~H RECEIVED IN EXCHuNGE FROM _,CRcao.h.;v. Lbsy.. __F^ \ THE ECONOMIC HISTORY OF THE HAWAIIAN ISLANDS. U. S. PARKER. C~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ I~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ -FOUNDE BY JORN I-, FCKFFI LEI THE ECONO 0IC HlISTORY OF THE~ HAWVAIIAN ISLANDS.' A DISSERTATION SUBMITTED TO THE~ FACUL~TY OF THE~ GRADUATE SCHOOL OF ARTS AND LITERATURE IN CANDIDACY FOR THE, DE~GREEl OF DOCTOR OF PHIL~OSOPIT Department of PotitiCal Economy BY 11.PARKER. QUINCY, ILLINOIS, THE MONARCH PRINTING CO. 1907 /f7 1 r 4 3 u CHAPTER I. Physical Conditions. Preliminary Remarks. In order that we may understand the great economic changes that have taken place in the Hawaiian Islands during the last hundred years, it is necessary to consider briefly those phases of their physical geography which affect industrial activity, and to get in our minds a picture of the economic condition of the people when they first came in contact with civilization a little more than a century ago. Our first two chapters, therefore, form the introduction to our study. Location and Area. The Hawaiian territory consists of a group of twenty islands lying in the North Pacific, about 2,100 miles from San Francisco, 5,700 from the Philippines, and nearly in a direct line between these two places. Only eight of the islands are of economic importance, the others being mere rocks. The main islands form a chain 390 miles in length, lying just within the tropics, and extending from northwest to southeast. The area of the eight habitable islands is given in the following table: Area of the Islands.1 A.rea ISLANDS. Area Sq. Miles. Hawaii.......................................... 4004.0 M aui.................................................... 721.9 O ahu......................................................... 597.8 Kauai....................................................... 595.4 Molokai...................................................... 257.8 L an ai........................................................... 173.6 N iihau.......................................................... 104.5 K ahoolaw e.................................................. 83.1 Total................................... 6538.1 'Census Bulletin, No. 169, p, 3. 1 2 ECONOMIC HISTORY The production of sugar is confined to the first four, which contain more than 90 per cent of the total area. On Molokai is the leper settlement, established in 1870, which contains 8,300 acres. The remainder of the island is devoted chiefly to cattle grazing 2 Lanai and Niihau are exclusively devoted to grazing, sheep being the chief animals raised. Until recently a few shepherds resided on Kahoolawe, but the grass gave out and the island was abandoned. Surface Features. Though the islands contain an area nearly as large as Connecticut and Delaware combined, only a small part is of direct economic value. The islands are of volcanic origin and have therefore very steep slopes. As a result, the soil, as it is formed by the disintegration of the lavas, is washed down and lodged on or near the shore. "The quantity of land available for any purpose is comparatively small, only the rims of the islands being used, as their interiors are generally mountainous and barren. Being of recent volcanic origin, a sufficient time has not elapsed since their formation to allow the greater portion of their area to reach a condition of fertility.'3 In 1900 only about two or three per cent of the total area was under cultivation.4 From the nature of the country, therefore, the population is confined to narrow strips along the coasts. In 1800 it was estimated that on the Island of Hawaii the inhabited portion extended only seven or eight miles from the shore.5 Most of the rivers are on the northern slopes, where the greater part of the rain falls. They have cut deep gorges, which render traveling difficult in the absence of bridges. Next to the coast are the cultivated portions, above which are pasture lands. Still higher up are timber belts, especially on the northern slopes, and beyond the timber are mountain masses, high plateaus, and broken surfaces, over which roam wild cattle. Radiating from the centres of the chief islands, and cutting across the timber belts and pasture lands below, are vast fields of barren, black lava. 2Report of Corn. of Labor, Hawaii, p. 12. 3Ibid, p. 13. 4Census Bulletin, No. 169, pp. 4, 10. 5Ogle and Aikman, p. 186. OF THE HAWAIIAN ISLANDS. 3 The coast line is generally regular, affording but few harbors. Here and there narrow beaches afforded the early voyagers convenient trading places. At many points, especially on the northeastern coasts, perpindicular cliffs, rising hundreds and even thousands of feet from the water's edge, confront the sea and form solid walls, sometimes twenty or thirty miles in length, broken only by the river gorges. In the whole district of Hamakua, in northeastern Hawaii, the sugar from the plantations is let down to the sea by cranes. Soils. The soils are all disintegrated basaltic lava and are divided into three classes, sedimentary, dark-red and light-red. The first consists of materialwashed down from the mountains and deposited in the shallow waters between the coral reefs and the ancient shore line. They are very rich, but of small extent. Taro and rice are the favorite crops for such soils. The dark-red soils are as rich as the sedimentary, at least for sugar cane. They lie immediately above the sedimentary soils, mostly on the leeward or dry side of the islands. The remaining soils are much poorer in quality, owing to the fact that the heavy rains have washed away the more soluble parts. The average yield of sugar per acre is about four tons. But it takes two years, on the average, to mature a crop,6 while in Louisiana and most other cane growing countries, only one year is required. The yield for Cuba and Porto Rico is about a ton per acre, or one-half the yield in Hawaii.7 A large part of this superiority is due, however, to greater skill in cultivation and the use of fertilizers. Rainfall. Owing to the topography of the country and the prevailing winds, there are great extremes in the amount of rainfall at different places, the greatest recorded extremes being one foot and nineteen feet per year.8 The two chief factors in determining the amount of rainfall are altitude and exposure to prevailing winds. At Honolulu the average annual rainfall is 28 inches, and at an altitude of 2,800 feet, not far from there, it is about 179 inches. The prevailing rain-bearing winds 6Summary of Commerce and Finance, July, 1901, p. 73. 7Ibid, pp. 48, 193. 8Ibid, p. 72. 4 ECONOMIC HISTORY blow from the northeast, and as they strike the highlands on that side of the islands, most of their moisture is precipitated. The average annual rainfall at low altitudes on the windward side is from 50 to 150 inches, and at high altitudes, 200 inches, while on the leeward side there is very little rain at low altitudes.9 As a result, one-half of each island is clothed in luxuriant vegetation and the other half is parched and barren. Also, most of the rain falls where it will do little good, directly, because nearly all the tillable land lies at low altitudes where there is only a comparatively light rainfall or almost none at all. Irrigation. Because of these conditions, irrigation is necessary on nearly half the land now under cultivation.0t On the Island of Hawaii most of the cane is grown without irrigation, but during the last few years severe losses have been caused by droughts. The decrease in the amount of rainfall is attributed to the destruction of forests by the cattle, both wild and tame, which roam at will, killing the young trees and the herbs that keep the ground moist." On the windward side of the islands irrigation is by gravity canals, the water being obtained from artificial reservoirs constructed among the hills on the highlands. On the leeward side there is not enough rainfall to serve the purpose, and water is obtained from wells sunk several hundred feet into porous strata. Owing to the porous nature of the lava rocks and soils, the water will not rise in the wells more than thirty or forty feet above sea level, and at higher altitudes it must be pumped. The land rises rapidly from the coast inland, the average rise being estimated at three hundred feet per mile.2 At present it is not profitable to pump the water from a greater depth than six hundred feet;" hence, irrigation by this method is confined to a narrow strip along the coast. Temperature. The temperature is as varied as the amount of rainfall, due also to two causes, wind exposure and altitude. 9Report of Hawaiian Commission, pp. 8-9. 10Census Bulletin, No. 169, pp. 15-16. "'Summary of Corn. and Finance, July, 1901, p. 80. 12Annual, 1900, p. 63. SProgress of the Beet Sugar Industry, p. 91. OF THE HAWAIIAN ISLANDS. 5 At sea level the temperature is tropical, at higher altitudes it is perpetual spring, while on the mountain tops snow may be seen any month in the year. The northeastern slopes are cooler than the southwestern, the former being exposed to the cool winds. On the whole, the northeast slopes are moist and cool and the opposite slopes dry and hot. Places at sea level with a windward exposure are sometimes five to seven degrees cooler than points at sea level in the same latitude with a leeward exposure.14 Minor causes, such as the presence or absence of forests, a broken or an even surface, also modify the temperature and help to make the climate extremely local. As in tropical regions generally, however, the temperature at any given place is quite uniform. The extremes at Honolulu during the year are about 48~ Fahrenheit and 87~ Fahrenheit. Three circumstances modify the temperature generally and make it about ten degrees cooler than in other countries in the same latitude.5 (1) Each island is small, and the cooling influence of the ocean reaches as far inland as the inhabited regions extend. (2) A branch of the Japan stream sweeps down from Behring Straits, bringing the cooling effect of the Arctic. (3) The prevailing winds, which blow from the northeast, are moist and cool. The general effect of the climate upon human energy and activity may be considered fairly favorable, on the whole. The climate is generally healthful,16 and the temperature is not so excessive as to interfere seriously with physical or mental effort. But the absence of real cold weather, especially in the inhabited portions, cannot fail to give a languidness to those born and bred in the islands which is characteristic of the people of all tropical countries, and it would of necessity be somewhat enervating to one accustomed to a northern climate. 14Summary of Commerce and Finance, July, 1901, p. 72. 151Mill, Inter. Geog., p. 661. 16Report of the Commissioner of Labor, Hawaii, p. 20; Report of the Governor of Hawaii, 1901, p. 68. 6 ECONOMIC HISTORY CHAPTER II. Economic Conditions at the Time of Discovery. Environments. The industrial activity of the native was confined by nature within very narrow limits. Having no metal, he made his edged and pointed tools out of wood, stone, or the teeth of animals. Having no vegetable fibre, such as cotton, flax or hemp, or animal fibre, such as wool, he made his cloth, ropes, cords, and fish-nets from the bark of trees. Without beasts of burden, the largest animal being the dog, he performed his work with his own hands. The limited extent of territory prevented a pastoral life, and the absence of large game, together with the smallness of the territory, rendered impossible a hunting stage. From the nature of the case, the people could be nothing else but agriculturists and fisherman. Division of employment had not arisen at the time of their first coming into contact with civilization, near the close of the eighteenth century, and when we describe the three kinds of industry existing on the islands, agriculture, manufacturing, and fishing, it is to be understood that those were simply different forms of activity of the same family. I. Agriculture. Land Tenure. The structure of Hawaiian society was much like that of the feudal system. The time and circumstances of the origin of that system in the islands are lost in obscurity, and we leave that subject to the antiquarian. When Kamehameha I succeeded in subduing the other chiefs, which he had pretty well accomplished by 1795, he rewarded his followers by grants of land. He reserved a part for his private use and divided the remainder among a few who had aided him in establishing his authority. 1 All lands were considered as belonging to the king, but that granted to the chiefs was not deemed strictly his private property. The great chiefs sub-let to other chiefs, who in turn sub-let to others, and this process was often repeated six or seven times, resulting in a very complex system. Grants from the king were made on condition that the chiefs render military service in time of war, and collect from the peo'7Jarves, History, pp. 94-169; Bingham, p. 49. OF THE HAWAIIAN ISLANDS. 7 pie the taxes or rents ordered by the king. In the olden time, before contact with the white man had stimulated the avarice of the kings, the amount of produce demanded seems to have been small and the time of collection quite regular.18 But extra tributes could be ordered at any time. No right of ownership in the soil existed, nor was the holder secure even during his lifetime, as the king granted or revoked at pleasure, and on the death of the holder the grant reverted to the king. As a rule, however, grants were confirmed to heirs.'9 The relations between the different chiefs were not well defined, but all had direct control over their tenants who actually tilled the soil.20 Thus each peasant, as we may call him, had or might have five or six lords over him, each of whom might demand as much of his time or his produce as might suit his lordship's fancy. The tenant received a grant on condition that he should work on the lord's land and pay rent in the shape of produce; but neither the number of day's work nor the amount of produce was fixed by either custom or contract.21 The tenant had no right in the soil, being a mere tenant at will. But he was not bound to the soil, being free to abandon his holdings at pleasure. There seems to have been a good derree of permanency of tenure,22 however, as there was no particular reason why the chief should dispossess the tenant, so long as he gave his master the produce demanded and performed the required services; and the tenant would have no inducement to leave his holding, unless he had reason to expect to get a better master. Owing to the simple habits of the people, even of king and chiefs, and the absence of any desire on the part of the "upper classes" to trample on those beneath them, the power to demand labor and goods without limit seems not to have resulted in actual hardship. Early voyagers and travelers universally spoke of the happy, contented appearance of the people. The work on the lord's land did not usually occupy more than one day in the week,23 and one or two 18 Wilkes, IV, pp. 34-38. '9Jarves, History, p. 94. 20S. B. Dole, in Hawaiian Hist. Soc. Papers, No. 3; Bates, pp. 137-8. 21Bingham, p. 49; Mathison, pp. 449-50; The Spectator, Vol. 1, pp. 56-57. 22C. J. Lyons, in Thc Islander, July 30, 1875. 23Mathison, pp. 450-51. 8 ECONOMIC HISTORY hours a day would suffice to keep the tenant's own little patch in good condition. And the common custom of going from place to place with the whole family to visit for weeks among friends,24 a custom yet prevailing in country districts,25 is good evidence that the lot of the common native was not a hard one. While this legal insecurity of time and property did not actually result in hardship, should any disturbing element come in, such as desire for wealth among the chiefs,it is easy toimagine what might happen. Captain Portlock, in 1786, noted an incident that will illustrate the point.26 A common native brought to the ship in his canoe a load of produce to trade with the voyagers. When he was about to depart, a chief demanded of him all he had obtained, which was at once given up. Portlock remonstrated with the king, but was informed that what had been done was justified by custom. Products and Methods of Cultivation. The chief cultivated plants were taro, sweet potatoes, of which there were about fifty varieties, bananas, yams, sug ar-cane, calabash-gourds, the paper-mulberry tree for its bark, and the Awa for its narcotic roots. The taro was of the greatest importance, and potatoes occupied the second place, the others being minor crops. They were all found wild also, as well as many other plants, including bread-fruit, cocoanut, and arrow-root. The taro is a very nutritive tuber, and was, as it still is, the great staple food of the natives,27 There are some twenty-eight varieties, which may be divided into two groups, the dry-land and the wet-land, the latter being by far the most important. The method of cultivating the wet-land taro is so peculiar and represents such a characteristic phase of Hawaiian life,both ancient and modern, that it is worthy of special consideration.28 A bed is hollowed out and the dirt thrown up around the edge so as to make an embankment three or four feet high on the inside, 24Coan, p. 58. 25Stevenson and Oleson, p. 21. 26 Voyage, p. 310. 27Stewart, p. 104; Townsend, p. 199. Musick, p. 68. 280n methods of cultivation see Corney, p. 108; Mathison, pp. 374-379; Stewart, p. 111; Vancouver, I,, pp. 163-171; Portlock, p. 191; Bates, p. 122; Byron, pp. 106-7. OF THE HAWAIIAN ISLANDS. 9 and the bottom and sides are beaten while moist to make them water-tight. A thin layer of loose dirt and grass is spread over the bottom, the suckers planted regularly in rows, and then the water is admitted through the "gateway." The wet-land taro is a water plant, the leaves floating on top of the water. A bed once made is a permanent thing. As a mature plant is pulled up a young one is put in its place. It takes from nine to fifteen months for a plant to mature. The beds vary in size from forty square feet to two or three acres, the larger ones having been owned by the chiefs. The beds 'of the different owners of the village usually lay side by side, the common embankment, often a stone wall, serving for both boundary and walk. The water was supplied by irrigating canals, often built of stone and sometimes miles in length. A canal usually supplied a whole village, each owner of a patch having a little ditch leading from the common canal. There were certain rules and regulations quite well established, regarding the opening and shutting the water-gates and drawing off the water.* These canals and ditches and little square ponds of vegetation were great curiosities to the early travelers, and the most curious spectacle of all was to see the natives tending their taro patches, wading up to their waists in mud and water. The early visitors bestowed much praise upon the native for his skill and industry in building his canals, ditches and taro beds. But it is to be observed that this labor did not have to be repeated every year. A bed and the necessary canals and ditches would last for generations with very little repairs. Also the plant is very nutritious and but little labor is necessary to keep in good condition a patch large enough to supply a family. Cooking. The method of cooking the taro was simple but effective. A hole was dug in the ground and lined with stones; a fire was built, and when the stones were hot, the taro was wrapped in leaves or native cloth to keep it clean, and put in the "oven." Then the hot stones were rolled over it, water was thrown on, and the whole was covered with earth to hold the heat and steam. This "oven" was also used for cooking meat and other kinds of food. *The native word for law is "Kianawai," "concerning the water." 10 ECONOMIC HISTORY When the taro was sufficiently cooked it was taken out and beaten fine and mixed with water. This paste was allowed to stand a few days until it soured, when it was considered ready to eat. At meal time the family gathered around the big wooden bowl of sour paste, called poi, each one sitting cross-legged on the ground and helping himself from the common dish, thumb and fingers serving for knife, fork and spoon. The poi was occasionally seasoned with a bite of raw fish dipped in salt. The pet pig also helped himself from the common dish. Animals. The native animals were small, and there were but few kinds. The bat, a lizard, an animal between a rat and a mouse, fowls, the dog, and a small species of hog constitute the list.29 The fowls, dog, and hog were domesticated and all used as food. Cook noted that hogs were very plentiful. But if they were used to any great extent by the common people before the islands were discovered by Europeans, they soon ceased to be a common article of diet among the masses. Probably it was too easy for king and chiefs to gather up the hogs and sell them to the traders. Fish Ponds. The chief animal food was fish, which was caught in the open sea, in small lakes or from artificial ponds.30 Each holding had its fish pond, either natural or artificial. The native prized his fish pond as second in value only to his taro patch, and the fish were often tended with considerable care. The largest artificial ponds were along the shore, and were made by simply enclosing a portion of the sea with a wall of coral. These ranged from one acre to one hundred acres in extent, the larger ones belonging to the king or the chiefs. The inland ponds were made much like taro beds. In fact, one was sometimes converted into the other. II. Handicrafts. Articles In Common Use. We have already observed that nature set narrow bounds to industry. The raw materials were wood, stone, the bark and leaves of trees, gourds, bone, the teeth of animals and the feathers of birds. The art of tanning 29Cook, II, pp. 842-45; Anderson, p. 34; Annual, 1888, p. 52. 30Bates, pp. 114-115; Slewart, p. 110; Mathison, pp. 375-416. OFi THE HAWAIIAN ISLANDS. 11 the skins of animals does not seem to have been known. Out of these materials various articles were made, most of them of a simple pattern.3' The following list is not intended to be exhaustive, but representative of what was in common use. About the only implement of husbandry was a pointed stick. Fishing required a little more extensive apparatus, andincluded hooks of teeth, lines and nets made of the tough inner bark of trees twisted into cords, and canoes. The canoes were usually about twenty-four feet long, but some were fifty or one hundred feet in length. The bottom part consisted of one piece hewed out of a log. As the sides needed to be quite high in order to render the canoes safe for use on the sea, boards were sewed to the upper edges and brought together at each end. Canoes were also used in war, two or three often being lashed together and provided with a small sail. Their weapons of war were wooden spears and daggers, sometimes pointed with a shark's tooth. Articles for household use were also few and simple. Wooden bowls, calabashes made of the dry fruit of the calabash or gourdplant, and of various shapes and sizes, served for holding poi, water, and other food, and for drinking cups. A fish basket, knives of hard wood, or shark's teeth, or a shell for cutting or scraping, mats made of leaves or bark-cloth for the floor and for beds and bed-clothes, complete the list of common household furniture and utensils. The cups, bowls and calabashes were often painted with considerable taste, the coloring used being obtained from berries and various roots and herbs.32 The Hawaiians had few occasions for using lights, but when they were needed they were made from nuts and rushes. The nuts were baked and then strung on a rush. Their methods of making cloth deserves separate treatment. Cloth Making. Cloth was made from the tough inner bark of trees, the paper-mulberry, cultivated for the purpose, being the best.33 The bark was cut into strips, soaked in water, spread out on a hard, smooth surface, the edges overlapping a little, and beaten with a stick. In order to give different appearances to 31 Cook, II, pp. 845-50; Blackman, pp. 54-55. 3 Cook, II, p. 847. 330n method of manufacture. see Annual, 1896, pp. 176-86; Stewart, pp. 114; Bates, pp. 279-80. 12 ECONOMIC HISTORY the various kinds of cloth, the sticks were either smooth or variously notched and carved. Sometimes arrow-root was laid crosswise and beaten into the cloth to make it stronger. There were a number of varieties of cloth, kapa, as it was called, which may be divided into two classes, one of a light texture for wearing on the person and for other uses, the other coarse and heavy, for mats, covers for dishes, beds and bed-clothes. A bed consisted of several layers of thick mats The cloth was sometimes painted or stained with the same kind of coloring matter as that used in painting bowls and cups. In this art much skill was sometimes displayed. Cook says that "the regularity of figures and stripes is truly surprising.34 As one might expect, this cloth was not very durable; it would last but a few days or weeks, if worn constantly. Cloth making was the work of the women, and constituted their most arduous household task. There was no sewing or tailoring, the cloth being simply wrapped around the body something after the manner of the Roman toga. But ordinarily, the only "clothing"worn was a narrow girdle, dress being merely a matter of ornament. Feather Work. The highest development of art among the ancient Hawaiians is represented by their feather work,35 which shows a taste and skill worthy of a people well advanced in civilization. There are but few specimens of this work remaining. They include strings of feathers worn in the hair or around the neck, plumes, helmets, cloaks, capes, images of the Gods, and flly-flaps, frequently with a handle of bone from the body of an enemy slain in battle. The cloaks, capes and helmets were worn only by the kings and chiefs and on special occasions. The helmet was both for ornament and for protection in battle, the groundwork being of wood. The groundwork of the other garments was kapa, each tiny feather being fastened on with bark thread. This work was done by those trained for the purpose, and the birds were caught by trained bird catchers. A cloak or cape was a costly affair, as the feathers used were very small, and each bird furnished but a few that were wanted. Mrs Judd, 34 Voyages, II., p. 847. 3aSee W. F. Bingham, Hawaiian Feather Work; Annual, 1895, pp. 101-111. OF THE HAWAIIAN ISLANDS. 13 writing in 1828, states that the time, labor and feathers, (each feather being equivalent to twenty cents in the tax system then prevailing), employed in making a cloak for the young king was estimated as amounting to hundreds of thousands of dollars.36 These feather garments were exceedingly brilliant, the favorite colors being red, yellow, green, black and white. Houses. The Hawaiian house consisted of a bamboo framework thatched with grass, and might easily have been mistaken for a hayrick.37 The hut of the common native was a small affair, about ten feet long and eight feet wide, with a hole in one end to crawl through. The hut served chiefly as a store room and a place to sleep in on cool nights, as the common people lived most of the time out of doors. The "palaces" of the kings and chiefs were built on the same plan as that of the huts of the common people, but were much larger, andrude attempts at ornamentation were usually made by using different colored grasses. Houses were sometimes built by a class of men who were specialists in that work, this being the third instance of division of occupation, bird catching and making feather garments being the other two exceptions to the general rule. Salt Making. Salt was with them a necessary article of food, and was obtained by evaporating sea water, or the brackish water of inland lakes. The evaporating "pans" were usually simply trenches dug in the earth and lined with clay, about six or eight feet square and a few inches deep, and so arranged that the water could be let in easily.38 Place In the Scale of Development. Such was the economic and social condition of this interesting and unique island people when civilization found them in their isolated home. It is not easy to classify a semi-barbarous people and place them just where they belong in the scale of development, and it is especially difficult to do so with the Hawaiians since they could not pass through the various stages usually recognized as marking the progress of peoples. For the sake of classification, however, we may place them somewhere between the semi-barbar36Sketches, p. 28. *7Stewart, p, 235; Bingham, pp. 115-116; Byron, p. 107. 3"Cook, II,, p. 1023. 14 ECONOMIC HISTORY ous and semi-civilized states. The environment was not very favorable to high development. The poverty of material to work with, the warm, even climate, the fertility of the small portion of the soil that needed to be cultivated, the great fruitfulnesss of the taro, all tended to make the native indolent and satisfied with few things. Life was not a struggle for existence, hence, the greatest stimulus to advancement was absent. It will be interesting to study the effect upon this simple people of sudden contact with civilization. OF THE HAWAIIAN ISLANDS. 15 CHAPTER III. The Fur Traders of the Northwest and the Sandal Wood Trade. Economic Factors. There are six great factors in the economic history of the Hawaiian Islands since their discovery by the white man,(l) the FurTrade between the Northwest coast of North America and China, (2) the Sandal Wood Trade, (3) the Missionaries, (4) the Whaling Fleet, (5) the Settlement of California by Americans, and (6) the Reciprocity Treaty between the United States and Hawaii. The fur trade began in 1786 and was a considerable factor for about half a century. Its effects were soon overshadowed, however, by the sandal wood trade, which lasted from about 1800 to 1839. On the heels of the sandal wood trade came two other forces, the missionaries and the whaling fleet, both of which entered the field in 1820. The latter came to an end in 1870, but the influence of the missionaries still continues, though they themselves as a distinct organization have been withdrawn. And it is the one factor that has steadily acted in one direction, uplifting and civilizing the nation; the other forces have pulled up and down, sometimes elevating, but more often cursing the masses of the natives. The settlement of California began in 1849, and in 1876 the influence it had upon the islands was intensified by the reciprocity treaty by which Hawaiian sugar was admitted free into the United States. Periods of History. It will be observed that these factors usually overlap, and one, the missionaries, has affected allperiods from 1820 to the present time. While the strength of one force is increasing, another is declining; the two forces may oppose each other or the new may intensify the old. Hence it is not easy to divide the industrial history of Hawaii into periods and give to each a definite boundary. But if we seize upon the salient features, neglecting the missionaries and combining two other factors, we may distinguish four periods, (1) the Fur and 16 ECONOMIC HISTORY Sandal Wood Trade, (2) the Whaling Fleet, (3) the Settlement of California, and (4) the Reciprocity Treaty. But for obvious reasons, we shall consider the factors rather than the periods of history, though we shall try to keep the latter in mind. I. The Fur Trade. Origin. The knowledge brought home to England by the companions of Captain Cook suggested to the commercial world the idea of establishing the fur trade between the northwest coast of North America and China. Some half dozen vessels were sent to the northwest coast by English merchants in India, and in 1786 Captains Portlock and Dixon were sent by an English company organized the year before to trade in furs,39 American merchants were soon in the field, and Hawaii became a halfway station for obtaining provisions. Nature and Extent. The extent of this trade cannot be told with exactness, because no reliable figures are obtainable before 1840, when the Hawaiian government began to assume a modern form. But it is probable that two or three ships touched at the islands each year. The provisions obtained were fowls, fish, vegetables, fruit, and especially hogs.40 The chief article sought by the natives was iron. Cook found among their implements one made of a piece of hoop-iron fastened to a wooden handle, and another which looked like the point of a sword.4' How they got the iron is not known. They may have got it from some earlier Spanish voyager, or, as the natives say, from Japan. But it was of great economic advantage to the early traders that the natives knew the utility of iron without knowing its commercial value. The natives eagerly offered their services in carrying fresh water from the inland springs or gave large quantities of produce for a few nails or bits of iron. Portlock gave a ten-penny nail for each large calabash of water.4 A shipload of provisons could be obtained at a mere nominal cost. Later, rum, cloth, hardware and other European articles were 39Portlock, pp. 2-3; Annual, 1890, p. 35. 4OPorllock, pp. 63-69-77-87-91; AMearss, p. 350-56. 41Cook, II, p. 848. 42 Voyae, p. 73. OF THE HAWAIIAN ISLANDS1 17 in demand, and while the wars were raging between Kamehameha I and the other chiefs, fire-arms and amunition were especially sought for.43 Effects Upon the Native. Though this early commerce was not extensive, its effects were marked. The early voyagers introduced sheep, goats, cattle, horses, a better breed of hogs, and fowls of European stock. Mosquitoes were also brought at a later date, and the taro patches made excellent breeding-places. The horses were used only for riding, and the cattle were not used at all for several years. They were allowed to run wild and they became so numerous as to damage the forests. In 1822 the only tame cattle were owned by a Spanish resident.44 Sheep and goats were utilized to some extent, and in 1809 formed an article of commerce.45 The effects upon the chiefs were to stimulate in them a desire for European dress and finery and a taste for liquor, so that drunkenness became one of the common habits, especially among the "nobility. " The desires of king and chiefs were satisfied at the expense of the common native, and at an early day we get a glimpse of what the result will be. In 1789 Lieutenant Meares writes that the king sent orders "for every one who had an hog to bring it immediately to the village, ona pain of death."46 The only advantage that the common native derived from this trade was that he got a little iron for instruments with which to dig the harder for his master. II. The Sandal Wood Trade. Origin. The sandal wood trade was a result of the fur trade. Captain Kendrick, an American fur trader, learned that sandal wood existed on the islands in considerable quantities, and he conceived the idea that something might be made by taking the wood to Canton. In 1792 he left three men on the islands to gather wood, but the trade did not amount to much until about 1800.47 43 Vancouver, I, pp. 1,6 1, p.p. 115; Meares, p. 352. 4 4.a/atizison, pp. 425-2'7. 4 5 Caripbell, p. 121. 4'JMeares, p. 353. Aim Vancouver, I, p. 172. 18.xJECONOMIC HISTORY Extent. We have no means of knowingaccurately the value or extent of this trade, but various attempts have been made to estimate it roughly. During the period of its greatest prosperity, from about 1810 to 1820, the value of the exports amounted to $300,000 or $400,000 a year.48 In the early '20's, the wood became scarce and the exports declined,49 In 1823 Stewart estimated that the total value of the trade of the islands, including produce sold to the ships, was only $100,000 per year."0 Anderson estimated that the total value of the sandal wood exported during the whole period of the trade was probably $1,000,000.51 The value of the exports for the last four year's of the trade, 1836-9, was $65,000.52 Method of Collecting. The method of collecting the wood was simple, but it bore hard on the natives. The king and chiefs, who owned the timber lands, gave orders to their vassals to go into the forests and bring in a certain quantity. A pioneer merchant residing in Honolulu writes in his journal, January 2, 1827, that the people of the village assembled to receive their orders, the men to go the mountains and bring in half a picul"5 of sandal wood apiece, and the women to bring: in mats, or other articles. If any man brought more than half a picul, he might have half the extra amount. Anyone who wished might pay four dollars instead of getting the wood, and the women might pay a dollar instead of bringing mats, etc.54 The wood was placed in storehouses near the shore, and small brigs and schooners took it to the chief ports. Effects. 1. Avarice of Chiefs Excited. The effects of the sandal wood trade, together with the fur trade, may easily be imagined. The avarice of man is easily excited, especially when he can satisfy his desires by the labor of others. Silks, satins, nankeen, broadcloth, chinaware, horses, all sorts of com48Jarves, HIistory, p. 100; Mathison, p. 458. J4arvus, 'isf/stoiy, p. 117. 5O'Residence, p, 122. 5' /1awaiiau Islands, p. 251. 52.4nnual, 1896, p. 91. '53A picul is a weight of 1333 pounds. 54 IAn' al, 1901, p, 76. OF THE HAWAIIAN ISLANDS. 19 modities that appealed to the fancy of king or chief, were in great demand.55 The men often had their suits made to order in Canton. Immense warehouses were built in which to store goods, where they sometimes rotted before they could be used.56 Some of the chiefs who had an eye to business accumulated considerablefortunes. Governor Coxewas considered worth $20,000 or $30,000, gained from the sandal wood trade. But many chiefs plunged into debt, and their creditors, the foreign merchants, found much difficulty in collecting their dues.57 2. Burdens of Common Native Increased. The effect upon the vassal was what might have been expected. The fur trade robbed him of his produce, and the sandal wood trade robbed him of his time and inflicted upon him much suffering. At any moment he might be called upon to go to the mountains to remain for months at a time cutting sandal wood, with no food or shelter save that afforded by the forest.58 Hundreds or even thousands of people might be seen going to the mountains or returning with the wood on their backs. Whole districts were sometimes temporarily depopulated, the people being sent to the mountains en masse'9 If a man refused to obey orders, his house was burned, and if he still remained obstinate, he lost his little piece of land. The hardship newly imposed upon the native was not that of severe and continued toil, for he was by no means kept at work all the time, but he was not used to hard work, and the cold nights of the mountains, the difficulty of getting food while hunting for wood among the rocks, ledg es, and mountain sides, and the lack of shelter would have been a severe test for any man, even one used to a cold climate and inured to toil. 3. Sandal Wood Extirpated. We are not surprised to learn that in the early twenties the wood began to be scarce and hard to find, and that by 1840 it was almost extirpated.60 Constant cutting of the old trees and wanton destruction of young 55Stewart, Residence, p. 105; Maltison, pp. 373-408. 56Bingham, p. 50; Campbell, pp. 129-139. 57Annual, 1901, pp. 78-79. 58Judd, p. 21. 5 Ellis, Journal of a Tour, p. 215. 60 Wilkes, IV, p. 37. ECONOMIC HISSTORY ones by the natives, in order to put an end to their hardships, could have no other result The trees have grown up again to some extent, but not in sufficient numbers to justify a revival of the trade,61 4. It Brought Foreign Residents. The fur trade brought Europeans to the islands as temporary visitors only; the sandal wood trade introduced a foreign element as permanent residents and set in motion some of the forces which were to transform the islands and give them a European aspect. In 1822 about sixty persons were present at a Fourth of July celebration at Honolulu.62 In 1827 there were four American mercantile houses at the capital offering for sale such articles as are usually found in a "general merchandise" store in America.63 Some fifteen or twenty foreigners had found favor with the king and received grants of land,64 the entering wedge to the subsequent foreign ownership of the soil. 5. Changes in Habits and Customs. The presence of so many foreigners residing among them could not fail to affect the habits and customs of the people. The effects were brought about chiefly because of man's imitative instinct. The majority of the foreigners made no effort to improve the native in any way, and some even actively opposed the few who occasionally instructed the natives in some useful art, fearing that he would become less dependent upon foreign intelligene.65 But a savage or semi-civilized man readily learns some things by imitation. We have already noted that the chiefs began to use foreign articles of dress and furniture and to drink the white man's beverage. As yet, however, the influence had not reached the common people to any great extent, partly because they were not in such close contact with the foreigner as were the king and chiefs, and partly because they were not able to buy the new wares. But a few began to imitate the European style of dress as best their taste and means would allow, and all sorts of odd mixtures 6 Bulletin, No. 95, De~partment of Agriculture, p. 30. 62Mathison, p. 389. 3"Stewart, p. 122. 64Ibid, p. 123. G5Campbell, p. 140; Jarves, -istory, p. 95. OF THE HAWAIIAN ISLANDS. 21 of native and foreign costumes were seen. The usual native dress was a narrow girdle around the loins. To this, one would add a shirt, another a pair of trousers, another a hat or a pair of boots, and even an umbrella occasionally served the purpose." 6. Money Introduced. Some of the other effects of the forces at work during this early period were less striking in appearance but as far-reaching in consequence. One of these effects was the introduction of money. As early as 1804 the king began to use money in his commercial transactions.67 By 1822 it was a circulating medium,68 but its chief function was as a standard of value, sandal wood being the medium more commonly used,69 especially when large sums were involved. The debts of the chiefs, for example, were reckoned in terms of money, but merchants actually received sandal wood. The use of money was confined to the "upper classes," for at this time the common people had little to do with commercial transactions. They simply turned their products over to their masters. It was not till 1840 that the common people began to use money, when Captain Wilkes employed many natives in his scientific explorations and paid them in money.70 About that time, also, the bands of feudalism were breaking, and the common man became master of his time and property, and he began to take some little part in the business affairs of the country besides that of a mere pack horse. 7. Changes in Revenue. Another important result of the commercial phase of the period was a change in the king's revenue. In ancient times the revenue of the king consisted in produce from the lands held by the chiefs and from his private estates. This source of revenue was continued, but others were added.7' When markets came into being in the islands the king was not slow to take advantage of the situation He sold his produce to the merchants, as well as his sandal wood, often re66Judd, p. 5. ~67Jarves, History, p. 100. 68Campbell, p. 68; Mathison, p. 453. 69Stewart, p. 122. 70 Wiles, III, p. 386; IV, p. 116; Coan, pp. 118-19. 71See Jac'ves, Histoiry, pp. 100-104. Corney, pp. 2-96; IMalhison, p. 466. 22 ECONOMIC HISTORY ceiving European or American goods in exchange, which he sold, both at wholesale and retail, thus gaining the profits of a merchant. In 1816 an entirely new revenue was established, port dues, which later expanded into a general tariff system. This change is important not simply because it was the beginning of a system of taxation characteristic of a civilized community, nor simply because the tax was levied upon foreign merchants instead of upon the natives: but it is important chiefly because it helped to render possible at a later date the breakdown of the feudal system. When thekinghad solid and substantial revenues from the tariff and port charges, he would more readily consider the possible advantages of relieving the masses from the burdens of the old feudal levy. On the whole, this period was fruitful of small beginnings of several important changes. OF TIHE HAWAIIAN ISLANDS. 23 CHAPTER IV. The Missionaries. Object of Their Labors. In 1820 there landed on Hawaiian soil two groups of men, the American Missionaries and the Whalers. Two forces were introduced which in some respects worked toward the same end, but in others they were opposing factors. The main object of the missionaries was to convert the natives to Christianity, and their greatest efforts were directed towards that end. They did not, however, lose sight of the fact that the native needed instruction in the arts of civilized life. The instructions to the little band of missionaries, prepared by the Prudential Committee of the American Board of Foreign Missions, left no doubt in the minds of the missionaries as to what they were expected to do. "You are to aim," say the instructions, "at nothing short of covering these islands with fruitful fields and pleasant dwellings and schools and churches, and raising up the whole people to an elevated state of Christian civilization.72 In order to aid in carrying out this lofty ideal, there were sent out with the first missionary band of twentytwo persons, a farmer, a mechanic, a doctor, a school master and a printer.73 Efforts. When they arrived on their field of action they did not forget their instructions. A joint letter of the missionaries to the Misszonary Herald, 1834, states that they are called upon by the natives for help in secular affairs to such an extent that it interferes with their regularwork of teaching and preaching.74 A writer to the same paper two years later says that "The trowel, turning-lathe, saw and plane began to be used to improve their buildings and furniture.""75 Jarves says that quite a num7 2Annual, 1895, p. 91. 73MiSssionary Herald, XVI, p. 569. 7 M4issionary Herald, XXX, pp. 338-39. 7 'bid, XXXII, p. 354. ECONOMIC HISTORY ber had been taught trades, including masons, printers, bookbinders, tailors, engravers, carpenters, etc., and that the missionaries were indefatigable in their efforts to give industrial training.7 Bingham bears testimony that the introduction of the plow, the domestic wheel and loom, the scissors and needle, the different processes of house building, the manufacture of sugar, the culture of the cane and mulberry, engraving, printing, etc., all received the attention and encouragement of the missiona ries. Call for Help. The missionaries felt that there was more to be done than they could do, and in 1836 they addressed a memorial to the American Board asking that forty-six industrial workers be sent and suggesting that a separate society be organized in America to conduct the industrial branch of the work. The chiefs also sent a memorial stating the kind of teachers needed. They would specify "a carpenter, tailor, mason, shoemaker, wheelwright, paper maker, type founder, agriculturalists skilled in raising sugar cane, cotton and silk, and in making sugar, cloth manufacturing, and makers of machinery to work on a large scale, and a teacher of the chiefs in what pertains to land, according to the practice in enlightened countries, and if there be any other teacher that could be serviceable in these matters, such teacher also."78 But for reasons best known to themselves, the American Board did not comply with the request of either memorial. Industrial Schools. As a final proof that the missionaries did not neglect the industrial side of their work, we may mention the industrial schools established by their efforts. Besides the regular system of public instruction which, in 1830, included nine hundred schools taught by native teachers, with 44,895 pupils,79 the missionaries established and conducted a number of higher schools in which industrial training was given.80 Agriculture, butter-making, printing, book binding, and other arts 7GHistory, p. 205. 77Residence, p. 489. 7]Biiigchacm, pp. 489-96. 79Jarves, History, p. 146. 80Ibid, p. 204; Cheever, Life, pp. 105-6; Annual, 1895. OF THE HAWAIIAN ISLANDS. 25 were taught the boys, and the girls received instructions in housekeeping, sewing, knitting and spinning. 'The first seminary in which industrial training was given was opened in 1831. Whether consciously or unconsciously, the missionaries adopted the only method by which a people low in the scale of civilization can be raised to a higher level. Exercise, effort, is the only means of development, mental, moral or physical. In order to stimulate a man to greater effort, his wants must be increased, and a means must be provided for satisfying them. The wants of the native were increased by both precept and example, and industrial training was the means by which those wants could be satisfied. It is the method of Booker T. Washington, and itisthemethodthatmust beadopted in our slums if we would remove these black spots on our civilization. Obstacles. If the missionaries were not wholly successful in at once covering the islands with fruitful fields and beautiful dwellings, we need not be surprised, for the obstacles they had to encounter were numerous and great. Though the climate is not extremely enervating, it does not spur to action; from the nature of the crop and the method of agriculture, but little labor was needed to provide food; the traders and 'other white residents opposed the missionaries, fearing that if the natives became educated their own mental superiority would be gone.8 In the early thirties a temporary discouragement beset themthe king fell among evil counselors and mary of the schools were closed, and the salutary laws against vice were repealed. In 1834 the king reformed and things were righted.82 But the greatest obstacle of all was the feudal system. The whole structure of society was against them, and, as a matter of course, they dared not attack that system for fear of being driven from the kingdom. When a man knows that the fruits of his labor may be taken from him at any moment, and that any sign of increasing prosperity will be sure to result in an increase of his taxes, any efforts to induce him to be thrifty and accumulate property must, to a large extent, be abortive. 81Jarves, History, pp. 113-115; Mathison, p. 372; Townsend, p. 195. 82Jarves, History, pp. 149-50. 2b ECONOMIC HISTORY Results. 1. Changes in Habits and Customs. Though opposed by these powerful forces, the labors of the missionaries in time produced some economic and social results of great importance. Under the stimulus of both precept and example, the common natives began to imitate the whites and the chiefs, and to acquire the outward habits and customs of civilized life. Wants were increased, and thus was touched the mainspring of progress. But the change was slow. It was comparatively easy to teach the native to use the hoe and spade and other simple implements of husbandry, for he could readily see the advantage in using them. By 1840 agricultural implements of European or American make were in general use.83 But clothing long continued to be regarded as a matter of adornment, to be worn only on special occasions.84 In 1840 the women in the towns had generally adopted European dress, usually a loose wrapper, but the men ordinarily appeared in native nakedness. By 1875 the men in the cities and the women in the country had adopted European dress; but the men in the rural districts yet clung to old habits. They would put on clothes when they went to town, but throw them aside as soon as they got home.85.The exchange of the new furniture for the old was yet more slow, and even today the majority of the natives who have furniture, such as chairs, bedsteads, tables, etc., keep them in their parlors for show rather than for daily use.86 The special advantages of a modern house did not appeal to the native with sufficient strength to induce him to abandon his grass hut, even after feudalism had passed away and he was master of his time and property. Ia 1840, however, before this had been completed, some imp rovement had taken place in native dwellings in various parts of the islands, but in general there had been little change.87 In 1876 the native grass hut was a conspicuous object in Honolulu, 88 and it has not been wholly ban83Sir G. Simpson, II, p. 121. 841bid, pp. 44-50; Jarves, History, p. 231. 85aBliss, pp. 81-2. 86Stevenson and Oleson, p. 21. 87 Wilkes, IV, pp. 67-75-80-92-96. 88 Wheatham, p. 82. OF THE HAWAIIAN ISLANDS. 27 ished from the islands at the present day.89 The general condition of the native at the present time we shall consider in another chapter. 2. Division of Labor. Along with these changes in habits and customs went another, division of labor, which has been one of the great factors in the progress of civilization generally, and even with the simple conditions existing in Hawaii, has been and is now of considerable importance. Some of the natives learned to pursue the various trades that are necessary even in an agricultural community of today, and those who remained in agriculture found it to their advantage to exchange their produce for what clothing, implements and furniture they desired. They continued to make their old calabashes and simple articles of that kind, and as late as 1854 native kapa was "still used extensively in remote parts of the group,""90 But by 1875 their old handicrafts were nearly obsolete.9' 3. Overthrow of Feudalism. The greatest ecomomic effect of the labor of the missionaries was in helping to overthrow the feudal system. But other forces were aiding in the process, and we can best consider this phase of missionary labor after we have discussed those other forces. 89Stevenson and Oleson, p. 21. 90Bales, p. 279. 91 Wheatham, p. 37. 28 ECONOMIC HISTORY CHAPTER I. The Whaling Fleet. (1820-60). Complex Character of the Period. The forty years from 1820 to 1860 is the most complex period of Hawaiian economic history. Though some important changes had taken place before 1820, the general situation is easy to grasp; a few chiefs have some of the external forms of civilized life, the common native has new burdens, the king has new revenue, and some are learning to use money. After 1860 the all-absorbing interest is sugar. But during the period we are about to study, changes are going on that are to give an entirely new face to Hawaiian life and Hawaiian industry. The foreigners become predominant in industrial affairs; commerce becomes the chief thing in business circles, but depending upon it are important grazing interests. The beginning of the period is complicated by the old forces, the sandal wood trade and the fur trade from the northwest, and the closing years are marked by new forces that are to revolutionize industry, while the central portion of the period is characterized by the great upheaval that overthrew the feudal system. The Whaling Fleet is the predominant factor from the industrial point of view, while the missionaries were active in bringing about general social changes. The merchant vessels, including the fur traders, continued to be a considerable factor throughout the period. From 1824 to 1852 as many as 1,992 merchant vessels touched at Honolulu, or about two-thirds as many as there were of whaling vess.t92 The Whaling Grounds. A glance at the map will show the importance of the islands to the whale ships of the North Pacific. There were three whaling grounds; one on the equator, one near Japan, and one near the Russian settlements.93 The islands afford a convenient halting place in going from one 92Bates, p. 33. 93Sir G. Simpson, II, p. 137. OF THE HAWAIIAN ISLANDS. 29 ground to another, but they were of special advantage to the North Pacific Squadron, which cruised in the northern whaling grounds, and which made the islands their base of supplies94 The weary sailors, after a six months' cruise, could run into port, send their oil and bone in one or two ships to Atlantic ports by way of Cape Horn, repair their vessels and take in water and provisions for another cruise. Later, duringur the forties, the carryirng trade began to be seperated from the catching of the whales,95 and by 1850 Honolulu became a regular port of transshipment of whale products. Magnitude of the Whale Fisheries. This new force that entered the industrial life of Hawaii, unlike most economic forces, came suddenly and with great energy, Exact figures are not obtainable for all the ports untilafter 1850, as no record of ship entries was kept except at Honolulu. From 1824 to 1852, over 2,800 whale ships entered Honolulu, being an average of one hun:dred a year. There were not that many different ships, as each one usually entered and refitted twice a year.96 It is estimated that about as many entered the other ports,"7 mraking a total of about two hundred a year. In 1842 the British whale ship;s in the Pacific are said to have numbered seventy, and the Americans over four hundred, and the number of men 2,100 an d 12,000 respectively.98 From 1851 to 1860 the total number of whale ship entries at all the ports was 4,440, or an average of 440 a year 9" Many of the ships, however, touched at more than one port, and these figures lose part of their significance. The London Post, 1854, speaking of the whaling interests, puts the number of men in the American fleet at 20,,?00.100 But this probably includes the American vessels on all three of the whali?,g grounds of the Pacific, as the four hundred vessels referred to in 1842 doubtless do. And it will be remembered that only the 94Judd, p. 31, Hopkins, p. 401. 95Sir G. Simpson, II, 138. 96Bates, pp. 33-34. 97Alex Simpson, p. 109; The Friend, May, 1852, p. 8. 98Alex Simpson, p. 115. 99 U. S. Bureau of Satistics, Qr. Report, 1885-6, No. 2, p. 414. 100 The Friend, August, 1855. ECONOMIC HISTORY whalers in the northern grounds used IHaTaii as their base of supplies. The safest way to get at the number of men supplied with provisions and clothing at Hawaiian ports is to estimate from ship entries. Each vessel carried from thirty tthihrty-five men.101 If we make no allowance for any ships touching twice in refitting, we get between 13,000 and 16,000 as the number of men. Dividing by two, since each vessel refitted twice a year, we get as a final result 7,000 or 8,000, which represents the number of men supplied at the islands. This is probably a little too large, but after making an allowance for the fact that many ships touched at more than one port, it is yet clear that there were enough sailors to create a very large market in so small a country. The totalpopula ion of the islands ia 1853 was 73,138. Effects. 1. Grazing Industry Increased. The presence of such a market could not fail to produce momentous results. Cattle raising received a great stimulus. Mexican cowboys were imported to tend the herds, and we have a period of "Spanish influence."'02 rThe total number of cattle on the islands in 1852 was estimated at 40,000,13 In 1851 "fairly good cattle" were sold for $2 a head, and boiling works were erected to "try out" cattle for their tallow.~14 Hides became a considerable article of export, the annual values of the exports from 183o to 1840 being estimated at $11,000.105 Sheep, goats and hogs also became plentiful. One spectator says that thirty hogs could be bought for $75.106 The native industry supplied only fresh meat for home consumption and for the ships. A glance at the annual reports of the United States Bureau of Statistics on Commerce and Navigation shows that large quantities of salt meats were shipped from the United States to Hawaii. The Friend, for November, 1857, near the close of the period, states that "if packers succeed one or two years more as they have succeeded, Hawaiian salted beef 1o The Friend, May, 1852. 102 W. D. Alexander, in Hawaiian His. Soc. Papers, No. 1. 103 The Friend, June, 1852, p. 9. 104Annual, 1895, pp. 98-99. L05Annual, 1896, p. 91. 106Mrs. Parker, p. 11. OF THE HAWAIIAN ISLANDS. 31 and even pork will become establised in the market." This certainly shows a lack of enterprise. One would think that instead of "trying out" cattle for tallow, or selling them at $2 a head, the grazers would have salted them, especially since the salted meat with which it would have to compete came from the United States around Cape Horn. This tardy attempt at packing meat was cut short when the whaling fleet deserted the islands. This grazing industry was chiefly in the hands of whites. The natives did not begin to raise cattle until about 1840, and then each one kept only one or two cows for their milk and butter 107 The natives partly supplied the ships with vegetables and furnished goats and hogs in considerable numbers.'08 2. Commerce Increased. Previous to1820 the commerce of the islands had been confined to the exports of sandal wood, supplying merchant ships with provisions, and importing a few articles in demand among the "upper classes." As we have noted before, the total value of the "exports" in the early twenties did not probably amount to more than $100,000 a year. '09 In 1822 a cargo of salt was exported to Kamschatka, and the missionaries rejoiced to see the beginning of foreign commerce."l Mrs. Judd relates that in 1828 they were on short rations because their yearly supplies which came around Cape Horn had been sent to the wrong whaling grounds by mistake.lll But merchants soon perceived the advantages of Honolulu as a place to store goods awaiting a market, and large warehouses were erected."2 In 1838 there were eleven mercantile houses in Honolulu, and the town began to assume a European appearance.l3 107Missionary Herald, XLI, p. 86; XLV, pp. 76-81. o08Cheever, Lije, p. 63. 109Supra, p. 18. "O1Missionary Herald, XVIII, p. 9. 1 1Sketches, p. 31. 112Cheever, Life, pp. 322-3. 113Spectator, I, p. 85. 32 ECONOMIC HISTORY The following table will show the nature and extent of the development in commerce: Hawaiian Commerce (0,000 omitted). Exports YEAR imports Domestic Foreign TOTAL 1836................................ $ 4. 1.................. $.7 1837........................ 3. 5...............7 1838...................... 2. 0.................6 1839................................ 3. 7.............9 1840................................ 2 2..........7 1843............................ 2......... $0.6.6 1846................................ 2 $6.2.6 6.8 1850................................ 1.10 5.4 2.4 7.8 1855................................ 1 38 2.7 2.9 5.6 1860................................ 1.22 4.8 3.2 8.0 (The figures for 1836-40 are the estimates of Messrs. Pierce & Brown;14 for 1843-60, officials 115) This table illustrates three thingcs, (1) the enormous growth of both imports and exports, (2) an excess of imports over exports, and (3) a relatively large foreigcn export as compared with the domestic. The cause of the in-crease in trade is readily explained by the demands of the whaling fleet. The imports include goods for consumrption on the islands, for the whale ships, for merchant ships, especially the fur traders, and, during the last ten years, for reshipment to California. Foreign exports include t ans-shipments of whale products and imported goods sent to California, and to other points on the Pacific Coast. T: he major part is made up of trans-shipments of whale products, and this shows at once the importance of the whaling fleet. From 1851 to 1860 the whale oil trans-shipped amounted to 17,657,000 gallons; sperm oil, 1,459,000 gallons; bone, 14,132,000 pounds. This explains, also, the large foreign export. The domestic exports include vegetables an d fresh meats sold to ships, hid es, goat-skins, tallow, etc, but chiefly articles supplied to the ships. This analysis explains the second point noted above, the great excess of imports over exports. Goods imported and sold to the ships are not in "l4"Annual, 1896, p. 91. 115Sunmary of Corn. and Finance, July, 1891, p. 273. OF THE HAWAIIAN ISLANDS. 33 cluded in exports as are domestic products sold to the ships, hence, the account could not balance. Had the goods been included, the foreign exports would have been even larger than they are. 3. Increas e of Foreigners. We have before observed that the cattle raisirhg industry was in the hands of whites. As a matter of course the mercantile business was also conducted by them In 1842 there were in Honolulu three churches and a seamens' chapel, two school houses, four wholesale houses, twenty retail stores, four blacksmith shops, fourteen ship carpenters, five house carpenters, three hotels, twelve sailors' boarding houses and grog shops combined, two billiard rooms, seven bowling alleys, and various other shops.16 The ptominence of shops, houses, and trades depending on the whaling fleet is striking. In 1820 there were probably not fifty foreign residents on the islands; there were 2,119 in 1853, and 2,716 in 1860. It is quite evident that foreigners played the leading part in the new industrial activity. 4. Decrease of atives. The decrease in population was not wholly due to the whaling fleet, but as it was one of the chief causes, it is appropriate to consider the subject in this connection. No census of the population was taken before 1832, but there is no doubt that it was decreasing rapidly either just before or just after the white men touched upon their shores. The estimate of Captain Cook, 400,000, has often been referred to, and is generally considered too high. But deserted huts, taro patches and fish ponds, furnished abundant evidence to early travelers that the natives were decreasing. The decrease from 1832 is shown in the following table: 116Alex. Simpson, p. 108. 34 ECONOMIC HISTORY Decrease of Native Population."' Per cent of de — crease of HaPart waiian and YEAR Hawaiian Hawaiian Foreign TOTAL Part awaiian (average decrease per year> 1832..................................... 130,313............ 1836.................................... 108,579 4.2-x 1850................................... 84,165 1.5-* 1853 70,036 983 2,119 73, 138 4.3* 1866 57,125 1,640 4,194 62,959 2.3-': 1872 49,044 1,487 6,366 56,897 2.3* 1878 44,088 3,420 10,477 57,985 1.0 1884 40,014 4,218 36,386 80,578 1.1* 1896 31,019 8,485 69,516 109,020.9* 1900 29,799 7,857 116,345 154,001.5 The two striking things about this table are that the decrease of the native population was spasmodic during the earlier years and (2)that from 1872the decrease is steady,though gradually getting less, and is very small compared with the earlier period. (The number of foreigners was so small during the earlier years that it does not alter the results materially to include them.) The explanation of the first fact may readily be found in the well known result of the contact of partly civilized races with epidemic diseases that follow civilization. Smallpox, measles, dysentery, influenza and like diseases swept away the natives by thousands.18 This accounts for the spasmodic nature of the decrease as well as for its high rate. The natives knew nothing about proper remedies, doctors were few, and most of them were in the larger towns, especially Honolulu. Coan states that in 1848 the measles carried off 10,000, and that five years later the small pox took 3,000 more. In later years the health authorities have had such diseases under their control. In the early years there were other powerful forces at work, and some of them existed when the white man first came to the islands. Wars, pestilence, famines, promiscuous intercourse, drunkenness from the native drink, awa, were among the causes 117"Figures for 1832-36, the Annua,, 90oo; for oo00, Census. ll8 Coan, pp. 198-259-60; S. S. HZll, pp. 111-117; Mrs. Judd, pp. 177-222. OF THE HAWAIIAN ISLANDS. 35 3rw for which the white man was not responsible.l9 There were two other causes, more silent and constant, infanticide and artificial abortion. ' he extent of these forces cannot, from their 'very nature, be told, but it seems certain that they were among the chief causes of th-e decrease of the natives.120 By 1840 these practices were checked to a large extent by the teaching of the missionaries and the laws enacted through their efforts. 11 Infanticide was attended with unusual barbarity, the common practice being to bury the child alive in the hut where the inhuman parents lived. During the early period there were other forces directly connected with the industrial and social changes caused by the presence of the foreigners, and the white man may therefore be considered in a way responsible for these forces. The hardships and exposure to which the natives were subjected in gathering sandal wood were the causes of considerable loss of life."22 The natives were used to the warm, even temperature of the coast, and during the cold, damp nights, without beds or shelter, they contracted colds which often resulted in death. Drunkenness was also doubtless responsible for some of the decrease in numbers. Even the changes in habits and customs often caused death. The natives would wear clothes during warm, fine days, and in cold, wet weather lay them aside for fear of spoiling them. Colds, sickness and even death frequently followed."' All the forces of destruction mentioned thus far had either wholly come to an end or had become of small importance by 1870. There was one force directly attributable to the whaling fleet, and of such an all-pervading, insidious nature that its mark, in all probability, is yet on the native. Several thousand seamen, with their pockets full of money, and with a standard of morality not very high, and half-civilized women not yet reformed from their ancient immoral practices, gives an obvious explanation of the situation, And when it is remembered that the people all " 9garves, History, pp. 93-231-32. 120Ellis, Narrative, pp. 302-5; Mrs. Judd, p. 34; Ruschenberger, II, pp. 366-78; Sir G. Simpson, II, p. 16-18. 121 Wilkes, IV, pp. 62-3-73; also, above references. 122Sir G. Simpson, II, p. 13. l 2Jarves, History, pp. 231-2. 36 ECONOMIC -IISTORY lived near the shore, within easy reach of the ports and roadsteads, it is readily seen how wide-spread this vice would become. The incr easing hardships of the common people helped the matter alonK. Many flocked to the seaports, the men to pick up a little work now and then, and the women to sell themselves to the sailors.,24 Venereal diseases were contracted and became so widely spread among the people that the increase of population was checked at its very source.125 It is highly probable that the continued decrease of the native population up to the present time is due in part to the lingering effects of these diseases. A few figures from CommissionerWright's report on Hawaii for 1901 will illustrate the point in hand.126 In 1900 there were 7,822 women of pure Hawaiian blood who were married or had been married, and the number of Hawaiians under twenty years of age was 13,994. In marked contrast with this state of thing's, there were 5,177 Caucasian women who were married or who had been married, and the Caucasians under twenty years of age numbered 14,239. 5. Changes in the King's Revenue. No quantitative statement of the amount of the king's revenue during the early years of the century is possible, because no records were kept. But with the increasing wants of the king's household, stimulated by contact with civilized man, there was more and more revenue wanted. As the form of government gradually emerged from its ancient simplicity and began to assume a modern type, new items of expense appeared. Shortly after the missionaries arrived a system of public education was established. In 1840 the government began to assume a modern form. From 1840 to 1847 various departments, including an executive, a judicial, and a treasury department, were established. All of these changes made the government more expensive, and the next question is, by what means were these increasing wants satisfied? It will be recalled that in 1820 the king had five sources of revenue: (1) the produce taxes, levied upon the peo'24Jarves, History, pp. 233-4. '25Mrs. Judd, pp. 161-237; Coan, pp. 255-59; Sir G. Simpson, II, pp. 19-21. I26Report, pp. 35-47. OF THE HAWAIIAN ISLANDS. 37 pie, including both the annual tax and the irregular tributes, (2) the rents from his private estate, (3) the sale of sandal wood, (4) business profits, and (5) port dues. Duringr the early years of the period we are considering, the increasing wants of the king were met chiefly by increasing the taxes and rents. Stewart, speaking of the years 1822-23, says that frequently the whole produce of a plantation was carried off.'27 But the rapid decrease in the native population. with no material increase in the thrift and industry of the smaller number remaining, reduced the possible amount of revenue that could be collected. The same condition would apply to the rents from the king's estates. When. the sandal wood began to decline in the early twenties, the revenue fron. this source declined in consequence, and after i830 did not amtount to much. lThe king and chiefs hit upon a curious expedient. WAhenever they built a new house, they had a "house-warming' at the expense of the visitors. All who entered it for the first time were required to pay a fee. In 1822 the king ha.d a new house built and rerchants were chargred from fifty to eighty dollars to enter, other foreigrers from twenty to thirty, and the serva7n.ts of the household two dollars and upwards. By this means several thousand dollars were raised. 28 In 1829 a resident merchan v writes in his journal: "Yesterday and today all hands are carrying in their tribute (/zookzPu) to the king, on account of his r ew house; once in a while residents called and gave him, some five, and some ten dollars."'29 Evidently, house building was quite fashionable in high circles, as the king had built a house but a few years before But this source of revenue was necessarily limited, because me-r' chants and resident foreigners in general, who were the chief contributors, would soon get tired of this sort of a"benevolence. Being only a temporary source, it is interesting chiefly because of its oddity. Until 1842 the governors and chiefs continued to act n thei ancient capacity of tax-collectors. The Bill of Rights tcck away 127Rcsidenzce, p. 102. 128SIewarl, p. 103. 1 2"' Az,:i ua, 190, p. 87. ECONOMIC HISTORY from them in 1839 the power to levy taxes upon the people or to take from them any produce or to require gratuitous labor. But the chiefs and governors were not required to render an account of what they collected for the government. In 1842 an important change was made Books were opened, and accounts were to be kept of all taxes received and all expenses, and public officials were to receive salaries for services rendered.'30 This change doubtless resulted in an increase of net revenue to the government. But with this advantageous change, it still remained true that the power of the natives to pay taxes was decreasing. Hence, all the old sources of revenue, taxes, rents, sales of sandal wood, business profits, (for with increasing dignity business ventures were abandoned by the kings), and the "house-warming" fees, were decreasing or had altogether given out just at the time when more and more revenue was wanted. This increasing need was chiefly supplied by port charges and taxes on imports. The old port dues, established in 1816, gradually expanded into a complete tariff system. In 1818 the harbor dues were $80.00 for anchorage and$12.00 for pilotage 131 In 1822 they were $80.00 for the inner harbor, $60.00 for the outer, and $1.00 a foot for entering, leaving, and anchorage.'"2 In 1847 imports were subject to an advalorem duty of 5 per cent. Whale ships were exempt from port dues, except a nominal fee of $3.00 or $4.00, and whale products were trans-shipped free. 33 The reason for this exemption is plain. The government did not wish to drive the whalers elsewhere and thus lose the benefit derived from the wealth and industry depending upon the whaling fleet. With the growth of commerce, the revenues would increase as a consequence, the receipts from port dues and from customs both increasing together. In 1843 the customs receipts amounted to only $8,468. During the early forties, the "palmy days" of the whaling fleet, the annual receipts averaged over $150,000. With the decline of the fleet the receipts fell off, reaching low-water mark in 1861, when they amounted to 30VJarves, History, p. 174. 131Corney, p. 96. 132Steewart, p. 103. 33 Cheever, Island World, p. 380. 3s4 Summary of Commerce and Finance, July, 1901, p. 273. OF THE HAWAIIAN ISLANDS. 39 only $98,054.00.T34 When industry revived and established itself on a new basis, the customs receipts azain increased. Two other sources of revenue were also of increasing importance, namely, licenses and the lease of lands to foreigners. In 1852 the net revenue from licenses amounted to $22,725,14, 35 or one-fifth as much as the customs receipts. Poll taxes were also among the new items of revenue, the rate in 1841 being $1.00 for a man, 50 cents for a woman, 25 cents for a boy, and 12/2 cents for a girl.36 All these taxes, new and old, gave to the government during the closing years of the period about $500,000 annually.'37 6. Increasing Hardships of the People. The twerty years, from 1820 to 1840, formed the most gloomy time for the common people of any period in Hawaiian history since the white man touched their shores, The wars of Kamehameha I, in the latter part of the eighteenth century, doubtless caused more acute suffering here and there, wherever his strong arm struck a blow, than was experienced during t:he rperiod from 1820 to 1840; but these ravages were transient and soon forgotten.. The misery of this period was wide-spread, reaching every peasant's hut in the land. Though the bodily suffering was not continuous from day to day, the knowledge thaat t any moment it was liable to recur and the consequent mental suffering were ever present. The attractions of the capital drew the chiefs away from their estates, and they were represented by more rapacious agents.138 We have previouslyalluded to thehardships connected with the sandal wood trade. These hardships were greatly augmented during this period. Kamehameha I had monopolized the trade, and he was wisely conservative in the cutting of the timber, lest it give out. But when Liholiho succeeded him in 1819, the control of the trade was given to the chiefs, and the people were sent to the mountains in increasing numbers."3 As the wood became scarce and hard to finu:, mnore time was required to gather it. '35Reper/ o/f Iinister of Interior (I-awaii) 1853. 136Sir G. Simpson, II, pp. 77-85. '37 Summary of Commerce and Finance, July, 1901, p. 276. 1 38 n'nual, 1901, p. 109. a39,Jarves, History, p, 100; Sir G. Sim,:ps;on, 11, pp. 13-14. 40 ECONOMIC HISTORY The new market for provisions created by the whaling fleet increased the frequency and regularity of the demands of the king and chiefs for produce and labor services. One illustration will serve to show what was going on. In 1822 there was a great demand for potatoes to supply the ships, and the king ordered all his subjects to bring in all the potatoes they had.'40 By 1830, or before, the chiefs usually demanded of their tenants one-half of everything they brought to market, without, however, abandoning their right to take whatever they might find, not brought to marketr4l The effect of this requirement was to check any desire on the part of the native to avail himself of the benefits of the new market. We have observed above that the use of money did not prevail among the common people generally until after 1840; hence, there could not have been any widespread practice among the peasants of bringing their produce to market. Rather than hold their lands under such conditions, many deserted them, preferring to take their chances in being able to get a day's work now and then or to get along some other way. Cultivation was neglected, a famine ensued, and some, in despair, fled to the forest. Parents renewed the old practice of giving away their children. The women could get a few dollars as the price of sin; many flocked to the ports, and homes were broken up. This state of things came to an end with the passage of the Bill of Rights in 1839.142 Decline of the Whaling Fleet. In 1860 there was a sudden drop in the whaling industry of the North Pacific. In 1859 there were 549 whale ship entries at the various Hawaiian ports; in 1860 there were but 325. In 1862 the number dropped to 73. There was an increase after the Civil War, when Confederate cruisers were out of the way, but the highest number of entries for any subsequent year was 243 in 1867. For the ten years ending 1860 there were 4,440 whale ship entries; during the next ten years there were but 1,520. The whale products transshipped showed a like falling off. The amount of whale oil 40oMathison, p. 452. I4"Bennett, Voyage, I, p. 245; Ruschenberger, II, p. 378. 42Jarves, History, p. 231. OF THE HAWAIIAN ISLANDS. +trans-shipped during the first ten years mentioned above was 17,657,000 gallons, and during the following decade it was only 7,102,000 gallons.143 After 1870 there was another drop, and then a constant decline. In 1880 the entries and the trans-shipment of whale products may be considered as practically at an end. The causes of this decline were various, but the disappearance of the whales from their ancient grounds was at the time generally considered as the main cause.l4 And shortly after the decline began, the whalers were attracted to San Francisco "by alleged cheaper facilities for refitting and shipping their catch to eastern ports.'145 To these causes may be added two others which affected the whaling industry the world over, namely, the development of the oil fields of the United States and elsewhere and the substitution of steel for whalebones in umbrellas and other articles inwhich whalebone had been used. In 1871 the greater part of the North Pacific Whaling Fleet was destroyed in an Arctic ice-crush,t46 and since that time the whaling industry has been of little consequence to Hawaii. The results were not so disastrous to Hawaii as some might have predicted. Mr. R. C. Wyllie, writing in The Friend, July 1, 1844, declared that, "If the whale ships should leave, the islands would relapse into their primitive insignificance." It was no doubt a severe blow to the grazing and mercantile industries, which depended upon the whale ships. Merchants and stock raisers suddenly found themselves deprived of a market, and the latter were left with herds of cattle on their hands which were almost worthless.l47 But a new industry was rising, the production of sugar, which was to eclipse the old. Before entering into the discussion of this new industry, however, let us retrace our steps and examine the greatest event of the period we have just been considering, the overthrow of feudalism. 143Appendix, Table II. I44Baxley, p. 552; Hopkins, p. 406. 45Annual, 1896, p. 95. 146Annual, 1895, p. 100. '47THopkins, pp. 401-406. 42 ECONOMIC HISTORY CHAPTER VI. Overthrow of Feudalism. I, Sketch of Events. The Bill of Rights. It will be recalled that there were four vital principles in ancient Hawaiian society, namely, (1) there was no legal security of tenure of grants of land from either king or chiefs; (2) there was no definite rule as to the amount of labor or produce the peasant must give his lord; (3) yet the tenant was not bound to the soil, being free to give up his holding; (4) the revenue of the king consisted of produce and labor services from the people as a whole and of produce from his private estates. The Bill of Rights, passed in 1839, was the first blow to this system. The following is the vital portion of that great document: "Protection is hereby assured to the persons of all the people, together with their lands, their building lots, and all their property, while they conform to the laws of the kingdom, and nothing whatever shall be taken from any individual except by express provision of the laws." In 1840 this clause was embodied in the constitution. The words of this passage from the bill of rights should be studied with care, for in it are three important grants of privileges to the people. First, they are protected in their persons, that is, no chief could compel any one to work for him. Compulsory labor service was at an end, except in so far as it should be by a general law, in which case it would be a general tax. Secondly, all were secure in their holdings, from the greatest chief to the common peasant; none could be dispossessed except by express provision of the law. Thirdly, the clause "nothing shall be taken from any individual" etc., struck at the old produce rents levied by the chiefs. The common people, therefore, were no lo g'er subject to the will of any chief. They could 01' THE HAWAIIAN ISLANDS. hold their little plots of ground without rendering labor service or paying any rent, unless according to the provisions of a general law. Also, the chiefs were secure in their holdings. The uncertainty and indefiniteness in the old system were removed. But ownership in the soil was not established. No one could dispose of his lands, however greatly he might desire to change his condition or his occupation. And the chiefs could not compel their former tenants to till their lands nor to pay any rent, though their fields should go untilled and their income be destroyed. Such conditions could not long be satisfactory, and six years after the passage of the Bill of Rights the government be* gan to make different arrangements. Division of Lands (1845-55). The break-up of the old feudal system and the establishment of a new order of things was no easy matter, as men do not readily turn their faces squarely away from beaten paths. Prejudice is strong, and when strengthened by a feeling on the part of the leading members of the community that they would have to make a great personal sacrifice, the difficulty of bringing about any change is augmented. The great chiefs would no longer be little kings with subjects and retainers obedient to their call; they would be simply great landholders, like several white men in their midst, Hence, the legal steps in the process of dividing up the lands and establishing allodial tenures were halting and half-way measures. We can follow only the important steps. The division began in 1846, when surveyors were sent out to mark out the boundaries of the kuleanas, or peasants' holdings, so that they as well as their chiefs might know their own lands.148 In 1846 a board of commissioners was appointed, which had authority to investigate and decide all claims. The distribution was completed and agreed to on the 7th of March, 1848. At this stage of the process of division there were three classes of landholders, (1) the king, whose share is known as the Crown Lands, (2) the chiefs, and (3) the small holders. But the chiefs and the people did not have allodial titles, and the chiefs' lands were charged with certain dues to be annually paid to the government. The next day after the great division in 1848 began what 44 A ~~~~~FCONOMIV HISTORly may be,- called the second division, when the king set apart forthe gover'nnent nearly one-half of his Crown Lands. In 1849 the common people were given allodial titles to their lands, and the next year the rent charges upon the lands oft te chiefs were commuted, the chiefs being given the option of paying to the gov-~ ermient a lump sum equal to one-third the value of their lands,. or of giving to the government one-third of their land, in return for allodial titles to~ th~e lands remaining to tihem. Thuas were established four classes of lands, (1) the Crown Lands, (2) the Government Lands, (3) the lands of the chiefs, and (4) the kulean1as, or the lands of t1-e common people. The Ancient Land System. In order to understan d the difficulties 'in the way of an equitable division of lands among the different classes, it will be helpful to consider briefly tLhe anciernt land system."'4 TI e unil in the system was the ahuJuaa, which w7,as not a unit of definite area, but which varied in size from 100 to 100,000 acres, or even larger. The ahupuaac), we re simply strips of land of various widths, running from the shore back towards the center of the island. The smaller ones extended only to the timber belt or a short distance irno it and there the larger ones expanded and extenl,~d. to the top of the mountains. At the sea shore also the larger ones had thb advantage, the smaller ones includinr only a narrow strip of the sea, while the larger ones again expa ided so as to include the larger part of the fish pondis The alhufuaas had bounidaries~ firly well marked, the lines usually following some ridge or ravine, or extending from some conspicuous object to anot.her. rThe next sub-division of land was called Ian i/i, which was also roughl; bounded by natural lines or sometime by artificial monuments. The ilis were frequently in scattered 1jac,. as to include various grades of land, and, like the larg-er divisions, were of v~arious shapes and sizes. The ilis were of twAo kinds, the i/i of the ahujpuaa and the -I/i ku.* The latter were ' 48See the Animal, 1891; G. J. Lyons, in The I'slands, July 23, 1875; Rey-ort o; the Governor of I-iawaii for 1,90!, pp. 5-8. " "See articles in The Islands, 1875, by 0. J. Ly ons, and Report of the Governor of Hawaii for 1901, pp. 5-8. -, 'orcefuly "IiM kupono"l z. e., iii, in its own right, an indepen dent ifii OF THE HAWAIIAN ISLANDS. 45 not properly sub-divisions of the ahujuaa, which was the unit of land granted to a chief by the king. The chiefs sub-let to lesser chiefs, the ili being the unit of these lesser chiefs who owed fealty directly to the great chief. But when the king granted an ahufuaa to a chief he reserved the right "to carve out an ilz ku, which paid no tribute to the chief, but made its returns to the sovereign direct."'50 Some of the smaller ahujuaas were not sub-divided, and some of the larger ones contained thirty or forty ilis. The third sub-divisions were thekuleanas,or the grants from the chiefs to the actual cultivators of the soil. Unlike the ahu5uas and the ilis, the kuleanas had no definite boundaries, but consisted of little patches here and there which the chief had not included in his own fields and which the tenant saw fit to cultivate. The taro patches and fish ponds had, as a matter of course, well defined boundaries, but the other little crops had not. Difficulties in the Way of Division. One may imagine that this "patchwork" system gave plenty of trouble. With the greatest care and intelligence it would have been no easy task to give all classes just what belonged to them and leave no doubt as to boundaries. But the whole process was gone through with in a haphazard way wihch resulted in confusion and often in injustice. After the division, the government often sold or leased large tracts of land without stating what kuleanas were excepted, and frequently a person who bought or leased a certain-piece, supposing that he was getting the whole of it, found that onethird or even one-half of it was kuleanas excepted. '5 Moreover, there was no general, systematic survey of the government lands. When a piece of land was sold or leased it was surveyed, and one surveyor would overlap what another had surveyed. In recording the surveys of the kuleanas, the configuration and extent of the little irregular, scattered patches were noted, but the important element of location was omitted.'52 Thus con150Report of he Governor of Hawaii, 1901, p. 6. 15 C. J. Lyons, in The Islands, August 13, 1875. 52C. J. Lyons, in The Islands, August 6, 1875. 46 ECONOMIC HISTORY fusion reigned. As late as 1875 these matters were not straightened out. Injustice was often done the common native through the ignorance of the surveyors. They were directed, in surveying the kuleanas, "to include what the claimant has cultivated and improved," and the decision of what this would include was left to the surveyors. Some surveyors, not knowing that it was the custom to let a part of the land lie fallow a number of years, included only what was actualliy in a state of cultivation, and the native sometimes abandoned his land as worthless.'l3 Other surveyors, knowing the prevailing custom,awarded ten or twelve acres In districts where the missionaries took an active part, thirty or forty acres were sometimes awarded. Amount of Land Given to Each Class. This breakup of the old system was so novel that the common natives thought it a ruse to tempt them to build houses and make improvements, so that they might be taxed heavier, and many neglected to put in their claims.154 But the missionaries persuaded them that the lands really were to be divided, and the government postponed the limit of time set when all claims must be presented. A small fee of from $3 to $5 was charged the common native for a freehold title, to cover the expenses of surveying. The following table represents approximately the result of the division of the lands.155 ACRES. Government Land........................1,495,000 Crown Land............................. 984,000 Chiefs' Land............................1,619,00 Kuleanas.......2...................... 20,000 T otal...........................4,126,000 The Government, the Crown, and the chiefs got the lion's share. The great body of the natives received only 28,000 acres, or about seven-tenth of one per cent of the whole. But since it was all good land, while a large part of that going to the other three classes was worthless, the kuleana land would be worth much more than seven-tenths of one per cent of the whole 1531bid, August 6, 1875. l4 Coan, p. 124. 155Report of the Governor of Hawaii, 1901, p. 7. OF THE HAWAIIAN ISLANDS. 47 The Natives Dispose of Their Lands. The number of awards confirmed by the land commission was 11,309."'5 The amount of land that went to the chiefs and common people together was 1,647,000 acres. According to the census of 1900, there were at that time 320 Hawaiians owning 21,771 acres, and 40 part Hawaiians, owning 7,513 acres.''5 The two classes together owned a little less than 30,000 acres, or about one and one-fifth per cent of the amount of land that went to the Hawaiians, chiefs and common people, in the great division. The causes of this change are not far to seek. Though the lands sold by the government during the first few years after the division was bought by Hawaiians,"'5 as the law did not allow foreigners to hold freehold titles until 1850, there were forces at work that soon deprived the natives of what they purchased and what went to them as their share of the lands. The grazing industry was then at its height, and lands were in demand by the foreigners, who bought large tracts both for immediate use and for speculation.*"5 And in few years the rich lands were in demand for raising sugar cane. Besides these general demands for land on the part of the foreigners, there were special reasons why the kuleanas would be particular objects of desire. They were of good quality, and they were so located that they would be very troublesome to those owning and using the land in which they lay. It is easy to imagine what difficulties there would be in trying to cultivate a field in which there were a dozen or more of irregular shaped pieces scattered through it. The common native could sell his land for what would seem to him a big price; or he might sell a part of it and still have enough to satisfy his wants, especially if he were among those so fortunate as to receive thirty or forty acres. Moreover, if the peasant holder died without heirs, which frequently happened, the land reverted to the owner of the ahupuaa out of which it was originally carved. If we remember how prone the chiefs were to get into debt to foreigners, we have a ready explanation of how they disposed of their lands. 60 1" Ibid. 57 Census Bulletin, No, 169, p 6. 58 Report of the Governor of Hawaii, p. 8..5"Bates, p. 141. 10Bulletii, No. 95, Department of Agriculture, p. 87. ECONOMIC HISTORY The land sold by the government did not bring in very much revenue, because it was sold so cheap. Ia 1853 the Minister of the Interior reported that during the previous year 27,499 acres were disposed of at an average of a little less than a dollar an acre, and 4,141 acres at "nominal" prices. Coan states that even rich land near Hilo and other places sold for $1, $2 and $3 an acre.1 6 A large part of the land sold was fit only for grazing purposes, and was not, therefore, very valuable. II. Forces at Work. 1. General Discontent. If we take a look at the general condition of affairs during these two decades previous to 1840, we can see several forces at work that tended to make all classes discontented with the feudal organization. The most general cause, and one that affected all classes of the natives, was the example set before them of a better system. Living in their midst was a class of foreigners having complete control of their time and secure in their personal property. The king might have had the power to demand whatever he saw fit, but, for obvious reasons, such arbitrary power was not exercised over the foreigners. On the other hand, the whites who had grants of land from the king, either for grazing, for agriculture, or for building lots, held it on the same insecure footing as did the chiefs. There was much complaint among the foreign residents that they could not sell or transfer real estate.162 'his itnfluential body of people, one and all, would be anxious for a change and would lose no opportunity to express their disapproval of the existing order. The chiefs began openly to disapprove of some phases of feudalism as early as 1825. What they particularly objected to was the reversion of grants on the death of the holder, and the sequestration during the life of the holder. Under the wise rule of Kamehameha I, there had been security, but Liholiho, who succeeded him in 1819, had sequestrated many estates,'6 and 'l1LiJe, p. 124. 162Ruschenberger, I, pp. 394-401, d63Jarves, History, p. 233. OIO TIA flAWATIAN ISLAMDS. 44 ~any king who saw fit could repeat the practice. And since there was a demand for land by the foreigners, there was all the more danger to the chiefs. The king was dissatisfied because his kingdom was apparently going to ruin. The population was rapidly decreasing, the common people were poor and dissatisfied with their condition, and were leaving their homes and flocking to the towns, where vice would still more rapidly deplete their numbers. To the king all this meant a decrease in power and dignity, and particularly a falling off in the ancient revenues. That the common people were discontented goes without saying. But if the whaling fleet increased their hardships, it also offered a means of escape. As we have noted before, the men could get a little work now and then, and the women could follow their objectionable pursuit. This desertion of the home by the common people affected not only the king, but particularly the chiefs, who did not have, as the king had, a source of revenue outside of the feudal organization. Their revenues depended upon the number of their tenants. Here, then, was the point at which the feudal organization broke down. When the people could no longer endure their burdens, they could cast them off, for they were not bound to te soil. This one weak point in the structure helped to bring about its ruin. 2. Influence of the Missionaries. There is no evidence that during the first few years of their labors the missionaries openly attacked the system of society they found on the islands. Indeed, it is not to be presumed that they would, for such a course would probably have resulted in their expulsion from the kingdom. But in the course of time they gained the confidence of king and chiefs. They became the teachers, the friends, the companions, and finally the confidential advisers of the kings, Their influence in the government is well known to the student of Hawaaian political history. And when affairs began to be serious, they openly advised against the feudal system.'64 The constant urging of the natives to beware of the sin of idleness, and the endeavors to induce him to save and accumulate property, would tend to give him a more vivid conception of the right '64Jarves, History, p. 231. 50 ECONOMIC HISTORY in property and the injustice of the system that took from him the fruits of his toil. And the very spirit of the gospel message, which teaches humanity and brotherly love, would work against this system of injustice. 3. A Better System Pointed Out. Though men are dissatisfied with things as they are, they are not willing to cast them aside unless they have hopes of getting something better. To excite discontent is one thing, to induce men to venture into new and unknown fields is quite another. Fortunately, there were indications of better things in the changes going on, and the king and his advisers did not fail to see them. In 1835, Ladd & Company leased a tract of land on Kauai, and the next year the king declared that he received more revenue from that one plantation than he had previously received from the whole island.T15 The king saw plainly that here was a way by which to increase his revenue. But foreigners were not satisfied with the insecure tenure on which they held real estate, as we have observed; and in order to induce more foreigners to invest their money in the new industry a change in the existing order of things was, if not absolutely necessary, at least desirable. Commodore Kennedy, in 1839, wrote a letter to the king in which he advised the extension of the practice of leasing lands, and such changes as would allow foreigners to transfer titles, urging that by so doing he would encourage foreigners to build houses on their lands, and thus give work to the people. Another foreigner, C. K. Stribling, at the same time, wrote a letter to the king, full of good advice. He recommended four definite changes, commenting on each one. These changes suggested were, (1) a fixed and certain rent upon land; (2) security of person and property; (3) an entire abrogation of all compulsory labor; (4) equality of taxation, which should be as light as possible. These changes, he urged, would give life to the declining prosperity of the kingdom.'66 The periodicals then published in Hawaii offered the same remedy for the ills of the kingdom and promised the same beneficent results. The Rev. John Diehl, in The Spectator, 1838, says 166Ruschenberger, II, p. 392. x66Ruschenberger, II, pp, 394-401. OF THE HAWAIIAN ISLANDS. 51 that "'were it not for the policy of the government, which denies to a man the fruits of his own labor, the paltry trade of a few thousand dollars would give way to a trade of great wealth, and cotton, coffee and sugar cane would take the place of weeds and untouched grass."'67 Thus, from all sides, advice was showered on the rulers of the little kingdom, and they were not too dull to see the soundness of that advice. The deserted fields would again be tilled, all would have new life and hope, and the revenues of the state would be augmented. The chiefs also would share in the general benefit. They would be absolute owners of their lands, and they could sell them or lease them for more than they could get out of their discontented tenants. With such hopes held out to them, king and chiefs could be induced to adopt the white man's ways and manner of government.,67 The Spectator, Vol. I, p. 89, See also pp. 56-7-74. ElCOOm IC HISTORT CHAPTER VII. The Effects Upon Hawaii of the Settlement of California. (1850-1876.) General Remarks. We now enter upon a new phase of Hawaiian industrial life. The period of the whaling fleet, 1820-1860, was chieflly commercial. Hawaii depended upon outside sources: in 1860 these resources began to fail, and she rapidly shifted to the new industry that had been for ten years growing up, and henceforth she is chiefly an agricultural community. We have hitherto been largely interested in the native Hawaiian, his change of habits, his hardships, his final escape from them, and his general share in the industrial life of his nation. From this time on foreign capital and foreign labor come more and more into prominence, and the native sinks into comparative insignificance. It is also to be observed that the forces we are now to consider entered the feld ten years before the close of the period of the whaling fleet. The immediate effects of the settlement of California by Americans after the discovery of gold in 1848 were, (1) to give a false stimulus to agriculturej chiefly the cultivation of wheat and Irish potatoes, and (2) to increase the roundabout trade between California and Atlantic ports. But the industry finally narrowed down to the production of sugar, and coffee and rice as minor crops. Hence, we must distinguish between the temporary and the permanent effects upon Hawaii of the settlement of the Pacific coast. I, Temporary Effects. 1. False Stimulus to Agriculture. When the exciting news was spread abroad that gold had been found in California, thousands rushed to the new gold fields. Even Hawaii furnished quite a number of gold hunters.l68 During the first year 10,000 168Judd, p. 175. OF THE HAWAIIAN ISLANDS. 53 people left Oregon.'69 What little agriculture there had been on the Coast was neglected, and provisions became abnormally high, there being no easy means of transportation from other sources of supply. Sugar, hams, coffee, potatoes, sold at the mines for a dollar a pound. A line of twenty-seven vessels ran between Hawaii and the Coast, thus giving hopes of easy transportation.l7" These enormously high prices and an opportunity to reach the new market offered great hopes to agriculture in Hawaii. A writer in The Polynesian, in 1850, says that there was tenfold more planting than formerly, caused by the demand in California.7' The islands of Maui in particular was the scene of new activity, as its soil is well adapted to wheat and potatoes. ' Wheat and potatoes and a few other vegetables were sent to California in large quantities, and handsome profits were realized. Three or four flouring mills were erected, and the people of Hawaii began to congratulate themselves that they could now have fresh flour instead of the musty flour that came around Cape Horn.173 But this new activity soon ceased. After the first flurry of excitement was over in California, it began to appear that a fortune was not awaiting everybody at the mines, and many turned to farming. In 1854 California had vegetable and wheat fields, and mills of her own.T74 The hillsides of Hawaii could not compete with the rich valleys of California, and the new industry in Hawaii was crushed. Today she raises no wheat, and only a small portion of the vegetables consumed in the islands. 2. Commerce Increased. The old sailing vessels,in going from Atlantic ports around Cape Horn to Pacific ports, or on their homeward voyage, found it almost necessary to take advantage of the prevailing winds and go first to Hawaii and then to their destination.175 Many vessels from the Atlantic would go no further than Hawaii, there unloading their cargoes and 169H. H. Bancroft, Cal., Vol. VI, pp. 111-12. 7OJudd, p. 175. 71Cheever, Island World, p. 399. 1721bid, Life, p. 121; Bales, p. 317. "3aBates, p. 317; Annnal, 1895, p. 99. 174^. H. Bancroft, Oregon II, pp. 337-38. 17"Sir G. Simpson, II, pp. 132-36. 54 ECONOMIC HISTORY returning' with whalebone and oil and the various products of Hawaii, such as hides, goat skins, etc. While the towns on the Coast were small, no one port would need a whole cargo of the same kind of goods. Hence, Honolulu served as a distributin, center for Pacific ports, a line of vessels taking assorted cargoes from there to the various points. During the fifties and sixties the imports from Hawaii included such articles as iron, gold, copper, buttons, clothing, ivory, etc.,'7 evidently not the products of the islands. T'he effect of this indirect trade upon foreign exports is quite apparent. Though trans-shipments of whale products, whici appear as"foreign exports, "were rapidly decreasing after 1860, foreign exports rose from about $300,000, in the latter part of the fifties, to over $600,000 ten years later.'77 But the ocean steamer, which regards neither winds nor ocean currents, ard the Union Pacific Railroad, completed in 1869, put an end to this branch of Hawaiian trade. After 1871 the foreign exports suddenly drop to about $200,000 annually, and since that time they have formed a very unimportant item. II. Permanent Effects. A Development of the Sugar Industry. Growth Before 1860. A few foreign residents attempted sugar making at a very early day. In 1803 some escaped Botany Bay convicts raised a little sugar cane.'87 Anderson states that 513,684 pounds of sugar were exported in 1814.17 But the beginning of the sugar industry on anything like a business scale was in 1835, when Ladd & Company leased lands for raising sugar cane. In 1838 they had eighty acres under cultivation and were making preparations to put in two hundred acres more the next year.'80 In that same year there were twenty mills in operation or about to be constructed. Ladd, writing in the Hawaiian 176 Commerce and Navigation, for the various years. 77 See Appendix, Table 1. ' 78Jarves, History, p. 98. 'T9Hawaiian Islands, p. 248. 18qJarves, in the Spectator, I, pp. 70-71. OF THE HAWAIIAN ISLANDS. 55 Spectator, in 1838, predicted that Hawaii would become a sugar country. 18 TI'wo obstacles, however, hindered the early development of the industry, namely, the great distance to market, and the difficulty of getting laborers. Though the natives were deserting their lands in considerable numbers, not many were attracted to the plantations by the wag'es offered, twelve and a half cents a day.182 And the chiefs were loath to let out on contract the tenants who remained faithful to them, feeling that a large number of tenants and retainers added to their dignity. But even after the common people were free to do as they pleased, the planters still had difficulty in getting laborers, From 1843 to 1857 the exports of sugar, estimated from merchants' books, varied from 300,000 to 750,000 pounds a year,l83 a very insignificant amount even for the small territory of Hawaii. The next three or four years shows a steady and rapid progress, the exports for 1860 being 1,444,000 pounds, or twice the amount for 1857. The machinery used was of a rude sort, the mills being of wood or stone and the kettles of an inferior kind.'84 It is quite evident, therefore, that up to the time when California gave a market for Hawaiian sugar, the industry was of very little importance and had not passed beyond the experimental stage. Development to 1876. In the latter part of the fifties it beganr to be seen that wheat and potatoes were not the kinds of crops to raise for the California market, and the foreigners engaged in agriculture turned their attention more to the sugar culture, which seemed to be in a prosperous condition. The decline in the mercantile and grazing industries in the early sixties also turned men's thoughts still more towards sugar. In 1860 more scientific methods of cultivation and better machinery were introduced. The following table will illustrate the development from 1850 to 1876: 1815Spectator, I, pp. 76-77. 18 2Jarves, Scenes and Scenery, pp. 98-100; Ruschenberger, II, p. 392. 182Bates, Appendix I; The Annual, various years. 184 ullelin No. 95, United States Department of Agriculture, 1901, 56 ECONOMIC HISTORY Development of the Sugar Industry.'85 (000 Omitted.) SUGAR. EXPORTS. Total YEAIR. IMPORTS. Exports. Exports to United States ~~~~~~~YEAR. IMIVC~PORTS. '(Fiscal Year.) Foreign. Domestic. Total. Pounds. Pounds. Dollars. 1850 $1,101 $246 $ 536 $ 783 750............... 1855 1,383 297 274 574 290 586 $ 32 1857 1,130 222 423 645 701 598 40 1860 1,223 326 480 807 1,444 1,452 83 1863 1,175 281 744 1,025 5,292 2,083 144 1865 1,946 287 1,521 1,808 15,318 2,235 162 1867 1,957 355 1,324 1,679 17,127 15,197 786 1870 1,930 630 1,514 2,144 18,784 14,016 902 1873 1,437 402 1,725 2,128 23,129 15,743 935 1876 1,811 185 2,055 2,241 26,072 20,978 $1,052 The most notable thing about this table is the great increase in the exports of sugar, both absolutely and as compared with the total domestic exports. From 1860 to 1865 the exports of sugar increased nearly tenfold. I have not been able to find the figures for the value of the exports of sugar, but we may estimate itat five cents a pound, a conservative figure.l86 Taking that as the average price, we find that in 1850 the value of sugar exported amounted to about seven per cent of the value of all domestic exports; in 1857 it is about nine per cent; in 1860, fifteen per cent, and in 1867 over sixty per cent; and during the next ten years the exports of sugar maintain about that proportion. The early sixties, therefore, form a period of sudden and great expansion, and from 1865 or 1866 to 1876 there was a slower but constant growth. By 1867 the sugar industry was not only firmly established, but it was the all-important industry in the islands. The next point to note in the table is that, excepting the period of our Civil War, when Confederate cruisers interfered '85Figures for imports and exports are official (See Appendix Table III); for total exports of sugar the Annual, various years; for exports of sugar to the United States, Annual Reports on Commerce and Navigation. 186Bates, p. 172; Foreign Relations, 1894, p. 94. OF THE HAWAIIAN ISLANDS. 57 with the trade of Hawaii, nearly all the sugar exported came to the United States. California furnished the market that Hawaii was looking for. For a few years, just before 1876, a smaller percentage of Hawaii's sugar came to the United States than formerly, doubtless due to the development of Australia. Our table also shows the transitional nature of the period. As we have before observed, foreign exports, though increasing until 1870, were becoming of less and less importance as compared with domestic exports, which indicates the change from the old commercial period to the new agricultural period. Durthe fifties, the foreign exports often exceeded the domestic. In 1876 the foreign exports amounted to only eight per cent of the total. This change in Hawaii's industry altered the relations between total imports and total exports. During the fifties the imports averaged about $1,300,000 annually, and from 1860 to 1876 they averaged a little less than $1,600,000, showing an increase of about twenty per cent. Notwithstanding the decrease, 6.75, in imports for the whaling fleet after 1860, the increase in imports for re-shipment to California up to 1870, and the continued increase in imports for consumption, caused by the growth of the foreign population, more than made up for the loss. But the growth of the sugar industry augmented the exports even more than the imports. During the fifties the exports were only about half as large as the imports. In 1869 the former exceeded the latter by $326,000, and they continued to exceed them in an increasing ratio. Increase of Public Revenue. The net result of the decline of the old mercantile life and the development of the resources of the islands was to increase the public revenues, as the following table will show: 58 ECONOMIC HISTORY Public Revenue.'87 (000 Omitted.) Customs YEAR Total Revenue Receipts Internal Taxes 856................................. 419 $123............ 1858.............................. 537 116............ 1860................................. 571 116............ 1862................................. 528 107............ 1864................................. 538 159............ 1866................................. 721 215............ 1868................................. 825 210............ 1870.............................. 834 223............ 1872................................... 91 2 218 $216 1874................................. 1,136 183 207 1876.............................. 1,008 199 162 It would be more satisfactory to have all the items composing the total revenue, including especially land sales and leases, but from the facts given in our table, we can deduce some important truths. In the first place, we note that the revenue increased about one hundred per cent, comparing the first three dates with the last three. Secondly, the customs rereipts show an increase of about seventy per cent. This increase is due both to the greater value of the goods imported, during the later years, and to the rise in the rate of duty. The total value of dutiable goods imported during the five years, from 1856 to 1860 inclusive was, in round numbers, $6,007,000, and during the five years from 1872 to 1876, $6,852,000, an increase of about fourteen per cent. The average rate of duty during the earlier years, or from 1856 to 1864, was about ten per cent ad valorem; from 1864 the rate gradually rose to over sixteen per cent in 1876.188 The third and most important fact to notice is, that, during the last portion of the period at least, the customs receipts and the internal taxes together form but a small part of the total revenue. Internal taxes included taxes on real estate, personal property, horses, mules, dogs, carriages, and seamen and poll taxes, but not the very important items, land sales and leases. 89 1"7Summary of Commerce and Finance, July, 1901, pp. 272-76; (See Appendix, Table V.) "8See Appendix, Table V. 189Sunmmary of Comnmterce and Finance, July, 1901, p. 272. OF THE HAWAIIAN ISLANDS. 59 These are the only important items not included, and we may therefore conclude that the increase in the revenue was due largely to the increase from these two sources. The sugar industry was calling more and more land into cultivation, and the government was reaping the benefits that accrue to landowners when there is an increased demand for their land. Labor. Ever since the beginning of the ungar industry in 1835, the unceasing cry of the planter has been for cheap and efficient labor.'90 When the settlement of California gave a market for Hawa.iian sugar and thus removed one of the two obstacles to its profitable cultivation, the other obstacle camne into greater prominence. As the industry expanded, the planters made more vigorous efforts to obtain cheap labor. In 1850 the Royal Hawaiian Agricultural Society, a private organization of the planters, was formed, and it put forward the idea that in view of the fact that the natives were rapidly decreasing, Chinese coolies should be imported. In 1852 one hundred and eighty coolies were imported, and as they proved satisfactory to the planters, other importations followed. They were given their passage and paid $3 00 a month, with board, clothes, housing and medical attendance. It was soon perceived by the king and his council that Chinese coolies would not be good material from which to build up an intelligent class of citizens to take the place of the rapidly decreasing natives. The king, therefore, formed the plan of introducing free immigrants, (that is, not bound by contract), both male and female, from the Polynesian groups of islands, whose inhabitants are akin to the Hawaiians, and whom it was thought would easily blend with the natives and invigorate the declining race. But the planters, being more solicitous of their profits than of the perpetuation of the fHawaiian race, would not incur the expense of importing women and children. Ience, the government was forced to carry out its plan itself, or let the planters carry out their plan. Two principles were thus brought into conflict which to-day are living issues in Hawaii. The vital 190On this topic see Bulletin No. 95, U. S. Department of Agriculture, pp. 78-82; W. D. Alexander, in the Annual, 1896; The Annual, 1894, pp. 70-78. 60 ECONOMIC HISTORY question in the islands is, which is the better policy, to build up the sugar industry, or to people the islands with intelligent citizens? In 1864 the Board of Immigration was formed, to execute the plan of the government, Three ordinances were passed, one prohibiting private persons from importing laborers, a second relating to the importation of immigrants as permanent settlers, and a third chartering a ship to import laborers from China to supply temporary needs, until the hoped for settlers should be found. The plans of the board were a little wider than those of the king as indicated above, as the inhabitants of the Azores, Canaries, and the Cape de Verde Islands were included in the list of peoples among whom free immigrants were to be sought. Later, India or any other country which might furnish desired inhabitants was favorably considered. Meanwhile, in the latter part of the sixties, the people, especially the mechanics and tradesmen, began to oppose the further introduction of Chinese coolies, who had been imported to supply urgent needs. An anti-coolie party was formed, and mass-meetings were held to consider the situation. Finally the Hawaiian Immigration Society, a private organization, was formed to carry out the project of the government, which had failed to accomplish anything of consequence in the way of securing desirable inhabitants. But the Society failed, doubtless from the same causes that thwarted the government. Among the various causes of failure on the part of the government to carry out its plans was the lack of funds necessary to import the desired laborers and their families. Another cause was no doubt somewhat of a surprise to the government, namely, its agents did not find the natives of the islands visited very anxious to leave their homes. And, moreover, some of those who were induced to emigrate did not prove satisfactory to the planters, and they were returned to their native islands. Sometimes the government found opposition in its own household, as when Mr. Wyllie, Minister of Foreign Affairs, antagonized the efforts of the king in 1865. The net result of all this conflict was to introduce into the islands the coolie contract labor system, which formed such a OF THE HAWAIIAN ISLANDS. 61 conspicuous feature of Hawaiian industrial life after the Reciprocity Treaty, made this feature more pronounced. The census of 1872 shows that there were in the islands in that year 1938 Chinese; and in 1878 the number had risen to 5916. B. Minor Crops. 1. Coffee. The only minor crops of any importance introduced by foreigners were coffee and rice. In 1823 Marin, a Spanish resident, experimented with coffee culture, and in 1825 Captain Lord Byron introduced a variety from Rio Janeiro.l19 Most of the plants died, and these early attempts failed. In 1842 a plantation was started by Messrs. Bernard and Rhodes, but they were met by many difficulties, among which were drouths and floods. But the industry spread until a large number of plantations were established on the four larger islands. They seemed to give promise of success, when suddenly the coffee blight appeared in 1857 and nearly destroyed the plants. A few years later many coffee plantations were converted into cane fields. The exports indicate the fluctuating fortune of the industry during this period. In 1850, for example 208,428 pounds of coffee were exported, and during the next year only 27,190 pounds; in 1857 the exports were 311,807 pounds, and in 1876 only about half that amount. At the close of the period, therefore, the coffee industry was in a declining condition. 2. Rice. The rice culture was introduced in the late fifties, and was doubtless due to the Chinese, who, as we have seen, were being imported at that time. The industry was from the first very profitable, and for a few years a "rice fever" prevailed. Taro and rice require about the same conditions for their growth, and taro patches were consequently converted into rice patches, until the price of taro rose so high that it was more profitable than rice, when many rice patches were reconverted into taro beds. 1876 the exports of rice and paddy (unhusked rice) amounted to about 3,700,000 pounds. 191For accounts of the early coffee culture see the Annual, 1876, pp. 46-52; Bulletin 95, U. S. Dep't of Agriculture, p. 54. ECONOMIC HISTORY CHAPTER VIII. Historical Sketch of the Reciprocity Treaty. Early Efforts. The history of the reciprocity treaty belongs to political history, but a very brief consideration of it will be helpful to the proper understanding of that most important factor in the economic development of Hawaii. The story is a long one, and carries us back to the year 1850, when it was feared, both in Honolulu and in Washington, that France intended to seize the islands.192 The foreign residents, mostly Americans, who had gained their way into the chief executive and judicial offices, and who made up the major part of the popular branch of the legislature, were secretly plotting to annex the islands to the United States. In this affair our agent at Honolulu took a leading part; but the government at Washington discouraged these efforts.l93 The" project of annexation being thus defeated, the foreign residents in Hawaii turned to reciprocity as a substitute. In 1852 the Agricultural Society petitioned the king for a treaty admitting free into Hawaii flour, lumber, staves and heading, fish and coal, products of the United States, and admitting free into the latter country sugar, molasses, coffee, and other products of Hawaii.194 It will be observed that the list of articles desired to be admitted free into Hawaii were those used by sugar planters. In the meantime the election of 1852 had placed new men at the head of affairs in Washington, and the idea of annexation was favored. Also, the foreign residents in Hawaii became more bold and talked openly of annexation. Their scheme was unintentionally aided by the French agent at Honolulu and the French sea-captains who frequented that port. Their conduct so harassed the king that he became weary of his crown and agreed to transfer the sovereignty of the islands to the United States. A treaty to that effect was nearly consummated, 192Foreign Relations, 1894, pp. 86-88. '9I1bid,, pp. 90-96, 102; The Friend, February, 1854. '14 The Polynesian, March 6, 1852. OF THE HAWAIIAN ISLANDS. 63 when the king suddenly died, before signing the document, to which he had given his verbal consent. His successor did not favor annexation, and the project failed.9'" From that time onward there was more or less agitation for annexation or reciprocity, some favoring one plan and some the other. Two reciprocity treaties came before the United States Senate, one in 1855 and one in 1867, both of which failed. But we must pass by these events, as they illustrate no new principle, and come down to the time just before 1876, when the planters were finally successful. Final Effort. In the latter part of the sixties, after the close of our Civil War, the planters renewed their efforts for annexation or reciprocity. Mr. Z. S. Spaulding, writing from Honolulu, April 14, 1869, says that the annexation feeling is strong and "the planters must have relief by annexation."'96 He says further that the Hawaiian government did not want reciprocity, but pretended to in order to prevent annexation. Mr. H. A. Pierce, our representative at Honolulu, writes to our State Department, February 17, 1873, that annexation and reciprocity are the two important topics of conversation among government officials and foreign residents, the latter favoring annexation and the former reciprocity.'97 In his report to our government, May 8, 1873, Gen. Schofield says that the great object of the Hawaiian government in seeking reciprocity had been and would continue to be to relieve its sugar planters from the operation of our tariff on that article, and that the planters were so anxious for free trade in sugar with the United States that many of them openly favored annexation. The members of the Hawaiian government and the natives, he adds, were not prepared for annexation.l98 In Honolulu mass meetings were held and speeches made, some for reciprocity, some for annexation.399 The cry of Hard Times is a favorite one among AngloSaxon people when they desire to make an impression on the 195Foreign Relations, pp. 106, 121, 123, 125, 131-32. 1961bid., pp. 147-48. 197Foreign Relations, p. 153. See also p. 152. 198Ibid., pp. 154-58. 199Bishop, pp. 184-6. 64 ECONOMIC HISTORY government, and experience teaches us that there is too often very little truth in the cry. But there seems to be no doubt that there was some financial depression among the planters. They frequently failed, and their plantations were often sold by the sheriff for one-third or one-fourth their cost.200 Of the thirty-four plantations on the islands in 1874 only six or seven were in the hands of their founders. The planters attributed this state of things to the lack of cheap and efficient labor and the low price of sugar. According to Willett and Gray, the average bond price (in gold) in New York of fair refining sugar was about 7.6 per cent lower during the three years 1873-75, than during the ten years previous to 1873.201 In addition to this general fall in the price of sugar doubtless there had been a special fall in California, (the market for Hawaiian sugar), owing to the completion of the Union Pacific Railroad, which gave the Pacific Coast access to the Eastern market. There seems, also, to have been special reasons, not connected with the fall in the price of sugar, which would partly account for so many failures, and possibly for all of them. The planters borrowed money and paid a higher rate of interest than could be made in the sugar industry; some estates were managed by superintendents who did not understand their business; and instead of clubbing together and shipping direct to San Francisco, the planters paid local agents 5 per cent for handling the sugar. Nordhoff, an intelligent observer, attributes the failures of the planters chiefly to these causes, and cites in proof of his position several prosperous planters who were not in debt and who managed their own estates. But whatever the causes of the failures of the planters, the hope of getting through our tariff wall would stimulate the cry of "hard times," even though the situation were not so bad as they and the orators pretended, for capitalists are anxious to increase their profits as well as to convert losses into gains. The general feeling among planters and business-men in Hawaii is probably expressed in the following extract from The Islander for March 12, 1875: 20~Ibid., pp. 184-6; Nordhoff, pp 58-61. 20~Sugar Trade Journal, 199, January 4. OF THE HAWAIIAN ISLANDS. 65 "Hawaii Nei awaits breathlessly for the news of the legislative action which shall give their trade and commerce new lease of life through the beneficient causes of a reciprocal alliance, or shut them up to their own resources, to fight out their own national battle as best they may without assistance." Stripped of its rhetoric, this simply means that the sugar industry hoped to get a bounty from theUnited States Treasury. And after a struggle of twenty-five years the planters got what they wanted. The treaty was concluded January 30, 1875, and went into effect September 9, 1876. Terms of the Treaty. The main features of the treaty were, (1) that Hawaiian raw sugar, molasses, rice, and a few other products were to be admitted into the United States free of duty, and that flour, grain, groceries, lumber, machinery, agricultural implements, cotton and manufactures of cotton, woolen goods other than ready-made clothing, and a long list of other articles, the products of the United States, were admitted free into Hawaii. (2). Solong as the treaty should remain in force the Hawaiian government should not "lease or otherwise dispose of or create any lien upon any port, harbor or other territory," or "grant any special privilege or rights to use therein" to any other power, (3) or admit free hy treaty from any other country the articles admitted free from the United States. (4). The treaty should remain in force definitely for seven years, and thereafter until twelve months after either party should give notice that it desired the treaty to terminate. In 1884 a treaty wrs concluded and in 1887 went into effect, renewing the treaty of 1876 and also containing a clause granting the United States the exclusive privilege of Pearl River Harbor, which had been refused by the Hawaiian government in 1875, under pressure, it is said, of the native feeling against it.202 The Treaty in Congress. According to the terms of the treaty, it required an Act of Congress to give it effect, and we are therefore so fortunate as to be able to examine the arguments for and against that measure that were in the minds of our legislators. 202Bishop,pp. 186, 316-17. For the texts of the two treaties, see Treaties and Conventions, pp. 546, 1187. 66 ECONOMIC HISTORY In turning the pages of the Record, one feels certain of two things, first, that the majority of the friends of the treaty believed that it would give greater security to our future Asiatic commerce, and, second, they considered that to be the most important phase of the question.203 Wood, of New York, voiced the sentiment of many when he declared that in the future our Asiatic commerce would be more important than our Atlantic, twice over. The immediate effect of the treaty in securing our Asiatic trade was not so much in view as the ultimate effect. The only provisions of the treaty which touched that side of the question directly was the clause stating that no special harbor privileges, etc., should be granted to any other nation, but it gave the United States no special privilege. It was believed, however, that reciprocity would so strengthen the American interests in the islands by increasing industry that they would naturally be annexed at some future time.204 Some, however, who favored the treaty did not desire annexation, but supported the measure on other grounds.20. It was urged, moreover, that if we rejected the treaty the planters would turn to England, which would result in annexation to that country. It was asserted that the English minister at Honolulu was at that moment attempting to defeat the final ratification of the treaty, and was endeavoring to negotiate a like treaty between his government and Hawaii, and that the authorities in Honolulu had avowed that they would enter into reciprocal relations with Great Britain if we refused the treaty.206 Professor W. D. Alexander also states that the English members of the Hawaiian legislature stubbornly opposed the treaty with the United States.207 It was considered that the treaty would keep England or any other country from acquiring the islands, because no special privilege was to be granted any other power, and in the meantime the American 203Record, pp. 190, 1424, 1463-64, 1492-94, 1497, 1600-1603, 2270, 5486, 5535, 5569, 5570. 20~4bid., pp. 190, 1463-64, 1492, 1494, 1600-1603, 2271-72, 5486, 5565. 205Ibid., p. 2273. 206Record, pp. 1425, 1596, 1600, 1603, 2270, 5570. 207Foreign Relations, p. 647. OF THE HAWAIIAN ISLANDS. 67 interests would be growing stronger and the danger of the islands falling to any other country than the United States would become less. Hence there would be the probability of losing all if we rejected the treaty, and of gaining all at some future time if we accepted it. In so far as the treaty would result in keeping out any other country, it would be considered as an immediate benefit. It is to be observed that annexation was not desired because of the intrinsic value of the islands, but primarily because they would give us harbors and coaling stations and, if need be, forts, all of which would be an aid and protection to our Asiatic trade. In time of peace we should have harbors and coaling stations of our own without having to ask any one for them, or to grant any further advantage to obtain them, with the possibility of being refused. In case of war, it was urged, they would be of special advantage, because the islands would be a dangerous point in the hands of an enemy, from which to sally forth and destroy our commerce, and, if we had them, we could likewise threaten the commerce of an enemy. And besides, we could enter the harbors for coal or repairs and remain as long as we liked. The fact that the islands were not wanted chiefly because of their economic value as determined by their productive capacity is clear not only from the stress laid on their indirect importance, but from the general attitude of both friend and foe of the treaty. But few had any idea of the possible resources of the islands. Kelley, for example, ridiculed the idea of 50,000,000 people desiring reciprocity with a handful of wretched beings struggling for existence on a few barren rocks.208 A few indeed pretty accurately estimated the future production of sugar. West, for example, said that the treaty would put $12,000,000 annually into the pockets of the planters.209 Some even exaggerated the future development of sugar, as did Senator Gordon when he declared that the treaty aimed a deathblow at the sugar industry of the South.2t0 These exaggerations probably did not arise from any positive knowledge of conditions in Hawaii. 208Record, pp. 1491-1496. 2091bid, p. 5488. 2loIbid, p. 5571. ECONOMIC HISTORY Besides the main argument for the treaty, that it would for the time being keep any other nation from getting the islands, and ultimately give them to us, thereby securing our Asiatic trade, two other arguments were advanced, namely, that the treaty would increase our trade with Hawaii and give the people of the Pacific Coast cheaper sugar. Let us briefly consider each of these as they were presented. It was argued that the treaty would stimulate industry in the islands, more people would emigrate to that, country, and hence, Hawaii's imports would be increased, and since we should have a monopoly of their market on all goods we imported into that country free, we should have an increased demand for our products. As a considerable portion of our exports to Hawaii came from the Pacific Coast, this argument had a special interest for that section.211 On the other point, that the Pacific Coast would get cheaper sugar. it was urged that Hawaiian sugar would not injure the sugar industry of the country because the amount imported would be too small to affect its price, and the distance by rail from California would act as a tariff for the South and East; and that, since "the consumer pays the tax," or at least a part of it, removing the tax from California sugar would give the people of that section cheaper sugar.212 The generalconception seemed to be that the Pacific Coast was economically separate from the rest of the country, and since the islands would furnish all the sugar for that section of the country, the removal of the duty on sugar would affect its price in the same way that the removal of the tariff on all sugar would affect its price all over the country. Those opposed to the treaty maintained that it would not make our commerce in the Pacific more secure than it would be without it, because we were granted no special privilege of harbors, etc.; and the treaty did not forbid Hawaii from making a treaty of offense and defense, nor from granting England or any other country the right of exercising the powers of a protector.213 211 Record, pp. 1463-1465-1599-2270-73-5567. 212Ibid, pp. 1420-1465-1493; Appendix, p. 55. 21sIbid, pp. 1423-1461-2276-3036-37. OF THE HAWAIIAN ISLANDS6 69 The idea that the islands would be of any advantage in time of war was denied, and it was asserted that that would prove our weak point because it would be easy to attack. Moreover, it was asked, why was it necessary to have an outpost in the Pacific any more than it was to have one in the Atlantic? England had possessions all around us, and there had been no cry of danger; and the idea of England invading the Pacific Coast was ridiculed. It was also urged that if England wanted to take the islands, by force if necessary, the treaty would not prevent it.214 As to the ultimate effect in bringing about annexation, the opposition was divided. Some claimed that it would not lead to annexation, because the industry of the islands would be stimulated, and the declining kingdom would be so invigorated that it would not want to be annexed. Others ridiculed the idea that the treaty looked towards future annexation, without offering arguments in support of their views. Others again opposed the treaty because it would result in annexation, and thus lead us on to a policy of future expansion. Others pointed out that even if annexation were desirable, reciprocity would make the islands unfit to be annexed, because it would fill them up with Chinese coolies.215 The opposition was more united in maintaining that the United States would lose more revenue than it would gain in trade, and that California would not get cheaper sugar. The amount imported, it was said, would be too small in comparison with our total imports of sugar to affect its price. Further, it was contended that since the price of sugar would not fall, planters and San Francisco capitalists would simply receive a bonus from the Treasury; and since that bonus would be greater than the value of our exports to Hawaii, we should lose more in revenue than we should gain in trade. Just why the bonus to the planters would exceed the value of our exports to Hawaii was not clearly pointed out. The idea seemed to be, however, that for some reason the exports of sugar from Hawaii would greatly increase without a corresponding increase of imports, especially of goods from the United States.21" 21 Record, pp. 1492-1497-3036-5490. 2 51bid, 1462-42-12497-2276-3036-5566-67-5570. 216Record, pp. 1422-1462-1490-1495-2275-3035-5486. 70 ECONOMIC HISTORY There was some local opposition to the treaty from the rice and sugar sections of the South; but this was not very strong, doubtless because, as we have noted above, few believed that Hawaii could produce any great quantity of sugar and rice. And it is very obvious that to contend that the amount imported would be so small that prices could not be affected, and at the same time maintain that the sugar industry of the South could be seriously hurt, would be an inconsistency apparent to the dullest mind.217 Politics played little or no part in the measure, as an analysis of the vote will show. The Democrats were pretty evenly divided, 70 voting for and 84 against; of the Republicans, 21 voted for and 19 against, while 67 did not vote at all. Of the Democrats only 14 failed to vote. New York voted solidly for, and Pennsylvania almost solidly against.218 Having hastily reviewed the main outlines of the history of the reciprocity treaty, we are in a position to see that on the side of Hawaii it was the result of the efforts, not of the Hawaiian people, nor of their government, but of a handful of sugar planters, and that from the side of the United States the main consideration was the indirect benefit that was anticipated. 2171bid, pp. 1497-2270-5489-5566-5567-557I. 281bid, pp. 3037-5572. OF THE HAWAIIAN ISLANDS. 71 CHAPTER IX. Economic Effects of the Treaty. I. General Effects. 1. Increase of Sugar. The news that the treaty was finally an accomplished fact brought great joy to the Hawaiian planters, and preparations were immediately made for extending the cultivation of sugar. Large quantities of machinery, agricultural implements, and other merchandise for plantation use were imported, and vigorous efforts were made to secure more laborers219 Exports of sugar suddenly rose in leaps and bounds. During the ten years, from 1866 to 1876, the exports of sugar rose from 17,000,000 pounds to 26,000,000 pounds, an increase of only about 53 per cent., and from 1873 to 1876 there was an increase of only 13 per cent. From 1877 there is a sudden expansion, the exports rising from 25,000,000 pounds in that year to 38,000,000 in 1878, an increase of 52 per cent. in one year; and during the next ten years exports rose to 216,000,000pounds, an increase of 468 per cent. The following table will illustrate the development from 1867 to 1899. Expansion of the Sugar Industry.22 (00,000 Omitted,) EXPORTS OF SUGAR YEAR Imports Exports Exports [11 _ I 1867...... 1,9 1,6 17,1...................... 1870....... 1,9 2,1 18,7....................... 1873....... 1,4 2,1 23,1.................... 1876....... 1,8 2,2 26,0 1,2 55 1877....... 2,5 2,6 25,5 1,7 65 1878....... 3,0 3,5 38,4 2,7 77 1880....... 3,6 4,9 63,5 4,3 88 1883....... 5,6 8,1 114,1 7,1 88 1886....... 4,8 10,5 216,2 9,7 93 1890....... 6,9 13,1 259,7 12,1 93 1895....... 5,3 8,4 294,7 7,9 94 1899....... 16,0 22,6 545,3 21,8 97 219Bulletin 95, Depart. Agri. p. 82; Summary of Commerce and Finance, July, 1901, p. 260. 22 See Appendix, Table III. 72 ECONOMIC HISTORY Such a development as is shown in the above table is indeed remarkable, especially when we take into consideration the fact that in 1867 sugar producing was the only great industry of the islands, the value of sugar exported being equal to about 65 per cent. of all domestic exports, and over 50 per cent of all exports. Hawaii rose from an insignificant position to that of one of the greatest sugar producing countries of the world. She has surpassed the Philippines and nearly equalled Louisiana, and her exports of sugar amount to one-fourth those of Cuba in her most prosperous years before the Spanish-Cuban war. The sugar culture has been so profitable that it has become the predominant industry in a more marked degree than it was in 1876. The above table shows that in 1899 sugar made up 97 per cent. of the value of all exports, as compared with 65 per cent. in 1877. It is to be observed that this somewhat exaggerates the situation, however, since some other products have been consumed in an increasing proportion. But according to the census figures the value of the sugar crop of 1899 was equal to 87 per cent. of the value of all the principal crops, including rice, coffee, fruit, vegetables, etc. As 1860 marked the beginning of more scientific methods of cultivation and the use of better machinery, so 1876 was the beginning of a new period of development. New lands were cleared up, vast tracts of waste lands reclaimed by anew system of irrigation, railroads were built and fertilizers used. In 1879 the first artesian well was sunk and the first of Hawaii's six little railroads was begun. Also, irrigation by gravity canals, on the windward side, was undertaken on a mammoth scale. The great Lowrie Irrigation Canal will illustrate what has been done along this line. The canal carries 60,000,000 gallons of water daily a distance of twenty-two miles, and over 6,000 acres of waste lands have been reclaimed. The reservoir, holding 120,000,000 gallons, from which the canal leads, is fed by two ditches which wind their way up among the hills.22' 2. The Cause of This Development is not hard to discover. Though the amount of sugar imported from Hawaii has been large for so small a territory, it has been small compared 221Annual, 1901, pp. 154-61. OF THE HAWAIIAN ISLANDS. 73 with our total imports of sugar. For the three years 1896-8, our imports of sugar amounted to about 9,400 million pounds, of which 1,282 million pounds, or about 14 per cent., came from Hawaii. In the earlier years a much smaller proportion came from the islands. The price of sugar in the United States could not be sensibly affected by the Hawaiian product so long as the great bulk of our sugar paid a duty. And it hardly need be pointed out that Hawaiian sugar could not materially affect the price of sugar in the world's market. The estimated crop of the world for 1899-1900 was 8,431,000 tons, and of Hawaii, 275,000 tons, or only about one-thirtieth of the total.222 The Hawaiian planter, therefore, got as extra profits just about the amount of the duty remitted by the United States, which equaled from 45 to 50 per cent, of the import value of the sugar during the years 1877-91, and about 40 per cent. from 1896 to 1899.223 If we reckon on the basis of what the sugar would have brought to the planter without remission of the duty, we fnd that the price of his product was nearly doubled. The case is so simple that statistical proof is hardly necessary, but the following table will enforce the argument: Average Price of Sugar in New York and Honolulu.'24 YEAR TExport Value NewYork uo-u The Same in YEAR |aExtport Honolulu tations for Fair Bond at Honolulu e fning Bond Refining, 1875............................... 4.84 6.88 4.38 1876................................ 4.88 7.53 5.03 1877................................ 6.95 8.41 5.91 1878................................ 7.03 7.18 4.68 1880................................ 6.80 7.58 5.08 1885................................ 4.88 5.02 3.06 1890............................... 4.69 5.01 3.05 1892................................ 72 2.81 2.81 1893.................. 3.08 3.20 3.20 1895................................ 2.70 2.925 2.11 1896................................ 3.36 3.157 2 14 1899................................ 4.02 3.92 2.48 222 Willelt and Gray Sugar Trade Journal, January 4, 1900. 2233Appendix, Table IV. 224Prices for Honolulu I have obtained by dividing export value by the number of pounds. Prices for New York are those given by Willett & Gray. 74 ECONOMIC HISTORY It will be observed that the export value of sugar at Honolulu suddenly rises to very nearly the market price in New York in 1878, and follows it more or less closely down to 1899. In 1892-93, when all sugar was admitted free, Hawaiian sugar drops with the market price in New York, and rises again after the restoration of the duty in 1894. The grades of sugar compared are not identical, the Hawaiian being probably a little better, especially during the later years, than the "fair refining," but this does not destroy the value of the conclusion to be drawn, for obvious reasons. And that conclusion is, that the treaty gave the planters enormous profits. Claus Spreckels, who certainly ought to know whereof he speaks, made the statement, which he doubtless knew would be published to the world, that during the years previous to the free sugar period in the United States, planters made 50 per cent. profits and sometimes more.225 Under such a stimulus it is not surprising that the production of sugar took a sudden leap forward and that the small stream of exports which had been going elsewhere for a few years previous to 1876 abruptly turned to the United States. During the period of free sugar in this country, 1891-94, there was much complaining among planters. Our consul-general at Honolulu reported that, "The decline in price of this important product [sugar] has forced the planters to exercise the closest economy in both production and manufacture, with the hope to secure sufficient profit to enable them to continue. "226 It is a little surprising that after eighteen years of expansion the industry held out hopes of profit after the value of sugar had dropped over 40 per cent., as the above table will show that it did between 1890 and 1892. But the exports show that the industry not only held its ground but actually advanced. In 1890 the exports, in round numbers, amounted to 259 million pounds, and for the next four years, 274, 263, 330 and 306 million pounds respectively. In 1890, the year chosen for comparison, the exports were about 7 per cent. greater than for any previous year. Such a decided advance could hardly be accounted for by sea225Foreign Relations, pp. 174-77. 226Consular Reports, 1892, Vol. 39, p. 412. OF THE HAWAIIAN ISLANDS. 75 sonal changes, especially when it is remembered that a large part of the sugar is produced by irrigation. For various reasons it is difficult to find out the actual profits in any industry, but such facts as have been obtained indicate that enormous profits are made in Hfawaii in producing sugar, particularly if we take into account the original value of the capital. The following table will assist in getting some idea as to the rate of profits in 1898:227 Cost of Producing Sugar and Profits on Stock in 1898. CCm an Cital Tons of Total Cost per Profits per Per ent of Company ock Profits of Ton of Profits Produced Sugar Sugar No. 1.....$ 600,000 7,763 $199,998 $44 $25 33-3 No. 2..... 500,000 8,400 276,227 35 34 54-'4 No. 3..... 750,000 6,914 243,557 34 35 32.47 No. 4..... 750,000 4,932 138,259 41 28 18.43 No. 5..... 2,000,000 6,198 198,991 37 32 9.94-% It must be borne in mind that interest on capital is included as a part of the expenses of production, which introduces a very uncertain element, especially in view of the fact that the stock is frequently "watered." For example, one corporation, not represented in the above table, started with a capital stock of $1,000,000, and afterwards, without any real increase of capital, the old stock was taken up and $5,000,000 of new stock issued in its place. And on this expanded capital its profits were estimated at 9 per cent. Company No. 5 in our table reveals similar conditions. These enormous profits are realized only by the original investors, because subsequent purchasers of stock would have to pay more than its par value, if profits were above the average. It should be noted that the profits indicated in our table are probably somewhat above the average rate. 3. Excess of Exports Over Imports. If the popular notion, that an excess of exports indicates prosperity, is necessarily true, Hawaii has been very prosperous since 1876, for her exports have been nearly double her imports. Until about 1880 imports increased faster than exports, owing to the demand for 227Progress of the Beet Sugar Industry, pp. 120-21. 76 ECONOMIC HISTORY machinery and other things for the new plantations. But exports soon increased, and they have continued to be greatly in excess of imports. During the twenty-three years, from 1877 to 1899 inclusive, the total value of goods imported amounted to about 150 million dollars, and the amount exported was 234 millions. The net imports of specie (not included in the above figures) amounted to 17 millions, leaving 47 millions as the balance in favor of exports.228 In his annual report for 1883, the Secretary of the Treasury of the United States attributed the continued excess of exports to the fact that the earrying trade of the islands was largely in the hands of Americans.229 That a large proportion of that trade has been in American hands is quite certain;230 but that could not account for all the excess of exports, for there were other causes which would also tend to make the balance "against" us. Many of the small planters were in debt to Americans,23T and a large portion of the capital invested in the sugar industry has been owned by foreign capitalists, chiefly Americans residing in San Francisco.232 In 1890 it was estimated that three-fifths of the capital was owned by Americans. In 1893 Claus Spreckels, Irwin & Co., owned one-third of the whole sugar product of the islands. Of the $31,000,000 invested in the sugar industry, 15'2 millions was owned in San Francisco. In 1898 the capital stock of the plantations was valued at $28,000,000, of which $16,800,000 was owned in California. Had all the capitalists who owned plantations in Hawaii, or who loaned to the small planters, lived in the islands, their profits and interest would have been expended in that country, and imports would therefore have been greater. Thus, instead of large exports and small imports being a good thing, in this case it was exactly the reverse for Hawaii, because so much wealth was taken from her without an equivalent return. 228See Appendix, Table I. 229Finance Report, p. XXXV. 230Summary of Commerce and Finance, July, 1901, p. 274. 218F. H. Allen, p. 4, 232 Whitney, Tourists' Guide, 1890, p. 140; Foreign Relations, pp. 975, 1082; Annual, 1898, pp. 51-52. OF THE HAWAIIAN ISLANDS. 77 II. General Effects Upon Hawaii. 1. The Small Planters. Since the bulk of the capital invested in the sugar industry has been owned by San Francisco capitalists and sugar refiners, who, as we shall see, controlled the sugar market on the Pacific Coast, the question arises, What benefit did Hawaii get from the treaty? And first, as to the small planters, did they get any higher price for their sugar, or did the big monopolists, the refiners, who also owned the large plantations, get all of the increased price? According to the statements of those in a position to know the facts, the small planters reaped part of the benefits of the higher price of sugar. The Hawaiian raw sugar is of a very high grade and will sell quite well in the market; and rather than have their monopoly threatened by the small planters offering their raw sugar for sale in San Francisco and other Pacific ports, the big refiners have given the small planters about the New York price for raw sugar of the same grade.233 2. Increase of Wealth and Public Revenue. The enormous expansion of the sugar industry was attended by a great increase of imports, as we have observed, which rose from a little less than 2 millions in 1876 to 3 and 4 millions in the eighties, to 5 and 6 millions in the nineties, and to 16 millions in 1899. Though the net profits on the other capital represented by these imports went abroad, the expenses of production went to laborers, merchants and others, and in so far as they were permanent residents of the islands, the country would be benefitted by the expenditure of the capital. Moreover, the development of the resources of the islands enhanced the value of real estate. Spreckels stated before the Ha'waiian Commission in 1893 that most of the fine houses in Honolulu had been erected since 1876, and that three-fourths of the wealth of that city had been accumulaten since that date.234 From 1892 to 1901 the assessed value of real estate rose from 18.3 millions to 58.5 millions, and personal property from 14.8 to 62.6 millions, or 233F. H. Allen, p. 12; Report of Committee of National Board of Trade, 1883, p. 8; Tariff Hearings, 1886, pp. 20-22-63-64. 234 Foreign Relations, p. 980. 78 ECONOMIC HISTORY taking both together, their value rose from 33 to 121 millions.235 The increase in public revenue, including the total revenue and some of the items composing it, will be seen in the following table: Public Revenue. (0,000 Omitted, except for Tax per Capita.) ITotal Customs Internal Internal Tax Revenue Receipts Taxes per Capita 1876...................... 1,00 $ 19.9 8 16 $2.84 1878.......................... 1,51 28 24 4.23 1880.......................... 1,0 40 31 4.76 1882....................... 2,07 50 37 5.29 1884.......................... 3,09 55 40 5.07 1886.......................... 3,01 58 41 4.67 1888.......................... 4,81 54 48 5.71 1890......................... 3,62 69 56 6.23 1892......................... 3,91 49 52 5.50 1.894...... 2................. 3,58 52 52 5.14 1896.......................... 2,38 65 69 6.32 1898.......................... 2,70 89 81 6.45 1899.......................... 3,95 1,29 1,06 7.91 The last column should be noted in particular. The internal taxes per capita increased nearly three-fold; and since the wealth of the natives makes a very insignificant figure, this increase in taxes indicates a great increase in the wealth of the foreign residents. In order to be absolutely certain that there was only an increase in the burden of taxes, without an increase of property, it would be necessary to knov the rate of taxation; but it is not probable that the whole increase in revenue from internal taxes was due to an increase in the rate, for suich an increase would have caused a great outcry among foreign residents. Whether or not there was any increase in the rate it is impossible to state from the data at hand. In the absence of data for all items composing the total revenue, we are forced to conclude by inference that the revenue from the sale and lease of lands continued to form a considerable portion of the total revenue. As the sugar industry developed, as better machinery was used, and the system of irrigation by artesian wells was introduced, land would rise in value generally, and that formerly of no commercial value would 235 Report of Government of Hawaii, p. 53. OF THE HAWAIIAN ISLANDS. 79 be brought into the list of valuable property. Mr. Brown, commissioner of public lands for Hawaii, says: "The revenue from rent of lands has steadily increased, although the area of lands leased has in the same period been reduced by many thousands of acres.""23 It is not clear as to what period he has in mind, but he gives figures only for the years 1890-98, the rental of Government and Crown lands amounting in the former year to $80,268 and in the latter to $95,225. In 1901 the revenue from land sales amounted to $36,124.39, and that from leases, $104,819.91, though the bulk of the bestpublic lands have been disposed of -23 3. Cheaper Goods. Hawaiian planters got a higher price for their sugar because their whole product formed but a small portion of our total imports of sugar. But the goods from the United States entering Hawaii free made up only a fraction of our exports of those articles. It goes without proof that all the goods Hawaii purchased from us could not effect materially their price in this country. Their wholesale price in Hawaii would be the price in the United States plus the cost of transportation, because, being free to buy in this country in the open wholesale market, and being able to get all they would want of that grade and kind of goods, without sensibly affecting the supply in this country, Hawaiian dealers would not be forced by competition to pay in our markets a higher price than that formerly paid, before the removal of the Hawaiian tariff. Therefore, on all goods which Hawaii would have been compelled to purchase in the United States in any case without remission of the duty the price in Hawaii would be lowered to the full extent of the duty remitted. The price of goods which she could have got elsewhere nearly as cheaply with the duty as she could get them in this country with the duty remitted, would not fall to the extent of the duty remitted. The goods which Hawaii would doubtless have purchased in this country in any case were grain and feed, groceries and provisions, flour, cotton cloth of the coarse grades; agricultural implements, machinery of certain kinds, (though she continued to get machinery elsewhere), and California fruits. These make up the great bulk of goods ad23eBulletin No. 95, Dept. Agri., p. 91. 237Report of the Government of Hawaii, p. 51. 80 ECONOMIC HISTORY mitted free into Hawaii. It is possible that she might have got some of these things from some other country had there been no reciprocity treaty, but it is quite probable that the most of them would have come from this country. It is to be observed that a number of articles enumerated above, such as machinery, agricultural implements, etc., were used exclusively by the planters. Such goods make up about one-fourth or one-fifth of all imports from the United States free by the treaty238 Of the other goods which make up the bulk of free goods (together with these just mentioned), including flour and groceries for their laborers and grain and feed for their work-animals, the planters would also use a very large part. Thus they succeeded in shifting a considerable portion of the burden of taxes on imports upon other classes of the community, and gained a special advantage from the treaty in both directions, for they got more for what they sold and paid less for what they purchased. 4. Increase of Population. One of the most notable effects of the reciprocity treaty was to check the decrease of the total population which had been steadily going on. This increase came from three distinct sources, Europeans and Americans who went there as capitalists or as skilled workmen, imported Portuguese, and Chinese and Japanese coolies, who were imported as plantation laborers, or who, later, came of their own accord. The following table will illustrate the changes in the population from 1853 to 1900: (For the sake of simplicity I have not considered the effect of annexation upon nationality,) 238Summary of Commerce and Finance, July 1901, p. 264. OF THE HAWAIIAN ISLANDS. 81 Population by Nationality.239 NATIONALITY 1853 1872 1878 1884 1890 1896 1900 Hawaiian............... 70,036 49,044 44,088 40,014 34,436 31,019 29,787 Part Hawaiian......... 983 1,487 3,420 4,218 18 86 8,485 7,848 Hawaiian-born foreig's. 309 849 947 2,040 7,495 13,733 21,296 Americans.............. 692 889 1,276 2,066 1,928 2,266 4,290 British.................. 435 619 883 1,282 1,344 1,538 1,893 Portuguese.............. 86 395 436 9,377 8,602 8,232 6,512 Chinese................. 364 1,938 5,91617,93715,301 19,382 21,741 Japanese............................. 116 12,360 22,329 56,234 Others.................. 233 676 1,19 3,52 2,738 2,036 4,500 Total........... 73,138 56,897 57, 985 80,578 89,990 109,020 154,001 A table showing race instead of nationality would serve our purpose better, but it happens that such a table would not differ greatly from the one above, The Hawaiian-born foreigners have been largely of Caucasian blood, as the Chinese and Japanese have been merely a temporary part of the population, being as a rule unmarried men who remained in the islands but a short time. Of the 21,296 Haw'aiian-born foreigners in 1900, 12,156 were Caucasians, 4,881 were Japanese, and 4,021 were Chinese, the remainder being South Sea Islanders and Negroes. The census of 1872 shows the low-water mark in population. Up to about that time the increase of the foreigners had not been sufficient to offset the decrease in the natives. After 1872 the tide turns and rises more rapidly than it had fallen. This rise was due chiefly to the Chinese, during the early part of the period, and in a less degree to the Portuguese, and during the later years the Japanese have come like a great flood-tide, far out numbering all other nationalities. Throughout the period the Hawaiian-born foreigners have been increasing at an accelerating rate. As we shall have occasion to study the nature of the population at the present time in more detail in the next chapter, let us pass to the consideration of the subject which is closely bound up with the question of population, namely, the subject of labor. 239Summary of Commerce and Finance, July, 1901, p. 86; Report of the Corn. of Labor, pp. 27-29. ECONOMIC HISTORY 5. Labor. As observed in a former chapter, there had been for twenty-five years previous to 1876 a call for labor for the plantations, and in 1864 the Government stepped forward and took control 6f immigration, with the purpose of obtaining citizens. In 1876 there was a sudden demand for more laborers and the "labor question" soon became a pressing one.240 The natives were not attracted to the plantations, not being fond of hard work, and many of them, moreover, were able to satisfy their few wants from the produce of their little patches of land. And they were decreasing so rapidly that there would not have been enough of them to satisfy the growing demand for labor had all been obliged to work for wages. It became necessary, therefore, for the gove rnment to supply laborers, or by inaction prevent the growth of the sugar industry, which was the very life of the islands. The board of immigration made strenuous efforts to get a class of laborers who would make good citizens, and it turned in various directions to find them. In 1878 a few Portuguese from Madeira were secured, and as they proved satisfactory, negotiations were entered into to introduce them on a large scale.241 The above table will show that about four hundred Portuguese had been added to the population previous to 1876. These came from the Azores, which continued to furnish citizens and laborers, but after 1878 the majority were obtained from Madeira. They have proved to be efficient laborers and thrifty, patient, industrious citizens. They form a considerable portion of the Hawaiian-born foreigners now on the islands. At the same time that the Portuguese were first introduced from Madeira the South Sea Islands were again searched for prospective citizens. Several shiploads were introduced, mainly from the Gilbert Islands; but they were not satisfactory either as laborers or as citizens, and most of them have been returned. The census of 1884 shows that there were then 956 Polynesians in the islands, while in 1900 there were but 593 from all Pacific islands, excluding the Philippines. Meanwhile, agents were sent to various countries of Europe 240NVicholson, p. 62. 24"Bulletin No. 95, Department Agriculture, pp. 82-84. OF THE IAWAIIAN ISLANDS, 83 in search of citizens. In 1881 two shiploads of Norwegians were obtained, and a little later several shiploads of Germans. The project of importing negroes from the Southern states was considered by the board, but the decision was adverse to the plan. None of these efforts have resulted in any great success In 1884 there were 1,600 Germans on the islands, and in 1900 there were 1,154. Of the Norwegians there were 384 in 1884 and 198 in. 1900. The climate and general conditions do not seem to suit the inhabitants of northern Europe. Until about 1884 the board of imnigration had confined its efforts to finding citizens who would also be good laborers, but they were not able to satisfy the demand for labor, and it again turned to Japan. In 1885 a labor convention was concluded with that country and the importation of laborers under contract began on a large scale. In 1884 there were 116 Japanese on the islands; in 1890 there were 12,360. Since 1885 Japan has supplied the great majority of laborers on the plantations, importation under contract continuing,lzntil the islands were annexed to the United States. While the government was endeavoring to get citizens and the plant,, ers were clamoring for laborers, the Chinese began to come of their own accord, and after 1878 the influx was rapid. rhe census of 1884 shows that there were then 17,937 of them in the country, and in 1.886 it was estimated that there were 21,000, Somre of them found work on the plantations, others went to raisin g rice and vege ables, and many began to enter the industrial and mechanical trades, The white and native laborers in these trades raised the cry that they were being crowded out. 242 Public meetings were held, the legislature was petitioned, and various laws were passed restricting Chinese inimigration. In the meantime the government had been making endeavors to stop the invasion. All seemed to be coming from Hongkong, and in 1881 a dispatch was sent to the governor of Hongnkong to stop the emigration of Chinese from that port to Hawaii., In 1883 another dispatch was sent, but it proved ineffectual, and 242 The Annual, 1890, pp. 81-90; also, see reference above to Builletin, 95, pp. 82-84. 84 ECONOMIC HISTORY finally, after passing various regulations, a law was enacted in 1886 forbidding the landing of any Chinese passenger without a passport. These efforts checked the incoming tide. There were in 1900 about three or four thousand more Chinese than in 1886, counting those born in the islands. In one important respect the anticipations of the opponents of the reciprocity treaty were realized, namely, the islands have become a colony of coolie laborers. In 1900 the Chinese and Japanese together, counting those born in the islands, formed about 56 per cent of the total population of the Territory. We have no complete statistics as to wages previous to the census of 1900. Such data as we have indicates that from 1875 to 1900, (before annexation raised wages generally, as we shall see later), there was an advance in the rate of wages, but only a slight advance. Nordhoff states that the usual rate for Chinese field hands was $8 a month, with board, or $11 without.243 It is estimated that previous to annexation the usual rate of wages for Chinese and Japanese field hands was from $12.50 to $15 a month, without board.2 4 III. Effect of the Treaty Upon the United States. 1. Political and Indirect Effects. In. judging the merits of the treaty it should be borne in mind that political considerations were mainly urged in its favor. The chief economic benefits hoped for were those that were expected to result from the aid and protection that would be afforded to our commerce with Asia. History has proved the soundness of the political argument; the islands are now a part of the United States. But whether or not they are actually of any benefit as an outpost on the highway of Pacific commerce, or if it be acknowledged that they are of some benefit for that purpose, the extent of it, would be impossible to determine from the very nature of the case. The extent of our future commerce towards the west is unknown; and if it were known, the commercial value of the aid afforded could not be determined, for obvious reasons. Moreover, if the islands had not been annexed, or even if they had 24 3Northern Cal., etc., pp. 63-64, 244Summary of Corn. and Finance, November 1899, p. 1333. OF THE HAWAIIAN ISLANDS. 85 fallen into the hands of some other power, it would not follow that we would be deprived of coaling and harbor privileges in times of peace. Our ships could enter the harbors and supply themselves with whatever they might desire, just as readily as they can today. It could hardly be imagined that any modern civilized nation would have denied us those privileges. In time of war between this country and some other power, the rules of international law would also allow us the ordinary privileges accorded to belligerents in neutral ports. And in case of war with the nation to which the islands should belong, it would not be at all certain that the islands would be more easy to defend than to attack. On the whole, though we may have a feeling that the islands are of some benefit to us, indirectly, we could not state the amount of it in definite terms. It would be impossible, therefore, to compare the supposed gain with the gain or loss that has been the direct result of reciprocity. With these general observations, we may pass to the consideration of something more definite and tangible 2. Loss in Revenue and Gain in Trade. The total amount of duty remitted on Hawaiian sugar and molasses imported into this country from 1877 to 1900 inclusive amounted to about $84,000,000.245 Since the Hawaiian product could have had little effect upon the world price of sugar, it is quite evident that the consumption of sugar in the United States would have been the same as it has beet. Even though there had been no increase in the product of Hawaii, other sugar-producing countries would have been glad to sell us at the prevailing price as much sugar as we got from the islands. The $84,000,000, therefore, which we gave the planters and refiners represents the loss to the United States Treasury. And since the government would doubtless have lightened the burden of taxation at some other point, had it received the revenue on sugar, the $84,000,000 also represents the amount taken out of the pockets of the American people.246 Let us now see what we gained in trade to offset this loss. 245 Appendix, Table IV. 246The loss was really a little more than $84,000,000, as we have not considered the duty remitted on other goods. 86 ECONOMIC HISTORY During the same period in which we lost $84,000,000 of revenue from sugar, 1877-1900, we exported to Hawaii about $85,000,000 worth of domestic product. Our exports to Hawaii have formed but an insignificant part of our total exports. In 1900 our domestic exports to Hawaii amounted to $13,077,506, and our total domestic exports to $1,370,763,571, 247 or more than one hundred times the exports to Hawaii. But this exaggerates the situation in favor of Hawaii, since our exports to that country for 1900 were unusually large. Taking the averages for the twenty-four years, our total annual domestic exports have been about 200 times greater than our domestic exports to Hawaii. Had we not been able, therefore, to find any other market for the goods sent to Hawaii, prices would not have been materially affected. We might, then, for the sake of the argumert, grant that we should have lost the sale of $85,000,000 worth of goods, had we not granted the treaty to Hawaii. In that case, we gave as a free gift to planters and refiners $84,000,000 for the privilege of selling them $85,000,000 worth of goods. But we are not warranted in assuming that Hawaii would have purchased no goods from us had we refused the treaty. Had she not secured a reciprocity treaty with any other country and consequently not increased her commerce, we should in all probability have continued to sell her as much as we had been selling her, which was about $700,000 worth yearly. And had she secured a treaty with some other power, we should have continued to sell her considerable quantities of some kinds of goods, such as agricultural impleplements, agricultural products, fruits, etc. Unless, therefore, there were some compensating advantages, we made an exceedingly bad bargain from an economic point of view, for the price of our products was not sensibly increased nor our markets materially widened. 3. Benefits to the Pacific Coast. The only important economic advantage we could hope for to compensate us for the loss of revenue would be to get cheaper sugar. But we have already seen that the Hawaiian product had no apparent effect upon the price of sugar in the United States generally. It might 247Statistical Abstract, 1901, p. 92. OF THE HAWAIIAN ISLANDS. 87 be thought, however, that the consumer on the Pacific Coast gained a little, for had his sugar, or any considerable portion of it, come from the Atlantic seaboard he would have had to pay the New York price plus freight between the Atlantic ports and San Francisco; and if the treatv7 should result in so developing Hawaii that she could more than supply the demand on the Pacific Coast, it might have been expected that competition would reduce the price to about that on the Atlantic Coast. But there has been practically no competition on the Pacific Coast from 1877 to the present time. The San Francisco refiners have had control of the chief part of the sugar crop, and they have been able to control the market. Nearly all the sugar produced in the islands has passed through the hands of the refiners, and hence very little raw sugar has been put upon the market.248 In order to know, therefore, the actual price to consumers, we should have to know the market quotations in San Francisco for granulated sugar. But unfortunately San Francisco quotations have not been systematically recorded and averaged, as have the New York quotations. Such scraps of informaaion as we have on the subject, howvever, indicatethat the monopolists in San Francisco put upon the market there just enough to supply the demand at the New York prices plus freight from that point, and shipped the remainder over the mountains to places along the Missouri and Mississippi Rivers, or later, around Cape Horn to Atlantic ports.249 And this is just what we should expect under monopolistic conditions. Occasionally the small planters have attempted to combine and build a refinery on the Pacific Coast, but the big refiners would lower prices until their rivals were crushed, when prices would go up again.250 At the present time the American Sugar Refining Company, commonly known as the Sugar Trust, controls the refineries on the Pacific Coast, and prices in San Francisco and New York are about the same.251 On the whole, even the small benefits hoped for in the saving of freight bills have not been realized. It might be con248 Tariff Hearings, 1886, pp. 63-81. 249 Tariff Hearings, 1886, pp, 16-21; Tariff Corn. Report, pp. 675-695 -1224; Pacific R'y Corn Report, p. 3319. 250 Tariff Hearings, 1888, pp. 17-63. 25lIndustrial Corn. Report, XlII, pp. 827-850-927. 88 ECONOMIC HISTORY sidered, however, that the consumers in California, and other Pacific States, have at last received some benefit, since prices there are now on a level with those in New York. But the combination of the Eastern and Western monopolists to form a still bigger monopoly could hardly be attributed to the reciprocity treaty. It has been claimed that the reciprocity treaty was the cause of the monopoly on the Pacific Coast 2"2 But it cannot be proved that a monopoly would not have arisen had there been no treaty. Geographical situation is an obvious and sufficient cause of the monopoly. And had there been no sugar imported from Hawaii, the monopolists might have got their sugar somewhere else. At any rate, the monopoly on the Atlantic Coast was not created by the treaty. 4. Hawaiian Sugar in the Mississippi Valley. As early as 1880 the Hawaiian sugar supplied the whole Pacific Coast, and from that time larger and larger quantities were shipped across the mountains to Omaha, St. Louis, St. Paul, and other points along the Mississippi and Missouri Rivers. The Pacific refiners made agreements with the various railroads, whereby the latter were to haul sugar from San Francisco to the various points mentioned above for fifty cents a hundred in carload lots,253 These low rates, together with the fact that Hawaiian sugar was free from duty, enabled the western refiners, who owned most of the products of the islands, to undersell their rivals. The result of this contest between the eastern and western refiners was, that the consumers in the heart of the continent got sugar a little cheaper than those on either seaboard. During the period of free sugar in the United States the Pacific refiners, no longer having a special advantage over those in the east, were willing to give up the contest. An agreement was made that the Pacific refiners should ship no sugar east of the Rockies, and the Sugar Trust, which had been formed in 1887, was to take their surplus sugar at a stipulated price. When the duty on sugar was again restored, in 1894, the Pacific re252Report of Committee of Nat, Board of Trade, p. 1. 253 Tariff Corn., p. 675; Tariff Hearings, 1886, pp. 18-78-239-695; Pacific R'y Corn., pp. 3319-21; Inter-State Corn. Corn. Report, p. 41. OF THE HAWAIIAN ISLANDS. 89 finers, being exempt from the duty, renewed the contest.254 But, as was noted above, the Sugar Trust soon got control of the Pacific refineries, and the conflict ceased. In 1900 former conditions as to relative prices were reversed, sugar being considerably higher at interior points than on either seaboard25"' This is what one would expect under normal conditions, since imported sugar has to pass through the seaports to reach the interior. 5. Competition With Home Producers. If the price of sugar throughout the United States generally was not materially affected by Hawaiian sugar, (and it has been seen that such was the case) the profits of the home producers could not have been seriously affected. But Louisiana planters began to complain in the early eighties that they were being driven from their local markets; and when the beet sugar industry developed in Nebraska and other states of the West, similar complaints were heard from that quarter.2'5 There is no doubt of the fact that the prices of sugar in the markets of the world have greatly fallen during the last twenty-five years, and that the price in the United States has fallen in a like ratio, except in so far as the general change has been locally modified by our tariff on sugar. Sugar producers would, as a matter of course, suffer from that fall in prices, cost of prodction remaining the same. But that fall in price has certainly not been caused b v the development of the Hawaiian industry. Nevertheless, it may be considered that the treaty was the cause of the local reduction of prices in the heart of the country, where the two streams of sugar met. If we grant this, it still remains true that the extent of the reduction in price was slight, and the number of consumers affected was small. The sugar producers of the country happened to be in the narrow strip of territory where prices were lowered, and this no doubt would injure them a little. But outside of this narrow margin were markets unaffected by Hawaiian sugar, and all they would lose would be the freight on that part of their sugar which they would have sold in their local markets. 254 Tariff Corn., pp. 695-1224; Inter-State Corn. Com.,1893, p. 29; 1900, p. 41; Industrial Corn. Report, I, pp. 61-104. 255Industrial Corn Report, X1rI, pp, 827-65. 256 Tariff Hearings, 1886, pp. 18-78-239; 1896-97, pp. 650-673. 90 ECONOMIC HISTORY Summary. The most marked effects of the reciprocity treaty have been to develop the Hawaiian sugar industry, to annex the islands to the United States, and to enrich a few capitalists at the expense of the American people. We may draw from this at least one lesson which may be of service to us. In outlining a commercial policy it will be well to observe that reciprocity with one country may not be the same as reciprocity with another. Reciprocity with any country that would furnish us with only a small part of what we buy and take but a small fraction of what we sell could have no other result than that of enriching that country at our own expense. It gets through our tariff wall with its little parcel, sells it at a high price, and supplies itself with what it needs without disturbing the price of what we sell it, and without materially widening our market. And in most cases we probably should not be so fortunate as to get back a part of our gift, as we did in the case of Hawaii, from the fact that the capitalists who reaped the chief part of the benefit were our own citizens and resided in this country. OF THE HAWAIIAN ISLANDS. - 91 CHAPTER X. Present Conditions and Future Prospects. Population. The population of the Territory in 1900 was 154,001, over ninety-eight per cent of whom resided on the four larger islands.25' Oahu is third in size but first in the number of its inhabitants, owing to the fact that it contains the city of Honolulu, with its population of 39,306, the only city of any importance on the islands. This one island has a population of 58,504, or more than one-third of the total for the Territory. The population of the other islands is as follows: Hawaii, 46,843; Moui, 25,416; Kauai, 20,562; the three small islands together, 2,672. The general character of the population is shown in the following table: Population in 1900 by Race, Sex and Age.258 UNDER 21 21 AND OVER RACE MALES FEMALES TOTAL Males Females Males Females Hawaiians....... 15,642 14,157 29,799 6,763 6,331 8,879 7,826 Part Hawaiians. 3,971 3,886 7,857 2,749 2,677 1,222 1,209 Caucasians...... 16,531 12,288 28,818 7,281 6,958 9,250 5,330 Chinese......... 22,296 3,471 25,767 3,701 2,226 18,595 1,345 Japanese........ 47,508 13,603 61,111 6,168 3,915 41,343 9,688 So. Sea Islanders 263 152 415 38 34 225 118 Negroes.......... 158 75 233 65 55 93 20 Total........ 106,369 47,632 154,001 26,762 22,096 79,607 25,536 Two important facts are revealed in this table; first, the overwhelming predominance of the Mongolian race, (to which we have before alluded), and second, the large proportion of males compared with the females. This is particularly true of all the foreign races. Looking at the population as a whole, it is seen that the males outnumber the females more than two to one. This would be an undesirable condition; but the adult males outnumber the adult females more than three to one. Our table, however, does not bring out the worst features of the situation. The great mass of the population is densely 257Census Bulletin No. 15. 258Report of Corn. of Labor, Hawaii, pp. 29-45. (These figures include both native and foreign born.) ECONOMIC HISTORY ignorant, 98.52 per cent of all persons ten years of age and over being unable to read and write.259 Even the Caucasians are below this general average, 98.74 per cent of those ten years of age and over being totally illiterate. This is due to the large proportion of Portuguese laborers. The Chinese and Japanese are not only illiterate, but they are the lowest classes of Asiatics in general intelligence and morality.260 In such a community there certainly would not be the elements desirable in a state of the American Union. Education. There is surely much need of education in Hawaii, and the legislators have been aware of the fact. All children between the ages of six and sixteen years, not physically disabled, are required by law to attend school.261 The general conditions as to number of schools, etc., are shown in the following table: Number of Schools, Teachers and Pupils, in 1900. TEACHERS PUPILS KIND OF NOO. OF _ ____........ SCHOOL SCHOOLS Males Females Total Males Females Total Public....... 140 112 240 352 6,339 5,162 11,501 Private...... 55 78 129 207 2,235 1,801 4,036 Total..... 195 190 369 559 8,574 6,963 15,537 There were in 1900 33,774 children of school age (5 to 20 years inclusive), and only 15,537, or less than half, attended school This shows that the majority of children do not attend school after they have reached the age of sixteen years. The number of children between the ages of six and sixteen is not given in the data before me, but as there were 3,608 more children under ten years of age than there were between ten and twenty, it would seem that there were not more than about 15,500 between six and sixteen. In other words, the law requiring attendance seems to be pretty well enforced. Attendance was quite regular, 89.69 per cent of all those who went to school being in attendance six months or over during the year. It will be observed that there are a relatively large number 2"9Report of Corn. rf Labor, Hawaii, p. 127. 260Progress of the Beet Sugar Industry, p. 122. 26lReport of the Governor of Hawaii, pp. 72-74; Report of the Corn. of Labor, Hawaii, pp. 40-115-28. OF THE HAWAIIAN ISLANDS. 93 cf private schools. This is doubtless due to the mixed character of the population. Nearly one-half of the private schools are in Honolulu, there being in that city twenty-six private schools and only twenty public schools. Of the 559 teachers in the Territory, 299, or more than half, were Americans, 64 were Hawaiians, 58 were part Hawaiians, 59 were British, the remainder being of various nationalities, includingPortuguese, Chinese, and Japanese. Thhe schools, both public and private, are in general well equipped, but the public schools have suffered somewhat for the lack of room, the department of education having been "seriously hampered for want of sufficient funds for the erection of necessary school buildings to accommodate the increasing school popuiation."262 Schools are regularly visited by traveling inspectors, who examine the general condition of each school and make such suggestions to teachers as seem appropriate. Salaries of teachers in the public schools vary with length of service and the number of pupils enrolled, and range from $660 to $1,500 a year. The principals of the five leading public schools receive $2,400 a, year, without regard to length of service. Occupations. In a community in which nearly 39 per cent of the population are adult males, one would expect to find a large proportion of the people engaged in gainful occupations, and such is the case in Hawaii. During the census year 1900, 90,172 persons, or 58 55 per cent of the total population, were thus engaged 263 The following table will show the chief occupations of the people! as a whole and of the different races: Number of Persons in Each Occupation, by Race or Color. Hawaiians Occupations, and Part Caucasians Chinese Japanese Others Total Hawaiians Agriclitural ParsiAts — Agricultu -:a laborers............. 754 709 9,781 37,093 61 48,428 Farmers, planters and overseers....1,573 1, 080 2,389 1,397 11 6,390 Other agricultural pursuits........ 340 174 279 441 4 1,238 Total........ 2,697 1,963 12,389 38,931 76 56,056 262 Report of the Governor of Hawaii, p. 72. 2" See Report of the Corni. qf Labor, Hawaii, pp. 79-99. Table of Occupations-Continued. Hiawaiians Occupations. and Part- Caucasians Chinese Japanese Others Total Hawaiians Professional ServiceActors, theatrical managers, etc............. Clergymen............. Engineers (civil, mechanical, etc.) and surveyors Lawyers................ Official (government).... Physicians and surgeons Teachers, professors in colleges, etc......... Other professional services................... Total......... Domestic and PersonalService Engineers and firemen (not locomotive)........ Laborers (not specified). Launderers and Laundresses.............. Servants............. Other personal service... Total.......... Trade and TransportationBankers, officials, etc... Boatmen, canalmen, etc.. Bookkeepers and accountants................... Clerks and Copyists..... Draymen, teamsters, etc. Foremen and Overseers.. Merchants and Dealers.. Salesmen and saleswomen Others................. Total......... Manufacturing and Mechanical PursuitsBakers and food preparers Blacksmiths......... Boot and shoemakers.... Butchers.............. Carpenters and joiners.. Fishermen............... Iron and steel workers.. Laborers (sugar mill)... Machinists............ Manufacturers, officials, etc..................... Masons (brick and stone) Painters, glaziers and varnishers............ Printers and pressmen.. Straw workers.......... Tailors,dressmakers, etc. Others.................. Total......... GRAND TOTAL....... I 1 [ 19 53 26 85 78 2 132 41 49 90 154 80 96 75 406 154 22 9 1 3 3 9 26 6 1 23 27 1 2 9 23 15 15 2 5....... S 114 180 181 170 188 109 579 221 436 1,104 79 92 31 1,742 75 366 73 122 3 639 3574 2,326 1,245 2,301 132 9,578 35 63 549 315........ 962 148 202 1,494 1,951 11 3,806 431 710 252 467 8 1,868 4,263 3,667 3,613 5,156 154 16,853 28 128 17 17 1 91 244 147 12 59 9 471 32 290 151 43........ 516 290 481 239 211.. 1,221 398 397 118 343 7 1,263 5 15 1 3...... 24 46 302 819 328 1 1,496 64 118 227 177...... 586 215 345 197 324 1 1,082 1,322 2,223 1,7831 1,505 19 6,850 8 20 255 55... 338 88 181 23 103 4 399 2 35 85 4..... 126 36 53 108 11....... 208 433 537 334 649 2 1,955 582 7 19' 263 19 1,069 102 58I 1 4 7 172 4 14 100 386 2 506 21 116 3 21...... 161 13 101 47 60........ 221 20 162 1 46 1 230 172 97 75 55 3 402 67 54 3 14 1 139 80......... 1 18 60 159 161 133 474 373........1,141 251 640 225 307 22 1,445 2,040 2,208 1,933 2,369 121 10,758 11,165 19,795 148,053 401 8,671 90,172 OF THE HAWAIIAN ISLANDS. 95 The most striking fact about this table is, that the agricultural group embraces about 62 per cent of all those engaged in remunerative occupations. The number of those in the various professions is small, as one would expect in such a community as that of Hawaii. But the domestic and personal service group is unusually large for a society in which it would not be supposed that many could afford to expend much upon personal service. A glance at the various occupations of the group, however, reveals the fact that the majority in this group are classed as laborers "not specified," which doubtless means that they have no particular calling. Each of the remaining groups is small, which fact again magnifies the importance of the agricultural group. According to the census of 1890, the percentages for those engaged in the manufacturing and the trade and transportation groups in the United States were respectively 22.4and 14.7, while the above table shows that in 1900 the corresponding percentages for Hawaii are 9.6 and 7.6. Looking now at the individual trades in each group, it is seen that nearly 87 per cent of the agricultural group are laborers, the most of whom are Mongolians. About 52 per cent of all persons engaged in gainful occupations are Mongolian agricultural laborers. Let us now consider the different races. Had we no other facts to base our conclusions upon than those presented in our table, it would be quite clear that the whites are the leaders and that they occupy most of the places requiring the highest intelligence and skill. The great majority of the professional classes are whites, and they also include most of the trained workers in the other groups. It is not to be understood that the majority of the Caucasians are occupying places of responsibility and trust, for it must always be remembered that the Portuguese laborers form a large proportion of the whites. Next to the whites, the Hawaiians and part-Hawaiians furnish the largest percentage of trained workers in proportion to their total number engaged in gainful occupations. 5'hey also apparently include the largest number of idlers found in any one class, not only proportionately, but absolutely. For example, of the laborers "not specified" the largest number belonging to any one race -I 96 ECONOMIC HISTORY are Hawaiians and part-Hawaiians, and more than half the fishermen are of this class. Moreover, the Census figures show that during the year 1900 a larger percentage of Hawaiians and part-Hawaiians were unemployed some portion of the time than of any other of the four leading races. Over 25 per cent of the Hawaiians and part-Hawaiians were idle during some portion of the year,while theaverage for all theraceswas only 15.24 per cent. 26'The great majority of Chinese and Japanese are unskilled laborers, though both nationalities furnish quite a large number of trained workers and independent men of business. Most of the skilled workmen, however, are employed on the plantations, and the work is such that no great skill is required, and the pay is low. On thirty-eight sugar plantations, for example, 517 Japanese carpenters were employed at an average wage of $1.09 a day.265 Labor and Wages. The three considerations that most concern wage earners are the rate of money wages, the cost of living, and the continuity of employment. The money wages of skilled laborers are good, as will be seen by the following table, which represents approximately the rate during the Census year: Scale of Wages in 1900.266 Trades Wages Per Day Blacksmiths........................................$4.00 ---$5 00 Carpenters........................................... 3.00- 4.50 Bricklayers......5........e...................... 5.50- 6.00 Plasterers............................................ 5.00- 6.00 Painters............................7......-..... 2.75- 4 00 Plum bers............................................. 00 5.50 Foreman, Plumbers................................... 6.00- 7.00 Foreman, Carpenters.................................. 500- 7.00 These wages apply only to the independent trades. The average working day is eight or nine hours. On the plantations the working day is usually ten hours, and the money wages are considerably lower. It is difficult to give any general average for skilled plantation laborers, because the wages vary greatly with the race of the workmen. We have already noted the fact 2 4Report of Corn. of Labor, Hawaii, p. 93. 2651bid, pp. 202-231. 266Report of Corn. of Labor, Hawaii, pp. 188-202. OF THE HAWAIIAN ISLANDS. 97 that on 38 plantations the Japanese carpenters received on an average $1.09 a day. On those same plantations there were 43 Chinese carpenters receiving $1.61 a day, 38 Portuguese with an average wage of $1.542, 13 Americans who received $3.67' a day, and various other nationalities with various rates of wages. The other trades show a like variation in the rate of wages, the Chinese, Japanese and Portuguese being at the lower end of the scale and the Americans and men from northern Europe being at the upper end. All employees on the plantation receive house rent and fuel free, and, as a rule, those whose wages are less than $40 per month receive free medical attendance. The great mass of the unskilled laborers on the plantations received about $0.75 or $0.80 a day, and nearly all less than $1.00.267 We have noted that on the plantations laborers receive houses and fuel free, and those who earn less than $40 a month usually receive free medical attendance. This would raise the rate of real wages to some extent, but all three of these items would not amount to much in a country where the climate is healthful and warm the year 'round. Little would have to be expended on clothing, however, which in a cold climate is quite an item of expense. But owing- to the fact that most of the food con. sumed in the islands, including butter, flour, fruit and vegetables, must be imported, it is high. Butter is from $0 50 to $0.60 a pound, milk $0.12 a quart, potatoes from $1.25 to $1.80 a bushel, flour $2.50 to $3.06 a hundred pounds. And, curiously enough, granulated sugar is from six cents to seven cents a pound. This high price is owing to the fact that no sugar is refined on the islands, the supply coming back from the refineries in California. Until within the last few years beef has been quite cheap, but the demand has exceeded the supply of the islands and prices have gone up. In 1890, round steak, for example, retailed at 10 cents a pound, and in 1900 it was 14.9 cents. Nearly all pork used is imported and it is also high, bacon retailing at from 18 to 20 cents a pound.268 As a rule, employment is fairly continuous. It would seem 267Report of Corn. of Labor, Hwaii, pp. 202-231. 268Report of Corn. of Labor, Iawaii, pp. 232-7; Bulletin No. 95, Department of Agriculture, pp. 63-70. ECONOMIC HISTORY that it would be more so were it not for the laborers themselves, many of whom are inclined to be idle part of the time.209 During the Census year 1900, 84.76 per cent of all persons engaged in gainful occupations were in continuous employment, and the majority of the remainder were idle only from one to three months.270 This idleness is partly accounted for by the fact that several strikes occurred during the year. For the two years 1900 and 1901, 24 strikes were reported, involving 8,055 men, and resulting in a loss to the laborers of $21,445 and to the employers of $10,300. The causes of the strikes were various, for discharge of overseer, for a rise in wages, for shorter hours, or to compel the employees to join the local union, being the more common causes or objects. Of the 24 strikes, 7 were successful, 3 were partly so, and 14 failed, those for a reduction of hours all succeeding, for an increase in wages, only a part succeeded, and those for compelling employees to join the local union,all resulted in failure. The trades in Honolulu are so well organized and skilled workmen have been so scarce that they have usually been able to secure their demands without resorting to strikes, and those that have occurred have been of short duration. Only 4 of the 24 strikes occurred in Honolulu, while 17 occurred among Japanese laborers, who have been apt pupils in learning this European method of procedure.27' It will be recalled that the great majority of plantation laborers have been Japanese, imported under contract, or Chinese who were allowed by law to come in as laborers. These contracts were governed by a special set of laws, the most significant provisions being those which empowered the courts to fine and imprison laborers who sought to evade their obligations. On June 14, 1900, when the islands became a part of the United States, this state of things came to an end. The Chinese exclusion laws extended to the new Territory, the Federal statutes also forbade the importation of laborers under contract, and the binding force of those contracts in existence was destroyed. 269Report of Corn. of Labor, Hawaii, p. 18. 270~bid, pp. 89-95, 27 Report of Corn. o Labor, Hawaii, pp. 112-115-254-57. OF THE HAWAIIAN ISLANDS. 99 That is, the laborer could not be fined or imprisoned for refusing to work, but if he should enter into a contract in the future, the ordinary civil law would govern in the case. The first important effect upon the laborers of destroying the old contract laws was to diminish their efficiency and increase the tendency to shift from one plantation to another. In order to induce them to be more steady, some planters advanced the wages of their field hands from $12.50 a month to $15, $18, $20 and even $26 a month.278 But the higher wages the laborers got, the more prone they were to take a day off now and then. This decreased the amount of work a given number of laborers would do in a certain length of time, and the planters began to compete with each other for more laborers, by raising wages still higher. To induce laborers to remain faithful and work more steadily, a bonus system was tried. Some planters gave two dollars a month extra to all who would work twenty-four days during the month. But this plan did not prove very satisfactory, and another has been inaugurated, which promises better results. This plan is that of paying laborers according to the amount of work done, which is determined by the amount of the crop produced. A set of laborers, for example, agree to tend a certain piece of land for a specified price per ton of sugar produced. The laborers receive a part of their wages from time to time and the remainder when the crop is harvested. "This plan," says Commissioner Wright, "has been extended as rapidly as circumstances and the ability to induce laborers to make contracts under it have permitted, and has had the effect of increasing the industry of the workers thus employed and of curbing their inclination to wander from one plantation to another.278 But the other two Federal laws referred to above, the Chinese exclusion law and the law forbidding the importation of contract labor, have had effects not so easily remedied as the effect of the one destroying the ability of planters to fine and imprison laborers for refusing to work. Death, and the disposition of the Mongolian to return home when they have made 272Report of Cor. of Labor, Hawaii, pp. 17-19. 2731bid., p. 18. 100 ECONOMIC HISTORY their little fortunes, have reduced the number of those in the islands at the time of annexation; the Chinese cannot come to take their place and the Japanese do not seem disposed to come of their own accord. From June 14, 1900, to August 31, 1901, 4079 Japanese left the islands and only 589 arrived.274 In order to supply the lack of laborers, Porto Ricans and Negroes from the Southern States have been imported, but the success of the plan is problematical. The result of this scarcity of labor has been to raise wages, especially of unskilled laborers, above the rates given in the census reports, to which we have referred; but how much of a rise there has been it is impossible to say. The effect of the rise in waves and the difficulty of obtaining laborers has been to lower profits and depress the value of plantation stocks.275 This explains the recent movement looking towards the exemption of Hawaii from the Chinese exclusion laws and the law forbidding -lhe importation of laborers under contract. In the report of the Governor of the.' erritory, 1901, it is stated that "It is simply a physical impossibility for the Anglo-Saxon. satisfactorily to perform the severe labor required in the sugar fields,. This being true, Ha"waii is entitled to legislation favorable to its greatest prosperity. The presence of large numbers of Chinese and Japanese has not proved detrimental either to skilled or unskilled American labor."2 7 Trhe statement that the labor required in the cane fields is too severe for an Anglo-Saxon sounds very strange. In the first place, it implies that the men of the Mongolian race have a greater physical endurance than have the Anglo-Saxons, which has never been proved, either by experience or experiment. In the second place, it implies that Chinese and Japanese women are stronger physically than Anglo-Saxon men, for thousands of these women are employed in the fields; and such a claim would need no comment. In the third place, it implies that the work in the sugar fields is particularly severe. But the work of the field hand is chiefly that of dropping the seed in the furrow, covering it with a little dirt, and hoeing, 274Report of the Gov. of Hawaii, p. 63. 276Bulletin No. 95, Dep't Agr., p. 59; Report of Gov. of Hawaii, p. 63. 27'6Peport ofthe Gov. of Hawaii, p. 63. OF THE HAWAIIAN ISLANDS. 101 cultivating, cutting, stripping and loading the cane.277 Many of these operations are similar to those on our western farms and none of them are more severe. Compared with much of the labor of Anglo-Saxons in America and Europe, the work in the sugar fields is light. The real difficulty lies not in the severity of the labor in the sugar fields, but in the fact that good wages would reduce the enormous profits of the capitalists. It might be difficult to secure sufficient labor immediately, but if the climatic conditions are such as the residents of the islands claim they are, there is no reason to doubt that in time a sufficient number of intelligent laborers from Southern Europe or the South would be attracted to the islands, if it were known that good wages and steady employment were to be found there. Why should Hawaii need special legislation any more than any other portion of the country? It is just such special legislation that has created the undesirable conditions that prevail there, and most certainly those conditions should not continue. In addition to the temporary difficulty that would doubtless arise, or that really now exists, in securing a good class of laborers, and the consequent depression in business, the adoption of the policy of replacing the swarms of Mongolians with Americans and Europeans would no doubt permanently squeeze some of the water out of plantation stocks, to the great injury of the present holders. But healthful conditions are to be desired, even though temporary sacrifices must be made and a few individuals injured. Industries. Nearly every business of importance in the Territory is carried on by an organized partnership or a jointstock company. The liability of stockholders in the joint-stock companies is limited to the par value of their stock, whether it is paid up or not. The financial condition of the corporations is good, and no important failure has occurred during the past ten years.278 In 1900 there were 322 domestic corporations, not including benevolent, religious, and educational institutions, and 11 foreign corporations. About half of these corporations 277Bulletin No. 95, Dep't of Agr., p. 59-60; Progress of the Beet-Sugar Industry, pp. 95-96. 278Report of the Gov. of Hawaii, pp. 56-62. 102 ECONOMIC HISTORY are small concerns with capitals ranging from $1500 to $100,000; 75 are medium sized companies, with capitals ranging between $100,000 and $1,000,000; and some 27 or 28 have capitals above $1,000,000. So much of the stock is "watered," however, that it is difficult to tell anything very definite about the amount of capital really invested in these companies.27' The only two branches of industry of any importance are manufacturing and agriculture. Transportation interests are comparatively insignificant, and most of the railroads are owned by the plantations. A little examination of the manufacturing establishments reveals the fact that the more important ones are directly connected with agriculture, as the following table will show: Manufactures and Hand Trades: 1900.280 PN~o. of Value of INDUSTRIES Establish- Capital Products ments Carpentering........................... 17 $ 360,560 $ 492,091 Carriages and Wagons.................. 7 80,993 105,855 Clothing, custom work and repairing.... 86 117,082 286,233 Coffee and spice, roasting and grinding.. 4 86,114 38,401 Coffee cleaning.......................... 6 70,379 94,810 Fertilizers......................... 3 915,304 1,150,625 Foundry and machine-shop products.... 4 607,883 1,107,030 Ice, artificial............................ 4 137,271 56,522 Masonry, brick and stone............ 3 194,903 566,650 Printing and publishing................. 10 110,24 199,516 Rice, cleaning and polishing............ 41 381,625 664,300 Sugar.................................. 44 7,991,642 19,254,773 All other industries...................... 239 504,659 997,230 Total............................ 468 $11,558,609 $25,014,036 This table, instead of revealing "a considerable development of manufacturing and mechanical industries," as it is stated in the Census reports, shows just the opposite.281 Of the total capital invested in these industries, 69 per cent is represented by 44 sugar mills, and the product of these mills is 77 per cent of the total product. Moreover, the coffee, rice, and fertilizer establishments are also nothing but branches of agriculture, and their products, together with that of the sugar mills, amount to 85 per cent of the total product. 279Progress of the Beet-Sugar Industry, p. 123. 280 Census Bulletin No. 121, p. 1-7. 281Bulletin No. I12, p. 3. OF THE HAWAIIAN ISLANDS. 103 ItI will also be seen that neither the capital in these industries nor the value of the products is evenly divided among the various establishments. There are a few large concerns, and the great majority are small. For example, the products of the 51 establishments represented by the sugar mills, foundries, and manufactures of fertilizers, amount to 86 per cent of the total product. Of the 468 establishments, 174 properly belong to the hand trades, and their aggregate products amount to only $1,653,101; 73 are small concerns with a total product of $21,968; and the product of the remaining 221 establishments amounts to over $23,000,000, or nearly 94 per cent of the total product. Agriculture. According to the census reports there were in 1900 2273 "farms," with an aggregate area of 2,609,613 acres, or about 62 per cent of the total area of the islands.282 A "farm" means all the land under one management, and includes everything from a little taro patch to a great stock ranch. Of these 2,609,613 acres, only 294,545 acres are classed as "improved," the remainder consisting of pasture, forest and waste lands. Only about one-half of the "improved" land, or from two to three per cent of the total area of the islands, is acually cultivated. The general conditions are shown in the following table: Number, Acreage, and Value of Farms in 1900, and Crops in 1899.283 NoR.. ACRES IN FARMS VALUE OF FARM CROPS AND PRODUCTS PRINCIPAL N. of PROPERTY SOURCE OF * INCOME Average Total Percent Total Percent Acres Value Taro.......... 441 42.9 18,922 0.7 $562,499 0.8 1,279 $ 177,843 Vegetables.... 101 21. 2 2,139 0.1 117,938 0.2 458 59,863 Fruit........... 116 12.2 1,417 0. 1 182,279 0.2 569 78,776 Live Stock.... 198 7,280.4 1,441,529 55.2 4,529,174 6.1......... 531,339 Dairy produce. 34 17.0 3,979 0.2 131,180 0.2........ 91,876 Tobacco...... 22 1.5 33 (a) 16,415 (a) 23 5,101 Coffee......... 512 137.1 70,218 2.7 1,932,915 2.6 6,451 246,181 Rice.......... 500 33.0 16, 513 0.6 2,588,114 3.5 9,130 1,562,051 MATURED: Sugar......... 170 6,136.0 1,043,117 40.0 63,708,629 86.0 1 GROWI 65,0070 Miscellaneous. 179 65.6 11,746 0.4 315,845 0.4 3,257 524,705 Total.... 2,273 1,148.1 2,609,613 100. 74,084,988 100. 151,854 $22,040,731 (a) Less than one-tenth of 1 per cent. 2820n this topic see Census Bulletin No. i69, pp. 1-16. 28s Census Bulletin No. i69, pp. 8, 10; Summary of Commerce and Finance, July, 1901, pp. 73-74. 104 ECONOMIC HISTORY Before taking up the main points in our table, a few words of explanation will be helpful. The figures in the first six columns refer to farms on which the one crop named constituted 40 per cent of the value of all products of the farm, while the figures in the last two columns refer to the acreage and value of that crop on all farms. For example, our table shows that there were 170 farms devoted chiefly to growing sugar-cane; but there were 14 other farms on which sugar-cane was a minor crop. The Census bulletin from which we have taken the figures for the table implies that only 65,687 acres were planted to cane. But this evidently is an error; for it must be borne in mind that it takes, on an average, two years for a crop to mature, and there are always two crops growing at the same time; and if only 65,687 acres were planted to cane, only about half that area was harvested, and the average yield would be about 7 tons of sugar per acre. It is generally estimated that the average yield is from 4 to 5 tons per acre. Moreover, according to Mr. Walter Maxwell, director and chief chemist of the Hawaiian Sugar Planters' Association, there were in 1897 53,825'2 acres of cane manufactured, and about 125,000 acres planted in cane284 I have therefore considered the 65,687 acres as the area of the crop harvested and have estimated the growing crop at 65,000 acres, making a total of about 130,000 acres as the area planted to cane. Turning now to our table, it is seen that over 95 per cent of the total area of all farms is embraced in afew great stock ranches and sugar plantations, averaging from 6,000 to 7,000 acres. But these general averages do not tell the whole story. There are a few great plantations and ranches much above the average, and a large number of small ones. One plantation contains 45,000 acres, another 18,000, and there are about a dozen others ranging from 10,000 to 15,000 acres.285 There were 138 planters, (who do not manufacture their cane into sugar, but sell it to the other planters or to one of the two independent sugar houses), who sold 172,544 tons of cane in 1899, an average of only 1,250 tons per farm, while the other 46 planters cut 2,066,832 tons, 284Summary of Commerce and Finance, July, 1901, pp. 73-74. 286Progress of the Beet-Sugar Industry, pp. 102-119. OF THE HAWAIIAN ISLANDS. 105 or an average of 44,931 tons per farm.286 The stock ranches show a like disproportion. One cattle ranch contains 400,000 acres, another 180,000 and ten others range from 20,000 to 60,000 acres, the twelve ranches embracing about 65 per cent of the total area contained in stock farms.287 On all large farms devoted to the growing of crops there are great tracts of pasture, forest, or waste lands of comparatively little value. How much of the pasture and forest lands can in the future be cultivated would be difficult to tell. Some plantations utilize their pasture land for raising cattle, and thus supply their hands with meat. The only agricultural industries of any considerable importance are sugar, rice and coffee growing and stock raising. The sugar industry dwarfs all others and furnishes the one great article of export with which the islands largely supply their needs. Rice, coffee and taro are produced slightly in excess of the home consumption. A few bananas, pineapples and other fruits are also exported. As stated above, the islands have produced their own beef until recently, but the increase of the population and the conversion of the best pasture lands into cane-fields have made it necessary to import beef in increasing quantities. All other things consumed in the islands, including flour, most of the fruit and vegetables, part of the beef and nearly all the pork, all clothing, furniture, etc., are imported. Thus there exists a peculiar condition of things. Everything depends upon sugar; and the prosperity of the islands must increase or decrease with that one industry. Should another turn of the political wheel at Washington put sugar on the free list, or should any event happen by which the price of sugar in the United States would be lowered to the price in the world's market, it would be a severe blow to Hawaii. The present output of sugar might possibly be continued, with a fair profit on the real cost of the capital invested; but there would certainly be an enormous shrinkage in the market value of plantation stocks, bringing financial ruin to many persons and producing a severe shock to business in general. 2zs Census Bulletin, No. 169, p. 11. 287Bulletin No. 95, Dep't of Agr., p. 66. 106 ECONOMIC HISTORY About one-third of the land included in farms is owned by the government, and two-thirds by individuals and corporations. That owned by the government is held on long leases; and what shall be done with these lands when the leases expire, is one of the most important questions now confronting Hawaii. From the social point of view, the most desirable condition would be that of smaller farms owned and operated by intelligent men with families. And from the economic standpoint, there seems to be no reason why this condition could not exist. It will be remembered that the majority of the sugar-planters raise but comparatively small crops. Economy of production seems to require the manufacture of the sugar on a large scale,kbut not so with the growing of the cane. Small farms and a central mill would seem to be as advantageous as large plantations with their own mills; for if the majority of the cane growers now sell their cane to some other planter or mill-owner, there is no reason, so far as economy of production is concerned, why the system could not be extended. Unfortunately, some of the public lands lie in such small, irregular tracts, intermingled with private lands, that it would be difficult to sell them to any one except the great land-owner, who holds the land around them288 How much of the public land is in that condition is not stated. There are but few farmers in Hawaii who own the lands they till. The general condition as to ownership and tenure of land will be seen from the following table: Ownership and Tenure of Farms: 1900.289 No FARs NFRS VALUE OF NO. OF ACRES IN FARMS FARM PROPERTY NO. OF NATURE OF TENURE FARMS Aevrage Total Percent Total Percent Owners.................. 684 359.3 245,795 9.4 $ 2,129,029 2.9 Part-owners............. 139 1,275.3 177,263 6.8 1,408.782 1.9 Managers............... 128 16,778.4 2,147,637 82.3 67,840,613 91.5 Cash tenants............ 1,255 29.7 37,296 1.4 2,427,272 3.3 Share tenants............ 67 24.2 1,624 0.1 279,292 0.4 Total.............. 2,273 1,148.1 2,609,613 100.0$74,084,988 100.0 28"Bulletin No. 95, Dep't of Agr., p. 91. 289 Census Bulletin No. i69, p. 6. OF THE HAWAIIAN ISLANDS. 107 More than half the farmers are cash tenants, mostly Chinese and Japanese, who control but 1.4 per cent of the land. Part owners those who own part of the land they operate and lease the remainder, control another meagre portion of the soil, and the 67 share tenants operate a still smaller portion. Only 684 farmers own all the lands they cultivate, and they own only 9.4 per cent of the area in farms and only 2.9 per cent of the value of all farm property. The greater portion of the soil is embraced in 128 great estates, operated by salaried managers. The owners are chiefly whites and Hawaiians, there being 271 whites owning 222,009 acres, and 259 Hawaiians owning 17,009 acres. Future Prospects. We have already touched upon some important questions concerning the future outlook, notably the labor question and the policy that should be pursued in dealing with the public lands. There remain to be considered several other questions of vital interest both to Hawaii and to the people on the mainland. Of these questions, two are of fundamental importance, namely, What limitations are there to the expansion of industry as it now exists on the islands, and What prospects are there for developing new industries or those that are now of little importance? To the further expansion of agriculture in general there are three limits, two of which are absolute, and the other varying with circumstances. It will be remembered that the amount of soil that can be cultivated is limited to a narrow belt around each island. Not far from the coast the soil gets so thin and poor that it cannot be cultivated at all. Secondly, the amount of rainfall fixes an absolute limit to expansion, for the water in the artesian wells and in the reservoirs for gravity irrigation is supplied by rains. In 1898 it was reported by the.Hawaiian Commission that the production of sugar depending upon water from rains or streams had reached its limit, and that further increase must be through pumping.290 The wholesale destruction of the forests by cattle, both wild and tame, and from other causes not known, has recently decreased the amount of rainfall, and severe droughts have occurred where 290Reporl, p. 180. 108 ECONOMIC HISTORY formerly there was sufficient rain.291 The water in the wells is also lowering. At Honolulu it formerly rose forty feet above sea-level, but now it rises only thirty feet. Hence, the danger now seems to be that the present output of sugar and other crops needing considerable moisture may be diminished. The preservation of the forests and the restoration of those already destroyed are therefore vital considerations. The present methods of irrigation are wasteful of the water, the quantity used being generally larger than is necessary,292 and a better adjustment of the water supply might permit of further expansion of the area now under cultivation. The third limitation to further expansion is the cost of production, which depends upon various elements, the most important of which are the cost of irrigation and the rate of wages. Where the water is obtained from artesian wells, the cost of pumping increases as one proceeds from the coast inland. At present the limit is about 600 feet, below which it is not profitable to go, as was noted in a former chapter. If the rate of wages should increase, further expansion would be checked from the lowering of the rate of profits. There is a third item in determining profits, which is of a peculiar nature, namely the tendency of the corporations to expand their capital. Whatever the original cost of the capital may have been, the determining factor in fixing the rate of profits to the present holder is the cost of the stock to him. A fourth item of expense must not be overlooked, and that is the cost of fertilizers. It is well known among agriculturists that any soil soon becomes exhausted by constantly growing one kind of crop, and consequently more fertilizers must be used. It is impossible to predict with any degree of certainty just how much more sugar can be produced in the near future, as will readily be seen from the foregoing discussion. In 1899 it was generally considered that the future maximum production was from 450,000 to 500,000 tons, or about twice the actual amount at that time.293 Dr. Stubbs says in his report to the 291Bulleiin No. 95, Dep't Agr., pp. 70-78. Progress of the Beet-Sugar Industry, p. 100. 292Bulletin No. 95, Dep't Agr., p. 72. Z93Progress of the Beet-Sugar Industry, p. 125. OF THE HAWAIIAN ISLANDS. 109 Department of Agriculture that "Nearly every acre adapted to cane culture on these four islands (the four large islands) is under cultiva'ion, and the probability of a much larger extension of the industry is small."294 Attempts have been made recently to extend the area under cultivation, but some of them failed from lack of fresh water. There is no probability that the rice culture can be extended. Practically all the land suitable for rice is now under cultivation. But the methods of cultivation practiced by the Chinese, who raise nearly all the rice produced on the islands, are crude, and with better methods and better tools the yield _per acre may be increased. The rent paid for rice lands is high, ranging from forty to fifty dollars an acre.295 Just at the present time the future outlook for coffee is uncertain. The blight has been the chief difficulty in the way of the development of coffee culture, but that difficulty has been largely overcome by the introduction of parasites which destroy the insect causing the blight. The quality of the coffee is good, and the climate and soil are fairly well adapted to its growth. But the low prices discourage the further extension of its cultivation. It would be a great gain to Hawaii should it prove profitable in the future, because the coffee lands lie above the sugar belt, and any increase in coffee would be a direct addition to the resources of the islands. It seems probable, also, that coffee culture is adapted to small farms with a central mill for cleaning the berry. But it is to be remembered that the lands suitable to its cultivation are very limited in extent.296 The only fruits grown in any considerable quantities are pineapples and bananas; and these two seem to be about the only ones that could be profitably cultivated to any considerable extent, because other fruits that can be raised in the islands would have to compete with California, or would not bear transportation. But there seems to be a possibility of considerable development of the cultivation of these two fruits for exporta294Bulletin No. 95, p. 58. 295Bulletin No. 95, pp. 94, 96. 296Bulletin No. 95, pp. 54-57, 61-65. 110 ECONOMIC HISTORY tion. A few other fruits, such as oranges, apples and grapes, might be raised for home consumption.297 There would seem to be no reason why vegetables could not be grown in considerable quantities, except that it is more profitable to raise sugar-cane. But whether or not Hawaii develops any other industry besides that of producing sugar, is a problem of the future. It is expected that a government experiment station would do much towards pointing out the way for future progress. For the highest welfare of Hawaii, let it be hoped that present conditions will not long continue, that those fair islands cease to be a mere sugar plantation, tilled by ignorant coolies, and that they become the happy, prosperous land of an enlightened people. 297Bulletin No 95, Dep't Agr., pp. 39-42. APPENDIX TABLE I. IMPORTS AND EXPORTS. (From Summary of Commerce and Finance, July, 1901, p, 273). 0,000 Omitted. YEAR IMPORTS Domestic Foreign Total I I 1843................................ $ 22 $...... $ 6 $ 6 1844......................... 35 10 6 16 1845................................ 58 20 6 26 1846............................... 62. 62 6 68 1847............................... 73 20 5 26 1848............................ 63 26 3 30 1849................................ 77 18 19 38 1850............................... 1,10 53 24 78 1851............................... 1,81 30 38 69 1852............................... 75 25 38 63 1853............................... 1,40 28 19 47 1854................................ 1,59 27 31 58 1855............................... 1,38 27 29 57 1856................................ 1,15 46 20 67 1857............................. 1,13 42 22 64 1858............................. 1,08 52 25 78 1859................................ 1,55 62 30 93 1860................................ 1,22 48 32 80 1861............................... 76 47 18 65 1862................................ 99 58 25 83 1863.......................... 1,17 74 28 1,02 1864............................... 1,71 111 54 1,66 1865............................... 1,94 1,52 28 1,80 1866............................. 1,99 1,50 42 1,93 1867.............................. 1,95 1,32 35 1,67 1868............................. 1,93 1,45 44 1,89 1869............................... 2,04 1,74 62 2,36 1870............................ 1,93 1,51 63 2,14 1871................................ 1,62 1,73 1,15 2,89 1872............................... 1,74 1,40 20 1,60 1873.................... 1,43 1,72 40 2,12 1874............................. 31 1,62 21 1,83 1875......................... 1,68 1,83 25 2,08 1876........................1,81 2,05 18 2,24 1877.............................2,55 2,46 21 2,67 1878........................... 3,04 3,33 21 3,54 1879............................ 3.74 3,66 11 3,78 1880.........3................. 367 4,88 7 4,96 1881............................. 4,54 6,78 6 6,85 1882............................. 4,97 8,16 13 8,29 1883............................ 5,62 8,03 9 8,13 1884............................. 4,63 8,06 78 8,85 1885.............................. 3,83 8,95 20 9,15 1886............................ 4,87 10,34 22 10,56 1887.....,............4,94 9,43 27 9,70 1888.................... 4,54 11,63 7 11,70 1889................................ 5,43 13,81 6 13,87 1890................................ 6,96 13,02 11 13,14 112 APPENDIX. TABLE I.-Continued.!ExPORTS YEAR IMPORTS l.. _YEARS IMPOETS DDomestic Foreign Total 1891................................ 7,43 10,10 15 10,25 1892............................... 4,02 7,95 10 8,06 1893................................ 4,36 10,74 7 10,81 1894............................... 5,10 9,05 1 8 9,14 1895............................. 5,33 8,35 11 8,47 1896................................ 6,06 15,43 7 15,51 1897.............................. 7,68 15,93 8 16,02 1898................................ 10,36 17,10 24 17,34 1899..*......................... 16,06 22,32 30 22,3262 Total..................... $174,04 $258,04 $14,03 1$272,08 NoTE.-Specie not included. TABLE II. Products of Whaling Fleet Trans-shipped from Hawaiian Ports, and Whale Ship Entries. (From Quarterly Reports U. S. Bureau of Statistics, 1885-6, No. 2, p. 414). 0,000 Omitted, Except for Ship Entries. YEAR Whale Oil Sperm Oil Bone Waale-sbip Gallons Gallons Pounds Entries 1847........................................167 1848.............. 254 1849......................................... 274 1850............................. 237 1851................................ 90 10 90 220 1852................................ 1,18 17 315 519 1853............................... 3,78 17 302 535 1854............................... 1,68 15 147 525 1855................................ 1,43 10 87 468 1856............... 1,64 12 107 366 1857................................ 2,01 17 129 387 1858................................ 2,55 22 161 526 1859............................. 1,66 15 114 549 1860................................ 78 4 57 325 1861................................ 79 2 52 190 1862................................ 46 19 73 1863............................... 67 5 33 102 1864............................. 60 3 33 130 1865................................ 57 4 33 180 1866................................ 1,25 1 61 229 1867................................ 82 10 40 243 1868............................ 77 10 59 153 1869..........................69 15.62 102 1869.. 69 15 62 102 1870................................ 44 10 66 118 1871............................... 28 6 2 47 1872............................. 3 5 8 47 1873............................. 57 12 63 1874............................ 40 2 17 43 1875........................... 31 3 10 41 1876................................ 3....... 2 37 1877.................................1...... 1 33 1878...............................7......... 1 27 1879.................................................... 25 1880................................ 14.8 1 16 APPENDIX. 113 TABLE III. DEVELOPMENT OF THE SUGAR INDUSTRY. (From the Hawaiian Annual and Summary of Commerce and Finance, July, 1901.) 0,000 Omitted. EXPORTS OF SUGAR _ _ _ YEA__ _ _ __R _Total YEAR Exports I Pounds Value Per Cent._ _I.. II 1843.............................. $ 6 1,14.............. 1844................................ 16 51........... 1845................................ 26 30.............. 1846................................ 68 30........... 1847............................. 26 59............... 1848............................... 30 50............... 1849................................ 38 65............... 1850............................... 78 75.................. 1851.............................. 69 2.................. 18512................................ 69.................. 1852.............................. 63 69.64.......... 1854........................ 58 5........6...4...... 1855..........4.................. 57 29............... 1856................................ 67 55................. 1855................................ 57 7.................. 1858................................ 67 55.................. 1859................................ 93 18642......... 0 18658................................ 80 1,478......... 1, 0 1861............................... 65 2,38............... 1862............................... 83 3,0.........3 1863............................ 1,02 5,29............ 1864........... o............................................ 1865............................... 1,80 15,31.............. 1866............4............. 1,93 193 7,472................. 1867............1........... 167 17,12.................. 1868................................ 1,89 18,313......... 17,7 1869............................... 2,36 18,30.......... 1870................................ 2,14 18,78................ 1872............................... 1,60 16,99.................. 1873................................289......... 1872.............1..6........... 1,0 14,5699.............. 18753.......................... 2,08 25, C8 $1,21 58 1876.............................. 2,24 26,07 1,27 55 1877............................... 2,67 25,57 1,77 65 1878............................... 3,54 38,41 2,70 76 1879................................ 3,78 49,02 3,10 82 1880................................ 4,96 63,58 4,32 87 1881............................ 6,85 93,78 5,39 79 1882................................ 8,29 114,17 6,32 76 1883................................ 8,13 114,10 7,11 87 1884................................ 8,85 142,65 7,32 82 1885................................ 9,15 71,35 8,35 91 1886................................ 10,56 216,22 9,77 93 1887................................ 9,70 212,76 8,69 90 - - 114 APPENDIX. TABLE III-Continued. EXPORTS OF SUGAR YEAR Total YExports Pounds Value Per Cent 1888............................. 11,70 235,88 10,81 92 1889............................... 13,87 242,16 13,08 96 1890................................ 13,14 259,78 12,15 92 1891................................ 10,25 274,98 9.55 94 1892.................... 8,06 263,63 7,27 90 1893............................. 10,81 330,82 10,20 95 1894............................... 9,14 306,68 8,47 94 1895................................ 8,47 294,78 7,97 94 1896................................ 15,51 443,56 14,93 96 1897......................... 16.02 520,15 15,39 96 1898................................ 17,34 444,96 16,61 96 1899........................ 22,62 545,37 21,89 98 TABLE IV. Value of Domestic Exports from the United States to Hawaii, and Estimated Amount of Duties Remitted on Sugar from Hawaii. (From Summary of Commerce and Finance, July, 1901, pp 251, 253.) Domestic Value of Sugar Estimated YEAR Exports and Molasses Amount of DuImported ties Remitted 1877............................. $1,109,429 $ 2,131,982 $ 986,475 1878..............1................ 1,683,446 2,288,879 989,602 1879.............................. 2,288,178 2,826,129 1,266,555 1880............................... 1,985,506 4,155,322 1,881,563 1881............................... 2,694,583 4,962,058 2,427,778 1882............................... 3,272,172 6,943,340 3,314,939 1883............................... 3 3,683,460 7,377,526 3,554,140 1884............................. 3446,024 7,131,256 2,959,913 1885........................ 2709,573 8,207,198 3,937,947 1886........................... 3,115,899 9,174,612 4,435,092 1887............................... 3,520,593 9,270,063 5,016,381 1888................................ 3,025,898 10,266,465 5,007,201 1889............................... 3,336,040 12,084,666 5,210,050 1890............................. 4,606,900 11,559,142 4,804,477 1891................................ 4,935,911 13,161,274 5,544,151 1892................................ 3,662,018 7,447958............ 1893................................ 2,717,338 8,463,183........... 1894................................ 3,217713 9379,970............ 1895.......................... 3,648,472 7,399,715........... 1896................................ 3,928,187 11,338,698 4,535,393 1897..........4.................... 4,622,581 13,166,613 5,265,752 1898................................ 5,773,672 16,661.152 7,896,838 1899....................... 9,006,671 17,293,265 7,305,632 1900............................. 13,077,506 20,392,409 7.974,910 APPENDIX TABLE V. PUBLIC REVENUE. (From Summary of Commerce and Finance, July, 1901, pp. 273, 276.) 000 Omitted, Except for Tax Per Capita. 115 IMPORTS INTERNAL TAXES YEAR Total Revenue Total Dutiable Revenue Taxes T ax Per Capita I 1843..... 1844.... 1845... 1846..... 1847.... 1848..... 1849..... 1850..... 1851.... 1852..... 1853..... 1854.... 1855.... 1856.... 1857..... 1858..... 1859..... 1860..... 1861..... 1862..... 1863..... 1864..... 1865..... 1866..... 1867.... 1868.... 1869..... 1870..... 1871..... 1872..... 1873..... 1874..... 1875..... 1876..... 1877.... 1878..... 1879..... 1880..... 1881... 1882..... II I...................... ~................... $ 419 538 825 834 1,136 "1, 008" ~ ~2,0.......... 571~........ ~ 5,36............. 1~ (308 8 @@@ e 1,151 ~~ I $ 223 350 581 627 738 633 771 1,101 1,813 759 1,400 1,590 1,383 1,151 1,130 1,089 1,555 1,223 761 998 1,175 1,712 1,946 1,993 1,957 1,935 2,040 1,930 1,625 1,746 1,437 1,310 1,682 1,811 2,554 3,046 3,742 3,673 4,547 4,974 $ 223 350 581 627 738 633 771 1,101 1,813 759 1,400 1,590 1,383 1,151 1,130 1,089 1,555 1,082 650 883 1,076 1,518 1,734 1,840 1,820 1,817 1,791 1,708 1,506 1,594 1,348 1,185 1,505 1,220 1,327 1,313 1,772 1,520 1,746 1,946 $ 8 14 25 36 48 55 83 121 160 113 155 152 158 123 140 116 132 116 98 107 123 159 192 215 220 210 215 223 221 218 198 183 213 199 230 284 359 402 423 505.................................................................................o................,...............................o...*... o...o..... ~..................... o................................................................ oo........o.....,..... 219 245 290 317 367 379 ~ ~* I~ eX Xw ~~~~~~~,r +~~rvrc~~~ ~*~s,~~~~ ~r@r~~~r~ ~~o~~~~~r ~~~~~r~~~ ~~~~~e ~~~ ~~rr~ r~~r~** $162~~~ 219~r~~ 245rr~~ 290~~r 317r~~~ 367~~~~ 379~~~+ $2.84 3.86 4.23 4.58 4.76 5.18 5.29,......., eo oo ooo 3.86 * 4.23aar 4.58 *+ *4.v76 - 4.58~~~ 4.76r~r 5.18~ 5.29~,~ - I APPENDIX TABLE V.-Gontinued. 116 IMPOIRTS INTERNAL TAXES YEAR Total Revenue Total ~Dutiable Revenue Taxes Tax Per Capita 1883........... 5,624 $2,187 $577 $417 $5.16 1884..... $ 3,092 4,637 1,760 551 409 5.07 1885........... 6. 1. 3,830 1,314 302 432 5.09 1886... 3,010 4,877 1,781 580 417 4.67 1887............ 4,943 1,998 595 467 5.41 1&s888...lj 4,812 11 4,540 1,737 546 482 5.71 1889.............. 5,438 1,851 550 537 6.19 1890..... 3,632 6,962 2,551 695 560 6.23 1891.......... 7,439 2,888 732 555 5.85 1892.... 3,916 4,028 1,340 494 529 5.50 1893........... 4,363 1,485 545 539 5.37 1894..... 3,587 5,104 1,705 522 522 5.14 1895..... 2,050 5,339 1,705 547 592 5.62 1896. 2,383 6,063 2,093 656 698 6.32 1897..... 2,659 7,68? 2,373 708 759 6.54 1898..... 2,709 10,368 3,1.37 896 811 6.45 1899..... 3,954 16,069 4,335 1,295 1,068 7.91 1900*........... 10,231 2,073 597 * To June 14th. TABLE VI. POPULATION AT VARIOUS CENSUS PERIODS. (From Summary of Commerce and Finance, July, 1901, p. 86, and Census of 1900). NATIONALITY 1834 1836 1853 1872 1878 1884 1890 1896 1900 Hawaiians..... *130313 108,579 70,036 49,044 44,088 40,014 34,436 31,019 29,787 Part-Hawaiians............. 983 1,487 3,420 4,218 6,186 8,485 7,848 Chinese......................... 364 1,938 5,916 17,937 15,301 19,382 21,741 Americans............ 692 889 1,276 2,066 1,928 2,266 4,290 Hawaiian - born foreigners........... 309 849 947 2,040 7,495 13,733 21,296 British....................... 435 619 883 1,282 1,344 1,538 1,893 Portuguese................ 86 395 436 9,377 8,60(2 8,232 6,512 German.................... 81 224 272 1,600 1,434 912 1,154 French..................... 60 88 81 192 70 75 100 Japanese................................. 116 12,360 22,329 56,234 Norwegians............... 8........ 362 227 216 198 Polynesians.................... 4........... 956 588 409 593 Others................ 80 364 666 416 419 424 2,357 TOTAL... 130,313 108,579 73,138 56,897 57,985 80,578 89,990 109,020 154,001 1 *Different nationalities not reported. BIBLIOGRAPHY. The following include the chief works consulted in the preparation of this essay: I. HISTORIES, TRAVELS, ETC. 1. Alexander, W. D. A Brief History of the Hawaiian People, 1892. 2. Allen, F. H. Commercial Aspect of the Hawaiian Treaty, 1883. 3. Anderson, Rufus. The Hawaiian Islands, 1864. 4. Bates, G. WV. Sandwich Island Notes, by a Haole, 1854. 5. Baxley, H. W. What I saw at the Hawaiian Islands, 1865. 6. Bennett, F. D. Narrative of a Whaling Voyage Around the Globe. (1833-36.) Two vols., 1840. 7. Bingham, Hiram. A Residence of Twenty-one Years in the Sand wich Islands. 3rd Edition, 1849. 8. Bishop, Mrs. Isabella L. Bird. Six Months in the Sandwich Is lands. 4th Edition, 1881. 9. Blackman, W. F. The Making of Iawaii, 1899. 10. Bliss, W. R. Paradise of the Pacific, 1873. 11. Brigham, W. F. Hawaiian Feather Work, 1898.,12. Byron, Captain Lord. Voyage of the Blanche, (1824-5,) 1826. 13. Campbell, Archibald. A Voyage Round the World (1806-12,) 1816. 14. Carpenter, E. J. Hawaiian America, 1899. 15. Chambers, H. C. Constitutional History of Hawaii. Johns Hopkins University Studies, 1896. 16. Cheever, H. T. (1) Island World of the Pacific, 1851. (2) Life in the Sandwich Islands, 1855. 17. Cleveland's Voyages, 2 vols., 1844. 18. Coan, Titus. Life in Hawaii, (1835-81,) 1882. 19. Cook, Captain James. Voyages of Discovery, 2 vols. Ward, Lock, Bowden & Company, London. ^ 20. Corney, Peter. Voyages in the Northern Pacific. Reprinted from London Literary Gazette of 1821, 1846. 21. Dibble, Sheldon. History of the Sandwich Islands, 1843.:2. Ellis, Wm. (1)Journal of a Tour Around Hawaii, 1825. (2) Narrative of a Tour Through Hawaii, 1826. 23. Hawaiian Historical Society Papers, Nos. 1-9. 24. Hill, S. S. Travels in the Sandwich and Society Islands, 1856. 25. Hopkins, Manley. The Sandwich Islands, 1862. 26. Jarves, J. J. (1) History of the Sandwich Islands, 3rd Edition, 1847. (2) Scenes and Scenery in the Sandwich Islands, 1843, 27. Judd, Mrs. Laura F. Honolulu; Sketches of Life, (1828-61,) 1880. 28. Krout, Mary H. Hawaii and a Revolution, 1898. BIBLIOGRAPHY. 11 Mathison, G. F. A Visit to Brazil, Chili, Peru and the Sandwich Islands, (1821-22,) 1825. Meares, Captain John. Voyages, (1788-89.) Musick, John R. Hawaii: Our New Possessions, 1898. National Board of Trade, Committee of. A Report on the Hawaiian Treaty, 1883. Nicholson, H. W. From Sword to Share, 1881. Nordhoff, Chas. Northern California, Oregon and the Sandwich Islands, 1877. Ogle & Aikman. History of the Otaheitean Islands, with an Historical Sketch of the Sandwich Islands, 1800. Owen, Jean A. The Story of Hawaii, 1898. Parke, W. C. Personal Reminiscences, (1850-84,) 1891. Parker, Mrs. E. M. Willis. The Sandwich Islands as they are, not as they should be, 1852. Patterson, Samuel. Narrative of Adventures, 1817. Perkins. Na Motu; or Reef-Rovings in the Pacific, 1854. Portlock, Captain Nathaniel. A Voyage Round the World (1785 -88,) 1789. Reynolds, J. N. Voyage of the Potomac, (1831-34,) 1835. Ruschenberger, W. S. W. Voyage Round the World, (1835-37,) 2 vols., 1838. Simpson, Alexander. Ihe Sandwich Islands, 1843. Simpson, Sir George. Round the World, (1841-42,) 2 vols., 1847. Stevenson & Oleson. Picturesque Hawaii, 1899. Stewart, C. S. A Residence in the Sandwich Islands, 5th Edition, 1839. Townsend, J. K. Narrative of a Journey Across the Rock Mountains and a Visit to the Sandwich Islands, 1839. Vancouver, Captain George. A Voyage of Discovery, 3 vols., 1798. Wheatham, J. W. B. Pearls of the Pacific, 1876. Whitney, C. W. Hawaiian America, 1899. Whitney, H. M. The Tourists' Guide, 1890. Wilkes, Captain Charles. Narrative of the United States Exploring Expedition (1838-42,) 5 vols., 1845. Young, Lucian. The Real Hawaii, 1898. PUBLICATIONS OF THE UNITED STATES GOVERNMENT. Agricultural Resources and Capabilities of Hawaii, Report on, by William C. Stubbs, Ph. D., Bulletin No. 95, Department of Agriculture. Bureau of Statistics, Treasury Department. Quarterly Reports, especially 1884-5, No. 2; 1885-6, No. 2; 1886-7, No. 3; and 1891-2, No. 4. Census Bureau, Bulletins No. 15, 1900; No. 121, 1901; No. 169, 1902; BIBLIOGRAPHY. Commerce and Navigation, Annual Reports on, Bureau of Statistics. Commissioner of Labor, Carroll D. Wright, Report on Hawaii for 1901. Appendix II. Foreign Relations of the United States in Relation with Hawaii, 1894. (A collection of 24 documents.) The Governor of Hawaii, Report for 1901. Hawaiian Commission Report, 1898. Industrial Commission Report, 1900-1901. Inter-State Commerce Commssion, Annual Reports of. Pacific Railway Commission Report, 1887. Progress of the Beet Sugar Industry in the United States in 189), with a Supplementary Report on the Cane-Sugar Industry of the Hawaiian Islands, 1900. Summary of Commerce and Finance. (Special numbers on lHa waii and other Islands. November, 1899, and July, 1901.) Bureau of Statistics, Treasury Department. Tariff Commission Report, 1882. Tariff Hearings, 1886 and 1896. III. PERIODICALS. The Friend, Honolulu, 1852-63. The Hawaiian Annual, Honolulu, 1875-1901. The Hawaiian Spectator, Honolulu, 1838-39. The Islander, Honolulu, 1875. The Missionary Herald, Boston. THE UNIVERSITY OF MICHIGAN GRADUATE LIBRARY DUE SEP,,-i ' SEP,: 11. Lo ~e,,I C-O XLoL cTo — cs $:I~ ":,~) ~ '' j ~-:"i~,.,'\,,,,,iI,"i ~I Jh:;..' la,: ~L1P ' u~ r~~,~ c u I n r '1' '9~. "lir Y1 V\ Si:lir.i;a d Cfii lai rl' '"' DO NOT REMOVE OR MUTILATE CARD