Telegrams Relating to the Financial Obligations of Philippine Emergency & Guerrilla Currency

By Kenneth J. Berger

While looking at the free discarded books from my college's library, I
found a set of books entitled "Foreign Relations of the United States
1946." In this set, Vol. VIII - The Far East (Dept. of State Publication
# 8554; published 1971) on pages 911 & 912 had information on the
redemption of Philippine Guerrilla currency. The text is as follows:

896.24/9-1146: Telegram

The Ambassador in the Philippines (McNutt) to the Secretary of State
Manila, September 11, 1946 [Received September 11 - 8:05 a.m.]

345. For Glasser (a), Treasury, from Lancione.

Part I. Agreement concerning transfer surplus property and liability for
redemption emergency and guerrilla currency will be signed this afternoon
5 p.m. September 11 by representative FLC and President Roxas (b).

Part II. With reference to emergency and guerrilla currency agreement
provides:

"That the United States shall forthwith pay to the Philippines the sum of
25 million dollars on account and in part payment of the financial
obligation and responsibilities of the United States arising from

(1) The issuance in the Philippines of emergency currency, guerrilla
currency, military scrip or other writing intended to circulate as money,
the issuance of which was duly authorized, and

(2) Any unpaid advances, loans, credits and overdrafts by the Philippine
National Bank, the commonwealth of the Philippines or any corporation,
political subdivision or agent thereof, during the war with Japan but not
after the second day of September 1945; and that the Philippines, as
partial consideration for the property transferred hereunder and not
identified in Article 5a, hereof as granted under the Philippine
Rehabilitation Act of 1946, hereby releases and acquits the US of the
unpaid balance of the financial obligations and responsibilities
aforesaid and shall forever indemnify and hold the US harmless from all
claims and demands of every nature arising therefrom by any person or
persons whomsoever."

Remaining provisions cited ourtel 234 (c) unchanged.
Complete text follows airmail (D).

Part III. I did not participate in any of the discussions or negotiations
concerning above agreement.
This is A No. 235.

McNutt

(a) Harold Glasser, Assistant Director, Division of Monetary Research,
Treasury Department.
(b) William E. Vogelback signed for the United States on September 11.
(c) Telegram 312. September 6, p. 905.

The Ambassador in the Philippines (McNutt) to the Secretary of State
Manila, September 3, 1946 - 4 p.m. [Received September 3 - 6:12 a.m.]

It stated:

" . . . 1. Estimate present fair value surplus property in Philippines
approximately 147,000,000. . . .
4. Remaining 37,000,000 to be transferred to Philippine Government
together with $25,000,000 cash against its agreement to (a) assume
liability for emergency currency advanced by local government entities to
US forces before Corregidor surrender. (b) Assume liability for all
outstanding guerilla currency. . . . 5. Estimated outstanding
emergency currency $5,000,000 guerilla currency issued total about
60,000,000. . . ."

(d) Despatch 163. September 16, not printed.

Comments & Observations:

The above telegram states that the United States paid the Philippines 25
million dollars in part payment of the financial obligation arising from
the issuance of emergency currency and guerrilla currency. Yet Julian
Jumalon, the designer of numerous emergency currency issues, was denied
payment for his services because they were considered pre-war
obligations. This is interesting since he designed them for the Cebu
Emergency Currency Committee between 29 December 1941 and late January
1942. He was then transferred to the Cebu Provincial Capital to design
another series of emergency notes for the Cebu Emergency Currency Board.
All of were delivered prior to 10 April 1942, the date of the Japanese
occupation of Cebu. So, his designs were not pre-war but rather during
the war and were done while Cebu was not yet occupied by the Japanese.
So, even though these emergency currency notes were redeemed after the
war (see Shafer 1974), Julian Jumalon was not paid for his design work.
It seems to me that he should have been.

It's amazing what you can find in the trash.