"Do you believe, Mr. Speaker, that any one investor would ever, if he could prevent it, permit the United States to escape from its responsibility?"-(Speech of Manuel Quezon in United States House of Representatives, May 1, 1912.) The Philippine Constitution provides, in part, as follows:

ART. III. Sec. 1-No person shall be deprived of life, liberty, or property without due process of law.

Sec. 2-Private property shall not be taken for public use without just compensation.

Sec. 10-No law impairing the obligation of contracts shall be passed. Art. XVI, Sec. 1-* ** all existing property rights of citizens or corporations of the United States shall be respected and safeguarded to the same extent as property rights of citizens of the Philippines.

The Ordinance Appended to the Constitution Provides :

Sec. 1-Notwithstanding the provisions of the foregoing Constitution, pending the final and complete withdrawal of the Sovereignty of the United States over the Philippines (sub-sec. 7) the debts, liabilities, and obligations of the present Government of the Philippine Islands, its provinces, municipalites, and instrumentalities, valid and subsisting at the time of the adoption of the Constitution, shall be assumed and paid by the Government of the Commonwealth of the Philippines. (15) The United States may, by presidential proclamation, exercise the right to intervene for the preservation of the Government of the Commonwealth of the Philippines and for the maintenance of the Government as provided in the Constitution thereof, and for the protection of life, property, and individual liberty and for the discharge of government obligations under and in accordance with the provisions of the constitution. (19) The President of the United States shall have authority to suspend the taking effect of or the operation of any law, contract, or executive order of the Government of the Commonwealth of the Philippines, which in his judgment will result in a failure of the Government of the Commonwealth of the Philippines to fulfill its contracts, *

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The obligation, together with the power to protect the citizens of the United States, is vested in the President of the United States.

From the above it is clear that the President of the United States is charged with the duty and given the power to see that the Commonwealth of the Philippines respects and safeguards all property rights of citizens of the United States; that no person be deprived of property without due process of law; that the private property of the citizens of the United States shall not be taken without just compensation, and that no law impairing the obligation of contracts shall be passed; that all debts, liabilities, and obligations of the former Government of the Philippine Islands or its instrumentalities, valid and subsisting at the time of the adoption of the Constitution, shall be assumed and paid by the Government of the Commonwealth.

That such power is not a naked aggregation of words is established by the following cases decided by the Philippine and U. S. Supreme Courts on questions involving the Organic Act of the Philippines.

Myers v. U. S., 272 U. S. 52; 71 L. ed. 160; Springer v. Philippine Islands, 277 U. S. 189; 72 L. ed. 845.

Speaking of the duty of the Governor General acting as the representative of the United States, the Supreme Court said:

"It would be a violation of his sworn duty to enforce or permit the enforcement of an illegal act."

Government of the Philippine Islands v. Springer, 50 P. R. 259.

The passage of Act 187, providing for the "liquidation of the Teachers Retirement and Disability Fund" and providing for immediate reduction of the annuities payable to the contracting employees and the ultimate complete cessation of all payments under the insurance contracts, accompanied by Acts 188 and 189, liquidating other retirement funds, followed by the immediate act of the executive department in thus depriving the retired employees of their only means of support in their old age, is proof conclusive that the President should and must immediately act to protect these employees who have faithfully and loyally dedicated their useful years in the service of this dependency of the United States.

As was stated by Ralston Hayden:

"Never before in the history of the world has a powerful nation assumed toward a weaker one quite such an attitude as we have adopted towards the Filipinos. I make this statement without thought of disparaging the admirable work which Great Britain has done in her Colonies, but on the contrary in the conviction that in some particulars we ourselves have gone too fast and too far, and as a result are likely in the end to have forcibly brought home to us

the wisdom of making haste somewhat more slowly, and paying more heed to the experience of others when dealing with new problems. However, it will do those of us who thought that we were infallible. if such there be, a world of good to learn that this is not the case, and it will do our Filipino wards good to discover, one of these days, that we can, if necessary, take away as well as give.”—The Philippines Past and Present, Worcester-Hayden (1930), p. 668. The United States Supreme Court, on May 3, 1937, expressed the matter in the following language:

"The Philippine Islands and their inhabitants, from the beginning of our occupation, have borne a peculiar relationship to the United States. The Islands constitute a dependency over which the United States for more than a generation, has had and exercised supreme power of legislation and administration. Posadas v. National City Bank, 296 U. S. 497, 502; 80 L. ed. 351, 354; 56 S. Ct. 349. A power limited only by the terms of the treaty of cession and those principles of the constitution which by their nature are inherently inviolable. The possession of this well night absolute power over a dependent people carries with it great obligations (p. 710). A dependency has no government but that of the United States, except in so far as the United States may permit * * * (p. 712). But the authority which conferred additional power might at any time have withdrawn it.

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"This brief résumé demonstrates both the completeness and flexibility of the national power over the Philippines, and the high character of the moral obligations which the possession of such power correlatively imposes (p. 713). * * "So far as the United States is concerned, the Philippine Islands are not yet foreign territory. By express provisions of the Independence Act, we still retain powers with respect to our trade relations with the Islands, with certain exceptions set forth particularly in the Act. We retain powers with respect to their financial operations and their currency; and we continue to control their foreign relations. The power of review by this court over Philippine cases, as now provided by law, is not only continued, but is extended to all cases involving the Constitution of the Commonwealth of the Philippine Islands. "Thus, while the power of the United States has been modified, it has not been abolished."

Cincinnati Soap Co. v. U. S., 81 L. ed. Advance Opinions, 707, 710, 712, 713. This is the latest word on the subject. It impresses the moral obligation imposed upon the United States. This duty is not performed by supporting the Philippine Government in any act it may desire to pass, but in protecting the rights of the people against official usurpation. Immediate action on the part of the national power may bring the Government of this dependency to a realization of the duty it owes to mankind and prevent future lapses.

CONCLUSION

This petition is presented primarily on behalf of the retired American employees of the Bureau of Education and the facts and arguments have, therefore, tended to present their situation more closely than that of the other employees. It is not intended, however, in any way to disparage the services rendered by or to detract from the obligations which may be owing to that large group of faithful and self-sacrificing Filipino and American employees in this or any other branch of the Philippine Government, whether now retired or still in the service, who have also contributed toward the retirement annuities contracted to be paid them by the Philippine Government.

It is clear that if the Commonwealth Government of the Philippines is permitted to disregard its moral, social, and contractual duty in this matter and while the United States is still responsible for its conduct, then certainly there will be no assurance on which anyone may rely in the future when the Islands may become an independent political entity. Failure now to comply with its obligations will be properly laid directly at the door of the United States and any future disregard of its moral duties among the peoples and nations of the world will be a lasting reproach to the Government of the United States.

Respectfully submitted.

CLARKE J. MILLIRON,
Attorney for Petitioners.

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INSERTION AS TO ACT OF PHILIPPINE ASSEMBLY, PASSED SEPTEMBER 9, 1937 After this petition had been printed and was ready to be submitted, a copy of the Manila Daily Bulletin, of September 10, 1937, was received by air mail.

It was therein stated that a new Bill had been passed by the Philippine Assembly, providing for the restoration to the retired employees of the annuities heretofore accrued, which had been confiscated by the Philippine Government, and providing further for annual appropriations, out of any funds not otherwise appropriated, to pay the annuities due hereafter to those employees who had actually retired and were receiving pensions prior to November 14, 1936.

The new Bill does not provide for the restoration of the funds heretofore confiscated by the Government, nor does it provide any fund for the future protection of the employees heretofore retired.

The new Bill does not provide in any manner or form for the future protection of the employees who have heretofore contributed to the retirement fund but who had not actually retired prior to November 14, 1936.

In his message to the legislature, proposing the new Bill, President Quezon stated:

"By an act of the United States Congress, enacted in consonance with an established policy consistently followed ever since the implantation of American sovereignty in the Philippines, of reverting to the Philippine Treasury the taxes collected in the United States on articles and goods imported from the Philippines, we have now in the general fund more than sufficient money to correct the injustice that has been committed against the said pensioners."

In his message, however, he did not recommend that a fund be set aside out of these moneys whereby the rights of the contracting parties should be protected in the future.

The moneys to which his message referred were those taxes collected in the United States under the cocoanut oil processing tax, but, on the complete separation of the Philippine Government from the United States and the cessation of these payments by the United States Government, the claim of bankruptcy will promptly be again raised.

This belated gesture on the part of the Philippine Assembly to seemingly comply with their obligation to their employees, who have heretofore paid the Government their several contributions in accordance with the prescribed contract, is an admission of the substantial justice of the cause of the teachers and an acqnowledgement of the fraud perpetrated. It is, however, a transparent effort to still evade their obligation by restoring their annuities while the United States still retains power to enforce the contract but to retain complete control of the fund and to dedicate the fund to the payment of annuities to the entire personnel of the Islands, most of whom have not participated in its creation. If they are to be permitted to dissimilate on this question a few more years and can then attain their desired separation from control, then "their ideals" can again be applied.

President Quezon wired Collier's Weekly from the Steamship President Hoover on his return to the Philippines this month. His wire, taken from Collier's Weekly of September 11, 1937, states in part:

"In my recent trip I submitted to President Roosevelt the advisability of advancing the date of independence and I have not withdrawn that proposal. I believe it best for the Philippines no less than for America to hasten political separation, thus giving the Philippine people full power and responsibility to direct their own national life, in accordance with their ideals, and by means of their own choice, at the same time relieving America of any further responsibility for the protection of the Philippines."

In the face of this statement of desire for full power to direct their affairs in accordance with "their ideals," and to relieve America of any future responsibility, coupled with the restive proposal for complete separation in two years, it is indicated to thinking Americans that, if the United States feels that they can, with honor to themselves, and justice to the dependent peoples of the Philippine Islands, relinquish the small thread of control still retained, then it is the bounden duty of the United States to first require that a sufficient sum be set aside in the United States treasury to provide security during their declining years to the retired employees who aided in building the best colonial government the world ever knew.

The action taken by the Philippine Assembly in no way detracts from or modifies the facts recited in this petition, nor does it in any way change the prayer of your petitioners that:

You cause to be set aside a sufficient fund out of the revenues of the Philippine Government to guarantee the future payments due under the several contracts in order that your petitioners may be protected against future confiscations; or, that the Government of the United States directly assume the debt.

COMPLETE INDEPENDENCE OF THE PHILIPPINE ISLANDS

FRIDAY, MARCH 3, 1939

UNITED STATES SENATE,

COMMITTEE ON TERRITORIES AND INSULAR AFFAIRS,

Washington, D. C.

The committee met, pursuant to adjournment, at 10:30 a. m., in room 424, Senate Office Building, Senator Tydings presiding.

Present: Senators Tydings, Pittman, Hayden, Lodge, Vandenberg, Miller, Gibson, Lundeen, and Bone.

The CHAIRMAN. I understand when the committee adjourned the last time that Mr. Loomis asked that he be called today first, and, without objection, we will proceed with Mr. Loomis.

Mr. LOOMIS. Mr. Chairman, I would like to ask the indulgence of the committee to be permitted to remain seated for this. I have had a little hospital experience recently and I hope with the further indulgence of the committee to have quite a little time, and I don't want to stand on my feet during the entire talk.

The CHAIRMAN. That will be all right; you may be seated.

Mr. Loomis, will you identify yourself by giving your full name and organization and address?

STATEMENT OF A. M. LOOMIS, DOMESTIC FATS AND OILS

CONFERENCE, WASHINGTON, D. C.

Mr. LOOMIS. My name is A. M. Loomis; address, 945 Pennsylvania Avenue, Washington, D. C.

I am appearing as the representative of the Domestic Fats and Oils Conference, as Washington representative of the Association of American Producers of Domestic Inedible Fats, and as the secretary and Washington representative of the National Dairy Union.

This group of organizations represents a substantial part of all of the producers of fats and oils in the United States. We believe it is much more than a majority part of all the fats and oils producers in the United States. And since I am appearing particularly with reference to fats and oils, most of my statement will be limited to that part of the bill which is before you which relates to the copra and coconutoil situation as between the United States and the Philippine Islands. I want to speak briefly at the outset with reference to the TydingsMcDuffie Act, because this act before you is an amendment to that act. Now, the Tydings-McDuffie Act was placed on the statute books of the United States after long and detailed study and investigation. I was very much interested in all parts of that study and investigation; was here in Washington all the time representing a part of the same

group that I represent now, and I am speaking from my personal experiences in connection with that.

When that act was finally adopted and went on the statute books it represented compromises, and among those compromises were those which affect the coconut-oil situation. Quite a good deal of that compromise was not approved by our fats and oils producing interests, excepting that we approved it as a compromise to get the main objective across, and the main objective was independence for the Philippine Islands in the shortest possible time.

Now that is the major question, the question which we believe is of paramount importance at the present time. We want to be fairly treated as to the competition between coconut oil and our products in the United States. But we are more concerned with immediate, or the earliest possible independence of the Philippine Islands when we can get at this matter of competition and international trade and handle it upon the same relationship as we handle those similar problems between the United States and all other independent countries of the world. And we are willing to accept compromises as to coconut oil in order to get that objective of early independence, and that is the reason why I say at the outset that we are here in definite opposition to this present bill. We don't see any way that this bill which is now before you can be doctored up to the point where it will produce the objective which we are after, and that is the independence of the Philippine Islands in 1946.

Now to go into a few of the details of that compromise. As to coconut oil, that compromise went into two phases.

First, a quota, and second, an export tax in the Philippine Islands on exports of coconut oil. We didn't like it then because the matter of copra was not taken care of and treated in that act, but there was rather a substantial reason why copra could not be taken up and treated, because at that time it was on the free list in the United States under the tariff act, and it would have been a pretty difficult matter and led to a lot of legislative complications as well as others, to have tried to have done something about the imports of copra at that time.

So we waived our objections and did the best we could to get fair treatment with respect to quotas and accepted the export tax at that time because we were entirely out of line with the quota which was placed in the Tydings-McDuffie Act. I will come to this question of quotas again, I think, but let me say here, the quota, as you all know, which is in the Tydings-McDuffie Act is now continued until 1946 in the present bill, and then the basis of the future quota is 200,000 long tons per year.

Well, there never was any sense in establishing that particular figure. They never had sent that much coconut oil in the United States. In view of our long-time activity in this country to induce the increased production of our own domestic oils, and the success which was being accomplished with that program, there never was any future prospect that we would ever need 200,000 long tons of coconut oil imported from the Philippines in this country.

Coming to this a little later on, I will read some of the figures on this coconut-oil import situation, and indicate to you what it seems to me might be a fair quota for that item.