Elpidio Quirino, 1948-1953

Elpidio Quirino served as vice president under Manuel Roxas. When Roxas died in 1948, Quirino
became president.
Contributions and Achievements:
● Hukbalahap guerrilla movement active during his presidency
● created Social Security Commission
● created Integrity Board to monitor graft and corruption
● Quezon City became capital of the Philippines in 1948

President Quirino established the Action Committee on Social Amelioration through Administrative
Order No. 68, in order to efficiently promote the welfare of citizens in the rural districts. He established
the Social Security Study Commission by virtue of Executive Order No. 150, to investigate socio-
economic problems of the working class and formulate legislation developing social welfare. The Labor
Management Advisory Board, established by Executive Order No. 158, formulated labor policies and
conducted studies on the ways and means of preventing, minimizing, and reconciling labor disputes. The
Agricultural Credit and Cooperative Financing Administration, established by Republic Act. No. 821,
assisted farmers in securing credit as well as developing cooperative associations to efficiently market
their agricultural commodities.

The Quirino administration reached out to the leaders and members of Hukbo ng Bayan Laban sa Hapon
(HUKBALAHAP) and the Pambansang Kaisahan ng mga Magbubukid (PKM) to negotiate peace and
put an end to the insurgency. In 1948, through Proclamation No. 76, the government granted amnesty to
the insurgents that surrendered arms. The negotiation failed to persuade HUKBALAHAP leader Luis
Taruc and other rebel leaders, as they conceded to register but never disarm. From 1950 to 1953,
Secretary of National Defense Ramon Magsaysay and President Quirino exerted efforts in reforming the
nation’s Armed Forces and promoting welfare of citizens in the rural areas through the Economic
Development Corps (EDCOR) and Land Settlement and Development Corporation (LASEDECO). This
resulted to a considerable improvement to the country’s insurgency problem. There were over 25,000
armed communists in early 1950—two thirds of which had either been captured, killed, or had voluntarily
surrendered; an estimated 60,000 firearms were surrendered or captured.

Source: Third Republic: Govph https://www.officialgazette.gov.ph/featured/third-republic/

The nation during Elpidio Quirino’s presidency, 1948 to

1953
When the Republic was inaugurated in 1946 with Quirino as vice-president, the Philippine economy had
been devastated. Gross output was 30 per cent of the 1940 GDP. Agriculture and industry were either in a
state of injury or devastation. When he took over as president in 1948, the economy was on course for a
rapid recovery, helped along by continuing large US (military) expenditure at the end of the war and by
US rehabilitation assistance in the form of war damage payments.
America’s version of Marshall plan (not so-called because of very special political and economic
relations) was the Philippine Rehabilitation Act of 1947. This US law enabled the appropriation of $520
million for the rehabilitation of the economy – to finance the restoration of destroyed public infrastructure
facilities and to award war damage payments for the rehabilitation of properties and businesses destroyed.

(For those who think today this amount of dollar aid was small, consider this. The purchasing power of
the dollar of 1940 that was used to evaluate the war damage is worth at least 15 times that of the US
dollar of 2015.)

War damage payments helped to speed up the rehabilitation of the economy. These payments contributed
immensely to economic rebuilding and to new development. Being quickly disbursed payments within a
period of three years until 1950, they provided direct income flows to the recipients.

Economic imbalances. The beginnings of macroeconomic imbalances happened during Quirino’s time.
Tax revenues and other government receipts were not enough to cover the large expenditure on
rehabilitation and development. Foreign grants (mostly US payments) helped to fill the gap.

Despite the abundance of American economic expenditures and aid, the demand for foreign goods far
outstripped the country’s inflows of dollar resources. The magnitude of the reconstruction plus the
insatiable want to restore peace time levels of consumption produced this imbalance.

The exchange rate, pegged at the old pre-war and pre-independence value of two to one, also encouraged
excessive spending. At about this time, in 1949, the newly created Central Bank opened its doors and the
governor (the former secretary of Finance), Miguel Cuaderno, recommended the imposition of import
controls.

Later, as conditions tended to worsen, import controls were assisted by more stringent exchange controls.
The uses for the allocation of dollars had to be prioritized.

Investments and export recovery. Investments and recovery were helped however by the heavy inflows
of assistance from the US.

Infrastructure reconstruction was rapid. Public edifices destroyed by the war were rebuilt with public war
damage money. Major roads and bridges, ports and school-buildings were restored. Public utilities were
restored.

Private housing and business investments were stimulated by the war damage payments. Damaged
businesses – in agriculture, industry, manufacturing and commerce – were assisted in part by the quickly
disbursed war damage payments.

New domestic infrastructure projects also came into being. Hydroelectric power began to be harnessed.
The Ambuklao Dam in Luzon and the Maria Cristina Falls were harnessed to produce electricity.

The country’s major export industries began to recover. The processing of coconut products expanded
and many of the sugar mills began to be restored and exports of these products began to recover. Some
mining and timber firms resumed production.

During Quirino’s presidency, the country continued to receive support from US development aid and
enjoyed the early years of the special relations covering trade adjustment, war damage payments, and an
effort to promote domestic industrialization.
The import and exchange controls encouraged businessmen to produce products that replaced imports.
The beginnings of industrial import substitution were promoted by the law promoting “new and necessary
industries.”

The government also started to undertake mass housing for low and middle income earners. This program
was under the People’s Housing Homesite Corp., a forerunner of the National Housing Authority. Thus
begun housing projects designed to be amortized by citizens -- Projects 1, 2, 3 and 4 in the Metro Manila
area.

The housing displacements during the war and continuous migration to cities haunt us even today. A
future in self-financed mass housing was begun during Quirino’s time.

Optimistic future. Although new problems were emerging for the country, there was a lot of optimism in
1953. The economic rehabilitation was carried well forward. New horizons for development were
opening up.

In fact, in 1953 the Philippines was well-positioned to become successful in economic development. The
country then was the envy of many countries facing postwar reconstruction and development.

Source: The Nation During Elpidio Quirino's Presidency, 1948 To 1953

https://www.philstar.com/business/2015/11/10/1520510/nation-during-elpidio-quirinos-presidency-
1948-1953

President Quirino created a committee to look into the actual conditions obtaining in the Surplus
Commission. The committee was composed of Justice Antonio Horilleno, former member of the Supreme
Court, chairman, and Deputy Collector of Internal Revenue Alfredo Jacinto and Deputy Auditor General
Pio Joven, members. Even while Quirino was waiting for the final written report of the surplus
investigation committee, another controversy arose. Senator Fernando Lopez demanded investigation of
Immigration Commissioner Engracio Fabre. Commission Fabre had met Senator Lopez at the
Malacañang palace and informed him that he had already released his immigration quota allocation. The
Senator considered this as an insult. The press had sensationalized reports that senators and congressmen
guaranteeing safe conduct of prospective Chinese immigrants had been receiving fees for the favor. The
law only allowed 500 Chinese (who satisfied all legal requirements) to enter the country each year. The
task of screening these immigrants was assigned to the immigration office which had allowed members
congress to make a guarantee for each entry. Congressman Ramon Magsaysay of Zambales revealed that
certain members of Congress were indeed dragged into the immigration office: “About the middle of
1947, I was approached by an individual who mentioned to me ‘immigration quotas’ for congressmen.
The individual informed me that several aliens had been allocated to me and that 18,000 pesos would be
mine if I would just affix my signature to a letter which he prepared for me addressed to Commissioner
Fabre.” Another scandal which rocked the Quirino administration involved the distribution of
streptomycin, then a newly discovered wonder drug for tubercular patients. The government was reported
to have sold this drug at a high price. Private dealers could not import the medicine in quantities because
the government had appropriated the entire allocation for the entire country. Certain government officials
were reported to have made exorbitant profits through the control of the sale and distribution of the drug.
Quirino ordered the Secretary of Public Health, Dr. Antonio Villarama to explain the charges against the
government. Villarama said that the government was only charging one centavo more per vial above cost,
and that the net proceeds which amounted to 400,000 pesos had been intended for the construction of a
hospital. In addition, he insisted that the government had a duty to break the black market on the drug that
had arisen. He reported that while the government sold the drug at 11.24 pesos per vial, or one centavo
over landed cost, private dealers were selling it at prices ranging from 25 pesos to 35 pesos per vial. Since
the government could purchase that drug at a lower price, Quirino ordered that drug to be sold at 6 pesos
per vial and announced that all private firms could order the drug direct from the United States at no more
than 200 pesos per order in accordance with existing regulations. This development threatened to involve
the diplomatic status of the Philippine Embassy in Washington through which agreements with the
American manufacturers on behalf of the local buyers had been made. In another incident, President
Quirino was obliged to request Maximo M. Kalaw, manager of NACOCO (National Coconut
Corporation) to submit a report on its operations. Kalaw’s request for a loan of 5,000,000 pesos from the
Philippine National Bank to carry on the trading activities of the company and to prop up its credit
facilities had been denied. Kalaw’s report showed a loss of over 3,000,000 pesos in its operation for
which he blamed the bank. The bank, he charged, had failed to extend the much needed credit for its
copra trading activities. He also blamed the competition offered by two US government entities, one
purchasing copra for SCAP and the other for the Marshall plan in Europe. These two agencies, Kalaw
claimed, made bids for copra with dollars in the United States while they bought the copra with pesos in
the Philippines. Their dollar operations enabled them to trade liberally in the Philippines thus placing
NACOCO in a losing position. A civil suit to recover damages from Kalaw, together with Juan Bocar,
Casimiro Garcia and Mrs. Leonor Moll, members of NACOCO board, was filed in court. Kalaw was
suspended and the board members replaced. Two hundred employees of the NACOCO were laid off as a
result. Another press scandal was provoked by the accusation that the benefits to veterans and their heirs
were not reaching the legitimate claimants because some army officers, their wives and the local
postmasters intervened. It was reported that the amount of 94,000,000 transferred by the US army to the
Philippines to pay the claims of the veterans and their heirs never reached the lawful beneficiaries. On 19
May, representatives of the National Federation of Tenants Associations of the Philippines, headed by
Jeremias Jimenez, and of the League of Tenants Associations, headed by Francisco S. Navarro, called on
Quirino in Malacañang to demand the resignation of Roman Ozaeta, Secretary of Justice and Faustino
Aguilar, manager of the Rural Progress Association. These associations claimed that both officials failed
to show interest in the tenants’ welfare. They reminded Quirino that President Roxas had promised to
expropriate certain estates for distribution among the tenants and that the two officials had done nothing
to fulfill the pledge.

Source: Lopez, S. P. (1990). Elpidio Quirino: The Judgement of History.