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Early after the beginning of the fiscal year the last of the Cuban troops had received their proportion of the money appropriated by the United States and the last vestige of the organization had disappeared. From that time the problem confronting the government in this department has been purely a civil and economical one, as there has been no occasion requiring the employment of any military force whatever.

At the beginning of the fiscal year the towns and cities of the department found themselves burdened with debts accumulated in the past months which they had no sufficient revenues to cover, as real estate, from which their revenues had formerly been derived, had been exempted from taxation in order to enable them to recover more rapidly from the effects of war and from the commercial depression resulting therefrom.

Before the insular government could limit this indebtedness the budget of these municipalities had to be put in proper shape. The disorder existing in their accounts had resulted from the unsettled conditions following the war and the uncertainty as to whether the bookkeepers and clerks, or even the mayors themselves, would receive compensation for their labor.

The proper indebtedness of all the municipalities from the date of the American occupation to the 1st of January, 1900, having been finally worked out and passed upon, their deficits were paid by funds allotted from the insular treasury, and they were thus enabled to start afresh with their expenses under the new régime definitely limited by the intervening government. The number and pay of the police was fixed and the number and salaries of other municipal officers regulated by order of the Governor-General in accordance with the necessities of the place and conditions. The schools, charities, hospitals, and prisons were looked after by the general government, and the only thing for which the municipality still had to provide an income was for the needs of the town for salaries, light, water, and conveniences, and in towns not occupied by United States troops, for sanitation also. The municipalities were able, from the small revenues obtained by licenses and taxes on business stands, street vendors, public conveyances, etc., to meet these small necessities. In some cases they availed themselves of the rent of buildings belonging to the municipality, such as market houses and other property suitable for stores. Hospitals, charities, and jails during the first part of the year required a large outlay of money to put them in such a condition that proper cleanliness and discipline could be required of their custodians.

Some of the charitable institutions had up to the time the intervening government began to aid them been supported by substantial contributions from bequests, investments, and private charity, or from the treasuries of the religious orders which controlled them. It has been found that, once the institution was known to be in receipt of government assistance, all private contributions ceased, the people acting on the theory that the government would now look out for such institutions, leaving them at liberty to bestow their charity otherwise. As it was not the policy of the government to give absolute control of an institution supported by public funds to any religious order, these orders in several cases withdrew not only their financial assistance, but also their personal aid in their management and conduct. All the asylums are now in excellent condition as to buildings and equipment, but the need of trained managers is felt. It is thought

that if managers of experience from the United States could be employed in the principal institutions for a limited time-say one year-the Cuban superintendents under their instruction would thereafter be able to carry on the work upon approved methods, so as to secure healthful employment of the children under their care and break up the system of merely killing time, upon which theory the management of these institutions seems to have been carried on under the Spaniards. While much good is expected from the asylums as they are developed into manual training and agricultural schools, yet it is believed that the number of inmates is at present entirely too large, and that systematic effort would result in returning many of these children to the care of relatives who are now or may hereafter become able and willing to support and properly care for them.

The civil hospitals, on which great attention has been bestowed, have been in many cases reconstructed and are now in excellent condition. Great benefit has been derived from the presence in these hospitals, as well as in some of the asylums, of trained nurses and kindergartners from the United States. The results of their training as nurses and instructors will become more evident in the near future, as they are just now finding themselves supplied with appliances and the means for carrying out their ideas of management.

These hospitals would offer to the young medical student great opportunities for practice and experience, but it would seem that there is no great competition for the positions as ward physicians, there being difficulty, it is said, in finding such as are willing to undergo the inconvenience of being on duty at night. It is believed that if these opportunities for practice were offered to the more ambitious and energetic young medical graduates, this difficulty would disappear. The condition of the jails from the time of our entering the island was a source of much trouble and concern. In spite of decrees aimed at hastening the administration of justice, and in spite of the fact that a large number of prisoners under sentence for political and military offences had been released by military order soon after our occupation, the jails continued rapidly to fill up and the number of prisonersalmost all awaiting trial-continued to increase from day to day. The situation was frequently brought to the attention of those in higher authority, and the jails were again cleared by a commission appointed by the Governor-General. The methods of legal procedure were also modified in such a way as to compel the attendance of witnesses and to secure the payment of their fees. Under these conditions and with the assistance of the correctional or police courts, which have just been organized, it is not anticipated that the problem of the jails will occur again.

In connection with the jails it is to be noted that there was no provision for the care of the violently insane, who, under Spanish practice, were confined in cells of the regular jails for observation. The sight of these poor creatures, like caged wild animals, was one of the most revolting spectacles to be seen in Cuba. These insane people are at this time sent to Habana, where they are kept in separate institutions for observation and treatment.

For further details as to the hospitals, asylums, and jails, special attention is invited to the full and able reports submitted from time to time on these subjects by Maj. Frank J. Ives, chief surgeon, and to his final report submitted herewith, marked "Exhibit M."

WAR 1900-VOL 1, PT HI- -18

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The recent municipal elections passed in these provinces without the slightest disturbance to public order. A few weeks previous to the election it was reported to me that in some of the municipalities of Santa Clara the existing municipal authorities and some members of the rural guard of the province had been giving out that certain candidates had been indicated by the Government, following the old Spanish system. This was evidently with the hope that the more timid voters might be influenced in this way. I took occasion to make a trip through the provinces and to visit particularly these localities in which the rural guard and authorities were said to be active partisans in the campaign.

All officials were cautioned to refrain from interference in the elections, or from advocating any candidate over another. The rural guard was ordered away from two municipalities where it had been alleged that they had been acting as partisans, but it was not deemed necessary to supply their places by ordering United States troops into the vicinity. The correctness of this opinion proved later when the elections were held in these towns without the slightest disturbance. The precaution was taken of ordering all municipal guards to confine themselves to their barracks throughout the hours of election, except when going to and returning from the polls, which they were required to do without arms and one at a time. The municipal police on that day were hardly in evidence on account of the necessity for one of them at every outlying suburb where there was a voting place.

The excellent order everywhere preserved was due to the individual effort of the civil authorities and people themselves, who, though in some instances fearing disorder, had determined that it should not come from them or from their party. A remarkable instance of the degree to which this determination to have a quiet election was carried was exhibited in one town where the rival candidates agreed that when a demonstration was made in favor of one, he should appear escorted by leading men of the other side, in order to show the people that though there was rivalry there was no enmity.

The temperate character of the people made election day throughout the department appear more like a Sunday than a day of anxiety. No drunkenness nor disorder of any kind was observed. I had officers observing the election at different points in the department, but they had no occasion to take any action whatever to preserve order. The election seems to have also passed with few or no attempts at fraud, and their results have been frankly accepted as the fair expression of the popular will by the defeated candidates and their supporters. As a general rule in this department the contests were purely personal, there being little or no difference in the principles of the opposing candidates.

It should be observed that one of the first duties the municipalities will have to perform upon receiving full authority to collect taxes and to disburse them according to their own judgment, will be to reduce the number of their officials and employees. Quite a number of these municipalities and barrios are too small and too poor for separate existence. It will require, however, a rude shock to banish the firmly rooted idea that a dying town, like a dying individual, should be nursed back to life. There are many municipalities which have for years been kept alive by the assistance of the insular government.

Their disappearance, or their absorption by the adjoining municipalities, would be beneficial to all concerned, as it will facilitate the formation of counties and the equitable distribution of political power.

No rural guard was organized in the province of Matanzas in the belief that a proper municipal police would subserve all necessary purposes and free the people from the dominating influences of an armed military organization controlled by a central authority. This expectation has been sustained by experience. The province of Matanzas with few more municipal police than the province of Santa Clara, has not felt the need of a rural force. The rural guard of Santa Clara, while an excellent organization and while rendering good seryice, is felt to be no longer necessary, and though its numbers have been largely reduced, it should be immediately absorbed into the municipal police, as has been repeatedly recommended from these headquarters.

There has been but little yellow fever among the troops of this department. In the month of May the disease made its appearance for the first time in the garrison of Santa Clara, where it was traced to a dwelling that had been used as a pest house. For the reason that our sanitary officers were kept in ignorance of its history, it had received only the regular disinfection, the owners evidently fearing that they would injure its rental value if its history were made known. This outbreak has been checked, and there are now no cases of yellow fever under treatment in the entire department.

I consider it a subject for congratulation that this scourge has not yet appeared at Cienfuegos, Matanzas or the other seaports, although this has been a wet summer, and, according to the natives, particularly favorable to the development of the germ. It is to be expected that in spite of the cleanliness which has been everywhere enforced there will be later in the season, as there were last year, a few sporadic cases, but it is hardly probable that the disease will give serious trouble this year.

The statistics obtained last year give the area of Matanzas as 3,700 square miles and of Santa Clara 9,560, making the total area of the department 13,260, slightly larger than the figures given in my last report. The population according to the census is, Matanzas 202,44 and Santa Clara 356,536, making a total of the department of 558,980 or about 58,000 more than was estimated. It was found that the ratio of whites to colored is two to one, and this is in accordance with the prediction contained in my last report.

A large number of work oxen have been imported in both of the provinces during the past year, though the number on the land is still insignificant compared with what it should be for efficient agriculture. There is no longer any need for the.gratuitous issue of rations, except to the aged infirm, and it has for some time been entirely suspended.

The remarkably favorable year for tobacco has greatly helped the laborer and small farmer of the tobacco districts of Santa Clara. The crop now being marketed amounts to 546,122 quintals of 100 pounds each, which at the low prices now offered is valued at $8,191,830, or more than double the value of the crop of last year. The benefit of this crop to the laborer without capital can not be overestimated. It requires no outlay for machinery and little for animals, and after it is gathered it gives occupation to men, women, and children in the various operations of curing, selecting, and preparing it for market.

An experiment, in a small way, has been made with much success in the tobacco region near Sagua la Grande of supplying farmers with oxen and implements at cost price and on reasonable terms of payment, and sending them out from the town to establish themselves in colonies. It was desired to locate them on land where they could eventually buy their farms at fair prices, to be fixed beforehand. It was found, how

, ever, that the owners of large tracts were generally unwilling to part with small pieces for fear that they should have the remnants on their own hands. The experiment is, however, entirely successful in its main features. The farmers are all self-supporting and many of them will anticipate the payments upon their cattle and implements. similar experiment has been made and similar results obtained at Sancti Spiritus under the supervision of Captain Fremont, Second Infantry, aided by Father Castillo, a worthy parish priest of that city: At the urgent solicitation of the civil governor of the province of Matanzas help of the same sort was extended to twenty-two families in the neighborhood of the city of Matanzas, but owing to the lateness of the season and the less advantageous situation of the farmers, the result has not been quite so satisfactory. The cattle were young and unbroken, but have materially improved in value and in several instances the purchasers will be able to anticipate payments due upon them, but for the most part the experiment has not gone far enough to justify the statement that it is entirely successful.

What has been said about small farms applies only to the tobacco country, of which little is found in the province of Matanzas. This province is specially adapted to cane, and even in localities similar in appearance to the best districts of Santa Clara, it has not yielded good results to the tobacco grower. The province of Matanzas is divided into large sugar estates and sugar-cane farms, and on account of the unusually dry summer and autumn of last year but a very small crop was raised. This province has consequently not felt the stimulus that was expected, but great additions have been made to the acreage of sugar cane, and the growing crop, with average weather, should be a remarkably good one. It is estimated that the output of sugar for the season of 1900-1901 will be double that of last year, or at least 600,000 tons.

While I feel sure that a large majority of the people of the province are in favor of independence and are impatient at what appears to them to be the slow progress that has been made in that direction, yet there are others who, while wanting annexation in its full sense or a dependency in some measure, still feel the same impatience with the existing delay. There are few, principally the owners of large sugar estates, who are urging delay and would delay indefinitely so long as the measures proposed do not lead positively toward the realization of their wishes.

The impatience alluded to above is perhaps natural. Obviously the Foraker resolution, so long as it continues in force, will be regarded by many as standing in the way of prosperity, but in my judgment it should not be repealed until the government of the island is definitely established. Meanwhile no enterprises requiring public franchises can be undertaken.

It will be observed in this connection that the greatest needs of the island are not at present for transportation, street railroads, water and light companies, but for the establishment of such trade relations with

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