Economic and Political Power in the Philippines Under US Rule: A Historical Analysis

The period of American rule in the Philippines (roughly 1898-1946) was a time of immense change. Following centuries under Spanish control, the islands transitioned to a new colonial master after the Spanish-American War. While the United States often presented its presence as a benevolent mission to prepare Filipinos for self-governance, the reality was a complex web of economic interests and the establishment of a specific political system that profoundly shaped Philippine society. A key aspect of this era was the intricate and often contrasting relationship between economic power and political power. Under the American flag, economic power largely remained concentrated in the hands of a traditional elite and American businesses, while political power was gradually introduced to Filipinos, but in a way that often reinforced the existing economic hierarchy.

Understanding this dynamic requires looking at how the US restructured both the economy and the political system. The American approach differed significantly from the Spanish in some ways, particularly in its emphasis on free trade and formal political institutions, but it also built upon existing structures, especially concerning land ownership and the influence of the local elite known as the principalia. This period wasn’t just about shifting colonial masters; it was about reshaping the very foundations of power and wealth in the archipelago.

The Arrival of American Influence and Initial Policies

When American forces arrived in 1898, the Philippines was in the midst of its own revolution against Spain. Filipino revolutionaries had declared independence and established the First Philippine Republic. The subsequent Philippine-American War (1899-1902, with resistance continuing for years) was a brutal conflict that saw the United States assert its military dominance. Once military control was largely established, the focus shifted to civil administration and the implementation of American policies.

The stated goal of the American civil government, established under figures like William Howard Taft (the first civil Governor-General), was “benevolent assimilation.” This meant integrating the Philippines into the American system, ostensibly for the benefit of the Filipinos, preparing them for eventual independence. However, this assimilation had a strong economic component. The US saw the Philippines as a source of raw materials and a potential market for American goods. This economic vision heavily influenced the political structures that were put in place.

Early policies aimed at pacifying the islands and establishing order. This included building infrastructure like roads, bridges, and ports, which served both military and economic purposes. A public school system was also introduced, using English as the medium of instruction, which created a new class of educated Filipinos who would be crucial in the emerging political system. However, these initial steps also began to reveal the biases and priorities of the new colonial administration.

Reshaping the Philippine Economy: Land, Trade, and Infrastructure

The American administration undertook significant measures to reorganize the Philippine economy. These policies had a direct impact on who held wealth and, consequently, who held influence.

Land Ownership and the Agrarian Structure

Land was, and remains, a fundamental source of wealth and power in the Philippines. The Spanish colonial system had already established large landholdings, including friar lands (lands owned by religious orders) and large haciendas (estates) owned by the local elite. The American period did little to fundamentally change this structure; in many ways, it solidified it.

Friar Lands Act of 1904: One of the key issues inherited from the Spanish era was the resentment over vast tracts of land owned by religious orders. The American government decided to purchase these lands from the Catholic Church. The goal was supposedly to redistribute them to landless farmers. However, the process was flawed. The lands were often sold in large blocks, which few small farmers could afford. Much of the land ended up being purchased by wealthy Filipino families or American companies, reinforcing existing inequalities.
Public Land Act of 1902: This act classified vast amounts of land as public domain. While it provided mechanisms for individuals to acquire land (homesteading, purchase), the limits on land ownership for individuals (16 hectares) and corporations (1024 hectares) were easily circumvented by wealthy individuals and companies using various means. Furthermore, the costs and bureaucratic hurdles involved in officially registering land titles made it difficult for poor farmers to secure their claims, leaving them vulnerable to dispossession.
Cadastral Surveys and Torrens System: The Americans introduced a system of land registration based on the Torrens system, aiming for clear titles and facilitating land transactions. While this modernized land administration, it often benefited those who could afford the surveys and legal fees – the principalia and large landowners – further solidifying their control over valuable agricultural land. Small farmers, often illiterate or lacking resources, frequently failed to register their ancestral lands and lost them.

The result of these land policies was the reinforcement, and in some cases, the worsening of land concentration. A relatively small number of families continued to own or control vast estates, while the majority of the population remained landless tenants or smallholders struggling to survive.

Trade Policies: Free Trade with the United States

Perhaps the most impactful economic policy was the establishment of free trade between the Philippines and the United States.

Payne-Aldrich Act of 1909: This act removed tariffs on most Philippine exports entering the US, and American goods entering the Philippines.
Underwood-Simmons Act of 1913: This expanded the free trade arrangement, removing remaining quotas on Philippine sugar and tobacco exports to the US.

Free trade spurred growth in Philippine exports, particularly sugar, coconut products, abaca (hemp), and tobacco. Large plantations dedicated to these cash crops expanded. However, this economic boom had significant drawbacks:

Dependence on the US Market: The Philippine economy became heavily reliant on exports to the United States. This made it vulnerable to changes in US demand and prices.
Neglect of Local Industries: Cheap American manufactured goods flooded the Philippine market, hindering the development of local industries. The focus shifted almost entirely to agricultural exports.
Benefit for Exporters and Landowners: The primary beneficiaries of the export boom were the large landowners and merchants involved in producing and trading these cash crops. They accumulated significant wealth, further enhancing their economic power. The vast majority of the population, working as tenants or laborers on these estates, saw little improvement in their living conditions.

This economic structure created a situation where wealth was concentrated in the hands of those who controlled land and participated in the export trade. This economic power base became the foundation for political influence.

Infrastructure Development

The US invested in infrastructure like roads, railways, ports, and communication systems. This development was presented as a means to modernize the islands and improve the lives of Filipinos. While it did facilitate internal movement and trade, it also served to connect resource-rich areas to ports, enabling the efficient extraction of raw materials for export to the US and consolidating American economic interests.

Table: Key US Economic Policies in the Philippines and Their Impact on Power

Policy / Initiative	Description	Intended Impact	Actual Impact on Power Distribution
Friar Lands Act (1904)	Purchase of friar lands from the Church and supposed redistribution.	Transfer land to landless farmers, resolve agrarian unrest.	Much land sold in large parcels, benefiting wealthy Filipinos and corporations; did not significantly reduce landlessness.
Public Land Act (1902)	Established rules for claiming public domain land (homesteading, purchase).	Provide opportunities for land acquisition, encourage settlement.	Bureaucratic hurdles, costs, and loopholes favored wealthy individuals and companies; small farmers struggled to gain titles.
Torrens System	Introduced system for clear land title registration.	Secure land ownership, facilitate transactions.	Benefited those who could afford surveys and legal fees (landowners, elite); further marginalized small farmers.
Free Trade (1909, 1913)	Eliminated tariffs between the US and Philippines for most goods.	Stimulate trade, integrate Philippine economy with US.	Created dependence on US market, harmed local industry, heavily benefited landowners and exporters of cash crops.
Infrastructure Projects	Building roads, railways, ports, communication systems.	Modernize the country, facilitate trade and administration.	Primarily served to connect export-producing areas to ports, facilitating resource extraction; aided large landowners and businesses.

These policies show a pattern where modernization efforts, while presenting benefits, often reinforced or exacerbated existing inequalities in land and wealth, solidifying the economic power of a few.

Establishing Political Control and Filipino Participation

Alongside economic restructuring, the Americans also introduced a new political system. This system was initially under direct American control but gradually allowed for increasing Filipino participation, culminating in the Commonwealth period.

The Structure of Colonial Governance

The highest authority rested with the American Governor-General, appointed by the US President. An executive branch, initially dominated by Americans, implemented policies. A judicial system, based on the American model, was also established.

The legislative branch saw the earliest significant Filipino participation.

Philippine Commission: Initially, this body held both executive and legislative powers and was composed mainly of Americans.
Philippine Assembly (established 1907): This was the first elected national legislature, composed entirely of Filipinos. While it had limited powers compared to the American-led Philippine Commission, it became a crucial platform for Filipino politicians.
Philippine Legislature (established 1916 by the Jones Law): This replaced the Commission and Assembly with a bicameral legislature: the Senate and the House of Representatives, both with Filipino majorities (though the Governor-General retained veto power).

Local government structures (provinces, municipalities) also saw Filipinos appointed or elected to positions relatively early in the American period.

The Rise of Filipino Political Parties

The American system allowed for the formation of political parties, which quickly became central to political life. The Federal Party initially advocated for statehood within the US, but parties advocating for immediate or eventual independence, like the Nacionalista Party, gained dominance. These parties provided a structure for political competition and mobilization.

However, participation in these political structures was initially limited by suffrage requirements, typically based on property ownership, literacy (in English or Spanish), or previous public office. These requirements effectively limited the right to vote and hold office to the educated and wealthy elite – precisely the same group that held economic power.

The Principalia and American Patronage

The Americans largely chose to work with the existing Filipino elite, the principalia. These were the wealthy, educated families who had held positions of influence under Spanish rule. The US saw them as natural leaders and intermediaries who could help maintain order and facilitate administration.

The principalia were incorporated into the political system, first through appointments to local positions and then increasingly through elections to the Philippine Assembly and later the Legislature. This partnership was mutually beneficial: the Americans gained allies and collaborators who could legitimize their rule and implement policies, while the principalia gained access to political power, patronage, and opportunities to further their economic interests.

This created a system where political office became a means to secure or enhance economic standing. Holding a position, whether as a municipal president, provincial governor, or legislator, provided access to resources, influence over policy, and opportunities for personal enrichment through land deals, business permits, or control over local economies.

The Interplay of Economic and Political Power: A Cycle of Elite Dominance

The most significant outcome of American policies was the deep intertwining of economic and political power, heavily concentrated in the hands of the Filipino elite and allied American businesses.

Economic Power Funding Political Ambition: Wealthy landowners and businessmen used their economic resources to fund political campaigns, build patronage networks, and secure votes. Running for office was expensive, and only those with significant means could afford it.
Political Power Protecting Economic Interests: Once in office, politicians from the elite used their positions to enact laws, influence regulations, and control resources in ways that benefited their economic interests and those of their allies. This included influencing land policies, trade regulations, taxation, and the awarding of government contracts.
Patronage and Clientelism: The political system developed strong elements of patronage. Politicians dispensed jobs, favors, and resources in exchange for loyalty and votes. This system relied on the control of economic resources, which the elite possessed. The flow of benefits often went from the political elite (who controlled state resources) back to their economic base (landowners, businesses) and their political base (followers who received favors).
Limited Representation for the Majority: Because the political system was dominated by the elite, the concerns of the majority of Filipinos – the landless peasants and urban laborers – were often marginalized. Policies tended to favor export agriculture and elite interests over agrarian reform or industrial development that might challenge the existing power structure.

This created a reinforcing cycle: economic wealth enabled political power, and political power facilitated the accumulation and protection of economic wealth. This fusion of powers ensured that despite the introduction of democratic institutions like elections and legislatures, the real power remained within a relatively narrow circle of elites.

The system established under US rule allowed the Filipino elite to maintain and even increase their wealth and influence by leveraging their participation in the new political framework.

Specific Policies and Their Broader Impact

Let’s look at a few more specific examples to illustrate this interplay.

The Philippine Autonomy Act (Jones Law) of 1916: This act promised independence once a “stable government” was established. It replaced the Philippine Commission and Assembly with a fully elected Philippine Legislature (Senate and House). While a significant step towards self-rule, the franchise remained limited, ensuring that the politicians elected represented the interests of the propertied and educated class. The law also maintained the Governor-General’s extensive powers, including the veto, ensuring American control could still be exerted. The stable government criteria was interpreted by the US to require a government that protected American interests, both economic and strategic, further tying political development to the prevailing economic system.
Pensionado Program: The American government sent promising Filipinos, mostly from elite families, to study in the United States. These “pensionados” returned to occupy important positions in the colonial bureaucracy, further embedding the elite within the administration and reinforcing American cultural and political norms among the future leaders. This policy helped create a pro-American orientation within the emerging Filipino leadership.
Establishment of the Bureau of Internal Revenue: While intended to create a more efficient tax system, taxation policies under the US often relied heavily on land taxes and business taxes, which could disproportionately affect smaller landholders and businesses compared to the large, well-connected elites who could find ways to minimize their tax burden or influence tax policy.

The combination of these policies created a landscape where formal political institutions existed, but operated within a framework heavily influenced by underlying economic structures and the powerful elite who controlled them.

Blockquote Example:

Historian Reynaldo Ileto, in his works, often highlights how formal political structures introduced by colonial powers like the US could mask underlying continuities in power relations, particularly the enduring influence of the principalia and the unresolved agrarian question that fueled popular discontent despite the appearance of political progress.

This underscores the point that the introduction of Western-style political institutions did not automatically lead to a democratic distribution of power; rather, these institutions were often adapted and utilized by existing power holders.

The Principalia and the American Partnership

The role of the principalia is central to understanding the US colonial period. Unlike some other colonial contexts where traditional elites were sidelined or actively suppressed, the Americans largely co-opted the Philippine principalia. There were several reasons for this:

Administrative Convenience: The Americans faced the challenge of governing a large, unfamiliar territory. The principalia already possessed local knowledge, existing social networks, and experience in administration under the Spanish. Partnering with them was far more efficient than trying to build a completely new administrative class from scratch.
Pacification and Stability: The US had just fought a war to subjugate the islands. Enlisting the cooperation of the principalia, many of whom had been involved in the revolution against Spain but were wary of the social changes it might bring, helped to stabilize the country and prevent further widespread resistance. The elite largely preferred order and economic opportunity under American rule to continued conflict or radical social upheaval.
Shared Interests: The American emphasis on private property rights, commercial agriculture for export, and limited government intervention in the economy aligned well with the economic interests of the landowning and merchant elite. They saw opportunities for wealth accumulation under the new free trade regime.
Cultural and Educational Affinity: The principalia were the most educated segment of the population, often speaking Spanish and quickly adopting English. They were the most receptive to Western political ideas (albeit interpreted through their own lens) and administrative practices.

This partnership meant that as political power was devolved to Filipinos, it flowed primarily to members of the principalia. They dominated the municipal councils, provincial boards, the Philippine Assembly, and later the Legislature. Key political figures like Sergio Osmeña, Manuel L. Quezon, and Manuel Roxas all hailed from prominent elite families.

This co-option had a profound impact:

It shaped the political agenda, which tended to prioritize issues favored by the elite (e.g., achieving independence under their leadership, protecting agricultural exports) while issues like land reform or labor rights received less attention.
It embedded the link between wealth and political office, setting a pattern that would persist in Philippine politics for decades.
It limited the degree to which the new political system could act as a force for broad social and economic change, as the controllers of the system had vested interests in maintaining the status quo.

Thus, the American period, while introducing formal democratic structures, simultaneously cemented the power of the existing elite by integrating them into these new institutions and aligning policies with their economic interests.

Labor and Peasant Issues: The Counterpoint to Elite Power

While the elite consolidated their economic and political power, the majority of the population faced continued hardship. The focus on export agriculture led to:

Increased Tenancy: As plantations expanded, more farmers lost their land and became tenants, sharing their harvest with the landlord. Tenancy rates soared in key agricultural regions.
Poor Labor Conditions: Plantation workers and laborers in emerging industries (like sugar milling) often faced low wages, long hours, and harsh working conditions.
Food Insecurity: The shift from growing staple crops (like rice) for local consumption to cash crops for export sometimes led to food shortages in certain areas.

These conditions fueled social unrest and the emergence of movements challenging the prevailing power structures.

Peasant Movements

Peasant revolts, which had occurred under Spanish rule, continued and sometimes intensified under the Americans. Groups like the Sakdalistas in the 1930s gained significant followings by highlighting issues of landlessness, rural poverty, and the perceived corruption and unresponsiveness of the elite-dominated government. The Sakdal Uprising of 1935, though quickly suppressed, was a stark reminder of the deep agrarian problems that the elite-controlled political system largely failed to address effectively.

Labor Movements

Industrial and agricultural labor unions also began to organize, demanding better wages and working conditions. Leaders like Crisanto Evangelista played a key role in early labor organizing, which sometimes intersected with socialist and communist ideas imported from abroad. These movements represented a challenge to the economic power of employers and landowners, and they often faced repression from the authorities who were aligned with the business interests.

The existence of these movements highlighted the significant gap between the rhetoric of “benevolent assimilation” and democratic progress championed by the elite leadership and the reality of poverty and powerlessness faced by the majority. While these movements achieved some limited successes, they were largely unable to fundamentally alter the economic and political landscape dominated by the elite.

List of Key Challenges Faced by Peasants and Laborers:

Widespread landlessness and high tenancy rates.
Exploitative labor practices on plantations and in factories.
Low wages and chronic poverty.
Lack of effective political representation for their interests.
Suppression of organizing efforts and dissent.

These challenges demonstrate the sharp contrast between the accumulation of power and wealth by the elite and the struggles of the majority under the economic and political system established during the American period.

The Commonwealth Period (1935-1946): Transition and Continuity

The Commonwealth period represented a significant step towards independence. Under the Tydings-McDuffie Act of 1934, the Philippines became a self-governing Commonwealth with its own constitution, president (Manuel L. Quezon), and expanded legislative powers, with full independence promised after a 10-year transition period (interrupted by WWII).

On the surface, this period saw greater Filipino control over their affairs. However, the underlying structures of power remained largely intact.

Elite Control: The Commonwealth government was dominated by the same political elite who had risen to prominence under the earlier colonial system. The presidency, legislature, and key government positions were held by figures from the principalia.
Economic Continuity: The economic structure, heavily reliant on agricultural exports and free trade with the US, continued. While some efforts were made towards economic diversification, the fundamental pattern of wealth concentration linked to land and export remained.
Limited Social Reform: Despite some rhetoric about social justice, the Commonwealth government made limited progress in addressing the deep-seated agrarian issues. Land reform faced strong opposition from the landowning elite who controlled the legislature. Peasant and labor movements continued to be active, sometimes clashing violently with government forces.

The Commonwealth period showed that transferring formal political power to Filipino hands did not automatically break the link between economic wealth and political influence. The established elite successfully transitioned into leadership roles in the new self-governing entity, largely preserving the economic status quo that benefited them. The system created during the direct American rule – where political positions were pathways to economic gain and economic power facilitated political control – continued to operate.

Comparing Spanish and US Approaches (Brief Overview)

While the core topic is the US period, a brief comparison with the Spanish era helps contextualize the changes and continuities.

Under Spanish rule, economic power was primarily based on land (through the encomienda and later hacienda systems, and friar lands) and participation in the Galleon Trade. Political power was highly centralized and hierarchical, with peninsular Spaniards at the top, followed by Spanish mestizos and the native principalia having limited local authority. Access to both economic and political power was exclusive and based on birth, race, and connection.

The US introduced:

Formal Free Trade: Replacing the more controlled Galleon Trade and later restrictive Spanish policies.
Focus on Export Agriculture: Intensifying the existing trend but integrating it more tightly with the US market.
Formal Democratic Institutions: Elections, legislatures, political parties – structures largely absent under the Spanish.
Mass Public Education: Creating a new layer of educated Filipinos, though the elite benefited most initially.

However, continuities were also significant:

Land Concentration: The US policies did not dismantle the large landholding system inherited from Spain; they often reinforced it.
Elite Influence: The principalia remained a powerful class, adapting to the new political system and using it to their advantage, much like they had navigated Spanish rule.
Unequal Power Distribution: While Filipinos gained more formal political power, the distribution of that power remained highly unequal, mirroring the unequal distribution of wealth.

In essence, the US replaced one colonial framework with another, introducing new institutions but often leveraging or adapting existing social and economic structures, particularly the power of the landed elite, rather than fundamentally dismantling them.

Legacy of US Rule on Power Structures

The patterns of economic and political power distribution established and solidified under US rule had a lasting impact on the Philippines.

Entrenched Elite Power: The American period cemented the political dominance of a relatively small number of wealthy families. This “oligarchy” has largely continued to control Philippine politics and economy since independence. Political dynasties became a feature of the landscape, with families passing down political offices and leveraging them for economic gain across generations.
Agrarian Problems: The failure to enact meaningful land reform during the American and Commonwealth periods left a legacy of agrarian unrest and poverty that continues to be a significant challenge for the country.
Economic Dependence: The reliance on agricultural exports and the close economic ties with the US, fostered during the free trade era, shaped the independent Philippine economy for decades.
Patronage Politics: The system of patronage and clientelism, where political power is used to distribute favors and resources, became deeply ingrained in the Philippine political culture.

The American colonial experience, therefore, was not simply a transition to self-governance; it was a period where key economic structures were reinforced, new political institutions were introduced in a way that empowered the existing elite, and the link between wealth and political power became firmly established, shaping the trajectory of the independent nation.

Key Takeaways:

The American colonial period in the Philippines saw a complex interplay between economic and political power.
US economic policies focused on land administration and free trade with the US, which primarily benefited the existing landowning elite and American businesses.
These policies reinforced the concentration of wealth in the hands of a few, often at the expense of landless peasants and laborers.
The US introduced formal democratic institutions like elections and legislatures, but these were largely controlled by the Filipino principalia (elite).
The principalia collaborated with the American administration, gaining access to political power and using it to protect and enhance their economic interests.
This created a cycle where economic power facilitated political power, and vice-versa, leading to a system of elite dominance.
Despite political progress towards self-rule, the underlying issues of land inequality and unequal power distribution remained largely unresolved throughout the American period and into the Commonwealth era.
The patterns of elite control and the fusion of economic and political power established during this time had a lasting legacy on the independent Philippines.

Frequently Asked Questions (FAQ):

Q: What was the main goal of American economic policy in the Philippines? A: A primary goal was to integrate the Philippine economy with that of the United States, seeing the islands as a source of raw materials (like sugar, abaca, coconut) and a market for American goods. Policies like free trade facilitated this.

Q: How did US land policies affect Filipinos? A: US land policies, while introducing modern registration systems, often made it difficult for poor farmers to secure land titles and allowed wealthy Filipinos and corporations to acquire large tracts, leading to increased landlessness and tenancy for the majority.

Q: Who were the principalia and what role did they play? A: The principalia were the existing Filipino elite – wealthy, educated families who had held influence under Spanish rule. The Americans largely partnered with them, incorporating them into the new political system. They used their political positions to protect their economic interests and became the dominant force in colonial politics.

Q: How did the introduction of elections and legislatures affect power distribution? A: While these institutions allowed Filipino participation, suffrage requirements and the economic costs of campaigning ensured that the principalia dominated elected positions. This meant that formal political power was concentrated in the hands of the same group that held economic power.

Q: Did the Commonwealth period change the relationship between economic and political power? A: The Commonwealth gave Filipinos more formal political control, but the government was led by the same elite who had gained power under direct US rule. The fundamental economic structures and the close link between wealth and political influence remained largely unchanged.

Q: What was the lasting legacy of US rule on Philippine power structures? A: US rule cemented the political dominance of the Filipino elite, deepened agrarian problems due to unresolved land issues, created economic dependence on the US, and ingrained patterns of patronage politics, all of which continued to shape the independent nation.

Conclusion

The American colonial period profoundly transformed the Philippines, introducing new economic systems and political institutions. While the stated goal was to prepare the islands for democratic self-governance, the reality was a complex process where economic restructuring and political development were deeply intertwined. US policies, particularly concerning land and trade, reinforced existing inequalities and concentrated economic power in the hands of a Filipino elite and American businesses. Simultaneously, the political system that was gradually opened to Filipino participation was structured in a way that allowed this same elite to gain and maintain control, effectively fusing economic and political power.

This created a dynamic where the formal structures of democracy coexisted with an underlying system of elite dominance. The principalia, by collaborating with the American administration and leveraging their wealth, secured their position at the apex of both the economic and political hierarchies. This partnership, while bringing certain modernizations and setting the stage for eventual independence, did not lead to a broad distribution of power or wealth among the Filipino people. Instead, it solidified patterns of inequality and elite control that would shape the challenges faced by the Philippines in the post-independence era. Understanding the contrast and connection between economic and political power under US rule is therefore essential to grasping the historical roots of contemporary power structures in the Philippines.

Category: American Colonial Period (1901-1946), US Civil Administration