of the latter, but on January 1, 1905, it was approximately three Americans to four Filipinos. The proportion in favor of the latter is steadily increasing, and it is believed that by the end of this calendar year the ratio will be about one to two. The result of this policy is increased economy in administration, and at the same time must convince the Filipinos of our altruistic attitude toward them. While for several years to come the more responsible and more important positions in the various bureaus of the insular government must of necessity be filled by Americans, yet with the acquisition of English by ambitious and intelligent young natives the field of their employment should and will constantly widen. There has been a high standard of sobriety, efficiency, and general conduct maintained in the civil service during the year, and I am glad to be able to say that the number of removals and reductions has been small in subordinate positions.

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Attached hereto will be found as Exhibit D a copy of the report of the Philippine civil service board, which will fully repay perusal.

EXECUTIVE BUREAU.

Attached hereto as Exhibit A is a copy of the report of the executive secretary, and from a careful reading of this report the everincreasing volume of work in the executive bureau is plainly apparent. The report is full of detailed information regarding the work of the office, which can be procured from no other source, and in this way it becomes interesting and a valuable document, but there is in it nothing which I need call to the especial attention of the Commission at this time.

Exhibit E, attached hereto, contains a very full description by the auditor of the manner in which the Commission has, during the year, spent the balance remaining on hand of the relief fund of $3,000,000 appropriated by the Congress of the United States by act approved March 3, 1903.

Exhibit F consists of copies of all executive orders and proclamations issued by me during the year. Respectfully submitted.

LUKE E. WRIGHT,

Governor-General.